def14aproxy2012.htm

DEF 14A 1 def14aproxy2012.htm 2012 PROXY def14aproxy2012.htm

SECURITY CAPITAL CORPORATION

BATESVILLE, MISSISSIPPI

NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS

March 9, 2012

Dear Shareholder:

Enclosed you will find a Notice of the Annual Shareholders Meeting for 2012, a Five Year Summary of Financial Data and a Request Form for an Annual Report and Proxy Statement.

In a continuing effort to improve earnings, the Board of Directors has adopted the new proxy access rules as set by the Securities and Exchange Commission and, therefore, lowering the costs related to printing and mailing proxy materials.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Held on April 19, 2012.

·	This communication presents only an overview of the more complete proxy materials that are available to you on the Internet. We encourage you to access and review all of the important information contained in the proxy materials before voting.

·	The Proxy Statement and the 2011 Annual Report are available at www.firstsecuritybk.com/AnnualReport. Your password to access the reports is:

SH2012

If you want to receive a paper copy or an e-mail copy of these documents, you must request one. There is no charge to you for requesting a copy. Please make your request for a copy as instructed on the enclosed Request for an Annual Report and Proxy Statement on or before April 6, 2012, to facilitate timely delivery. A self-addressed, stamped envelope is enclosed for your convenience.

The Annual Shareholders Meeting is to be held on Thursday, April 19, 2012, at 10:00 A.M. at the Home Office of First Security Bank, located at 295 Highway 6 West, Batesville, Mississippi.

Your 2012 Proxy will be mailed on April 6, 2012. I urge you to complete the Proxy promptly on receiving it and return it in the enclosed self-addressed postage paid envelope that will be provided, even if you plan to attend the meeting.

This institution is grateful for the loyalty and support of you, our friends and shareholders. We look forward to seeing you at the Annual Meeting.

Sincerely yours,

SECURITY CAPITAL CORPORATION

Frank WestPresident and CEO

Table of Contents


NOTICE OF ANNUAL SHAREHOLDER'S MEETING			1

PROXY STATEMENT

SOLICITATION BY BOARD OF DIRECTORS OF SECURITY CAPITAL CORPORATION			2

PROPOSAL NO.1 - ELECTION OF DIRECTIORS (ITEM 1) ON PROXY CARD			3

REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION			14

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS			18

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND FEES			18

COMMITTEES OF THE BOARD OF DIRECTORS			19

REPORT OF THE AUDIT COMMITTEE			20

OTHER MATTERS			21

PROPOSALS FOR 2013 ANNUAL METING			21

SECURITY CAPITAL CORPORATION

POST OFFICE BOX 690

BATESVILLE, MISSISSIPPI 38606

March 9, 2012

NOTICE OF ANNUAL SHAREHOLDERS’ MEETING

To the Shareholders of

Security Capital Corporation

Batesville, Mississippi 38606

NOTICE IS HEREBY GIVEN that, pursuant to call of its Directors and in compliance with the Bylaws, the regular annual meeting of shareholders of the Security Capital Corporation (the ‘Company’), Batesville, Mississippi, will be held at the Home Office of First Security Bank, located at 295 Highway 6 West, Batesville, Mississippi, on Thursday, April 19, 2012, at 10:00 A.M. for the purpose of considering and voting on the following proposals:

1.	ELECTION OF DIRECTORS: The election of three (3) persons listed in the Proxy Statement dated March 9, 2012, accompanying this notice, as members of the Board of Directors for a term of three years expiring 2015.

2.	Whatever other business may be properly brought before the meeting or any adjournment thereof.

Whether or not you contemplate attending the meeting, it is requested that you complete and return your Proxy as soon as possible. Proxies will be mailed on April 6, 2012. If you attend the meeting, you may withdraw your Proxy and vote in person.

Only those shareholders of record at the close of business on March 9, 2012, shall be entitled to notice of and to vote at this meeting.

BY ORDER OF THE BOARD OF DIRECTORS

Frank West

President and CEO

Dated and available at

Batesville, Mississippi

On or about March 9, 2012

SECURITY CAPITAL CORPORATION

POST OFFICE BOX 690

BATESVILLE, MISSISSIPPI 38606

PROXY STATEMENT

ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON

APRIL 19, 2012

SOLICITATION BY BOARD OF DIRECTORS OF

SECURITY CAPITAL CORPORATION

This statement is furnished to the shareholders of Security Capital Corporation (the ‘Company’) in connection with the solicitation by the Board of Directors of Proxies to be voted at the Annual Meeting of Shareholders to be held at the Home Office of First Security Bank, located at 295 Highway 6 West, Batesville, Mississippi, on Thursday, April 19, 2012, at 10:00 A.M., local time or any adjournment (s) thereof, for the matters set out in the foregoing notice of Annual Shareholders’ Meeting. The approximate date on which this Proxy Statement and form of proxy are first being available to shareholders is March 9, 2012.

Only those shareholders of record on the books of the Company at the close of business on March 9, 2012 (the ‘Record Date’) are entitled to notice of and to vote at the meeting. On March 9, 2012, the Company had outstanding of record 2,883,309 shares of Common Stock. Each share is entitled to one (1) vote. In the election of Directors, each shareholder has cumulative voting rights, so that a shareholder may vote the number of shares owned by him for as many persons as there are Directors to be elected, or he may multiply the number of shares by the number of Directors to be elected and allocate the resulting votes to one or any number of candidates. For example, if the number of Directors to be elected is three (3), a shareholder owning ten (10) shares may cast ten (10) votes for each of the three (3) nominees, or cast thirty (30) votes for any one (1) nominee or allocate the thirty (30) votes among several nominees.

