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                                  Exhibit (10r)


                               SEVERANCE AGREEMENT


         This SEVERANCE AGREEMENT ("Agreement") effective the 30th day of April,
2003 (the "Effective Date"), by and between UNIFI, INC., a New York corporation
(hereinafter referred to as "UNIFI" or the "Company"), and OTTIS LEE GORDON
(hereinafter referred to as "EMPLOYEE");

                              W I T N E S S E T H:

         WHEREAS, EMPLOYEE has been employed by UNIFI; and

         WHEREAS, the Company and EMPLOYEE have determined that the EMPLOYEE'S
employment with the Company will be terminated on the Effective Date under the
terms of this Agreement; and

         WHEREAS, under the terms set forth in this Agreement, EMPLOYEE and
UNIFI agree to settle any and all claims, obligations and/or causes of action
that one may have against the other arising from EMPLOYEE'S employment with the
Company; and

         WHEREAS, EMPLOYEE HEREBY ACKNOWLEDGES THAT HE WAS UNDER NO OBLIGATION
WHATSOEVER TO ACCEPT THE TERMS OF THIS AGREEMENT, AND THAT PRIOR TO EXECUTING
THIS AGREEMENT HE WAS GIVEN THE OPPORTUNITY TO REQUEST A COPY OF THIS AGREEMENT
AND DELAY HIS DECISION WHETHER OR NOT TO ACCEPT THE TERMS OF THIS AGREEMENT FOR
UP TO FORTY-FIVE (45) DAYS FOR ANY REASON, INCLUDING TO CONFER WITH ANY LAWYER
OR OTHER ADVISOR HE MAY WISH TO CONSULT; and

         WHEREAS, EMPLOYEE also acknowledges that he has received a document
identifying the job title and age of each employee in his decisional unit, and
whether or not each employee was selected for termination.

         NOW, THEREFORE, in consideration of these premises and mutual
agreements herein contained, and intending to be legally bound hereby, the
Parties agree as follows:

SECTION 1.        CONSIDERATION - UNIFI agrees to pay EMPLOYEE the sum of
                  four hundred thousand eight dollars and 00/100 ($400,008.00)
                  as severance due to termination of his employment with Unifi
                  (the "Severance Payment"). The Promissory Note Balance of
                  $39,448.08 as set forth in Section 8.a below plus an
                  additional $17,751.64 in United States and North Carolina
                  withholding taxes on the Promissory Note
                  Balance(i.e.$39,448.08x.45) shall be deducted from the
                  Severance Payment to get the resulting balance of severance
                  due to EMPLOYEE of three hundred sixty thousand five hundred
                  fifty-nine dollars and 92/100 ($342,808.28) (the "Resulting
                  Severance Payment"). The Resulting Severance Payment shall be
                  paid to EMPLOYEE in twenty (20) equal monthly installments of
                  sixteen

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                  thousand six hundred sixty-seven dollars and 00/100
                  ($16,667.00) beginning on the regular payroll date for
                  salaried employees of UNIFI in May 2003

                  and continuing until December 2004 and one final monthly
                  installment of nine thousand four hundred sixty-eight dollars
                  and 28/100 ($9,468.28) on the regular payroll date for
                  salaried employees of UNIFI in January 2005 (the "Monthly
                  Payments"). Each such Monthly Payment will be subject to all
                  applicable federal and state taxes. The parties agree that the
                  Company has no prior legal obligation to make the Severance
                  Payment or to provide any of the other benefits set forth in
                  this Agreement to the EMPLOYEE.

SECTION 2.        RESIGNATION FROM COMPANY - On the Effective Date, EMPLOYEE
                  shall execute a written Resignation in the form of Exhibit "A"
                  attached hereto resigning as an employee of the Company.

