Pennsylvania
|
|
23-1609753
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
100 Matsonford Road
One Radnor Corporate Center, Suite 110
Radnor, PA
|
|
19087
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock ($.10 par value)
|
|
New York Stock Exchange
|
Large accelerated filer £
|
Accelerated filer þ
|
|
Smaller reporting company þ
|
Non-accelerated filer £
|
|
Emerging growth company £
|
|
Page
|
|
|
|
|
|
|
|
|
•
|
Supporting our existing companies;
|
•
|
Helping our companies achieve additional market penetration, revenue growth, cash flow improvement and growth in long-term value; and
|
•
|
Pursuing monetization opportunities for our ownership interests.
|
•
|
defining short and long-term strategic goals;
|
•
|
identifying and planning for the critical success factors to reach these goals;
|
•
|
identifying and addressing the challenges and operational improvements required to achieve the critical success factors and, ultimately, the strategic goals;
|
•
|
identifying and implementing the business measurements that we and others will apply to measure a company’s success; and
|
•
|
identifying sources of and providing capital to drive growth.
|
Moxe Health Corporation
|
Expansion
|
(Safeguard Ownership: 29.9%)
|
InfoBionic, Inc.
|
Traction
|
(Safeguard Ownership: 25.2%)
|
meQuilibrium
|
Traction
|
(Safeguard Ownership: 32.7%)
|
Trice Medical, Inc.
|
Traction
|
(Safeguard Ownership: 16.6%)
|
Zipnosis, Inc.
|
Traction
|
(Safeguard Ownership: 37.7%)
|
Sonobi, Inc.
|
Traction
|
(Safeguard Ownership: 21.6%)
|
QuanticMind, Inc.
|
Traction
|
(Safeguard Ownership: 24.2%)
|
WebLinc, Inc.
|
Traction
|
(Safeguard Ownership: 38.5%)
|
Lumesis, Inc.
|
Traction
|
(Safeguard Ownership: 43.5%)
|
Clutch Holdings, Inc.
|
High Traction
|
(Safeguard Ownership: 41.2%)
|
Prognos Health Inc.
|
High Traction
|
(Safeguard Ownership: 28.7%)
|
Aktana, Inc.
|
Greater than $15 million
|
(Safeguard Ownership: 17.8%)
|
Flashtalking, Inc.
|
Greater than $15 million
|
(Safeguard Ownership: 10.1%)
|
MediaMath, Inc.
|
Greater than $15 million
|
(Safeguard Ownership: 13.3%)
|
Syapse, Inc.
|
Greater than $15 million
|
(Safeguard Ownership: 20.0%)
|
•
|
most of our companies have a history of operating losses and/or limited operating history;
|
•
|
the intense competition affecting the products and services our companies offer could adversely affect their businesses, financial condition, results of operations and prospects for growth;
|
•
|
the inability to adapt to changing marketplaces;
|
•
|
the inability to manage growth;
|
•
|
the need for additional capital to fund their operations, which we may not be able to fund or which may not be available from third parties on acceptable terms, if at all;
|
•
|
the inability to protect their proprietary rights and/or infringing on the proprietary rights of others;
|
•
|
that our companies could face legal liabilities from claims made against them based upon their operations, products or work;
|
•
|
the impact of economic downturns on their operations, results and growth prospects;
|
•
|
the inability to attract and retain qualified personnel;
|
•
|
the existence of government regulations and legal uncertainties may place financial burdens on the businesses of our companies; and
|
•
|
the inability to plan for and manage catastrophic events.
|
•
|
the management teams or other equity or debt holders of our companies having economic or business interests or objectives that are different from ours; and
|
•
|
the companies not taking our advice with respect to the financial or operating issues they may encounter.
|
•
|
rapidly changing technology;
|
•
|
evolving industry standards;
|
•
|
frequent introduction of new products and services;
|
•
|
shifting distribution channels;
|
•
|
evolving government regulation;
|
•
|
frequently changing intellectual property landscapes; and
|
•
|
changing customer demands.
|
•
|
improve, upgrade and expand their business infrastructures;
|
•
|
scale up production operations;
|
•
|
develop appropriate financial reporting controls;
|
•
|
attract and retain qualified personnel; and
|
•
|
maintain appropriate levels of liquidity.
|
Name
|
Age
|
|
Position
|
|
Executive Officer Since
|
Brian J. Sisko
|
59
|
|
President and Chief Executive Officer
|
|
2007
|
Mark A. Herndon
|
50
|
|
Senior Vice President and Chief Financial Officer
|
|
2018
|
|
High
|
|
Low
|
||||
Fiscal year 2019:
|
|
|
|
||||
First quarter
|
$
|
11.66
|
|
|
$
|
8.36
|
|
Second quarter
|
12.91
|
|
|
10.59
|
|
||
Third quarter
|
12.79
|
|
|
10.92
|
|
||
Fourth quarter
|
12.43
|
|
|
10.57
|
|
||
Fiscal year 2018:
|
|
|
|
||||
First quarter
|
$
|
13.10
|
|
|
$
|
10.83
|
|
Second quarter
|
13.95
|
|
|
11.95
|
|
||
Third quarter
|
13.18
|
|
|
8.85
|
|
||
Fourth quarter
|
9.88
|
|
|
7.98
|
|
Period
|
Total Number
of Shares
Purchased (a)
|
|
Average
Price Paid
Per Share
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced
Plan (b)
|
|
Maximum Number (or Approximate Dollar Value) of
Shares that May Yet Be
Purchased Under the
Plan (b)
|
||||||
October 1, 2019 - October 31, 2019
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
14,636,135
|
|
November 1, 2019 - November 30, 2019
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
14,636,135
|
|
December 1, 2019 - December 31, 2019
|
2,180
|
|
|
$
|
11.92
|
|
|
—
|
|
|
$
|
14,636,135
|
|
Total
|
2,180
|
|
|
$
|
11.92
|
|
|
—
|
|
|
|
|
|
Year Ended December 31,
|
|||||||
Accounting Method
|
|
2019
|
|
2018
|
|
||||
|
|
(In thousands)
|
|||||||
Equity
|
|
$
|
2,965
|
|
|
$
|
12,626
|
|
|
Other
|
|
47
|
|
|
1,097
|
|
|
||
Total
|
|
$
|
3,012
|
|
|
$
|
13,723
|
|
|
|
Safeguard Primary Ownership
as of December 31, |
|
|||
Company Name
|
2019
|
|
2018
|
|
Accounting Method
|
Aktana, Inc.
