Exhibit 10.1

AGREEMENT AND RELEASE OF CLAIMS

    THIS AGREEMENT AND RELEASE OF CLAIMS (this "Agreement") is effective as of
October 2, 2006 (the "Effective Date"), by and between Federated Corporate
Services, Inc., a Delaware corporation (the "Company") and a subsidiary of
Federated Department Stores, Inc. ("Federated"), and RONALD W. TYSOE ("Tysoe").

WITNESSETH:

    WHEREAS,

Tysoe is currently employed by the Company pursuant to the terms of that certain
Employment Agreement, dated as of July 1, 2005 by and between Tysoe and the
Company (the "Employment Agreement"); and

    WHEREAS, the Company has given notice to Tysoe, pursuant to Section 1.6 of
the Employment Agreement, that the services that he currently performs will no
longer be required by the Company after October 5, 2006 (the "Separation Date")
but that limited services may be required as set forth herein until the date of
expiration of the Employment Agreement on June 30, 2007 (the "Retirement Date");
and

    WHEREAS, the parties desire to resolve and effect a final settlement of all
claims and all issues related to Tysoe's employment and his separation from
employment with the Company, and any and all claims against the Company,
Federated and their predecessors, subsidiaries, divisions, related or affiliated
companies, officers, directors, stockholders, members, employees, heirs,
successors, assigns, representatives, agents and counsel; and

    WHEREAS

, Tysoe and the Company are parties to that certain Severance Agreement (the
"Severance Agreement") providing for benefits upon a termination of employment
following a change in control of Federated, and this Agreement is intended to
supersede and replace in every respect the Severance Agreement.

    NOW

, THEREFORE, in consideration of the promises and agreements contained herein
and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, and intending to be legally bound, the Company and
Tysoe hereby agree as follows:

1.    Resignation. Tysoe hereby resigns, effective on the Separation Date, his
position as Vice Chair of Federated. Tysoe further resigns, effective on the
Separation Date: (a) from all other offices of the Company or Federated to which
he has been elected by the Board of Directors of the Company or Federated (or to
which he has otherwise been appointed), (b) from all directorships or offices of
any entity that is a subsidiary of, or is otherwise related to or affiliated
with, the Company or Federated, and (c) from all administrative, fiduciary or
other positions he may hold with respect to arrangements or plans for, of or
relating to the Company or Federated. The Company and Federated hereby consent
to and accept said resignations.

2.    Compensation and Benefits

. In consideration of the promises made in this Agreement and subject to the
conditions hereof, the Company and Tysoe agree to the following:
    Salary Payments
    . Tysoe will be entitled to continue to receive his base salary through the
    Retirement Date as follows: (i) Tysoe will receive $69,166.67 per month
    (payable in semi-monthly installments in accordance with the Company's
    regular payroll practices) until May 15, 2007; and (ii) Tysoe will receive a
    lump sum payment equal to $103,750, payable on or before May 15, 2007.
    
    
    
    
    Annual Incentive Plan
    . Tysoe will receive his annual bonus for the 2006 fiscal year, as earned,
    in accordance with the terms and conditions of the applicable plan, which
    bonus will be payable when payments under such plan are made to other
    Federated executives in March 2007. Tysoe will not be eligible for annual
    bonus participation after the fiscal year 2006 bonus period.
    
    
    
    
    Stock Credits
    . Tysoe will receive the earned stock credits for the 2004-2005 performance
    period, payable as soon as practicable on or after February 4, 2008 and
    February 2, 2009, but in no event later than December 31 of each such year.
    Tysoe will be also eligible to earn stock credits for the 2006-2007
    performance period, as determined by Federated's Compensation and Management
    Development Committee, payable as soon as practicable on or after February
    4, 2008, but in no event later than December 31 of such year. The number of
    stock credits earned for both the 2004-2005 performance period and the
    2006-2007 performance period will be calculated in accordance with the
    applicable stock credit plan, without taking into account any forfeiture
    provisions relating to, or any reduction as a result of, Tysoe's retirement.
    