SECTION 3A.       MEDICAL AND DENTAL INSURANCE - UNIFI will continue to
                  provide EMPLOYEE medical and dental coverage similar to the
                  medical and dental coverages at that time being provided to
                  regular employees covered by the terms of the Unifi, Inc.
                  Employee Welfare Benefit Plan then in effect (the "Medical
                  Plan"), until the earlier of the last day of the month in
                  which EMPLOYEE attains the age of 65 years or until such time
                  as EMPLOYEE has began new employment, including gainful
                  self-employment (as determined by Unifi in its sole
                  discretion). EMPLOYEE shall be eligible to receive such
                  medical and dental benefits in order that he may obtain
                  coverage for himself and his dependents, as the term
                  "dependent" is defined in the medical plan, so that the
                  following shall apply to coverage of EMPLOYEE and his
                  dependents.

                  (A) As a condition of coverage of EMPLOYEE, he must pay for
                  each month of coverage an amount equal to the premium paid for
                  such month by an active employee for coverage under the
                  Medical Plan. During the time when Monthly Payments, if any,
                  are being made, such premiums shall be paid by deductions from
                  such installments unless UNIFI in its sole discretion
                  determines otherwise. Thereafter, such premiums shall be due
                  on the first day of the month to which they apply, and the
                  medical and dental coverage shall be terminated unless such
                  premiums are received when due, without any grace period.

                  (B) As a condition of coverage of a Dependent, EMPLOYEE must
                  pay for each month of coverage an amount equal to the premium
                  paid for such month by any active employee for coverage of a
                  Dependent under the Medical Plan. During the time when Monthly
                  Payments, if any, are being made, such premiums shall be paid
                  by deductions from such installments unless UNIFI in its sole
                  discretion determines otherwise. Thereafter, such premiums
                  shall be due on the first day of the month to which they
                  apply, and the medical and dental coverage shall be terminated
                  unless such premiums are received when due, without any grace
                  period.

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                  (C) The terms of medical and dental coverage for EMPLOYEE and
                  his Dependents at any given time shall be the terms applicable
                  to active employees and their Dependents at such time. It is
                  explicitly understood and agreed that any amendments to or
                  alteration of the Medical Plan (including any amendment
                  terminating the Medical Plan) may be applicable to EMPLOYEE
                  and his Dependents without regard to whether the amendment or
                  alteration was adopted or made before or after the Effective
                  Date, and/or the date EMPLOYEE entered into this Agreement
                  and/or chose not to revoke this Agreement. It is explicitly
                  understood and agreed that a Dependent will lose medical and
                  dental coverage on the earlier of the last day of the month in
                  which EMPLOYEE attains the age of 65 years or until such time
                  as EMPLOYEE has began new employment, including gainful
                  self-employment (as determined by Unifi in its sole
                  discretion). It is explicitly understood and agreed that no
                  benefits under the Employee Welfare Plan will be provided
                  (including, without limitation, benefits under the portions of
                  the Welfare Benefit Plan that provide benefits in the event of
                  disability, life insurance coverage, and accidental death and
                  dismemberment coverage) except as specifically provided
                  herein.

SECTION 3B.       COBRA, ETC. - It is understood that this Agreement does
                  not waive or abrogate EMPLOYEE'S entitlement to health
                  insurance benefits under COBRA or to vested retirement funds
                  in UNIFI'S retirement plans. Any retirement benefits to which
                  EMPLOYEE is entitled shall be governed by the terms of such
                  retirement plans.

SECTION 4.        OTHER BENEFITS AND AGREEMENTS -

                  a.       UNIFI agrees to provide and pay for all reasonable
                           outplacement services of EMPLOYEE until the sooner of
                           April 30, 2005 or until such time as EMPLOYEE has
                           obtained new employment.

                  b.       EMPLOYEE agrees that except as specifically set forth
                           in this Agreement no other provision is granted for
                           continued vacation pay, automobile allowance,
                           education renewal, tuition reimbursement, mobile
                           telephone service or other benefits of any nature,
                           type or kind after the Effective Date, and that he
                           will return to UNIFI or any subsidiary or affiliate
                           of UNIFI all company property, documents, notes,
                           software, programs, data and any other materials
                           (including any copies thereof) in his possession.
                           EMPLOYEE does hereby consent and agree that he shall
                           have no other right, claim, demand or interest of any
                           nature, type or kind or commence any type of legal
                           action (including administrative charges or lawsuits)
                           against UNIFI, its subsidiaries or affiliates, and
                           any of their officers, directors, shareholders,
                           representatives, counsel, or agents.


