SEC Filing | The St. Joe Company

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SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12

St. Joe Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(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:
2

(LOGO ST. JOE CORPORATION)

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 12, 1998

The annual meeting of the shareholders of St. Joe Corporation will be held
on Tuesday, May 12, 1998, at 10:30 a.m. Eastern Daylight Savings Time, at the
Davis Gallery in the Times-Union Center for the Performing Arts, 300 West Water
Street, Jacksonville, Florida.

The meeting will consider the following business which is described in the
accompanying Proxy Statement:

1. Election of a Board of nine Directors to hold office until their
successors are elected and qualified. The nominees presented by the Board
of Directors for election are described in the accompanying Proxy
Statement.

2. Consideration of management's proposal to adopt the 1998 Stock
Incentive Plan which is described in the accompanying Proxy Statement.

3. Consideration of management's proposal to amend and restate the
Articles of Incorporation of the Company. The full text of the proposed
Amended and Restated Articles of Incorporation, together with an
explanation of the proposed amendments, is included in the accompanying
Proxy Statement.

4. Ratification of KPMG Peat Marwick, LLP, as the Company's
independent accountants for the 1998 fiscal year.

5. Such other business as may properly come before the meeting or any
continuance of the meeting.

The Board of Directors has fixed the close of business on March 31, 1998,
as the record date for determining those shareholders who will be entitled to
vote at the meeting.

All shareholders who find it convenient to do so are cordially invited and
urged to attend the meeting in person. The holders of a majority of the
outstanding shares entitled to vote at the meeting, present in person or by
proxy, shall constitute a quorum.

The attached Proxy Statement contains important information regarding the
matters to be acted upon at the Annual Meeting.

The Annual Report containing financial data and a summary of operations for
1997 is enclosed.

By order of the Board of Directors.

/s/ Robert M. Rhodes
Robert M. Rhodes

Dated: April 27, 1998

IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. WHETHER OR
NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND RETURN THE PROXY CARD
ENCLOSED WITH THIS NOTICE AT YOUR EARLIEST CONVENIENCE.
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ST. JOE CORPORATION
1650 PRUDENTIAL DRIVE
JACKSONVILLE, FL 32207

PROXY STATEMENT

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

SOLICITATION AND REVOCATION OF PROXIES

GENERAL

THIS PROXY is being mailed or otherwise furnished to stockholders on or
about April 27, 1998, in connection with the solicitation by the Board of
Directors of St. Joe Corporation ("St. Joe or the "Company"), a Florida
corporation, of proxies to be voted at the 1998 Annual Meeting of Shareholders
of the Company to be held on May 12, 1998, and at any continuation thereof (the
"Annual Meeting"). Only shareholders of record on March 31, 1998 will be
entitled to vote at the meeting. On March 31, 1998, the Company had ninety-one
million six hundred ninety seven thousand eight hundred eleven (91,697,811)
shares of Common Stock issued and outstanding.

The address of the Company is 1650 Prudential Drive, Jacksonville, Florida
32207, and the telephone number is (904) 396-6600.

SOLICITATION

The enclosed proxy is being solicited by order of the Board of Directors of
the Company for use in connection with the Annual Meeting of the Company's
Shareholders to be held May 12, 1998. The expense of printing and mailing this
Proxy Statement will be borne by the Company. In addition to solicitation of
proxies by mail, the Company may reimburse brokers and other nominees for the
expenses of forwarding proxy materials to the beneficial owners of shares held
in their names. Directors, officers and employees of the Company may solicit
proxies on behalf of the Board of Directors personally, by mail, by telephone,
or by telecopy, but it is estimated that the expense of any solicitation, if
required, will be nominal.

It is the Company's policy that all proxies, ballots, and voting
tabulations that identify shareholders be kept confidential, except where
disclosure may be required by applicable law or regulation.

REVOCABILITY OF PROXIES

Your proxy may be revoked at any time prior to its being voted by written
notice to the Secretary of the Company or by attendance and voting in person at
the Annual Meeting by ballot. If your proxy is properly signed and you do not
revoke it, your shares will be voted at the Meeting in accordance with your
instructions. If no instructions are given, your proxy will be voted in favor of
management's proposals.

VOTING

Each share of Common Stock outstanding on the record date is entitled to
one vote. The required quorum is the majority of shares issued and outstanding
on the record date. The approval of Proposal 1, 2 and 4 shall require the
affirmative vote of the majority of shares present, in person or by proxy, at
the Annual Meeting. The approval of Proposal 3 shall require the affirmative
vote of the majority of shares issued and outstanding on the record date for
such approval. First Union National Bank, N.A., the Company's transfer agent,
will tabulate the votes.

At the 1997 Annual Meeting, 92.77% of the outstanding shares of Company's
Common Stock were present.
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GENERAL INFORMATION RELATING TO THE BOARD OF DIRECTORS

The Board of Directors ("Board") directs the management of the business and
affairs of the Company. The Board holds one regular meeting following the Annual
Shareholders' meeting and three scheduled quarterly meetings. During 1997, the
Board held 10 meetings; one annual, three quarterly, and six special. To assist
it in carrying out its duties, the Board has authority to appoint committees.
Under that authority, the Board, during 1997, had four standing committees. All
members of the Board of Directors attended at least seventy-five percent (75%)
of the total number of Board Meetings and meetings held by committees on which
each served.

The Audit Committee includes Walter L. Revell, Chairman, Russell B. Newton,
Jr., Winfred L. Thornton and Carl F. Zellers, Jr. The Audit Committee retains
public accountants to audit the Company's financial records, supervises such
audits, oversees the preparation of the Company's financial reports, and ensures
proper public disclosure of the Company's financial results. The Audit Committee
met four times in 1997.

The Compensation Committee includes John D. Uible, Chairman, John J.
Quindlen and Frank S. Shaw, Jr. The Compensation Committee recommends, subject
to full Board approval, compensation and benefits for the Chairman and Chief
Executive Officer, together with senior managers who report directly to the
Chairman and Chief Executive Officer, grants stock options and/or other awards
of the Company's stock pursuant to properly adopted Stock Incentive Plans,
approves annual bonus and merit plans for officers and employees, and supervises
the administration of all current employee benefit plans, together with such
other plans as may be created from time-to-time. The Compensation Committee met
six times during 1997.

The Finance Committee includes John J. Quindlen, Chairman, Jacob C. Belin,
Russell B. Newton, Jr., Frank S. Shaw, Jr. and John D. Uible. The Finance
Committee supervises the investment policies of the Company, makes
recommendations as to corporate dividends, reviews the Company's business plan,
reviews proposals to buy or sell significant assets and/or organizational
changes which would require public disclosure, and makes recommendations
regarding the issuance of the Company's securities. The Finance Committee met
five times during 1997.

The Nominating Committee includes Peter S. Rummell, Chairman, Russell B.
Newton, Jr., John J. Quindlen, Walter L. Revell, Frank S. Shaw, Jr., and John D.
Uible. The committee is responsible for proposing a slate of directors for
election by the shareholders at each annual meeting and for proposing candidates
to fill any vacancy on the Board. The committee will consider candidates for
Board membership proposed by shareholders who have complied with the procedures
described below. Any shareholder wishing to recommend or nominate a candidate
for director must follow such procedures. The Committee met once in 1997

During 1996, the Board appointed Russell B. Newton, Jr., Chairman, John J.
Quindlen, Walter L. Revell, Frank S. Shaw, Jr., and John D. Uible to serve on a
Special Committee. The purpose of this Special Committee was to evaluate a
possible transaction with Florida East Coast Industries, Inc. ("FECI"). On
December 15, 1997, this Committee was dissolved.

Compensation of Directors. The Board of Directors has the authority to fix
the compensation of directors. During 1997, directors were paid an annual
retainer of $25,000.00 and a board or committee meeting fee of $1,250.00. In
addition to the standard fees, directors are reimbursed for transportation and
other reasonable expenses incident to attendance at Board and Committee
Meetings.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

At the Annual Meeting, nine Directors of the Company are to be elected to
serve until the next annual election and until their successors are duly elected
and qualified. All of the nominees have served as directors since the last
Annual Meeting, except for Michael L. Ainslie, who will stand for election as a
director for the first time at this year's Annual Meeting.

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NOMINEES

The nine persons named below are the nominees for election as directors.
The enclosed proxy will be voted for the election of these directors unless
otherwise indicated by the shareholder. On the following pages there is
information on the nine nominees for director, stating, among other things,
their name, age and a brief description of their business experience.

The Board knows of no reason why any nominee for director would be unable
to serve as a director. If any nominee should, for any reason, be unable to
serve, the shares represented by all valid proxies would be voted for the
election of such other persons as the Board of Directors may designate, or the
Board may reduce the number of directors to eliminate the vacancy.

