SFE First Quarter 2012 Results Forward Looking Statements - PDF document

SFE First Quarter 2012 Results

Forward Looking Statements Statements contained in this presentation that are not historical facts are forward looking statements which involve certain risks and uncertainties including, but not limited to, risks associated with the uncertainty of managing rapidly changing technologies, limited access to capital, competition, the ability to attract and retain qualified employees, our ability to execute our strategy, the uncertainty of the future performance of our partner companies, acquisitions and dispositions of additional partner companies, the inability to manage growth, government regulation and legal liabilities and the effect of economic conditions in the business sectors in which our partner companies operate, negative media coverage and other uncertainties as described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K. Safeguard does not assume any obligation to update any forward looking statements or other information contained in this presentation. 2

Q1’12 Highlights • Capital Deployment – $12.2M in Two New Partner Companies – $4.4M in Two Follow-on Transactions – $2.5M in Penn Mezzanine Loan Participations • Four Partner Companies Have Achieved Sustained EBITDA Positive Status 3

Safeguard Strategy • Exploit Five Strategic Themes – Maturity, Migration, Convergence, Compliance and Cost Containment • Typically Deploy up to $25M in Growth Capital per Partner Company • 16 Partner Companies Today • Exits Timed to Maximize Risk-Adjusted Returns on Capital – Targeted Aggregate 2x to 5x, at a Minimum, Given Evolving Diversified Deployment Strategy – Realized Gross, Aggregate Cash-on-Cash Return of 2.0x on Non-Legacy Capital Deployments Since 2006 4

Highlights • $64.2M Total Funding • 7 Investments as of 3/31/12 • $26.4M Invested; SFE is GP and Co-Investor • All Maturities ≤ 5 Years from Funding • Yielding 12.8% • Does Not Include Any Equity Appreciation 5

Partner Company Holdings As of March 31, 2012 Acquisition Ownership Carrying Year % Value Cost Life Sciences Partner Companies: Alverix 2007 50% $ 0.5 $ 8.4 Good Start Genetics 2010 29% 7.2 10.5 Medivo 2011 30% 6.0 6.3 NovaSom 2011 30% 16.7 20.0 NuPathe (Nasdaq: PATH) 2006 18% 9.9 18.3 PixelOptics 2011 25% 17.6 25.1 Putney 2011 28% 9.4 10.0 TOTAL: $ 67.3 $ 98.6 Technology: AdvantEdge Healthcare Solutions 2006 40% $ 7.6 $ 15.3 Beyond.com 2007 38% 10.7 13.5 Bridgevine 2007 23% 6.4 10.0 DriveFactor 2011 24% 1.7 1.7 Hoopla Software 2011 25% 1.3 1.3 Lumesis 2012 32% 2.2 2.2 MediaMath 2009 22% 13.1 16.9 Spongecell 2012 23% 10.0 10.0 ThingWorx 2011 30% 3.6 5.0 TOTAL: $ 56.6 $ 75.9 $ 123.9 $ 174.5 Total: Life Sciences + Technology Figures above do not include amounts deployed relating to Penn Mezzanine since inception or amounts previously deployed in private equity funds. 6

Financial Highlights • Net Cash, Cash Equivalents and Marketable Securities – $188.5M at 3/31/12 vs. $211.9M at 12/31/11 • Q1’12 Primary Uses of Cash = $25.9M • 2012 Projected Uses of Cash = $100M to $150M – Capital Deployment into New Partner Companies – Follow-on Funding for Current Partner Companies and Penn Mezzanine Participations – Corporate Expenses – Platform Expansion 7

Safeguard Partner Companies • 16 Partner Companies Today Aggregate Revenue* • 25 Board Seats Across 16 Companies • 15 Companies Generating Revenue • 4 Companies EBITDA Positive • 1 Company Filed NDA • Deployed $174.5M in Current Partner Companies • Realized $635M Since January 2006 • Strong Partner Company Satisfaction * Aggregate revenue guidance for 2012 and prior years, presented above, reflects revenue on a net basis. Revenue figures utilized for certain companies pertain to periods prior to Safeguard’s involvement with said companies and based solely on information provided to Safeguard by such companies. Safeguard reports the revenue of its equity method and cost method partner companies on a one-quarter lag basis. 8

Questions & Answers

Why Own Safeguard? • Value Realized by Developing Growth-Stage Businesses through Active Ownership • Healthy Portfolio of Well-Positioned Partner Companies • Major Improvements in Financial Strength, Flexibility and Liquidity • Initiatives to Increase Capital Under Management • Strong Alignment of Interests 10 10

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