    
    
    
    Equity Awards
    . Tysoe will not be eligible for any additional grants of equity awards
    after the Effective Date. Tysoe will continue to vest in his outstanding
    stock options through the Retirement Date and he will be permitted to
    exercise any such vested options until September 28, 2007. Tysoe
    acknowledges that all unvested options cease to vest and are forfeited as of
    the Retirement Date.
    
    
    
    
    Medical Coverage
    . Tysoe will be allowed to continue as a plan participant in the Company's
    medical and dental plans (the "Health Plans") until May 15, 2007 subject to
    the terms and conditions of the Health Plans, including, but not limited to,
    timely payment of any employee contributions necessary to maintain
    participation. Following May 15, 2007, Tysoe will be eligible to continue
    such medical and dental coverage under the Health Plans pursuant to the
    Consolidated Omnibus Budget Reconciliation Act of 1986, as amended
    ("COBRA");
    provided
    ;
    however
    , that Tysoe will be subject to all COBRA eligibility requirements and will
    be responsible for applying for COBRA coverage and paying the applicable
    premiums and, to the extent required by Section 409A of the Internal Revenue
    Code of 1986, as amended, all coverage will be concluded and all payments
    relating thereto will be made no later than December 31, 2008.
    
    
    
    
 a. Life Insurance; AD&D. Tysoe will be entitled to continuation of life and
    accidental death and dismemberment insurance benefits through the Retirement
    Date. After the Retirement Date, the Company will have no further
    obligations to Tysoe relating to life or accidental death and dismemberment
    insurance coverage.
    
    
    Retirement Benefits
    . Tysoe will receive a lump sum cash payment, payable by May 15, 2007, equal
    to $101,500, which the parties agree is the estimated difference between (i)
    the benefits Mr. Tysoe would have received under Federated's Cash Account
    Pension Plan and Supplementary Executive Retirement Plan (the "Retirement
    Plans") had he received service credit under such plans through June 30,
    2007 and (ii) the retirement benefits Mr. Tysoe will actually be entitled to
    receive under such Retirement Plans.
    
    
    
    
    Financial Counseling
    . Tysoe will be entitled to continuation of financial counseling benefits
    through May 15, 2007.
    
    
    
    
    Other Benefits
    . Tysoe will be entitled to continuation of his executive discount (and
    gross up payments related thereto), continued participation in the Company's
    executive car program, and continued use of a Company-paid cellular phone
    through May 15, 2007. Except as authorized by the Company in connection with
    its business needs, following the Separation Date, Tysoe will no longer be
    entitled to use of Federated's corporate aircraft for any purpose.
    
    
    
    
    Professional Fees
    . The Company and Tysoe acknowledge and agree that each will be responsible
    for the payment of their respective legal fees and costs (and related
    disbursements) incurred in connection with Tysoe's retirement and all
    matters relating to the negotiation and execution of the releases and all
    other matters covered by this Agreement.
    
    
    
    
    Long Term Disability
    . Tysoe expressly acknowledges that he has been informed that the Company's
    Long Term Disability coverage plan requires as a condition of participation
    that the employee be "actively at work" and that he will not, therefore, be
    eligible to continue to participate in such plan after the Separation Date,
    except as a result of exercise of any conversion rights as contained in the
    plan.
    
    
    
    
    Business Expenses
    . Tysoe will be responsible for any personal charges incurred on any Company
    credit card or other account used by him and Tysoe agrees to pay all such
    charges when due. The Company will reimburse Tysoe for any pending,
    reasonable business-related credit card charges for which Tysoe has not
    already been reimbursed provided Tysoe files a proper travel and expense
    report. Further, Tysoe will be entitled to reimbursement for reasonable
    travel and business-related expenses in connection with the performance of
    the duties contemplated by Paragraph 6(a).
    
    
    
    
    Withholding
    . The Company will withhold such amounts from the payments described in this
    Paragraph 2 as are required by applicable tax or other law.
    
    
    
    
    Other Rights and Obligations
    .
    
