EXHIBIT 10.8

(SAFEGUARD LOGO) [w68353w6835302.gif]

September 10, 2003

Anthony Ibarguen
Safeguard Scientifics, Inc.
435 Devon Park Drive
Wayne, PA 19087

Dear Mr. Ibarguen:

     You previously entered into an employment letter agreement with Safeguard
Scientifics, Inc. (“Safeguard”) on January 2, 2002 (the “Prior Agreement”).
Safeguard considers it essential to the best interests of its stockholders to
foster your continued employment with Safeguard and to offer you protection in
the event of your severance, including following a change of control.
Accordingly, the Board of Directors of Safeguard (the “Board”) believes it is
now appropriate to modify your Prior Agreement in certain respects and to
reaffirm its obligation to you in this letter (the “New Agreement”).
Accordingly, this New Agreement serves to amend and restate in its entirety
Section 6 of the Prior Agreement. Consequently the Prior Agreement shall remain
in full force and effect except that the provisions of Section 6 thereof shall
be replaced in their entirety and shall be superseded by the New Agreement.

     Subject to the terms and conditions set forth below, in the event that (A)
your employment with Safeguard is terminated by Safeguard without cause or by
you for good reason within eighteen (18) months following a change of control of
Safeguard (“Change of Control Termination”) or (B) you are terminated for any
reason other than for cause or resignation without good reason (such a
termination, a “Severance Termination”), Safeguard shall provide you with the
following benefits, which together with any benefits provided under the
applicable terms of any other plan or program sponsored by the Safeguard, and
applicable to you, shall be the only severance benefits or other payments in
respect of your employment with Safeguard to which you shall be entitled. The
benefits you receive under this New Agreement will be in respect of all salary,
accrued vacation and other rights that you may have against Safeguard or its
affiliates.

• You will receive a payment in respect of your current year’s bonus equal to
the average bonus percentage of annual base salary paid to other members of
Safeguard’s Managing Directors Committee as determined at the end of

 

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Safeguard’s fiscal year multiplied by a fraction, the numerator of which is the
number of days in Safeguard’s fiscal year elapsed at the time of the termination
and the denominator of which is 365. Payment under this provision will be made
within a reasonable period of time after the end of Safeguard’s fiscal year for
which the payment is being made.

• If (A) there is a Change of Control Termination or (B) a Severance Termination
occurs after the later of (1) the third anniversary of your date of employment
or (2) October 12, 2003 (collectively the “Service Requirements”), you will
receive a lump sum payment equal to the product of (i) 2 multiplied by (ii) the
sum of your annual base salary (of at least $310,000) plus the average of your
actual bonus as received for the last three completed fiscal years during which
you were a Managing Director (taking into account the value of any equity grants
received by you during such period in lieu of cash bonuses). If there has been
no Change of Control termination but there has been a Severance Termination
before the Service Requirements are met, you will receive a lump sum payment
equal to the product of (i) 1.5 multiplied by (ii) the sum of your annual base
salary (of at least $310,000) plus the average of your actual bonus as received
for the last three completed fiscal years during which you held your current
position on the date of this letter (taking into account the value of any equity
grants received by you during such period in lieu of cash bonuses)

• Except as provided below, you will only vest in your interests under and you
will receive benefits in accordance with the terms and conditions set forth in
Safeguard’s various long term incentive plans.

• You will receive up to twenty four (24) months continued coverage under
Safeguard’s medical and health plans and life insurance plans, which coverage
shall run concurrent with the coverage provided under section 4980B of the Code;
or as an alternative, at the discretion of the Board, the Board may elect to pay
you in lieu of such coverage an amount equal to your cost of continuing such
coverage. You should consult with Safeguard’s Manager of Human Resources
concerning the process for assuming ownership of and continued premium payments
for any whole life policy at end of such twenty four (24) month period.

• You will receive up to $20,000 as a reimbursement for documented outplacement
services or office space which you secure.

• You will be reimbursed promptly for all your reasonable and necessary business
expenses incurred on behalf of Safeguard prior to your termination date in
accordance with Safeguard’s customary policies.