MICHAEL L. AINSLIE
New Nominee Age 55

Mr. Ainslie has been Chairman of Ainslie Ventures, Inc. in Palm Beach,
Florida since 1994. From 1984 to 1994 Mr. Ainslie was President and Chief
Executive Officer and a Director of Sotheby's Holdings. Mr. Ainslie served as
President and CEO of the National Trust for Historic Preservation in Washington
D.C. from 1980 to 1984. From 1968 to 1980 Mr. Ainslie held various management
positions with N-Ren Corporation in Cincinnati, Ohio; Palmas Del Mar in Puerto
Rico; and McKinsey and Company in New York. Mr. Ainslie is a director of Lehman
Brothers Holdings, Inc.; the U.S. Tennis Association; The New York Landmarks
Conservancy; Executive Committees of Vanderbilt University; the International
Tennis Hall of Fame; and Chairman of The Posse Foundation.

JACOB C. BELIN Director since 1953
Age 83

Mr. Belin was President of the Company from 1968 to 1984, and Chairman of
the Board and Chief Executive Officer from 1982 to June 1991. He is a director
of the Company and has served as such since 1953. Mr. Belin also serves as a
member of the Board of Directors of the Nemours Foundation, as a Trustee of the
Alfred I. duPont Testamentary Trust and as a director of FECI. (See "Voting
Securities and Principal Holders Thereof.").

RUSSELL B. NEWTON, JR. Director since 1994
Age 73

Mr. Newton is a Chairman of Timucuan Asset Management Company, which is
involved in investment portfolio management. Mr. Newton is also a director of
East Coast Oil Company and Alliance Mortgage Company, as well as other smaller,
closely-held companies. Since 1981, Mr. Newton has been an investor in oil,
marketing, shipping, public utilities, construction,, direct mail solicitation
and cable television. From 1975 to 1981, Mr. Newton was principal owner and
Chairman of Kern County Refineries, Inc. From 1968 to 1975, Mr. Newton was
President of Charter Oil Company. Mr. Newton spent his early employment years
with Booz, Allen & Hamilton, Management Consultants and as President of Southern
Stores, Inc.

JOHN J. QUINDLEN Director since 1995
Age 65

Mr. Quindlen retired as Senior Vice President and Chief Financial Officer
of E. I. duPont de Nemours & Company in 1993 ("duPont"). Mr. Quindlen worked for
duPont from 1954 until his retirement, except for three years as a naval Supply
Officer. Mr. Quindlen is a trustee of the Rodney Square Funds and the Kalmar
Pool Investment Trust. Mr. Quindlen is a member of the Finance Council of the
Archdiocese of Philadelphia and the President of its Board of Education.

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WALTER L. REVELL Director since 1994
Age 63

Mr. Revell is presently Chairman of the Board and CEO of H. J. Ross
Associates, Inc., a consulting engineering, architectural and planning firm in
Coral Gables, Florida, and Chairman of the Board and CEO of Revell Investments
International, Inc. and Infinity Technologies, Inc. Mr. Revell was President,
CEO and Director of Post, Buckley, Schuh & Jernigan, Inc. until 1983 after
serving as Secretary of Transportation for the State of Florida from 1972 to
1975. Mr. Revell is also a director of Dycom Industries, Inc., RISCORP, Inc. and
other closely-held companies, and is Chairman of the Greater Miami Foreign Trade
Zone, Inc.

PETER S. RUMMELL Director since 1997
Age 52

Mr. Rummell was appointed Chairman and CEO of the Company in January 1997.
From 1985 until 1996, Mr. Rummell was employed by The Walt Disney Company, most
recently as Chairman of Walt Disney Imagineering, the division responsible for
Disney's worldwide creative design, real estate and research and development
activities. Mr. Rummell also served as President of Disney Development Company,
the real estate development arm of Walt Disney, from 1992 to 1994 and as
President of the Arvida Resort Communities Division during 1985. From 1983 until
1985, Mr. Rummell was Vice Chairman of the Rockefeller Center Management
Corporation in New York City. Mr. Rummell was general manager and then President
of Sawgrass, near Jacksonville, Florida, from 1977 until 1983. Mr. Rummell also
held management positions for the Sea Pines Company in Hilton Head, South
Carolina, and the Amelia Island Plantation and spent two years as an employee of
the Ocean Reef Club in Key Largo, Florida.

FRANK S. SHAW, JR. Director since 1995
Age 66

Mr. Shaw is President of Shaw Securities, Inc., a financial services
company, and of Cherry Bluff, Inc., a northern Florida development firm based in
Tallahassee, Florida. Mr. Shaw also serves on the Board of Directors of First
South Bank, Regional Financial Company, The Southern Scholarship Foundation,
Maclay School Foundation, Leon County Library Foundation and the James Madison
Institute.

WINFRED L. THORNTON Director since 1968
Age 69

Mr. Thornton was Chairman of the Board and CEO from June 1991 to January
1997, and was President and Chief Operating Officer of the Company from 1984 to
June 1991. Mr. Thornton also serves as a member of the Board of Directors of the
Nemours Foundation, a Trustee of the Alfred I. duPont Testamentary Trust, and a
director of FECI. (See the Section entitled "Voting Securities and Principal
Holders Thereof").

JOHN D. UIBLE Director since 1994
Age 62

Since 1990, Mr. Uible has been an investor and Director of First Union
Corporation. Mr. Uible was Chairman of the Board and CEO of Florida National
Bank from 1982 to 1990, when it was acquired by First Union Corporation. From
1976 to 1982, Mr. Uible was Chairman of the Board and CEO of Jacksonville
National Bank of Florida, Inc. Mr. Uible was employed by the Charter Company
from 1958 to 1976.

RECOMMENDATION OF THE BOARD OF DIRECTORS -- THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR THE ABOVE SLATE OF NOMINEES.

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VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF

The Board of Directors of the Company has designated March 31, 1998 as the
record date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting and any continuation thereof. As of March 31, 1998,
the Company had one hundred eighty million (180,000,000) authorized and ninety
one million six hundred ninety seven thousand eight hundred eleven (91,697,811)
shares outstanding of Common Stock, no par value, which is its only voting
security. The following table sets forth information as of March 31, 1998 with
respect to persons known by the Company to be the beneficial owners of more than
five percent (5%) of its outstanding common stock and for each director and each
Executive Officer named in the Summary Compensation Table and for all directors
and executive officers as a group as of March 31, 1998. Under Rules of the
Securities and Exchange Commission, "beneficial ownership" is deemed to include
shares for which the individual, directly or indirectly, has or shares voting
and/or dispositive power.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

PERCENT OF
NAME AND ADDRESS NUMBER OF SHARES CLASS(1)
- ---------------- ---------------- ----------

Alfred I. duPont Testamentary Trust(2)(3)................... 51,967,979 56.7
P. O. Box 1380
Jacksonville, FL 32201
Franklin Resources Inc.(4).................................. 5,519,325 6.0
Charles B. Johnson
Rupert H. Johnson
777 Mariners Island Blvd.
San Mateo, CA 94404
Peter S. Rummell............................................ 1,010,565(5) 1.1
Charles A. Ledsinger........................................ *
Robert M. Rhodes............................................ 33,696(6) *
J. Malcolm Jones, Jr........................................ 17,593(7) *
Michael F. Bayer............................................ 16,848(8) *
Jacob C. Belin.............................................. 51,967,979(2)(3) 56.7
Russell B. Newton, Jr....................................... 6,000 *
John J. Quindlen............................................ 600 *
Walter L. Revell............................................ 1,000 *
Frank S. Shaw, Jr........................................... 2,000 *
Winfred L. Thornton......................................... 51,967,979(2)(3) 56.7
John D. Uible............................................... 15,270 *
Directors and Officers as a group........................... 53,105,372(9) 57.9

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(1) All percentages are rounded to the nearest tenth of one percent.
(2) The Trust owns 49,643,292 shares in its name. Under the provisions of the
Will creating the Trust, the Trustees of the Trust having the power to vote
the shares of stock specified above are J. C. Belin, Herbert Peyton, John
Porter, W. T. Thompson, III, W. L. Thornton and Hugh M. Durden on behalf of
Wachovia Bank, N.A., a subsidiary of Wachovia Corporation, as corporate
trustee. A majority of the Trustees have the right to vote all the stock of
the Company owned by the Trust. The Nemours Foundation owns 2,232,408 in its
name. The Trustees constitute the entire Board of Directors of The Nemours
Foundation and, therefore, have sole voting and sole dispositive power over
these shares.

(3) Includes 27,765 shares owned by Mr. Belin, 58,450 owned by Mr. Thompson and
6,064 owned by Mr. Thornton (including those held in the Company's 401(k)
plan).

