Arkansas: Corporation Voluntary Dissolution and Closure Requirements
The short answer
Arkansas lets a majority of incorporators or initial directors use a shortcut if the corporation has either issued no shares or not begun business, but all debts must be paid and remaining assets distributed. Otherwise the board proposes dissolution and shareholders approve by a majority of all votes entitled unless a higher or group vote applies. File $45 online or $50 paper articles plus the final franchise-tax report and payment. Optional 120-day known-claim and five-year publication procedures and a 120-day revocation route follow.
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This is the general rule in Arkansas. Ask about your specific facts and see which parts of current Arkansas law apply, with citations to the statutes.
| Governing law, entity, and route scope | Arkansas Business Corporation Act of 1987, Ark. Code tit. 4, ch. 27; Secretary of State; domestic voluntary routes under §§ 4-27-1401 to -1407 |
|---|---|
| Pre-share or pre-business simplified route | Majority of incorporators or initial directors if either no shares issued OR business not commenced; articles also recite incorporation date, chosen eligibility fact, no unpaid debt, distribution of remaining net assets if shares issued, and authorization (§ 4-27-1401) |
| Board proposal, recommendation, and conditions | Board proposes and recommends unless conflict/special circumstances justify no recommendation and basis is communicated; submission may be conditioned on any basis. No express abandonment after approval, apart from 120-day revocation (§§ 4-27-1402, -1404) |
| Shareholder notice, vote, consent, and groups | Notify every shareholder and state dissolution purpose; meeting notice ordinarily 10-60 days. Default vote is majority of all votes entitled, unless articles/board require greater or voting groups. Written consent uses meeting threshold; nonvoting shareholders receive 10-day advance notice; no collection period stated (§§ 4-27-704, -705, -1402) |
| Dissolution filing, signer, fee, and effect | Ordinary articles state name, authorization date, shareholder vote totals, and separate group totals; shortcut adds § 1401 recitals. Chair, president/other officer, qualifying incorporator, or court fiduciary signs. Effective on filing or delayed up to 90 days; $45 online/$50 paper (§§ 4-27-120, -123, -1401, -1403; SOS) |
| Reports, tax clearance, and agency steps | Proof of franchise-tax payment accompanies filing. Current SOS requires Final Franchise Tax Report with articles: prior-year tax plus current-year minimum; form shows $150 stock/$300 nonstock minimum. No separate DFA clearance, publication, or employment-agency prerequisite shown (§ 4-27-120(i); § 26-54-105(d)(1); SOS) |
| Winding up, liabilities, and distributions | Existence continues only to wind up: collect assets, dispose of property, discharge or provide liabilities, then distribute remaining property by shareholder interests. Title, suits, pending proceedings, governance rules, and registered-agent authority continue (§ 4-27-1405) |
| Known, unknown, and contingent claims | Optional known-claim process: at least 120 days to claim and 90 days to sue after rejection; excludes contingent/future-event claims. Optional one-time newspaper notice gives 5-year suit bar for unknown, unacted, contingent, and later-event claims; shareholder liability capped by pro rata share/distribution. No court-set reserve route stated (§§ 4-27-1406 to -1407) |
| Revocation, termination, and survival | Revoke within 120 days by same authorization unless original approval allowed board-only action; file revocation articles plus dissolution copy, $150 paper, with relation back. No later terminal filing; corporation continues for winding up and proceedings (§§ 4-27-1404 to -1405; SOS) |
| Foreign, insolvency, and judicial boundaries | Domestic articles do not withdraw foreign registrations; an Arkansas-authorized foreign corporation obtains a separate withdrawal certificate. Deadlock, oppression/fraud, waste, creditor insolvency, or court-supervised voluntary dissolution uses § 4-27-1430, not the consensual route; bankruptcy remains separate (§§ 4-27-1430, -1520) |
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Authorization and the shortcut
Under §§ 4-27-1401 to -1403, Arkansas's shortcut applies if either no shares have issued or the
corporation has not begun business. It is not filing-only: no corporate debt may
remain unpaid, and if shares issued, the remaining net assets after winding up
must already have been distributed. A majority of the incorporators or initial
directors authorizes the articles.
For the ordinary route, §§ 4-27-1402 and 4-27-1403 require the board to propose
and ordinarily recommend dissolution. A conflict or special circumstance may
support no recommendation if the board tells shareholders why, and the board may
condition the submission on any basis.
Shareholder approval
Unless the articles or the board require more or require voting groups, the
proposal needs a majority of every vote entitled to be cast—not merely a
majority of votes present. The corporation notifies every shareholder of the
meeting, including nonvoters, and states that dissolution is a meeting purpose.
Under §§ 4-27-704 and 4-27-705, the general 10-to-60-day meeting window applies
and the sections allow written consent at the meeting threshold. When consent replaces a meeting,
nonvoting shareholders receive at least 10 days' advance notice.
Articles, fee, and effective date
Ordinary articles state the name, authorization date, and shareholder vote
totals; voting-group totals are reported separately when required. The shortcut
articles instead must include every additional § 4-27-1401 recital. Under
§§ 4-27-120 and 4-27-123, a chair, president or other officer, qualifying
incorporator, or court fiduciary signs, and a delayed effective date may be no
more than 90 days after filing.
The current Secretary of State table lists DN-10 at $45 online or $50 on paper.
The paper form is designed around the ordinary shareholder-vote route, so a
shortcut filer must still supply every statutory shortcut recital even though
DN-10 does not display those fields.
Final franchise tax
Arkansas makes franchise-tax payment part of the filing gate. Under
§ 4-27-120(i), proof of payment must accompany the filing, and
§ 26-54-105(d)(1) requires the prior-calendar-year tax plus the minimum tax for
the year of dissolution. The current Final Franchise Tax Report must be
submitted with the articles and lists a $150 minimum for a stock corporation
and $300 for a nonstock corporation.
Winding up and claims
Under §§ 4-27-1405 to -1406, the dissolved corporation continues only to wind up: collect
and dispose of assets, discharge or provide for liabilities, and distribute the
remainder according to shareholder interests. Title stays with the corporation,
new and pending proceedings continue, and the registered agent remains
authorized.
Sections 4-27-1406 and § 4-27-1407 offer optional claim-bar procedures. Written
notice to known claimants gives at least 120 days to submit and, after rejection,
90 days to sue. One newspaper publication starts a five-year period for unknown,
unacted, contingent, and post-dissolution-event claims. The statute caps a
shareholder's exposure at the lesser of the pro rata claim share or liquidation
distribution, with an aggregate cap equal to the distribution.
Revocation and boundaries
Under § 4-27-1404, dissolution may be revoked within 120 days by the same approval
method, unless the original authorization allowed the board to act alone. The
corporation files revocation articles with a copy of its dissolution articles;
the current paper fee is $150. Effect relates back to the dissolution date.
Arkansas has no later terminal filing after winding up. Under §§ 4-27-1430 and
4-27-1520, a foreign corporation uses a separate withdrawal certificate, while deadlock, oppression,
fraud, waste, creditor insolvency, or voluntary dissolution under court
supervision belongs to the judicial route rather than this ordinary consensual route.
Statutes and sources
Source links
Every statute quoted above, linked, with the date we checked it.
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