Marriage and prenuptial agreements are challenging in all circumstances as people who are entering into a marriage are often reluctant to ask their future spouse to sign one.
These agreements can be especially important however where one spouse owns shares in a family company because a separation could not only affect that spouse but the other shareholders as well.
It is possible to put a clause in the shareholders’ agreement that says if any of the shareholders marry they must enter into a prenuptial or marriage agreement and if they don’t their shares will be forfeited to the company. This takes the pressure off of the spouse because he or she is required to have such an agreement.
FAQ
1) When is the best time to make a prenuptial or marriage agreement?
It’s best to make a prenuptial or marriage agreement well before the wedding to allow you and your partner time to understand the agreement and not feel pressured into signing it, however, this type of agreement can be made before or after a wedding.
2) What is the difference between a prenuptial agreement and a marriage agreement?
These are effectively the same thing and both set out what happens with division of property, spousal support, and other financial arrangements in the event of a divorce or separation. The key difference is the timing, i.e. a prenuptial agreement is signed before the marriage and a marriage agreement is signed any time after the marriage.
3) What if my partner and I are not getting married but want to have this type of agreement in place?
If you and your partner are living together in a common-law relationship but do not intend to marry, we can create a cohabitation agreement for you which outlines the rights, responsibilities, and expectations of both parties during the relationship, and what will happen if the relationship ends.
Deborah A. Todd
Do you have a question about prenuptial agreements and shareholder’s agreements? Request a consultation with Deborah Todd Law today.
