Exhibit 10.1
EXCHANGE AGREEMENT
by and among
QUIKSILVER, INC.,
QUIKSILVER AMERICAS, INC.,
MOUNTAIN & WAVE S.À R.L.,
THE LENDERS PARTY HERETO
and
RHÔNE GROUP L.L.C.
Dated as of June 24, 2010

 

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TABLE OF CONTENT
 

                                    Page       1.     DEFINITIONS.     A-1    
2.     THE EXCHANGES     A-4           2.1   The First Exchange     A-4        
  2.2   The Standby Exchange     A-4           2.3   Closing Dates of the
Exchanges     A-5           2.4   Exchange Fee     A-5           2.5   Delivery
of the Common Stock     A-5           2.6   Delivery of the Stockholders
Agreement     A-5           2.7   Replacement Notes     A-5     3.    
STOCKHOLDER APPROVAL.     A-6           3.1   Stockholders’ Meeting     A-6    
      3.2   Preparation of Proxy Statement and Board and Stockholder Action    
A-6     4.     REPRESENTATIONS AND WARRANTIES.     A-7           4.1  
Representations and Warranties of the Company and the Borrowers     A-7        
  4.2   Representations and Warranties of Rhône and the Lenders     A-9     5.  
  COVENANTS     A-10           5.1   Modification of Credit Agreements     A-10
          5.2   Beneficial Ownership     A-10           5.3   Preemptive Rights
    A-10     6.     CONDITIONS PRECEDENT TO THE EXCHANGES.     A-11          
6.1   Conditions Precedent to each of the First Exchange and the Standby
Exchange     A-11           6.2   Conditions Precedent to the Standby Exchange  
  A-13     7.     TERMINATION; FEES AND EXPENSES.     A-13           7.1  
Termination     A-13           7.2   Termination Fee     A-13           7.3  
Expenses     A-13     8.     MISCELLANEOUS     A-14           8.1   Payment of
Taxes     A-14           8.2   Notices     A-14           8.3   Agent     A-14  
        8.4   Governing Law     A-14           8.5   Submission to Jurisdiction
    A-15           8.6   Service of Process     A-15           8.7   Waiver of
Venue     A-15           8.8   Persons Benefiting     A-15           8.9  
Indemnification     A-15           8.10   Counterparts     A-16           8.11  
Further Assurances     A-16           8.12   Successors and Assigns     A-16    
      8.13   Survival     A-16           8.14   Publicity     A-16          
8.15   Exchange Rate     A-16           8.16   Severability     A-16          
8.17   Headings     A-16           8.18   Entire Agreement     A-16          
8.19   Limitation of Liability     A-16  

 

         
SIGNATURES
       
Schedules and Exhibits
       
Schedule 2.1(a)
    A-19  
Schedule 4.2(g)
    A-20  
EXHIBIT 2.6 — Form of Stockholders Agreement
       

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EXCHANGE AGREEMENT
 
This EXCHANGE AGREEMENT (the “Agreement”) is entered into as of June 24, 2010,
among Rhône Group L.L.C. (“Rhône”), Romolo Holdings C.V., Triton SPV L.P.,
Triton Onshore SPV L.P., Triton Offshore SPV L.P. and Triton Coinvestment SPV
L.P. (each, a “Lender”, and collectively, the “Lenders”); Quiksilver, Inc. (the
“Company”); Quiksilver Americas, Inc. (the “US Borrower”); and Mountain & Wave
S.à r.l. (the “European Borrower” and, together with the US Borrower, the
“Borrowers”).
 
WHEREAS, the Lenders have made term loans to the US Borrower with an original
principal amount of $125,000,000 (the “US Term Loans”) pursuant to the Credit
Agreement, dated as of July 31, 2009, among the Company, the US Borrower, Rhône,
as administrative agent, and the Lenders (the “US Credit Agreement”);
 
WHEREAS, the Lenders have made term loans to the European Borrower with an
original principal amount of €20,000,000 (the “European Term Loans” and,
together with the US Term Loans, the “Term Loans”) pursuant to the Credit
Agreement, dated as of July 31, 2009, among the Company, the European Borrower,
Rhône, as administrative agent, and the Lenders (the “European Credit Agreement”
and, together with the US Credit Agreement, the “Credit Agreements”);
 
WHEREAS, the Company, the Borrowers, Rhône and the Lenders have entered into a
letter agreement, dated as of June 14, 2010 (the “Letter Agreement”), providing
that, subject to satisfaction of the conditions set forth therein,
(i) $75,000,000 principal amount of the Term Loans shall be exchanged for shares
of Common Stock; (ii) up to the total remaining principal amount outstanding
under the Term Loans may, at the option of the Borrowers, be exchanged for
shares of Common Stock; (iii) the terms of the Credit Agreements shall be
amended; and (iv) the Company, the Lenders and Rhône Capital III L.P. shall, at
the closing of the transactions contemplated therein, enter into a stockholders
agreement (the “Stockholders Agreement”); and
 
WHEREAS, the Company, the Borrowers, Rhône and the Lenders have determined to
enter into this Agreement to give effect to the terms of the Letter Agreement
and to terminate the Letter Agreement.
 
NOW THEREFORE, in consideration of the mutual covenants and conditions set forth
herein, the sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:
 

1.   DEFINITIONS.

 
As used in this Agreement, the following terms shall have the following
meanings:
 
“Affiliate” means with respect to any Person, a Person that directly or
indirectly controls, is controlled by or is under direct or indirect common
control with such Person. For purposes of this definition, “control” when used
with respect to any Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.
 
“Agreement” has the meaning set forth in the preamble to this Agreement.
 
“Board” means the Board of Directors of the Company.
 
“Borrowers” has the meaning set forth in the preamble to this Agreement and
their successors and assigns.
 
“Business Day” means any day that is not a day on which banking institutions are
authorized or required to be closed in the State of New York.
 
“Bylaws” means the Company’s Amended and Restated Bylaws, as amended from time
to time.
 
“Capital Stock” means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated) equity of the Company, including any preferred stock but
excluding any debt securities convertible into such equity.

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“Certificate of Incorporation” means the Company’s Restated Certificate of
Incorporation, as amended from time to time.
 
“Common Stock” means the common stock, par value $0.01 per share, of the
Company.
 
“Common Stock Equivalent” means any warrant, right or option to acquire any
shares of Common Stock or any security convertible or exchangeable into shares
of Common Stock.
 
“Company” has the meaning set forth in the preamble to this Agreement and shall
be deemed to include its successors and assigns.
 
“Credit Agreements” has the meaning set forth in the recitals to this Agreement.
 
“DGCL” means the Delaware General Corporation Law.
 
“Dollars” and “$” mean lawful money of the United States.
 
“European Borrower” has the meaning set forth in the recitals to this Agreement
and its successors and assigns.
 
“European Credit Agreement” has the meaning set forth in the recitals to this
Agreement.
 
“European Term Loans” has the meaning set forth in the recitals to this
Agreement.
 
“Euros” and “€” mean the single currency of the member states of the European
Communities that adopt or have adopted the Euro as their lawful currency in
accordance with the legislation of the European Union relating to European
Monetary Union.
 
“Exchanges” means the First Exchange and the Standby Exchange.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Exchange Fee” has the meaning set forth in Section 2.4.
 
“Exchange Ratio” means $4.50 per share of Common Stock.
 
“First Exchange” has the meaning set forth in Section 2.1(a).
 
“First Exchange Closing Date” has the meaning set forth in Section 2.3(a).
 
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder.
 
“Lenders” has the meaning set forth in the preamble to this Agreement.
 
“Letter Agreement” has the meaning set forth in the recitals to this Agreement.
 
“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities, or
condition (financial or otherwise) of the Company and the Borrowers taken as a
whole; (b) a material impairment of the ability of the Company or either
Borrower to perform its obligations under this Agreement or, solely with respect
to the Company, the Stockholders Agreement; or (c) a material impairment of the
rights and remedies of Rhône, the Lenders and/or Rhône Capital III L.P., as
applicable, under the Credit Agreements (for so long as the Credit Agreements
will remain outstanding after giving effect to the Exchanges), the Warrant
Agreement, this Agreement or the Stockholders Agreement.
 
“Note” means a promissory note made by either of the Borrowers in favor of any
Lender pursuant to the US Credit Agreement and/or the European Credit Agreement.
 
“NYSE” means the New York Stock Exchange.
 
“Permitted Transaction” means any acquisition of any Common Stock or Common
Stock Equivalent (i) by Rhône or any of its Affiliates (including, for the
avoidance of doubt, any partner or employee of

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Rhône then serving on the Board) directly from the Company or (ii) made pursuant
to a tender or exchange offer made to all stockholders of the Company.
 
“Person” means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
 
“Preferred Stock” means the preferred stock, par value $0.01 per share, of the
Company.
 
“Proxy Statement” means the proxy statement, together with any amendments or
supplements thereto and any other related proxy materials, including, without
limitation, any preliminary proxy materials, relating to the Stockholder
Approval of the Exchanges.
 
“Rhône” has the meaning set forth in the preamble to this Agreement.
 
“Rhône Directors” means any director of the Board that is appointed pursuant to
Section 9.4 of the Warrant Agreement or Section 6.2 of the Stockholders
Agreement.
 
“Rhône Material Adverse Effect” means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities,
or condition (financial or otherwise) of Rhône taken as a whole; (b) a material
impairment of the ability of Rhône or Rhône Capital III L.P., as applicable, to
perform its obligations under this Agreement or the Stockholders Agreement; or
(c) a material impairment of the rights and remedies of the Company or the
Borrowers under the Credit Agreements (for so long as the Credit Agreements will
remain outstanding after giving effect to the Exchanges), the Warrant Agreement,
this Agreement or the Stockholders Agreement.
 
“SEC” means the United States Securities and Exchange Commission.
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Series A Preferred Stock” means the convertible non-voting preferred stock, par
value $0.01 per share, of the Company on the terms set forth in Exhibit C of the
Warrant Agreement.
 
“Special Meeting” has the meaning set forth in Section 3.1(a).
 
“Standby Exchange” has the meaning set forth in Section 2.2(a).
 
“Standby Exchange Closing Date” has the meaning set forth in Section 2.3(b).
 
“Standby Exchange Exercise Date” has the meaning set forth in Section 2.2(a).
 
“Standby Shares” has the meaning set forth in Section 2.2(a).
 
“Stockholder Approval” has the meaning set forth in Section 3.1(a).
 
“Stockholders Agreement” has the meaning set forth in the recitals to this
Agreement.
 
“Termination Fee” has the meaning set forth in Section 7.2.
 
“Term Loans” has the meaning set forth in the recitals to this Agreement.
 
“US Borrower” has the meaning set forth in the recitals to this Agreement.
 
“US Credit Agreement” has the meaning set forth in the recitals to this
Agreement.
 
“US Term Loans” has the meaning set forth in the recitals to this Agreement.
 
“Voting Stock” means all classes of Capital Stock of the Company then
outstanding and normally entitled to vote in the election of directors.
 
“Warrant Agreement” means the Warrant and Registration Rights Agreement, dated
as of July 31, 2009, by and among the Company, Rhône Capital III L.P. and the
initial Warrant holders party thereto.
 
“Warrants” means the warrants issued by the Company from time to time pursuant
to the Warrant Agreement.

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2.   THE EXCHANGES.

 
2.1 The First Exchange.
 
(a) Subject to the terms and conditions hereof, on the First Exchange Closing
Date, the Company shall issue to the Lenders the number of shares of Common
Stock set forth opposite such Lender’s name on Schedule 2.1(a) attached hereto
in redemption and prepayment of $75,000,000 of the aggregate principal amount of
the Term Loans (such redemption and prepayment to be applied on a pro rata basis
against the principal amounts outstanding under the US Term Loans and the
European Term Loans and such issuance and redemption and prepayment being
referred to herein as the “First Exchange”), and the principal amounts of the US
Terms Loans and the European Term Loans shall be, without any further action,
permanently reduced by such amounts. The reduction of the principal amounts
outstanding under the Term Loans upon completion of the First Exchange shall be
permanent and will constitute a “prepayment” for purposes of Section 2.05 of
each of the US Credit Agreement and the European Credit Agreement, and at the
closing of the First Exchange, the US Borrower shall make payment of all amounts
due under Section 2.09(a) of the US Credit Agreement in connection with such
prepayment. Each Lender hereby (i) waives the provisions of Section 2.05(a)(ii)
of each of the US Credit Agreement and the European Credit Agreement in
connection with the prepayments of the Terms Loans described in this
Section 2.1(a), and (ii) consents to any Investment (as defined in the
applicable Credit Agreement) deemed to be made by the Company or any of its
subsidiaries pursuant to or otherwise resulting from the First Exchange.
 
