2006 Code of Virginia § 13.1-1040.1 - Events causing member\'s dissociation

13.1-1040.1. Events causing member's dissociation.

Except as otherwise provided in the articles of organization or an operatingagreement, a member is dissociated from a limited liability company upon theoccurrence of any of the following events:

1. To the extent resignation of a member is provided for in writing in thearticles of organization or an operating agreement, the limited liabilitycompany's having notice of the member's express will to resign as a member ona later date specified by the member in the notice or, if no later date isspecified, the date of notice;

2. An event agreed to in the articles of organization or an operatingagreement as causing the member's dissociation;

3. The member's expulsion pursuant to the articles of organization or anoperating agreement;

4. The member's expulsion by the unanimous vote of the other members if:

a. It is unlawful to carry on the business of the limited liability companywith that member; or

b. There has been an assignment or transfer of all or substantially all ofthat member's membership interest, other than a transfer for securitypurposes or a court order charging the member's interest which, in eithercase has not been foreclosed;

5. On application by the limited liability company or another member, themember's expulsion by judicial determination because:

a. The member engaged in wrongful conduct that adversely and materiallyaffected the business of the limited liability company;

b. The member willfully or persistently committed a material breach of thearticles of organization or an operating agreement; or

c. The member engaged in conduct relating to the business of the limitedliability company which makes it not reasonably practicable to carry on thebusiness with the member;

6. The member's:

a. Becoming a debtor in bankruptcy;

b. Executing an assignment for the benefit of creditors;

c. Seeking, consenting to, or acquiescing in the appointment of a trustee,receiver, or liquidator of that member or of all or substantially all of thatmember's property; or

d. Failing, within ninety days after the appointment, to have vacated orstayed the appointment of a trustee, receiver, or liquidator of the member orof all or substantially all of the member's property obtained without themember's consent or acquiescence, or failing within ninety days after theexpiration of a stay to have the appointment vacated;

7. In the case of a member who is an individual:

a. The member's death;

b. The appointment of a guardian, committee or conservator for the member; or

c. A judicial determination that the member has otherwise become incapable ofperforming the member's duties under the articles of organization or anoperating agreement;

8. In the case of a member that is a trust or is acting as a member by virtueof being a trustee of a trust, distribution of the trust's entiretransferable interest in the limited liability company, but not merely byreason of the substitution of a successor trustee;

9. In the case of a member that is an estate or is acting as a member byvirtue of being a personal representative of an estate, distribution of theestate's entire transferable interest in the limited liability company, butnot merely by reason of the substitution of a successor personalrepresentative;

10. Termination of a member who is not an individual, partnership,corporation, limited liability company, trust, or estate;

11. The expiration of ninety days after the limited liability companynotifies a corporate member that it will be expelled because it has filedarticles of dissolution or the equivalent, its existence has been terminatedor its charter has been revoked, or its right to conduct business has beensuspended by the jurisdiction of its incorporation, if there is no revocationof the certificate of dissolution or no reinstatement of its existence, itscharter or its right to conduct business; or

12. A partnership or limited liability company that is a member has beendissolved and its business is being wound up.

(1998, c. 432; 2002, c. 288.)