<PAGE> 1
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
SECURITY CAPITAL CORP.
- - - -------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
SECURITY CAPITAL CORP.
- - - -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
- - - --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- - - --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
- - - --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- - - --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- - - --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
- - - --------------------------------------------------------------------------------
(3) Filing party:
- - - --------------------------------------------------------------------------------
(4) Date filed:
- - - --------------------------------------------------------------------------------
<PAGE> 2
[LOGO] SECURITY
CAPITAL
CORPORATION
184 West Wisconsin Avenue
Milwaukee, Wisconsin 53203
(414) 273-8090
September 23, 1996
Dear Fellow Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
Security Capital Corporation (the "Company"), the holding company for Security
Bank S.S.B. (the "Bank"), which will be held on Wednesday, October 23, 1996, at
10:00 a.m., Milwaukee time, at the Milwaukee Hilton, 509 West Wisconsin Avenue,
Milwaukee, Wisconsin.
The attached Notice of Annual Meeting of Shareholders and Proxy Statement
describe the formal business to be conducted at the Annual Meeting. We also
have enclosed a copy of the Company's Summary Annual Report and Annual Report
on Form 10-K for the year ended June 30, 1996. Directors and officers of the
Company, as well as representatives of KPMG Peat Marwick LLP, the Company's
independent auditors, will be present at the Annual Meeting to respond to any
questions that our shareholders may have.
THE VOTE OF EVERY SHAREHOLDER IS IMPORTANT TO US. PLEASE MARK, SIGN, DATE
AND RETURN THE ENCLOSED PROXY FORM PROMPTLY IN THE POSTAGE-PAID ENVELOPE
PROVIDED, REGARDLESS OF WHETHER YOU ARE ABLE TO ATTEND THE ANNUAL MEETING IN
PERSON. IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON EVEN IF YOU
HAVE ALREADY MAILED YOUR PROXY.
On behalf of the Board of Directors and all of the employees of the
Company and the Bank, I wish to thank you for your continued support.
In all sincerity,
/s/ Wm. G. Schuett, Sr.
----------------------------
Wm. G. Schuett, Sr.
President and Chief
Executive Officer
<PAGE> 3
[LOGO] SECURITY
CAPITAL
CORPORATION
184 West Wisconsin Avenue
Milwaukee, Wisconsin 53203
(414) 273-8090
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 23, 1996
TO THE HOLDERS OF COMMON STOCK OF SECURITY CAPITAL CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Annual Meeting") of Security Capital Corporation (the "Company") will be held
on Wednesday, October 23, 1996, at 10:00 a.m., Milwaukee time, at the Milwaukee
Hilton, 509 West Wisconsin Avenue, Milwaukee, Wisconsin.
The Annual Meeting is for the purpose of considering and voting upon the
following matters, all of which are set forth more completely in the
accompanying Proxy Statement:
1. The election of three directors each for three-year terms, and
in each case until their successors are elected;
2. The ratification of the appointment of KPMG Peat Marwick LLP as
independent auditors of the Company for the fiscal year ending
June 30, 1997; and
3. Such other matters as may properly come before the Annual
Meeting or any adjournments or postponements thereof. The Board
of Directors is not aware of any other such business.
The Board of Directors has established August 30, 1996, as the record date
for the determination of shareholders entitled to notice of and to vote at the
Annual Meeting and any adjournments or postponements thereof. Only
shareholders of record as of the close of business on that date will be
entitled to vote at the Annual Meeting or any adjournments or postponements
thereof. In the event there are not sufficient votes for a quorum or to
approve or ratify any of the foregoing proposals at the time of the Annual
Meeting, the Annual Meeting may be adjourned or postponed in order to permit
further solicitation of proxies by the Company.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Roger D. Kamin
--------------------------------
Roger D. Kamin
Milwaukee, Wisconsin Senior Vice President, CFO, and
September 23, 1996 Secretary-Treasurer
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. YOUR VOTE IS
IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE MARK,
SIGN, DATE AND RETURN THE ENCLOSED PROXY FORM PROMPTLY IN THE ENVELOPE
PROVIDED.
<PAGE> 4
[LOGO] SECURITY
CAPITAL
CORPORATION
184 WEST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN 53203
(414) 273-8090
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 23, 1996
This Proxy Statement is being furnished to holders of common stock, $1.00
par value per share (the "Common Stock") of Security Capital Corporation (the
"Company") in connection with the solicitation on behalf of the Board of
Directors of the Company of proxies to be used at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held on Wednesday, October 23, 1996,
at 10:00 a.m., Milwaukee time, at the Milwaukee Hilton, 509 West Wisconsin
Avenue, Milwaukee, Wisconsin and at any adjournments or postponements thereof.
The 1996 Summary Annual Report to Shareholders and the Company's Annual
Report on Form 10-K, including the consolidated financial statements for the
fiscal year ended June 30, 1996, accompany this Proxy Statement and appointment
of proxy form (the "Proxy") which are first being mailed to shareholders on or
about September 23, 1996.
Only shareholders of record at the close of business on August 30, 1996
(the "Voting Record Date") will be entitled to vote at the Annual Meeting. On
the Voting Record Date, there were 9,239,131 shares of Common Stock outstanding
and entitled to vote, and the Company had no other class of securities
outstanding.
The presence, in person or by Proxy, of the holders of at least a majority
of the total number of shares of Common Stock entitled to vote is necessary to
constitute a quorum at the Annual Meeting. As to the election of directors,
the Proxy being provided by the Board of Directors enables a shareholder to
vote for the election of the nominees proposed by the Board, or to withhold
authority to vote for one or more of the nominees being proposed. Under the
Wisconsin Business Corporation Law, directors are elected by a plurality of
votes cast with a quorum present unless the articles of incorporation provide
otherwise. The Company's Articles of Incorporation do not provide cumulative
voting rights for the election of directors. The affirmative vote of a
majority of the total votes cast in person or by Proxy is necessary to ratify
the appointment of KPMG Peat Marwick LLP as independent auditors for the fiscal
year ending June 30, 1997. Abstentions are included in the determination of
shares present and voting for purposes of whether a quorum exists, while broker
non-votes are not. Neither abstentions nor broker non-votes are counted in
determining whether a matter has been approved. In the event there are not
sufficient votes for a quorum or to approve or ratify any proposal at the time
of the Annual Meeting, the Annual Meeting may be adjourned or postponed in
order to permit the further solicitation of proxies.
As provided in the Company's Articles of Incorporation, record holders of
Common Stock who beneficially own in excess of 10% of the outstanding shares of
Common Stock (the "10% Limit") are not entitled to any vote in respect of the
shares held in excess of the 10% Limit. A person or entity is deemed to
beneficially own shares owned by an
1
<PAGE> 5
affiliate of, as well as such persons acting in concert with, such person or
entity. The Company's Articles of Incorporation authorize the Board
(i) to make all determinations necessary to implement and apply the 10% Limit,
including determining whatever persons or entities are acting in concert, and
(ii) to demand that any person who is reasonably believed to beneficially own
stock in excess of the 10% Limit supply information to the Company to enable
the Board to implement and apply the 10% Limit.
Shareholders are requested to vote by completing the enclosed Proxy and
returning it signed and dated in the enclosed postage-paid envelope.
Shareholders are urged to mark their votes in the spaces provided on the Proxy.
Proxies solicited by the Board of Directors of the Company will be voted in
accordance with the directions given therein. Where no instructions are given,
signed proxies will be voted FOR the election of each of the nominees for
director named in this Proxy Statement and FOR the ratification of the
appointment of KPMG Peat Marwick LLP as independent auditors of the Company for
the fiscal year ending June 30, 1997. In the event other matters properly come
before the Annual Meeting or any adjournments or postponements thereof,
including, without limitation, a motion to adjourn the Annual Meeting in order
to permit further solicitation of proxies by the Company, the proxies will be
entitled to vote, as they, in their discretion, deem appropriate. Returning
your completed Proxy will not prevent you from voting in person at the Annual
Meeting should you be present and wish to do so.
Any shareholder giving a Proxy has the power to revoke it any time before
it is exercised by (i) filing with the Secretary of the Company written notice
thereof (Roger D. Kamin, Secretary, Security Capital Corporation, 184 West
Wisconsin Avenue, Milwaukee, Wisconsin 53203); (ii) submitting a duly executed
Proxy bearing a later date; or (iii) appearing at the Annual Meeting and giving
the Secretary notice of his or her intention to vote in person. If you are a
shareholder whose shares are not registered in your own name, you will need
additional documentation from your record holder to vote personally at the
Annual Meeting. Proxies solicited hereby may be exercised only at the Annual
Meeting and any adjournment or postponement thereof and will not be used for
any other meeting.
The cost of solicitation of proxies by mail on behalf of the Board of
Directors will be borne by the Company. The Company has retained Morrow &
Company, Inc., a professional proxy solicitation firm, to assist in the
solicitation of proxies. Morrow & Company will be paid a fee of $3,500, plus
reimbursement for out-of-pocket expenses. Proxies also may be solicited by
personal interview or by telephone, in addition to the use of the mail by
directors, officers and regular employees of the Company and Security Bank
S.S.B. (the "Bank"), without additional compensation therefor. The Company
also has made arrangements with brokerage firms, banks, nominees and other
fiduciaries to forward proxy solicitation materials for shares of Common Stock
held of record by the beneficial owners of such shares. The Company will
reimburse such holders for their reasonable out-of-pocket expenses.
