UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 19, 2025
UNIFI, INC.
(Exact name of registrant as specified in its charter)
New York | 1-10542 | 11-2165495 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
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7201 West Friendly Avenue Greensboro, North Carolina |
27410 | |||
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (336) 294-4410
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, par value $0.10 per share | UFI | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. | Entry into a Material Definitive Agreement. |
Amendment to Real Estate Purchase and Sale Agreement
As previously disclosed, on April 10, 2025, Unifi Manufacturing, Inc. (“UMI”), a wholly owned subsidiary of Unifi, Inc. (the “Company”), and Enovum Data Centers Corp. (the “Original Buyer”), a Canadian corporation, entered into a Real Estate Purchase and Sale Agreement (the “Purchase Agreement”). Pursuant to the Purchase Agreement, UMI agreed to sell to Original Buyer, and Original Buyer agreed to purchase from UMI, an industrial/manufacturing building together with the underlying land located in Madison, North Carolina, as well as certain machinery and equipment located thereon (the “Property”).
On May 16, 2025, Original Buyer assigned all of its right, title and interest under the Purchase Agreement to Enovum NC-1 Bidco, LLC (the “Buyer”), a Delaware limited liability company.
On May 19, 2025, UMI and Buyer entered into an amendment to the Purchase Agreement (the “Purchase Agreement Amendment” and the Purchase Agreement, as amended by the Purchase Agreement Amendment, the “Amended Purchase Agreement”) in order to, among other things, (a) amend the date of the closing of the transaction (the “Closing”) to May 20, 2025, (b) waive the Energy Study Contingency (as defined in the Amended Purchase Agreement), and (c) reduce the purchase price payable at Closing to $45 million, subject to the potential payment of deferred compensation to UMI in the amount of (i) $8.0 million, if certain energy supply conditions are met within two years of Closing, (ii) $5.0 million (instead of $8.0 million), if the same conditions are not met within two years of Closing but are met within three years of Closing, and (iii) up to $5.0 million, if certain additional energy conditions beyond those referred to in (c)(i) and (ii) are met within four years of Closing.
The preceding summary of the Purchase Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the Purchase Agreement Amendment, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated into this Item 1.01 by reference.
Third Amendment to Second Amended and Restated Credit Agreement
On May 19, 2025, the Company entered into a Third Amendment (the “Third Amendment”) to its Second Amended and Restated Credit Agreement (as amended to date, the “Credit Agreement”), dated as of October 28, 2022, by and among the Company, UMI, the Guarantor party thereto, the lenders from time to time party thereto and Wells Fargo Bank, National Association, as agent.
The Third Amendment amended the Credit Agreement to (a) permit UMI to consummate the transaction contemplated by the Amended Purchase Agreement and (b) permit UMI to allocate a portion of the net proceeds from such transaction (including any deferred compensation payable pursuant to the terms of the Amended Purchase Agreement) to repay revolving loans outstanding under the Credit Agreement, after the application of $25 million of such net proceeds toward the term loans outstanding under the Credit Agreement.
The preceding summary of the Third Amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the Third Amendment, a copy of which is filed as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated into this Item 1.01 by reference.
Item 2.01. | Completion of Acquisition or Disposition of Assets. |
The disclosure contained in Item 1.01 is incorporated herein by reference.
The Closing occurred on May 20, 2025. The net proceeds of the transaction were used to repay a portion of the principal balance of term loans and revolving loans outstanding under the Credit Agreement as provided in the Third Amendment. There were not any material relationships, other than in respect of the transactions contemplated by the Amended Purchase Agreement, between the Buyer and the Company or any of its affiliates, or any director or officer of the Company, or any associate of any such director or officer.
Item 7.01. | Regulation FD Disclosure. |
On May 21, 2025, the Company issued a press release announcing the Closing. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated into this Item 7.01 by reference.
The information contained in Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.1 attached hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly provided by specific reference in such a filing.
