Arkansas LLC Operating Agreement

Key Takeaways

• While Arkansas doesn’t mandate an LLC Operating Agreement, it’s often beneficial.
• Use our free Arkansas LLC Operating Agreement template to comply with the state laws.
• To establish an LLC in Arkansas, you’ll need to file Articles of Organization with the Arkansas Secretary of State, designate a registered agent, and meet the specified filing fee requirements.

Arkansas LLC Operating Agreement Templates by Type

Single Member LLC

Basic Single Member LLC Operating Agreement

Used 4,920 times

Are you required to uphold your limited liability corporation status in accordance with state law? If the business is sued, the owner’s assets may be safeguarded by this agreement.

Use Basic Single Member LLC Operating Agreement

In Arkansas, when the sole ownership of an LLC rests with one individual, this operating agreement template is crafted to address your specific requirements.

Multi Member LLC

Multi-Member LLC Operating Agreement Template

Used 4,872 times

Ensure that your newly formed LLC is run the right way by having a multi-member operating agreement in place.

Use Multi-Member LLC Operating Agreement Template

When multiple individuals or entities co-own an LLC in Arkansas, this operating agreement template is tailored to facilitate effective collaboration and governance.

50/50 LLC

50/50 LLC Operating Agreement Template

Used 4,872 times

This free 50/50 LLC Operating Agreement template for businesses with equal ownership.

Use 50/50 LLC Operating Agreement Template

In Arkansas, when two partners equally share ownership and management duties within an LLC, this operating agreement template provides a comprehensive framework for their partnership.

Member-managed LLC

Member-Managed LLC Operating Agreement Template

Used 4,919 times

A manager is chosen by the firm owners to oversee day-to-day operations in a manager-managed LLC. Use this Member-Managed LLC Operating Agreement Template right away.

Use Member-Managed LLC Operating Agreement Template

If management responsibilities of an LLC in Arkansas are delegated to appointed members, this operating agreement template offers clarity and structure.

Legal Requirements

Having no LLC Operating Agreement in Arkansas disputes default to Arkansas law (ACA § 4-38). These rules suffice for simple businesses but may not cater to complex ownership structures or those seeking more operational flexibility. The agreement also helps distinguish personal and business matters, crucial for single-member LLCs’ limited liability.

Moreover, even if not state-required, Operating Agreements might be essential when interacting with business partners, investors, or banks. These entities typically prefer a formal agreement to comprehend the LLC’s operation and dispute resolution methods.

How to Form LLC in Arkansas

Establishing an LLC in Arkansas can be straightforward with the right guidance.

The process involves five crucial steps:

1. Preparation: This includes choosing a unique business name and a Registered Agent.
2. Filing the Certificate of Formation: This is done with the State of Arkansas.
3. Applying for an EIN: This is done with the IRS.
4. Obtaining an Operating Agreement: This document outlines the internal operations of the LLC.
5. Handling Ongoing Compliance and Maintenance: This ensures the LLC remains in good standing.

An LLC combines a corporation’s liability protection with a partnership’s tax benefits. You’re not personally liable for the business’s debts or obligations as the owner. This protection can be vital for sole proprietors, as it safeguards personal assets like your home or savings if the company faces legal or financial challenges.

Arkansas LLC Laws

The Revised Uniform Limited Liability Company Act, enacted as Act 1041 of 2021, has significantly changed the LLC laws in Arkansas. This Revised Act applies to all LLCs in Arkansas, regardless of their formation date.

• Manager-managed
  One fundamental change is in the management structure of LLCs. Previously, all were required to specify in their Articles of Organization whether they were manager-managed. Under the Revised Act, the operating agreement determines the management structure. If the deal doesn’t specify, the LLC is presumed to be member-managed.

• The Member’s Authority
  Another significant change is in the principles relating to member authority. Under the old act, members had presumptive authority to sign binding business instruments. The Revised Act doesn’t provide any presumptive authority; instead, agency law is used to determine authority.

• To provide clarity, the Revised Act allows an LLC to file a Statement of Authority. This statement includes basic information about the LLC and specifies the authority granted to positions and persons within the LLC. Once accepted by the Secretary of State, it provides conclusive proof of a party’s authority on behalf of the LLC.

These changes impact every loan transaction involving an Arkansas LLC. Lenders should review and update their underwriting guidelines in response to these changes. 

They should also be aware of determining the management structure of LLC clients. This involves consulting the operating agreement for LLCs formed on or after September 1, 2021, and referring to the LLC’s Articles of Organization and the operating agreement for LLCs formed before this date.