Proxies solicited hereby will be returned to the Board of Directors, and
will be tabulated by inspectors of election designated by the Board of
Directors, who will not be employed by or a director of, the Company, or any of
its affiliates.
2
<PAGE> 6
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth the beneficial ownership of shares of
Common Stock as of the Voting Record Date by (i) each shareholder known to the
Company to beneficially own more than 5% of the shares of Common Stock
outstanding, as disclosed in certain reports regarding such ownership filed
with the Company and with the Securities and Exchange Commission (the "SEC") in
accordance with Sections 13(d) or 13(g) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), (ii) each director of the Company, (iii) each
of the executive officers of the Company appearing in the Summary Compensation
Table below, and (iv) all directors and executive officers as a group. Members
of the Board of Directors of the Company also serve as directors of the Bank.
<TABLE>
<CAPTION>
Number of Shares
Name Beneficially Owned (1) Percent of Class
- - - ------------------------------------------------- ---------------------- ----------------
<S> <C> <C>
Security Employee Stock Ownership Trust (7) . . . 605,292 6.55%
Nicholas Company, Inc. (8) . . . . . . . . . . . 570,000 6.17
Wm. G. Schuett, Sr. (2)(3)(4)(6) . . . . . . . . 428,137 4.51
Joseph F. Schoendorf, Jr. (2)(3)(4)(5)(6) . . . . 311,235 3.31
Robert A. Schaefer (2)(3)(4)(6) . . . . . . . . . 357,571 3.79
William G. Schuett, Jr. (2)(3)(4)(5)(6) . . . . . 119,457 1.29
Gustav J. Dreyer, Jr. (2) . . . . . . . . . . . . 38,629 *
Timothy C. Foote (2) . . . . . . . . . . . . . . 64,485 *
Robert J. Koehler (2) . . . . . . . . . . . . . . 31,000 *
Arthur C. Meyer (2) . . . . . . . . . . . . . . . 33,000 *
John G. Reuteman (2) . . . . . . . . . . . . . . 32,000 *
Francis J. Schmitt (2) . . . . . . . . . . . . . 28,800 *
Douglas S. Gordon (2)(3)(4)(5)(6) . . . . . . . . 55,534 *
Rick W. Hollenberg (2)(3)(5)(6) . . . . . . . . . 19,416 *
All Directors and executive officers as a
group (19 persons) (2)(3)(4)(5)(6) . . . . . . 1,818,405 17.96%
</TABLE>
- - - ---------------------
* Amount represents less than 1% of the total shares of Common Stock issued
and outstanding.
(1) Unless otherwise indicated, includes shares of Common Stock held directly
by the individuals as well as by members of such individuals' immediate family
who share the same household, shares held in trust and other indirect forms of
ownership over which shares the individuals exercise sole or shared voting
and/or investment power. Fractional shares of Common Stock held by certain
executive officers under the Security Employee Stock Ownership Plan (the
"ESOP") and the Security 401(k) Plan (the "401(k) Plan") have been rounded to
the nearest whole share.
(2) Includes shares of Common Stock which the named individuals and certain
executive officers have the right to acquire within 60 days of the Voting
Record Date pursuant to the exercise of stock options: Mr. Schuett, Sr. -
252,000; Mr. Schoendorf, Jr. - 158,000; Mr. Schaefer - 206,000; Mr. Schuett,
Jr. - 40,000; Mr. Dreyer - 28,000; Mr. Foote - 20,000; Mr. Koehler - 26,000;
Mr. Meyer - 13,000; Mr. Reuteman - 20,000; Mr. Schmitt - 26,400; Mr.
Hollenberg - 4,800; and Mr. Gordon - 24,000.
(3) Does not include options for shares of Common Stock which do not vest
within 60 days of the Voting Record Date which have been awarded to executive
officers under the Security Capital Corporation 1993 Incentive Stock Option
Plan.
(4) Includes shares of Common Stock awarded to certain executive officers
under the Security Bank Incentive Plan (the "BIP").
(5) Includes shares of Common Stock allocated to the accounts of executive
officers pursuant to elections made under the 401(k) Plan, for which such
individuals possess shared investment power and shared voting power for the
shares of Common Stock allocated to their own account, of which approximately
15,064 shares were allocated to accounts of the named executive officers in the
Summary Compensation Table as follows: Mr. Schoendorf - 7,664; Mr. Hollenberg
- - - - 4,180; and Mr. Gordon - 3,220.
(6) Includes shares of Common Stock allocated to certain executive officers
under the ESOP, for which such individuals possess shared voting power, of
which approximately 5,593 shares were allocated to the accounts of the named
executive officers in the Summary Compensation Table as follows: Mr. Schuett,
Sr. - 1,137; Mr. Schoendorf, Jr. - 1,171; Mr. Schaefer - 1,171; Mr. Hollenberg
- - - - 1,170; and Mr. Gordon - 944.
(7) Marshall & Ilsley Trust Company (the "Trustee") is the trustee for the
ESOP. The Trustee's address is 1000 N. Water Street, Milwaukee, Wisconsin
53202.
(8) Based upon Schedule 13G, dated January 26, 1996, filed with the Company
pursuant to the Exchange Act by Nicholas Company, Inc. and certain of its
affiliates. Nicholas Company, Inc. is an investment adviser registered under
the Investment Advisers Act of 1940 and is located at 700 North Water Street,
Milwaukee, Wisconsin 53202.
3
<PAGE> 7
MATTERS TO BE VOTED ON AT THE ANNUAL MEETING
MATTER 1.
ELECTION OF DIRECTORS
Pursuant to the Articles of Incorporation of the Company, at the first
Annual Meeting of Shareholders of the Company held on October 26, 1994,
directors of the Company were divided into three classes as equal in number as
possible. Directors of the first class were elected to hold office for a term
expiring at the first succeeding annual meeting, directors of the second class
were elected to hold office for a term expiring at the second succeeding annual
meeting and directors of the third class were elected to hold office for a term
expiring at the third succeeding annual meeting, and in each case until their
successors are elected and qualified. At each subsequent annual meeting of
shareholders, one class of directors are to be elected for a term of three
years. There are two family relationships among the directors and/or executive
officers of the Company. William G. Schuett, Jr., Senior Vice President,
Associate Counsel and Director of the Company and the Bank, is the son of Wm.
G. Schuett, Sr., Director, President, and Chief Executive Officer of the
Company and Director, Chairman of the Board and Chief Executive Officer of the
Bank. Robert J. Koehler, a director of the Company and the Bank, is the
brother-in-law of Joseph F. Schoendorf, Jr., Director, Chairman of the Board,
and General Counsel of the Company and Director and General Counsel of the
Bank. No person being nominated as a director is being proposed for election
pursuant to any agreement or understanding between any person and the Company.
Unless otherwise directed, each Proxy executed and returned by a
shareholder will be voted FOR the election of the nominees for director listed
below. If any person named as nominee should be unable or unwilling to stand
for election at the time of the Annual Meeting, the proxies will nominate and
vote for any replacement nominee or nominees recommended by the Board of
Directors. At this time, the Board of Directors knows of no reason why any of
the nominees listed below may not be able to serve as a director if elected.
The following table presents information concerning the nominees for
director, including tenure as a director of the Bank. All of the following
nominees have served as a director of the Company since the Company's formation
in August 1993.
<TABLE>
<CAPTION>
POSITION WITH THE COMPANY DIRECTOR
AND PRINCIPAL OCCUPATION OF THE BANK
NAME AGE DURING THE PAST FIVE YEARS SINCE
- - - --------------------- --------------- ------------------------------------- ---------------
Nominees for Director for Three-Year Term Expiring in 1999
<S> <C> <C> <C>
Robert A. Schaefer 58 Director, Executive Vice President 1973
and Chief Operating Officer of the
Company and Director, President and
Chief Operating Officer of the Bank.
Gustav J. Dreyer, Jr. 70 Director of the Company and the Bank; 1974
Appraiser with Appraisals, Inc. a
real estate appraisal and consulting
firm located in Milwaukee, WI.
Arthur C. Meyer 71 Director of the Company and the 1976
Bank; Prior to retirement, President
and Chief Executive Officer of
Pipkorn Corporation, a building
materials distributor located in
Thiensville, WI.
</TABLE>
4
<PAGE> 8
THE AFFIRMATIVE VOTE OF A PLURALITY OF THE VOTES CAST IS REQUIRED FOR THE
ELECTION OF DIRECTORS. UNLESS OTHERWISE SPECIFIED, THE SHARES OF COMMON STOCK
REPRESENTED BY THE PROXIES SOLICITED HEREBY WILL BE VOTED IN FAVOR OF THE
ELECTION OF THE ABOVE-DESCRIBED NOMINEES. THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE FOR ELECTION OF THE NOMINEES FOR DIRECTOR.
