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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
      Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2005,oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)   OF
    THE SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          
    to   Commission file number:
    000-31745
      THIRD WAVE TECHNOLOGIES,
    INC.
 (Exact name of Registrant as
    specified in its charter)
  Delaware

39-1791034(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)502 S. Rosa Road,
    Madison, WI(Address of principal
    executive offices)

53719(Zip Code)   (888) 898-2357
 (Registrants telephone
    number, including area code)
  Securities registered pursuant
    to Section 12(b) of the Exchange Act:
 None
  Securities registered pursuant
    to Section 12(g) of the Exchange Act:
  Common stock, $.001 par value
    per share
 preferred stock purchase
    rights
 (Title of Class)
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K.  Yes o þ
  Rule 12b-2
  Large
    accelerated filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o  Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K: Form 10-K




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##### 



THIRD
    WAVE TECHNOLOGIES
  FORM 10-K
 FOR THE
    Year Ended December 31, 2005
   TABLE OF CONTENTS
  PagePART IItem 1.

Business


3Item 1A.

Risk Factors


12Item 1B.

Unresolved Staff
    Comments


22Item 2.

Properties


23Item 3.

Legal
    Proceedings


23Item 4.

Submission of
    Matters to a Vote of Security Holders


24PART IIItem 5.

Market for
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities


24Item 6.

Selected Financial
    Data


25Item 7.

Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


26Item 7A.

Quantitative and
    Qualitative Disclosures about Market Risk


32Item 8.

Financial
    Statements and Supplementary Data


33Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


54Item 9A.

Controls and
    Procedures


54Item 9B.

Other
    Information


56PART IIIItem 10.

Directors and
    Executive Officers of the Registrant


56Item 11.

Executive
    Compensation


56Item 12.

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


56Item 13.

Certain
    Relationships and Related Transactions


56Item 14.

Principal
    Accountant Fees and Services


56PART IVItem 15.

Exhibits, Financial
    Statements and Schedules


56Signatures


57Amended and Restated BylawsSeverance AgreementAmended LTIP 2Severance AgreementLTIP 3List of SubsidiariesConsent of Independent Registered Public Accounting FirmConsent of Independent Registered Public Accounting FirmCEO's Certification Pursuant to Section 302CFO's Certification Pursuant to Section 302CEO's Certification Pursuant to 18 U.S.C. Section 1350CFO's Certification Pursuant to 18 U.S.C. Section 1350   2




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FORWARD-LOOKING
    STATEMENTS
  Form 10-K Form 10-K, Form 10-K
    Form 10-K,
  Form 10-K,
  ® ® ® ® ® tm tm tm .
 PART I  ITEM 1.
    BUSINESS  OVERVIEW
  ®
    THIRD
    WAVE MISSION AND CORPORATE STRATEGY
  ®
 3




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
    Grow our U.S. clinical molecular diagnostic revenue through
    our expanding product menu by using our strong
    U.S. distribution and thought-leader networks.
    Continue to expand our pipeline of molecular diagnostic products
    and enhance our product capabilities.
    Partner when appropriate to optimize our opportunities in
    molecular diagnostics and in markets where the Invader chemistry
    can create unique competitive advantages.  TECHNOLOGY
  Invader
    Chemistry
      ®
    INDUSTRY
    BACKGROUND
       4




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LIMITATIONS
    OF CONVENTIONAL METHODS VERSUS THE THIRD WAVE SOLUTION
    Name

Platform

StatusPCR

Target Amplification

Most commonly used technologyTMA/NASBA

Target Amplification

Market leader for blood screeningHybrid Capture

Signal Amplification

Currently used primarily for HPV
    testingLigation

Signal Amplification

Primarily used in cystic fibrosis
    testingINVADER®

Signal Amplification

Adoption across multiple
    applicationsInvader
    Plustm

Target/Signal Amplification

New capability for numerous
    applications       
    Increased Accuracy  In the study submitted to
    the FDA as part of the Companys application for clearance
    of its Invader UGT1A1 Molecular Assay, it was 100% accurate
    compared to DNA sequencing, the standard for genotype
    determination.
    Ease of Use  Invader products are extremely easy
    to use for technicians of any skill level. Assay setup requires
    a simple addition of the reagents to the prepared sample and can
    be completed with minimal hands-on time. During the incubation
    at a single temperature, technicians are free to perform
    additional duties.
    Flexibility/Scalability  The Invader chemistry
    is highly scalable, allowing any Clinical Laboratory Improvement
    Amendments (CLIA)-high complexity lab, regardless of size, to
    take advantage of its benefits.
    Throughput  The Invader chemistry offers
    customers a higher throughput potential than other methods,
    providing cost and time-saving benefits.  PRODUCTS
    AND PRODUCT CANDIDATES
  ®
  Molecular Diagnostics
  PRODUCTS
    ON THE MARKET  UNITED STATES
  InVitro
    Diagnostic (IVD) Devices
  
    Invader UGT1A1 Molecular Assay  Analyte
    Specific Reagents (ASRs)
  
    Hepatitis C virus (HCV) 5




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
    Cystic Fibrosis Transmembrane Conductance Regulator gene (CFTR)
    Human Papilloma virus (HPV)
    Connexin 26
    Factor V (Leiden)
    Factor II (prothrombin)
    Methylenetetrahydrofolate reductase (MTHFR gene)
    Apolipoprotein E (ApoE gene)  PRODUCTS
    ON THE MARKET  EUROPEAN ECONOMIC AREA
    (EEA)
  InVitro
    Diagnostic Devices  CE Mark
  
    Factor V Leiden (G1691A)
    Factor II (FII G20210A)
    Methylenetetrahydrofolate reductase (MTHFR) (C677T)
    Methylenetetrahydrofolate reductase (MTHFR) (A1298C)
    Apolipoprotein E (ApoE) (C112R)
    Apolipoprotein E (ApoE) (R158C)
    Plasminogen Activator Inhibitor-1 (PAI-1) (4G/5G)
    Platelet Glycoprotein IIIa (PL A1/A2) (Leu 33 Pro, T1565C)
    Connexin 26 (Gap Junction Beta 2 gene; 35delG)
    Connexin 26 (Gap Junction Beta 2 gene 167delT)  PRODUCTS
    IN DEVELOPMENT OR BEING ASSESSED FOR TECHNICAL FEASIBILITY AND
    COMMERCIAL VIABILITY
  
    HCV viral load
    Additional HPV offerings
    Additional CFTR offerings
    Coumarin (drug metabolism markers)
    Chlamydia
    Gonorrhea
    Hepatitis B virus
    Various additional CYP450 products (identification of genes
    associated with drug response)    MANUFACTURING
   6




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MARKETING
    AND SALES
          and/or
    Form 10-K.
    COLLABORATIVE
    RELATIONSHIPS
   7




