Importance of Knockout Options by Jeremy Goldstein

Recently, many firms stopped providing employees with stock options. While others are mainly saving money, others have more complicated reasons. The most common causes that persuade companies to stop giving stock options are the stock value may drop substantially making it difficult for employees to exercise their options. Also, employees are aware that economic downturns declare options worthless which is making them keener. Moreover, stock options result in accounting burdens.

 

However, there are advantages of providing these options to employees. Stock options method is preferable to better insurance coverage, equities or additional wages because it is simple for staff members to understand it. Furthermore, options will only boost earnings if the corporation’s share value grows. Thus employees work hard towards the company’s success for extra revenues. Moreover, firms providing shares face higher tax burdens than those providing options.

 

A firm can gain the above advantages if it chooses to provide stock options by adopting the right strategy like knockout barrier option. According to Jeremy Goldstein, knockout works the best among other barrier options. It also protects stockholders as they do not worry much about shrinking ownership shares. However, employees lose the benefits if the share value lowers below a certain amount. Jeremy Goldstein advises employers to cancel the option when the share value remains that low for at least one week.

 

Jeremy is an active partner at Jeremy L. Goldstein & Associates which is a law firm specialized in management teams in executive compensation, advising compensation committees and CEOs. Jeremy Goldstein is a brilliant individual with adequate law skill with 15 years’ experience in the industry.

 

Jeremy Goldstein attended Cornell University earning a BA degree. He then joined New York University School of Law where he graduated with a Juris Doctor. Jeremy has worked for many firms and has played a significant role in significant transactions involving top companies like Chevron and Verizon among others.

 

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October 24, 2017 | Category: Lawyers | Tag: