The analysis didn't take the warrants into consideration, using only a
58% interest in CLRT to determine valuation, so yes, it is actually
higher. SFE may have other, earlier, warrants in CLRT as well and
could end up with more if CLRT can't refinance the remaining SFE loan
by end of this year. At one point from calculations including things
like warrants, I thought SFE had a 62% controlling interest, but SFE
only shows 58% on their slides these days.

Here's an attempt at a conservative valuation analysis. Your thoughts
appreciated..

====Tech Company Valuations====
**This group is struggling to produce value.

Authentium (20%): Approx. $5MM rev from other products, but
SafeCentral.com does not seem to be getting traction based on
compete.com stats. Valuation: $1MM.

Advantedge Healthcare (38%). Approx $10MM rev, but not growing fast
enough to compete with bigger players. Acquisition strategy of small
Mom/Pop billing services won't be fast enough to win. Valuation: $3MM

Beyond.com (37%) 1MM+ unique website views per month. $10MM annual
revenue. Has promise and is an acquisition target. Valuation: $12MM
which is SFE carrying value until proven otherwise.

Bridgevine.com (21.1%) The Amazon of Services. 500K+ unique web
visitors per month. Will hit at least $25MM 2008 revenue. Excellent
network of deep B2B partnerships. Carrying value of $7.4. Seems better
than that.
Valuation $10MM

Genband (2.2%) Through acquisition of Nextone/Nextpoint which SFE
stake was worth about $24MM based on SFE increased investment and
valuation in attempted bundled sale. SFE thinks this is a homerun.
Valuation $24MM.

Portico (46.8%). Growing nicely. Positive earnings. $11MM+ 2008
revenue. Carrying value of $5.5MM but seems better than that.
Valuation: $9MM.

Kadoo (14%) Recently launched. Partership with Blackboard is promising
but unproven. Need to raise more funds soon. Valuation: $0.

Swaptree (29%). Unproven revenue model. Valuation $0.

Total tech valuations: $59MM with only Beyond.com appearing to be a
liquidity exit candidate within the next 16 months. In summary, don't
buy SFE for their tech holdings...

=====Life Sciences Group==========
** These are the guys who make SFE valuable.

Advanced BioHealing (28.3%) Winner! Expect better than 3-5x return.
40MM annual runrate and growing into 4 Billion hot market for diabetic
foot ulcers. Conservative valuation 3x what SFE invested: $33MM.

Alverix (50%) Diagnostic spinout with promise. Recently Invested $5MM.
Valuation $5MM.

Avid (14.2%) Winner! Alzheimer's diagnostics and more. Huge 100MM+
market opportunities in multiple diagnostic spaces. Expect better than
3-5x return. Invested $7.3 MM. Conservative Valuation $22MM.

Cellumen (40%) Seems promising. Excellent partnerships. SFE invested
$6MM. Still early so valuation $6MM.
++ Cernostics Pathology (??) Spinoff from Cellumen. How much does
Cellumen own? Unknown.

Clarient (58+%) Winner! Rapid revenue growth rate. At current stock
price of 1.80, SFE's share is worth $75MM.

NuPathe (27.8%) . Winner! SFE invested $6MM and appears to be worth
$12MM already from price of recent additional investments.

Rubicor. Hitting COGS and insufficient manufacturing capacity
problems. Will not meet 2008 growth targets. Wonder if those eager
buyers for this technology that were touted in 2007 are still there...
Valuation $5MM.

Life Sciences Valuation: $158MM

Total partner company valuations: 59 + 158 = $217MM

---The Basics---

SFE Shares Outstanding: Approx 120MM
SFE Cash: $123MM
Annual burn rate from operations: $16MM
SFE Debenture Debt: $91MM due 2011 (approx. $66MM at present day
value. Recently bought back $38MM at .78 on the dollar.)

SFE Short and Long term liabilities: $17MM

Possible lawsuit loss from PacTitle: $15MM although this may be
covered by SFE's insurance carriers. (if they didn't go bankrupt
recently.)

So...

Assets: $123MM cash + $217MM = $340MM
(Note: SFE has over $400MM in tax-loss offsets so partner company
sales won't incur capital gains.)

Liabilities: $66MM Debentures + $17MM debt + $15MM possible lawsuit
from PacTitle = $98MM

($340 - $98)/120MM shares =

...drumroll please...

$2.01/share in value assuming assets increase to offset $16MM/year
operations burn rate.

Your thoughts? Anything missing? Anything which is significantly off
or not conservative enough?

Wow Erik, thanks for that.