HOUSE BILL 281

56th legislature - STATE OF NEW MEXICO - first session, 2023

INTRODUCED BY

Greg Nibert

AN ACT

RELATING TO BUSINESS; ENACTING THE REVISED UNIFORM LIMITED LIABILITY COMPANY ACT; REPEALING AND REENACTING A PROVISION OF LAW PERTAINING TO RESTATED ARTICLES OF INCORPORATION; MAKING TECHNICAL AND CONFORMING CHANGES TO THE BUSINESS CORPORATION ACT AND CHAPTER 47, ARTICLE 1 NMSA 1978; PROVIDING PENALTIES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

ARTICLE 1

GENERAL PROVISIONS

     SECTION 101. [NEW MATERIAL] SHORT TITLE.--Sections 101 through 1103 of this act may be cited as the "Revised Uniform Limited Liability Company Act".

     SECTION 102. [NEW MATERIAL] DEFINITIONS.--As used in the Revised Uniform Limited Liability Company Act, unless the text otherwise specifies:

          A. "address", when used to refer to the principal office or registered office of a limited liability company or foreign limited liability company or to the place of business of a registered agent, means:

                (1) if within a municipality, the street address; or

                (2) if outside a municipality, the highway number or rural route number and box number, if any, or, if none, the geographical location, using well-known landmarks;

          B. "certificate of organization" means the certificate required by Section 201 of the Revised Uniform Limited Liability Company Act and includes the certificate as amended or restated;

          C. "contribution", except when used in the phrase "right of contribution", means property or a benefit described in Section 402 of the Revised Uniform Limited Liability Company Act that is provided by a person to a limited liability company to become a member or in the person's capacity as a member;

          D. "court" means the district court, except that if a party asserts a claim, action or proceeding against the secretary of state or an appeal pursuant to the provisions of Section 39-3-1.1 NMSA 1978 from a decision or act of any kind by the secretary of state, "court" means the district court for the first judicial district;

          E. "debtor in bankruptcy" means a person that is the subject of:

                (1) an order for relief under Title 11 of the United States Code or a comparable order under a successor statute of general application; or

                (2) a comparable order under federal, state or foreign law governing insolvency;

          F. "distribution":

                (1) means a transfer of money or other property from a limited liability company to a person on account of a transferable interest or in the person's capacity as a member; and

                (2) includes:

                     (a) a redemption or other purchase by a limited liability company of a transferable interest; and

                     (b) a transfer to a member in return for the member's relinquishment of a right to participate as a member in the management or conduct of the company's activities and affairs or to have access to records or other information concerning the company's activities and affairs; but

                (3) excludes:

                     (a) reasonable compensation for present or past services; or

                     (b) payments made in the ordinary course of business under a bona fide retirement plan or other bona fide benefits program;

          G. "electronic" means relating to technology having electronic, digital, magnetic, wireless, optical, electromagnetic or similar capabilities;

          H. "foreign limited liability company" means an unincorporated entity that is formed under the law of a jurisdiction other than New Mexico and that would be a limited liability company if formed under the law of New Mexico;

          I. "jurisdiction", when used to refer to a political entity, means the United States, a state, a foreign country or a political subdivision of a foreign country;

          J. "jurisdiction of formation" means the jurisdiction whose law governs the internal affairs of an entity;

          K. "limited liability company", except when used in the phrase "foreign limited liability company" or when used in Article 10 of the Revised Uniform Limited Liability Company Act, means an entity formed under that act or an entity that becomes subject to that act under Article 10 or Section 110 of that act;

          L. "manager" means a person that, under the operating agreement of a manager-managed limited liability company, is responsible, alone or in concert with others, for performing the management functions stated in Subsection C of Section 407 of the Revised Uniform Limited Liability Company Act;

          M. "manager-managed limited liability company" means a limited liability company that qualifies under Subsection A of Section 407 of the Revised Uniform Limited Liability Company Act;

          N. "member" means a person that has become a member of a limited liability company under Section 401 of the Revised Uniform Limited Liability Company Act and that has not dissociated under Section 602 of that act;

          O. "member-managed limited liability company" means a limited liability company that is not a manager-managed limited liability company;

          P. "operating agreement" means the agreement, regardless of whether it is referred to as an operating agreement, and regardless of whether it is oral, in a record, implied or in any combination thereof, of all the members of a limited liability company, including a sole member, concerning the matters described in Subsection A of Section 110 of the Revised Uniform Limited Liability Company Act; "operating agreement" includes the agreement as amended or restated;

          Q. "organizer" means a person that acts under Section 201 of the Revised Uniform Limited Liability Company Act to form a limited liability company and that need not be nor become a member or manager of the company formed;

          R. "person" means an individual, a business corporation, a partnership including a limited liability partnership, a limited partnership including a limited liability limited partnership, a limited liability company, a general cooperative association, a statutory trust, a business trust, a common-law business trust, an estate, a trust, an association, a joint venture, a public corporation, a government, a governmental subdivision, agency or instrumentality or any other legal or commercial entity;

          S. "principal office" means the principal executive office of a limited liability company or foreign limited liability company, regardless of whether the office is located in New Mexico, unless the principal office in New Mexico is specified;

          T. "property" means all property, whether real, personal, a combination of real and personal, tangible or intangible, or any right or interest therein;

          U. "record", when used as a noun, means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in a perceivable form;

          V. "registered agent" means an agent of a limited liability company or foreign limited liability company that is authorized to receive service of any process, notice or demand required or permitted by law to be delivered to the company;

          W. "registered foreign limited liability company" means a foreign limited liability company that is registered to do business in New Mexico under a statement of registration filed by the secretary of state;

          X. "sign" means, with the present intent to authenticate or adopt a record, to:

                (1) execute or adopt a tangible symbol; or

                (2) attach to or logically associate with the record an electronic symbol, sound or process;

          Y. "state" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or a territory or insular possession subject to the jurisdiction of the United States;

          Z. "transfer" includes an assignment, a conveyance, a sale, a lease, an encumbrance, including a mortgage and a security interest, a gift and a transfer by operation of law;

          AA. "transferable interest" means the right, as initially owned by a person in the person's capacity as a member, to receive distributions from a limited liability company, regardless of whether the person remains a member or continues to own any part of the right; "transferable interest" applies to any fraction of the interest, regardless of who owns it; and

          BB. "transferee" means a person to which all or part of a transferable interest has been transferred, regardless of whether the transferor is a member, and includes a person that owns a transferable interest under Paragraph (3) of Subsection A of Section 603 of the Revised Uniform Limited Liability Company Act.

     SECTION 103. [NEW MATERIAL] KNOWLEDGE--NOTICE.--

          A. A person knows a fact when the person has actual knowledge of it.

          B. A person has notice of a fact when the person:

                (1) has reason to know the fact from all of the facts known to the person at the time in question; or

                (2) is deemed to have notice of the fact under Subsection D of this section.

          C. Subject to Subsection F of Section 210 of the Revised Uniform Limited Liability Company Act, a person notifies another person of a fact by taking steps reasonably required to inform the other person in ordinary course, regardless of whether those steps cause the other person to know the fact.

          D. A person that is not a member is deemed to have notice of a limited liability company's:

                (1) dissolution ninety days after a statement of dissolution under Subsection F of Section 702 of that act becomes effective;

                (2) cancellation ninety days after a notice of cancellation under Section 213 of that act becomes effective;

                (3) termination ninety days after a statement of termination under Subparagraph (f) of Paragraph (2) of Subsection B of Section 702 of that act becomes effective; and

                (4) participation in a merger, an interest exchange, a conversion or a domestication, ninety days after statements of merger, interest, exchange, conversion or domestication under Article 10 of that act become effective.

     SECTION 104. [NEW MATERIAL] GOVERNING LAW.--The law of New Mexico governs:

          A. the internal affairs of a limited liability company; and

          B. the liability of a member as member and a manager as manager for a debt, obligation or other liability of a limited liability company.

     SECTION 105. [NEW MATERIAL] OPERATING AGREEMENT--SCOPE, FUNCTION AND LIMITATIONS.--

          A. Except as otherwise provided in Subsections C and D of this section, the operating agreement governs:

                (1) relations among the members as members and between the members and the limited liability company;

                (2) the rights and duties under the Revised Uniform Limited Liability Company Act of a person in the capacity of manager;

                (3) the activities and affairs of the company and the conduct of those activities and affairs; and

                (4) the means and conditions for amending the operating agreement.

          B. To the extent that the operating agreement does not provide for a matter described in Subsection A of this section, the Revised Uniform Limited Liability Company Act governs the matter.

          C. An operating agreement shall not:

                (1) vary the law applicable under Section 104 of the Revised Uniform Limited Liability Company Act;

                (2) vary a limited liability company's capacity under Section 109 of that act to sue and be sued in its own name;

                (3) vary any requirement, procedure or other provision of that act pertaining to:

                     (a) registered agents; or

                     (b) the secretary of state, including provisions pertaining to records authorized or required to be delivered to the secretary of state for filing under that act;

                (4) vary the provisions of Section 204 of that act;

                (5) alter or eliminate the duty of loyalty or the duty of care, except as otherwise provided in Subsection D of this section;

                (6) eliminate the contractual obligation of good faith and fair dealing under Subsection D of Section 409 of that act, except that the operating agreement may prescribe the standards, if not manifestly unreasonable, by which the performance of the obligation is to be measured;

                (7) relieve or exonerate a person from liability for conduct involving bad faith, willful or intentional misconduct or a knowing violation of law;

                (8) unreasonably restrict the duties and rights under Section 410 of that act, except that the operating agreement may impose reasonable restrictions on the availability and use of information obtained under that section and may define appropriate remedies, including liquidated damages, for a breach of a reasonable restriction on use;

                (9) vary the causes of dissolution specified in Paragraph (4) of Subsection A of Section 701 of that act;

                (10) vary the requirement to wind up the company's activities and affairs as specified in Subsections A and E and Paragraph (1) of Subsection B of Section 702 of that act;

                (11) unreasonably restrict the right of a member to maintain an action under Article 8 of that act;

                (12) vary the provisions of Section 805 of that act, except that the operating agreement may provide that the company may not have a special litigation committee;

                (13) vary the right of a member to approve a merger under Subsection A of Section 1009 of that act, an interest exchange under Subsection A of Section 1015 of that act, a conversion under Subsection A of Section 1021 of that act or a domestication under Subsection A of Section 1027 of that act;

                (14) vary the required contents of a plan of merger under Subsection A of Section 1008 of that act, a plan of interest exchange under Subsection A of Section 1014 of that act, a plan of conversion under Subsection A of Section 1020 of that act or a plan of domestication under Subsection A of Section 1026 of that act; and

                (15) except as otherwise provided in Section 106 and Subsection B of Section 107 of that act, restrict the rights under that act of a person other than a member or manager.

