Exhibit 10.1

SEPARATION AGREEMENT

THIS SEPARATION AGREEMENT (this “Agreement”) is entered into as of April 11,
2011, by and between William S. McCalmont (the “Executive”) and The St. Joe
Company, a Florida corporation (the “Company”).

WHEREAS, the Company and the Executive (the “Parties”) have entered into an
Employment Agreement dated as of May 10, 2007, as amended (the “Employment
Agreement”);

WHEREAS, the Executive currently serves as Executive Vice President and Chief
Financial Officer of the Company; and

WHEREAS, the Company has elected to terminate the Executive’s employment other
than for “Cause” (as defined in the Employment Agreement) effective as of
May 20, 2011 (the “Termination Date”).

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the Company and the Executive hereby
agree as follows:

1. Definitions

“Affiliate” means, with respect to any Person, any other Person controlling,
controlled by, or under direct or indirect common control with such Person. For
the purposes of this definition “control”, when used with respect to any
specified Person, shall mean the power to direct the management and policies of
such Person, directly or indirectly, whether through ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled by” shall have the meanings correlative to the foregoing.

“Code” means the Internal Revenue Code of 1986, as amended.

“Person” means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association
or joint venture.

2. Termination of Employment

2.1 The Executive’s employment by the Company, and any and all titles, positions
and appointments the Executive holds with the Company and its Affiliates,
whether as an officer or employee (including, without limitation, as Executive
Vice President and Chief Financial Officer) shall cease as of the Termination
Date.

2.2 As of the Termination Date, the Executive shall also have a “separation from
service” with the Company within the meaning of Code Section 409A and the
regulations thereunder, and notwithstanding anything in this Agreement to the
contrary, he shall have no duties or responsibilities after the Termination Date
that are inconsistent with having had such a separation from service as of the
Termination Date.

3. Compensation and Other Benefits

3.1 The Executive shall continue to receive his annual base salary, at the
annual rate of $418,000 per annum (“Base Salary”), for his employment through
the Termination Date, in accordance with the Company’s regular payroll practices
for its senior executives, as in effect from time to time.

3.2 The Company shall also provide the following payments and benefits to the
Executive:

(a) pay to the Executive, in a cash lump sum on the first business day following
the end of the six month period following the Termination Date, an amount equal
to $1,463,000;

(b) pay to the Executive a pro rata portion of any annual bonus the Executive
would have earned in 2011 (based on the period from January 1, 2011 through the
Termination Date, divided by 365) if the Executive had remained employed for the
full calendar year and subject to attainment of the applicable performance
conditions for the full calendar year, payable at the same time the Company pays
other executive bonuses for calendar year 2011, but no later than March 15,
2012;

(c) pay to the Executive $306,696 on the first business day following the end of
the six month period following the Termination Date;

(d) provided that Executive elects to continue his and his family’s medical and
dental insurance under COBRA, pay Executive’s COBRA premium for the lesser of
eighteen (18) months following the Termination Date or the date on which the
Executive becomes ineligible for COBRA continuation coverage. The Executive
shall be responsible to reimburse the Company, on a monthly basis, for an amount
equal to the employee contribution that would be required of an employee
participating in the medical and dental insurance plan, as in effect from
time-to-time (the “Employee Contribution”). If, at the end of the eighteen
(18) month period, the Executive has not become eligible for coverage under the
healthcare insurance plan or another employer, the Company shall pay to the
Executive, on the first business day that is at least eighteen (18) months after
the Termination Date, in a single lump sum, an amount equal to the monthly
premium for the period beginning at the end of the eighteen (18) month period
through March 3, 2013 for medical and dental insurance coverage providing
substantially the same benefits as the medical and dental insurance coverage
provided to the Executive and his family under COBRA as in effect at the end of
the eighteen (18) month period, less an amount equal to the Employee
Contribution for such period. Provided that the Executive elects to convert the
basic life and disability insurance policies, the Company will pay the premiums
for those policies for a period beginning on the Termination Date and continuing
until March 3, 2013. The Company will continue to provide any supplemental life
or disability insurance benefit in effect as of the Effective Date for a period
beginning on the Termination Date and continuing until March 3, 2013;