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits
Exhibit No. |
Description | |
4.1 | Third Amendment to Second Amended and Restated Credit Agreement, dated May 19, 2025, by and among Unifi, Inc. and certain of its domestic affiliates, Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto | |
10.1† | Amendment to Real Estate Purchase and Sale Agreement, dated May 19, 2025, by and between Unifi Manufacturing, Inc. and Enovum NC-1 Bidco, LLC | |
99.1 | Press Release, dated May 21, 2025 | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
† Certain portions of this exhibit have been redacted in accordance with Item 601(b)(10) of Regulation S-K.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
UNIFI, INC. | ||||||
Date: May 21, 2025 |
By: |
/s/ ANDREW J. EAKER |
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Andrew J. Eaker | ||||||
Executive Vice President & Chief Financial Officer |
Exhibit 4.1
THIRD AMENDMENT TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS THIRD AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”), dated as of May 19, 2025, and effective as of the Third Amendment Effective Date, is by and among UNIFI MANUFACTURING, INC., a North Carolina corporation (“Unifi Manufacturing”), UNIFI, INC., a New York corporation (“Parent”; Unifi Manufacturing and Parent, each, a “Borrower” and, collectively, the “Borrowers”), UNIFI SALES & DISTRIBUTION, INC., a North Carolina corporation (“Guarantor”) (the Borrowers and Guarantor, each, a “Loan Party” and, collectively, the “Loan Parties”), the Lenders (as such term is defined below) party hereto, and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, “Agent”).
W I T N E S S E T H:
WHEREAS, reference is made to that certain Second Amended and Restated Credit Agreement dated as of October 28, 2022, by and among the Borrowers, the lenders from time to time party thereto (each, a “Lender” and, collectively, the “Lenders”), the Persons party thereto, and the Agent (as amended by that certain First Amendment to Second Amended and Restated Credit Agreement dated as of September 5, 2024, that certain Second Amendment to Second Amended and Restated Credit Agreement dated as of April 10, 2025, and as the same may have been further amended, restated, supplemented, or otherwise modified from time to time before the date hereof, the “Credit Agreement”); and
WHEREAS, the Borrowers have requested that the Agent and the Lenders agree to certain amendments to the Credit Agreement as set forth in this Agreement, and the Agent and the Lenders party hereto have agreed to such amendments to the Credit Agreement, subject to the terms and conditions of this Agreement.
NOW THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and of the Loans and other extensions of credit heretofore, now or hereafter made to, or for the benefit of, the Borrowers by the Lenders, the Borrowers, the Agent, and the Lenders party hereto agree as follows:
SECTION 1. Defined Terms; Incorporation of Recitals. Capitalized terms used but not defined herein shall have the respective meanings assigned to such terms in the Credit Agreement. This Agreement constitutes a Loan Document. The recitals to this Agreement are incorporated by reference into this Agreement.
SECTION 2. Amendments to Credit Agreement.
(a) Amendments to Schedule 1.1. Schedule 1.1 to the Credit Agreement is amended by including the following new definitions in proper alphabetical order:
“Permitted Madison Plant 3 Facility Disposition Upside Proceeds” means that portion of the Net Cash Proceeds of the Permitted Madison Plant 3 Facility Disposition constituting deferred compensation as set forth in Section 2.4 of that certain Real Estate Purchase and Sale Agreement, dated as of April 10, 2025, by and between Unifi Manufacturing and Enovum Data Centers Corp. a Canadian corporation, as amended by that certain Amendment to Real Estate Purchase and Sale Agreement, dated as of May 19, 2025, in each case as in effect on the Third Amendment Effective Date.
“Third Amendment Effective Date” means May 19, 2025.
(b) Amendments to Schedule 1.1. The definition of “Permitted Madison Plant 3 Facility Disposition” is hereby amended and restated in its entirety to read as follows:
“Permitted Madison Plant 3 Facility Disposition” means the sale by Unifi Manufacturing of its right, title and interests in the Madison Plant 3 Facility, so long as (a) the aggregate Net Cash Proceeds received by Unifi Manufacturing substantially contemporaneously with the consummation of such sale equals or exceed $43,000,000.00; (b) all amounts payable to Unifi, Inc., or any of its Subsidiaries or Affiliates in connection with such sale are paid directly to the Agent’s Account for application as set forth herein; (c) at the time such sale is consummated and immediately after giving effect thereto, no Default or Event of Default exists; and (d) such sale occurs on or before July 31, 2025.
