GOLDEN ISLES FINANCIAL HOLDINGS INC, DEFC14A, 1997-02-11

GOLDEN ISLES FINANCIAL HOLDINGS INC
DEFC14A, 1997-02-11
NATIONAL COMMERCIAL BANKS

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<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 [ ]

Filed by a Party other than the Registrant [X]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] 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
</TABLE>

GOLDEN ISLES FINANCIAL HOLDINGS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

Gregory S. Junkin, Paul D. Lockyer, Scott A. Junkin
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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:

(5) Total fee paid:

[ ] Fee paid previously with preliminary materials:

[ ] 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

FEBRUARY 11, 1997

PROXY STATEMENT OF
GREGORY S. JUNKIN
PAUL D. LOCKYER
SCOTT A. JUNKIN

SPECIAL MEETING OF SHAREHOLDERS

GOLDEN ISLES FINANCIAL HOLDINGS, INC.

This Proxy Statement is being furnished to holders of the common stock, no
par value ("Shares"), of Golden Isles Financial Holdings, Inc., a Georgia
corporation (the "Company"), who were holders of record as of the close of
business on January 29, 1997 (the "Record Date"). See "PROXY
PROCEDURES -- Record Date."

This Proxy Statement and the enclosed GREEN proxy card are first being
furnished by Gregory S. Junkin ("Mr. Junkin"), Paul D. Lockyer ("Mr. Lockyer")
and Scott A. Junkin ("Mr. Scott Junkin"; Mr. Junkin, Mr. Lockyer and Mr. Scott
Junkin are referred to herein collectively as the "Requesting Parties"), to
holders of Shares as of the Record Date (the "Record Holders") on or about
February 11, 1997 in connection with the solicitation of proxies (the "Proxies")
by the Requesting Parties to be used at the special meeting (the "Special
Meeting") of the shareholders of the Company scheduled for March 11, 1997 at the
Embassy Suites Hotel at 10 a.m. at 500 Mall Boulevard, Brunswick, Georgia 31525
or any adjournments or postponements of that meeting. The Special Meeting was
called pursuant to Article 2, Section 2.4 of the Bylaws of the Company (the
"Bylaws") at the request of more than 25% of the holders of the Shares for the
purpose of considering and voting on alternate sets of proposals of the
Requesting Parties described below under the heading "THE SPECIAL MEETING
PROPOSALS" (the "Special Meeting Proposals"). THE HOLDERS OF MORE THAN 29% OF
THE OUTSTANDING SHARES DELIVERED TO THE REQUESTING PARTIES REQUESTS FOR THE CALL
OF THE SPECIAL MEETING.

The Requesting Parties are soliciting your Proxy in favor of both sets of
Special Meeting Proposals that the Requesting Parties plan to introduce
alternatively at the Special Meeting, either of which, if approved, would result
in the placement on the Company's Board of Directors (the "Board") of a number
of nominees of the Requesting Parties such that a majority of the Board would
consist of directors who are committed, subject to their fiduciary duties, to a
business plan for the Company which, consistent with the Requesting Parties'
understanding of the historical purpose of the Company, would permit the Company
to become a diversified financial services company operating in Georgia, other
sections of the Southeast and in other geographic areas offering attractive
opportunities.

IMPORTANT

The approval of the first set of proposals ("Proposal A") of the Requesting
Parties in its entirety -- to decrease the size of the Board, remove certain of
the incumbent members of the Board (the "Opposing Members") and elect two
nominees of the Requesting Parties -- requires the affirmative vote of not less
than two-thirds of the outstanding Shares because a vote of two-thirds of the
outstanding Shares is required to remove a director. BECAUSE THE APPROVAL OF
PROPOSAL A IN ITS ENTIRETY REQUIRES THE VOTE OF TWO-THIRDS OF THE OUTSTANDING
SHARES, IF YOU DO NOT VOTE OR IF YOU ABSTAIN FROM VOTING ON PROPOSAL A, IT WILL
HAVE THE SAME EFFECT AS VOTING AGAINST PROPOSAL A. The second set of proposals
("Proposal B") to be presented by the Requesting Parties -- to increase the size
of the Board and elect five nominees of the Requesting Parties --

<PAGE> 3

requires the affirmative vote of a majority of the votes cast on the matter,
assuming a quorum is present. PROPOSAL B WILL ONLY BE PROPOSED IF PROPOSAL A IS
NOT APPROVED. BECAUSE THERE CAN BE NO ASSURANCE THAT PROPOSAL A WILL BE
APPROVED, IT IS IMPORTANT THAT YOU VOTE ON BOTH PROPOSALS A AND B.

THE REQUESTING PARTIES URGE YOU TO SIGN, DATE AND RETURN THE ENCLOSED GREEN
PROXY CARD TO VOTE TO PLACE ON THE BOARD A MAJORITY OF DIRECTORS COMMITTED TO
CAUSING THE COMPANY TO BECOME A DIVERSIFIED FINANCIAL SERVICES COMPANY
CONSISTENT WITH THE REQUESTING PARTIES' UNDERSTANDING OF THE HISTORICAL PURPOSE
OF THE COMPANY.

THE REQUESTING PARTIES URGE YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY
THE COMPANY. IF YOU HAVE ALREADY DONE SO, YOU MAY REVOKE YOUR PROXY BY
DELIVERING A WRITTEN NOTICE OF REVOCATION OR A LATER-DATED PROXY FOR THE SPECIAL
MEETING PROPOSALS TO MR. JUNKIN, AT THE ADDRESS INDICATED ON THE ENCLOSED
POSTAGE PRE-PAID ENVELOPE, OR BY VOTING IN PERSON AT THE SPECIAL MEETING. SEE
"PROXY PROCEDURES" BELOW.

The Requesting Parties, two of whom (Mr. Junkin and Mr. Lockyer) currently
serve as members of the Board, believe that the approval of the Special Meeting
Proposals is necessary to prevent the other directors of the Company, who have
control of the existing Board and have appointed Mr. J. Thomas Whelchel as
interim chairman (the "Whelchel Group"), from taking, over the dissenting votes
of Mr. Junkin and Mr. Lockyer, further action to limit the Company's scope of
operations in opposition to the Requesting Parties' view of the historical
purpose of the Company. See "BACKGROUND OF THE CALL OF THE SPECIAL MEETING AND
THIS PROXY SOLICITATION."

According to the Bylaws, the chairman of the Special Meeting, who serves as
the presiding officer of the meeting, may be the Chairman of the Board, or in
his absence, the President of the Company, or, alternatively, may be any other
person elected by a majority vote of the Shares represented at the Special
Meeting. THE REQUESTING PARTIES URGE YOU TO MARK THE ENCLOSED GREEN PROXY CARD
TO VOTE FOR THE ELECTION OF MR. JUNKIN OR, IN HIS ABSENCE, MR. LOCKYER AS THE
CHAIRMAN OF THE SPECIAL MEETING.

Questions and requests for assistance in completing or delivering proxy
cards may be directed to Mr. Junkin or Mr. Lockyer at the following addresses
and telephone numbers:

<TABLE>
<S> <C>
Gregory S. Junkin Paul D. Lockyer
P.O. Box 30297 311 Dunbarton Drive
Sea Island, Georgia 31561 St. Simons Island, Georgia 31522
(912) 638-4447 (912) 638-2381
</TABLE>

Carefully review the Proxy Statement and the enclosed materials. YOUR PROXY
IS IMPORTANT. IF YOU ARE UNABLE TO ATTEND THE SPECIAL MEETING IN PERSON YOUR
PROXY IS THE ONLY MEANS AVAILABLE FOR YOU TO VOTE. No matter how many or how few
shares you own, please vote FOR the Special Meeting Proposals by so indicating
and by signing, marking, dating and mailing the enclosed GREEN proxy card
promptly.

THE SPECIAL MEETING PROPOSALS

At the Special Meeting, the Requesting Parties intend to present the Special
Meeting Proposals for approval of the shareholders of the Company. IF PROPOSAL A
IS NOT ADOPTED IN ITS ENTIRETY, THE REQUESTING PARTIES WILL PROPOSE PROPOSAL B,
AS SET FORTH BELOW.

Proposal A:

(i) that the number of members constituting the full Board be fixed at
six (a decrease of two members);

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(ii) that each of J. Thomas Whelchel, Michael D. Hodges, C. Kermit
Keenum and L. McRee Harden be removed as members of the Board;

(iii) that Article 3, Section 3.6 of the Bylaws be amended to clarify
that the shareholders of the Company shall have the right to fill a vacancy
on the Board (created by the removal of a director) at a special meeting or
an annual meeting by inserting the following sentence at the end of Section
3.6:

A vacancy occurring in the Board of Directors through removal of a
director may be filled for the unexpired term and until the shareholders
have elected a successor by resolution of the shareholders at any annual
or special meeting of the shareholders.

(iv) that the two nominees of the Requesting Parties designated herein
as the "Proposal A Nominees" be elected to fill the two vacancies on the Board.

Proposal B:

(i) that the number of members constituting the full Board be fixed at
13 (an increase of five members); and

(ii) that the five nominees of the Requesting Parties designated
herein as the "Proposal B Nominees" be elected to fill the five vacancies
on the Board resulting from the increase in the number of directors.

The Special Meeting Proposals are intended to prevent the Whelchel Group
from taking further actions to limit the Company's scope of operation in
opposition to the Requesting Parties' understanding of the historical purpose of
the Company to become a diversified financial services company. The purpose of
changing the size of the Board and filling the vacancies created either by the
removal of existing members of the Board or the increase in the size of the
Board with the Proposal A Nominees or the Proposal B Nominees (the "Requesting
Parties' Nominees") is to place on the Board directors who, subject to their
fiduciary duties, are committed, as are Mr. Junkin and Mr. Lockyer, to a
business plan for the Company which, consistent with the Requesting Parties'
understanding of the historical purpose of the Company, would permit the Company
to become a diversified financial services company operating in Georgia, other
sections of the Southeast and in other geographic areas offering attractive
opportunities.

The Requesting Parties believe that Proposal A will most effectively
accomplish these goals. If Proposal A is not approved by the required vote,
Proposal B will be proposed. The Requesting Parties have included Proposal B
because it requires fewer affirmative votes of shareholders and is therefore
more likely to be approved. See the discussion of voting requirements above
under the caption "IMPORTANT." The Requesting Parties believe that Proposal B
will also effectively address the goals outlined above. To express your support
for the achievement of the Requesting Parties' goals, it is important that you
vote FOR both Proposal A AND Proposal B.

Based on currently available public information, a quorum shall be deemed
constituted at the Special Meeting if holders of not less than one-third of the
shares of Common Stock outstanding and entitled to vote at the Special Meeting
are present in person or by proxy. If a quorum is present at the Special
Meeting, the shareholders of the Company may remove members of the Board by a
vote of two-thirds of the shares of Common Stock entitled to vote in an election
of directors and they may amend the Bylaws by a vote of a majority of all shares
entitled to elect directors. The shareholders may fix the number of directors
constituting the full Board (which must be at least 3 and not greater than 25)
and elect new directors to fill newly created vacancies by a vote of a majority
of the shares of the Common Stock represented by holders present at the meeting
in person or by proxy. Once elected to the Board, each director shall serve
until the annual meeting and thereafter until his or her successor shall have
been elected and qualified or until his or her earlier death, resignation,
retirement, disqualification or removal. With respect to abstentions and broker
non-votes, the Shares will be considered present at the Special Meeting, but
since they are not affirmative votes for the Special Meeting Proposals, they
will have the same effect as votes against the Special Meeting Proposals.

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<PAGE> 5

THE REQUESTING PARTIES STRONGLY URGE YOU TO SIGN, DATE AND RETURN THE
ENCLOSED GREEN PROXY CARD AT THE ADDRESS INDICATED ON THE ENCLOSED POSTAGE
PRE-PAID ENVELOPE IN ORDER TO VOTE IN FAVOR OF THE SPECIAL MEETING PROPOSALS.

