a0190320loweemploymentag






                                                          EXECUTION VERSION                                Employment Agreement          This Employment Agreement (this “Agreement”), is entered into on March 20th, 2019,   and effective as of January 1, 2019 (the “Effective Date”), by and between KEMET Corporation,   a Delaware corporation (the “Company”), and William M. Lowe, Jr. (“Executive”) (collectively   referred to herein as the “Parties”).                                     RECITALS   A.    It is the desire of the Company to assure itself of the continued services of Executive by        entering into this Agreement.   B.    Executive and the Company mutually desire that Executive continue to provide services        to the Company on the terms herein provided.                                      AGREEMENT         NOW, THEREFORE, in consideration of the foregoing and of the respective covenants  and agreements set forth below, the Parties hereto agree as follows:   1.    Employment.             (a) General.  The Company shall continue to employ Executive and Executive shall      remain in the employ of the Company, for the period and in the position set forth in this      Section 1, and subject to the other terms and conditions herein provided.               (b) Employment Term.  For purposes of this Agreement, the “Term” shall mean the      period beginning on the Effective Date and ending on March 31, 2021, subject to earlier     termination as provided in Section 3.  The Term may be extended by mutual agreement of      the Parties.  No later than sixty (60) days prior to the expiration of the initial Term, the      Parties shall engage in good faith negotiations with respect to extending the initial Term, and      any extension shall constitute part of the Term for purposes of this Agreement.              (c) Position and Duties.  Executive shall serve as the Chief Executive Officer of the      Company.  Executive shall have such powers, responsibilities, duties and authority as are     customary for such position and as otherwise assigned by the Board of Directors of the     Company (the “Board”).  Executive shall devote substantially all of Executive’s working      time and efforts to the business and affairs of the Company (which shall include service to its      “Affiliates” (within the meaning of Rule 12b-2 promulgated under Section 12 of the      Securities Exchange Act of 1934, as amended from time to time)) and shall not engage in      outside business activities (including serving on outside boards or committees) without the      consent of the Board, provided that Executive shall be permitted to (i) manage Executive’s      personal, financial and legal affairs; (ii) participate in trade associations; (iii) serve on the      board of directors of not-for-profit or tax-exempt charitable organizations; and (iv) subject to     approval by the Board, serve on the board of directors or similar board of for-profit     organizations, in each case, subject to compliance with this Agreement and provided that     such activities do not materially interfere with Executive’s performance of Executive’s duties  





 






   and responsibilities hereunder.  Executive agrees to observe and comply with the rules and     policies of the Company and its subsidiaries as adopted by the Company or its Affiliates     from time to time, in each case as amended from time to time, as set forth in writing, and as     delivered or made available to Executive (each, a “Policy”).            (d) Service on Board.  The Company shall use its reasonable best efforts to cause     Executive to be re-elected to the Board during the Term.            (e) Principal Place of Employment.  Executive’s principal office shall be the     Company’s headquarters in Fort Lauderdale, Florida.  Executive may perform his duties     under this Agreement at such other offices as may be appropriate for the performance of his     duties as determined in consultation with the Board.  The Parties understand that given the     nature of Executive’s duties, Executive will be required to travel and perform services at    locations other than his principal office from time to time.           (f) Certain Executive Representations.  Executive represents and warrants that (i)     Executive is not subject to any impediment, restriction or restraint that would in any way     prohibit, hinder or impair his employment hereunder and his performance as contemplated     hereby; (ii) without limiting the foregoing, Executive’s employment hereunder and his     performance as contemplated hereby do not and would not in any way conflict with or breach     any confidentiality, non-competition or other agreement to which he is a party or to which he     may be subject; and (iii) Executive has not been the subject of any allegation and, to his     knowledge, he has not, (A) breached any law, regulation or code of conduct applicable to     him in the course of employment; or (B) engaged in any act of workplace misconduct or     impropriety, including any act of discrimination or harassment.   2.    Compensation and Related Matters.            (a) Annual Base Salary.  During the Term, Executive shall receive a base salary at a     minimum rate of $725,000 per annum, which shall be paid in accordance with the customary     payroll practices of the Company and shall be pro-rated for partial years of employment.      Such annual base salary shall be subject to periodic review in accordance with the     Company’s regular process for similarly situated executives (with the first review for     Executive accordingly expected not later than early 2020) and shall be subject to increase but     not decrease (such annual base salary, as it may be increased from time to time, the “Annual     Base Salary”).             (b) Annual Bonus.  With respect to each fiscal year of the Company commencing     during the Term, Executive will be eligible to participate in the Company’s Annual Incentive     Program or such successor plan as may be in effect from time to time (the “KAIP”).      Executive’s annual incentive compensation under the KAIP (the “Annual Bonus”) shall be     targeted at 100% of his Annual Base Salary (the “Target Bonus”), with the expectation that     the actual Annual Bonus will scale upward and downward based on actual performance, as     determined by the Board, such that the actual Annual Bonus payable to Executive may be     greater than, equal to or less than the Target Bonus.  The Annual Bonus shall be based upon     the achievement of Company and/or individual performance metrics as established by the                                         2    





 