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BML
    MONOGRAM
    BIOSCIENCES (formerly ACLARA BIOSCIENCES, INC.)
  ® ® tm
    UNIVERSITY
    OF TOKYO/RIKEN
      INTELLECTUAL
    PROPERTY
  and/or and/or
 8




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COMPETITION
  and/or
   9




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®
  ®
      GOVERNMENT
    REGULATION
         10




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®
             11




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RESEARCH
    AND DEVELOPMENT
    EMPLOYEES
    AVAILABLE
    INFORMATION
  Form 10-K, Form 10-Q, Form 8-K,
  ITEM 1A.
    RISK
    FACTORS  RISKS
    RELATED TO OUR BUSINESS
  WE HAD
    AN ACCUMULATED DEFICIT OF $158.1 MILLION AT DECEMBER 31,
    2005, AND EXPECT TO CONTINUE TO INCUR SUBSTANTIAL OPERATING
    LOSSES FOR THE FORESEEABLE FUTURE.
    FLUCTUATIONS
    IN OUR QUARTERLY REVENUES AND OPERATING RESULTS MAY NEGATIVELY
    IMPACT OUR STOCK PRICE.
    
    the volume and timing of orders for our products;
    changes in the mix of our products offered;
    the timing of payments we receive under collaborative
    agreements, as well as our ability to recognize these payments
    as revenues;
    the number, timing and significance of new products and
    technologies introduced by our competitors; 12




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
    third-party intellectual property, which may require significant
    investments in licensing or royalties, or which may materially
    impede our ability to sell products;
    our ability to develop, obtain regulatory clearance, market and
    introduce new and enhanced products on a timely basis;
    changes in the cost, quality and availability of equipment,
    reagents and components required to manufacture or use our
    products;
    availability of commercial and government funding to researchers
    who use our products and services, including our single-largest
    research customer in Japan; and
    availability of third-party reimbursement to users of our
    clinical products.  quarter-to-quarter
  OUR
    TECHNOLOGIES AND COMMERCIAL PRODUCTS MAY NOT BE COMMERCIALLY
    VIABLE OR SUCCESSFUL, WHICH COULD ADVERSELY AFFECT OUR
    BUSINESS.
    WE
    HAVE LIMITED MANUFACTURING EXPERIENCE AND MAY NEED TO MODIFY,
    EXPAND OR ESTABLISH NEW MANUFACTURING FACILITIES AS WE
    COMMERCIALIZE OUR PRODUCTS.
   13




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OUR
    LIMITED SALES AND MARKETING EXPERIENCE AND CAPACITY MAY
    ADVERSELY AFFECT OUR ABILITY TO GROW AND TO COMPETE SUCCESSFULLY
    IN COMMERCIALIZING OUR POTENTIAL PRODUCTS.
        THE
    EARLY TERMINATION OF ANY OF OUR STRATEGIC COLLABORATION OR
    CUSTOMER SUPPLY AGREEMENTS COULD SERIOUSLY HARM OUR BUSINESS AND
    FINANCIAL CONDITION.
   14




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WE MAY
    REQUIRE ADDITIONAL FINANCING FOR OUR FUTURE OPERATING PLANS.
    FINANCING MAY NOT BE AVAILABLE ON ACCEPTABLE TERMS, IF AT
    ALL.
    
    our progress with our research and development programs;
    the needs we may have to pursue FDA clearances or approvals of
    our products;
    our level of success in selling our products and technologies;
    our ability to establish and maintain successful collaborations;
    the costs we incur in securing intellectual property rights,
    whether through patents, licenses or otherwise;
    the costs we incur in enforcing and defending our patent claims
    and other intellectual property rights;
    the timing of purchases of additional capital;
    the need to respond to competitive pressures; and
    the possible acquisition of complementary products, businesses
    or technologies.    FAILURE
    TO MAINTAIN EFFECTIVE INTERNAL CONTROLS IN ACCORDANCE WITH
    SECTION 404 OF THE SARBANES-OXLEY ACT COULD HAVE A MATERIAL
    ADVERSE EFFECT ON OUR BUSINESS AND STOCK PRICE.
    COMMERCIALIZATION
    OF OUR TECHNOLOGIES MAY DEPEND ON STRATEGIC PARTNERSHIPS AND
    COLLABORATIONS WITH OTHER COMPANIES, AND IF OUR CURRENT OR
    FUTURE PARTNERSHIPS AND COLLABORATIONS ARE NOT SUCCESSFUL, WE
    MAY EXPERIENCE DIFFICULTY COMMERCIALIZING OUR TECHNOLOGIES AND
    PRODUCTS.
   15




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WE ARE
    IN A HIGHLY COMPETITIVE INDUSTRY AND MARKETPLACE. COMPETITIVE
    DEVELOPMENTS, INCLUDING NEW TECHNOLOGIES THAT RENDER OURS LESS
    COMPETITIVE OR OBSOLETE, COULD SERIOUSLY HARM OUR
    BUSINESS.
  and/or
  
    diagnostic, biotechnology, pharmaceutical, healthcare, chemical
    and other companies;
    academic and scientific institutions;
    governmental agencies;
    public and private research organizations; and
    clinical labs.      WE MAY
    BE UNABLE TO PROTECT OUR PROPRIETARY METHODS AND TECHNOLOGIES
    AND MAY BE SUBJECT TO CLAIMS OF INFRINGEMENT OF THE INTELLECTUAL
    PROPERTY RIGHTS OF OTHERS.
   16




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OTHER
    RIGHTS AND MEASURES THAT WE RELY UPON TO PROTECT OUR
    INTELLECTUAL PROPERTY MAY NOT BE ADEQUATE TO PROTECT OUR
    PRODUCTS AND COULD REDUCE OUR ABILITY TO COMPETE IN THE
    MARKET.
   17




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and/or
  
    the agreements may be breached;
    we may have inadequate remedies for any breach;
    the employees, collaborators, consultants and other third
    parties may apply for patents on improvements to our
    technologies without assigning ownership rights to us;
    proprietary information could be disclosed to our
    competitors; or
    others may independently develop substantially equivalent
    proprietary information and techniques or otherwise gain access
    to our trade secrets or disclose such technologies.    IF WE
    FAIL TO RETAIN OUR KEY PERSONNEL AND HIRE, TRAIN AND RETAIN
    QUALIFIED EMPLOYEES, WE MAY NOT BE ABLE TO COMPETE EFFECTIVELY,
    WHICH COULD RESULT IN REDUCED REVENUES.
        WE
    PLAN TO CONTINUE TO INTRODUCE PRODUCTS FOR THE CLINICAL MARKET,
    AND WE MAY NEED TO OBTAIN FDA CLEARANCES AND APPROVALS AND
    COMPLY WITH FDA
    QUALITY SYSTEM REGULATIONS AND OTHER REGULATIONS RELATING TO THE
    MANUFACTURING, MARKETING AND SALE OF CLINICAL
    PRODUCTS.
     18