With respect to Proposal A, you also may vote FOR removal of less than all
of the Opposing Members and/or the election of less than all of the Proposal A
Nominees proposed to replace them by marking the "FOR" box and writing the
name(s) of the person(s) whom you do not wish to be removed and the name(s) of
the person(s) whom you do not wish to be elected in the space provided on the
GREEN proxy cards. If no marking is made, you will be deemed to have given a
direction to vote the Shares represented by each GREEN proxy card at the Special
Meeting FOR removal of all the Opposing Members and the election of all the
Proposal A Nominees proposed to replace them at the Special Meeting.

With respect to Proposal B, you also may vote FOR the election of less than
all of the Proposal B Nominees by marking the "FOR" box and writing the name(s)
of the person(s) whom you do not wish to be elected in the space provided on the
GREEN proxy cards. If no marking is made, you will be deemed to have given a
direction to vote the Shares represented by each GREEN proxy card at the Special
Meeting FOR the election of all the Proposal B Nominees.

Please be aware that a vote against the Special Meeting Proposals to fix
the size of the Board, either in Proposal A or Proposal B, could have the effect
of defeating Proposal A or Proposal B, respectively.

ELECTION OF DIRECTORS

According to publicly available information, the Company currently has
eight Directors, all of whose terms will expire at the Annual Meeting of
Shareholders of the Company (the "1997 Annual Meeting"), which is to be held in
May 1997.

Each Requesting Parties' Nominee, if elected, would hold office until the
1997 Annual Meeting and until a successor has been elected and qualified or
until his earlier death, resignation or removal. Although the Requesting Parties
have no reason to believe that any of the Requesting Parties' Nominees will be
unable to serve as directors, if any one or more of the Requesting Parties'
Nominees is not available for election, the persons named as proxies on the
GREEN proxy card will vote for the election of such other nominees as may be
proposed by the Requesting Parties. Should the Board purport to increase the
number of directors to be elected at the Special Meeting, it is the current
intention of the Requesting Parties to propose additional nominees for such
directorships. Each of the Requesting Parties' Nominees has consented to serve
as a director of the Company, if elected.

PROPOSAL A

Under Proposal A, the Requesting Parties propose that, at the Special
Meeting, the shareholders remove the Opposing Members (Messrs. J. Thomas
Whelchel, Michael D. Hodges, C. Kermit Keenum and L. McRee Harden) from the
Board, reduce the size of the full Board from eight to six and elect the two
Proposal A Nominees named below as directors of the Company to fill the
vacancies created by the removal of such incumbent directors. The terms of the
Opposing Members expire at the 1997 Annual Meeting. However, there can be no
assurance that prior to the Special Meeting one or more of the Opposing Members
will not have ceased to be a director (by reason of resignation or otherwise)
and have been succeeded by another person appointed by the incumbent directors
or that the number of directors on the Company's Board will not have been
increased. Accordingly, the GREEN proxy card which is solicited hereby provides
for the removal as directors of the Opposing Members and all other persons who
are serving as directors at the time that the removal becomes effective, other
than Mr. Junkin, Mr. Lockyer, Mr. Russell C. Jacobs, Jr. and Mr. Jimmy D. Veal.

If the Opposing Members were removed and all Proposal A Nominees were
elected, the Proposal A Nominees, together with Mr. Junkin and Mr. Lockyer who
already serve as directors, would constitute four of

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the possible six members of the Board. The Proposal A Nominees are listed below
and have furnished the following information concerning their principal
occupations or employment and certain other matters.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
NAME, AGE AND PRINCIPAL BUSINESS ADDRESS DURING LAST FIVE YEARS; CURRENT DIRECTORSHIPS
---------------------------------------- ---------------------------------------------
<S> <C>
Richard S. Holson, Jr. (70)............... Chairman of the Board and Chief Executive Officer
Guarantee Trust Life Insurance Co. (January 1991-present) of Guarantee Trust Life Insurance
1275 Milwaukee Avenue Company; Limited Partner and Chief of Operations (July
Glenview, Illinois 60025 1979-present) of Independence Realty Development
Company; President (March 1979-present), Independence
Director, Inc. (sales and advertising); President (May
1973-present) of Guarantee Security Life Insurance
Company of Arizona; Chairman of the Board (December
1988-present) and Director, Independence Holding
(holding company); Director of Independence Director,
Inc. and United National Life Insurance Company of
America and Boatmen's Bancshares, Inc. (March 1986-April
1990) and General Bancshares Corporation (May 1985-March
1986).
James M. Showalter (39)................... President and Chief Executive Officer (June
1 Joe Frank Harris Boulevard 1990-present) of International Auto Processing, Inc.
Colonel's Island (automotive services); Director of International Auto
Brunswick, Georgia 31521 Processing, Inc.
</TABLE>

THE REQUESTING PARTIES STRONGLY RECOMMEND A VOTE FOR THE REMOVAL OF THE
OPPOSING MEMBERS AND THE ELECTION OF THE PROPOSAL A NOMINEES.

PROPOSAL B

If Proposal A is not adopted in its entirety, the Requesting Parties will
propose Proposal B to the shareholders.

If all Proposal B Nominees were elected, the Proposal B Nominees, together
with Mr. Junkin and Mr. Lockyer who already serve as directors, would constitute
seven of the possible thirteen members of the Board. The Proposal B Nominees are
listed below and have furnished the following information concerning their
principal occupations or employment and certain other matters.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
NAME, AGE AND PRINCIPAL BUSINESS ADDRESS DURING LAST FIVE YEARS; CURRENT DIRECTORSHIPS
---------------------------------------- ---------------------------------------------
<S> <C>
Edward V. Baich (61)...................... President and Chief Executive Officer (May 1984-present)
Royal Ten Cate (USA), Inc. of Royal Ten Cate (USA), Inc. (manufacture and sale of
3500 Parkway Lane, Suite 500 geotechnical products for the agriculture, horticulture,
Norcross, Georgia 30092 industrial and construction industries); Director of
Royal Ten Cate (USA), Inc. and Gemini Precision Products
Company (manufacturer of specialty products for the gift
market).
John M. Froehlich, CPA (54)............... Vice President (July 1989-present) and Chief Financial
Chatwins Group, Inc. Officer and Treasurer (April 1988-present) of Chatwins
300 Weyman Plaza, Suite 340 Group, Inc. (design, manufacture and marketing of
Pittsburgh, PA 15236 fabricated and machined industrial parts and products).
Frank J. Guzikowski (69).................. Private investor (real estate and small business
1012 Chancery Lane financing); Executive Vice President (March
Nashville, Tennessee 37215 1976-November 1987) of CPS Industries, Inc. (manufacture
of gift wrapping and ribbons).
</TABLE>

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THE REQUESTING PARTIES STRONGLY RECOMMEND A VOTE FOR THE PROPOSAL B
NOMINEES IN CASE PROPOSAL A IS NOT ADOPTED IN ITS ENTIRETY BY THE SHAREHOLDERS.

The accompanying GREEN proxy card will be voted at the Special Meeting in
accordance with your instructions on such card. You may vote FOR the approval of
the Special Meeting Proposals and election of the Requesting Parties' Nominees
as directors of the Company or withhold authority to vote for approval of the
Special Meeting Proposals and the election of the Requesting Parties' Nominees
by marking the proper boxes on the GREEN proxy card. You also may withhold your
vote from any of the Requesting Parties' Nominees by writing the name of such
nominee in the space provided on the GREEN Special proxy card. IF NO MARKING IS
MADE, YOU WILL BE DEEMED TO HAVE GIVEN A DIRECTION TO VOTE THE SHARES
REPRESENTED BY THE GREEN PROXY CARD FOR BOTH SPECIAL MEETING PROPOSALS IN THEIR
ENTIRETY PROVIDED THAT YOU HAVE SIGNED AND DATED THE PROXY CARD.

It is anticipated that each of the Requesting Parties' Nominees, upon his
election as a director of the Company, will receive compensation consistent with
the Company's past practice. According to the proxy statement relating to the
Company's 1996 Annual Meeting of Shareholders, the Company has no permanent
arrangement for the compensation of its directors for their services as
directors. In 1995, however, the directors were awarded restricted shares of
Common Stock for their past services. Mr. Hodges received 1,615 shares, Messrs.
Harden, Jacobs, Keenum and Whelchel each received 3,000 shares and Messrs.
Lockyer, Junkin and Veal each received 3,615 shares. The shares are subject to
forfeiture by the recipient if such recipient does not continue serving the
Company in certain capacities. The restrictions lapse evenly over a period of
seven years from the effective date of the grant. These awards were approved by
the shareholders at the 1995 Annual Meeting of Shareholders.

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In addition, according to the 1996 Proxy Statement, the Board granted
non-statutory stock options to directors of the Company for services rendered
during fiscal year 1995 on the Board and committees of the Company and its
various subsidiaries. The following table presents information regarding such
option grants.

JANUARY 1996 OPTION GRANTS TO DIRECTORS FOR
SERVICES RENDERED IN FISCAL YEAR 1995

<TABLE>
<CAPTION>
NUMBER OF SECURITIES EXERCISE
NAME UNDERLYING OPTIONS PRICE EXPIRATION DATE
- ---- -------------------- -------- ---------------
<S> <C> <C> <C>
L. McRee Harden....................................... 1,385 $6.00 1/19/06
Michael D. Hodges..................................... 1,042 $6.00 1/19/06
Russell C. Jacobs, Jr................................. 1,263 $6.00 1/19/06
Gregory S. Junkin..................................... 1,500 $6.00 1/19/06
C. Kermit Keenum...................................... 1,045 $6.00 1/19/06
Paul D. Lockyer....................................... 1,458 $6.00 1/19/06
Jimmy D. Veal......................................... 1,958 $6.00 1/19/06
J. Thomas Whelchel.................................... 1,390 $6.00 1/19/06
</TABLE>

The options listed above were granted pursuant to the Golden Isles
Financial Holdings, Inc. 1995 Stock Option Plan, adopted by the Company on July
25, 1995.

According to publicly available information, the only committee which has
been established by the Board is the audit committee (the "Audit Committee").
The members of the Audit Committee are L. McRee Harden, Russell C. Jacobs, Jr.,
and Jimmy D. Veal. The Audit Committee held three meetings during the 1995
fiscal year. The objective of the Audit Committee is to prevent losses by the
Company from fraud, defalcation and/or operating deficiencies.

The Board met ten times during the 1995 fiscal year. Each of the directors
attended more than 75% of the aggregate of (i) the total number of meetings of
the Board; and (ii) the total number of meetings held by all committees of the
Board on which he served, during the period of the 1995 fiscal year that he
served as a director.

OTHER MATTERS TO BE CONSIDERED AT THE SPECIAL MEETING

Except as set forth above, including under the caption "IMPORTANT," the
Requesting Parties are not aware of any proposals to be brought before the
Special Meeting. Should other proposals be brought before the Special Meeting,
the persons named on the GREEN proxy card will vote on such proposals in their
discretion.

