Jeremy Goldstein on How Knockout Options Can Protect You

As of late, there has been a growing trend amongst many of the largest corporations across the globe to not use stock options as an incentive for their employees. While there is a myriad of complex reasons for many of these corporations’ departure from the traditional package of offering stock options, the central issue revolves around money. There are a few reasons that many corporations have resulted to taking this course of action, including the volatility associated with a fluctuating market, the risk of option overhang, and a number of accounting burdens that often accompany stock options. According to Jerry Goldstein, the solution to this problem would be to include a knockout clause that would cause employees to lose their option if the stock price drops below a number decided by the company. This can lead to the cutting of accounting costs and it may also protect stockholders from option overhang.

The founder of Jeremy L. Goldstein and Associates, LLC, Jeremy Goldstein created the boutique firm in order to advise Chief Executive Officers, compensation committees, and a multitude of corporations on issues regarding corporate governance and executive compensation. Jeremy Goldstein worked with Wachtell, Lipton, Rosen, and Katz prior to founding Jeremy L. Goldstein and Associates, where he was a partner for a number of years. He attended school at Cornell University, graduating cum laude and receiving a Bachelor of the Arts Degree. He would go on to continue his education at New York University School of Law, and later at the University of Chicago where he attained his M.S.

Jeremy Goldstein has enjoyed a very successful career, playing an important role in many of the top corporate transactions in the United States over the last 10 years, including United Technologies Corporation’s acquisition of Goodrich. Today, Mr. Goldstein spends a lot of his time speaking and writing articles on topics regarding executive compensation and corporate governance. He is a member of the NYU Journal of Law and Business where he sits on the Professional Advisory Board and has been recognized as one of the top executive compensation lawyers in the United States by The Legal 500, as well as Chambers USA Guide to America’s Leading Lawyers for Business. Aside from his legal work, Jeremy Goldstein is also an active contributor to charities such as the New Leadership Council of Make-A-Wish Foundation of Metro New York and Fountain House, where he is a member of the board.


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