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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant  x                             Filed by a Party other than the Registrant:  ¨

Check the appropriate box:

CST BRANDS, INC.

(Name of Registrant as Specified in its Charter)

Payment of Filing Fee (Check the appropriate box):

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CST BRANDS, INC.

One Valero Way

Building D, Suite 200

San Antonio, TX 78249

(210) 692-5000

April 21, 2014

Dear Stockholders:

I am pleased to invite you to join me, our Board of Directors and our senior leadership at the CST Brands’ 2014 Annual Meeting of Stockholders to be held on June 4, 2014, at 9:00 a.m., Central Time, at our CST Service Center located at One Valero Way, Building D, 4^th Floor, San Antonio, TX 78249. We hope that you will be able to attend the meeting. The attached Notice of 2014 Annual Meeting of Stockholders and Proxy Statement will explain in detail matters on which action will be taken at the meeting.

While I hope you can join us in San Antonio, whether or not you attend in person, it is important that you vote your shares. We are offering multiple options for voting your shares. All holders may vote their shares by mail, telephone, Internet or at the 2014 Annual Meeting. Instructions on how to vote are found on page 2.

If you have any questions or need assistance in voting your shares, please contact our proxy solicitor, Georgeson Inc. toll free at (800) 932-9864.

Thank you for your continued support of CST Brands. I look forward to seeing many of you in San Antonio on June 4^th.

Kimberly S. Bowers Chairman of the Board, Chief Executive Officer and President

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CST BRANDS, INC.

CST Service Center

One Valero Way

Building D, 4th Floor

San Antonio, TX 78249

NOTICE OF 2014 ANNUAL MEETING OF STOCKHOLDERS

WEDNESDAY, JUNE 4, 2014

9:00 a.m., Central Time

To the Stockholders of CST Brands, Inc.:

The 2014 Annual Meeting (“2014 Annual Meeting”) of Stockholders of CST Brands, Inc. will be held at the CST Service Center located at One Valero Way, Building D, 4^th Floor, San Antonio, TX 78249, on Wednesday, June 4, 2014, at 9:00 a.m., Central Time. At the meeting you will be asked to:

The Board of Directors recommends you vote FOR each of the director nominees.

The Board of Directors recommends you vote FOR the ratification of the selection of KPMG, LLP.

The Board of Directors recommends you vote FOR the Amended Omnibus Plan.

The Board of Directors recommends you vote FOR the advisory vote to approve executive compensation.

The Board of Directors recommends you vote FOR one year.

The foregoing items of business are more fully described in the Proxy Statement attached to, and part of, this notice.

Only stockholders of record at the close of business on April 14, 2014 are entitled to vote at the 2014 Annual Meeting and any adjournments or postponements thereof. Each share of common stock is entitled to one vote for each director nominee and one vote for each of the proposals to be voted on.

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We will make available for inspection a list of stockholders entitled to vote at the 2014 Annual Meeting at our offices, One Valero Way, Building D, Suite 200, San Antonio, TX 78249 for 10 days prior to the 2014 Annual Meeting. If you would like to review the stockholder list, please call our Investor Relations department at (800) 456-3533 to schedule an appointment.

By Order of the Board of Directors,

Cynthia P. Hill

Corporate Secretary

San Antonio, Texas

April 21, 2014

Important Notice Regarding the Availability of Proxy Materials for the

2014 Annual Meeting of Stockholders to be held June 4, 2014

This Proxy Statement and the Annual Report on Form 10-K for the year

ended December 31, 2013 are available at www.CSTBrands.com,

which does not have “cookies” that identify visitors to the site.

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PROXY STATEMENT SUMMARY

This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2013 carefully before voting.

2014 ANNUAL MEETING OF STOCKHOLDERS

Date, Time and Place:

Wednesday, June 4, 2014

9:00 a.m., Central Time

CST Service Center, One Valero Way, Building D, 4th Floor, San Antonio, TX 78249

Record Date:

April 14, 2014

Voting:

Stockholders as of the Record Date are entitled to vote. Each share of common stock is entitled to one vote for each director nominee and one vote for each of the proposals to be voted on. Instructions on how to vote are found on page 2.

Entry:

You are invited to attend the 2014 Annual Meeting only if you were a CST Brands stockholder as of the close of business on April 14, 2014, the Record Date, or hold a valid proxy for the 2014 Annual Meeting. If you are not a stockholder of record but hold shares through a broker, bank, trustee, or nominee (i.e., in street name), you will need to provide proof of beneficial ownership as of the Record Date, such as your most recent account statement prior to the Record Date, and a copy of the voting instruction form provided by your broker, bank, trustee, or nominee, or similar evidence of ownership.

You will also need to present valid photo identification for admittance. If you do not provide photo identification or comply with the other procedures outlined in this Proxy Statement, you will not be admitted to the 2014 Annual Meeting. For security reasons, you and your bags may be subject to search prior to your admittance to the meeting. Please let us know if you plan to attend the meeting by marking the appropriate box on the enclosed proxy card if you requested to receive printed proxy materials, or, if you vote by telephone or over the internet, by indicating your plans when prompted. If you decide to attend the meeting in person, upon your arrival you will need to register as a visitor with the registration desk at our CST Service Center located at One Valero Way, Building D, San Antonio, TX 78249. See the Proxy Statement for further instructions. Check-in will begin at 8:00 a.m., local time, and you should allow ample time for the check-in procedures.

Quorum:

The holders of a majority of the outstanding shares of common stock issued and entitled to vote at the 2014 Annual Meeting must be present in person or by proxy to establish a quorum for business to be conducted at the 2014 Annual Meeting. Abstentions and “broker non-votes” are treated as shares that are present and entitled to vote for purposes of determining the presence of a quorum.

A “broker non-vote” occurs when you fail to provide your broker with voting instructions and the broker does not have the discretionary authority to vote your shares on a particular proposal because the proposal

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is not a “routine” matter under NYSE rules. A broker non-vote may also occur if your broker fails to vote your shares for any reason. Brokers cannot vote on their customers’ behalf on “non-routine” proposals such as Proposal 1, the election of directors, and Proposals 3, 4 and 5. Because brokers require their customers’ direction to vote on such “non-routine” matters, it is critical that stockholders provide their brokers with voting instructions. Proposal 2, ratification of the selection of our independent registered public accounting firm, will be a “routine” matter for which your broker does not need your voting instruction in order to vote your shares.

Voting Matters:

PROPOSAL ONE: ELECTION OF CLASS I DIRECTORS (Page 7)

The nominees for Director are: Roger G. Burton and Stephen A. Smith

Roger G. Burton. Mr. Burton, a director since April 2013, has been the chair of the Audit Committee. Mr. Burton will continue serving in the same capacity. Mr. Burton is a Certified Public Accountant. He served as a partner of Arthur Andersen LLP from 1981 to 2002. After retiring from Arthur Andersen LLP, Mr. Burton founded his own financial consulting, auditing and litigation support services firm, Roger G. Burton, CPA. Mr. Burton brings invaluable financial expertise to our Board. His pertinent experience, qualifications, attributes, and skills include public accounting and financial reporting expertise (including extensive experience as a CPA) and managerial experience attained from serving as chief executive of his own financial services firm.

Stephen A. Smith. Mr. Smith, a director since March 2014, currently serves as a member of the Audit Committee. Mr. Smith is the former co-CEO of the Toronto-based restaurant chain owner and operator, Cara Operations Limited, a Canadian company that operates several restaurant chains including: Harvey’s, Swiss Chalet, Kelsey’s, Milestones and Montana’s. Mr. Smith is a Chartered Professional Accountant (CPA, CA) in Canada and has extensive operational and managerial experience most recently with Cara. Previously, he served as CFO for the same company for a period of six years. Prior to joining Cara, Mr. Smith served as Executive Vice President at Loblaw Companies Limited (George Weston Limited) and Price Waterhouse. Mr. Smith brings invaluable financial expertise to our Board, especially in relation to our Canadian operations. His pertinent experience, qualifications, attributes, and skills include public accounting and financial reporting expertise (including extensive experience as a CPA) and managerial experience attained from serving as chief executive of Cara.

The Board of Directors recommends that stockholders vote FOR these nominees to the Board of Directors.

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PROPOSAL TWO: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (Page 26)

We are asking our stockholders to ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2014. Set forth below is summary information with respect to the fees paid or accrued by us for the audit and other services provided by KPMG LLP during 2013.

The Board of Directors recommends that stockholders vote FOR this ratification.

PROPOSAL THREE: APPROVAL OF THE AMENDED AND RESTATED 2013 OMNIBUS STOCK AND INCENTIVE PLAN (Page 29)

We are asking our stockholders to approve the CST Brands’ Amended and Restated 2013 Omnibus Stock and Incentive Plan (“Amended Omnibus Plan”), which has been amended to, among other things, reduce the percentage of available shares from 70% under the existing 2013 Omnibus Stock Incentive Plan (“Existing Omnibus Plan”) to 65% pursuant to which awards may be made under the Amended Omnibus Plan in the form of full value shares, to clarify certain provisions relating to performance based awards and to implement certain administrative amendments.

The Board of Directors recommends that stockholders vote FOR the amendment and restatement of the Existing Omnibus Plan.

PROPOSAL FOUR: ADVISORY VOTE ON EXECUTIVE COMPENSATION (Page 37)

As required by the SEC’s proxy rules, we are seeking an advisory, non-binding stockholder vote with respect to compensation awarded to our Named Executive Officers for 2013. Our executive compensation program and compensation paid to our Named Executive Officers are described in the Compensation Discussion and Analysis section starting on page 38 of this Proxy Statement. The Compensation Committee is responsible for executive compensation and works to structure a compensation plan that reflects CST Brands’ underlying compensation philosophy of aligning the interests of our Named Executive Officers with those of our stockholders. For more information related to compensation see pages 37 to 60.

The Board of Directors recommends that stockholders vote FOR the advisory vote approving executive compensation.

PROPOSAL FIVE: FREQUENCY OF ADVISORY VOTE ON COMPENSATION (Page 61)

As required by the SEC’s proxy rules, we are seeking an advisory, non-binding stockholder vote with respect to the future frequency of the advisory vote of compensation awarded to our Named Executive Officers.

The Board of Directors recommends that stockholders vote ONE YEAR for the frequency of future advisory votes on executive compensation.

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CST BRANDS, INC.

One Valero Way, Building D, Suite 200

San Antonio, Texas 78249

(210) 692-5000

PROXY STATEMENT

2014 ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD JUNE 4, 2014

The Board of Directors of CST Brands, Inc. (“we”, “our”, “CST Brands” or the “Company”) is soliciting proxies to vote shares of common stock at the 2014 Annual Meeting of Stockholders of CST Brands (“2014 Annual Meeting”). The 2014 Annual Meeting will be held at 9:00 a.m., Central Time, on Wednesday, June 4, 2014, at the CST Service Center located at One Valero Way, Building D, 4^th Floor, San Antonio, TX 78249, and at any adjournment thereof.

This Proxy Statement and the accompanying proxy materials including the proxy card are first being distributed and made available to stockholders on or about April 21, 2014, the mailing date. For ten days prior to the 2014 Annual Meeting, a complete list of stockholders entitled to vote at the 2014 Annual Meeting will be available for examination by any stockholder for any purpose relevant to the 2014 Annual Meeting during regular business hours at CST Brands’ offices, located at the address set forth above. If you would like to review the stockholder list, please call our Investor Relations department at (800) 456-3533 to schedule an appointment.

Availability of Proxy Materials for the 2014 Annual Meeting of Stockholders of CST Brands. The Notice of 2014 Annual Meeting, Proxy Statement, Proxy Card and Annual Report on Form 10-K for the year ended December 31, 2013 are available at http://www.astproxyportal.com/ast/18249/ and at the Company’s website http://www.cstbrands.com/en-us/investors.

Record Date; Shares Entitled To Vote; Quorum: Only holders of common stock of the Company (“Common Stock”) as of the close of business on April 14, 2014, (the “Record Date”), are entitled to vote at the 2014 Annual Meeting. Stockholders are entitled to one vote for each share of Common Stock held as of the Record Date. On the Record Date, there were 75,759,786 shares of Common Stock issued and outstanding, which were held by approximately 5,770 holders of record. The holders of a majority of the outstanding shares of CST Brands common stock issued and entitled to vote at the 2014 Annual Meeting must be present in person or by proxy to establish a quorum for business to be conducted at the 2014 Annual Meeting. Abstentions and “broker non-votes” are treated as shares that are present and entitled to vote for purposes of determining the presence of a quorum.

A “broker non-vote” occurs when a stockholder fails to provide their broker with voting instructions and the broker does not have the discretionary authority to vote a stockholder’s shares on a particular proposal because the proposal is not a “routine” matter under NYSE rules. A broker non-vote may also occur if a stockholder’s broker fails to vote a stockholder’s shares for any reason. Brokers cannot vote on their customers’ behalf on “non-routine” proposals such as Proposal 1, the election of directors, and Proposals 3, 4 and 5. Because brokers require their customers’ direction to vote on such “non-routine” matters, it is critical that stockholders provide their brokers with voting instructions. Proposal 2, ratification of the selection of our independent registered public accounting firm, will be a “routine” matter for which your broker does not need your voting instruction in order to vote your shares.

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PROXY MATERIALS AND VOTING INFORMATION

The proxy materials for our 2014 Annual Meeting of Stockholders include the Notice of 2014 Annual Meeting, this Proxy Statement, our Annual Report on Form 10-K for the year ended December 31, 2013 (the “Form 10-K”) and a proxy card or voting instruction form. A Proxy Statement is a document that SEC’s regulations require us to give you when we ask for your vote. A proxy is your legal designation of another person to vote the stock you own. If you designate someone as your proxy in a written document, that document also is called a proxy card.

The proxies identified on the proxy card will vote the shares of which you are stockholder of record in accordance with your instructions. If you sign and return your proxy card without giving specific voting instructions, the proxies will vote your shares “FOR” the nominated director, “FOR” one year with respect to Proposal 4 and “FOR” each of the other proposals. The giving of a proxy will not affect your right to vote in person if you decide to attend the meeting.

Stockholder of Record. If your shares are registered directly in your name or with our transfer agent, American Stock Transfer & Trust Company, LLC (“AST”), you are considered the stockholder of record with respect to those shares. As a stockholder of record, you have the right to grant your voting proxy directly to us or to vote in person at the 2014 Annual Meeting. We have provided a proxy card for your use.

Beneficial Holder. If your shares are held in a brokerage account or by a bank, broker or other nominee, you are considered the beneficial owner of the shares held in street name, and these proxy materials are being forwarded to you by your broker, bank or other nominee who is considered the stockholder of record with respect to those shares. As the beneficial owner, you have the right to direct your broker on how to vote and are also invited to attend the meeting. However, since you are not the stockholder of record, in order to vote these shares in person at the meeting you must obtain a legal proxy from your broker, bank or other nominee. Your broker, bank or other nominee will provide a proxy card for your use.

If you are a stockholder of record, you will receive a notice of internet availability of the proxy materials. You may receive more than one notice; this means that you have multiple accounts at the transfer agent or at brokers. Please complete each of the proxies which you receive.

If you hold shares of Common Stock in the CST Brands, Inc. Savings Plan (“CST Brands Savings Plan”) and do not timely vote your shares or specify your voting instructions on your proxy card, the plan administrator will vote your shares in accordance with the terms of the plan. To allow sufficient time for voting by the plan administrator, if applicable, your voting instructions must be received by May 30, 2014.

If you are a beneficial owner, you will receive voting instruction information from the bank, broker or other nominee through which you own your shares of Common Stock.

You may vote your shares in person at the 2014 Annual Meeting or by proxy. There are three ways to vote by proxy: (1) by Internet by following the instructions on this Notice or proxy card, (2) by telephone by calling 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from foreign countries from any touch-tone telephone and following the instructions, or (3) by requesting a printed copy of the proxy materials and signing, dating and mailing the enclosed proxy card in the envelope provided with our proxy card. If your

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shares are held in the name of a bank, broker or other holder of record, you will receive instructions from the holder of record. You must follow the instructions of the holder of record in order for your shares to be voted. Beneficial owners may vote by telephone or Internet if their bank, broker or other nominee makes those methods available, in which case the bank, broker or other nominee will include the instructions with the proxy materials.

Vote In Person. All stockholders of record may vote in person at the meeting, only if you were a CST Brands stockholder as of the close of business on the Record Date, or you hold a valid proxy for the 2014 Annual Meeting. If you are a beneficial owner and want to vote your shares at the 2014 Annual Meeting, you will need to ask your bank, broker or other nominee to furnish you with a legal proxy. You will need to provide proof of beneficial ownership as of the Record Date, such as your account statement, a copy of the voting instruction card provided by your broker, bank, trustee or nominee, or other similar evidence of ownership.

Vote By Internet. All stockholders of record can vote through the Internet, by going to the web address http://www.voteproxy.com and following the instructions for Internet voting. Have your proxy card available when you access the web page. If you vote by Internet, please do not mail your proxy card. The deadline for voting electronically through the internet is 11:59 p.m., Eastern Time, on June 3, 2014.