BACKGROUND OF THE CALL OF THE SPECIAL MEETING AND THIS PROXY SOLICITATION

In May 1989 and May 1994, the Company raised money from the shareholders
through the initiation of public offerings of its common stock on the basis of a
business plan for the Company which provided, first, for the establishment of
The First Bank of Brunswick (the "Bank") and then, with the Bank as an anchor,
the development of the Company into a diversified financial services company
through the establishment or acquisition of other businesses involving
commercial banking, mortgage origination and consumer finance, as well as other
financial services. In addition, the business plan contemplates a reasonable
level of geographic diversity and the prospectus relating to the 1994 offering
contemplated an expanded regional focus, generally concentrating in Southeast
Georgia and Northwest Florida, with certain products to be made available in
selected markets outside of this region. In October 1996, the Company was in the
process of implementing this business plan. Under the leadership of Mr. Junkin
and Mr. Lockyer, the Company established the Bank and managed it through losses
anticipated in the start-up phase to a position of profitability. In addition,
the Company had begun its promised diversification through establishment of the
First Credit Service Corpora-

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tion, a consumer finance subsidiary (the "FCC"), and the First Bank Mortgage
Company, a mortgage banking subsidiary (the "FBMC"), and, in the opinion of the
Requesting Parties, these two entities were coming to the end of their start-up
phases and were beginning to turn profitable. However, at just this point, the
Whelchel Group determined to make a change in the direction of the Company's
activities, stating that the Company had "deviated from the original mission of
providing banking and financial services to local communities."

On October 17, 1996, the Board removed Mr. Junkin and Mr. Lockyer, as Chief
Executive Officer and Chief Operating Officer, respectively, of the Company and
elected Mr. J. Thomas Whelchel, Vice Chairman of the Company, to serve as Chief
Executive Officer of the Company and its subsidiaries. Mr. Whelchel, thereafter
on October 25, 1996, sent a letter to the shareholders of the Company informing
them of the Board's decision to make a change of management and its proposal to
make what the Requesting Parties believe to be a significant change in the
direction of the Company's activities.

Dissatisfied with the change in the direction of the Company's activities
proposed by the Whelchel Group, on November 14, 1996, Mr. Junkin sent a letter
(the "November 14 Letter") to the shareholders of the Company outlining the
reasons for his dissatisfaction. The November 14 Letter is attached hereto as
Exhibit A.

Concurrently with the mailing of the November 14 Letter, the Requesting
Parties filed a Schedule 13D with the Securities and Exchange Commission (the
"Commission") stating that they were dissatisfied with the actions of the
Whelchel Group and that they had sent the November 14 Letter to the
shareholders. The Requesting Parties also stated that, although they had no
specific plans or proposals therefor, depending upon the response of the
Whelchel Group to the November 14 Letter, the Requesting Parties might find it
necessary to seek the removal of certain members of the Whelchel Group from the
Board or the election of their own nominees to the Board which could involve a
change in the number of directors constituting the full Board.

On December 3, 1996, the Whelchel Group sent a second letter to the
shareholders of the Company (the "December 3 Letter"), describing the financial
condition of the Company and implying that losses from the Company's
subsidiaries and expenses at the holding company level were unacceptably high
and required more corrective action. The Requesting Parties believe that the
letter is unfair and misleading because it fails to discuss the financial
statements of the Company and related issues in the proper context. In the cover
letter (the "Cover Letter") to the Request Solicitation Statement sent by the
Requesting Parties to the shareholders on December 24, 1996 (the "Request
Solicitation Statement"), Mr. Junkin and Mr. Lockyer endeavored to discuss in
context the figures provided by the Board in its December 3 Letter and in so
doing in their view have provided the shareholders with a more accurate
description of the financial condition and prospects of the Company and its
subsidiaries. The Cover Letter is attached hereto as Exhibit B.

Shortly after sending the December 3 Letter, on December 9, 1996, by a vote
of 5 to 2, the Board made an official decision to dismantle FBMC and transfer
the remnants of the mortgage business to the Bank. During the week of December
9, 1996, Messrs. Whelchel and Hodges began firing FBMC employees. The Board
action was taken over the objections of Mr. Junkin and Mr. Lockyer who
emphasized to the Board their beliefs that the action was being taken just after
FBMC had apparently "turned the corner" on profitability in October and that it
was in opposition to the best interests of the shareholders of the Company
because it would result in a waste of a great deal of the Company's substantial
investment in the mortgage business and would be inconsistent with the business
plan used by the Company to raise money from the shareholders. The Requesting
Parties do not believe that the continuance of the mortgage business within the
Bank is an adequate substitute for a stand-alone mortgage banking subsidiary,
which would enjoy more flexibility and could in many ways be operated more
efficiently. See the Cover Letter.

The action to dismantle FBMC caused the Requesting Parties to seek the
Special Meeting. On December 24, 1996, the Requesting Parties distributed to the
shareholders the Request Solicitation Statement, soliciting requests
("Requests") from the shareholders of the Company to require the Company to call
a Special Meeting pursuant to Article 2, Section 2.4 of the Bylaws.

8
<PAGE> 10

In opposition to the Requesting Parties' solicitation of Requests to call
the Special Meeting, the Whelchel Group sent on January 3, 1997 a third letter
to the shareholders (the "January 3 Letter"). In the view of the Requesting
Parties, the January 3 Letter failed to respond to the substantive issues
concerning the business and future of the Company addressed in the Requesting
Parties' Request Solicitation Statement. Instead, the Whelchel Group's January 3
Letter attempted to persuade the shareholders not to request the call of the
Special Meeting by means of a personal attack on Mr. Junkin, which included
statements that in the opinion of the Requesting Parties were false and
misleading, as well as inconsistent with prior statements made by the Whelchel
Group.

On January 7, 1997, in a separate letter (the "January 7 Letter") to the
shareholders, Mr. Junkin responded to the January 3 Letter, by addressing the
personal allegations, correcting some of the false and misleading statements and
pointing out the inconsistencies between the January 3 Letter and prior
statements made by the Whelchel Group. The January 7 Letter is attached as
Exhibit C hereto.

On January 17, 1997, the Requesting Parties delivered to the Company
Requests on behalf of the holders of more than 25% of the outstanding Shares. On
January 17, 1997, Mr. Junkin, as the "Officer of Persons Calling the Meeting"
appointed by holders of more than 25% of the outstanding Shares, delivered
notice (the "Original Notice") to the shareholders of the Special Meeting.

After the Original Notice had been delivered by Mr. Junkin to the
shareholders, the Whelchel Group's attorney sent, on January 22, 1997, a letter
to Mr. Junkin's attorneys purportedly questioning Mr. Junkin's authority to send
the Original Notice and stating the Whelchel Group's desire for the Special
Meeting to be delayed until March 20, 1997. Mr. Junkin replied to the letter
through his attorney by clarifying for the Whelchel Group and their attorney the
basis for Mr. Junkin's authority to send the notice and agreeing to postpone the
Special Meeting at the request of the Whelchel Group so long as the Special
Meeting would occur no later than Tuesday, March 11, 1997. In addition, to avoid
further controversy about the Special Meeting, Mr. Junkin's response was
conditioned upon the Board's passing resolutions confirming that (i) the
shareholders have made a valid demand for the Special Meeting, (ii) the Original
Notice is ratified, approved and confirmed; (iii) the date of the Special
Meeting would be deferred to March 11, 1997; (iv) the Board will not take any
action to delay or defer holding the Special Meeting on the mutually agreed
date; (v) the Board authorizes Mr. Junkin to give an amended notice of the
Special Meeting; and (vi) the record date for the Special Meeting will be the
date the first amended notice is sent to the shareholders.

On January 28, 1997, Mr. Junkin's attorneys sent to the Whelchel Group's
attorneys a letter stating that the Special Meeting would be conducted in
accordance with the Bylaws, as in effect on such date.

On January 29, 1997, the Board, by a unanimous written consent, confirmed
the items listed above. On the same date, Mr. Junkin, as the "Officer of Persons
Calling the Meeting", delivered an amended notice (the "Amended Notice") of the
Special Meeting to the shareholders.

PROXY PROCEDURES

In order for your views on the above-described proposals to be represented
at the Special Meeting, please mark, sign and date the enclosed GREEN proxy card
and return it in the enclosed envelope in time to be voted at the particular
meeting. Execution of the GREEN proxy cards will not affect your right to attend
the Special Meeting and to vote in person.

Only Record Holders are eligible to execute a GREEN proxy card. Persons
owning Shares "beneficially" (i.e., deriving the economic benefits of ownership
thereof or having the power to vote or dispose of shares), but not "of record"
(i.e., having one's name recorded on the stock transfer records of the Company),
such as persons whose ownership of Shares is through a broker, bank, other
financial institution or other record holder should contact their broker, bank,
other financial institution or other record holder and instruct such person or
entity to execute the GREEN proxy card on their behalf.

9
<PAGE> 11

RECORD DATE

The Bylaws provide that the record date for determining shareholders
entitled to vote at a special meeting is the date that the notice of the special
meeting is given. On January 29, 1997, Mr. Junkin gave the Amended Notice to the
shareholders of the Special Meeting. Accordingly, the Record Date for the
purposes of the Special Meeting is January 29, 1997.

Only Record Holders are entitled to vote at the Special Meeting. If you
acquired Shares after the Record Date without a proxy, you may not execute a
Proxy to vote at the Special Meeting with respect to such Shares. A Record
Holder will retain the right to execute a proxy card in connection with this
Proxy Solicitation even if such Record Holder sells such Shares after the Record
Date.

REVOCATION OF REQUEST

A Proxy executed and delivered by a Record Holder may subsequently be
revoked by written notice of revocation to Mr. Junkin or the Company or by your
vote at the Special Meeting. A revocation may be in any written form validly
signed and dated by the Record Holder as long as it clearly states that such
Record Holder's Proxy previously given is no longer effective. Any valid
revocation delivered to Mr. Junkin or the Company shall supersede any previously
dated or undated GREEN proxy card. To be effective, a Record Holder's written
notice of revocation of his or her previously executed and delivered Proxy must
be signed, dated and delivered prior to the date of the Special Meeting.

Any revocation may be delivered to either Mr. Junkin at the address
provided on the back of this Proxy Statement or to the Company at any address
provided by the Company. The Requesting Parties request that, if a revocation is
delivered to the Company, a photostatic or other legible copy of the revocation
also be delivered to Mr. Junkin at the address set forth above. In this manner,
the Requesting Parties will be aware of all revocations.

If a Record Holder signs, dates and delivers a GREEN proxy card and
thereafter, on one or more occasions, dates, signs and delivers a later-dated
GREEN proxy card, the latest-dated GREEN proxy card will be controlling as to
the instructions indicated therein and will supersede such Record Holder's prior
Proxy or Proxies as embodied in any previously submitted GREEN proxy cards;
provided, however, that any such later-dated GREEN proxy card will be
inoperative and of no effect if it is delivered after the Special Meeting. ONLY
YOUR LATEST DATED PROXY FOR THE SPECIAL MEETING WILL COUNT AT THE MEETING.

If the Board chooses to oppose the Requesting Parties' Proxy Solicitation
and if, in such instance, a Record Holder signs a proxy revocation card sent to
such Record Holder by the Board, such Record Holder may override that revocation
by returning to Mr. Junkin a subsequently dated and signed GREEN proxy card.

SOLICITATION EXPENSES AND PROCEDURES

The entire expense of preparing, assembling, printing and mailing the Proxy
Statement and the accompanying form of Proxy and the cost of soliciting Proxies
(collectively, the "Solicitation Expenses") will be borne by Mr. Junkin. Mr.
Junkin reserves the right, though no final determination has been made, to seek
reimbursement from the Company for Solicitation Expenses if any of the
Requesting Parties' Nominees are elected to the Board at the Special Meeting.
Such reimbursement would be submitted to vote of the shareholders of the Company
at the next annual meeting of the Company.

In addition to the use of the mails, Proxies may be solicited by the
Requesting Parties by telephone, facsimile, telegraph and personal interviews,
for which no additional compensation will be paid to such individuals. The
Requesting Parties request banks, brokerage houses and other custodians,
nominees and fiduciaries to forward all of their solicitation materials to the
beneficial owners of the Shares they hold of record. The Requesting Parties will
reimburse these record holders for customary clerical and mailing expenses
incurred by them in forwarding these materials to their customers.

