Exhibit 10.4

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into on the 2nd day
of November, 2020 (the “Signature Date”), by and between Lucas de Carvalho Rocha
(“Executive”) and Unifi, Inc. (the “Employer” and, collectively with its
successors, subsidiaries and affiliated companies, the “Company”).

WHEREAS, the Employer desires to retain the services of Executive on the terms
and subject to the conditions set forth in this Agreement;

 

NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:

 

1.Employment. Subject to the terms and conditions of this Agreement, the
Employer agrees to continue to employ Executive, and Executive agrees to
continue to be employed by the Employer pursuant to the terms of this Agreement,
the effective date of which is July 1, 2020 (the “Effective Date”).

 

2.Position. During the period of his employment hereunder, Executive agrees to
serve the Company, and the Employer shall employ Executive, as Executive Vice
President. If appointed or elected, Executive also shall serve as an officer,
director and/or manager of one or more of the Employer’s subsidiaries and
affiliated companies in such capacity or capacities as may be determined from
time to time.

 

 

3.

At-Will Employment and Duties.

 

(a)

At-Will Employment. Executive and the Employer agree that Executive’s employment
by the Employer hereunder will be at-will (as defined under applicable law), and
may be terminated at any time, for any reason, at the option of either party,
subject to the provisions of this Agreement.

 

 

(b)

Duties. During the period of his employment hereunder and except for illness,
reasonable vacation periods, and reasonable leaves of absence, Executive shall
in good faith devote all of his business time, attention, skill and efforts to
the business and affairs of the Company. Executive’s duties shall be performed
under the supervision of the Employer’s principal executive officer or any
delegate such officer selects. The foregoing shall not be construed as
prohibiting Executive from serving on corporate, civic or charitable boards or
committees or making personal investments, so long as such activities do not
materially interfere with the performance of Executive’s obligations to the
Company as set forth herein.

 

 

 

4.

Salary; Bonus; Reimbursement of Expenses; Other Benefits.

 

(a)

Salary. In consideration of the services to be rendered by Executive pursuant to
this Agreement, the Employer shall pay, or cause to be paid by any applicable
affiliate or subsidiary, to Executive a base salary (the “Base Salary”) as
established by or pursuant to authority granted by the Employer’s board of
directors (the “Board”). Executive’s initial Base Salary shall be approximately

 

$260,000 per annum, translated into local currency as applicable and subject to
exchange rate fluctuations. The Base Salary shall be reviewed annually by or
pursuant to authority granted by the Board in connection with its annual review
of executive compensation to determine if such Base Salary should be increased
for the following year in recognition of services to the Company. The Base
Salary shall be payable at such intervals in conformity with the Employer’s
prevailing practice as such practice shall be established or modified from time
to time.

 

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(b)

Bonuses; Additional Compensation. Executive will be eligible to receive bonuses
and to participate in compensation plans of the Employer in accordance with any
plan or decision that the Board, or any committee or other person authorized by
the Board, may in its sole discretion determine from time to time.

 

 

(c)

Reimbursement of Expenses. Executive shall be paid or reimbursed by the
Employer, or an applicable subsidiary or affiliate thereof, in accordance with
and subject to the Employer’s (or the relevant subsidiary’s or affiliate’s)
general expense reimbursement policies and practices, for all reasonable travel
and other business expenses incurred by Executive in performing his obligations
under this Agreement.

 

 

(d)

Other Benefits. During the period of employment hereunder, Executive shall be
entitled to participate in all other benefits of employment generally available
to other executives of the Employer and those benefits for which such persons
are or shall become eligible, when and as he becomes eligible therefore.

 

 

 

5.

Termination of Employment.

 

(a)