(e) pay up to $20,000 as reimbursement for outplacement services, upon the
Executive’s presentation to the Company of proper documentation supporting
expenditures for outplacement services during the 18 months period following the
Termination Date; and

(f) If any payments to the Executive or on the Executive’s behalf under this
Section 3.2 are due prior to the expiration of the revocation period of the
releases described in Section 4.1 of this Agreement, such payments shall be made
on the first business day following the end of the revocation period; provided,
however, that if such payments are required to be made to a third party, the
Executive shall be responsible to make such payments in a timely manner and the
Executive will be reimbursed by the Company.

3.3 Return of Payments. Anything in this Agreement to the contrary
notwithstanding, all payments and benefits to the Executive under
Sections 3.2(a) through (e) shall be returned to the Company promptly if the
Executive breaches his obligations under Sections 5.1, 5.6, and 5.7 of this
Agreement (the “Restrictions”) within two years after the Termination Date.
Until such Restrictions are completely satisfied, the Executive shall be a
constructive trustee of such payments and benefits. In addition, all payments
and benefits to the Executive under Sections 3.2(a) through (e) shall remain
subject to recoupment by the Company to the extent required under the
Sarbanes-Oxley Act of 2002 and/or the Dodd-Frank Act.

4. Effect of Termination

4.1 Release.

(a) General Release. In consideration of the payments and benefits under this
Agreement, with the intention of binding the Executive and the Executive’s
heirs, executors, administrators and assigns, the Executive does hereby release,
remise, acquit and forever discharge the Company and each of its Affiliates (the
“Company Affiliated Group”), and in their capacity as such, their present and
former officers, directors, executives, agents, attorneys, employees and
employee benefits plans (and the fiduciaries thereof), and the successors,
predecessors and assigns of each of the foregoing (collectively, the “Company
Released Parties”), of and from any and all claims, actions, causes of action,
complaints, charges, demands, rights, damages, debts, sums of money, accounts,
financial obligations, suits, expenses, attorneys’ fees and liabilities of
whatever kind or nature in law, equity or otherwise, whether accrued, absolute,
contingent, unliquidated or otherwise and whether now known or unknown,
suspected or unsuspected which the Executive, individually or as a member of a
class, now has, owns or holds, or has at any time heretofore had, owned or held,
against any of the Company Released Parties in any capacity, including, without
limitation, any and all claims (i) arising out of or in any way connected with
the Executive’s service to any member of the Company Affiliated Group (or the
predecessors thereof) in any capacity, or the termination of such service in any
such capacity, (ii) for severance or vacation benefits, unpaid wages, salary or
incentive payments, (iii) for breach of contract, wrongful discharge, impairment
of economic opportunity, defamation, intentional infliction of emotional harm or
other tort, and (iv) for any violation of applicable state and local labor and
employment laws (including, without limitation, all laws concerning unlawful and
unfair labor and employment practices), any and all claims based on the
Executive Retirement Income Security Act of 1974 (“ERISA”), any and all claims
arising under the civil rights laws of any federal, state or local jurisdiction,
including, without limitation, Title VII of the Civil Rights Act of 1964 (“Title
VII”), the Americans with Disabilities Act (“ADA”), Sections 503 and 504 of the
Rehabilitation Act, the Family and Medical Leave Act, the Age Discrimination in
Employment Act (“ADEA”), the Florida Law Against Discrimination and any and all
claims under any whistleblower laws or whistleblower provisions of other laws
excepting only:

  (i)   rights of the Executive under this Agreement;

  (ii)   rights of the Executive relating to equity awards held by the Executive
as of the Termination Date;

  (iii)   the right of the Executive to receive COBRA continuation coverage in
accordance with applicable law;

  (iv)   claims (A) for benefits under any health, disability, retirement,
deferred compensation, life insurance or other similar employee benefit plan or
arrangement of the Company Affiliated Group and (B) for earned but unused
vacation pay through the Termination Date in accordance with applicable Company
policy; and

  (v)   claims for the reimbursement of unreimbursed business expenses incurred
prior to the Termination Date pursuant to applicable Company policy.