(4) According to a Schedule 13G filed with the Securities and Exchange
Commission, as of December 31, 1997, the above shares are beneficially owned
by one or more open or closed end investment companies or other managed
accounts which are advised by direct and indirect advisory subsidiaries (the
"Advisory Subsidiaries") of Franklin Resources, Inc. ("FRI"). Such advisory
contracts grant to such Advisory Subsidiaries all voting and investment
power over the securities owned by such advisory clients. Therefore, such
Advisory
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Subsidies may be deemed to be, for purposes of Rule 13d-3 under the
Securities Exchange Act of 1934, the beneficial owner of the securities
listed above.
Charles B. Johnson and Rupert H. Johnson, Jr. (the "Principal Shareholders")
each own in excess of 10% of the outstanding Common Stock of FRI and are the
principal shareholders of FRI. FRI and the Principal Shareholders may be
deemed to be, for purposes of Rule 13d-3 under the 1934 Act, the beneficial
owner of securities held by persons and entities advised by FRI and it
subsidiaries. FRI, the Principal Shareholders and each of the Advisor
Subsidiaries has disclaimed any economic interest or beneficial ownership in
any of the above shares.
According to the Schedule 13G, Templeton Global Advisors Limited has the
sole power to vote or to direct the vote and the sole power to dispose or
direct the disposition of 3,436,500 shares and Franklin Mutual Advisors,
Inc. has the sole power to vote or to direct the vote and the sole power to
dispose or direct the disposition of 2,082,825 shares of the Company's
stock.
(5) Includes 201,861 restricted shares of common stock granted to Mr. Rummell
under the 1997 Stock Incentive Plan. In addition, 808,704 of his 4,043,520
options under the 1997 Stock Incentive Plan vested on January 8, 1998.
(6) Represents 33,696 of Mr. Rhodes' options under the 1997 Stock Incentive Plan
that vested on March 3, 1998.
(7) Includes 745 shares held in the Company's 401(K) plan and 16,848 options
under the 1997 Stock Incentive Plan that vested on February 25, 1998.

(8) Represents 16,848 of Mr. Bayer's options under the 1997 Stock Incentive Plan
that vested on February 25, 1998.

(9) Includes 33,821 shares held in the Company's 401(K) plan for which the
Trustee has sole voting power and the participants have sole dispositive
power. The Trustee of the plan is Merrill Lynch.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors, executive officers and
holders of more than 10% of the Company's Common Stock to file with the
Commission initial reports of ownership and reports of changes in ownership of
Common Stock and other equity securities of the Company. Certain officers and
directors have not timely complied with Section 16(a) filing requirements. The
following late filings have been submitted: Mr. Bayer -- Form 3 with respect to
his initial appointment as an officer of the Company and Form 5 with respect to
the grant of a stock option; Mr. David D. Fitch, Senior Vice President -- Form 3
with respect to his initial appointment as an officer of the Company and with
respect to the grant of a stock option; Mr. Jones -- Form 5 with respect to the
grant of a stock option; Mr. Ledsinger -- Form 3 with respect to his initial
appointment as an officer of the Company and Form 5 with respect to the grant of
a stock option; Mr. Newton -- Form 3 with respect to his initial election as a
Director of the Company; Mr. Rhodes -- Form 3 with respect to his initial
appointment as an officer of the Company and Form 5 with respect to the grant of
a stock option; Mr. Rummell -- Form 3 with respect to his initial appointment as
an officer of the Company and Form 5 with respect to the grant of a stock
option; and Mr. Uible -- Form 3 with respect to his initial election as a
Director of the Company.

The Company believes all officers and directors are now in compliance with
Section 16(a) filing requirements. The Company has implemented policies and
procedures to assist its officers and directors in complying with Section 16(a)
filing requirements.

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EXECUTIVE COMPENSATION

The following table sets forth the annual compensation of the Company's
executive officers for the past three (3) years.

SUMMARY COMPENSATION TABLE

ANNUAL COMPENSATION LONG TERM COMPENSATION
-------------------------- --------------------------------------
AWARDS
-----------------------
(A) (B) (C) (D) (E) (F) (G)
- -------------------------------------------------- ---- -------- -------- ---------- ---------- ------------
RESTRICTED SECURITIES
STOCK UNDERLYING ALL OTHER
AWARD(S) OPTIONS COMPENSATION
NAME YEAR SALARY BONUS ($)(1) (#)(2) (3)
- ---- ---- -------- -------- ---------- ---------- ------------

Peter S. Rummell.................................. 1997 $591,538 $300,000 3,863,620 4,043,520 413,022
Chairman of the Board and Chief................. 1996 N/A N/A N/A N/A N/A
Executive Officer............................... 1995 N/A N/A N/A N/A N/A
Winfred L. Thornton(4)............................ 1997 3,854 N/A N/A N/A N/A
Retired Chairman of the Board and Chief......... 1996 181,200 30,000 N/A N/A 3,975
Executive Officer............................... 1995 181,800 20,000 N/A N/A 3,810
Charles A. Ledsinger, Jr.......................... 1997 356,089(5) 210,000 N/A 240,000 232,889
President and Chief............................. 1996 N/A N/A N/A N/A N/A
Operating Officer............................... 1995 N/A N/A N/A N/A N/A
Robert M. Rhodes.................................. 1997 231,167 165,000 N/A 168,480 41,325
Senior Vice President and....................... 1996 N/A N/A N/A N/A N/A
General Counsel................................. 1995 N/A N/A N/A N/A N/A
J. Malcolm Jones, Jr.,............................ 1997 170,000 85,000 N/A 84,240 2,975
Senior Vice President, Forestry................. 1996 147,000 15,000 N/A N/A 2,805
Operations...................................... 1995 110,072 N/A N/A N/A 1,125
Michael F. Bayer.................................. 1997 155,544 100,500 N/A 84,240 93,365
Vice President, Human Resources................. 1996 N/A N/A N/A N/A N/A
And Administration.............................. 1995 N/A N/A N/A N/A N/A

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(1) At December 31, 1997, Mr. Rummell held 201,861 shares of restricted stock,
with an aggregate market value of $6,090,550. On March 25, 1997, Mr. Rummell
received a special distribution of $3.33 per share for each share of
restricted stock. On December 30, 1997, Mr. Rummell received a special
distribution of $.34 per share for each share of restricted stock.
Restricted share numbers have been restated to reflect a 3-for-1 split of
the Company's Common Stock on January 12, 1998.
(2) Option numbers have been restated to reflect a 3-for-1 split of the
Company's Common Stock on January 12, 1998. In addition, the exercise price
and number of options granted to Mr. Rummell, Mr. Rhodes, Mr. Jones and Mr.
Bayer have been restated, in accordance with the terms of the 1997 Stock
Incentive Plan as a result of the payment of a special distribution from the
net proceeds of the sale of the Company's communication segment, linerboard
mill, and container plants of $3.33 per share on March 25, 1997 to
shareholders of record on March 21, 1997. A final special distribution of
$.34 per share was paid on December 30, 1997 to shareholders of record on
December 19, 1997. The Audit Committee and the Compensation Committee
determined that adjustments to options granted, as a result of the second
special distribution, would not be material, thus no further adjustments
were made.
(3) The amounts disclosed in this column include:
(a) Company contributions under St. Joe's Deferred Compensation Plan in
fiscal 1997 of $762.00 for Mr. Ledsinger, $1,418 for Mr. Rhodes, $2,975
for Mr. Jones, and $1,688 for Mr. Bayer.
(b) Payment by the Company of $250 to Mr. Rummell for attendance at a Board
Meeting in 1997 prior to his appointment as Chairman and Chief
Executive Officer.

(c) Payments of a relocation allowance and benefits to Mr. Rummell of
$412,772, Mr. Ledsinger of $232,127, Mr. Rhodes of $39,907 and Mr.
Bayer of $91,677.

(4) Mr. Thornton retired as Chairman and Chief Executive Officer, effective
January 7, 1997. Mr. Thornton remains a director of the Company and is a
consultant to the Company. See "Certain Transactions".
(5) Includes $125,000 paid to Mr. Ledsinger to compensate him for benefits
forfeited upon resigning his position with his former employer.

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OPTION GRANTS IN 1997 (1)

PERCENT OF
TOTAL
OPTIONS NUMBER OF EXERCISE POTENTIAL REALIZABLE VALUE AT
GRANTED TO SECURITIES OR ASSUMED ANNUAL RATES OF
EMPLOYEES UNDERLYING BASE STOCK PRICE
IN FISCAL OPTIONS PRICE EXPIRATION ------------------------------
NAME YEAR GRANTED ($/SH) DATE 5%($) 10%($)
- ---- ------------ ---------- --------- ---------- ------------- --------------

Peter S. Rummell................... 73.4% 4,043,520 $19.14 1/8/07 $48,683,981 $123,367,795
Chairman of the Board
and Chief Executive Officer
Charles A. Ledsinger, Jr........... 4.4 240,000 23.71 5/5/07 3,578,800 9,068,400
President and Chief
Operating Officer
Robert M. Rhodes................... 3.1 168,480 23.00 3/3/07 2,436,782 6,175,915
Senior V.P. and General Counsel
J. Malcolm Jones, Jr............... 1.5 84,240 22.11 2/25/07 1,171,217 2,968,337
Senior V.P.
Forestry Operations
Michael F. Bayer................... 1.5 84,240 22.11 2/25/07 1,171,217 2,968,337
V.P. -- Human
Resources and Administration

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(1) Option numbers have been restated to reflect a 3-for-1 split of the
Company's Common Stock on January 12, 1998. In addition, the exercise price
and number of options granted to Mr. Rummell, Mr. Rhodes, Mr. Jones and Mr.
Bayer have been restated, in accordance with the terms of the 1997 Stock
Incentive Plan as a result of the payment of a special distribution from the
net proceeds of the sale of the Company's communication segment, linerboard
mill, and container plants of $3.33 per share on March 25, 1997 to
shareholders of record on March 21, 1997. A final special distribution of
$.34 per share was paid on December 30, 1997 to shareholders of record on
December 19, 1997. The Audit Committee and the Compensation Committee
determined that adjustments to options granted, as a result of the second
special distribution, would not be material, thus no further adjustments
were made.