 Board.  The Annual Bonus for a fiscal year will be paid no later than the fifteenth day of the   third month following the end of such fiscal year.            (c) Prior Equity Grants.  Upon the execution of this Agreement, the restricted stock   units granted to Executive pursuant to the award agreements, dated May 18, 2016, May 18,   2017 and May 18, 2018 (collectively, the “Award Agreements”) shall be deemed vested on a   pro-rata basis, based on the number of days Executive was actively employed during the   vesting period starting with the date of grant of the award and ending with the date of  execution of this Agreement as determined in accordance with the Company’s equity award  retirement policy.         (d) Initial Equity Grant.  Effective as of January 1, 2019, the Company granted   Executive 50,000 restricted stock units, with 25,000 restricted stock units vesting fifteen (15)   months after the grant date and 25,000 restricted stock units vesting twenty-seven (27)   months after the grant date, subject to Executive’s continued service on each vesting date and   otherwise subject to the terms of the Company’s Omnibus Incentive Plan or such successor   plan as may be in effect from time to time (the “LTIP”) and the applicable award agreement.          (e) Long-Term Incentive.  The Company will grant Executive equity incentive   awards (or other long-term incentive compensation) for each fiscal year of the Company   during the Term, commencing April 1, 2018, with a minimum target value of $1,000,000 for   all such awards, in accordance with the LTIP and the applicable award agreement.  The type   of award and specific terms and conditions of such awards will be determined by the Board   commensurate with Executive’s position.          (f) Employee Benefits.  During the Term, Executive shall be eligible to participate in   employee benefit plans, programs and arrangements generally available from time to time to   other similarly situated executives of the Company employed at the Company’s headquarters,   with Executive on no less favorable terms, including medical, dental and life benefits as they   may be in effect from time to time.          (g) Paid Time Off.  During the Term, Executive shall be entitled to at least five (5)   weeks, on an annualized basis, of paid personal leave in accordance with the Company’s  Policies.  Any vacation shall be taken at the reasonable and mutual convenience of the  Company and Executive.         (h) Business Expenses.  During the Term, the Company shall reimburse Executive for   all reasonable travel and other business expenses incurred by Executive in the performance   of Executive’s duties to the Company in accordance with the Company’s expense   reimbursement Policy.          (i) Indemnification.  At such time during the Term as the Company shall enter into   an individual indemnification agreement with any of its directors or officers, the Company   shall enter into an individual indemnification agreement with Executive on no less favorable   terms.                                        3                 





 






          (j) Payment of Fees Associated with  Review.  The Company shall reimburse      Executive up to $5,000 for the reasonable attorneys’ fees and costs associated with the     review and negotiation of this Agreement.   3.    Termination.             (a) In General.  Executive’s employment hereunder may be terminated by the      Company or Executive, as applicable, without any breach of this Agreement under the      following circumstances:                (i)   Death.  Executive’s employment hereunder shall terminate upon         Executive’s death.                  (ii)  Disability.  If Executive has incurred a Disability, as defined below, the         Company may terminate Executive’s employment.                  (iii) Termination for Cause.  The Company may terminate Executive’s         employment for Cause.                (iv)  Termination without Cause.  The Company may terminate Executive’s         employment without Cause.                (v)   Termination by Executive without Good Reason.  Executive may terminate         Executive’s employment with the Company without Good Reason.                (vi)  Termination by Executive for Good Reason.  Executive may terminate         Executive’s employment with the Company for Good Reason.                (vii) Termination by Executive due to Retirement.  Executive may terminate         Executive’s employment with the Company due to Retirement.             (b) Notice of Termination.  Any termination of Executive’s employment by the      Company or by Executive under this Section 3 (other than termination pursuant to Section      3(a)(i)) shall be communicated by a written notice to the other Party hereto (i) indicating the      specific termination provision in this Agreement relied upon; (ii) setting forth in reasonable      detail the facts and circumstances claimed to provide a basis for termination of Executive’s      employment under the provision so indicated; and (iii) specifying a Date of Termination (as      defined below) which, if submitted by Executive pursuant to Section 3(a)(v) or Section      3(a)(vi), shall be at least thirty (30) days following the date of such notice (a “Notice of      Termination”); provided, however, that in the event that Executive delivers a Notice of      Termination to the Company, the Company may, in its sole discretion, change the Date of     Termination to any date that occurs on or following the date of the Company’s receipt of     such Notice of Termination and is prior to the date specified in such Notice of Termination.      In such event, however, the Executive shall be entitled to all compensation and benefits (or     their equivalent value) pursuant to this Agreement and any other applicable incentive or     benefit plan or policy then in effect, up to and including the final day of such Notice period     (i.e., “pay in lieu of notice”).  A Notice of Termination submitted by the Company may     provide for a Date of Termination on the date Executive receives the Notice of Termination,                                          4     





 






   or any date thereafter elected by the Company in its sole discretion.  In the event of a dispute     over the existence of Cause or Good Reason, either Party may introduce newly discovered or     newly arising evidence in support of or in opposition to the determination of Cause or Good     Reason.            (c) Company Obligations upon Termination.  Upon termination of Executive’s     employment pursuant to any of the circumstances listed in Section 3(a), Executive (or     Executive’s estate) shall be entitled to receive the sum of: (i) the portion of Executive’s     Annual Base Salary earned through the Date of Termination but not yet paid to Executive;     (ii) any paid time off that has been accrued but unused in accordance with the Company’s     Policies; (iii) any reimbursements owed to Executive pursuant to Section 2(h); (iv) any     amount accrued and arising from Executive’s participation in, or benefits accrued under any     employee benefit plans, programs or arrangements, which amounts shall be payable in     accordance with the terms and conditions of such employee benefit plans, programs or     arrangements; and (v) except in the case of a termination of Executive’s employment for     Cause pursuant to Section 3(a)(iii), any earned but unpaid Annual Bonus for the prior fiscal     year.  Except as otherwise expressly required by law (e.g., COBRA (as defined below)) or as    specifically provided herein, or in any other plan or arrangement maintained by the    Company, all of Executive’s rights to salary, severance, benefits, bonuses and other    compensatory amounts hereunder (if any) shall cease upon the termination of Executive’s    employment hereunder.  In the event that Executive’s employment is terminated hereunder    for any reason, Executive’s sole and exclusive remedy shall be to receive the payments and    benefits described in this Section 3(c) or Section 4 or in any other plan or arrangement     maintained by the Company, as applicable.            (d) Deemed Resignation.  Upon termination of Executive’s employment for any     reason, Executive shall be deemed to have resigned from all offices and directorships, if any,     then held with the Company or any of its Affiliates and Executive agrees to execute any and     all documents necessary to effectuate such resignations.   4.    Severance Payments.            (a) Termination Generally.  If Executive’s employment shall terminate pursuant to     Section 3(a) for any reason other than pursuant to Section 3(a)(i) (death), Section 3(a)(ii)     (Disability), Section 3(a)(iv) (by the Company without Cause) or Section 3(a)(vi) (by     Executive for Good Reason), then Executive shall not be entitled to any severance payments     or benefits, except as provided in Section 3(c).            (b) Equity Treatment.  If Executive’s employment shall terminate pursuant to Section     3(a) for any reason other than pursuant to Section 3(a)(iii), then any equity incentive     compensation award which is held by Executive as of the Date of Termination (other than the     award described in Section 2(d)) shall vest on a pro-rata basis, based on the number of days     Executive was actively employed during either the vesting period or performance period, as     applicable, (i) in the case of any award with solely a service-vesting component starting with     the date of grant of the award and ending with the Date of Termination (but offset by the     number of shares previously vested in respect of such award) and (ii) in the case of any     award with a performance-vesting component starting with the commencement date of the                                         5    





