Corporations, Associations, and Partnerships

Corporations – General Provisions

SECTION 7-1-21

§ 7-1-21. Agreements as to disposition of stock or insurance on death of stockholder.

(a) No agreement in writing, between or among two (2) or more stockholders in a corporation, or between or among a corporation and one or more of its stockholders, whether in either case the agreement is made by all or less than all of the stockholders of the corporation, either previously or subsequently entered into, is deemed testamentary in character, or for that reason invalid or unenforceable, because the agreement contains a provision or provisions: (1) Regulating, in the event of the death of any stockholders, the transfer, distribution, or other disposition of all or any portion of the stock of the deceased stockholder to his or her estate or to the corporation or to or among the other stockholder or stockholders of the corporation or its, his, her, or their assignees, transferees, or successors; or (2) Regulating the destination, distribution, or other disposition of the proceeds of any policy, or policies, of insurance upon the life of any stockholder.

(b) This section is not construed to affect the rights of the heirs, next of kin, legatees, devisees, or creditors of a stockholder who has deceased prior to May 6, 1957.

History of Section.
(G.L. 1938, ch. 116, § 99; P.L. 1954, ch. 3346, § 1; G.L. 1956, § 7-1-21; P.L. 1957, ch. 105, § 1.)