EMPLOYEE BENEFIT PLANS

The Company maintains a defined benefit pension plan, and a deferred
compensation plan covering substantially all salaried employees of the Company
and its participating subsidiaries. Such plans as described in detail below, do
not discriminate in favor of directors or executive officers in the nature or
level of benefits provided to participants.

Pension Plan. The Company maintains a defined benefit pension plan (the
"Pension Plan") which covers all salaried employees of the Company and its
participating subsidiaries who have attained age 21 and completed one year of
service. Upon reaching normal retirement age of 65, each salaried employee with
at least five years of service will be eligible to receive annual retirement
benefits based on the "50% Joint and Survivors" form of payment (normal form)
equal to the product 1.5% of his or her "Final Average Earnings" multiplied by
the number of complete years and any monthly fraction thereof. These benefits
are not reduced for social security or other benefits received by the
participant. A participant may elect to receive actuarially equivalent benefits
payable through the "life only", "five or ten year certain and continuous" or
the "66 2/3%, 75% or 100% joint and survivor" annuity options, or any other form
of payment permitted by law and agreed to by the Pension Committee. "Final
Average Earnings" is defined as the greater of the participant's average annual
earnings over the 60 or 120 month period immediately preceding the participant's
retirement, termination, disability or death. Earnings used in the
aforementioned calculation are substantially the same as those disclosed in the
Summary Compensation Table. Employees who have reached age 55 with 15 years of
credited service may elect to receive retirement benefits for life as set forth
above, reduced by 1/2 of 1% for each month by which the early retirement date
precedes the normal retirement date.

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The following table shows estimated annual benefits payable under the
Pension Plan upon retirement to participants using specified average annual
earnings and years of service assuming the normal form of pay out is elected.

HIGHEST FIVE-YEAR AVERAGE COMPENSATION 15 20 25 30
- -------------------------------------- ------- ------- ------- -------

$ 100,000................................................ 22,500 30,000 37,500 45,000
200,000................................................ 45,000 60,000 75,000 90,000
300,000................................................ 67,500 90,000 112,500 135,000
400,000................................................ 90,000 120,000 150,000 180,000
500,000................................................ 112,500 150,000 187,500 225,000
600,000................................................ 135,000 180,000 225,000 270,000
700,000................................................ 157,500 210,000 262,500 315,000
800,000................................................ 180,000 290,000 300,000 360,000
900,000................................................ 202,500 270,000 337,500 405,000
1,000,000................................................ 225,000 300,000 375,000 450,000

The years of service credited for retirement purposes as of December 31,
1997 for the individuals listed in the Summary Compensation Table are:

W. L. Thornton.............................................. 37
P.S. Rummell................................................ 0
C. A. Ledsinger............................................. 0
R. M. Rhodes................................................ 0
J. M. Jones, Jr............................................. 0
M. F. Bayer................................................. 0

Deferred Compensation Plan. The Company maintains a deferred compensation
plan (the "401(k)") which covers all salaried employees of the Company and its
participating subsidiaries who elect to have their salary reduced by up to 6%
and have that money contributed into the 401(k) and invested as directed by the
participant. The eight accounts available are three mutual funds and common
stock of either the Company or FECI. The Company matches the employee
contribution $1.00 for $1.00 for the first $500; $0.75 per $1.00 for the next
$300.00, $.50 for the next $300.00; and $0.25 per $1.00 for the excess of $1,101
up to the maximum permitted employee contribution. Under certain conditions the
401(k) plan allows a participant to borrow from the fund. The funds are normally
paid out in a lump sum in the case of death, termination, disability, retirement
or after attainment of age 59 1/2. In 1997 the Company contributed the amounts
set forth in footnote (3) in the Summary Compensation Table on behalf of the
executive officers shown in that table.

Supplemental Executive Retirement Plan. In August, 1997 the Board adopted
a Supplemental Executive Retirement Plan ("SERP"). The SERP is designed to
provide certain qualified executives benefits which may be lost due to
limitations placed on qualified pension plans and 401(K) plans by the Internal
Revenue Service. Pursuant to the Company's SERP, a qualified individual may
elect to defer between 1% and 10% of his or her salary in excess of the IRS
annual compensation limit ($160,000 for 1997). For every dollar the individual
elects to defer the Company will contribute $.25, to a maximum of 6% of
compensation in excess of the IRS annual compensation limit. The SERP also
provides a supplemental retirement income benefit equal to a percentage (1.5 to
2.0%) of a qualified individual's final average compensation in excess of the
IRS limit, multiplied by years of service.

EXECUTIVE OFFICERS

PETER S. RUMMELL was appointed Chairman and Chief Executive Officer of the
Company in January 1997. From 1985 until 1996, Mr. Rummell was employed by The
Walt Disney Company, most recently as Chairman of Walt Disney Imagineering, the
division responsible for Disney's worldwide creative design, real estate and
research and development activities. Mr. Rummell also served as President of
Disney Development Company, the community development arm of Walt Disney, from
1992 to 1994 and as President of the Arvida Resort Communities Division during
1985. From 1983 until 1985, Mr. Rummell was Vice Chairman of the Rockefeller

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Center Management Corporation in New York City. Mr. Rummell was general manager
and then President of Sawgrass, near Jacksonville, Florida, from 1977 until
1983. Mr. Rummell also held management positions for the Sea Pines Company in
Hilton Head, South Carolina, and the Amelia Island Plantation and spent two
years as an employee of the Ocean Reef Club in Key Largo, Florida.

CHARLES A. LEDSINGER, JR. was appointed President and Chief Operating
Officer on February 24, 1998. He previously served the Company as Senior Vice
President and Chief Financial Officer from May 1997. From 1990 to 1997, Mr.
Ledsinger served as Senior Vice President and Chief Financial Officer of
Harrah's Entertainment/The Promus Companies, where from 1988 to 1990 he served
as Treasurer, from 1986 to 1988 as Vice President, Project Finance, and from
1983 to 1986 in the Embassy Suites Division. From December 1993 to April 1997,
Mr. Ledsinger served as Senior Vice President and Treasurer of Harrah's Jazz
Finance Company, a non-consolidated special-purpose finance subsidiary of
Harrah's Entertainment created in connection with the Harrah's Jazz project,
which filed for bankruptcy in November 1995. Mr. Ledsinger was employed by
Holiday Inns from 1978 to 1983, where he held a variety of financial management
positions. Prior to his employment at Holiday Inns, Mr. Ledsinger held various
management positions in the restaurant business and was a commercial property
manager for a regional property developer in Atlanta. Mr. Ledsinger is a
Director of TBC Corporation, Perkins Management Company, Inc., Friendly Ice
Cream Corporation and FelCor Suite Hotels, Inc.

ROBERT M. RHODES was named Senior Vice President and General Counsel in
February 1997. Prior to joining the Company, Mr. Rhodes was a partner in the law
firm of Steel Hector and Davis L.L.P., specializing in real estate and land
development. From 1985 to 1988 Mr. Rhodes served as Senior Vice President and
General Counsel of Arvida/Disney Corporation and Disney Development Company. Mr.
Rhodes also served in Florida state government as counsel to the Speaker of the
Florida House of Representatives and as Chief of the Bureau of Land and Water
Management, which administers the state's growth management programs.

J. MALCOLM JONES, JR. was named the Company's Senior Vice
President -- Forestry Operations in April 1997. From 1995 to 1997 Mr. Jones
served as the Company's Vice President and Chief Financial Officer. Mr. Jones
served as President of AmSouth Bank of Jacksonville in 1994 and 1995 and as
President and CEO of FloridaBank from 1990 to 1994.

MICHAEL F. BAYER was named Vice President -- Human Resources and
Administration in February, 1997. From 1987 until 1995, Mr. Bayer was employed
by The Walt Disney Company in a variety of executive positions in Human
Resources. Most recently he was Vice President of Human Resources of Walt Disney
Imagineering. Previously, Mr. Bayer served as Director -- Human Resources for
the Sarasota division of the Arvida Corporation.

EMPLOYMENT ARRANGEMENTS OF NEW MANAGEMENT

PETER S. RUMMELL. On January 7, 1997, the Company entered into an
Employment Agreement (the "Rummell Agreement") with Peter S. Rummell, its
Chairman of the Board and Chief Executive Officer. The Rummell Agreement has a
five-year term but may be terminated earlier under certain circumstances. The
Rummell Agreement provides for a salary of not less than $600,000 per year and a
performance-based incentive bonus ranging from 0% to 100% of salary, except that
the minimum bonus for the year 1997 is $250,000 and is contingent upon the
timely submission to, and acceptance by, the Board of Directors, of a business
plan for the Company. The Rummell Agreement also provides for the reimbursement
of relocation costs and related income taxes. On December 15, 1997, the Board
approved a business plan submitted by the Company's management. Mr. Rummell was
paid a bonus for 1997 of $300,000 on January 9, 1998.