• If you experience a Change of Control Termination as described above, you will
become fully vested in all of your outstanding stock options and you may
exercise those stock options during the thirty six (36) month period following

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your termination of employment (unless any of the options would by their terms
expire sooner, in which case you may exercise such options at any time before
their expiration) and you will become fully vested in all of your outstanding
restricted stock awards and deferred stock units, if any.

• If your employment with Safeguard is terminated, for any reason, other than
cause or your resignation without good reason, you will become fully vested in
your outstanding stock options and you may exercise those stock options during
the 36 month period following your termination of employment (unless any of the
options would by their terms expire sooner, in which case you may exercise such
options at any time before their expiration). In addition, upon such a
termination, your restricted stock grants made before October, 2002 will become
fully vested and the Board, in its discretion may accelerate the vesting of any
restricted stock grants and deferred stock units, if any, made or credited after
October, 2002.

     All compensation and benefits described in this New Agreement will be
offered in return for and contingent on your execution and non-revocation of a
release and non-competition agreement substantially in the forms attached to
this letter.

     Upon your termination of employment with Safeguard in connection with a
change of control, as discussed above, if it is determined that any payment or
distribution by Safeguard of benefits provided under this New Agreement or any
other benefits due upon a change of control (the “Change of Control Benefits”)
would constitute an “excess parachute payment” within the meaning of section
280G of the Code that would be subject to an excise tax under section 4999 of
the Code (the “Excise Tax”) the following provisions shall apply, unless
provided otherwise in the applicable plan, program or agreement that provides
change of control payments that are not paid pursuant to this New Agreement. If
the aggregate present value to you of receiving the Change of Control Benefits
and paying the Excise Tax is not greater than the aggregate present value to you
of the Change of Control Benefits reduced to the safe harbor amount (as defined
below), then Safeguard shall reduce the Change of Control Benefits such that the
aggregate present value to you of receiving the Change of Control Benefits is
equal to the safe harbor amount. Otherwise you shall receive the full amount of
the Change of Control Benefits and you shall be responsible for payment of the
Excise Tax. For purposes of this paragraph “present value” shall be determined
in accordance with Section 280G(d)(4) of the Code and the term “safe harbor
amount” shall mean an amount expressed in the present value that maximizes the
aggregate present value of the Change of Control Benefits without causing any of
the Change of Control Benefits to be subject to the deduction limitations set
forth in Section 280G of the Code.

     All determinations made pursuant to the foregoing paragraph shall be made
by Safeguard’s independent public accountant immediately prior to the change of
control (the “Accounting Firm”), which firm shall provide its determinations and
any supporting calculations both to Safeguard and to you within ten days of the
termination date. Any

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such determination by the Accounting Firm shall be binding upon you and
Safeguard. You shall then, in your sole discretion, determine which and how much
of the Change of Control Benefits shall be eliminated or reduced consistent with
the requirements of the foregoing paragraph. All of the fees and expenses of the
Accounting Firm in performing the determinations referred to above shall be
borne solely by Safeguard.

     Safeguard will pay you the lump sum payments described above within five
business days of the date on which you have signed the release and
non-competition agreement and such agreements have become effective and
following any determination required by the preceding paragraph. Safeguard will
prepare the final release (which will be substantially in the form attached as
Exhibit A to this letter, but with such changes, if any, as recommended by
Safeguard’s counsel) and the final non-competition agreement (which will be
substantially in the form attached as Exhibit B to this letter, but with such
changes, if any, as recommended by Safeguard’s counsel) within five business
days of your termination of employment. You will have 21 days in which to
consider the release although you may execute it sooner. Please note that the
release has a rescission period of seven days after which it becomes effective
if not revoked. All other payments will be made to you within five business days
of the date on which they become due or, in the case of payments payable on
notice from you, within five business days of such notice.

     Safeguard will pay interest on late payments at the prime rate at
Safeguard’s agent bank plus 2 percent compounded monthly. In addition, Safeguard
will pay all reasonable costs and expenses (including reasonable attorney’s fees
and all costs of arbitration) incurred by you to enforce the agreement set forth
in this New Agreement or any obligation hereunder.

