Jeremy Goldstein Tips on Knockout Options over Stock options

Jeremy Goldstein is a legal adviser and current partner at Jeremy L. Goldstein & Associates, LLC. Following the recent trend in corporations refusing to give stock options, Jeremy Goldstein has achieved a better system than stock options with disadvantages as listed below.


The stock option has a considerably higher cost as compared to the financial advantages. To the staff members, it would be a benefit to them if the option was removed as the employers would be forced to pay higher salaries. Another disadvantage is that once there is a decline in the economic, then the options are worthless. The last drawback is that, if there is a financial decline, then there will be the risk of option overhang where compensation of the stocks will only be to key shareholders in the company.


Some of the stock option’s advantages are as follows. To employers, the method of compensation is preferable as compared to better insurance coverage or additional wages. This technique also boosts the employees’ morale to produce more since they are shareholders in the company and earn significantly when the corporations share value rises. Jeremy Goldstein came up with a solution to deal with the many disadvantages got from stock option thus adaptation of a new system by the knockout name system. The system is still a stock awarding system only that it can minimize option overhang and expenses.


The knockout option is similar to the stock option only that employees lose shares whenever the share values fall very low. However, an employee can cancel the stock if the share value of the corporation remains level for at least a week. Employee investors also do not face financial overhang. The system also lowers executive compensation and finally is that this option allows employees the chance to increase product production due to incentives offered. Jeremy Goldstein has also been involved in companies such as Shearman & Sterlin, LLC.


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