|
17.8%
|
|
18.9%
|
|
Equity
|
Clutch Holdings, Inc.
|
41.2%
|
|
41.2%
|
|
Equity
|
Flashtalking *
|
10.1%
|
|
10.1%
|
|
Other
|
InfoBionic, Inc.
|
25.2%
|
|
25.4%
|
|
Equity
|
Lumesis, Inc.
|
43.5%
|
|
43.7%
|
|
Equity
|
MediaMath, Inc. **
|
13.3%
|
|
13.4%
|
|
Other
|
meQuilibrium
|
32.7%
|
|
33.1%
|
|
Equity
|
Moxe Health Corporation
|
29.9%
|
|
32.4%
|
|
Equity
|
Prognos Health Inc.
|
28.7%
|
|
28.7%
|
|
Equity
|
QuanticMind, Inc.
|
24.2%
|
|
24.2%
|
|
Equity
|
Sonobi, Inc.
|
21.6%
|
|
21.6%
|
|
Equity
|
Syapse, Inc.
|
20.0%
|
|
20.0%
|
|
Equity
|
T-REX Group, Inc.
|
13.7%
|
|
21.1%
|
|
Other
|
Trice Medical, Inc.
|
16.6%
|
|
17.4%
|
|
Equity
|
WebLinc, Inc.
|
38.5%
|
|
38.5%
|
|
Equity
|
Zipnosis, Inc
|
37.7%
|
|
34.7%
|
|
Equity
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
Variance
|
||||||
|
(In thousands)
|
||||||||||
General and administrative expense
|
$
|
(9,982
|
)
|
|
$
|
(16,871
|
)
|
|
$
|
6,889
|
|
Other income (loss), net
|
12,255
|
|
|
(5,158
|
)
|
|
17,413
|
|
|||
Interest income
|
2,044
|
|
|
2,806
|
|
|
(762
|
)
|
|||
Interest expense
|
(14,023
|
)
|
|
(16,067
|
)
|
|
2,044
|
|
|||
Equity income (loss), net
|
64,267
|
|
|
19,661
|
|
|
44,606
|
|
|||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
|
$
|
70,190
|
|
Year ended December 31:
|
2019
|
2018
|
||||
|
(In thousands)
|
|||||
Gains on sales of ownership interests
|
$
|
85,834
|
|
$
|
67,980
|
|
Unrealized dilution gains
|
3,206
|
|
9,154
|
|
||
Gains from proceeds received from escrow
|
4,305
|
|
1,838
|
|
||
Loss on impairments
|
(2,965
|
)
|
(12,626
|
)
|
||
Share of losses of our equity method companies, net
|
(26,113
|
)
|
(46,685
|
)
|
||
|
$
|
64,267
|
|
$
|
19,661
|
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Net cash used in operating activities
|
$
|
(19,970
|
)
|
|
$
|
(26,035
|
)
|
Net cash provided by investing activities
|
126,303
|
|
|
32,103
|
|
||
Net cash used in financing activities
|
(89,483
|
)
|
|
(24,952
|
)
|
||
|
$
|
16,850
|
|
|
$
|
(18,884
|
)
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
2020
|
|
2021 and
2022
|
|
2023 and
2024
|
|
After
2024
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Contractual Cash Obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating leases (a)
|
$
|
3.9
|
|
|
$
|
0.7
|
|
|
$
|
1.2
|
|
|
$
|
1.2
|
|
|
$
|
0.8
|
|
Severance payments
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total Contractual Cash Obligations (b)
|
$
|
4.0
|
|
|
$
|
0.8
|
|
|
$
|
1.2
|
|
|
$
|
1.2
|
|
|
$
|
0.8
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
In 2015, we entered into an agreement for the lease of our former principal executive offices which expires in April 2026. In March 2019, we entered into a sublease for these offices which is expected to result in future aggregate sublease receipts of $3.5 million through April 2026.
|
(b)
|
The maximum aggregate exposure under employment and severance agreements for remaining employees was approximately $4.0 million at December 31, 2019 (not reflected in the table above).
