Safeguard Scientifics Announces Departure of Chief Financial Officer.

Engages Executive Search and Names Acting CFO 

WAYNE, Pa. -- Safeguard Scientifics, Inc. (NYSE:SFE), a holding company which builds value in high-growth, revenue-stage information technology and life sciences companies, today announced that Christopher J. Davis resigned from his position as Executive Vice President and Chief Administrative and Financial Officer in order to pursue other interests.

Peter J. Boni, Safeguard Scientifics' President and Chief Executive Officer stated, "I would like to thank Chris for his contributions over the past six plus years in helping to turn around Safeguard. During Chris' tenure, Safeguard's financial position strengthened significantly, enhancing our ongoing ability to execute against our strategic initiatives." Boni added, "With the sale of Mantas during the fourth quarter, we bolstered our cash position and currently anticipate that Safeguard will deliver a profit in both the fourth quarter and full year 2006. We continue to be excited by the growing number of opportunities that we are evaluating and the progress that our partner companies are making, which ultimately will lead to growing value for Safeguard shareholders."

Safeguard has engaged Heidrick & Struggles, a nationwide executive search firm to identify a replacement for Mr. Davis. In addition, on an interim basis, Safeguard announced that Stephen Zarrilli, co-founder of the Penn Valley Group, has joined the company as Acting CFO until a permanent replacement is identified. Mr. Boni stated, "We are very pleased that we were able to appoint a proven executive with a broad set of skills to serve as acting CFO, which provides me with a high degree of confidence that Safeguard will be able to execute a smooth transition process."

Mr. Zarrilli is a co-founder of the Penn Valley Group, a middle-market management advisory and private equity firm, and serves as one of its Managing Partners. Prior to the creation of the Penn Valley Group, Mr. Zarrilli served as the Chief Financial Officer of Blue Bell, PA based Fiberlink Communications Corp., a leading provider of remote access VPN solutions for large enterprises. Mr. Zarrilli's prior experience includes serving both as the Chief Financial Officer and then Chief Executive Officer of US Interactive, Inc. where he led the company's initial and secondary Public Offerings. Mr. Zarrilli also served as Chief Executive Officer of Concellera Software, Inc., orchestrating the sale of its proprietary technology to Hewlett Packard, and spent over a decade with Deloitte & Touche, where he was responsible for developing an emerging business practice for the firm in Philadelphia. In addition to his current duties, Mr. Zarrilli is a Director and the Chairman of the Audit Committee of NutriSystem, Inc. (NASDAQ:NTRI).

Mr. Zarrilli plans to continue his role as Managing Director with Penn Valley Group following his transition role at Safeguard.

About Safeguard

Safeguard Scientifics, Inc. (NYSE:SFE) builds value in high-growth, revenue-stage information technology and life sciences businesses. We provide growth capital as well as a range of strategic, operational and management resources to our partner companies. Safeguard participates in expansion financings, corporate spin-outs, management buyouts, recapitalizations, industry consolidations and early-stage financings. www.safeguard.com.

Except for the historical information and discussions contained herein, statements contained in this release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Our forward-looking statements are subject to risks and uncertainties. These forward-looking statements that could cause actual results to differ materially, include, among others, managing rapidly changing technologies, limited access to capital, competition, the ability to attract and retain qualified employees, the ability to execute our strategy, the uncertainty of the future performance of our companies, acquisitions and dispositions of companies, the inability to manage growth, compliance with government regulations and legal liabilities, additional financing requirements, labor disputes, the effect of economic conditions in the business sectors in which our companies operate, and other uncertainties described in the Company's filings with the Securities and Exchange Commission. Many of these factors are beyond our ability to predict or control. In addition, as a result of these and other factors, our past financial performance should not be relied on as an indication of future performance. The Company does not assume any obligation to update any forward-looking statements or other information contained in this press release.