Vote By Telephone. All stockholders of record can vote by telephone by dialing 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from foreign countries from any touch-tone telephone and following the instructions. Have your proxy card available when you call. If you vote by telephone, please do not mail your proxy card. The deadline for voting by telephone is 11:59 p.m., Eastern Time, on June 3, 2014.

Vote by Written Proxy. All stockholders of record can vote by written proxy card. If you are a stockholder of record and receive a notice regarding the availability of proxy materials, you may request a written proxy card by following the instructions included in the notice. If you are a beneficial owner, you may request a written proxy card or a vote instruction form from your bank, broker or other nominee. Your vote, if delivered by mail, must be received by 11:59 p.m. Eastern Standard Time on June 3, 2014 in order to be counted.

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Stockholders of record should specify their choice for each matter on the proxy card. If no specific instructions are given, proxies which are signed and returned will be voted:

If you are a beneficial owner, under the rules of the NYSE, in order to ensure your shares are voted in the way you would like, you must provide voting instructions to your bank, broker or other nominee by the deadline provided in the materials you receive from your bank, broker or other nominee. If you do not provide voting instructions to your bank, broker or other nominee, whether your shares can be voted by such person depends on the type of item being considered for vote.

Non-Routine Items. The election of Directors, the approval of the Amended Omnibus Plan, the advisory vote to approve executive compensation, and the advisory vote on the frequency of the vote on executive compensation are non-discretionary items and may not be voted on by brokers, banks or other nominees who have not received specific voting instructions from beneficial owners.

Routine (Discretionary) Items. The ratification of the selection of KPMG LLP as Independent Registered Accounting Firm is a discretionary item. Generally, banks, brokers and other nominees that do not receive voting instructions from beneficial owners may vote on this proposal in their discretion.

Whether you vote by telephone, internet or by mail, you can change or revoke your proxy before it is voted at the meeting by:

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The Notice of 2014 Annual Meeting, Proxy Statement, Proxy Card and the Annual Report on Form 10-K for the year ended December 31, 2013 are available at http://www.astproxyportal.com/ast/18249/. In addition, stockholders are able to access these documents on the Company’s website http://www.cstbrands.com/en-us/investors.

In connection with its 2014 Annual Meeting of Stockholders, CST Brands has elected to use the Notice of Internet Availability of Proxy Material to inform stockholders of among other matters:

We are pleased to take advantage of the SEC rule allowing companies to furnish proxy materials to their stockholders over the internet. We believe that internet availability of proxy materials allows us to save some trees and operating expenses and get you more room in your mailbox at the same time. We call that a “win win” situation. However, paper copies of the proxy materials are available upon your request. They will be mailed within three business days of receipt of your request and by first class mail.

We have retained AST to be the independent tabulator to receive and tabulate the proxies as well as the independent inspector of election to certify the results.

Preliminary results will be announced at the 2014 Annual Meeting. The Company will report the final results on the Form 8-K filed with the SEC.

The cost of soliciting proxies in the accompanying form will be borne by CST Brands. Proxies may be solicited by mail, telephone, fax, email, press releases, press interviews or the Company’s Investor Relations website. In addition to solicitations by mail, a number of officers, directors and regular employees of ours may, at no additional expense to us, solicit proxies in person or by telephone. We have hired Georgeson Inc. to assist in the solicitation of proxies at a base fee or $9,500, plus additional amounts, which will vary depending upon the extent of services actually performed by Georgeson, plus reimbursement for reasonable out-of-pocket expenses. Our officers and employees may solicit proxies personally, by telephone or other telecommunications with some stockholders if proxies are not received promptly. We will also make arrangements with brokerage firms, banks and other nominees to forward proxy materials to beneficial owners of shares and will reimburse such nominees for their reasonable costs.

For participants in the CST Brands Savings Plan, the proxy card will represent (in addition to any shares held individually of record by the participant) the number of shares allocated to the participant’s account in the CST Brands Savings Plan. For shares held by the CST Brands Savings Plan, the proxy card will constitute an instruction to the trustee of the plan on how to vote those shares. Shares for which instructions are not received may be voted by the plan administrator per the terms of the plan.

If you have any questions about voting your shares, please contact our proxy solicitor, Georgeson Inc., toll free at (800) 932-9864.

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The SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy materials with respect to two or more stockholders sharing the same address by delivering a single set of proxy materials, unless the stockholders have notified the Company of their desire to receive multiple copies of the Proxy Statement. This is known as householding.

CST Brands has decided to use this householding process in all of our future stockholder communications. You have received notice of this decision in the package including the Notice of Internet Availability of Proxy Material. Accordingly, unless we hear otherwise from you (or we elect to stop householding) you and members of your household will receive only one copy of all of our future stockholder communications, with the exception that we will continue to provide you with a separate proxy card for each registered stockholder account.

If you wish to receive individual copies of any stockholder communications, please contact AST at either (800) 937-5449 or via email at info@amstock.com within the next 60 days. Additionally, if you decide later on that you miss the stacks of paper and multiple copies, you can always change your mind and revoke your consent at any time by contacting AST.

Beneficial owners should contact their broker or bank if they do not wish to participate in their householding programs.

All attendees will need to bring a photo ID to gain admission. Attendance at the meeting is limited to stockholders as of the Record Date (April 14, 2014) or their authorized named representatives.

If you have questions regarding these admission procedures, please call our Investor Relations team at (800) 456-3533.

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PROPOSAL ONE

ELECTION OF CLASS I DIRECTORS

CST Brands’ Articles of Incorporation divide the Board of Directors into three classes of directors serving staggered three-year terms, with one class to be elected at each annual meeting. At this year’s meeting, two Class I directors, whose current terms expire in 2014, are to be elected for a term of three years to hold office until the expiration of the next term for Class I directors in 2017, or until a successor has been elected and duly qualified. The nominees for Class I director are Roger G. Burton and Stephen A. Smith, both current directors of CST Brands.

The director nominees named in this Proxy Statement have agreed to serve as directors if elected, and we have no reason to believe that they will be unable to serve. In the event that before the 2014 Annual Meeting the nominees named in this Proxy Statement should become unable or unwilling to serve, the persons named in the enclosed proxy will vote the shares represented by any proxy received by our Board of Directors for such other person or persons as may thereafter be nominated for director by the Nominating and Governance Committee and our Board of Directors. Assuming the presence of a quorum, the nominees for director who receive the most votes will be elected.

The enclosed proxy card provides a means for stockholders to vote for or to withhold authority to vote for the nominees for director. If a stockholder executes and returns a proxy, but does not specify how the shares represented by such stockholder’s proxy are to be voted, such shares will be voted FOR the election of the nominees for director. In determining whether this item has received the required number of affirmative votes, abstentions will have no effect. Non-votes are not considered votes cast “for” or “against” this proposal at the 2014 Annual Meeting and will have no effect on the approval to elect directors.

Board of Directors

The following table sets forth the names, ages, positions and class of the directors of CST Brands. The term of the Class I directors expires in 2014 (and are nominated for election for a new three-year term as noted herein), the term of the Class II directors expires in 2015 and the term of the Class III directors expires in 2016.

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Director Nominees

Roger G. Burton. Mr. Burton is a Certified Public Accountant. He served as a partner of Arthur Andersen LLP from 1981 to 2002. After retiring from Arthur Andersen LLP, Mr. Burton founded his own financial consulting, auditing and litigation support services firm, Roger G. Burton, CPA. Mr. Burton, who serves on our Audit Committee, brings invaluable financial expertise to our Board. His pertinent experience, qualifications, attributes, and skills include public accounting and financial reporting expertise (including extensive experience as a CPA) and managerial experience attained from serving as chief executive of his own financial services firm. Mr. Burton was elected to CST Brands’ Board of Directors in April 2013.

Stephen A. Smith. Mr. Smith is the former co-CEO of the Toronto-based restaurant chain owner and operator, Cara Operations Limited, a Canadian company that operates several restaurant chains including: Harvey’s, Swiss Chalet, Kelsey’s, Milestones and Montana’s. Mr. Smith is a Chartered Professional Accountant (CPA, CA) in Canada and has extensive operational and managerial experience, most recently with Cara. Previously, he served as CFO for the same company for a period of six years. Prior to joining Cara, Mr. Smith served as Executive Vice President at Loblaw Companies Limited (George Weston Limited) for twenty-two years and Price Waterhouse. Mr. Smith brings invaluable financial, operational and managerial expertise to our Board, especially in relation to our Canadian operations. His pertinent experience, qualifications, attributes, and skills include public accounting and financial reporting expertise (including extensive experience as a CPA) and managerial experience attained from serving as chief executive of Cara. Currently Mr. Smith serves as a director and chair of the Audit and Finance Committee for the Metro Toronto Convention Center and St. Michael’s Hospital Foundation. Mr. Smith was elected to CST Brands’ Board of Directors in March 2014.

The Board of Directors recommends a vote “FOR” the Board’s nominees for Class I Director.

Directors with Terms Expiring in 2015 and 2016

Donna M. Boles. Ms. Boles, prior to her retirement, was Senior Vice President, Human Resources of Becton, Dickinson and Company, a global medical technology company, from 2005 until August 31, 2013. Prior to that, Ms. Boles served as Vice President, Human Resources for the BD Medical division since 2001. She joined Becton, Dickinson and Company in 1973 and served in progressively responsible roles across multiple business segments since. Ms. Boles’ pertinent experience, qualifications, attributes and skills include the knowledge and management experience (including extensive experience in executive compensation and leadership succession planning) she has attained through her years of service as an officer of a global, publicly traded corporation. Ms. Boles was elected to CST Brands’ Board of Directors in April 2013.

Kimberly S. Bowers. Ms. Bowers’ biographical information is provided below under the caption “Named Executive Officers.” Ms. Bowers’ pertinent experience, qualifications, attributes and skills include the knowledge and experience she has attained through her service, with extensive and varied responsibilities, as an executive officer of Valero Energy Corporation (“Valero”) for more than six years and the knowledge and experience she has attained from her service on another public company board. Ms. Bowers was elected to CST Brands’ Board of Directors in November 2012.

Ruben M. Escobedo. Mr. Escobedo is a Certified Public Accountant. He owned and operated his public accounting firm, Ruben Escobedo & Company, CPAs, in San Antonio, Texas since its formation in 1977 through 2007. Mr. Escobedo also serves as a director of Cullen/Frost Bankers, Inc., a position he has held since 1996, and he has served as a director of Valero from 1994 to May 2014 including service as the Chairman of the Audit Committee and a member of the Executive Committee. Mr. Escobedo’s pertinent experience, qualifications, attributes, and skills include public accounting and financial reporting expertise (including extensive experience as a CPA), managerial experience attained from serving as chief executive of his own accounting firm, the knowledge and experience he has attained from service on the boards of Cullen/Frost Bankers, Inc. and Valero. Mr. Escobedo was elected to CST Brands’ Board of Directors in April 2013.

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Denise Incandela. Ms. Incandela is President of Digital and Global E-commerce for the Ralph Lauren Corporation where she oversees global e-commerce, digital marketing, social media, customer relationship marketing, customer analytics, and all omni channel initiatives. Previously, Ms. Incandela served as the Executive Vice President and Chief Marketing Officer of Saks Fifth Avenue, where she oversaw Saks Direct and Saks Fifth Avenue’s marketing programs including, advertising, sales promotions, loyalty, digital marketing / social media, customer analytics and market research. She joined Saks in 1999 to build and launch Saks.com from the ground up and was instrumental in driving Saks’ significant digital presence and e-commerce growth. Previously, Ms. Incandela worked at McKinsey & Company’s New York Office, where she was a leader of their Retail practice and served Saks Fifth Avenue as a consultant for five years. Prior to joining McKinsey, Ms. Incandela worked at Shearson Lehman Brothers and American Express. Ms. Incandela is also a member of the Board of Advisors for The Wharton School’s Jay H. Barker Retailing Center. Ms. Incandela’s pertinent experience, qualifications, attributes and skills include management experience, retail expertise, and perspective gained through her positions described above. She was elected to CST Brands’ Board of Directors in June 2013.

William G. Moll. Mr. Moll, prior to his retirement, was President and Chief Executive Officer of Alamo Public Telecommunications Council (KLRN-TV, San Antonio, Texas) from 2009 to 2012. From 2000 to 2009, Mr. Moll served in various roles at Clear Channel Communications, Inc., including as President and Chief Executive Officer of Clear Channel Television from 2000 to 2006 and as Chairman of Clear Channel Television from 2006 to 2009. Mr. Moll’s pertinent experience, qualifications, attributes, and skills include the knowledge and experience (particularly his expertise in communications and advertising) he has attained through his years of service as an officer of publicly traded corporations and telecommunications organizations. Mr. Moll was elected to CST Brands’ Board of Directors in April 2013.

Alan Schoenbaum. Mr. Schoenbaum is our lead independent director. Prior to his retirement, Mr. Schoenbaum was Senior Vice President and General Counsel at Rackspace Hosting, Inc., a publicly traded cloud computing company based in San Antonio, Texas, from December 2005 until February 2014. He is currently serving as special counsel to Rackspace. Prior to joining Rackspace, Mr. Schoenbaum was a partner at Akin Gump Strauss Hauer & Feld LLP. He has more than 25 years of experience in corporate and securities law and mergers and acquisitions. Mr. Schoenbaum’s pertinent experience, qualifications, attributes, and skills include the knowledge and experience (particularly his expertise in mergers and acquisitions) he has attained through his years of service as an officer of a publicly traded corporation and as partner of a major law firm. Mr. Schoenbaum was elected to CST Brands’ Board of Directors in April 2013.

Michael Wargotz. Mr. Wargotz has served since July 2011 as the Chairman of Axcess Ventures, an affiliate of Axcess Worldwide, a business development agency for prestige and ultra-luxury brands. From August 2010 to June 2011, Mr. Wargotz served as the Chief Financial Officer of The Milestone Aviation Group, LLC, a global aviation leasing company. From August 2009 to July 2010, Mr. Wargotz served as the Co-Chairman of Axcess Luxury and Lifestyle. From December 2006 to August 2009, Mr. Wargotz served as the Chief Financial Advisor of NetJets, Inc., an aviation services provider, and from June 2004 to November 2006, he was a Vice President of NetJets. Mr. Wargotz is a founding partner of Axcess Solutions, LLC, a strategic alliance, brand development and partnership marketing consulting firm, which originated in 2001. Mr. Wargotz also serves as a director of the publicly traded companies, Wyndham Worldwide Corporation and Resources Connection Inc. Mr. Wargotz’s pertinent experience, qualifications, attributes and skills include management experience, financial expertise, branding knowledge and compliance expertise and perspective gained through his responsibilities with the companies described above. Mr. Wargotz was elected to CST Brands’ Board of Directors in April 2013.

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Composition of the Board of Directors

The Company believes that its Board as a whole should encompass a diverse range of talent, skill, experience and expertise enabling it to provide sound guidance with respect to the Company’s operations and business goals. In addition to considering a candidate’s background and accomplishments, candidates are reviewed in the context of the current composition of the Board and the evolving needs of the Company. The Company’s policy is to have at least a majority of its directors qualify as “independent” as determined in accordance with the listing standards of NYSE and Rule 10A-3 of the Exchange Act.

The Nominating and Governance Committee solicits recommendations for potential Board candidates from a number of sources, including members of the Board, our executive officers, professional colleagues, individuals personally known to the members of the Board, and third-party executive search firms. In addition, the Nominating and Governance Committee will consider candidates recommended by stockholders. In evaluating candidates, the Nominating and Governance Committee will take into consideration the needs of the Board and the qualifications of the candidates. The Nominating and Governance Committee’s evaluation process does not vary based on whether or not a candidate is recommended by a stockholder or another source.

The Nominating and Governance Committee considers a number of factors in its evaluation of director candidates, including the members of our Board of Directors eligible for reelection, the current size and composition of the Board and the needs of the Board and the respective committees of the Board. The

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Nominating and Governance Committee also looks at such factors as judgment, independence, character and integrity, area of expertise, diversity of experience, length of service, and potential conflicts of interest. The Nominating and Governance Committee also considers diversity concepts such as race, gender, and national origin, professional experience and differences in viewpoints and skills. The Nominating and Governance Committee does not have a formal policy with respect to diversity; however the Board and the Nominating and Governance Committee believe that it is essential that the Board members represent diverse viewpoints.

Once a person has been identified by the Nominating and Governance Committee as a potential candidate, the Nominating and Governance Committee may collect and review publicly available information regarding the person to assess whether the person should be considered further. If the Nominating and Governance Committee determines that the candidate warrants further consideration, the chairman or another member of the Nominating and Governance Committee would contact the person. Generally, if the person expresses a willingness to be considered and to serve on the Board, the Nominating and Governance Committee requests information from the candidate, reviews the person’s accomplishments and qualifications, including in light of any other candidates that the Nominating and Governance Committee might be considering. Based on its initial evaluation, the Nominating and Governance Committee will determine whether to interview a proposed candidate and, if warranted, will recommend that one or more of its members, other members of the Board, or senior management, as appropriate, may conduct one or more interviews with the candidate. In certain instances, the Nominating and Governance Nominating and Governance Committee members or other Board members may request a background check, may contact one or more references provided by the candidate or may contact other members of the business community or other persons that may have greater first-hand knowledge of the candidate’s accomplishments. After completing this process, the Nominating and Governance Committee ultimately determines which nominees to submit to the full Board for consideration and approval.