Termination as a Result of Executive’s Death or Disability. Executive’s
employment hereunder shall terminate automatically upon Executive’s death and
may be terminated by the Employer upon Executive’s “Disability” (as hereinafter
defined). If Executive’s employment hereunder is terminated by reason of
Executive’s death or Disability, Executive’s (or Executive’s estate’s) right to
benefits under this Agreement will terminate as of the date of such termination
and all of the Employer’s obligations hereunder shall immediately cease and
terminate, except that (i) Executive or Executive’s estate, as the case may be,
will be entitled to receive accrued Base Salary and benefits through the date of
termination and (ii) all outstanding unvested equity awards issued to Executive
by the Employer shall vest in full upon such termination of employment. As used
herein, Executive’s “Disability” shall have the meaning set forth in any
long-term disability plan in which Executive participates, and in the absence
thereof shall mean the determination in good faith by the Board that, due to
physical or mental illness, Executive shall have failed to perform his duties on
a full-time basis hereunder for one hundred eighty (180) consecutive days and
shall not have returned to the performance of his duties hereunder on a
full-time basis before the end of such period. If Disability has occurred,
termination of Executive’s employment hereunder shall occur within thirty (30)
days after written notice of such termination is given (which notice may be
given before the end of the one hundred eighty (180) day period described above
so as to cause termination of employment to occur as early as the last day of
such period).

 

 

(b)

Termination by Executive for Good Reason or by the Employer other than as a
Result of Executive’s Death or Disability or for Cause.

 

 

(i)

Executive may terminate Executive’s employment hereunder for “Good Reason” (as
hereinafter defined), if Good Reason exists, upon at least five (5) days prior
written notice to the Employer, and the Employer may terminate Executive’s
employment hereunder for any reason or for no reason, other than as a result of
Executive’s death or Disability or for Cause (as hereinafter defined), in each
case with the consequences set forth in this Section 5(b).

 

 

(ii)

If Executive’s employment hereunder is terminated by Executive for Good Reason
or by the Employer other than by reason of Executive’s death or Disability and
other than for Cause, then, subject to Executive entering into and not revoking
a release of claims in favor of the Employer and the Company pursuant to Section
5(e) below, and Executive fully complying with the covenants set forth in
Section 6, Executive shall be entitled to the following benefits:

 

 

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(1)

Cash severance payments equal in the aggregate to twelve (12) months of
Executive’s annual Base Salary at the time of termination, payable as soon as
practicable pursuant to the Company’s normal payroll practices.

 

 

 

(2)

In the event Executive elects COBRA continuation coverage for the level of
medical coverage he had in force at the time of his termination, the Employer
shall reimburse Executive for the monthly cost of such continuation coverage
until the earlier of (A) the date Executive ceases to maintain such continuation
coverage in effect or

 

(B) twelve (12) months from the termination of Executive’s employment.

 

(iii)

For purposes of this Agreement, “Good Reason” shall mean: (1) a material
reduction (without Executive’s express written consent) in Executive’s title or
responsibilities; (2) the Employer’s material breach (without Executive’s
express written consent) of Sections 2 or 4 of this Agreement; or (3) following
a “Change of Control” (as such term is defined in the Unifi, Inc. Amended and
Restated 2013 Incentive Compensation Plan), Executive not being an officer of
the ultimate surviving parent business entity resulting from such Change of
Control transaction, in a substantially similar role to that performed by
Executive for the Employer prior to such Change of Control, for a period of at
least twelve (12) months thereafter; provided, that with respect to the
foregoing clauses (1) and (2), Executive has provided the Employer written
notice of the event or circumstance purporting to constitute Good Reason within
thirty (30) days of the event or circumstance occurring and the Employer has not
cured such event or circumstance within fifteen

 

(15) days following the date Executive provides such notice. If the Employer
thereafter intentionally repeats the breach it previously cured, such breach
shall no longer be deemed curable.

 

(c)

Termination by Executive other than for Good Reason. Executive may terminate his
employment with the Employer other than for Good Reason upon thirty (30) days
prior written notice to the Employer, after which the Employer shall have no
further obligation hereunder to Executive, except for payment of accrued Base
Salary and benefits through the termination date. If Executive so notifies the
Employer of such termination, the Employer shall have the right to accelerate
the effective date of such termination to any date after the Employer’s receipt
of such notice, but such acceleration will not be deemed to constitute a
termination of Executive’s employment by the Employer without Cause, and the
consequences of such termination will continue to be governed by this
subsection.

 

 

(d)

Termination by the Employer for Cause. The Employer may terminate Executive’s
employment under this Agreement at any time for “Cause” (as hereinafter defined)
whereupon the Employer shall have no further obligation hereunder to Executive,
except for payment of amounts of Base Salary and benefits accrued through the
termination date. For purposes of this Agreement, “Cause” shall mean: (i) the
continued willful failure by Executive to substantially perform his duties to
the Company,

 

(ii) the willful engaging by Executive in gross misconduct materially and
demonstrably injurious to the Company or (iii) Executive’s material breach of
Sections 3, 6 or 7 of this Agreement; provided, that with respect to any breach
that is curable by Executive, as determined by the Board in good faith, the
Employer has provided Executive written notice of the material breach and
Executive has not cured such breach, as determined by the Board in good faith,
within fifteen (15) days following the date the Employer provides such notice.