(b) Upon the closing of the First Exchange, the Company shall make a payment to
the Lenders for any interest accrued (which payment may be made in cash or as a
PIK Amount (as defined in the applicable Credit Agreement) to the extent
permitted under the applicable Credit Agreement) on the principal amounts of the
Term Loans that are subject to the First Exchange.
 
2.2 The Standby Exchange.
 
(a) The Borrowers shall have the right, exercisable in the sole discretion of
the Borrowers, by delivering notice in accordance with Section 2.2(b) hereof on
or prior to August 23, 2010 (the “Standby Exchange Exercise Date”), to require
the Lenders to exchange, on a pro rata basis calculated based on each Lender’s
interest in the Term Loans, all or a portion of the remaining principal amount
of the Term Loans for a number of shares of Common Stock issued by the Company
equal to the portion of such remaining principal amount of the Term Loans that
the Borrowers elect to exchange pursuant to this Section 2.2(a) divided by the
Exchange Ratio (subject to the following proviso, the “Standby Shares”) (such
issuance and exchange and related redemption and prepayment of the Term Loans
are referred to herein as the “Standby Exchange”); provided that the Borrowers
may only exercise their option under this Section 2.2(a) to such extent that the
number of shares of Common Stock issued to the Lenders in the Standby Exchange
(taking into account all shares of Common Stock and Warrants then held by the
Lenders and their Affiliates) shall not result in a “change in control”, “change
of control” or similar concept occurring under any indenture, loan agreement,
mortgage, deed of trust, contract or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries or any of their properties may be bound.
 
(b) In the event the Borrowers exercise their option with respect to the Standby
Exchange, the Borrowers shall provide to the Lenders an irrevocable, written
notice, in accordance with Section 8.2, of such election, and such notice shall
be delivered to the Lenders no later than 5:00 pm, New York time, on the Standby
Exchange Exercise Date and shall specify the aggregate principal amount of Term
Loans subject to the Standby Exchange. The Borrowers may provide notice under
this Section 2.2(b) one time only.
 
(c) On the Standby Exchange Closing Date, the Company shall issue to the
Lenders, on a pro rata basis consistent with each Lender’s interest in the Term
Loans the Standby Shares in redemption and prepayment of an aggregate of such
principal amount, which shall be applied on a pro rata basis against the
principal amounts outstanding under the US Term Loans and the European Term
Loans, and the principal amounts of the US Term Loans and the European Term
Loans shall be, without any further action, permanently reduced by such amounts.
The reduction of the principal amounts outstanding under the Term Loans upon
completion of the

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Standby Exchange will constitute a “prepayment” for purposes of Section 2.05 of
each of the US Credit Agreement and the European Credit Agreement, and at the
closing of the Standby Exchange, the US Borrower shall make payment of all
amounts due under Section 2.09 of the US Credit Agreement in connection with
such prepayment (including, without limitation, any obligations under
Section 2.09(b) of the US Credit Agreement arising from the full repayment of
the Term Loans, if applicable). Each Lender hereby (i) waives the provisions of
Section 2.05(a)(ii) of each of the US Credit Agreement and the European Credit
Agreement in connection with the prepayments of the Term Loans described in this
Section 2.2(c), and (ii) consents to any Investment (as defined in the
applicable Credit Agreement) deemed to be made by the Company or any of its
subsidiaries pursuant to or otherwise resulting from the Standby Exchange.
 
(d) Upon the closing of the Standby Exchange, the Company shall make a payment
to the Lenders for any interest accrued (which payment may be in cash or as a
PIK Amount (as defined in the applicable Credit Agreement) to the extent
permitted under the applicable Credit Agreement) on the principal amounts of the
Term Loans that are subject to the Standby Exchange.
 
2.3 Closing Dates of the Exchanges.
 
(a) The closing of the First Exchange shall occur on the later of (i) August 1,
2010 and (ii) one Business Day following satisfaction of the conditions
precedent to closing of the First Exchange set forth under Section 6.1 (the
“First Exchange Closing Date”).
 
(b) The closing of the Standby Exchange shall occur on (i) the latest of
(A) August 1, 2010, (B) one Business Day following satisfaction of the
conditions to closing of the Standby Exchange set forth under Sections 6.1 and
6.2 and (C) five Business Days following delivery of a notice by the Borrowers
to the Lenders, in accordance with Section 2.2(a), that the Borrowers are
exercising their option with respect to the Standby Exchange or (ii) such other
date as mutually agreed by the Lenders and the Borrowers (the “Standby Exchange
Closing Date”), it being agreed that, if feasible, the First Exchange and the
Standby Exchange will close simultaneously.
 
2.4 Exchange Fee.  Upon the closing of each of the First Exchange and the
Standby Exchange, the Company shall pay to Rhône, as agent for the Lenders, on
the First Exchange Closing Date and the Standby Exchange Closing Date, each as
applicable, an exchange fee equal to 4.75% of the value of the principal amount
of the Term Loans subject to such Exchange (an “Exchange Fee”). For the
avoidance of doubt, the Company’s payment of the Exchange Fees shall not relieve
the obligations of the US Borrower under Sections 2.05(a), 2.09(a) and 2.09(b)
of the US Credit Agreement to pay all fees due to the Lenders in connection with
the partial or full prepayment of the principal amounts of the US Term Loans.
 
2.5 Delivery of the Common Stock.  At the closing of each of the First Exchange
and the Standby Exchange, the Company shall deliver, or cause to be delivered,
to the Lenders certificates (bearing the legend substantially in the form set
forth in Section 2.2(e) of the Stockholders Agreement) representing the Common
Stock issued in such Exchange.
 
2.6 Delivery of the Stockholders Agreement.  At the closing of the First
Exchange, the Company, the Lenders and Rhône Capital III L.P. shall execute and
deliver the Stockholders Agreement substantially in the form set forth in
Exhibit 2.6.
 
2.7 Replacement Notes.  At the closing of each of the First Exchange and the
Standby Exchange, to the extent that as of such closing the Term Loans shall not
have been repaid in full, at the request of any applicable Lender, each
applicable Borrower shall replace any Note previously issued to a Lender
pursuant to either Credit Agreement with a new Note, substantially in the form
of such previously issued Note, which shall evidence such Lender’s outstanding
loans under the applicable Credit Agreement after giving effect to such
Exchange.

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3.   STOCKHOLDER APPROVAL.

 
3.1 Stockholders’ Meeting.
 
(a) As soon as practicable, but no later than 90 days after the date hereof, the
Company shall hold a special meeting of its stockholders (the “Special Meeting”)
for the purpose of obtaining stockholder approval of the Exchanges (the
“Stockholder Approval”) in accordance with the stockholder approval requirements
set forth in Section 312.03 of the NYSE Listed Company Manual.
 
(b) The Company shall use its reasonable best efforts to (i) solicit from its
stockholders proxies in favor of the approval of the Exchanges and (ii) take any
and all other actions reasonably necessary or advisable to secure the
affirmative vote of its stockholders required by the DGCL, the Certificate of
Incorporation, the Bylaws, this Agreement, the Stockholders Agreement and the
rules and regulations of the NYSE, to obtain the Stockholder Approval.
 
(c) Nothing in this Section 3.1 shall prevent the Board from acting in
accordance with its fiduciary duties or applicable law or from acting in good
faith in accordance with the Certificate of Incorporation and the Bylaws, while
giving due consideration to the intent of this Agreement.
 
3.2 Preparation of Proxy Statement and Board and Stockholder Action.
 
(a) The Company shall use its reasonable best efforts to, promptly after the
date hereof, in cooperation with Rhône and its advisors, prepare and file with
the SEC the Proxy Statement. The Proxy Statement shall comply as to form and
substance in all material respects with the applicable provisions of the
Exchange Act. The Company shall use its reasonable best efforts to respond as
promptly as reasonably practicable to any comments of the SEC with respect to
the Proxy Statement and to cause the definitive Proxy Statement to be filed with
the SEC and to be mailed to its stockholders as promptly as reasonably
practicable following the date of this Agreement or, if applicable, following
confirmation by the SEC or its staff that it has no further comments on the
Proxy Statement. The Company shall promptly notify Rhône upon the receipt of any
written or oral comments from the SEC or its staff or any written or oral
request from the SEC or its staff for amendments or supplements to the Proxy
Statement and shall provide Rhône with copies of all correspondence between the
Company and its representatives, on the one hand, and the SEC and its staff, on
the other hand, with respect thereto. Prior to filing or mailing the Proxy
Statement (or any amendment or supplement thereto) or responding to any comments
of the SEC with respect thereto (orally or in writing), the Company shall
(i) provide Rhône and its counsel an opportunity to review and comment on such
document or response and (ii) give reasonable consideration to all comments
proposed by Rhône or its counsel.
 
(b) The Company shall use its reasonable best efforts to promptly and duly call,
give notice of, convene and hold, the Special Meeting and take all other
necessary actions so that, as promptly as reasonably practicable following the
mailing of the Proxy Statement, the Special Meeting for the purpose of obtaining
the Stockholder Approval is held. Subject to Section 3.1(c), the Company shall
include in the Proxy Statement the unanimous recommendation of the Board (with
the Rhône Directors taking no part in such recommendation) that the stockholders
of the Company approve the issuance and sale of the shares of Common Stock in
the Exchanges and vote in favor of such issuance.
 
(c) The information supplied by the Company for inclusion in the Proxy Statement
shall not, at (i) the time the Proxy Statement (or any amendment thereof or
supplement thereto) is first mailed to the stockholders and (ii) the time of the
Special Meeting, contain any untrue statement of a material fact or fail to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. If, at any time prior to the Special Meeting, any event or
circumstance relating to the Company, or its officers or directors, should be
discovered by the Company which should be set forth in an amendment or a
supplement to the Proxy Statement, the Company shall promptly inform Rhône.

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4.   REPRESENTATIONS AND WARRANTIES.

 
4.1 Representations and Warranties of the Company and the Borrowers.  The
Company and the Borrowers, jointly and severally, represent and warrant to Rhône
and each of the Lenders that:
 
(a) Existence, Power and Ownership.  The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Each of the Borrowers is a corporation or a private limited liability
company, duly organized or formed, validly existing, and, where applicable, in
good standing under the laws of the jurisdiction of its incorporation or
organization.
 
(b) Authorization.  The Company and each of the Borrowers has the corporate or
other requisite power and authority to enter into this Agreement and to perform
its obligations under, and consummate the transactions contemplated by, this
Agreement and, solely with respect to the Company, the Stockholders Agreement,
and has by proper action duly authorized the execution and delivery of this
Agreement and, solely with respect to the Company, the Stockholders Agreement.
 
(c) No Conflicts.  None of the execution and delivery of this Agreement by the
Company or the Borrowers, or, solely with respect to the Company, the
Stockholders Agreement by the Company, or the consummation of the transactions
contemplated herein or therein or the performance of and compliance with the
terms and provisions hereof or thereof will: (i) violate or conflict with any
provision of the Certificate of Incorporation or the Bylaws, or any of the
Borrowers’ certificate of incorporation, bylaws or other constituent documents;
(ii) violate any law, regulation, order, writ, judgment, injunction, decree or
permit applicable to the Company or any of the Borrowers; (iii) violate or
materially conflict with any contractual provisions of, or cause an event of
default under, any material indenture, loan agreement, mortgage, deed of trust,
contract or other agreement or instrument to which the Company or any of the
Borrowers is a party or by which the Company or any of the Borrowers or any of
their properties may be bound; or (iv) result in or require the creation of any
lien, security interest or other charge or encumbrance upon or with respect to
their properties, except in the case of clauses (ii), (iii) and (iv), for such
violations, conflicts or defaults, or liens, security interests or encumbrances
that would not, individually or in the aggregate, result in a Material Adverse
Effect.
 