|
|
|
|
Page
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
25,028
|
|
|
$
|
7,703
|
|
Restricted cash
|
25
|
|
|
500
|
|
||
Marketable securities
|
—
|
|
|
37,955
|
|
||
Prepaid expenses and other current assets
|
1,297
|
|
|
577
|
|
||
Total current assets
|
26,350
|
|
|
46,735
|
|
||
Property and equipment, net
|
2,101
|
|
|
808
|
|
||
Ownership interests and advances
|
77,129
|
|
|
95,585
|
|
||
Other assets
|
1,997
|
|
|
2,609
|
|
||
Total Assets
|
$
|
107,577
|
|
|
$
|
145,737
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
39
|
|
|
$
|
165
|
|
Accrued compensation and benefits
|
1,364
|
|
|
3,433
|
|
||
Accrued expenses and other current liabilities
|
627
|
|
|
2,182
|
|
||
Credit facility - current
|
—
|
|
|
22,100
|
|
||
Credit facility repayment feature
|
—
|
|
|
5,060
|
|
||
Lease liability - current
|
399
|
|
|
—
|
|
||
Total current liabilities
|
2,429
|
|
|
32,940
|
|
||
Other long-term liabilities
|
1,027
|
|
|
2,804
|
|
||
Lease liability - non-current
|
2,380
|
|
|
—
|
|
||
Credit facility - non-current
|
—
|
|
|
43,014
|
|
||
Total Liabilities
|
5,836
|
|
|
78,758
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
||||
Equity:
|
|
|
|
||||
Preferred stock, $0.10 par value; 1,000 shares authorized
|
—
|
|
|
—
|
|
||
Common stock, $0.10 par value; 83,333 shares authorized; 21,573 issued at December 31, 2019 and 2018, respectively
|
2,157
|
|
|
2,157
|
|
||
Additional paid-in capital
|
810,856
|
|
|
810,928
|
|
||
Treasury stock, at cost; 930 and 914 shares at December 31, 2019 and 2018, respectively
|
(14,024
|
)
|
|
(15,001
|
)
|
||
Accumulated deficit
|
(697,223
|
)
|
|
(731,105
|
)
|
||
Accumulated other comprehensive loss
|
(25
|
)
|
|
—
|
|
||
Total Equity
|
101,741
|
|
|
66,979
|
|
||
Total Liabilities and Equity
|
$
|
107,577
|
|
|
$
|
145,737
|
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
General and administrative expense
|
$
|
9,982
|
|
|
$
|
16,871
|
|
Operating loss
|
(9,982
|
)
|
|
(16,871
|
)
|
||
Other income (loss), net
|
12,255
|
|
|
(5,158
|
)
|
||
Interest income
|
2,044
|
|
|
2,806
|
|
||
Interest expense
|
(14,023
|
)
|
|
(16,067
|
)
|
||
Equity income (loss), net
|
64,267
|
|
|
19,661
|
|
||
Net income (loss) before income taxes
|
54,561
|
|
|
(15,629
|
)
|
||
Income tax benefit (expense)
|
—
|
|
|
—
|
|
||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
Net income (loss) per share:
|
|
|
|
||||
Basic
|
$
|
2.64
|
|
|
$
|
(0.76
|
)
|
Diluted
|
$
|
2.64
|
|
|
$
|
(0.76
|
)
|
Weighted average shares used in computing net income (loss) per share:
|
|
|
|
||||
Basic
|
20,636
|
|
|
20,544
|
|
||
Diluted
|
20,636
|
|
|
20,544
|
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
Other comprehensive (loss) income:
|
|
|
|
||||
Share of other comprehensive (loss) income of equity method investments
|
(31
|
)
|
|
113
|
|
||
Reclassification adjustment for sale of equity method investments
|
6
|
|
|
—
|
|
||
Total comprehensive income (loss)
|
$
|
54,536
|
|
|
$
|
(15,516
|
)
|
|
|
|
|
|
Accumulated Other Comprehensive Loss
|
|
|
|
|
||||||||||||||||||||
|
|
|
Accumulated
Deficit
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury Stock
|
|||||||||||||||||||
|
Total
|
|
|
|
Shares
|
|
Amount
|
|
|
Shares
|
|
Amount
|
|||||||||||||||||
Balance — December 31, 2017
|
$
|
81,796
|
|
|
$
|
(715,476
|
)
|
|
$
|
(113
|
)
|
|
21,573
|
|
|
$
|
2,157
|
|
|
$
|
812,536
|
|
|
999
|
|
|
$
|
(17,308
|
)
|
Net loss
|
(15,629
|
)
|
|
(15,629
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock options exercised, net of tax withholdings
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
16
|
|
||||||
Restricted stock awards, forfeitures and shares repurchased for tax withholdings, net
|
(267
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,558
|
)
|
|
(85
|
)
|
|
2,291
|
|
||||||
Stock-based compensation
|
966
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
966
|
|
|
—
|
|
|
—
|
|
||||||
Other comprehensive income
|
113
|
|
|
—
|
|
|
113
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance — December 31, 2018
|
$
|
66,979
|
|
|
$
|
(731,105
|
)
|
|
$
|
—
|
|
|
21,573
|
|
|
$
|
2,157
|
|
|
$
|
810,928
|
|
|
914
|
|
|
$
|
(15,001
|
)
|
Net income
|
54,561
|
|
|
54,561
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Restricted stock awards, forfeitures and shares repurchased for tax withholdings, net
|
(236
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,213
|
)
|
|
16
|
|
|
977
|
|
||||||
Stock-based compensation
|
1,141
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,141
|
|
|
—
|
|
|
—
|
|
||||||
Other comprehensive loss
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends paid
|
(20,679
|
)
|
|
(20,679
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance — December 31, 2019
|
$
|
101,741
|
|
|
$
|
(697,223
|
)
|
|
$
|
(25
|
)
|
|
21,573
|
|
|
$
|
2,157
|
|
|
$
|
810,856
|
|
|
930
|
|
|
$
|
(14,024
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
||||
Cash Flows from Operating Activities:
|
|
|
|
|