                                       3
<PAGE>

SECTION 5.        TAXES - EMPLOYEE will be responsible for any federal, state
                  or local taxes which may be owed by him by virtue of the
                  receipt of any portion of the consideration herein provided.

SECTION 6.        UNVESTED RESTRICTED STOCK AWARDS -EMPLOYEE under the 1999
                  Unifi, Inc. Long-Term Incentive Plan was awarded on October
                  21, 1999 5,000 shares of Unifi, Inc. restricted stock and
                  executed a Restricted Stock Agreement in connection with said
                  award ("Restricted Agreement"). The Committee, in exercising
                  its authority under the Plan and contingent on EMPLOYEE
                  fulfilling all his obligations under the term of this
                  Agreement, hereby modifies the Restricted Agreement to provide
                  that the 2,000 unvested shares of restricted stock awarded to
                  EMPLOYEE shall be fully vested as of the Effective Date. All
                  other terms and conditions of the Restricted Agreements shall
                  remain in full force and effect as written. This provision of
                  the Agreement shall be null and void and said 2,000 unvested
                  shares of restricted stock shall lapse under the terms of the
                  Restricted Agreement if EMPLOYEE, in the sole and absolute
                  discretion of UNIFI, does not meet all of his obligations
                  under the term of this Agreement in a timely manner.

SECTION 7.        STOCK OPTIONS - EMPLOYEE was granted stock options under
                  Unifi, Inc.'s 1992 Incentive Stock Option Plan, 1996
                  Non-qualified Stock Option Plan, 1996 Incentive Stock Option
                  Plan and 1999 Long Term Incentive Plan. Stock Option
                  Agreements dated November 24, 1993 for 2,500 stock options,
                  September 22, 1994 for 2,500 stock options, October 19, 1995
                  for 2,500 stock options, April 18, 1996 for 2,500 stock
                  options, April 17, 1997 for 2,500 stock options, October 22,
                  1998 for 2,500 stock options, October 21, 1999 for 40,224
                  options, October 2, 2001 for 15,000 stock options and January
                  23, 2002 for 50,000 stock options were entered into in
                  relation to the respective outstanding stock options granted.
                  It is hereby agreed that as long as EMPLOYEE has not breached
                  the terms of this Agreement, that the termination date for all
                  previously vested stock options under the aforesaid Stock
                  Option Agreements shall be modified and amended to mean April
                  30, 2005, and EMPLOYEE shall have until that date to exercise
                  all such previously vested options. It is further agreed that
                  at such time as EMPLOYEE has paid all amounts due and owing to
                  the Company hereunder (including those amounts due to the
                  Company under Section 8 hereof) any currently unvested options
                  shall vest and shall be exercisable by EMPLOYEE until April
                  30, 2005. If EMPLOYEE shall breach any of the provisions of
                  this Agreement, all such stock options (whether currently
                  vested or unvested) shall immediately terminate and EMPLOYEE
                  will not be entitled to exercise any of his stock options. The
                  terms of the aforementioned Stock Option Agreements shall
                  hereafter be deemed modified and amended to give effect to
                  this Section 7 and all such stock options shall be deemed and
                  treated as non-qualified stock options. All other terms of

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                  said Stock Option Agreements shall continue in full force and
                  effect as previously agreed to.