     In this letter, the term “cause” means (a) your failure to adhere to any
written Safeguard policy if you have been given a reasonable opportunity to
comply with such policy or cure your failure to comply (which reasonable
opportunity must be granted during the ten-day period preceding termination of
this New Agreement); (b) your appropriation (or attempted appropriation) of a
material business opportunity of Safeguard, including attempting to secure or
securing any personal profit in connection with any transaction entered into on
behalf of Safeguard; (c) your misappropriation (or attempted misappropriation)
of any Safeguard fund or property; or (d) your conviction of, or your entering a
guilty plea or plea of no contest with respect to, a felony, the equivalent
thereof, or any other crime with respect to which imprisonment is a possible
punishment.

     In this letter, the term “good reason” means (i) your assignment (without
your consent) to a position, title, responsibilities, or duties of a materially
lesser status or degree of responsibility than your current position,
responsibilities, or duties; provided, however, that a mere change in your area
of responsibilities shall not constitute a material change if you are reasonably
suited by your education and training for such responsibilities and you remain a
member of the Safeguard Managing Directors Committee; (ii) a reduction of your
base salary or target bonus opportunity (acknowledging that the payment of any
bonus is subject to the discretion of the

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Compensation Committee of the Board); (iii) the relocation of Safeguard’s
principal executive offices to a location which is more than 30 miles away from
the location of Safeguard’s principal executive offices on the date of this New
Agreement; or (iv) your assignment (without your consent) to be based anywhere
other than Safeguard’s principal executive offices. Notwithstanding the
foregoing, good reason shall not exist if Safeguard cures such action or failure
to act that constitutes good reason within a reasonable period of time (which
reasonable period of time shall not be longer than 10 days) following the date
you provide Safeguard with notice of your intended resignation for good reason.

     A “change of control” shall be deemed to have occurred if (i) any “person”
or “group” (as such terms are used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than
any Safeguard employee stock ownership plan or an equivalent retirement plan,
becomes the beneficial owner (as such term is used in Section 13(d) of the
Exchange Act), directly or indirectly, of securities of Safeguard representing
50% or more of the combined voting power of Safeguard’s then outstanding voting
securities, (ii) the Board ceases to consist of a majority of Continuing
Directors (as defined below), (iii) the consummation of a sale of all or
substantially all of Safeguard’s assets or a liquidation (as measured by the
fair value of the assets being sold compared to the fair value of all of
Safeguard’s assets), or (iv) a merger or other combination occurs such that a
majority of the equity securities of the resultant entity after the transaction
are not owned by those who owned a majority of the equity securities of
Safeguard prior to the transaction. A “Continuing Director” shall mean a member
of the Board of Directors who either (i) is a member of the board of Directors
at the date of this New Agreement or (ii) is nominated or appointed to serve as
a Director by a majority of the then Continuing Directors.

     The provisions set forth in this New Agreement will inure to the benefit of
your personal representative, executors and heirs. In the event you die while
any amount payable under the New Agreement remains unpaid, all such amounts will
be paid in accordance with the terms and conditions of this letter.

     No term or condition set forth in this letter may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing
and signed by you and the Board of Safeguard or a duly authorized officer of
Safeguard.

     You will not be required to mitigate the amount of any payment provided for
in this letter by seeking other employment or otherwise.

     You acknowledge that the arrangements described in this New Agreement will
be the only obligations of Safeguard or its affiliates in connection with any
determination by Safeguard to terminate your employment with Safeguard. This New
Agreement does not terminate, alter or affect your rights under any plan or
program of Safeguard in which you may participate or under which you are due a
benefit, except as explicitly set forth herein.

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Your participation in such plans or programs will be governed by the terms of
such plans and programs.

     The provisions set forth in this New Agreement will be construed and
enforced in accordance with the law of the Commonwealth of Pennsylvania without
regard to the conflicts of laws rules of any state.

     Any controversy or claim arising out of or relating to this New Agreement,
or the breach thereof, will be settled by arbitration in Philadelphia,
Pennsylvania, in accordance with the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association, using one
arbitrator, and judgment upon the award rendered by the arbitrator may be
entered in any court of competent jurisdiction.

