EXHIBIT 10.3E

CHS ANNUAL VARIABLE PAY PLAN
MASTER PLAN DOCUMENT    

Plan Purpose

The purpose of the CHS Annual Variable Pay Plan (the “Plan”) is to provide a
direct financial incentive for eligible employees (each a “Participant”) who
contribute to the achievement of CHS priorities, as well as individual employee
performance goals that are aligned with CHS priorities and Leadership
Expectations.
The objectives of this Plan are to:
•
Drive strong business performance and reward Participants for achieving
challenging goals

•
Emphasize shared ownership of CHS priorities, and reward for the achievement of
results through collaborative work efforts

•
Create a line of sight for Participants to see how their actions contribute to
the achievement of CHS priorities

•
Reward goal achievement that is competitive with compensation in the external
market and aligns with organizational and market best practices

Performance Period

Each performance period for the Plan (“Performance Period”) will be a CHS fiscal
year, currently September 1 through August 31. A new Performance Period begins
each fiscal year.
Plan Trigger

Except as may be expressly determined for any Performance Period, the Threshold
Return on Invested Capital (ROIC) Performance, as identified in the Plan
Appendix, must be met in order for all or a portion of award compensation to be
earned under the Plan.
•
If the company Threshold ROIC Performance is attained, then compensation earned
under all Plan components, including enterprise, business unit and individual
goals, are calculated independently.

•
If company Threshold ROIC Performance is not attained, the following will occur:

◦
Corporate participants’ opportunity for an earned award is zero for all plan
components.

◦
Business unit participants’ opportunity for an earned award is zero for all Plan
components unless the business unit ROA goal is achieved at the target
performance level or higher. If the business unit target ROA goal is achieved,
then compensation is earned for the performance achieved at the business unit
ROA target performance level or higher for the ROA Plan component only.

Company ROIC and business unit ROA goals are defined in the following Plan Goals
section and the Plan Appendix.
Plan Goals

Corporate functions and business units have predetermined goals and weightings
which include CHS ROIC, CHS or business unit Return on Assets (ROA), and
individual goals.
The President and Chief Executive Officer (CEO) and the Chief Financial Officer
(CFO) establish, and the CHS Board of Directors approves, the Threshold, Target
and Maximum ROIC and ROA Performance Targets at the corporate level for each
Performance Period established pursuant to the Plan. Business unit ROA goals are
determined by the CEO and CFO in collaboration with senior finance and business
unit leaders. The ROIC and ROA performance targets for each such Performance
Period are measured only over the entire Performance Period.
Compensation for any Performance Period is earned as a percent of the Target
award and is mathematically interpolated when performance results occur between
the three financial Performance Targets.

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EXHIBIT 10.3E

Financial Performance Targets
Description
Award as % of Target
Maximum
Maximum Performance Goal
200%
Target
Targeted Performance Goal
100%
Threshold
Minimum Performance Goal
50%

The company ROIC and business unit ROA Performance Targets are published in the
Plan Appendix after the beginning of each new Performance Period.
Goals are weighted based on whether Participants are in a corporate function or
a business unit. The table below illustrates goal weightings by employee groups.
Employee Group
ROIC
ROA
Individual
Corporate Participants
60%
10%
30%
Business Unit Participants
10%
60%
30%

ROIC is measured at the enterprise level for corporate and business unit
Participants, ROA is measured at the enterprise level for corporate
Participants, and at the business unit level, as determined by the CEO and CFO
in collaboration with senior finance and business unit leaders, for business
unit Participants. ROIC and ROA goals are communicated to business unit leaders
and Participants by Finance. Individual goals are determined by the
Participant’s manager and the Participant.
Award Methodology

Each Participant’s award opportunity pursuant to the Plan for any Plan Period
(“Award Opportunity”) varies by grade level and/or position and is expressed as
a percent of base pay. The Company can vary a Participant’s award opportunity by
grade level and/or position at the sole discretion of the Plan Administrators.
For salaried employees, the base pay used to establish the award opportunity is
the employee’s base salary at the end of the Performance Period (August 31). For
hourly employees, the base pay used to establish the award opportunity is actual
earnings during the Performance Period, to include base pay and overtime
earnings.
Award opportunity and calculation examples are included in the Plan Appendix.
Award Payment

Actual compensation earned under the Plan for any Performance Period is
determined, approved and issued as soon as administratively feasible following
the close of the Performance Period. No compensation shall be deemed earned
under the Plan until after approval by the CHS Board of Directors. Awards can be
modified or terminated without Participant consent for any reason up until the
CHS Board of Directors approves the amounts earned under the awards. Once such
amounts are approved, the awards cannot be modified or terminated, except as is
expressly provided in the Plan. In all cases, any compensation earned under the
Plan shall be paid no later than November 30 following the Performance Period
for which it was earned. Compensation paid under the Plan is paid through the
same process as the Participant’s paycheck. All payments are subject to
appropriate withholdings.
Administration

