Macfadden continues to support emergency preparedness efforts as a part of USAID's Stamping Out Pandemic and Avian Influenza (STOP AI) team. 
Employee Stock Ownership Plan
Macfadden is an employee-owned company with all of its stock held by the company’s Employee Stock Ownership Plan (ESOP), a federally-regulated employee benefits retirement plan. Macfadden instituted its ESOP in 2004, recognizing the essential role that employees have played in creating our successes and their role in enabling Macfadden to continue providing consistently superior service and effective, dynamic solutions.
The ESOP was initially established when Company founder, Jim Macfadden, transferred 35 percent of Macfadden's stock to the ESOP as the first step in a planned exit from the company. Macfadden formally completed its transition to becoming a 100 percent employee-owned company on March 28, 2007, when the ESOP Trust acquired all of the outstanding shares of
Macfadden not previously owned by the ESOP.
All full-time employees meeting minimum participation requirements receive an annual contribution of Company stock to their individual account within the ESOP. The Company stock is valued on an annual basis by an independent appraiser.
There is no better way for a company to be successful than by providing its employees with a stake in what they do each and every day. Employee ownership provides our employee-owners with a culture of collaboration that drives innovation."
Russell Hall, Former Chairman & CEO
Download Macfadden’s ESOP Owner’s Guide
View ESOP Q&A
What is the purpose of Macfadden's ESOP?
The ESOP at Macfadden has two fundamental purposes. The first was to enable Company founder Jim Macfadden to sell the company to its employees. The second purpose is to provide employees with beneficial ownership of Macfadden stock through annual contributions of stock to individual employee accounts within the ESOP.
What are the main benefits of the ESOP for the Company and its employees?
The major benefit to the Company is to enable it to successfully transition from a founder to a new generation of ownership while maintaining continuity of operations. By keeping ownership of the company among its current employees, the people who work at Macfadden will share in the financial rewards of future company growth, giving all employees a financial incentive to help grow the business and increase shareholder value. In addition, the Macfadden ESOP benefits from federal tax incentives, thereby saving the company money it can use to meet debt payments, invest in new growth strategies and, over the long term, build up sufficient cash assets to repurchase stock from departing employees.
As the beneficial owners of Macfadden stock, the ESOP participants share in the risks and rewards of Company ownership. While there is no guarantee of success, employees who stay with the Company have a chance to realize substantial returns from their ESOP accounts.
Who contributes to the ESOP?
All contributions to the ESOP are from the Company. Employees make no direct cash contributions to the plan. As the Company makes its payments to the bank to service the ESOP’s debt, shares are released from collateral and allocated to the accounts of all ESOP participants on a pro-rata basis.
Who is eligible to participate in the ESOP?
All full-time Macfadden employees who are at least 18 years old and who work at least 900 hours in a given year are eligible to participate in the ESOP.
What is "vesting"?
Vesting is a process by which employees accrue non-forfeitable rights to employer contributions that are made to the employee's qualified ESOP account. ESOP benefits are subject to a vesting schedule whereby an employee has an increasing right over time to the value of his/her ESOP holdings.
What are the employees' share of contributions and forfeitures?
Company contributions to the ESOP are allocated to employees' accounts based on an equal percentage of annual salary. Any forfeitures (unvested stock forfeited by departing employees) are allocated to the accounts of the remaining ESOP participants based on the same allocation formula.
When do employees receive their benefits?
When an employee reaches retirement age as defined in the plan (age 65) they become eligible to begin receiving ESOP benefits within one year. The company may pay the employee in annual installment payments over a period not to exceed five years.
When an employee leaves the company with vested ESOP benefits before reaching retirement age, the company may defer payments for five years and then pay the employee in annual installment payments over a period not to exceed five years.
Why is stock ownership important?
The fundamental idea of the ESOP is to provide all full-time employees with an opportunity to benefit from owning productive capital assets. If the company does well, the employees benefit directly as shareholders through an increase in the value of their stock. Eventually, employees have an opportunity to receive cash for the value of their ESOP holdings. The challenge is to work together effectively to help the company continue to grow and to create value for its employee-shareholders.