Exhibit 10.1


[CBS Corporation
Letterhead]


December 29, 2005


 


Sumner M. Redstone

c/o Viacom Inc.

1515 Broadway

New York, New York 10036


 


Dear Mr. Redstone:


 


You have previously
entered into an employment agreement with Viacom Inc., a Delaware corporation (“Viacom”),
effective as of July 1, 2004 (the “Viacom Employment Agreement”),
pursuant to which you served as chairman of the board of directors and chief
executive officer of Viacom.  In
connection with the merger (the “Merger”) of Viacom and Viacom Merger Sub
Inc., a Delaware corporation (“Viacom Merger Sub”), and the related
separation of the business of New Viacom Corp., a Delaware corporation (“New
Viacom”) and CBS Corporation (“CBS”), CBS is entering into this
letter agreement with you (the “Agreement”).  The Viacom Employment Agreement will continue
in effect until the effective date of the closing of the Merger (the “Effective
Date”), at which time it will be superseded and replaced in full by this
Agreement.  If for any reason the Merger
is not consummated, this Agreement shall not enter into effect and shall be
considered null and void.


 


1.             Title;
Duties; and Effective Date.  As of
and following the Effective Date, you will be employed as Executive Chairman
and Founder of CBS and will serve in this capacity pursuant to the terms of
this Agreement.  As of the Effective
Date, you will no longer have the title of Chief Executive Officer.  As Executive Chairman and Founder of CBS, you
shall have all the rights, powers, authority, functions, duties and responsibilities
customarily associated with the position of an executive chairman, and such
additional rights, powers, authority, functions, duties and responsibilities as
are assigned to the office of Chairman of the Board under CBS’s Amended and
Restated Bylaws and as the Board of Directors of CBS (the “Board”) may
assign to you from time to time that are commensurate with your status as Executive
Chairman and Founder.  Without limiting
the foregoing, you will be actively engaged in, and have responsibility,
working with the Board and the President and Chief Executive Officer of CBS
(the “CEO”), for (a) the overall leadership and strategic direction
of CBS, (b) providing guidance and support to senior management of CBS, (c) the
coordination of the activities of the Board and (d) communication with
shareholders and other important constituencies.  The CEO shall report directly to you and to
the Board, and you will be given regular access to senior management of CBS.  CBS acknowledges that in addition to your services
pursuant to this Agreement, you will simultaneously serve as executive chairman
and founder of New Viacom.


 





















 


2.             Compensation.  As the sole compensation for services to be
rendered by you in all capacities to CBS, its subsidiaries and Affiliates, you
will receive the compensation specified herein from CBS.  For purposes of this Agreement, “Affiliate”
means any corporation or other entity that is controlled by CBS.


 


(a)           Salary.  For all the services rendered by you in any
capacity hereunder, CBS agrees to pay you salary at the rate of One Million
Seven Hundred Fifty Thousand Dollars ($1,750,000) per annum (the “Salary”),
payable in accordance with CBS’s then effective payroll practices but no less
frequently than semi-monthly.


 


(b)           Deferred Compensation.  In addition to your Salary, you shall earn,
with respect to each payroll period during your employment with CBS, additional
amounts (“Deferred Compensation”), the payment of which (together with
the return thereon as provided in this paragraph 2(b)), shall be deferred until
January of the first calendar year following the year in which you cease
to be an employee of CBS and payable at that time or at such later date as
shall be determined pursuant to paragraph 13, provided, however,
that, except in the event of your death, the Deferred Compensation will not be
payable to you earlier than six (6) months following your termination of
employment. The Deferred Compensation shall be based on an annualized rate of
One Million Three Hundred Thousand Dollars ($1,300,000).  Deferred Compensation shall be credited to a
bookkeeping account maintained by CBS on your behalf, the balance of which
account shall periodically be credited (or debited) with deemed positive (or
negative) return calculated in the same manner, and at the same times, as the
deemed return on your account under the CBS Excess 401(k) Plan for Designated Senior
Executives (as such plan may be amended from time to time, the “Excess
401(k) Plan”) is determined (it being understood and agreed that, if at any
time during which the Deferred Compensation remains payable, your account
balance in the Excess 401(k) Plan is distributed in full to you, your Deferred
Compensation account shall continue to be credited or debited with a deemed
return based on the investment portfolio in which your Excess 401(k) Plan
account was notionally invested immediately prior to its distribution).  CBS’s obligation to pay the Deferred
Compensation (including the return thereon provided for in this paragraph 2(b))
shall be an unfunded obligation to be satisfied from the general funds of CBS.


