Document:

<PAGE>
                                                                   EXHIBIT 10.58

                                                                 August 14, 2000
Ms. Dona Fisher
5613 Eagle Point
El Paso, TX 79912

Dear Dona:

     I am pleased to offer you the position of Vice President and Chief
Operating Officer of Russ Berrie and Company, Inc. effective September 5, 2000.

     Your employment with the Company will include the following:

     1.   COMPENSATION. Your base salary will be at an annual rate of $250,000.
          You will be eligible for the Executive Incentive Program ("EIP") bonus
          program beginning with the year 2001 (generally paid in February of
          the following year). The EIP is equal to 50% of your base salary.
          Generally, the full 50% bonus vests over a period of three years. This
          three-year vesting period is waived for you. The bonus program is
          predicated on meeting the Company's minimum operating profit for the
          applicable year.

     2.   GROUP HEALTH AND DISABILITY. After 90 days of continuous employment,
          you will be eligible to participate in:

          a.   Our contributory Group Health Plan.

          b.   Our non-contributory Life Insurance Plan in the amount one times
               your base salary.

          c.   Our non-contributory Long Term Disability.

     3.   DENTAL. After twelve months of employment, you will be eligible to
          participate in our contributory Dental Insurance Plan.

     4.   STOCK OPTIONS. Stock options are granted to eligible employees at the
          beginning of each calendar year. You will be eligible to participate
          in the Company's

          Stock Option Plan based on its current provisions. You will receive
          stock options equal to 40% of your base salary. Under the provisions
          of the stock option plan, you must have 18 months of service prior to
          the first grant. However, this can be waived and, in your case, would
          be. Therefore, you will receive your first grant at the beginning of
          2001.

     5.   401(k). After six months of employment, you will be eligible to
          participate in the Company's 401(k) plan based on its current
          provisions. The Company's

                                       1
<PAGE>

          contribution to your 401(k) account fully vests over a period of four
          years of employment.

     6.   VACATION. Between your date of hire and the end of the year 2000, you
          will be entitled to take 4 Fridays of vacation days - 1 in September,
          1 in October, 1 in November (the Friday after Thanksgiving Day) and 1
          in December (after December 18). In the year 2001, you will be
          eligible for three weeks vacation.

     7.   HOLIDAY/SICK. You will be eligible for paid holidays and sick time in
          accordance with Company policy.

     8.   COMPANY CAR. You will receive an allowance of up to $28,000 to
          purchase an automobile in the Company's name. This allowance is paid
          every three years toward an automobile. Certain expenses, such as
          gasoline, repairs and insurance, will be provided by the Company.

     9.   RELOCATION. The Company's relocation policy pays up to $27,500 of your
          documented relocation expenses. To the extent that you incur
          relocation expenses in excess of the $27,500 limit, the Company will
          advance to you, interest free, a loan against your EIP bonus to cover
          such additional expenses. In addition, the Company will pay the cost
          of moving your household goods (in accordance with policy).

     10.  REPORTING RELATIONSHIPS. The following departments will report to you:
          Finance, MIS/IT, Administration, Global Logistics, Internal Audit,
          Human Resources and Legal.

     The Company reserves the right to change or modify these programs. In
addition, employment with the Company is considered "at-will" and does not
represent a specific guarantee.

     Dona, I want to welcome you to Russ Berrie and Company, Inc. and wish you
much success in your new position.

                                Very truly yours,

                                /s/ Russ Berrie
                                ------------------------------
                                Russ Berrie
                                Chairman

cc:  B. Sottile
     E. Goldenberg

AGREED TO AND ACCEPTED BY:

/s/ Dona Fisher
-----------------------
(Dona Fisher)

August 18, 2000

                                       2<PAGE>
                                                                   EXHIBIT 10.59

                               SEVERANCE AGREEMENT

In the event that Dona Fisher is terminated from Russ Berrie and Company, Inc.
(the "Company"), for reason other than cause or other than her own voluntary
resignation, she will receive 6 months severance pay at the rate that she is
being paid on her termination date. This severance will be paid to her over six
months on the Company's normal pay schedule. During this period, she will also
be entitled to remain on the Company's health and dental insurance plan (making
the same payroll contribution as when she was an active employee). Further, if
she obtains gainful employment during this six-month severance period (with
employment being defined as full-time salaried work, excluding any low-level
employment such as in a health club), her severance payments will be terminated,
effective the date she starts her new employment.