10
<PAGE> 12

The Requesting Parties estimate that Solicitation Expenses will total
approximately $150,000. To date, the Requesting Parties have spent $120,000 of
such total estimated Solicitation Expenses.

The Requesting Parties currently do not intend to retain a proxy
solicitation firm to solicit proxies in connection with the Special Meeting, but
may determine to do so at any time prior to the Special Meeting. In the event
the Requesting Parties determine to retain a proxy solicitation firm, it is
anticipated that the proxy solicitation firm would solicit proxies for the
Special Meeting from individuals, brokers, banks, bank nominees and other
institutional holders.

CERTAIN INFORMATION CONCERNING THE PARTICIPANTS

Mr. Junkin, Mr. Lockyer and Scott Junkin and the Requesting Parties'
Nominees may be deemed to be "participants" (as defined in Instruction 3 to Item
4 of Rule 14a -101 of the Exchange Act) in this Proxy Solicitation. Mr. Junkin
and Mr. Lockyer currently serve on the Board.

Certain information relating to the beneficial ownership of Shares by
participants in the solicitation and certain other information is contained in
Schedule I hereto and is incorporated herein by reference.

ADDITIONAL INFORMATION

The principal executive offices of the Company are at 200 Plantation Chase,
St. Simons Island, Georgia 31522. Except as otherwise noted herein, the
information concerning the Company has been taken from or is based upon
documents and records on file with the Commission and other publicly available
information. Although the Requesting Parties do not have any knowledge that
would indicate that any statement contained herein based upon such documents and
records is untrue, the Requesting Parties do not take any responsibility for the
accuracy or completeness of the information contained in such documents and
records, or for any failure by the Company to disclose events that may affect
the significance or accuracy of such information.

For information regarding the security ownership of certain beneficial
owners and the management of the Company, see Schedule II.

NO MATTER HOW MANY SHARES YOU OWN, YOUR VOTE IS VERY IMPORTANT. PLEASE SIGN
AND DATE THE ENCLOSED GREEN PROXY CARD AND PROMPTLY RETURN IT IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.

11
<PAGE> 13

SCHEDULE I

BENEFICIAL OWNERSHIP OF
SHARES BY PARTICIPANTS IN THE SOLICITATION

Mr. Junkin has his principal business address at P.O. Box 30297, Sea
Island, Georgia 31561. Mr. Lockyer has his principal residential address at 311
Dunbarton Drive, St. Simons Island, Georgia 31522. Mr. Scott Junkin has his
principal business address at 62 Southfield Avenue, Stamford, Connecticut 06902.
Until October 17, 1996, Mr. Junkin and Mr. Lockyer served as the Chief Executive
Officer and Chief Operating Officer, respectively, of the Company. Mr. Junkin
and Mr. Lockyer are retired. Mr. Scott Junkin is an attorney.

As of the date of this Proxy Statement, Mr. Junkin is deemed to
beneficially own (as that term is defined in Rule 13d-3 under the Exchange Act,
as amended) 105,653 shares of Common Stock, which constitutes 4.5% of the
outstanding shares of Common Stock and includes 5,544 shares which Mr. Junkin
has a right to acquire pursuant to warrants or options. As of the date of this
Proxy Statement, Mr. Lockyer is deemed to beneficially own (as that term is
defined in Rule 13d-3 under the Exchange Act, as amended) 21,058 shares of
Common Stock, which constitutes 1.7% of the outstanding shares of Common Stock
and includes 1,458 shares which Mr. Lockyer has a right to acquire pursuant to
options. As of the date of this Proxy Statement, Mr. Scott Junkin is deemed to
beneficially own (as that term is defined in Rule 13d-3 under the Exchange Act,
as amended) 37,244 shares of Common Stock, which constitutes 1.6% of the
outstanding shares of Common Stock and includes 9,872 shares that may be
acquired pursuant to warrants. As of January 29, 1997, Mr. Junkin had
outstanding indebtedness of $62,588 and Mr. Scott Junkin had outstanding
indebtedness of $14,010 which they individually incurred for the purpose of
acquiring shares in the initial public offering of Common Stock of the Company.

As of the date of this Proxy Statement, Edward V. Baich is deemed to
beneficially own (as that term is defined in Rule 13d-3 under the Exchange Act,
as amended) 5,262 shares of Common Stock, which constitutes less than one
percent of the outstanding Common Stock and includes 2,631 shares which Mr.
Baich has a right to acquire pursuant to warrants. As of the date of this Proxy
Statement, John M. Froehlich is deemed to beneficially own (as that term is
defined in Rule 13d-3 under the Exchange Act, as amended) 2,494 shares of Common
Stock, which constitutes less than one percent of the outstanding Common Stock
and includes 1,247 shares which Mr. Froehlich has a right to acquire pursuant to
warrants. As of the date of this Proxy Statement, Frank J. Guzikowski is deemed
to beneficially own (as that term is defined in Rule 13d-3 under the Exchange
Act, as amended) 32,076 shares of Common Stock, which constitutes 1.4% of the
outstanding Common Stock and includes 4,038 shares which Mr. Guzikowski has a
right to acquire pursuant to warrants, 12,000 shares which are held by his wife
as custodian for his grandchildren and 12,000 shares for which warrants held by
his wife as custodian for his grandchildren may be exercised. As of the date of
this Proxy Statement, Richard S. Holson, Jr. is deemed to beneficially own (as
that term is defined in Rule 13d-3 under the Exchange Act, as amended) 19,125
shares of Common Stock, which constitutes less than one percent of the
outstanding Common Stock and includes 2500 shares which Mr. Holson has a right
to acquire pursuant to warrants and 1,625 shares held by VVGH, LP (a limited
partnership in which Mr. Holson is one of four limited partners) with respect to
which shares Mr. Holson has the individual power to vote or direct the vote, or
to dispose of or direct the disposition of, but does not include 4,875 shares
held by VVGH, LP with respect to which Mr. Holson does not have such individual
(or shared) power. As of the date of this Proxy Statement, James M. Showalter is
deemed to beneficially own (as that term is defined in Rule 13d-3 under the
Exchange Act, as amended) 4,408 shares of Common Stock, which constitutes less
than one percent of the outstanding Common Stock and includes 1,669 shares held
in an IRA for Mr. Showalter, 1,669 shares for which warrants held in Mr.
Showalter's IRA may be exercised, 535 shares held in an IRA for Mr. Showalter's
wife and 535 shares for which warrants held in the IRA for Mr. Showalter's wife
may be exercised.

As of the date of this Proxy Statement, Mr. Junkin owns of record 100,109
Shares, Mr. Lockyer owns of record 19,600 Shares, Mr. Scott Junkin owns of
record 9,872 Shares, Mr. Baich owns of record 2,631 Shares, Mr. Froehlich owns
of record 1,247 Shares, Mr. Guzikowski owns of record 4,038 Shares, Mr. Holson
owns of record 15,000 Shares, and Mr. Showalter owns no Shares of record.

12
<PAGE> 14

The participants in this Proxy Solicitation have purchased or sold the
following Shares within the last 2 years:

<TABLE>
<CAPTION>
SHARES PRICE
PARTICIPANT TRANSACTION DATE PURCHASED/SOLD PER SHARE
- ----------- ---------------- -------------- ---------
<S> <C> <C> <C>
Paul D. Lockyer........................... February 2, 1996 3,125 $6.00
sold
Gregory S. Junkin......................... March 31, 1995 4,044(1) $6.50
purchased
Scott A. Junkin........................... March 31, 1995 9,872(1) $6.50
purchased
Edward V. Baich........................... March 31, 1995 2,631(1) $6.50
purchased
John M. Froehlich......................... March 31, 1995 1,247(1) $6.50
purchased
Frank J. Guzikowski....................... March 31, 1995 16,038(1)(2) $6.50
purchased
Richard S. Holson, Jr..................... March 31, 1995 2,500(1) $6.50
purchased
1,625(3)
purchased
James M. Showalter........................ March 31, 1995 2,204(1)(4) $6.50
purchased
------
Total:.......................... 43,286
======
</TABLE>

- ---------------

(1) A number of warrants equal to the number of Shares purchased was purchased
concurrently by the participant without additional consideration.

(2) Includes 12,000 shares held by Mr. Guzikowski's wife as custodian for his
grandchildren.

(3) Includes 1,625 Shares purchased by VVGH, LP of which Mr. Holson is deemed to
have beneficial ownership, but does not include the other 4,875 Shares
purchased by VVGH, LP on December 13, 1996 at a price of $5.50.

(4) Includes 1,669 shares held in Mr. Showalter's IRA and 535 shares held in the
IRA of Mr. Showalter's wife.

Except as otherwise set forth in this Schedule I, none of the participants
in this Proxy Solicitation or any associate of any of the foregoing persons or
any other person who may be deemed a "participant" in this solicitation has
purchased or sold any Shares within the past two years, borrowed any funds for
the purpose of acquiring or holding any Shares, or is or was within the past
year a party to any contract, arrangement or understanding with any person with
respect to any Shares. There have not been any transactions since the beginning
of the Company's last fiscal year and there is not any currently proposed
transaction to which the Company or any of its subsidiaries was or is to be a
party, in which any of Mr. Junkin, Mr. Lockyer or Mr. Scott Junkin or any
associate or immediate family member of any of the foregoing persons or any
other person who may be deemed a "participant" in this solicitation had or will
have a direct or indirect material interest. Other than the directorships
contemplated by the Special Meeting Proposals, none of Mr. Junkin, Mr. Lockyer
or Mr. Scott Junkin or any associate of any of the foregoing persons or any
other person who may be deemed a "participant" in this solicitation has any
arrangement or understanding with any person with respect to any future
employment by the Company or its affiliates, or with respect to any future
transactions to which the Company or its affiliates will or may be a party.

Mr. Lockyer is a participant in the 1991 Incentive Stock Option Plan and
1991 Nonstatutory Stock Option Plan adopted by the Company on May 30, 1991.

13
<PAGE> 15

SCHEDULE II

SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Information relating to beneficial ownership of Common Stock is based upon
"beneficial ownership" concepts set forth in rules of the SEC under Section
13(d) of the Exchange Act. Under such rules, a person is deemed to be a
"beneficial owner" of a security if that person has or shares "voting power",
which includes the power to dispose of, or to direct the disposition of, such
security. A person is also deemed to be a beneficial owner of any security of
which that person has the right to acquire beneficial ownership within sixty
(60) days. Under the rules, more than one person may be deemed to be a
beneficial owner of the same securities, and a person may be deemed to be a
beneficial owner of securities as to which he has no beneficial interest. For
instance, beneficial ownership includes spouses, minor children and other
relatives residing in the same household, and trusts, partnerships, corporations
or deferred compensation plans which are affiliated with the principal.

The following table sets forth share ownership information as of April 1,
1996, with respect to persons known at such date to the Company to be beneficial
owners of more than 5% of the Shares, as such information was set forth in the
1996 Proxy Statement, and as of January 27, 1997 with respect to the beneficial
ownership of the Requesting Parties. The information as to beneficial ownership
by Leonard W. Golan, according to the 1996 Proxy Statement, was furnished to the
Company by or on behalf of Mr. Golan. Unless otherwise indicated, each of the
shareholders has sole voting and investment power with respect to the shares of
Common Stock beneficially owned.