          D. Subject to Paragraph (7) of Subsection C of this section, and without limiting other terms that may be included in an operating agreement, the operating agreement may:

                (1) specify the method by which a specific act or transaction that would otherwise violate the duty of loyalty may, after full disclosure of all material facts, be authorized or ratified by one or more disinterested and independent persons;

                (2) alter the prohibition in Paragraph (2) of Subsection A of Section 405 of the Revised Uniform Limited Liability Company Act so that the prohibition requires only that the company's total assets not be less than the sum of its total liabilities;

                (3) to the extent that the operating agreement of a member-managed limited liability company expressly relieves a member of a responsibility that the member otherwise would have under that act and imposes that responsibility on one or more other members, eliminate or limit a fiduciary duty of the member relieved of the responsibility that would have pertained to the responsibility; and

                (4) if not manifestly unreasonable:

                     (a) alter or eliminate the aspects of the duty of loyalty stated in Subsections B and I of Section 409 of that act;

                     (b) identify specific types or categories of activities that do not violate the duty of loyalty;

                     (c) alter the duty of care; however, the operating agreement shall not authorize conduct involving bad faith, willful or intentional misconduct or a knowing violation of law; and

                     (d) alter or eliminate any other fiduciary duty.

          E. The court shall decide as a matter of law whether a term of an operating agreement is manifestly unreasonable under Paragraph (6) of Subsection C or Paragraph (3) of Subsection D of this section. The court:

                (1) shall make its determination as of the time the challenged term became part of the operating agreement and by considering only circumstances existing at that time; and

                (2) may invalidate the term only if, in light of the purposes, activities and affairs of the limited liability company, it is readily apparent that:

                     (a) the objective of the term is unreasonable; or

                     (b) the term is an unreasonable means to achieve the term's objective.

     SECTION 106. [NEW MATERIAL] OPERATING AGREEMENT--EFFECT ON LIMITED LIABILITY COMPANY AND PERSON BECOMING MEMBER--PRE-FORMATION AGREEMENT.--

          A. A limited liability company is bound by and may enforce the operating agreement, regardless of whether the company has itself manifested assent to the operating agreement.

          B. A person that becomes a member of a limited liability company is deemed to assent to the operating agreement.

          C. Two or more persons intending to become the initial members of a limited liability company may make an agreement providing that, upon the formation of the company, the agreement will become the operating agreement. One person intending to become the initial member of a limited liability company may assent to terms providing that, upon the formation of the company, the terms will become the operating agreement.

     SECTION 107. [NEW MATERIAL] OPERATING AGREEMENT--EFFECT ON THIRD PARTIES AND RELATIONSHIP TO RECORDS EFFECTIVE ON BEHALF OF LIMITED LIABILITY COMPANY.--

          A. An operating agreement may specify that its amendment requires the approval of a person that is not a party to the agreement or the satisfaction of a condition. An amendment is ineffective if its adoption does not include the required approval or satisfy the specified condition.

          B. The obligations of a limited liability company and its members to a person in the person's capacity as a transferee or a person dissociated as a member are governed by the operating agreement. An amendment to the operating agreement made after a person becomes a transferee or is dissociated as a member:

                (1) is effective with regard to any debt, obligation or other liability of the limited liability company or its members to the person in the person's capacity as a transferee or person dissociated as a member; and

                (2) is not effective to the extent that the amendment imposes a new debt, obligation or other liability on the transferee or person dissociated as a member.

          C. If a record delivered by a limited liability company to the secretary of state for filing becomes effective and contains a provision that would be ineffective under Subsection C or Paragraph (3) of Subsection D of Section 105 of the Revised Uniform Limited Liability Company Act if contained in the operating agreement, the provision is ineffective in the record.

          D. Subject to Subsection C of this section, if a record delivered by a limited liability company to the secretary of state for filing becomes effective and conflicts with a provision of the operating agreement:

                (1) the agreement prevails as to members, persons dissociated as members, transferees and managers; and

                (2) the record prevails as to other persons to the extent that they reasonably rely on the record.

     SECTION 108. [NEW MATERIAL] NATURE, PURPOSE AND DURATION OF LIMITED LIABILITY COMPANY.--

          A. A limited liability company is an entity distinct from its member or members.

          B. A limited liability company may have any lawful purpose. If the purpose for which a limited liability company is organized makes it subject to the provisions of other laws, the limited liability company shall also be subject to the provisions of those laws.

          C. A limited liability company has perpetual duration.

     SECTION 109. [NEW MATERIAL] POWERS.--A limited liability company has the capacity to sue and be sued in its own name and the power to do all things necessary or convenient to carry on its activities and affairs.

     SECTION 110. [NEW MATERIAL] APPLICATION TO EXISTING RELATIONSHIPS.--

          A. The Revised Uniform Limited Liability Company Act governs only:

                (1) a limited liability company formed pursuant to the provisions of the Revised Uniform Limited Liability Company Act; and

                (2) except as otherwise provided in this section, a limited liability company formed pursuant to the provisions of the Limited Liability Company Act that:

                     (a) elects, in the manner provided in its operating agreement or by law for amending the operating agreement, to be subject to the provisions of the Revised Uniform Limited Liability Company Act; and

                     (b) delivers to the secretary of state for filing under Subsection G of Section 210 of the Revised Uniform Limited Liability Company Act a restated certificate of organization containing the information required by Section 201 of the Revised Uniform Limited Liability Company Act.

          B. Except as otherwise provided in this section, until a limited liability company formed pursuant to the provisions of the Limited Liability Company Act elects to be governed by the Revised Uniform Limited Liability Company Act, the company shall continue to be governed by the provisions of the Limited Liability Company Act.

          C. After July 1, 2024, Section 212 and Subsection B of Section 111 of the Revised Uniform Limited Liability Company Act apply to a limited liability company formed pursuant to the provisions of the Limited Liability Company Act.

          D. After July 1, 2024, the Revised Uniform Limited Liability Company Act governs a foreign limited liability company registered to do business in New Mexico pursuant to the provisions of the Limited Liability Company Act or the Revised Uniform Limited Liability Company Act.

     SECTION 111. [NEW MATERIAL] SUPPLEMENTAL AND OTHER PRINCIPLES OF LAW.--

          A. Unless displaced by particular provisions of the Revised Uniform Limited Liability Company Act, the principles of law and equity supplement that act.

          B. Section 55-9-408 and Subsections (d), (f) and (j) of Section 55-9-406 NMSA 1978 do not apply to a security interest in an ownership interest, however denominated and however arising, in a limited liability company.

     SECTION 112. [NEW MATERIAL] NAMES PERMITTED.--

          A. The name of a limited liability company and, if different, the name under which it proposes to do business in New Mexico shall be stated in its certificate of organization and shall contain the phrase "limited liability company" or "limited company" or the abbreviation "L.L.C.", "LLC", "L.C." or "LC". "Limited" may be abbreviated as "Ltd.", and "company" may be abbreviated as "Co.".

          B. Except as otherwise provided in Subsection D of this section, the name of a limited liability company, and the name under which a foreign limited liability company may register to do business in New Mexico, shall be distinguishable on the records of the secretary of state from the name:

                (1) of an existing person whose formation required the filing of a record by the secretary of state and that is not at the time administratively dissolved;

                (2) of a limited liability partnership whose statement of qualification is in effect;

                (3) under which a person is registered to do business in New Mexico by the filing of a record by the secretary of state;

                (4) reserved under Section 113 of the Revised Uniform Limited Liability Company Act or another law of New Mexico providing for the reservation of a name by the filing of a record by the secretary of state; and

                (5) registered under Section 114 of that act or another law of New Mexico providing for the registration of a name by the filing of a record by the secretary of state.

          C. If a person consents in a record to the use of its name and submits an undertaking in a form satisfactory to the secretary of state to change its name to a name that is distinguishable on the records of the secretary of state from any name in any category of names specified in Subsection B of this section, the name of the consenting person may be used by the person to which the consent was given.

          D. Except as otherwise provided in Subsection E of this section, in determining whether a name is the same as or not distinguishable on the records of the secretary of state from the name of another person, words, phrases or abbreviations indicating a type of person, such as "corporation", "corp.", "incorporated", "Inc.", "professional corporation", "P.C.", "PC", "professional association", "P.A.", "PA", "Limited", "Ltd.", "limited partnership", "L.P.", "LP", "limited liability partnership", "L.L.P.", "LLP", "registered limited liability partnership", "R.L.L.P.", "RLLP", "limited liability limited partnership", "L.L.L.P.", "LLLP", "registered limited liability limited partnership", "R.L.L.L.P.", "RLLLP", "limited liability company", "L.L.C." and "LLC", shall not be taken into account.

          E. A person may consent in a record to the use of a name that is not distinguishable on the records of the secretary of state from its name except for the addition of a word, phrase or abbreviation indicating the type of person as provided in Subsection D of this section. In such a case, the person need not change its name in accordance with Subsection B of this section.

          F. A limited liability company or foreign limited liability company may use a name that is not distinguishable from a name described in Paragraphs (1) through (5) of Subsection B of this section if the company delivers to the secretary of state a certified copy of a final judgment of the court establishing the right of the company to use the name in New Mexico.

     SECTION 113. [NEW MATERIAL] RESERVATION OF NAME.--

          A. A person may reserve the exclusive use of a name that complies with Section 112 of the Revised Uniform Limited Liability Company Act by delivering an application to the secretary of state for filing. The application shall state the name and address of the applicant and the name to be reserved. If the secretary of state finds that the name is available, the secretary of state shall reserve the name for the applicant's exclusive use for one hundred twenty days.

          B. The owner of a reserved name may transfer the reservation to another person by delivering to the secretary of state a signed notice in a record of the transfer that states the name and address of the person to which the reservation is being transferred.

     SECTION 114. [NEW MATERIAL] REGISTRATION OF NAME.--

          A. A foreign limited liability company not registered to do business in New Mexico under Article 9 of the Revised Uniform Limited Liability Company Act may register its name, or an alternate name adopted under Section 906 of that act, if the name complies with Section 212 of that act and is distinguishable on the records of the secretary of state from the names that are not available under Section 112 of that act.

          B. To register its name or an alternate name adopted under Section 906 of the Revised Uniform Limited Liability Company Act, a foreign limited liability company shall deliver to the secretary of state for filing an application stating the company's name, the jurisdiction and date of its formation and any alternate name adopted under Section 906 of that act. If the secretary of state finds that the name applied for is available, the secretary of state shall register the name for the applicant's exclusive use.