SECTION 8.        OTHER AGREEMENTS  -

                  a.       PROMISSORY NOTES - EMPLOYEE previously executed
                           Promissory Notes dated October 21, 1999 in the
                           principal amount of $25,171.88 and

                           December 31, 2000 in the principal amount of
                           $13,501.86 to UNIFI. The total amount due on said
                           promissory notes of $39,448.08 (the "Promissory Note
                           Balance") [$25,171.88 principal and $510.15 accrued
                           interest on the October 21, 1999 promissory note +
                           13,501.86 principal and $264.19 accrued interest on
                           the December 31, 2000 promissory note] shall be
                           deducted from the Severance Payment as set forth in
                           Section 1 hereof.

                  b.       COLLATERAL ASSIGNMENT SPLIT DOLLAR LIFE INSURANCE
                           AGREEMENT EFFECTIVE JANUARY 1, 2000 (the "Collateral
                           Agreement", the terms of which are incorporated
                           herein by reference) - On or before June 30, 2003,
                           EMPLOYEE will:

                           i.       Pay UNIFI an amount, as determined by Unifi
                                    in its sole discretion, equal to the
                                    short-fall in the cash surrender value of
                                    the Phoenix Policy (Phoenix Home Life Mutual
                                    Insurance Company policy #2764554) (the
                                    "Short-fall Payment", being the amount due
                                    UNIFI by the EMPLOYEE pursuant to the terms
                                    of the Collateral Assignment, the terms of
                                    which are incorporated herein by reference)
                                    and pursuant to Section 4.2 of the
                                    Collateral Agreement, assign to UNIFI all of
                                    his interest in the Policy. EMPLOYEE will
                                    execute such other and further documentation
                                    as requested by UNIFI (in UNIFI'S sole
                                    discretion) as is necessary to transfer any
                                    and all interests of EMPLOYEE in the Policy
                                    to UNIFI; or

                           ii.      Pay or cause his new Employer to pay to
                                    UNIFI an amount equal to the total aggregate
                                    premiums paid by UNIFI on the Phoenix
                                    Policy. After receipt of such reimbursement
                                    of total aggregate premiums by UNIFI, UNIFI
                                    shall assign all of its interests in the
                                    Policy and the Split Dollar Agreement to
                                    such new employer of EMPLOYEE.

                  Should EMPLOYEE notify UNIFI on or before June 10, 2003, that
                  he will be obligated to pay UNIFI the Short-fall Payment,
                  UNIFI shall pay to EMPLOYEE as an additional severance payment
                  on the regular payroll date for salaried employees of Unifi in
                  June 2003, an amount equal to the Short-fall Payment as
                  provided in subsection 8.b. above. Such additional severance
                  payment will be grossed up for all applicable federal and
                  state withholding taxes, as determined by


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                  UNIFI in its sole discretion, such that the net additional
                  proceeds shall equal the Short-fall Payment.

                  c.       ASSIGNMENT OF LIFE INSURANCE POLICY AS COLLATERAL
                           DATED JUNE 14, 1983 (the "Assignment Agreement", the
                           terms of which are incorporated herein by reference)
                           - On or before June 30, 2003, EMPLOYEE will:

                           i.       Pay or cause his new Employer to pay to
                                    UNIFI an amount equal to the total aggregate
                                    premiums paid by UNIFI on the Massachusetts
                                    Mutual Life Insurance Company Policy
                                    #6736109. After receipt of such
                                    reimbursement of total aggregate premiums by
                                    UNIFI, UNIFI shall assign all of its
                                    interests in the Mass Mutual Policy and the
                                    Executive Agreement to the EMPLOYEE or such
                                    new employer of EMPLOYEE; or

                           ii.      Notify Unifi that he is not going to repay
                                    the total aggregate premiums paid by UNIFI
                                    on the Mass Mutual Policy, but, instead
                                    assign to UNIFI all of his interest in the
                                    Mass Mutual Policy. EMPLOYEE will execute
                                    such other and further documentation as
                                    requested by UNIFI (in UNIFI'S sole
                                    discretion) as is necessary to transfer any
                                    and all interests of EMPLOYEE in the Mass
                                    Mutual Policy to UNIFI.

                  d.       COOPERATION - EMPLOYEE agrees to fully cooperate with
                           and assist UNIFI in transitioning his work
                           assignments to others in the Company.

