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Safeguard Scientifics announced that it has entered into an agreement with Sierra Capital Investments, L.P. and its affiliates, which currently own approximately 5.1% of the company's outstanding common stock. Under the terms of the agreement, the Safeguard Board of Directors has appointed two new independent directors, Russell D. Glass and Ira M. Lubert, to the Safeguard Board, effective immediately, and will support their re-election at the 2018 Annual Meeting of Shareholders as part of a five-person slate of nominees recommended by the Safeguard Board. Under the terms of the cooperation agreement, Sierra will vote its shares in favor of all of Safeguard's director nominees, including the new independent directors, at the Company's 2018 Annual Meeting of Shareholders. Sierra will also abide by certain customary standstill provisions until the date that is the earlier of 10 calendar days prior to the expiration of the advance notice period for the submission of shareholder nominations to be considered at Safeguard's 2019 Annual Meeting of Shareholders pursuant to Safeguard's Bylaws and 100 days prior to the first anniversary of Safeguard's 2018 Annual Meeting of Shareholders.

With the organizational changes announced, along with the aggressive cost reduction initiatives previously announced and implemented, Safeguard currently projects that its ongoing annualized operating expenses excluding interest, depreciation, severance and stock-based compensation, will approximate $8M-9M, in comparison to approximately $15M for 2017.

Safeguard's current Senior Vice President and CFO, Jeffrey McGroarty, will depart from the Company, effective June 30, 2018; and Senior Vice President of Investor Relations and Corporate Communications, John Shave, will depart thereafter at a specific date yet to be determined. David Kille, Safeguard's Corporate Controller, will assume the role of Safeguard's CFO, effective June 1, 2018. Dr. Gary Kurtzman, Senior Vice President and Managing Director, Healthcare remains in his role and will work closely with Sisko in providing oversight of the Partner Companies. Following these organizational changes, Safeguard does not intend to fill the roles of COO, Senior Vice President of Investor Relations and Corporate Communications or Corporate Controller, and these roles will either be eliminated or will be combined with other roles.

Safeguard Scientifics announced a series of management changes intended to streamline the Company's organizational structure and reduce operating costs. These aggressive cost-reduction initiatives are intended to better align Safeguard's cost structure with the strategy the Company announced in January 2018 to reduce its operating costs, monetize its Partner Company interests and maximize the net proceeds distributable to Safeguard's shareholders. Stephen Zarrilli, who has served as Safeguard's President and CEO since November 2012, will retire from Safeguard, effective September 30, 2018. Safeguard's Board of Directors has appointed Brian Sisko to succeed Zarrilli as President and CEO, effective July 1, 2018. Sisko joined Safeguard as Senior Vice President and General Counsel in August 2007, and currently serves as Executive Vice President, COO and Managing Director of Safeguard. Zarrilli will remain with the Company as a non-executive employee until September 30, 2018 to ensure a smooth transition. He will continue to serve on the Safeguard Board until the 2018 Annual Meeting, but will not stand for re-election.