 






applicable performance period and ending with the earlier of the Date of Termination or the  last day of the performance period. Any award with solely a service-vesting component shall  be delivered as though the Date of Termination were the last day of the service-vesting  period and any award with a performance-vesting component shall remain subject to actual  performance attainment during the full performance period with the payment of any such  performance award otherwise made at such time and under such other circumstances as  would have applied without regard to Executive’s employment termination. The foregoing  treatment shall only apply to an award with solely a service-vesting component if the award  was granted to Executive six (6) or more months prior to the Date of Termination. The  foregoing treatment shall only apply to an award with a performance-vesting component if  Executive was employed on September 1 of the first year during the applicable performance  period.          (c) Termination without Cause or for Good Reason.  Except as otherwise provided in  Section 4(d), if Executive’s employment is terminated by the Company without Cause  pursuant to Section 3(a)(iv) or by Executive for Good Reason pursuant to Section 3(a)(vi)  then, subject to Executive signing on or before the 50th day following Executive’s Separation  from Service (as defined below), and not revoking, a release of claims and separation  agreement in the Company’s customary form, as may be updated from time to time (the  “Release”), and Executive’s continued compliance with Sections 5 - 7, Executive shall  receive, in addition to payments and benefits set forth in Section 3(c), the following benefits:            (i)   The Company shall pay to Executive an amount equal to the lesser of (x)     one (1) times the sum of (A) the Annual Base Salary plus (B) the Target Bonus, each in     the full amount as in effect at such time, payable over twelve (12) months; or (y) the sum     of (A) the Annual Base Salary plus (B) the Target Bonus, each as in effect at such time     and prorated for the number of remaining days of employment in the initial Term or any     extended Term (measured from the commencement of such extended Term), as     applicable, payable over the remainder of such Term; in each case in equal installments     in accordance with the Company’s regular payroll practice; provided that the first such     payment shall be made within sixty (60) days following the Date of Termination on the     first regularly scheduled payroll date of the Company following the date the Release     becomes nonrevocable and shall include all payments that would have otherwise been     made to Executive had the payments commenced on the Date of Termination;            (ii)  The Company shall pay to Executive a cash lump sum an amount equal to    the premiums Executive would have been required to pay to continue Executive’s and    Executive’s covered dependents’ medical, dental and vision coverage in effect on the    Date of Termination under the Company’s group healthcare plans pursuant to the    Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), for     the number of months following the Date of Termination over which the payments set     forth in Section 4(c)(i) are made, which amount shall be based on the premium for the     first month of COBRA coverage and shall be paid, regardless of whether or not     Executive elects COBRA continuation coverage, within sixty (60) days following the     Date of Termination on the first regularly scheduled payroll date of the Company     following the date the Release becomes nonrevocable; and                                      6                 





 






            (iii) Notwithstanding anything in Section 4(c) to the contrary, in the event any        payments thereunder could occur in one of two calendar years as a result of being        dependent upon the Release becoming nonrevocable, then, to the extent required to avoid        penalties under Section 409A (as defined below), such payments shall commence on the        first regularly scheduled payroll date of the Company, following the date the Release        becomes nonrevocable, that occurs in the second of such two calendar years.               (iv)  For purposes of this Agreement, a termination of Executive’s employment        following a notice of nonrenewal of this Agreement by the Company shall be treated as a        Retirement.            (d) Termination in Connection With a Change in Control.  Notwithstanding     Executive’s prior notice, subsequently rescinded, of his intention to retire, the Parties hereby     agree that the terms and conditions of the Change in Control Severance Compensation     Agreement between the Company and Executive dated as of July 28, 2017 (the “CIC     Agreement”) shall remain in effect during the Term, except that, notwithstanding anything to     the contrary in the CIC Agreement, solely to the extent required to avoid the imposition of     taxes or penalties under Section 409A any payments and benefits payable under the CIC     Agreement will be made on the same schedule as the payments and benefits otherwise set     forth in this Section 4.  The payments and benefits set forth in this Section 4(d), to the extent     paid or provided, shall be in lieu of any payments or benefits set forth in Section 4(c).            (e) Death or Disability.  If Executive’s employment is terminated by reason of death     pursuant to Section 3(a)(i) or Disability pursuant to Section 3(a)(ii) then, subject to Executive     (or his estate, as the case may be) signing on or before the 50th day following Executive’s     Separation from Service, and not revoking, the Release, and, in the case of Disability,     Executive’s continued compliance with Sections 5 - 7, the Company shall pay or provide to     Executive (or his estate, as the case may be), in addition to payments and benefits set forth in     Section 3(c), an amount equal to the Annual Bonus, as in effect at such time, determined     based on the actual performance of the Company for the full fiscal year in which Executive’s     employment terminates, prorated for the number of days of employment completed during     the fiscal year in which the Date of Termination occurs, payable in a lump sum cash amount     at the time it would otherwise have been paid in accordance with Section 2(b) had Executive     remained employed for the entire fiscal year.            (f) No Mitigation; Payment to Surviving Spouse.  Notwithstanding anything to the     contrary in this Agreement, Executive shall not be required to seek other employment or     otherwise mitigate any damages resulting from any termination of employment.  In the event     of Executive’s death prior to payment of all compensation and benefits due to Executive     under Section 3(c), any remaining compensation and benefits shall be paid to his spouse, if     any, or if none as required by laws of succession or intestacy.   5.    Confidential Information.             (a) Obligation to Maintain Confidentiality.  Executive understands and acknowledges     that during the course of his employment with the Company and its Subsidiaries (as defined     below), Executive will have access to and learn about Confidential Information.                                          7    





