Arkansas State Statute Code

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4-27-201

Incorporators.

One (1) or more persons may act as the incorporator or incorporators of a corporation by delivering articles of incorporation to the Secretary of State for filing.

4-27-206.

Bylaws.

  1. The incorporators or board of directors of a corporation shall adopt initial bylaws for the corporation.
  2. The bylaws of a corporation may contain any provision for managing the business and regulating the affairs of the corporation that is not inconsistent with law or the articles of incorporation.

4-27-801.

Requirement for and duties of board of directors.

  1. Except as provided in subsection (c) of this section, each corporation must have a board of directors.
  2. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the corporation managed under the direction of, its board of directors, subject to any limitation set forth in the articles of incorporation.
  3. A corporation having fifty (50) or fewer shareholders may dispense with or limit the authority of a board of directors by describing in its articles of incorporation who will perform some or all of the duties of a board of directors.

4-27-601.

Authorized shares.

  1. The articles of incorporation must prescribe the classes of shares, the number of shares of each class that the corporation is authorized to issue, and a statement of the par value of the shares of each class or a statement that the shares of a class are to be without par value. If more than one class of shares is authorized, the articles of incorporation must prescribe a distinguishing designation for each class, and, prior to the issuance of shares of a class, the preferences, limitations, and relative rights of that class must be described in the articles of incorporation. All shares of a class must have preferences, limitations, and relative rights identical with those of other shares of the same class except to the extent otherwise permitted by § 4-27-602.
  2. The articles of incorporation must authorize (1) one or more classes of shares that together have unlimited voting rights, and (2) one or more classes of shares (which may be the same class or classes as those with voting rights) that together are entitled to receive the net assets of the corporation upon dissolution.
  3. The articles of incorporation may authorize one (1) or more classes of shares that:
    1. have special, conditional, or limited voting rights, or no right to vote, except to the extent prohibited by this chapter, or by the Arkansas Constitution, Article 12, § 8, which guarantees the right of all stockholders to vote on a proposal to increase the capital stock or bond indebtedness of the corporation;
    2. are redeemable or convertible as specified in the articles of incorporation (i) at the option of the corporation, the shareholder, or another person, or upon the occurrence of a designated event; (ii) for cash, indebtedness, securities, or other property; (iii) in a designated amount or in an amount determined in accordance with a designated formula or by reference to extrinsic data or events;
    3. entitle the holders to distributions calculated in any manner, including dividends that may be cumulative, noncumulative, or partially cumulative;
    4. have preference over any other class of shares with respect to distributions, including dividends and distributions upon the dissolution of the corporation.
  4. The description of the designations, preferences, limitations, and relative rights of share classes in subsection (c) of this section is not exhaustive.
  5. The board of directors of an investment company may increase or decrease the aggregate number of shares of stock, or the number of shares of stock of any class, that the corporation has the authority to issue, unless a provision has been legally included in the articles of incorporation of the corporation after May 1, 1989, prohibiting an act by the board of directors to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class that the corporation has authority to issue.
    1. If the board of directors of an investment company increases or decreases the aggregate number of shares of stock or the number of shares of stock of any class that the corporation has the authority to issue in accordance with subsection (e) of this section, the board of directors, before issuing any of the newly authorized stock, shall file articles supplementary for recording with the Secretary of State.
    2. Articles supplementary shall include:
    1. Both as of immediately before the increase or decrease and as increased or decreased: (1) The total number of shares of stock of all classes that the corporation has authority to issue; (2) The number of shares of stock of each class; (3) The par value of the shares of stock of each class or a statement that the shares are without par value; and (4) If there are any shares of stock with par value, the aggregate par value of all the shares of all classes;
    2. A statement that the corporation is registered as an investment company under the Investment Company Act of 1940; and
    3. A statement that the total number of shares of capital stock that the corporation has authority to issue has been increased or decreased by the board of directors in accordance with subsection (e) of this section.
  6. In order to be filed, articles supplementary shall be accompanied by an opinion of legal counsel licensed in this state and familiar with the Investment Company Act of 1940 opining that the statements contained in subdivisions (e)(2)(ii) and (iii) of this section are correct to the best of such counsel's knowledge and said articles supplementary shall be executed in the manner required by § 4-27-120.

4-27-622.

Liability of shareholders.

  1. A purchaser from a corporation of its own shares is not liable to the corporation or its creditors with respect to the shares except to pay the full consideration, fixed as provided by law, for which the shares were issued or were to be issued.
  2. Unless otherwise provided in the articles of incorporation, a shareholder of a corporation is not personally liable for the acts or debts of the corporation except that he may become personally liable by reason of his own acts or conduct.

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LLC

4-32-201.

Formation

One (1) or more persons may form a limited liability company by signing or causing to be signed articles of organization and delivering the signed articles to the Secretary of State for filing. The person or persons who sign the articles of organization causing the formation of a limited liability company need not be members of the limited liability company at the time of formation or after formation has occurred.

4-32-301.

Agency power of members and managers.

  1. Except as provided in subsection (b) of this section, every member is an agent of the limited liability company for the purpose of its business or affairs, and the act of any member, including, but not limited to, the execution in the name of the limited liability company of any instrument, for apparently carrying on in the usual way the business or affairs of the limited liability company of which he or she is a member, binds the limited liability company, unless the member so acting has, in fact, no authority to act for the limited liability company in the particular matter, and the person with whom the member is dealing has knowledge of the fact that the member has no such authority.
  2. If the articles of organization provide that management of the limited liability company is vested in a manager or managers:
    1. No member solely by reason of being a member is an agent of the limited liability company; and
    2. Every manager is an agent of the limited liability company for the purpose of its business or affairs, and the act of any manager, including, but not limited to, the execution in the name of the limited liability company of any instrument, for apparently carrying on in the usual way the business or affairs of the limited liability company of which he is a manager binds the limited liability company, unless the manager so acting has, in fact, no authority to act for the limited liability company in the particular matter, and the person with whom the manager is dealing has knowledge of the fact that the manager has no such authority.
  3. An act of a manager or a member which is not apparently for the carrying on in the usual way the business or affairs of the limited liability company does not bind the limited liability company unless authorized in accordance with an operating agreement, at the time of the transaction or at any other time.
  4. No act of a manager or member in contravention of a restriction on authority shall bind the limited liability company to persons having knowledge of the restriction.

4-32-304.

Liability of members to third parties.

Except for the personal liability for acts or omissions of those providing professional service as set forth in § 4-32-308, a person who is a member, manager, agent or employee of a limited liability company is not liable for a debt, obligation, or liability of the limited liability company, whether arising in contract, tort, or otherwise or for the acts or omissions of any other member, manager, agent, or employee of the limited liability company.