 

(e)

Waiver and Release. In consideration for and as a condition to the payments and
benefits provided and to be provided under Section 5(b)(ii) of this Agreement
other than those provided under Section 9 (indemnification), Executive agrees
that Executive will, within thirty (30) days after the termination of
Executive’s employment hereunder, deliver to the Employer a fully executed
release agreement substantially in a form then used by and agreeable to the
Employer and which shall fully and irrevocably release and discharge the
Company, its directors, officers, and employees from any and all

 

 

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claims, charges, complaints, liabilities of any kind, known or unknown, owed to
Executive, other than any rights Executive may have under the terms of this
Agreement that survive such termination of employment and other than any vested
rights of Executive under any of the Company’s employee benefit plans or
programs that, by their terms, survive or are unaffected by such termination of
employment.

 

 

6.

Certain Covenants by Executive.

 

(a)

Confidential Information. Executive acknowledges that in his employment
hereunder he will occupy a position of trust and confidence. Executive shall
not, except in the course of the good faith performance of his duties hereunder
or as required by applicable law, without limitation in time or until such
information shall have become public other than by Executive’s unauthorized
disclosure, disclose to others or use, whether directly or indirectly, any
Confidential Information (as hereinafter defined) regarding the Company. For
purposes of this Agreement, “Confidential Information” shall mean information
about the Company or its clients or customers that was learned by Executive in
the course of his employment by the Employer, including (without limitation) any
proprietary knowledge, trade secrets, data, formulae, information and client and
customer lists and all papers, resumes, and records (including computer records)
of the documents containing such Confidential Information, but excludes
information (i) which is in the public domain through no unauthorized act or
omission of Executive; or (ii) which becomes available to Executive on a
non-confidential basis from a source other than the Company without breach of
such source’s confidentiality or non-disclosure obligations to the Company.
Executive agrees to deliver or return to the Employer, at the Employer’s request
at any time or upon termination or expiration of his employment or as soon
thereafter as possible, (i) all documents, computer tapes and disks, records,
lists, data, drawings, prints, notes and written information (and all copies
thereof) furnished by the Company or prepared by Executive during the term of
his employment by the Employer and (ii) all notebooks and other data relating to
research or experiments or other work conducted by Executive in the scope of
such employment. Upon the date of termination of Executive’s employment
hereunder, Executive shall, as soon as possible but no later than two (2) days
after the date of termination, surrender to the Employer all Confidential
Information in Executive’s possession and return to the Employer all Company
property in Executive’s possession or control, including but not limited to, all
paper records and documents, computer disks and access cards and keys to any
Company facilities.

 

 

(b)

Non-Competition. During the period of Executive’s employment hereunder and for a
period of twelve (12) months after the date of termination of his employment,
Executive shall not, directly or indirectly, in the “Restricted Territory” (as
hereinafter defined), without the prior written consent of the Employer, provide
consultative services or otherwise provide services to (whether as an employee
or a consultant, with or without pay) or, own, manage, operate, join, control,
participate in, or be connected with (as a shareholder, partner, or otherwise),
any business, individual, partner, firm, corporation, or other entity that is
then a competitor of the Company (each such competitor a “Competitor of the
Company”); provided, however, that the “beneficial ownership” by Executive,
either individually or as a member of a “group,” as such terms are used in Rule
13d of the General Rules and Regulations under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), of not more than five percent (5%) of the
voting stock of any publicly held corporation shall not alone constitute a
violation of this Agreement. For purposes of this Agreement, “Restricted
Territory” shall mean: (i) the State of North Carolina, (ii) the other
contiguous states of the United States of America, and (iii) any other
jurisdiction in which the Company is doing or does business during Executive’s
employment hereunder. Executive and the Employer acknowledge and agree that the
business of the Company extends throughout the contiguous states of the United
States of America and internationally.

 

 

(c)

Non-Solicitation of Customers and Suppliers. During the period of Executive’s
employment hereunder and for a period of twelve (12) months after the date of
termination of Executive’s

 

 

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employment hereunder, Executive shall not, directly or indirectly, influence or
attempt to influence customers or suppliers of the Company to divert any of
their business to any Competitor of the Company.