The cost of soliciting proxies from shareholders will be borne by the Company. The initial solicitation will be by mail. Thereafter, proxies may be solicited by Directors, officers and regular employees of the Company, by means of telephone, e-mail or personal contact, but without additional compensation therefore. The Company will reimburse brokers and other persons holding shares as nominees for their reasonable expenses in sending proxy soliciting material to the beneficial owners.

Any shareholder giving a Proxy has the right to revoke it at anytime before it is exercised. A shareholder may revoke his Proxy (1) by personally appearing at the Annual Meeting, (2) by written notification to the Company which is received prior to the exercise of the Proxy or (3) by a subsequent Proxy executed by the person executing the prior Proxy and presented at the Annual Meeting. All properly executed Proxies, if not revoked, will be voted as directed on all matters proposed by the Board of Directors, and, if the shareholder does not direct to the contrary, the shares will be voted ‘For’ each of the proposals described below.

The presence at the Annual Meeting, in person or by Proxy, of a majority of the shares of Common Stock outstanding on March 9, 2012 and entitled to vote, will constitute a quorum. Abstentions and broker non-votes are counted only for the purpose of determining whether a quorum is present at the meeting. Broker non-votes and shareholder abstentions are not counted in determining whether or not a matter has been approved by shareholders.

The 2011 Annual Report to shareholders of the Company is available on the website, www.firstsecuritybk.com, or by request for the information from the shareholders.

PROPOSAL NO. 1 – ELECTION OF DIRECTORS (ITEM 1 ON PROXY CARD)

The Board of Directors of the Company is divided into three (3) classes - Class I, Class II, and Class III. Each class consists of three Directors. The term of Class I Directors expires at the 2012 Annual Meeting. The term of Class II Directors expires at the 2013 Annual Meeting. The term of the Class III Directors expires at the 2014 Annual Meeting.

The Nominating Committee of the Board of Directors has nominated Larry Pratt, Frank West and Will Hays for election as Class I Directors to serve until the 2015 Annual Meeting. All nominees are currently serving as directors of the Company

Unless authority is expressly withheld, the proxy holders will vote the proxies received by them for the three nominees for Class I Director listed above, reserving the right, however, to cumulate their votes and distribute them among the nominees, in their discretion. Although each nominee has consented to being named in this Proxy Statement and to serve if elected, if any nominee should prior to the Annual Meeting decline or become unable to serve as a Director, the proxies will be voted by the proxy holders for such other persons as may be designated by the present Board of Directors. During 2011, the Company’s Board of Directors had twenty-two (22) regular board meetings. All directors excluding one attended more than 75% of the total number of meetings of the Board of Directors or committees upon which he served. Newly elected director, George C. Carlson, attended only 62% of his possible meetings due to pre-existing out-of-town commitments in the months immediately following his election in April of 2011 and also to unexpected family emergencies in other months.

Pursuant to Mississippi law and the Company’s Bylaws, directors are elected by a plurality of the votes cast in the election of Directors. A “plurality” means that the individuals with the largest number of favorable votes are elected as Director up to the maximum number of Directors to be chosen at the meeting.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION OF ALL THE NOMINEES.

INFORMATION CONCERNING NOMINEES, DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the nominees and the other directors and executive officers of the Company. The principal occupation of each person has been the same for the last five years, unless otherwise indicated in a footnote. The directors serve for staggered three-year terms. The officers of both Security Capital Corporation and First Security Bank are all elected for terms of one year. The Board of First Security Bank by resolution designated Larry Pratt as chairman on January 21, 1999. Mr. Pratt has served on the Board of First Security bank since 1970. On January 21, 1999, the Board of First Security Bank designated Frank West as President; and on January 1, 2002, the Board appointed Mr. West as Chief Executive Officer of First Security Bank.

	Positions Currently
	Held with the		Principal
Name and Age	Corporation and Bank	Since	Occupation

Larry J. Pratt	Chairman of the Corporation	1999	Banker
Age 72	Director of the Corporation	1983
	Chairman of the Bank	1999
	Director of the Bank	1970


Joe M. Brown	Director of the Corporation*	1983	Justice Court Judge
Age 75	Director of the Bank*	1977


Frank West	Director of the Corporation	1999	Banker
Age 60	Director of the Bank	1999
	President of the Corporation	1999
	President of the Bank	1999
	CEO of the Corporation	2002
	CEO of the Bank	2002


Will Hays	Director of the Corporation*	2000	Retired Farmer
Age 72	Director of the Bank*	2000


Tony Jones	Director of the Corporation*	2003	Real Estate Broker
Age 59	Director of the Bank*	2003	and Developer


Laney Funderburk	Director of the Corporation*	2005	Real Estate Developer
Age 66	Director of the Bank*	2005


Ken Murphree	Director of the Corporation*	2007	Consultant, Realtor &
Age 65	Director of the Bank*	2007	County Official (1)

	Positions Currently
	Held with the		Principal
Name and Age	Corporation and Bank	Since	Occupation

John L. King, Jr.	Director of the Corporation*	2010	Corporate Officer (2)
Age 70	Director of the Bank*	2010



George C. Carlson	Director of the Corporation*	2011	Appellate Judge (3)
Age 65	Director of the Bank*	2011