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®
    
    administrative or judicially imposed sanctions;
    injunctions, civil penalties, recall or seizure of our products;
    total or partial suspension of production;
    failure of the government to grant premarket clearance or
    premarket approval for our products;
    withdrawal of marketing clearances or approvals; and
    criminal prosecution.    OUR
    INTERNATIONAL SALES ARE SUBJECT TO CURRENCY, MARKET AND
    REGULATORY RISKS THAT ARE BEYOND OUR CONTROL.
   19




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OUR
    FAILURE TO COMPLY WITH ANY APPLICABLE ENVIRONMENTAL, HEALTH,
    SAFETY AND RELATED GOVERNMENT REGULATIONS MAY AFFECT OUR ABILITY
    TO DEVELOP, PRODUCE OR MARKET OUR POTENTIAL PRODUCTS AND MAY
    ADVERSELY AFFECT OUR RESULTS OF OPERATIONS.
    WE MAY
    BE HELD LIABLE FOR ANY INACCURACIES ASSOCIATED WITH NUCLEIC ACID
    TESTS PERFORMED USING OUR PRODUCTS, WHICH MAY REQUIRE US TO
    DEFEND OURSELVES IN COSTLY LITIGATION.
    IF OUR
    VENDORS FAIL TO SUPPLY US WITH COMPONENTS FOR WHICH AVAILABILITY
    IS LIMITED, WE MAY EXPERIENCE DELAYS IN OUR PRODUCT DEVELOPMENT
    AND COMMERCIALIZATION.
    RELIANCE
    ON COMPUTER HARDWARE, SOFTWARE AND APPLICATIONS FOR
    OPERATIONS
   20




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FUTURE
    ISSUANCE OF OUR PREFERRED STOCK MAY DILUTE THE RIGHTS OF OUR
    COMMON STOCKHOLDERS.
    WE
    HAVE VARIOUS MECHANISMS IN PLACE THAT A STOCKHOLDER MAY NOT
    CONSIDER FAVORABLE AND WHICH MAY DISCOURAGE UNSOLICITED TAKEOVER
    ATTEMPTS.
    
    authorizing our Board of Directors to issue preferred stock and
    to determine the price, privileges and other terms of these
    shares without any further approval of our stockholders, which
    could increase the number of outstanding shares or thwart an
    unsolicited takeover attempt;
    establishing a classified Board of Directors with staggered,
    three-year terms, which may lengthen the time required to gain
    control of our Board of Directors;
    prohibiting cumulative voting in the election of directors,
    which would allow a majority of stockholders to control the
    election of all directors;
    requiring super-majority voting to effect certain amendments to
    our certificate of incorporation and bylaws;
    limiting who may call special meetings of stockholders;
    prohibiting stockholder action by written consent, which
    requires all actions to be taken at a meeting of stockholders;
    establishing advance notice requirements for nominations of
    candidates for election to the Board of Directors or for
    proposing matters that can be acted upon by stockholders at
    stockholder meetings; and
    payments due to executive officers and other employees under
    executive compensation plans, long-term incentive plans and
    employment and similar agreements that could be triggered
    certain change of control events.    OUR
    DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS WILL
    HAVE SUBSTANTIAL CONTROL OVER OUR AFFAIRS.
   21




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RISKS
    RELATED TO THE BIOTECHNOLOGY INDUSTRY
  PUBLIC
    OPINION REGARDING ETHICAL ISSUES SURROUNDING THE USE OF GENETIC
    INFORMATION MAY ADVERSELY AFFECT DEMAND FOR OUR
    PRODUCTS.
    GOVERNMENT
    REGULATION OF GENETIC RESEARCH OR TESTING MAY ADVERSELY
    AFFECT THE DEMAND FOR OUR PRODUCTS AND IMPAIR OUR BUSINESS AND
    OPERATIONS.
    HEALTH
    CARE COST CONTAINMENT INITIATIVES COULD LIMIT THE ADOPTION OF
    GENETIC TESTING AS A CLINICAL TOOL, WHICH WOULD HARM OUR
    REVENUES AND PROSPECTS.
    REIMBURSEMENT
    FOR USE OF OUR PRODUCTS
    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS.   22




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ITEM 2.
    PROPERTIES    Approx.SquareType of Facility

Footage


Lease ExpirationHeadquarters, research and
    development, manufacturing, selling, marketing, and
    administration


95,000


September 2011, with an
    option
    to extend for three
    5-year
    periods.     ITEM 3.
    LEGAL
    PROCEEDINGS           23




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ITEM 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS   PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES    Fiscal Year Ended
    December 31, 2005

High


LowFirst Quarter

$
8.45


$
4.56Second Quarter

$
5.66


$
3.66Third Quarter

$
5.78


$
3.96Fourth Quarter

$
5.17


$
2.63   Fiscal Year Ended
    December 31, 2004

High


LowFirst Quarter

$
4.82


$
3.37Second Quarter

$
5.40


$
4.21Third Quarter

$
6.88


$
3.19Fourth Quarter

$
8.94


$
6.88       Use of
    Proceeds.
  Form S-1, No. 333-42694),
     24




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ITEM 6.
    SELECTED
    FINANCIAL DATA  Form 10-K.
  For Year Ended December
    31,2005


2004


2003


2002


2001(In thousands, except for per
    share amounts)STATEMENT OF OPERATIONS DATA:Revenues

$
23,906


$
46,493


$
36,320


$
32,355


$
34,092Operating expenses:Cost of goods sold


7,104



12,492



12,840



21,320



32,746Research and development


8,389



11,637



12,035



13,934



16,179Selling and marketing


12,772



10,803



8,859



9,578



9,200General and administrative


11,788



12,913



9,642



11,666



14,521Litigation


6,887



349



721



318



Restructuring and other charges






(98
)






11,087



Impairment of goodwill and other
    intangible assets














4,810



Impairment of equipment


203



795











Total operating expenses


47,143



48,891



44,097



72,713



72,646Loss from operations


(23,237
)


(2,398
)


(7,777
)


(40,358
)


(38,554
)Other income (expense), net


891



513



(339
)


(506
)


1,762Loss before income taxes


(22,346
)


(1,885
)


(8,116
)


(40,864
)


(36,792
)Provision for income taxes






57











Net loss

$
(22,346
)

$
(1,942
)

$
(8,116
)

$
(40,864
)

$
(36,792
)Basic and diluted net loss per
    share

$
(0.54
)

$
(0.05
)

$
(0.20
)

$
(1.04
)