     The obligations of Safeguard set forth herein are absolute and
unconditional and will not be subject to any right of set-off, counterclaim,
recoupment, defense or other right which Safeguard may have against you, subject
to, in the event of your termination of employment, your execution of the
relevant release and the non-competition agreement set forth in the forms
attached to this New Agreement.

     Safeguard may withhold applicable taxes and other legally required
deductions from all payments to be made hereunder.

     Safeguard’s obligations to make payments under this letter are unfunded and
unsecured and will be paid out of the general assets of Safeguard.

     The New Agreement, together with the Prior Agreement, where applicable, as
discussed in the first paragraph of this letter, constitute the entire agreement
and understanding with respect to your severance arrangements, and supersede any
and all prior agreements and understandings whether oral or written, relating
thereto. If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to us the enclosed copy of this letter which will then
constitute our legally binding agreement on this subject.

     

  Sincerely,
 
   

  Safeguard Scientifics, Inc.

  By: ANTHONY L. CRAIG

 

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  Title:

I agree to the terms and conditions of this letter.

ANTHONY IBARGUEN

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Anthony Ibarguen

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EXHIBIT A
GENERAL RELEASE AND AGREEMENT

NOTICE:

     Various state and federal laws, including the Civil Rights Act of 1964 and
1991 and the Age Discrimination in Employment Act, prohibit employment
discrimination based on age, sex, race, color, national origin, religion,
disability and veteran status. These laws are enforced through the Equal
Employment Opportunity Commission (EEOC), the Department of Labor and state
civil rights agencies.

     If you sign this General Release and Agreement and accept the agreed-upon
special severance allowance and other termination benefits described in the
letter addressed to you which accompanies this release, you are giving up your
right to file a lawsuit pursuant to the aforementioned federal, state and local
laws in local, state or federal courts against Safeguard Scientifics, Inc. and
its affiliates (the “Releasees”) with respect to any claims relating to your
employment or termination therefrom which arise up to the date this Agreement is
executed.

     By signing this General Release and Agreement you waive your right to
recover any damages or other relief in any claim or suit brought by or though
the Equal Employment Opportunity Commission or any other state or local agency
on your behalf under and federal or state discrimination law, except where
prohibited by law. You agree to release and discharge each Releasee not only
from any and all claims which you could make on your own behalf, but also
specifically waive any right to become, and promise not to become, a member of
any class in any proceeding or case in which a claim or claims against a
Releasee may arise, in whole or in part, from any event which occurred as of the
date of this Agreement. You agree to pay for any legal fees or cost incurred by
any Releasee as a result of any breach of the promises in this paragraph. The
parties agree that if you, by no action of your own, become a mandatory member
of any class from which you cannot, by operation of law or order of court, opt
out, you shall not be required to pay for any legal fees or costs incurred by a
Releasee as a result.

     We encourage you to discuss the following release language with an attorney
prior to executing this Agreement. In any event, you should thoroughly review
and understand the effect of the agreement set forth below before acting on it.
Therefore, please take this release home and consider it for up to twenty-one
(21) days before you decide to sign it.

 

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GENERAL RELEASE AND AGREEMENT

     This GENERAL RELEASE AND AGREEMENT (hereinafter the “Agreement”) is made
and entered into as of this                    day of                    , 200_,
by and between SAFEGUARD SCIENTIFICS, INC. (“Safeguard”) and [Name of Managing
Director] (“Employee”).

1. Background. The parties hereto acknowledge that this Agreement is being
entered into pursuant to the terms of the Letter Agreement, dated              
      between Safeguard and Employee (the “Letter Agreement”). As used in this
Agreement, any reference to Safeguard shall include its predecessors and
successors and, in their capacities as such, all of its present, past, and
future directors, officers, employees, attorneys, insurers, agents and assigns,
as well as all Safeguard affiliates, subdivisions and subsidiaries; and any
reference to Employee shall include, in their capacities as such, his or her
attorneys, heirs, administrators, representatives, agents and assigns.

2. Resignation from Boards. Employee shall, and hereby does resign from such
Boards and officer positions with Safeguard and all affiliates and partner
companies of Safeguard as such employee holds on the date hereof. In this
regard, Employee agrees to pre-sign and deliver to Safeguard resignation letters
acceptable to Safeguard in order to affect Employee’s resignation from certain
companies and entities, and Safeguard may submit other such letters from time to
time, although nothing contained herein shall prohibit Employee from resigning
from such boards and officer positions at an earlier time.