William R. Fleming	Vice-President of the Corporation	1999	Banker
Age 63	Executive Vice-President &	2002
	Senior Trust Officer of the Bank


Connie Hawkins	Secretary/Treasuer of the	1999	Banker
Age 59	Corporation
	Executive Vice-President, CFO &	2002
	Cashier of the Bank


Jeff Herron	Executive Vice-President &	2005	Banker
Age 58	Loan Administrator


Dwayne Myers	Executive Vice-President &	2008	Banker (4)
Age 52	Senior Loan Administrator

*Independent Director

(1)

Mr. Murphree served numerous years in Desoto County and Tunica County as county administrator. He retired in 2005 from public service. In 2010, he was designated to serve temporarily as a county official in Tunica County. In 2011, he was succeeded by the successful candidate in the election race for the county position.

(2)	Mr. King has a career in the tire industry and continues to serve as an officer and employee of the corporation.

(3)	Mr. Carlson’s career included practicing law for 10 years, serving as a trial judge for 19 years and serving as an appellate judge for the last 10 years.

(4)	Mr. Myers was engaged in 2008 to serve as Executive Vice-President and Loan Administrator. In 2009, he was designated as Senior Loan Administrator. Prior to his employment, he served other financial institutions in lending.

Seven (7) of the Company’s directors, constituting a majority, are independent. No family relationship exists between any directors, executive officers, or persons nominated to become director of the Company.

It is the Company’s policy that members of the Board of Directors attend the annual meeting of shareholders. At the 2011 annual meeting, eight (8) directors of the Company were in attendance.

DIRECTOR QUALIFICATIONS

Name	Qualifications

Larry Pratt

Banking experience in lending, asset/liability management, investments, policies and procedures, etc; experienced bank director; knowledge of institution, community, current banking laws and regulations and current economic pressures in the banking industry.

Joe M. Brown

Knowledge of insurance industry; experienced bank director; knowledge of institution, community, current banking laws and regulations and current economic pressures in the banking industry.

Frank West

Banking experience in lending, asset/liability management, investments, policies and procedures, etc; experienced bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

Will Hays

Experienced in agricultural industry; community involvement; experienced bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

Tony Jones

Knowledge of real estate markets; leadership in the real estate industry; experienced bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

Laney Funderburk

Knowledge of real estate markets; leadership in community; experienced bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

Ken Murphree

Experience in and knowledge of local government; experienced bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

John L. King, Jr.

Extensive experience in business; knowledge of banking communities; leadership in community; long-standing relationship as a customer and shareholder of the institution.

George C. Carlson

Experience and knowledge in law and law practices; prior experience as a bank director; knowledge of institution, community, current banking laws and regulations, and current economic pressures in the banking industry.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Principal Holders of Common Stock

As of December 31, 2011, Security Capital Corporation had one shareholder that was the beneficial owner of more than 5% of the Common Stock of Security Capital Corporation and is listed below:

	Number of Shares/
	Nature of Beneficial
Name and Address of Beneficial Owner	Ownership (1)		Percentage

First Security Bank Employee Stock		210,078		7.29	%
Ownership Plan
First Security Bank Trust Department
P. O. Box 690
Batesville, Mississippi 38606

(1) Constitutes sole ownership.

The following table sets forth as of December 31, 2011 the number and percentage of Common Stock beneficially owned by each director of Security Capital Corporation and by all of the Corporation’s directors and executive officers as a group. Unless indicated otherwise in a footnote, the directors and the executive officers possess sole voting and investment power with respect to all shares shown.

			Number of
			Shares
			Beneficially
Name of Beneficial Owner			Owned		Percentage

Larry J. Pratt	(1	)		36,355		1.26	%

Joe M. Brown	(2	)		13,752		*

Frank West	(3	)		35,564		1.23	%

Will Hays				9,184		*

Tony Jones	(4	)		3,063		*

Laney Funderburk	(5	)		4,087		*

Ken Murphree	(6	)		2,379		*

John L. King, Jr.	(7	)		36,216		1.26	%

George C. Carlson	(8	)		139,386		4.83	%

William R. Fleming	(9	)		14,582		*

Connie Hawkins	(10	)		12,708		*

Jeff Herron	(11	)		7,110		*

Dwayne Myers	(12	)		1,680		*

(1	)	Includes 1,017 shares held in his personal retirement account.

(2	)	Includes 9,884 shares owned jointly with his spouse.

(3	)	Includes 136 shares held jointly with his spouse, 4,030 shares held by Mr. West's spouse's retirement
		account and 358 shares jointly owned with his children and 28,964 shares held by his personal
		retirement accounts.

(4	)	Includes 2,760 shares held jointly with his spouse and 5 shares held by a grandchild under his
		custodianship.

(5	)	Includes 4,045 shares held jointly with his spouse.

(6	)	Includes 10 shares held jointly with his spouse, 2,170 shares held in his personal retirement account and
		157 shares held in his spouse's retirement account.

(7	)	Includes 35,841 shares held jointly with his spouse and 375 shares held by his spouse.

(8	)	Includes 112,176 shares held in trusts which he serves as trustee.

(9	)	Includes 50 shares held jointly with his spouse, 8,964 shares held in a custodial account and 310 shares
		held in his personal retirement accounts.

(10	)	Includes 1,335 shares held by her spouse's retirement plan, 9,334 shares held in her personal retirement
		accounts and 354 shares jointly owned with family.