(d) Consents.  Subject to (i) the filing of a notification under the HSR Act and
the expiration or termination of the waiting period required thereunder,
(ii) receipt of the Stockholder Approval, (iii) the accuracy of the
representations and warranties of Rhône and the Lenders set forth in Section 4.2
hereof, (iv) the filing of a supplemental listing application in accordance with
the NYSE Listed Company Manual and (v) any consents, approvals or authorizations
already obtained on or prior to the date hereof and in full force and effect, no
consent, approval, authorization or order of, or filing, registration or
qualification with, any court or governmental authority or other Person is
required in connection with the execution, delivery or performance of this
Agreement.
 
(e) Enforceable Obligations.  This Agreement has been, and at the closing of the
First Exchange, the Stockholders Agreement will be, duly executed and delivered
by the Company and, solely with respect to this Agreement, each of the Borrowers
and assuming due authorization, execution and delivery hereof by Rhône and each
of the Lenders, this Agreement constitutes and, at the closing of the First
Exchange, the Stockholders Agreement will constitute, a legal, valid and binding
obligation of the Company and, solely with respect to this Agreement, each of
the Borrowers, enforceable in accordance with their terms subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.
 
(f) Capitalization.  As of the date hereof, the Company’s authorized capital
stock consists of (i) 285,000,000 shares of Common Stock of which
132,596,464 shares of Common Stock were issued and outstanding and
(ii) 5,000,000 shares of Preferred Stock, including, without limitation,
1,000,000 shares of Series A Preferred Stock of which no shares were issued and
outstanding. As of the date hereof, 2,885,200 shares of Common Stock are held in
treasury, 13,269,447 shares of Common Stock are reserved for issuance upon
exercise of outstanding stock options, 1,693,227 shares of Common Stock

A-7

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are reserved for future issuance under the Company’s equity compensation plans,
and 25,653,831 shares of Common Stock are reserved for issuance upon exercise of
the Warrants. As of the date hereof, 1,000,000 shares of Series A Preferred
Stock are reserved for issuance upon exercise of the Warrants. There are no
authorized or outstanding securities of the Company of any kind or class having
power generally to vote in the election of directors other than the Common
Stock. There are no other classes of capital stock of the Company authorized or
outstanding. The outstanding shares of Common Stock are duly authorized, validly
issued, fully paid and non-assessable. As of the date hereof, there are no
preemptive rights (other than as set forth in Section 6.5 of the Stockholders
Agreement and Section 5.6 of the Warrant Agreement) or other outstanding rights,
options, warrants, conversion rights or agreements or commitments of any
character relating to the Company’s authorized and issued, unissued or treasury
shares of capital stock, and the Company has not issued any debt securities,
other securities, rights or obligations that are currently outstanding and
convertible into or exchangeable for, or giving any Person a right to subscribe
for or acquire, capital stock of the Company.
 
(g) Board Approvals.  (i) The Board has taken all corporate actions necessary
under the Certificate of Incorporation, the Bylaws and the DGCL, including,
without limitation, for purposes of Section 203 thereunder, to approve the
transactions contemplated herein, and (ii) other than the Rhône Directors who
abstained from all discussion and voting with respect to the Exchanges, the
Board resolved to recommend that stockholders of the Company approve the
issuance and sale of the shares of Common Stock in the Exchanges and vote in
favor of such issuance (the “Recommendation”), and no such approval or
recommendation has been withdrawn; provided, however, that nothing in this
Section 4.1(g) shall prevent the Board from acting in accordance with its
fiduciary duties or applicable law or from acting in good faith in accordance
with the Certificate of Incorporation and the Bylaws.
 
(h) Issuance of Common Stock.  The Common Stock to be issued pursuant to the
Exchanges against payment therefor, when so issued and delivered by the Company,
will have been (i) duly and validly authorized, issued, fully paid and
nonassessable, free and clear of any mortgage, pledge, lien, security interest,
claim, voting agreement, conditional sale agreement, title retention agreement,
restriction, option or encumbrance of any kind, character or description
whatsoever, other than those contained in the Stockholders Agreement, and no
Person (other than each of the Lenders) will have any preemptive right of
subscription, purchase or share issuance in respect thereof, (ii) free of any
restrictions on transfer other than restrictions on transfer under applicable
federal and state securities laws and restrictions provided under Section 2.1 of
the Stockholders Agreement, and (iii) assuming the accuracy of the
representations and warranties of Rhône and the Lenders set forth in Section 4.2
hereof, issued in compliance with all applicable federal and state securities
laws. The Company has duly authorized and reserved a sufficient number of shares
of Common Stock for issuance upon the completion of the Exchanges pursuant to
the terms of this Agreement.
 
(i) State Takeover Statutes Inapplicable.  The Board has taken all corporate
actions necessary so that Section 203 of the DGCL is inapplicable to the
issuance of shares of Common Stock pursuant to the Exchanges. No other “fair
price,” “moratorium,” “control share acquisition” or other similar anti-takeover
statute or regulation is applicable to the issuance of shares of Common Stock
pursuant to the Exchanges.
 
(j) No Registration Requirement.  None of the Company or any of its subsidiaries
has directly, or through any agent, (i) sold, offered for sale, solicited offers
to buy or otherwise negotiated in respect of, any “security” (as defined in the
Securities Act) that is or would be integrated with the issuance of the Common
Stock pursuant to the Exchanges in a manner that would require the registration
under the Securities Act of the Common Stock issued pursuant to the Exchanges or
(ii) engaged in any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Securities Act) in connection
with the offering of the Common Stock issued pursuant to the Exchanges or in any
manner involving a public offering within the meaning of Section 4(2) of the
Securities Act. Assuming the accuracy of the representations and warranties of
Rhône and the Lenders in Section 4.2 hereof, it is not necessary in connection
with the offer, sale and delivery of the Common Stock issuable in connection
with the Exchanges in the manner contemplated herein to register any of such
Common Stock under the Securities Act.

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(k) Proxy Statement.  The Proxy Statement filed with the SEC shall not contain
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements contained therein, in light of the
circumstances under which they were made, not misleading at the time of (i) the
mailing of the definitive Proxy Statement to the Company’s stockholders, and
(ii) the Special Meeting. Notwithstanding the foregoing, the representation and
warranty made in this Section 4.1(k) does not apply to statements made or
statements omitted in reliance upon and in conformity with written information
furnished to the Company by Rhône with respect to Rhône and the Lenders
expressly for use in the Proxy Statement or any amendment thereof.
 
4.2 Representations and Warranties of Rhône and the Lenders.  Rhône and each of
the Lenders, severally and not jointly, hereby represents and warrants that:
 
(a) Authorization.  Rhône and each of the Lenders has the corporate or limited
liability company, as the case may be, power and authority to enter into this
Agreement and the Stockholders Agreement and to perform its obligations under,
and consummate the transactions contemplated by, this Agreement and the
Stockholders Agreement and has by proper action duly authorized the execution
and delivery of this Agreement and the Stockholders Agreement.
 
(b) No Conflicts.  None of the execution and delivery of this Agreement and the
Stockholders Agreement by Rhône and each of the Lenders and the consummation of
the transactions contemplated herein or therein or the performance of and
compliance with the terms and provisions hereof or thereof will: (i) violate or
conflict with any provision of the constituent documents of Rhône or any of the
Lenders; or (ii) violate any law, regulation, order, writ, judgment, injunction,
decree or permit applicable to Rhône or any of the Lenders, except in the case
of clause (ii), for such violations that would not, individually or in the
aggregate, result in a Rhône Material Adverse Effect.
 
(c) Enforceable Obligations.  This Agreement has been, and at the closing of the
First Exchange, the Stockholders Agreement will be, duly executed and delivered
by Rhône and each of the Lenders and assuming due authorization, execution and
delivery hereof by the Company and each of the Borrowers, this Agreement
constitutes, and, at the closing of the First Exchange, the Stockholders
Agreement will constitute, a legal, valid and binding obligation of Rhône and
each of the Lenders, enforceable in accordance with their terms subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.
 
(d) Investment Intent.  Each Lender acknowledges that the Common Stock issued
pursuant to the Exchanges will not have been, at the time of issuance,
registered under the Securities Act or under any state securities laws. Each
Lender (i) is acquiring the Common Stock issuable pursuant to the Exchanges
pursuant to an exemption from registration under the Securities Act and solely
for investment with no present intention to distribute any of the securities to
any Person in violation of the Securities Act or any other applicable securities
laws and (ii) will not sell or otherwise dispose of any of such Common Stock,
except in compliance with the registration requirements or exemption provisions
of the Securities Act and any other applicable securities laws.
 
(e) Accredited Investor Status.  (i) Each Lender is an “accredited investor” as
such term is defined in Rule 501(a) promulgated under the Securities Act whose
knowledge and experience in financial and business matters are such that each
Lender is capable of evaluating the merits and risks of its investment in the
shares of Common Stock issuable pursuant to the Exchanges and (ii)(A) each
Lender’s financial situation is such that each Lender can afford to bear the
economic risk of holding the shares of Common Stock issuable pursuant to the
Exchanges for an indefinite period of time, (B) each Lender can afford to suffer
complete loss of its investment in shares of Common Stock issuable pursuant to
the Exchanges, (C) the Company has made available to each Lender all documents
and information that each Lender has requested relating to an investment in the
Company, and (D) each Lender has had adequate opportunity to ask questions of,
and receive answers from, the Company as well as the Company’s officers,
employees, agents and other representatives concerning the Company’s business,
operations, financial condition,

A-9

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assets, liabilities and all other matters relevant to each Lender’s investment
in the shares of Common Stock issuable pursuant to the Exchanges.
 
(f) Restricted Securities.  Each of the Lenders agree that, at the time of
issuance, the Common Stock issuable pursuant to the Exchanges will not be
registered under the Securities Act or qualified under any state securities
laws. Such securities are being issued on the basis that the Exchanges and the
issuance by the Company in connection therewith of its Common Stock to the
Lenders are exempt from registration under the Securities Act and from
applicable state securities laws. Rhône and each of the Lenders agree that the
reliance by the Company on such exemptions is predicated, in part, on the
representations and warranties and other agreements of Rhône and each of the
Lenders set forth in this Agreement. Rhône and each of the Lenders acknowledge
and agree that each certificate representing the Common Stock issued in the
Exchange shall bear the legend substantially in the form set forth in
Section 2.2(e) of the Stockholders Agreement.
 
(g) Beneficial Ownership.  As of the date hereof, Rhône and its Affiliates,
including the Lenders, collectively, beneficially own, or have the right to
acquire, whether such right is exercisable immediately or only after the passage
of time, 25,758,831 shares of Common Stock.
 
(h) Term Loans.  As of the date hereof, the principal amount of US Term Loans
held by each Lender under the US Credit Agreement and the principal amount of
European Term Loans held by each Lender under the European Credit Agreement are
set forth on Schedule 4.2(g) attached hereto.
 

5.   COVENANTS

 
5.1 Modification of Credit Agreements.  In the event that immediately following
the closing of the Exchanges, $30,000,000 or less in aggregate principal amount
of the Term Loans remains outstanding, Section 7.14(a) of each of the US Credit
Agreement and the European Credit Agreement shall be modified, automatically and
without any further action, so as to replace the tables therein with the
following:
 

              Americas Consolidated

Measurement Period Ending
  EBITDA  
January 31, 2010
  $ 20,000,000  
April 30, 2010
  $ 20,000,000  
July 31, 2010
  $ 18,000,000  
October 31, 2010
  $ 24,000,000  
January 31, 2011
  $ 27,000,000  
April 30, 2011
  $ 30,000,000  
July 31, 2011
  $ 33,000,000  
October 31, 2011
  $ 39,000,000  
January 31, 2012
  $ 42,000,000  
April 30, 2012
  $ 45,000,000  
July 31, 2012
  $ 48,000,000  
October 31, 2012 and the last day of each Fiscal Quarter thereafter
  $ 51,000,000  

 
5.2 Beneficial Ownership.  Prior to the Standby Exchange Exercise Date, other
than pursuant to a Permitted Transaction or as a result of the exercise of any
preemptive rights under Section 5.6 of the Warrant Agreement, Rhône and its
Affiliates, including the Lenders, shall not, increase their aggregate
beneficial ownership of Common Stock (including, for the avoidance of doubt, any
shares of Common Stock that Rhône and its Affiliates have the right to acquire)
from the amount set forth in Section 4.2(g) hereof.
 