 

(d)

Non-Solicitation of Employees. Executive recognizes that he possesses and will
possess Confidential Information about other employees of the Company relating
to their education, experience, skills, abilities, compensation and benefits,
and inter-personal relationships with customers of the Company. Executive
recognizes that the information he possesses and will possess about these other
employees is not generally known, is of substantial value to the Company in
developing its business and in securing and retaining customers, and has been
and will be acquired by him because of his business position with the Company.
Executive agrees that, during the period of Executive’s employment hereunder and
for a period of twelve (12) months thereafter, he will not, directly or
indirectly, solicit, recruit, induce or encourage or attempt to solicit,
recruit, induce, or encourage any employee of the Company (i) for the purpose of
being employed by him or by any Competitor of the Company on whose behalf he is
acting as an agent, representative or employee or (ii) to terminate his or her
employment or any other relationship with the Company. Executive also agrees
that Executive will not convey any Confidential Information or trade secrets
about other employees of the Company to any other person.

 

 

 

(e)

Post-Termination Covenants by Executive.

 

 

(i)

Upon the termination of Executive’s employment hereunder, regardless of

(A) the date, cause, or manner of the Termination of Employment, (B) whether the
Termination of Employment is with or without Cause or is a result of Executive’s
resignation, or (C) whether the Employer provides severance benefits to
Executive under this Agreement (the “Termination of Employment”), Executive
shall resign and does resign (1) as a member of the Board if serving on the
Board at that time and (2) from all positions as an officer, director or manager
of the Company and from any other positions with the Company, with all such
resignations to be effective upon the date of the Termination of Employment.

 

(ii)

From and after the Termination of Employment, Executive agrees not to make any
statements to the Company’s employees, customers, vendors, or suppliers or to
any public or media source, whether written or oral, regarding Executive’s
employment hereunder or termination from the Employer’s employment, except as
may be approved in writing by an executive officer of the Employer in advance.
Executive further agrees not to make any statement (including to any media
source, or to the Company’s suppliers, customers or employees) or take any
action that would disrupt, impair, embarrass, harm or affect adversely the
Company or any of the employees, officers, directors, or customers of the
Company or place the Company or such individuals in any negative light.

 

 

(iii)

From and after the Termination of Employment, Executive agrees to cooperate with
and provide assistance to the Company and its legal counsel in connection with
any litigation (including arbitration or administrative hearings) or
investigation affecting the Company, in which, in the reasonable judgment of the
Company’s counsel, Executive’s assistance or cooperation is needed. Executive
shall, when requested by the Company, provide testimony or other assistance and
shall travel at the Company’s request in order to fulfill this obligation. In
connection with such litigation or investigation, the Company shall attempt to
accommodate Executive’s schedule, shall reimburse Executive (unless prohibited
by law) for any actual loss of wages in connection therewith, shall provide
Executive with reasonable notice in advance of the times in which Executive’s
cooperation or assistance is needed, and shall reimburse Executive for any
reasonable expenses incurred in connection with such matters.

 

 

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(f)

Injunctive Relief. It is expressly agreed that the Employer will or would suffer
irreparable injury, for which a remedy in monetary damages alone would be
inadequate, if Executive were to violate any of the provisions of this Section 6
and that the Employer would by reason of such violation be entitled to
injunctive relief in a court of appropriate jurisdiction, and Executive further
consents and stipulates to the entry of such injunctive relief in such a court
prohibiting Executive from so violating Section 6 of this Agreement, in addition
to any and all damages or other remedies to which the Employer would be entitled
at law or in equity. Nothing herein shall be construed as prohibiting the
Employer from pursuing any other equitable or legal remedies for such breach or
threatened breach, including the recovery of monetary damages from Executive.

 

 

(g)

Executive’s Acknowledgement. Executive acknowledges and agrees that (i) the
restrictive covenants in this Section 6 are reasonable in time, territory and
scope, and in all other respects and (ii) should any part or provision of any
covenant herein be held invalid, void or unenforceable in any court of competent
jurisdiction, such invalidity, voidness, or unenforceability shall not render
invalid, void or unenforceable any other part or provision of this Agreement.
The restrictive covenants contained herein shall be construed as agreements
independent of any other provision in this Agreement and the existence of any
claim or cause of action of Executive against the Employer, whether predicated
on this Agreement or otherwise, shall not constitute a defense to the
enforcement by the Employer of these covenants.