(11	)	Includes 173 shares held jointly with his spouse and 6,937 shares held in his personal retirement
		accounts.

(12	)	Includes 150 shares held jointly with his spouse and 1,530 shares held by his personal retirement accounts.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s directors and executive officers to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of common stock. Executive officers and directors are required by Securities and Exchange Commission regulation to furnish the Company with copies of all Section 16(a) forms they file. To the Company’s knowledge, based solely on a review of the copies of such reports furnished to the Company, during the fiscal year ended December 31, 2011, all Section 16(a) filing requirements applicable to the Company’s executive officers and directors were complied with.

COMPENSATION DISCUSSION AND ANALYSIS

Overview of Compensation Program

The Compensation Committee (for purposes of this analysis, the “Committee”) of the Board has the responsibility for establishing, implementing and continually monitoring adherence with the Company’s compensation philosophy. The Committee ensures that the total compensation paid to the named executive officers is fair, reasonable and competitive. Generally, the types of compensation and benefits provided to the named executive officers, including the actively-employed name executive officers, are similar to those provided to other executive officers of bank holding companies of similar asset sizes, performance, growth, and demographics in relation to the Company.

Throughout this proxy statement, the individuals who serve as the Company’s Chief Executive Officer and Chief Financial Officer during fiscal 2011, as well as the other individuals included in the Summary Compensation Table on a subsequent page, are referred to as the “named executive officers.”

Compensation Philosophy and Objectives

The Committee believes that the most effective executive compensation program is one that is designed to reward the achievement of specific annual, long-term and strategic goals by the Company, and which aligns the interests of the executive officers with the Company’s overall business strategy, values and management initiatives. These policies are intended to reward executives for strategic management and the enhancement of shareholder value and support a performance-oriented environment that rewards achievement of internal goals. The Committee evaluates both performance and compensation to ensure that the Company maintains its ability to attract and retain superior employees in key positions and that compensation provided to key employees remains competitive relative to the compensation paid to similarly situated executives of our peer companies. To that end, the Committee believes executive compensation packages provided by the Company to its executives, including the named executive officers should be designed to include compensation elements that reward performance as measured against established goals.

Role of Executive Officers in Compensation Decisions

As discussed, below, the Chief Executive Officer, working with the Company’s Human Resources Officer, conducts an annual review of the salary of the Company’s executive officers (other than the Chairman of the Board and the Chief Executive Officer whose performance is reviewed by the Committee). The Chief Executive Officer makes recommendations regarding salary and bonus for the executive officers.

Setting Executive Compensation

Based on the foregoing objectives, the Committee has structured the Company’s executive compensation to motivate executives to achieve the business goals set by the Company and reward the executives for achieving such goals. Based upon the subjective assessment of the nature of the position as well as the contributions, experience and company tenure of the executive officer, adjustments in base salary for the executive officers are made by the Compensation Committee. Additionally, the Company reviews the current compensation practices of financial institutions of similar asset size to ensure that its compensation practices, policies and programs are competitive or at the least median of these institutions. Usage of comparative compensation data from the market areas and its peer groups allows the Company to retain talented executive officers who contribute to the Company’s overall and long-term success.

Compensation Policies and Practices as They Relate to Risk Management

As participants in the TARP Community Development Capital Initiative (the “CDCI”) administered by the United States Department of the Treasury, the Company is subject to the executive compensation requirements of the Emergency Economic Stabilization Act of 2008 (“EESA”) and as amended by the American Recovery and Reinvestment Act of 2010 (“ARRA”). In compliance therewith the Compensation Committee of the Board of Directors of the Company meets at least semi-annually to discuss and evaluate employee compensation plans in light of its assessment of risk posed to the Company from such plans and to ensure compliance with executive compensation rules and regulations implemented under EESA and ARRA. The Compensation Committee met twice in 2011 to review the Company’s compensation plans and determined that the Company had no compensation plans that would encourage manipulation of reported earnings to enhance compensation or encourage unnecessary or excessive risk-taking. The Compensation Committee has determined that there are no compensation policies or procedures that are likely to have a material adverse effect on the Company.

Capital Purchase Program and Community Development Capital Initiative – Effect on Executive Compensation

In June 2010 the Company entered into a transaction with the Department of the Treasury under the TARP Capital Purchase Program (“CPP”). On September 29, 2010, the Company closed a transaction whereby the Treasury exchanged its 17,910 shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series UST and Series UST/W issued under CPP for 17,910 shares of a new series of preferred stock designated Fixed Rate Cumulative Perpetual Preferred Stock, Series CD (the “CDCI Preferred Shares”) issued under the CDCI. In order to participate in the CPP and the CDCI, the Company was required to adopt the Treasury standards for executive compensation and corporate governance for the period during which the Treasury holds equity in the Company issued under the CPP or the CDCI. The Company must meet certain standards, including: (1) ensuring that incentive compensation for certain senior executives does not encourage unnecessary and excessive risks that threaten the value of the Company; (2) requiring a return to the Company of any bonus or incentive compensation paid to certain senior executives based on financial statements or other performance metric criteria that are later proven to be materially inaccurate; (3) prohibiting the Company from making certain excess payments to certain senior executives made on account of involuntary separations from service or in connection with a bankruptcy, insolvency or receivership of the Company; and (4) agreeing not to deduct for tax purposes executive compensation in excess of $500,000 for each applicable senior executive. These standards could change based on subsequent guidance issued by the Treasury or the Internal Revenue Service. Both prior to its participation in the CPP and the CDCI, and for so long as the Treasury continues to hold equity interests in the Company issued under the CPP or the CDCI, the Company will monitor its compensation arrangements and modify such compensation arrangements, agree to limit and limit its compensation deductions, and take such other actions as may be necessary to comply with the standards discussed above, as they may be modified from time to time. The Company does not anticipate that any material changes to its existing executive compensation structure will be required to comply with the executive compensation standards included under TARP.