 


(c)           Bonus Compensation.  In addition to your Salary and Deferred
Compensation, you shall be entitled to receive bonus compensation for each of
the calendar years during your employment with CBS, determined and payable as
follows (the “Bonus”):


 


(i)            Your Bonus for each of the
calendar years or portion thereof during your employment with CBS will be based
upon achievement of the performance goal(s) established by the compensation
committee of the Board (the “Compensation Committee”) for each calendar
year and partial calendar year performance period during your employment with
CBS and shall be determined, in accordance with the CBS Senior Executive
Short-Term Incentive Plan, as the same may be amended from time to time (the “Senior
Executive STIP”).


 


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(ii)           For 2005, the performance goals under the STIP were
established by the compensation committee of the board of directors of Viacom
pursuant to the Viacom Employment Agreement. 
The Compensation Committee and the compensation committee of the board
of directors of New Viacom (the “New Viacom Compensation Committee”)
will jointly determine the extent to which the 2005 performance goals were achieved
and the amount of your 2005 bonus.  CBS
will pay you 50% of the amount so determined from the Senior Executive STIP,
and New Viacom will pay you the remaining 50%.


 


(iii)          Your target Bonus for 2006 and each other calendar year or
portion thereof during your employment with CBS shall be two hundred percent
(200%) of your Salary and Deferred Compensation at the annualized rate in
effect at the end of such period.  Your
Bonus shall be prorated for any partial calendar year that you are employed by
CBS under this Agreement.


 


(iv)          Assuming the performance goals pre-established by the
Compensation Committee for each calendar year or partial calendar year
performance period during your employment with CBS has been achieved and
certified by the Committee, the Compensation Committee is entitled to use its
negative discretion to reduce the amount of the Bonus that you are entitled to
receive for such performance period.


 


(v)           Your Bonus for any calendar year during your employment with
CBS shall be payable by February 28th of the following year.  For the avoidance of doubt, it is understood
that you will receive the Bonus to which you are entitled for each calendar
year in which you were employed, even if you are not employed on February 28th
of the following year or on the actual date on which bonuses are paid for such
year.


 


(vi)          In the event that the Senior Executive STIP is amended or
terminated, you will be given an opportunity under the amended or successor
plan to earn bonus compensation equivalent to the amount that you could have
earned under this paragraph 2(c) but subject to the same limitations.


 


(d)           Long Term Compensation.  This paragraph 2(d) sets forth your
entitlements with respect to awards of long-term compensation under the CBS
2004 Long-Term Management Incentive Plan (the “2004 LTMIP”) or a
successor plan (collectively, the “LTMIP”):


 


(i)            Stock Option Grants.  Pursuant to the Viacom Employment Agreement,
the compensation committee of the board of directors of Viacom awarded you, on July 1,
2004, options to purchase an aggregate of One Million Five Hundred Thousand
(1,500,000) shares of Viacom Class B Common Stock (your “Viacom Options”)
as follows:


 


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(1)           a
grant of stock options to purchase Five Hundred Thousand (500,000) shares of
Viacom Class B Common Stock that vested on December 31, 2004; and


 


(2)           a
grant of stock options to purchase One Million (1,000,000) shares of Viacom Class B
Common Stock scheduled to vest in four (4) equal installments on July 1,
2005, July 1, 2006, July 1, 2007, and July 1, 2008.  Twenty-five percent (25%) of this grant,
covering Two Hundred Fifty Thousand (250,000) shares of Viacom Class B
Common Stock, vested on July 1, 2005 pursuant to the foregoing schedule.


 


Your Viacom Options were granted with a per share exercise price of
Thirty-Five Dollars and Fifty-One Cents ($35.51).  In connection with the Merger, your Viacom
Options will be converted into stock options under the 2004 LTMIP to purchase
shares of Class B Common Stock of CBS (“CBS Options”) and options
under the New Viacom Long-Term Management Incentive Plan (the “New Viacom
LTMIP”) to purchase shares of Class B Common Stock of New Viacom.  The number of your CBS Options, and the per
share exercise price therefor, will be determined in accordance with the Merger
Agreement, dated as of November 21, 2005, among Viacom, New Viacom and
Viacom Merger Sub (the “Merger Agreement”).  The vesting schedule of your CBS Options
will be the same as the vesting schedule for your Viacom Options before
the Merger, and your CBS Options will have such other terms (including without
limitation any terms relating to exercise periods, expiration, payment,
forfeiture, and the consequences of termination of employment and changes in
control) as apply to your Viacom Options before the Merger.