 






 “Confidential Information” means all information of any sort (whether merely remembered   or embodied in a tangible or intangible form) relating or belonging to the Company or its   Subsidiaries that is not generally known or publicly available.  Confidential Information   includes, without specific limitation, the information, observations and data obtained by   Executive during the course of his performance under this Agreement concerning the   business and affairs of the Company and its Subsidiaries, information concerning acquisition   opportunities in or reasonably related to the Company’s or its Subsidiaries’ business or   industry of which Executive becomes aware during the Term, the persons or entities that are   current, former or prospective suppliers or customers of any one or more of them during   Executive’s course of performance under this Agreement, as well as development, transition   and transformation plans, methodologies and methods of doing business, strategic, marketing   and expansion plans, including plans regarding planned and potential sales, financial and   business plans, employee lists and telephone numbers, locations of sales representatives, new   and existing programs and services, prices and terms, customer service, integration   processes, requirements and costs of providing service, support and equipment.  Therefore,   Executive agrees that he shall not, at any time, disclose to any person or entity or use for his   own account any of such Confidential Information without the Board’s prior written consent,   unless and to the extent that any Confidential Information (x) becomes generally known to   and available for use by the public other than as a result of Executive’s acts or omissions to   act; or (y) is required to be disclosed pursuant to any applicable law or court order (provided  that Executive provides the Company with prior notice of the contemplated disclosure and   cooperates with the Company at its expense in seeking a protective order or other appropriate   protection of such information).  Executive agrees to deliver to the Company upon   termination of his employment or at the end of the Term, or at any other time the Company   may request in writing, all memoranda, notes, plans, records, reports and other documents   and electronic records (and copies thereof) relating to the business of the Company or its   Subsidiaries (including, without limitation, all Confidential Information) that he may then   possess or have under his control.  Subject to Section 5(d), (f) and (g), Executive may not   disclose or use for his own account any Confidential Information at any time following the   Executive’s employment with the Company or its Subsidiaries.  For purposes of this   Agreement, “Subsidiaries” shall mean any corporation or other entity of which the securities   or other ownership interests having the voting power to elect a majority of the board of   directors or other governing body are directly or indirectly owned by the Company.          (b) Ownership of Intellectual Property.  Executive agrees to make prompt and full   disclosure to the Company or its Subsidiaries, as the case may be, all ideas, discoveries, trade   secrets, inventions, innovations, improvements, developments, methods of doing business,   processes, programs, designs, analyses, drawings, reports, data, software, firmware, logos   and all similar or related information (whether or not patentable and whether or not reduced  to practice) that relate to the Company’s or its Subsidiaries’ actual or anticipated business,  research and development, or existing or future products or services and that are conceived,  developed, acquired, contributed to, made, or reduced to practice by Executive (either solely  or jointly with others) while employed by the Company or its Subsidiaries and for a period of  one (1) year thereafter (collectively, “Work Product”).  Any copyrightable work falling   within the definition of Work Product shall be deemed a “work made for hire” under the   copyright laws of the United States, and ownership of all rights therein shall vest in the   Company or its Subsidiaries.  To the extent that any Work Product is not deemed to be a                                      8                 





 






“work made for hire,” Executive hereby assigns and agrees to assign to the Company or such  Subsidiaries all right, title and interest, including without limitation, the intellectual property  rights that Executive may have in and to such Work Product.  Executive shall promptly  perform all actions reasonably requested by the Board (whether during or after the Term) to  establish and confirm the Company’s or such Subsidiaries’ ownership (including, without  limitation, providing testimony and executing assignments, consents, powers of attorney, and  other instruments).         (c) Third Party Information.  Executive understands that the Company and its  Subsidiaries will receive from third parties confidential or proprietary information (“Third  Party Information”) subject to a duty on the Company’s and its Subsidiaries’ part to maintain  the confidentiality of such information and to use it only for certain limited purposes.  During  the Term and thereafter, and without in any way limiting the provisions of Section 5(a),  Executive will hold Third Party Information in the strictest confidence and will not disclose  to anyone (other than personnel of the Company or its Subsidiaries who need to know such  information in connection with their work for the Company or such Subsidiaries) or use,  except in connection with his work for the Company or its Subsidiaries, Third Party  Information unless expressly authorized by a member of the Board in writing.         (d) Executive may respond to a lawful and valid subpoena or other legal process but  shall give the Company the earliest possible notice thereof, and shall, as much in advance of  the return date as possible, make available to the Company and its counsel the documents and  other information sought and shall assist such counsel at Company’s expense in resisting or  otherwise responding to such process, in each case to the extent permitted by applicable laws  or rules.         (e) As used in Sections 5 – 7, the term “Company” shall include the Company and its  direct and indirect parents and Subsidiaries.           (f) Nothing in this Agreement shall prohibit Executive from (i) disclosing  information and documents when required by law, subpoena or court order (subject to the  requirements of Section 5(d)); (ii) disclosing information and documents to Executive’s  attorney, financial or tax adviser for the purpose of securing legal, financial or tax advice;  (iii) disclosing Executive’s post-employment restrictions in this Agreement in confidence to  any potential new employer of Executive; or (iv) retaining, at any time, Executive’s personal  correspondence, Executive’s personal contacts and documents related to Executive’s own  personal benefits, entitlements and obligations, except where such correspondence, contracts  and documents contain Confidential Information.         (g) Pursuant to 18 U.S.C. § 1833(b), Executive understands that 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 Executive’s 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.  Executive understands that if Executive files a lawsuit for retaliation by the  Company for reporting a suspected violation of law, Executive may disclose the trade secret                                      9                 