Effect of American Recovery and Reinvestment Act of 2009

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (“ARRA”). ARRA contains expansive new restrictions on executive compensation for financial institutions and other companies participating in the TARP programs (including the CPP and the CDCI.) These restrictions, which have been implemented by regulations found at 31 CFR Part 30, apply to us.

ARRA prohibits bonus and similar payments to top employees. ARRA prohibits the payment of any “bonus, retention award, or incentive compensation” (as defined in ARRA) to the Chief Executive Officer of the Company for as long as any TARP-related obligations are outstanding. The prohibition does not apply to bonuses payable pursuant to certain “employment agreements” in effect prior to February 11, 2009. “Long-term restricted stock” is excluded from ARRA’s bonus prohibition, but only to the extent the value of the stock does not exceed one-third of the total amount of annual compensation of the employee receiving the stock, the stock does not “fully vest” until after all CPP-related obligations have been satisfied, and any other conditions which the Treasury may specify have been met.

ARRA prohibits any payment to the Chief Executive Officer and the four other highest paid executive officers of the Company and any of the next five most highly compensated employees due to a change in control or termination of employment for any reason for as long as any TARP-related obligations remain outstanding.

Under ARRA TARP-participating companies are required to recover any bonus or other incentive payment paid to the Chief Executive Officer and the four other highest paid executive officers of the Company or to the next 20 most highly compensated employees if paid on the basis of materially inaccurate financial or other performance criteria.

ARRA prohibits TARP participants from implementing any compensation plan that would encourage manipulation of the reported earnings of the Company in order to enhance the compensation of any of its employees.

ARRA requires the Chief Executive Officer and the Chief Financial Officer of any publicly-traded TARP-participating company to provide a written certification of compliance with the executive compensation restrictions in ARRA in the company’s annual filings with the SEC beginning in 2010.

ARRA requires each TARP-participating company to implement a company-wide policy regarding excessive or luxury expenditures, including excessive expenditures on entertainment or events, office and facility renovations, aviation or other transportation services.

ARRA directs the Treasury to review bonuses, retention awards, and other compensation paid to the Chief Executive Officer and the four other highest paid executive officers of the Company and the next 20 most highly compensated employees of each company receiving TARP assistance before ARRA was enacted, and to “seek to negotiate” with the TARP recipient and affected employees for reimbursement if it finds any such payments were inconsistent with TARP or otherwise in conflict with the public interest.

The Compensation Committee will consider these new limits on executive compensation and determine how they impact the Company’s executive compensation program.

2011 Executive Compensation Components

Historically, and for the fiscal year ended December 31, 2011, the principal components of compensation for named executive officers were:

·	base salary;

·	performance-based bonus compensation;

·	retirement benefits; and

·	perquisites and other personal benefits.

Base Salary

Base Salary of Executive Officers (excluding the Chairman of the Board and the Chief Executive Officer). The Company provides named officers and other employees with base salary to compensate them for services rendered during the fiscal year. Salaries paid to executive officers (other than the Chairman and Chief Executive Officer) are reviewed annually by the Chief Executive of the Company and the Human Resources Officer. Based upon the subjective assessment of the nature of the position as well as the contributions, experience and company tenure of the executive officer, the Chief Executive Officer then makes suggestions as to adjustments in base salary for practices of financial institutions of similar asset size to ensure that its compensation practices, policies and programs are competitive or at the lest median of these institutions. Usage of comparative compensation data from the market areas and its peer groups allows the Company to retain talented executive officers who contribute to the Company’s overall and long-term success.

Base Salary of Chairman of the Board and Chief Executive Officer. During its review of base salaries for the Chairman of the Board and the Chief Executive Officer, the Committee primarily considers individual performance of the executive, overall performance of the Company, in addition to publicly disclosed compensation of chief executive officers of other bank holding companies of similar asset size, performance, growth and demographics.

Performance-Based Bonus Compensation

Annual Bonus of Executive Officers (excluding the Chairman of the Board and the Chief Executive Officer): Each fiscal year, the Chief Executive Officer, working with the Director of Human Resources and other Company executives, develops a Company-wide bonus proposal. The size of the bonus proposal is based upon a subjective assessment of overall Company and departmental performance as compared to budgeted and prior year performance, and the extent to which the Company achieved its overall financial performance goals and return on stockholders’ equity. The bonus proposal, containing the individual bonus recommendations for the executive officers, is then presented to the Board of Directors of the Company for modifications and approval. The annual bonus is paid before year end.

Annual Bonus of Chairman of the Board and Chief Executive Officer. Bonus proposals regarding the chairman and Chief Executive Officer, if any, are made by the Committee based on the same basic criteria applied to other executive officers.

Each year, the annual bonus is paid before year end. Bonus awards made to named executive officers are reflected in the Bonus column of the Summary Compensation Table on a subsequent page.