          C. The registration of a name under this section is effective for one year after the date of registration.

          D. A foreign limited liability company whose name registration is effective may renew the registration for successive one-year periods by delivering, not earlier than three months before the expiration of the registration, to the secretary of state for filing a renewal application that complies with this section. When filed, the renewal application renews the registration for a succeeding one-year period.

          E. A foreign limited liability company whose name registration is effective may register as a foreign limited liability company under the registered name or consent in a signed record to the use of that name by another person that is not an individual.

     SECTION 115. [NEW MATERIAL] REGISTERED OFFICE AND REGISTERED AGENT--CHANGE OF PRINCIPAL PLACE OF REGISTERED OFFICE, REGISTERED AGENT OR BUSINESS.--

          A. A limited liability company shall maintain in New Mexico:

                (1) a registered office, which may be the same as the limited liability company's principal office; and

                (2) a registered agent for service of process on the limited liability company that is either:

                     (a) an individual resident of New Mexico;

                     (b) a domestic corporation, limited liability company or partnership having a place of business in New Mexico that is the same as the registered office; or

                     (c) a foreign corporation, limited liability company or partnership authorized to do business in New Mexico whose place of business is the same as the registered office.

          B. A limited liability company may change its registered office or registered agent by delivering to the secretary of state a statement setting forth:

                (1) the name of the limited liability company;

                (2) the name of its current registered agent;

                (3) the address of its current registered office; and

                (4) if its current registered agent is to be changed:

                     (a) the name of its successor registered agent;

                     (b) the address of the successor registered agent's place of business;

                     (c) a statement that such address is the same as the current address of the limited liability company's current registered office or, if there is a concurrent change in the address of the registered office, as the new address of the registered office; and

                     (d) a statement of the successor registered agent that the agent accepts the appointment;

                (5) if the current address of the place of business of its current registered agent is to be changed, the new address of the place of business of the current registered agent and a statement that the new address is the same as the address of the limited liability company's registered office or, if there is a concurrent change in the address of the registered office, as the new address of the registered office; or

                (6) if the address of its current registered office is to be changed, the new address to which the current registered office is to be changed and a statement that the new address is the same as the address of the place of business of the current registered agent of the limited liability company or, if there is a concurrent change of the current registered agent, of the successor registered agent of the limited liability company.

          C. If a registered agent changes the address of the registered agent's business office, the registered agent may change the address of the registered office of any limited liability company for which the registered agent is the registered agent by notifying the limited liability company in writing of the change and signing, either manually or in facsimile, and delivering to the secretary of state for filing a statement that complies with this section but need not be responsive to Paragraph (4) of Subsection B of this section and recites that the company has been notified of the change.

          D. If the secretary of state finds that the statement conforms to this section, the secretary of state shall file the statement in the secretary of state's office and, upon such filing, the change of registered agent, change of address of the registered office or change of the registered agent's place of business shall become effective and fulfill any requirement that such change be reported to the secretary of state.

          E. A registered agent of a limited liability company may resign as registered agent by delivering a written notice, executed in duplicate, to the secretary of state, who shall deliver a copy of the notice to the limited liability company at its principal place of business as shown on the records of the secretary of state. The resigning registered agent's appointment terminates thirty days after receipt of the notice by the secretary of state or on the effective date of the appointment of a successor registered agent, whichever occurs first.

     SECTION 116. [NEW MATERIAL] SERVICE OF PROCESS.--A limited liability company or a foreign limited liability company, regardless of whether registered under the Uniform Revised Limited Partnership Act, shall be served with process in the manner prescribed by law and the New Mexico Rules of Civil Procedure.

     SECTION 117. [NEW MATERIAL] FILING, SERVICE AND COPYING FEES.--The secretary of state shall charge and collect, for:

          A. filing the original certificate of organization and issuing a certificate of organization, a fee of fifty dollars ($50.00);

          B. filing amended or restated statements or plans of merger, interest exchange, conversion or domestication or of abandonment of statements or plans, a fee of fifty dollars ($50.00);

          C. filing original plans or statements of merger, conversion, interest exchange or domestication or of abandonment of statements or plans, a fee of one hundred dollars ($100);

          D. filing statements of dissolution or revocation of dissolution, a fee of twenty-five dollars ($25.00);

          E. issuing a certificate of good standing, a certificate of registration or a certificate for any purpose not otherwise specified, a fee of twenty-five dollars ($25.00);

          F. furnishing written information on any limited liability company, a fee of twenty-five dollars ($25.00);

          G. providing any number of pages of documents or instruments pertaining to one limited liability company, a fee of ten dollars ($10.00); however, the secretary of state is required to furnish only one copy of each page at this fee;

          H. providing a certification of documents or instruments pertaining to a limited liability company, a fee of twenty-five dollars ($25.00);

          I. accepting an application for reservation of a name or for filing a notice of the transfer of any name reservation, a fee of twenty dollars ($20.00);

          J. filing a statement of change of address of registered office or registered agent, or both, a fee of twenty dollars ($20.00);

          K. filing an agent's statement of change of address of registered agent, a fee of twenty dollars ($20.00);

          L. issuing a registration to a foreign limited liability company, a fee of one hundred dollars ($100);

          M. filing an amendment of the registration of a foreign limited liability company, a fee of fifty dollars ($50.00);

          N. filing an application for termination of registration of a foreign limited liability company and issuing a certificate of termination, a fee of twenty-five dollars ($25.00);

          O. filing a triennial report, a statement of correction or any other report, statement, instrument or document not otherwise specified, a fee of twenty dollars ($20.00);

          P. accepting an application for registration of a name by a foreign limited liability company not registered as a foreign limited liability company pursuant to the provisions of the Limited Liability Company Act or the Revised Uniform Limited Liability Company Act, a fee of one hundred dollars ($100);

          Q. filing an amendment, renewal or transfer of a registration of a name by a foreign limited liability company not registered as a foreign limited liability company pursuant to the provisions of the Limited Liability Company Act or the Revised Uniform Limited Liability Company Act, a fee of fifty dollars ($50.00);

          R. filing an application for reinstatement and issuing a statement of reinstatement, a fee of twenty-five dollars ($25.00);

          S. any check that is dishonored upon presentation, a fee of twenty dollars ($20.00); and

          T. expedited service or any other service for which no fee is established by law, the fee established by the secretary of state by rule.

     SECTION 118. [NEW MATERIAL] DELIVERY OF RECORD.--Except as otherwise provided in the Revised Uniform Limited Liability Company Act, permissible means of delivery of a record include delivery by hand, mail, commercial delivery service and electronic transmission.

     SECTION 119. [NEW MATERIAL] RESERVATION OF POWER TO AMEND OR REPEAL.--The legislature may amend or repeal all or part of the Revised Uniform Limited Liability Company Act, and all limited liability companies and foreign limited liability companies subject to that act are governed by the amendment or repeal.

ARTICLE 2

FORMATION; CERTIFICATE OF ORGANIZATION AND OTHER FILINGS

     SECTION 201. [NEW MATERIAL] FORMATION OF LIMITED LIABILITY COMPANY--CERTIFICATE OF ORGANIZATION--FILING.--

          A. One or more persons may act as organizers to form a limited liability company by delivering to the secretary of state for filing a certificate of organization.

          B. A certificate of organization shall state:

                (1) the name, which shall comply with Section 112 of the Revised Uniform Limited Liability Company Act, of the limited liability company;

                (2) the address of the company's registered office and the name of the registered agent at that office; and

                (3) the address of the company's principal office.

          C. A certificate of organization may contain statements as to matters other than those required by Subsection B of this section, but those statements shall not vary or otherwise affect the provisions specified in Subsection C or D of Section 105 of the Revised Uniform Limited Liability Company Act in a manner inconsistent with those sections.

          D. The organizer or organizers of a limited liability company shall file with the secretary of state:

                (1) the signed original of the certificate of organization, together with a duplicate copy, which may be signed, photocopied or conformed;

                (2) the statement of the person appointed registered agent, accepting appointment as registered agent; and

                (3) any other documents required to be filed under the Revised Uniform Limited Liability Company Act.

          E. The secretary of state may accept a facsimile transmission for filing.

          F. If the secretary of state determines that the documents delivered for filing conform with the Revised Uniform Limited Liability Company Act, the secretary of state shall, when all required filing fees have been paid:

                (1) endorse on each signed original and duplicate copy the word "filed" and the date of its acceptance for filing;

                (2) retain a signed original in the files of the secretary of state; and

                (3) return each duplicate copy to the person who delivered it to the secretary of state or to that person's representative.

          G. A limited liability company is formed when the certificate of organization is filed with the secretary of state or at a delayed date specified in the certificate of organization, which date shall be not more than ninety days after the filing of the certificate of organization with the secretary of state, if there has been substantial compliance with the requirements of the Revised Uniform Limited Liability Company Act.

          H. Each copy of the certificate of organization stamped "filed" and marked with the filing date is conclusive evidence that there has been substantial compliance with all conditions required to be performed by the organizers and that the limited liability company has been legally organized and formed pursuant to the Revised Uniform Limited Liability Company Act.

     SECTION 202. [NEW MATERIAL] AMENDMENT OR RESTATEMENT OF CERTIFICATE OF ORGANIZATION.--

          A. A certificate of organization may be amended or restated at any time.

          B. To amend its certificate of organization, a limited liability company shall deliver to the secretary of state for filing an amendment stating:

                (1) the name of the company, which shall comply with Section 112 of the Revised Uniform Limited Liability Company Act;

                (2) the date of filing of its initial certificate; and

                (3) the text of the amendment.

          C. To restate its certificate of organization to consolidate all amendments into a single document, a limited liability company shall deliver to the secretary of state for filing a restatement, designated as a restatement in its heading. The restatement may include one or more new amendments. The restated certificate of organization shall be designated as such in the heading and shall state either in the heading or in an introductory paragraph the limited liability company's present name and, if it has been changed, all of its former names and the date of the filing of its initial certificate of organization or original articles of organization. The restated certificate of organization supersedes the initial certificate of organization or original articles of organization and all previous amendments and restatements.

          D. If the name of the limited liability company is to be changed or a member of a member-managed limited liability company or a manager of a manager-managed limited liability company knows that any information in a filed certificate of organization was inaccurate when the certificate was filed, the member or manager shall promptly:

                (1) cause the certificate to be amended; or

                (2) if appropriate, deliver to the secretary of state for filing a statement of change in accordance with Section 115 of the Revised Uniform Limited Liability Company Act or a statement of correction in accordance with Section 209 of that act.