SECTION 9.        DISCLOSURE OF CONFIDENTIAL INFORMATION - EMPLOYEE agrees that:

                  (A) For a period of five (5) years from the date of this
                  Agreement, he will not disclose or make available to any
                  person or other entity any trade secrets, confidential
                  information, as hereinafter defined, or "know-how" relating to
                  UNIFI'S, its affiliates' and subsidiaries', businesses without
                  written authority from UNIFI'S General Counsel, unless he is
                  compelled to disclose it by judicial process.

                           CONFIDENTIAL INFORMATION - shall mean all information
                  about UNIFI, its affiliates or subsidiaries, or relating to
                  any of their products or any phase of their operations, not
                  generally known to their competitors or which is not public
                  information, which EMPLOYEE knows or acquired knowledge of
                  during the term of his employment.

                  (B) DOCUMENTS - under no circumstances shall EMPLOYEE remove
                  from UNIFI'S offices any of UNIFI'S books, records, documents,
                  files, computer discs or information, reports, presentations,
                  customer lists, or any copies of such documents without
                  UNIFI'S written consent, nor shall he make any copies of


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                  UNIFI'S books, records, documents, or customer lists for use
                  outside of UNIFI, except as specifically authorized in writing
                  by UNIFI'S General Counsel.

SECTION 10.       NON-COMPETE -

                  (A) EMPLOYEE agrees that for a period of two (2) years from
                  the Effective Date he will not, in a capacity which actually
                  competes with UNIFI, seek employment or consulting
                  arrangements with or offer advice, suggestions or input to any
                  company, entity or person, which may be construed to be
                  UNIFI'S competitor, and

                  (B) EMPLOYEE agrees that he will not directly or indirectly,
                  for a period of two (2) years from the Effective Date, own any
                  interest in, other than ownership of less than two percent
                  (2%) of any class of stock of a publicly held corporation,
                  manage, operate, control, be employed by, render advisory
                  services to, act as a consultant to, participate in, assess or
                  be connected with any competitor, as hereinafter defined, in a
                  capacity which actually competes with Unifi, unless approved
                  by the General Counsel of UNIFI.

                           COMPETITOR - shall mean any company (incorporated or
                  unincorporated), entity or person engaged, with respect to
                  EMPLOYEE'S employment, in the business of developing,
                  producing, or distributing a product similar to any product
                  produced by UNIFI, its affiliates or subsidiaries, prior to
                  the Effective Date.

SECTION 11.       BREACH - EMPLOYEE understands and agrees that UNIFI'S
                  obligation to perform under this Agreement is conditioned upon
                  EMPLOYEE'S covenants and promises to UNIFI as set forth
                  herein. In the event EMPLOYEE breaches any such covenants and
                  promises, or causes any such covenants or promises to be
                  breached, UNIFI in its sole and absolute discretion shall have
                  the option to terminate its performance of its obligations
                  under this Agreement, and UNIFI shall have no further
                  liability or obligation to EMPLOYEE. EMPLOYEE acknowledges
                  that compliance with Sections 9 and 10 of this Agreement is
                  necessary to protect UNIFI'S businesses and goodwill; a breach
                  of said paragraph will do irreparable and continual damage to
                  UNIFI and an award of monetary damages would not be adequate
                  to remedy such harm; therefore, in the event he breaches or
                  threatens to breach this Agreement, UNIFI shall be entitled to
                  both a preliminary and permanent injunction in order to
                  prevent the continuation of such harm. Nothing in this
                  Agreement however, shall prohibit UNIFI from also pursuing any
                  other remedies.