<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES CLASS
- ------------------------------------ --------- ----------
<S> <C> <C>
Leonard W. Golan (1)........................................ 200,102 8.3%
21st Floor, Three First National Plaza
Chicago, Illinois 60602
Gregory S. Junkin, Paul D. Lockyer, Scott A. Junkin(2)...... 146,455 7.1%
P.O. Box 30297
Sea Island, Georgia 31561
</TABLE>

- ---------------

(1) Mr. Golan's beneficial ownership of the shares of Common Stock attributed to
him stems from (i) his having voting and investment power with respect to
certain of those shares in his capacity as Trustee of each of the Leonard
W. Golan Insurance Trust dated January 23, 1968, the Carol P. Golan
Insurance Trust dated November 7, 1977, and the Carol P. Golan QTIP Trust
dated April 18, 1995, and (ii) his claiming beneficial ownership of certain
shares registered in the name of his son, John F. Golan. The number of
shares beneficially owned by Mr. Golan includes the right to acquire 64,642
shares pursuant to Class A Warrants owned by Mr. Golan.
(2) Includes shares held by these individuals as a "group" as such term is used
in Section 13(d)(3) of the Exchange Act and includes rights of the members
of the group to acquire 48,481 Shares pursuant to Class A Warrants and
2,958 Shares pursuant to the exercise of vested options.

The following table sets forth, as of April 1, 1996 (except as otherwise
noted below), the name and address of, and the total number of Shares (if any)
of the Company beneficially owned (as defined in Rule 13d-3 under the Exchange
Act) and the percentage of outstanding Shares beneficially owned by, (i) each
person who is known to the Company to own beneficially 5% or more of the
outstanding Shares, (ii) each director of the Company, (iii) the Company's Chief
Executive Officer and each of its executive officers and (iv) all directors and
executive officers as a group. Except with respect to the percentage ownership
set forth for Mr. Junkin and Mr. Lockyer, the information presented below has
been taken from or is based upon documents and records on file with the
Commission and other publicly available information. Since April 1, 1996, the
total outstanding Shares has increased to 2,344,302. The percentage ownership
for Mr. Junkin and Mr. Lockyer set forth below is calculated on the basis of
2,344,302 outstanding Shares. Although the Requesting Parties do not have any
knowledge that would indicate that any statement contained herein based

14
<PAGE> 16

upon such documents and records is untrue, the Requesting Parties do not take
any responsibility for the accuracy or completeness of the information contained
in such documents and records, or for any failure by the Company to disclose
events that may affect the significance or accuracy of such information.

<TABLE>
<CAPTION>
NAME AND ADDRESS OF BENEFICIAL OWNER NUMBER OF SHARES PERCENTAGE OF CLASS
- ------------------------------------ ---------------- -------------------
<S> <C> <C>
L. McRee Harden(1)......................................... 19,385 *
P.O. Box 2369
Darien, Georgia 31305
Michael D. Hodges(2)....................................... 38,764 1.6%
207 Dunbarton Drive
St. Simons Island, Georgia 31522
Russell C. Jacobs, Jr.(3).................................. 16,763 *
308 Oak Grove Island Drive
Brunswick, Georgia 31525
Gregory S. Junkin(4)....................................... 105,653 4.5%(9)
P.O. Box 30297
Sea Island, Georgia 31522
C. Kermit Keenum(5)........................................ 16,545 *
100 Old Mountain Road
Powder Springs, Georgia 30073
Paul D. Lockyer(6)......................................... 21,058 *(9)
311 Dunbarton Drive
St. Simons Island, Georgia 31522
Jimmy D. Veal(7)........................................... 81,898 3.4%
711 Beachview Drive
Jekyll Island, Georgia 31527
J. Thomas Whelchel(8)...................................... 31,740 1.4%
5 Glynn Avenue
Brunswick, Georgia 31520
All persons and executive officers as a group(8 persons)... 331,806 14.2%
</TABLE>

- ---------------

* Less than 1%.
(1) Includes 1,250 shares owned by his wife for which he disclaims beneficial
ownership. Also includes the right to acquire 1,385 shares pursuant to
vested options.
(2) Includes the right to acquire 30,124 shares pursuant to vested options.
(3) Includes the right to acquire 1,263 shares pursuant to vested options.
(4) Includes the right to acquire 4,044 shares pursuant to Class A Warrants, and
1,500 shares pursuant to vested options and 17,500 shares which he holds as
nominee for Mr. Scott Junkin and as to which he does not have dispositive
power.
(5) Includes the right to acquire 1,045 shares pursuant to vested options.
(6) Includes the right to acquire 1,458 shares pursuant to vested options.
(7) Includes 9,125 shares owned as custodian for his son, Daniel D. Veal, 9,125
shares owned as custodian for his son, Zachary T. Veal, both under the
Uniform Gifts to Minors Act, and 1,958 shares pursuant to vested options.
(8) Includes 25 shares owned by Mr. Whelchel's daughter for which he disclaims
beneficial ownership, and 1,390 shares pursuant to vested options.
(9) Since April 1, 1996, the total number of outstanding Shares has increased to
2,344,302. The percentage ownership for Mr. Junkin and Mr. Lockyer set
forth above is calculated on the basis of 2,344,302 outstanding Shares.

15
<PAGE> 17

EXHIBIT A

THE NOVEMBER 14 LETTER

TO: My Fellow Shareholders

DATE: November 14, 1996

By now you should have received Mr. J. Thomas Whelchel's letter of October
25, 1996 regarding the removal of Mr. Paul D. Lockyer and me as the senior
management of Golden Isles Financial Holdings, Inc. (the "Company").

It is necessary to respond to Mr. Whelchel's letter for at least two
reasons. First, Mr. Whelchel's letter creates the impression that Mr. Lockyer
and I have done something illegal or improper in managing the affairs of the
Company. This impression is false and misleading, without any foundation
whatsoever. Through my attorneys, I have informed Mr. Whelchel that I consider
his letter libelous and I have demanded a written apology and that a retraction
be sent to all shareholders. Mr. Whelchel has not yet responded.

Second, Mr. Whelchel is proposing in his letter to make a very significant
change in the Company's goals and operations, a change that I believe could
reduce the Company's prospects for growth, increase the riskiness of its
operations, and ultimately jeopardize its profitability. Every shareholder
should be aware of the business implications of Mr. Whelchel's letter.

Specifically, Mr. Whelchel is proposing to limit the Company's mission to
providing banking and financial services in local communities, presumably in the
Glynn County area. Although Mr. Whelchel has been a director almost since the
inception of the Company, he seems unaware that the Company's mission was never
to be solely a community bank. As stated in our 1994 prospectus (the basis on
which many of you invested), the Company was formed with the purpose of becoming
a diversified financial services company operating in Georgia, other sections of
the Southeast, and in other geographic areas offering attractive opportunities.
The Company's business plan has always been to establish a commercial banking
business and then expand into other financial services businesses that are less
intensively regulated and potentially more profitable than banking, and that add
income streams and cross-selling opportunities to the Company.

If the Company abandons this business plan (which has served the Company
well, as reflected in Mr. Whelchel's discussion of the Company's good overall
financial position) and focuses only on local communities, the Company will be
foregoing the opportunity to grow and diversify its operations beyond the
expected needs of Glynn County. Without greater geographic scope, the Company
will be more vulnerable to adverse economic developments in its home area. Such
a limited scope may also force the Company to limit the range of services it
might otherwise offer, which would increase its exposure to its core business of
community banking.

While under management by Paul Lockyer and me, the Company sought to avoid
these risks through a plan of geographic and product expansion, including the
start-up of mortgage banking and consumer finance subsidiaries. In the course of
implementing the Company's long-standing business plan, Mr. Lockyer and I
oversaw the Company's growth from total assets of only $13.1 million on December
31, 1990 to total assets of $108 million on August 31, 1996, representing an
eight-fold increase in just five and one-half years. The consumer finance unit
appears to be achieving our forecasts of the past year, which called for it to
be operating profitably by the fourth quarter of 1996. Mr. Whelchel has
acknowledged the improving performance of this unit. Although the mortgage
banking unit has incurred some losses, the unit appeared to be at the point of
operating profitably as of October 17, 1996 (the date of the Board's action
concerning Paul and me). Overall, the Company is in a good position to realize
on its investment in the start-up costs of the consumer finance and mortgage
banking units. This opportunity may be greatly diminished if the Company adopts
Mr. Whelchel's plan for a more limited, community-based focus, or if the
professional management recruited to the Company over the past year, at
considerable Company expense and time, choose to resign because of their lack of
confidence in the interim management.

A-1
<PAGE> 18

Mr. Whelchel attempts to defend his proposal for a fundamental change in
the Company's business plan by saying it is a return to the Company's "original
mission." This is incorrect, as noted above. Mr. Whelchel also contends that the
Company must change its direction because there are excessive losses in the
mortgage banking unit that need to be "examined", and there are excessive costs
at the holding company level. I believe Mr. Whelchel is wrong on both counts.

Mr. Whelchel's letter fails to describe the full circumstances surrounding
the mortgage banking unit. First, Mr. Whelchel has greatly overstated the amount
of losses incurred with respect to mortgage banking during 1996. The $400,000
operating loss cited by Mr. Whelchel completely ignores the fact that the
mortgage banking unit also generated approximately $300,000 in net interest
income for our Bank. This income reduces the 1996 loss through August to
approximately $100,000, on a consolidated basis. Second, Mr. Whelchel has failed
to disclose that, prior to October 17, the problems in the mortgage banking unit
had already been "examined" -- by the previous management team -- and decisive
action had already been taken -- again by the previous management team -- to
correct those problems.

In fact, Paul Lockyer and I recognized the losses in the mortgage banking
unit months ago. We proposed and obtained unanimous Board approval for a
restructuring plan in September and immediately thereafter cut costs, reduced
personnel and terminated the warehouse lending operation, which was a major
source of the problem. In September, we projected that the mortgage banking unit
would begin operating profitably (exclusive of restructuring costs) in the
fourth quarter of 1996. As noted above, the information available to me confirms
that this was indeed happening. By the time of the Board's action on October 17,
the unit's production volume met the projections set forth in the restructuring
plan and the unit seemed likely to meet our projections for the fourth quarter.

However, as a result of the recent turmoil, it is difficult to expect
employees and customers to continue to respond in the positive fashion we were
experiencing prior to October 17. It is my opinion that as a result of the
precipitous action of the Board on that date, we can anticipate the mortgage
banking unit's losing money in the fourth quarter, rather than breaking even or
making a profit. Employee morale is extremely low, with employees fearful that
the mortgage banking unit will be eliminated altogether and they will lose their
jobs. In addition, I understand that the Company has begun to lose business as
competitors suggest to customers and prospects that our mortgage banking unit is
going out of business.

As for costs at the holding company level, Mr. Whelchel again has not
described the full circumstances. A large percentage of the $960,000 in
annualized costs for 1996 consists of interest expense incurred by the holding
company to help finance the operating units. The operating units reimburse the
holding company for a portion of this expense, providing the holding company
with interest income. Based on unaudited numbers through August 31, 1996, the
holding company can expect annualized interest income for 1996 of approximately
$265,000. This interest income offsets approximately 27.5% of the holding
company expenses identified by Mr. Whelchel. If the annualized interest income
to the holding company is deducted from Mr. Whelchel's 1996 annualized figures,
then the net annualized expenses for 1996 are only $695,000. While it is correct
that non-interest expenses at the holding company increased significantly during
the twelve months ending August 31, 1996 (by approximately 31%), the Company's
assets grew during the same period from approximately $70.9 million to $108
million -- a growth of about 52%.

The growth in non-interest expense at the holding company level has come in
large part from additions to personnel. In criticizing the growth of these
expenses, Mr. Whelchel ignores the fact that a business is not as likely to grow
successfully unless it attracts and retains first quality professional staff. To
service the needs of our three growing subsidiaries, the previous management
team felt it prudent to add a professional staff member in each of the following
areas where we previously did not have a single dedicated staff member at any
level in the organization: human resources, information systems, internal audit
and compliance. Such personnel were hired at the holding company level because
that was obviously more cost-effective than hiring staff in each of these areas
for each subsidiary. Mr. Whelchel's implicit complaint about these personnel
expenses seems to suggest that either he would prefer the Company to take the
less cost-effective approach and hire professional staff at each subsidiary, or
he would have the Company do without management expertise in these areas
altogether. Neither approach makes sense to me. Mr. Whelchel's failure to
recognize

A-2
<PAGE> 19

these considerations is disturbing, and has apparently led him to the conclusion
that costs must be cut by reducing management personnel -- to the point that I
am concerned the Company could be left without the experienced industry
professionals needed to guide it. This would be a dangerous state of affairs for
the Company.

