Exhibit 10.1

LOGO [g233422ex10_1-pg001.jpg]

Karen J May

Executive Vice President

Human Resources

Three Lakes Drive

Northfield, IL 60093

XXX-XXX-XXXX - phone

XXX-XXX-XXXX - fax

XXXXX.XXX@kraftfoods.com

PERSONAL AND CONFIDENTIAL

June 20, 2011

Mr. Daniel Myers

Dear Daniel,

I am very pleased to provide you with this letter confirming the verbal offer
that has been extended to you for the position of Executive Vice President
Supply Chain located in Northfield, Illinois, USA. If you accept our offer, it
is our interest that you join Kraft as soon as possible which we understand will
be in early September. This letter sets forth all of the terms and conditions of
the offer.

Listed below are details of your compensation and benefits that will apply to
this offer.

Annualized Compensation (Range of Opportunity)

 

     Target - Maximum  

Annual Base Salary

   $ 575,000   

Annual Incentive Plan (Target* - 60%)

   $ 345,000 - $862,500   

Long-Term Incentives**

   $ 838,750 - $1,502,500   

- Performance Shares (Target* - 85%)

   $ 488,750 - $977,500   

- Restricted Stock/Stock Options Award Range

   $ 350,000 - $525,000   

Total Annual Compensation

   $ 1,758,750 - $2,940,000   

 

* Target as a percent of base salary.

** The value of the long-term incentive awards reflects the “economic value” of
equity awards. For performance and restricted shares, the value reflects grant
value. For stock option value, the value approximates the Company’s
Black-Scholes value.

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June 20, 2011

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Annual Incentive Plan

You will be eligible to participate in the Kraft Management Incentive Plan
(MIP), which is the Company’s annual incentive program. Your target award
opportunity under the MIP is equal to 60% of your base salary. The actual amount
you will receive may be lower or higher depending on your individual performance
and the performance of Kraft Foods Inc. Your 2011 award will be payable in March
2012. Your MIP eligibility will begin on your date of employment.

Long-Term Incentives

Performance Shares

Your eligibility for the Kraft performance share program (referred to as Kraft
Foods’ Long-Term Incentive Plan or LTIP) will commence with the 2012 – 2014
performance cycle. Your target opportunity under the LTIP is equal to 85% of
your base salary at the beginning of the performance cycle. The actual award you
will receive may be lower or higher depending upon the performance of Kraft
Foods Inc. during the performance cycle. The number of performance shares under
the 2012 – 2014 performance cycle is equal to your target value divided by the
fair market value of Kraft stock on the first business day of the performance
cycle.

The 2012-2014 performance shares will vest in early 2015. It is anticipated that
a new three year performance cycle will begin each year in January. Beginning in
2015, if you remain employed and performance is above threshold, performance
shares will vest each year at the conclusion of each performance cycle.

In the event that you voluntarily leave the organization after your five year
anniversary, any performance share grants that are in the final year of the
performance cycle will vest on a prorated basis, based on your date of
separation. The actual award will be paid at the same time as other executives
and the actual award amount will be dependent on the actual performance achieved
during the respective performance cycle. All other outstanding awards will be
forfeit upon your separation. In the event that you voluntarily leave the
organization prior to your five year anniversary, you may receive prorated
amounts as described earlier in this paragraph at the sole discretion of the
Human Resources and Compensation Committee of the Board of Directors.

Restricted Stock/Stock Option Program

You will also be eligible to participate in the Company’s restricted stock and
stock option award program. Stock awards are typically made on an annual basis,
with the next award anticipated to be granted in the first quarter of 2012.
Awards are delivered as follows: 50% of equity value is delivered in restricted
stock and 50% in stock options. Actual award size is based on individual
potential and performance. You will receive dividends on the restricted shares
during the vesting period consistent in amount and timing with that of Common
Stock shareholders.

 

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The number of stock options granted is typically communicated as a ratio
relative to the number of restricted shares granted based on the “economic
value” of the stock options. In 2011, Kraft Foods granted 6 stock options for
every restricted sharer awarded. This ratio may change from year to year.

In the event that you voluntarily leave the organization after your five year
anniversary, any restricted grant that will vest in the subsequent year will
partially vest on a two-thirds basis at the time of your separation. In
addition, all stock options granted in years prior to the year of separation
will continue to vest on their regularly scheduled vesting dates and will have
their full original term in which you may exercise. All other outstanding awards
will be forfeit upon your separation. In the event that you voluntarily leave
the organization prior to your five year anniversary, you may receive prorated
awards as described earlier in this paragraph at the sole discretion of the
Human Resources and Compensation Committee of the Board of Directors.

Restricted Stock Sign-On

As part of your employment offer, to offset loss of compensation at your current
employer and to ensure that you begin participating in our long-term
compensation programs immediately, you will receive a one-time restricted stock
award equal in value to $1,400,000. The vesting of these shares will be as
follows:

 

  •  

$500,000 will vest approximately one-third (or 33%, 33%, and 34%) on each of the
first three anniversary dates from the date of grant.