(b) No Admissions. The Executive acknowledges and agrees that the provisions of
this Section 4.1 are not to be construed in any way as an admission of any
liability whatsoever by any Company Released Party, any such liability being
expressly denied.

(c) Application to all Forms of Relief. This Section 4.1 applies to any relief
no matter how called, including, without limitation, wages, back pay, front pay,
compensatory damages, liquidated damages, punitive damages for pain or
suffering, costs and attorney’s fees and expenses.

(d) Specific Waiver. The Executive specifically acknowledges that his or her

acceptance of the terms of this Agreement, including the provisions of this
Section 4.1, are, among other things, a specific waiver of his or her rights,
claims and causes of action under Title VII, ADEA, ADA and any state or local
law or regulation in respect of discrimination of any kind; provided, however,
that nothing herein shall be deemed, nor does anything herein purport, to be a
waiver of any right or claim or cause of action which by law the Executive is
not permitted to waive.

(e) No Complaints or Other Claims. The Executive acknowledges and agrees that he
or she has not, with respect to any transaction or state of facts existing prior
to the date hereof, filed any complaints, charges or lawsuits against any
Company Released Party with any governmental agency, court or tribunal.

(f) No Representation. The Executive acknowledges that, other than as set forth
in this Agreement, (i) no promises have been made to the Executive and (ii) in
signing this Agreement the Executive is not relying upon any statement or
representation made by or on behalf of any Company Released Party and each or
any of them concerning the merits of any claims or the nature, amount, extent or
duration of any damages relating to any claims or the amount of any money,
benefits, or compensation due the Executive or claimed by the Executive, or
concerning this Section 4.1 or concerning any other thing or matter.

(g) Injunctive Relief. In the event of a breach or threatened breach by the
Executive of this Section 4.1, the Executive agrees that the Company shall be
entitled to injunctive relief in a court of appropriate jurisdiction to remedy
any such breach or threatened breach, the Executive acknowledging that damages
would be inadequate or insufficient.

(h) Voluntariness. The Executive agrees that he or she is relying solely upon
his or her own judgment; that the Executive is over 18 years of age and is
legally competent to sign this Agreement; that the Executive is signing this
Agreement of his or her own free will; that the Executive has read and
understood the Agreement before signing it; and that the Executive is signing
this Agreement in exchange for consideration that he or she believes is
satisfactory and adequate.

(i) Legal Counsel. The Executive acknowledges that he or she has been informed
of the right to consult with legal counsel and has been encouraged to do so.

(j) Acceptance. The Executive acknowledges that he or she has been given a
period of 21 days within which to consider this Agreement, unless applicable law
requires a longer period, in which case the Executive shall be advised of such
longer period and such longer period shall apply. The Executive may accept this
Agreement at any time within this period of time by signing the Agreement and
returning it to the Company.

(k) Revocability. This Agreement shall not become effective or enforceable until
seven calendar days after the Executive signs it (the “Effective Date”). The
Executive may revoke his or her acceptance of this Agreement at any time within
that seven calendar day period by sending written notice to the Company. Such
notice must be received by the Company within the seven calendar day period in
order to be effective and, if so received, would void this Agreement for all
purposes.

(l) Re-Execution. The Executive agrees to re-execute this Agreement as of the
Termination Date solely with respect to this Section 4.1. If the Executive fails
to timely re-execute this Agreement, the Company shall not be obligated to
provide any of the payments and/or benefits set forth in Section 3.2(a) through
(e).

4.2 Mutual Non-Disparagement. The Company and the Executive each agree that they
will not make any intentionally negative or disparaging comments about the
other, except as permitted under Section 4.4 of this Agreement.

4.3 Return of Property. On or before the Termination Date, the Executive shall
return to the Company all of the Company’s property of which he or she is in
possession, including, without limitation, any material and documentation that
constitutes Confidential Information, credit cards, computers, and keys.

