A brown-out is a short dip in the power supply. Many microcontrollers have brown-out detection on-chip, often, like in the Atmel AVR, with programmable threshold levels. When a brown-out occurs the microcontroller will be reset.
This may seem a bit drastic, but it's a question of reliability, and safety. If just one of those thousand of gates would lock due to a too low voltage it may lock up the complete controller, or have it go bananas, that it still runs, but produces nonsensical results and performs ditto actions. You don't want that, especially not where the microcontroller controls industrial equipment. That's why a brown-out situation always has to be responded to predictably. The DAC does this by shutting the outputs off, which you can expect to be the least harmful behavior.