Exhibit 10.29





 


	
  PERSONAL AND
  CONFIDENTIAL

  	
   

  	
  June 22, 2006

  



 


Dear Irene,


I am very pleased
to provide you with this letter confirming the verbal offer that I extended to
you for the position of Chief Executive Officer and a member of the Board of
Directors of Kraft Foods Inc. located in Northfield, IL.  We have agreed that, in the event of a spin-off
of Kraft Foods from Altria Group, you will be appointed Chairman and Chief
Executive Officer.  If you accept our
offer, we have discussed our interest in you joining Kraft on June 26,
2006.  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


	
  Annual Base Salary

  	
   

  	
  $1,300,000

  
	
   

  	
   

  	
   

  
	
  Target Management Incentive Plan - {150%*}

  	
   

  	
  $1,950,000

  
	
   

  	
   

  	
   

  
	
  Target Cash Long-Term Incentive Plan - {250%*}

  	
   

  	
  $3,250,000

  
	
   

  	
   

  	
   

  
	
  Target Annual Equity Award Range Restricted Stock

  	
   

  	
  $3,120,000 - $8,850,000

  



 






*                 Target as a
percent of base salary.









 



 


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 150% of your base salary. The actual amount you will receive is based upon
your individual performance and the performance of Kraft Foods Inc. Your 2006
award will represent a full year award, or as if you began employment on
January 1, 2006. This award will be paid at a minimum of your target in
February 2007.


You will also be eligible
to participate in the Long-Term Incentive Plan (LTIP), which is the Company’s
executive long-term cash incentive program. The current LTIP performance cycle
began on January 1, 2004 and is scheduled to end on December 31,2006. Your
eligibility in this performance cycle will be for one full year (2006), or as if
you began employment on January 1, 2006. This award will be paid at your target
in February 2007. Your target opportunity under the LTIP is equal to 250% of
your cumulative base salary during future performance cycles. The actual amount
you will receive is based upon your individual performance and the performance
of Kraft Foods Inc.


Also, you will be
eligible to participate in the Company’s stock award program. Stock awards are
typically made on an annual basis, with the next award cycle anticipated to be
in January 2007. The current stock program design is to deliver 100% of equity
value in the form of restricted stock with a three-year cliff vest. Award size
is based on individual performance and requires the approval of the
Compensation Committee of the Board of Directors.


Sign-On Incentives


In recognition of the
forfeiture of equity awards granted by your previous employer, upon hire, you
will receive one-time sign-on incentives in the form of a pension bridge and
restricted stock as follows:


	
  Pension Bridge

  	
   

  	
  Treated as if you had remained continuously employed
  by the Company since 1981

  
	
   

  	
   

  	
   

  
	
  Equity Sign-On Incentive

  	
   

  	
  $12,000,000

  



 


The Benefit Formula
applied to service under the pension bridge will be the formula applicable to
employees with less than 30 years of service regardless of you actual service
at retirement. Your average annual compensation shall be no less than your
initial annual base salary and your initial MIP target award.


Upon hire, you will
receive a one-time restricted stock award valued at $12,000,000. The 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
receive dividends on the shares during the vesting period consistent in amount
and timing with that of Common Stock shareholders. The stock award will vest
based on the following schedule:




	
  Value

  	
   

  	
  Vesting Date

  	
   

  
	
  $ 5,000,000

  	
   

  	
  July 1, 2009

  	
   

  
	
  $ 7,000,000

  	
   

  	
  July 1, 2011

  	
   

  






 


In addition to the terms
and conditions set forth in Kraft’s standard Stock Award Agreement (a form of
which is delivered herewith) Kraft will include the following addition:


If, prior to full vesting
of the shares granted per this award agreement, the Employee’s employment with
the Company ends due to involuntary termination for reasons other than cause,
the value of the total number of unvested shares shall vest at the vesting
dates scheduled above. (In Kraft’s standard award agreement, shares will
automatically vest in case of death or permanent disability.) In addition, in
the case of a Change in Control, the shares will vest immediately in accordance
with the Company’s Performance Incentive Plan. The Company agrees that it will
reimburse you and fully gross you up for any excise or additional taxes if any
are incurred from the vesting of these shares. These shares shall also vest if
(1) you fail to be named Chairman of the Company’s Board of Directors on or
before January 1, 2008 or (2) anyone other than Louis Camilleri or you is
appointed Chairman of the Company’s Board of Directors.


For purposes of this
offer letter, “cause” means: 1) continued failure to substantially perform the
job’s duties (other than failure 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.


Perquisites


You will be eligible for
a company car allowance under the executive perquisite policy. The Company
leases new company cars for business and personal use by executives. Under the
policy, cars are leased for a three-year period. The Company will provide you
with a car with a maximum value of $70,000. You can invest your own funds if
the value of the car exceeds $70,000. You will have an opportunity to purchase
the car at the end of the lease period.









 



 


You will be
eligible for an annual financial counseling allowance of $10,000.  You may use any firm of your choosing.  In addition, for personal security and
safety, the Company will provide a security system for your residence and
personal use of the Company’s aircraft.


The Company will
provide relocation benefits with a full tax gross-up.  This will include up to one year of temporary
housing and, if necessary, current residence buy-out at fair market value.


Stock
Ownership Guidelines


You will be
required to attain and hold Company stock equal in value to twelve 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 five weeks of
vacation, as if you had remained in full employment from 1981.  In addition, you are eligible for ten
designated holidays and two personal days.


Immediately upon your
hire, you shall be deemed retiree eligible under all equity and employee
pension and welfare benefit plans, programs and practices of the Company.


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.


You shall be
reimbursed for your reasonable professional fees to complete the review of your
employment arrangements with the Company.


This offer of
employment will expire ten (10) days from the date of this letter.  If you accept our offer, please indicate your
acceptance by signing below and returning a copy of this letter by fax to me at
917 663-5777.









 



 


I look forward to
your favorable response to our offer.  If
you have any question regarding any of the elements of your offer, please
contact me at 917 663-2121.


Sincerely,


 


	
  /s/ Louis C. Camilleri

  	
   

  	
  CHAIRMAN KRAFT FOODS,
  INC.

  
	
   

  
	
   

  
	
  I accept the offer as
  expressed above.

  
	
   

  
	
   

  
	
  /s/ Irene B. Rosenfeld

  	
   

  	
    6/24/06.

  	
   

  
	
  Signature

  	
   

  	
  Date

  
						



 


	
  Enclosure:

  	
  Kraft Foods Benefits
  Summary

  
	
   

  	
  Restricted Stock
  Agreement