4.4 Permissible Disclosures. Notwithstanding anything in this Agreement or
elsewhere to the contrary, nothing shall preclude the Executive or the Company
from making truthful statements, or from disclosing documents or information,
(A) when required by applicable law, regulation, order, or the like, (B) in
connection with any proceeding to enforce the terms of this Agreement, or (C) in
confidence to any professional for the purpose of securing professional advice.

5. Executive’s Commitment to the Company

5.1 Confidentiality. The Executive shall not, prior to and for two years after
the Termination Date (and for an indefinite period for Confidential Information
composed of trade secrets of the Company), disclose any Confidential Information
to any Person for any reason or purpose whatsoever, other than in connection
with the performance of the Executive’s duties under this Agreement. The term
“Confidential Information” shall mean all confidential information of or
relating to the Company and any of its Affiliates, including, without
limitation, financial information and data business plans and information
regarding prospects and opportunities, but does not include any information that
is or becomes public knowledge by means other than the Executive’s breach or
nonobservance of the Executive’s obligations described in this Section 5.1.
Notwithstanding the foregoing, the Executive may disclose such Confidential
Information as he or she may be legally required to do so on the advice of
counsel in connection with any legal or regulatory proceeding; provided,
however, that the Executive shall provide the Company with prior written notice
of any such required or potentially required disclosure and shall cooperate with
the Company and use his or her best efforts under such circumstances to obtain
appropriate confidential treatment of any such Confidential Information that may
be so required to be disclosed in connection with any such legal or regulatory
proceeding.

5.2 Consulting Arrangement and Cooperation. The Executive agrees that he, as an
independent contractor and not as an employee, shall be available during normal
business hours to provide consulting and transition services (“Consulting
Services”) to the Company, at its request, for a period of six (6) months
following the Termination Date (the “Consulting Period”), in exchange for a
service fee of eight thousand dollars ($8,000) per month during the Consulting
Period, payable monthly in arrears and pro-rated for any partial month during
the Consulting Period; provided, however, that the Consulting Services shall not
exceed over the course of the Consulting Period twenty percent (20%) of the
average level of services performed by the Executive during the immediately
preceding thirty-six (36) month period. The Executive may terminate the
Consulting Services prior to the expiration of the Consulting Period upon sixty
(60) days written notice to the Company and the Company may terminate the
Consulting Services prior to the expiration of the Consulting Period upon thirty
(30) days written notice to the Executive. If the Consulting Services are
terminated by the Executive prior to the expiration of the Consulting Period,
the Executive agrees, as a condition of this Agreement, to continue to
reasonable cooperate until the date that is six (6) months following the
Termination Date with the Company and its Affiliates and their respective
directors, officers, attorneys and experts in all matters relating to the
Executive’s prior work on behalf of the Company and the orderly transfer of any
such work to other employees of the Company as may be designated by the Company.

5.3 Litigation. The Executive agrees to cooperate fully with the Company, or its
assignee, and counsel for the Company, or its assignee, in any and all matters
involving litigation, administrative proceedings, arbitration or governmental
investigations other than in matters in which the dispute is solely between the
Executive and the Company. The Executive’s cooperation shall include being
reasonably available for, without limitation, interviews, depositions, and trial
testimony. To the extent that the Executive’s cooperation involves travel, the
Company or its assignee will reimburse the Executive for reasonable travel
expenses. To the extent that the Executive’s cooperation requires him or her to
incur out-of-pocket expenses, including without limitation, reasonable
attorney’s fees, the Company or its assignee will reimburse such expenses,
provided they are reasonable and supported by reasonable documentation. The
Executive will make available, at the expense of the Company or its assignee,
copies of all documents and files requested by the Company in connection with
this duty of cooperation, excluding only those documents and files which are
subject to any attorney-client privilege, work product doctrine, or other legal
protection from disclosure that is held solely by the Executive in his or her
individual capacity, as opposed to any privilege or legal protection from
disclosure held by the Company.