5.3 Preemptive Rights.  The Lenders hereby waive their respective preemptive
rights under Section 5.6 of the Warrant Agreement with respect to (i) the first
underwritten public offering of Common Stock, if any, occurring prior to
September 30, 2010 with gross proceeds of no more than $115 million and a public
offering price of no less than $4.50 per share of Common Stock and (ii) the
shares of Common Stock issuable in the Exchanges. In the event that the gross
proceeds of such offering exceed $115 million and/or the public

A-10

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offering price is less than $4.50 per share of Common Stock, the Lenders shall
deliver notice to the Company within 10 days following the pricing date relating
to such offering, of their intention to exercise their preemptive rights to
purchase at the public offering price an additional number of shares of Common
Stock to maintain their respective proportionate, as-if-exercised ownership
interest in the Company based on the number of shares of Common Stock
outstanding immediately prior to such offering. If the Lenders fail to deliver
such notice within such 10-day period, the Lenders shall be deemed to have
waived their respective preemptive rights with respect to such offering. If the
Lenders elect to exercise their preemptive rights with respect to such offering,
the closing of the exercise of such preemptive rights shall occur as soon as
reasonably practicable following the consummation of such offering or, if
applicable, the expiration of the over-allotment option, subject to obtaining
stockholder approval if required and regulatory approvals. For the avoidance of
doubt, the preemptive rights set forth in Section 5.6 of the Warrant Agreement
shall otherwise remain in effect.
 
5.4 Term Loans.  Prior to the Standby Exchange Exercise Date, each Lender shall
not sell, transfer, assign, encumber, grant a participation in or otherwise
dispose of the Term Loans held by such Lender or their rights in respect
thereof.
 

6.   CONDITIONS PRECEDENT TO THE EXCHANGES.

 
6.1 Conditions Precedent to each of the First Exchange and the Standby Exchange.
 
(a) Notwithstanding any other provision of this Agreement, none of Rhône or any
of the Lenders will be obligated to complete the First Exchange and, if
applicable, the Standby Exchange, or fulfill any other obligations arising
hereunder, unless the following conditions precedent have been (or,
substantially contemporaneously with the applicable Exchange, will be) satisfied
in full:
 
(i) Receipt within ninety (90) days of the date of this Agreement of the
Stockholder Approval;
 
(ii) The Company and the Borrowers having performed in all material respects
each of the obligations required by this Agreement to be performed or complied
with by the Company at or prior to the closing date of such Exchange;
 
(iii) If required, the filing of a notification under the HSR Act and the
expiration or termination of the waiting period and any extension of such period
under the HSR Act as applicable to the Exchanges;
 
(iv) Execution and delivery by the Company of the Stockholders Agreement;
 
(v) Delivery to the Lenders of the certificates representing the shares of
Common Stock issuable pursuant to such Exchange;
 
(vi) Delivery to Rhône and the Lenders of a legal opinion, dated as of the
closing date of such Exchange, by Skadden, Arps, Slate, Meagher & Flom LLP, the
Company’s outside legal counsel, such opinion, subject to customary limitations,
exceptions, assumptions and qualifications, to be limited to the following
matters: (A) each of this Agreement and the Stockholders Agreement has been duly
authorized, executed and delivered by the Company; (B) each of this Agreement
and the Stockholders Agreement is a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms; (C) the Common
Stock issuable to the Lenders pursuant to such Exchange, when issued to the
Lenders in accordance with the terms of this Agreement, will have been validly
issued, fully paid and nonassessable; (D) the Company is validly existing in
good standing under the laws of the State of Delaware; and (E) the execution and
delivery by the Company of this Agreement and the Stockholders Agreement and the
consummation of the applicable transactions contemplated herein or therein do
not: (x) constitute a violation of, or a default under, the material contracts
filed as Exhibits 4.1, 10.11, 10.12, 10.13 and 10.16 to the Company’s Form 10-K
for the fiscal year ended October 31, 2009, (y) result in a “change of control”
under the material contracts filed as Exhibits 4.1 and 10.13 to the Company’s
Form 10-K for the fiscal year ended October 31, 2009 (subject to (a) the
accuracy of the representation and warranty made by Rhône and the Lenders in
Section 4.2(g) hereof and (b) an officer’s certificate from the Company as to
the beneficial ownership of Rhône and its Affiliates (including the Lenders)

A-11

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(expressed as a percentage) based on the information provided in clause (a) and
in the case of Exhibit 4.1 to the Company’s Form 10-K for the fiscal year ended
October 31, 2009, the number of outstanding shares of Voting Stock of the
Company and in the case of Exhibit 10.13 to the Company’s Form 10-K for the
fiscal year ended October 31, 2009, based on the number of outstanding equity
interests of the Company entitled to vote for members of the Board on a
fully-diluted basis (as determined in accordance with and as defined in the
agreement filed as such Exhibit 10.13), in each case, such outstanding number to
be provided by the Company), or (z) violate or conflict with, or result in any
contravention of, the DGCL, the laws of the State of New York or the laws of the
State of California;
 
(vii) As of the closing date of such Exchange (except for any representation or
warranty that is expressly made as of a specified date, in which case as of such
specified date), each representation or warranty of the Company or the Borrowers
contained in this Agreement shall be true and correct in all material respects
(except for such representations and warranties as are qualified by materiality
or Material Adverse Effect, which representations and warranties shall be true
and correct in all respects);
 
(viii) Execution and delivery to Rhône of a certificate, dated as of the closing
date of such Exchange, from the Chief Executive Officer or the Chief Financial
Officer of the Company confirming that (i) the representations and warranties of
the Company contained in this Agreement are true and correct in all material
respects (except for such representations and warranties as are qualified by
materiality or Material Adverse Effect, which representations and warranties
shall be true and correct in all respects) on and as of such closing date with
the same force and effect as though such representations and warranties had been
made on and as of such closing date, other than those representations and
warranties that are made as of another date, in which case such representations
and warranties shall be true and correct as of such other date, and (ii) all
agreements, covenants, obligations and conditions required by this Agreement to
be performed or complied with by the Company at or prior to such closing date
have been performed and complied with in all material respects; and
 
(ix) The Company shall have paid to Rhône and/or each of the Lenders all amounts
due under (i) this Agreement, including, without limitation, the Exchange Fee
and all expenses provided for in Section 7.3 and (ii) the Credit Agreements as
provided in Section 2.1(a) and, if applicable, Section 2.2(c).
 
(x) No temporary restraining order, preliminary or permanent injunction or other
judgment or order issued by any governmental authority shall be in effect which
prohibits, restrains or renders illegal the consummation of the transactions
contemplated by this Agreement.
 
(b) Notwithstanding any other provision of this Agreement, none of the Company
or the Borrowers will be obligated to complete the First Exchange and, if
applicable, the Standby Exchange, or fulfill any other obligations arising
hereunder, unless the following conditions precedent have been (or,
substantially contemporaneously with the applicable Exchange, will be) satisfied
in full:
 
(i) Receipt within ninety (90) days of the date of this Agreement of the
Stockholder Approval;
 
(ii) Rhône and the Lenders having performed in all material respects each of the
obligations required by this Agreement to be performed or complied with by Rhône
and the Lenders at or prior to the closing date of such Exchange;
 
(iii) If required, the filing of a notification under the HSR Act and the
expiration or termination of the waiting period and any extension of such period
under the HSR Act as applicable to the Exchanges;
 
(iv) Execution and delivery by Rhône Capital III L.P. and each Lender of the
Stockholders Agreement; and
 
(v) As of the closing date of such Exchange (except for any representation or
warranty that is expressly made as of a specified date, in which case as of such
specified date), each representation or warranty of Rhône and the Lenders
contained in this Agreement shall be true and correct in all material respects
(except for such representations and warranties as are qualified by materiality
or Rhône Material Adverse Effect, which representations and warranties shall be
true and correct in all respects).

A-12

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(vi) No temporary restraining order, preliminary or permanent injunction or
other judgment or order issued by any governmental authority shall be in effect
which prohibits, restrains or renders illegal the consummation of the
transactions contemplated by this Agreement.
 
6.2 Conditions Precedent to the Standby Exchange.  Notwithstanding any other
provision of this Agreement, none of Rhône or any of the Lenders will be
obligated to complete the Standby Exchange if the Company fails to provide to
Rhône, pursuant to Section 2.2(a), an irrevocable, written notice on or prior to
the Standby Exchange Exercise Date.
 

7.   TERMINATION; FEES AND EXPENSES.

 
7.1 Termination.
 
(a) Subject to Section 7.1(c), in the event that Company or the Borrowers are
not obligated to complete the First Exchange due to the failure to satisfy the
conditions precedent to the closing of the Exchanges provided for in
Section 6.1(b), the Company may terminate this Agreement by delivering notice to
Rhône of such termination; provided that, notwithstanding the foregoing, the
Company may not terminate this Agreement at any time where it is in material
breach of any of its obligations under this Agreement.
 
(b) Subject to Section 7.1(c), in the event that Rhône or any of the Lenders are
not obligated to complete the First Exchange due to the failure to satisfy the
conditions precedent to the closing of the Exchanges provided for in
Section 6.1(a), Rhône and the Lenders may terminate this Agreement by delivering
notice to the Company of such termination; provided that, notwithstanding the
foregoing, Rhône and the Lenders may not terminate this Agreement at any time
where they are in material breach of any of their obligations under this
Agreement.
 
(c) In the event of termination of this Agreement in accordance with
Section 7.1(a) or Section 7.1(b), this Agreement shall become void and of no
effect, with no liability to any Person on the part of any party hereto (or of
any of its representatives or Affiliates); provided, however, that (i) no such
termination shall relieve any party hereto of any liability or damages to the
other party hereto resulting from any material breach of this Agreement
occurring prior to such termination and (ii) the provisions set forth in
Sections 7.2 and 7.3 and Article 8 (other than Sections 8.11 and 8.13), and all
related definitions, shall survive the termination of this Agreement.
 
7.2 Termination Fee.  In the event the First Exchange fails to close due to
(i) the failure by the Company to obtain the Stockholder Approval on or prior to
September 22, 2010, and the Company prepays any portion of the outstanding
principal amount of the Term Loans within six (6) months immediately following
the earlier of (A) the date of the Special Meeting (or, if adjourned, the date
of the reconvened Special Meeting) at which the Exchanges are not approved as a
result of the negative vote of the Company’s stockholders or (B) September 22,
2010, (ii) the Board changing the Recommendation, or (iii) a material breach by
the Company of its obligations hereunder, the Company shall pay a termination
fee to Rhône, as agent for the Lenders, in an aggregate amount equal to
$10,000,000 (the “Termination Fee”). Notwithstanding anything contained herein
to the contrary, Rhône, as agent for the Lenders, will not be entitled to
receive the Termination Fee under any other circumstances and the Termination
Fee shall be the sole and exclusive remedy of Rhône and the Lenders as a result
of a termination of this Agreement by the Company pursuant to Section 7.1(a) or
by Rhône and the Lenders pursuant to Section 7.1(b). Upon the payment of the
Termination Fee pursuant to this Section 7.2, none of the Company and the
Borrowers shall have any further liability or obligation relating to or arising
out of this Agreement or the transactions contemplated by this Agreement (other
than indemnification obligations under Section 8.9 and any expense reimbursement
obligations under Section 7.3).
 
7.3 Expenses.  All reasonable and documented out-of-pocket costs and expenses
incurred by Rhône or the Lenders in connection with the Exchanges, including,
without limitation, reasonable counsel fees and the filing fees in connection
with all necessary notifications and other filings under the HSR Act shall be
borne by the Company and shall be payable by the Company no later than ten
(10) days following receipt by the Company of (i) a written notice from Rhône or
the Lenders indicating any payments due pursuant to this

A-13

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Section 7.3, and (ii) reasonably detailed documentation of the expenses for
which reimbursement is sought. For the avoidance of doubt, nothing under this
Section 7.3 or Section 2.4 shall amend the expense reimbursement obligations of
the Company under the Credit Agreements.
 