As many of you know, I am one of the Company's founders, the second largest
shareholder and continue to be a director. I personally raised a large portion
of the Company's capital. There can be no doubt that I have a significant
continuing stake in the Company's welfare. I believe Mr. Whelchel's plan to
limit the Company to a community focus is riskier and offers less growth and
profit potential than continued pursuit of a full service regional financial
services business. Mr. Whelchel's letter of October 25 suggests to me that he
does not fully appreciate the complexities of the Company's business,
notwithstanding the frequent Board meetings (25 days of meetings in the last 24
months alone) at which previous management kept the Board fully informed about
the Company's activities and position. Mr. Whelchel's letter has not been
totally candid about the situation at the mortgage banking unit, nor about the
level of holding company expenses. In my view, his plan merely to "evaluate" the
situation for an unspecified period of time threatens to disrupt the Company's
relationships with its customers, employees and financing sources. If the
Company adopts Mr. Whelchel's proposal, it will abandon a promising strategy for
maximizing long term shareholder value. Every shareholder should be deeply
concerned about such a prospect.

For the reasons outlined above, as well as many others not mentioned in
this letter, I feel a very strong obligation to make my views known regarding
this potentially disastrous situation. If you share my concerns, you may wish to
contact the Board directly. I am presently considering what additional action I
may take. On the advice of counsel, I am also filing with the U.S. Securities
and Exchange Commission certain forms that may be required under the federal
securities laws, specifically a Schedule 13D and certain information required
under Regulation 14A, regarding, among other things, my current intentions in
this matter.

Sincerely,

Gregory S. Junkin

cc: Bruce N. Hawthorne, Esq.

M. Robert Thornton, Esq.

A-3
<PAGE> 20

EXHIBIT B

THE COVER LETTER

December 23, 1996

TO: To Our Fellow Shareholders

FROM: Gregory S. Junkin and Paul D. Lockyer

We are writing to you concerning the letter, dated December 3, 1996, sent
to you as shareholders of Golden Isles Financial Holdings, Inc. (the "Company"),
by Mr. J. Thomas Whelchel and certain other members of the Company's Board of
Directors (collectively, the "Whelchel Group"). This letter paints a picture of
the Company and its subsidiaries which, if not considered in light of additional
information, would lead anyone reading it to conclude that losses from the
Company's subsidiaries, and expenses at the holding company, are unacceptably
high and require further corrective action. In our view, however, the December
3, 1996 letter fails to put the performance of the Company and related issues in
their proper perspective.

The Whelchel Group contends that the losses at First Bank Mortgage
Corporation ("FBMC") cannot continue, and therefore the Company must assess its
options with respect to FBMC. In fact, the Whelchel Group has used these losses
as a justification for shutting down FBMC transferring the remnants of the
mortgage business to The First Bank of Brunswick (the "Bank") and thereby
wasting a great deal of the Company's substantial investment in the mortgage
business. We consider this action by the Whelchel Group to be a significant and
unwise step in converting the Company from a diversified financial services
business to a community banking institution. We have dissented from this action,
which we consider to be in flagrant disregard of the Company's stated business
strategy. We also believe that this action significantly jeopardizes the
Company's prospects for long-term growth, in a short-sighted attempt to reduce
short-term losses.

The losses and expenses cited by the Whelchel Group in the December 3, 1996
letter should be considered in the following context. As you know, the Company
operates through three subsidiaries, the Bank, FBMC and First Credit Service
Corporation. While FBMC did have a reported operating loss of $543,435 before
tax for the nine months through September 30, 1996, we think this figure does
not, in a number of ways fully reflect FBMC's performance. First, it ignores the
fact that during the same period, FBMC's operations generated approximately
$360,000 in net interest income for the Bank. The Bank earned that income solely
by virtue of FBMC's activities. FBMC's customers obtained short-term loans from
the Bank for their own customers (at rates of interest higher than the Bank's
borrowing cost), thereby generating net interest to the Bank. If that income
were recognized in FBMC's financial statements, rather than the Bank's, FBMC's
operating loss would be cut by almost two-thirds, to $183,435. Viewed another
way, if FBMC had not been operating during that period, the Bank's pre-tax
profit would have been reduced by $360,000 or about 42%. FBMC's operations
clearly provided a significant benefit to the Bank (and thus to the Company)
during this period, which should be considered in evaluating whether the
mortgage banking business is a desirable business for the Company.

Second, FBMC's operating loss also includes deductions for items that are
not actual cash outlays incurred in running the mortgage banking business on an
ongoing basis. For example, the operating loss includes $50,000 in reserves for
possible future loan losses. These reserves do not represent an actual cash
outlay for loan losses. The FBMC operating loss also includes, according to the
Whelchel Group, approximately $65,000 in non-recurring restructuring expenses,
which were incurred in carrying out the restructuring plan unanimously adopted,
at our urging, by the entire Board, in early September. Although these amounts
are cash outlays, they are non-recurring (one-time) expenses relating solely to
the restructuring and not representative of future expenses expected in the
mortgage banking operation, if continued in accordance with the September
restructuring plan.

Accordingly, we think that, when the loss from FBMC's operations is
considered in light of the significant benefits FBMC provided to the Bank (and
thus the Company overall), and further considered from a cash standpoint, the
loss is reasonable given the start-up nature of FBMC's operations. Specifically,
the Company's net cash outflow from the operations of FBMC (i.e., the reported
operating loss reduced by the Bank's net

B-1
<PAGE> 21

interest income attributable to such operations, the non-cash reserve and the
nonrecurring restructuring expenses) would be only $68,435 for the nine months
ending September 30, 1996. The Requesting Parties have discussed the Company's
net cash outflow for illustrative purposes only and are not suggesting that net
cash outflow should be viewed as an alternative to GAAP operating income as an
indicator of operating performance of FBMC.

Equally important, FBMC management reported to the Board that on an
operating basis for the month of October, 1996, FBMC made a profit and, even
when the non-recurring restructuring costs are taken into account, broke even.
This information suggests to us that, by October, FBMC had "turned the corner"
on profitability. (It is our opinion that, had the Board confirmed to FBMC
management the Board's support for the mortgage banking business on a
stand-alone basis, FBMC would have continued to implement the restructuring plan
and maintained or improved its profitability. However, the Whelchel Group failed
to respond to management's request for such support, a number of employees have
left the business and we understand FBMC may have slipped back into a loss
position in November.) This situation also suggests to us that the Whelchel
Group, first in failing to support FBMC and then in actively dismantling FBMC,
is acting much like the misguided investor who buys high and sells low.

We recognize that operating losses, even in the start-up phase of a
business, require prompt corrective action. Like any start-up business, FBMC had
to build an operating infrastructure before it had sufficient revenue to carry
the cost of that infrastructure by itself. This necessarily resulted in losses.
By mid-August 1996, FBMC had grown to a company of 40 employees and $1.5 million
in revenue, with approximately $45 million in mortgage volume. We recognized
prior to August that expenses were continuing to outstrip revenue, principally
because of the lack of volume. With the unanimous support of the Board
(including the Whelchel Group), we took action to restructure FBMC and
discontinue the warehouse lending operations. As noted above, FBMC seems to have
responded positively by moving to an apparent break even position in October.

While we do not minimize the importance of managing costs during the
start-up phase of an operation, we believe that the costs incurred by FBMC to
date have been reasonable in light of the benefits actually realized by the Bank
and the additional benefits that could have been derived by the shareholders
from a stand-alone mortgage banking operation. We believe that mortgage banking
is a natural line of diversification for the Company, building on the Bank as an
anchor. The Bank's customers often need mortgage credit, thereby constituting
one ready-made source of demand for FBMC's services. Mortgage banking also
offers the Company the opportunity to enter into the mortgage portfolio
servicing business, which would generate fee income and asset value. Mortgage
banking is also a line of business expected to grow in the Southeast, given the
area's continuing population increase.

While we understand that the Whelchel Group proposes to continue the
mortgage business as solely a brokerage business within the Bank, we do not
believe this is an adequate substitute for a standalone mortgage banking
subsidiary. First, we think it is unwise for the Bank itself to conduct mortgage
banking activities, because they entail greater risks than typical banking
activities. Second, it is more expensive to conduct mortgage banking within the
Bank because the Bank must operate under stricter reserve requirements than a
separate mortgage banking subsidiary. We believe that the reserve requirements
are such that certain lines of business conducted by FBMC (particularly
non-conforming mortgage wholesaling), would be impracticable for the Bank, given
the probable reserve requirements. Third, the Bank may be less effective than a
separate subsidiary in garnering mortgage business from other community banks,
because such other banks may be reluctant to direct their customers to another
bank, even for mortgage business which they do not offer. Lastly, we note that
to our knowledge, community banks seldom engage in some of the most attractive
aspects of mortgage banking, i.e., servicing and securitizing mortgage
portfolios. We think the Company is more likely to pursue those aspects of the
business if it is conducted through a free-standing subsidiary like FBMC. Indeed
this is why we established FBMC as a free-standing subsidiary in the first
place.

In addition, the Whelchel Group seems to misunderstand the nature of the
holding company's expenses. They assert that the holding company's expenses are
excessive, given the Company's size and position. Of the $650,000 in
non-interest expense at the holding company level through September 30, 1996,
$112,000 was incurred for shareholder reporting and for issuing restricted stock
compensation to all of the directors. Of the

B-2
<PAGE> 22

$538,000, over $380,000 consists of salaries, benefits and related taxes for the
ten individuals employed by the holding company. The increase in personnel
expense since 1995 is attributable to hiring a human resources executive, an
information systems executive and an internal auditor/compliance officer. If
these key personnel had not been hired, then non-interest holding company
expense through September 30, 1996 (excluding shareholder reporting and director
compensation costs) would be approximately $414,000, versus $441,000 for the
nine-month period through September 30, 1995, a decrease of approximately
$27,000 (6.1%), while during the same period the Company's assets grew
approximately $28 million, an increase of more than 38%.

This comparison suggests to us that non-interest expense at the holding
company generally has been kept well under control, but allowed to increase in
areas appropriate to the Company's growth, such as shareholder reporting and
executive personnel. (We assume the increase in director compensation is
considered appropriate by the Whelchel Group, which supported the issuance of
the restricted stock, as did we.) Shareholder reporting expenses have increased
because the Company nearly doubled the number of its shareholders from 1995 to
1996. New executives were hired in human resources, information systems and
compliance positions. We disagree with the notion that hiring personnel in these
positions is excessive. We think these executives are necessary to the proper
management of current operations, and to the growth of the Company and its
subsidiaries. Moreover, if the holding company were dissolved, the expenses for
shareholder reporting, director compensation, the new executives and the rest of
the holding company's personnel would be merely shifted back to the subsidiaries
(largely to the Bank, which has the bulk of employees and operations), producing
a reduction in the subsidiaries' profits, and resulting in no material effect on
consolidated results.

Our disagreement with the Whelchel Group goes beyond the issue of whether
losses and expenses are unacceptably high. We have repeatedly advised the
Whelchel Group that we believe FBMC's stand-alone mortgage banking business is
important to the Company's long-term strategy of being a diversified financial
services corporation, which strategy has been repeatedly communicated to the
shareholders. Noting that FBMC had apparently "turned the corner" on
profitability in October, we demanded that the Whelchel Group continue to
operate FBMC, at least until the shareholders have had the opportunity to
respond to the Whelchel Group's announcement of their decision to change the
Company's focus from diversified financial services to community banking. We
informed the Whelchel Group of our belief that it would be a waste of the
Company's assets to dismantle FBMC now, at a time when it is apparently about to
become profitable.