5.4 Compliance with Securities Laws. The Executive agrees not to directly or
indirectly buy or sell the Company’s stock or other securities as long as he or
she possesses “material non-public information” as that term is defined by
interpretations of the Securities Exchange Act of 1934, as amended, and the
rules and regulations thereunder. Without limiting the generality of the
foregoing, the Executive further agrees to abide by the Company’s insider
trading policy as in effect on the Effective Date until two business days after
the public release of the financial results for the fiscal quarter in which the
Termination Date occurs.

5.5 Other Positions. The Executive shall resign as of the Termination Date from
any administrative roles in any agreements sponsored by the Company and its
Affiliates and will execute all instruments and documents requested by the
Company to effectuate this and the termination of employment and of other duties
and positions as described in Section 2.1 of this Agreement.

5.6 Non-Compete. The Executive agrees not to directly or indirectly compete with
the business of the Company and its successors and assigns for a period of one
year following the Termination Date. The term “not compete” as used herein shall
mean that the Executive shall not own, manage, operate, consult or be an
executive in any business or legal entity that is in the commercial, hotel
and/or residential real estate development business that competes with the
Company or any of its Affiliates anywhere in Florida or Georgia. Notwithstanding
the foregoing, the Executive may own up to 5% of any stock or security that is
publicly traded on any national securities exchange or other market system.
“Compete” shall be defined as engaging in commercial, hotel and/or residential
real estate development projects where total annual development costs for all
such projects in Florida and/or Georgia meet or exceed $50,000,000. The Company
and the Executive acknowledge the reasonableness of this covenant not to compete
and the reasonableness of the geographic area and duration of time which are a
part of said covenant. This covenant not to compete is contemplated to protect
the Company’s legitimate business interests. Notwithstanding the foregoing, the
Executive’s position as a director of LaSalle Hotel Properties will not violate
the terms of this provision.

5.7 Non-Solicitation. The Executive agrees, for a period of one year from the
Termination Date, that the Executive will not, without the prior written
approval of the Company, directly or indirectly: (i) solicit for hire any
employees of the Company or any Affiliate, or (ii) induce any employee of the
Company or any Affiliate to terminate their relationship with the Company or
Affiliate. The foregoing will not apply to individuals hired as a result of the
use of an independent employment agency (so long as the agency was not directed
to solicit a particular individual) or as a result of the use of a general
solicitation not specifically directed to the Company or its Affiliate’s
employees.

5.8 Injunctive Relief. The Executive acknowledges and agrees that the Company
will have no adequate remedy at law, and would be irreparably harmed, if the
Executive breaches or threatens to breach any of the provisions of this
Section 5. The Executive agrees that the Company shall be entitled to equitable
and/or injunctive relief to prevent any breach or threatened breach of this
Section 5, and to specific performance of each of the terms of this Section 5 in
addition to any other legal or equitable remedies that the Company may have,
including those set forth in Section 3.3. The Executive further agrees that he
shall not, in any equity proceeding relating to the enforcement of the terms of
this Section 5, raise the defense that the Company has an adequate remedy at
law.

5.9 Special Severability. The terms and provisions of this Section 5 are
intended to be separate and divisible provisions and if, for any reason, any one
or more of them is held to be invalid or unenforceable, neither the validity nor
the enforceability of any other provision of this Agreement shall thereby be
affected. Furthermore to the extent any term or provision of this Section 5
would be declared invalid due to its duration, geographic scope or other term,
it is the intent of the parties that the duration, geographic scope or other
term be reformed to conform to the fullest extent that would be enforceable, and
that the term or provision be so enforced.

6. Successors

6.1 The Executive. This Agreement is personal to the Executive and, without the
prior written consent of the Company, shall not be assignable by the Executive,
other than by will or the laws of descent and distribution or as described in
this Section 6.1. This Agreement shall inure to the benefit of and be
enforceable by the Executive’s heirs, beneficiaries and/or legal
representatives.

6.2 The Company. This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns.

6.3 Successors. The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place, and the Executive will consent to such successor’s assumption.
As used in this Agreement, “Company” shall mean the Company as previously
defined and any successor to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law or otherwise.

