Exhibit
10.85


 


RUSS
BERRIE AND COMPANY, INC.

STOCK OPTION AGREEMENT FOR NON-EMPLOYEE DIRECTORS


 


Date of
Grant:             
    , 200  


 


Russ Berrie and Company, Inc., a New Jersey
corporation (the “Company”), does hereby grant to                          
(the “Optionee”), as of the date set forth above, pursuant to the 2004 Russ
Berrie and Company, Inc. Stock Option, Restricted and Non-Restricted Stock Plan
(the “Plan”), a copy of which is appended hereto and incorporated herein by
reference, a stock option (the “Option”) to purchase an aggregate of           
shares of its Common Stock (stated value $.10) (the “Stock”) at the price of $          
per share, upon the following terms and conditions.  Capitalized terms used but undefined herein
shall have the meanings ascribed to them in the Plan.  This is the Option Agreement referred to in Section 5.11
of the Plan.


 


1.                                       (a)                                  This Option is intended to be a Non-Qualified
Stock Option.


 


(b)                                 Except
as provided in Section 2 below, this Option shall vest and become
exercisable ratably over five years (20% per year) from the Date of Grant,
provided that in no event may a vested portion of the Option be exercised later
than 10 years from the Date of the Grant.


 


(c)                                  The
Committee may, in its sole discretion, limit the number of shares of Stock that
the Optionee may purchase by the exercise of this Option on any particular date
or in any Plan Year.


 


2.                                      (a)                                   Subject to paragraph (b) below, if an Optionee
ceases to serve as a member of the Board for any reason, any non-vested portion
of the Option shall immediately terminate; any unexercised vested portion of
the Option shall be exercisable for 30 days after the applicable termination
date, or the stated term of the Option, whichever period is shorter.


 


(b)                                 In
the event of the death or Disability of Optionee while serving as a member of
the Board, any outstanding unexercised portion of the Option existing on the
date such service terminated, whether or not vested and/or exercisable on the
date such service was terminated, shall be deemed fully vested and exercisable,
and may be exercised by such Optionee’s estate, legatee(s), legal
representative or permitted transferee(s) for up to one year after such
Optionee’s death or final determination of Disability, as applicable, or the
stated term of the Option, whichever period is shorter.


 


3.                                       This Option shall be exercised by giving written
notice of exercise to the Company at 111 Bauer Drive, Oakland, NJ  07430 (Attention: Chief Financial Officer)
which shall specify the number of shares of Stock to be purchased and which
shall be accompanied by payment in full of the purchase price in cash.


 


4.                                       The number of shares of Stock subject to this
Option and the price to be paid therefor, shall be subject to adjustment as
follows:


 





















 


(a)                                  In
the event of any change in the outstanding Stock by reason of a dissolution or
liquidation of the Company, sale of all or substantially all of the assets of
the Company, merger or consolidation of the Company with or into any other
corporation if the Company is the surviving corporation, statutory share
exchange involving capital stock of the Company, reorganization,
recapitalization, reclassification, stock dividend, extraordinary dividend,
stock split, reverse stock split, stock combination, rights offering, spin-off
or other relevant change, the Committee may adjust the aggregate number of
shares of Stock available for awards of options under the Plan, the Option
price of Options granted under the Plan, and any or all other matters deemed
appropriate by the Committee, including, without limitation, accelerating the
vesting and/or exercise period pertaining to any award of Options under the
Plan.


 


(b)                                 In
connection with a Business Combination, the Committee, in its sole discretion,
may provide for (i) the continuation of the Plan and/or the assumption of the
awards granted thereunder by a successor corporation (or a parent or subsidiary
thereof), (ii) the substitution for such awards of new awards covering the
stock of a successor corporation (or a parent or subsidiary thereof), with
appropriate adjustments as to the number and kind of shares and exercise
prices, (iii) upon 10 days’ advance notice from the Committee to the Optionee,
the acceleration of the vesting and/or exercise period pertaining to the Option
or (iv) upon 10 days’ advance notice from the Committee to the Optionee, (x)
the cancellation of any outstanding portion of this Option that is then
exercisable and the payment to the holder thereof, in cash or stock, or any
combination thereof, of the value of such portion based upon the price per
share of Stock received or to be received by other stockholders of the Company
in connection with the Business Combination, and (y) the cancellation of the
portion of the Option that is not then exercisable.  In the event of any continuation, assumption
or substitution contemplated by the foregoing clauses, the Option shall
continue in the manner and under the terms so provided.