With respect to each of our current directors and director nominees, their biographies on pages 8 and 9 detail their individual experience together with their past and current board positions and experience.

Meeting Attendance

During the fiscal year ended December 31, 2013, the Board of Directors held three meetings, the Audit Committee held nine meetings; the Compensation Committee held six meetings and the Nominating and Governance Committee held three meetings. During 2013, each current member of the Board of Directors attended all Board and all applicable Committee meetings and, other than Ms. Bowers, our Chairman of the Board, President and Chief Executive Officer, each director received compensation for service to CST Brands for his or her role as director. See “Executive Compensation—Compensation of Directors.” CST Brands encourages, but does not require, directors to attend the 2014 Annual Meeting of stockholders; however, such attendance allows for direct interaction between stockholders and members of the Board of Directors.

Independent Directors

The Board presently has one member from our management, Kimberly S. Bowers, and 8 non-management directors. The Board determined the following non-management directors meet the independence requirements of the NYSE listing standards as set forth in the NYSE Listed Company Manual and Rule 10A-3 of the Exchange Act: Donna M. Boles, Roger G. Burton, Ruben M. Escobedo, Denise Incandela, William G. Moll, Alan Schoenbaum, Stephen A. Smith and Michael H. Wargotz. The Board’s Audit, Compensation, and Nominating and Governance Committees are composed entirely of directors who meet the independence requirements of the NYSE’s listing standards. Under the NYSE’s listing standards, no director qualifies as independent unless the Board affirmatively determines that he or she has no material relationship with CST Brands. Based upon information requested from and provided by each director concerning their background, employment, and affiliations, including commercial, banking, consulting, legal, accounting, charitable, and familial relationships, the Board has determined that, other than being a director and/or stockholder of CST Brands, each of the independent directors named above has either no relationship with CST Brands, either directly or as a partner,

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stockholder, or officer of an organization that has a relationship with CST Brands, or has only immaterial relationships with CST Brands, and is independent under the NYSE’s listing standards.

In accordance with the NYSE’s listing standards, the Board has adopted categorical standards or guidelines to assist the Board in making its independence determinations regarding its directors. These standards are published in Article I of the Company’s Corporate Governance Guidelines and are available on the CST Brands’ website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section. Under the NYSE’s listing standards, immaterial relationships that fall within the guidelines are not required to be disclosed in this Proxy Statement. An immaterial relationship falls within the guidelines if it:

Committees of the Board of Directors

CST Brands has standing Audit, Compensation and Nominating and Governance Committees. The members of the committees are as follows:

Audit Committee

The Audit Committee is a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Board of Directors has determined that each of Messrs. Burton (Chair), Escobedo and Smith are audit committee financial experts as defined by SEC rules. The Audit Committee Report, which begins on page 27, more fully describes the activities and responsibilities of the Audit Committee. Mr. Clay Killinger, our Chief Financial Officer, Ms. Tammy Floyd, our Vice President and Controller, and Mr. Kevin Sheehan, our Vice President of Internal Audit and Risk Management, and representatives from KPMG, LLP, the Company’s independent registered public accounting firm, generally attend each meeting. In addition, the representatives from KPMG, LLP and the Audit Committee meet in executive session at each meeting.

A more detailed discussion of the Audit Committee’s mission, composition and responsibilities is contained in the Audit Committee Charter, which is available on our website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section.

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Compensation Committee

The Compensation Committee satisfies the independence requirements set forth in the applicable listing standards of the SEC and the NYSE and the requirements set forth in the Compensation Committee charter.

The Compensation Committee’s role is to establish and oversee CST Brands’ compensation and benefit plans and policies, administer its stock option plans, annually review and recommend to the independent members of our Board for approval all compensation decisions relating to CST Brands’ Chief Executive Officer, and annually review and approve all compensation decisions for our other Named Executive Officers.

The agenda for meetings of the Compensation Committee is determined by its Chair. The Company’s Human Resources department supports the Compensation Committee in the execution of its responsibilities. The Company’s Senior Vice President, Human Resources supervises the development of the materials for each Compensation Committee meeting, including market data, individual and Company performance metrics and compensation recommendations for consideration by the Compensation Committee. The Chair of the Compensation Committee reports decisions and recommendations on executive compensation to the independent members of the Board. The Compensation Committee has authority under its charter to retain, approve fees for and terminate advisors, consultants and agents as it deems necessary to assist in the fulfillment of its responsibilities. For more information on the Compensation Committee’s processes and procedures, please see “Compensation Discussion and Analysis – Roles in Making Compensation Decisions – Compensation Committee,” “– Compensation Consultants,” and “– Management”.

A more detailed discussion of the Compensation Committee’s mission, composition and responsibilities is contained in the Compensation Committee Charter, which is available on CST Brands’ website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section.

Nominating and Governance Committee

The principal functions of the Nominating and Governance Committee include:

The Nominating and Governance Committee satisfies the independence requirements set forth in the applicable listing standards of the SEC and the NYSE and requirements set forth in the Nominating and Governance Committee charter.

A more detailed discussion of the Nominating and Governance Committee’s mission, composition and responsibilities is contained in the Nominating and Governance Committee Charter, which is available on our website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section.

Board Leadership Structure

As prescribed by the Company’s bylaws, the Chairman of the Board has the power to preside at all meetings of the Board. The Board of Directors believes that our Chief Executive Officer is best situated to serve as Chairman because she is the director most familiar with CST Brands’ business and industry, and most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy. The Board believes this provides an efficient and effective leadership model for CST Brands. The Board believes that

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combining the Chairman and Chief Executive Officer roles fosters clear accountability, effective decision-making and alignment on corporate strategy. Although the Board believes that the combination of the Chairman and Chief Executive Officer roles is appropriate in the current circumstances, CST Brands’ Corporate Governance Guidelines do not establish this approach as a policy.

Our Board structure also fosters strong oversight by independent directors. Ms. Bowers is the only member of management (past or present) who serves on the Board, and all of our other directors are fully independent. Each of the Board’s committees is chaired by an independent director. To assure effective independent oversight, the Board has adopted a number of governance practices, including:

Our Board appoints a “Lead Director,” whose responsibilities include leading the meetings of the independent members of our Board outside the presence of management. Immediately following CST Brands becoming publicly traded in 2013, the Board appointed Mr. Schoenbaum to serve in this capacity to provide the Board with additional independent oversight. Our Board regularly meets in executive session outside the presence of management, generally at each Board meeting and Mr. Schoenbaum leads these regularly held executive sessions.

The Lead Director, working with committee chairpersons, sets the agenda and leads the discussion of regular meetings of the Board outside the presence of management, provides feedback regarding these meetings to the Chairman, and otherwise serves as liaison between the independent directors and the Chairman. If necessary, the Lead Director is also responsible for receiving, reviewing, and acting upon communications from stockholders or other interested parties when those interests should be addressed by a person independent of management. The Board believes that the combined role of Chairman and Chief Executive Officer with the utilization of a Lead Director is in the best interest of CST Brands stockholders because it provides the appropriate balance between strategic development and independent oversight of management.

The Board of Directors periodically conducts a self-evaluation on key Board and committee-related issues, which is beneficial in the process of continuous improvement in Board functioning and communication.

Risk Management

The Board of Directors, together with the Compensation Committee, the Audit Committee, and the Nominating and Governance Committee, coordinate with each other to provide company-wide oversight of our management and handling of risk. These committees report regularly to the entire Board of Directors on risk-related matters and provide the Board of Directors with integrated insight about the Company’s management of strategic, credit, interest rate, financial reporting, liquidity, compliance and operational risks.

The Board of Directors has an active role, as a whole and also at the committee level, in overseeing management of the Company’s risks. The Board reviews quarterly information regarding the Company’s credit, liquidity and operations, as well as the risks associated with each. The Company’s Compensation Committee is responsible for overseeing the management of risks relating to the Company’s executive compensation plans and arrangements to ensure that the compensation programs do not encourage excessive risk-taking. The Audit Committee oversees management of financial risks, as well as other identified risks, including information technology. One of the Audit Committee’s responsibilities, as set forth in its charter, is to discuss with management the major financial risk exposures and the steps management has taken to monitor and control those exposures, including our risk assessment and risk management policies. In this regard, our Vice President of Internal Audit and Risk Management prepares annually a comprehensive risk assessment report and reviews that

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report with the Audit Committee. This report identifies the material business risks for CST Brands, and identifies CST Brands’ internal controls that respond to and mitigate those risks. CST Brands’ management regularly evaluates these controls, and the Audit Committee is provided regular updates regarding the effectiveness of the controls. The Audit Committee also reviews with management the Company’s financial arrangements, liquidity and off-balance sheet structures (if any). The Nominating and Governance Committee manages the risks associated with the independence of the Board of Directors and potential conflicts of interest. While each committee is responsible for evaluating specific risks and overseeing the management of such risks, the entire Board of Directors is regularly informed through committee reports about such risks.

At meetings of the Board of Directors and its committees, directors receive regular updates from management regarding risk management. Outside of formal meetings, the Board, its committees and individual Board members have regular access to the executive officers of CST Brands.

Compensation Committee Interlocks and Insider Participation

Ms. Boles, Ms. Incandela and Mr. Schoenbaum served on the Compensation Committee during 2013. No member of the Compensation Committee was at any time during 2013 or at any other time an officer or employee of CST Brands, and no member had any relationship with CST Brands requiring disclosure as a related-party transaction in the section “Certain Relationships and Related Transactions” of this Proxy Statement. No executive officer of CST Brands has served on the Board of Directors or compensation committee of any other entity that has or has had one or more executive officers who served as a member of the Board of Directors or the Compensation Committee during 2013.

Code of Ethics

In April 2013, the Board of Directors unanimously approved CST Brands’ Code of Business Conduct and Ethics. This Code is a statement of CST Brands’ high standards for ethical behavior, legal compliance and financial disclosure, and is applicable to all directors, officers, and employees. A copy of the Code of Ethics can be found in its entirety on CST Brands’ website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section.

Additionally, we post any waiver of a provision of the Code of Ethics granted to any executive officer or director or material amendment to the Code of Ethics on our website at the address noted above.

Stockholder Communications with the Board

The Board of Directors has implemented a process by which stockholders may communicate with the Board of Directors. Stockholders and interested parties may write or call our Board of Directors by contacting our Corporate Secretary as provided below:

Relevant communications will be distributed to the Board of Directors or to any individual director or directors, as appropriate; however, threatening, illegal or similarly unsuitable communications will be excluded. Any communication that is filtered out will be made available to any outside director upon request.

The Corporate Secretary has been instructed by the Board to promptly forward to the members of the Board any relevant communications received.

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Nominations

The Nominating and Governance Committee is responsible for determining the slate of director nominees for election by stockholders, which the Nominating and Governance Committee then recommends to the Board. All director nominees are approved by the Board prior to the annual proxy material preparation and recommended for election by the stockholders at the next annual meeting. For positions on the Board created by a director’s leaving the Board prior to the expiration of his current term, whether due to death, resignation, or other inability to serve, under Article II of the Company’s Amended and Restated Bylaws, a director elected to fill such a vacancy shall hold office for a term expiring at the annual meeting at which the term of the class to which they shall have been elected expires.

The Nominating and Governance Committee does not currently utilize the services of any third party search firm to assist in the identification or evaluation of Board member candidates, although it may do so should it deem necessary or appropriate at the time in question.

The Nominating and Governance Committee determines the required selection criteria and qualifications of director nominees based upon the needs of the Company at the time nominees are considered. A candidate must possess the ability to apply good business judgment and be in a position to properly exercise his or her duties of loyalty and care. Candidates should also exhibit proven leadership capabilities, high integrity and experience with a high level of responsibility within his or her chosen fields, and have the ability to quickly understand complex business and financial principles. Candidates with potential conflicts of interest or who do not meet independence criteria will be identified and disqualified. The Nominating and Governance Committee will consider these criteria for nominees identified by the Nominating and Governance Committee, by stockholders, or through some other source. When current Board members are considered for nomination for re-election, the Nominating and Governance Committee also takes into consideration their prior Board contributions, performance and meeting attendance records.

The Nominating and Governance Committee considers a number of factors in its evaluation of director candidates, including the members of our Board of Directors eligible for reelection, the current size and composition of the Board and the needs of the Board and the respective committees of the Board; and such factors as judgment, independence, character and integrity, area of expertise, diversity of experience, length of service, and potential conflicts of interest. The Nominating and Governance Committee also considers diversity concepts such as race, gender, and national origin, professional experience and differences in viewpoints and skills. The Nominating and Governance Committee does not have a formal policy with respect to diversity; however the Board and the Nominating and Governance Committee believe that it is essential that the Board members represent diverse viewpoints.

The Nominating and Governance Committee will consider qualified candidates for possible nomination that are recommended by stockholders. Stockholders wishing to make such a recommendation may do so by sending the required information to the Nominating and Governance Committee, c/o Corporate Secretary at the address listed above. Any such nomination must comply with the advance notice provisions and provide all of the information required by CST Brands’ Amended and Restated Bylaws. These provisions and required information are summarized under “Stockholder Proposals for 2015 CST Brands Annual Meeting” beginning on page 63 of this Proxy Statement.

Once a person has been identified by the Nominating and Governance Committee as a potential candidate, the Nominating and Governance Committee may collect and review publicly available information regarding the person to assess whether the person should be considered further. If the Nominating and Governance Committee determines that the candidate warrants further consideration, the chairman or another member of the Nominating and Governance Committee would contact the person. Generally, if the person expresses a willingness to be considered and to serve on the Board, the Nominating and Governance Committee requests information from the candidate, reviews the person’s accomplishments and qualifications, including in light of any other candidates that the Nominating and Governance Committee might be considering. Based on its initial evaluation, the

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Nominating and Governance Committee will determine whether to interview a proposed candidate and, if warranted, will recommend that one or more of its members, other members of the Board, or senior management, as appropriate, may conduct one or more interviews with the candidate. In certain instances, the Nominating and Governance Committee members or other Board members may request a background check, may contact one or more references provided by the candidate or may contact other members of the business community or other persons that may have greater first-hand knowledge of the candidate’s accomplishments. After completing this process, the Nominating and Governance Committee ultimately determines which nominees to submit to the full Board for consideration and approval.

Named Executive Officers

Our Named Executive Officers, or NEOs, for 2013 were:

Kimberly S. Bowers. Ms. Bowers has been the Chairman and a member of the Board of CST Brands since November 2012 and has served as its Chief Executive Officer and President since January 1, 2013. Ms. Bowers previously served as Executive Vice President and General Counsel of Valero, a position she held from October 2008 until her election to her position with CST Brands. Ms. Bowers joined Valero in 1997 and served as Managing Counsel and Vice President of Legal Services until January 2003, was promoted to Valero’s Vice President of Legal Services serving in this capacity from January 2003 to April 2006 and then served as Executive Vice President and General Counsel at Valero from April 2006 until November 2012. Ms. Bowers was elected Executive Vice President of Retail Marketing in November 2012. Ms. Bowers served as Lead Attorney for all of Valero’s major acquisitions in the six years prior to joining CST. She also oversaw Valero’s Commercial and Environmental Law departments as well as the Litigation, Labor and Ad Valorem Tax departments. Before joining Valero, Ms. Bowers specialized in mergers and acquisitions with the law firm of Kelly, Hart & Hallman in Fort Worth. She also serves as a Director of WPX Energy, Inc. since December 31, 2011. Ms. Bowers holds a Bachelor of Arts degree in Spanish and International Studies from Miami University (Ohio), Master of Arts degree in International Relations from Baylor University, and her Juris Doctorate from the University of Texas School of Law. Ms. Bowers is a 2009 graduate of the Stanford Executive Program.

Clayton E. Killinger. Mr. Killinger was elected Senior Vice President and Chief Financial Officer of CST Brands effective January 1, 2013. Previously, he served as Senior Vice President and Controller of Valero from July 2007 until January 2013. Before that, he served as Vice President and Controller of Valero from 2003 until July 2007. Mr. Killinger joined Valero in December 2001. Prior to joining Valero, Mr. Killinger, a Certified Public Accountant, was a partner with Arthur Andersen LLP, having joined that firm in 1983.

Anthony P. Bartys. Mr. Bartys was elected Senior Vice President and Chief Operating Officer of CST Brands effective January 1, 2013. Previously, he served as Vice President of U.S. Retail Operations and Marketing of Valero from July 2007 until January 1, 2013. Mr. Bartys has over 27 years of experience in the retail and fuels management field, 21 of those years with Valero and certain of its predecessor companies.