    
    
    
     i.   Nothing in this Agreement will affect the rights that Tysoe may have
          under Federated's Profit Sharing 401(k) Investment Plan, which rights
          will be governed by the terms thereof, as such plan may be modified
          from time to time consistent with the terms of such plan. It is
          understood and agreed by the parties that, except as provided in
          Paragraphs 2(d) and 2(g), this Agreement has no effect on Tysoe's
          rights accrued prior to the Retirement Date under the Company's
          Retirement Plans or its equity or deferred compensation plans.
          
          
     ii.  Except as specifically set forth in this Agreement, no other
          compensation or benefits are due Tysoe under this Agreement, the
          Employment Agreement, the Severance Agreement, or any other agreement,
          policy or program of the Company or Federated. Tysoe and the Company
          agree that the Severance Agreement will be terminated on the
          Separation Date, and that he is not owed any compensation or benefits
          under the Severance Agreement. Tysoe agrees that the compensation and
          benefits due him under this Agreement are intended to and do fully
          satisfy any obligation of the Company or Federated to Tysoe under the
          Employment Agreement and that the Employment Agreement is terminated
          as of the Separation Date; provided, however, that Section 2.2 of the
          Employment Agreement (Trade Secrets and Confidential Information)
          shall not terminate and shall continue to operate and be applicable to
          Tysoe. The parties further agree that Tysoe will not be required to
          mitigate the amount of any payment or benefit to be made under this
          Agreement by seeking other employment or otherwise and that Tysoe will
          be permitted to become a consultant to Perella Weinberg Partners
          earning in total, with respect to services rendered from the
          Separation Date until the Retirement Date (the "Consulting Period"),
          not more per month than fifty percent of the amount set forth in
          Paragraph 2(a)(i) hereof. Tysoe agrees to notify the Company in
          advance of any proposed subsequent employment, or consulting services
          to be rendered, during the Consulting Period (other than with or to
          Perella Weinberg Partners) and of the compensation to be received or
          receivable from such subsequent employer or other third party during
          the Consulting Period. Any such employment or service will be subject
          to the prior written approval of the Company. Tysoe further agrees
          that, upon request from the Company, he will, from the Separation Date
          until the Retirement Date, provide substantiation concerning any and
          all compensation arrangements from a subsequent employer or third
          party.
          
          
     iii. In connection with his termination of employment on the Retirement
          Date, Tysoe will follow the Company's standard procedures relating to
          departing employees, including, without limitation, returning (and
          providing confirmation that he has so returned) all Company owned
          property, documents and materials (including copies, reproductions,
          summaries and/or analyses), and all other materials that contain,
          reflect, summarize, describe, analyze or refer or relate to
          confidential information of the Company or Federated.
          

3.    No Solicitation. During the period commencing on the Effective Date and
continuing until June 30, 2009 (the "Non-Solicitation Period"), Tysoe agrees
that he will not actively, in personal conversations, by telephone, in writing
(including but not limited to via electronic communications), or by any other
medium, directly or indirectly through agents or representatives, without
written permission from the Company, solicit any person who is on the Effective
Date or at any time during the Non-Solicitation Period, employed by the Company,
or by its parents, divisions, subsidiaries or affiliated corporations, to
terminate their employment with the Company or any of its parents, divisions,
subsidiaries or affiliated corporations and commence employment at, or provide
services to, any other business enterprise.

4.    Release by Tysoe

.
 a. Tysoe for himself and his dependents, successors, assigns, heirs, executors
    and administrators (and his and their legal representatives of every kind),
    hereby releases, dismisses, and forever discharges the Company from, agrees
    not to sue or join in any suit against the Company for, and agrees to
    indemnify the Company against, any and all arbitrations, claims (including
    claims for attorney's fees), demands, damages, suits, proceedings, actions
    and/or causes of action of any kind and every description, whether known or
    unknown, which Tysoe now has or may have had for, upon, or by reason of any
    cause whatsoever (except that this release shall not apply to the
    obligations of the Company arising under this Agreement), against the
    Company ("Claims"), including but not limited to:
    
    
     i.   any and all Claims, directly or indirectly, arising out of or relating
          to: (A) Tysoe's employment with the Company; and (B) Tysoe's
          resignation as Vice Chair of Federated and any other position
          described in Paragraph 1 of this Agreement.
          