(c) Amendments to Section 2.4. Section 2.4(f)(ii) of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
(ii) Each prepayment pursuant to Section 2.4(e)(ii), (iii) or (iv) shall (A) so long as no Application Event shall have occurred and be continuing, be applied, first, to the outstanding principal amount of the Term Loan until paid in full, second, to the outstanding principal amount of the Revolving Loans, until paid in full, and third, to cash collateralize the Letters of Credit in an amount equal to 105% of the then outstanding Letter of Credit Usage, and (B) if an Application Event shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(ii); provided, however, (x) the Net Cash Proceeds from the Permitted Parkdale Disposition and the Permitted W-3 Warehouse Disposition shall (1) so long as no Application Event shall have occurred and be continuing, be applied, first, to the outstanding principal amount of the Revolving Loans, until paid in full, and, second, to the Borrowers in accordance with their lawful instructions, and (2) if an Application Event shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(ii), and (y) the Net Cash Proceeds from the Permitted Madison Plant 3 Facility Disposition shall (1) so long as no Application Event shall have occurred and be continuing, be applied, first, to the outstanding principal amount of the Term Loan in an amount equal to the greater of (i) $25,000,000 and (ii) 50% of the Net Cash Proceeds of the Permitted Madison Plant 3 Facility Disposition (other than the Permitted Madison Plant 3 Facility Disposition Upside Proceeds), rounded up to the nearest $500,000 increment, and, second, the balance (including any portion constituting Permitted Madison Plant 3 Facility Disposition Upside Proceeds) to the outstanding principal amount of the Revolving Loans, and (2) if an Application Event shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(ii). Each such prepayment of the Term Loan shall be applied against the remaining installments of principal of the Term Loan in the inverse order of maturity (for the avoidance of doubt, any amount that is due and payable on the Maturity Date shall constitute an installment).
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SECTION 3. Conditions to Effectiveness. The effectiveness of the amendments set forth in Section 2 is subject to satisfaction, on or before May 19, 2025, of the following conditions precedent (the date of such satisfaction being the “Third Amendment Effective Date”):
(a) (i) each Loan Party shall have executed and delivered to the Agent a counterpart of this Agreement, (ii) each Lender shall have executed and delivered to the Agent a counterpart of this Agreement, and (iii) the Agent shall have executed and delivered a counterpart of this Agreement;
(b) the representations and warranties of the Loan Parties contained in Section 4 hereof shall be true and correct on and as of the Third Amendment Effective Date; and
(c) before and immediately after the Third Amendment Effective Date, no Event of Default shall have occurred and be continuing.
SECTION 4. Representations and Warranties of the Loan Parties. Each Loan Party hereby represents and warrants on and as of the Third Amendment Effective Date that:
(a) after giving effect to this Agreement, the representations and warranties of each Loan Party contained in the Loan Documents shall be true and correct in all material respects (without duplication of any materiality qualifier contained therein) on and as of the Third Amendment Effective Date, except to the extent that such representations and warranties expressly relate to an earlier date (in which event such representations and warranties were true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date);
(b) this Agreement has been duly executed and delivered by each Loan Party and this Agreement constitutes a legal, valid, and binding obligation of such Loan Party, enforceable against such Loan Parties in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally;
(c) the Security Documents and all of the Collateral described therein do, and shall continue to, secure the payment of all of the Obligations; and
(d) the execution and delivery by each Loan Party of this Agreement and the performance by each Loan Party of the Credit Agreement (as amended hereby) have been duly authorized by all necessary corporate or limited liability company action (as applicable) and do not (i) contravene the terms of any of that Person’s Governing Documents; (ii) conflict with or result in any breach or contravention of, or result in the creation of any Lien (other than Permitted Liens) under, any material agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound or any order, injunction, writ or decree of any Governmental Authority to which such Person or its assets are subject, except as would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect; (iii) violate any provision of federal, state, or local law or regulation applicable to any Loan Party or its Domestic Subsidiaries in any respect, except, as would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect; or (iv) require any approval of any holder of Equity Interests of a Loan Party or any approval or consent of any Person under any material agreement of any Loan Party, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of material agreements, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Effect.
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SECTION 5. Effects on Loan Documents.
(a) On and after the Third Amendment Effective Date, each reference in any Loan Document to “the Credit Agreement” shall mean and be a reference to the Credit Agreement as amended hereby and each reference in the Credit Agreement to “this agreement,” “hereunder,” “hereof” or words of like import shall mean and be a reference to the Credit Agreement as amended hereby.