                                                   RUSS BERRIE AND COMPANY, INC.

                                                   /s/ Russ Berrie
                                                   -----------------
                                                   Russ Berrie
                                                   Chairman and CEO
                                                   December 18, 2000

ACCEPTED AND AGREED:

/s/ Dona Fisher
-----------------
(Dona Fisher)
December 18, 2000<PAGE>
                                                                   EXHIBIT 10.60

                                  [RUSS LOGO]

                          RUSS BERRIE AND COMPANY, INC.

                      EXECUTIVE DEFERRED COMPENSATION PLAN

                                  2001 Overview

                                   prepared by

                              [MCG NORTHWEST LOGO]

<PAGE>

TABLE OF
CONTENTS

                                                                      PAGE
                                                                      ----
INTRODUCTION

THE EXECUTIVE DEFERRED COMPENSATION PLAN

Eligibility ..........................................................  1
Deferrals ............................................................  1
Benefits .............................................................  1
Security .............................................................  1

DEFERRAL ADVANTAGES

UNDER THIS PLAN

Reduced Taxable Income ...............................................  2
More Investment Dollars ..............................................  2
Pretax Investment Growth .............................................  2
Assumptions ..........................................................  2
Example ..............................................................  3

HOW THE PLAN WORKS

ELECTION TO DEFER

Deferrals ............................................................  4
Deferral Period ......................................................  4
Minimums and Maximums ................................................  4
Enrollment ...........................................................  4
Hardship Waiver ......................................................  4
Account Selection ....................................................  4
Your Account .........................................................  5
Crediting Deferrals ..................................................  5
Earnings Indexes .....................................................  5
Investment Risk ......................................................  6
Earnings Indexes Investment Objectives ...............................  6
Changing Indexes .....................................................  8
401(k) Makeup Match ..................................................  8
Other Risk/Unsecured Creditor ........................................  8
FICA Tax .............................................................  8

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    i
<PAGE>

TABLE OF
CONTENTS

                                                                        PAGE
                                                                        ----

DISTRIBUTIONS

PAYABLE EVENTS .......................................................    9

ELECTING DISTRIBUTION TIME AND FORM

Distribution Election Requirement ....................................   10

RETIREMENT

Payout Options .......................................................   10
Commencement Option ..................................................   10

TERMINATION ..........................................................   11

SCHEDULED IN-SERVICE WITHDRAWAL

Preselected Date .....................................................   11
Example ..............................................................   11
Payout ...............................................................   11
No Penalty ...........................................................   11
Additional Contributions .............................................   11

HARDSHIP WITHDRAWAL ..................................................   12

ACCELERATED DISTRIBUTION

Insolvency/Bankruptcy ................................................   12
Request for Distribution .............................................   12
Withdrawal Penalty ...................................................   12
Suspension From Plan .................................................   13
Preference Period ....................................................   13
Example ..............................................................   13

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    ii
<PAGE>

TABLE OF
CONTENTS

                                                                        PAGE
                                                                        ----
DEATH

Preretirement ........................................................   14
Postretirement .......................................................   14
Your Beneficiary .....................................................   14
Beneficiary Changes ..................................................   14

DISABILITY ...........................................................   14

PARTICIPANT SECURITY

RABBI TRUST

Unsecured General Creditor ...........................................   15
Protects From: Change of Heart,
   Change in Control .................................................   15
Trust Assets .........................................................   15
Independent Trustee ..................................................   15

CHANGE IN CONTROL ....................................................   16

OTHER INFORMATION

Plan Document Governs ................................................   17
Not an Employment Contract ...........................................   17
Right to Amend .......................................................   17
Nonqualified Unfunded Plan Under ERISA ...............................   17
Consult Your Tax Advisor .............................................   17

QUESTIONS AND ANSWERS

Taxation .............................................................   18
Distribution .........................................................   19
Security .............................................................   20
Impact on Other Plans ................................................   21
Administration .......................................................   21

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001   iii
<PAGE>

INTRODUCTION

The Executive Deferred Compensation Plan is designed to provide an opportunity
for selected employees and directors to defer income and have it accumulate on a
tax-deferred basis.