401(k) Plan and Employee Stock Ownership Plan

The Bank has a 401(k) plan which provides for certain salary deferrals, covering substantially all full-time employees of the Company and subsidiaries. The Company matches employee 401(k) contributions equal to 60% of an employee’s first 5% of salary deferral. Contributions to the ESOP portion of the plan are at the discretion of the Board of Directors. These discretionary contributions are invested in the Company’s common stock.

Each participant’s account is credited with the participant’s contributions and matching amounts contributed by the Company on behalf of the participant. Discretionary amounts contributed by the Company are allocated based on the participant’s annual compensation. Investment earnings on participant directed accounts are allocated based on each participant’s account earnings. Other investment earnings are allocated based on the balance of the participant’s account.

The matching contributions to the 401(k) portion of the plan and the discretionary contributions to the ESOP portion of the plan became 100% vested after 7 years of credited service. The participants are always 100% vested in the participant’s contributions. Forfeited nonvested accounts may be used to reduce future employer contributions or to allocate to other participants.

Upon termination of service, a participant may elect to receive either a lump-sum amount, periodic installments for a period not to exceed ten years, or a combination thereof.

The Company matching 401(k) contributions are included in item (1) and allocations of ESOP discretionary contributions are included in item (2) in the All Other Compensation column of the Summary Compensation Table on a subsequent page.

Perquisites and Other Personal Benefits

The Company provides named executive officers with perquisites and other personal benefits that the Company and the Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain superior employees for key positions. The Committee periodically reviews the levels of perquisites and other personal benefits provided to name executive officers.

The named executive officers are provided an automobile allowance and country club membership dues. Compensation attributed to the automobile allowance is included in item (3) of the Other column in the Summary Compensation Table on a subsequent page of this report. Compensation, attributed to country club membership and accounting and consulting fees, is included in item (4) and item (5), respectively, or the Other column in the Summary Compensation Table.

Potential Payments upon Termination or Change in Control

The Company has not entered into any Change of Control Agreements with directors or executive officers.

Director Compensation

The Committee determines the amount of Director’s compensation on an annual basis. The Committee uses available data from peer banks in determining the amount of compensation to pay. The Committee also considers the role of directors, the expected number of meetings that will occur and any other additional duties of circumstances that may require additional attention by directors or impose additional responsibilities.

Non-officer Directors were subject to a possible annual compensation of $24,700 in 2011 based on the number of Board meetings attended during the year. Directors who are members of Board committees receive a payment for each committee meeting attended.

Information related to the 2011 compensation of directors is included in the Director Compensation Table on a subsequent page. Committee and board meeting fees paid to executive board members are included in column (1) of the Directors Compensation Table.

Under Section 162(m) of the Internal Revenue Code, compensation in excess of $1 million paid to a chief executive officer or any of the four most highly compensated officers generally cannot be deducted. The committee has determined the Company’s compensation practices and policies are not currently affected by this limitation.

Compensation Committee Interlocks and Insider Participation

There are no relationships that would create a compensation committee interlock as defined under applicable SEC regulations.

COMPENSATION COMMITTEE REPORT

Annual Compensation Disclosure and Compensation Committee Certification

The Company does not encourage the Senior Executive Officer (“SEO”) to take unnecessary and excessive risks that threaten the value of the institution, does not encourage behavior focused on short-term results rather than long-term value creation, and does not encourage the manipulation of reported earnings to enhance the compensation of any employee. There are no existing employee compensation plans.

The compensation committee certifies that: (1) It has reviewed with senior risk officers the senior executive officer (SEO) compensation plans, if existing, and has made all reasonable efforts to ensure that these plans, if existing, do not encourage SEOs to take unnecessary and excessive risks that threaten the value of Security Capital Corporation.; (2) It has reviewed with senior risk officers the employee compensation plans, if existing, and has made all reasonable efforts to limit any unnecessary risks these plans, if existing, pose to Security Capital Corporation; and (3) It has reviewed the employee compensation plans, if existing, to eliminate any features of these plans, if existing, that would encourage the manipulation of reported earnings of Security Capital Corporation to enhance the compensation of any employee.

The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement. The Compensation Committee of the Company does not have a charter.

Submitted by the Compensation Committee of the Board of Directors

	John L. King, Jr.	Laney Funderburk	Tony Jones

	Joe Brown	Will Hays	Ken Murphree

		George C. Carlson

The Board of Directors has determined that the members of the Compensation Committee are independent.

SUMMARY COMPENSATION TABLE

The following table shows the compensation for 2011 for the Chief Executive Officer of the Company and the other Executive Officers of the Company and the bank whose cash compensation exceeded $100,000. There have been no stock awards or option awards to any Executive Officers or Directors of the Company.

Name and Principal Position	Year	Salary		Bonus		Other				Total

Larry Pratt	2009	$	30,000	$	-	$	648	(1	)	$	35,240
Chairman							1,306	(2	)
							2,400	(3	)
							886	(4	)
							-	(5	)

	2010		30,000		-		-	(1	)		34,883
							1,763	(2	)
							2,400	(3	)
							720	(4	)
							-	(5	)

	2011		30,000		-		-	(1	)		34,183
							1,783	(2	)
							2,400	(3	)
							-	(4	)
							-	(5	)

Frank West	2009		230,000		-		11,625	(1	)		255,409
President & CEO							9,520	(2	)
							2,688	(3	)
							1,576	(4	)
							-	(5	)

	2010		234,600		-		6,600	(1	)		258,343
							13,015	(2	)
							2,688	(3	)
							1,440	(4	)
							-	(5	)