Nevertheless, in spite of our demands and over our dissenting votes, the
Whelchel Group decided, 5 to 2, at a Board meeting on December 9, 1996 to
dismantle FBMC and transfer a handful of its personnel to the Bank. (It is
unclear to us whether such Board meeting was properly called and therefore
whether such action was effective, as one member of the Whelchel Group did not
receive notice of the meeting.) The Whelchel Group had asked a consultant to
evaluate the Company's options with respect to FBMC. At the December 9 Board
meeting, the consultant presented in a preliminary report four options, one of
which was to dismantle FBMC and conduct a limited mortgage brokerage business
within the Bank. We were not given a copy of the preliminary report prior to the
meeting. Rather than deferring action until we had an adequate opportunity to
review and comment on the preliminary report (let alone receive a final report),
the Whelchel Group acted immediately to dismantle FBMC. The day after the Board
meeting, in writing, we again urged the Whelchel Group to defer action on FBMC.
The Whelchel Group has apparently rejected this request and has begun firing
FBMC employees. This action in disregard of the shareholders' best interests, as
we view them, has caused us to seek a Special Meeting of shareholders, at which
the shareholders can consider these issues and make such changes to the Board of
Directors and the Company's bylaws as are necessary to carry out the
shareholders' views. If you disagree, as we do, with the Whelchel Group's
actions and strategy, please review the attached proxy materials and fill out
the enclosed form to request a Special Meeting of the shareholders of the

Company.

B-3
<PAGE> 23

EXHIBIT C

THE JANUARY 7 LETTER
--------------------

Post Office Box 30297
Sea Island, Georgia 31561

<TABLE>
<S> <C>
TO: My Fellow Shareholders
FROM: Gregory S. Junkin
Golden Isles Financial Holdings, Inc. ("GIFH" or the
RE: "Company")
DATE: January 7, 1997
</TABLE>

I feel compelled to respond to the letter to you dated January 3, 1997,
from Messrs. L. McRee Harden, C. Kermit Keenum, Jimmy D. Veal, Michael D.
Hodges, Russell C. Jacobs, Jr. and J. Thomas Whelchel (collectively, the
"Whelchel Group"), which I will refer to as the "Current Whelchel Letter."
Unfortunately, the Current Whelchel Letter does not, as a reasonable investor
might expect, respond to any of the substantive issues about the nature or
future of your Company which Paul Lockyer and I addressed in the solicitation
materials we sent to you on December 23, 1996. Instead, the Whelchel Group has
resorted to a personal attack on me which is false, misleading, unfair and
mean-spirited. Indeed, I consider the Current Whelchel Letter to be libelous,
and I have instructed my attorneys to advise me on this point. I have also
instructed them to consider whether the Whelchel Group has violated the federal
securities laws because, in my view, the Current Whelchel Letter contains
material misstatements and omissions in connection with a proxy solicitation.

In assessing the credibility of the charges made against me in the Current
Whelchel Letter, and the credibility of the Whelchel Group itself, please keep
the following points in mind:

(a) THE CURRENT WHELCHEL LETTER IS INCONSISTENT WITH THE WHELCHEL
GROUP'S PRIOR WRITTEN STATEMENTS TO SHAREHOLDERS ABOUT THE REASONS
FOR MY REMOVAL FROM OFFICE AS CHIEF EXECUTIVE OFFICER OF THE
COMPANY. It denies the very real philosophical differences between
us and claims that I was removed for various alleged
improprieties. However, in his letter to shareholders dated
October 25, 1996, Mr. Whelchel stated: "Over the past two years,
management of the company deviated from the original mission of
providing banking and financial services to local communities." He
also stated in the October letter as follows: "The areas of
concern that prompted your Board of Directors to change management
are (1) losses in the First Bank Mortgage Corporation and (2) the
high costs associated with the holding company." These are
precisely the issues Mr. Lockyer and I address in our solicitation
materials. There is no mention of any charges against me in the
October letter or in the Whelchel Group's letter of December 3,
1996. The personal attacks against me were made only AFTER our
solicitation materials set forth detailed and reasoned arguments
rebutting the statements made in the earlier Whelchel letters.

(b) THE CURRENT WHELCHEL LETTER IS ALSO INCONSISTENT WITH OTHER
STATEMENTS MADE BY MR. WHELCHEL TO SHAREHOLDERS AND THEIR
REPRESENTATIVES. Mr. Leonard Golan, the largest GIFH shareholder,
spoke with Mr. Whelchel about my removal in October, soon after
receiving the first Whelchel letter. In that conversation, Mr.
Whelchel unequivocally told Mr. Golan that there were no charges
of impropriety or wrongdoing against me. Mr. Golan has told me he
is willing to sign an affidavit on this point. In a letter on
October 25, 1996 to an attorney for one of our shareholders who
asked about my removal, Mr. Whelchel stated: "The continuing
losses and the lack of confidence by the Company's Board in Mr.
Junkin and Mr. Lockyer to reverse these losses was [sic]what
precipitated this action." Again, there was no mention of any
alleged improprieties.

(c) THE CHARGES IN THE CURRENT WHELCHEL LETTER WERE NEVER MENTIONED TO
ME EITHER AT THE OCTOBER BOARD MEETING (AT WHICH I

C-1
<PAGE> 24

WAS REMOVED) OR ELSEWHERE, AND THE MINUTES OF THAT MEETING MAKE NO
MENTION OF THE CHARGES. The Whelchel Group never raised the charges
with me or gave me an opportunity to rebut them, before discussing
them in a public letter to the shareholders.

(d) THE WHELCHEL GROUP HAS A VESTED INTEREST IN MAKING THESE UNFOUNDED
CHARGES AFTER OUR CALL FOR A SPECIAL MEETING -- AVOIDING A SPECIAL
MEETING PRESERVES THEIR CONTROL OF GIFH. This is particularly true
for Messrs. Whelchel and Hodges who, by virtue of my removal and
that of Mr. Lockyer, have attained executive positions they
otherwise would not hold.

In addition to these basic points, I would like to address the specific
allegations of the Current Whelchel Letter.

MY HEALTH INSURANCE COVERAGE

The Current Whelchel Letter charges that I improperly caused GIFH to pay
for health insurance coverage for my secretary, my family and me. This is
perhaps the most outrageous and misleading charge of all. The Whelchel Group
fails to disclose that from 1987 until mid-1994, I devoted substantially all of
my working hours first to organizing GIFH and then serving as CEO, without
receiving any pay for nearly seven years. I was not a GIFH employee merely
because I voluntarily waived any salary, thereby saving the Company several
hundred thousand dollars. I personally paid my secretary, in order to save
additional money for GIFH, even though a significant part of her work was
Company-related. Further, in the Company's public stock offerings in 1990 and
1995, I personally raised over $3.5 million of the approximately $11 million
total raised and I spent hundreds of hours doing so. I neither charged nor
received any fees or commissions for my services, even though I was entitled to
do so. This saved the Company another several hundred thousand dollars in
commissions, which would have been payable if we had retained an investment
banking firm to underwrite the offerings.

I was willing to do all of this for the Company's benefit, but I did at
least want to receive health insurance coverage for my family and my secretary.
That coverage (from 1990-94) was the only compensation I received for my
services for seven years. I do not think that was unreasonable or improper, and
I doubt that any of you do. The Whelchel Group is fully aware of all these
facts, yet they have made it appear that I took an excessive and unjustifiable
benefit for myself. I find this disgraceful.

ACTION BY BANK REGULATORS

The claim that the banking regulators have confirmed the propriety of my
removal is entirely FALSE. The regulators accelerated their audit because of the
change in management, not to endorse that change. The regulators have informed
both the Whelchel Group and me that they are neutral in the dispute between us.
Their main purpose is to insure the safety and soundness of the financial
institutions under their jurisdiction.

The Board resolutions referred to in the Current Whelchel Letter do not
evidence the accuracy of any of the Whelchel's Group's charges against me or Mr.
Lockyer or the propriety of my removal. In fact, Mr. Lockyer and I voted in
favor of these resolutions, in part because of our concerns about the lack of
competence of current management.

Finally, the disclosure of these resolutions by the Whelchel Group
constitutes a serious breach of confidentiality, which was required by the
regulators. At their request, the Board adopted resolutions at the same meeting
which prohibited those attending the meeting, including directors, " . . . from
disclosing or making public in any manner the nature or conduct of the
proceedings at this meeting, or the contents of the documents presented to the
Board of Directors at this meeting." I doubt that the regulators will be pleased
to learn that the Whelchel Group has violated the required confidentiality.

C-2
<PAGE> 25

CONCEPT DESIGNS, INC. ("CDI")

The Current Whelchel Letter fails to state that Mr. Lockyer, not I,
retained CDI in January 1995 to do the space planning and interior design of our
new St. Simons Island branch. While it is true that I have a social relationship
with one of the partners of CDI, I did not meet the partners of the firm until
months after the firm had been retained by Mr. Lockyer. Therefore, my
relationship with this individual could not have played any role in the decision
to retain CDI (as the Current Whelchel Letter implies).

Mr. Lockyer's decision to retain CDI was well-considered. The firm is
headquartered on St. Simons Island. It had experience in designing 12 banks in
the Southeast, as well as the Radisson Hotel on Jekyll Island, Georgia and
several other hotels. The firm's commercial experience totaled more than 800,000
square feet. It had done design work locally for Coastal Bank (including a
branch in Kingsland, Georgia) and Frederica Bank. Currently, CDI is designing
the interior of Barnett Bank's new St. Simons Island branch. It was Mr.
Lockyer's opinion that CDI was the most experienced design firm locally for our
needs.

The Current Whelchel Letter is also misleading in stating that the Company
paid CDI approximately $845,000 just for furniture and decorating. The gross
amount billed through CDI took place over 22 months and included work done for 6
separate Company facilities totaling approximately 30,000 square feet. The vast
majority of these billings included pass-through charges from other vendors for
millwork, signage, painting, labor, installation, furnishings, accessories,
draperies, wall coverings, and sales taxes, in addition to fees for design
consultation, project management and space planning. The net fees to CDI just
for its services were only a fraction of the figure cited by the Whelchel Group.

THE FIRST BANK MORTGAGE CORPORATION ("FBMC") LEASE

The Current Whelchel Letter is also misleading and inaccurate in its
statements about this lease. FBMC's space at the branch bank was not built
exclusively for FBMC. In fact, from the outset we anticipated that, within
eighteen months, FBMC would outgrow the space and that the Bank would need the
space to accommodate its own growth. When FBMC moved out of the Bank space, it
had 30 employees working in 3,500 square feet (an average of only 116 sq.ft. per
person). This was entirely inadequate for a proper work environment. Several of
the directors were informed in March and April 1996 that a move was in the
works. None voiced any opposition then. Whether I should have sought formal
board approval for the lease is an issue about which reasonable people could
differ. At the time, I did not consider a commitment of $8,000 per month for two
years to be material, given FBMC's then-critical need for space.

MR. LOCKYER'S SUPPORT OF ME

Mr. Lockyer categorically denies the assertion that he expressed any
support for my removal. In fact, he cast his vote against my removal. His
support of me has been steadfast and continuous.