$
(1.03
)Shares used in computing basic and
    diluted net loss per share


41,125



40,463



39,749



39,457



35,714Pro forma basic and diluted net
    loss per share (a)

















$
(0.98
)Shares used in computing pro forma
    basic and diluted net loss per share


















37,483   25




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December 31,2005


2004


2003


2002


2001(In thousands)BALANCE SHEET DATA:Cash, cash equivalents, and short
    term investments

$
38,717


$
66,690


$
57,816


$
60,315


$
73,299Working capital


32,997



52,901



42,655



43,518



64,834Total assets


58,405



88,068



80,422



89,223



131,615Long-term obligations, net of
    current portion


831



487



13



13



6,694Accumulated deficit


(158,120
)


(135,774
)


(133,832
)


(125,715
)


(84,852
)Total shareholders equity


40,074



62,735



59,288



65,287



104,753     (a)
    
    Pro forma basic and diluted net loss per common share for 2001
    gives effect to common stock equivalent shares arising, assuming
    that the preferred stock and convertible note payable were
    converted to common stock upon issuance using the if
    converted method. This pro forma disclosure has been
    included because the preferred stock and convertible note
    payable automatically converted to common stock upon closing of
    our initial public offering in February 2001.  ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
    RESULTS  OF OPERATIONS  Form 10-K.
  OVERVIEW
  ®
    ®
   26




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CRITICAL
    ACCOUNTING POLICIES
    REVENUE
    RECOGNITION
        RESTRUCTURING
    AND OTHER CHARGES
  No. 94-3,
 27




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LONG-LIVED
    ASSETS  IMPAIRMENT
      DERIVATIVE
    INSTRUMENTS
    INVENTORIES  SLOW
    MOVING AND OBSOLESCENCE
    STOCK-BASED
    COMPENSATION EXPENSE
    RESULTS
    OF OPERATIONS
  Years
    Ended December 31, 2005 and 2004
  Revenues.
   28




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Significant Customer.
  Cost of Goods Sold.
  Research and Development Expenses.
  Selling and Marketing Expenses.
  General and Administrative Expenses.
  Litigation Expense. Part 3-Legal
  Impairment Loss.
 29




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Interest Income.
  Interest Expense.
  Provision for Income Taxes.
  Years
    Ended December 31, 2004 and 2003
  Revenues.
          Significant Customer.
  Cost of Goods Sold.
  Research and Development Expenses.
  Selling and Marketing Expenses.
  General and Administrative Expenses.
  Litigation Expense.
  Impairment Loss.
 30




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Restructuring.
  Interest Income.
  Interest Expense.
  Provision for Income Taxes.
  LIQUIDITY
    AND CAPITAL RESOURCES
             31




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
    our progress with our research and development programs;
    the needs we may have to pursue FDA clearances or approvals of
    our products;
    our level of success in selling our products and technologies;
    our ability to establish and maintain successful collaborative
    relationships;
    the costs we incur in securing intellectual property rights,
    whether through patents, licenses or otherwise;
    the costs we incur in enforcing and defending our patent claims
    and other intellectual property rights;
    the need to respond to competitive pressures;
    the possible acquisition of complementary products, businesses
    or technologies; and
    the timing of capital expenditures.  CONTRACTUAL
    OBLIGATIONS
    Less Than


Years


Years


OverTotal


1 Year


2  3


4  5


5 YearsCONTRACTUAL OBLIGATIONSNon-cancelable operating lease
    obligation

$
11,890


$
1,879


$
3,986


$
4,311


$
1,714Capital lease obligations


307



115



147



45



License arrangements


1,772



341



786



645



Long-term debt


1,018



378



590



50



Total obligations

$
14,987


$
2,713


$
5,509


$
5,051


$
1,714     OFF-BALANCE
    SHEET ARRANGEMENTS
    ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK     32




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##### Table of Contents



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  CONSOLIDATED
    FINANCIAL STATEMENTS
  REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
             Internal
    Control  Integrated Framework
      33




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Report of
    Independent Registered Public Accounting Firm
               34




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THIRD
    WAVE TECHNOLOGIES, INC.
  Consolidated
    Balance Sheets
  December 31, 2005


December 31, 2004ASSETSCurrent assets:Cash and cash equivalents

$
27,681,704


$
55,619,981Short-term investments


11,035,000



11,070,000Accounts receivables, net of
    allowance for doubtful accounts of $200,000 and $300,000 at
    December 31, 2005 and December 31, 2004, respectively


3,764,519



5,784,679Inventories


2,248,183



1,236,392Prepaid expenses and other


235,794



260,316Total current assets


44,965,200



73,971,368Equipment and leasehold
    improvements:Machinery and equipment


15,563,119



15,832,489Leasehold improvements


2,346,938



2,277,60417,910,057



18,110,093Less accumulated depreciation


13,192,617



12,139,4234,717,440



5,970,670Assets held for sale






269,000Restricted Cash


805,184



Intangible assets, net of
    accumulated amortization


2,641,620



4,146,372Indefinite-lived intangible assets


1,007,411



1,007,411Goodwill


489,873



489,873Other assets


3,778,000



2,212,935Total assets

$
58,404,728


$
88,067,629LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
6,850,207


$
6,519,005Accrued payroll and related
    liabilities


2,158,870



2,873,506Other accrued liabilities


2,344,835



1,867,361Deferred revenue


121,497



129,530Capital lease obligations due
    within one year


114,693



66,867Long-term debt due within one year


378,551



9,614,127Total current liabilities


11,968,653



21,070,396Long-term debt


639,564



335,069Deferred
    revenue  long-term


145,382



254,434Capital lease
    obligations  long-term


191,924



151,885Other liabilities


5,384,904



3,520,948Shareholders equity:Participating preferred stock,
    Series A, $.001 par value, 10,000,000 shares
    authorized, 0 shares issued and outstanding






Common stock, $.001 par value,
    100,000,000 shares authorized, 41,461,377 shares
    issued, 41,243,377 shares outstanding at December 31,
    2005 and 41,102,764 shares issued and outstanding at
    December 31, 2004


41,461



41,103Additional paid-in capital


199,097,187



198,990,162Unearned stock compensation


(114,892
)


(554,293
)Treasury
    stock  218,000 shares acquired at an
    average price of $4.02 per share


(877,159
)


Foreign currency translation
    adjustment


47,442



31,949Accumulated deficit


(158,119,738
)


(135,774,024
)Total shareholders equity


40,074,301



62,734,897Total liabilities and
    shareholders equity

$
58,404,728


$
88,067,629    35




---



##### Table of Contents



THIRD
    WAVE TECHNOLOGIES, INC.
  Consolidated
    Statements of Operations
  Year Ended
    December 31,2005


