Why Jeremy Goldstein Thinks Knockout Options Can Be Beneficial to a Corporation

by , under Law, Lawyers, New York

Attorneys like Jeremy Goldstein, who specializes in part on advising on executive compensation issues, strongly encourage companies to offer stock options to employees. In addition to being easier to offer than equities, employees also understand that the worth of their stock depends on the company’s success. In this way, they contribute to morale and productivity.


To cancel out the risk of accounting headaches for employers due to dropping stock values, Jeremy Goldstein recommends what is commonly referred to as a “knockout” option. With this option, employees only maintain their stock if the value per unit does not drop below a set price for a significant amount of time, usually considered to be a week or more, within their term limit.


This can further contribute to productivity; employees who own stock will likely be more driven to further the success of the company so they can not only avoid losing their investments, but increase their value. Knockout options can also result in fewer accounting costs and more attractive annual earnings reflected to potential and current non-employee stockholders.


After spending 14 years as a partner at Wachtell, Lipton, Rosen & Katz, Jeremy Goldstein founded his own law firm, Jeremy L. Goldstein & Associates, LLC. In addition to executive compensation, he also advises on issues related to corporate governance matters. His legal services have contributed to several of the largest corporate transactions of the last 10 years.


Jeremy Goldstein received his J.D. from New York University School of Law in 1999 and has over 18 years of legal experience. He has also been a regular contributor to the Harvard Law School Forum on Corporate Governance and Financial Regulation over the past decade, and since 2008 has volunteered on the Board of Directors for Fountain House, a charity dedicated to mental illness recovery. Learn more: https://www.avvo.com/attorneys/10019-ny-jeremy-goldstein-978103.html#client_reviews

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