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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>UNITED
      STATES</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
      AND EXCHANGE COMMISSION</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>WASHINGTON,
      D.C. 20549</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>FORM
      8-K</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CURRENT
      REPORT</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>PURSUANT
      TO SECTION 13 OR 15(d) of the</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
      EXCHANGE ACT OF 1934</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">August
      22, 2006</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Homeland
      Security Capital Corporation</u></strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
      Name of Registrant as Specified in Charter)</font><br></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>Delaware</u></strong></font></div>
            </td>
            <td width="1%" style="border-bottom: medium none;">&#160;</td>
            <td valign="bottom" width="28%" style="border-bottom: medium none;">
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            <td width="1%" style="border-bottom: medium none;">&#160;</td>
            <td valign="bottom" width="28%" style="border-bottom: medium none;">
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                or other jurisdiction</font></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Commission</font></div>
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            <td width="1%">&#160;</td>
            <td valign="bottom" width="28%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(IRS
                Employer</font></div>
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                incorporation)</font></div>
            </td>
            <td width="1%">&#160;</td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">File
                Number)</font></div>
            </td>
            <td width="1%">&#160;</td>
            <td valign="bottom" width="28%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Identification
                No.)</font></div>
            </td>
          </tr>

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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><u>4100
                North Fairfax Drive, Suite 1150, Arlington,
                Virginia</u></strong></font></div>
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            <td width="1%" style="border-bottom: medium none;">&#160;</td>
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            </td>
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          <tr>
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                of principal executive offices)</font></div>
            </td>
            <td width="1%">&#160;</td>
            <td valign="bottom" width="27%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Zip
                code)</font></div>
            </td>
          </tr>
          <tr>
            <td valign="bottom" width="61%">&#160;</td>
            <td width="1%">&#160;</td>
            <td valign="bottom" width="27%">&#160;</td>
          </tr>
          <tr>
            <td valign="bottom" width="61%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Registrant&#8217;s
                telephone number, including area code:</font></div>
            </td>
            <td width="1%">&#160;</td>
            <td valign="bottom" width="27%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(703)
                528-7073</strong></font></div>
            </td>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Former
      Name or Former Address, If Changed Since Last Report)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-FAMILY: Wingdings">o</font><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;Written
      communications pursuant to Rule 425 under the Securities Act (17 CFR
      230.425)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-FAMILY: Wingdings">o</font><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;Soliciting
      material
      pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-FAMILY: Wingdings">o</font><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;Pre-commencement
      communications pursuant to Rule 14d-2(b) under the Exchange
      Act&#160;(17&#160;CFR&#160;240.14d-2(b))</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-FAMILY: Wingdings">o</font><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;Pre-commencement
      communications pursuant to Rule 13e-4(c) under the Exchange Act&#160;
(17&#160;CFR&#160;240.13e-4(c))</font></div><br>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      August
      21, 2006, the Company entered into a Series A Convertible Preferred Stock
      Purchase Agreement (the &#8220;Purchase Agreement&#8221;) with Security Holding Corp.
      (&#8220;Security&#8221;). On August 22, 2006, pursuant to the Purchase Agreement, the
      Company purchased 3,000,000 shares of Security Series A Convertible Preferred
      Stock (the &#8220;Preferred Shares&#8221;) for an aggregate purchase price of $3,000,000
      (the &#8220;Offering&#8221;). The Company also committed to purchase an additional 2,000,000
      Preferred Shares, in one or more transactions, at a purchase price of $1.00
      per
      share at any time prior to August 21, 2008.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Each
      Preferred Share will accrue dividends cumulatively at the rate of eight percent
      (8%) per annum and is convertible into one (1) share of the Security common
      stock at any time by the Company, subject to adjustment for stock dividends,
      stock splits, and similar events. Each Preferred Share will be entitled to
      one
      vote as if converted into Security common stock. The holders of the outstanding
      Preferred Shares, as a class, so long as they maintain voting control of
      Security, will have the right to designate a majority of the board of directors
      of Security. Each Preferred Share will have a liquidation preference of $1.00
      per share plus any accrued and unpaid dividends.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Immediately
      following the Merger (described below) and the Offering, the Company will
      control 61.2% of the voting power of Security.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      foregoing description of the Purchase Agreement is qualified in its entirety
      by
      reference to the actual terms of the Purchase Agreement, a copy of which is
      attached hereto as Exhibit 10.2&#160;and is incorporated by reference herein in
      its entirety. See also the description of the Agreement and Plan of Merger
      set
      forth below.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM&#160;2.01.
