<PAGE>
Prospectus Supplement No. 2 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in the prospectus is superseded in part by the information appearing in the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 Common Stock
Beneficially Owned Owned Prior To
and Offered The Offering(1) Common Stock
NAME Hereby(1) (2) Offered Hereby (2)
- ---------------------------- ---------- ----- -----
<S> <C> <C> <C>
Aragon Investments, Ltd. $ 100,000 1,382 1,382
Boulder Capital, Inc. $ 3,850,000 53,220 53,220
Citadel Trading Group L.L.C. $ 60,000 829 829
Jackson Investment Fund, Ltd. $ 940,000 12,994 12,994
McMahan Securities Company, $ 700,000 9,676 9,676
L.P.
Onex Industrial Partners $ 4,050,000 55,985 55,985
Limited
Value Line Convertible Fund, $ 250,000 3,455 3,455
Inc.
Any other holder of notes or $12,066,000 166,794 166,794
future transferee from any
such holder (3)(4)
</TABLE>
_____________
(1) Includes common stock into which the notes are convertible.
(2) Assumes a conversion price of $72.3406 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 $72.3406 per
share.
<PAGE>
On February 4, 2000, our partner company, eMerge Interactive, Inc., offered
8,000,000 shares of its common stock for purchase by the public pursuant to a
Registration Statement on Form S-1 at an initial offering price of $15.00 per
share. Holders of our common stock were eligible to purchase up to 3,500,000
shares of eMerge's common stock through and in accordance with our directed
share subscription program. Pursuant to the terms of the indenture and as a
result of the eMerge offering, the conversion price of the Notes has been
adjusted downward and, effective as of February 11, 2000, the fifth business day
following the completion of the eMerge offering, the conversion price is
$72.3406.
Accordingly, the following references in the prospectus to the conversion
price of $75.0441 per share are superseded and replaced by the conversion price
of $72.3406 per share and the prospectus is hereby superseded in part as
follows:
Reference to "$75.0441" on the front cover, line 18 is replaced with "72.3406";
Reference to "November 30, 1999" on the front cover, line 19 is replaced with
"February 11, 2000";
Reference to "75.0441" on page 16, line 19 is replaced with "72.3406"; and
Reference to "November 30, 1999" on page 16, line 19 is replaced with
"February 11, 2000".
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 MARCH 8, 2000