3. General Release.

     (a) Employee, for and in consideration of the special severance allowance
and other termination benefits offered to him by Safeguard specified in the
Letter Agreement and intending to be legally bound, does hereby REMISE, RELEASE
AND FOREVER DISCHARGE Safeguard, of and from any and all causes of actions,
suits, debts, claims and demands whatsoever in law or in equity, which Employee
ever had, now has, or hereafter may have or which Employee’s heirs, executors or
administrators may have, by reason of any matter, cause or thing whatsoever,
from the beginning of Employee’s employment with Safeguard to the date of this
Agreement, and particularly, but without limitation, any claims arising from or
relating in any way to Employee’s employment or the termination of Employee’s
employment relationship with Safeguard, including, but not limited to, any
claims arising under any federal, state, or local laws, including Title VII of
the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., (“Title
VII”), the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. (“the
ADEA”), the Americans with Disabilities Act, 42 U.S.C. § 12101 et seq. (“ADA”),
Employee Retirement Income Security Act of 1974, as amended 29 U.S.C. § 301, et
seq., as amended (“ERISA”), the Pennsylvania Wage Payment and Collection Law,
Pa. Stat. Ann. tit. 43 §§ 260.1-260.11a (“WPCL”), the Pennsylvania Human
Relations Act, 43 P.S. § 951 et seq. (the “PHRA”), and any and all other
federal, state or local laws, regulations, ordinances or public policies and any
common law claims now or hereafter recognized,

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including claims for wrongful discharge, slander and defamation, as well as all
claims for counsel fees and costs.

     (b) By signing this Agreement, Employee represents that Employee has not
commenced any proceeding against Safeguard in any forum (administrative or
judicial) concerning Employee’s employment or the termination thereof. Employee
further acknowledges that Employee was given sufficient notice under the Worker
Adjustment and Retraining Notification Act (the “WARN Act”) and that the
termination of Employee’s employment does not give rise to any claim or right to
notice, or pay or benefits in lieu of notice under the WARN Act. In the event
any WARN Act issue does exist or arises in the future, Employee agrees and
acknowledges that the payments and benefits set forth in this Agreement shall be
applied to any compensation or benefits in lieu of notice required by the WARN
Act, provided that any such offset shall not impair or affect the validity of
any provision of this Agreement or the Letter Agreement.

     (c) Employee agrees that in the event of a breach of any of the terms of
this Agreement, Safeguard shall be entitled to recover attorneys’ fees and costs
in an action to prosecute such breach, in addition to compensatory damages, and
may cease to make any payments then due under the Letter Agreement.

     (d) Anything herein to the contrary notwithstanding, neither party is
released from any obligations under the Letter Agreement and Employee
acknowledges that Safeguard’s obligations under the Letter Agreement and this
Agreement are the only obligations of Safeguard or its affiliates in connection
with the severance of Employee’s service with Safeguard. This Agreement does not
terminate, alter or affect Employee’s rights under any plan or program of
Safeguard in which Employee may participate and under which Employee is due a
benefit, except as explicitly set forth herein. Employee’s participation in such
plans or programs will be governed by the terms of such plans and programs.

     (e) Employee agrees and acknowledges that this Agreement is not and shall
not be construed to be an admission by Safeguard of any violation of any
federal, state or local statue, ordinance, regulation or of any duty owed by
Safeguard to Employee.

4. Confidentiality; Non-Disparagement.

     (a) Except to the extent required by law, including SEC disclosure
requirements, Safeguard and Employee agree that the terms of this Agreement will
be kept confidential by both parties, except that Employee may advise his family
and confidential advisors, and Safeguard may advise those people needing to know
to implement the above terms.