THE EXECUTIVE DEFERRED COMPENSATION PLAN

ELIGIBILITY

o    Employees with total compensation in excess of $100,000, excluding stock
     incentive plans, travel and entertainment allowances, and relocation
     reimbursements. Sales people earning commissions (whose base salary is less
     than $100,000) may qualify under a look-back rule.

o    Members of the Board of Directors.

DEFERRALS

Provides an opportunity to defer directors' fees and employees'
salaries, commissions and bonuses.

BENEFITS

Enables tax planning and financial independence. With a pretax yield and tax
deferral, the funds you defer will accumulate more quickly, supplementing your
retirement and survivor income. In addition, the Plan provides a preretirement
death benefit enhancement equal to 10 times your average deferral over the last
four years with a maximum of $250,000.

SECURITY

Enhanced security through a funded rabbi trust and a call provision.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     1

<PAGE>

DEFERRAL
ADVANTAGES

UNDER THIS PLAN

REDUCED TAXABLE INCOME

Your current taxable income is reduced by the amount you elect to defer.

MORE

INVESTMENT DOLLARS

You can invest more than you can in most outside investments because the
deferral is made from pretax income.

PRETAX INVESTMENT GROWTH

Pretax investment, tax-deferred accumulation, and market-based investment
results provide potentially greater effective returns than if you invested
taxable compensation in an outside plan.

[GRAPH]

<TABLE>
<S>                                                           <C>
ASSUMPTIONS
         One-Time Deferral                                    $10,000
         Pretax Investment                                    $10,000
         Plan Tax Bracket                                         40%
         Outside Investment Tax Bracket                           40%
         Outside Investments                                       9%
         Russ Berrie and Company, Inc. Plan                        9%

</TABLE>
                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     2

DEFERRAL
ADVANTAGES

UNDER THIS PLAN (CONTINUED)

EXAMPLE         For each $1 of compensation:

[BAR GRAPH]

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     3

<PAGE>

HOW THE PLAN
WORKS

ELECTION TO DEFER

DEFERRALS

You may elect each year to defer receipt of a portion of your compensation. All
deferrals are pretax; therefore your current income tax is reduced.

DEFERRAL PERIOD

A new deferral period begins each calendar year. Before the end of each year,
you will have the opportunity to make a new deferral election for the following
year.

MINIMUMS AND MAXIMUMS

The MINIMUM deferral amount is $2,000 annually. The MAXIMUM deferrals are:
<TABLE>
<CAPTION>

                                                                  MAXIMUM
                                   COMPENSATION                   DEFERRAL
                                   ---------------------------------------
                                   <S>                               <C>
                                   Base Salary                        90%*
                                   Commission                        100%*
                                   Bonuses                           100%*
                                   Directors' Fees                   100%
                                   =======================================
</TABLE>

ENROLLMENT

Your election must be made by December 22, 2000.

HARDSHIP WAIVER

The Administrative Committee may waive or modify the remainder of any deferral
commitment upon evidence of severe financial hardship.

ACCOUNT SELECTION

When you make your deferral election you will also need to elect what percentage
of your deferral you want to allocate to your Retirement Account and what
percentage to your In-Service Withdrawal Account.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     4
<PAGE>

HOW THE PLAN
WORKS

ELECTION TO DEFER (CONTINUED)

YOUR ACCOUNT

The Company credits an "Account" in your name, with your deferral.

CREDITING DEFERRALS

Your Account is credited each pay date with your defer- rals. Deferrals will be
credited with rates of return which can be positive or negative based on the
investment index allocation you elected.

EARNINGS INDEXES

Your Account will be credited with earnings which mirror the investment results
of the indexes you select. The indexes are:

o    Prudential Money Market Portfolio

o    SP PIMCO Total Return Portfolio

o    MFS Emerging Growth Series Portfolio

o    Janus Aspen Series Aggressive Growth Portfolio

o    AIM V.I. Value Fund

o    Franklin Small Cap Fund

o    Janus Aspen Series Balanced Portfolio

o    Janus Aspen Series International Growth Portfolio

You may choose any combination of portfolios. Your allocation must be stated in
whole percentages.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     5
<PAGE>

HOW THE PLAN
WORKS

ELECTION TO DEFER (CONTINUED)

INVESTMENT RISK

Your Account is subject to investment risk. As in any investment, if there is a
positive return, the account balance will grow; if there is a negative return,
the account balance will be reduced. The specific funds are described in the
prospectus, which you need to review prior to making your election. YOU SHOULD
CAREFULLY REVIEW THE FUND DESCRIPTIONS.