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option becomes exercisable in the event that the Company terminates Mr.
Rummell's employment without cause, in the event of Mr. Rummell's death or in
the event that the Company is subject to a "change in control" (as defined
below). In the event that the Company terminates Mr. Rummell's employment
because of his disability, the option shall become exercisable to the extent
that it would have become exercisable during the 12 months immediately following
such termination had Mr. Rummell's employment continued. The option expires 10
years after the date of grant (or two years after Mr. Rummell's death, if
earlier).

Under the Rummell Agreement, the Company has also granted Mr. Rummell
201,861 restricted shares of its Common Stock under the Incentive Plan
(restricted share numbers have been restated to reflect a 3-for-1 split of the
Company's Common Stock on January 12, 1998). The restricted shares are intended
to compensate Mr. Rummell for the value of the stock options he forfeited upon
resigning his position with his former employer, based on the closing prices of
the two companies' Common Stock on the day preceding the execution of the
Rummell Agreement. The restricted shares vest in equal installments on the first
five anniversaries of the date of grant but the entire award vests in the event
that the Company terminates Mr. Rummell's employment without cause, in the event
of Mr. Rummell's death or disability (as defined in the Rummell Agreement), or
in the event that the Company is subject to a "change in control." If Mr.
Rummell's employment terminates for any other reason, he forfeits any restricted
shares that have not vested.

The Company may terminate Mr. Rummell's employment at any time for "cause"
(as described in the Rummell Agreement), in which event no further compensation
will be due. The Company may also terminate Mr. Rummell's employment if he has
been "disabled" for more than six months, in which event no further cash
compensation is due but benefit coverage continues for the remaining term of the
Rummell Agreement and the option and restricted shares vest to the extent
described above. Following a change in control, Mr. Rummell may resign for "good
reason" (as defined in the Rummell Agreement) and receive his salary for the
balance of the term of the Rummell Agreement, subject to certain restrictions.
For one year following a resignation for good reason, the Rummell Agreement
precludes Mr. Rummell from competing with the Company in certain respects.

"Change in control" is defined in the Rummell Agreement to mean (i) 30% or
more of the outstanding voting stock of the Company is acquired by any person or
group other than the Trust and the Nemours Foundation if such person or group
owns more voting stock of the Company than the Trust and the Nemours Foundation,
(ii) stockholders of the Company other than the Trust and the Nemours Foundation
vote in a contested election for directors resulting in the replacement of 50%
or more of the Company's directors or (iii) as a result of a merger or similar
transaction the Company's stockholders own 50% or less of the surviving entity's
voting securities. The Rummell Agreement provides that notwithstanding items
(i), (ii) and (iii) above, no "change in control" shall occur as long as the
Trust and the Nemours Foundation combined own more than 50% of the voting stock
of the Company.

CHARLES A. LEDSINGER, JR.; ROBERT M. RHODES; MICHAEL F. BAYER; AND J.
MALCOLM JONES, JR. The Company has entered into employment agreements (the
"Executive Agreements") with Messrs. Ledsinger (President and Chief Operating
Officer), Rhodes (Senior Vice President and General Counsel), Bayer (Vice
President -- Human Resources and Administration) and Jones (Senior Vice
President -- Forestry Operations) (each, individually, an "Executive", and
collectively, the "Executives"), that are based on substantially the same form
of agreement. The specific terms of each of the Executive Agreements are
tailored to each of Messrs. Ledsinger, Rhodes, Bayer and Jones, while the
general terms of each of the Executive Agreements are substantially similar. The
Executive Agreements of Messrs. Ledsinger, Rhodes, Bayer and Jones are dated
April 1997, March 3, 1997, February 1, 1997 and February 21, 1997, respectively.

The Executive Agreements provide that each of the Executives is an "at
will" employee. The Executive Agreements further provide that each Executive
shall receive (i) a base salary and (ii) a performance based incentive bonus in
an amount equal to between 0% and 60% of the Executive's base salary. The
Executive Agreements provide that the amount of each Executive's base salary and
the range of his bonus may be increased but not decreased during his period of
employment with the Company. The base salaries provided in the Executive
Agreements for Messrs. Ledsinger, Rhodes, Bayer and Jones are $350,000,
$275,000, $167,500 and $170,000, respectively. In addition, the Executive
Agreements of Messrs. Ledsinger, Rhodes and Bayer provide for the reimbursement
of relocation costs and related income taxes.

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The Executive Agreements also provide that each of the Executives shall
receive an option to purchase shares of the Company's Common Stock under the
1997 Stock Incentive Plan. In most cases, the exercise price of each option is
equal to the closing price of the Company's Common Stock on the day preceding
the date the Executive was granted such option. The exercise price of any
unexercised option shall be adjusted equitably in the event that the Company
makes a partial liquidation distribution to its shareholders. Each of the
options becomes exercisable in equal installments on the first five
anniversaries following the date of grant; provided, however, that the
Executive's option shall become exercisable in its entirety in the event that
the Company terminates the Executive's employment without "cause" (as defined in
the respective Executive Agreements) or the Company is subject to a "change in
control" ("change in control" is defined in the respective Executive Agreements
as in the Rummell Agreement). Each of the options expires on the tenth
anniversary following the date of grant.

The Executive Agreements further provide that, in the event the Company
terminates the employment of any of the respective Executives for any reason
other than for cause or disability, such Executive will receive a severance
payment ("Severance Payment") in a lump sum amount equal to a specified
percentage of the Executive's base salary, plus a specified percentage of the
amount of any bonus awarded to the Executive in the year prior to the
termination. Each of Mr. Ledsinger's and Mr. Rhodes' Executive Agreements
provides that any Severance Payment shall be in the amount of 150% of base
salary, plus 50% of the prior year's bonus, while each of Mr. Bayer's and Mr.
Jones' Executive Agreements provides that any Severance Payment shall be in the
amount of 100% of base salary, plus 50% of the prior year's bonus. Mr.
Ledsinger's, Mr. Bayer's and Mr. Jones' Executive Agreements also provide for an
augmented Severance Payment in the event that the Executive's employment is
terminated within 12 months following a change in control of the Company,
although such provisions are superseded by their Severance Agreements to the
extent that any such Severance Agreement provides for greater payments than the
applicable Executive Agreement.

Severance Agreements. The Company has entered into severance agreements
containing substantially identical terms and conditions (collectively, the
"Severance Agreements") with Messrs. Rummell, Ledsinger, Rhodes, Jones and
Bayer, pursuant to which each such executive shall be entitled to severance
benefits in the event of a "change in control" of the Company ("change of
control" is defined in the Severance Agreements as in the 1997 Stock Incentive
Plan) during the term of his employment.

Under the terms of the Severance Agreements, if an executive who has
entered into a Severance Agreement (i) resigns for any reason during the last
six months of the first year following the date of a change in control, (ii)
resigns for "good reason" (as defined in the Severance Agreements) within the
first 36 months following a change in control, or (iii) is terminated by the
Company within 36 months following the date of a change in control, then the
Company is obligated to provide the executive with certain payments and
benefits. Such payments and benefits that the Company is obligated to provide to
the executive include (A) payment of a lump sum amount equal to the sum of three
times the executive's annual base salary plus three times the executive's bonus
(as described in the Severance Agreement), (B) payment of a lump sum
supplemental pension benefit amount, (C) payment of a pro-rated bonus for the
year during which such executive's employment is terminated, (D) continued
participation in the Company's group insurance plans, at the Company's expense,
until the expiration of three years following the change in control (or the date
of the executive's death, if earlier), (E) senior executive level outplacement
services, and (F) "gross-up" payments, if applicable, in the amount necessary to
satisfy any excise tax incurred by the executive, if any, under Section 4999 of
the Code; provided, however, that if payment of such excise tax could be avoided
by reducing total payments under the Change in Control Agreement by $50,000 or
less, the total amount of such payments shall be reduced to the level necessary
to ensure that no excise tax shall be paid. In addition, under the terms of the
Severance Agreements, all stock options previously granted to the executive
shall become fully exercisable upon a change in control, and shall remain
exercisable until the earlier of the first anniversary following such change in
control or the date such options would have otherwise expired by their terms,
and any right of the Company to repurchase shares subject to the executive's
options shall lapse in full.

The Severance Agreements entered into by the executives do not supersede
the respective employment agreements entered into by such executives, except to
the extent that severance pay and benefits provided under the Severance
Agreements are greater than under the applicable employment agreement. Likewise,
the Severance Agreements do not supersede any respective stock option agreements
entered into by such executives, except to
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the extent that the applicable Severance Agreement provides for earlier
exercisability or a longer post-termination exercise period than under such
stock option agreement.

COMPENSATION COMMITTEE REPORT

The Compensation Committee is responsible for reviewing and approving the
compensation policies and programs for the Company's executive officers
including the Company's officers named in the Summary Compensation Table. The
Compensation Committee consists of members of the Board of Directors, who are
all independent non-employee directors and have no interlocking relationships as
defined by the Securities and Exchange Commission. The members were chosen
because of their business backgrounds and to ensure that the interests of the
shareholders are being served in all matters of executive compensation. This
report covers the actions of the Committee regarding the compensation of the
executive officers for 1997 and prospectively for 1998. The Committee does not
presently intend to award any options, restricted shares or stock appreciation
rights to any executive officer named in the Summary Compensation Table during
1998.