 

 

 

(h)

Protected Disclosures. Pursuant to the Defend Trade Secrets Act of 2016 (8

U.S.C. § 1833(b)), Executive will not be held criminally or civilly liable under
any federal or state trade secret law for the disclosure of a trade secret of
the Company that (i) is made (A) in confidence to a federal, state, or local
government official, either directly or indirectly, or to an attorney and (B)
solely for the purpose of reporting or investigating a suspected violation of
law; or (ii) is made in a complaint or other document that is filed under seal
in a lawsuit or other proceeding. If Executive files a lawsuit for retaliation
by the Company for reporting a suspected violation of law, Executive may
disclose the trade secret to Executive’s attorney and use the trade secret
information in the court proceeding, if Executive (i) files any document
containing the trade secret under seal, and (ii) does not disclose the trade
secret, except pursuant to court order. Nothing in this Agreement, is intended
to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of
trade secrets that are expressly allowed by such section. Notwithstanding any
provision in any agreement between Executive and the Company, Executive may
disclose any confidential or non- public information (i) to report possible
violations of federal law or regulation to any governmental agency or entity,
including but not limited to the Department of Justice, the Securities and
Exchange Commission, the United States Congress and any agency Inspector
General, or make other disclosures that are protected under the whistleblower
provisions of federal law or regulation or (ii) as required by law or order by a
court; provided, however, Executive agrees to notify the Company in advance if
Executive is required to provide information or testimony in connection with any
action brought by a non-governmental or non-regulatory person or entity.

 

(i)

Survival of Provisions. The obligations contained in this Section 6 shall
survive the termination or expiration of Executive’s employment hereunder and
shall be fully enforceable thereafter.

 

 

7.No Conflict. Executive represents and warrants that Executive is not subject
to any agreement, instrument, order, judgment or decree of any kind, or any
other restrictive agreement of any character, which would prevent Executive from
entering into this Agreement or would conflict with the performance of
Executive’s duties pursuant to this Agreement. Executive represents and warrants
that Executive will not engage in any activity, which would conflict with the
performance of Executive’s duties pursuant to this Agreement.

 

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8.Notices. Any notice, requests, demands and other communications to be given to
a party in connection with this Agreement shall be in writing addressed to such
party at such party’s “Notice Address,” which shall initially be as set forth
below:

 

If to the Company:Unifi, Inc.

7201 West Friendly Avenue Greensboro, North Carolina 27410 Attn: General Counsel

 

If to Executive:Lucas de Carvalho Rocha

Most recent address reflected on the Company’s payroll records

 

A party’s Notice Address may be changed or supplemented from time to time by
such party by notice thereof to the other party as herein provided. Any such
notice shall be deemed effectively given to and received by a party on the first
to occur of (a) the date on which such notice is actually delivered (whether by
mail, courier, hand delivery, electronic or facsimile transmission or otherwise)
to such party’s Notice Address and addressed to such party, if such delivery
occurs on a business day, or if such delivery occurs on a day which is not a
business day, then on the next business day after the date of such delivery, or
(b) the date on which such notice is actually received by such party (or, in the
case of a party that is not an individual, actually received by the individual
designated in the Notice Address of such party). For purposes of the preceding
sentence, a “business day” is any day other than a Saturday, Sunday or U.S.
federal public legal holiday.

 

 

9.

Indemnification.

 

(a)