||||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
|
Adjustments to reconcile to net cash used in operating activities:
|
|
|
|
|
||||
Depreciation
|
808
|
|
|
692
|
|
|
||
Amortization of debt discount
|
3,454
|
|
|
4,513
|
|
|
||
Amortization of right of use asset
|
260
|
|
|
—
|
|
|
||
Equity income, net
|
(64,267
|
)
|
|
(19,661
|
)
|
|
||
(Income) loss from change in fair value of derivative
|
(5,060
|
)
|
|
4,541
|
|
|
||
Gain from observable price changes
|
(4,526
|
)
|
|
(1,415
|
)
|
|
||
Other, net
|
(2,268
|
)
|
|
2,044
|
|
|
||
Stock-based compensation, including liability classified awards
|
1,237
|
|
|
966
|
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Prepaid expenses and other current assets
|
(823
|
)
|
|
(2,065
|
)
|
|
||
Accounts payable, accrued expenses, and other
|
(3,346
|
)
|
|
(21
|
)
|
|
||
Net cash used in operating activities
|
(19,970
|
)
|
|
(26,035
|
)
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
||||
Acquisitions of ownership interests
|
(11,640
|
)
|
|
(3,250
|
)
|
|
||
Proceeds from sales and distributions
|
104,302
|
|
|
67,387
|
|
|
||
Advances and loans
|
(5,055
|
)
|
|
(13,104
|
)
|
|
||
Repayment of advances and loans
|
750
|
|
|
10,730
|
|
|
||
Purchase of marketable securities
|
(57,243
|
)
|
|
(37,809
|
)
|
|
||
Proceeds, from sales and maturities in securities
|
95,189
|
|
|
8,148
|
|
|
||
Proceeds from sales of property and equipment
|
—
|
|
|
1
|
|
|
||
Net cash provided by investing activities
|
126,303
|
|
|
32,103
|
|
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
||||
Payment of dividend
|
(20,679
|
)
|
|
—
|
|
|
||
Proceeds from credit facility
|
—
|
|
|
35,000
|
|
|
||
Issuance costs of credit facility
|
—
|
|
|
(2,252
|
)
|
|
||
Repayments on credit facility
|
(68,568
|
)
|
|
(16,433
|
)
|
|
||
Repurchase of convertible senior debentures
|
—
|
|
|
(41,000
|
)
|
|
||
Tax withholdings related to equity-based awards
|
(236
|
)
|
|
(267
|
)
|
|
||
Net cash used in financing activities
|
(89,483
|
)
|
|
(24,952
|
)
|
|
||
Net change in cash, cash equivalents and restricted cash equivalents
|
16,850
|
|
|
(18,884
|
)
|
|
||
Cash, cash equivalents and restricted cash equivalents at beginning of period
|
8,203
|
|
|
27,087
|
|
|
||
Cash, cash equivalents and restricted cash equivalents at end of period
|
$
|
25,053
|
|
|
$
|
8,203
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Cash and cash equivalents
|
$
|
25,028
|
|
|
$
|
7,703
|
|
Restricted cash
|
25
|
|
|
500
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
25,053
|
|
|
$
|
8,203
|
|
|
Operating lease payments
|
Expected sublease receipts
|
||||
|
(In thousands)
|
|||||
2020
|
$
|
707
|
|
$
|
509
|
|
2021
|
595
|
|
525
|
|
||
2022
|
601
|
|
540
|
|
||
2023
|
607
|
|
556
|
|
||
2024
|
613
|
|
573
|
|
||
2025
|
619
|
|
590
|
|
||
Thereafter
|
207
|
|
199
|
|
||
Total future minimum lease payments
|
3,949
|
|
$
|
3,492
|
|
|
Less imputed interest
|
(1,170
|
)
|
|
|||
Total operating lease liabilities
|
$
|
2,779
|
|
|
||
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(In thousands)
|
||||||
Equity Method:
|
|
|
|
||||
Companies
|
$
|
34,271
|
|
|
$
|
64,097
|
|
Private equity funds
|
271
|
|
|
392
|
|
||
|
34,542
|
|
|
64,489
|
|
||
Other Method:
|
|
|
|
||||
Companies
|
27,031
|
|
|
15,260
|
|
||
Private equity funds
|
453
|
|
|
511
|
|
||
|
27,484
|
|
|
15,771
|
|
||
Advances to companies
|
15,103
|
|
|
15,325
|
|
||
|
$
|
77,129
|
|
|
$
|
95,585
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Balance Sheets:
|
|
|
|
||||
Current assets
|
$
|
91,968
|
|
|
$
|
168,659
|
|
Non-current assets
|
26,231
|
|
|
24,432
|
|
||
Total assets
|
$
|
118,199
|
|
|
$
|
193,091
|
|
Current liabilities
|
$
|
80,783
|
|
|
$
|
88,988
|
|
Non-current liabilities
|
87,081
|
|
|
109,924
|
|
||
Shareholders’ equity
|
(49,665
|
)
|
|
(5,821
|
)
|
||
Total liabilities and shareholders’ equity
|
$
|
118,199
|
|
|
$
|
193,091
|
|
|
|
|
|
||||
Number of equity method ownership interests
|
13
|
|
|
19
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
||||
|
(In thousands)
|
|||||||
Results of Operations:
|
|
|
|
|
||||
Revenue
|
$
|
145,632
|
|
|
$
|
283,009
|
|
|
Gross profit
|
$
|
78,465
|
|
|
$
|
181,571
|
|
|
Net loss
|
$
|
(127,007
|
)
|
|
$
|
(154,696
|
)
|
|
|
Carrying
Value
|
|
Fair Value Measurement at December 31, 2019
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
|
(in thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
25,028
|
|
|
$
|
25,028
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash equivalents
|
25
|
|
|
25
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
Carrying
Value
|
|
Fair Value Measurement at December 31, 2018
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
7,703
|
|
|
$
|
7,703
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash equivalents
|
500
|
|
|
500
|
|
|
—
|
|
|
—
|
|
||||
Marketable securities—held-to-maturity:
|
|
|
|
|
|
|
|
||||||||
Government agency bond
|
$
|
21,473
|
|
|
$
|
21,473
