Jeff Bezos, the founder and CEO of Amazon and the wealthiest person in the world, announced Wednesday that he and his wife, MacKenzie Bezos, would divorce.
They have been married for 25 years and have four children together.
Bloomberg estimates that Jeff Bezos is worth $137 billion, and Amazon has reached a $792 billion market cap.
At this point, it's unclear how he and MacKenzie Bezos, a novelist, will divide their assets upon their divorce. TMZ reported that the Bezoses did not sign a prenuptial agreement, according to "sources with direct knowledge" of the situation. Most of the Bezoses' net worth is in the form of Amazon stock, Business Insider's Troy Wolverton reported, meaning that MacKenzie Bezos could wind up with a substantial stake in the company.
Jeff Bezos founded Amazon after his marriage to MacKenzie (they met when they were both working at the investment management firm D.E. Shaw in New York) and MacKenzie Bezos was one of Amazon's earliest employees. It's possible that they signed a postnuptial agreement after Amazon took off.
So what's the difference between a prenuptial agreement, commonly known as a "prenup," and a postnuptial agreement, or "postnup"?
Some couples sign a postnup years after getting married, when they realize there are issues that could threaten their relationship
A prenup is a legally binding contract two people sign before marrying that covers financial issues and the future of assets in the event of a divorce, Kelly Frawley, a partner specializing in matrimonial and family law at Kasowitz Benson Torres, told Business Insider's Hillary Hoffower last year.
Hoffower reported that prenups were once stigmatized but are quickly regaining favor among millennial couples.
A postnup is similar to a prenup, but it takes place after a couple marries. As Heather Locus, the head of the divorce practice group at Balasa Dinverno Foltz, wrote for Forbes, "a postnup is an effective way to document intentions for earnings and assets during the marriage as well as in the event of a future divorce."
Couples typically sign a postnup either when they didn't have time to sign a prenup before the wedding or when they are "aware of issues that threaten their relationship and want to gain clarity on areas of conflict," Locus said.
The Bezoses reportedly did not sign a prenup, which would have covered issues like defining separate and marital property, when they were living in New York. According to the New York City Bar Association's legal-referral service, that's the difference between property that will belong to just one person in the event of a divorce, and property that will belong to both partners.
If the couple signed a postnup when they were living in Seattle, it might have defined property rights for assets they acquired after marriage (like earnings from Amazon).
If Jeff and MacKenzie Bezos didn't sign a postnup either, their assets would be split 50/50 by a judge. Washington is a community-property state, meaning all assets and debts a couple acquires during marriage are the property of both spouses — so, as Business Insider's Tanza Loudenback reported, if they split up, each is entitled to half of the assets.
In a statement posted on Jeff Bezos' Twitter account on Wednesday, he and MacKenzie Bezos said they "see wonderful futures ahead, as parents, friends, partners in ventures and projects, and as individuals pursuing ventures and adventures."
- Read more:
- Amazon CEO Jeff Bezos and his wife, MacKenzie, announce they are divorcing
- A look inside the 25-year marriage of the richest couple in history, Jeff and MacKenzie Bezos — who met at work, were engaged in 3 months, and together owned more land than almost anyone else in America
- We did the math to calculate how much money Jeff Bezos makes in a year, month, week, day, hour, minute, and second
- See inside the secretive Seattle suburb that's home to Jeff Bezos and Bill Gates, where streets are lined with opulent waterfront mansions behind tall gates and security cameras
