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ARTICLE · 15 AUGUST 2013

Stock Options And Beyond

A&O Shearman
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Although stock options continue to be a popular employee incentive device, in the past few years their advantages have been diminished through accounting and tax law changes, whereas their shortcomings have become more apparent in the biotech sector - in which a consistently growing stock price is far from assured, or even likely.

United StatesCorporate/Commercial Law
John Cannon, III
John Cannon, III
Mark Kessel
Mark Kessel
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If you decide to found a company, you need to understand how your investment in time, vision, savings, and blood, sweat and tears is likely to be compensated via equity-based remuneration, particularly stock options. You also need to appreciate how to attract, retain and motivate your employees through appropriately designed equity incentives. Similarly, if you are a researcher leaving academia to work in a startup or even an established biotech company, it would behoove you to familiarize yourself with the stock options or other equity awards that you may be offered as part of your compensation package and the reasons why you and your employer may have different preferences regarding the selection of the form of equity award.

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