     SECTION 203. [NEW MATERIAL] SIGNING OF RECORDS TO BE DELIVERED FOR FILING TO SECRETARY OF STATE.--

          A. A record delivered to the secretary of state for filing under the Revised Uniform Limited Liability Company Act shall be signed as follows:

                (1) except as otherwise provided in Paragraphs (2) and (3) of this subsection, a record signed by a limited liability company or a registered foreign limited liability company shall be signed by a person authorized by the company;

                (2) a limited liability company's initial certificate of organization shall be signed by at least one person acting as an organizer;

                (3) a record delivered on behalf of a dissolved limited liability company or a dissolved registered foreign limited liability company that has no member shall be signed by the person winding up the company's activities and affairs under Subsection C of Section 702 of that act or under similar provisions of the jurisdiction of formation of a dissolved registered foreign limited liability company or a person appointed under Subsection D of Section 702 of that act or under similar provisions of the jurisdiction of formation of a dissolved registered foreign limited liability company to wind up the activities and affairs; and

                (4) any other record delivered on behalf of a person to the secretary of state for filing shall be signed by that person.

          B. Any record delivered for filing under the Revised Uniform Limited Liability Company Act may be signed by an agent. When that act requires a particular individual to sign a record and the individual is deceased or incapacitated, the record may be signed by a legal representative of the individual.

          C. A person that signs a record as an agent or a legal representative affirms as a fact that the person is authorized to sign the record. A person signing a record delivered for filing shall state beneath or opposite the person's signature, the person's name and the capacity in which the person signs the record. Powers of attorney relating to the preparation, execution or filing of a document need not be shown to or filed with the secretary of state.

     SECTION 204. [NEW MATERIAL] SIGNING AND FILING PURSUANT TO JUDICIAL ORDER.--

          A. If a person required by the Revised Uniform Limited Liability Company Act to sign a record or deliver a record to the secretary of state for filing under that act does not do so, any other person that is aggrieved may petition the court to order:

                (1) the person to sign the record;

                (2) the person to deliver the record to the secretary of state for filing; or

                (3) the secretary of state to file the record unsigned.

          B. If a petitioner under Subsection A of this section is not the limited liability company or foreign limited liability company to which the record pertains, the petitioner shall make the company or foreign company a party to the action.

          C. A record filed under Paragraph (3) of Subsection A of this section is effective without being signed.

     SECTION 205. [NEW MATERIAL] LIABILITY FOR INACCURATE INFORMATION IN FILED RECORD.--

          A. If a record delivered to the secretary of state for filing under the Revised Uniform Limited Liability Company Act and filed by the secretary of state contains inaccurate information, a person that suffers a loss by reliance on the information may recover damages for the loss from:

                (1) a person that signed the record, or caused another to sign it on the person's behalf, and knew the information to be inaccurate at the time that the record was signed; and

                (2) subject to Subsection B of this section, a member of a member-managed limited liability company or a manager of a manager-managed limited liability company, if:

                     (a) the record was delivered for filing on behalf of the company; and

                     (b) the member or manager knew or had notice of the inaccuracy for a reasonably sufficient time before the information was relied upon so that, before the reliance, the member or manager reasonably could have: 1) effected an amendment under Section 202 of the Revised Uniform Limited Liability Company Act; 2) filed a petition under Section 204 of that act; or 3) delivered to the secretary of state for filing a statement of change under Section 115 of that act or a statement of correction under Section 209 of that act.

          B. To the extent that the operating agreement of a member-managed limited liability company expressly relieves a member of responsibility for maintaining the accuracy of information contained in records delivered on behalf of the company to the secretary of state for filing under the Revised Uniform Limited Liability Company Act and imposes that responsibility on one or more other members, the liability stated in Paragraph (2) of Subsection A of this section applies to those other members and not to the member that the operating agreement relieves of the responsibility.

          C. An individual who signs a record authorized or required to be filed under the Revised Uniform Limited Liability Company Act affirms under penalty of perjury that the information stated in the record is accurate.

     SECTION 206. [NEW MATERIAL] FILING REQUIREMENTS.--

          A. To be filed by the secretary of state under the Revised Uniform Limited Liability Company Act, a record shall be received by the secretary of state, comply with that act and:

                (1) have its filing required or permitted by that act;

                (2) be physically delivered in written form unless and to the extent that the secretary of state permits electronic delivery of records;

                (3) have its words in English and its numbers in Arabic or Roman numerals. However, the name of an entity need not be in English if written in English letters or Arabic or Roman numerals;

                (4) be signed by a person authorized or required by that act to sign the record; and

                (5) state the name and capacity, if any, of each individual who signed the record, either on behalf of the individual or the person authorized or required to sign it, but the record need not contain a seal, attestation, acknowledgment or verification.

          B. If a law other than the Revised Uniform Limited Liability Company Act prohibits the disclosure by the secretary of state of information contained in a record delivered to the secretary of state for filing, the secretary of state shall file the record if the record otherwise complies with the Revised Uniform Limited Liability Company Act. However, the secretary of state may redact the information whose disclosure is prohibited.

          C. When a record is delivered to the secretary of state for filing, a fee, tax, interest or penalty required to be paid under the Revised Uniform Limited Liability Company Act or other law shall be paid in a manner permitted by the secretary of state or required by that law.

          D. A record delivered in written form shall be accompanied by a copy, which may be signed, photocopied or conformed.

          E. The secretary of state may provide forms for filings that are required or permitted to be made by the Revised Uniform Limited Liability Company Act. However, except as otherwise provided in Subsection F of this section or unless otherwise specifically prescribed by other law, the use of such forms is not required.

          F. The secretary of state may require that a cover sheet for a filing be on a form prescribed by the secretary of state.

     SECTION 207. [NEW MATERIAL] EFFECTIVE DATE.--Except as otherwise provided in Paragraph (1) of Subsection C of Section 209 of the Revised Uniform Limited Liability Company Act, and subject to Subsection D of Section 209 of that act, a record filed under that act is effective:

          A. on the date of its filing by the secretary of state, as provided in Subsection B of Section 210 of that act; or

          B. at the specified delayed effective date, which shall not be more than ninety days after the date of filing.

     SECTION 208. [NEW MATERIAL] ELECTRONIC FILING AND CERTIFICATION OF DOCUMENTS--USE OF ELECTRONIC PAYMENT OF FEES.--

          A. The secretary of state may adopt rules permitting the electronic filing of documents, including original documents, and the certification of electronically filed documents when filing or certification is required or permitted under the Revised Uniform Limited Liability Company Act. The rules shall provide for the appropriate treatment of electronic filings for the purposes of satisfying requirements for original documents or copies and shall provide the requirements for signature with respect to electronic filings. If the secretary of state accepts the filing of a document by electronic transmission, the secretary of state may accept for filing a document containing a copy of a signature, however made.

          B. The secretary of state may accept, in lieu of cash or check, a credit or debit card or other means of payment specified in the secretary of state's rules as payment of a fee, civil penalty or other financial liability required by the Revised Uniform Limited Liability Company Act. The secretary of state shall determine the credit or debit cards or other means of payment that may be accepted for payment.

     SECTION 209. [NEW MATERIAL] CORRECTING FILED RECORD.--

          A. A person on whose behalf a filed record was delivered to the secretary of state for filing may correct the record if:

                (1) the record at the time of filing was inaccurate;

                (2) the record was defectively signed; or

                (3) the electronic transmission of the record to the secretary of state was defective.

          B. To correct a filed record, a person on whose behalf the record was delivered to the secretary of state shall deliver to the secretary of state for filing a statement of correction.

          C. A statement of correction shall:

                (1) not state a delayed effective date;

                (2) be signed by the person correcting the filed record;

                (3) identify the filed record to be corrected;

                (4) specify the inaccuracy or defect to be corrected; and

                (5) correct the inaccuracy or defect.

          D. A statement of correction is effective as of the effective date of the filed record that it corrects except as to persons relying on the uncorrected filed record and adversely affected by the correction. For those purposes and as to those persons, the statement of correction is effective when filed.

     SECTION 210. [NEW MATERIAL] DUTY OF SECRETARY OF STATE TO FILE--REVIEW OF REFUSAL TO FILE--APPEAL OF SECRETARY OF STATE DECISION--DELIVERY OF RECORD.--

          A. The secretary of state shall file a record that complies with the Revised Uniform Limited Liability Company Act and that is delivered to the secretary of state for filing in compliance with Sections 206 and 208 and other applicable provisions of that act. The duty of the secretary of state stated in this section is ministerial.

          B. When the secretary of state files a record, the secretary of state shall record it as filed on the date of its delivery. After filing a record, the secretary of state shall deliver to the person that submitted the record a copy of the record with an acknowledgment of the date of filing.

          C. If the secretary of state refuses to file a record, the secretary of state shall, within fifteen business days after the record is delivered:

                (1) return the record or notify the person that submitted the record of the refusal; and

                (2) provide a brief explanation in a record of the reason for the refusal.

          D. If the secretary of state refuses to file a record, the person that submitted the record may appeal the refusal pursuant to the provisions of Section 39-3-1.1 NMSA 1978.

          E. The filing of or refusal to file a record does not:

                (1) affect the validity or invalidity of the record in whole or in part; or

                (2) create a presumption that the information contained in the record is correct or incorrect.

          F. Except as otherwise required by Section 116 of the Revised Uniform Limited Liability Company Act or by law other than that act, the secretary of state may deliver any record to a person by delivering it:

                (1) in person to the person that submitted it;

                (2) to the person's address shown on the person's most recent triennial report or supplemental report filed with the secretary of state;

                (3) to the address of the person's registered agent;

                (4) to the principal office of the person; or

                (5) to another address that the person provides to the secretary of state for delivery.

          G. Delivery of a record to the secretary of state is effective only when it is received by the secretary of state.

          H. Delivery of a record to a limited liability company, a foreign limited liability company or a person other than the secretary of state is effective at the earliest of:

                (1) the date the person receives the record;

                (2) the date shown on the return receipt, if signed by the company, foreign company or other person; or

                (3) five days after the deposit of the record with the United States postal service, or with the commercial delivery service, if correctly addressed and with prepayment of sufficient postage or fees and charges.

     SECTION 211. [NEW MATERIAL] CERTIFICATE OF GOOD STANDING OR REGISTRATION.--

          A. The secretary of state may issue a certificate of good standing and compliance for a limited liability company or foreign limited liability company registered to do business in New Mexico. If the person requesting the issuance of any such certificate is the limited liability company that is the subject of the certificate, the secretary of state may require that all fees, taxes, interest and penalties due to the secretary of state at the time of the request be paid before such certificate is issued.

          B. Except as otherwise provided in Subsection C of this section, all certificates issued by the secretary of state in accordance with the provisions of the Revised Uniform Limited Liability Company Act and all copies of documents filed in the secretary of state's office in accordance with the provisions of the Revised Uniform Limited Liability Company Act, when certified by the secretary of state, shall be taken and received in all courts, public offices and official bodies as prima facie evidence of the facts therein stated, and may be filed and recorded with the respective county clerks. A certificate by the secretary of state under the secretary of state's seal as to the existence or nonexistence of the facts relating to limited liability companies or foreign limited liability companies shall be taken and received in all courts, public offices and official bodies as prima facie evidence of the existence or nonexistence of the facts therein stated.

