Vesting
Each Cabot participant is at all times 100% vested in his or her contributions. All participants are at all times 100% vested in the Company
match and earnings thereon, and are vested in the Company retirement contribution upon completion of 2 years of service. In addition, a participants entire account balance becomes 100% vested and payable upon the participants attainment
of age 65, disability, or death.
Distribution of Benefits
The benefit to which a participant is entitled is the benefit that can be provided from the participants vested account. Benefits may be
distributed to participants upon termination of employment by reason of retirement, disability, death or other severance of employment. Participants who terminate employment and have a vested account balance of less than $1,000 will receive a lump
sum distribution of 100% of their vested benefits. Distributions for participants with vested account balances greater than $1,000 but not in excess of $5,000 who terminate employment and fail to make a distribution election will be paid to an
individual retirement account designated by the plan administrator. Effective August 1, 2016, participants who have attained age 55 may elect to receive benefit payments in cash installments or a lump sum distribution. Participants who have not
attained age 55 must receive benefit payments in a lump sum distribution.
A participant may withdraw up to 100% of his or her before-tax or Roth contributions upon showing a financial hardship exists, as defined by the Plan, but only after the participant has withdrawn all other vested benefits from the Plan and the maximum loan has been
made from the participants account. Participants may withdraw at any time any after-tax contributions made.
A participant may make withdrawals from his or her entire vested account balance once the participant reaches age 59 1/2.
A participant may elect
to defer payment of a benefit until April 1 following the year that the participant reaches age 70 1/2.
Participant Loans
Cabot
employees may obtain loans from the Plan in an amount not to exceed, in the aggregate, the lesser of $50,000 or 50% of the total vested amount in the participants account. Each loan must be paid in full within five years through payroll
deductions and is secured by the participants remaining account balance. The Plan provides that loans may bear interest at reasonable rates as determined by the Benefits Committee of the Company. The interest rate is currently the prime rate
plus 2%, and is adjusted quarterly for new loans to reflect changes in the prime rate. Interest rates on outstanding loans as of December 31, 2019 ranged from 3.25% to 7.5% per annum. Participant loans are classified as notes receivable from
participants on the Statements of Net Assets Available for Benefits.
2.
|
Summary of Significant Accounting Policies
|
Basis of Accounting
The
accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP).
Recent Accounting Pronouncements In August, 2018, FASB issued ASU 2018-13, Fair Value
MeasurementDisclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance is effective for fiscal years, and interim periods within those fiscal years, beginning
after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. The Plan is currently assessing the timing and impact of adopting the updated provisions.
Use of Estimates
The
preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of additions and deductions during the reporting period. Actual amounts could differ from those estimates.
Risk and Uncertainties
The Plan provides for various investment options in any combination of mutual funds, Company common stock fund, and a common collective trust.
Investment securities are exposed to various risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment
securities will occur in the near term and that such changes could materially affect participants account balances and the amounts reported in the financial statements.
5