INFORMATION WITH RESPECT TO CONTINUING DIRECTORS
<TABLE>
<CAPTION>
POSITION WITH THE COMPANY DIRECTOR
AND PRINCIPAL OCCUPATION OF THE BANK
NAME AGE DURING THE PAST FIVE YEARS SINCE
- - - ------------------------- --------- ----------------------------- -----------
<S> <C> <C> <C>
DIRECTORS WHOSE TERMS EXPIRE IN 1997
------------------------------------
Joseph F. Schoendorf, Jr. 70 Director, Chairman of the 1957
Board and General Counsel of
the Company and Director and
General Counsel of the Bank.
Wm. G. Schuett, Sr. 74 Director, President and 1961
Chief Executive Officer of
the Company and Director,
Chairman of the Board and
Chief Executive Officer of
the Bank.
Francis J. Schmitt 74 Director of the Company and 1964
the Bank; Prior to
retirement, President of H.
Schmitt and Son, Inc., a
general contracting firm,
located
in Milwaukee, WI.
DIRECTORS WHOSE TERMS EXPIRE IN 1998
John G. Reuteman 74 Director of the Company and 1978
the Bank; Prior to
retirement, Vice President
of Arandell-Schmidt
Corporation, a lithographic
company, located in
Menomonee Falls, WI.
Timothy C. Foote 55 Director of the Company and 1979
the Bank; Prior to
retirement, President of
Foote & Associates, Inc., a
company that designs and
installs laboratory case
work and related equipment,
located in Thiensville, WI.
Robert J. Koehler 62 Director of the Company and 1984
the Bank; President of
Wisconsin Discount
Securities Corporation, an
investment securities
broker/dealer, located in
Milwaukee, WI.
William G. Schuett, Jr. 38 Director, Senior Vice 1984
President and Associate
Counsel of the Company and
the Bank.
</TABLE>
5
<PAGE> 9
MATTER 2.
RATIFICATION OF APPOINTMENT OF AUDITORS
The Company's independent auditors for the fiscal year ended June 30, 1996
were KPMG Peat Marwick LLP. The Board of Directors of the Company has
reappointed KPMG Peat Marwick LLP to perform the audit of the Company's
financial statements for the fiscal year ending June 30, 1997, subject to
ratification of such appointment by the shareholders of the Company.
Representatives of KPMG Peat Marwick LLP will be present at the Annual Meeting
and will be given the opportunity to make a statement, if they desire to do so,
and will be available to respond to appropriate questions from the Company's
shareholders.
UNLESS MARKED TO THE CONTRARY, SHARES OF COMMON STOCK REPRESENTED BY THE
ENCLOSED PROXY WILL BE VOTED FOR RATIFICATION OF THE APPOINTMENT OF KPMG PEAT
MARWICK LLP AS THE INDEPENDENT AUDITORS OF THE COMPANY. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP
AS THE INDEPENDENT AUDITORS OF THE COMPANY.
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Company was organized on August 16, 1993. Regular meetings of the
Board of Directors of the Company are held on at least a quarterly basis.
During the fiscal year ended June 30, 1996, the Board of Directors of the
Company held eleven meetings. No incumbent director attended fewer than 90% of
the aggregate total number of meetings of the Board of Directors held and the
total number of committee meetings on which such director served during the
fiscal year ended June 30, 1996.
The Board of Directors of the Company has standing Audit and Compensation
Committees. The Audit Committee consists of Messrs. Arthur C. Meyer, Timothy
C. Foote, John G. Reuteman and Francis J. Schmitt. The Audit Committee reviews
the scope and timing of the audit of the Company's financial statements by the
Company's independent public accountants and will review with the independent
public accountants the Company's management policies and procedures with
respect to auditing and accounting controls. The Audit Committee also will
review and evaluate the independence of the Company's auditors, and recommend
to the Board the engagement, continuation or discharge of the Company's
independent auditors. In addition, the Audit Committee will direct the
activities of the Bank's internal audit. The Company's Audit Committee met
four times during the fiscal year ended June 30, 1996.
The Compensation Committee of the Company consists of the same three
directors, Messrs. Timothy C. Foote, Arthur C. Meyer and Francis J. Schmitt, as
the Compensation Committee of the Bank, and such directors are neither officers
nor employees of the Company or the Bank ("Outside Directors"). The
Compensation Committee of the Company met three times during the fiscal year
ended June 30, 1996, to grant options under the Company's stock option plans
and review and approve the compensation programs and strategy. In July 1996,
the Compensation Committee of the Company and the Bank met to issue the Joint
Compensation Committee Report which appears in this Proxy Statement. For a
further description of the compensation policies of the Company and the Bank,
see "Compensation Committee Report."
The entire Board of Directors of the Company acted as a Nominating
Committee for the selection of nominees for directors to stand for election at
the Annual Meeting. The Board, acting as the Nominating Committee, met on July
24, 1996. The Company's Articles of Incorporation allow for shareholder
nominations of directors and require such nominations be made pursuant to
timely notice in writing to the Secretary of the Company. See "Shareholder
Proposals for the 1997 Annual Meeting."
6
<PAGE> 10
COMPENSATION COMMITTEE REPORT
COMPENSATION COMMITTEE
I. ROLL OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors of the Company
consists of the same Outside Directors, Messrs. Foote, Meyer and Schmitt, who
serve on the Compensation Committee of the Bank. All executive officer
compensation was paid by the Bank and compensation policies were determined by
the Compensation Committees of the Company and the Bank. During the fiscal
year ended June 30, 1996, the Compensation Committee of the Company met three
times to review and approve the executive compensation programs and strategy
and to grant options under the Company's stock option plans. In July 1996, the
Compensation Committee of the Company and the Bank met to issue this Joint
Compensation Committee Report. The term "Compensation Committee" used in this
report refers to the Compensation Committees of the Company and the Bank.
Decisions with respect to the compensation and benefits paid to the
Chairman of the Board, the President, the Executive Vice President, Operating
Senior Vice Presidents and any other designated executive officer of the Bank
(the "Executive Compensation Program") are made by the Compensation Committee.
It is the Compensation Committee's responsibility to ensure all components of
the Executive Compensation Program are consistent with the Board-approved
executive compensation strategy. The Compensation Committee reviews each
component of the Executive Compensation Program and recommends modifications to
existing programs, and introduces new programs for approval by the Board of
Directors of the Company and the Bank.
II. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is composed entirely of independent Outside
Directors, Messrs. Foote, Meyer and Schmitt, who are not former officers or
employees of the Company or any of its subsidiaries. There are no interlocks,
as defined under the rules and regulations of the SEC, between the Compensation
Committee and corporate affiliates of members of the Compensation Committee.
COMPENSATION COMMITTEE REPORT
Under rules established by the SEC, the Company is required to provide
certain data and information regarding the compensation and benefits provided
to the Company's Chief Executive Officer and certain other executive officers
of the Company. The rules require compensation disclosure in the form of
tables and a report by the Compensation Committee which explains the rationale
and considerations that led to fundamental compensation decisions affecting
such individuals. The Compensation Committee has prepared the following
report, at the direction and approval of the Board of Directors of the Company,
for inclusion in this Proxy Statement.
I. EXECUTIVE COMPENSATION POLICY
The primary objective of the executive compensation strategy is to
maintain an appropriate linkage between executive compensation, the Company's
financial performance and the creation of shareholder value. The principal
goals of the executive compensation strategy are to allow the Company to
attract and retain high quality executives by providing a total compensation
package which is at the higher end of the competitive business and employment
market in the relevant segment of the financial services industry, in order to
motivate executives to act in the long-term best interest of the Company and
its current shareholders. To achieve these goals, the Executive Compensation
Program provides annual incentive opportunities which reward executives for
achieving or surpassing Company goals and individual performance which
represent high levels of performance given the current business environment,
and provides long-term incentive opportunities which reward executives based
upon the level of shareholder value created over a multi-year period.
7
<PAGE> 11
The Executive Compensation Program consists of the following components:
- A total cash compensation target (base salary plus annual
incentive award) consistent with the compensation strategy for
the senior executive team;
- Base salaries which are determined by considering the
following factors: (i) the competitive business and employment
market, (ii) the executive's performance over time, and (iii) the
executive's level of experience;
- Annual incentive opportunities which are targeted above the
competitive market and which are linked to Company performance
and achievement of Company goals and objectives; and
- Long-term value creation recognized by providing significant
long-term compensation opportunities based upon Company and
individual performance over a multi-year period, consistent with
the practices of other financial institutions, including thrift
institutions which have converted from the mutual to stock form
of ownership.
The Committee adopted this executive compensation strategy after reviewing
the compensation structure as part of the conversion of the Bank from a
state-chartered mutual savings bank to a state-chartered stock savings bank and
the issuance of the Company's Common Stock (the "Conversion"), since as
executive officers of a publicly-held Company, the risks and responsibilities
of such individuals were substantially increased and the Company could
integrate stock-based incentive compensation vehicles into the Executive
Compensation Program. The Committee recognizes that the compensation strategy
will be continually responsive to shareholder interests.
The historical profit performance given the Company's high level of safety
and soundness, the executives' levels of experience, and shareholder return
since becoming a public company support the level of the senior executives'
total compensation package.