	2011		260,000		-		7,349	(1	)		283,519
							13,482	(2	)
							2,688	(3	)
							-	(4	)
							-	(5	)

Name and Principal Position	Year	Salary		Bonus		Other				Total

William R. Fleming	2009	$	136,000	$	6,750	$	7,198	(1	)	$	156,949
EVP & Senior Trust Officer							5,801	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

	2010		138,720		12,500		4,573	(1	)		165,289
							8,296	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

	2011		147,220		13,500		4,858	(1	)		175,688
							8,910	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

Connie Hawkins	2009		135,000		6,750		6,989	(1	)		157,661
EVP, CFO & Cashier							5,922	(2	)
							-	(3	)
							-	(4	)
							3,000	(5	)

	2010		137,720		12,500		4,586	(1	)		166,125
							8,319	(2	)
							-	(3	)
							-	(4	)
							3,000	(5	)

	2011		145,700		18,500		5,178	(1	)		181,876
							9,498	(2	)
							-	(3	)
							-	(4	)
							3,000	(5	)

Jeff Herron	2009		136,000		6,000		7,448	(1	)		156,651
EVP & Loan Administrator							6,003	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

	2010		138,720		6,000		4,458	(1	)		158,465
							8,087	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

	2011		139,920		5,000		4,464	(1	)		158,773
							8,189	(2	)
							1,200	(3	)
							-	(4	)
							-	(5	)

Name and Principal Position	Year	Salary		Bonus		Other				Total

Dwayne Myers	2009	$	135,500	$	25,000	$	-	(1	)	$	163,888
EVP & Senior Loan Administrator							-	(2	)
							1,588	(3	)
							1,800	(4	)
							-	(5	)

	2010		145,000		25,000		4,534	(1	)		187,508
							9,586	(2	)
							1,588	(3	)
							1,800	(4	)
							-	(5	)

	2011		148,000		25,000		4,713	(1	)		189,322
							10,021	(2	)
							1,588	(3	)
							-	(4	)
							-	(5	)

(1)	Company Contribution to 401k plan

(2)	ESOP Allocations

(3)	Automobile Allowance

(4)	Country Club Membership Dues

(5)	Other Fees including Accounting and Consulting

OTHER POTENTIAL POST-EMPLOYMENT PAYMENTS

The Company does not use employment contracts for executives and does not have any contractual obligations for potential post employment severance payments.

DIRECTOR COMPENSATION TABLE

During 2011, each Director of Security Capital Corporation received $350.00 for each Board meeting and $500 for each Audit Committee meeting that was attended. Normally, five scheduled meeting are held each month and one scheduled meeting per quarter is held. Of the five scheduled monthly meetings, three are Loan Committee Meetings which are attended, respectively, by the members of the Desoto Loan Committee, the Tunica Loan Committee and the Batesville Loan Committee. The Trust Committee meeting and the Director’s Meeting complete the monthly meetings. The quarterly meeting is the Audit Committee Meeting. Special meetings are called as needed and the directors are reimbursed at a monthly cap of $1,050.00 (excluding fees for Audit Committee Meetings.) Based on the fee structure, a director not attending a maximum of three (3) meetings during the month would be paid by the number of meetings attended. In addition, each director that was active at year-end received an annual fee of $9,000.00 from First Security bank, $1,000.00 from Security Capital Corporation and $100.00 from Batesville Security Building Corporation. The total possible fee is contingent on the number of committees on which a director serves.

The following table shows information related to cash and other compensation paid to directors during 2011.

	Fees		Other
Name	Earned		Compensation		Total
Larry Pratt	$	22,700	$	-	$	22,700

Joe M. Brown		24,000		-		24,000

Will Hays		24,700		-		24,700

John Mothershed		10,422		-		10,422

John L. King, Jr.		22,700		-		22,700

Frank West		24,700		-		24,700

Tony Jones		22,350		-		22,350

Laney Funderburk		22,700		-		22,700

Ken Murphree		24,700		-		24,700

George C. Carlson		11,928		-		11,928

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Security Capital Corporation has had, and expects to have in the future, banking transactions in the ordinary course of its business with directors, officers and their associates. These transactions have been on substantially the same terms – including interest rates, collateral requirements, and repayment terms on extensions of credit – as those prevailing or required for an outside customer. There were no transactions over $120,000, not in the ordinary course of business.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND FEES

HORNE LLP, served as the independent registered public accounting firm for the Company to conduct the 2011 annual audit. Representatives of this firm will be present at the Annual Meeting and have an opportunity to make statements if they so desire and are expected to be available to respond to appropriate questions.

T. E. Lott & Company served as the independent registered public accounting firm for the Company for 2010 and the 2011 accounting periods preceding the 2011 annual audit services.

The following is a summary of fees related to services performed for the Company by HORNE LLP, and T. E. Lott & Company for the two years ended December 31, 2011:

	2011		2010
Audit fees

Integrated audit of the consoldiated financial statements
and internal control over financial staetment reporting,
and reviews of the Company's quarterly reports on Form 10-Q.	$	77,300	$	108,345

Audit related fees		-		-

Tax services
Preparation of federal and state tax returns		3,950		4,908
Tax consultations		-		325
Total tax services		3,950		5,233

All other fees		1,700		1,122

Total	$	82,950	$	114,700

In 2011, the Board of Directors of Security Capital Corporation ("the Company") voted to dismiss T. E. Lott & Company, P. A., and to appoint HORNE LLP as the Company's independent registered public accounting firm for the fiscal year ending December 31, 2011, and until their successors are selected. The 2010 fees reflected in the preceding table reflect fees paid to T. E. Lott & Company for their audit services and reviews for the 2010 reports and records. The 2011 fees reflect $63,000 paid to HORNE LLP for providing an audit for the 2011 year. The remainder of the 2011 fees represents fees paid to T. E. Lott & Company for reviews of the Company’s 2011 quarterly reports and preparation of an annual income tax return.