SECTION 12.       RELEASES AND WAIVERS OF EACH PARTY - The parties hereto agree
                  as follows:

                  (A)      EMPLOYEE hereby fully, completely and unconditionally
                           releases and forever discharges any and all claims,
                           rights, demands, actions, obligations, liabilities,
                           and causes of action of any and every kind, which he
                           or his heirs, personal


                                       7

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                           representatives or assigns ever had, or now have, or
                           hereafter may have (based on events transpiring on or
                           before the Effective Date) against UNIFI, its
                           subsidiaries and affiliates and their respective
                           officers, directors, shareholders, representatives,
                           counsel and agents, in each case past or present, of
                           whatsoever kind and nature, in law, equity or
                           otherwise, arising out of or in any way connected
                           with his employment, association or other involvement
                           or any type, nature and kind with UNIFI. THIS RELEASE
                           AND WAIVER INCLUDES BUT IS NOT LIMITED TO CLAIMS
                           ARISING UNDER FEDERAL, STATE OR LOCAL LAWS
                           PROHIBITING EMPLOYMENT DISCRIMINATION (INCLUDING THE
                           AGE DISCRIMINATION IN EMPLOYMENT ACT, TITLE VII OF
                           THE CIVIL RIGHTS ACT OF 1964, AND THE AMERICAN WITH
                           DISABILITIES ACT) OR CLAIMS GROWING OUT OF ANY LEGAL
                           RESTRICTIONS ON THE COMPANY'S RIGHTS TO TERMINATE ITS
                           EMPLOYEES.

                  (B)      UNIFI hereby fully, completely and unconditionally
                           releases and forever discharges any and all claims,
                           rights, demands, actions, obligations, liabilities,
                           and causes of action of any and every kind, which it,
                           its successors or assigns ever had, or now have, or
                           hereafter may have (based on events transpiring on or
                           before the Effective Date) against EMPLOYEE, his
                           heirs, personal representatives or assigns, in each
                           case past or present, of whatsoever kind and nature,
                           in law, equity or otherwise, arising out of or in any
                           way connected with his employment, association or
                           other involvement with UNIFI.

                  (C)      EMPLOYEE ACKNOWLEDGES THAT HE HAS READ AND FULLY
                           UNDERSTANDS THE PROVISIONS OF THIS AGREEMENT, HAS HAD
                           SUFFICIENT TIME TO EVALUATE THE TERMS OF THIS
                           AGREEMENT, HAS BEEN ADVISED TO CONSULT WITH COUNSEL
                           BEFORE SIGNING THIS AGREEMENT, AND FREELY AND WITHOUT
                           RESERVATIONS ENTERS INTO THIS AGREEMENT AND THE
                           WAIVERS AND RELEASES CONTAINED HEREIN. EMPLOYEE
                           hereby further acknowledges that in making this
                           Agreement and Release that he understands that he is
                           relying upon his own judgment, belief and knowledge
                           of the extent and nature of said claims and payments
                           or that of his own advisors and expressly
                           acknowledges and confirms that he has not been
                           influenced to any extent whatsoever in making this
                           Agreement and Release by any representations or
                           statements regarding any payments, claims or
                           conditions or regarding any other matters as made by
                           any other person connected with or represented by any
                           of the Parties of this Agreement.

                  (D)      The Parties hereto agree that this is a compromised
                           settlement of a doubtful and disputed claim or right
                           to act and the payment of the funds herein and the
                           performance of this Agreement shall not be construed
                           as an admission of liability or responsibility on the
                           part of any of the Parties hereto other than
                           expressly provided for herein. This Agreement shall
                           be deemed to be strictly confidential by and between
                           these Parties and by express agreement and
                           understanding this