COMPENSATION PHILOSOPHY

The main tenants of the Company's compensation philosophy are:

(1) Base salaries at the median of comparable companies that generate
value from the management of substantial assets;

(2) Competitive annual incentives based on company and individual
performance; and

(3) Granting of stock options in order to align the interests of the
executives and shareholders.

ST. JOE INCENTIVE PLAN

In reviewing performance for 1997 to determine appropriate
performance-based bonuses, the committee used a discretionary process. The key
factors the committee considered in making its determination was the progress
the Company had made in developing a business plan; building an executive team
to lead the Company into the future; and the completion of significant
transactions. Given the Company's progress toward these objectives bonuses,
ranging from approximately 50% to 60% of base salary, were paid to the executive
officers.

In February 1998 the Committee advised the Board that the Committee had
adopted a formal evaluation process to set bonuses for 1998. The 1998 Plan is
split between quantitative financial measures and more qualitative strategic
measures. The committee intends to evaluate the performance of all eligible
employees utilizing this criteria in determining the amount of bonus which may
be payable in 1998.

CEO COMPENSATION

Mr. Rummell was appointed Chairman and CEO of the Company on January 7,
1997. The Compensation Committee used the compensation philosophy described
above to determine Mr. Rummell's compensation. Based upon these same criteria
the Committee recommended, and the Board approved an increase in base salary
from $600,000 to $630,000 (5%) effective January 1, 1998.

Pursuant to the Rummell Agreement, the Company has granted Mr. Rummell an
option to purchase 4,043,520 shares of the Company's Common Stock under the St.
Joe Corporation 1997 Stock Incentive Plan. The exercise price of the options is
$19.14 per share, which was equal to the closing price of the Company's Common
Stock on the day preceding the execution of the Rummell Agreement. The exercise
price was adjusted equitably as a result of a partial liquidation distribution
to the Company's shareholders on March 25, 1997 (option numbers have been
restated to reflect a 3-for-1 split of the Company's Common Stock on January 12,
1998). The option becomes exercisable in equal installments on the first five
anniversaries of the date of grant, but the entire option becomes exercisable in
the event that the Company terminates Mr. Rummell's employment without cause, in
the event of Mr. Rummell's death or in the event that the Company is subject to
a change in control. In the event that the Company terminates Mr. Rummell's
employment because of his disability, the option shall become exercisable to the
extent that it would have become exercisable during the 12 months immediately
following such
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termination had Mr. Rummell's employment continued. The option expires 10 years
after the date of grant (or two years after Mr. Rummell's death, if earlier).

Under the Rummell Agreement, the Company has also granted Mr. Rummell
201,861 restricted shares of its Common Stock under the 1997 Incentive Plan
(restricted share numbers have been restated to reflect a 3-for-1 split of the
Company's Common Stock on January 12, 1998). The restricted shares are intended
to compensate Mr. Rummell for the value of the stock options he forfeited upon
resigning his position with his former employer, based on the closing prices of
the two companies' Common Stock on the day preceding the execution of the
Rummell Agreement. The restricted shares vest in equal installments on the first
five anniversaries of the date of grant but the entire award vests in the event
that the Company terminates Mr. Rummell's employment without cause, in the event
of Mr. Rummell's death or disability (as defined in the Rummell Agreement), or
in the event that the Company is subject to a change in control. If Mr.
Rummell's employment terminates for any other reason, he forfeits any restricted
shares that have not vested.

DEDUCTIBILITY OF COMPENSATION

Section 162(m) of the Internal Revenue Code generally limits the company's
tax deduction to the first $1,000,000 in compensation paid to each of the CEO
and the four most highly compensated executive officers who are executive
officers as of the last day of the applicable year. Exceptions are made,
however, for "performance-based" compensation.

The annual incentive plan in place for 1998 will not satisfy the 162(m)
requirements for performance-based compensation. The Committee views the
potential loss of tax deductibility for these awards as not material. The
Committee retains the discretion to pay non-deductible compensation if it
believes that it would be in the best interest of the company and its
shareholders.

Submitted by the Compensation Committee

John D. Uible, Chairman

John J. Quindlen
Frank S. Shaw, Jr.

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PERFORMANCE GRAPH(1)

The following performance graph compares the Company's cumulative
shareholder returns for the period February 26, 1993 through February 27, 1998
assuming $100 invested on February 26, 1993 in the Company's common stock, in
the Russell 1000 Index and in the Wilshire Real Estate Securities Index. The
stock price performance shown on the graph below is not necessarily indicative
of future price performance.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN(2)

MEASUREMENT PERIOD ST. JOE WILSHIRE REAL
(FISCAL YEAR COVERED) CORPORATION RUSSELL 1000 INDEX ESTATE

2/93 100 100 100
2/94 136 105 104
2/95 151 109 92
2/96 155 144 101
2/97 197 176 128
2/98 260 233 140

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(1) The Company has used the Standard & Poor's Paper and Forest Products Index
to compare shareholder return in the past. With the sale of the Company's
linerboard mill and container plants in 1996, the company believes a real
estate index is a more appropriate measure.
(2) $100 invested on 2/26/93 in stock or index including reinvestment of
dividends.

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CERTAIN TRANSACTIONS

Jacob C. Belin and Winfred L. Thornton are trustees of the Trust and also
serve as directors of the Company and FECI.

On May 1, 1997, the Company entered into consulting agreements with Mr.
Belin and Mr. Thornton (the "Consulting Agreements"). Pursuant to the Consulting
Agreements, Messrs. Belin and Thornton will advise and counsel the Company on
various corporate matters at the request of the Chairman and Chief Executive
Officer. The Consulting Agreements provide that Messrs. Belin and Thornton will
receive annual compensation of $100,000 and $112,000, respectively, and will be
reimbursed for expenses actually incurred up to $10,000.00 per year.

The Nemours Foundation and the Company rent office space from one of the
company's subsidiaries at rates approximating market rentals.

On February 24, 1998, the Board elected Charles A. Ledsinger, Jr. President
and Chief Operating Officer of the Company.

On November 21, 1997, the Company announced the withdrawal of its
outstanding offer to purchase all outstanding FECI Common Stock not owned by the
Company at $102 per share.

Mr. Zellers declined an invitation to be renominated as a Director of the
Company.

On November 3, 1997, the Finance Committee of the Board approved the
purchase of Riverside Golf Management Company ("Riverside"). In attendance at
the meeting was Mr. Uible, who advised the Committee that he had an outstanding
loan to Steve Melnyck, the sole shareholder of Riverside. The Committee
unanimously approved the transaction which resulted in St. Joe acquiring all of
Riverside's stock in exchange for Company stock. Mr. Uible recused himself from
discussion and voting. Mr. Uible also advised the Company that he had an option
to buy up to 10% of the Riverside stock which he intended to exercise. Mr. Uible
and Mr. Melnyck have reached an agreement whereby Mr. Melnyck has delivered
5,270 shares of Company stock to Mr. Uible to satisfy all outstanding
obligations.

PROPOSAL NO. 2

APPROVAL OF THE 1998 STOCK INCENTIVE PLAN

HISTORY OF THE PLAN. The Company's 1998 Stock Incentive Plan (the "1998
Incentive Plan") was adopted by the Board of Directors in February of 1998. It
became effective on February 24, 1998, subject to the approval of the
shareholders. The Board of Directors may amend or terminate the Incentive Plan
at any time and for any reason. Amendments require the approval of the Company's
shareholders only to the extent provided by applicable laws, regulations or
rules.

The key provisions of the 1998 Incentive Plan are summarized below. This
summary, however, is not intended to be a complete description of all terms of
the Incentive Plan. A copy of the plan text will be furnished to any shareholder
upon request. Such a request should be directed to Robert M. Rhodes, Secretary,
The St. Joe Company, 1650 Prudential Drive, Suite 400, Jacksonville, Florida
32207.

ADMINISTRATION AND ELIGIBILITY. The 1998 Incentive Plan is administered by
the Compensation Committee of the Board of Directors. The Compensation Committee
also selects the individuals who receive awards, determines the size of any
award and establishes any vesting or other conditions. Employees and
non-employee directors of the Company are eligible to participate in the
Incentive Plan, although incentive stock options may be granted only to
employees.

FORM OF AWARDS. The 1998 Incentive Plan provides for awards in the form of
restricted shares, stock appreciation rights or options. No payment is required
upon receipt of an award, except that a recipient of newly issued restricted
shares may be required to pay the par value of such restricted shares to the
Company.

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RESTRICTED SHARES. Restricted shares are shares of Common Stock that are
subject to forfeiture in the event that the applicable vesting conditions are
not satisfied. Restricted shares have the same voting and dividend rights as
other shares of Common Stock.

OPTIONS. Options may include nonstatutory stock options ("NSOs") as well
as incentive stock options ("ISOs") intended to qualify for special tax
treatment. The term of an option cannot exceed 10 years, and the exercise price
must be equal to or greater than the fair market value of the Common Stock on
the date of grant. As of March 31, 1998, the closing price of the Company's
Common Stock on the New York Stock Exchange Composite Transactions Report was
$33.625 per share.