2004


2003Revenues:Clinical product sales

$
15,665,519


$
14,950,815


$
8,530,809Research product sales


7,505,286



31,065,312



26,617,488Development revenue










916,664License and royalty revenue


362,372



234,841



193,792Grant revenue


372,483



242,032



61,098Total revenues


23,905,660



46,493,000



36,319,851Operating expenses:Cost of goods sold (including
    amortization of capitalized legal settlement costs of $1,504,752
    in 2005, 2004, and 2003)


7,103,834



12,491,783



12,839,502Research and development


8,389,316



11,636,620



12,035,375Selling and marketing


12,772,439



10,803,381



8,858,678General and administrative


11,787,976



12,913,848



9,642,434Litigation


6,886,928



348,525



720,705Impairment of equipment


202,707



794,716



Restructuring and other charges






(98,000
)


Total operating expense


47,143,200



48,890,873



44,096,694Loss from operations


(23,237,540
)


(2,397,873
)


(7,776,843
)Other income (expense):Interest income


1,714,346



776,295



571,282Interest expense


(457,004
)


(283,240
)


(298,182
)Other


(365,516
)


19,753



(612,493
)Total other income (expense)


891,826



512,808



(339,393
)Loss before income taxes


(22,345,714
)


(1,885,065
)


(8,116,236
)Provision for income taxes






57,341



Net loss

$
(22,345,714
)

$
(1,942,406
)

$
(8,116,236
)Net loss per
    share  basic and diluted

$
(0.54
)

$
(0.05
)

$
(0.20
)    36




---



##### Table of Contents



Third
    Wave Technologies, Inc
  Consolidated
    Statement of Shareholders Equity
  Common Stock








ForeignAdditional


Unearned Stock


Treasury


Currency


AccummulatedPar


Paid in Capital


Compensation


Stock


Translation


Deficit


TotalBalance at December 31, 2002

$
39,560


$
191,581,136


$
(618,246
)

$



$



$
(125,715,382
)

$
65,287,068Common stock issued for stock
    options and stock purchase
    plan  461,670 shares


461



721,568



















722,029Unearned stock compensation






1,162,477



(1,162,477
)














Amortization of unearned stock
    compensation










1,374,377















1,374,377Reversal of unearned stock
    compensation related to terminated employees






(109,060
)


96,350















(12,710
)Net loss






















(8,116,236
)


(8,116,236
)Foreign currency translation
    adjustment


















33,307







33,307Comprehensive loss


























(8,082,929
)Balance at December 31, 2003


40,021



193,356,121



(309,996
)






33,307



(133,831,618
)


59,287,835Common stock issued for stock
    options and stock purchase
    plan  1,081,520 shares


1,082



2,363,289



















2,364,371Unearned stock compensation






3,270,752



(3,270,752
)














Amortization of unearned stock
    compensation










3,026,455















3,026,455Net loss






















(1,942,406
)


(1,942,406
)Foreign currency translation
    adjustment


















(1,358
)






(1,358
)Comprehensive loss


























(1,943,764
)Balance at December 31, 2004


41,103



198,990,162



(554,293
)






31,949



(135,774,024
)


62,734,897Common stock issued for stock
    options and stock purchase
    plan  358,613 shares


358



915,403



















915,761Unearned stock compensation






(808,378
)


808,378















Amortization of unearned stock
    compensation










(368,977
)














(368,977
)Common stock repurchased for
    treasury  218,000 shares














(877,159
)










(877,159
)Net loss






















(22,345,714
)


(22,345,714
)Foreign currency translation
    adjustment


















15,493







15,493Comprehensive loss


























(22,330,221
)Balance at December 31, 2005

$
41,461


$
199,097,187


$
(114,892
)

$
(877,159
)

$
47,442


$
(158,119,738
)

$
40,074,301    37




---



##### Table of Contents



THIRD
    WAVE TECHNOLOGIES, INC.
  Consolidated
    Statements of Cash Flows
  Year Ended
    December 31,2005


2004


2003OPERATING ACTIVITIES:Net loss

$
(22,345,714
)

$
(1,942,406
)

$
(8,116,236
)Adjustments to reconcile net loss
    to net cash provided by (used in) operating activities:Depreciation and amortization


1,705,252



2,107,466



2,607,096Amortization of intangible assets


1,504,752



1,504,752



1,504,752Amortization of licensed technology


398,132



623,956



480,633Noncash stock compensation


(368,977
)


3,026,455



1,361,667Impairment charge and (gain) loss
    on disposal of equipment


208,681



888,817



(410
)Changes in operating assets and
    liabilities:Receivables


1,937,853



(3,724,983
)


697,109Inventories


(1,011,791
)


157,654



266,298Prepaid expenses and other assets


131,298



390,645



809,031Accounts payable


(10,029
)


1,563,571



(2,133,528
)Accrued expenses and other
    liabilities


195,852



1,664,244



224,512Deferred revenue


(117,085
)


316,204



(877,904
)Net cash provided by (used in)
    operating activities


(17,771,776
)


6,576,375



(3,176,980
)INVESTING ACTIVITIES:Purchases of equipment and
    leasehold improvements


(404,934
)


(578,472
)


(249,916
)Proceeds on sale of equipment


197,683



88,320



321,264Purchases of licensed technology


(200,000
)






(100,000
)Change in restricted cash balance


(805,184
)






Purchases of short-term investments


(11,835,000
)


(11,070,000
)


(10,800,000
)Maturities of short-term investments


11,870,000



10,800,000



11,013,000Net cash provided by (used in)
    investing activities


(1,177,435
)


(760,152
)


184,348FINANCING ACTIVITIES:Proceeds from long-term debt


800,000



470,000



Payments on long-term debt


(9,731,081
)


(34,137
)


(15,152
)Payments on capital lease
    obligations


(96,587
)


(12,222
)


Proceeds from issuance of common
    stock, net


915,761



2,364,371



722,029Repurchase of common stock for
    treasury


(877,159
)






Net cash provided by (used in)
    financing activities


(8,989,066
)


2,788,012



706,877Net increase (decrease) in cash and
    cash equivalents


(27,938,277
)


8,604,235



(2,285,755
)Cash and cash equivalents at
    beginning of period


55,619,981



47,015,746



49,301,501Cash and cash equivalents at end of
    period

$
27,681,704


$
55,619,981


$
47,015,746Supplemental disclosure of cash
    flows information  Cash paid for interest

$
468,520


$
277,226


$
301,817Supplemental disclosure of cash
    flows information  Income taxes paid

$
52,754


$



$
          38




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial Statements
 December 31, 2005
  1.
    NATURE OF
    OPERATIONS AND PRINCIPLES OF CONSOLIDATION  PRINCIPLES
    OF CONSOLIDATION
    NATURE
    OF OPERATIONS
  ®
    2.
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES    CASH
    EQUIVALENTS, SHORT-TERM INVESTMENTS, AND RESTRICTED
    CASH
    available-for-sale
   39