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<PAGE>

                           Agreement shall not be deemed, referenced, cited or
                           referred to by the Parties hereto or any other third
                           parties relating to EMPLOYEE'S employment with UNIFI,
                           nor shall this Agreement be used as evidence in any
                           litigation between and among the Parties to this
                           Agreement (or any other third parties) except to
                           establish only between the Parties to this Agreement
                           specifically the terms and conditions set forth
                           therein. Further, the Parties hereby covenant and
                           agree that upon the execution of this document and
                           prior thereto that they have not nor will they in the
                           future discuss with anyone the terms and conditions
                           of this Agreement or anything pertaining to the terms
                           and conditions of this Agreement, the negotiation of
                           the terms and conditions of this Agreement, the
                           settlement terms and conditions of this Agreement or
                           the details of this Agreement, except as required by
                           court order or with the written consent of all
                           parties to this Agreement. Further, all Parties
                           hereto agree that upon receipt of a subpoena or any
                           formal legal request for information covered by or
                           contained in this Agreement that they will as soon as
                           practical notify one another in writing of such
                           pending request to the persons at the addresses set
                           forth herein and that the terms of this Agreement
                           shall remain confidential and shall only be disclosed
                           by any Party hereto as that Party is ordered to do so
                           by a court of competent jurisdiction, or as required
                           for the preparation of any state or federal tax
                           return.

SECTION 13.       WAIVER OF RIGHTS - If, in one or more instances, either
                  Party fails to insist that the other Party perform any of the
                  terms of this Agreement, such failure shall not be construed
                  as a waiver by such Party of any past, present, or future
                  right granted under this Agreement, and the obligations of
                  both Parties under this Agreement shall continue in full force
                  and effect.

SECTION 14.       SURVIVAL - Except for a termination of this Agreement by
                  EMPLOYEE within seven days of the execution of this Agreement
                  as set forth in Section 22 of this Agreement, the obligations
                  contained in this Agreement shall survive the termination of
                  this Agreement. Additionally, the EMPLOYEE acknowledges that
                  the restrictions and covenants contained in paragraphs 9 and
                  10 are reasonable and necessary to protect the legitimate
                  business interests of the Company and will not impose an
                  economic hardship on the EMPLOYEE. If any provision of this
                  Agreement is held to be in any respect illegal, invalid or
                  unenforceable under present or future law, such provisions
                  shall be fully severable and this Agreement shall be construed
                  and enforced as if such illegal, invalid or unenforceable
                  provisions had never comprised a part hereof, and the
                  remaining provisions hereof shall remain in full force and
                  effect and shall not be affected by the illegal, invalid or
                  unenforceable provision or by its severance here from.
                  Furthermore, in lieu of such illegal, invalid or unenforceable
                  provision, the same shall be reformed and modified
                  automatically to be as similar in terms to such illegal,
                  invalid or unenforceable provision as may be possible and be
                  legal, valid and enforceable. In addition, the termination of
                  this Agreement shall not affect any of the rights or
                  obligations of either party arising prior to, or at the time
                  of, the termination of this

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<PAGE>

                  Agreement, or which may arise by any event causing the
                  termination of this Agreement.

SECTION 15.       NOTICES - Any notice required or permitted to be given
                  under this Agreement shall be sufficient, if in writing and if
                  sent by registered or certified mail, postage prepaid, or
                  telecopier to:

                  EMPLOYEE
                  Lee Gordon
                  7072 Mcleansville Rd
                  Brown Summit, NC  27214

                  and to:

                  UNIFI
                  Attn: Charles F. McCoy
                  7201 W. Friendly Avenue (27410)
                  P.O. Box 19109
                  Greensboro, NC  27419-9109
                  Fax: (336) 856-4364

SECTION 16.       ASSIGNMENT - The rights and obligations of UNIFI under
                  this Agreement shall inure to the benefit of and be binding
                  upon its successors and assigns. The rights and obligations of
                  EMPLOYEE under this Agreement shall inure to the benefit of
                  and be binding upon his heirs, personal representative,
                  successors and assigns. This Agreement may not be assigned or
                  otherwise transferred voluntarily or involuntarily by
                  EMPLOYEE.