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. Treasury Bills
|
16,482
|
|
|
16,482
|
|
|
—
|
|
|
—
|
|
||||
Total marketable securities
|
$
|
37,955
|
|
|
$
|
37,955
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Credit facility repayment feature liability
|
$
|
5,060
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,060
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
||||
|
(In thousands)
|
|||||||
General and administrative expense
|
$
|
1,237
|
|
|
$
|
966
|
|
|
|
$
|
1,237
|
|
|
$
|
966
|
|
|
|
Shares
|
|
Weighted
Average
Exercise Price
|
|
Weighted Average
Remaining
Contractual Life
|
|
Aggregate
Intrinsic
Value
|
||||
|
(In thousands)
|
|
|
|
(In years)
|
|
(In thousands)
|
||||
Outstanding at January 1, 2018
|
569
|
|
|
14.74
|
|
|
|
|
|
||
Options granted
|
—
|
|
|
—
|
|
|
|
|
|
||
Options exercised
|
(15
|
)
|
|
12.29
|
|
|
|
|
|
||
Options canceled/forfeited
|
(144
|
)
|
|
15.21
|
|
|
|
|
|
||
Outstanding at December 31, 2018
|
410
|
|
|
14.66
|
|
|
|
|
|
||
Options granted
|
—
|
|
|
—
|
|
|
|
|
|
||
Options exercised
|
—
|
|
|
—
|
|
|
|
|
|
||
Options canceled/forfeited
|
(231
|
)
|
|
14.19
|
|
|
|
|
|
||
Outstanding at December 31, 2019
|
179
|
|
|
15.27
|
|
|
1.65
|
|
$
|
—
|
|
Options exercisable at December 31, 2019
|
89
|
|
|
15.38
|
|
|
1.35
|
|
—
|
|
|
Shares available for future grant
|
2,602
|
|
|
|
|
|
|
|
|
Shares
|
|
Weighted Average
Grant Date Fair
Value
|
|||
|
(In thousands)
|
|
|
|||
Unvested at January 1, 2018
|
1,005
|
|
|
$
|
14.21
|
|
Granted
|
54
|
|
|
9.47
|
|
|
Vested
|
(121
|
)
|
|
12.87
|
|
|
Forfeited
|
(161
|
)
|
|
14.21
|
|
|
Unvested at December 31, 2018
|
777
|
|
|
14.08
|
|
|
Granted
|
31
|
|
|
12.12
|
|
|
Vested
|
(107
|
)
|
|
11.79
|
|
|
Forfeited
|
(414
|
)
|
|
14.28
|
|
|
Unvested at December 31, 2019
|
287
|
|
|
14.44
|
|
|
Year Ended December 31,
|
|||||
|
2019
|
|
2018
|
|
||
Statutory tax (benefit) expense
|
21.0
|
%
|
|
(21.0
|
)%
|
|
Increase (decrease) in taxes resulting from:
|
|
|
|
|
||
Nondeductible expenses
|
0.4
|
|
|
1.5
|
|
|
Valuation allowance
|
(21.4
|
)
|
|
19.5
|
|
|
|
0.0
|
%
|
|
0.0
|
%
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In thousands)
|
||||||
Deferred tax asset:
|
|
|
|
||||
Carrying values of ownership interests and other holdings
|
$
|
32,760
|
|
|
$
|
60,951
|
|
Tax loss and credit carryforwards
|
70,914
|
|
|
62,901
|
|
||
Disallowed interest carryforwards
|
7,292
|
|
|
3,831
|
|
||
Credit facility repayment feature
|
—
|
|
|
1,312
|
|
||
Accrued expenses
|
213
|
|
|
675
|
|
||
Stock-based compensation
|
432
|
|
|
550
|
|
||
Other
|
604
|
|
|
1,034
|
|
||
|
112,215
|
|
|
131,254
|
|
||
Valuation allowance
|
(112,215
|
)
|
|
(131,254
|
)
|
||
Net deferred tax asset
|
$
|
—
|
|
|
$
|
—
|
|
|
Total
|
||
|
(In thousands)
|
||
2020
|
$
|
—
|
|
2021
|
3,728
|
|
|
2022
|
48,848
|
|
|
2023
|
20,981
|
|
|
2024 and thereafter
|
229,615
|
|
|
|
$
|
303,172
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
||||
|
(In thousands, except per share data)
|
|||||||
Basic:
|
|
|
|
|
||||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
|
Weighted average common shares outstanding
|
20,636
|
|
|
20,544
|
|
|
||
Net income (loss) per share
|
$
|
2.64
|
|
|
$
|
(0.76
|
)
|
|
Diluted:
|
|
|
|
|
||||
Net income (loss)
|
$
|
54,561
|
|
|
$
|
(15,629
|
)
|
|
Weighted average common shares outstanding
|
20,636
|
|
|
20,544
|
|
|
||
Net income (loss) per share
|
$
|
2.64
|
|
|
$
|
(0.76
|
)
|
|
•
|
At December 31, 2019 and 2018, options to purchase 0.2 million and 0.4 million shares of common stock, respectively, at prices ranging from $10.37 to $18.45 per share, and $9.83 to $19.95 per share per share, respectively, were excluded from the calculation.
|
•
|
At December 31, 2019 and 2018, unvested restricted stock, performance-based stock units and DSUs convertible into 0.3 million and 0.8 million shares of stock, respectively, were excluded from the calculations.
|
•
|
For the year ended December 31, 2018, 0.8 million shares of common stock, respectively, representing the effect of assumed conversion of the 2018 Debentures were excluded from the calculations.
|
|
|
|
Safeguard Primary Ownership
as of December 31, |
|
|
|||
Company Name
|
|
|
2019
|
|
2018
|
|
|
Accounting Method
|
Aktana, Inc.
|
|
|
17.8%
|
|
18.9%
|
|
|
Equity
|
Clutch Holdings, Inc.
|
|
|
41.2%
|
|
41.2%
|
|
|
Equity
|
Flashtalking, Inc.*
|
|
|
10.1%
|
|
10.1%
|
|
|
Other
|
InfoBionic, Inc.
|
|
|
25.2%
|
|
25.4%
|
|
|
Equity
|
Lumesis, Inc.
|
|
|
43.5%
|
|
43.7%
|
|
|
Equity
|
MediaMath, Inc. **
|
|
|
13.3%
|
|
13.4%
|
|
|
Other
|
meQuilibrium
|
|
|
32.7%
|
|
33.1%
|
|
|
Equity
|
Moxe Health Corporation
|
|
|
29.9%
|
|
32.4%
|
|
|
Equity
|
Prognos Health Inc.
|
|
|
28.7%
|
|
28.7%
|
|
|
Equity
|
QuanticMind, Inc.
|
|
|
24.2%
|
|
24.2%
|
|
|
Equity
|
Sonobi, Inc.
|
|
|
21.6%
|
|
21.6%
|
|
|
Equity
|
Syapse, Inc.
|
|
|
20.0%
|
|
20.0%
|
|
|
Equity
|
T-REX Group, Inc.
|
|
|
13.7%
|
|
21.1%
|
|
|
Other
|
Trice Medical, Inc.
|
|
|
16.6%
|
|
17.4%
|
|
|
Equity
|
WebLinc, Inc.