 

  •  

$900,000 will vest 100% after five years.

The actual number of shares that you will receive will be determined based upon
the fair market value of Kraft Foods Inc. Common Stock on your date of hire. You
will be paid cash dividends on the shares during the vesting period consistent
in amount and timing with that of Common Stock shareholders.

The other terms and conditions set forth in Kraft’s standard Stock Award
Agreement will apply.

Perquisites

You will be eligible for a company car allowance equal to $15,000 per year under
the executive perquisite policy. You will also be eligible for an annual
financial counseling allowance of $7,500. You may use any firm of your choosing
and submit payments directly to the Company.

Deferred Compensation Program

You will be eligible to participate in the Executive Deferred Compensation
Program. This program allows you to voluntarily defer a portion of your salary
and/or your annual incentive to a future date. Investment opportunities under
this program are designed to mirror the Company’s 401(k) plan. Additional
information for this program can be made available upon request.

 

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Stock Ownership Guidelines

You will be required to attain and hold Company stock equal in value to four
times your base salary. You will have five years from your date of employment to
achieve this level of ownership. Stock held for ownership determination includes
common stock held directly or indirectly, unvested restricted stock or share
equivalents held in the Company’s 401(k) plan. It does not include unexercised
stock option shares.

Other Benefits

Your offer includes Kraft’s comprehensive benefits package available to
full-time salaried employees. This benefits package is described in the enclosed
Kraft Benefits Summary brochure. You will be eligible for 30 days of Paid Time
Off (PTO). In addition, you are eligible for ten designated holidays and two
personal days.

You will be a U.S. employee of Kraft Foods and your employment status will be
governed by and shall be construed in accordance with the laws of the United
States. As such, your status will be that of an “at will” employee. This means
that either you or Kraft is free to terminate the employment relationship at any
time, for any reason.

If your employment with the Company ends due to an involuntary termination other
than for cause, you will receive severance arrangements no less favorable than
those accorded recently terminated senior executives of the Company. The amount
of any severance pay under such arrangements shall be paid in equal installments
at the regularly scheduled dates for payment of salary to Kraft executives and
beginning within 30 days of your termination.

For purposes of this offer letter, “cause” means: 1) continued failure to
substantially perform the job’s duties (other than resulting from incapacity due
to disability); 2) gross negligence, dishonesty, or violation of any reasonable
rule or regulation of the Company where the violation results in significant
damage to the Company; or 3) engaging in other conduct which materially
adversely reflects on the Company.

To assist in your relocation from Ohio to Illinois, we offer relocation
assistance as outlined in Kraft’s Relocation Guide.

Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)

If you are a “specified employee” (within the meaning of Code section 409A) as
of your separation from service (within the meaning of Code section 409A):
(a) payment of any amounts under this letter (or under any severance arrangement
pursuant to this letter) which the Company determines constitute the payment of
nonqualified deferred compensation (within the meaning of Code section 409A) and
which would otherwise be paid upon your separation from

 

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service shall not be paid before the date that is six months after the date of
your separation from service and any amounts that cannot be paid by reason of
this limitation shall be accumulated and paid on the first day of the seventh
month following the date of your separation from service (within the meaning of
Code section 409A); and (b) any welfare or other benefits (including under a
severance arrangement) which the Company determines constitute the payment of
nonqualified deferred compensation (within the meaning of Code section 409A) and
which would otherwise be provided upon your separation from service shall be
provided at your sole cost during the first six-month period after your
separation from service and, on the first day of the seventh month following
your separation from service, the Company shall reimburse you for the portion of
such costs that would have been payable by the Company for that period if you
were not a specified employee.

Payment of any reimbursement amounts and the provision of benefits by the
Company pursuant to this letter (including any reimbursements or benefits to be
provided pursuant to a severance arrangement) which the Company determines
constitute nonqualified deferred compensation (within the meaning of Code
section 409A) shall be subject to the following:

 

(a) the amount of the expenses eligible for reimbursement or the in-kind
benefits provided during any calendar year shall not affect the amount of the
expenses eligible for reimbursement or the in-kind benefits to be provided in
any other calendar year;

 

(b) the reimbursement of an eligible expense will be made on or before the last
day of the calendar year following the calendar year in which the expense was
incurred; and

 

(c) your right to reimbursement or in-kind benefits is not subject to
liquidation or exchange for any other benefit.

This offer is contingent upon successful completion of our pre-employment
checks, which may include a background screen, reference check, and post-offer
drug test pursuant to testing procedures determined by Kraft Foods.

 

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If you have any questions, I can be reached at the office at (XXX) XXX-XXXX or
on my cell phone at (XXX) XXX-XXXX.

Sincerely,

/s/ Karen May

I accept the offer as expressed above.

 

/s/ Daniel P. Myers

    

June 20, 2011

   Signature      Date   

 

Enclosure:    Kraft Foods Benefits Summary    Kraft Foods Relocation Policy   
Management Incentive Plan Brochure    Long-Term Incentive Plan Brochure   
Equity Brochure

 

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