Item 1.01 Entry into a Material Definitive Agreement.
On May 12, 2020 KEMET Corporation, a Delaware corporation ("KEMET" or the
"Company"), a leading global supplier of passive electronic components, entered
into Amendment No. 12 to Loan and Security Agreement, Waiver and Consent, dated
as of May 12, 2020 (the "Loan Agreement Amendment"), by and among KEMET, KEMET
Electronics Corporation ("KEC"), the other borrowers named therein, the
financial institutions party thereto as lenders and Bank of America, N.A., a
national banking association, as agent for the lenders ("Agent"). Pursuant to
the Loan Agreement Amendment, Agent and the lenders party thereto consented to
the purchase of all of the equity interests of the Company by Yageo Corporation
("Yageo") (the "Transaction") and waived all provisions of the Loan and Security
Agreement dated as of September 30, 2010 by and among KEMET, KEC, the other
borrowers named therein, the financial institutions party thereto as lenders and
Agent (as amended, including by the Loan Agreement amendment, the "Loan
Agreement") and related loan documents which may have prohibited or been
violated by the Transaction, including the provisions related to a change in
control of KEMET, as well as waiving potential termination events under certain
hedging transactions. The Loan Agreement Amendment further provided for, among
other changes, (i) revisions to the definition of LIBOR to include a 1% floor,
(ii) mechanics by which the parties may replace the benchmark interest rate used
in the agreement from LIBOR to one or more SOFR-Based Rates, (iii) replacement
of the accounting standard for all financial statements to be delivered to the
Agent under the Loan Agreement from US GAAP to IFRS after the occurrence of the
Transaction and (iv) the imposition of certain restrictions on KEMET, KEC and
the other borrowers' ability to enter into transactions with, and make payments
or distributions to or on behalf of, Yageo and its other subsidiaries and
affiliates. The revolving credit facility under the Loan Agreement is currently
undrawn.
The foregoing description of the Loan Agreement Amendment does not purport to be
complete and is qualified in its entirety by reference to the full text of the
Loan Agreement Amendment, which will be filed as exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ending March 31, 2020.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The information set forth in Item 1.01 above is hereby incorporated by reference
into this Item 2.03.
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