(b) Except as specifically set forth herein (i) all Loan Documents shall continue to be in full force and effect and are hereby in all respects ratified and confirmed; (ii) no other changes or modifications to the Credit Agreement or any of the other Loan Documents are intended or implied, and in all other respects, the Credit Agreement and each of the other Loan Documents is hereby specifically ratified, restated and confirmed by all parties hereto as of the date hereof (and after giving effect to the terms of this Agreement); and (iii) the execution, delivery and effectiveness of this Agreement shall not operate as a waiver of any right, power, or remedy of Agent, any Lender, the Swing Lender, or any Issuing Lender under any of the Loan Documents nor constitute a waiver of any provision of the Loan Documents or in any way limit, impair or otherwise affect the rights and remedies of any of them under the Loan Documents, except to the extent expressly set forth herein.
(c) To the extent that any provision of the Credit Agreement (as amended hereby) or any of the other Loan Documents are inconsistent with the provisions of this Agreement, the provisions of this Agreement shall control.
SECTION 6. CHOICE OF LAW AND VENUE; JURY TRAIL WAIVER; JUDICIAL REFERENCE PROVISION. THIS AGREEMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL, AND JUDICIAL REFERENCE PROVISION SET FORTH IN SECTION 12 OF THE CREDIT AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.
SECTION 7. Miscellaneous.
(a) This Agreement shall bind and inure to the benefit of the respective successors and permitted assigns of each of the parties hereto.
(b) Each Loan Party acknowledges and agrees that the execution, delivery, and performance of this Agreement shall not create (nor shall such Loan Party rely upon the existence of or claim or assert that there exists) any obligation of Agent or any Lender to consider or agree to any other amendment of or waiver or consent with respect to the Credit Agreement or any other instrument or agreement to which Agent or any Lender is a party (collectively, an “Additional Amendment” or “Consent”), and if Agent and the Lenders subsequently agree to consider any requested Additional Amendment or Consent, neither the existence of this Agreement nor any other conduct of Agent or the Lenders related hereto, shall be of any force or effect on the Lenders’ consideration or decision with respect to any such requested Additional Amendment or Consent, and the Lenders shall not have any obligation whatsoever to consider or agree to any such Additional Amendment or Consent.
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(c) To induce Agent and Lenders to enter into this Agreement, each Loan Party acknowledges, stipulates, and agrees that (i) all of the Obligations are absolutely due and owing by Loan Parties to Agent and Lenders in accordance with the terms and provisions of the Credit Agreement as amended hereby, without defense, deduction, offset or counterclaim (and, to the extent any Loan Party had any defense, deduction, offset or counterclaim on the date hereof, the same is hereby waived by such Loan Party); (ii) the Loan Documents (to the extent amended hereby) to which such Loan Part is a party are legal, valid and binding obligations of such Loan Party enforceable against such Loan Party in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally; (iii) the Liens granted by each Loan Party to Agent in the Collateral are valid and duly perfected, first priority Liens, subject only to Permitted Liens; (iv) each of the recitals contained at the beginning of this Agreement is true and correct; (v) if such Loan Party is a Guarantor, such Loan Party reaffirms and ratifies its guaranty obligations under the Loan Documents to which it is a party and agrees that none of such obligations thereunder shall be diminished or limited in any way by the execution and delivery of this Agreement; and (vi) before executing this Agreement, each Loan Party consulted with and had the benefit of advice of legal counsel of its own selection and has relied upon the advice of such counsel, and in no part upon the representation of Agent, any Lender or any counsel to Agent or any Lender concerning the legal effects of this Agreement or any provision hereof.
(d) Nothing under this Agreement shall extinguish the Obligations under the Credit Agreement. Nothing expressed or implied in this Agreement, the Credit Agreement (as amended hereby), or any other document contemplated hereby shall be construed as a release or other discharge of any Loan Party under the Credit Agreement or any other Loan Document from any of its obligations and liabilities thereunder, and except as expressly provided in this Agreement, such obligations are in all respects continuing with only the terms being modified as provided in this Agreement. This Agreement shall not constitute a novation of the Credit Agreement or any other Loan Document.