8.   MISCELLANEOUS.

 
8.1 Payment of Taxes.  The Company shall pay all transfer, stamp and other
similar taxes that may be imposed in respect of the issuance or delivery of the
Common Stock pursuant to the Exchanges.
 
8.2 Notices.  Any notice, demand or delivery to the Company or Rhône or the
Lenders authorized by this Agreement shall be sufficiently given or made when
mailed if sent by first-class mail, postage prepaid, addressed to the Company or
Rhône, as applicable, as follows:
 
If to the Company:
 
Quiksilver, Inc.
15202 Graham St.
Huntington Beach, CA 92649
Fax: (734) 477-1370
Attention: General Counsel
 

With a copy to:
 

Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue
Los Angeles, CA 90071-3144
Fax: (213) 621-5493
Attention: Brian J. McCarthy and K. Kristine Dunn
 
If to Rhône:
 
Rhône Group L.L.C.
630 Fifth Avenue, 27th Floor
New York, NY 10111
Fax: (212) 218-6789
Attention: Baudoin Lorans and M. Allison Steiner
 
With a copy to:
 

Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004-2498
Fax: (212) 558-3588
Attention: Richard A. Pollack
 
or such other address as shall have been furnished to the party giving or making
such notice, demand or delivery.
 
Any notice required to be given by the Company to the Lenders pursuant to this
Agreement shall be made by mailing by registered mail, return receipt requested,
to the Lenders at their respective addresses shown on Schedule 2.1(a) attached
hereto. Any notice that is mailed in the manner herein provided shall be
conclusively presumed to have been duly given when mailed, whether or not the
Lender receives the notice.
 
8.3 Agent.  The Lenders appoint Rhône as their agent and authorize Rhône to
bind, and take all actions in connection with this Agreement on behalf of, the
Lenders. The Company shall be entitled to rely on direction by Rhône on behalf
of any Lender for all purposes hereunder.
 
8.4 Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING, WITHOUT

A-14

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LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW
AND THE NEW YORK CIVIL PRACTICE LAWS AND RULES 327(B).
 
8.5 Submission to Jurisdiction.  EACH OF THE BORROWERS AND THE COMPANY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN
NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT
OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE STOCKHOLDERS
AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
BORROWERS AND THE COMPANY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS
IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN
SUCH FEDERAL COURT. EACH OF THE BORROWERS AND THE COMPANY AGREES THAT A FINAL
JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY OF
THE LENDERS OR RHôNE MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR THE STOCKHOLDERS AGREEMENT AGAINST ANY OF THE
COMPANY OR THE BORROWERS OR THEIR PROPERTIES IN THE COURTS OF ANY JURISDICTION.
 
8.6 Service of Process.  EACH OF THE BORROWERS AND THE COMPANY IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN
SECTION 8.2.  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY
HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
 
8.7 Waiver of Venue.  EACH OF THE BORROWERS AND THE COMPANY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED
TO IN SECTION 8.5 OF THIS AGREEMENT. EACH OF THE BORROWERS AND THE COMPANY
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.
 
8.8 Persons Benefiting.  This Agreement shall be binding upon and inure to the
benefit of the Company, the Borrowers and Rhône, and their successors, assigns,
beneficiaries, executors and administrators, and the Lenders. Nothing in this
Agreement is intended or shall be construed to confer upon any Person, other
than the Company, the Borrowers, Rhône and the Lenders, any right, remedy or
claim under or by reason of this Agreement or any part hereof.
 
8.9 Indemnification.  The Company and the Borrowers shall, jointly and
severally, indemnify Rhône, the Lenders and each of their respective agents,
attorneys, accountants, advisors, consultants, directors, officers, employees,
partners, stockholders, Affiliates and other representatives (each such Person
an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all
losses, claims, causes of action, damages, liabilities, settlement payments,
costs and related expenses (including the reasonable fees, charges and
disbursements of counsel (it being understood that the Company shall not be
liable for the fees and expenses of more than one counsel)), incurred by any
Indemnitee or asserted against any Indemnitee by any third party or by the
Company or the Borrowers arising out of, in connection with, or as a result of
(i) the execution or delivery of this Agreement or any agreement or instrument
contemplated hereby, the performance by the parties hereto of their respective
obligations hereunder or the consummation of the transactions contemplated
hereby or (ii) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or
any other theory, whether brought by a third party or by the Company or the
Borrowers or any of their directors, shareholders or creditors, and regardless
of whether any Indemnitee is a party thereto, in all cases, whether or not
caused by or arising, in whole or in part, out of the

A-15

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comparative, contributory or sole negligence of the Indemnitee; provided that
such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses are determined by
a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence, willful misconduct or bad faith of such
Indemnitee.
 
8.10 Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together constitute one and the same instrument.
 
8.11 Further Assurances.  Each party shall do and perform, or cause to be done
and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
 
8.12 Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns. No party
shall assign this Agreement or any rights or obligations hereunder.
 
8.13 Survival.  The parties agree that the covenants and agreements contained in
this Agreement and the representations and warranties of the parties contained
in Article 4 shall survive indefinitely, notwithstanding any due diligence
investigation conducted by or on behalf of Rhône or the Lenders.
 
8.14 Publicity.  The Company and Rhône each shall consult with each other prior
to issuing any press releases or making any public statement with respect to
this Agreement or the Stockholders Agreement and the transactions contemplated
hereby and thereby, and shall not issue any such press release or make any such
public statement with respect thereto unless the text of the statement shall
first have been agreed to by the parties hereto; provided, however, that Rhône
and the Lenders may make customary communications with their limited partners
and other co-investors without consulting the Company. Notwithstanding the
foregoing, Rhône, the Lenders and the Company acknowledge and agree that (i) the
Company will file a Current Report on Form 8-K with the SEC that will describe
the terms of this Agreement and the transactions contemplated hereby,
(ii) Rhône, the Lenders and certain of their Affiliates will file one or more
amendments to their Schedule 13D and a Form 4 with respect to the Exchanges that
will describe the terms of this Agreement, the transactions contemplated hereby
and the results of the Exchanges and (iii) nothing contained in this
Section 8.14 shall prohibit the Company, Rhône or the Lenders from complying
with its obligations under the federal securities laws or the rules and
regulations of the NYSE.
 
8.15 Exchange Rate.  For purposes of this Agreement, with respect to the First
Exchange Closing Date, the Standby Exchange Closing Date or the date immediately
following the closing of the Exchanges, as applicable, the Dollar equivalent of
any Euro-denominated principal amount outstanding under the European Term Loans
on such date shall be equal to the product of (i) the applicable
Euro-denominated principal amount multiplied by (ii) the Dollar to Euro exchange
rate published in The Wall Street Journal on the day immediately prior to such
date.
 
8.16 Severability.  In case any provision of this Agreement is declared invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
 
8.17 Headings.  The descriptive headings of the several Sections and
Sub-Sections of this Agreement are inserted for convenience and shall not
control or affect the meaning or construction of any of the provisions hereof.
 
8.18 Entire Agreement.  The Letter Agreement is hereby terminated and replaced
by this Agreement. This Agreement and the other agreements referred to herein
constitute the entire agreement and supersede all prior agreements, including
the Letter Agreement, and understandings, both written and oral, between the
parties with respect to the subject matter hereof.
 
8.19 Limitation of Liability.  No party to this Agreement shall be liable to any
other party for any consequential, indirect, special or incidental damages under
any provision of this Agreement or for any consequential, indirect, penal,
special or incidental damages arising out of any act or failure to act hereunder
even if that party has been advised of or has foreseen the possibility of such
damages.

A-16

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed, as of the day and year first above written.
 
QUIKSILVER, INC.
 

  By: 
    

Name:     
Title:
 
QUIKSILVER AMERICAS, INC.
 

  By: 
    

Name:     
Title:
 
MOUNTAIN & WAVE S.À R.L.
 

  By: 
    

Name:     
Title:
 
ROMOLO HOLDINGS C.V.
 

  By: 
    

Name:     
Title:
 
TRITON SPV L.P.
 

  By: 
    

Name:     
Title:

A-17

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TRITON ONSHORE SPV L.P.
 

  By: 
    

Name:     
Title:
 
TRITON OFFSHORE SPV L.P.
 

  By: 
    

Name:     
Title:
 
TRITON COINVESTMENT SPV L.P.
 

  By: 
    

Name:     
Title:
 
RHÔNE GROUP L.L.C.
 

  By: 
    

Name:     
Title:
 
 
[Signature Page to Exchange Agreement]

A-18

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Schedule 2.1(a)
 

              Number of Shares of
      Common Stock to be
 
Lender
  Issued in the First Exchange    
Romolo Holdings C.V.
c/o Numitor Governance S.à r.l.
c/o Rhône Group L.L.C.
630 5th Avenue, 27th Floor
New York, NY 10111
    1,040,634  
Triton SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
    2,081,477  
Triton Onshore SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
    6,719,935  
Triton Offshore SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
    5,600,700  
Triton Coinvestment SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
    1,223,921  
TOTAL
    16,666,667  

A-19

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Schedule 4.2(g)
 

                      Aggregate
  Aggregate
    Principal Amount of
  Principal Amount of

Lender
  US Term Loans   European Term Loans  
Romolo Holdings C.V. 
  $ 8,125,072.18     € 1,379,446.19  
Triton SPV L.P. 
  $ 16,251,768.97     € 2,759,168.20  
Triton Onshore SPV L.P. 
  $ 52,467,943.21     € 8,907,822.94  
Triton Offshore SPV L.P. 
  $ 43,729,172.47     € 7,424,185.16  
Triton Coinvestment SPV L.P. 
  $ 9,556,134.08     € 1,622,406.85  
TOTAL
  $ 130,130,090.91     € 22,093,029.34  

A-20

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Exhibit 2.6
 
 
STOCKHOLDERS AGREEMENT
by and among
QUIKSILVER, INC.,
THE INITIAL HOLDERS
and
RHÔNE CAPITAL III L.P.
Dated as of • , 2010
 

--------------------------------------------------------------------------------

 

 
TABLE OF CONTENTS
 

                                    Page       1.     DEFINITIONS     1     2.  
  TRANSFER RESTRICTIONS; COMPLIANCE WITH THE SECURITIES ACT     4           2.1.
  Transferability of the Exchange Stock     4           2.2.   Compliance with
the Securities Act     4     3.     AMENDMENT TO WARRANT AGREEMENT     5        
  3.1.   Amendment to Warrant Agreement     5     4.     [RESERVED]     6     5.
    REPRESENTATIONS AND WARRANTIES     6           5.1.   Representations and
Warranties of the Company     6           5.2.   Representations and Warranties
of Rhône, Rhône Capital and each of the Initial Holders     6     6.    
COVENANTS     7           6.1.   Standstill     7           6.2.   Board
Representation     8           6.3.   Financial Statements     9           6.4.
  Rule 144 Reporting     9           6.5.   Preemptive Rights     10          
6.6.   Consent Upon Certain Issuances     10           6.7.   Affiliate
Transactions     10     7.     MISCELLANEOUS     10           7.1.   Agent    
10           7.2.   Removal of Legends     10           7.3.   Notices     10  
        7.4.   Applicable Law     11           7.5.   Persons Benefiting     11
          7.6.   Counterparts     11           7.7.   Amendments     11        
  7.8.   Headings     12           7.9.   Entire Agreement     12          
7.10.   Limitation of Liability     12  

i

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STOCKHOLDERS AGREEMENT
 
This STOCKHOLDERS AGREEMENT (the “Agreement”) is entered into as of • , 2010 by
and among Quiksilver, Inc., a Delaware corporation (the “Company”), the Initial
Holders and Rhône Capital III L.P. (“Rhône”).
 