Stephan F. Motz. Mr. Motz was first elected Senior Vice President of CST Brands effective January 1, 2013, and became Senior Vice President and Chief Development Officer on March 11, 2013. He previously

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served as Vice President of U.S. Retail Asset Development and Administration of Valero from October 2003 until January 2013. Mr. Motz has served in various capacities with Valero and certain of its predecessor companies for 30 years.

Charles H. Adams. Mr. Adams was elected Senior Vice President of Marketing of CST Brands effective January 1, 2013, and became Senior Vice President and Chief Marketing Officer effective May 1, 2013. Previously, he served as Vice President of U.S. Retail Merchandising of Valero from January 1, 2001 until January 1, 2013. Mr. Adams served in various capacities with Valero and certain of its predecessor companies for over 25 years.

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SECURITIES HOLDINGS OF PRINCIPAL STOCKHOLDERS,

DIRECTORS, NOMINEES AND OFFICERS

The following tables provide information with respect to the beneficial ownership of our common stock as of April 11, 2014 (1) by beneficial owners of more than 5% of our outstanding common stock based on publicly available information, (2) each of our directors, (3) each executive officer named in the Summary Compensation Table included in this proxy, and (4) all of our executive officers and directors as a group. Except as otherwise noted above or in the footnotes below, each person or entity identified below has sole voting and investment power with respect to such securities. The mailing address for each of the directors and executive officers listed below is One Valero Way, Building D, Suite 200, San Antonio, Texas 78249. The percentage ownership is based on 75,759,786 shares of common stock outstanding at March 30, 2014.

Security Ownership of Certain Beneficial Owners

The following table describes each person, or group of affiliated persons, that qualifies as a beneficial owner of more than 5% of our common stock.

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Security Ownership of Management and Directors

Based upon information received from the persons concerned, each director and nominee for director, each of the executive officers and all directors and officers of CST Brands as a group, owned beneficially as of April 11, 2014, the number and percentage of outstanding shares of common stock of CST Brands indicated in the following table. CST Brands’ Board of Directors has adopted stock ownership guidelines. Please read “Compensation Discussion and Analysis – Stock Ownership Guidelines.” None of the shares listed below have been pledged as security.

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Equity Compensation Plan Information

The following table gives aggregate information regarding grants under all of CST Brands’ equity compensation plans through December 31, 2013.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires CST Brands’ directors and executive officers and persons who own more than 10% of a registered class of CST Brands equity securities to file with the SEC and NYSE initial reports of ownership and reports of changes in ownership of CST Brands common stock. Officers, directors and greater than 10% stockholders are required by SEC regulation to furnish us with copies of all such forms they file. Based solely on a review of the copies of such reports furnished to us and written representations that no other reports were required, CST Brands believes that during 2013, all of its directors and executive officers complied on a timely basis with all applicable filing requirements under Section 16(a) of the Exchange Act.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company has a Code of Business Conduct and Ethics, which requires all directors, officers and employees to promptly bring to the attention of the General Counsel and, in the case of directors, the Chairman of the Nominating and Governance Committee or, in the case of executive officers, the Chairman of the Audit Committee, any transaction or relationship that arises and of which she or he becomes aware that reasonably could be expected to constitute a related-party transaction. For purposes of our Code of Business Conduct and Ethics, a related-party transaction is a transaction in which the Company (including its affiliates) is a participant and in which any director or executive officer (or their immediate family members) has a direct or indirect material interest. Additionally, the Nominating and Governance Committee’s charter provides for an annual review of related-party transactions between each of our directors and the Company (and its affiliates) and to make recommendations to the Board of Directors regarding the continued independence of each Board member.

Related Party Transactions in 2013

On May 1, 2013, Valero completed the separation of Valero’s retail business and CST Brands became an independent public company on that date following the distribution of CST Brands stock by Valero. During portions of 2013, Valero was a related party and transactions with Valero were reviewed as required by our Code of Business Conduct and Ethics. Those transactions are described in more detail in Note 13 of the notes to audited combined financial statements that are included in our Annual Report on Form 10-K filed on March 6, 2014.

These related party agreements include, among others:

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The summaries of the material terms of these agreements are qualified in their entirety by reference to the full text of the applicable agreements, which are filed as exhibits to our Current Report on Form 8-K filed with the SEC on May 1, 2013.

Separation and Distribution Agreement

The Separation and Distribution Agreement governs the terms of the separation of the retail business from Valero’s other businesses. Generally, the Separation and Distribution Agreement includes Valero’s and CST Brands’ agreements relating to the restructuring steps taken to complete the separation, including the assets, equity interests and rights transferred, liabilities assumed, contracts assigned and related matters. The Separation and Distribution Agreement provided for Valero and the Company to transfer specified assets (including the equity interests of certain Valero subsidiaries) and liabilities between CST Brands and its subsidiaries, on the one hand, and Valero’s remaining businesses, on the other hand.

Except as expressly set forth in the Separation and Distribution Agreement or any ancillary agreement, neither Valero nor CST Brands makes any representation or warranty as to the assets, equity interests, business or liabilities transferred or assumed as part of the separation, as to any approvals or notifications required in connection with the transfers, as to the value or freedom from any security interests of any of the assets transferred, as to the absence or presence of any defenses or right of setoff or freedom from counterclaim with respect to any claim or other asset of either Valero or CST Brands or as to the legal sufficiency of any assignment, document or instrument delivered to convey title to any asset or thing of value transferred in connection with the separation. All assets were transferred on an “as is,” “where is” basis and the respective transferees bear the economic and legal risks that any conveyance will prove to be insufficient to vest in the transferee good and marketable title, free and clear of any security interest, and that any necessary consents or governmental approvals are not obtained or that any requirements of laws, agreements, security interests or judgments are not complied with.

The Separation and Distribution Agreement governs the treatment of aspects relating to indemnification, insurance, litigation responsibility, confidentiality, management, intellectual property (including trademarks) and cooperation.

Tax Matters Agreement

The Tax Matters Agreement governs Valero’s and CST Brands’ respective rights, responsibilities and obligations with respect to taxes (including taxes arising in the ordinary course of business and taxes, if any, incurred as a result of any failure of the distribution by Valero and certain related transactions to qualify as tax-free for federal income tax purposes), tax attributes, tax returns, tax contests and certain other tax matters.

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In general, under the Tax Matters Agreement, responsibility for taxes incurred during the periods prior to the distribution, are allocated in the following manner:

In addition, the Tax Matters Agreement imposes certain restrictions on CST Brands and its subsidiaries (including restrictions on share issuances, business combinations, sales of assets and similar transactions) that are designed to preserve the tax-free status of the distribution by Valero and certain related transactions. The Tax Matters Agreement provides special rules allocating tax liabilities if the distribution, together with certain related transactions, is not tax-free. In general, under the Tax Matters Agreement, each party is responsible for any taxes imposed on Valero that arise from the failure of the distribution and certain related transactions to qualify as a tax-free transaction for federal income tax purposes within the meaning of Sections 355 and 368(a)(1)(D) and certain other relevant provisions of the Code to the extent that the failure to qualify is attributable to actions, events or transactions relating to such party’s respective stock, assets or business, or a breach of the relevant representations or covenants made by that party in the Tax Matters Agreement.

The Tax Matters Agreement also sets forth Valero’s and the Company’s obligations as to the filing of tax returns, the administration of tax contests and assistance and cooperation on tax matters.

Employee Matters Agreement

In connection with the separation and the distribution, CST Brands entered into an Employee Matters Agreement between the Company and Valero. The Employee Matters Agreement governs Valero’s and the Company’s compensation and employee benefit obligations with respect to the current and former employees of each company, and generally allocates liabilities and responsibilities relating to employee compensation and benefit plans and programs. The Employee Matters Agreement provides for the treatment of outstanding Valero equity awards. The Employee Matters Agreement also sets forth the general principles relating to employee matters, including with respect to the assignment of employees and the transfer of employees from Valero to CST Brands, the assumption and retention of liabilities and related assets, expense reimbursements, workers’ compensation, leaves of absence, the provision of comparable benefits, employee service credits, the sharing of employee information and the duplication or acceleration of benefits.

Transition Services Agreements

In connection with the separation and the distribution, CST Brands entered into two Transition Services Agreements: one between the Company and Valero and one between the Company’s Canadian subsidiary and Valero. The Transition Services Agreements set forth the terms on which Valero will provide to CST Brands, and the Company will provide to Valero, on a temporary basis, certain services or functions that the companies historically have shared. Transition services may include administrative, payroll, human resources, data

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processing, environmental health and safety, financial audit support, financial transaction support, legal support services, IT and network infrastructure systems and various other support and corporate services. The Transition Services Agreements provides for the provision of specified transition services generally for a period of up to eighteen months, on a cost or a cost-plus basis.

Stockholder’s and Registration Rights Agreement

In connection with the distribution, CST Brands and Valero entered into a Stockholder’s and Registration Rights Agreement pursuant to which the Company agreed that, upon the request of Valero, it would use its best efforts to effect the registration under applicable federal and state securities laws of the shares of CST Brands common stock retained by Valero after the distribution. In addition, Valero granted the Company a proxy to vote the shares of its common stock that Valero retained following the distribution in proportion to the votes cast by CST Brands’ other stockholders. CST Brands completed the registration and Valero sold its remaining shares in November 2013 automatically terminating this proxy, as more fully described in our Annual Report on Form 10-K for the year ended December 31, 2013.

U.S. Fuel Supply Agreements

The U.S. Fuel Supply Agreements provides for a long-term supply of branded motor fuel to the Company’s retail sites. The U.S. Motor fuel will be sold to the Company at various terminal locations throughout the U.S. at market-based prices and we will engage third-party transportation companies to deliver the motor fuel to retail sites in the Company’s U.S. network. The Company has open credit and payment terms of “net 10” days; however, these could change based on Valero’s standard practices and/or the Company’s financial condition. The U.S. Fuel Supply Agreements included provisions covering the addition and removal of retail sites, the processing of bank cards by Valero (for which we will pay processing fees) and the license to us of the right to use Valero’s brands and trademarks. The Company has the ability to purchase unbranded motor fuel under certain circumstances.

Petroleum Product Supply Agreement (Canada)

CST Brands entered into a long-term Petroleum Product Supply Agreement with Valero to purchase branded motor fuel and heating oil for the Company’s Canadian operations. The Petroleum Product Supply Agreement contained provisions relating to, among other things, the term of the agreement, payment terms and use of supplier’s brand names. The motor fuel is sold to the Company at various terminal locations throughout Canada at market-based prices. The Company engaged third-party transportation companies to deliver the motor fuel to its Canadian retail sites and to use a combination of company owned and third-party owned and operated vehicles to supply our heating oil customers.

The Company has open credit and payment terms of “net 10” days; however, these could change based on Valero’s standard practices and/or the Company’s financial condition.

Office Lease Agreement (U.S.)

In connection with the separation and the distribution from Valero, CST Brands entered into an Office Lease Agreement with Valero, pursuant to which it leased approximately 83,000 square feet of office space at the Valero corporate campus in San Antonio, Texas. The term of the lease is five years, but the Company has the right to terminate the lease at any time without penalty upon 180 days’ prior notice to Valero, resulting in a minimum payment obligation of approximately $1 million. Rent and other charges to be paid by the Company under the lease is consistent with the rates charged for comparable office space in the San Antonio area.

Office Sublease Agreement (Canada)

CST Brands also subleased approximately 49,000 square feet of office space from Valero in the building located at 2200 McGill College in Montreal, Québec. The sublease expired on March 31, 2014 and was not renewed.

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Claims Service Agreement

Under the Claims Service Agreement, Valero provides the Company with insurance claims management services to help it manage claims under CST Brands’ workers’ compensation (and Texas non-subscriber), general liability, auto liability and property policies. The services provided by Valero include maintaining claims files, investigating claims made against the Company, hiring independent investigators, medical experts and other third parties to provide claims-related services, recommending settlements and discharging certain obligations the Company may have under applicable workers’ compensation laws. Valero employs licensed claims adjusters who have historically performed these services for the retail business, and Valero charges the Company rates that are consistent with those charged by third parties for similar services. CST Brands the right to terminate the Claims Service Agreement at any time upon 90 days’ prior notice to Valero.

Treatment of Stock-Based Compensation

No stock-based awards of CST Brands were issued in exchange for either vested or non-vested Valero stock-based awards held by its employees prior to the separation. Valero accelerated the vesting of all of its non-vested restricted stock awards held by CST Brands employees on or prior to the Record Date before the separation. Performance shares held by CST Brands employees were forfeited pursuant to the provisions in the performance share agreements between Valero and the affected employees. Valero’s outstanding stock-based awards and long-term incentive plans included adjustments made to the exercise prices and the number of options or shares, as applicable, to reflect the impact of the distribution, as more particularly set forth in the Employee Matters Agreement.

As discussed under “Named Executive Officers” on page 17 the individuals listed below serve as executive officers of CST. As executive officers of CST, each person is considered a “related person” (as defined in Item 404(a) of SEC Regulation S-K). Prior to the distribution, restricted shares of Valero common stock held by the executive officers were subject to accelerated vesting. The number of shares subject to accelerated vesting, the approximate related expense to be recognized by Valero or CST Brands, and the approximate dollar value of the related-persons’ interests in the transaction are as follows:

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PROPOSAL TWO

RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

FIRM

The CST Brands Board of Directors has selected KPMG, LLP to serve as its independent registered public accounting firm for the fiscal year ending December 31, 2014. Although stockholder ratification is not required, the Board of Directors has directed that such appointment be submitted to the stockholders of CST Brands for ratification at the 2014 Annual Meeting. Even if the selection is ratified, the Audit Committee, in its discretion, may select a different independent registered public accounting firm at any time if the Audit Committee believes that such a change would be in the best interests of our Company and its stockholders. If our stockholders do not ratify the selection of KPMG, LLP, the Audit Committee will take that fact into consideration, together with such other factors it deems relevant, in determining its next selection of an independent registered public accounting firm.

KPMG, LLP provided audit services to CST Brands for the year ended December 31, 2013. A representative of KPMG, LLP will be present at the 2014 Annual Meeting, will have an opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.

No report of KPMG, LLP on CST Brands’ financial statements for either of CST Brands’ prior fiscal years contained any adverse opinion or disclaimer of opinion, nor was any such report qualified or modified as to uncertainty, audit scope or accounting principles.

In connection with the audits of CST Brands’ financial statements for prior fiscal years, there were no disagreements with KPMG, LLP on any matters of accounting principles, financial statement disclosure or audit scope and procedures, which, if not resolved to the satisfaction of KPMG, LLP, would have caused the firm to make reference to the matter in its report.

Assuming the presence of a quorum, the affirmative vote of the holders of a majority of the total votes cast is necessary to ratify the appointment of CST Brands’ independent registered public accounting firm. The enclosed proxy card provides a means for stockholders to vote for the ratification of the selection of CST Brands’ independent registered public accounting firm, to vote against it or to abstain from voting with respect to it. If a stockholder executes and returns a proxy, but does not specify how the shares represented by such stockholder’s proxy are to be voted, such shares will be voted FOR the ratification of selection of CST Brands’ independent registered public accounting firm. Abstentions will have the same legal effect as a vote against the proposal.

The Board of Directors recommends a vote “FOR” the ratification of the selection of KPMG, LLP, as CST Brands’ independent registered public accounting firm for the fiscal year ending December 31, 2014.

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The material in this Report of the Audit Committee is not “soliciting material,” is not deemed filed with the SEC, and is not to be incorporated by reference in any of CST Brands’ filings under the Securities Act or the Exchange Act, respectively, whether made before or after the date of this Proxy Statement and irrespective of any general incorporation language therein.

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

The Audit Committee represents and assists the Board in fulfilling its responsibilities for general oversight of the integrity of CST Brands’ financial statements, CST Brands’ compliance with certain legal and regulatory requirements, the independent auditor’s qualifications and independence, the performance of CST Brands’ internal audit function, and risk assessment and risk management. The Audit Committee manages CST Brands’ relationship with its independent auditors (which report directly to the Audit Committee). The Audit Committee has the authority to obtain advice and assistance from outside legal, accounting or other advisors as the Audit Committee deems necessary to carry out its duties and receives appropriate funding, as determined by the Audit Committee, from CST Brands for such advice and assistance.

CST Brands’ management is primarily responsible for CST Brands’ internal control and financial reporting process. CST Brands’ independent auditors, KPMG, LLP, are responsible for performing an independent audit of CST Brands’ consolidated financial statements and internal control over financial reporting, and issuing opinions on the conformity of those audited financial statements with United States generally accepted accounting principles. The Audit Committee monitors CST Brands’ financial reporting process and reports to the Board on its findings.

In this context, the Audit Committee hereby reports as follows:

1. The Audit Committee has reviewed and discussed the audited financial statements with CST Brands’ management.

2. The Audit Committee has discussed with the independent auditors the matters required to be discussed by the Public Company Accounting Oversight Board (“PCAOB”) Auditing Standards No. 16 “Communication with Audit Committees”.