 






    to Executive’s attorney and use the trade secret information in the court proceeding if      Executive (x) files any document containing the trade secret under seal; and (y) does not      disclose the trade secret, except pursuant to court order.  Nothing in this Agreement, or any      other agreement that Executive has with the Company, 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.  Further, nothing in this Agreement or any other agreement that Executive has with      the Company shall prohibit or restrict Executive from making any voluntary disclosure of     information or documents concerning possible violations of law to any governmental agency     or legislative body, or any self-regulatory organization, in each case, without advance notice     to the Company.   6.    Non-Compete, Non-Solicitation.             (a) Executive acknowledges that during the course of his employment with the      Company and its Subsidiaries, (i) he has become familiar with the Company’s trade secrets      and with other Confidential Information concerning the Company and its predecessors and its      Subsidiaries; (ii) the Company and its Subsidiaries has invested and continues to invest      substantial resources in developing and preserving its business relationships and goodwill,      and the loss any such relationships or goodwill will cause significant and irreparable harm to      the Company and its Subsidiaries; and (iii) his services are of special, unique and      extraordinary value to the Company and its Subsidiaries.              (b) Executive agrees that during the Term and ending on the end of the Restricted      Period, as defined below, he shall not directly or indirectly own any interest in, manage,      control, participate in, consult with, render services for, be employed by, or in any manner      associate with or engage in the business of designing, manufacturing, producing, distributing      or selling passive electronic components, within any country in which the Company or its      Subsidiaries engage or plan to engage in such business.  Nothing herein shall prohibit      Executive from being a passive owner of not more than 5% of the outstanding stock of any      class of a corporation which is publicly traded, so long as Executive has no active      participation in the business of such corporation.  For purposes of this Agreement, the term      “Restricted Period” shall mean two (2) years following the termination of employment      hereunder.             (c) During the Restricted Period, Executive shall not directly or indirectly through      another person or entity (i) induce or attempt to induce any employee of the Company or any      Subsidiary to leave the employ of the Company or such Subsidiary, or in any way interfere      with the relationship between the Company or any Subsidiary and any employee thereof; (ii)     hire any person who was an employee of the Company or any Subsidiary at any time during     the Term; or (iii) induce or attempt to induce any customer, supplier, licensee, licensor,     franchisee or other business relation of the Company or any Subsidiary to cease doing     business with the Company or such Subsidiary, or in any way interfere with the relationship     between any such customer, supplier, licensee or business relation and the Company or any     Subsidiary (including, without limitation, making any negative or disparaging statements or     communications regarding the Company or its Subsidiaries).                                           10     





 






          (d) If, at the time of enforcement of this Section 6, a court shall hold that the duration,      scope or area restrictions stated herein are unreasonable under circumstances then existing,      the Parties agree that the maximum duration, scope or area reasonable under such     circumstances shall be substituted for the stated duration, scope or area and that the court     shall be allowed to revise the restrictions contained herein to cover the maximum period,     scope and area permitted by law.  Executive acknowledges that the restrictions contained in     this Section 6 are reasonable and that he has reviewed the provisions of this Agreement with      his legal counsel.    7.    Executive’s Cooperation.            During the Term and thereafter, Executive shall assist and cooperate with the Company   and its Subsidiaries in connection with any investigation, administrative, regulatory or judicial   proceeding, or in connection with any dispute or claim of any kind that may be made against, by,   or with respect to the Company, as reasonably requested by the Company (including, without  limitation, Executive being available to the Company upon reasonable notice for interviews and  factual investigations, appearing at the Company’s request to give testimony without requiring  service of a subpoena or other legal process, volunteering to the Company all pertinent  information and turning over to the Company all relevant documents which are or may come into  Executive’s possession). In the event the Company requires Executive’s cooperation in  accordance with this section at any point in time after the Term and at which Executive is no  longer a member of the Board, then in addition to reimbursement of  Executive for his  reasonable travel expenses (including lodging and meals, upon submission of receipts) in  accordance with the Company’s expense reimbursement policy as in effect from time to time, the  Company shall compensate Executive at an hourly rate commensurate with similarly situated  executives or consultants of the Company of like experience and expertise, and, in any event, at a  rate not less than $300 per hour; provided, however, that the Company shall not be required to  compensate Executive for assistance and cooperation in connection with (i) any phone call in  which the Executive participates for 1 hour or less, (ii) testimony provided by Executive as a  witness in connection with any action, claim or proceeding and (iii) any investigation related to  or arising out of allegations of Executive’s misconduct.   8.    Injunctive Relief.          It is recognized and acknowledged by Executive that a breach of the covenants contained   in Sections 5 - 7 will cause irreparable damage to Company and its goodwill, the exact amount of   which will be difficult or impossible to ascertain, and that the remedies at law for any such   breach will be inadequate.  Accordingly, Executive agrees that in the event of a breach of any of  the covenants contained in Sections 5 - 7, in addition to any other remedy which may be   available at law or in equity, the Company will be entitled to seek specific performance and   injunctive relief without the requirement to post bond.    9.    Maximum Payment Limit.          If any payment or benefit due under this Agreement, together with all other payments and   benefits that Executive receives or is entitled to receive from the Company or any of its   subsidiaries, Affiliates or related entities, would (if paid or provided) constitute an excess                                          11     