The exercise price of an option may be paid in any lawful form permitted by
the Compensation Committee, including (without limitation) a full-recourse
promissory note or the surrender of shares of Common Stock or restricted shares
already owned by the optionee. The Compensation Committee may likewise permit
optionees to satisfy their withholding tax obligation upon exercise of an NSO by
surrendering a portion of their option shares to the Company. The Incentive Plan
also allows the optionee to pay the exercise price of an option by giving
"exercise/sale" or "exercise/pledge" directions. If exercise/sale directions are
given, a number of option shares sufficient to pay the exercise price and any
withholding taxes is issued directly to a securities broker selected by the
Company, who, in turn, sells these shares in the open market. The broker remits
to the Company the proceeds from the sale of these shares, and the optionee
receives the remaining option shares. If exercise/pledge directions are given,
the option shares are issued directly to a securities broker or other lender
selected by the Company. The broker or other lender holds the shares as security
and extends credit for up to 50% of their market value. The loan proceeds are
paid to the Company to the extent necessary to pay the exercise price and any
withholding taxes. Any excess loan proceeds may be paid to the optionee. If the
loan proceeds are insufficient to cover the exercise price and withholding
taxes, the optionee is required to pay the deficiency to the Company at the time
of exercise.

The Committee may at any time offer to buy out an outstanding option for
cash or give an optionee the right to surrender his or her option for cash.

STOCK APPRECIATION RIGHTS. A Stock Appreciation Right entitles the
Recipient, upon exercise, to receive in cash an amount equal to the difference
between the Fair Market Value of a Common Share on the date of grant ("Base
Value") and the Fair Market Value of a Common Share on the date the Stock
Appreciation Right is exercised. Each Award of a Stock Appreciation Right may or
may not be subject to vesting. Vesting shall occur, in full or in installments,
upon satisfaction of the conditions specified in the Stock Appreciation Rights
Agreement. The Stock Appreciation Rights Agreement shall also specify the term
of the Stock Appreciation Right; provided that the term of a Stock Appreciation
right shall in no event exceed 10 years from the date of grant. A Stock
Appreciation Rights Agreement may provide for accelerated vesting in the event
of the Participant's death, disability or retirement or other events. The
Committee may determine, at the time of granting Stock Appreciation Rights or
thereafter, that all or part of such Stock Appreciation Rights shall become
vested in the event that a Change in Control occurs with respect to the Company.
The Committee may at any time, at such terms and conditions as it determines,
buyout a Stock Appreciation Right for a payment in Common Shares (which may or
may not include Restricted Shares), Stock Options and cash for any fractional
Common Share. The value of such combination of Stock Options, cash and Common
Shares may not exceed the difference between Base Value and Fair Market Value of
a Common Share on the date of such buyout. The Committee may, at its discretion,
use Options with an Exercise Price below Fair Market Value on date of grant to
buyout Stock Appreciation Rights. If Options are used to buyout Stock
Appreciation Rights, the Exercise Price of these Options will not be lower than
the Exercise Price of the Stock Appreciation Rights that are being bought out.

VESTING CONDITIONS. As noted above, the Compensation Committee determines
the number of restricted shares, stock appreciation rights or options to be
included in the award as well as the vesting and other conditions. The vesting
conditions may be based on the length of the recipient's service, his or her
individual performance, the Company's performance or other appropriate criteria.
Vesting may be accelerated in the event of the recipient's death, disability or
retirement or in the event of a change in control with respect to the Company.

For purposes of the 1998 Incentive Plan, the term "change in control" means
generally that (i) any person or group, other than the Alfred I. duPont
Testamentary Trust (the "Trust"), and the Nemours Foundation (the
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"Foundation"), acquires 30% or more of the outstanding voting stock of the
Company and the Trust and the Foundation no longer own more voting stock than
such person or group, (ii) the Company is a party to a merger or similar
transaction as a result of which the Company's shareholders own 50% or less of
the surviving entity's voting securities or (iii) shareholders other than the
Trust and the Foundation cause a change of 50% or more in the composition of the
Board of Directors in a contested election of directors. For purposes of the
Incentive Plan, no "change in control" can occur as long as the combined
ownership of the Trust and the Foundation exceeds 50% of the Company's
outstanding voting stock.

MODIFICATION OF AWARDS. The Compensation Committee is authorized, within
the provisions of the Incentive Plan, to amend the terms of outstanding
restricted shares, to modify or extend outstanding options, to exchange new
options for outstanding options, including outstanding options with a higher
exercise price than the new options, or to convert outstanding stock appreciate
rights to options.

GRANTS TO NON-EMPLOYEE DIRECTORS. Members of the Company's Board of
Directors who are not employees of the Company may receive option grants under
the Incentive Plan. The exercise price of all options that may be granted to
non-employee directors is equal to the market value of Common Stock on the date
of grant.

NUMBER OF RESERVED SHARES. The total amount of restricted shares, stock
appreciation rights and options available for grant under the 1998 Incentive
Plan is 1 million (subject to anti-dilution adjustments). If any restricted
shares, stock appreciate rights or options are forfeited, or if options
terminate for any other reason prior to exercise, then they again become
available for awards. No individual may receive stock appreciate rights options
covering more than .5 million shares in any calendar year (subject to
anti-dilution adjustments). The Company has entered into an Agreement with the
Trust in which the Company has agreed that it will grant only Stock Appreciation
Rights under the 1998 Incentive Plan for a period of one year from the date of
approval of the 1998 Incentive Plan by the shareholders. Under the Agreement,
the Stock Appreciation Rights can be converted to options after one year from
the date of shareholders' approval of the 1998 Incentive Plan. After May 12,
1999, any Stock Appreciation Rights previously awarded can be converted to
options, and the restrictions described in this Paragraph will be released.

Awards under the 1998 Incentive Plan are discretionary. Therefore, it is
not possible to determine the benefits that will be received in the future by
participants in the Incentive Plan or the benefits that would have been received
by such participants if the Incentive Plan had been in effect in 1997. To date,
the following options have been granted under the Incentive Plan (subject to
shareholder approval):

NEW PLAN BENEFITS

1998 STOCK INCENTIVE PLAN

NUMBER OF SHARES
GROUP COVERED BY OPTIONS
- ----- ------------------

All Current Executive Officers as a Group................... -0-
All other participants...................................... 15,000

FEDERAL INCOME TAX CONSEQUENCES OF OPTIONS. Neither the optionee nor the
Company incurs any federal tax consequences as a result of the grant of an
option. The optionee has no taxable income upon exercising an ISO (except that
the alternative minimum tax may apply), and the Company receives no deduction
when an ISO is exercised. Upon exercising an NSO, the optionee generally must
recognize ordinary income equal to the "spread" between the exercise price and
fair market value of Common Stock on the date of exercise; the Company
ordinarily will be entitled to a deduction for the same amount. In the case of
an employee, the option spread at the time an NSO is exercised is subject to
income tax withholding, but the optionee generally may elect to satisfy the
withholding tax obligation by having shares of Common Stock withheld from those
purchased under the NSO. The tax treatment of a disposition of option shares
acquired under the Incentive Plan depends on how long the shares have been held
and on whether such shares were acquired by exercising an ISO or by exercising a
NSO. The Company is not entitled to a deduction in connection with a disposition
of options shares,

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except in the case of a disposition of shares acquired under an ISO before the
applicable ISO holding periods have been satisfied.

RECOMMENDATION OF THE BOARD OF DIRECTORS -- THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR THE APPROVAL OF THE 1998 STOCK INCENTIVE PLAN.

PROPOSAL NO. 3

RESTATED AND AMENDED ARTICLES OF INCORPORATION

On February 24, 1998, the Board adopted a Resolution Recommending the
Company's Articles of Incorporation be Restated and Amended. PLEASE READ THIS
SECTION OF THE PROXY STATEMENT, TOGETHER WITH THE EXHIBIT REFERENCED BELOW AND
ATTACHED HERETO, CAREFULLY BEFORE VOTING ON THIS PROPOSAL.

The Company's existing Articles of Incorporation consist of four (4)
documents:

(1) the Agreement of Merger of St. Joe Dock and Terminal Railway and
St. Joe Paper Company dated November 1, 1961 (the "1961 Articles");

(2) the Amendment filed in 1990 increasing the number of authorized
shares to 60,000,000 (the "1990 Amendment");

(3) the Amendment filed in 1996 changing the name of the Company from
St. Joe Paper Company to St. Joe Corporation (the "1996 Amendment"), and

(4) The Amendment filed in 1998 increasing the number of authorized
shares to 180,000,000 (the "1998 Amendment").

For the following reasons, the Board is recommending the Articles be
Restated and Amended:

(1) The 1961 Articles contain a description of corporate purpose that
does not accurately reflect the Company's present business;

(2) Existing Florida law has modified corporate powers and
responsibilities not reflected in the existing Articles; and

(3) Consolidating the Articles into a single document will facilitate
use and avoid confusion.

(4) In order to remedy an inconsistency between the Company's Bylaws
and the 1961 Articles, and to provide for a smaller, more accountable,
manageable Board, the Articles should be amended to provide the Board shall
consist of not less than 9 nor more than 15 members. The 1961 Articles
provide for not less than 11 nor more than 17 Directors. The Company's
Bylaws provide for not less than 9 nor more than 15 members. The
shareholders have previously elected less than 11 members. For example, in
1997 the shareholders elected 9 Directors. This Amendment to the Articles
will clarify, ratify and memorialize previous shareholder action.