|
|
|
38.5%
|
|
38.5%
|
|
|
Equity
|
Zipnosis, Inc
|
|
|
37.7%
|
|
34.7%
|
|
|
Equity
|
|
Three Months Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30 (b)
|
|
December 31 (b)
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
2019:
|
|
|
|
|
|
|
|
||||||||
General and administrative expense
|
$
|
3,057
|
|
|
$
|
2,603
|
|
|
$
|
2,262
|
|
|
$
|
2,060
|
|
Operating loss
|
(3,057
|
)
|
|
(2,603
|
)
|
|
(2,262
|
)
|
|
(2,060
|
)
|
||||
Other income (loss), net
|
(1,885
|
)
|
|
3,118
|
|
|
8,777
|
|
|
2,245
|
|
||||
Interest income
|
873
|
|
|
763
|
|
|
234
|
|
|
174
|
|
||||
Interest expense
|
(2,535
|
)
|
|
(5,682
|
)
|
|
(5,806
|
)
|
|
—
|
|
||||
Equity income (loss), net
|
28,267
|
|
|
40,497
|
|
|
(3,440
|
)
|
|
(1,057
|
)
|
||||
Net loss before income taxes
|
21,663
|
|
|
36,093
|
|
|
(2,497
|
)
|
|
(698
|
)
|
||||
Income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
21,663
|
|
|
$
|
36,093
|
|
|
$
|
(2,497
|
)
|
|
$
|
(698
|
)
|
Net income (loss) per share (a)
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.05
|
|
|
$
|
1.75
|
|
|
$
|
(0.12
|
)
|
|
$
|
(0.03
|
)
|
Diluted
|
$
|
1.05
|
|
|
$
|
1.75
|
|
|
$
|
(0.12
|
)
|
|
$
|
(0.03
|
)
|
2018:
|
|
|
|
|
|
|
|
||||||||
General and administrative expense
|
$
|
5,589
|
|
|
$
|
5,148
|
|
|
$
|
3,516
|
|
|
$
|
2,618
|
|
Operating loss
|
(5,589
|
)
|
|
(5,148
|
)
|
|
(3,516
|
)
|
|
(2,618
|
)
|
||||
Other income (loss), net
|
(1,435
|
)
|
|
(2,452
|
)
|
|
(1,078
|
)
|
|
(193
|
)
|
||||
Interest income
|
798
|
|
|
666
|
|
|
718
|
|
|
624
|
|
||||
Interest expense
|
(2,690
|
)
|
|
(3,422
|
)
|
|
(3,310
|
)
|
|
(6,645
|
)
|
||||
Equity income (loss), net
|
2,746
|
|
|
(14,540
|
)
|
|
39,246
|
|
|
(7,791
|
)
|
||||
Net income (loss) before income taxes
|
(6,170
|
)
|
|
(24,896
|
)
|
|
32,060
|
|
|
(16,623
|
)
|
||||
Income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(6,170
|
)
|
|
$
|
(24,896
|
)
|
|
$
|
32,060
|
|
|
$
|
(16,623
|
)
|
Net income (loss) per share (a)
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.30
|
)
|
|
$
|
(1.21
|
)
|
|
$
|
1.56
|
|
|
$
|
(0.81
|
)
|
Diluted
|
$
|
(0.30
|
)
|
|
$
|
(1.21
|
)
|
|
$
|
1.56
|
|
|
$
|
(0.81
|
)
|
(a)
|
Per share amounts for the quarters have each been calculated separately. Accordingly, quarterly amounts may not add to the annual amounts because of differences in the average common shares outstanding during each period. Additionally, in regard to diluted per share amounts only, quarterly amounts may not add to the annual amounts because of the inclusion of the effect of potentially dilutive securities only in the periods in which such effect would have been dilutive, and because of the adjustments to net income (loss) for the dilutive effect of common stock equivalents and convertible securities at our ownership interests.
|
(b)
|
The three months ended December 31, 2019 includes equity income of $1.4 million related to an equity method investment that should have been recorded during the three months ended September 30, 2019. There was no impact on the full year results.
|
Equity Compensation Plan Information
|
|||||||
Plan Category
|
Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants and Rights (1)
(a)
|
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (2)
(b)
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
(c)
|
||||
Equity compensation plans approved by security holders (3)
|
455,975
|
|
|
$16.12
|
|
2,601,650
|
|
Equity compensation plans not approved by security holders (4)
|
46,468
|
|
|
$15.10
|
|
—
|
|
Total
|
502,443
|
|
|
$15.27
|
|
2,601,650
|
|
(1)
|
Includes a total of 299,395 shares underlying PSUs and DSUs awarded for no consideration and 23,643 shares underlying DSUs awarded to directors in lieu of all or a portion of directors’ fees.
|
(2)
|
The weighted average exercise price calculation excludes 323,038 shares underlying outstanding DSUs and PSUs included in column (a) which are payable in stock, on a one-for-one basis.
|
(3)
|
Represents awards granted under the 1999 Equity Compensation Plan and the 2014 Plan and shares available for issuance under the 2014 Plan.
|
(4)
|
Represents awards granted under the 2001 Plan.