General. Subject to the limitations set forth in this Section 9, the Employer
shall indemnify and hold harmless, to the fullest extent permitted by applicable
law as it presently exists or may hereafter be amended, Executive if Executive
was or is made or is threatened to be made a party to or is otherwise involved
in any pending, threatened or completed action, suit, arbitration, alternative
dispute resolution proceeding, investigation, administrative hearing, or other
proceeding, whether by or in the right of the Employer, any other Company, or
any other person or entity, whether civil, criminal, administrative or
investigative (a “Proceeding”) by reason of the fact that Executive is or was a
director, officer, employee or agent of the Employer or is or was serving at the
request of the Employer as a director, officer, member, employee or agent of any
other Company or other enterprise, including service with respect to employee
benefit plans, against all cost, expense, liability and loss (including without
limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably incurred or suffered by
Executive or on Executive’s behalf in connection with any Proceeding and any
appeal therefrom. Executive’s rights under this Section 9 shall continue after
Executive has ceased acting as a director, officer, member, employee or agent of
a Company and shall inure to the benefit of the heirs, executors and
administrators of Executive. The Employer’s obligation to provide the
indemnification set forth in this Section 9(a) shall be subject to Executive
having acted in good faith and in a manner Executive reasonably believed to be
in or not opposed to the best interests of any Company, and, with respect to any
criminal action or proceeding, having had no reasonable cause to believe
Executive’s conduct was unlawful. The termination of any Proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that Executive did not
act in good faith and in a manner which Executive reasonably believed to be in
or not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that Executive’s
conduct was unlawful.

 

 

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(b)

Advancement of Expenses. Subject to the limitations set forth in this Section 9,
the Employer shall pay the reasonable expenses (including reasonable attorneys’
fees) incurred by Executive in defending any Proceeding in advance of its final
disposition; provided, however, that such advancement of expenses shall be made
only upon receipt of an undertaking by Executive, in a form approved by the
Employer, to repay all amounts advanced if it shall ultimately be determined
that Executive is not entitled to be indemnified therefor. Executive agrees to
reimburse the Employer for all expenses advanced under this Section 9 in the
event and only to the extent it shall ultimately be determined by a final
adjudication that Executive is not entitled to be indemnified by the Employer
for such expenses.

 

 

 

(c)

Claims for Indemnification or Advancement; Determination of Eligibility.

 

(i)

Any claim by Executive for indemnification or advancement of expenses under this
Agreement shall be made in a writing delivered to the Employer, setting forth in
reasonable detail the basis for such indemnification or advancement and the
amount requested, and accompanied by appropriate documentation to support the
amount so requested (or, in the case of advancement of expenses to be incurred,
the basis on which such amount is to be determined). A claim for advancement may
include future expenses reasonably expected to be incurred, provided they are
generally described in the claim, and provided that the Employer shall not be
required to advance particular expenses covered by the claim until it has
received appropriate substantiation that those expenses have been incurred and
are appropriately included within the advances approved by the Employer pursuant
to this Section 9(c).

 

 

(ii)

Promptly upon its receipt of a written claim for advancement of expenses to
which Executive is entitled hereunder, and within sixty (60) days after its
receipt of a written claim for indemnity to which Executive is entitled
hereunder, the Employer shall pay such advancement (and any future related
submissions for advancement of expenses as they are incurred) or such claim for
indemnity in full to or as directed by Executive. If and to the extent it is
required by law that the Employer make any particular determination as to
Executive’s eligibility to receive such advancements or indemnity, or whether
Executive has met the standards set forth in Section 9(a) hereof, the Employer
shall make such determination as promptly as practicable in good faith and in
accordance with such requirements of law, and in any event within sixty (60)
days after its receipt of the claim from Executive. In the event that the
Employer fails to make such determination as to Executive’s eligibility, or
makes a determination that Executive is ineligible for indemnification or
advancement of expenses hereunder, within such sixty (60)-day period, then
Executive may seek such determination from a court of competent jurisdiction. In
any such proceeding, the Employer shall have the burden of proving that
Executive was not entitled to the requested indemnification or advancement of
expenses, and any prior determination by the Employer to the contrary shall be
to no effect and shall not be given any weight by the court, it being the
intention of the parties that any determination by the court as to Executive’s
eligibility for and entitlement to indemnification or advancement of expenses
hereunder shall be made de novo based upon the terms of this Agreement and the
evidence presented to such court.

 

 

(d)

Limitations on Claims. In addition to the limitations on indemnification set
forth in Section 9(a) above, the Employer shall not be obligated pursuant to
this Agreement:

 

 

(i)

To indemnify or advance expenses to Executive with respect to a Proceeding
initiated by Executive, except (i) for Proceedings authorized or consented to by
the Board; or (ii) in the event a claim for indemnification or payment of
expenses (including attorneys’ fees) made under this Agreement is not paid in
full within sixty (60) days after a written claim therefor has been received by
the Employer, Executive may file suit to recover the unpaid amount of such claim
and, if successful in whole or in part, shall be entitled to be paid the expense
of

 

 

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prosecuting such claim, including attorneys’ fees. In any such action, the
Employer shall have the burden of proving that Executive was not entitled to the
requested indemnification or payment of expenses under applicable law or this
Agreement.