7. Additional Payments

7.1 Excise Tax Payments. Anything in this Agreement or any other plan, program,
governance document, agreement, or arrangement of the Company or any of its
Affiliates (each a “Company Arrangement”; collectively, “Company Arrangements”)
to the contrary notwithstanding, to the extent that any payment, distribution or
acceleration of vesting to or for the benefit of the Executive, whether paid,
distributed or vested pursuant to this Agreement or otherwise (a “Payment”), is
or will be subject to the excise tax imposed by Section 4999 of the Code, or any
interest or penalties are incurred by the Executive with respect to such excise
tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the “Excise Tax”), the Executive shall
be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount
such that after payment by the Executive of all taxes (including any interest or
penalties imposed with respect to such taxes), including, without limitation,
any income taxes and Excise Tax imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments. The Company will attempt to minimize any Excise Tax, provided
however, that no such minimization attempts shall include any acceleration of
any payments, and provided further that if the Payments result in an Excise Tax
and reducing the Payments eliminates the Excise Tax, then the Executive agrees
to reduce the Payments (by up to 10%, and by first reducing or eliminating the
portion of the Payments which are payable in cash and then by reducing non-cash
Payments) until they do not trigger an Excise Tax. If any Excise Tax would still
exist after the aforementioned reduction in the Payments, then there shall be no
reduction in the Payments.

7.2 Calculation of Gross-Up Payments. Subject to the provisions of Section 7.3,
all determinations required to be made under this Section 7, including the
amount of a Gross-Up Payment, shall be made by KPMG LLP or another mutually
agreeable nationally recognized accounting firm (the “Accounting Firm”), which
shall provide detailed supporting calculations both to the Company and the
Executive within fifteen (15) business days of (i) the Executive’s notice to the
Company of a claim by the Internal Revenue Service that, if successful, would
require the payment by the Company of a Gross-Up Payment, (ii) the Company’s
reporting or withholding for the Excise Tax, or (iii) such earlier or later time
as is requested by the Company. All fees and expenses of the Accounting Firm
shall be borne solely by the Company. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of a determination by the
Accounting Finn hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made (“Underpayment”), consistent
with the calculations required to be made hereunder. In the event that the
Company exhausts (or does not pursue) its remedies pursuant to Section 7.3 and
the Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the Company to or for the
benefit of the Executive.

7.3 Contested Payments. The Parties agree that, based upon the facts presently
known to them, they believe no Excise Tax is payable by the Executive based on
this Agreement or any other Company Arrangement. The Executive shall notify the
Company in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of a Gross-Up Payment. Such
notification shall be given as soon as practicable but not later than 20
business days after the Executive knows of such claim and shall apprise the
Company of the nature of such claim and the date on which such claim is
requested to be paid. The Executive shall not pay such claim prior to the
expiration of the 30-day period following the date on which it gives such notice
to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the Executive
in writing prior to the expiration of such period that it desires to contest
such claim, the Executive shall:

(a) give the Company any information reasonably requested by the Company
relating to such claim;

(b) take such action in connection with contesting such claim as the Company
shall reasonably request in writing from time to time, including, without
limitation, accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company;

(c) cooperate with the Company in good faith in order effectively to contest
such claim; and

(d) permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing provisions of
this Section 7.3, the Company shall control all proceedings taken in connection
with such contest and, at its sole option, may pursue or forgo and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and sue for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest to
a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis, and shall indemnify and
hold the Executive harmless, on an after-tax basis, from any Excise Tax or
income tax, including interest or penalties with respect thereto, imposed with
respect to such advance or with respect to any imputed income with respect to
such advance; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company’s control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority. In the event that the Company elects to,
or directs the Executive to, contest any claim by the Internal Revenue Service
that, if successful, would require payment by the Company of the Gross-Up
Payment under this Section 7, then in no event shall the Executive be entitled
to the payment of such Gross-Up Payment until such claim and all administrative
appeals, proceedings, hearings and conferences before any agency, tribunal,
court, or taxing authority, including, but not limited to, the Internal Revenue
Service, in respect of such claim have been exhausted.