EARNINGS INDEXES INVESTMENT OBJECTIVES

PRUDENTIAL MONEY MARKET PORTFOLIO: Maximum current income, stability of capital
and maintenance of liquidity through investment in high quality short-term debt
instruments.

SP PIMCO TOTAL RETURN PORTFOLIO: This portfolio seeks to maximize current income
and price appreciation, consistent with preservation of capital and prudent
risk-taking, by investing primarily in investment-grade debt securities,
including those of non-U.S. issuers.

MFS EMERGING GROWTH SERIES PORTFOLIO: Seeks long-term growth of capital.
Dividend and interest income from portfolio securities, if any, is incidental to
the Series' investment objective of long-term growth of capital.

JANUS ASPEN SERIES AGGRESSIVE GROWTH PORTFOLIO: Seeks long-term growth of
capital.

AIM V.I. VALUE FUND: A diversified portfolio that seeks to achieve long-term
growth of capital by investing primarily in equity securities judged by AIM to
be undervalued relative to the current or projected earnings of the companies
issuing the securities, or relative to current market values of assets owned by
the companies issuing the securities, or relative to the equity markets
generally.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     6
<PAGE>

HOW THE PLAN
WORKS

ELECTION TO DEFER (CONTINUED)

EARNINGS INDEXES INVESTMENT
OBJECTIVES (CONT.)

FRANKLIN SMALL CAP FUND: Seeks long-term capital growth.

JANUS ASPEN SERIES BALANCED PORTFOLIO: Seeks long-term capital growth,
consistent with preservation of capital and balanced by current income.

JANUS ASPEN SERIES INTERNATIONAL GROWTH PORTFOLIO: Seeks long-term growth of
capital.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     7
<PAGE>

HOW THE PLAN
WORKS

CHANGING INDEXES

Your investment allocation may be changed monthly, effective on the first day of
the month. This includes the opportunity to change the investment of existing
account balances. In order for new elections to become effective, a written
notice must be filed at least 10 days before the first day of the month. If no
new election is filed, your investment allocation will remain as last elected.

401(k) MAKEUP MATCH

If as a result of participating in this Plan your Company's 401(k) match is
reduced, the Company will credit to this Plan any lost match.

OTHER RISK/UNSECURED

You will be at all times an unsecured general creditor of CREDITOR Russ Berrie
and Company, Inc. You will have no ownership interest in the life insurance
indexing your investment.

FICA TAX

For employees, FICA tax will be applied to your gross income prior to the
deduction of your deferrals.

For directors, self-employment taxes will be payable upon distribution of
benefits.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     8
<PAGE>

DISTRIBUTIONS

PAYABLE EVENTS

Your benefits are payable under the following circumstances:

o    Retirement

o    Termination

o    In-Service Withdrawal

o    Hardship Withdrawal

o    Accelerated Distribution

o    Death

Special rules apply to each.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001     9
<PAGE>

DISTRIBUTIONS

ELECTING DISTRIBUTION TIME AND FORM

DISTRIBUTION ELECTION
REQUIREMENT

ELECTING DISTRIBUTION TIME AND FORM

You select the time and form of distribution when you complete your
Participation Agreement each year. This election may be changed prior to 13
months before you terminate employment.

RETIREMENT

Retirement for purposes of the Executive Deferred Com- pensation Plan is defined
as termination after change in control or age 50.

PAYOUT OPTIONS

o    Lump sum

o    2-15 annual installments, or

o    A combination of the above

COMMENCEMENT OPTION

You may elect to commence your benefit within 90 days of your retirement or
January following your retirement.

If your Account is less than $10,000, your benefit will be paid in a lump sum.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    10
<PAGE>

DISTRIBUTIONS

TERMINATION

If you terminate prior to being eligible for retirement, your Account will be
paid in a lump sum.

SCHEDULED IN-SERVICE WITHDRAWAL

PRESELECTED DATE

Payment commences on the date you selected when you made your deferral election.
That date cannot be earlier than five years after your deferral election.