 


(c)                                  If,
by reason of a change in capitalization described above, Optionee shall be
entitled to new, additional or different shares of stock or securities of the
Company or any other corporation in respect of his or her Option, in the event
that the Plan continues, such new, additional or different shares shall
thereupon be subject to all of the conditions, restrictions and performance
criteria which were applicable to the shares of Stock subject to the Option
prior to such change in capitalization.


 


5.                                       This Option shall not be assignable or
transferable except by will or by the laws of descent or distribution provided,
however, that each Optionee may transfer all or any portion of his/her
Non-Qualified Stock Options to a member of his/her Immediate Family, a trust
for the benefit of the Optionee or any member of his or her Immediate Family,
partnerships in which the Optionee or his/her Immediate Family members and/or
trusts are the only partners, and/or any organization exempt under Section 501(c)
of the Internal Revenue Code of 1986, as amended (the “Code”).  Subject to the provisions of


 


2





















 


Section 2,
this Option shall be exercisable only by the Optionee or his or her permitted
assignee or transferee.


 


6.                                       Subject to the limitations set forth in the Plan,
the Committee is vested with absolute discretion and authority to interpret the
Plan and make all determinations necessary or advisable for the administration
thereof.  Any determination of the
Committee in the administration of the Plan, as described therein, shall be
final, conclusive and binding upon the Optionee and any person claiming under
or through the Optionee, including, without limitation, as to any adjustments
pursuant to Section 4 hereof.


 


7.                                       If a Participating Company is for any reason
required to withhold any amount under the laws and regulations of the United
States, any jurisdiction thereof or local government with respect to the
transfer of Stock upon exercise of the Option (“Withholding Taxes”), the
Optionee or other person receiving such Stock shall be required to pay such
Participating Company the amount of any such Withholding Taxes.  The applicable Participating Company shall
have the right to require the payment of any such Withholding Taxes before
issuing any Stock hereunder.  In lieu of
all or any part of a cash payment regarding such Withholding Taxes, the
Committee may permit a person to cover all or any part of the Withholding
Taxes, through a reduction in the number of shares of Stock delivered to such
person or a delivery or tender to the Company of shares of Stock held by such
person, in each case valued in the same manner as used in computing the
Withholding Taxes under applicable laws.


 


8.                                       The Company shall not be required to issue or
deliver a certificate for shares of Stock hereunder unless the issuance of such
certificate complies with all applicable legal requirements including, without
limitation, compliance with the provisions of applicable state securities laws,
the Securities Act of 1933, as amended (the “Securities Act”), the Securities
Exchange Act of 1934, as amended, and the requirements of the exchanges, if
any, on which the Company’s shares of Common Stock may, at that time, be
listed.


 


9.                                       Notwithstanding anything contained in the Plan or
herein to the contrary, in the event that the disposition of shares of Stock
acquired pursuant to the Plan is not covered by a then current registration
statement under the Securities Act, and is not otherwise exempt from such
registration, such shares shall be restricted against transfer to the extent
required by the Securities Act and Rule 144 or other regulations
thereunder.  The certificates evidencing
any of such shares shall be appropriately amended or have an appropriate legend
placed thereon to reflect their status as restricted securities as aforesaid.


 


10.                                 To the extent that federal laws of the United
States do not otherwise control, this Agreement shall be governed by the laws
of New Jersey, without giving effect to principles of conflicts of laws, and
shall be construed accordingly.


 


11.                                 In the event any provision of this Agreement shall
be held illegal or invalid for any reason, the illegality or invalidity shall
not affect the remaining parts of this Agreement, and this Agreement shall be
construed and enforced as if the illegal or invalid provision had not been
included.


 


3





















 


12.                                 This Agreement shall be binding upon and inure to
the benefit of the successors (including by way of merger), assigns and heirs
of the respective parties.


 


13.                                 The Optionee shall not be, nor have any of the
rights or privileges of, a stockholder of the Company in respect of any shares
of Stock purchasable upon exercise of the Option granted hereunder unless and
until certificates representing such shares shall have been issued by the
Company.


 


14.                                 The Optionee
acknowledges and agrees that a violation of Section 5 of this Agreement
will cause the Company irreparable injury for which adequate remedy at law is
not available.  Accordingly, the Optionee
agrees that the Company shall be entitled to an injunction, restraining order
or other equitable relief, without the posting of any bond, to prevent the
breach of such Section and to enforce the terms and provisions hereof in
any court of competent jurisdiction in the United States or any state thereof,
in addition to any other remedy to which it may be entitled at law or equity.


 


	
   

  	
  RUSS BERRIE AND
  COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  AGREED TO AND ACCEPTED AS OF THE

  DATE OF GRANT SET FORTH ABOVE:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNATURE-OPTIONEE

  	
   

  
					



 


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