 

(ii)

To indemnify Executive for any expenses incurred by Executive with respect to
any Proceeding instituted by Executive to enforce or interpret this Agreement,
unless Executive is successful in establishing Executive’s right to
indemnification in such Proceeding, in whole or in part; provided, however, that
nothing in this Section 9(d)(ii) is intended to limit the Employer’s obligation
with respect to the advancement of expenses to Executive in connection with any
Proceeding instituted by Executive to enforce or interpret this Agreement, as
provided in Section 9(c) above.

 

 

(iii)To indemnify Executive in connection with proceedings or claims involving
the enforcement of the provisions of this Agreement (other than as otherwise
specifically provided for in this Section 9) or any other employment, severance
or compensation plan or agreement that Executive may be a party to, or
beneficiary of, with the Employer or any other Company.

 

(iv)

To indemnify Executive on account of any proceeding with respect to which final
judgment is rendered against Executive for payment or an accounting of profits
arising from the purchase or sale by Executive of securities in violation of
Section 16(b) of the Securities Exchange Act of 1934, as amended, any similar
successor statute, or similar provisions of state statutory law or common law.

 

 

(e)

Non-Exclusivity of Rights. The right conferred on Executive by this Section 9
shall not be exclusive of any other rights which Executive may have or hereafter
acquire under any statute, provision of the Employer’s articles of incorporation
or bylaws, agreement, vote of shareholders or disinterested directors or
otherwise, or under any insurance maintained by the Employer; but such rights in
the aggregate shall not entitle Executive to duplicative multiple recoveries. No
amendment or alteration of the Employer’s articles of incorporation or bylaws or
any other agreement shall adversely affect the rights provided to Executive
under this Section 9.

 

 

(f)

Savings Clause. If any provision or provisions of this Agreement shall be
invalidated on any ground by any court of competent jurisdiction, then the
Employer shall nevertheless indemnify Executive as to costs, charges and
expenses (including attorneys’ fees), judgments, fines and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, including an action by or in the
right of the Employer, to the full extent permitted by any applicable portion of
this Agreement that shall not have been invalidated and to the full extent
permitted by applicable law.

 

 

 

10.

Dispute Resolution.

 

(a)Any dispute between Executive and the Employer arising out of this Agreement
or the performance or nonperformance hereof (except with respect to Section 9),
shall, upon the demand of either Executive or the Employer, be settled by
binding arbitration in accordance with the Employment Arbitration Rules and
Mediation Procedures of the American Arbitration Association as in effect at the
time the arbitration is commenced and the provisions of this subsection:

 

(i)The arbitration shall be conducted in Greensboro, North Carolina by a panel
of three impartial arbitrators selected in accordance with such rules, unless
the parties

 

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shall hereafter mutually agree in writing to have the arbitration conducted by a
single arbitrator.

 

(ii)In conducting the arbitration and rendering their award, the arbitrators
shall give effect to the terms of this Agreement, including the choice of
applicable law, shall give effect to any other agreement of the parties relating
to the conduct of the arbitration, and shall give effect to applicable statutes
of limitations.

 

(iii)The costs of the arbitration, including the fees and expenses of the
arbitrators and of the American Arbitration Association, shall be allocated to
such parties as, and in such proportions as, the arbitrators shall determine to
be just and equitable, which determination shall be set forth in the award.

 

(iv)Judgment upon the award of the arbitrators may be entered by any court of
competent jurisdiction.

 

(b)

Nothing in this Section 10 shall preclude any party from applying to a court of
competent jurisdiction for, and obtaining if warranted, preliminary or ancillary
relief pending the conduct of such arbitration, or an order to compel the
arbitration provided for herein.

 

 

(c)

Any claim arising out of Section 9, including a claim by Executive for
indemnification or advancement of expenses thereunder, shall be brought before
the state courts of the State of North Carolina pursuant to Section 12.

