Prenuptial Agreements
As the owner of your own business, you become your own boss and have virtually unlimited earning potential. Moreover, as we have found, you attain a sense of achievement and satisfaction not found in working for others.
Today, many business owners may be planning into entering into second or third marriages. They question whether the marriage will work out and if it doesn't will they lose ownership of their business if they get divorced.
Most people want to leave substantial portions of their assets and ownership of business to their natural children. Yet, it is not uncommon for individuals to get married several times.
If you wish to protect your assets from loss in divorce and permit your children to inherit your entire estate, consider entering into a prenuptial agreement prior to a marriage.
Additionally, you should make advance plans regarding ownership and transfer your business in the even of death or disability. In addition to having a formal Last Will and Testament individuals are encouraged to plan ahead prior to a second or third marriage.
People who are about to marry can fix, limit and determine, by agreement, the interest, rights and claims that will accrue to each of them in their property.
To this end, the prenuptial statute requires that each party have the benefit of legal representation.
By signing a Prenuptial Agreement ("Agreement") each party is willing to accept the provisions of this agreement in lieu of any rights which she or he may have in the property and assets of the other.
All property owned, whether real or personal, must be fully disclosed and revealed to each of the parties prior to the execution of the agreement.
It must be signed in ample time prior to a forthcoming marriage.
The following are some sample clauses used by attorneys in drafting the prenuptial agreements.:
Full disclosure Each party hereby acknowledges that she or he has had the opportunity to ascertain, has been fully informed by a full and frank disclosure of, and is fully acquainted with and aware of, all of the income, debts, net worth, financial circumstances and value of the other and value of their property; and each party acknowledges that she or he is aware of, all pending litigation that may effect each of the parties to the within Agreement; and each has ascertained and weighed all of the facts, conditions and circumstances likely to influence her or his judgment in all matters embodied herein; that each has been given due consideration to all such matters and questions and clearly understands and consents to all of the provisions hereof, and is willing to accept the provisions of this
Agreement in lieu of all of the rights in and to the aforementioned described property.
Each Party keeps their own assets
Wife __________ shall during her lifetime keep and retain sole ownership, enjoyment, power, control and disposal of her property, and proceeds of sale thereto, whether by way of gift, devise or other, free and clear of any interest, rights or claims of the other (including rights under community property laws).
Waive, relinquish and release any and all right
Both parties do hereby waive, relinquish and release any and all right, claims or demand of any kind, nature and description which she or he might otherwise acquire or have at any time hereafter in the above-described property of the other, by reason of their marriage to each other (including rights under community property laws) or as surviving spouse, whether by way of intestacy or dower or courtesy, or any other rights which she or he may have as a surviving spouse to share in the estate of the other, or to receive any allowance or exception from the estate of the other or to any right to elect to take against the Will of the other, or the right to act as administrator/administratrix of the estate of the other.
However, either party may expressly provide for their spouse in their Will.
Permission to make Will
Nothing contained herein shall be deemed to constitute a waiver of any bequest or devise that one may choose to make to the other by way of Will or Codicil, or by any gift, grant or conveyance that one may choose to make to the other.
However, each party to the Agreement agrees that no promise of any kind has been made by the other with respect to any such bequest or devise, or of any gift, grant or conveyance.
No property if divorce
In the event of an annulment, separation, legal or by mutual agreement, or the pending of final divorce between the parties hereto either in the jurisdiction of the State of New Jersey or any other state or territory or foreign country, or in the event that the parties hereto have lived apart for a period in excess of ninety (90) continuous days and one of the parties has no intention of returning, each party agrees that there shall be no property settlement or division of property between them with regard to the aforesaid property of the other or any increment, substitute or proceeds thereof, to any of the properties set forth above, but each shall keep and retain sole ownership, enjoyment, control and power of disposal of all properties set forth in Schedule "A"
Separate Property acquired during marriage
It is understood and agreed by and between the parties hereto that any property acquired during the marriage in the name of one party or under circumstances in which it is clear that such property was intended to be acquired separately by one party or where the source of the funds or assets by which such separate property was acquired is premarital assets, shall remain the separate property of the party acquiring such assets, including but not limited to any property into which the same is converted.
Property acquired by gift
It is understood and agreed by and between the parties hereto that any property acquired during the marriage by either party by way of gift or inheritance from a third party shall be deemed the separate property of the party.
Any assets acquired by the parties jointly during the marriage by way of gift or inheritance from a third party shall be deemed joint property acquired during the marriage.
Responsibility for debts
Each party hereto mutually warrants and represents to the other that whatever debtedness (including, but not limited to, any outstanding tax of any nature due any federal, state or local taxing authority) said party has at, or that has been accrued as of, the time of marriage shall be that party's sole and exclusive responsibility, and said party shall indemnify and hold harmless the other for any indebtedness incurred previous to marriage.
Conclusion
The preceding article contains just a few of the possible items to be discussed with your attorney and proposed spouse. The article is by no means exhaustive.
A number of these items may not be applicable in your situation, and probably there are many others that are applicable.