WITNESSETH:
 
WHEREAS, the Company, the Initial Holders and Rhône Group L.L.C. are party to
the Exchange Agreement, dated as of June • , 2010 (the “Exchange Agreement”),
pursuant to which the Initial Holders are exchanging (i) pursuant to the First
Exchange (as defined in the Exchange Agreement), on a pro rata basis,
$75,000,000 of the principal amount outstanding under the Term Loans (as defined
in the Exchange Agreement) for an aggregate of 16,666,667 shares of Common Stock
and (ii) if the Borrowers (as defined in the Exchange Agreement) have exercised
their option in respect of the Standby Exchange (as defined in the Exchange
Agreement), an additional portion of the outstanding principal amount of the
Term Loans for such additional number of shares of Common Stock as determined
under the Exchange Agreement;
 
WHEREAS, in connection with the consummation of the transactions contemplated by
the Exchange Agreement, the parties desire to enter into this Agreement in order
to create certain rights for Rhône Capital III L.P. and the Initial Holders; and
 
WHEREAS, the execution of this Agreement is an inducement and a condition
precedent to the obligations of the parties to the Exchange Agreement.
 
NOW, THEREFORE, in consideration of the mutual covenants and undertakings
contained herein and in the Exchange Agreement, as an inducement to Rhône and
the Initial Holders to consummate the transactions contemplated by the Exchange
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
 

1.   DEFINITIONS.

 
As used in this Agreement, the following terms shall have the following
meanings:
 
“ABL Agent” means Bank of America, N.A., in its capacity as administrative agent
for the lenders under the ABL Credit Agreement, together with any successor
agent.
 
“ABL Credit Agreement” means the Credit Agreement, dated as of July 31, 2009
among Quiksilver Americas, Inc., the other borrowers party thereto, the Company,
the other guarantors party thereto, the lenders party thereto, the ABL Agent,
Bank of America, N.A. and General Electric Capital Corporation, as co-collateral
agents, and the other agents party thereto, and any refinancings, refundings,
renewals or extensions thereof permitted hereunder.
 
“Affiliate” means with respect to any Person, a Person that directly or
indirectly controls, is controlled by or is under direct or indirect common
control with such Person. For purposes of this definition, “control” when used
with respect to any Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of Voting
Stock, by contract or otherwise, and the terms “controlling” and “controlled”
have meanings correlative to the foregoing.
 
“Appointing Funds” means Triton Onshore SPV L.P. and Triton Coinvestment SPV
L.P.
 
“Board” means the board of directors of the Company.
 
“Bylaws” means the Company’s Amended and Restated Bylaws, as amended from time
to time.
 
“Capital Stock” means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in
(however designated) equity of the Company, including any preferred stock but
excluding any debt securities convertible into such equity.

--------------------------------------------------------------------------------

 

“Certificate of Incorporation” means the Company’s Restated Certificate of
Incorporation, as amended from time to time.
 
“Common Stock” means the common stock, par value $0.01 per share, of the
Company.
 
“Common Stock Equivalent” means any warrant, right or option to acquire any
shares of Common Stock or any security convertible or exchangeable into shares
of Common Stock.
 
“Company” has the meaning set forth in the recitals to this Agreement and its
successors and assigns.
 
“Consolidated” means, when used to modify a financial term, test, statement, or
report of a Person, the application or preparation of such term, test, statement
or report (as applicable) based upon the consolidation, in accordance with GAAP,
of the financial condition or operating results of such Person and its
Subsidiaries.
 
“DGCL” means the Delaware General Corporation Law.
 
“Equity Interests” means with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, and
all of the warrants or options for the purchase or acquisition from such Person
of shares of capital stock of (or other ownership or profit interests in) such
Person (including partnership, member or trust interests therein), whether
voting or nonvoting.
 
“Exchanges” means the First Exchange and the Standby Exchange, each as defined
in the recitals to this Agreement.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Exchange Agreement” has the meaning set forth in the recitals to this
Agreement.
 
“Exchange Stock” means the Common Stock issued to the Holders under the Exchange
Agreement at any time during the term of this Agreement and any securities
issued or issuable with respect to any such Common Stock by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization, the exercise of
any preemptive rights under Section 6.5 of this Agreement or otherwise.
 
“Excluded Securities” means (i) the Qualifying Employee Stock, (ii) the Exchange
Stock, (iii) the shares of Common Stock or Series A Preferred Stock issuable or
issued upon the exercise of the Warrants, (iv) any shares of Common Stock or
Common Stock Equivalents issued for non-cash consideration in connection with
any merger, consolidation, acquisition or similar business combination, (v) any
shares of Common Stock issued pursuant to the commitments disclosed on
Schedule 8.1 of the Warrant Agreement and (vi) any shares of Common Stock or
Common Stock Equivalents issued in connection with any joint venture, licensing,
development or sponsorship activities in the ordinary course of business.
 
“French Credit Agreement” means the Facilities Agreement, dated as of July 31,
2009, among, inter alia, Pilot SAS, a Société par Actions Simplifiée, and Na
Pali, a Société par Actions Simplifiée, as borrowers, the Parent and Pilot SAS,
as original guarantors, and Crédit Lyonnais, BNP Paribas and Société Générale
Corporate & Investment Banking, as mandated lead arrangers, as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time.
 
“Fiscal Month” means any fiscal month of any Fiscal Year, which month shall
generally end on the last day of each calendar month in accordance with the
fiscal accounting calendar of the Company.
 
“Fiscal Quarter” means any fiscal quarter of any Fiscal Year, which quarters
shall generally end on the last day of each January, April, July and October of
such Fiscal Year in accordance with the fiscal accounting calendar of the
Company.
 
“Fiscal Year” means any period of 12 consecutive months ending on
October 31st of any calendar year.

2

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“GAAP” means generally accepted accounting principles in the United States set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
 
“Holders” means the Initial Holders and any assignee or transferee of such
Initial Holders and, unless otherwise provided or indicated herein, the holders
of the Exchange Stock.
 
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations promulgated thereunder.
 
“Initial Holders” means each of (i) Romolo Holdings C.V., (ii) Triton SPV L.P.,
(iii) Triton Onshore SPV L.P., (iv) Triton Offshore SPV L.P. and (v) Triton
Coinvestment SPV L.P.
 
“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, liabilities, or
condition (financial or otherwise) of the Company taken as a whole; (b) a
material impairment of the ability of the Company to perform its obligations
under this Agreement; or (c) a material impairment of the rights and remedies of
Rhône, the Initial Holders and/or Rhône Group L.L.C., as applicable, under the
Credit Agreements (for so long as the Credit Agreements will remain outstanding
after giving effect to the Exchanges), the Warrant Agreement, this Agreement or
the Exchange Agreement.
 
“Permitted Transaction” means any acquisition of any Common Stock or Common
Stock Equivalent (i) by Rhône or any of its Affiliates (including, for the
avoidance of doubt, any partner or employee of Rhône then serving on the Board)
directly from the Company or (ii) made pursuant to a tender or exchange offer
made to all stockholders of the Company.
 
“Permitted Transfer” means any transfer (i) to any Affiliate of Rhône or Rhône
Group L.L.C. (including, for the avoidance of doubt, any entity controlled by
Rhône or Rhône Group L.L.C.) or in a pro rata distribution to the partners of a
fund controlled by Rhône or Rhône Group L.L.C., (ii) in an underwritten public
offering, other broad distribution sale (including, without limitation, a sale
pursuant to Rule 144) or open-market transaction, (iii) to any Person in
connection with an offer by such Person to purchase 100% of the Common Stock
then outstanding or (iv) to any Person of a number of shares of the Exchange
Stock representing no greater than 15% of the then-outstanding number of shares
of Common Stock.
 
“Person” means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
 
“Qualifying Employee Stock” has the meaning set forth in the Warrant Agreement.
 
“Rhône” has the meaning set forth in the recitals to this Agreement.
 
“Rhône Director” means a director nominated by an Appointing Fund.
 
“Rule 144, Rule 405 and Rule 415” mean, in each case, such rule promulgated
under the Securities Act (or any successor provision), as the same shall be
amended from time to time.
 
“SEC” means the United States Securities and Exchange Commission.
 
“Securities Act” means the Securities Act of 1933, as amended.
 
“Series A Preferred Stock” means the convertible non-voting preferred stock, par
value $0.01 per share, of the Company on the terms set forth in Exhibit C of the
Warrant Agreement.
 
“Standstill Period” means the period commencing on the date hereof and
continuing until such time as the restrictions set forth in Section 6.1(a)
terminate in accordance with the terms of Section 6.1(c).
 
“Stockholder Approval” has the meaning set forth in the Exchange Agreement.

3

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“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
Equity Interests having ordinary voting power for the election of directors or
other governing body are at the time beneficially owned, or the management of
which is otherwise controlled, directly, or indirectly through one or more
intermediaries, or both, by such Person.
 
“Voting Stock” means all classes of Capital Stock of the Company then
outstanding and normally entitled to vote in the election of directors.
 
“Warrant Agreement” means the Warrant and Registration Rights Agreement, dated
as of July 31, 2009, by and among the Company, Rhône and the initial Warrant
holders party thereto.
 
“Warrants” means the warrants issued by the Company from time to time pursuant
to the Warrant Agreement.
 

2.   TRANSFER RESTRICTIONS; COMPLIANCE WITH THE SECURITIES ACT.

 
2.1 Transferability of the Exchange Stock.  The Exchange Stock may not be
transferred to any Person, other than (i) with the prior written consent of the
Company or (ii) pursuant to a Permitted Transfer (subject, in the case of a
Permitted Transfer, to compliance with Section 2.2).
 
2.2 Compliance with the Securities Act.
 
(a) The Exchange Stock may be transferred to any Person pursuant to a Permitted
Transfer, provided that such transfer shall be in compliance with this
Section 2.2.
 
(b) A Holder may sell its Exchange Stock to a transferee that is an “accredited
investor” as such term is defined in Regulation D under the Securities Act,
provided that each of the following conditions is satisfied:
 
(i) with respect to any “accredited investor” that is not an institution, such
transferee, as the case may be, provides certification establishing to the
reasonable satisfaction of the Company that it is an “accredited investor”;
 
(ii) such transferee represents that it is acquiring the Exchange Stock for its
own account and that it is not acquiring such Exchange Stock with a view to, or
for offer or sale in connection with, any distribution thereof (within the
meaning of the Securities Act) that would be in violation of the securities laws
of the United States or any applicable state thereof, but subject, nevertheless,
to the disposition of its property being at all times within its control; and
 
(iii) such Holder or transferee agrees to be bound by the provisions of this
Section 2 with respect to any sale of the Exchange Stock.
 
(c) A Holder may sell its Exchange Stock in accordance with Regulation S under
the Securities Act.
 
(d) A Holder may sell its Exchange Stock to a transferee if:
 
(i) such Holder gives written notice to the Company of its intention to effect
such sale, which notice shall describe the manner and circumstances of the
proposed transaction in reasonable detail;
 
(ii) such notice includes a certification by the Holder to the effect that such
proposed sale may be effected without registration under the Securities Act or
under applicable Blue Sky laws; and
 
(iii) such transferee complies with Sections 2.2(b)(ii) and 2.2(b)(iii).
 
(e) Except for a sale in accordance with Section 2.2(f) and subject to
Section 7.2, each certificate representing the Exchange Stock held by any Holder
shall be stamped or otherwise imprinted with a legend substantially in the
following form (in addition to any legend required under applicable law or other
agreement):
 
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER

4

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APPLICABLE STATE SECURITIES LAWS. SUCH SHARES MAY BE OFFERED, SOLD OR
TRANSFERRED ONLY IN COMPLIANCE WITH THE REQUIREMENTS OF SUCH ACT AND OF ANY
APPLICABLE STATE SECURITIES LAWS AND SUBJECT TO THE PROVISIONS OF THE
STOCKHOLDERS AGREEMENT DATED AS OF [ • ], 2010 BY AND AMONG THE COMPANY, RHôNE
CAPITAL III L.P. AND THE INITIAL HOLDERS PARTY THERETO. A COPY OF THE
STOCKHOLDERS AGREEMENT IS AVAILABLE AT THE OFFICES OF THE COMPANY.
 
(f) A Holder may sell its Exchange Stock in a transaction that is registered
under the Securities Act.
 

