Arkansas: LLC Operating Agreement Requirements

Requirements one by one

Governing law and document name

Arkansas Code § 4-38-101 names chapter 38 the Uniform Limited Liability Company
Act. Section 4-38-102(13) uses “operating agreement” for all members' agreement
about the company's internal relations, management, activities, and amendment
process, even if the parties call it something else.

Required or optional

Arkansas does not impose a general adoption mandate. Arkansas Code § 4-38-105(d)
makes the Act the gap-filler: “To the extent the operating agreement does not provide
for a matter ... this chapter governs the matter.” An LLC without an agreement
therefore uses the statutory defaults rather than failing to form for lack of one.

Permitted form and signatures

Section 4-38-102(13) recognizes an agreement that is oral, implied, in a record, or
any combination of those forms. A “record” includes information on a tangible medium
or stored electronically or otherwise in retrievable form under § 4-38-102(18).
Chapter 38 adds no general agreement-level signature, witness, acknowledgment, or
notarization ceremony.

A separate transaction or promise may still require a signed or recorded instrument
under law outside the LLC Act.

Adoption timing and effect

Prospective initial members may settle terms before filing. Arkansas Code
§ 4-38-106(c) says the terms become the operating agreement “upon the formation of
the company”; one prospective sole member may do the same. Section 4-38-201(d)
places formation when the certificate becomes effective and at least one person has
become a member or manager.

There is no general adoption deadline. Until an agreement becomes effective or
covers a subject, § 4-38-105(d) supplies the statutory rule.

Single member and assent

The definition in § 4-38-102(13) expressly includes a sole member. Section 4-38-106
also makes the company bound without separately assenting and deems each person who
later becomes a member to assent to the existing agreement.

Management and authority defaults

Arkansas Code § 4-38-407 defaults to member-management unless the agreement says the
LLC is manager-managed, managed by managers, or uses similar words. In the default
structure, every member has equal management rights, a majority of the members
decides an ordinary-course difference, and all members must approve an
outside-ordinary-course act. A manager-managed company places company matters with
the manager or a majority of multiple managers, subject to the listed all-member
approvals.

Internal management is not the same as power to bind outsiders. Section 4-38-301
says a member is not the company's agent solely because of member status. Under
§ 4-38-302, the LLC may file a statement granting or limiting a position's or
person's authority, including authority to transfer company real estate or enter
other transactions.

Voting, economic, and transfer defaults

Section 4-38-407 uses equal member management rights and a per-capita majority for
ordinary-course differences, not contribution or ownership percentages. Section
4-38-404 allocates interim distributions in equal shares unless the agreement
validly changes that result.

After formation, § 4-38-401 generally requires all-member consent to admit a person
when the agreement and another statutory transaction route do not supply admission.
A “transferable interest” is the right to distributions under § 4-38-102(24).
Transferring that interest under current § 4-38-502(a) does not itself give the buyer
management participation or ordinary company-information rights.

Nonwaivable rules and duties

Arkansas Code § 4-38-105 preserves a statutory floor. The agreement cannot eliminate
good faith and fair dealing, unreasonably restrict information or member-action
rights, change the listed judicial-dissolution grounds, or use the contract to defeat
protected nonparty rights. Loyalty, care, and other fiduciary duties may be altered
or, in specified respects, eliminated only within the section's statutory and
manifest-unreasonableness limits; a care term cannot authorize bad faith, willful or
intentional misconduct, or a knowing legal violation.

Section 4-38-409 assigns loyalty and care to members in a member-managed LLC and to
managers in a manager-managed LLC. Section 4-38-410 separately protects access to
material company information, using a purpose-specific demand in a record for a
nonmanager member of a manager-managed company.

The agreement also cannot erase every court remedy. Section 4-38-701 preserves
judicial dissolution for unlawfulness, impracticability, fraud, illegality, or
directly harmful oppression on the stated facts.

Amendment, filing, and records

Without a different agreement term, § 4-38-407 requires all members to approve an
amendment in either management structure. Section 4-38-107(a) lets the agreement
require a nonparty's approval or satisfaction of another condition.

The operating agreement is not among the required public certificate contents in
§ 4-38-201. If an effective filed record conflicts with the private agreement,
§ 4-38-107(d) makes the agreement control among members, managers, transferees, and
dissociated members, while the filed record can control for an outsider who
reasonably relies on it.

Because Arkansas recognizes oral and implied agreements, chapter 38 does not impose
a general duty to create or publicly file a written copy. Section 4-38-410 governs
access to records the company does maintain and to other material company
information.

What trips people up

Equal management rights do not create automatic agency. A member-managed
Arkansas LLC gives every member an internal voice, but § 4-38-301 rejects agency
based only on membership. Authority for a transaction must come from another source,
and a filed statement under § 4-38-302 can matter to outsiders.

The default vote counts members, not ownership percentages. In an ordinary-course
difference, § 4-38-407(b) uses a majority of the members. A percentage-interest vote
requires a valid agreement term.

A transfer normally separates economics from governance. The buyer of a
transferable interest receives the associated distribution right but does not
automatically become a member or receive management and ordinary information rights.

Common questions

May an Arkansas LLC use a manager who is not a member? Yes. Section 4-38-407
says a person need not be a member to serve as manager.

Can members approve a transaction that would otherwise violate loyalty? All
members may authorize or ratify a specific transaction after full disclosure of all
material facts under § 4-38-409(f). The agreement may also prescribe a compliant
authorization method within § 4-38-105's limits.

Can a member seek judicial dissolution for oppressive conduct? Section
4-38-701(a)(4) permits a member application when controlling managers or members have
acted or are acting oppressively in a way directly harmful to the applicant. The
court may order a remedy other than dissolution under subsection (b).

Statutes and sources

• Ark. Code §§ 4-38-101, 4-38-102 — Act name; flexible-form, sole-member
  agreement definition; record and transferable-interest definitions.
  https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)
• Ark. Code §§ 4-38-105-.107 — agreement scope, statutory limits, company and
  member assent, preformation terms, amendment conditions, and filed-record
  conflicts. https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)
• Ark. Code § 4-38-201 — certificate contents and formation time.
  https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)
• Ark. Code §§ 4-38-301-.302 — no agency from membership alone and filed
  statements of authority. https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)
• Ark. Code §§ 4-38-401, 4-38-404, 4-38-407 — admission, equal distributions,
  management, voting, manager eligibility, and default unanimous amendment.
  https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)
• Ark. Code § 4-38-502 — current transfer consequences after 2023 Act 795.
  https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2023R%2FPublic%2FACT795.pdf
  (accessed 2026-07-26)
• Ark. Code §§ 4-38-409-.410, 4-38-701 — duties, good faith, information
  rights, and protected judicial-dissolution grounds.
  https://www.arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2021R%2FPublic%2FACT1041.pdf
  (accessed 2026-07-26)