II. BASE SALARY AND TOTAL CASH COMPENSATION
In defining the executive compensation strategy in preparing to become a
public company, outside consultants were retained to review the base salary and
total annual cash compensation opportunity relative to other public financial
institutions. A review of the external competitiveness of current total annual
cash compensation levels included compensation information from public
financial institutions in the $1 to $7 billion asset range. The results of the
analysis indicated that the Company's executives are in the targeted range for
base salary and total annual cash compensation. No base salary increases have
been awarded to the senior executive team following consummation of the
Conversion on December 30, 1993, except for the promotion of Douglas S. Gordon
to Executive Vice President of the Bank with a salary increase effective
January 1, 1996. The base salary of Joseph F. Schoendorf, Jr., Chairman of the
Board and General Counsel of the Company, was reduced effective January 1, 1996
from $350,000 to $200,000 as a result of relinquishing his Chairmanship of the
Board of Directors of the Bank. He remains the Chairman of the Board of
Directors of the Company and General Counsel of both the Company and the Bank.
The Committee reviews and recommends base salary adjustments for the
senior executive team's compensation package on an annual basis. Published
compensation surveys of executive base salaries are used to review and monitor
the competitive business and employment market consisting of thrifts and
commercial banks (including the thrifts included in the SNL Thrift Index used
in the Performance Graph appearing in this Proxy Statement).
III. ANNUAL INCENTIVE PROGRAM
The Security Bank S.S.B. Annual Incentive Plan (the "Incentive Plan") was
developed to recognize and reward performance and provide a total annual cash
compensation target consistent with the executive compensation strategy. Under
the Incentive Plan, executives earn incentive compensation if the Company
achieves targets set for two performance indicators, after-tax net income and a
capital-to-asset ratio. The threshold and target levels are
derived from the Company's annual business plan and are approved by the Board
of Directors of the Company and the Bank within
8
<PAGE> 12
90 days after the beginning of each fiscal year. Incentive compensation
earned under the Incentive Plan is established as a percentage of each
officer's base salary.
If the financial performance of the Company falls below the approved
threshold level, no awards will be earned. If threshold levels of the
performance indicators are achieved (80% of annual business plan after-tax net
income and the threshold level of the Bank's capital-to-asset ratio is met),
the Incentive Plan provides for payment of incentive compensation in an amount
equal to 25% of an individual's base salary. If target levels of performance
indicators are achieved by the Company (100% of the annual business plan
after-tax net income and the threshold level of the Bank's capital to asset
ratio is met), the Incentive Plan provides for payment of incentive
compensation in an amount equal to 50% of an individual's base salary.
Incentive compensation may exceed 50% of an individual's base salary if the
Company surpasses target levels of the Incentive Plan performance indicators,
but, as a safeguard to shareholders, will not exceed 75% of an individual's
base salary when net income is greater than 120% of annual business plan
after-tax net income and the threshold level of the Bank's capital-to-asset
ratio is met. Prior to payment of incentive compensation in July of each
fiscal year, the Compensation Committee certifies that the performance
objectives of the Incentive Plan have been met.
The Compensation Committee compared the targeted performance goals for the
fiscal year ended June 30, 1996 to the year-end results. Performance on each
measure corresponds to a maximum incentive award. For the purpose of cost
containment for the third consecutive year, the Compensation Committee
recommended and the Board approved a cap on the annual incentive award at the
target performance level of 50% of base salary even though the Incentive Plan
formula warranted a higher incentive award.
IV. LONG-TERM INCENTIVE COMPENSATION
The executive team, officers and employees were awarded restricted stock
and stock options in connection with the Conversion. The Security Bank
Incentive Plan (the "BIP") was established at the time of the Conversion as a
method of providing employees and officers of the Bank with a proprietary
interest in the Company and to encourage such persons to remain with the Bank.
The Bank contributed funds to the BIP to enable it to acquire approximately 5%
of the shares of Common Stock issued in the Conversion, of which 3.96% was
granted to executive officers of the Bank during the fiscal year ended June 30,
1994. No shares were awarded under the BIP during fiscal years ended June 30,
1995 and 1996. In fiscal 1994, the Board of Directors of the Company also
adopted the Security Capital Corporation 1993 Incentive Stock Option Plan (the
"Option Plan"). All officers and employees of the Company and its subsidiaries
are eligible to participate in the Option Plan. During the fiscal year ended
June 30, 1995, Douglas S. Gordon was granted stock options to purchase 5,000
shares of Common Stock at the then-current market value of $41.50 per share.
During the fiscal years ended 1995 and 1996, no other options were awarded to
the executive officers appearing in the Summary Compensation Table in this
Proxy Statement. The BIP and the Option Plan are administered by the
Compensation Committee. The BIP and the Option Plan were provided in
recognition of the value built by the executive team and employees of the Bank
and to serve as a retention vehicle following the Conversion. These plans
replaced a long-term cash incentive plan. The Compensation Committee reviews
annually the need to develop additional long-term incentive program elements to
strengthen the relationship between Company performance and executive
compensation.
V. CHIEF EXECUTIVE OFFICER COMPENSATION
The President and Chief Executive Officer's base compensation and annual
incentive award for the fiscal year ended June 30, 1996 were consistent with
the overall executive compensation strategy. The President's base compensation
and annual incentive opportunity were determined in connection with the
competitive market comparisons previously described. The Incentive Plan
specified the identical performance measures and target performance levels
(Threshold: 25% of base salary; Target: 50% of base salary; Maximum: 75% of
base salary) for the President and Chief Executive Officer that pertain to the
entire executive team. The annual incentive award for the fiscal year ended
June 30, 1996 was capped at 50% of base salary. No increase in base
compensation was awarded to the President and Chief Executive Officer following
the Conversion on December 30, 1993 and no BIP or stock options were awarded to
him during fiscal 1996.
9
<PAGE> 13
VI. DEDUCTIBILITY OF EXECUTIVE COMPENSATION
The compensation paid under the annual and long-term compensation programs
are tied to the performance of the Company. For fiscal years beginning on or
after January 1, 1994, Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Internal Revenue Code") places a limitation of $1.0 million per
officer on the deductibility of certain elements of compensation paid to
executive officers. It is the policy of the Company and the Bank to consider
the taxation of the Company and the Bank as a factor in the development and
implementation of the Executive Compensation Program. The compensation paid is
intended to qualify for deductibility under Section 162(m) of the Internal
Revenue Code.
THE COMPENSATION COMMITTEE OF
SECURITY CAPITAL CORPORATION AND
SECURITY BANK S.S.B.
Timothy C. Foote, Chairman
Francis J. Schmitt
Arthur C. Meyer
10
<PAGE> 14
PERFORMANCE GRAPH
The following graph shows a semi-annual period comparison of the
Company's cumulative shareholder return on the Common Stock with (i) the
cumulative total return on stocks included in the National Association of
Securities Dealers, Inc. Automated Quotation ("NASDAQ") Stock Market Index (for
United States companies) and, (ii) the cumulative total return on stocks
included in the SNL Thrift Index (published by SNL Securities, Charlottesvill,
Virginia) commencing on December 30, 1993, the date the Common Stock was
issued, through June 30, 1996. The cumulative returns set forth below for each
index assume the reinvestment of dividends into additional shares of the same
class of equity securities at the frequency with which dividends were paid on
such securities during the applicable comparison period.
COMPARISON OF SEMI-ANNUAL CUMULATIVE TOTAL RETURN
AMONG THE COMPANY, NASDAQ STOCK MARKET (U.S.) INDEX
AND SNL THRIFT INDEX(1)
[LINE GRAPH]
<TABLE>
<CAPTION>
12/30/93 06/30/94 12/31/94 06/30/95 12/31/95 6/30/96
-------- -------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Company Common Stock ...... $ 100.00 $180.00 $170.00 $196.00 $ 241.65 $ 239.84
NASDAQ Stock Market ....... 100.00 91.40 97.83 122.00 138.34 156.62
SNL Thrift Index .......... 100.00 106.23 95.21 121.88 147.77 154.24
- - - ---------------
Company Common Stock
Closing Price Per Share .. $ 25.00 $ 45.00 $ 42.50 $ 49.00 $ 60.25 $ 59.50
</TABLE>
(1) Assumes $100.00 invested on December 30, 1993 (the date of the conversion
to a stock company), and all dividends reinvested through the end of the
Company's fiscal year on June 30, 1996. The Company did not pay a
dividends until November 1995. The performance graph is based upon
closing prices on the trading day specified, with the exception of the
value of the Company's Common Stock on December 30, 1993, which is based
upon the initial price of the Company's Stock of $25.00 per share.
11
<PAGE> 15
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
EXECUTIVE COMPENSATION
During the fiscal year ended June 30, 1996, the Company did not pay
separate compensation to its executive officers. Separate compensation will
not be paid to executive officers of the Company until such time as the
executive officers of the Company devote significant time to separate
management of Company affairs, which is not expected to occur until the Company
becomes actively involved in additional business beyond the Bank. The Company
is a party to the employment agreements between the Bank and those executive
officers of the Company who also serve as executive officers of the Bank. See
"-Employment Agreements." The Company may assume some portion of the Bank's
compensation obligation under the employment agreements at such time as the
executive officers of the Company devote significant time to separate
management of Company affairs.
