<PAGE>
Prospectus Supplement No. 1 Filed Pursuant to Rule 424(b)(3)
to Prospectus Dated December 6, 1999 File No. 333-86675
$200,000,000
SAFEGUARD SCIENTIFICS, INC.
5.0% CONVERTIBLE SUBORDINATED NOTES DUE JUNE 15, 2006
This prospectus supplement relates to the resale by the holders (the
"Selling Holders") of 5.0% Convertible Subordinated Notes due June 15, 2006 (the
"Notes") of Safeguard Scientifics, Inc. (the "Company") and the shares of common
stock, $.10 par value (the "Common Stock"), of the Company issuable upon the
conversion of the Notes.
This prospectus supplement should be read in conjunction with the
prospectus dated December 6, 1999, which is to be delivered with this prospectus
supplement. All capitalized terms used but not defined in this prospectus
supplement shall have the meanings given them in the prospectus.
The information in the table appearing under the heading "Selling Holders"
in the prospectus is superseded in part by the information appearing in the
table below:
<TABLE>
<CAPTION>
Principal Amount of
Notes Beneficial Common Stock
Owned and Offered Owned Prior To The Common Stock Offered
Name Hereby(1) Offering(1) (2) Hereby (2)
- ----------------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
1976 Distribution Trust-FBO A.R.
Lauder/Zinterhofer $ 6,000 79 79
1976 Distribution Trust-FBO Jane A. Lauder $ 6,000 79 79
Aftra Health Fund $ 300,000 3,997 3,997
AIG/National Union Fire Insurance $ 955,000 12,725 12,725
Alexandra Global Investment
Fund 1 Ltd. $ 1,000,000 13,325 13,325
Aloha Airlines Non-Pilots Pension
Trust $ 105,000 1,399 1,399
Aloha Airlines Pilots Retirement
Trust $ 60,000 799 799
Arkansas PERS $ 1,635,000 21,787 21,787
Banc of America Securities LLC $ 150,000 1,998 1,998
British Virgin Islands Social Security
Board $ 11,000 146 146
Brown & Williamson Tobacco
Master Retirement Trust $ 75,000 999 999
C&H Sugar Company, Inc. $ 155,000 2,065 2,065
City University of New York $ 28,000 373 373
Conseco Direct Life $ 925,000 12,326 12,326
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Amount of
Notes Beneficial Common Stock
Owned and Offered Owned Prior To The Common Stock Offered
Name Hereby(1) Offering(1) (2) Hereby (2)
- ----------------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
Credit Suisse First
Boston Corporation $59,656,000 794,945 794,945
Delaware PERS $ 1,425,000 18,988 18,988
Deutsche Bank Securities, Inc. $25,760,000 343,264 343,264
Fidelity Financial Trust:
Fidelity Convertible Securities Fund $ 2,400,000 31,981 31,981
Forum Capital Markets L.L.C. $ 1,665,000 22,186 22,186
Goldman Sachs & Company $ 2,245,000 29,915 29,915
The Grable Foundation $ 40,000 533 533
The Grady Hospital Foundation $ 40,000 533 533
Hawaiian Airlines Employees
Pension Plan - IAM $ 90,000 1,199 1,199
Hawaiian Airlines Pension Plan for
Salaried Employees $ 25,000 333 333
Hawaiian Airlines Pilots Retirement
Plan $ 140,000 1,865 1,865
ICI American Holdings Trust $ 605,000 8,061 8,061
Island Holdings $ 10,000 133 133
Mainstay Strategic Value Fund $ 125,000 1,665 1,665
Mainstay VP Convertible Portfolio $ 250,000 3,331 3,331
Merrill Lynch Insurance Group $ 98,000 1,305 1,305
Nalco Chemical Company $ 315,000 4,197 4,197
New Orleans Firefighters
Pension/Relief Fund $ 44,000 586 586
New York Life Separate Account #7 $ 250,000 3,331 3,331
Occidental Petroleum Corporation $ 75,000 999 999
Onyx Fund Holdings, LDC $ 1,000,000 13,325 13,325
Palladin Securities LLC $ 925,000 12,326 12,326
PGEP III LLC $ 650,000 8,661 8,661
PRIM Board $ 2,700,000 35,978 35,978
Queens Health Plan $ 35,000 466 466
San Diego County Employees
Retirement Association $ 1,000,000 13,325 13,325
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Amount of
Notes Beneficial Common Stock
Owned and Offered Owned Prior To The Common Stock Offered
Name Hereby(1) Offering(1) (2) Hereby (2)
- ----------------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
Shell Pension Trust $ 59,000 786 786
Southern Farm Bureau Life
Insurance-FRIC $ 700,000 9,327 9,327
Starvest Combined Portfolio $ 1,355,000 18,056 18,056
Starvest Managed Portfolio $ 105,000 1,399 1,399
State of Maryland Retirement
Agency $ 603,000 8,035 8,035
State of Oregon/SAIF Corporation $ 4,700,000 62,629 62,629
State of Oregon Equity $ 7,020,000 93,544 93,544
Warburg Dillon Read LLC $ 829,000 11,046 11,046
Zeneca Holdings Trust $ 605,000 8,061 8,061
Any other holder of notes or future
transferee from any such holder
(3)(4) $18,116,000 241,404 241,404
</TABLE>
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(1) Includes common stock into which the notes are convertible.
(2) Assumes a conversion price of $75.0441 per share and a cash payment in lieu
of any fractional interest.
(3) Information concerning other selling holders of notes will be set forth in
prospectus supplements from time to time, if required.
(4) Assumes that any other holder of notes or any future transferee from any
such holder does not beneficially own any common stock other than common
stock into which the notes are convertible at the conversion price of
$75.0441 per share.
INVESTING IN THE NOTES OR THE COMMON STOCK INTO WHICH THE NOTES ARE
CONVERTIBLE INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING ON
PAGE 5 OF THE PROSPECTUS.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THE PROSPECTUS OR THIS PROSPECTUS SUPPLEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS JANUARY 14, 2000