7.4 Refunds. If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Section 7.3, the Executive becomes entitled to receive any
refund with respect to such claim, the Executive shall (subject to the Company’s
complying with the requirements of Section 7.3) promptly pay to the Company the
amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 7.3, a determination is made that
the Executive shall not be entitled to any refund with respect to such claim and
the Company does not notify the Executive in writing of its intent to contest
such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

7.5 Payment of Gross-Up Payments. Notwithstanding any provision of this
Agreement to the contrary, any Gross-Up Payment due to the Executive under this
Agreement shall not be made until the Termination Date. The Executive shall be
paid the Gross-Up Payment due to him under this Agreement, if any, in a single
sum, within five days after the later of (i) the expiration of the 30-day period
following the date on which Executive provided notice to the Company of a claim
by the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment, (ii) the date on which the Company has
exhausted, abandoned or resolved all administrative appeals, proceedings,
hearings and conferences in which the claim was or could be contested, or
(iii) the Company’s reporting or withholding for the Excise Tax, subject to
Section 8 below. All Gross-Up Payments by the Company to the Executive under
this Agreement shall be paid in any event no later than the last day of the
Executive’s taxable year following the taxable year in which the Executive
remits the taxes to which a payment to the Executive by the Company relates.

8. Code Section 409A

8.1 Code Section 409A

(a) This Agreement and the amounts payable hereunder are intended to qualify for
an exemption from, or alternatively to comply with the requirements of,
Section 409A of the Code, and shall be interpreted in accordance with such
intent. Notwithstanding anything in this Agreement to the contrary, if any
amount or benefit that would constitute “deferred compensation” for purposes of
Section 409A of the Code would otherwise be payable or distributable under this
Agreement or otherwise by reason of the Executive’s separation from service,
then if and to the extent necessary to comply with Code Section 409A (i) if the
payment or distribution of such amount or benefit is payable in a lump sum, such
payment or distribution will be delayed until the first day following the
six-month anniversary of the Executive’s termination of service, and (ii) if the
payment or distribution of such amount or benefit is payable over time, the
amount that would otherwise be payable during the six-month period immediately
following the Executive’s termination of service will be accumulated and paid to
the Executive, without interest, on the first day following the six-month
anniversary of the Executive’s termination of service (or, if earlier, the date
of his death), whereupon the normal payment schedule will resume.

(b) With respect to the continuation of medical coverage after the Termination
Date, if deemed necessary or advisable to secure an exemption from Code
Section 409A, the Company shall impute income to the Executive for such medical
coverage through the period that ends on the earlier of (i) the end of the
Company’s obligation to provide such coverage, or (ii) December 31 of the second
calendar year following the year in which the Termination Date occurs.
Immediately prior to such December 31 deadline, the Company shall satisfy its
remaining obligation under the Agreement, if any, with respect to such medical
coverage by paying to the Executive a lump sum in cash equal to the estimated
present value of such remaining coverage, based on the Company’s COBRA rates as
then in effect, and such payment shall be imputed as income to the Executive.

(c) The payment of each amount payable under this Agreement shall be deemed a
separate “payment” for purposes of Section 409A of the Code.

9. Full Settlement; Mitigation

The Company’s obligation to make the payments provided for in, and otherwise to
perform its obligations under, this Agreement shall not be affected by any
set-off, counter-claim, recoupment, defense or other claim, right or action that
the Company may have against the Executive or others other than a claim, right
or action for fraud after the individual is judicially determined to have
committed such action. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of the amounts
payable to the Executive under any of the provisions of this Agreement and such
amounts shall not be reduced, regardless of whether the Executive obtains other
employment.

10. Indemnification

The Indemnification Agreement between the Company and the Executive dated
February 10, 2009, as amended effective February 25, 2011 and the Letter
Agreement between the Company and the Executive dated February 25, 2011 shall
remain in full force and effect. Furthermore, the Executive shall continue to
have all rights to indemnification, advancement of legal fees and Directors and
Officers liability insurance coverage under the Company’s plans, by-laws, or
other corporate documents to the full extent permitted by law.

11. Miscellaneous

11.1 Applicable Law. This Agreement shall, to the extent not superseded by
federal law, be governed by and construed in accordance with the laws of the
State of Florida, without regard to principles of conflict of laws.