SECTION 17.       ARBITRATION - In the event of any differences of opinion
                  or disputes, between EMPLOYEE and UNIFI, with respect to the
                  construction or interpretation of this Agreement or the
                  alleged breach thereof, which cannot be settled amicably by
                  agreement of the Parties, such disputes shall be submitted to
                  and determined by arbitration by a single arbitrator in the
                  City of Greensboro, North Carolina, in accordance with the
                  rules of the American Arbitration Association and judgment
                  upon the award shall be final, binding and conclusive upon the
                  Parties and may be entered in the highest court, state or
                  federal, having jurisdiction.

SECTION 18.       APPLICABLE LAW - This Agreement shall be interpreted and
                  construed under the laws of North Carolina.

SECTION 19.       ENTIRE AGREEMENT - This Agreement contains the entire
                  agreement of the Parties and supersedes all prior agreements
                  and understandings, oral or written, if any, relating to the
                  EMPLOYEE'S employment and termination of employment with the
                  Company, except that any Confidentiality Agreements that were
                  previously executed by EMPLOYEE before or during the term of
                  his employment with UNIFI remain in full force and effect. If
                  there are any conflicts in the terms of this Agreement and
                  such other Confidentiality Agreements, the terms of this

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                  Agreement shall control. This Agreement may not be changed or
                  altered, except by an agreement in writing signed by the Party
                  against whom enforcement of any waiver, change, modification,
                  extension or discharge is sought.

SECTION 20.       COUNTERPARTS. This Agreement may be executed in multiple
                  counterparts, each of which shall be deemed an original for
                  all purposes and all of which shall be deemed collectively to
                  be one agreement, but in making proof hereof it shall be
                  necessary to exhibit only one such counterpart.

SECTION 21.       CONTINUING OBLIGATIONS. EMPLOYEE hereby agrees that he
                  will execute from time to time after the Effective Date any
                  and all such documents, agreements, instruments,
                  certifications, consents, statements, waivers, and/or releases
                  as UNIFI shall request as is necessary to implement and
                  institute the intents and purposes of this Agreement.
                  Additionally, EMPLOYEE acknowledges and agrees that UNIFI
                  shall have the right to set off any obligations owed by
                  EMPLOYEE to UNIFI against the Severance Payment and/or Monthly
                  Payments and other benefits granted to EMPLOYEE by UNIFI under
                  the terms of this Agreement.


SECTION 22.       EMPLOYEE'S RIGHT TO REVOKE - NOTWITHSTANDING OTHER
                  PROVISIONS HEREIN TO THE CONTRARY, EMPLOYEE HAS THE RIGHT TO
                  REVOKE THIS AGREEMENT AND ACCEPTANCE OF SEVERANCE PAY PROVIDED
                  HEREIN WITHIN SEVEN (7) DAYS FROM THE DATE EMPLOYEE EXECUTES
                  THIS AGREEMENT. TO EXERCISE THIS RIGHT TO REVOKE, EMPLOYEE
                  MUST NOTIFY THE COMPANY IN WRITING OF HIS DECISION TO REVOKE
                  AS SET FORTH IN SECTION 15 OF THIS AGREEMENT.






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<PAGE>


         IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under their respective hands and seals as of the day and year first above
written.


                                            EMPLOYEE:


                                            OTTIS LEE GORDON              (Seal)
                                            ------------------------------------
                                            OTTIS LEE GORDON



                                            UNIFI, INC.


                                            BY: CHARLES F. MCCOY
                                                --------------------------------
                                                CHARLES F. MCCOY
                                                Vice President




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<PAGE>


                                   EXHIBIT "A"

                                  RESIGNATION


         Pursuant to the terms of an Agreement effective April 30, 2003, by and
between UNIFI, INC. (the "Company") (the terms of which Agreement are
incorporated herein by reference) and OTTIS LEE GORDON ("EMPLOYEE"), EMPLOYEE
does hereby resign as an employee, officer, director, manager or from any other
positions of the Company and/or any of its subsidiaries or affiliates.

         This resignation is effective the 30th day of April 2003.



                                               OTTIS LEE GORDON           (SEAL)
                                               ---------------------------
                                               OTTIS LEE GORDON







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