(e) In consideration of, among other things, the Lenders’ execution and delivery of this Agreement, each Loan Party, on behalf of itself and respective agents, representatives, officers, directors, advisors, employees, subsidiaries, affiliates, successors and assigns (collectively, “Releasors”), hereby forever agrees and covenants not to sue or prosecute against any Releasee (as hereinafter defined) and hereby forever waives, releases and discharges, to the fullest extent permitted by law, each Releasee from any and all claims (including, without limitation, cross-claims, counterclaims, rights of set-off and recoupment), actions, causes of action, suits, debts, accounts, interests, liens, promises, warranties, damages and consequential damages, demands, agreements, bonds, bills, specialties, covenants, controversies, variances, trespasses, judgments, executions, costs, expenses or claims whatsoever, that such Releasor now has or hereafter may have, of whatsoever nature and kind, whether known or unknown, whether now existing or hereafter arising, whether arising at law or in equity (collectively, the “Claims”), against the Agent and any Lender in any capacity and any of their respective affiliates, subsidiaries, shareholders and “controlling persons” (within the meaning of the federal securities laws), and their respective successors and assigns and each and all of the officers, directors, employees, agents, attorneys, advisors and other Representatives of each of the foregoing (collectively, the “Releasees”), based in whole or in part on facts, whether or not now known, existing on or before the Third Amendment Effective Date, that relate to, arise out of or otherwise are in connection with: (i) any or all of the Loan Documents or transactions contemplated thereby or any actions or omissions in connection therewith, or (ii) any aspect of the dealings or relationships between or among Loan Parties and any other Releasor, on the one hand, and the Agent or any Lender, on the other hand, relating to any or all of the documents, transactions, actions or omissions referenced in clause (i) above. In entering into this Agreement, each Loan Party consulted with, and has been represented by, legal counsel and expressly disclaims any reliance on any representations, acts or omissions by any of the Releasees and hereby agrees and acknowledges that the validity and effectiveness of the releases set forth above do not depend in any way on any such representations, acts and/or omissions or the accuracy, completeness or validity thereof. The provisions of this Section shall survive the termination of this Agreement, the Credit Agreement, the other Loan Documents, payment in full of the Obligations and the termination of the Commitments of the Lenders.
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(f) The Loan Parties shall execute and deliver such additional documents and take such additional action as may be reasonably requested by Agent to effectuate the provisions and purposes hereof.
(g) The illegality or unenforceability of any provision of this Agreement or any instrument or agreement required hereunder or contemplated herein shall not in any way affect or impair the legality or enforceability of the remaining provisions of this Agreement or any other instrument or agreement required or contemplated hereunder.
(h) References in this Agreement to any Section or subsection are, unless otherwise specified, to such Section or Subsection of this Agreement.
(i) This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Execution of any such counterpart may be by means of (a) an electronic signature that complies with the federal Electronic Signatures in Global and National Commerce Act, as in effect from time to time, state enactments of the Uniform Electronic Transactions Act, as in effect from time to time, or any other relevant and applicable electronic signatures law; (b) an original manual signature; or (c) a faxed, scanned, or photocopied manual signature. Each electronic signature or faxed, scanned, or photocopied manual signature shall for all purposes have the same validity, legal effect, and admissibility in evidence as an original manual signature. Agent reserves the right, in its discretion, to accept, deny, or condition acceptance of any electronic signature on this Agreement. Any party delivering an executed counterpart of this Agreement by faxed, scanned or photocopied manual signature shall also deliver an original manually executed counterpart, but the failure to deliver an original manually executed counterpart shall not affect the validity, enforceability and binding effect of this Agreement.
(j) To the extent any Person party hereto is an Issuing Lender or the Swing Lender, such Person, in such capacities, agrees and consents to the terms of this Agreement, subject to the satisfaction of the conditions precedent set forth herein.
[Continued on following page.]
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IN WITNESS WHEREOF, each of the parties hereto have caused their duly authorized officers to execute and deliver a counterpart of this Agreement as of the date first above written.