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
   INVENTORIES
  first-in,
  December 312005


2004Raw materials

$
1,486,166


$
1,318,771Finished goods and work in process


1,437,017



567,621Reserve for excess and obsolete
    inventory


(675,000
)


(650,000
)Total inventories

$
2,248,183


$
1,236,392   ADVERTISING
    COSTS
    FOREIGN
    CURRENCY TRANSLATION
    EQUIPMENT
    AND LEASEHOLD IMPROVEMENTS
    PATENTS
    GOODWILL
    AND OTHER INTANGIBLE ASSETS
     40




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
       Technology license

$
915,828Trademark


91,583$
1,007,411     December 31, 2005


December 31, 2004Carrying


Accumulated


Carrying


AccumulatedAmount


Amortization


Amount


AmortizationCosts of settling patent litigation

$
10,533,248


$
7,891,628


$
10,533,248


$
6,386,876Reacquired marketing and
    distribution rights


2,211,111



2,211,111



2,211,111



2,211,111Customer agreements


38,000



38,000



38,000



38,000$
12,782,359


$
10,140,739


$
12,782,359


$
8,635,987     2006

$
1,504,7522007

$
1,136,868   IMPAIRMENT
    OF LONG-LIVED ASSETS
    PREPAID
    LICENSE FEES
    DERIVATIVE
    INSTRUMENTS AND HEDGING ACTIVITIES
   41




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    REVENUE
    RECOGNITION
        RESEARCH
    AND DEVELOPMENT
    SHIPPING
    AND HANDLING COSTS
    INCOME
    TAXES
    STOCK-BASED
    COMPENSATION
   42




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Year Ended
    December 31,2005


2004


2003Net loss:As reported

$
(22,345,714
)

$
(1,942,406
)

$
(8,116,236
)Add: Stock-based compensation, as
    recognized


(368,977
)


3,026,455



1,361,667Add: Stock-based compensation
    expense related to stock options determined under
    SFAS No. 123


(10,050,950
)


(4,347,817
)


(4,216,913
)Add: Stock-based compensation
    related to the employee stock purchase plan under
    SFAS No. 123


(207,989
)


(283,898
)


(172,571
)SFAS No. 123 Pro forma

$
(32,973,630
)

$
(3,547,666
)

$
(11,144,053
)Net loss per share:As reported, basic and diluted

$
(0.54
)

$
(0.05
)

$
(0.20
)SFAS No. 123 pro forma,
    basic and diluted

$
(0.80
)

$
(0.09
)

$
(0.28
)   No. 96-18,
  FAIR
    VALUE OF FINANCIAL INSTRUMENTS
    USE OF
    ESTIMATES
    NET
    LOSS PER SHARE
   43




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Year Ended December 312005


2004


2003Net loss

$
(22,345,714
)

$
(1,942,406
)

$
(8,116,236
)Weighted-average shares of common
    stock outstanding  basic and diluted


41,125,000



40,463,000



39,749,000Basic and diluted net loss per
    share

$
(0.54
)

$
(0.05
)

$
(0.20
)Weighted-average shares from
    options that could potentially dilute basic earnings per share
    in the future that are not included in the computation of
    diluted loss per share as their impact is antidilutive (computed
    under the treasury stock method)


1,591,000



2,091,000



1,213,000   NEW
    ACCOUNTING PRONOUNCEMENTS
        RECLASSIFICATION
   44




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
   3.
    CHANGE IN
    ACCOUNTING ESTIMATE      4.
    LONG-TERM
    DEBT    December 312005


2004Notes payable

$
1,018,115


$
9,935,863Other






13,3331,018,115



9,949,196Less current portion


378,551



9,614,127$
639,564


$
335,069     2006

$
378,5512007


368,2982008


221,4902009


49,776     5.
    SHAREHOLDERS
    EQUITY    STOCK
    PURCHASE PLAN
   45




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    STOCK
    OPTION PLANS
      Shares available for grant at
    December 31, 2002


3,198,587Options granted


(2,813,300
)Options forfeited


1,093,405Shares available for grant at
    December 31, 2003


1,478,692Options granted


(2,127,255
)Options forfeited


1,161,928Increase in options available for
    grant


1,500,000Shares available for grant at
    December 31, 2004


2,013,365Options granted


(2,521,790
)Options forfeited


622,964Increase in options available for
    grant


1,800,000Shares available for grant at
    December 31, 2005


1,914,539  46




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Weighted AverageNumber of Shares


Exercise PriceOutstanding at December 31,
    2002


5,743,859


$
5.29Granted


2,813,300



3.42Exercised


(207,249
)


1.75Forfeited


(1,093,405
)


7.32Outstanding at December 31,
    2003


7,256,505



4.37Granted


2,127,255



4.97Exercised


(775,309
)


2.42Forfeited


(1,161,928
)


5.57Outstanding at December 31,
    2004


7,446,523



4.55Granted


2,521,790



4.20Exercised


(244,051
)


2.22Forfeited


(622,964
)


7.20Outstanding at December 31,
    2005


9,101,298


$
4.34Options Exercisable at
    December 31, 2005


5,429,131


$
4.81   Number ofShares








Shares


WtdOutstanding at


Wtd Average


Remaining


Exercisable at


AverageDecember 31,


Exercise


Contractual


December 31,


Exercise2005


Price


Life


2005


PriceOptions granted between $0.27 and
    $1.11


108,200


$
1.00



0.2



108,200


$
1.00Options granted between $1.11 and
    $2.21


891,450


$
1.90



6.1



704,337


$
1.90Options granted between $2.21 and
    $3.32


1,962,762


$
2.77



7.0



991,137


$
2.73Options granted between $3.32 and
    $4.42


3,494,447


$
3.92



7.6



1,430,011


$
3.87Options granted between $4.42 and
    $5.53


579,750


$
4.69



8.3



130,870


$
4.80Options granted between $5.53 and
    $6.64


580,714


$
6.35



5.8



580,601


$
6.35Options granted between $6.64 and
    $7.74


549,125


$
6.89



8.3



549,125


$
6.89Options granted between $7.74 and
    $8.85


837,850


$
8.70



4.6



837,850


$
8.70Options granted between $8.85 and
    $9.96


10,800


$
9.69



3.0



10,800


$
9.69Options granted between $9.96 and
    $11.06


86,200


$
10.91



2.0



86,200


$
10.919,101,298


$
4.34



6.9



5,429,131


$
4.81    47




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  No. 96-18,
    Year Ended December 312005


2004


2003Cost of goods sold

$
24,251


$
155,275


$
86,793Research and development


(501,754
)


1,133,617



504,477Selling and marketing


(5,256
)