|
|
|
|
|
|
|
|
|
|
Incorporated Filing Reference
|
||
Exhibit
Number
|
|
Description
|
Form Type & Filing
Date
|
|
Original
Exhibit Number
|
1.a
|
|
Description
|
|
|
|
3.1.1
|
|
Form 8-K
10/25/07
|
|
3.1
|
|
3.1.2
|
|
Form 8-K
8/27/09
|
|
3.1
|
|
3.1.3
|
|
Form 10-Q
4/25/14
|
|
3.1
|
|
3.1.4
|
|
Form 8-K
2/20/18
|
|
3.1
|
|
3.2
|
|
Form 8-K
2/13/18
|
|
3.1
|
|
4.1
|
|
Form 8-K
2/20/18
|
|
4.1
|
|
10.1*
|
|
Form 10-Q
11/6/08
|
|
10.4
|
|
10.2
|
|
Form 10-Q
11/6/08
|
|
10.5
|
|
10.3*
|
|
Form 10-Q
7/25/14
|
|
10.1
|
|
10.4*
|
|
Form 10-K
3/19/09
|
|
10.4
|
|
10.5*
|
|
Form 8-K
4/25/08
|
|
10.1
|
|
10.6*
|
|
Form 8-K
2/19/19
|
|
99.1
|
|
10.7†
|
|
—
|
|
—
|
|
10.9.1*
|
|
Form 10-K
3/19/09
|
|
10.12
|
|
10.9.2*
|
|
Form 10-K
3/16/10
|
|
10.11.2
|
|
10.9.3*
|
|
Form 10-K
3/11/13
|
|
10.10.3
|
|
10.9.4*
|
|
Form 8-K
4/10/18
|
|
99.5
|
10.12*
|
|
Form 8-K
9/18/18
|
|
99.1
|
|
10.13*
|
|
Form 10-Q
7/26/13
|
|
10.2
|
|
10.14
|
|
Form 10-K
3/13/06
|
|
10.36
|
|
10.15
|
|
Form 8-K
5/18/11
|
|
10.1
|
|
10.16
|
|
Form 10-Q
4/24/15
|
|
10.1
|
|
10.17
|
|
Form 8-K
3/20/19
|
|
10.1
|
|
10.18
|
|
Form 8-K
4/24/18
|
|
10.1
|
|
10.19
|
|
Form 8-K
3/27/19
|
|
10.1
|
|
10.20.1
|
|
Form 8-K
7/9/18
|
|
10.1
|
|
10.20.2
|
|
Form 8-K
1/4/19
|
|
10.1
|
|
14.1 †
|
|
—
|
|
—
|
|
21.1 †
|
|
—
|
|
—
|
|
23.1 †
|
|
—
|
|
—
|
|
31.1 †
|
|
—
|
|
—
|
|
31.2 †
|
|
—
|
|
—
|
|
32.1 ‡
|
|
—
|
|
—
|
|
32.2 ‡
|
|
—
|
|
—
|
|
101
|
|
The following materials from Safeguard Scientifics, Inc. Annual Report on Form 10-K for the year ended December 31, 2019, formatted in XBRL (eXtensible Business Reporting Language); (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive Income (Loss); (iv) Consolidated Statements of Changes in Shareholders' Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to Consolidated Financial Statements.
|
—
|
|
—
|
†
|
Filed herewith
|
‡
|
Furnished herewith
|
*
|
These exhibits relate to management contracts or compensatory plans, contracts or arrangements in which directors and/or executive officers of the Registrant may participate.
|
|
|
SAFEGUARD SCIENTIFICS, INC.
|
||
|
|
|||
|
|
By:
|
|
BRIAN J. SISKO
|
|
|
|
|
Brian J. Sisko
|
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
||
BRIAN J. SISKO
|
President and Chief Executive Officer
(Principal Executive Officer) |
|
February 28, 2020
|
|
Brian J. Sisko
|
|
|||
MARK A. HERNDON
|
Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer) |
|
February 28, 2020
|
|
Mark A. Herndon
|
|
|||
IRA M. LUBERT
|
|
Director
|
|
February 28, 2020
|
Ira M. Lubert
|
|
|
||
RUSSELL D. GLASS
|
|
Director
|
|
February 28, 2020
|
Russell D. Glass
|
|
|
|
|
JOSEPH M. MANKO, JR.
|
|
Director
|
|
February 28, 2020
|
Joseph M. Manko, Jr.
|
|
|
|
|
MAUREEN F. MORRISON
|
|
Director
|
|
February 28, 2020
|
Maureen F. Morrison
|
|
|
||
JOHN J. ROBERTS
|
|
Director
|
|
February 28, 2020
|
John J. Roberts
|
|
|
||
ROBERT J. ROSENTHAL
|
|
Chairman of the Board of Directors
|
|
February 28, 2020
|
Robert J. Rosenthal
|
|
|
|
|||
|
|
|
|
Annual Board Retainers (for a full year of Board service):
|
|
|
|
|
Chairman of the Board
|
|
$100,000
|
|
Other Directors
|
|
$50,000
|
|
|
|
|
Additional Annual Chairperson Retainers (for a full year of committee service):
|
|
|
|
|
Audit Committee
|
|
$15,000
|
|
Compensation Committee
|
|
$10,000
|
|
Nominating & Corporate Governance Committee
|
|
$10,000
|
I.
|
Background - Administration
|
•
|
encourage among Company Personnel a culture of honesty, accountability and mutual respect;
|
•
|
provide guidance to help Company Personnel recognize and deal with ethical issues; and
|
•
|
provide mechanisms for Company Personnel to report unethical conduct.
|
II.
|
Overview
|
III.
|
Compliance With Law
|
•
|
stealing, embezzling or misapplying corporate or bank funds;
|
•
|
using threats, physical force or other unauthorized means to collect money;
|
•
|
making false entries in the books and records of the Company, or engaging in any conduct that results in the making of such false entries;
|
•
|
making a payment for an express purpose on the Company’s behalf to an individual who intends to use it for a different purpose;
|
•
|
utilizing the Company’s funds or other assets or services to make a political contribution or expenditure; and
|
•
|
making payments, whether corporate or personal, of cash or other items of value that are intended to influence the judgment or actions of political candidates, government officials or businesses in connection with any of the Company’s activities.
|
IV.
|
Conflicts of Interest
|
V.
|
Fair Dealing
|
VI.
|
Proper Use of Company Assets
|
VII.
|
Delegation of Authority
|
VIII.
|
Handling Confidential Information
|
•
|
the Company’s strategy, business, finances, prospects, plans, and operations;
|
•
|
proposed mergers, acquisitions, divestitures, new business ventures, opportunities, partnerships or agreements;
|
•
|
news of a pending initial or secondary public offering of securities, other public or private sales of securities, stock splits or tender offers;
|
•
|
products, orders, contracts, customers, vendors or competitors;
|
•
|
employee records;
|
•
|
the proceedings, discussions and deliberations of the Board and its committees;
|
•
|
discussions relating to the Company by and among employees, officers and directors; and
|
•
|
third party confidential and proprietary information that has been provided to the Company and which the Company is under an obligation to maintain as confidential.
|
•
|
Do not discuss Confidential Information in public places.
|
•
|
Do not forward Confidential Information or proprietary information to non-Company email accounts.
|
•
|
Beware of informal telephone or email requests from outsiders requesting information (including but not limited to requests for comments on expected financial performance, information about current or former employees, or requests from the media).
|
IX.
|
Public Disclosures
|
•
|
Act with honesty and integrity, avoiding actual or apparent conflicts of interest in personal and professional relationships.