 






 parachute payment for purposes of Section 280G of the Internal Revenue Code of 1986, as   amended (the “Code”), the amounts otherwise payable and benefits otherwise due under this   Agreement will either (i) be delivered in full; or (ii) be limited to the minimum extent necessary   to ensure that no portion thereof will fail to be tax-deductible to the Company by reason of   Section 280G of the Code, whichever of the foregoing amounts, taking into account the   applicable federal, state or local income and employment taxes and the excise tax imposed under   Section 4999 of the Code, results in the receipt by the Executive, on an after-tax basis, of the   greatest amount of benefits, notwithstanding that all or some portion of such benefits may be   subject to the excise tax imposed under Section 4999 of the Code.  In the event that the payments   and/or benefits are to be reduced pursuant to this Section 9, such payments and benefits shall be   reduced such that the reduction of cash compensation to be provided to the Executive as a result   of this Section 9 is minimized.  In applying this principle, the reduction shall be made in a   manner consistent with the requirements of Section 409A and where two economically   equivalent amounts are subject to reduction but payable at different times, such amounts shall be   reduced on a pro rata basis but not below zero.  All determinations required to be made under   this Section 9 shall be made by the Company’s independent public accounting firm, or by   another advisor mutually agreed to by the Parties, which shall provide detailed supporting   calculations both to the Company and Executive within fifteen (15) business days of the receipt   of notice from Executive that there has been a payment or benefit subject to this Section 9, or   such earlier time as is requested by the Company.   10.   Clawback Provisions.          Notwithstanding any other provisions in this Agreement to the contrary, any incentive-  based compensation, or any other compensation, paid to Executive pursuant to this Agreement or   any other agreement or arrangement with the Company which is subject to recovery under any   Policy approved by the Board that is generally applicable to senior management of the Company,  applicable law, government regulation or stock exchange listing requirement, will be subject to  such deductions and clawback as may be required to be made pursuant to such Policy, law,  government regulation or stock exchange listing requirement.   11.   Assignment and Successors.          The Company may assign its rights and obligations under this Agreement to a United   States subsidiary of the Company that is the main operating company of the Company (or the   principal employer of employees of the Company and its subsidiaries) in the United States or to   any successor to all or substantially all of the business or the assets of the Company (by merger   or otherwise), and may assign or encumber this Agreement and its rights hereunder as security   for indebtedness of the Company and its Affiliates.  This Agreement shall be binding upon and   inure to the benefit of the Company, Executive and their respective successors, assigns,   personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and  legatees, as applicable.  None of Executive’s rights or obligations may be assigned or transferred   by Executive, other than Executive’s rights to payments hereunder, which may be transferred   only by will or operation of law.  Notwithstanding the foregoing, Executive shall be entitled, to   the extent permitted under applicable law and any applicable Company benefit plans or   arrangements, to select and change a beneficiary or beneficiaries to receive compensation   hereunder following Executive’s death by giving written notice thereof to the Company.                                            12     





 






12.   Certain Definitions.            (a) Cause.  The Company shall have “Cause” to terminate Executive’s employment     hereunder upon:               (i)   a majority of the members of the Board, excluding Executive as        applicable, determining that (A) Executive has committed an act of fraud in the course of        his employment against the Company; (B) Executive has committed an act of misconduct        or gross negligence against the Company that is materially injurious to the Company or        its customers; or (C) Executive has materially breached a Company Policy;               (ii)  a majority of the members of the Company’s Board of Directors,        excluding Executive as applicable, determining that Executive has failed to adequately        perform material duties or obligations under  this Agreement;               (iii) Executive’s indictment for, or conviction of, or pleading no contest to, a        felony; or               (iv)  a material breach of any of the representations and warranties set forth in        Section 1(f).                 The determination as to whether the Executive is being terminated for Cause shall  be made after a reasonable and good faith investigation by the Board; provided, however, that  Cause shall not exist under this Agreement unless: (x) the Company gives written notice to  Executive of the event or condition within ninety (90) days following the Board’s actual  knowledge thereof where such notice describes with particularity the alleged act(s) at issue, (y)  the Company has given the Executive no fewer than thirty (30) days to remedy or otherwise cure  the event or condition and an opportunity to be heard at a meeting of the Board at his sole  discretion with or without counsel and the Board provides Executive a summary of its findings;  and (z) the Company terminates Executive’s employment within thirty (30) days following the  expiration of the cure period.            (b) Date of Termination.  “Date of Termination” shall mean (i) if Executive’s     employment is terminated by Executive’s death, the date of Executive’s death; and (ii) if     Executive’s employment is terminated pursuant to Section 3(a)(ii) - 3(a)(vi), either the date     indicated in the Notice of Termination or the date specified by the Company pursuant to     Section 3(b), whichever is earlier.            (c) Disability.  “Disability” shall mean, at any time the Company or any of its     Affiliates sponsors a long-term disability plan for the Company’s employees,  “disability” as     defined in such long-term disability plan for the purpose of determining a participant’s     eligibility for benefits, provided, however, if the long-term disability plan contains multiple     definitions of disability, “Disability” shall refer to that definition of disability which, if     Executive qualified for such disability benefits, would provide coverage for the longest     period of time. The determination of whether Executive has a Disability shall be made by the     person or persons required to make disability determinations under the long-term disability     plan.  At any time the Company does not sponsor a long-term disability plan for its     employees, Disability shall mean Executive’s inability to perform, with or without                                        13    