The Audit Committee has adopted pre-approval policies and procedures which are available on the Company’s website, www.firstsecuritybk.com. All of the fees set forth above were pre-approved by the Audit Committee. The Audit Committee has considered whether any provision of non-audit services is compatible with maintaining the principal auditor’s independence.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has a standing Audit Committee of its Board of Directors which met four (4) times during 2011. The members appointed to serve on the 2011 Audit Committee are Joe Brown, Will Hays, and Ken Murphree. Will Hays is designated as chairman of the committee.

Each of the members of the Audit Committee is identified as an independent director. The Company’s Board of Directors at this time has not identified an “an audit committee financial expert” as that term is defined in pertinent Securities and Exchange Commission regulations, because currently no member of the Board of Directors meets the criteria set forth in these regulations. The Audit Committee reviews audit plans, examination results of both independent and internal auditors and makes recommendations to the Board of Directors concerning independent auditors.

For 2011, the Company’s Compensation Committee was comprised of Will Hays, Tony Jones, Ken Murphree, Laney Funderburk, John L. King, Jr., Joe Brown, and George C. Carlson which reviewed and approved all officers’ salaries and compensation as needed. The agenda for the 2011 Board of Directors meeting included the appointment of members to the Compensation Committee.

The Nominating Committee members for 2011 were designated as John L. King, Jr., Tony Jones, Ken Murphree, Joe Brown, Will Hays, Laney Funderburk, and George C. Carlson. The Nomination Committee is composed of independent directors and does not have a charter. The Company’s Bylaws are silent as to nominations to the Board of Directors, other than those made by or at the direction of the Board of Directors. The Nominating Committee does not have a specific policy to consider Board diversity; however, the Committee seeks well-qualified nominees, and believes its Board represents a wide variety of backgrounds. The Nominating Committee does not accept nominations directly from shareholders.

BOARD STRUCTURE

The Board of Directors of the Company is made up of nine individuals, two of whom are insiders as executives of the Company. The seven outside directors have a wide variety of business experience and bring that experience to bear in fulfilling their duties as directors of the Company. The Chairman and Chief Executive Officer positions are held separately. The Board does not name a lead independent director but all independent directors have an equal voice in the business of the Company.

The Board of Directors has the primary responsibility of overseeing the Company’s risk management processes, including reviewing policies and procedures to identify any significant risks or exposures and determining the steps to take to monitor and minimize those risks. The Audit Committee is responsible for oversight of financial reporting risks, while the Compensation Committee is responsible for oversight of compensation-related risks.

REPORT OF THE AUDIT COMMITTEE

Notwithstanding anything to the contrary set forth in any of the Company’s filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, the following report of the Audit Committee shall not be incorporated by reference into any such filings and shall not otherwise be deemed filed under such acts.

With respect to fiscal year 2011, the Audit Committee has reviewed and discussed the audited financial statements with management. The Audit Committee has discussed with the independent auditors the matters required to be discussed by the Public Company Accounting Oversight Board (“PCAOB”) Rule 3526, “Communication with Audit Committees.” The Audit Committee received the written disclosures and the letter from the independent auditors required by PCAOB Rule 3520, Independent Discussions with Audit Committees, and has discussed with the independent auditors the auditor’s independence.

The Audit Committee has discussed with the Company’s management and independent auditors the process used for certifications by the Company’s Chief Executive Officer and Chief Financial Officer which are required by the Securities and Exchange Commission and the Sarbanes-Oxley Act of 2002 for certain of the Company’s filings with the Securities and Exchange Commission.

Based on the review and discussion referred to above, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2011 for filing with the Securities and Exchange Commission.

The Board of Directors has determined that the members of the Audit Committee are independent.

The Board of Directors adopted a written charter for the Audit Committee and is available on the company’s website, www.firstsecuritybk.com.

Submitted by the Audit Committee of the Board of Directors:

Joe Brown Will Hays Ken Murphree

OTHER MATTERS

Management at present knows of no other business to be brought before the meeting. However, if other business is properly brought before the meeting, it is the intention of the management to vote the accompanying Proxies in accordance with its judgment.

PROPOSALS FOR 2013 ANNUAL MEETING

Any shareholders who wish to present a proposal at the Company’s next Annual Meeting and who wishes to have the proposal included in the Company’s Proxy Statement and form of proxy for the meeting must submit the proposal to the undersigned at the Home Office of the Company, located at 295 Highway 6 West, Batesville, Mississippi, no later than December 20, 2012. Any submission subsequent to the aforementioned date will be considered untimely. Nominees for directors from the shareholders are subject to this deadline.

Communications from the shareholder to the Board of Directors may be submitted by mailing to P. O. Box 690, Batesville, Mississippi, or hand delivered to the Home Office of the Company, located at 295 Highway 6 West, Batesville, Mississippi.

The accompanying Proxy is solicited by Management.

BY ORDER OF THE BOARD OF DIRECTORS

Date and available at

Batesville, Mississippi

On or about March 9, 2012