3. The Audit Committee has received the written disclosures and the letter from the independent accountants required by applicable requirements of the PCAOB regarding the independent accountants’ communications with the Audit Committee concerning independence, and has discussed with the independent accountants their independence.

4. Based on the review and discussions referred to in paragraphs (1) through (3) above, the Audit Committee recommended to the Board, and the Board has approved, that the audited financial statements be included in CST Brands’ Annual Report on Form 10-K for the year ended December 31, 2013, which CST Brands filed on March 6, 2014.

This report is submitted by the members of the Audit Committee.

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PRINCIPAL AUDITOR FEES AND SERVICES

Audit Fees. The aggregate fees billed by KPMG LLP for professional services rendered for the audit of CST Brands’ annual financial statements for the years ended December 31, 2013 and 2012 and the reviews of the condensed financial statements included in CST Brands’ quarterly reports on Form 10-Q for the year ended December 31, 2013, and services that are normally provided by the accountant in connection with regulatory filings were $978,178 and $615,000, respectively.

Audit-Related Fees. The aggregate fees billed by KPMG LLP for assurance and related services that were reasonably related to the performance of the audit or review of CST Brands’ financial statements, which are not reported in “audit fees” above, for each of the years ended December 31, 2013 and 2012, were $0.

Tax Fees. The aggregate fees billed by KPMG LLP for professional services rendered for tax compliance, tax advice or tax planning, for each of the years ended December 31, 2013 and 2012, were $0.

All Other Fees. The aggregate fees billed by KPMG LLP for other services, exclusive of the fees disclosed above relating to financial statement audit and audit-related services and tax compliance, advice or planning, for each of the years ended December 31, 2013 and 2012, were $0.

Consideration of Non-audit Services Provided by the Independent Auditors. The Audit Committee has considered whether the services provided for non-audit services are compatible with maintaining KPMG, LLP’s independence, and has concluded that the independence of such firm has been maintained.

AUDIT COMMITTEE PRE-APPROVAL POLICY

The Audit Committee’s policy is to pre-approve all audit, audit-related and non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services, tax services and other services. The Audit Committee approved all of the fees described above. The Audit Committee may also pre-approve particular services on a case-by-case basis. The independent public accountants are required to periodically report to the Audit Committee regarding the extent of services provided by the independent public accountants in accordance with such pre-approval. The Audit Committee may also delegate pre-approval authority to one or more of its members. Such member(s) must report any decisions to the Audit Committee at the next scheduled meeting.

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PROPOSAL THREE

APPROVAL OF THE AMENDED AND RESTATED 2013 OMNIBUS STOCK AND INCENTIVE

PLAN

In connection with, and prior to, CST Brands’ separation from Valero, the Company adopted the 2013 Omnibus Stock Incentive Plan (the “Existing Omnibus Plan”), and Valero, as the sole stockholder at the time, approved the Existing Omnibus Plan. Pursuant to the terms of the Existing Omnibus Plan, the Company may issue various equity securities and cash bonuses to employees and directors selected for participation. Under the Existing Omnibus Plan, the Company may award restricted stock, restricted stock units, stock options, dividend equivalent rights and performance awards.

On April 4, 2014, the Compensation Committee, determined that it is in the best interests of the Company to amend and restate the Existing Omnibus Plan, subject to stockholder approval, to (i) rename the plan the Amended and Restated 2013 Omnibus Stock and Incentive Plan, (ii) reduce the percentage of available shares from 70% to 65% pursuant to which awards may be made under the plan in the form of full-value shares, (iii) to clarify certain provisions relating to performance based awards under the plan, and (iv) to implement certain administrative amendments. Accordingly, this Proposal Three seeks approval of the Amended and Restated 2013 Omnibus Stock and Incentive Plan (the “Amended Omnibus Plan” and when referring to items applicable to both the Existing Omnibus Plan and the Amended Omnibus Plan, the “Omnibus Plan”). A copy of the Amended Omnibus Plan is attached hereto as Annex A to this Proxy Statement.

Approval of the Amended Omnibus Plan satisfies the stockholder approval requirements of Section 162(m) of the Internal Revenue Code of 1986, as amended from time to time (“Code”), which is required at the first annual meeting of the stockholders following the effective date of our separation from and distribution by Valero under the applicable transition rules.

Section 162(m) of the Code limits the amount of compensation paid to certain senior executive officers that public companies may deduct to $1 million for each such senior executive officer in any fiscal year. Certain performance-based compensation is exempt from the deduction limit if it meets the requirements of Section 162(m) of the Code. The Amended Omnibus Plan is intended to permit awards granted thereunder to qualify for exemption from the deduction limit to the extent that the compensation is recognized by the “covered employee” as defined in Section 162(m) of the Code as ordinary income and provided that the awards meet the Section 162(m) of the Code performance-based requirements. One of these requirements under Section 162(m) of the Code is that the material terms of the performance objectives under which the compensation is to be paid must be re-approved by our stockholders not less frequently than once every five years. For purposes of Section 162(m) of the Code, the material terms include the employees eligible to receive compensation, a description of the business criteria on which the performance objective is based, and either the maximum amount of compensation that could be paid to any employee or the formula used to calculate the amount of compensation to be paid to the employee if the performance objective is attained.

In connection with the separation from Valero, the sole stockholder of the Company prior to the separation approved and adopted the Existing Omnibus Plan, including the material terms of the performance objectives contained therein. This Proposal Three does not seek any amendment of the performance objectives contained within the Existing Omnibus Plan. Rather, this Proposal Three is being presented to stockholders to approve certain amendments to the Existing Omnibus Plan and to comply with stockholder approval requirements of Section 162(m) of the Code described above as the transition period available to the Company as the former subsidiary of a public company will expire as of the date of the 2014 Annual Meeting.

The discussion of this proposal is qualified in its entirety by reference to the full text of the Amended Omnibus Plan. The Amended Omnibus Plan will not become effective unless approved by our stockholders. Awards granted prior to the effective date of the Amended Omnibus Plan will remain subject to, and governed by, the terms and conditions of the Existing Omnibus Plan as in effect at the time of the award and the applicable award agreement, unless such award agreement is later amended pursuant to the terms of the Existing Omnibus Plan.

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If stockholders do not approve this Proposal Three and the Amended Omnibus Plan is not approved by our stockholders, future awards under the Existing Omnibus Plan may no longer satisfy the requirements of Section 162(m) of the Code and may no longer be eligible for deductibility by the Company as intended. There is no guarantee that awards intended to qualify for tax deductibility under Section 162(m) of the Code will ultimately be viewed as so qualifying by the Internal Revenue Service.

Description of the Existing Omnibus Plan

The Company adopted the Existing Omnibus Plan in 2013, which permits us to grant stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and cash awards to CST Brands officers, directors and certain other employees. The Existing Omnibus Plan provides a pool of 7,539,724 shares, which is equal to 10% of the shares of CST Brands issued and outstanding on May 2, 2013. Not more than 70% of the available shares under the Existing Omnibus Plan may be in the form of time-based vesting full-value shares or equivalents (including time-lapse Restricted Stock, time-lapse Restricted Stock Units, Stock Units, Performance Shares, Performance Units, Performance Cash and Dividend Equivalents, as described in the Existing Omnibus Plan). As amended, subject to stockholder approval of this Proposal Three, this pool will be reduced from 70% to 65%.

The following is a summary of the material terms of the Existing Omnibus Plan which are the same as the Amended Omnibus Plan unless otherwise noted in this Proposal Three (and when the statement applies to both the Existing Omnibus Plan and the Amended Omnibus Plan in this Proxy Statement we use the term “Omnibus Plan”). The summary does not purport to be complete and is subject to and qualified in its entirety by reference to the complete text of the Existing Omnibus Plan and the Amended Omnibus Plan. To the extent that there is a conflict between this summary and the terms of the plans, the terms of the plans will govern. In the following summary, the term “shares” means CST Brands’ $0.01 par value common stock, and such other securities or property as may become the subject of awards under the Omnibus Plan, and the term “stock unit” means a unit or right whose value is based on the value of a share.

Administration. The Omnibus Plan is administered by CST Brands’ Compensation Committee, composed of directors appointed by CST Brands’ Board of Directors who are non-employee directors, as defined by Rule 16b-3 of the Exchange Act and outside directors, as defined in Section 162(m) of the Code. Per the Omnibus Plan, CST Brands’ Compensation Committee is authorized, subject to the terms of the Omnibus Plan, to determine which participants will receive awards, the times when such awards will be made, the times when such awards will vest, the types of awards, the number of shares to be issued under the awards, the value or amount of the awards, and other terms and conditions of awards. All decisions with respect to the Omnibus Plan are within the discretion of CST Brands’ Compensation Committee. Certain of CST Brands’ Compensation Committee’s duties and authority may be delegated pursuant to the terms of the Omnibus Plan.

Share Counting. Generally, if an award granted under the Omnibus Plan is forfeited or cancelled without the payment of consideration, the shares allocable to the forfeited or cancelled portion of the award are added back to the aggregate available for grant under the Omnibus Plan, and may again be subject to an award granted under the Omnibus Plan. If, however, shares are delivered or tendered to CST Brands for repurchase to satisfy the exercise price of any option award, those shares will not be added back to the aggregate number of shares available for grant under the Omnibus Plan. In addition, if any shares are withheld from issuance to satisfy tax obligations associated with any award, those shares will count against the aggregate number of shares available for future grants under the Omnibus Plan.

Limitations on Awards. The following limitations apply:

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Eligibility. The Omnibus Plan provides for awards to the directors and employees of CST Brands and its subsidiaries. As of the date of this Proxy Statement, nine non-employee directors and approximately 11 thousand employees are eligible to participate in the Omnibus Plan.

Types of Awards. The Omnibus Plan permits grants of: (i) restricted stock and restricted stock units; (ii) stock options (including incentive and non-qualified stock options); (iii) SARs; (iv) performance awards of cash, stock or property; and (v) other stock-based awards. The Amended Omnibus Plan includes a new provision specifically identifying other cash-based awards. Awards may be granted alone, in addition to, or in combination with, any other awards under the Omnibus Plan or any other compensation plan. Awards can be granted for cash or other consideration as determined by CST Brands’ Compensation Committee or as required by applicable law (or for no cash consideration). Awards may provide that upon the grant or exercise thereof, the holder will receive cash, shares or other securities, or property or any combination of these.

Restricted Stock and Restricted Stock Units. Restricted stock is an award of shares subject to a restriction period specified in the award. During the restriction period, the shares may not be transferred and are subject to forfeiture. CST Brands’ Compensation Committee has the discretion to determine potential events of forfeiture, to include early termination of employment, which shall be set forth in the applicable award agreement. The holder is otherwise usually treated as a registered stockholder with the right to receive dividends and vote the shares during the restriction period. Restricted stock units are similar to restricted stock except that the award takes the form of stock units instead of shares. During the restriction period, a holder of restricted stock units may be paid cash (dividend equivalents) that are equal in timing and amount to share dividends but does not have

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voting or other stockholder rights, except that dividends or dividend equivalents shall not be payable or credited in respect of unearned awards subject to performance conditions as noted below. Dividends and dividend equivalents may be accumulated in respect of unearned awards and paid as soon as administratively practicable, but no more than 30 days after such awards are earned and become distributable as determined by CST Brands’ Compensation Committee. The units may be settled in cash or shares.

Stock Options and Stock Appreciation Rights. Stock options give the holder the right to purchase shares at the exercise price specified in the award. SARs give the holder the right to receive an amount in shares or cash equal to the spread between the exercise price specified in the award and the market price of a share at the time of exercise. SARs may be granted alone or with stock options. Stock options and SARs granted under the Omnibus Plan are subject to the terms and conditions determined by CST Brands’ Compensation Committee, except that the exercise price cannot be less than 100% of the fair market value of a share at the time of the grant. CST Brands’ Compensation Committee determines the form in which payment of the exercise price may be made. Stock options may be granted in the form of nonqualified stock options or, provided they meet certain requirements of the Code, ISOs, which are subject to the treatment described below. Stock options and SARs are subject to forfeiture upon a participant’s termination of employment or service, as set forth in the applicable award agreement.

Performance Awards. Performance awards that may be granted under the Omnibus Plan may consist of a right payable in cash, shares, other securities or other property upon the achievement of certain performance goals. Dividends or dividend equivalents may not be paid on unvested performance shares. CST Brands’ Compensation Committee determines the performance goals to be achieved during any performance period, the length of any performance period, the amount of any performance award and the amount of any payment or transfer to be made pursuant to any performance award. Performance awards may be paid in a lump sum, installments, on a deferred basis or otherwise as prescribed by CST Brands’ Compensation Committee. Performance awards are potentially subject to forfeiture upon a participant’s termination of employment or service as determined by CST Brands’ Compensation Committee and set forth in the applicable award agreement.

Performance goals may be particular to a plan participant, may relate to the performance of CST Brands or one of its subsidiaries or divisions, or a combination thereof. Performance goals may be based on achievement of balance sheet or income statement objectives, or any other objectives established by CST Brands’ Compensation Committee. The extent to which such performance goals are met determines the number and/or value of the performance award to the participant. In the case of awards intended to comply with Code Section 162(m) of the Code, performance goals may include the following: increased revenue; net income measures; stock price measures (including growth measures and total stockholder return); market share; earnings per share (actual or targeted growth); earnings before interest, taxes, depreciation and amortization; economic value added; cash flow measures; return measures (including return on equity, return on assets, return on capital, return on equity); operating measures (including operating income, funds from operations, cash from operations, after-tax operating income and sales volumes); expense measures; margins; total stockholder return; proceeds from dispositions; total market value; and corporate values measures (including ethics compliance, environmental and safety).

Unless otherwise directed by the CST Brands’ Compensation Committee at the time of grant, performance awards granted under the Omnibus Plan to “covered employees” will be intended to qualify as “performance-based compensation” (within the meanings given in Section 162(m) of the Code). For any performance award that is intended to comply with Section 162(m) of the Code, specification of the performance goal(s) must be made prior to the beginning of the performance period or not later than the date permitted under Section 162(m) of the Code, and must otherwise satisfy the parameters of Section 162(m) of the Code. CST Brands’ Compensation Committee must certify prior to payment that the previously established performance goal has been met. CST Brands’ Compensation Committee has discretion to decrease but not increase the value of a performance award during the performance period and prior to certification that the established performance goal has been met.

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The Omnibus Plan does not preclude the granting of awards that do not qualify for tax deductibility under Section 162(m) of the Code, nor is there any guarantee that awards intended to qualify for tax deductibility under Section 162(m) of the Code will ultimately be viewed as so qualifying by the Internal Revenue Service.

Stock Compensation and Other Stock-Based Awards. CST Brands’ Compensation Committee may grant other forms of awards based on, payable in, or otherwise related in whole or in part to shares under the Omnibus Plan. Subject to the terms of the Omnibus Plan, CST Brands’ Compensation Committee may determine the terms and conditions of any such other stock-based awards. The number and type of shares to be distributed in lieu of the cash compensation applicable to any award as well as the terms and conditions of any bonus awards are determined by CST Brands’ Compensation Committee.

Other Cash-Based Awards. CST Brands’ Compensation Committee may grant, either alone or in addition to other awards made under the Omnibus Plan, the opportunity to earn a cash bonus award based upon the attainment of one or more performance goals for a designated performance period of one year or less, including annual incentive bash bonus awards. The terms, conditions and payment rules of any such cash award are determined by CST Brands’ Compensation Committee.

Termination of Service. CST Brands’ Compensation Committee has the discretion to determine the impact of any participant’s termination of service upon any unvested awards, to include instances in which the participant terminates service due to retirement, death or disability. Under the Amended Omnibus Plan these provisions will be addressed in the separate award agreements as opposed to within the Omnibus Plan.

Adjustments. CST Brands’ Compensation Committee may make appropriate adjustments in the number of shares available under the Omnibus Plan to reflect any stock split, stock dividend, recapitalization, reorganization, consolidation, merger, combination or exchange of shares, distribution to stockholders, liquidation, dissolution or other similar event.

Change of Control. Upon a change of control as defined in the Existing Omnibus Plan, CST Brands’ Compensation Committee is authorized to cause outstanding awards to be assumed, or new rights substituted therefor, by the surviving entity in the change of control. In addition, for participants whose employment has been terminated in connection with the change of control, CST Brands’ Compensation Committee may accelerate vesting periods, provide for extended exercise periods (for options) or waive other conditions applicable to the outstanding awards so that the terminated participant’s outstanding awards may be vested, exercised, paid or distributed in full on or before a date fixed by CST Brands’ Compensation Committee. Also in connection with a participant’s termination of employment as a result of the change of control, CST Brands’ Compensation Committee may provide for the purchase of outstanding awards from the participant for cash. The Amended Omnibus Plan removes change of control as a defined term under the plan and related references as those matters will be addressed in the applicable award agreements going forward. The intention is that the Compensation Committee will generally have the same discretion as originally contemplated under the Existing Omnibus Plan.