|
•
|
Provide to the Company’s other employees, consultants and advisors who are engaged in filing reports and documents with the SEC (“SEC Reports”) or in disseminating other public communications such as press releases, information that is accurate, complete, relevant, timely and understandable.
|
•
|
Endeavor to ensure full, fair, timely, accurate and understandable disclosure in SEC Reports.
|
•
|
Comply with laws, rules and regulations of federal, state and local governments, and appropriate self-regulatory organizations.
|
•
|
Act in good faith, responsibly, with due care, competence and diligence, without misrepresenting material facts or allowing one’s independent judgment to be subordinated.
|
•
|
Respect the confidentiality of information acquired in the course of one’s work except when authorized or otherwise legally obligated to disclose.
|
•
|
Refrain from using Confidential Information acquired in the course of employment for personal advantage.
|
•
|
Proactively promote and be an example of ethical behavior as a responsible partner among peers in the work environment.
|
•
|
Endeavor to ensure responsible use of and control over all assets and resources employed or entrusted.
|
•
|
Record or participate in the recording of entries in the Company’s books and records that are accurate to the best of his or her knowledge.
|
X.
|
Report of Violations
|
•
|
Notification of Complaint
|
•
|
To report a violation, suspected violation, complaint or concern to the Compliance Officer, provide the report to the following address or e-mail address:
|
•
|
To report a violation, suspected violation, complaint or concern to the Audit Committee of the Safeguard Board, provide the report to the following address:
|
•
|
If Company Personnel are not comfortable using the procedures and protocols outlined above, they can report a violation, suspected violation, complaint or concern by providing a report via our external, anonymous and confidential reporting system, MySafeWorkplace. Such report should be provided using the following internet address or telephone number:
|
•
|
Whenever practical, the complaint should be made in writing.
|
•
|
You may choose to submit violations, suspected violations, complaints or concerns anonymously. However, we encourage Company Personnel to supply contact information with their submission to facilitate follow-up, clarification and assistance with any investigation, if necessary. Confidentiality is respected and an individual’s identity will only be shared on a “need-to-know” basis.
|
•
|
Nothing in this Code prevents Company Personnel from reporting violations or suspected violations of law to relevant government authorities.
|
•
|
Investigation and Corrective Action
|
•
|
Confidentiality
|
XI.
|
Protection Against Retaliation
|
XII.
|
Waivers
|
XIII.
|
Compliance
|
XIV.
|
Related Policies; Enforceable by Company Only
|
1.
|
I have received a copy of the Code.
|
2.
|
I have read, understand and agree to comply with the Code.
|
3.
|
I am currently in compliance and, as applicable, members of my family are in compliance, with the terms of the Code and all obligations imposed by it, except as disclosed to the Compliance Officer or as otherwise disclosed in accordance with the procedures contained in Article X of the Code.
|
4.
|
I am not aware of any conduct on the part of any person associated with the Company that may constitute a violation of the Code, except with respect to any matters that I may have disclosed to the Compliance Officer or otherwise disclosed in accordance with the procedures contained in Article X of the Code.
|
5.
|
I understand that none of the benefits, policies, programs, procedures or statements in the Code are intended to confer any rights or privileges upon me or entitle me to be or remain an employee of the Company. I am aware that the Code is not a contract and is subject to change at any time, without notice, at the sole discretion of the Company.
|
1.
|
I have complied and, as applicable, members of my family have complied, with the terms of the Code and all obligations imposed by it, except as disclosed to the Compliance Officer or as otherwise disclosed in accordance with the procedures contained in Article X of the Code.
|
2.
|
I have reviewed the Code with my subordinates and I am not aware of any conduct on the part of any person associated with the Company that may constitute a violation of the Code, except with respect to any matters that I may have disclosed to the Compliance Officer or otherwise disclosed in accordance with the procedures contained in Article X of the Code.
|
3.
|
I understand that none of the benefits, policies, programs, procedures or statements in the Code are intended to confer any rights or privileges upon me or entitle me to be or remain an employee of the Company. I am aware that the Code is not a contract and is subject to change at any time, without notice, at the sole discretion of the Company.
|
NAME
|
PLACE OF INCORPORATION
|
Bonfield VII, Ltd.
|
British Virgin Islands
|
Novitas Capital II Management, L.P.
|
Pennsylvania
|
Safeguard Capital Management, Inc.
|
Delaware
|
Safeguard Delaware, Inc.
|
Delaware
|
Safeguard Delaware II, Inc.
|
Delaware
|
Safeguard Fund Management, Inc.
|
Delaware
|
Safeguard PM SPV, Inc.
|
Delaware
|
Safeguard Scientifics (Delaware), Inc.
|
Delaware
|
Safeguard Technologies, Inc.
|
Delaware
|
SFE Properties, Inc.
|
Delaware
|
SSI Management Company, Inc.
|
Delaware
|
SSI Partnership Holdings (Pennsylvania), Inc.
|
Pennsylvania
|
1.
|
I have reviewed this Annual Report on Form 10-K of Safeguard Scientifics, Inc.;
|
|
|
|
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
|
|
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
|
|
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
|
|
|
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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SAFEGUARD SCIENTIFICS, INC.
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Date:
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February 28, 2020
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/s/ Brian J. Sisko
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Brian J. Sisko
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President and Chief Executive Officer
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(Principal Executive Officer)
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1.
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I have reviewed this Annual Report on Form 10-K of Safeguard Scientifics, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
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|
|
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b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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|
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d.
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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|
|
|
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
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|
|
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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SAFEGUARD SCIENTIFICS, INC.
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Date
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February 28, 2020
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/s/ Mark A. Herndon
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Mark A. Herndon
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Senior Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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1.
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The Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934, (15 U.S.C. 78m(a)); and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Safeguard.
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SAFEGUARD SCIENTIFICS, INC.
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Date:
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February 28, 2020
|
/s/ Brian J. Sisko
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|
|
Brian J. Sisko
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
The Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934, (15 U.S.C. 78m(a)); and
|
|
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2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Safeguard.
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SAFEGUARD SCIENTIFICS, INC.
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Date:
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February 28, 2020
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/s/ Mark A. Herndon
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Mark A. Herndon
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Senior Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer)
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