The following table summarizes the total compensation paid by the Bank to
its Chief Executive Officer and the next four highest paid executive officers
of the Bank and its subsidiaries whose compensation, based on salary and bonus,
exceeded $100,000 during the Bank's fiscal year ended June 30, 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION (1) LONG-TERM COMPENSATION AWARDS
----------------------- -----------------------------
OTHER VALUE OF NUMBER
ANNUAL RESTRICTED OF SHARES ALL OTHER
COMPENSATION STOCK SUBJECT TO COMPENSATON
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(2) (3) AWARDS(4) OPTIONS(5) (6)
- - - --------------------------- ---- -------- ---------- ------------ ----------------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wm. G. Schuett, Sr. 1996 $675,000 $337,500 $33,679 $ ---- ---- $153,708
President, Chief Executive Officer, & 1995 675,000 337,500 44,749 ---- ---- 115,722
Director of the Company & Chairman 1994 675,000 337,500 41,211 2,875,000 280,000 101,666
of the Board, Chief Executive Officer
& Director of the Bank
Robert A. Schaefer 1996 $560,000 $280,000 $23,188 $ ---- $ ---- $145,384
Executive Vice President, Chief 1995 560,000 280,000 23,847 ---- ---- 109,568
Operating Officer & Director of the 1994 560,000 280,000 21,948 2,300,000 226,000 100,005
Company & President, Chief Oper-
ating Officer & Director of the Bank
Joseph F. Schoendorf, Jr. 1996 $275,000 $137,500 $24,267 $ ---- $ ---- $126,320
Chairman of the Board, General 1995 350,000 175,000 29,035 ---- ---- 92,146
Counsel, & Director of the Company 1994 350,000 175,000 29,373 2,300,000 226,000 80,729
& General Counsel & Director of
the Bank
Rick W. Hollenberg 1996 $175,000 $100,000 $ ---- $ ---- $ ---- $ 24,005
President, Security Financial & 1995 175,000 100,000 ---- ---- ---- 16,955
Mortgage Corporation, a subsidiary 1994 175,000 100,000 ---- ---- 8,000 13,921
of the Bank
Douglas S. Gordon 1996 $146,500 $ 73,250 $ 7,716 $ ---- $ ---- $ 36,631
Executive Vice President of the Bank 1995 118,000 59,000 5,801 --- 5,000 25,465
1994 118,000 59,000 5,240 460,000 34,000 19,104
</TABLE>
(Footnotes on the following page)
12
<PAGE> 16
(1) Includes compensation earned and deferred at the election of the
executive officers.
(2) The Annual Incentive Plan governed bonus compensation paid by the Bank
with the exception of Mr. Hollenberg who received a discretionary bonus.
See "Compensation Committee Report-Annual Incentive Program."
(3) Perquisites provided to the named executive officers by the Company did
not exceed the lesser of $50,000 or 10% of each named executive officer's
total annual salary and bonus during the fiscal years indicated, and
accordingly, are not included. Amounts shown for Messrs. Schuett, Sr.,
Schaefer, Schoendorf, Jr. and Gordon represent payments to the named
executive officers as tax liability reimbursements.
(4) Amounts shown in this column represent the value of vested and unvested
shares of Common Stock awarded under the Security Bank Incentive Plan (the
"BIP") during the fiscal year ended June 30, 1994 in connection with the
Conversion, calculated by multiplying the value of the Common Stock on the
date of grant ($25.00) by the number of shares of Common Stock awarded.
All awarded shares of the BIP plan are fully vested as of June 30, 1996.
At June 30, 1996, the value of the total vested shares awarded in fiscal
1994 to Messrs. Schuett, Sr., Schaefer, Schoendorf, Jr., and Gordon under
the BIP was $6,842,500, $5,474,000, $5,474,000 and $1,094,800,
respectively, based on 115,000, 92,000, 92,000, and 18,400 shares awarded,
respectively, and the value of the Company's Common Stock on that date
($59.50 per share).
(5) Amounts shown in this column represent the total number of shares of
Common Stock subject to options granted (both vested and invested) under
the Security Capital Corporation 1993 Incentive Stock Option Plan (the
"Option Plan").
(6) Amounts shown in this column represent the Bank's contributions on behalf
of the named executive officers under the 401(k) Plan, the ESOP, the
Security Bank S.S.B. Non-Qualified Deferred Compensation Plan (the
"Deferred Compensation Plan"), the Executive Split Dollar Life Insurance
Program (the "Split Dollar Program"), and disability insurance premiums
for the fiscal years ended June 30, 1994, 1995 and 1996. The amounts
shown for each individual for the fiscal year ended June 30, 1996 are
derived from the following figures: (i) Mr. Schuett, Sr. - $1,500 -
matching contribution under the 401(k) Plan; $21,415 - ESOP allocation;
$37,722 - above market interest, $3,386 - matching contribution and
$64,227 - ESOP allocation under the Deferred Compensation Plan; $21,033 -
payment of executive's split dollar premium cost; $3,163 - discounted
value of premium under the Split Dollar Program and $1,262 - group term
life premium; (ii) Mr. Schaefer - $1,500 - matching contribution under the
401(k) Plan; $21,435 - ESOP allocation; $29,548 - above market interest,
$3,386 - matching contribution and $64,227 - ESOP allocation under the
Deferred Compensation Plan; $8,188 - payment of executive's split dollar
premium cost and $14,292 - discounted value of premium under the Split
Dollar Program; $108 - disability premium and $2,700 - group term life
premium; (iii) Mr. Schoendorf, Jr. - $1,500 - matching contribution under
the 401(k) Plan; $21,435 - ESOP allocation; $19,877 - above market
interest, $3,386 - matching contribution and $64,227 - ESOP allocation
under the Deferred Compensation Plan; $11,660 - payment of executive's
split dollar premium cost and $2,973 - discounted value of premium under
the Split Dollar Program and $1,262 - group term life premium; (iv) Mr.
Hollenberg - $1,500 - matching contribution under the 401(k) Plan; $21,434
- ESOP allocation and $1,071 - group term life premium; (v) Mr. Gordon -
$1,331 matching contribution under the 401(k) Plan; $19,008 - ESOP
allocation; $4,098 - above market interest and $1,551 - matching
contribution and $8,435 - ESOP allocation under the Deferred Compensation
Plan; and $2,208 - group term life premium.
13
<PAGE> 17
EMPLOYMENT AGREEMENTS
In connection with the Conversion, the Bank and Company entered into
three-year employment agreements with Messrs. Joseph F. Schoendorf, Jr., Wm. G.
Schuett, Sr., Robert A. Schaefer and Douglas S. Gordon. These employment
agreements are intended to ensure that the Bank and Company maintain stable and
competent management following the Conversion. The Bank will be initially
responsible for payments under the agreements, although the Company may agree
to assume a portion of that obligation at such time as the officers devote
significant time to separate management of Company affairs.
Under these agreements, which became effective upon completion of the
Conversion, the current base salaries for Messrs. Joseph F. Schoendorf, Jr.,
Wm. G. Schuett, Sr., Robert A. Schaefer and Douglas S. Gordon are $200,000,
$675,000, $560,000, and $175,000, respectively. Base salaries may be increased
by the Bank's Board of Directors, but may not be reduced except as part of a
general pro rata reduction in compensation for all executive officers. In
addition to base salary, the agreements provide for payments from other Bank
incentive compensation plans, and provide for other benefits, including
participation in any group health, life, disability or similar insurance
program and in any pension, profit-sharing, employee stock ownership plan,
deferred compensation, 401(k) or other retirement plans maintained by the Bank.
The agreements also provide for participation in any stock-based incentive
programs made available to executive officers of the Bank. The agreements may
be terminated by the Bank upon death, disability, retirement, or for cause at
any time, or because of certain events specified by the regulations issued by
the Division of Savings Institutions ("DSI") of the Wisconsin Department of
Financial Institutions. If the Bank terminates the agreements other than for
death, disability, retirement or cause, the executive is entitled to
continuation of his compensation and benefits (based on the highest
compensation in effect within the five calendar years preceding the date of
termination) for the remainder of the employment term together with other
compensation and benefits in which he was vested at the termination date.
The agreements provide for severance payments if the executive's
employment terminates following a change in control. Under the agreements, a
"Change in Control" is generally defined to include any change in control
required to be reported under the federal securities laws as well as (i) the
acquisition by any person of 20% or more of the Company's outstanding voting
securities, or (ii) a change in a majority of the directors of the Company
during any two-year period without the approval of at least two-thirds of the
persons who were directors at the beginning of such period. Within the greater
of twelve months or the remaining employment term at the effective date of any
Change in Control, the executive has the option of receiving: (i) the amount
payable if the Bank terminated employment for reasons other than death,
disability, retirement or for cause; or (ii) severance payments based on the
average of the executive's base level compensation plus bonus over the past
five calendar years payable for the then remaining employment term (which at
the executive's election may be payable in one lump sum), but not less than
2.99 times the executive's total compensation for the preceding calendar year.