     (b) Employee will not at any time knowingly reveal to any person or entity
any of the trade secrets or confidential information of Safeguard or of any
third party which Safeguard is under an obligation to keep confidential
(including but not limited to trade secrets or confidential information
respecting inventions, products, designs,

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methods, know-how, techniques, systems, processes, software programs, works of
authorship, customer lists, projects, plans and proposals), and Employee shall
keep secret all confidential matters relating to Safeguard and shall not use or
attempt to use any such confidential information in any manner which injures or
causes loss or may reasonably be calculated to injure or cause loss whether
directly or indirectly to Safeguard. These restrictions contained in this
sub-paragraph (b) shall not apply to: (i) information that at the time of
disclosure is in the public domain through no fault of Employee’s; (ii)
information received from a third party outside of Safeguard that was disclosed
without a breach of any confidentiality obligation; (iii) information approved
for release by written authorization of Safeguard; or (iv) information that may
be required by law or an order of the court, agency or proceeding to be
disclosed; provided, that Employee shall provide Safeguard notice of any such
required disclosure once Employee has knowledge of it and will help Safeguard at
Safeguard’s expense to the extent reasonable to obtain an appropriate protective
order.

     (c) Employee represents that Employee has not taken, used or knowingly
permitted to be used any notes, memorandum, reports, list, records, drawings,
sketches, specifications, software programs, data, documentation or other
materials of any nature relating to any matter within the scope of the business
of Safeguard or its partner companies or concerning any of its dealings or
affairs otherwise than for the benefit of Safeguard. Employee shall not, after
the termination of Employee’s employment, use or knowingly permit to be used any
such notes, memoranda, reports, lists, records, drawings, sketches,
specifications, software programs, data, documentation or other materials, it
being agreed that all of the foregoing shall be and remain the sole and
exclusive property of Safeguard and that immediately upon the termination of
Employee’s employment, Employee shall deliver all of the foregoing, and all
copies thereof, to Safeguard, at its main office.

     (d) In accordance with normal ethical and professional standards, Safeguard
and Employee agree that they shall not in any way engage in any conduct or make
any statement that would defame or disparage the other, or make to, or solicit
for, the media or others, any comments, statements (whether written or oral),
and the like that may be considered to be derogatory or detrimental to the good
name or business reputation of either party. It is understood and agreed that
Safeguard’s obligation under this paragraph extends only to the conduct of
Safeguard’s senior officers. The only exception to the foregoing shall be in
those circumstances in which Employee or Safeguard is obligated to provide
information in response to an investigation by a duly authorized governmental
entity or in connection with legal proceedings.

5. Indemnity.

     (a) This Agreement shall not release Safeguard or any of its insurance
carriers from any obligation it or they might otherwise have to defend and/or
indemnify Employee and hold harmless any other director or officer and Safeguard
affirms its obligation to provide indemnification to Employee as a director,
officer or former director or officer of

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Safeguard, as set forth in Safeguard’s bylaws and charter documents in effect on
January 1, 2003.

     (b) Employee agrees that Employee will personally provide reasonable
assistance and cooperation to Safeguard in activities related to the prosecution
or defense of any pending or future lawsuits or claims involving Safeguard.

6. General.

     (a) Employee acknowledges and agrees that he has twenty-one (21) days to
consider this Agreement, and that Employee has been advised by Safeguard, in
writing, to consult with his attorney before signing this Agreement, and that
Employee had discussed this matter with his attorney before signing it. Employee
further acknowledges that Safeguard has advised him that he may revoke this
Agreement for a period of seven (7) calendar days after it has been executed,
with the understanding that Safeguard has no obligations under this Agreement
until the seven (7) day period has passed. If the seventh day is a weekend or
national holiday, Employee will have until the next business day to revoke. Any
revocation must be in writing and received by Safeguard at its facility located
at 800 The Safeguard Building, 435 Devon Park Drive, Wayne, PA 19087.

     (b) Employee has carefully read and fully understands all of the provisions
of the Notice and the Agreement which set forth the entire agreement between him
and Safeguard, and he acknowledges that he has not relied upon any
representation or statement, written or oral, not set forth in this document.

     (c) This Agreement is made in the Commonwealth of Pennsylvania and shall be
interpreted under the laws thereof. Its language shall be construed as a whole,
to give effect to its fair meaning and to preserve its enforceability.

     (d) Employee agrees that any breach of this Agreement by Employee will
cause irreparable damage to Safeguard and that in the event of such breach
Safeguard shall have, in addition to any and all remedies of law, the right to
an injunction, specific performance or other equitable relief to prevent the
violation of Employee’s obligations hereunder.