          C. Subsection B of this section applies to certificates of organization, except that certificates of organization shall be taken as conclusive evidence of the facts described in Subsection H of Section 201 of the Revised Uniform Limited Liability Company Act.

          D. The secretary of state has the power and authority reasonably necessary to enable the secretary of state to administer the Revised Uniform Limited Liability Company Act efficiently and to perform the duties therein imposed upon the secretary of state.

          E. The secretary of state shall provide for the retention, storage and destruction of any document filed with the secretary of state.

     SECTION 212. [NEW MATERIAL] TRIENNIAL REPORT FOR SECRETARY OF STATE.--

          A. A limited liability company or registered foreign limited liability company shall deliver to the secretary of state for filing a triennial report that states:

                (1) the name of the company or foreign company;

                (2) the address of the principal office of the company or foreign company and the address of the principal office of the company or foreign company in New Mexico, if different;

                (3) the address of the registered office of the company or foreign company in New Mexico and the name of its registered agent at that office;

                (4) if the company or foreign company has officers, the names and addresses of its officers;

                (5) in the case of a company, its name, which shall comply with Section 112 of the Revised Uniform Limited Liability Company Act; and

                (6) in the case of a foreign company, its jurisdiction of formation and any alternate name adopted under Subsection A of Section 906 of the Revised Uniform Limited Liability Company Act.

          B. Information in the triennial report shall be current as of the date that the report is signed by the limited liability company or registered foreign limited liability company.

          C. The first triennial report shall be delivered to the secretary of state for filing by the end of the third calendar month that follows the date on which the limited liability company's certificate of organization became effective or the registered foreign limited liability company registered to do business in New Mexico. Each registered limited liability company and each foreign limited liability company shall deliver a subsequent triennial report to the secretary of state for filing every third year thereafter, during the calendar month in which the first report was filed. The secretary of state may provide by rule for the orderly transition over several years of the filing of first triennial reports for limited liability companies organized before July 1, 2024 and for registered foreign limited liability companies registered before July 1, 2024.

          D. If a triennial report does not contain the information required by this section, the secretary of state shall promptly notify the reporting limited liability company or registered foreign limited liability company of the deficiency in a record and return the report for correction. The corrected triennial report shall be delivered to the secretary of state for filing within thirty days after the secretary of state returns it for correction.

          E. A supplemental report shall be filed with the secretary of state within thirty days if, after filing a triennial report, there is a change in the information contained in that report.

     SECTION 213. [NEW MATERIAL] FAILURE TO FILE REPORTS--CANCELLATION OF CERTIFICATE OF ORGANIZATION OR REGISTRATION--NOTICE OF CANCELLATION--PENALTY.--

          A. A limited liability company that is required to file a triennial report and that fails to submit the report within the time prescribed for a reporting period shall incur a civil penalty of two hundred dollars ($200) in addition to the fee for filing the report. The civil penalty shall be paid upon filing the report. Sixty days after written notice of failure to file a report has been delivered to the limited liability company, the limited liability company may have its certificate of organization canceled by the secretary of state without further proceedings, unless the report is filed and all fees, taxes, interest and penalties due to the secretary of state are paid within that sixty-day period. The secretary of state shall file a notice of cancellation that shall state the effective date of cancellation and the grounds for cancellation, and the secretary of state shall deliver a copy of the notice to the limited liability company under Section 210 of the Revised Uniform Limited Liability Company Act. The members, managers or other persons acting for the limited liability company whose certificate of organization has been canceled shall not carry on any activities for the limited liability company except as necessary to wind up its affairs and liquidate its assets under Sections 702 and 704 through 707 of the Revised Uniform Limited Liability Company Act or to apply for reinstatement under Section 215 of that act and to seek judicial review of a denial of reinstatement under Section 216 of that act.

          B. A registered foreign limited liability company that is required to file a triennial report and that fails to submit the report within the time prescribed for a reporting period shall incur a civil penalty of two hundred dollars ($200) in addition to the fee for filing the report. The civil penalty shall be paid upon filing the report. Sixty days after written notice of failure to file a report has been delivered to the registered foreign limited liability company's address as shown in the last triennial report or supplemental report filed with the secretary of state, the registered foreign limited liability company may have its registration to do business in New Mexico canceled by the secretary of state without further proceedings, unless the report is filed and all fees, taxes, interest and penalties due to the secretary of state are paid within that sixty-day period. The secretary of state shall file a notice of cancellation that shall state the effective date of cancellation and the grounds for cancellation, and the secretary of state deliver a copy of the notice to the company under Section 210 of the Revised Uniform Limited Liability Company Act. The authority of the registered foreign limited liability company to do business in New Mexico ceases on the effective date of the cancellation. Nothing in this section authorizes a forfeiture of the right or privilege of engaging in interstate commerce.

          C. A limited liability company or registered foreign limited liability company that fails to submit the required report within the time prescribed for filing the supplemental report shall incur a civil penalty of two hundred dollars ($200) in addition to the fee for filing the report. The civil penalty shall be paid upon filing the report.

     SECTION 214. [NEW MATERIAL] CANCELED LIMITED LIABILITY COMPANIES STRICKEN FROM SECRETARY OF STATE FILES.--A limited liability company whose certificate of organization has been canceled by the secretary of state under Section 213 of the Revised Uniform Limited Liability Company Act shall be stricken from the files of the secretary of state without further proceedings. A registered foreign limited liability company whose registration to do business in New Mexico has been canceled by the secretary of state under that section shall be stricken from the files of the secretary of state without further proceedings. A limited liability company whose certificate of organization has been canceled and that has been stricken from the files of the secretary of state may seek reinstatement under Section 215 of the Revised Uniform Limited Liability Company Act and judicial review of a denial of reinstatement under Section 216 of the Revised Uniform Limited Liability Company Act. A registered foreign limited liability company whose registration to do business in New Mexico has been canceled and that has been stricken from the files of the secretary of state may seek reinstatement pursuant to Section 911 of the Revised Uniform Limited Liability Company Act and judicial review of a denial of reinstatement pursuant to Section 912 of the Revised Uniform Limited Liability Company Act.

     SECTION 215. [NEW MATERIAL] REINSTATEMENT.--

          A. A limited liability company whose certificate of organization is canceled and that is stricken from the files of the secretary of state under Section 214 of the Revised Uniform Limited Liability Company Act may apply to the secretary of state for reinstatement within two years after the effective date of the striking of the company from the secretary of state's files. The application shall state:

                (1) the name of the company at the time of the striking of the company from the secretary of state's files;

                (2) the address of the principal office of the company;

                (3) the address of its registered office and the name of its registered agent at that office;

                (4) the effective date of the striking of the company from the secretary of state's files; and

                (5) that the grounds for striking of the company from the secretary of state's files did not exist or have been cured.

          B. To be reinstated, a limited liability company shall:

                (1) pay all fees, taxes, interest and penalties that were due to the secretary of state at the time of the striking of the company from the secretary of state's files and all fees, taxes, interest and penalties that would have been due to the secretary of state while the company was stricken from the files of the secretary of state; and

                (2) file with its application for reinstatement:

                     (i) a statement from the person appointed registered agent accepting appointment as registered agent;

                     (ii) proof that the grounds for striking the company from the secretary of state's records did not exist or have been cured; and

                     (iii) any other documents required to be filed under the Revised Uniform Limited Liability Company Act.

          C. If the secretary of state determines that an application under Subsection A of this section contains the required information, is reasonably satisfied that the information is correct, determines that the documents required to be filed under Subsection B of this section conform with the requirements of the Revised Uniform Limited Liability Company Act and determines that all payments required to be made to the secretary of state under Subsection B of this section have been made, the secretary of state shall:

                (1) cancel the cancellation of the limited liability company's certificate of organization and the striking of the company from the secretary's files and prepare a statement of reinstatement that states the secretary of state's determination of reinstatement and the effective date of reinstatement; and

                (2) file the statement of reinstatement and deliver a copy to the limited liability company.

          D. When reinstatement under this section is effective:

                (1) the reinstatement relates back to and takes effect as of the effective date of the cancellation of the limited liability company's certificate of organization and the striking of the company from the secretary of state's files;

                (2) the limited liability company resumes carrying on its activities and affairs as if the cancellation of the company's certificate of organization and the striking of the company from the secretary of state's files had not occurred; and

                (3) the rights of a person arising out of an act or omission in reliance on the cancellation of the limited liability company's certificate of organization and the striking of the company from the secretary of state's files before the person knew or had notice of the reinstatement are not affected.

     SECTION 216. [NEW MATERIAL] JUDICIAL REVIEW OF DENIAL OF REINSTATEMENT.--

          A. If the secretary of state denies a limited liability company's application for reinstatement following the cancellation of the company's certificate of organization and the striking of the company from the secretary's files, the secretary of state shall deliver to the company a notice that briefly explains the reasons for the denial.

          B. A limited liability company may appeal a denial of reinstatement pursuant to the provisions of Section 39-3-1.1 NMSA 1978.

ARTICLE 3

RELATIONS OF MEMBERS AND MANAGERS

TO PERSONS DEALING WITH LIMITED LIABILITY COMPANY

     SECTION 301. [NEW MATERIAL] NO AGENCY POWER OF MEMBER AS MEMBER.--

          A. A member is not an agent of a limited liability company solely by reason of being a member.

          B. A person's status as a member does not prevent or restrict a law other than the Revised Uniform Limited Liability Company Act from imposing liability on a limited liability company because of the person's conduct.

     SECTION 302. [NEW MATERIAL] LIABILITY OF MEMBERS AND MANAGERS.--

          A. A debt, obligation or other liability of a limited liability company is solely the debt, obligation or other liability of the company. A member or manager is not personally liable, directly or indirectly, by way of contribution or otherwise, for a debt, obligation or other liability of the company solely by reason of being or acting as a member or manager. This subsection applies regardless of the dissolution of the company.

          B. The failure of a limited liability company to observe formalities relating to the exercise of its powers or management of its activities and affairs is not a ground for imposing liability on a member or manager for a debt, an obligation or another liability of the company.

ARTICLE 4

RELATIONS OF MEMBERS TO EACH OTHER AND

TO LIMITED LIABILITY COMPANY

     SECTION 401. [NEW MATERIAL] BECOMING A MEMBER.--

          A. If a limited liability company is to have only one member upon formation, the person becomes a member as agreed by that person and the organizer of the company. That person and the organizer may, but need not, be different persons. If different, the organizer acts on behalf of the initial member.

