Dividends prohibited.
R.I. Gen. Laws § 7-6-31
in effect7-6-31. 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.
P.L. 1984, ch. 380, § 1; P.L. 1984, ch. 444, § 1; P.L. 1987, ch. 472, § 1.
Source: State of Rhode Island General Assembly (rilegislature.gov)URL: https://webserver.rilegislature.gov/Statutes/TITLE7/7-6/7-6-31.htmFetched: 10/20/2026