 

 

11.Assignment; Successors. This Agreement is personal in its nature and neither
of the parties hereto shall, without the consent of the other, assign or
transfer this Agreement or any rights or obligations hereunder; provided that,
this Agreement shall be binding upon and, subject to the provisions hereof,
inure to the benefit of any successor of the Employer and such successor shall
be deemed substituted for the Employer under the terms of this Agreement; but
any such substitution shall not relieve the Employer of any of its obligations
under this Agreement. As used in this Agreement, the term “successor” shall
include any person, firm, corporation, or like business entity which at any
time, whether by merger, purchase or otherwise, acquires all or a controlling
interest in the assets or business of the Employer.

 

12.Governing Law. The validity, interpretation, construction and performance of
this Agreement shall be governed by, and construed and enforced in accordance
with, the substantive laws of the State of North Carolina, without giving effect
to its principles of conflict of laws. Executive and the Employer each hereby
irrevocably consent that both parties are subject to the jurisdiction of the
state courts of the State of North Carolina for all purposes in connection with
any action or proceeding that arises out of or relates to this Agreement, and
further agree that the sole and exclusive venue for any such dispute shall be
the General Court of Justice, Superior Court Division, in Guilford County, North
Carolina.

 

13.Withholding. The Employer shall make such deductions and withhold such
amounts from each payment made to Executive hereunder as may be required from
time to time by law, governmental regulation or order.

 

14.Headings. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.

 

15.Waiver; Modification. Failure to insist upon strict compliance with any of
the terms, covenants, or conditions hereof shall not be deemed a waiver of such
term, covenant, or condition, nor shall any waiver or relinquishment of, or
failure to insist upon strict compliance with, any right or power

 

10

 

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hereunder at any one or more times be deemed a waiver or relinquishment of such
right or power at any other time or times. This Agreement shall not be modified
in any respect except by a writing executed by each party hereto.

 

16.Severability. The parties have entered into this Agreement for the purposes
herein expressed, with the intention that this Agreement be given full effect to
carry out such purposes. Therefore, consistent with the effectuation of the
purposes hereof, the invalidity or unenforceability of any provision hereof or
part thereof shall not affect the validity or enforceability of any other
provision hereof or any other part of such provision.

 

17.Entire Agreement. This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes any prior
agreements between them with respect to the subject matter hereof. Without
limiting the generality of the foregoing, the obligations under this Agreement
with respect to any termination of employment of Executive, for whatever reason,
supersede any severance or related obligations of the Company in any policy,
plan or practice of the Company or any agreement between Executive and the
Company.

 

18.Counterparts. This Agreement may be executed by the parties hereto in
multiple counterparts and shall be effective as of the Effective Date when each
party shall have executed and delivered a counterpart hereof, whether or not the
same counterpart is executed and delivered by each party. When so executed and
delivered, each such counterpart shall be deemed an original and all such
counterparts shall be deemed one and the same document. Transmission of images
of signed signature pages by facsimile, e-mail or other electronic means shall
have the same effect as the delivery in person of manually signed documents.

 

19.Compliance with Section 409A. This Agreement is intended to comply with
Section 409A of  the  Internal  Revenue  Code  of  1986,  as  amended  
(“Section   409A”),   to   the   extent   applicable. Notwithstanding any
provision herein to the contrary, this Agreement shall be interpreted, operated
and administered consistent with this intent. Each separate installment under
this Agreement shall be treated as a separate payment for purposes of
determining whether such payment is subject to or exempt from compliance with
the requirements of Section 409A. In addition, in the event that Executive is a
“specified employee” within the meaning of Section 409A (as determined in
accordance with the methodology established by the Employer as in effect on the
date of termination of Executive’s employment hereunder), any payment or
benefits hereunder that are nonqualified deferred compensation subject to the
requirements of Section 409A shall be provided to Executive no earlier than six
(6) months after the date of Executive’s “separation from service” within the
meaning of Section 409A.

 

[Signatures follow on next page]

 

11

 

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IN WITNESS WHEREOF, the Employer has caused this Agreement to be executed by its
duly authorized officer, and Executive has hereunto signed this Agreement, on
the Signature Date to be effective as of the Effective Date.

 

 

 

 

“Employer”:

 

 

 

 

 

Unifi, Inc.

 

 

 

 

 

 

By:

/s/ EDMUND M. INGLE

 

 

Name:

Edmund M. Ingle

 

 

Title:

CEO

 

 

 

 

 

 

“Executive”:

 

 

 

 

 

 

/s/ LUCAS DE CARVALHO ROCHA

 

 

Name:

Lucas de Carvalho Rocha

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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[signature page to employment agreement]