                                 CODE OF VIRGINIA

CONVERSION INTO NONPROFESSIONAL COMPANY; DISPOSITION OF MEMBERSHIP INTERESTS OF
DECEASED OR DISQUALIFIED MEMBERS (§ 13.1-1117)

A. A professional limited liability company organized under this chapter shall
continue until dissolved in accordance with other provisions of this chapter or
the provisions of Article 9 (&#xA7; 13.1-1046 et seq.) of Chapter 12 of this
title.

B. Whenever all members of a professional limited liability company licensed
under this chapter cease at any one time and for any reason to be licensed,
certified or registered in the particular field of endeavor for which the
professional limited liability company was organized, or by the vote of the
holders of at least two-thirds of its membership interests, the professional
limited liability company thereupon shall be treated as converted into, and
shall operate henceforth solely as, a limited liability company under applicable
provisions of this title, exclusive of this chapter, but may be reconverted upon
removal of the disability or by the vote of the holders of at least two-thirds
of its membership interests.

C. Following the occurrence of any event that terminates the continued
membership of a member in a professional limited liability company, including a
disqualification that terminates a member&#8217;s membership as provided in
&#xA7; 13.1-1116, the limited liability company shall pay to the former member
or the former member&#8217;s successor in interest the value of the interest of
the former member. The time of payment and value of the interest of the former
member shall be determined in the manner provided in writing in the articles of
organization or an operating agreement of the limited liability company, and to
the extent not so provided in the articles of organization or an operating
agreement, the payment shall be made within one year following the occurrence of
the event that terminates the former member&#8217;s membership and for the book
value of the interest, determined as of the end of the month immediately
preceding the event that terminated the membership of the former member. If
applicable, the book value shall be determined from the books and records of the
limited liability company in accordance with the generally accepted accounting
principles on the accrual method of accounting. No subsequent adjustment of this
book value, whether by the limited liability company itself, by federal income
tax audit made and agreed to, or by a court decision which has become final,
shall alter the amount of the payment to be made.

D. An arrangement or provision in the articles of organization, operating
agreement or by contract may be made to transfer any membership interest held by
a disqualified charitable remainder trust to the professional limited liability
company or to persons qualified to hold such an interest under &#xA7; 13.1-1103,
whether made before or after the disqualification of a charitable remainder
trust, provided that the membership interest involved shall have been so
transferred within one year following such disqualification.

HISTORY: 1992, c. 574; 1995, c. 168; 1996, c. 265; 1999, c. 100; 2009, c. 763.