          
     ii.  any and all claims of discrimination, including but not limited to
          claims of discrimination on the basis of sex, race, age, national
          origin, marital status, religion or disability, including,
          specifically, but without limiting the generality of the foregoing,
          any claims under the Age Discrimination in Employment Act, as amended
          (the "ADEA"), Title VII of the Civil Rights Act of 1964, as amended,
          the Americans with Disabilities Act of 1990, the Family and Medical
          Leave Act of 1993 and Ohio Revised Code Chapter 4112;
          
          
     iii. any and all claims of wrongful or unjust discharge or breach of any
          contract or promise, express or implied; and
          
          
     iv.  any and all claims under or relating to any and all employee
          compensation, employee benefit, employee severance or employee
          incentive bonus plans and arrangements; provided that he shall remain
          entitled to the amounts and benefits specified in Paragraph 2 above.
          Tysoe agrees that he intends to release by this Agreement any and all
          worker compensation claims that he may have against the Company as of
          the date this Agreement is fully executed.
          
          

 b. Tysoe's release and covenant not to sue excludes claims that cannot be
    waived by law, including the right to file a charge with the Equal
    Employment Opportunity Commission; provided, however, that Tysoe
    specifically waives and releases the right to any monetary recovery or other
    relief from such a filing.
    
    
 c. Tysoe understands and acknowledges that the Company does not admit any
    violation of law, liability or invasion of any of his rights and that any
    such violation, liability or invasion is expressly denied. The consideration
    provided under this Agreement is made for the purpose of settling and
    extinguishing all claims and rights (and every other similar or dissimilar
    matter) that Tysoe ever had or now may have or ever will have against the
    Company to the extent provided in this Paragraph 4. Tysoe further agrees and
    acknowledges that no representations, promises or inducements have been made
    by the Company other than as appear in this Agreement.
    
    
 d. Tysoe further understands and acknowledges that:
    
    
     i.   The release provided for in this Paragraph 4, including claims under
          the ADEA to and including the date of this Agreement, is in exchange
          for the additional consideration provided for in this Agreement, to
          which consideration he was not heretofore entitled;
          
          
     ii.  He has been advised by the Company to consult with legal counsel prior
          to executing this Agreement and the release provided for in this
          Paragraph 4, has had an opportunity to consult with and to be advised
          by legal counsel of his choice, fully understands the terms of this
          Agreement, and enters into this Agreement freely, voluntarily and
          intending to be bound;
          
          
     iii. He has been given a period of twenty-one days to review and consider
          the terms of this Agreement, and the release contained herein, prior
          to its execution and that he may use as much of the twenty-one day
          period as he desires; and
          
          
     iv.  He may, within seven days after execution, revoke this Agreement.
          Revocation shall be made by delivering a written notice of revocation
          to the General Counsel at the Company. For such revocation to be
          effective, written notice must be actually received by the General
          Counsel at the Company no later than the close of business on the
          seventh day after Tysoe executes this Agreement. If Tysoe does
          exercise his right to revoke this Agreement, all of the terms and
          conditions of the Agreement shall be of no force and effect and the
          Company shall have no obligation to satisfy the terms or make any
          payment to Tysoe as set forth in Paragraph 2 of this Agreement.
          
          

 e. Tysoe will never file a lawsuit or other complaint asserting any claim that
    is released in this Paragraph 4. In the event Tysoe breaches this Paragraph
    4(e), he agrees to indemnify the Company against any costs or expenses,
    including attorney fees, that the Company may incur in connection with such
    breach.
    
    
 f. Tysoe and the Company acknowledge that his retirement is by mutual agreement
    between the Company and Tysoe, and that Tysoe waives and releases any claim
    that he has or may have to re-employment.
    
    
 g. For purposes of the above provisions of this Paragraph 4, the "Company"
    shall include the Company and Federated and their predecessors,
    subsidiaries, divisions, related or affiliated companies, officers,
    directors, stockholders, members, employees, heirs, successors, assigns,
    representatives, agents and counsel.

