Exhibit 10.7
PLEDGE AND SECURITY AGREEMENT
PLEDGE AND SECURITY AGREEMENT, dated as of September 15, 2008 (as amended,
supplemented or modified from time to time, this "Agreement"), made by KEMET
Electronics Corporation (the "Grantor") in favor of Vishay Intertechnology, Inc.
("Secured Party").
RECITALS
Pursuant to the Loan Agreement dated as of the date hereof (as amended,
supplemented or modified from time to time, the "Loan Agreement"; capitalized
terms used but not defined herein shall have the meanings given such terms in
the Loan Agreement) by and among Kemet Electronics Corporation, as Borrower, and
Secured Party, Secured Party has agreed to make a Loan to Borrower.
In order to
induce Secured Party to make the Loan, Grantor has agreed to grant a continuing
Lien on the Collateral to secure the Obligations (as hereinafter defined).
Accordingly, Grantor hereby agrees as follows:
1.
SECURITY INTEREST.
(A)
COLLATERAL.
FOR PURPOSES OF THIS AGREEMENT, ALL OF THE FOLLOWING
PROPERTY NOW OWNED OR AT ANY TIME HEREAFTER ACQUIRED BY GRANTOR OR IN WHICH
GRANTOR NOW HAS OR AT ANY TIME IN THE FUTURE MAY ACQUIRE ANY RIGHT, TITLE OR
INTEREST IS COLLECTIVELY REFERRED TO AS "COLLATERAL": (I)
US PLEDGED ACCOUNTS,
(II) ALL BOOKS AND RECORDS RELATING TO THE US PLEDGED ACCOUNTS, (II) ALL
SUPPORTING OBLIGATIONS (AS DEFINED IN THE UCC) RELATING TO THE US PLEDGED
ACCOUNTS, (III) THE COLLATERAL ACCOUNT AND ALL DEPOSITS THEREIN, AND (VI) TO THE
EXTENT NOT OTHERWISE INCLUDED, ALL PROCEEDS (AS DEFINED IN THE UCC).
(B)
GRANT OF SECURITY.
AS SECURITY FOR THE OBLIGATIONS (AS
HEREINAFTER DEFINED), GRANTOR HEREBY DELIVERS, ASSIGNS, PLEDGES, SETS OVER AND
GRANTS TO SECURED PARTY A FIRST PRIORITY SECURITY INTEREST IN, ALL OF ITS RIGHT,
TITLE AND INTEREST, WHETHER NOW EXISTING OR HEREAFTER ARISING OR ACQUIRED, IN
AND TO THE COLLATERAL, TOGETHER WITH ALL SUBSTITUTIONS AND REPLACEMENTS THEREOF
AND ANY PRODUCTS AND PROCEEDS THEREOF.
(C)
SECURITY FOR OBLIGATIONS.
THIS AGREEMENT SECURES THE PAYMENT OF
ALL NOW EXISTING OR HEREAFTER ARISING OBLIGATIONS OF GRANTOR TO SECURED PARTY,
WHETHER PRIMARY OR SECONDARY, DIRECT OR INDIRECT, ABSOLUTE OR CONTINGENT, JOINT
OR SEVERAL, SECURED OR UNSECURED, DUE OR NOT, LIQUIDATED OR UNLIQUIDATED,
ARISING BY OPERATION OF LAW OR OTHERWISE UNDER THE LOAN AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BUT ONLY TO THE EXTENT REQUIRED UNDER THE LOAN AGREEMENT OR ANY
OTHER CREDIT DOCUMENT, WHETHER FOR PRINCIPAL, INTEREST, FEES, EXPENSES OR
OTHERWISE, TOGETHER WITH ALL COSTS OF COLLECTION OR ENFORCEMENT, INCLUDING,
WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES INCURRED IN ANY COLLECTION
EFFORTS OR IN ANY ACTION OR PROCEEDING (ALL SUCH OBLIGATIONS BEING THE
"OBLIGATIONS").
(D)
GRANTOR REMAINS LIABLE.
THIS AGREEMENT SHALL NOT AFFECT GRANTOR'S
LIABILITY TO PERFORM ALL OF ITS DUTIES AND OBLIGATIONS UNDER THE TRANSACTIONS
GIVING RISE TO THE OBLIGATIONS.
THE EXERCISE BY SECURED PARTY OF ANY OF THE
RIGHTS HEREUNDER SHALL NOT RELEASE GRANTOR FROM ANY OF ITS DUTIES OR OBLIGATIONS
UNDER THE TRANSACTIONS GIVING RISE TO THE OBLIGATIONS, WHICH SHALL REMAIN
UNCHANGED AS IF THIS AGREEMENT HAD NOT BEEN EXECUTED.
SECURED PARTY SHALL NOT
HAVE ANY OBLIGATION OR LIABILITY UNDER THE