      COMPLETION OF ACQUISITION.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      August
      22, 2006, Security, a subsidiary of the Company, completed its acquisition
      of
      Security Holding Enterprises, Inc., a Wisconsin corporation ("SHEI"), pursuant
      to the terms of an Agreement and Plan of Merger (the &#8220;Agreement"), dated August
      21, 2006, by and among Security, SHEI and certain other persons named therein
      (the &#8220;Sellers&#8221;). </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the Merger Agreement, SHEI merged with and into Security (the "Merger")
      with
      Security surviving the Merger. The Sellers will initially receive an aggregate
      of 2,500,000 shares of Security common stock in exchange for all of the issued
      and outstanding SHEI common stock. Of these shares, 600,000 are subject to
      the
      satisfaction of performance provisions before such shares will be released
      to
      the Sellers. In addition, in the future, the Sellers may receive up to an
      aggregate 2,500,000 shares of Security common stock if certain performance
      criteria are achieved by Security. The Sellers and certain employees may also
      individually receive up to 10,000,000 shares in the aggregate of Security common
      stock pursuant to restricted stock agreements. Receipt of this restricted stock
      is subject to the satisfaction of certain vesting requirements and performance
      provisions. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Agreement contains representations and warranties the parties made to each
      other
      as of specific dates. The assertions embodied in those representations and
      warranties were made solely for purposes of the contract between the parties
      to
      the Agreement and may be subject to important qualifications and limitations
      agreed by the parties in connection with negotiating its terms. Moreover,
      certain representations and warranties may not be accurate or complete as of
      any
      specified date because they are subject to a contractual standard of materiality
      different from those generally </font><a name="FIS_FINANCIAL_STATEMENTS_AND_EXHIBITS"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">applicable
      to shareholders or were used for the purpose of allocating risk between the
      parties rather than establishing matters as facts. For the foregoing reasons,
      you should not rely on the representations and warranties as statements of
      factual information.</font></a></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      foregoing description of the Agreement is qualified in its entirety by reference
      to the actual terms of the Agreement, a copy of which is attached hereto as
      Exhibit 10.1&#160;and is incorporated by reference herein in its
      entirety.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      8.01. OTHER EVENTS. </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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      August
      23, 2006, the Company issued a press release attached to this Current Report
      on
      Form 8-K as Exhibit 99.1 which relates to the Merger and is hereby incorporated
      by reference. </font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>ITEM
      9.01 FINANCIAL STATEMENTS AND EXHIBITS </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>)
      Financial Statements of Businesses Acquired</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">financial&#160;statements
      required by this item&#160;are not being filed herewith. To the extent
      information is required by this item, they will be filed with the Commission
      by
      amendment as soon as practicable, but no later than 71 days after the date
      on
      which this Current Report on Form 8-K is required to be filed.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Pro
      Forma Financial Information</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>pro
      forma </em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">financial
      information required by this item is not being filed herewith. To the extent
      information is required by this item, such information will be filed with the
      Commission by amendment as soon as practicable, but no later than 71 days after
      the date on which this Current Report on Form 8-K is required to be filed.
      </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(c)
      Exhibits: </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1
      Agreement and Plan of Merger, dated August 21, 2006, by and among Security
      Holding Corp., Security Holding Enterprises, Inc. and certain other persons
      named therein.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.2
      Series A Convertible Preferred Purchase Agreement, dated August 21, 2006, among
      Homeland Security Capital Corporation and Security Holding Corp.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1
      Press Release, dated August 23, 2006, announcing the acquisition of Security
      Holding Enterprises, Inc.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
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      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, the
      Registrant has duly caused this Current Report to be signed on its behalf by
      the
      undersigned hereunto duly authorized.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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            <td width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td width="49%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
          </tr>
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                24, 2006</font></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>H<font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">OMELAND</font>
                S<font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">ECURITY</font>
                C<font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">APITAL</font>
                C<font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">ORPORATION</font></strong></font></div>
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            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: "><em>/s/</em>&#160;<em>C.
