STANDSTILL AGREEMENT
This Standstill Agreement (the "Agreement") is made and entered into as of
February 26, 2009, by and between Xxxx Xxxx ("Xxxx"), Coliseum Capital
Management, LLC ("Coliseum Management"), Coliseum Capital, LLC ("Coliseum
Capital"), Coliseum Capital Partners, L.P. ("Coliseum Partners"), and
Xxxxxxxxxxx Xxxxxxxxxx ("Xxxxxxxxxx" and, together with Xxxx, Coliseum
Management, Coliseum Capital, and Coliseum Partners, the "Restricted Persons"),
and DEI Holdings, Inc., a Florida corporation (the "Company").
RECITALS
WHEREAS, the Restricted Persons own (directly or beneficially) certain of
the Company's obligations incurred by the Company pursuant to that certain
Amended and Restated Credit Agreement dated as of September 22, 2006 (as further
amended from time to time) (the "Debt"); and
WHEREAS, the Restricted Persons own (directly or beneficially) certain
shares of the Company's common stock; and
WHEREAS, Xxxx desires to join the Board of Directors of the Company (the
"Board"); and
WHEREAS, certain of the Restricted Persons desire to obtain certain rights
as set forth in that certain Registration Rights Agreement attached hereto as
Exhibit A (the "RRA"); and
WHEREAS, as a condition to Xxxx joining the Board and the granting of the
rights set forth in the RRA, the Company wishes to restrict the ability of the
Restricted Persons and their representatives and affiliates to purchase
additional Debt as set forth in this Agreement; and
WHEREAS, the Restricted Persons agree to be bound by such restrictions.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Restrictions on Debt Purchases. Each of the Restricted Persons agrees,
------------------------------
severally and not jointly, that from and after the date of this Agreement,
neither such Restricted Person nor any of its representatives or affiliates
will, without the prior written consent of the Company or its Board, directly or
indirectly (including, without limitation, on behalf of any persons or entities
for which such Restricted Person holds investment authority):
(a) acquire, offer to acquire, or agree to acquire, directly or
indirectly, by purchase or otherwise, any additional Debt or direct or indirect
rights to acquire any additional Debt;
(b) make any public announcement with respect to, or submit a proposal
for or offer of (with or without conditions), any purchase of additional Debt;
or
(c) enter into any discussions, negotiations, arrangements, or
understandings with any third party with respect to any of the foregoing.
Notwithstanding the foregoing, however, each Restricted Person may undertake any
of the actions set forth in paragraph 1(a), 1(b) or 1(c) above provided that
such action or actions shall not result in the Restricted Persons beneficially
owning in the aggregate more than 20% of the outstanding principal amount of the
Debt.
2. Remedies. The Restricted Persons acknowledge and agree that the Company
--------
would not have an adequate remedy at law in the event any of the provisions of
this Agreement are not performed in accordance with their specific terms or are
breached. Accordingly, the Restricted Persons agree that the Company shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this Agreement in any
action instituted in any court of competent jurisdiction, in addition to any
other remedies that may be available to it. In addition to and without limiting
the foregoing, Xxxx agrees that, in the event that any of the Restricted Persons
breach any of the provisions of this Agreement, Xxxx will tender his resignation
as a director of the Company promptly upon the request of the Company.
3. Termination. This Agreement shall terminate:
-----------
(a) in the case of Xxxx, 90 days following the date on which Xxxx ceases
to be a member of the Board; and
(b) in the case of Coliseum Management, Coliseum Capital, or Coliseum
Partners, the earlier of (i) 90 days following the date on which Xxxx is not
employed by or affiliated with Coliseum Management, Coliseum Capital, or
Coliseum Partners, and (ii) 90 days following the date on which Xxxx ceases to
be a member of the Board; and
(c) in the case of Xxxxxxxxxx, the earliest of (i) 90 days following the
date on which Xxxx is not employed by or affiliated with Coliseum Management,
Coliseum Capital, or Coliseum Partners, and (ii) 90 days following the date on
which Xxxx ceases to be a member of the Board, and (iii) 90 days following the
date on which Xxxxxxxxxx is not employed by or affiliated with Coliseum
Management, Coliseum Capital, or Coliseum Partners.
[Remainder of Page Intentionally Left Blank]
2
IN WITNESS WHEREOF, the parties have executed this Standstill Agreement as
of the date first written above.
DEI HOLDINGS, INC.
By:/s/ Xxxxx X. Xxxxxxx
----------------------------------------------
Name:Xxxxx X. Xxxxxxx
--------------------------------------------
Its: CEO
---------------------------------------------
/s/ Xxxx Xxxx
-------------------------------------------------
Xxxx Xxxx
COLISEUM CAPITAL MANAGEMENT, LLC
By: /s/ Xxxxxxxxxxx Xxxxxxxxxx
----------------------------------------------
Name: Xxxxxxxxxxx Xxxxxxxxxx
Its: Manager
COLISEUM CAPITAL, LLC
By: /s/ Xxxx Xxxx
----------------------------------------------
Name: Xxxx Xxxx
Its: Manager
COLISEUM CAPITAL PARTNERS, L.P.
By: Coliseum Capital, LLC, General Partner
By: /s/ Xxxx Xxxx
---------------------------------------
Name: Xxxx Xxxx
Its: Manager
/s/ Xxxxxxxxxxx Xxxxxxxxxx
-------------------------------------------------
Xxxxxxxxxxx Xxxxxxxxxx
3
