Material Agreement Form 8 K

Item 1.01 Entry into a Material Definitive Agreement.

On September 5, 2024 (the "Effective Date"), Unifi Manufacturing, Inc., a beneficially owned subsidiary of Unifi, Inc. (the "Company"), and certain of its domestic affiliates (collectively, the "Borrowers"), as borrowers, entered into a First Amendment ("First Amendment") to Second Amended and Restated Credit Agreement dated October 28, 2022 (the "Credit Agreement").

The Credit Agreement, prior to the First Amendment, included a $230.0 million senior secured credit facility (the "ABL Facility") with Wells Fargo Bank, National Association ("Wells Fargo"), as administrative agent, sole lead arranger and sole book runner, and Wells Fargo; Bank of America, N.A; and First National Bank, as lenders. The ABL Facility consisted of a $115.0 million revolving credit facility (the "ABL Revolver") and a $115.0 million term loan (the "ABL Term Loan"). The ABL Facility has a maturity date of October 28, 2027.

The First Amendment primarily (i) permits the sale of a Company-owned real estate asset (consisting of an industrial warehouse building and land acreage) located in Yadkinville, North Carolina with application of the net proceeds to reduce the outstanding ABL Revolver balance, in lieu of the prescribed mandatory prepayment to the ABL Term Loan; (ii) reduces the Maximum Revolver Amount from $115.0 million to $80.0 million; (iii) modifies the definition of the Trigger Level as of any date of determination to the greater of (a) $16,500,000 and (b) 10% of the sum of (i) the Maximum Revolver Amount plus (ii) the outstanding principal amount of the ABL Term Loan on such date of determination; (iv) increases the range of the Applicable Margin on (a) SOFR-based loans to a new range of 1.50% to 2.00% and (b) Base Rate-based loans to a new range of 0.50% to 1.00%, with such new ranges of Applicable Margin rates becoming immediately effective and continuing until the Company achieves a Fixed Charge Coverage Ratio of 1.05 to 1.00 or better; (v) for a Term Loan Reset, establishes an additional requirement to obtain lender approval; and (vi) modifies certain terms and conditions of the Credit Agreement including, but not limited to, Swing Loans, Letter of Credit Sublimits, and costs related to normal course collateral valuations for the ABL Facility.

In connection with the First Amendment, the Company paid the lenders an aggregate fee of $195,000.

On the Effective Date, the ABL Term Loan had an outstanding balance of $98.9 million.

Certain capitalized terms used but not defined herein have the meanings given to them in the Credit Agreement and the First Amendment. The foregoing description of the First Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the First Amendment, a copy of which is filed as Exhibit 4.1 hereto and is incorporated by reference herein.