              Thomas McMillen</em></font></td>
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                Thomas McMillen</font></div>
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                and Chief Executive Officer</font></div>
            </td>
          </tr>

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{"company-data": {"conformed-name": "Homeland Security Capital CORP", "cik": "0001006459", "assigned-sic": "7373", "irs-number": "522050585", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-23279", "film-number": "061060907"}, "business-address": {"street1": "146 MARYVILLE PIKE", "street2": "SUITE 201", "city": "KNOXVILLE", "state": "TN", "zip": "37920", "phone": "8655393561"}, "mail-address": {"street1": "146 MARYVILLE PIKE", "street2": "SUITE 201", "city": "KNOXVILLE", "state": "TN", "zip": "37920"}, "former-company": {"former-conformed-name": "CELERITY SYSTEMS INC", "date-changed": "19970811"}}
UNITED
      STATES
SECURITIES
      AND EXCHANGE COMMISSION
WASHINGTON,
      D.C. 20549
FORM
      8-K
CURRENT
      REPORT
PURSUANT
      TO SECTION 13 OR 15(d) of the
SECURITIES
      EXCHANGE ACT OF 1934
August
      22, 2006
Homeland
      Security Capital Corporation
(Exact
      Name of Registrant as Specified in Charter)
Delaware
814-00631
52-2050585
(State
                or other jurisdiction
(Commission
(IRS
                Employer
of
                incorporation)
File
                Number)
Identification
                No.)
4100
                North Fairfax Drive, Suite 1150, Arlington,
                Virginia
22203-1664
(Address
                of principal executive offices)
(Zip
                code)
Registrant's
                telephone number, including area code:
(703)
                528-7073
(Former
      Name or Former Address, If Changed Since Last Report)
Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions:
o
Written
      communications pursuant to Rule 425 under the Securities Act (17 CFR
      230.425)
o
Soliciting
      material
      pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement
      communications pursuant to Rule 14d-2(b) under the Exchange
      Act (17 CFR 240.14d-2(b))
o
Pre-commencement
      communications pursuant to Rule 13e-4(c) under the Exchange Act 
(17 CFR 240.13e-4(c))
ITEM
      1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On
      August
      21, 2006, the Company entered into a Series A Convertible Preferred Stock
      Purchase Agreement (the "Purchase Agreement") with Security Holding Corp.
      ("Security"). On August 22, 2006, pursuant to the Purchase Agreement, the
      Company purchased 3,000,000 shares of Security Series A Convertible Preferred
      Stock (the "Preferred Shares") for an aggregate purchase price of $3,000,000
      (the "Offering"). The Company also committed to purchase an additional 2,000,000
      Preferred Shares, in one or more transactions, at a purchase price of $1.00
      per
      share at any time prior to August 21, 2008.
Each
      Preferred Share will accrue dividends cumulatively at the rate of eight percent
      (8%) per annum and is convertible into one (1) share of the Security common
      stock at any time by the Company, subject to adjustment for stock dividends,
      stock splits, and similar events. Each Preferred Share will be entitled to
      one
      vote as if converted into Security common stock. The holders of the outstanding
      Preferred Shares, as a class, so long as they maintain voting control of
      Security, will have the right to designate a majority of the board of directors
      of Security. Each Preferred Share will have a liquidation preference of $1.00
      per share plus any accrued and unpaid dividends.
Immediately
      following the Merger (described below) and the Offering, the Company will
      control 61.2% of the voting power of Security.