11.2 Amendments/Waiver. This Agreement may not be amended, waived, or modified
otherwise than by a written agreement that specifies the provision of this
Agreement being amended, waived or modified, and that is executed by the parties
to this Agreement or their respective successors and legal representatives. No
waiver by either party to this Agreement of any breach of any term, provision or
condition of this Agreement by the other party shall be deemed a waiver of a
similar or dissimilar condition or provision at the same time, or any prior or
subsequent time.

11.3 Notices. All notices and other communications hereunder shall be in writing
and shall be deemed given when received by hand-delivery to the other party, by
overnight courier, or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to the Executive:
William S. McCalmont
At the Executive’s principal residence
as set forth in the Company’s records.

If to the Company:
The Compensation Committee of the Board of Directors of The St. Joe Company
c/o The St. Joe Company
133 South WaterSound Parkway
WaterSound, FL 32413

or to such other addresses as either party furnishes to the other in writing in
accordance with this Section 11.3. Notices and communications shall be effective
when actually received by the addressee.

11.4 Withholding. The Company may withhold from any amounts payable under this
Agreement such taxes as shall be required to be withheld pursuant to any
applicable law or regulation.

11.5 Strict Compliance. The Executive’s or Company’s failure to insist upon
strict compliance with any provisions of, or to assert, any right under, this
Agreement shall not be deemed to be a waiver of such provision or right or of
any other provision of or right under this Agreement.

11.6 Enforceability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement. If any portion or provision of this Agreement shall to any
extent be declared illegal or unenforceable by an arbitrator or a court of
competent jurisdiction, then the remainder of this Agreement, or the application
of such portion or provision in circumstances other than those as to which it is
so declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

11.7 Captions: Counterparts. The captions of this Agreement are for convenience
of reference only, are not part of the terms of this Agreement and shall have no
force or effect in the application or interpretation thereof. This Agreement may
be executed in several counterparts, each of which shall be deemed an original
and said counterparts shall constitute but one and the same instrument.
Signatures delivered by facsimile (including, without limitation, by “pdf”)
shall be deemed effective for all purposes.

11.8 Entire Agreement. This Agreement contains the entire agreement between the
parties to this Agreement concerning the subject matter hereof and, except as
otherwise provided herein, supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or oral, between the
parties with respect thereto. Specifically this Agreement replaces and
supersedes in its entirety any prior employment and/or severance agreement
between the Company and the Executive, but it does not replace any obligation of
the Company or its Affiliates that is preserved under this Agreement.

11.9 Survivorship. The obligations of the Company and the Executive under this
Agreement shall survive the Termination Date.

11.10 Assignment. The rights and benefits of the Executive under this Agreement
may not be anticipated, assigned, alienated or subject to the attachment,
garnishment, levy, execution or other legal or equitable process except as
required by law. Any attempt by the Executive to so anticipate, alienate,
assign, sell, transfer, pledge, encumber or charge the same shall be void.

11.11 Arbitration. Except as otherwise provided in Sections 3.3, 4.1(g) and 5.8,
the Executive and the Company both agree to submit any disputes under this
Agreement to binding arbitration with a mutually agreeable arbitrator and to
make their best efforts to settle any disputes within 90 days. In the event this
does not occur and the Executive has cooperated in the arbitration process the
Company agrees to pay, to the full extent permitted by law, all legal fees and
expenses which the Executive may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof, plus in each case interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the Code.

[Signature Page Follows]

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IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the
authorization of its Board of Directors, the Company has caused this Agreement
to be executed in its name and on its behalf by a duly authorized officer, as of
the date set forth above.

THE ST. JOE COMPANY

/s/ Park Brady
Name: Park Brady
Title: Chief Operating Officer

EXECUTIVE

/s/ William S. McCalmont
William S. McCalmont
The Executive hereby re-executes this Agreement solely with respect to the
provisions of Section
4.1 thereof, effective as of the date set forth below.

      EXECUTIVE    
 
       
 
   
William S. McCalmont
  Date

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