Rooting Moto E
Note: Rooting your phone may lead to void warranty. Do at your own risk. Techulator/author is not responsible for bricked phone.
To change your soft keys style from KitKat to Lollipop you need to root your Moto E. To root your phone you need to unlock the boot loader of your phone. After unlocking you need to install TWRP recovery. From TWRP recovery you will be installing the SuperSU zip file. So the ultimate aim is to install SuperSU zip file in your phone. If you install SuperSU successfully your phone will be rooted.
Prepare you computer
You need to have a computer running Windows OS to proceed with rooting steps. In your computer you need to install ADB Fastboot and Motorola Drivers. Without Motorola Drivers your PC won't detect your phone. Fastboot is a tool used for flashing Android device. With Fastboot you can flash any Android device provided you have required apps.
I followed the rooting procedure from XDA-Forum. I recommend you to download all necessary tools for rooting from there.
Rooting Moto E - http://forum.xda-developers.com/showthread.php?t=2755336
This is trusted source and I have rooted all my Android mobiles referring this website. You can also get support from developers if something goes wrong. Below is the screen shot of my phone after rooting installing required apps.
Applying Android Lollipop theme
To get the theme like Android Lollipop you need to download Xposed framework. You can download the Xposed installer from below link.
Xposed apk - http://repo.xposed.info/module/de.robv.android.xposed.installer
To install this framework you must have root permission. After successful installation restart your phone. Now you need to install a module which make use of this Xposed framework. The name of the module is xStana. It is available as an app in Play Store. You can simply search for xStana in Play Store or use the below direct link.
xStana apk - http://repo.xposed.info/module/lfprodev.xposed.xstana
After installing the xStana module open Xposed framework app. In modules tab check the xStana module check box. Now you have given permission to this module. Now open the xStana and choose AOSP L preview to get the Android L soft keys. There are wide range of navigation bar and status bar and you can apply on your preference.
That is a really in depth tutorial on rooting. Simple and lucid, it just tells what you need to do- without unnecessary jargon. A blessing for those wanting to root their Moto E.
Installing the modules can brick your phone, so I would suggest that you do not download it if you cannot recover the soft brick.