          B. If a limited liability company is to have more than one member upon 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, but need not, be one of the persons.

          C. After formation of a limited liability company, a person becomes a member:

                (1) as provided in the operating agreement;

                (2) as the result of a transaction effective under Article 10 of the Revised Uniform Limited Liability Company Act;

                (3) with the affirmative vote or consent of all of the members; or

                (4) as provided in Paragraph (3) of Subsection A of Section 701 of that act.

          D. A person may become a member without:

                (1) acquiring a transferable interest; or

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

     SECTION 402. [NEW MATERIAL] FORM OF CONTRIBUTION.--A contribution may consist of property transferred to, services performed for or another benefit provided to the limited liability company or an agreement to transfer property to, perform services for or provide another benefit to the company.

     SECTION 403. [NEW MATERIAL] LIABILITY FOR CONTRIBUTIONS.--

          A. A person's obligation to make a contribution to a limited liability company is not excused by the person's death, disability, termination or other inability to perform personally.

          B. If a person does not fulfill an obligation to make a contribution other than money, the person is obligated at the option of the limited liability company to contribute money equal to the value of the part of the contribution that has not been made.

          C. The obligation of a person to make a contribution may be compromised only by the affirmative vote or consent of all of the members. If a creditor of a limited liability company extends credit or otherwise acts in reliance on an obligation described in Subsection A of this section without knowledge or notice of a compromise under this subsection, the creditor may enforce the obligation.

     SECTION 404. [NEW MATERIAL] SHARING OF AND RIGHT TO DISTRIBUTIONS BEFORE DISSOLUTION.--

          A. A distribution made by a limited liability company before its dissolution and winding up shall be in equal shares among members and persons dissociated as members, except to the extent necessary to comply with a transfer effective under Section 502 of the Revised Uniform Limited Liability Company Act or charging order in effect under Section 503 of that act.

          B. A person has a right to a distribution before the dissolution and winding up of a limited liability company only if the company decides to make an interim distribution. A person's dissociation does not entitle the person to a distribution.

          C. A person does not have a right to demand or receive a distribution from a limited liability company in a form other than money. Except as otherwise provided in Subsection D of Section 707 of the Revised Uniform Limited Liability Company Act, a company may distribute an asset in kind only if each part of the asset is fungible with each other part and each person receives a percentage of the asset equal in value to the person's share of distributions.

          D. If a member or transferee becomes entitled to receive a distribution, the member or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited liability company with respect to the distribution. However, the company's obligation to make a distribution is subject to offset for any amount owed to the company by the member or a person dissociated as a member on whose account the distribution is made.

     SECTION 405. [NEW MATERIAL] LIMITATIONS ON DISTRIBUTIONS.--

          A. A limited liability company shall not make a distribution, including a distribution under Section 707 of the Revised Uniform Limited Liability Company Act, if after the distribution:

                (1) the company would not be able to pay its debts as they become due in the ordinary course of the company's activities and affairs; or

                (2) the company's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the company were to be dissolved and wound up at the time of the distribution, to satisfy the preferential rights upon dissolution and winding up of members and transferees whose preferential rights are superior to the rights of persons receiving the distribution.

          B. A limited liability company may base a determination that a distribution is not prohibited under Subsection A of this section on:

                (1) financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances; or

                (2) a fair valuation or other method that is reasonable under the circumstances.

          C. Except as otherwise provided in Subsection E of this section, the effect of a distribution under Subsection A of this section is measured:

                (1) in the case of a distribution as defined in Paragraph (2) of Subsection F of Section 102 of the Revised Uniform Limited Liability Company Act, as of the earlier of the date that:

                     (a) money or other property is transferred or debt is incurred by the limited liability company; or

                     (b) the person entitled to the distribution ceases to own the interest or right being acquired by the company in return for the distribution;

                (2) in the case of any other distribution of indebtedness, as of the date the indebtedness is distributed; and

                (3) in all other cases, as of the date the:

                     (a) distribution is authorized, if the payment occurs within one hundred twenty days after that date; or

                     (b) payment is made, if the payment occurs more than one hundred twenty days after the distribution is authorized.

          D. A limited liability company's indebtedness to a member or transferee incurred by reason of a distribution made in accordance with this section is at parity with the company's indebtedness to its general, unsecured creditors, except to the extent that it is subordinated by agreement.

          E. A limited liability company's indebtedness, including indebtedness issued as a distribution, is not a liability for purposes of Subsection A of this section if the terms of the indebtedness provide that payment of principal and interest is made only if and to the extent that payment of a distribution could be made under this section. If the indebtedness is issued as a distribution, each payment of principal or interest is treated as a distribution, the effect of which is measured on the date the payment is made.

          F. In measuring the effect of a distribution under Section 707 of the Revised Uniform Limited Liability Company Act, the liabilities of a dissolved limited liability company do not include a claim that has been disposed of under Section 704, 705 or 706 of that act.

     SECTION 406. [NEW MATERIAL] LIABILITY FOR IMPROPER DISTRIBUTIONS.--

          A. Except as otherwise provided in Subsection B of this section, if a member of a member-managed limited liability company or manager of a manager-managed limited liability company consents to a distribution made in violation of Section 405 of the Revised Uniform Limited Liability Company Act and in consenting to the distribution fails to comply with Section 409 of that act, the member or manager is personally liable to the company for the amount of the distribution that exceeds the amount that could have been distributed without the violation of Section 405 of that act.

          B. To the extent that the operating agreement of a

member-managed limited liability company expressly relieves a member of the authority and responsibility to consent to distributions and imposes that authority and responsibility on one or more other members, the liability stated in Subsection A of this section applies to the other members and not the member that the operating agreement relieves of the authority and responsibility.

          C. A person that receives a distribution knowing that the distribution violated Section 405 of the Revised Uniform Limited Liability Company Act is personally liable to the limited liability company, but only to the extent that the distribution received by the person exceeded the amount that could have been properly paid under Section 405 of that act.

          D. A person against which an action is commenced because the person is liable under Subsection A of this section may:

                (1) implead any other person that is liable under that subsection and seek to enforce a right of contribution from the person; and

                (2) implead any person that received a distribution in violation of Subsection C of this section and seek to enforce a right of contribution from the person in the amount that the person received in violation of that subsection.

          E. An action under this section is barred unless it is commenced within six years after the distribution.

     SECTION 407. [NEW MATERIAL] MANAGEMENT OF LIMITED LIABILITY COMPANY.--

          A. A limited liability company is a member-managed limited liability company unless the operating agreement:

                (1) expressly provides that:

                     (a) the company is or will be "manager- managed";

                     (b) the company is or will be "managed by managers"; or

                     (c) management of the company is or will be "vested in managers"; or

                (2) includes words of similar import.

          B. In a member-managed limited liability company:

                (1) except as expressly provided in the Revised Uniform Limited Liability Company Act, the management and conduct of the company are vested in the members;

                (2) each member has equal rights in the management and conduct of the company's activities and affairs;

                (3) a difference arising among members as to a matter in the ordinary course of the activities and affairs of the company shall be decided by a majority of the members; and

                (4) the affirmative vote or consent of all the members is required to:

                     (a) undertake an act outside the ordinary course of the activities and affairs of the company; or

                     (b) amend the operating agreement.

          C. In a manager-managed limited liability company:

                (1) except as expressly provided in the Revised Uniform Limited Liability Company Act, any matter relating to the activities and affairs of the company is decided exclusively by the manager or, if there is more than one manager, by a majority of the managers;

                (2) each manager has equal rights in the management and conduct of the company's activities and affairs;

                (3) a difference arising among managers as to a matter in the ordinary course of the activities and affairs of the company shall be decided by a majority of the managers;

                (4) the affirmative vote or consent of all members is required to:

                     (a) undertake an act outside the ordinary course of the company's activities and affairs; or

                     (b) amend the operating agreement;

                (5) a manager may be chosen at any time by the affirmative vote or consent of a majority of the members and remains a manager until a successor has been chosen, unless the manager at an earlier time resigns, is removed, dies or, in the case of a manager that is not an individual, terminates. A manager may be removed, without notice or cause, at any time by the affirmative vote or consent of a majority of the members;

                (6) a person need not be a member to be a manager, but the dissociation of a member that is also a manager removes the person as a manager. If a person that is both a manager and a member ceases to be a manager, that cessation does not by itself dissociate the person as a member; and

                (7) a person's ceasing to be a manager does not discharge any debt, obligation or other liability to the limited liability company or members that the person incurred while a manager.

          D. An action requiring the vote or consent of members under the Revised Uniform Limited Liability Company Act may be taken without a meeting, and a member may appoint a proxy or other agent to vote, consent or otherwise act for the member by signing an appointing record, personally or by the member's agent.

          E. The dissolution of a limited liability company does not affect the applicability of this section. However, a person that wrongfully causes dissolution of the company loses the right to participate in management as a member and a manager.

          F. A limited liability company shall reimburse a member for an advance to the company beyond the amount of capital that the member agreed to contribute.

          G. A payment or advance made by a member that gives rise to an obligation of the limited liability company under Subsection F of this section or Subsection A of Section 408 of the Revised Uniform Limited Liability Company Act constitutes a loan to the company that accrues interest from the date of the payment or advance.

          H. A member is not entitled to remuneration for services performed for a member-managed limited liability company, except for reasonable compensation for services rendered in winding up the activities of the company.

          I. Unless otherwise restricted by the certificate of organization or operating agreement, managers of a limited liability company may participate in a meeting of the managers through remote communication by means of which all persons participating in the meeting can hear each other at the same time and participation through such communication shall constitute presence in person at a meeting.

          J. Unless otherwise restricted by the certificate of organization or operating agreement, members of a limited liability company may participate in a meeting of the members through remote communication by means of which all persons participating in the meeting can hear each other at the same time and participation through such communication shall constitute presence in person at a meeting.

     SECTION 408. [NEW MATERIAL] REIMBURSEMENT--INDEMNIFICATION--ADVANCEMENT--INSURANCE.--

          A. A limited liability company shall reimburse a member of a member-managed company or the manager of a manager-managed company for any payment made by the member or manager in the course of the member's or manager's activities on behalf of the company if the member or manager complied with Sections 405, 407 and 409 of the Revised Uniform Limited Liability Company Act in making the payment.

          B. A limited liability company shall indemnify and hold harmless a person with respect to any claim or demand against the person and any debt, obligation or other liability incurred by the person by reason of the person's former or present capacity as a member or manager, if the claim, demand, debt, obligation or other liability does not arise from the person's breach of Section 405, 407 or 409 of the Revised Uniform Limited Liability Company Act.