Amendment/Limitations on Amendments. CST Brands’ Compensation Committee, or as applicable, CST Brands’ Board of Directors, may terminate or amend the Omnibus Plan without participant or stockholder approval, except that stockholder approval is required for any amendment that would require stockholder approval under the rules of the NYSE or would be necessary in order for the Omnibus Plan or an award to comply with Section 162(m) of the Code, or as otherwise may be required by applicable rule or regulation. No option or SAR may be canceled and replaced with an option or SAR having a lower exercise price, except in connection with a stock dividend, stock split or similar event as specified in the Omnibus Plan in order to prevent dilution or enlargement of benefits intended under the Omnibus Plan.

Forfeiture Events, Clawback. Under the Amended Omnibus Plan and subject to stockholder approval, awards granted under the Amended Omnibus Plan are subject to clawback, forfeiture or similar requirements to the extent required by applicable law, consistent with CST Brands’ corporate policy regarding the same.

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Federal Income Tax Consequences

The following discussion summarizes certain federal income tax consequences of the issuance and receipt of Omnibus Plan awards under the law as in effect on the date of this Proxy Statement. The rules governing the tax treatment of such awards are complex, so the following discussion of tax consequences is necessarily general in nature and is not complete. In addition, statutory provisions are subject to change, as are their interpretations, and their application may vary in individual circumstances. This summary does not purport to cover all federal employment tax or other federal tax consequences associated with the Plan, nor does it address state, local, or non-U.S. taxes. The Omnibus Plan is not qualified under the provisions of Section 401(a) of the Code, and is not subject to any of the provisions of the Employee Retirement Income Security Act of 1974.

Options, SAR’s, Performance Unit Awards, Restricted Stock Unit Awards and Other Stock-Based Awards. A participant generally is not required to recognize income on the grant of an option, SAR, restricted stock unit award, performance unit award or other stock-based award. Instead, ordinary income generally is required to be recognized on the date the option or SAR is exercised (but see ISO discussion below), or in the case of restricted stock unit awards, performance unit awards or other stock-based awards, upon the issuance of shares and/or the payment of cash pursuant to the terms of the award when the award vests. In general, the amount of ordinary income required to be recognized is: (a) in the case of an option, an amount equal to the excess, if any, of the fair market value of the shares on the exercise date over the exercise price; (b) in the case of a SAR, the fair market value of any shares or cash received upon exercise; and (c) in the case of restricted stock unit awards, performance unit awards or other stock-based awards, the amount of cash and/or the fair market value of any shares received in respect thereof.

ISO’s. When a participant is granted an ISO, or when the participant exercises the ISO, the participant will generally not recognize taxable income (except for purposes of alternative minimum tax). If the participant holds the shares for at least two years from the date of grant, and one year from the date of exercise, then any gain or loss will be treated as long-term capital gain or loss. If, however, the shares are disposed of during this period, the option will be treated as a non-qualified stock option, and the participant will recognize ordinary income equal to the lesser of the fair market value of the shares on the exercise date minus the exercise price or the amount realized on disposition minus the exercise price. Any gain in excess of the ordinary income portion will be taxable as long-term or short-term capital gain.

Cash-Based Awards. Upon payment of a cash-based award, a participant is required to recognize ordinary income in the amount of the award.

Restricted Stock and Performance Share Awards. Unless a participant who receives an award of restricted stock or performance shares makes an election under Section 83(b) of the Code as described below, the participant generally is not required to recognize ordinary income on the award of restricted stock or performance shares. Instead, on the date the shares vest (i.e., become transferable and no longer subject to forfeiture), the participant will be required to recognize ordinary income in an amount equal to the excess, if any, of the fair market value of the shares on such date over the amount, if any, paid for such shares. If a Section 83(b) election has not been made, any dividends received with respect to restricted stock or performance shares that are subject at that time to a risk of forfeiture or restrictions on transfer generally will be treated as compensation that is taxable as ordinary income to the recipient. If a participant makes a Section 83(b) election within 30 days of the date of transfer of the restricted stock or performance shares, the participant will recognize ordinary income on the date the shares are awarded. The amount of ordinary income required to be recognized is an amount equal to the excess, if any, of the fair market value of the shares on the date of award over the amount, if any, paid for such shares. In such case, the participant will not be required to recognize additional ordinary income when the shares vest.

Gain or Loss on Sale or Exchange of Shares. In general, gain or loss from the sale or exchange of shares granted or awarded under the Omnibus Plan will be treated as capital gain or loss, provided that the shares are held as capital assets at the time of the sale or exchange.

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Deductibility by CST. To the extent that a participant recognizes ordinary income in the circumstances described above, CST Brands will be entitled to a corresponding deduction, provided that, among other things, the income meets the test of reasonableness, is an ordinary and necessary business expense, and is not disallowed by the $1 million limitation on certain executive compensation under Section 162(m) of the Code (see “Performance Based Compensation” below).

Performance Based Compensation. In general, under Section 162(m) of the Code, remuneration paid by a public corporation to certain “covered employees” is not deductible to the extent it exceeds $1 million for any year. Taxable payments or benefits under the Omnibus Plan may be subject to this deduction limit. However, under Section 162(m) of the Code, qualifying performance-based compensation, including income from share options, SAR’s and other performance-based awards that are made under stockholder-approved plans and that meet certain other requirements, are generally exempt from the deduction limitation. The Omnibus Plan has been designed so that the CST Brands’ Compensation Committee in its discretion may grant qualifying exempt “performance-based” compensation under the Plan. We believe that awards intended and structured as such by the CST Brands’ Compensation Committee will meet the requirements for “performance-based” compensation under Section 162(m) of the Code, and that the amount of ordinary income to the participant with respect to such awards generally will be allowed as a deduction for federal income tax purposes to CST Brands. However, there is no guarantee that awards will be viewed as so qualifying by the Internal Revenue Service. Other awards that may be subject to the attainment of performance measures but that do not meet the requirements of Section 162(m) of the Code will not qualify as “performance-based” compensation and, in such event, would be subject to deduction restrictions of Section 162(m) of the Code.

Withholding. Awards under the Omnibus Plan may be subject to tax withholding. When an award results in income subject to withholding, we may require the participant to remit the withholding amount to CST Brands or cause our shares to be withheld from issuance or sold in order to satisfy the tax withholding obligations.

Section 409A of the Code Compliance. The Omnibus Plan and each award thereunder is intended to meet the requirements of Section 409A of the Code and will be construed and interpreted in accordance with such intent. Section 409A of the Code generally provides that if a deferred compensation plan or arrangement does not comply with the requirements of Sections 409A of the Code relating to distributions of benefits, prohibitions on acceleration of payment, and timing of deferral elections, then the compensation payable under such plan or arrangement will be included in gross income in the first taxable year of the recipient in which the compensation is not subject to a substantial risk of forfeiture. Failure to comply with Section 409A of the Code may also result in an additional 20% tax to the recipient of the Award and interest on underpayment of tax at a higher than normal rate. It is the intent of the Company that awards under the Omnibus Plan will be structured and administered in a manner that either complies with or is exempt from the requirements of Section 409A of the Code. If any Omnibus Plan provision or award under the Omnibus Plan would result in the imposition of an applicable tax under Section 409A of the Code and related regulations and Treasury pronouncements, that Omnibus Plan provision or award may be reformed to avoid imposition of the applicable tax and no action taken to comply with Section 409A of the Code shall be deemed to adversely affect the participant’s rights to an award.

Description of Proposed Amendments to the Existing Omnibus Plan

The Amended Omnibus Plan incorporates the following changes to the Existing Omnibus Plan: (i) the percentage of available shares pursuant to which awards may be made under the Amended Omnibus Plan in the form of full value shares will be reduced from 70% to 65%, (ii) certain provisions relating to performance based awards will be clarified with respect to the requirements of Section 162(m) of the Code, and (iii) certain administrative changes will be made with respect to the structure and content of the plan that may be alternatively addressed in separate award or change of control agreements, as appropriate. More information regarding these changes is included in the description of our Existing Omnibus Plan included above.

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Calculation of “Overhang” Levels

We understand that maintaining reasonable “overhang” or dilution levels is important to the Company and our stockholders. There are a number of methods of calculating “overhang”. We typically look at “overhang” on a gross basis (i.e., counting each outstanding award and available award on a one-for-one basis) On a gross basis, there were 7,539,724 shares reserved for outstanding equity-based awards and 439,913 shares underlying outstanding equity-based awards issued under the Existing Omnibus Plan as of December 31, 2013 The proposed amendment does not increase the number of shares of our common stock reserved for issuance under the Existing Omnibus Plan and therefore the overhang will not be increased. Currently, there are a total of 7,539,724 shares of our common stock reserved for issuance under the Existing Omnibus Plan and not more than 70% of the available shares under the Existing Omnibus Plan may be in the form of time-based vesting full-value shares or equivalents (including time-lapse Restricted Stock, time-lapse Restricted Stock Units, Stock Units, Performance Shares, Performance Units, Performance Cash and Dividend Equivalents, as described in the Omnibus Plan). As amended, subject to stockholder approval of this Proposal Three, there will be 7,539,724 shares of our common stock reserved for issuance under the Amended Omnibus Plan and the pool of time-based vesting full-value shares or equivalents will be reduced from 70% (or 5,277,806 shares) to 65% (or 4,900,821 shares).

Performance Objectives for Qualified Performance-Based Compensation

Section 162(m) of the Code limits the Company’s ability to deduct compensation paid to its senior executive officers, unless the compensation qualifies as “qualified performance-based compensation,” as defined in Section 162(m) of the Code and the regulations promulgated thereunder. To the extent possible the Company intends to have the Omnibus Plan satisfy the requirements of Section 162(m) of the Code so that the Compensation Committee is able to grant awards satisfying the requirements of “qualified performance-based compensation.” These performance goals may include the following: increased revenue; net income measures; stock price measures (including growth measures and total stockholder return); market share; earnings per share (actual or targeted growth); earnings before interest, taxes, depreciation and amortization; economic value added; cash flow measures; return measures (including return on equity, return on assets, return on capital, return on equity); operating measures (including operating income, funds from operations, cash from operations, after-tax operating income and sales volumes); expense measures; margins; total stockholder return; proceeds from dispositions; total market value; and corporate values measures (including ethics compliance, environmental and safety).

Plan Benefits

The amount and nature of future awards under the Omnibus Plan, if any, are at the discretion of the Compensation Committee. Therefore, the amount and nature of such awards cannot be determined at this time.

The table included under “Executive Compensation – Outstanding Equity Awards at Fiscal Year End 2013” beginning on page 57, shows the stock options, restricted stock, and restricted stock units granted under the Existing Omnibus Plan to the NEOs during 2013. As discussed under “Executive Compensation – Director Compensation for Fiscal Year 2013” beginning on page 60, the current non-employee directors of the Company as a group were granted restricted stock units covering an aggregate of 29,333 shares of Common Stock during 2013.

Please review our “Compensation Discussion and Analysis” for more information about our approach to performance-based compensation.

Assuming the presence of a quorum, the affirmative vote of the holders of a majority of the total votes cast is necessary to approve the Amended Omnibus Plan. The proxy card provides a means for stockholders to vote for the Amended Omnibus Plan, to vote against it or to abstain from voting with respect to it. If a stockholder executes and returns a proxy, but does not specify how the shares represented by such stockholder’s proxy are to be voted, such shares will be voted FOR the Amended Omnibus Plan. Abstentions will have the same legal effect as a vote against the proposal.

The Board of Directors recommends a vote “FOR” approval of the Amended Omnibus Plan.

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PROPOSAL FOUR

ADVISORY VOTE ON EXECUTIVE COMPENSATION

CST Brands asks that you indicate your support for the Company’s executive compensation policies and practices as described in our Compensation Discussion and Analysis, accompanying tables and related narrative contained in this Proxy Statement beginning on page 38. Your vote is advisory and will not be binding on the Board of Directors; however, the Board of Directors will review the voting results and take them into consideration when making future decisions regarding executive compensation.

The Compensation Committee is responsible for executive compensation and works to structure a compensation plan that reflects CST Brands’ underlying compensation philosophy of aligning the interests of our executive officers with those of our stockholders. Key elements of this philosophy are:

The Board of Directors recommends a vote “FOR” the following resolution:

RESOLVED: That the stockholders approve, on an advisory basis, the compensation of CST Brands’ executive officers named in the Summary Compensation Table, as disclosed in this Proxy Statement pursuant to the executive compensation disclosure rules of the SEC, which disclosure includes the Compensation Discussion and Analysis, the compensation tables and other executive compensation disclosures and related material set forth in this Proxy Statement.

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COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis describes the material elements of the compensation of our Named Executive Officers (NEOs) and describes the objectives and principles underlying the Company’s executive compensation programs, the compensation decisions we have recently made under those programs, and the factors we considered in making those decisions.

During 2013, the Company successfully completed a significant transition from being a subsidiary of Valero into an independent company. The Company has emerged as one of the largest independent retailer of transportation fuels and convenience merchandise in North America.

As a newly independent company, the Compensation Committee developed several key elements of our executive compensation programs. The Company has adopted programs to tailor its pay practices to operational objectives, and to ensure retention of key employees in the Company’s new retail industry environment. In addition, some elements of the Company’s compensation programs are designed to reinforce a culture of teamwork between each of the Company’s Service Center employees and those serving customers in the Company’s retail locations so that they can “Delight More Customers Every Day™”. The 2013 executive compensation structure represents a year of transition for the executive officers of the Company. The Committee intends to continue to review the structure to achieve an optimal alignment with market conditions and industry prevalence.

How We Performed in 2013

As an independent retailer, the Company focuses on the following key priorities that we believe will drive value for our stockholders:

The Company’s compensation programs are designed to reward executives for performance consistent with the Company’s priorities, to attract and retain high-quality talent, and to align compensation with the long-term interests of our stockholders. As a result, the executive compensation programs closely tie pay to performance. In 2013, the Company delivered strong results, including:

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How Our Performance Affected Our Pay

There are three separate elements to the compensation program for our NEOs: Base Salaries, Short-Term Incentives, and Long-Term Incentives.

Base Salaries. Base salaries are generally targeted at the median levels for our peer group determined based on our benchmarking process (see “Peers and Benchmarking”) and represent a smaller percentage of total pay for top executives than for other employees.

Short-Term Incentive Program (STIP) Bonus. The bonus payout under our Short-Term Incentive Program is calculated using the following formula for all executive officers, subject to Compensation Committee approval:

Based on the performance of the Company against approved metrics, the Company paid out Short-Term Incentive Program Bonuses as follows:

Company Performance – Based on the Company’s above-target operational performance in 2013, 137.8% of target for each of our NEOs (see the “Short-Term Incentive Program” section on page 44 for additional detail).

Individual Performance – adjustments between 0% and 12.5% for each of our NEOs. The Compensation Committee took into account relevant market and peer data information for each of the NEO’s positions and internal pay parity.

Long-Term Incentive – Stock Options and Restricted Stock. The Company granted stock options and restricted stock to key employees, including the NEOs, to promote an immediate long-term focus on stockholder value and serve as a retention tool. The grants were made on May 6, 2013, shortly after the common stock began trading on the NYSE.

Stockholder Engagement

Throughout 2013, the Company actively engaged in dialogue with a significant number of large stockholders to better understand stockholder views of the Company. The Company is committed to continue to engage in regular dialogue with its investors to obtain valuable feedback related to our business, including executive compensation and corporate governance practices. We share stockholder feedback with our Board of Directors.

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Philosophy and Goals of Our Executive Compensation Program

Our Philosophy

We believe that our ability to “Delight More Customers Every Day™” and to provide sustainable stockholder value is driven by teamwork and superior individual performance. We believe that a company must offer competitive compensation to attract and retain experienced, talented, and motivated employees. Moreover, we believe employees in leadership roles within the organization are motivated to perform at their highest levels when long-term incentive compensation, including performance-based pay, is a significant portion of their compensation.

Our Goals

Our goals are to attract, retain, and motivate high-quality employees and to maintain high standards of principled leadership so that we can meet our operational and financial objectives, and provide sustainable value growth for our stockholders, now and in the future.

Internal Pay Equity

Taken as a whole, our compensation program is designed so that the individual target level rises as duties and responsibilities increase for the individual, with the portion of performance-based compensation rising as a percentage of total targeted compensation. We believe our compensation structure provides a framework for an equitable compensation ratio between executives, with higher targets for positions having greater duties and responsibilities. One result of this structure is that an executive’s actual total compensation as a multiple of the total compensation of his or her subordinates is designed to increase in periods of above-target performance and decrease in times of below-target performance. In addition, the Committee also reviews the compensation of the executive officers periodically to ensure the equitable compensation of officers with similar levels of responsibilities.

Our Compensation and Governance Practices

To achieve our goals, we implement our philosophy through the following guiding principles:

Below is a summary of compensation practices we have adopted, and a list of problematic pay practices that we avoid.

