A. At the time of formation, a limited liability company must have at least one member. If a company is to have only one member on formation, the person becomes a member by agreeing to be a member and by being identified as the member in the Articles of Organization.  The member and the organizer may be, but are not required to be, different persons. If the member and organizer are different persons, the organizer acts on behalf of the initial member.

B. If a limited liability company is to have more than one member on formation, those persons become members as agreed by the persons before the formation of the company. the organizer acts on behalf of the persons in forming the company and may be, but is not required to be, one of the persons.

C. After formation of a limited liability company, a person becomes a member by any of the following:

1. as provided in the operating agreement.

2. as the result of a transaction effective under Article 10 of this Chapter.

3. by agreeing to become a member, with the affirmative vote or consent of all the members.

4. as provided in Section 29-3701.A.3.

D. A person may become a member without either:

1. acquiring a transferable interest.

2. making or being obligated to make a contribution to the limited liability company.

E. A transferable interest may be held by two or more natural persons as joint tenants with right of survivorship or by a married couple as community property with right of survivorship.  Except as otherwise provided in this Section, an assignment or issuance of a transferable interest to two or more natural persons creates a tenancy in common, except an assignment or issuance to a married couple.

F. A joint tenancy with right of survivorship is created when a written operating agreement expressly declares that two or more natural persons hold a transferable interest as joint tenants with right of survivorship or in joint tenancy with right of survivorship. a joint tenancy with right of survivorship may also be created by a written assignment of a transferable interest to two or more natural persons, who may include one or more assignors, or by the Articles of Organization, if the written assignment or the Articles have been signed by each joint tenant and contain the express written declaration that the joint tenants hold the assigned transferable interest as joint tenants with right of survivorship or in joint tenancy with right of survivorship.

G. An estate in community property with right of survivorship is created when a written operating agreement expressly declares that a married couple holds a transferable interest as community property with right of survivorship.  An estate in community property with right of survivorship may also be created by a written assignment of a transferable interest to a married couple, who may include one or both assignor spouses, or by the Articles of Organization, if the written assignment or the Articles have been signed by each spouse and contain the express written declaration that the married couple holds the assigned transferable interest as community property with right of survivorship.

H. All co-owners of a transferable interest held as joint tenants with right of survivorship, as community property or as community property with right of survivorship own an equal undivided interest in the transferable interest. Each co-owner of a transferable interest, whether the transferable interest is held as tenants in common, joint tenants with right of survivorship, community property or community property with right of survivorship, shall have only the rights of a transferee with respect to the interest, both during the lifetime and following the death of any other co-owner, unless and until the co-owner becomes a member in accordance with subsection C of this Section.

I. If a transferable interest is held by two or more persons in joint tenancy with right of survivorship or by a married couple as community property with right of survivorship, after the death of a co-owner of the transferable interest all of the following apply:

1. the surviving co-owner or co-owners of the transferable interest shall succeed to the ownership of the decedent’s interest in the transferable interest without further action by the limited liability company or the other members and shall have only the rights of a transferee with respect to the interest, unless and until the co-owner or co-owners are admitted as a member or members in accordance with subsection C of this Section.

2. the decedent’s interest in the hands of the surviving co-owner or co-owners shall continue to be subject to all obligations and liabilities to which that interest was subject immediately before the death under the terms of the operating agreement or other agreement among one or more members or third parties.

3. if there is more than one surviving co-owner of a transferable interest held in joint tenancy with right of survivorship, after the death of a co-owner the surviving co-owners shall continue to own the transferable interest in equal shares as joint tenants with right of survivorship.

J. The distribution, voting, approval and other management rights with respect to a transferable interest that is co-owned by two or more persons, whether the transferable interest is held as tenants in common, joint tenants with right of survivorship, community property or community property with right of survivorship, shall be the same as if the interest were held by only one person.

K. Each co-owner of a transferable interest who becomes a member may exercise all voting, approval and other management rights of a member, including the right to approve an amendment to the operating agreement, with respect to an interest held as tenancy in common, joint tenancy with right of survivorship, community property or community property with right of survivorship.

L. The limited liability company is entitled to rely in good faith on the act of a member that purports to be taken in the exercise of any voting, approval or other management right, including the right to approve an amendment to the operating agreement relating to a transferable interest that is co-owned by the member with one or more other persons, whether the transferable interest is held as tenants in common, joint tenants with right of survivorship, community property or community property with right of survivorship.

M. If a co-owner of a transferable interest held as joint tenants with right of survivorship or community property with right of survivorship transfers part or all of the co-owner’s share of the transferable interest, the right of survivorship is extinguished and the co-owners of the transferable interest after the transfer hold their shares of the transferable interest as tenants in common. In the case of community property with right of survivorship, the right of survivorship is also extinguished as provided in Section 14-2803 or 14-2804 or on the delivery to the limited liability company, at its principal address, of an affidavit entitled “affidavit terminating right of survivorship” that is executed by either spouse under oath stating the spouse’s intent to terminate the right of survivorship and describing the affected transferable interest. the delivery of the affidavit does not extinguish the community property interest of either spouse.

N. A limited liability company is not required to give effect to any creation or extinguishment of a right of survivorship until the company has received written notice of the change in the form of ownership or of the creation or the extinguishment of a right of survivorship at its principal address.

O. With respect to a transferable interest owned in joint tenancy with right of survivorship, tenancy in common or community property with or without right of survivorship, if a charging order from a court of competent jurisdiction is obtained against a co-owner’s share of the transferable interest, it shall attach only to that co-owner’s share or portion of the transferable interest and not to the share or portion of the other co-owner or co-owners.

Note:  As of September 1, 2020, this statute applies to all Arizona LLCs .  The text above shows the statute as of August 2, 2021.  To see if the Arizona legislature modified this statute after August 2, 2021, go the the Arizona legislature's website for Title 29, Chapter 7.