(5) The Company's Bylaws provide that special meetings of shareholders
can be called by shareholders owning one-third or more of the Company's
outstanding stock. The Florida Business Corporation Act authorizes the
shareholders to establish the minimum percentage of shareholders required
to call a special meeting of the shareholders between ten percent and fifty
percent. If the minimum percentage exceeds ten percent, it must be set by
the shareholders in the Articles of Incorporation. In order to remedy the
inconsistency between the Company's Bylaws and state law, and to enhance
Company accountability to shareholders, the minimum percentage of
shareholders required to call a special meeting should be set at thirty
percent.

The following is a summary of the recommended changes:

(1) The Articles are amended to provide the name of the Company is
changed from St. Joe Corporation to The St. Joe Company;

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(2) The address of the principal office is changed to reflect its
current location;

(3) The number of authorized shares is confirmed at 180,000,000
shares;

(4) The name and address of the Company's Registered Agent is changed
to reflect the current name and address;

(5) The Articles are amended to provide the Board of Directors shall
consist of not less than 9 nor more than 15 members.

(6) The Articles are amended to provide that special meetings of the
shareholders can be called by stockholders owning thirty percent or more of
the Company's outstanding stock.

A copy of the Amended and Restated Articles is attached to hereto as
Appendix A. Copies of the 1961 Articles, the 1990 Amendment, the 1996 Amendment
and the 1998 Amendment will be furnished to any shareholder upon request. Such
request should be directed to Robert M. Rhodes, Secretary, The St. Joe Company,
1650 Prudential Drive, Suite 400, Jacksonville, Florida 32207.

RECOMMENDATION OF THE BOARD OF DIRECTORS -- THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR THE APPROVAL OF THE AMENDED ARTICLES.

PROPOSAL NO. 4

RATIFICATION OF INDEPENDENT ACCOUNTANTS

The Board, upon the recommendation of the Audit Committee, has appointed
the firm of KPMG Peat Marwick L.L.P. to audit the consolidated financial
statements for the Company for the 1998 fiscal year.

The firm of KPMG Peat Marwick L.L.P. has been Company's Accountant of
record since August, 1990. It is expected that a representative of KPMG Part
Marwick L.L.P. will be present at the Annual Meeting to answer shareholders's
questions and will be given an opportunity to make a statement.

RECOMMENDATION OF THE BOARD OF DIRECTORS -- THE BOARD RECOMMENDS THE
SHAREHOLDERS VOTE FOR RATIFICATION OF KPMG PEAT MARWICK. L.L.P. AS THE COMPANY'S
INDEPENDENT ACCOUNTANTS FOR THE 1998 FISCAL YEAR.

SHAREHOLDER PROPOSALS

Each year, the Board of Directors submits to the shareholders at the Annual
Meeting certain proposals. Other proposals may be submitted by the Board of
Directors or shareholders for inclusion in the Proxy Statement for action at the
Annual Meeting. Any proposal submitted by a shareholder for inclusion in the
1999 Annual Meeting Proxy Statement must be submitted in writing and must be
received by the Company no later than January 4, 1999. Any such proposals, as
well as any questions related thereto, should be directed to the Corporate
Secretary.

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OTHER MATTERS

The Board of Directors does not know of any other business to be presented
at the Annual Meeting. If any other matters come before the Annual Meeting, the
persons named in the accompanying Proxy will have discretionary authority to
vote the Proxy in accordance with their judgment in such matters.

BY ORDER OF THE BOARD OF DIRECTORS,

/s/ ROBERT M. RHODES

--------------------------------------
Robert M. Rhodes
Senior Vice President and General
Counsel

Dated April 27, 1998.

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RESTATED AND AMENDED
ARTICLES OF INCORPORATION
OF
THE ST. JOE COMPANY

Pursuant to the provisions of Section 607.1007 of the Florida Business
Corporation Act, the undersigned corporation pursuant to a resolution duly
adopted by its Board of Directors, adopts the following restated and amended
articles of incorporation.

AMENDED
ARTICLE I
NAME

The name of the corporation ("Corporation ") is The St. Joe Company.

ARTICLE II
DURATION

The duration of the Corporation is perpetual.

ARTICLE III
PRINCIPAL OFFICE

The street address of the principal office of the Corporation is 1650
Prudential Drive, Suite 400, Jacksonville, Florida 32207.

ARTICLE IV
STOCK

The maximum number of shares of stock that the Corporation is authorized to
have outstanding at any time is one hundred eighty million (180,000,000) shares
having no par value per share, all of which shall be common voting stock of the
same class. All shares of common stock issued shall be fully paid and
non-assessable. The Corporation shall have the right to issue fractional shares.

ARTICLE V
REGISTERED OFFICE AND AGENT

The street address of the Corporation's registered office is 1650
Prudential Drive, Suite 400, Jacksonville, Florida 32207. The registered agent
for the Corporation at that address is Robert M. Rhodes.

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AMENDED
ARTICLE VI
DIRECTORS

The number of Directors of the Corporation shall be not less than nine (9)
nor more than fifteen (15).

The names and addresses of the Board of Directors who, subject to the
Bylaws of the Corporation and the laws of Florida, shall hold office until the
next annual meeting of the Shareholders of the Corporation or until their
successors are elected and have been duly qualified, are:

NAME ADDRESS
- ---- -------

Michael L. Ainslie......................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Jacob C. Belin............................. 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Russell B. Newton, Jr...................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
John J. Quindlen........................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Walter L. Revell........................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Peter S. Rummell........................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Frank S. Shaw, Jr.......................... 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
Winfred L. Thornton........................ 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207
John Uible................................. 1650 Prudential Drive, Ste. 400
Jacksonville, Florida 32207

AMENDED

ARTICLE VII
CALL OF SPECIAL SHAREHOLDER MEETINGS

Special meetings of shareholders may be called at any time for any purpose
by the holders of thirty percent (30%) of the Corporation's issued and
outstanding shares.

ARTICLE VIII
RESTATED ARTICLES

The restated articles of incorporation primarily restate and integrate the
provisions of the Corporation's articles of incorporation as previously amended,
and also contain certain amendments, specifically designated as Amended which
were adopted pursuant to the Florida Statutes. There is no discrepancy between
the Corporation's articles of incorporation as previously amended and the
provisions of the restated articles of incorporation other than the inclusion of
certain updated information and amendments, adopted pursuant to the Florida
Statutes, changing the Corporation's name, establishing the number of Directors,
and setting the minimum percentage of shareholders necessary to call a special
meeting of shareholders.

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IN WITNESS WHEREOF, these Restated and Amended Articles of Incorporation
have been executed this day of May, 1998.

The St. Joe Company

By:

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

Robert M. Rhodes

Senior Vice President & General
Counsel

State of Florida

County of Duval

The foregoing instrument was acknowledged before me this day of May,
1998, by Robert M. Rhodes, as Senior Vice President & General Counsel of the St.
Joe Company, a Florida corporation, on behalf of the Corporation.

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

Notary Public

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APPENDIX

PROXY

ST. JOE CORPORATION

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 12, 1998.

The undersigned having received Notice of Annual Meeting and Proxy Statement
dated April 11, 1998, appoints Peter S. Rummell as Proxy with full power of
substitution to represent the undersigned and to vote all shares of common stock
of St. Joe Corporation, which the undersigned is entitled to vote at the Annual
Meeting of Shareholders, to be held on Tuesday, May 12, 1998, at 10:30 a.m.
Eastern Daylight Savings Time, at the Davis Gallery in the Times-Union Center
for the Performing Arts, 300 West Water Street, Jacksonville, Florida, or at any
continuance thereof, with discretionary authority as provided in the Proxy
Statement.

Please mark your vote as indicated in the example. [X]

This Proxy will be voted as directed. If no direction is made, it will be
voted "For" the proposals set forth on this card. The Board of Directors
recommends a vote "For" the following proposals:

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

1. ELECTION OF DIRECTORS

Nominees: Michael L. Ainslie, Jacob C. Belin, Russell B. Newton, Jr., John
J. Quindlen, Walter L. Revell, Peter S. Rummell, Frank S. Shaw, Jr., Winfred
L. Thornton, John D. Uible

[ ] FOR [ ] WITHHELD [ ] FOR, except vote withheld from the following
nominees

2. APPROVAL OF THE 1998 STOCK INCENTIVE PLAN

See Proposal No. 2 in the Enclosed Proxy Statement for more information on
the Plan.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

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

(Continued from front)

3. APPROVAL OF RESTATED AND
AMENDED ARTICLES OF INCORPORATION

See Proposal No. 3 in the enclosed Proxy Statement
for more information on the Restated and
Amended Articles of Incorporation.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

4. RATIFICATION OF INDEPENDENT ACCOUNTANTS

[ ] FOR [ ] AGAINST [ ] ABSTAIN

X
----------------------------------

Date
-------------------------------

Please sign exactly as your name
appears on shares. Joint owners
should each sign. When signing as a
fiduciary or for an estate, trust,
corporation, or partnership, your
title or capacity should be stated.