In either case, the executive is entitled to all qualified retirement and other
benefits in which the executive was vested. If the severance payments
following a Change in Control would constitute "parachute payments" within the
meaning of Section 280G(b)(2) of the Internal Revenue Code of 1986, as amended
("Internal Revenue Code"), and the present value of such "parachute payments"
equals or exceeds three times the executive's average annualized includable
income for the five calendar years preceding the year in which a Change in
Control occurred, the severance payments shall be reduced to an amount equal to
the present value of 2.99 times the average annual compensation paid to the
executive during the five calendar years immediately preceding such Change in
Control. If total payments following a Change in Control constitute excess
parachute payments under Section 280G of the Internal Revenue Code, it could
result in the imposition of an excise tax on the recipient and denial of an
income tax deduction for such excess amounts to the Bank and the Company. The
agreements provide that benefits payable to the executive under a Change in
Control may, at the election of the executive, be reduced to an amount
necessary to prevent imposition of an excise tax.
In December 1993, Security Financial and Mortgage Corporation ("SFMC"), a
subsidiary of the Bank, entered into an employment agreement with its
President, Mr. Rick W. Hollenberg, which expires June 30, 1997. The agreement
provides that SFMC may terminate Mr. Hollenberg for cause and at any time
without cause, provided that in such event SFMC shall be obligated to pay Mr.
Hollenberg severance pay equal to $100,000 for each year of the remaining term
(prorated for partial years). In addition, the agreement contains a
non-compete restriction which provides that for a period terminating upon the
earlier of (i) the second anniversary of Mr. Hollenberg's
termination date or (ii) the expiration of the employment contract, Mr.
Hollenberg shall not be employed by, control, manage or otherwise participate
in the business of a significant competitor of SFMC.
14
<PAGE> 18
BENEFITS
EXECUTIVE SPLIT DOLLAR INSURANCE PROGRAM AND SEVERANCE BENEFIT
The Bank maintains a Split Dollar Life Insurance Program (the "Split
Dollar Program"), in which Messrs. Schuett, Sr., Schaefer and Schoendorf, Jr.
participate. The life insurance benefit for each is equal to $1,000,000. The
executive pays the premium equal to the cost of term insurance (which is paid
to such executive as additional compensation) and the Bank pays the remainder
of the premium for the insurance. Upon the executive's death or termination,
the Bank will receive all premiums it paid and the executive will receive the
remainder of the death benefit or the cash surrender value under the Split
Dollar Program. Mr. Schaefer receives an additional benefit of approximately
$500,000 through a combination of split dollar life insurance and severance
payments.
PENSION PLAN
The Bank maintains the Security Employees' Pension Plan ("Pension Plan")
for the benefit of employees of the Bank and employees of the Bank's
subsidiaries with the exception of SFMC, Security Insurance and Financial
Services, Inc. ("SIFS"), Security Mortgage and Financial Services, Inc.
("SMFS"), and Security Financial and Leasing Services, Inc. ("SFLS"). The
Pension Plan is a noncontributory defined benefit pension plan. All employees
who are at least age 21 and who have completed twelve months of at least 1,000
hours of service with the Bank or a participating subsidiary are eligible to
participate in the Pension Plan. The Bank annually contributes an amount to
the Pension Plan necessary to satisfy the actuarially-determined funding
requirements in accordance with the Employee Retirement Income Security Act of
1974, as amended ("ERISA").
The Bank also maintains the Security Bank S.S.B. Supplemental Pension Plan
("Supplemental Plan"). This non-qualified plan provides the additional
benefits that would have been provided under the Pension Plan but for the
maximum annual benefit limitation of Section 415 of the Internal Revenue Code
(which was $120,000 for 1996) and the maximum annual compensation limitation in
Section 401(a)(17) of the Internal Revenue Code ($150,000 for 1996). The
Supplemental Plan provides a similar benefit structure as provided in the
Pension Plan with certain enhancements, including no adjustment for covered
compensation, accrual of benefits ratably over 20 years, unreduced early
retirement opportunity at age 62 and a five-year compensation average which was
formerly used by the Pension Plan prior to recent changes for qualification
under the Internal Revenue Code. The Supplemental Plan also provides lifetime
medical benefits. Payments under the Supplemental Plan will commence no later
than age 70 1/2 and the Bank may, in its discretion, accelerate payouts to
participants who are 70 1/2 or older.
The following table sets forth the estimated annual benefits payable under
the Pension Plan and the Supplemental Plan upon retirement at age 65 in
calendar year 1996, expressed in the form of a "single life" annuity based on
the average annual compensation and years of service classifications specified.
PENSION AND SUPPLEMENTAL PLAN TABLE
<TABLE>
<CAPTION>
AVERAGE CREDITABLE YEARS OF SERVICE AT AGE 65
ANNUAL --------------------------------------
COMPENSATION 15 20 25 30 35
------------
<S> <C> <C> <C> <C> <C>
$125,000 $ 65,625 $ 87,500 $ 87,500 $ 87,500 $ 87,500
150,000 78,750 105,000 105,000 105,000 105,000
175,000 91,875 122,500 122,500 122,500 122,500
200,000 105,000 140,000 140,000 140,000 140,000
225,000 118,125 157,500 157,500 157,500 157,500
250,000 131,250 175,000 175,000 175,000 175,000
300,000 157,500 210,000 210,000 210,000 210,000
400,000 210,000 280,000 280,000 280,000 280,000
450,000 236,250 315,000 315,000 315,000 315,000
500,000 262,500 350,000 350,000 350,000 350,000
600,000 315,000 420,000 420,000 420,000 420,000
</TABLE>
The average annual compensation covered by the Pension and Supplemental
Plans include Form W-2 compensation plus salary deferrals under the 401(k) Plan
and the pre-tax medical and dependent care plan, excluding income from grants
of restricted stock and the exercise of stock options and includes, in the
Supplemental Plan, all earned salary and bonuses
15
<PAGE> 19
regardless of when paid or deferred under non-qualified plans, up to a maximum
limit of $600,000. The above table does not include the adjustment for covered
compensation under the Pension Plan which would reduce the benefits shown by
$2,700 with 20 years or more of service. Benefits actuarially adjust after age
65. Messrs. Wm. G. Schuett, Sr., Robert A. Schaefer, Joseph F. Schoendorf, Jr.
and Douglas S. Gordon have accrued 32, 41, 21 and 14 creditable years,
respectively, under the Pension and Supplemental Plans. Mr. Hollenberg does not
participate in the Pension Plan or Supplemental Plan.
DEFERRED COMPENSATION PLANS FOR KEY EXECUTIVES AND DIRECTORS
The Bank maintains non-qualified Deferred Compensation Plans for key
executives and directors (the "Deferred Compensation Plans"). Under the
Deferred Compensation Plans, a key executive or director may elect to defer
compensation earned in any year into a subsequent year. Under the Deferred
Compensation Plans, the Bank will match contributions equal to 25% of the first
6% of compensation deferred by a key employee or director under the 401(k) Plan
and Deferred Compensation Plans, provided that matching contributions under the
401(k) Plan and Deferred Compensation Plans do not exceed $4,886 (indexed each
calendar year for inflation) in any year. The Deferred Compensation Plans also
provide for an additional contribution on behalf of eligible employees equal to
the additional benefits that would have been provided under the ESOP, but for
the maximum annual contribution limitation in Section 415 of the Internal
Revenue Code (the lesser of $30,000 or 25% of compensation for 1996) and the
maximum annual compensation limitation in Section 401(a)(17) of the Internal
Revenue Code ($150,000 for 1996). The maximum annual compensation for this
benefit is limited to $600,000. Deferrals and matching contributions under the
Deferred Compensation Plans earn interest during the period of the deferral at
the rate of interest earned on the Moody's average corporate bond index plus
300 basis points. Amounts deferred are not insured, but are held in a rabbi
trust and remain subject to the claims of the Bank's creditors until paid to
the employee. The amount of compensation deferred during the fiscal year ended
June 30, 1996 is included in the Summary Compensation Table for the Company's
Chief Executive Officer and the next four highest paid executive officers whose
compensation, based on salary and bonus, exceeded $100,000 for that same
period. The Deferred Compensation Plans were amended prior to the Conversion
to permit the Bank to satisfy a portion of its obligations by purchasing shares
of Common Stock issued in the Conversion. Prior to consummation of the
Conversion, directors and executive officers made one-time irrevocable
elections to have their benefits under the Deferred Compensation Plan based in
part upon appreciation of and dividends paid on the Common Stock.
INCENTIVE STOCK OPTION PLAN
In fiscal 1994, the Board of Directors of the Company adopted the Security
Capital Corporation 1993 Incentive Stock Option Plan (the "Option Plan"). All
officers and employees of the Company and its subsidiaries are eligible to
participate in the Option Plan. At June 30, 1996, the Company and its
subsidiaries had 1,010 eligible officers and employees. The Option Plan
authorizes the grant of (i) options to purchase shares of Common Stock intended
to qualify as incentive stock options under Section 422A of the Internal
Revenue Code ("Incentive Stock Options"), (ii) options that do not so qualify
("Non-Statutory Options"), and (iii) options which are exercisable only upon a
change in control of the Company or the Bank ("Limited Rights"). Options for a
total of 1,129,200 shares of Common Stock were made available for granting to
eligible participants under the Option Plan. As of June 30, 1996, options to
purchase 1,048,500 shares of common stock had been granted under the Incentive
Stock Option Plan and a total of 80,700 shares of Common Stock were available
for granting under the plan. There were no individual grants of stock options
under the Option Plan to any of the executive officers listed in the Summary
Compensation Table during the fiscal year ended June 30, 1996.
