1. If any officer, stockholder, director, member, manager or employee of a professional entity organized under this chapter who has been rendering professional service to the public becomes legally disqualified to render such professional services within this State, he or she shall sever within a reasonable period all professional service with and financial interest in the professional entity, but this chapter does not prevent a professional entity formed under this chapter from entering into a contract with an employee which provides for severance pay or for compensation for past services upon termination of professional service, whether by death or otherwise.

2. Except as otherwise provided in NRS 623.349, a natural person may not be an officer, director or manager of a professional entity formed under this chapter unless the natural person is licensed to render the same specific professional services as those for which the professional entity was formed.

3. Upon the death of an owner of a professional entity who has transferred his or her interest in the professional entity to a revocable trust as permitted by NRS 89.070, the trustee of the revocable trust may continue to retain any interest so transferred for a reasonable period, but may not exercise any authority concerning the rendering of professional services and may not, except as otherwise provided in NRS 623.349, distribute the owner’s interest to any person not licensed to render the services for which the professional entity was formed.

4. A professional entity’s failure to require compliance with the provisions of this section is a ground for the forfeiture of its charter.

(Added to NRS by 1963, 866; A 1969, 522; 1991, 1307; 1995, 2119; 2001, 1783; 2007, 2437)