BORROWERS: |
UNIFI MANUFACTURING, INC. |
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By: |
/s/ Andrew J. Eaker |
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Name: Andrew J. Eaker |
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Title: Executive Vice President and Chief Financial Officer |
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UNIFI, INC. |
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By: |
/s/ Andrew J. Eaker |
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Name: Andrew J. Eaker |
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Title: Executive Vice President and Chief Financial Officer |
GUARANTOR: |
UNIFI SALES & DISTRIBUTION, INC. |
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By: |
/s/ Andrew J. Eaker |
|||||
Name: Andrew J. Eaker |
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Title: Executive Vice President and Chief Financial Officer |
[UNIFI—THIRD AMENDMENT TO SECOND A&R CREDIT AGREEMENT]
AGENT AND LENDERS: |
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent and as a Lender |
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By: |
/s/ Susan C. Carr |
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Name: Susan C. Carr |
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Title: |
Authorized Signatory |
[UNIFI—THIRD AMENDMENT TO SECOND A&R CREDIT AGREEMENT]
BANK OF AMERICA, N.A., as a Lender |
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By: |
/s/ Tom Buda |
|
Name: Tom Buda |
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Title: SVP |
[UNIFI—THIRD AMENDMENT TO SECOND A&R CREDIT AGREEMENT]
FIRST NATIONAL BANK, as a Lender |
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By: |
William Giddes |
|
Name: |
William Giddes |
|
Title: |
Assistant Vice President |
[UNIFI—THIRD AMENDMENT TO SECOND A&R CREDIT AGREEMENT]
Exhibit 10.1
*** Certain portions of this exhibit that include immaterial and confidential information have been omitted. ***
AMENDMENT TO
REAL ESTATE PURCHASE AND SALE AGREEMENT
THIS AMENDMENT TO REAL ESTATE PURCHASE AND SALE AGREEMENT (this “Amendment”) is made and entered into as of May 19, 2025 (the “Amendment Effective Date”), between UNIFI MANUFACTURING, INC., a North Carolina corporation (“Seller”), and ENOVUM NC-1 BIDCO, LLC, a Delaware limited liability company (“Buyer”) (Buyer and Seller are referred to herein individually as a “Party” and, together, as the “Parties”).
WITNESSETH:
WHEREAS, Seller and ENOVUM DATA CENTERS CORP., a Canadian corporation (“Original Buyer”) entered into that certain Real Estate Purchase and Sale Agreement (the “Agreement”) dated April 10, 2025. Unless otherwise provided herein, capitalized terms used in this Amendment shall have the meanings ascribed to such terms in the Agreement, and all references herein to the Agreement shall mean the Agreement as hereby amended;
WHEREAS, Original Buyer assigned all of its right, title and interest as Buyer under the Agreement to Buyer, and Buyer assumed all of Original Buyer’s obligations as Buyer under the Agreement, pursuant to that certain Assignment of Real Estate Purchase and Sale Agreement dated May 16, 2025 (the “Assignment”). In accordance with Section 9.3 of the Agreement, the Assignment did not release Original Buyer of its obligations under the Agreement.
WHEREAS, Section 13 of the Agreement states that the obligation of the Buyer to close the transactions contemplated by the Agreement are conditioned on the receipt of an Energy Study from Duke Energy verifying that within four (4) years from the Closing Date, Duke Energy will be able to supply 100 megawatts to the Property (the “Energy Study Contingency”);
WHEREAS, Buyer has received a draft Letter Agreement for the Purchase of Electric Power dated May 16, 2025 (the “Letter Agreement”) whereby Duke Energy has agreed to use commercially reasonable efforts to achieve 24 megawatts of service to the Property by September 1, 2025, 40 megawatts of service to the Property by April 1, 2026 and 99 megawatts of service to the Property within four (4) years of the effective date of the Letter Agreement, subject to the terms set forth in the Letter Agreement;
WHEREAS, Buyer has represented that the Energy Study Contingency has not been satisfied; and
WHEREAS, Buyer has requested certain modifications to the Agreement before it will agree to waive the Energy Study Contingency, and Seller has agreed to make such modifications in exchange for Buyer waiving the Energy Study Contingency, proceeding to Closing on May 20, 2025, and agreeing to certain other modifications, all of which agreed to modifications are set forth in this Amendment.
NOW, THEREFORE, for and in consideration of the covenants and agreements herein contained, and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:
1. Schedule 1.2. Schedule 1.2 of the Agreement is amended to indicate that item 388 (AIR COMPRESSOR, 350-HP, 1600-CFM, 100-PSIG, SKID MOUNT, TOTALLY ENCLOSED, W/ 2010 INGERSOLL-RAND NVC2400A40N AIR DRYER, 2000-CFM AT 200-PSIG, S/N 508005) is Excluded rather than Included.
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2. Purchase Price/Earnout.
(a) Section 2 of the Agreement is amended to indicate that the Purchase Price shall be Forty Five Million and no/100 Dollars (USD $45,000,000.00).