The following table sets forth certain information concerning the exercise
of stock options granted under the Option Plan by each of the executive
officers named in the Summary Compensation Table during the fiscal year ended
June 30, 1996 and the number and value of their unexercised stock options at
June 30, 1996.
16
<PAGE> 20
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS OPTIONS AT
ACQUIRED VALUE AT FISCAL YEAR END FISCAL YEAR END (1)
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - - ----------------------- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Wm. G. Schuett, Sr. 0 $ 0 252,000 8,000 $8,694,000 $276,000
Robert A. Schaefer 0 0 206,000 8,000 7,107,000 276,000
Joseph F. Schoendorf, Jr. 0 0 158,000 8,000 5,451,000 276,000
Rick W. Hollenberg 0 0 4,800 3,200 165,600 110,400
Douglas S. Gordon 0 0 24,000 11,000 795,000 330,000
</TABLE>
____________________
(1) The value of Unexercised In-the-Money Options is based upon the
difference between the fair market value of the securities underlying the
options ($59.50) and the exercise price of the options (between $25.00 and
$41.50) at June 30, 1996.
Incentive Stock Options granted to any person who is the beneficial owner
of more than 10% of the outstanding shares of Common Stock may be exercised
only for a period of five years following the date of grant and the exercise
price at the time of grant must be equal to at least 110% of the fair market
value of the Common Stock on the date of the grant. The Compensation Committee
determines the vesting schedule, exercise price and expiration date (but not
later than ten years from the date the option is granted) of future options
granted under the Option Plan. The exercise price can be paid in cash or
shares of Common Stock. No options may be granted under the Option Plan
following the tenth anniversary of the Option Plan. Options will be
transferable only by will or the laws of descent and distribution and, with
respect to Non-Statutory Options, to members of the optionee's family or a
trust created for the benefit of the optionee's immediate family. Except as
otherwise noted herein, the exercise price at the time of the grant of the
options will be equal to at least 100% of the fair market value of the
underlying shares of Common Stock. Under the Option Plan, the Company may
issue replacement options in exchange for previously granted Non-Statutory
Options at exercise prices that may be less than the previous exercise price,
but may not be less than 85% of the fair market value of the Common Stock on
the date such replacement options are granted. No option granted in connection
with the Option Plan is exercisable three months after the date on which the
optionee ceases to perform services for the Bank or the Company, except that in
the event of death, disability or retirement, options will be fully vested and
may be exercisable for the remainder of the option term. If an optionee ceases
to perform services for the Bank or the Company due to retirement, Incentive
Stock Options exercised more than three months following the date the optionee
ceases to perform services shall be treated as Non-Statutory Options. Options
held by employees terminated for cause will expire on the date of termination.
Termination for cause includes termination due to the intentional failure to
perform stated duties, breach of fiduciary duty involving personal dishonesty
resulting in a material loss to the Company, willful violations of law or the
entry of a final cease and desist order which results in a material loss to the
Company. Options will be immediately exercisable in the event of a change in
control. "Change in control" is defined to include the acquisition
of beneficial ownership of 20% or more of any class of equity security by a
person or group of persons acting in concert, a tender offer or exchange offer,
merger or other form of business combination, a sale of assets or a contested
election of directors which results in a change in control of a majority of the
Board of Directors of the Company.
DIRECTORS' COMPENSATION
BOARD FEES
The Board of Directors of the Company meets at least quarterly and
received a $1,000 quarterly retainer during the fiscal year ended June 30,
1996. For the year ended June 30, 1996, each member of the Board of Directors
of the Bank received a $3,000 monthly retainer and a $1,000 monthly meeting
fee. In addition, members of the Board of Directors of the Bank serving on
various committees of the Board of Directors received retainers during the
fiscal year ended June 30, 1996 as follows: (i) members of the Executive
Committee and Mortgage Review Committee received a monthly retainer
17
<PAGE> 21
of $1,200 and $700, respectively; (ii) members of the Compensation
Committee received $500 semi-annually and members of the Audit Committee
received $600 quarterly; and (iii) the Chairman of the Audit Committee also
received an additional $250 quarterly retainer. Mr. Dreyer received $2,250
quarterly as the Bank's appraisal reviewer. The members of the Executive
Committee are Messrs. Wm. G. Schuett, Sr., Joseph F. Schoendorf, Jr., Robert A.
Schaefer, William G. Schuett, Jr., Francis J. Schmitt and Timothy C. Foote.
The members of the Mortgage Review Committee are Messrs. Arthur C. Meyer,
Gustav J. Dreyer, Jr., and Francis J. Schmitt. The members of the Compensation
Committee are Messrs. Timothy C. Foote, Francis J. Schmitt and Arthur C. Meyer.
The members of the Audit Committee are Messrs. Arthur C. Meyer, John G.
Reuteman, Francis J. Schmitt and Timothy C. Foote.
In addition, Mr. Koehler receives a $700 monthly retainer fee for serving
on the Board of Directors of Security Mortgage and Financial Services. Mr.
Reuteman receives a $700 monthly retainer fee for serving on the Board of
Directors of SFMC. Mr. Meyer receives monthly retainer fees of $700 and $500
for serving on the Board of Directors of SIFS and SFLS, respectively.
STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
In fiscal 1994, the Board of Directors of the Company adopted the Security
Capital Corporation 1993 Stock Option Plan (the "Directors' Plan") for Outside
Directors of the Company. Options for a total of 168,000 shares of Common
Stock were granted to Outside Directors under the Directors' Plan, effective
December 17, 1993. During the fiscal year ended June 30, 1994, under the
Directors' Plan, the Outside Directors, Messrs. Dreyer, Jr., Foote, Koehler,
Meyer, Reuteman and Schmitt, each were granted options to purchase, at $25.00
per share, 28,000 shares of Common Stock. The Directors' Plan is
self-administered. All options granted under the Directors' Plan vested 33 %
on December 17, 1993, 33 % on December 17, 1994, and 33 % on December 17, 1995.
The options granted will expire ten years after the effective date of the
option grants (i.e., December 17, 2003).
DIRECTORS' RETIREMENT PLAN
The Bank provides a Directors' Retirement Plan to its Outside Directors.
To receive a benefit under the Directors' Retirement Plan, an Outside Director
generally must: (i) be retired from service as a Board member, (ii) be at
least 65 years of age (except when the director dies or retires because of
illness or infirmity prior to attaining the age of 65); (iii) have completed at
least five years of service on the Board as an Outside Director; and (iv) have
not been terminated for misconduct or cause. The benefit payable under the
Directors' Retirement Plan is a monthly payment equal to the Bank's monthly
director's fee payable at the time the director retires. The benefits shall be
payable to the eligible director or his or her designated beneficiary for a
period equal to the lesser of ten years or the director's period of service as
a outside director. The Directors' Retirement Plan also provides lifetime
medical benefits.
In the event of a "change of control" which results in involuntary
termination of a director within 24 months of the change in control, the
director will receive the maximum benefit provided under the Directors'
Retirement Plan regardless of age or period of service as an Outside Director.
A change of control for purposes of the Directors' Retirement Plan shall occur
if any person becomes the beneficial owner of 20% of the outstanding shares of
Common Stock of the Company.
The Directors' Retirement Plan allows the Bank to satisfy a portion of its
obligation for future benefits by purchasing shares of Common Stock issued in
the Conversion. Prior to consummation of the Conversion, certain Outside
Directors made a one-time irrevocable election to have their future benefits
under the Directors' Retirement Plan based in part on the value of, and
dividends on, Common Stock issued in the Conversion. A rabbi trust was
established to hold the assets.
18
<PAGE> 22
INDEBTEDNESS OF MANAGEMENT AND CERTAIN TRANSACTIONS
Current federal law requires that all loans or extensions of credit to
officers and directors must be made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with the general public and must not involve more than the normal
risk of repayment or present other unfavorable features. In addition, loans
made to a director or executive officer in excess of the greater of $25,000 or
5% of the Bank's capital and surplus (up to a maximum of $500,000) must be
approved in advance by a majority of the disinterested members of the Board of
Directors.
The Bank's policy provides that all loans or extensions of credit to
executive officers and directors are to be made in the ordinary course of
business, on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
other persons, and may not involve more than the normal risk of collectibility
or present other unfavorable features. All loans since enactment of the
current laws were made by the Bank in the ordinary course of business and were
not made with favorable terms nor involved more than the normal risk of
collectibility or presented unfavorable features.
The following table summarizes loans made by the Bank on preferential
terms to executive officers, directors and their associates, prior to the
enactment of current laws, whose aggregate indebtedness to the Bank exceeded
$60,000 at any time since July 1, 1995. All loans or extensions of credit to
executive officers and directors and their associates were current as of June
30, 1996.