The
      foregoing description of the Purchase Agreement is qualified in its entirety
      by
      reference to the actual terms of the Purchase Agreement, a copy of which is
      attached hereto as Exhibit 10.2 and is incorporated by reference herein in
      its entirety. See also the description of the Agreement and Plan of Merger
      set
      forth below.
ITEM 2.01.
      COMPLETION OF ACQUISITION.
On
      August
      22, 2006, Security, a subsidiary of the Company, completed its acquisition
      of
      Security Holding Enterprises, Inc., a Wisconsin corporation ("SHEI"), pursuant
      to the terms of an Agreement and Plan of Merger (the "Agreement"), dated August
      21, 2006, by and among Security, SHEI and certain other persons named therein
      (the "Sellers").
Pursuant
      to the Merger Agreement, SHEI merged with and into Security (the "Merger")
      with
      Security surviving the Merger. The Sellers will initially receive an aggregate
      of 2,500,000 shares of Security common stock in exchange for all of the issued
      and outstanding SHEI common stock. Of these shares, 600,000 are subject to
      the
      satisfaction of performance provisions before such shares will be released
      to
      the Sellers. In addition, in the future, the Sellers may receive up to an
      aggregate 2,500,000 shares of Security common stock if certain performance
      criteria are achieved by Security. The Sellers and certain employees may also
      individually receive up to 10,000,000 shares in the aggregate of Security common
      stock pursuant to restricted stock agreements. Receipt of this restricted stock
      is subject to the satisfaction of certain vesting requirements and performance
      provisions.
The
      Agreement contains representations and warranties the parties made to each
      other
      as of specific dates. The assertions embodied in those representations and
      warranties were made solely for purposes of the contract between the parties
      to
      the Agreement and may be subject to important qualifications and limitations
      agreed by the parties in connection with negotiating its terms. Moreover,
      certain representations and warranties may not be accurate or complete as of
      any
      specified date because they are subject to a contractual standard of materiality
      different from those generally
applicable
      to shareholders or were used for the purpose of allocating risk between the
      parties rather than establishing matters as facts. For the foregoing reasons,
      you should not rely on the representations and warranties as statements of
      factual information.
2
The
      foregoing description of the Agreement is qualified in its entirety by reference
      to the actual terms of the Agreement, a copy of which is attached hereto as
      Exhibit 10.1 and is incorporated by reference herein in its
      entirety.
ITEM
      8.01. OTHER EVENTS.
On
      August
      23, 2006, the Company issued a press release attached to this Current Report
      on
      Form 8-K as Exhibit 99.1 which relates to the Merger and is hereby incorporated
      by reference.
ITEM
      9.01 FINANCIAL STATEMENTS AND EXHIBITS
(a
)
      Financial Statements of Businesses Acquired
.
The
financial statements
      required by this item are not being filed herewith. To the extent
      information is required by this item, they will be filed with the Commission
      by
      amendment as soon as practicable, but no later than 71 days after the date
      on
      which this Current Report on Form 8-K is required to be filed.
(b)
Pro
      Forma Financial Information
The
pro
      forma
financial
      information required by this item is not being filed herewith. To the extent
      information is required by this item, such information will be filed with the
      Commission by amendment as soon as practicable, but no later than 71 days after
      the date on which this Current Report on Form 8-K is required to be filed.
(c)
      Exhibits:
10.1
      Agreement and Plan of Merger, dated August 21, 2006, by and among Security
      Holding Corp., Security Holding Enterprises, Inc. and certain other persons
      named therein.
10.2
      Series A Convertible Preferred Purchase Agreement, dated August 21, 2006, among
      Homeland Security Capital Corporation and Security Holding Corp.
99.1
      Press Release, dated August 23, 2006, announcing the acquisition of Security
      Holding Enterprises, Inc.
3
SIGNATURES
Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, the
      Registrant has duly caused this Current Report to be signed on its behalf by
      the
      undersigned hereunto duly authorized.
Date:
August
                24, 2006
H
OMELAND
S
ECURITY
C
APITAL
C
ORPORATION
By:
/s/
C.
              Thomas McMillen
Name:
C.
                Thomas McMillen
Title:
President
                and Chief Executive Officer
4