 






 reasonable accommodation, the essential functions of Executive’s position hereunder for a  total of three months during any twelve-month period as a result of incapacity due to mental  or physical illness as determined by a qualified physician licensed to practice medicine in the  State of Pennsylvania as shall be mutually selected by the Company (or its insurers) and  Executive (or his representatives).  Provided that the Company shall have provided Executive  with a written summary of its basis for believing Disability may exist, any unreasonable  refusal by Executive to submit to a medical examination for the purpose of determining  Disability within a reasonable period following a written request by the Company (or its  insurers) shall be deemed to constitute conclusive evidence of Executive’s Disability.          (d) Good Reason.  “Good Reason” shall mean:             (i)   a reduction in Executive’s Annual Base Salary, other than any reduction      which is insignificant or is implemented as part of a formal austerity program approved      by the Board and applicable to all other senior executive officers of the Company,      provided such reduction does not reduce Executive’s Annual Base Salary by a percentage      greater than the average reduction in compensation of all other senior executive officers      of the Company;             (ii)  the Company reduces Executive’s Target Bonus, LTIP target value or      grant date value of annual equity awards;             (iii) a material, adverse change in Executive’s position with the Company that      reduces his title, responsibilities, level of authority or scope of duties (including as a      result of the assignment of responsibilities and/or duties from those in effect immediately      prior to the reduction or that are materially inconsistent with Executive’s position, or      Executive’s removal from, or the Company’s failure to nominate Executive for re-     election to, the Board during the Term);             (iv)  the Company breaches a material obligation to Executive under the terms      of this Agreement or any other material written agreement between Executive and the      Company; or             (v)   a relocation of Executive’s principal worksite of more than fifty (50) miles      unless such relocation reduces the Executive’s commute to such worksite.       However, none of the foregoing events or conditions will constitute Good Reason unless:      (x) Executive provides the Company with written objection to the event or condition      within ninety (90) days following the occurrence thereof; (y) the Company does not      reverse or otherwise cure the event or condition within thirty (30) days of receiving that      written objection; and (z) Executive terminates his employment within thirty (30) days      following the expiration of that cure period.          (e) Retirement.  “Retirement” shall mean the Executive’s voluntary retirement from   employment occurring at any time following the expiration of the initial Term of this   Agreement, or sooner in the event of mutual agreement between the Company and the   Executive, provided Executive shall provide written notice the Board of his intent to retire no   fewer than ninety (90) days in advance of his planned retirement date, and shall use his                                      14                 





 






   reasonable best efforts to assist the Company in any resulting transition, including extending     or delaying his Retirement date, and providing continued cooperation to the Company     thereafter pursuant to the terms of this Agreement.   13.   Miscellaneous Provisions.            (a) Governing Law.  This Agreement shall be governed, construed, interpreted and     enforced in accordance with its express terms, and otherwise in accordance with the     substantive laws of the State of Florida without reference to the principles of conflicts of law     of the State of Florida or any other jurisdiction, and where applicable, the laws of the United     States.  The Company and the Executive agree that any and all disputes relating to or arising     out of this Agreement, excluding any relief sought by the Company under Sections 5 - 8 or     any other dispute arising under this Agreement in respect of which a Party may seek     injunctive relief, but otherwise including disputes in respect of payments and benefits     provided hereunder, will first be submitted to mediation pursuant to a written demand for     mediation which either party may serve on the other which shall be before a mediator     selected by the Parties in accordance with mediation procedures of the American Arbitration     Association (“AAA”).  In the event, the Parties are unable to agree to a mediator within ten     (10) days of receipt of the written demand for mediation, the mediator will be appointed by     the office of AAA in Miami, Florida.  The cost of the mediator and fees imposed by AAA     shall be split equally by the Parties.             (b) Survival.  Notwithstanding anything to the contrary in this Agreement, the     provisions of Sections 4 through 11 and this 13 will survive the termination of Executive’s     employment and the expiration or termination of the Term.             (c) Notices.  Any notice, request, claim, demand, document and other communication     hereunder to any Party shall be effective upon receipt (or refusal of receipt) and shall be in     writing and delivered personally or sent by facsimile or certified or registered mail, postage     prepaid, as follows (except that notice of change of address shall be effective only upon    receipt):              (i)   If to the Company, to the attention of the General Counsel at its       headquarters,              (ii)  If to Executive, at the last address that the Company has in its personnel       records for Executive, or              (iii) At any other address as any Party shall have specified by notice in writing        to the other Party.            (d) Counterparts.  This Agreement may be executed in several counterparts, each of     which shall be deemed to be an original, but all of which together will constitute one and the     same Agreement.  Signatures delivered by facsimile shall be deemed effective for all     purposes.            (e) Entire Agreement.  The terms of this Agreement are intended by the Parties to be     the final expression of their agreement with respect to the subject matter hereof and                                         15    





 