<TABLE>
<CAPTION>
LARGEST AMOUNT
OUTSTANDING DURING
MATURITY THE YEAR ENDED BALANCE AT INTEREST
NAME/POSITION DATE OF LOAN DATE JUNE 30, 1996 JUNE 30, 1996 RATE/TYPE
------------- ------------ -------- ------------------ ------------- ---------
<S> <C> <C> <C> <C> <C>
Wm. G. Schuett, Sr. 03/30/72 03/01/02 $42,933 $36,637 5.75%
Chairman of the Mortgage
Board, Chief 07/07/81 07/01/11 63,270 60,785 5.75%
Executive Officer & Mortgage
Director
Arthur C. Meyer 02/25/86 03/01/16 $262,520 $255,845 6.25%
Director Adj. Rate
Mortgage
Thomas K. Anderson 08/06/82 08/01/12 $61,349 $ 58,970 5.75%
Senior Vice Mortgage
President
Dennis N. Korsmo 10/16/87 11/01/17 $72,659 $ 70,982 6.00%
Senior Vice Adj. Rate
President Mortgage
William P. Kauper, Jr. 01/31/89 02/01/19 $101,075 $ 98,782 6.00%
Senior Vice Adj. Rate
President Mortgage
</TABLE>
19
<PAGE> 23
The Company and the Bank intend that all loans or extensions of credit in
the future between the Company and the Bank and executive officers, directors,
holders of 10% or more of the shares of any class of Common Stock of the
Company and affiliates thereof, will contain terms no less favorable to the
Company or the Bank than could have been obtained by them in arms' length
negotiations with unaffiliated persons and will be reported and approved, when
required, by a majority of the disinterested members of the Board of Directors
of the Company or the Bank.
Mr. Gustav J. Dreyer is a principal shareholder and President of
Appraisals, Inc., an appraisal services and consulting firm. The Bank engages
Appraisals, Inc., as well as other appraisal firms, for services in connection
with appraisals of real estate securing loans made by the Bank. During the
fiscal year ended June 30, 1996, Appraisals, Inc. was paid an aggregate fee of
$116,350 for such appraisal services which amounts are charged to the borrower
at closing.
The Company has entered into a settlement agreement with plaintiffs who
filed a purported class action lawsuit against the Company, the Bank and
members of the Boards of Directors of the Company and the Bank. The settlement
agreement received preliminary Court approval on July 30, 1996, with the Court
also at that time certifying the plaintiff class solely for purposes of the
settlement and ordering that notice be mailed to all class members. The
pending settlement remains subject to Court approval following a hearing, which
is presently scheduled to be held on October 8, 1996. The action was filed in
Cook County, Illinois in 1994 by two Illinois residents seeking to act as named
plaintiffs for a plaintiff class and alleging fraud, misrepresentation and
breach of fiduciary duties in connection with the Bank's 1992 charter
conversion, the Bank's 1993 mutual to stock conversion and the Company's 1994
proxy solicitation. Plaintiffs alleged that the purported class of depositors
were prevented by the acts complained of from receiving all of the stock they
subscribed for in the 1993 public offering. The defendants have vigorously
contested the charges and the pending settlement agreement recognizes that
defendants deny any wrong doing or liability. If the court approves the
settlement, a $12.0 million settlement fund established by or on behalf of the
defendants will be divided (net of attorneys' fees and administrative expenses)
among participating members of the class pursuant to the settlement agreement.
The financial statement effects of the pending settlement have been taken for
the fiscal year ended June 30, 1996. Due to legal-related expense provisions
taken in prior periods and $6.0 million dollars in insurance coverage, the
impact of the pending settlement on net income for the fiscal year ended June
30, 1996 was $2.7 million after tax or $28 cents per share.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than ten percent of the shares of Common
Stock outstanding, to file reports of ownership and changes in ownership with
the SEC and the National Association of Securities Dealers, Inc. Officers,
directors and greater than ten percent shareholders are required by regulation
to furnish the Company with copies of all Section 16(a) forms they file. Based
upon review of the information provided to the Company, the Company believes
that during the fiscal year ended June 30, 1996, officers, directors and
greater than ten percent shareholders complied with all Section 16(a) filing
requirements.
SHAREHOLDER PROPOSALS FOR THE 1997 ANNUAL MEETING
Any proposal which a shareholder wishes to have included in the proxy
materials of the Company relating to the fourth annual meeting of the
shareholders of the Company, which is scheduled to be held in October 1997,
must be received at the principal executive offices of the Company, 184 West
Wisconsin Avenue, Milwaukee, Wisconsin, 53203, Attention: Roger D. Kamin,
Secretary, no later than May 29, 1997. If such proposal is in compliance with
all of the requirements of Rule 14a-8 under the Exchange Act, it will be
included in the proxy statement and set forth on the form of proxy issued for
such annual meeting of shareholders. It is urged that any such proposals be
sent certified mail, return receipt requested.
Nothing in this section shall be deemed to require the Company to include
in its proxy statement and proxy relating to the 1997 Annual Meeting any
shareholder proposal which does not meet all of the requirements for inclusion
established by the SEC in effect at the time such proposal is received.
20
<PAGE> 24
Shareholder proposals which are not submitted for inclusion in the
Company's proxy materials pursuant to Rule 14a-8 under the Exchange Act may be
brought before an annual meeting pursuant to Article VII of the Company's
Articles of Incorporation. For business to be properly brought before an
annual meeting by a shareholder, the shareholder must have given timely notice
thereof in writing to the Secretary of the Company. To be timely, a
shareholder's notice must be delivered or mailed by first class United States
mail, postage prepaid, to the principal executive offices of the Company not
later than the close of business on the tenth day following the day on which
notice of such annual meeting is first given to shareholders. A shareholder's
notice must set forth certain information in accordance with Article VII of the
Company's Articles of Incorporation. The notice must include the shareholder's
name and address, as they appear on the Company's record of shareholders, the
class and number of shares of the Company's Common Stock beneficially owned by
such shareholder, a brief description of the proposed business, the reason for
considering such business at the annual meeting and any material interest of
the shareholder in the proposed business. In the case of nominations for
elections to the Board of Directors, certain information regarding the nominee
must be provided.
OTHER MATTERS WHICH MAY PROPERLY
COME BEFORE THE ANNUAL MEETING
The Board of Directors knows of no business which will be presented for
consideration at the Annual Meeting other than as stated in the Notice of
Annual Meeting of Shareholders. If, however, other matters are properly
brought before the Annual Meeting or any adjournments or postponements thereof,
it is the intention of the persons named in the accompanying Proxy to vote the
shares represented thereby on such matters in accordance with their best
judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Roger D. Kamin
-----------------------------
Roger D. Kamin
Senior Vice President, CFO &
Secretary-Treasurer
Milwaukee, Wisconsin
September 23, 1996
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO MARK, SIGN,
DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE.
21
<PAGE> 25
SECURITY CAPITAL CORPORATION - ANNUAL MEETING - OCTOBER 23, 1996
This proxy appointment is solicited on behalf of the Board of Directors.
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting of Shareholders (the "Annual Meeting") and the Proxy Statement and,
revoking any proxy heretofore given, hereby constitutes and appoints Timothy C.
Foote and Robert J. Koehler, directors of Security Capital Corporation (the
"Company"), or any successors in their respective positions, to represent and
to vote, as designated below, all the shares of common stock, $1.00 par value
per share ("Common Stock") of the Company held of record by the undersigned on
August 30, 1996, at the Annual Meeting which will be held on October 23, 1996,
at 10:00 a.m., Milwaukee time, at the Milwaukee Hilton, 509 West Wisconsin
Avenue, Milwaukee, Wisconsin or any adjournments or postponements thereof as
follows:
1. ELECTION OF DIRECTORS
(mark one)
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as indicated to vote for all
to the contrary below) nominees listed below
ROBERT A. SCHAEFER, GUSTAV J. DREYER, JR., ARTHUR C. MEYER
(INSTRUCTION: To withhold authority to vote for any individual nominee, print
that nominee's name on the line provided below.)
-------------------------------------------------------------------------
/ /
-------------------------------------------------------------------------
2. RATIFICATION OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT
AUDITORS OF THE COMPANY FOR THE FISCAL YEAR ENDING JUNE 30, 1997.
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting, or any adjournments or
postponements thereof.
THIS PROXY IS REVOCABLE AND WILL BE VOTED AS DIRECTED, BUT IF NO
INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE MATTERS
LISTED. If any other business is presented at the Annual Meeting, this proxy
will be voted by the Board of Directors of the Company in their best judgment.
At the present time, the Board of Directors of the Company knows of no other
business to be presented at the Annual Meeting.
------------------------------- ---------------------------------------
Signature Signature if held jointly
DATED: , 1996 IMPORTANT: Please sign your name exactly
--------------------- as it appears hereon. When signing as
an attorney, administrator, agent,
corporation, officer, executor, trustee,
guardian or similar position, please add
your full title to your signature. If
shares of Common Stock are held jointly,
each holder may sign but only one
signature is required.
/ / Please check box if you plan to attend
the meeting in person.
Important: Please mark, sign, date and promptly return this proxy in the
enclosed postage-paid envelope.