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To manage risk and be responsive to concerns that our stockholders may have we have instituted policies that prohibit problematic practices such as the following:

WHAT WE DON’T DO
		No Hedging, Short Sales, or Derivative Transactions in Company Stock: Company policies prohibit our directors and executives from hedging or trading in derivatives of the Company’s stock.
		Anti-Pledging Policy: Company policies prohibit our directors and executives from pledging Company securities as collateral or security for a debt without advance approval from the Compensation Committee and the Chief Executive Officer.
		No Employment Agreements for Our NEOs: All compensation for these officers is established by the Committee on an annual basis.
		No Stock Options Granted with an Exercise Price Less than Fair Market Value: All stock options are granted with an exercise price at Fair Market Value defined as the average of high and the low price on the date of the grant.
		No Inclusion of the Value of Bonus or Equity Awards in Company Sponsored Retirement Plan: Only base salary is included in any Company match in our 401(k) plan.
		No Position-Specific Benefits: All the Company’s benefits for executive officers are based on the same eligibility criteria as other employees.
		No Re-Pricing of Underwater Options Under Plan: Our Option Plan prohibits the re-pricing of stock options or other downward adjustments in the option price of previously granted stock options except in connection with corporate transactions.

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Risk Assessment

The Company and the Compensation Committee have conducted a risk assessment of the Company’s compensation policies and practices in response to public and regulatory concerns about the link between incentive compensation and excessive risk taking by companies. The Company’s compensation policies and practices were evaluated to ensure that they do not foster risk taking above the acceptable level of risk associated with the Company’s business. The Company and the Compensation Committee concluded that our compensation program does not motivate imprudent risk taking. In this regard, the Compensation Committee believes that:

Elements of Executive Compensation

The Company and the Compensation Committee have three core elements of total direct compensation: Base Salary, Short-Term Incentives and Long-Term Incentives.

The Compensation Committee is implementing a multi-year strategy to align the total direct compensation with competitive peer levels. For 2013, the focus was to bring base salary and annual incentive compensation in better alignment with our established peer group. In 2014, the Compensation Committee is focusing on refining the weighting of the element mix, among base pay, short term and long-term incentives, to be more in line with the established peer group. In 2015 and beyond, the Compensation Committee intends to focus on monitoring and adjusting compensation based on the Company’s financial position and results and market practices including those of our peer group.

The Compensation Committee generally targets direct compensation (base salaries, annual cash short-term incentive bonuses and long-term incentives) at the 50th percentile of the Company’s peer group because the Compensation Committee believes it is a fair and competitive starting point to attract and retain critical executive talent. The Compensation Committee reviews each executive’s total compensation for alignment with the Company’s peer group and our compensation philosophy. However, the Compensation Committee does not determine the level of total compensation based exclusively on comparative analysis against the Company’s peer group. It considers other factors, which may include internal pay equity and consistency, the executive’s job responsibilities, management experience, individual contributions, number of years in his or her position, and recent compensation adjustments, as well as other relevant considerations (with no particular weighting assigned to any of these factors). The Compensation Committee’s emphasis on variable or “at risk” components of incentive pay results in actual compensation ranging above or below the median based on the achievement of the objectives established in the Company’s short-term and long-term incentive programs, and changes in the value of the Company’s stock. Retirement and health and welfare benefits provided to our NEOs are designed to be consistent in value and, to a lesser degree, aligned with benefits offered by companies with whom we compete for talent. While the Compensation Committee believes that each compensation component should be considered separately and that payments or awards derived from one component should not negate or reduce payments or awards derived from other components, the components are considered within the context of each executive’s total compensation.

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The Compensation Committee has not adopted any formal or informal policies or guidelines for allocating compensation between long-term and annual compensation (base salary and annual cash short-term incentive bonuses), between cash and non-cash compensation, or among different forms of non-cash compensation. However, our strategy includes ongoing evaluation and adaptation, as necessary, of our compensation programs to ensure continued alignment between long-term Company performance and pay.

2013 Target Compensation

The Compensation Committee established the targets for 2013 compensation for our NEOs under our three primary compensation programs. As discussed under “Elements of Executive Compensation” with the exception of salary, the target payment amounts shown below are performance-based and, as a result, actual amounts received under such programs, if any, may differ from these targets.

As illustrated in the accompanying chart, in 2013, 80% of the Chief Executive Officer’s total direct compensation target was performance-based (66% for other executives), of which 53% was in the form of long-term equity compensation (40% for other NEOs).

2013 Pay Mix Target

One-Time CEO and CFO Grant

Not reflected in the table above, providing the targets for 2013 compensation for our NEOs and the discussion of pay mix, are the one time grants made to our CEO and CFO in connection with their joining CST Brands. Immediately following the effective date of the Company’s separation from Valero, our CEO received a restricted stock grant of 50,400 shares and our CFO received a restricted stock grant of 28,000 shares. These shares vest in one third increments beginning on the first anniversary of the effective date of the grant. See “Executive Compensation - Grants of Plan-Based Awards for Fiscal Year 2013” starting on page 56. These

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grant values represented an effort to compensate these officers for the performance shares that they forfeited as a result of leaving their employment with Valero in connection with the spin-off. These grants caused the target compensation mix for the CEO and CFO for 2013 to differ from the mix of equity vehicles described under “Long-Term Incentives” below of approximately 50% of the value in stock options and 50% in restricted stock in 2013.

2014 Target Compensation

As illustrated in the accompanying charts, in 2014, the Company intends to continue to tighten the alignment of pay with median practices among the Company’s peers, and shift a greater proportion of compensation toward long-term incentives.

2014 Pay Mix Target

Base Salary

Base salary is an important component of the compensation for all Company employees, helping to maintain our ability to recruit and retain exceptional talent. Base salaries are generally targeted at median market levels, and represent a smaller percentage of total pay for top executives than for other employees. Base salaries are reviewed and established annually, upon promotion, or following a change in job responsibilities, based on market data, internal pay equity and each executive’s level of responsibility, experience, expertise and performance. Overall, our NEO total target pay being 75% of the peer median (i.e., 25% below the median) with base salaries falling at 77% of the peer median levels, the Short-Term Incentive Bonus Target just below the peer median level, and long-term incentive grant values at 90% of the peer median levels.

Short-Term Incentive Program

To establish the Short-Term Incentive Program bonus targets, Bonus Target, for the Company’s NEOs, the Compensation Committee first sets quantitative financial performance goals, as well as qualitative goals and objectives. The Committee then considers the position of the NEO, which is used to determine a targeted percentage of base salary that may be awarded as incentive bonus and finally a qualitative evaluation of the individual’s performance based on such factors as role and responsibility, desire for internal parity of pay opportunities, assessment of pay opportunities within the peer group identified on page 50 in the convenience retail, quick-serve restaurant, and small box retail industries, and the CEO’s qualitative assessment of CST Brands’ performance and the individual’s performance.

In 2013, achieving a minimum threshold of the Company’s revised budget for operating income was a top business priority. Under the 2013 bonus program, the bonus amount for operating income would be paid if

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operating income (as reported in our audited financial statements) of $105M or more was achieved during the performance period. If the goal is exceeded, the bonus payable is not increased. The maximum bonus pool is allocated, based on the following percentages, to establish the maximum potential bonus payouts for each NEO:

The Compensation Committee has the discretion to adjust the amounts actually paid downward from the maximum potential bonus payout, based upon the Company’s performance and the Committee’s assessment of each NEO’s performance. This assessment includes such factors as role and responsibility, desire for internal parity of pay opportunities, participation in Corner Store Time, assessment of pay opportunities with market peers and the CEO’s qualitative assessment of CST Brands’ performance and the individual’s performance.

Financial Performance Goals. The Financial Performance Goals considered for bonuses under the Short-Term Incentive Program during 2013 were:

The Compensation Committee typically establishes minimum, target, and maximum levels for these measures in the first quarter of the performance year. Due to the timing of the spin-off from Valero on May 1, 2013, the approval for this measure occurred on June 3, 2013. We believe that the Bonus Target should consider both the profitability of the organization as well as how the Company is optimizing cash flow from its asset base compared to our peers in the convenience retail space. We chose to utilize this different peer group for incentive compensation than that set forth under the heading “Peers and Benchmarking” below because these companies are the most comparable companies for which we have data. We believe that these measures appropriately reflect the Company’s business planning process and Company philosophy regarding financial performance measurement.

The CFRONA peer group for 2013 is:

The CFRONA peer group was utilized in determining ranking of CST Brands’ financial performance relative to our peers.

Connecting the Company through the Corner Store Time Program. In 2013, the Company implemented the Corner Store Time program, which is aimed at connecting team members in the CST Service Centers and other above-store support positions to the Company’s core business of operating convenience retail. All team members are required to complete a minimum number of 6-hour shifts (five for executive officers and 2 for all other team members). As an incentive, 10% of the bonus potential for each employee is tied to the completion of their Corner Store Time and 10% of the bonus potential is tied to 75% of all required employees completing the required shifts.

The Corner Store Time program not only lets our above-store employees gain a better understanding of how our stores operate, but it also allows for an open channel of communication to gather the thoughts and ideas of our store employees for innovative ideas that can then be implemented throughout our retail network.

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Achievement of Performance Goals for 2013

The following table details the performance targets and final results of CST Brands’ 2013 achievement for each of the sub-components of the Bonus Target’s Financial Performance and Corner Store Time Goals.

Target Bonus Performance Goals

Supplemental Disclosure Regarding Non-GAAP Financial Information

Cash Flow Return on Net Assets (CFRONA) is computed as follows:

Adjusted EBITDA is a non-GAAP financial measure. Adjusted EBITDA should not be considered as an alternative to net earnings, earnings before income taxes, net cash from operating activities or any other measure of financial performance presented in accordance with accounting principles generally accepted in the United States.

See “Non-GAAP measures” within Liquidity and Capital Resources in our Annual Report on Form 10-K for the year ended December 31, 2013 for our definition of Adjusted EBITDA and our reconciliation of net income to Adjusted EBITDA.

As a result of CST Brands’ 2013 actual operating income performance versus the revised budget, NEOs were eligible to receive the maximum bonus pool of $10.5 million. The final 2013 bonus amounts paid to our NEOs were determined by the Compensation Committee so that the amounts paid fell below the maximum amounts established under the bonus pool. Once actual performance was measured against the financial, operational, and strategic goals described above, it was determined that actual performance was 137.8% of the previously adopted 2013 Short-Term Target Bonus Value for each NEO. The Compensation Committee then made adjustments to such amount to be paid to each NEO based on the desire for internal pay parity, assessment of pay opportunities with market peers, and, to a lesser degree, the CEOs qualitative assessment of CST Brands’

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performance and the individual’s performance. Accordingly, the final bonus amounts represent the application of the Compensation Committee’s downward discretion from the maximum bonus pool available to a lower amount based on the measurement of actual performance versus the performance targets, and other factors detailed above. Following this exercise of downward discretion, the 2013 Short-Term Incentive (STI) amounts paid to our CEO was $1,686,672, to our CFO was $709,000, to our Chief Operating Officer was $440,000, and to each of our Chief Development Officer and our Chief Marketing Officer was $357,000.

Long-Term Incentives

The long-term incentive program is designed to promote share ownership among the Company’s senior management, including our NEOs, further aligning their interests with those of stockholders, thereby promoting stockholder value creation. We believe that our NEOs should have a considerable portion of their compensation tied to the Company’s stock price performance. When the Compensation Committee grants stock options or other equity grants to the Company’s NEOs, the Compensation Committee uses the mean of the stock’s high and low prices on the date of grant (or the preceding business day, if the markets are closed on the date of grant) to determine the exercise price of the options or the value of other equity. Long-term incentive grants are approved during the Compensation Committee’s March meeting (the date of which is determined at least a year in advance) and the date of the grant is the first open trading day after the quarterly “Blackout Period,” which is defined as beginning fifteen (15) days prior to the end of each fiscal quarter and ending on the second (2nd) day following the date of the public release of the Company’s earnings results for that quarter. The Company does not time stock option or restricted stock grants in coordination with the release of material non-public information.

In the case of new hires, grants are typically granted on the first open trading day after the quarterly “Blackout Period” but the Committee reserves the right to use the date of commencement of employment or the date of Committee approval, whichever is later.

Value of Long-Term Equity Compensation Awarded. For each NEO, the Compensation Committee establishes a target as a percentage of base salary for long-term incentive awards based upon a study of the pay practices for our peer group identified on page 50. We utilize the mean of the highest and lowest prices per share on the NYSE on the date of grant in establishing the actual award sizes, the Compensation Committee makes primary reference to median peer company grant levels and then makes individualized determinations of award sizes based on additional factors such as each executive’s experience and contribution to Company success, and internal pay equity. In addition, an executive’s target award may be adjusted based upon the Compensation Committee’s determination of the executive’s individual performance, which (for executives other than the Chief Executive Officer) takes into consideration the recommendation of the Chief Executive Officer.

For 2013, the initial long-term incentive grant values, not including the special one-time grants described above under the heading “Elements of Executive Compensation - One-Time CEO and CFO Grant”, were approximately 50% of the grant values received by similarly situated officers of the Company’s peer group identified on page 50. The Compensation Committee established these targets as an interim step from the pre-spin equity compensation received from Valero to the median grant values for CST Brands’ peers.

Mix of Equity Vehicles. The Company used a mix of stock options and restricted stock when making annual long-term equity awards in 2013. For 2014, the Company has used a mix of stock options and restricted stock units when making annual long-term equity awards. Once the value of the long-term equity compensation award was determined, the Compensation Committee granted approximately 50% of this value in stock options and 50% in restricted stock in 2013 and restricted stock units for 2014. Due to differences in calculating grant date fair value of option awards for accounting purposes, the amounts reported in the Summary Compensation Table reflect a somewhat different proportion of stock options and restricted shares. Additionally, the grant values differ as a result of the one-time grants made as discussed under “Elements of Executive Compensation - One-Time CEO and CFO Grant”.

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The Compensation Committee believes this mix of equity vehicles strikes the appropriate balance between rewarding increases in the market value of the Company’s Common Stock (stock options) and use as a retention tool for the new Company. Option grants generally have a term of ten years and vest over three years. Restricted stock grants and restricted stock unit grants vest over three years except for the grants described above under the heading “Elements of Executive Compensation - One-Time CEO and CFO Grant.”

Stock Options. The Compensation Committee believes that stock options are performance-based because their value is solely tied to the Company’s stock price, which directly correlates to stockholders’ interests. We grant stock options for several reasons, including:

While we do not believe that stock options cause a focus on short-term stock price movements or lead to excessive risk-taking, the Company’s compensation policies include risk mitigation features. We have stringent stock retention requirements to ensure that a significant portion of executive officers’ net worth is in Company stock, resulting in a tie to long-term sustainable performance. Further, we do not, and have not, backdated or re-priced options.

Restricted Stock. As a newly formed public company, restricted stock is used as a means to create an “owner” focus for our NEOs. In addition, the Compensation Committee believes that restricted shares foster stockholder value alignment and pay-for-performance. We believe that our executives, as stockholders, will focus on driving top-tier performance in our industry. In addition, restricted stock is used as a retention tool to ensure continuity and engagement of leadership.

Additional Compensation Elements

Excess Savings Plan. The Company has established the Excess Savings Plan, which is a non-qualified deferred compensation program that provides benefits to Company employees whose annual additions to the Company’s qualified 401(k) plan are subject to the regulatory limitations. All balances under the Excess Savings Plan are maintained on the books of CST Brands and earnings are credited to a participant’s accumulated savings account under the plan in an amount equal to an interest rate of prime plus 1%. As with our “Safe Harbor” 401(k) plan, participants are 100% vested at all times in any Company contributions credited to their Excess Savings Plan accounts.

Other Benefits. In general, the Company’s benefits are designed to provide a safety net of protection against the financial catastrophes that can result from illness, disability or death, and to provide a defined contribution retirement program to assist with the retirement security needs of our employees. NEOs participate in the same benefit plans as the broader employee population of the Company.

Roles in Making Compensation Decisions

The Compensation Committee exercised its authority in setting the above-described compensation strategy for our NEOs. In doing so, the Compensation Committee relies on our independent compensation consultant who provides peer and benchmarking data with respect to compensation and the development of performance measures for our compensation program. Our human resources department supports the Compensation Committee in its exercise of authority.

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Compensation Committee

The Compensation Committee reviews and discusses the Board’s evaluation of the Chief Executive Officer and makes preliminary determinations about her base salary, annual incentive and long-term equity compensation. The Compensation Committee then discusses the compensation recommendations with the full Board and the Board approves final compensation decisions regarding the CEO’s pay after this discussion. Neither our CEO, nor any other executive officer present recommendations or determine the compensation of the Chief Executive Officer.

For other NEOs, the Chief Executive Officer considers performance and makes individual recommendations to the Compensation Committee on base salary, annual incentive and long-term equity compensation. The Compensation Committee reviews, discusses, modifies and approves, as appropriate, these compensation recommendations.

Compensation Consultants

The Compensation Committee has the authority to retain and terminate any compensation consultant to be used in the evaluation of the compensation of the CEO and the other NEOs, and has sole authority to approve such consultant’s fees and other retention terms. The committee may also retain, terminate and obtain advice and assistance from external legal, accounting or other advisors and consultants. The Committee retained Exequity LLP (“Exequity”) to serve as its independent executive compensation consultant in 2013 and paid Exequity professional fees for 2013 of $ 161,280.