EXAMPLE

[Graph]

PAYOUT

You may elect to have your Account paid in one to five annual installments.

NO PENALTY

In-Service Withdrawals are not subject to any penalty.

ADDITIONAL CONTRIBUTIONS

Each year you may add to your In-Service Withdrawal Account. The
Account, along with all annual additions, will be distributed on the date you
select.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    11
<PAGE>

DISTRIBUTIONS

HARDSHIP WITHDRAWAL

The deferral commitment is irrevocable. However, the Committee may waive or
modify the remainder of any deferral commitment if you have a Hardship
Withdrawal. If payment is made due to a Hardship Withdrawal, deferrals shall
cease for the remainder of the calendar year and for the entire year after that.

ACCELERATED DISTRIBUTION

INSOLVENCY/BANKRUPTCY

The Accelerated Distribution provision option provides a method to get 90% of
your Account balance if you become concerned about the Company's solvency.

In the case of either insolvency or bankruptcy, the assets in the trust will be
subject to disposition by the Federal Bankruptcy Court. This limitation on your
security is necessary to avoid taxation of your benefits before receipt.

REQUEST FOR DISTRIBUTION

You may request an Accelerated Distribution of your Account balance at any time.

WITHDRAWAL PENALTY

If you request a distribution, the Account balance distributed to you will be
reduced by 10%. By including this forfeiture in the Accelerated Distribution
provision, there should be no constructive receipt, i.e., the value of your
account should not be taxed to you before you receive it.

Your Account will be valued as of the last day of the month immediately
preceding the date on which the request is received by the Committee and paid to
you in a lump sum within 30 days.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    12
<PAGE>

DISTRIBUTIONS

ACCELERATED DISTRIBUTION (CONTINUED)

SUSPENSION FROM PLAN

You will not be allowed to participate in the Plan for 12 calendar months once
this provision has been exercised.

PREFERENCE PERIOD

The Accelerated Distribution provision will not be effective if exercised within
the preference period before bankruptcy. This preference period is 90 days in
most cases, but is one year for participants deemed "insiders."

EXAMPLE
<TABLE>

                          <S>                                                         <C>
                          Amount of Lump-Sum Deferral..................................  $ 50,000

                          Account Balance 10 Years Later at Time of Request for
                          Distribution............................                        118,368 *

                          10% Penalty..................................................  - 11,837
                                                                                         --------

                          NET LUMP-SUM DISTRIBUTION ...................................  $106,531

                          Effective Crediting Rate for Period .........................     7.86%
</TABLE>

                          *ASSUMING 9% EARNINGS RATE.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    13
<PAGE>

DISTRIBUTIONS

DEATH

PRERETIREMENT

If you die while employed or a Director of Russ Berrie and Company, Inc., this
Plan provides an Enhanced Death Benefit* equal to your Account balance PLUS 10
times your average Deferral Commitment for the last four years, up to a maximum
of $250,000. This Enhanced Death benefit and your Account balance will be paid
as you elect.

POSTRETIREMENT

If you die after you retire, your benefit will be your remaining Account balance
which will continue to be paid as you originally elected.

YOUR BENEFICIARY

The benefit is payable to the beneficiary you named on the Beneficiary
Designation form.

BENEFICIARY CHANGES

You may change your beneficiary designation at any time by contacting the
Committee and completing a new Beneficiary Designation form.

DISABILITY

If you terminate as a result of a Total Disability, your benefit will be
distributed as you elected.

*PLEASE NOTE, THE ENHANCED DEATH BENEFIT IS NOT PAYABLE IF YOU DIE WITHIN 24
MONTHS AFTER YOUR DEFERRALS COMMENCE AS A RESULT OF SUICIDE OR YOU PROVIDE FALSE
INFORMATION ON YOUR CONSENT TO INSURE.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    14

<PAGE>

PARTICIPANT
SECURITY

RABBI TRUST

UNSECURED GENERAL CREDITOR

Your deferral account is subject to the claims of general creditors of Russ
Berrie and Company, Inc. in the event of bankruptcy or insolvency.

PROTECTS FROM:
   CHANGE OF HEART
   CHANGE IN CONTROL

To increase the security of your benefits, Russ Berrie and Company, Inc. has
established a specially designed irrevocable trust, commonly called a rabbi
trust. The Trust protects you from a change in Russ Berrie and Company, Inc.'s
intentions to pay your benefits and from a change in control.

