§7-6-31  Dividends prohibited. –

Published: 2015

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Corporations, Associations, and Partnerships


Rhode Island Nonprofit Corporation Act

SECTION 7-6-31

   § 7-6-31  Dividends prohibited. –

A corporation may issue shares to its members, but no dividend shall be paid on

the shares and no part of the income or profit of a corporation shall be

distributed to its members, directors, or officers, except that dividends may

be paid and income or profit may be distributed to its members by a corporation

all of the members of which are corporations to which this chapter applies. A

corporation may pay compensation in a reasonable amount to its members,

directors, or officers for services rendered, may confer benefits upon its

members in conformity with its purposes, and upon dissolution or final

liquidation may make distributions to its members as permitted by this chapter,

and no payment, benefit, or distribution is deemed to be a dividend or a

distribution of income or profit.

History of Section.

(P.L. 1984, ch. 380, § 1; P.L. 1984, ch. 444, § 1; P.L. 1987, ch.

472, § 1.)