The CFO and CHRO administer the Plan (each a Plan Administrator). The Plan
Administrators, along with the CEO, are authorized to make all decisions as
required in the administration of the Plan and to exercise their discretion to
define, interpret, construe and apply Plan provisions, approve, administer,
withdraw, and make any exceptions to the terms of the Plan. Any adjustments to
the Plan based on extraordinary business conditions requires CHS Board of
Directors and CFO approval at the company level, and CEO and CFO approval at the
business unit level.
Eligibility

•
Participants must be employed by the company in an eligible non-union position,
categorized as a full-time or part-time regularly scheduled employee at the end
of the Performance Period or have a status change during the Performance Period,
as defined in the table below. Employees who cease being employed after the end

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EXHIBIT 10.3E

of the Performance Period and before the actual payment date will be paid any
compensation earned under the Plan for that Performance Period.
•
Participants must have a hire or transfer date to an eligible position on or
before June 1 of the Performance Period.

•
Salaried Participants who become eligible during the Performance Period will
earn and be paid prorated compensation, based on the number of days worked in an
eligible position during the Performance Period, divided by 365. Hourly
Participants who become eligible during the Performance Period will earn and be
paid compensation, based on actual earnings in an eligible position during the
Performance Period, to include base pay and overtime earnings.

•
Participant awards may be prorated based on changes in compensation or role
during the Performance Period, at the sole discretion of the Participant’s
manager and the business unit Human Resources Director.

•
Participants must actively work a minimum of 30 days during the Performance
Period to be eligible to earn compensation under the Plan for that Performance
Period.

•
Prorated awards, and portions of earned awards that have not yet been paid for
Participants who are no longer employed by the company due to an eligible status
change will be determined, approved and issued as soon as administratively
feasible following the close of the Performance Period.

•
Employees who are eligible to earn variable compensation through any other
bonus, commission or incentive plan are not eligible to participate in the Plan
and will not be a Participant for purposes of this Plan, unless approved by the
Plan Administrators.

•
Employees who are eligible to earn compensation as a full-time or part-time
regularly scheduled employee and have a status change to Layoff at the end of
the Performance Period are not eligible to participate in the Plan.

•
Participants may forfeit their eligibility to earn compensation under the Plan
for any Performance Period, or have their award opportunity modified at the
discretion of the Plan Administrators, if it is determined that the Participant
has failed to meet job performance criteria and standards, which includes but is
not limited to documented performance issues, or that they have committed acts
of misconduct, dishonesty or violation of CHS policies and procedures.
Forfeiture of eligibility must be approved by the business unit Human Resources
Director and Compensation Director.

•
The following status table outlines eligibility status criteria and how
compensation earned under the Plan is prorated when a change in status occurs
during the Performance Period:

Status
Proration Rule
Deceased
Days actually worked
Full Time
Days actually worked
Leave of Absence
First 90 days
Long-Term Disability
Days actually worked
Military Leave
First 90 days
Part Time
Days actually worked
Position Elimination (including Divestiture)
Days actually worked
Retirement as defined by the CHS Retirement Plan rules
Days actually worked
Separation from employment and return to employment during Performance Period
Days actually worked before and after separation if employee returns before 90
days
Short-Term Disability (including FMLA)
First 90 days
Worker’s Compensation
First 90 days

* Not all eligible status criteria are included. Eligibility status criteria can
be changed at any time by the Plan Administrators. Contact your manager or Human
Resources Business Partner for more information on status definitions.
** This Plan document applies to eligible U.S. and Canadian employees and
expatriates. Plan documents are customized by region for eligible international
Participants.
*** Primary eligibility for the Plan is defined by business unit and position.
Groups of employees that are not eligible for the Plan after consideration of
the eligibility rules above include: Energy Certified Energy Specialists; Energy
Transportation and Distribution Drivers; Energy Zip Trip store employees below
the C-Store Manager level; Production Incentive eligible employees; Temco
Terminal employees; Ag Associates; Country Operations employees below the Vice
President level without a department name beginning with CO. This list can be
changed at any time by the Plan Administrators.

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EXHIBIT 10.3E

General Provisions

CHS reserves the right to change or cancel this plan at any time. This document
does not intend to create an employment contract or provide a guarantee of
continued employment. Contact your manager or HR Business Partner for more
information on the CHS Annual Variable Pay Plan. There is no vested right to any
payment prior to the award determination and the CHS Annual Variable Pay Plan
does not give rise to any vested right to future payments.
Non-Recurring Events
Non-recurring business events, which have a substantial impact on CHS financial
results during the Plan Period, may be excluded from the calculations for
determining awards. Such events could include but are not limited to, major
gains or losses from acquisitions (including planned short-term losses),
divestitures, lawsuits, significant business write-offs, casualty losses or sale
of assets.
Clawback or Recoupment
All earned awards under this Plan shall be subject to recovery or the penalties
pursuant to any applicable law, rule or regulation or applicable stock exchange
rule, including, without limitation, Section 304 of the Sarbanes-Oxley Act of
2002, Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection
Act and any applicable stock exchange listing rule adopted Pursuant thereto.