Virginia Code 13.1-1040.1: Events causing member’s dissociation.
Except as otherwise provided in the articles of organization or an operating agreement, a member is dissociated from a limited liability company upon the occurrence of any of the following events:
Terms Used In Virginia Code 13.1-1040.1
- Articles of organization: means all documents constituting, at any particular time, the articles of organization of a limited liability company. See Virginia Code 13.1-1002
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Distribution: means a direct or indirect transfer of money or other property, or incurrence of indebtedness by a limited liability company, to or for the benefit of its members in respect of their interests. See Virginia Code 13.1-1002
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- in writing: include any representation of words, letters, symbols, numbers, or figures, whether (i) printed or inscribed on a tangible medium or (ii) stored in an electronic or other medium and retrievable in a perceivable form and whether an electronic signature authorized by Virginia Code 1-257
- interest: means a member's share of the profits and the losses of the limited liability company and the right to receive distributions of the limited liability company's assets. See Virginia Code 13.1-1002
- Member: means a person that has been admitted to membership in a limited liability company as provided in § Virginia Code 13.1-1002
- Operating agreement: means an agreement of the members as to the affairs of a limited liability company and the conduct of its business, or a writing or agreement of a limited liability company with one member that satisfies the requirements of subdivision A 2 of § Virginia Code 13.1-1002
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Personal representative: includes the executor of a will or the administrator of the estate of a decedent, the administrator of such estate with the will annexed, the administrator of such estate unadministered by a former representative, whether there is a will or not, any person who is under the order of a circuit court to take into his possession the estate of a decedent for administration, and every other curator of a decedent's estate, for or against whom suits may be brought for causes of action that accrued to or against the decedent. See Virginia Code 1-234
- Property: means all property, whether real, personal, or mixed or tangible or intangible, or any right or interest therein. See Virginia Code 13.1-1002
- Transfer: includes an assignment, a conveyance, a sale, a lease, an encumbrance including a mortgage or security interest, a gift, and a transfer by operation of law. See Virginia Code 13.1-1002
- Trustee: A person or institution holding and administering property in trust.
1. To the extent resignation of a member is provided for in writing in the articles of organization or an operating agreement, the limited liability company’s having notice of the member’s express will to resign as a member on a later date specified by the member in the notice or, if no later date is specified, the date of notice;
2. An event agreed to in the articles of organization or an operating agreement as causing the member’s dissociation;
3. The member’s expulsion pursuant to the articles of organization or an operating 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 company with that member; or
b. There has been an assignment or transfer of all or substantially all of that member’s membership interest, other than a transfer for security purposes or a court order charging the member’s interest;
5. On application by the limited liability company or another member, the member’s expulsion by judicial determination because:
a. The member engaged in wrongful conduct that adversely and materially affected the business of the limited liability company;
b. The member willfully or persistently committed a material breach of the articles of organization or an operating agreement; or
c. The member engaged in conduct relating to the business of the limited liability company which makes it not reasonably practicable to carry on the business 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 that member’s property; or
d. Failing, within ninety days after the appointment, to have vacated or stayed the appointment of a trustee, receiver, or liquidator of the member or of all or substantially all of the member’s property obtained without the member’s consent or acquiescence, or failing within ninety days after the expiration 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 of performing the member’s duties under the articles of organization or an operating agreement;
8. In the case of a member that is a trust or is acting as a member by virtue of being a trustee of a trust, distribution of the trust’s entire transferable interest in the limited liability company, but not merely by reason of the substitution of a successor trustee;
9. In the case of a member that is an estate or is acting as a member by virtue of being a personal representative of an estate, distribution of the estate’s entire transferable interest in the limited liability company, but not merely by reason of the substitution of a successor personal representative;
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 company notifies a corporate member that it will be expelled because it has filed articles of dissolution or the equivalent, its existence has been terminated or its charter has been revoked, or its right to conduct business has been suspended by the jurisdiction of its incorporation, if there is no revocation of the certificate of dissolution or no reinstatement of its existence, its charter or its right to conduct business; or
12. A partnership or limited liability company that is a member has been dissolved and its business is being wound up.