TRUST ASSETS

Assets held by the Trust are variable life insurance contracts. Since the cash
value of life insurance is not taxable, this enables Russ Berrie and Company,
Inc. to give you a better crediting rate on your account.

These assets are available to pay benefits to participants if Russ Berrie and
Company, Inc. refuses or is unable to pay benefits for any reason other than
bankruptcy or insolvency (i.e., change of heart or change of control).

The insurance proceeds are payable to the Trust. Except in the case of
insolvency, the assets can only be used to pay benefits. The participants have
no right to either the policies or policy proceeds.

INDEPENDENT TRUSTEE

The trustee is an independent third party.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    15
<PAGE>

PARTICIPANT
SECURITY

CHANGE IN CONTROL

If you terminate after a change in control your benefit will be paid as if you
had retired. The Company may not change the way they calculate the rates of
return on your Account.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    16

<PAGE>

OTHER
INFORMATION

PLAN DOCUMENT GOVERNS

This booklet has been prepared to give you a better understanding of the
benefits and features of this Plan. Each participant's benefits and rights under
this Plan are at all times governed by the text of the Executive Deferred
Compensation Plan document and are in no way altered or modified by the contents
of this booklet.

NOT AN EMPLOYMENT CONTRACT

This Plan does not constitute a contract of employment between you and Russ
Berrie and Company, Inc.

RIGHT TO AMEND

Russ Berrie and Company, Inc. reserves the right to amend or terminate this
Plan, in whole or in part, at any time. Such amendment or termination may not
alter the amounts already credited to your Account balance. Distributions will
occur according to the Plan document.

NONQUALIFIED UNFUNDED PLAN
UNDER ERISA

The Plan is a nonqualified, unfunded deferred compensation plan as defined under
the Internal Revenue Code and the Employee Retirement Income Security Act of
1974.

CONSULT YOUR TAX ADVISOR

You should consult a personal tax advisor for detailed information and guidance.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    17

<PAGE>

QUESTIONS AND
ANSWERS

TAXATION

NOTE: THE FOLLOWING IS NOT INTENDED TO BE TAX ADVICE. IF ANY SPECIFIC TAX
QUESTION ARISES, YOU SHOULD SEEK THE ADVICE OF YOUR TAX ADVISOR.

AM I TAXED ON DEFERRED COMPENSATION OR EARNINGS BEFORE I RECEIVE THEM?

No. As long as your deferral election is filed before you earn compensation that
you defer, you will not be deemed to be in constructive receipt of the amount
deferred or the earnings on the amount deferred. You will not be taxed until you
actually receive this money.

HOW DO MY DEFERRALS AFFECT THE WITHHOLDING ON MY PAYCHECKS?

For employees, your federal W-2 earnings exclude deferred compensation. Most
state and local laws also exclude deferred compensation from earnings. Thus,
taxes withheld will be reduced.

For directors, your deferrals will be excluded from your 1099.

IS MY DEFERRAL INCLUDED IN THE SOCIAL SECURITY WAGE BASE?

For employees, yes. Deferrals are subject to withholding for FICA and Medicare
taxes in the year of deferral until the annual FICA taxable wage base under the
Social Security provision is reached; however, there is no limitation on the
Medicare tax.

WILL I PAY SOCIAL SECURITY TAXES WHEN I TAKE MY DISTRIBUTION?

For employees, no. Because the deferrals were included in the wage base at the
time of deferral, the amounts are not subject to Social Security taxes when
paid.

HOW WILL DEFERRALS AFFECT DIRECTOR'S SELF-EMPLOYMENT TAXES?

Directors are not subject to self-employment taxes until they actually receive
their benefits.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    18
<PAGE>

QUESTIONS AND
ANSWERS

TAXATION (CONTINUED)

WILL THE PAYOUT AFFECT MY SOCIAL SECURITY BENEFITS AFTER I RETIRE?

For both directors and employees, no. Payments made from the deferral plan will
not affect your Social Security benefit. For purposes of Social Security, these
payments are considered "earned" when they are credited to your account. They do
not constitute earned income under the earnings test when they are distributed
to you.

HOW ARE MY DEFERRED AMOUNTS PLUS EARNINGS TAXED WHEN THEY ARE DISTRIBUTED TO ME?