          C. In the ordinary course of its activities and affairs, a limited liability company may advance reasonable expenses, including attorney fees and costs, incurred by a person in connection with a claim or demand against the person by reason of the person's former or present capacity as a member or manager, if the person promises to repay the company if the person ultimately is determined not to be entitled to be indemnified as provided in Subsection B of this section.

          D. A limited liability company may purchase and maintain insurance on behalf of a member or manager against liability asserted against or incurred by the member or manager in that capacity or arising from that status even if, under Paragraph (7) of Subsection C of Section 105 of the Revised Uniform Limited Liability Company Act, the operating agreement could not eliminate or limit the person's liability to the company for the conduct giving rise to the liability.

     SECTION 409. [NEW MATERIAL] STANDARDS OF CONDUCT FOR MEMBERS AND MANAGERS.--

          A. A member of a member-managed limited liability company owes to the company and, subject to Section 801 of the Revised Uniform Limited Liability Company Act, the other members the duties of loyalty and care stated in Subsections B and C of this section.

          B. The fiduciary duty of loyalty of a member in a member-managed limited liability company includes the duties to:

                (1) account to the company and hold as trustee for it any property, profit or benefit derived by the member:

                     (a) in the conduct or winding up of the company's activities and affairs;

                     (b) from a use by the member of the company's property; or

                     (c) from the appropriation of a company opportunity;

                (2) refrain from dealing with the company in the conduct or winding up of the company's activities and affairs as or on behalf of a person having an interest adverse to the company; and

                (3) refrain from competing with the company in the conduct of the company's activities and affairs before the dissolution of the company.

          C. The duty of care of a member of a member-managed limited liability company in the conduct or winding up of the company's activities and affairs is to refrain from engaging in:

                (1) grossly negligent or reckless conduct;

                (2) willful or intentional misconduct; and

                (3) knowing violation of law.

          D. A member shall discharge the duties and obligations under the Revised Uniform Limited Liability Company Act or the operating agreement and exercise any rights consistently with the contractual obligation of good faith and fair dealing.

          E. A member does not violate a duty or obligation under the Revised Uniform Limited Liability Company Act or the operating agreement solely because the member's conduct furthers the member's own interest.

          F. All the members of a member-managed limited liability company or a manager-managed limited liability company may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.

          G. It is a defense to a claim under Paragraph (2) of Subsection B of this section and any comparable claim in equity or at common law that the transaction was fair to the limited liability company.

          H. If, as permitted by Subsection F or Paragraph (6) of Subsection I of this section or the operating agreement, a member enters into a transaction with the limited liability company that otherwise would be prohibited by Paragraph (2) of Subsection B of this section, then the member's rights and obligations arising from the transaction are the same as those of a person that is not a member.

          I. In a manager-managed limited liability company:

                (1) Subsections A, B, C and G of this section apply to the manager or managers and not the members;

                (2) the duty under Paragraph (3) of Subsection B of this section continues until winding up is completed;

                (3) Subsection D of this section applies to managers and members;

                (4) Subsection E of this section applies only to members;

                (5) the power to ratify under Subsection F of this section applies only to the members; and

                (6) subject to Subsection D of this section, a member does not have a duty to the company or to any other member solely by reason of being a member.

     SECTION 410. [NEW MATERIAL] RIGHTS TO INFORMATION OF MEMBER, MANAGER AND PERSON DISSOCIATED AS MEMBER.--

          A. In a member-managed limited liability company:

                (1) on reasonable notice, a member may inspect and copy during regular business hours, at a reasonable location specified by the company, any record maintained by the company regarding the company's activities, affairs, financial condition and other circumstances, to the extent that the information is material to the member's rights and duties under the operating agreement or the Revised Uniform Limited Liability Company Act;

                (2) the company shall furnish to each member:

                     (a) without demand, any information concerning the company's activities, affairs, financial condition and other circumstances that the company knows and is material to the proper exercise of the member's rights and duties under the operating agreement or the Revised Uniform Limited Liability Company Act, except to the extent that the company can establish that it reasonably believes the member already knows the information; and

                     (b) on demand, any other information concerning the company's activities, affairs, financial condition and other circumstances, except to the extent that the demand for the information demanded is unreasonable or otherwise improper under the circumstances; and

                (3) the duty to furnish information under Paragraph (2) of this subsection also applies to each member to the extent that the member knows any of the information described in that paragraph.

          B. In a manager-managed limited liability company:

                (1) the informational rights stated in Subsection A of this section and the duty stated in Paragraph (3) of Subsection A of this section apply to the managers and not the members;

                (2) during regular business hours and at a reasonable location specified by the company, a member may inspect and copy information regarding the activities, affairs, financial condition and other circumstances of the company as is just and reasonable if:

                     (a) the member seeks the information for a purpose reasonably related to the member's interest as a member;

                     (b) the member makes a demand in a record received by the company, describing with reasonable particularity the information sought and the purpose for seeking the information; and

                     (c) the information sought is directly connected to the member's purpose;

                (3) within ten days after receiving a demand under Subparagraph (b) of Paragraph (2) of this subsection, the company shall in a record inform the member that made the demand of:

                     (a) what information the company will provide in response to the demand and the place and time that the company will provide the information; and

                     (b) the company's reasons for declining, if the company declines to provide any demanded information; and

                (4) whenever the Revised Uniform Limited Liability Company Act or an operating agreement provides for a member to vote on or give or withhold consent to a matter, before the vote is cast or consent is given or withheld, the company shall, without demand, provide the member with all information known to the company and material to the member's decision.

          C. Subject to Subsection H of this section, on ten days' demand made in a record received by a limited liability company, a person dissociated as a member may have access to the information to which the person was entitled while a member if:

                (1) the information pertains to the period during which the person was a member;

                (2) the person seeks the information in good faith; and

                (3) the person satisfies the requirements imposed on a member by Paragraph (2) of Subsection B of this section.

          D. A limited liability company shall respond to a demand made under Subsection C of this section in the manner provided in Paragraph (3) of Subsection B of this section.

          E. A limited liability company may charge a person that makes a demand under this section the reasonable costs of labor and material for copying.

          F. A member or person dissociated as a member may exercise the rights under this section through an agent or, in the case of an individual under legal disability, a legal representative. A restriction or condition imposed by the operating agreement or under Subsection H of this section applies both to the agent or legal representative and to the member or person dissociated as a member.

          G. Subject to Section 504 of the Revised Uniform Limited Liability Company Act, the rights stated in this section do not extend to a person as transferee.

          H. In addition to any restriction or condition stated in its operating agreement, a limited liability company, as a matter within the ordinary course of its activities and affairs, may impose reasonable restrictions and conditions on access to and use of information to be furnished under this section, including designating information confidential and imposing nondisclosure and safeguarding obligations on the recipient. In a dispute concerning the reasonableness of a restriction under this subsection, the company has the burden of proving reasonableness.

ARTICLE 5

TRANSFERABLE INTERESTS AND RIGHTS OF TRANSFEREES AND CREDITORS

     SECTION 501. [NEW MATERIAL] NATURE OF TRANSFERABLE INTEREST.--A transferable interest is personal property.

     SECTION 502. [NEW MATERIAL] TRANSFER OF TRANSFERABLE INTEREST.--

          A. A transfer, in whole or in part, of a transferable interest:

                (1) is permissible;

                (2) does not by itself cause a member's dissociation or a dissolution and winding up of the limited liability company's activities and affairs; and

                (3) subject to Section 504 of the Revised Uniform Limited Liability Company Act, does not entitle the transferee to:

                     (a) participate in the management or conduct of the company's activities and affairs; or

                     (b) except as otherwise provided in Subsection C of this section, have access to records or other information concerning the company's activities and affairs.

          B. A transferee has the right to receive, in accordance with the transfer, distributions to which the transferor would otherwise be entitled.

          C. In a dissolution and winding up of a limited liability company, a transferee is entitled to an account of the company's transactions only from the date of dissolution.

          D. A transferable interest may be evidenced by a certificate of the interest issued by a limited liability company in a record, and, subject to the provisions of this section, the interest represented by a certificate may be transferred by a transfer of the certificate.

          E. A limited liability company need not give effect to a transferee's rights under this section until the company knows or has notice of the transfer.

          F. A transfer of a transferable interest in violation of a restriction on transfer contained in the operating agreement is ineffective if the intended transferee has knowledge or notice of the restriction at the time of transfer.

          G. Except as otherwise provided in Paragraph (2) of Subsection D of Section 602 of the Revised Uniform Limited Liability Company Act, if a member transfers a transferable interest, the transferor retains the rights of a member other than the transferable interest transferred and retains all the duties and obligations of a member.

          H. If a member transfers a transferable interest to a person that becomes a member with respect to the transferred interest, the transferee is liable for the member's obligations under Sections 403 and 406 of the Revised Uniform Limited Liability Company Act known to the transferee when the transferee becomes a member.

     SECTION 503. [NEW MATERIAL] CHARGING ORDER.--

          A. On application by a judgment creditor of a member or transferee, a court may enter a charging order against the transferable interest of the judgment debtor for the unsatisfied amount of the judgment. A charging order constitutes a lien on a judgment debtor's transferable interest and requires the limited liability company to pay over to the person to which the charging order was issued any distribution that otherwise would be paid to the judgment debtor.

          B. To the extent necessary to effectuate the collection of distributions under a charging order in effect under Subsection A of this section, the court may appoint a receiver of the distributions subject to the charging order with the power to make all inquiries that the judgment debtor might have made.

          C. Upon a showing that distributions under a charging order will not pay the judgment debt within a reasonable time, the court may foreclose the lien and order the sale of the transferable interest. The purchaser at the foreclosure sale obtains only the transferable interest, does not thereby become a member and is subject to Section 502 of the Revised Uniform Limited Liability Company Act.

          D. At any time before foreclosure under Subsection C of this section, the member or transferee whose transferable interest is subject to a charging order issued under Subsection A of this section may extinguish the charging order by satisfying the judgment and filing a certified copy of the satisfaction with the court that issued the charging order.

          E. At any time before foreclosure under Subsection C of this section, a limited liability company or one or more members whose transferable interests are not subject to the charging order may pay to the judgment creditor the full amount due under the judgment and thereby succeed to the rights of the judgment creditor, including the charging order.

          F. The Revised Uniform Limited Liability Company Act does not deprive a member or transferee of the benefit of any exemption law applicable to the transferable interest of the member or transferee.

          G. This section provides the exclusive remedy by which a person seeking in the capacity of judgment creditor to enforce a judgment against a member or transferee may satisfy the judgment from the judgment debtor's transferable interest.