(b) |
A new Section 2.4 is added which reads as follows: |
2.4 |
Promptly after the Closing Date, Buyer shall use commercially reasonable efforts to obtain as promptly as possible an Electric Services Agreement (an “ESA”) with Duke Energy which provides for at least 99 megawatts of service to the Property to be provided within two (2) years of the Closing Date (as defined herein). Buyer further agrees that Seller shall be entitled to communicate directly with Duke Energy concerning the foregoing and shall provide to Duke Energy whatever authorization Duke Energy may require to allow direct communications between Seller and Duke Energy. Buyer and Seller agree that they will cooperate with each other in all reasonable respects with the efforts of Buyer to obtain increased electrical capacity for the Property from Duke Energy. Seller will not take any action that would hamper or interfere with the efforts of Buyer to obtain increased electrical capacity at any time; provided, however, that Seller taking action to procure electrical capacity for Seller’s other facilities shall not be considered a violation of this obligation. |
2.4.1 |
Buyer agrees that if either (A) Buyer defaults in its obligations to use commercially reasonable efforts as set forth in the preceding paragraph, or (B) by no later than two (2) years after the Closing Date: (i) Duke Energy provides an ESA on commercially reasonable terms without unreasonable infrastructure costs requiring contribution from Buyer and pricing consistent with comparable filed rates that similarly situated data center electric customers would accept for the provision of 99 megawatts to the Property within such two (2) year period of the Closing Date; or (ii) the Property is actually receiving 99 megawatts, Buyer shall pay to Seller the amount of Eight Million and No/100 Dollars (USD $8,000,000.00) within thirty (30) days after the occurrence of any of (A) through (B) above. |
2.4.2 |
Buyer agrees that if neither of the events described in (A) or (B) of Section 2.4.1 occurs within the two (2) year period immediately following the Closing Date, and thereafter but not later than three (3) years after the Closing Date (x) Duke Energy provides an ESA on commercially reasonable terms without unreasonable infrastructure costs requiring contribution from Buyer and pricing consistent with comparable filed rates that similarly situated data center electric customers would accept for the provision of 99 megawatts to the Property within three (3) years of the Closing Date; or (y) the Property is actually receiving 99 megawatts, |
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Buyer shall pay to Seller the amount of Five Million and No/100 Dollars (USD $5,000,000.00) within thirty (30) days after the occurrence of (x) or (y) above. In the event that none of the conditions described in Sections 2.4.1 and 2.4.2 have occurred within three (3) years from the Closing Date, the Buyer shall have no obligation to pay any amounts to the Seller under Sections 2.4.1 or 2.4.2. |
2.4.3 |
Buyer agrees to use commercially reasonable efforts to obtain electric service beyond the 99 megawatts contemplated in the preceding paragraphs. Buyer agrees that for each additional megawatt of service above 99 megawatts to the Property (x) for which Duke Energy provides an ESA on commercially reasonable terms without unreasonable infrastructure costs requiring contribution from Buyer and pricing consistent with comparable filed rates that similarly situated data center electric customers would accept; or (y) which the Property is actually receiving, in each case on or before four (4) years after the Closing Date, Buyer shall pay to Seller Two Hundred Thousand and No/100 Dollars (USD $200,000.00) per megawatt over 99 megawatts, up to a maximum payment pursuant to this paragraph of Five Million and No/100 Dollars (USD $5,000,000) (the “Bonus Cap”). Such amount(s) shall be payable within thirty (30) days after the occurrence of (x) or (y) above (it being understood that Buyer may have to make multiple payments over the course of the four (4) year duration of this Section 2.4.3 if there are multiple occurrences of the events described in (x) and (y) above). Buyer shall have no obligation to pay any amounts to Seller: (i) for capacity over 99 megawatts that is not achieved as provided in this Section 2.4.3 within four (4) years of the Closing Date; or (ii) in excess of the Bonus Cap. The obligations of Buyer to Seller under this Section 2.4.3 are independent of the obligations under Sections 2.4.1 and 2.4.2. |
2.4.4 |
The obligations set forth in this Section 2.4 shall survive the Closing. |
3. Closing Date. Section 5.1 of the Agreement is amended and restated in its entirety to read as follows: “The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place on May 20, 2025 (the “Closing Date”).”
4. Assignment Does Not Release Buyer. The last sentence of Section 9.3 of the Agreement is amended and restated in its entirety to read as follows: “Notwithstanding the foregoing, Buyer shall not be released of its obligations hereunder as a result of any assignment”.
5. Waiver of Energy Study Contingency. The Buyer hereby waives the Energy Study Contingency. Accordingly, Section 12.2 and the second paragraph of Section 13 of the Agreement are deleted in their entirety.