     (e) No term or condition set forth in this letter may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing and signed by Employee and the Chief Executive Officer of Safeguard or
another duly authorized officer of Safeguard.

     (f) Any waiver by Safeguard of a breach of any provision of this Agreement
shall not operate or be construed as a waiver of any subsequent breach of such
provision or any other provision hereof.

     (g) Each covenant, paragraph and division of this Agreement is intended to
be severable and distinct, and if any paragraph, subparagraph, provision or term
of this

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Agreement is deemed to be unlawful or unenforceable, such a determination will
not impair the legitimacy or enforceability of any other aspect of the
Agreement.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
written above.

              Date:  

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        [Name of Employee]
 
                    SAFEGUARD SCIENTIFICS, INC.
Date:
 

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      By:  

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        Title

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EXHIBIT B

NON-COMPETITION AGREEMENT

     This NON-COMPETITION AGREEMENT (hereinafter the “Agreement”) is made and
entered into as of this                    day of                    , 200_, by
and between SAFEGUARD SCIENTIFICS, INC. (the “Company”) and [Name of Managing
Director] (“Employee”).

     1. Background. The parties hereto acknowledge that this Agreement is being
entered into pursuant to the terms of the Letter Agreement, dated              
      between the Company and Employee (the “Letter Agreement”). As used in this
Agreement, any reference to “Majority Subsidiary” shall mean any person or
entity that at the date of this Agreement has a majority of its outstanding
voting securities owned directly or indirectly by the Company; “Partner Company”
shall mean any person or entity in which, at the date hereof, the Company has
made, or is actively considering making, an equity or debt investment or
acquisition.

     2. Confidentiality and Non-Disclosure. (a) I will not reveal to any person
or entity any of the trade secrets or confidential information of the Company or
of any Partner Company (including but not limited to trade secrets or
confidential information respecting inventions, products, designs, methods,
know-how, techniques, systems, processes, software programs, works of
authorship, customer lists, employee lists, customer lists, projects, plans and
proposals) and I shall keep secret all matters entrusted to me and shall not use
or attempt to use any such information in any manner which may injure or cause
loss or may be calculated to injure or cause loss, whether directly or
indirectly, to the Company. The above restrictions shall not apply to: (i)
information that at the time of disclosure is in the public domain through no
fault of mine; (ii) information received from a third party outside of the
Company that was disclosed without a breach of any confidentiality obligation;
(iii) information approved for release by written authorization of the Company;
or (iv) information that may be required by law or an order of any court, agency
or proceeding to be disclosed; provided, I shall provide the Company notice of
any such required disclosure once I have knowledge of it and will help the
Company to the extent reasonable to obtain an appropriate protective order.

          (b) Upon termination of my employment, I shall not take, use or permit
to be used any notes, memoranda, reports, lists, records, drawings, sketches,
specifications, software programs, data, documentation or other materials of any
nature relating to any matter within the scope of the business of the Company or
any Partner Company concerning any of its dealings or affairs, it being agreed
that all of the foregoing shall be and remain the sole and exclusive property of
the Company or the Partner Company, as appropriate, and that immediately upon
the termination of my employment I shall deliver all of the foregoing, and all
copies thereof, to the Company, at its main office.

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     3. Ownership of Inventions and Ideas. I acknowledge that the Company shall
be the sole owner of all patents, patent applications, patent rights, formulas,
copyrights, inventions, developments, discoveries, other improvements, data,
documentation, drawings, charts, and other written, audio and/or visual
materials relating to equipment, methods, products, processes, or programs in
connection with or useful to the business of the Company or a Partner Company
(collectively, the “Developments”) which I, by myself or in conjunction with any
other person, conceived, made, acquired, acquired knowledge of, developed or
created during the term of my employment with the Company, free and clear of any
claims by me (or any successor or assignee of mine) of any kind or character
whatsoever other than my rights under the Letter Agreement. I acknowledge that
all copyrightable Developments shall be considered works made for hire under the
Federal Copyright Act. I hereby assign and transfer my right, title and interest
in and to all such Developments, and agree that I shall, at the request of the
Company, execute or cooperate with the Company in any patent applications,
execute such assignments, certificates or other instruments, and do any and all
other acts, as the Company from time to time reasonably deems necessary or
desirable to evidence, establish, maintain, perfect, protect, enforce or defend
the Company’s right, title and interest in or to any such Developments.