 


(ii)           Restricted Units.  Pursuant to the terms of the Viacom
Employment Agreement, the compensation committee of the board of directors of
Viacom awarded you a grant of One Hundred Fifteen Thousand (115,000) restricted
share units (the “Viacom Restricted Units”) during the first calendar
quarter of 2005.  Each Viacom Restricted
Unit corresponds to one (1) share of Viacom Class B Common Stock.


 


(1)           In
connection with the Merger, the Viacom Restricted Stock Units awarded to you in
2005 will be converted into a number of restricted shares units under the 2004
LTMIP (“CBS Restricted Units”) and a number of restricted share units
under the New Viacom LTMIP as determined in accordance with the Merger
Agreement.  Each CBS Restricted Unit will
correspond to one (1) share of Class B Common Stock of CBS.


 


(2)           The
vesting of your award of Viacom Restricted Units for 2005 was conditioned on a
performance goal requirement for a performance period that will end on December 31,
2005.  The Compensation Committee and the
New Viacom Compensation Committee will jointly determine the extent to which
such performance goal was achieved.  The CBS
Restricted Units will be payable only in shares of CBS Class B Common
Stock.  Notwithstanding anything herein
to the contrary, payment of the CBS Restricted Units will be deferred to the
date


 


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determined in accordance with paragraph 13 if such date is later than
the date on which payment would otherwise be made.


 


3.             Benefits.


 


(a)           You shall be entitled to participate in such medical, dental
and life insurance, 401(k), pension and other plans as CBS may have or
establish from time to time and in which any other CBS executives are eligible to
participate; provided, however, that for so long as you shall
remain an executive officer or other employee of CBS, the maximum amount of
compensation that may be taken into account to determine your benefits or
maximum deferrals under the CBS Excess Pension Plan and the CBS 401(k) Excess
401(k) Plan for Designated Senior Executives shall be fifty percent (50%) of
the amount that may be taken into account for CBS executives who are not New
Viacom employees.  It is understood and
agreed that all benefits you may be entitled to as an employee of CBS shall be
based upon your Salary plus Deferred Compensation (as though it were Salary),
as set forth in paragraphs 2(a) and 2(b) and subject to the proviso
of the preceding sentence, and not upon any bonus compensation due, payable or
paid to you hereunder, except where the benefit plan expressly provides
otherwise.  This paragraph 3(a) shall
not be construed to require CBS to establish any such plans or to prevent the
modification or termination of such plans once established, and no such action
or failure thereof shall affect this Agreement. 
In the event your benefits in such plans are reduced or terminated and
such reduction or termination was not the result of a change in law, CBS shall
continue to provide you with benefits equivalent to the benefits provided prior
to any such reduction or termination during your employment with CBS.  You shall be entitled to four (4) weeks
vacation.


 


(b)           CBS shall provide you with no less than Two Million Five
Hundred Thousand Dollars ($2,500,000) of life insurance during your employment
with CBS; provided that the amount of such life insurance, when
aggregated with life insurance provided to you by New Viacom, and the terms and
conditions under which it is provided, shall be no less favorable than the
amount of life insurance currently in effect for you from Viacom.  You shall have the right to assign the policy
for such life insurance to your spouse and/or issue or to a trust or trusts
primarily for the benefit of your spouse or issue.


 


4.             Business
Expenses, Perquisites.  During your
employment with CBS, you shall be reimbursed for such reasonable travel and
other expenses incurred in the performance of your duties hereunder on a basis
no less favorable than that provided by CBS to any of its senior executives but
in any event on a basis no less favorable to you than had previously been
provided to you prior to the date of this Agreement.  For so long as you shall remain an executive
officer or other employee of CBS, any travel or other expenses that you incur
on behalf of both CBS and New Viacom shall be apportioned between CBS and New
Viacom as determined by you in good faith pursuant to guidelines established
jointly by CBS and New Viacom.  Subject
to paragraph 3(a), you shall be entitled to receive all perquisites made
available by CBS from time to time during your employment with CBS to any other
senior executives of CBS but in any event on a basis no less favorable to you
than had previously been provided to you prior to the date of this Agreement; provided,
however, that your executive assistants will be provided by and employed


 


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by New Viacom.  Without limiting
the generality of the foregoing, you shall be entitled to (i) car
insurance in accordance with CBS’s policy and (ii) use of a private
airplane in accordance with CBS’s policy on a basis no less favorable than that
provided by CBS to any of its senior executives but in any event on a basis no
less favorable to you than had previously been provided to you prior to the
date of this Agreement.  CBS shall pay
all fees and expenses of your counsel and other fees and expenses which you may
incur in an effort to establish entitlement to compensation or other benefits
under this Agreement in the event that you ultimately prevail.