6. Occupancy Termination Date. Section 14 of the Agreement is amended to change the Occupancy Termination Date to [*****]. The Parties further agree that the Occupancy Agreement shall be substantially in the form attached hereto as Exhibit A.
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7. Successors and Assigns. This Amendment will bind and inure to the benefit of each Party and their respective permitted successors, assigns, and delegates.
8. Counterparts. This Amendment may be executed in several counterparts, each of which shall be deemed an original, and all of such counterparts together shall constitute one and the same instrument. Delivery of a facsimile or electronic copy of this Amendment executed by a Party hereto shall be deemed to constitute delivery of an original hereof executed by such Party. This Amendment shall be governed by and construed in accordance with the laws of the State of North Carolina.
9. Affirmation of Agreement. Except as modified by this Amendment, all of the other terms, conditions and requirements of the Agreement are ratified and affirmed by each of Buyer and Seller.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, Seller and Buyer have caused this Amendment to be executed as of the Amendment Effective Date.
SELLER: |
UNIFI MANUFACTURING, INC. |
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By: |
/s/ Edmund M. Ingle |
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Name: |
Edmund M. Ingle |
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Title: |
Chief Executive Officer |
BUYER: |
ENOVUM NC-1 BIDCO, LLC |
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By: Enovum NC-1 Midco, LLC, its sole member |
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By: Enovum NC-1 Topco, Inc., its sole member |
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By: |
/s/ Billy Krassakopoulos |
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Billy Krassakopoulos, President |
The undersigned Original Buyer consents to the terms of this Amendment and agrees that it is bound by all of the obligations of Buyer under the Agreement as amended by this Amendment.
ORIGINAL BUYER: |
ENOVUM DATA CENTERS CORP. |
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By: |
/s/ Billy Krassakopoulos |
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Billy Krassakopoulos, Chief Executive Officer |
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EXHIBIT A
[*****]
Exhibit 99.1
UNIFI®, Makers of REPREVE®, Announces the Sale of Manufacturing Facility
Proceeds allocated to reduce debt, strengthen balance sheet, and enhance future financial performance
GREENSBORO, N.C., May 21, 2025 – Unifi, Inc. (NYSE: UFI) (together with its consolidated subsidiaries, “UNIFI”), the makers of REPREVE® and one of the world’s leading innovators in recycled and synthetic yarns, today announced the closing of the sale of its manufacturing facility in Madison, North Carolina to a third-party buyer.
Transaction Highlights:
• |
Transaction valued at $45.0 million, with $25.0 million of net proceeds used to reduce the existing term loan and $18.3 million of net proceeds used to reduce outstanding revolving loans. Accordingly, on May 20, 2025, the term loan balance was reduced to $67.0 million and the revolving loan balance was reduced to $5.6 million, thereby reducing debt principal by approximately $43.3 million. |
• |
With the facility closing driving higher expected utilization and more efficient operations in the Americas segment, UNIFI expects to realize over $20.0 million in estimated annualized operating cost savings once all transition and restructuring activities are completed. |
“The sale of our Madison facility, and related exit of yarn manufacturing at that site, marks a significant step in transitioning our Americas business to improved profitability. As a result of this transaction, we paid down a meaningful portion of our existing debt and enhanced our overall financial position,” said Eddie Ingle, Chief Executive Officer of UNIFI, Inc. “Beyond the improvement to the balance sheet, the relocation of the production capacity from the Madison facility to other locations in North and Central America will dramatically optimize our business and make UNIFI a leaner organization.”
About UNIFI
UNIFI, Inc. (NYSE: UFI) is a global leader in fiber science and sustainable synthetic textiles. Using proprietary recycling technology, UNIFI is a pioneer in scaling the transformation of post-industrial and post-consumer waste into sustainable products. Through REPREVE®, the world’s leading brand of traceable, recycled fiber and resin, UNIFI is changing the way industries think about the materials they use – and reuse. A vertically-integrated manufacturer, the company has direct operations in the United States, Colombia, El Salvador, and Brazil and sales offices all over the world. UNIFI envisions a future where circular and sustainable solutions are the only choice. For more information about UNIFI, visit www.UNIFI.com.
Contact information:
Josh Carroll or Blaine McNulty
Alpha IR Group
312-445-2870
UFI@alpha-ir.com