144,519



215,935General and administrative


113,782



1,593,044



554,462$
(368,977
)

$
3,026,455


$
1,361,667     6.
    INCOME
    TAXES     48




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     December 312005


2004Deferred tax assets:Patent expense

$
1,930,000


$
1,563,000Stock compensation expense


203,000



609,000Deferred revenue


104,000



154,000Inventory obsolescence


270,000



260,000Accrued liabilities


1,891,000



1,945,000Other


227,000



168,000AMT credit carryforward


39,000



57,000Net operating loss carryforwards


53,440,000



45,321,000Total deferred tax assets


58,104,000



50,077,000Valuation allowance


(56,934,000
)


(48,369,000
)Net deferred tax assets


1,170,000



1,708,000Deferred tax liabilities:Equipment and leasehold
    improvements


(113,000
)


(49,000
)Intangibles


(1,057,000
)


(1,659,000
)Deferred tax liabilities


(1,170,000
)


(1,708,000
)Net deferred tax assets /
    (liabilities)

$



$
     2005


2004


2003Federal statutory rate


(34.0
)%


(34.0
)%


(34.0
)%State taxes


(5.9
)%


(5.1
)%


(5.7
)%Foreign taxes


0.0
%


2.1
%


0.0
%Meals and entertainment


0.2
%


1.7
%


0.4
%Other permanent differences


0.0
%


1.0
%


1.1
%Valuation allowance


39.7
%


37.3
%


38.2
%0.0
%


3.0
%


0.0
%     7.
    LEASE
    OBLIGATIONS   49




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        Capital


OperatingLeases


Leases2006

$
138,100


$
1,879,0002007


116,417



1,954,0002008


53,463



2,032,0002009


36,531



2,113,0002010


12,176



2,198,0002011


0



1,714,000Total minimum lease obligations


356,687


$
11,890,000Less amounts representing interest


50,070Present value of minimum lease
    payments


306,617Less current portion of long-term
    lease obligations


114,693$
191,924     8.
    RESTRUCTURING
    AND OTHER CHARGES       50




---



##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Equipment andLeaseholdImprovements


PrepaymentFacilities


Disposals


Penalties


Other


TotalCharge in 2002

$
2,470,438


$
7,175,995


$
494,930


$
945,870


$
11,087,233Payments made


(312,400
)






(469,300
)






(781,700
)Non-cash charges






(7,175,995
)


(25,630
)


(140,290
)


(7,341,915
)Accrued restructuring balance at
    December 31, 2002


2,158,038











805,580



2,963,618Payments made


(674,809
)










(874,765
)


(1,549,574
)Revision to estimate


(69,185
)










69,185



Accrued restructuring balance at
    December 31, 2003


1,414,044















1,414,044Payments made


(199,196
)














(199,196
)Revision to estimate


(98,000
)














(98,000
)Accrued restructuring balance at
    December 31, 2004


1,116,848















1,116,848Payments made


(159,285
)














(159,285
)Accrued restructuring balance at
    December 31, 2005

$
957,563


$



$



$



$
957,563   9.
    LICENSE
    AGREEMENTS       51




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##### Table of Contents



Third
    Wave Technologies, Inc.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     2006

$
425,0002007


450,0002008


450,0002009


450,0002010


225,000Total payments


2,000,000Less amount representing interest


227,828Present value of payments

$
1,772,172   and/or
  10.
    COLLABORATIVE
    AGREEMENTS    tm ® tm
  11.  401(k)
    PLAN
    12.
    SEGMENT
    DISCLOSURE   52




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##### Table of Contents



2005


2004


2003United States

$
17,027,952


$
13,759,367


$
7,668,573Japan


5,107,455



31,361,485



26,983,342Other


1,035,398



895,275



496,382$
23,170,805


$
46,016,127


$
35,148,297   13.
    QUARTERLY
    FINANCIAL DATA (UNAUDITED)    Quarter EndedMarch 31


June 30


September 30


December 312005:Net revenues

$
7,126


$
5,772


$
5,222


$
5,786Gross margin


5,126



3,960



3,646



4,070Net loss


(4,421
)


(5,514
)


(7,380
)


(5,031
)Basic and diluted net loss per
    share

$
(0.11
)

$
(0.13
)

$
( 0.18
)

$
(0.12
)2004:Net revenues

$
15,276


$
12,632


$
10,479


$
8,106Gross margin


11,105



8,939



8,144



5,813Net income (loss)


2,848



(106
)


24



(4,708
)Basic and diluted net income
    (loss) per share

$
0.07


$
(0.00
)

$
0.00


$
(0.12
)   53




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##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE  Form 8-K,
  ITEM 9A.
    CONTROLS
    AND PROCEDURES  EVALUATION
    OF DISCLOSURE CONTROLS AND PROCEDURES
  Rule 13a-15(b) Rules 13a-15(e)
  EVALUATION
    OF INTERNAL CONTROL OVER FINANCIAL REPORTING
         54




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     Internal Control  Integrated Framework
                55




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##### Table of Contents



ITEM 9B.
    OTHER
    INFORMATION   PART III  ITEM 10.
    DIRECTORS
    AND EXECUTIVE OFFICERS OF THE REGISTRANT    ITEM 11.
    EXECUTIVE
    COMPENSATION    ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
    AND  RELATED STOCKHOLDER MATTERS    ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS    ITEM 14.
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   PART IV  ITEM 15.
    EXHIBITS,
    FINANCIAL STATEMENTS AND SCHEDULES        Schedule II  Valuation and Qualifying
    Accounts.
   56




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##### Table of Contents



SIGNATURES      By:
    /s/  Kevin T. Conroy     POWER OF
    ATTORNEY
  Form 10-K Form 10-K.
    Signature

Title

Date/s/  David A.
    ThompsonDavid
    A. Thompson

Chairman of the Board Chief
    Executive Officer President, and Director

March 10, 2006/s/  Kevin T. ConroyKevin
    T. Conroy

(Principal Executive Officer)

March 9, 2006/s/  James J.
    HerrmannJames
    J. Herrmann

Vice President of Finance
    (Principal Financial Officer)

March 10, 2006/s/  James ConnellyJames
    Connelly

Director

March 8, 2006/s/  Gordon F.
    BrunnerGordon
    F. Brunner

Director

March 10, 2006/s/  Lawrence MurphyLawrence
    Murphy

Director

March 8, 2006/s/  John NeisJohn
    Neis

Director

March 10, 2006/s/  Lionel SterlingLionel
    Sterling

Director

March 8, 2006  57




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##### Table of Contents



EXHIBIT INDEX
  ExhibitNo.