3.   AMENDMENT TO WARRANT AGREEMENT

 
3.1 Amendment to Warrant Agreement.  The Warrant Agreement is hereby amended as
follows:
 
(a) Article I of the Warrant Agreement is hereby amended by inserting the
following two defined terms between the defined terms “Exchange Act” and
“Excluded Securities”:
 
“Exchange Agreement:  the Exchange Agreement, dated as of June 24, 2010, by and
among the Company, Quiksilver Americas, Inc., Mountain & Wave S.à r.l., Rhône
Group L.L.C. and the Initial Warrant Holders.
 
Exchange Stock:  the Common Stock issued to the Holders under the Exchange
Agreement at any time during the term of the Stockholders Agreement and any
securities issued or issuable with respect to any such Common Stock by way of
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization, the exercise of
any preemptive rights under Section 6.5 of the Stockholders Agreement or
otherwise.”
 
(b) Only with respect to Article 4 of the Warrant Agreement, but excluding
Section 4.11 thereof, the definition of “Registrable Securities” as set forth in
Article I of the Warrant Agreement is hereby amended in its entirety to read as
follows:
 
“Registrable Securities:  Any (i) Common Stock, Series A Preferred Stock or
other securities issuable under the Warrants to the Initial Warrant Holders on
the Issuance Date and at any time during the term of this Agreement, including,
without limitation, (x) any shares of Common Stock issued in connection with the
exercise of any preemptive rights under Section 5.6 of this Agreement and
(y) any securities issued with respect to the Common Stock, Series A Preferred
Stock or other securities issuable under the Warrants in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization, (ii) Exchange Stock issued pursuant to the Exchange Agreement,
and (iii) Qualifying Employee Stock issued to the Rhône Directors. Registrable
Securities shall continue to be Registrable Securities until (x) they are sold
pursuant to an effective Registration Statement under the Securities Act,
(y) they may be sold by their holder pursuant to Rule 144 without limitation
thereunder on volume or manner of sale, or (z) they shall have otherwise been
transferred and new securities not subject to transfer restrictions under any
federal securities laws and not bearing any legend restricting further transfer
shall have been delivered by the Company, all applicable holding periods shall
have expired, and no other applicable and legally binding restriction on
transfer by the Holder thereof shall exist.”
 
(c) Article I of the Warrant Agreement is hereby amended by inserting the
following defined term between the defined terms “Series A Preferred Stock” and
“Total Cap”:
 
“Stockholders Agreement:  the Stockholders Agreement, dated as of [ • ], 2010,
by and among the Company, Rhône Capital III and the Initial Holders.”
 
(d) The first sentence of Section 4.01(b) of the Warrant Agreement is hereby
amended in its entirety to read as follows:
 
“Rhône Capital III shall be entitled to request, in the aggregate, five Demand
Registrations; provided that if at any time during the term of the Stockholders
Agreement (i) the Company fails to

5

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nominate any Rhône Director (as defined in the Stockholders Agreement) or to
vote any of its proxies in favor of any Rhône Director (as defined in the
Stockholders Agreement) or (ii) the stockholders of the Company fail to elect
any Rhône Director (as defined in the Stockholders Agreement), then Rhône
Capital III shall be entitled to request, in the aggregate, seven Demand
Registrations.”
 

4.   [RESERVED]

 

5.   REPRESENTATIONS AND WARRANTIES.

 
5.1 Representations and Warranties of the Company.  The Company hereby
represents and warrants that:
 
(a) Existence, Power and Ownership.  It is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
 
(b) Authorization.  It has the corporate power and authority to enter into this
Agreement and to perform its obligations under, and consummate the transactions
contemplated by, this Agreement and has by proper action duly authorized the
execution and delivery of this Agreement.
 
(c) No Conflicts.  None of the execution and delivery of this Agreement by the
Company, the consummation of the transactions contemplated herein or the
performance of and compliance with the terms and provisions hereof will:
(i) violate or conflict with any provision of the Certificate of Incorporation
or the Bylaws; (ii) violate any law, regulation, order, writ, judgment,
injunction, decree or permit applicable to it; (iii) violate or materially
conflict with any contractual provisions of, or cause an event of default under,
any material indenture, loan agreement, mortgage, deed of trust, contract or
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound; or (iv) result in or require the creation of any
lien, security interest or other charge or encumbrance (other than those
contemplated in or in connection with this Agreement) upon or with respect to
its properties, except in the case of clauses (ii), (iii) and (iv), for such
violations, conflicts, defaults, or liens, security interests or encumbrances
that would not, individually or in the aggregate, result in a Material Adverse
Effect.
 
(d) Consents.  Except as otherwise provided or contemplated by this Agreement,
and subject to the accuracy of the representations and warranties of Rhône and
the Initial Holders, no consent, approval, authorization or order of, or filing,
registration or qualification with, any court or governmental authority or other
Person is required in connection with the execution, delivery or performance of
this Agreement.
 
(e) Enforceable Obligations.  This Agreement has been duly executed and
delivered by the Company and, assuming due authorization, execution and delivery
hereof by the Initial Holders and Rhône, constitutes a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms subject, as to enforcement, to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights and to general equity principles.
 
5.2 Representations and Warranties of Rhône, Rhône Capital and each of the
Initial Holders.  Rhône and each of the Initial Holders, severally and not
jointly, hereby represents and warrants that:
 
(a) Authorization.  Rhône and each of the Initial Holders has the corporate,
limited partnership or limited liability company, as the case may be, power and
authority to enter into this Agreement and to perform its obligations under, and
consummate the transactions contemplated by, this Agreement and has by proper
action duly authorized the execution and delivery of this Agreement.
 
(b) Enforceable Obligations.  This Agreement has been duly executed and
delivered by Rhône and each of the Initial Holders and assuming due
authorization, execution and delivery hereof by the Company, this Agreement
constitutes a legal, valid and binding obligation of Rhône and each of the
Initial Holders, enforceable in accordance with its terms subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors’ rights and to general equity principles.

6

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(c) Investment Intent.  Each Initial Holder acknowledges that the Exchange Stock
will not have been, at the time of issuance, registered under the Securities Act
or under any state securities laws. Each Initial Holder (i) is acquiring the
Exchange Stock pursuant to an exemption from registration under the Securities
Act and solely for investment with no present intention to distribute any of the
securities to any Person in violation of the Securities Act or any other
applicable securities laws and (ii) will not sell or otherwise dispose of any of
such Exchange Stock, except in compliance with the registration requirements or
exemption provisions of the Securities Act and any other applicable securities
laws.
 
(d) Accredited Investor Status.  (i) Each Initial Holder is an “accredited
investor” as such term is defined in Rule 501(a) promulgated under the
Securities Act whose knowledge and experience in financial and business matters
are such that each Initial Holder is capable of evaluating the merits and risks
of its investment in the shares of Exchange Stock and (ii)(A) each Initial
Holder’s financial situation is such that each Initial Holder can afford to bear
the economic risk of holding the shares of Exchange Stock for an indefinite
period of time, (B) each Initial Holder can afford to suffer complete loss of
its investment in shares of Exchange Stock, (C) the Company has made available
to each Initial Holder all documents and information that each Initial Holder
has requested relating to an investment in the Company and (D) each Initial
Holder has had adequate opportunity to ask questions of, and receive answers
from, the Company as well as the Company’s officers, employees, agents and other
representatives concerning the Company’s business, operations, financial
condition, assets, liabilities and all other matters relevant to each Initial
Holder’s investment in the shares of Exchange Stock.
 

6.   COVENANTS.

 
6.1 Standstill.
 
(a) Except as provided in Section 6.1(b), and subject to Section 6.1(c), during
the Standstill Period, none of Rhône or its Affiliates (including, for the
avoidance of doubt, the Initial Holders) shall, without the prior written
consent of the Board (excluding the Rhône Directors), directly or indirectly:
 
(i) effect or seek, offer or propose (whether publicly or otherwise) to effect
or announce any intention to effect or cause or participate in, (A) any
acquisition of Common Stock or Common Stock Equivalents if, as a result of any
such acquisition, any of Rhône or its Affiliates (including, for the avoidance
of doubt, the Initial Holders), individually or as part of a “group” (within the
meaning of Section 13(d) of the Exchange Act), would become the beneficial owner
(as defined in Rule 13(d) of the Exchange Act, except that the applicable
Person(s) or group shall be deemed to have “beneficial ownership” of all shares
that such Person(s) or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), of more than 34.99%
of the total voting power of the Voting Stock, (B) any tender or exchange offer
or merger involving the Company or (C) any “solicitation” of “proxies” (as such
terms are used in the proxy rules of the SEC) or written consents with respect
to any Voting Stock of the Company, in each case in order to elect directors to
the Board (other than any solicitation of proxies to elect any Rhône Director
who has not been nominated by the Board and/or elected by the stockholders of
the Company), or
 
(ii) join, form or participate in any “group” (within the meaning of
Section 13(d) of the Exchange Act), if such group would, as a result, become the
beneficial owner (as defined in Rule 13(d) of the Exchange Act, except that such
group shall be deemed to have “beneficial ownership” of all shares that such
group has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), of more than 34.99% of the total voting power
of the Voting Stock.
 
(b) Section 6.1(a) shall not prevent any direct or indirect acquisition (or
participation in a “group” consisting solely of Rhône and any of its Affiliates
with resulting beneficial ownership of more than 34.99% of the total voting
power of the Voting Stock (determined in accordance with Section 6.1(a)(ii)) by
Rhône or any of its Affiliates during the Standstill Period of (i) the Exchange
Stock, (ii) the shares of Common Stock or Series A Preferred Stock issuable or
issued upon the exercise of the Warrants or in connection with the exercise of
any preemptive rights under Section 5.6 of the Warrant Agreement, (iii) any
Qualifying Employee

7

--------------------------------------------------------------------------------

 

Stock issued to the Rhône Directors or (iv) any Common Stock or Common Stock
Equivalents acquired pursuant to a Permitted Transaction.
 
(c) If at any time during the term of this Agreement (i) the Company fails to
nominate any Rhône Director or to vote any of its proxies in favor of any Rhône
Director, (ii) the stockholders of the Company fail to elect any Rhône Director,
(iii) a “change in control”, “change of control” or similar concept shall have
occurred under any indenture, loan agreement, mortgage, deed of trust, contract
or other agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries or any of their
properties may be bound (other than as a result of Rhône breaching its
obligations under Section 6.1(a)) or (iv) Rhône and its Affiliates (including,
for the avoidance of doubt, the Initial Holders), individually or as part of a
“group” (within the meaning of Section 13(d) of the Exchange Act), are the
beneficial owner (as defined in Rule 13(d) of the Exchange Act, except that the
applicable Person(s) or group shall be deemed to have “beneficial ownership” of
all shares that such Person(s) or group has the right to acquire, whether such
right is exercisable immediately or only after the passage of time) of less than
20% of the outstanding Common Stock of the Company on a fully-diluted basis,
then the restrictions set forth in Section 6.1(a) shall permanently terminate.
 
6.2 Board Representation.
 
(a) Subject to Section 6.2(c) and Section 6.2(e), in connection with each
meeting of stockholders at which directors are to be elected to serve on the
Board, the Company shall take all necessary steps to nominate each Rhône
Director (or such alternative persons who are proposed by the Appointing Funds
and notified to the Company on or prior to any date set forth in the Company’s
constituent documents or applicable law for stockholder nominees) and to use its
reasonable best efforts to cause the Board unanimously to recommend that the
stockholders of the Company vote in favor of each Rhône Director for election to
the Board. If, for any reason, a candidate designated as a Rhône Director is
determined to be unqualified to serve on the Board, the Appointing Fund shall
have the right to designate an alternative Rhône Director to be so nominated.
 
(b) Each elected Rhône Director will hold his or her office as a director of the
Company for such term as is provided in the Company’s constituent documents or
until his or her death, resignation or removal from the Board or until his or
her successor has been duly elected and qualified in accordance with the
provisions of this Agreement, the Company’s constituent documents and applicable
law. If any Rhône Director ceases to serve as a director of the Company for any
reason during his or her term, the Company will use its reasonable best efforts
to cause the Board to fill the vacancy created thereby with a replacement
designated by the applicable Appointing Fund.
 