Since CST Brands’ first day of operations as an independent company on May 1, 2013, Exequity’s executive and director compensation consulting services included:

On March 3, 2014, the Compensation Committee considered the following six factors with respect to Exequity: (i) the provision of other services to the Company by Exequity; (ii) the amount of fees received from the Company by Exequity, as a percentage of the total revenue of Exequity; (iii) the policies and procedures of Exequity that are designed to prevent conflicts of interest; (iv) any business or personal relationship of Exequity consultant with a member of the Compensation Committee; (v) any stock of the Company owned by the Exequity consultant; and (vi) any business or personal relationship of the Exequity consultant or Exequity with an executive officer of the Company. After considering the foregoing factors, the Compensation Committee determined that the work of Exequity with the Compensation Committee for fiscal 2013 and 2014 has not raised any conflicts of interest affecting Exequity’s independence.

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Management

The Company’s human resources department supports the Compensation Committee in the execution of its responsibilities. The Company’s Senior Vice President, Human Resources supervises the development of the materials for each Compensation Committee meeting, including market data, individual and Company performance metrics and compensation recommendations for consideration by the Compensation Committee.

As noted above, the CEO considers performance and market data and makes individual recommendations to the Compensation Committee on base salary, annual incentive and long-term equity compensation with respect to all NEOs other than herself. The Compensation Committee reviews, discusses, modifies and approves, as appropriate, these compensation recommendations. No member of the management team, including the CEO, has a role in determining his or her own compensation.

Peers and Benchmarking

In anticipation of the distribution, Valero, as sole stockholder of CST Brands, engaged in a benchmarking process to establish initial base salaries, initial long-term incentive grants, annual incentive bonus targets and annual long-term incentive targets for our NEOs. Cash and equity as well as short-term and long-term allocations of compensation were considered in this benchmarking process. The benchmarked compensation components take into account new positions with increased responsibilities for our NEOs within the CST Brands organization and market compensation levels of our peer companies.

Exequity served as the independent executive compensation consultant for this benchmarking process and continues to advise CST Brands’ Compensation Committee. The following companies were used as a peer group for purposes of targeting compensation for our NEOs:

For performance measures, we used a different peer group as described above under “Short-Term Incentive Program - Financial Performance Goals.”

Exequity provided the Compensation Committee with a statistical analysis of compensation data for the companies listed above to consider in its determination of individual NEO pay levels. The companies in the peer group are companies in the convenience retail, quick-serve restaurant, and retail industry with similar operations, revenues, assets and market capitalization and with whom we believe we compete for executive talent. Based on a comparative review of annual revenues, assets and market capitalization, CST Brands’ business size falls within a reasonable range of the median of the peer group. Consistent with the desired transition from pre-spin-off NEO pay levels that generally fell well below median peer levels, the 2013 pay adjustments resulted in total NEO targeted pay that fell at approximately 75% of the peer median (i.e., 25% below the median) included in the statistical analysis, with base salaries falling at 77% of the peer median levels, the Short-Term Incentive Bonus Target just below the peer median level, and long-term incentive grant values at 90% of the peer median levels.

Once an overall target compensation level is established, the Compensation Committee considers the weighting of each of our primary compensation programs (Base Salary, Short-Term Incentive Bonus, and Long-Term Incentive Plan) within the total targeted compensation.

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Developing Performance Measures

We believe our performance metrics assess the performance of the Company relative to its post-spin strategy as an independent retail organization, focusing on the following key priorities that we believe will drive value for our stockholders:

Consistent with this focus, the Compensation Committee has approved a balance of metrics, some of which measure performance relative to our peer group and some of which measure absolute metrics that are directly tied to the post-spin strategy. We have selected multiple metrics, as previously described, because we believe no single metric is sufficient to capture the performance we are seeking to drive, and any metric in isolation is unlikely to promote the well-rounded executive performance necessary to enable us to achieve long-term success. The Compensation Committee reassesses performance metrics periodically.

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Additional Policies

Stock Ownership Guidelines

We place a premium on aligning the interests of executives with those of our stockholders. Our Stock Ownership Guidelines require executives to own stock and/or have an interest in restricted stock or similar full valued equity. The guidelines establish the following ownership levels:

Shares counted toward the guidelines include: (1) shares of stock owned individually or jointly, or in trusts controlled by employee; (2) restricted stock and restricted stock units; (3) shares owned in a company sponsored retirement plan. Shares excluded include unexercised stock options and unvested or unpaid performance shares.

If a director or officer has not reached his or her stock ownership guideline, the director or officer will be required to hold 50% of the shares of Common Stock received upon lapse of the restrictions upon restricted stock, upon the vesting of performance shares, and upon exercise of stock options (net of any shares utilized to pay for the exercise price of the option and tax withholding).

As of March 31, 2014, all of the directors, other than Stephen A. Smith who joined the Board of Directors in March 2014, have met the applicable stock ownership multiple guidelines. However, Mr. Killinger is the only officer who has met the applicable stock ownership multiple guidelines.

Anti-Hedging and Anti-Pledging

The Company has a policy that prohibits our directors and executives from hedging or trading in derivatives of the Company’s stock. This policy, together with the Stock Ownership Guidelines discussed above, helps to assure that our NEOs remain subject to the risks, as well as the rewards, of stock ownership.

In addition, CST Brands’ directors and officers may not purchase, sell or write calls, puts or other options or derivative instruments on shares of CST Brands’ common stock, and CST Brands’ directors and officers are prohibited from pledging shares of CST Brands’ common stock as collateral or security for indebtedness. Compliance with the guidelines is monitored by CST Brands’ Compensation Committee. The full text of CST Brands’ stock ownership and retention guidelines is included in CST Brands’ Corporate Governance Guidelines (as Article IX), available on CST Brands’ website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section.

Clawback Policy

In September 2013, the Compensation Committee approved a clawback policy providing that the Company shall recoup any incentive compensation (cash or equity) paid or payable to any executive by the Company to the extent such recoupment is required or contemplated by the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Sarbanes-Oxley Act, or any other applicable law or listing standards, which allows the Board to recoup compensation paid in the event of certain business circumstances, including a financial restatement. This policy operates in addition to provisions already contained in our Omnibus Plan pursuant to which unvested awards shall automatically lapse and be forfeited, and vested but unexercised awards shall automatically lapse and be forfeited if the recipient is terminated for cause, including acts of misconduct, embezzlement, fraud, theft or disclosure of confidential information or is convicted of a felony involving moral turpitude. Once final rules are released regarding clawback requirements under the Dodd-Frank Act, we intend to review our policies and plans and, if necessary, amend them to comply with the new mandates.

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Statutory and Regulatory Considerations

In designing our compensation programs, we take into account the various tax, accounting and disclosure rules associated with various forms of compensation. The Compensation Committee also reviews and considers the deductibility of executive compensation under section 162(m) of the Code and designs its deferred compensation programs with the intent that they comply with section 409A of the Code. The Compensation Committee generally seeks to preserve tax deductions for executive compensation. Nonetheless, the Compensation Committee has awarded and may award compensation that is not fully tax deductible when it believes such grants are in the best interests of our stockholders.

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REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS

The Compensation Committee of CST Brands has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

This report is submitted by the members of the Compensation Committee.

Donna M. Boles, Chair

Denise Incandela

Alan Schoenbaum

The Compensation Committee Report is not “soliciting material,” is not deemed filed with the SEC, and is not to be incorporated by reference into any of CST Brands’ filings under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, respectively, whether made before or after the date of this Proxy Statement and irrespective of any general incorporation language therein.

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EXECUTIVE COMPENSATION

The following tables and accompanying narrative disclosures provide information concerning total compensation paid to the Company’s NEOs since the Company’s May 1, 2013 spin date through December 31, 2013.

Summary Compensation Table For Fiscal Year 2013

The following table summarizes the compensation for the Company’s NEOs since our inception on May 1, 2013.

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Grants of Plan-Based Awards for Fiscal Year 2013

The following table describes plan-based awards for the Company’s NEOs in 2013.

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Outstanding Equity Awards at Fiscal Year End 2013

The following table provides information concerning outstanding equity awards at December 31, 2013 for the Company’s NEOs.

Option Exercises and Stock Vested

None of the Company’s NEOs exercised any options and no stock vested in 2013.

Pension Benefits

CST Brands does not sponsor any pension benefit plans and none of the Company’s NEOs contribute to such a plan.

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Non-Qualified Deferred Compensation for Fiscal Year 2013

The Company has established the Excess Savings Plan, which is a non-qualified deferred compensation program to provide benefits to Company employees whose annual additions to our qualified 401(k) plan are subject to the regulatory limitations. The plan is described in greater detail starting on page 48. The plan made its first contribution in the first quarter of 2014 that was earned in 2013. The plan will make an annual contribution in the first quarter of each year. The following table shows the activity earned through December 31, 2013:

Employment Agreements and Potential Payments Upon Termination or Change of Control

CST Brands has not entered into employment agreements with any of our NEOs. There is no acceleration of vesting grants upon a change of control of the Company. Although not in place, the Company is considering a formal change of control and severance policy, which would include participation by our NEOs.

Potential Payments upon Termination

Each of the Company’s NEOs is expected to receive amounts earned during his or her period of employment unless he or she voluntarily resigns prior to becoming retirement-eligible or is terminated for cause. Such amounts include:

Although normal retirement age under our benefit plan is 65, early retirement provisions were included into the Existing Omnibus Plan as of November 11, 2013 to allow receipt of benefits at earlier ages if vesting requirements are met. For the Company’s incentive compensation programs (Short-Term and Long-Term Incentives), early retirement is generally defined as termination at or after the age of 55 with five years of service. Any stock and option grants made prior to November 11, 2013 do not have the early retirement provisions included in the plan or individual grant agreements.

As of December 31, 2013, only Messrs. Bartys and Motz were early retirement eligible under both our benefit plans and our compensation programs. Therefore, as of December 31, 2013, a voluntary resignation of Messrs. Bartys and Motz would have been treated as a retirement. Since they were then eligible for retirement under these programs, they would have been able to resign and retain their annual short-term incentive and vested stock and option awards. Any outstanding stock and option awards would have been forfeited.

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COMPENSATION OF DIRECTORS

All compensation paid to directors is limited to non-employee directors. We use a combination of cash and stock-based incentive compensation to attract and retain qualified individuals to serve on the Board. In addition to the compensation provided above, CST Brands does reimburse directors for travel expenses. The following non-employee director compensation components are currently in effect:

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DIRECTOR COMPENSATION FOR FISCAL YEAR 2013

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END 2013 TABLE

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PROPOSAL FIVE

ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES

ON EXECUTIVE COMPENSATION

The Dodd-Frank Wall Street Reform and Consumer Protection Act requires the Company to provide for an advisory stockholder vote to determine how often to present the advisory stockholder vote to approve the compensation of the Company’s NEOs (the “say-on-pay vote”). The Company must solicit your advisory vote on whether to have the say-on-pay vote every 1, 2, or 3 years. Stockholders may vote as to whether the say-on-pay vote should occur every 1, 2 or 3 years, or may abstain from voting on the matter. The frequency (every 1, 2 or 3 years) that receives the highest number of votes will be deemed to be the choice of the stockholders.

The Company values the opinion of our stockholders and welcomes communication regarding our executive compensation policies and practices. After taking into account various considerations described below, the Company believes that an annual vote will provide stockholders with the ability to express their views on the Company’s executive compensation policies and practices while providing with an appropriate amount of time to consult with stockholders and to consider their input.

The Company’s executive compensation is administered by the Compensation Committee, as described in this Proxy Statement. Compensation decisions are complex and, with respect to our NEOs, are disclosed in this Proxy Statement. The Company believes that establishing a one-year time frame for holding stockholder advisory votes on executive compensation will both enhance stockholder communication and provide the Compensation Committee time to consider, engage with and respond to stockholders’ expressed concerns or other feedback. In addition, the Company also believes that an annual vote is consistent with our long-term business strategy and gives the Compensation Committee sufficient time to measure long-term performance.

Although, as an advisory vote, this proposal is not binding upon CST Brands or its Board of Directors, the Board will carefully consider the stockholder vote on this matter.

While you have the opportunity to vote for every 1, 2 or 3 years, or abstain from voting on the frequency of future say-on-pay votes, the Board of Directors recommends that you vote “FOR” one year.

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GOVERNANCE DOCUMENTS AND CODES OF ETHICS

The Company adopted a Code of Ethics for Senior Financial Officers that applies to our principal executive officer, principal financial officer, and controller. The code charges these officers with responsibilities regarding honest and ethical conduct, the preparation and quality of the disclosures in documents and reports we file with the SEC, and compliance with applicable laws, rules, and regulations. We also adopted a Code of Business Conduct and Ethics, which applies to all of our employees, officers and directors. This Code is a statement of CST Brands’ high standards for ethical behavior, legal compliance and financial disclosure.

We post the following documents, as well as any waiver of a provision of the Code of Business Conduct and Ethics granted to any executive officer or director or material amendment to this Code, if any, on our website at www.cstbrands.com under the “Corporate Governance” tab in the “Investor Relations” section. A printed copy of any of these documents is available to any stockholder upon request. Requests for documents must be in writing and directed to CST Brands’ Corporate Secretary at the address indicated on the cover page of this Proxy Statement.

The information contained on our website is not incorporated herein by reference and does not comprise a part of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

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STOCKHOLDER PROPOSALS FOR 2015 CST BRANDS ANNUAL MEETING

CST Brands intends to hold its next annual meeting during the second quarter of 2015, according to its normal schedule.

Stockholders who intend to have a proposal considered for inclusion in the proxy materials for presentation at the 2015 Annual Meeting of Stockholders pursuant to Rule 14a-8 of the Exchange Act must comply with the requirements of Rule 14a-8, which lists the requirements for the inclusion of stockholder proposals in company-sponsored proxy materials. A stockholder proposal pursuant to Rule 14a-8 for the 2015 Annual Meeting must be received by the corporate secretary at our principal executive offices by December 22, 2014, which is 120 calendar days prior to the anniversary of the date of this Proxy Statement.

If you wish to present a stockholder proposal at the 2015 Annual Meeting of stockholders that is not the subject of a proposal pursuant to Rule 14a-8, then you must following the procedures outlined in Article I of our Amended and Restated Bylaws. According to our Amended and Restated Bylaws, CST Brands must receive timely written notice of any stockholder nominations and proposals to be properly brought before the 2015 Annual Meeting. To be timely, such notice must have been delivered to the CST Brands Secretary at the principal executive offices set forth on the first page of this Proxy Statement between March 6, 2015 and the close of business on April 3, 2015.

The written notice must set forth, as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (A) the name and address of such stockholder, as they appear on the Company’s books, and of such beneficial owner, if any, (B) the class or series and number of shares of the Company that are owned beneficially and of record by such stockholder and such beneficial owner, if any, as of the date of such notice (which information shall be supplemented by such stockholder and beneficial owner not later than 10 days after the Record Date for the meeting to disclose such ownership as of the Record Date), and (C) any other information relating to such stockholder and beneficial owner that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in a contested election pursuant to Section 14 of the Exchange Act.

The notice must set forth, as to each person, if any, whom the stockholder proposes to nominate for election or reelection as a director: (A) all information relating to such person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14 of the Exchange Act (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected) and (B) a description of all direct and indirect compensation and other monetary agreements, arrangements and understandings during the past three years, and any other relationships, between or among such stockholder and beneficial owner, if any, and their respective affiliates and associates, or others acting in concert therewith or any other third party, on the one hand, and each proposed nominee, and his or her respective affiliates and associates, or others acting on concert therewith, on the other hand, including, without limitation all information that would be required to be disclosed pursuant to Rule 404 promulgated under Regulation S-K if the stockholder making the nomination and any beneficial owner on whose behalf the nomination is made, if any, or any affiliate or associate thereof or person acting in concert therewith, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant, and (C) disclosure of any agreement, arrangement or understanding with any person or entity other than the Company with respect to any direct or indirect compensation, reimbursement or indemnification, and/or disclosure of any compensation or other payment received from any person or entity other than the Company in connection with their candidacy or service or action as a director of the Company and/or disclosure of any compensation or other payment received from any person or entity other than the Company in connection with their candidacy or service as a director of the Company.

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With respect to each nominee for election or reelection to the Board of Directors, the notice must include the completed and signed questionnaire, representation and agreement required by the Company’s bylaws. The Company may require any proposed nominee to furnish such other information as may reasonably be required by the Company to determine the eligibility of such proposed nominee to serve as an independent director of the Company or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such nominee.

If the notice relates to any business other than a nomination of a director or directors that the stockholder proposes to bring before the meeting, the notice must set forth (A) a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest of such stockholder and beneficial owner, if any, in such business, and (B) a description of all agreements, arrangements and understandings between such stockholder and beneficial owner and any other person or persons (including their names) in connection with the proposal of such business by such stockholder.