Arkansas Code
Subchapter 3 - Organization
§ 23-37-306. Mutual associations — Expense fund requirement

(a) In addition to the savings account subscriptions required by this chapter, the incorporators of a mutual association must show to the satisfaction of the Supervisor of Savings and Loan Associations that an expense fund has been subscribed and paid in to the credit of the proposed association equal to not less than one-third (1/3) of the required savings accounts, from which expense fund the expenses of organizing the association and its operating expenses, in addition to such dividends as may be declared and paid or credited to its savings account holders, may be paid until such time as its earnings are sufficient to pay them.
(b) The amount so contributed to the expense fund shall not constitute a liability of the association except as provided in this section.
(c)
(1) The contributions may be repaid pro rata to the contributors from the net earnings of the association after provision for required loss reserve and payment of dividends declared on savings accounts.
(2) In case of a liquidation of an association before contributions to the expense fund have been repaid, any contributions to the expense fund remaining unexpended after payment of all creditors, the expenses of liquidation, and the withdrawal value of all savings accounts shall be paid pro rata to the contributors.

(d) Contributors to the expense fund shall be paid dividends, and for such purposes their contributions shall be considered as savings accounts of the association.

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