     4. Non-Compete. Until the first anniversary of the date hereof (the
“Restricted Period”), I agree that I will not:

          (i) directly or indirectly solicit, entice or induce any customer of
the Company or a Majority Subsidiary to become a customer of any other person,
firm or corporation with respect to products and/or services then sold by the
Company or to cease doing business with the Company, and I shall not approach
any such person, firm or corporation for such purpose or authorize or knowingly
approve the taking of such actions by any other person;

          (ii) directly or indirectly solicit, recruit or hire any person who
was an employee of the Company or a Majority Subsidiary on the date of my
termination of employment to work for a third party other than the Company or
such Majority Subsidiary or engage in any activity that would cause any employee
to violate any agreement with the Company or such Majority Subsidiary; provided
that I shall not be prohibited from soliciting any person who, at the time of
solicitation, is no longer employed by the Company or a Majority Subsidiary and
who was not induced to leave employment in violation of this sub-paragraph (ii);
or

          (iii) whether alone or as a partner, officer, director, consultant,
agent, employee or stockholder of any company or other commercial enterprise,
directly or indirectly engage in any business or other activity which is
competitive in the same service areas with the products or services being
manufactured, marketed, distributed, or provided by the Company or a Majority
Subsidiary at the time of termination of my employment (“Competitive
Activities”). The foregoing prohibition shall not prevent (i) my ownership of
securities of a public company not in excess of five percent (5%) of any

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class of such securities, or (ii) my employment or engagement by a company or
business organization which during the previous 12 months did not generate, or
during the next 12 months does not seek to generate, more than 5% of its
consolidated revenues from Competitive Activities, provided that my
responsibilities for such company or business organization do not require me to
engage in Competitive Activities or to violate sub-paragraphs (i) or (ii) of
this Section.

     5. Reasonable Restrictions. I agree that any breach of this Agreement by me
will cause irreparable damage to the Company and that in the event of such
breach the Company shall have, in addition to any and all remedies of law, the
right to an injunction, specific performance or other equitable relief to
prevent the violation of my obligations hereunder. I hereby acknowledge that the
type and periods of restriction imposed in the provisions of this Agreement are
fair and reasonable and are reasonably required for the protection of the
Company and the goodwill associated with the business of the Company. I
represent that my experience and capabilities are such that the restrictions
contained herein will not prevent me from obtaining employment or otherwise
earning a living at the same general economic benefit as reasonably required by
me. I further agree that each provision herein shall be treated as a separate
and independent clause, and the unenforceability of any one clause shall in no
way impair the enforceability of any of the other clauses herein. Moreover, if
one or more of the provisions contained in this Agreement shall for any reason
be held to be excessively broad as to scope, activity or subject so as to be
unenforceable at law, such provision or provisions shall be construed by the
appropriate judicial body by limiting and reducing it or them, so as to be
enforceable to the maximum extent compatible with the applicable law as it shall
then appear.

     6. General. Any waiver by the Company of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent breach
of such provision or any other provision hereof. No term or condition set forth
in this letter may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by me and an
officer of the Company authorized to sign such writing by the Board of Directors
of Safeguard. My obligations under this Agreement shall survive the termination
of my employment regardless of the manner of such termination and shall be
binding upon my heirs, executors, administrators and legal representatives. This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania. Any controversy or claim arising out of or
relating to this agreement, or the breach thereof (other than a request for
equitable relief) will be settled by arbitration in Philadelphia, Pennsylvania,
in accordance with the National Rules for the Resolution of Employment Disputes
of the American Arbitration Association, using one arbitrator, and judgment upon
the award rendered by the arbitrator may be entered in any court of competent
jurisdiction.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
written above.

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              Date:  

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        [Name of Employee]
 
                    SAFEGUARD SCIENTIFICS, INC.
Date:
 

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      By:  

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        Title

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