Prenuptial agreements, or prenups, are highly recommended for owners of closely held businesses.
After all, the future Husband and Wife may not be the only ones impacted by a prenup, or lack of same. There may be children.
And there may be other extended family members also affected.
A prenuptial agreement is the only way of protecting the interests of all those other folks and the business itself, in addition to the actively involved future spouse.
For the faint-hearted future spouse uncomfortable with broaching the subject, there is a simple solution.
Incorporate the requirement of a prenuptial agreement right into the shareholders’ agreement or members’ agreement, or other business management documents.
This approach makes the prenup mandatory, but depersonalizes the issue.
After all, divorce of a principal is de-stabilizing to the entire business, and the threat of a fragmentation of a spouse’s ownership interest and rights threatens harmonious management.
A prenup can specify ownership, voting rights, valuation, buyout where appropriate, characterize property as marital or nonmarital by agreement, and provide for death of a future spouse as well as the possibility of divorce. As well as other issues.