(c) The Appointing Funds shall each have the right to designate a Rhône Director
pursuant to Section 6.2(a) until such time as the Initial Holders have sold
331/3% of the Exchange Stock to any Person or Persons other than Affiliates of
Rhône or other Initial Holders. Thereafter, Triton Onshore SPV L.P. shall have
the right to designate one Rhône Director pursuant to Section 6.2(a) until such
time as the Initial Holders have sold 662/3% of the Exchange Stock to any Person
or Persons other than Affiliates of Rhône or other Initial Holders. Thereafter,
the right of Triton Onshore SPV L.P. to designate a Rhône Director hereunder
shall terminate.
 
(d) The Company shall provide the same compensation and rights and benefits of
indemnity to the Rhône Directors as are provided to other non-employee
directors.
 
(e) Nothing in this Section 6.2 shall prevent the Board from acting in
accordance with its fiduciary duties or applicable law or from acting in good
faith in accordance with its constituent documents, while giving due
consideration to the intent of this Agreement. The Board shall have no
obligation to appoint or nominate any Rhône Director upon written notice that
such appointment or nomination would violate applicable law or result in a
breach by the Board of its fiduciary duties to its stockholders; provided,
however, that the foregoing shall not affect the right of the Appointing Funds
to designate an alternate Rhône Director.

8

--------------------------------------------------------------------------------

 

(f) For so long as any directors designated by the Appointing Funds (or an
Affiliate of an Appointing Fund) pursuant to Section 9.4 of the Warrant
Agreement have been appointed to, and serve on, the Board, then such directors
shall be considered “Rhône Directors” for purposes of this Agreement.
 
6.3 Financial Statements.  For so long as Rhône and any of its Affiliates
collectively own at least 8,333,334 shares of the Exchange Stock, the Company
shall deliver to Rhône (for distribution to each Holder):
 
(a) within ninety (90) days after the end of each Fiscal Year of the Company, a
Consolidated balance sheet of the Company and its Subsidiaries as at the end of
such Fiscal Year, and the related Consolidated statements of income or
operations and cash flows for such Fiscal Year, setting forth in each case in
comparative form the figures for the previous Fiscal Year, all prepared in
accordance with GAAP, such Consolidated statements to be audited and accompanied
by a report and opinion of a registered public accounting firm of nationally
recognized standing or otherwise reasonably acceptable to Rhône, which report
and opinion shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any “going concern” or like qualification
or exception or any qualification or exception as to the scope of such audit;
 
(b) within forty-five (45) days after the end of each of the first three Fiscal
Quarters of each Fiscal Year of the Company, a Consolidated balance sheet of the
Company and its Subsidiaries as at the end of such Fiscal Quarter, and the
related Consolidated statements of income or operations and cash flows for such
Fiscal Quarter and for the portion of the Company’s Fiscal Year then ended,
setting forth in each case in comparative form the figures for (i) such period
set forth in the projections delivered pursuant to Section 6.3(d) hereof (if
applicable), (ii) the corresponding Fiscal Quarter of the previous Fiscal Year
and (iii) the corresponding portion of the previous Fiscal Year, such
Consolidated statements to be certified by a responsible officer of the Company
as fairly presenting the financial condition, results of operations and cash
flows of the Company and its Subsidiaries as of the end of such Fiscal Quarter
in accordance with GAAP, subject only to normal year-end audit adjustments and
the absence of footnotes;
 
(c) within thirty (30) days after the end of each of the first two Fiscal Months
of each Fiscal Quarter of the Company, a financial report for the immediately
preceding Fiscal Month in a format reasonably satisfactory to Rhône;
 
(d) no later than within thirty (30) days prior to the end of each Fiscal Year,
a copy of the approved annual budget of the Company and its Subsidiaries for the
immediately following Fiscal Year; and
 
(e) (i) copies of any reports and other written information delivered to the
administrative agent under the ABL Credit Agreement and any agent under the
French Credit Agreement and (ii) upon the request of Rhône, copies of any
reports and other written information delivered to the lenders or their
respective agents under the credit facilities of certain Subsidiaries of the
Company organized in Japan and Australia.
 
6.4 Rule 144 Reporting.  With a view to making available to the Holders the
benefits of certain rules and regulations of the SEC which may permit the sale
of the Exchange Stock to the public without registration, the Company agrees, so
long as it is subject to the periodic reporting requirements of the Exchange
Act, to use commercially reasonable efforts to:
 
(a) make and keep public information available, as those terms are understood
and defined in Rule 144(c)(1) or any similar or analogous rule promulgated under
the Securities Act, at all times after the effective date of this Agreement;
 
(b) file with the SEC, in a timely manner, all reports and other documents
required of the Company under the Exchange Act; and
 
(c) so long as Rhône and any of its Affiliates collectively own at least
8,333,334 shares of the Exchange Stock, furnish to such Holders forthwith upon
request: (i) in the event the Company is no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, a written statement by
the Company as to its compliance with the reporting requirements of Rule 144
under the Securities Act and of the Exchange Act; (ii) in the event the Company
is subject to the reporting

9

--------------------------------------------------------------------------------

 

requirements of Section 13 or 15(d) of the Exchange Act, a copy of the most
recent annual or quarterly report of the Company; and (iii) such other reports
and documents as the Holders may reasonably request in availing themselves of
any rule or regulation of the SEC allowing them to sell any such securities
without registration.
 
6.5 Preemptive Rights.  So long as Rhône and any of its Affiliates collectively
own at least 8,333,334 shares of the Exchange Stock, upon any issuance for cash
of any shares of Common Stock, rights or options to acquire Common Stock or
securities convertible or exchangeable into Common Stock for cash, any Initial
Holder or any of their Affiliates shall have additional subscription rights
allowing such Initial Holder or Affiliate to maintain its proportionate
ownership interest in the Company based on the ratio of (i) the Exchange Stock
issued to or transferred to, and owned by, such Initial Holder or Affiliate
(which, for this purpose, shall be calculated taking into account any Exchange
Stock subsequently transferred to such Initial Holder or Affiliate by another
Initial Holder or Affiliate) and (ii) the number of shares of Common Stock
outstanding immediately prior to such issuance, without giving effect to any
Warrants or the shares of Common Stock held by the Initial Holders or any of
their Affiliates. The foregoing shall not apply to any issuance of Excluded
Securities. For the avoidance of doubt, notwithstanding this Section 6.5, the
preemptive rights set forth in Section 5.6 of the Warrant Agreement shall remain
in effect.
 
6.6 Consent Upon Certain Issuances.  So long as Rhône and any of its Affiliates
collectively own at least 8,333,334 shares of the Exchange Stock, the Company
shall not, without the prior written consent of Rhône in its sole discretion,
issue shares of Common Stock (other than (i) issuances of Excluded Securities or
(ii) issuances of Common Stock that are contemporaneously being sold pursuant to
a bona fide underwritten public offering), at a price less than the lesser of
(A) $4.50 per share of Common Stock and (B) the fair market value of the Common
Stock.
 
6.7 Affiliate Transactions.  So long as Rhône and any of its Affiliates
collectively own at least 8,333,334 shares of the Exchange Stock, any issuance
by the Company of any shares of Common Stock to, or repurchase by the Company of
any shares of Common Stock from, any Affiliate, other than Excluded Securities,
shall be on terms no less favorable to the Company than those obtainable by a
party who is not an Affiliate.
 

7.   MISCELLANEOUS.

 
7.1 Agent.  The Holders appoint Rhône as their agent and authorize Rhône to
bind, and take all actions in connection with this Agreement on behalf of, the
Holders, including agreeing to amendments of this Agreement pursuant to
Section 7.7 herein. The Company shall be entitled to rely on direction by Rhône
on behalf of any Holder for all purposes hereunder.
 
7.2 Removal of Legends.  In the event (i) the Exchange Stock is registered under
the Securities Act or (ii) the Company is presented with an opinion of counsel
reasonably satisfactory to the Company that transfers of the Exchange Stock do
not require registration under the Securities Act, the Company shall direct its
transfer agent, and the transfer agent shall, upon surrender by a Holder of its
certificates evidencing such Exchange Stock, exchange such certificates for
certificates without the legends referred to in Section 2.2(e).
 
7.3 Notices.  Any notice, demand or delivery to the Company or Rhône authorized
by this Agreement shall be sufficiently given or made when mailed if sent by
first-class mail, postage prepaid, addressed to the Company or Rhône, as
applicable, as follows:
 
If to the Company:
 
Quiksilver, Inc.
15202 Graham St.
Huntington Beach, CA 92649
Fax: (734) 477-1370
Attention: General Counsel

10

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With a copy to:
 
Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue
Los Angeles, CA 90071-3144
Fax: (213) 621-5493
Attention: Brian J. McCarthy and K. Kristine Dunn
 
If to Rhône:
 
Rhône Capital III L.P.
630 Fifth Avenue, 27th Floor
New York, NY 10111
Fax: (212) 218-6789
Attention: Baudoin Lorans and M. Allison Steiner
 
With a copy to:
 
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004-2498
Fax: (212) 291-9116
Attention: Richard A. Pollack
 
or such other address as shall have been furnished to the party giving or making
such notice, demand or delivery.
 
Any notice required to be given by the Company to the Holders pursuant to this
Agreement shall be made by mailing by registered mail, return receipt requested,
to the Holders at their respective addresses shown on the register of the
Company or, if any such Holder is an Initial Holder, to its respective address
shown on Schedule I attached hereto. Any notice that is mailed in the manner
herein provided shall be conclusively presumed to have been duly given when
mailed, whether or not the Holder receives the notice.
 
7.4 Applicable Law.  This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, including, without
limitation, Section 5-1401 of the New York General Obligations Law.
 
7.5 Persons Benefiting.  This Agreement shall be binding upon and inure to the
benefit of the Company and Rhône, and their successors, assigns, beneficiaries,
executors and administrators, and the Holders from time to time. Nothing in this
Agreement is intended or shall be construed to confer upon any Person, other
than the Company, Rhône and the Holders, any right, remedy or claim under or by
reason of this Agreement or any part hereof.
 
7.6 Counterparts.  This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which together constitute
one and the same instrument.
 
7.7 Amendments.
 
(a) Neither this Agreement nor any provisions hereof shall be waived, modified,
changed, discharged or terminated other than in accordance with Section 7.7(b).
 
(b) With the consent of Rhône, the Company may from time to time (i) supplement
or amend this Agreement to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any other
provisions herein, or to make any other provisions with regard to matters or
questions arising hereunder and (ii) modify the Agreement for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or modifying in any manner the rights of the
Holders hereunder.

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7.8 Headings.  The descriptive headings of the several Articles and Sections of
this Agreement are inserted for convenience and shall not control or affect the
meaning or construction of any of the provisions hereof.
 
7.9 Entire Agreement.  This Agreement and the other agreements referred to
herein constitute the entire agreement and supersede all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof.
 
7.10 Limitation of Liability.  No party to this Agreement shall be liable to any
other party for any consequential, indirect, special or incidental damages under
any provision of this Agreement or for any consequential, indirect, penal,
special or incidental damages arising out of any act or failure to act hereunder
even if that party has been advised of or has foreseen the possibility of such
damages.

12

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed, as of the day and year first above written.
 
QUIKSILVER, INC.
 

  By: 
    

Name:     
Title:
 
ROMOLO HOLDINGS C.V.
 

  By: 
    

Name:     
Title:
 
TRITON SPV L.P.
 

  By: 
    

Name:     
Title:
 
TRITON ONSHORE SPV L.P.
 

  By: 
    

Name:     
Title:
 
TRITON OFFSHORE SPV L.P.
 

  By: 
    

Name:     
Title:

13

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TRITON COINVESTMENT SPV L.P.
 

  By: 
    

Name:     
Title:
 
RHÔNE CAPITAL III L.P.
 

  By: 
    

Name:     
Title:
 
[Signature Page to Stockholder Agreement]

14

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Schedule I
 
Notice Addresses of Initial Holders
 
Romolo Holdings C.V.
c/o Numitor Governance S.à r.l.
c/o Rhône Group L.L.C.
630 5th Avenue, 27th Floor
New York, NY 10111
 
Triton SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
 
Triton Onshore SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
 
Triton Offshore SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111
 
Triton Coinvestment SPV L.P.
c/o Triton GP SPV LLC
c/o Rhône Capital III L.P.
630 5th Avenue, 27th Floor
New York, NY 10111

15