 


5.             Indemnification.


 


(a)           CBS shall indemnify and hold you harmless, to the maximum
extent permitted by law and by the Certificate of Incorporation and/or the
Bylaws of CBS, against judgments, fines, amounts paid in settlement of and
reasonable expenses incurred by you in connection with the defense of any pending
or threatened action or proceeding (or any appeal therefrom) in which you are or
may become a party by reason of your position as Executive Chairman and Founder
or any other office you may hold with CBS or its Affiliates or by reason of any
prior positions held by you with CBS or any of its Affiliates or predecessors
or for any acts or omissions made by you in good faith in the performance of any
of your duties as an officer of CBS.


 


(b)           To the extent that CBS maintains officers’ and directors’
liability insurance, you will be covered under such policy subject to the
exclusions and limitations set forth therein.


 


6.             Notices.  All notices required to be given hereunder
shall be given in writing, by personal delivery or by mail at the respective
addresses of the parties hereto set forth above, or at such other address as
may be designated in writing by either party. 
Any notice given by mail shall be deemed to have been given three days
following such mailing.


 


7.             Assignment.  This is an Agreement for the performance of
personal services by you and may not be assigned by you or CBS except that CBS
may assign this Agreement to any Affiliate of or any successor in interest to
CBS, provided that such assignee assumes the obligations of CBS hereunder.


 


8.             New
York Law, Etc.  This Agreement and
all matters or issues collateral thereto shall be governed by the laws of the
State of New York applicable to contracts entered into and performed entirely
therein.  Any action to enforce this
Agreement shall be brought in the state or federal courts located in the City
of New York.


 


9.             Termination
at Will.  This Agreement can be
terminated by either party at will upon notice to the other party, provided
that any termination is not intended, and shall not be construed, to affect
your rights in any compensation and benefits that have been granted or accrued
prior to such termination.


 


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10.           Entire
Understanding.  This Agreement
contains the entire understanding of the parties hereto relating to the subject
matter herein contained, and can be changed only by a writing signed by both
parties hereto.


 


11.           Void
Provisions.  If any provision of this
Agreement, as applied to either party or to any circumstances, shall be
adjudged by a court to be void or unenforceable, the same shall be deemed
stricken from this Agreement and shall in no way affect any other provision of
this Agreement or the validity or enforceability of this Agreement.


 


12.           Supersedes
Previous Agreements.  Effective as of
the Effective Date, this Agreement shall supersede and cancel all prior
agreements relating to your employment by CBS or any of its Affiliates and
predecessors, including, without limitation, the Viacom Employment Agreement
(and any incentive awards or other compensation contemplated or provided for
therein that are not granted or accrued as of the Effective Date).  Notwithstanding the preceding sentence, this
Agreement is not intended, and shall not be construed, to affect your rights in
any compensation or benefits that have been granted or accrued prior to the
Effective Date.


 


13.           Deductions
and Withholdings, Payment of Deferred Compensation.  All amounts payable under this Agreement
shall be paid less deductions and income and payroll tax withholdings as may be
required under applicable law and any property (including shares of CBS Class B
Common Stock), benefits and perquisites provided to you under this Agreement
shall be taxable to you as may be required under applicable law.  Notwithstanding any other provisions of this
Agreement to the contrary, no payment for any restricted share units or
distribution of any other deferred compensation shall be made sooner than the
earliest date permitted under the provisions of the Internal Revenue Code of
1986, as amended, or the rules or regulations promulgated thereunder, as
in effect on the date of such payment, in order for such payment to be taxable
at the time of the distribution thereof without imposition of additional taxes
under Section 409A of the Internal Revenue Code (including any regulations
and guidance thereunder).


 


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If the foregoing correctly
sets forth our understanding, please sign, date and return all four (4) copies
of this Agreement and return it to the undersigned for execution on behalf of
CBS; after this Agreement has been executed by CBS and a fully executed copy
returned to you, it shall constitute a binding agreement between us.


 


 


	
   

  	
  CBS CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Louis J. Briskman

  
	
   

  	
   

  	
  Name:

  	
  Louis J. Briskman

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President

  
	
   

  	
   

  	
  and General Counsel

  
	
   

  	
   

  
	
  ACCEPTED AND AGREED:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Sumner M. Redstone

  	
   

  	
   

  
	
  Sumner M.
  Redstone

  	
   

  
					



 


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