Description

Incorporated by Reference
    to3
.1

Amended and Restated Certificate
    of Incorporation of the Registrant, dated as of August 16,
    2000

Exhibit 3.1(b) to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended3
.2

Amended and Restated Bylaws of the
    Registrant, dated as of July 25, 20054
.1

Investors Rights Agreement,
    dated as of July 24, 2000

Exhibit 4.2 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended4
.2

Rights Agreement between the
    Registrant and EquiServe Trust Company N.A., dated as of
    October 24, 2001

Exhibit 4.9 to the
    Registrants Registration Statement on
    Form 8-A,
    File No. 000-31745, filed on November 30, 20014
.3

Amendment No. 1 to the Rights
    Agreement between the Registrant and EquiServe Trust Company
    N.A., dated February 18, 2003

Exhibit 4.2 to the
    Registrants Registration Statement on
    Form 8-A/A,
    File No. 000-31745, filed on February 19, 200310
.1*

Incentive Stock Option Plan

Exhibit 10.1 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.2*

1997 Incentive Stock Option Plan

Exhibit 10.2 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.3*

1997 Nonqualified Stock Option Plan

Exhibit 10.3 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.4*

1998 Incentive Stock Option Plan

Exhibit 10.4 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.5*

1999 Incentive Stock Option Plan

Exhibit 10.5 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.6*

1999 Nonqualified Stock Option Plan

Exhibit 10.6 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.7*

2000 Stock Plan

Exhibit 10.7 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended 58




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##### Table of Contents



ExhibitNo.

Description

Incorporated by Reference
    to10
.8*

2000 Employee Stock Purchase Plan

Exhibit 10.8 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.9*

Form of Director and Executive
    Officer Indemnification Agreement

Exhibit 10.9 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.10

Lease Agreement, dated as of
    April 1, 1997, between the Registrant and University
    Research Park Facilities Corp. and amendment, dated as of
    September 1, 2001

Exhibit 10.18 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on July 31, 2000, as amended10
.11

Amendment to Lease between
    Registrant and University Research Park Facilities Corp. dated
    as of September 1, 2002

Exhibit 10.11 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 200210
.12

Development and Commercialization
    Agreement, dated as of December 29, 2000, between the
    Registrant and BML, Inc.

Exhibit 10.26 to the
    Registrants Registration Statement on
    Form S-1,
    Registration
    No. 333-42694,
    filed on  July 31, 2000, as amended10
.13

License Agreement dated as of
    October 15, 2002 between Registrant and Aclara Biosciences,
    Inc.

Exhibit 10.14 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 200210
.14*

Employment Agreement between Lance
    Fors and Third Wave Technologies, Inc. dated October 16,
    2003

Exhibit 10.16 to
    Registrants Annual Report on
    From 10-K
    for the fiscal year ended on December 31, 200310
.15*

Employment Agreement between John
    Puisis and Third Wave Technologies, Inc. dated
    September 19, 2001 and Amendment dated July 17, 2003

Exhibit 10.17 to
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 200310
.16*

Amendment No. 2 to Employment
    Agreement between John Puisis and Third Wave Technologies, Inc.
    effective June 14, 2004

Exhibit 10.2 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 200410
.17*

Severance Agreement between John
    Puisis and Third Wave Technologies, Inc. effective
    December 20, 200510
.18*

Third Wave Technologies, Inc.
    Amended LTIP 1

Exhibit 10.17 to
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 200410
.19*

Third Wave Technologies, Inc.
    Amended LTIP 210
.20*

Employment Agreement between
    Maneesh Arora and Third Wave Technologies, Inc. dated
    May 10, 2005

Exhibit 10.1 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 200510
.21*

Employment Agreement between
    Lander Brown and Third Wave Technologies, Inc. dated
    May 10, 2005

Exhibit 10.2 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 200510
.22*

Employment Agreement between
    Vecheslav Elagin and Third Wave Technologies, Inc. dated
    May 10, 2005

Exhibit 10.3 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2005 59




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##### Table of Contents



ExhibitNo.

Description

Incorporated by Reference
    to10
.23*

Employment Agreement between Jacob
    Orville and Third Wave Technologies, Inc. dated May 10, 2005

Exhibit 10.4 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 200510
.24*

Amended and Restated Employment
    Agreement between Kevin T. Conroy and Third Wave Technologies,
    Inc. dated December 23, 2005

Exhibit 10.1 to
    Registrants Current Report on
    Form 8-K
    filed December 30, 200510
.25*

Employment Agreement between James
    J. Herrmann and Third Wave Technologies, Inc. dated
    March 14, 2005

Exhibit 10.23 to the
    Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 200410
.26*

Severance Agreement between James
    J. Herrmann and Third Wave Technologies, Inc. dated
    January 31, 200610
.27*

Amendment No. 1 to Employment
    Agreement between Lance Fors and Third Wave Technologies, Inc.
    dated June 14, 2004

Exhibit 10.2 to
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 200410
.28*

Amendment No. 2 to Employment
    Agreement between Lance Fors and Third Wave Technologies, Inc.
    dated July 25, 2005

Exhibit 10.1 to
    Registrants Current Report on
    Form 8-K
    filed July 28, 200510
.29*

Third Wave Technologies, Inc. LTIP
    3 dated February 14, 200621


List of Subsidiaries23
.1

Consent of Independent Registered
    Public Accounting Firm  Grant Thornton LLP23
.2

Consent of Independent Registered
    Public Accounting Firm  Ernst & Young
    LLP24


Powers of Attorney (contained in
    the signature page hereto)31
.1

CEOs Certification Pursuant
    to Section 302 of the Sarbanes Oxley Act of 200231
.2

Principal Financial Officer
    Certification pursuant to Section 302 of the Sarbanes Oxley
    Act of 200232
.1

CEOs Certification pursuant
    to 18 U.S.C. Section 1350, of Chapter 63 of
    Title 18 of the United States Code32
.2

Principal Financial Officers
    Certification pursuant to 18 U.S.C Section 1350, of
    Chapter 63 of Title 18 of the United States Code     *
    
    Indicated a management contract or compensatory plan or
    arrangement. 60




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##### Table of Contents



SCHEDULE II:
    VALUATION AND QUALIFYING ACCOUNTS
    YEARS ENDED DECEMBER 31, 2005, 2004, AND 2003
  Balance At


AdditionsBeginning


Charged


(1)


Balance AtDescription

of Year


to Expense


Deductions


End of Year(Dollars in thousands)Allowance for doubtful accounts
    receivable:2003

$
465


$
402


$
727


$
1402004

$
140


$
177


$
17


$
3002005

$
300


$
107


$
207


$
200Allowance for excess and obsolete
    inventory:2003

$
3,050


$
1,308


$
3,608


$
7502004

$
750


$
805


$
905


$
6502005

$
650


$
968


$
943


$
675     (1)
    
    Represents amounts written off or disposed, net of recoveries. 61