GIFH PURCHASE OF MY FURNITURE

The Company did pay my former partners and me $14,000 for furniture located
and used in the Company headquarters building. This may sound like a lot of
money. However, the Whelchel Group again gives you only part of the story. They
fail to disclose that the furniture included first quality desks, credenzas,
chairs, etc. for seven executive offices (an average of only $2,000 per office).
They also fail to disclose that for several years I had provided a portion of
this furniture for GIFH use at no charge. Contrary to the Whelchel Group's
assertions, it is my recollection that the furniture purchase was fully
disclosed to the board in connection with the purchase of the headquarters
building, which occurred at the same time. My former partners and I sold the
headquarters building to the Company, with full board approval, for
approximately $250,000 less than our original cost and at slightly less than the
appraised value. The Whelchel Group has conveniently failed to disclose to you
that the purchase terms were to the Company's benefit, not mine. As for the
current whereabouts of the furniture, I can only say that it was in the
headquarters building at the time of my removal.

C-3
<PAGE> 26

EXPENSE REPORTS

Mr. Lockyer and I did approve each other's expense reports. However, from
time to time the reports were also approved by other Company officers, either
Mr. Whelchel or Mr. Veal.

Without access to the Company's records, I cannot confirm the exact amount
of reimbursements made to me in 1995 and 1996. However, I am confident that
every claim for reimbursement was for a legitimate expense incurred by me on
behalf of the Company. Furthermore, a portion of the expenses referred to by the
Whelchel Group was incurred in connection with our successful public offering,
which raised nearly $6 million in equity capital for GIFH. For the offering I
traveled not only to Arizona, but also to California, Illinois, Connecticut,
Florida and throughout Georgia. I met with prospective investors and prospective
market makers, including some people who ultimately chose not to invest or do
business with the Company. The fact that some contacts were unsuccessful does
not mean the expenses were not legitimately incurred. Indeed, I believe that if
there were truly a problem with my expense reimbursements, it could have been
detected during the Company's audit for 1995.

In considering the Whelchel Group's allegations of improper expense
reimbursements and other improprieties, please keep the following points in
mind:

1. From 1987 until 1989, I incurred more than $35,000 in expenses in
organizing GIFH and obtaining a charter for the Bank. I did not seek
reimbursement, and was not reimbursed, for any of these expenses.

2. From 1987 until mid-1994, I did not receive a salary for first
organizing GIFH and then serving as CEO.

3. From 1987 until 1996, I provided my own office space and various
furniture for GIFH at no charge.

I do not think that these are the actions of a man who cheats on his
expense reports.

CREDIT LINE TO ARKANSAS COMPANY

During 1995 and 1996 FBMC provided warehouse lines of credit to a variety
of mortgage companies. These lines enabled certain of FBMC's institutional
customers to "warehouse" mortgage loans temporarily with FBMC until the loans
were sold to investors. Every loan funded through these lines was secured by
various pieces of residential real estate. Thus, there was underlying collateral
which could be sold in the event of a default. One company for which credit was
provided has had difficulty in selling certain loans secured by rural property.
In fact, approximately 75% of this company's line was repaid at the time of my
removal. I expect the remainder of this line will ultimately be repaid as the
remaining collateral is sold to investors. It is very important for you to know
that the board of GIFH set up a committee to approve these credit lines and that
two members of the Whelchel Group sat on the approval committee. How could these
directors possibly disclaim knowledge of the warehouse business, its collateral
and the risks associated therewith? One member of the Whelchel Group actually
served as Secretary of FBMC throughout 1996 and signed most corporate documents.

AUDIT COMMITTEE ISSUES

I never prepared an agenda for Audit Committee meetings. I did, however,
suggest to the two committee chairmen, Messrs. Jacobs and Harden, that they keep
their meetings on track because of Mr. Whelchel's reported inability to focus
the discussion on the proper subject matter of the committee. I also asked our
Internal Auditor to work with the committee chairmen on this matter.

C-4
<PAGE> 27

1996 SHAREHOLDERS MEETING

At the annual shareholders meeting in May 1996, I advised those attending
that it was my hope that FBMC would deliver pre-tax profits in the range of
$250,000, not $500,000. As I have previously indicated, I was displeased with
FBMC results through July and therefore prepared a restructuring plan which, as
executed, reportedly created a profit in October, 1996.

KEEPING THE BOARD INFORMED

From June 1990 to October 1996 one or more of the Company's boards met
almost monthly. The Whelchel Group continues to plead ignorance about all
matters, financial matters included, concerning the Company. It is important to
remember that financial statements were provided to all directors at each
regularly scheduled monthly meeting or shortly thereafter. These statements
contained ALL revenue, expense and balance sheet items. Additionally, audited
financial statements were prepared annually. Furthermore, everyone was
encouraged to ask questions and to meet with me and/or Mr. Lockyer at any time
to discuss Company business, results, new ideas to create revenues, etc. Sadly,
only two members of the Whelchel Group availed themselves of these offers and
did so only on a limited basis over the years. Every board member was advised
that any and all Company records or material were available for review and
discussion. One must question how the Whelchel Group could claim they were
uninformed when we clearly had an open door policy.

I trust that you are as outraged as I am by the misstatements and omissions
in the Current Whelchel Letter, and its apparent attempt to damage my reputation
in an effort to retain control of GIFH. If you are, please let the Whelchel
Group know.

Once again, I ask that you take the opportunity, if you have not already
done so, to request the special meeting of shareholders, by marking your card
"Requested" and returning it to me as soon as possible. I look forward to seeing
you at the special meeting of shareholders, at which I welcome the opportunity
to answer in public and in detail any questions you may have about any of these
or other matters and to debate each of the members of the Whelchel Group about
the direction of your Company. In the meantime, if you have any questions,
please feel free to call me or Mr. Lockyer.

Very truly yours,

Gregory S. Junkin

C-5
<PAGE> 28

If your Shares are held in the name of a brokerage firm, bank or bank
nominee, only it can execute a GREEN proxy card with respect to your Shares and
only upon your specific instructions. Accordingly, please contact the persons
responsible for your account and instruct them to execute the GREEN proxy card.

THE REQUESTING PARTIES STRONGLY URGE YOU TO SIGN, DATE AND RETURN THE
ENCLOSED GREEN PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE TO VOTE FOR
PROPOSAL A, PROPOSAL B AND THE PROPOSAL RELATING TO CHAIRMANSHIP OF THE SPECIAL
MEETING.

Questions and requests for assistance in completing or delivering Proxy
cards may be directed to Mr. Junkin or Mr. Lockyer at the following addresses
and telephone numbers:

<TABLE>
<S> <C>
Gregory S. Junkin Paul D. Lockyer
P.O. Box 30297 311 Dunbarton Drive
Sea Island, Georgia 31561 St. Simons Island, Georgia 31522
(912) 638-4447 (912) 638-2381
</TABLE>
<PAGE> 29

PROXY SOLICITATION
GOLDEN ISLES FINANCIAL HOLDINGS, INC.
THIS REVOCABLE PROXY IS SOLICITED BY GREGORY S. JUNKIN, PAUL D. LOCKYER, SCOTT
A. JUNKIN

The undersigned shareholder of Golden Isles Financial Holdings, Inc. (the
"Company") hereby appoints Gregory S. Junkin, Paul D. Lockyer and Scott A.
Junkin, and each of them, proxies with full power of substitution and
resubstitution, for and in the name of the undersigned (the "Proxies"), to vote
all shares of Common Stock of the Company that the undersigned is entitled to
vote if personally present at the Special Meeting of Shareholders of the Company
to be held on March 11, 1997 at the Embassy Suites Hotel at 10 a.m. at 500 Mall
Boulevard, Brunswick, Georgia 31525 and at any adjournment or postponement
thereof. The undersigned hereby revokes any previous proxies with respect to the
matters covered by this Proxy.

GREGORY S. JUNKIN, SCOTT A. JUNKIN AND PAUL D. LOCKYER PROPOSE AND RECOMMEND A
VOTE "FOR" EACH OF THE PROPOSALS SET FORTH BELOW, INCLUDING EACH PROPOSAL SET
FORTH UNDER PROPOSAL A AND PROPOSAL B.

(Please mark each proposal with an "X" in the appropriate box)

PROPOSAL A:
1. To fix the number of directors at six. FOR [ ] AGAINST [ ]
ABSTAIN [ ]

2. To remove Messrs. J. Thomas Whelchel, Michael D. Hodges, C. Kermit Keenum
and L. McRee Harden and all other persons serving as members of the Board
of Directors of the Company as of the date of the Special Meeting (the
"Opposing Members") except Mr. Junkin, Mr. Lockyer, Mr. Russell C. Jacobs,
Jr. and Mr. Jimmy D. Veal. FOR [ ] AGAINST [ ] ABSTAIN [ ]

3. To amend Article 3, Section 3.6 of the bylaws of the Company to clarify
that the shareholders of the Company shall have the right to fill a
vacancy on the Board of Directors of the Company (created by the removal
of a director) at a special meeting or an annual meeting by inserting the
following sentence at the end of Section 3.6:

4. To elect Messrs. Richard S. Holson, Jr. and James M. Showalter
(collectively, the "Proposal A Nominees") as directors.

FOR all Proposal A Nominees [ ] WITHHOLD AUTHORITY for all Proposal A
Nominees [ ]

(INSTRUCTION: To withhold authority to vote for one or more nominees, mark
FOR above and print the name(s) of the person(s) with respect to whom you wish
to withhold authority in the space provided on the reverse side.)

PROPOSAL B:

If Proposal A is not adopted in its entirety, Proposal B will be proposed by
the Requesting Parties to the shareholders of the Company.

1. To fix the number of directors at thirteen. FOR [ ] AGAINST [ ]
ABSTAIN [ ]

2. To elect Messrs. Edward V. Baich, John M. Froehlich, Frank J. Guzikowski,
Richard S. Holson, Jr. and James M. Showalter (collectively, the "Proposal
B Nominees") as directors.

FOR all Proposal B Nominees [ ] WITHHOLD AUTHORITY for all Proposal B
Nominees [ ]

(INSTRUCTION: To withhold authority to vote for one or more of the Proposal A
Nominees or the Proposal B Nominees, or to withhold authority to remove one or
more of the Opposing Members, mark FOR above and print the name(s) of the
person(s) with respect to whom you wish to withhold authority in the space
provided on the reverse side.)

(Continued and to be dated and signed on the reverse side)

(Continued from front)

PROPOSAL AS TO CHAIRMAN OF THE SPECIAL MEETING:

GREGORY S. JUNKIN, SCOTT A. JUNKIN AND PAUL D. LOCKYER RECOMMEND A VOTE "FOR"
THE ELECTION OF GREGORY S. JUNKIN OR, IN HIS ABSENCE, PAUL D. LOCKYER AS THE
CHAIRMAN OF THE SPECIAL MEETING.

To elect Gregory S. Junkin, or, in his absence, Paul D. Lockyer as the Chairman
of the Special Meeting.

FOR Mr. Gregory S. Junkin, or, in his absence, Paul D. Lockyer, as Chairman of
the Special Meeting [ ] WITHHOLD AUTHORITY [ ]

IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER MARKED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO MARKING IS MADE, THIS PROXY WILL BE DEEMED TO
BE A DIRECTION TO VOTE FOR THE FOREGOING PROPOSALS IN THEIR ENTIRETY.

GREGORY S. JUNKIN, PAUL D. LOCKYER AND SCOTT A. JUNKIN STRONGLY RECOMMEND THAT
YOU VOTE "FOR" THE PRECEDING ACTIONS.

Please sign exactly as your name appears on your stock certificate. When
shares are held by joint tenants, both should sign. When signing as an attorney,
executor, administrator, trustee or guardian, give full title as such.

If a corporation, sign in full
corporate name by president or
other authorized officer. If a
partnership, sign in
partnership name by authorized
person.

Dated:_____________, 199_____
______________________________
Signature
______________________________
Signature (if jointly held)
______________________________
Title:

PLEASE SIGN, DATE AND MAIL PROMPTLY IN THE POSTAGE-PAID ENVELOPE ENCLOSED.