5.    Disclosure. From the date of this Agreement through the end of the
Consulting Period, Tysoe will communicate the contents of Paragraphs 2(n)(ii),
3, 6, and 8 of this Agreement to any person, firm, association, or corporation
other than the Company which he intends to be employed by or provide services
to.

6.    Continued Availability and Cooperation

.
 a. Tysoe hereby agrees to provide the Company with his cooperation and
    assistance, as reasonably requested by the Company, in regard to matters
    previously within the scope of his responsibility at the Company or about
    which he acquired knowledge while at the Company, including, without
    limitation, matters involving the sale of the Lord & Taylor and David's
    Bridal divisions.
    
    
 b. Tysoe shall cooperate fully with the Company and with the Company's counsel
    in connection with any present and future actual or threatened litigation or
    administrative proceeding involving the Company that relates to events,
    occurrences or conduct occurring (or claimed to have occurred) during the
    period of Tysoe's employment by the Company or until the Retirement Date.
    This cooperation by Tysoe shall include, but not be limited to:
    
    
     i.   making himself reasonably available for interviews and discussions
          with the Company's counsel as well as for depositions and trial
          testimony;
          
          
     ii.  if depositions or trial testimony are to occur, making himself
          reasonably available and cooperating in the preparation therefor as
          and to the extent that the Company or the Company's counsel reasonably
          requests;
          
          
     iii. refraining from impeding in any way the Company's prosecution or
          defense of such litigation or administrative proceeding; and
          
          
     iv.  cooperating fully in the development and presentation of the Company's
          prosecution or defense of such litigation or administrative
          proceeding.
          
          

 c. Except in connection with any investigation, civil or administrative
    proceeding or arbitration in which Tysoe has been named a defendant in his
    individual capacity, the Company shall reimburse Tysoe for reasonable
    travel, lodging, telephone and similar expenses incurred in connection with
    such cooperation, which the Company shall reasonably endeavor to schedule at
    times not conflicting with the reasonable requirements of any employer of
    Tysoe, or with the requirements of any third party with whom Tysoe has a
    business relationship permitted hereunder that provides remuneration to
    Tysoe. Tysoe shall not unreasonably withhold his availability for such
    cooperation.
    
    
 d. Upon the Retirement Date, Tysoe will update the Company as to the status of
    all pending matters for which he was responsible or otherwise involved with
    respect to the Company.
    
    
 e. The Company agrees to indemnify Tysoe against claims or actions, arising
    from or connected with his past activities as an employee of the Company in
    a manner consistent with the Company's By-laws and Delaware law.
    Notwithstanding the foregoing, the Company will have no obligation to
    release, indemnify, hold harmless or defend Tysoe for any conduct by Tysoe
    alleged to be intentional or willful or that arises from a violation of any
    statutory prohibition unless such conduct was specifically requested by the
    Company. Tysoe warrants that he has disclosed to the Company all claims and
    circumstances and potential claims and circumstances that may exist or could
    reasonably be brought against him concerning his past activities as an
    employee.

7.    Successors and Binding Agreement.
 a. This Agreement shall be binding upon and inure to the benefit of the Company
    and any successor of or to the Company, including, without limitation, any
    persons acquiring, directly or indirectly, all or substantially all of the
    business and/or assets of the Company whether by purchase, merger,
    consolidation, reorganization, or otherwise (and such successor shall
    thereafter be deemed included in the definition of "the Company" for
    purposes of this Agreement), but shall not otherwise be assignable or
    delegable by the Company.
    
    
 b. This Agreement shall inure to the benefit of and be enforceable by Tysoe's
    personal or legal representatives, executors, administrators, successors,
    heirs, distributees, and/or legatees.
    
    
 c. This Agreement is personal in nature and none of the parties hereto shall,
    without the consent of the other parties, assign, transfer or delegate this
    Agreement or any rights or obligations hereunder except as expressly
    provided in Subparagraphs (a) and (b) of this Paragraph 7.
    
    
 d. This Agreement is intended to be for the exclusive benefit of the parties
    hereto, and except as provided in Subparagraphs (a) and (b) of this
    Paragraph 7, no third party shall have any rights hereunder.