 supersede all prior understandings and agreements, whether written or oral (including the   Incentive Award, Severance and Non-Competition Agreement by and between the Company   and Executive dated December 1, 2014).  The Parties further intend that this Agreement shall   constitute the complete and exclusive statement of their terms and that no extrinsic evidence   whatsoever may be introduced in any judicial, administrative, or other legal proceeding to  vary the terms of this Agreement.           (f) Amendments; Waivers.  This Agreement may not be modified, amended, or   terminated except by an instrument in writing, signed by Executive and a duly authorized   officer of Company (other than Executive).  By an instrument in writing similarly executed,   Executive or a duly authorized officer of the Company (other than Executive) may waive  compliance by the other Party with any specifically identified provision of this Agreement  that such other Party was or is obligated to comply with or perform; provided, however, that  such waiver shall not operate as a waiver of, or estoppel with respect to, any other or  subsequent failure.  No failure to exercise and no delay in exercising any right, remedy, or  power hereunder preclude any other or further exercise of any other right, remedy, or power  provided herein or by law or in equity.           (g) Construction.  This Agreement shall be deemed drafted equally by both the   Parties. Its language shall be construed as a whole and according to its fair meaning.  Any   presumption or principle that the language is to be construed against any Party shall not   apply.  The headings in this Agreement are only for convenience and are not intended to   affect construction or interpretation.  Any references to sections or subsections are to those   parts of this Agreement, unless the context clearly indicates to the contrary.  Also, unless the   context clearly indicates to the contrary, (i) the plural includes the singular and the singular   includes the plural; (ii) “and” and “or” are each used both conjunctively and disjunctively;   (iii) “any,” “all,” “each,” or “every” means “any and all,” and “each and every”; (iv)   “includes” and “including” are each “without limitation”; (v) “herein,” “hereof,” “hereunder”   and other similar compounds of the word “here” refer to the entire Agreement and not to any   particular section or subsection; and (vi) all pronouns and any variations thereof shall be   deemed to refer to the masculine, feminine, neuter, singular or plural as the identity of the   entities or persons referred to may require.          (h) Enforcement.  If any provision of this Agreement is held to be illegal, invalid or   unenforceable under present or future laws effective during the term of this Agreement, such   provision shall be fully severable; this Agreement shall be construed and enforced as if such   illegal, invalid or unenforceable provision had never comprised a portion of this Agreement;   and the remaining provisions of this Agreement shall remain in full force and effect and shall   not be affected by the illegal, invalid or unenforceable provision or by its severance from this   Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision there   shall be added automatically as part of this Agreement a provision as similar in terms to such   illegal, invalid or unenforceable provision as may be possible and be legal, valid and   enforceable.          (i) Withholding.  The Company shall be entitled to withhold from any amounts   payable under this Agreement any federal, state, local or foreign withholding or other taxes   or charges which the Company is required to withhold or by its Policies it customarily                                       16                 





 






withholds. The Company shall be entitled to rely on an opinion of counsel if any questions as  to the amount or requirement of withholding shall arise.         (j) Section 409A.            (i)   General.  The intent of the Parties is that the payments and benefits under     this Agreement comply with or be exempt from Section 409A of the Internal Revenue     Code of 1986, as amended, and the regulations and guidance promulgated thereunder     (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this     Agreement shall be interpreted to be in compliance therewith.              (ii)  Separation from Service.  Notwithstanding anything in this Agreement to     the contrary, any compensation or benefits payable under this Agreement that is     considered nonqualified deferred compensation under Section 409A and is designated    under this Agreement as payable upon Executive’s termination of employment shall be    payable only upon Executive’s “separation from service” with the Company within the    meaning of Section 409A (a “Separation from Service”) and, except as provided below,     any such compensation or benefits described in Section 4 shall not be paid, or, in the case     of installments, shall not commence payment, until the sixtieth (60th) day following     Executive’s Separation from Service (the “First Payment Date”).  Any lump sum     payment or installment payments that would have been made to Executive during the     sixty (60) day period immediately following Executive’s Separation from Service but for     the preceding sentence shall be paid to Executive on the First Payment Date and any     remaining installment payments shall be made as provided in this Agreement.            (iii) Specified Employee.  Notwithstanding anything in this Agreement to or     any other agreement providing compensatory payments to Executive to the contrary, if     Executive is deemed by the Company at the time of Executive’s Separation from Service     to be a “specified employee” for purposes of Section 409A, any payment of     compensation or benefits to which Executive is entitled under this Agreement or any     other compensatory plan or agreement that is considered nonqualified deferred     compensation under Section 409A payable as a result of Executive’s Separation from     Service shall be delayed to the extent required in order to avoid a prohibited distribution     under Section 409A until the earlier of (A) the expiration of the six-month period     measured from the date of Executive’s Separation from Service with the Company; or     (B) the date of Executive’s death.  Upon the first business day following the expiration of     the applicable Section 409A period, all payments deferred pursuant to the preceding     sentence shall be paid in a lump sum to Executive (or Executive’s estate or beneficiaries),     and any remaining payments due to Executive under this Agreement or any other     compensatory plan or agreement shall be paid as otherwise provided herein or therein.              (iv)  Expense Reimbursements.  To the extent that any reimbursements under     this Agreement are subject to Section 409A, any such reimbursements payable to     Executive shall be paid to Executive no later than December 31 of the year following the     year in which the expense was incurred; provided, that Executive submits Executive’s     reimbursement request promptly following the date the expense is incurred, the amount     of expenses reimbursed in one year shall not affect the amount eligible for reimbursement                                      17                 





 






      in any subsequent year, other than medical expenses referred to in Section 105(b) of the        Code, and Executive’s right to reimbursement under this Agreement will not be subject to        liquidation or exchange for another benefit.               (v)   Installments.  Executive’s right to receive any installment payments under        this Agreement, including any continuation salary payments that are payable on        Company payroll dates, shall be treated as a right to receive a series of separate payments        and, accordingly, each such installment payment shall at all times be considered a        separate and distinct payment as permitted under Section 409A.  Except as otherwise        permitted under Section 409A, no payment hereunder shall be accelerated or deferred        unless such acceleration or deferral would not result in additional tax or interest pursuant        to Section 409A.   14.   Executive Acknowledgement.         Executive acknowledges that Executive has read and understands this Agreement, is fully  aware of its legal effect, has not acted in reliance upon any representations or promises made by  the Company other than those contained in writing herein, and has entered into this Agreement  freely based on Executive’s own judgment.                                  [Signature Page Follows]                                          18    





 






                                                                                      IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date and  year first above written.                                             KEMET Corporation                                             By:        /s/ Frank Brandenberg                                            Name:  Frank Brandenberg                                            Title:  Chairman of the Board of Directors                                             EXECUTIVE                                             /s/ William M. Lowe, Jr.                                            William M. Lowe, Jr.                                                                                [Signature Page to Employment Agreement]    914658-NYCSR05A - MSW