95  Enterprise
                                              Aliso Viejo, California 92656-2601
SAFEGUARD                                     949.425.4300



CONTACT:    DENNIS  L.  GATES
            SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
            (949) 425-4531


            SAFEGUARD  COMPLETES RECAPITALIZATION, STRENGTHENING
              BALANCE SHEET AND POSITIONING COMPANY FOR GROWTH


ALISO  VIEJO, CALIFORNIA (FEBRUARY 8, 2001) - SafeGuard Health Enterprises, Inc.
(OTC  BULLETIN  BOARD:  SFGD) today announced it has completed the conversion of
approximately  $53  million  of  debt  and  accrued  interest  into  convertible
preferred  stock  which  carries  no  dividend.  This  transaction significantly
strengthens  the  Company's  balance  sheet.  As  a  result,  John  Hancock Life
Insurance  Company,  a  subsidiary  of  John  Hancock  Financial Services, Inc.,
(NYSE:JHF)  owns  directly  or  indirectly approximately 40% of the Company; CAI
Partners,  an  investment  partnership  with  significant  experience  in  the
healthcare  industry, owns approximately 24% of the Company; Jack R. Anderson, a
well-known  healthcare  investor,  owns  approximately  7%  of  the Company; and
management  owns,  including  stock  options,  approximately  9% of the Company.

In  commenting on the closing, James E. Buncher, SafeGuard's President and Chief
Executive  Officer,  said,  "We  are pleased to have completed this transaction,
which  leaves  SafeGuard  with  a  strong  balance sheet, virtually no debt, net
interest  income  and  strong financial partners.  This transaction restores the
Company's financial strength and places the Company in a position to execute its
future  growth  plans,  including  pursuing  value-added  acquisitions and other
development opportunities.  We continue to build positive momentum, generated by
our focus on cost controls and consolidation of administrative services, as well
as the successful implementation of a number of major service programs to ensure
that  our  brokers,  members, clients and providers receive outstanding customer
service."

The Company also announced that, in connection with this transaction, Stephen J.
Blewitt,  Managing  Director  of  the  Bond  and Corporate Finance Group of John
Hancock  Life  Insurance  Company,  joined  SafeGuard's  board  of  directors,
increasing  the  number  of board members to seven.  In addition to serving as a
Managing  Director  of  the  Bond  and Corporate Finance Group, Mr. Blewitt also
serves  as a Director of Learning Curve International.  Mr. Blewitt received his
bachelor's  degree  from  the University of Chicago and his master's degree from
Boston  University.



SFGD Closes Recapitalization Transaction
Page  2
February  8,  2001

SafeGuard provides managed care dental plans, PPO/indemnity dental plans, vision
benefit  plans,  administrative  services,  and  preferred provider organization
services.  The  Company  serves  approximately  800,000  members,  primarily  in
California,  Texas,  Florida  and  Missouri.

The  Company  notes  that statements contained in this news release that are not
based  on  historical  facts  are  forward-looking  statements, and as such, are
subject  to  uncertainties  and  risks that could cause actual results to differ
materially  from  those  projected  or implied by such statements.  These risks,
contingencies  and  uncertainties,  many  of which are beyond the control of the
Company,  include those risk factors and other information that are set forth in
the  Company's  Annual Report on Form 10-K for the year ended December 31, 1999,
the Company's Report on Form 8-K as of March 16, 2000, and the Company's Reports
on Form 10-Q for the quarters ended March 31, 2000, June 30, 2000, and September
30,  2000,  on  file  with  the  U.S.  Securities  and  Exchange  Commission.

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