8.    Statements to Third Parties. Because the purpose of this Agreement is to
settle amicably any and all potential disputes or claims among the parties,
Tysoe shall not, directly or indirectly, make or cause to be made any statements
to any third parties criticizing or disparaging the Company or comment on its
character or business reputation. Tysoe further hereby agrees not: (a) to
comment to others concerning the status, plans or prospects of the business of
the Company, or (b) to engage in any act or omission that would be detrimental,
financially or otherwise, to the Company, or that would subject the Company to
public disrespect, scandal, or ridicule. For purposes of this Paragraph 8, the
"Company" shall mean the Company, Federated, and its directors, officers,
predecessors, parents, subsidiaries, divisions, and related or affiliated
companies. The Company agrees that its directors and executive officers shall
not, directly or indirectly, make or cause to be made any statements to any
third parties criticizing or disparaging Tysoe or comment on his character or
business reputation. The foregoing undertakings shall not apply to any
statements or opinions that are made under oath in any investigation, civil or
administrative proceeding or arbitration in which the individual has been
compelled to testify by subpoena or other judicial process or which are
privileged communications.

9.    Notices

. For all purposes of this Agreement, all communications provided for herein
shall be in writing and shall be deemed to have been duly given when delivered,
addressed to the Company at its principal executive offices (to the attention of
the General Counsel, with a copy to the Senior Vice President - Human Resources)
and to Tysoe at his principal residential address on file with the Company, or
to such other address as any party may have furnished to the other in writing
and in accordance herewith. Notices of change of address shall be effective only
upon receipt.

10.    Miscellaneous

. No provision of this Agreement may be modified, waived or discharged unless
such modification, waiver or discharge is agreed to in writing signed by Tysoe
and the Company. No waiver by either party hereto at any time of any breach by
the other party hereto or compliance with any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, expressed
or implied with respect to the subject matter hereof have been made by any of
the parties that are not set forth expressly in this Agreement and every one of
them (if, in fact, there have been any) is hereby terminated without liability
or any other legal effect whatsoever.

11.    Entire Agreement

. This Agreement shall constitute the entire agreement among the parties hereto
with respect to the subject matter hereof and, except to the extent otherwise
provided herein, shall supersede all prior verbal or written agreements,
covenants, communications, understandings, commitments, representations or
warranties, whether oral or written, by any party hereto or any of its
representatives pertaining to such subject matter.

12.    Governing Law

. Any dispute, controversy, or claim of whatever nature arising out of or
relating to this Agreement or breach thereof shall be governed by and under the
laws of the State of Ohio.

13.    Validity

. The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement, which shall nevertheless remain in full force and effect.

14.    Counterparts

. This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same Agreement.

15.    Captions and Paragraph Headings

. Captions and paragraph headings used herein are for convenience and are not
part of this Agreement and shall not be used in construing it.

16.    Further Assurances

. Each party hereto shall execute such additional documents, and do such
additional things, as may reasonably be requested by the other party to
effectuate the purposes and provisions of this Agreement. If so requested by the
Company, Tysoe agrees to execute an additional release of claims, upon terms
substantially similar to those contained in Paragraph 4 hereof, after the
Separation Date and/or the Retirement Date.

 

IN WITNESS WHEREOF

, the parties have executed and delivered this Agreement on October 3, 2006,
effective as of the date first set forth above.

> > > > FEDERATED CORPORATE SERVICES, INC.
> > > > 
> > > >  
> > > > 
> > > > By: /s/ Dennis J. Broderick
> > > > Name: Dennis J. Broderick
> > > > Title: President
> > > > 
> > > >  
> > > > 
> > > > > > /s/ Ronald W. Tysoe
> > > > > > Ronald W. Tysoe