They are taxed as ordinary income when distributed to you and are subject to
income tax withholding. Special income tax averaging is not available.

IS THE DEATH BENEFIT PAYABLE UNDER THE PLAN TAXABLE INCOME TO MY BENEFICIARY?

Yes. The death benefit (account balance plus enhanced death benefit, if
applicable) payable to your beneficiary is taxable as income.

WILL THE DEATH BENEFITS PAID TO MY BENEFICIARIES BE INCLUDIBLE IN MY GROSS
ESTATE FOR FEDERAL ESTATE TAX PURPOSES?

Yes. The account balance (plus enhanced death benefit, if applicable) at the
time of your death is includible in your gross estate. If, however, your
beneficiary is your spouse and the benefit qualifies for the estate tax marital
deduction, there will be no federal estate tax.

DISTRIBUTION

CAN I WITHDRAW MY ACCOUNT BEFORE I LEAVE THE EMPLOYMENT OF RUSS BERRIE AND
COMPANY, INC.?

Yes. You may either request a Hardship Withdrawal distribution, elect an
In-Service Withdrawal at the time of deferral or exercise the Accelerated
Distribution provision.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    19
<PAGE>

QUESTIONS AND ANSWERS

DISTRIBUTION (CONTINUED)

WHAT IS A HARDSHIP WITHDRAWAL?

A Hardship Withdrawal is a serious financial setback that is unanticipated and
beyond your control. For purposes of this Plan, the education of a child or the
purchase of a home will NOT constitute a Hardship Withdrawal.

WHY MUST I ELECT A SCHEDULED IN-SERVICE WITHDRAWAL AT LEAST FIVE YEARS BEFORE I
RECEIVE IT?

To avoid the adverse tax consequences of constructive receipt (i.e. taxation of
your benefit before receipt), the Plan must impose a restriction on Scheduled
In-Service Withdrawals.

WHY IS THERE A PENALTY FOR EXERCISING THE ACCELERATED DISTRIBUTION PROVISION?

Ordinarily, the unrestricted right to withdraw your deferral account would
create taxable income to you currently, even if you do not elect a withdrawal.
This penalty is designed to prevent your being taxed on the value of your
account before you actually receive it.

SECURITY

WHAT HAPPENS TO MY DEFERRALS IF RUSS BERRIE AND COMPANY INC. BECOMES INSOLVENT?

In the unlikely event that Russ Berrie and Company, Inc. , becomes insolvent,
you will be an unsecured general creditor of Russ Berrie and Company, Inc. Your
claim against the assets of Russ Berrie and Company, Inc. will be considered
with the claims of other general creditors in the event of bankruptcy.

The Accelerated Distribution provision affords you some protection by giving you
the opportunity to withdraw your funds net of a 10% penalty if you feel there is
a threat to Russ Berrie and Company, Inc.'s solvency, subject to preference
period rules.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    20
<PAGE>

QUESTIONS AND ANSWERS

IMPACT ON OTHER PLANS

CAN ANY OF THE PAYMENTS UNDER THIS PLAN BE "ROLLED OVER" INTO A QUALIFIED PLAN
OR IRA?

No. Amounts deferred are not eligible to be "rolled over" into a qualified plan
or IRA. Deferral plan distributions are subject to income tax as soon as the
amounts are actually or constructively received. Once you have the right to
receive the funds, there is no vehicle available to allow you to further shelter
these amounts from taxation.

SHOULD I STOP OR REDUCE MY 401(k) DEFERRALS IN ORDER TO DEFER INTO THIS PLAN?

Your deferrals into this Plan can be in addition to the 401(K) maximum amount
you can defer into the 401(k). Please consult your financial advisor regarding
your decision.

ADMINISTRATION

HOW CAN I FIND OUT THE STATUS OF MY ACCOUNT AND ITS BALANCE?

You will receive statements showing the status of your account each quarter
within 60 days following the end of the quarter.

WHEN WILL I RECEIVE MY ELECTION FORMS?

Election forms will be distributed during the annual open enrollment period each
year in which you are eligible to participate in this Plan. The forms must be
returned by the close of open enrollment for deferrals to be made in the
following calendar year.

                               -------------------------------------------------
                               RUSS BERRIE AND COMPANY, INC. EDCP  o  2001    20

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