     SECTION 504. [NEW MATERIAL] POWER OF LEGAL REPRESENTATIVE OF DECEASED MEMBER.--If a member dies, the deceased member's legal representative may exercise:

          A. the rights of a transferee provided in Subsection C of Section 502 of the Revised Uniform Limited Liability Company Act; and

          B. for the purposes of settling the estate, the rights that the deceased member had under Section 410 of that act.

ARTICLE 6

DISSOCIATION

     SECTION 601. [NEW MATERIAL] POWER TO DISSOCIATE AS MEMBER--WRONGFUL DISSOCIATION.--

          A. A person may dissociate as a member at any time, rightfully or wrongfully, by withdrawing as a member by express will under Subsection A of Section 602 of the Revised Uniform Limited Liability Company Act.

          B. A person's dissociation as a member is wrongful only if the dissociation:

                (1) is in breach of an express provision of the operating agreement; or

                (2) occurs before the completion of the winding up of the limited liability company and:

                     (a) the person withdraws as a member by express will;

                     (b) the person is expelled as a member by judicial order under Subsection F of Section 602 of the Revised Uniform Limited Liability Company Act;

                     (c) the person is dissociated under Subsection H of Section 602 of that act; or

                     (d) in the case of a person that is not a trust other than a business trust, an estate or an individual, the person is expelled or otherwise dissociated as a member because it willfully dissolved or terminated.

          C. A person that wrongfully dissociates as a member is liable to the limited liability company and, subject to Section 801 of the Revised Uniform Limited Liability Company Act, to the other members for damages caused by the dissociation. The liability is in addition to any debt, obligation or other liability of the member to the company or the other members.

     SECTION 602. [NEW MATERIAL] EVENTS CAUSING DISSOCIATION.--A person is dissociated as a member when:

          A. the limited liability company knows or has notice of the person's express will to withdraw as a member, but if the person has specified a withdrawal date later than the date the company knew or had notice, on that later date;

          B. an event stated in the operating agreement as causing the person's dissociation occurs;

          C. the person is expelled as a member under the operating agreement;

          D. the person is expelled as a member by the affirmative vote or consent of all the other members if:

                (1) it is unlawful to carry on the limited liability company's activities and affairs with the person as a member;

                (2) there has been a transfer of all the person's transferable interest in the company other than a:

                     (a) transfer for security purposes; or

                     (b) charging order in effect under Section 503 of the Revised Uniform Limited Liability Company Act that has not been foreclosed;

                (3) the person is an entity and:

                     (a) the company notifies the person that the person will be expelled as a member because the person has filed a statement of dissolution or the equivalent, the person has been administratively dissolved, the person's charter or the equivalent has been revoked or the person's right to conduct business has been suspended by the person's jurisdiction of formation; and

                     (b) within ninety days after the notification: 1) the statement of dissolution or the equivalent has not been withdrawn, rescinded or revoked; 2) the person has not been reinstated; or 3) the person's charter or the equivalent or right to conduct business has not been reinstated; or

                (4) the person is an unincorporated entity that has been dissolved and whose activities and affairs are being wound up;

          E. on application by the limited liability company or a member in a direct action taken under Section 801 of the Revised Uniform Limited Liability Company Act, the person is expelled as a member by judicial order because the person:

                (1) has engaged or is engaging in wrongful conduct that has affected adversely and materially, or will affect adversely and materially, the company's activities and affairs;

                (2) has committed willfully or persistently, or is committing willfully and persistently, a material breach of the operating agreement or a duty or obligation under Section 409 of the Revised Uniform Limited Liability Company Act; or

                (3) has engaged in or is engaging in conduct relating to the company's activities and affairs that makes it not reasonably practicable to carry on the activities and affairs with the person as a member;

          F. in the case of an individual:

                (1) the individual dies; or

                (2) in a member-managed limited liability company:

                     (a) a guardian or general conservator for the individual is appointed; or

                     (b) a court orders that the individual has otherwise become incapable of performing the individual's duties as a member under the Revised Uniform Limited Liability Company Act or the operating agreement;

          G. in a member-managed limited liability company, the person:

                (1) becomes a debtor in bankruptcy;

                (2) signs an assignment for the benefit of creditors; or

                (3) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of the person or of all or substantially all the person's property;

          H. in the case of a person that is a testamentary or inter vivos trust or is acting as a member by virtue of being a trustee of such a trust, the trust's entire transferable interest in the limited liability company is distributed;

          I. in the case of a person that is an estate or is acting as a member by virtue of being a personal representative of an estate, the estate's entire transferable interest in the limited liability company is distributed;

          J. in the case of a person that is not an individual, the existence of the person terminates;

          K. the limited liability company participates in a merger under Article 10 of the Revised Uniform Limited Liability Company Act and:

                (1) the company is not the surviving entity; or

                (2) otherwise as a result of the merger, the person ceases to be a member;

          L. the limited liability company participates in an interest exchange under Article 10 of the Revised Uniform Limited Liability Company Act and, as a result of the interest exchange, the person ceases to be a member;

          M. the limited liability company participates in a conversion under Article 10 of the Revised Uniform Limited Liability Company Act;

          N. the limited liability company participates in a domestication under Article 10 of the Revised Uniform Limited Liability Company Act and, as a result of the domestication, the person ceases to be a member; or

          O. the limited liability company dissolves and completes winding up.

     SECTION 603. [NEW MATERIAL] EFFECT OF DISSOCIATION.--

          A. If a person is dissociated as a member:

                (1) the person's right to participate as a member in the management and conduct of the limited liability company's activities and affairs terminates;

                (2) the person's duties and obligations as a member under Section 409 of the Revised Uniform Limited Liability Company Act end with regard to matters arising and events occurring after the person's dissociation; and

                (3) subject to Section 504 and Article 10 of that act, a transferable interest owned by the person in the person's capacity as a member immediately before dissociation is owned by the person solely as a transferee.

          B. A person's dissociation as a member does not of itself discharge the person from debt, an obligation or another liability to the limited liability company or the other members that the person incurred while a member.

ARTICLE 7

DISSOLUTION AND WINDING UP

     SECTION 701. [NEW MATERIAL] EVENTS CAUSING DISSOLUTION.--

          A. A limited liability company is dissolved and its activities and affairs shall be wound up upon the occurrence of:

                (1) an event or circumstance that the operating agreement states causes dissolution;

                (2) the affirmative vote or consent of all the members;

                (3) the passage of ninety consecutive days during which the company has no members, unless before the end of the period:

                     (a) consent to admit at least one specified person as a member is given by transferees owning the rights to receive a majority of distributions as transferees at the time the consent is to be effective; and

                     (b) at least one person becomes a member in accordance with the consent;

                (4) on application by a member, the entry by the court of an order dissolving the company on the grounds that:

                     (a) the conduct of all or substantially all the company's activities and affairs is unlawful;

                     (b) it is not reasonably practicable to carry on the company's activities and affairs in conformity with the certificate of organization and the operating agreement; or

                     (c) the managers or those members in control of the company: 1) have acted, are acting or will act in a manner that is illegal or fraudulent; or 2) have acted or are acting in a manner that is oppressive and was, is or will be directly harmful to the applicant;

                (5) the signing and filing of a statement of administrative dissolution by the secretary of state under Section 708 of the Revised Uniform Limited Liability Company Act; or

                (6) the filing of a notice of cancellation by the secretary of state under Section 213 of the Revised Uniform Limited Liability Company Act.

          B. In a proceeding brought under Subparagraph (c) of Paragraph (4) of Subsection A of this section, the court may order a remedy other than dissolution.

     SECTION 702. [NEW MATERIAL] WINDING UP--STATEMENT OF DISSOLUTION.--

          A. A dissolved limited liability company shall wind up its activities and affairs and, except as otherwise provided in Section 703 of the Revised Uniform Limited Liability Company Act, the company continues after dissolution only for the purpose of winding up.

          B. In winding up its activities and affairs, a limited liability company:

                (1) shall discharge the company's debts, obligations and other liabilities, settle and close the company's activities and affairs and marshal and distribute the assets of the company; and

                (2) may:

                     (a) deliver to the secretary of state for filing a statement of dissolution stating the name of the company and that the company is dissolved;

                     (b) preserve the company activities, affairs and property as a going concern for a reasonable time;

                     (c) prosecute and defend actions and proceedings, whether civil, criminal or administrative;

                     (d) transfer the company's property;

                     (e) settle disputes by mediation or arbitration;

                     (f) deliver to the secretary of state for filing a statement of termination stating the name of the company and that the company is terminated; and

                     (g) perform other acts necessary or appropriate to the winding up.

          C. If a dissolved limited liability company has no members, the legal representative of the last person to have been a member may wind up the activities and affairs of the company. If the person does so, the person has the powers of a sole manager under Subsection C of Section 407 of the Revised Uniform Limited Liability Company Act and is deemed to be a manager under Subsection A of Section 304 of that act.

          D. If the legal representative under Subsection C of this section declines or fails to wind up the limited liability company's activities and affairs, a person may be appointed to do so by the consent of transferees owning a majority of the rights to receive distributions as transferees at the time the consent is to be effective. A person appointed under this subsection:

                (1) has the powers of a sole manager under Subsection C of Section 407 of the Revised Uniform Limited Liability Company Act and is deemed to be a manager for the purposes of Subsection A of Section 304 of that act; and

                (2) shall deliver promptly to the secretary of state for filing an amendment to the company's certificate of organization stating:

                     (a) the name, which shall comply with Section 112 of the Revised Uniform Limited Liability Company Act;

                     (b) the dates of filing of its certificate of authority and all amendments and restatements;

                     (c) that the company has no members;

                     (d) the name and address of the person; and

                     (e) that the person has been appointed under this subsection to wind up the company.

          E. The court may order judicial supervision of the winding up of a dissolved limited liability company, including the appointment of a person to wind up the company's activities and affairs:

                (1) on the application of a member, if the applicant establishes good cause;

                (2) on the application of a transferee, if:

                     (a) the company does not have any members;

                     (b) the legal representative of the last person to have been a member declines or fails to wind up the company's activities; and

                     (c) within a reasonable time following the dissolution, a person has not been appointed under Subsection C of this section; or

                (3) in connection with a proceeding under Paragraph (4) of Subsection A of Section 701 of the Revised Uniform Limited Liability Company Act.

          F. On the dissolution of a limited liability company, persons with authority pursuant to the provisions of Subsection A, B, C, D or E of this section to wind up its business and affairs shall sign and deliver, to the secretary of state for filing, a statement of dissolution.

          G. The statement of dissolution shall state:

                (1) the name of the limited liability company;

                (2) the dates of filing the statement of organization and all amendments and restatements to the statement of organization;

                (3) the event causing the dissolution;

                (4) the effective date, which shall be a date certain, of the statement of dissolution if the statement of dissolution is not to be effective on filing;

                (5) the name and address of each person who has the authority to act for the limited liability company in connection with the winding up of its business and affairs;

                (6) confirmation that the limited liability company has resigned as a registered agent or is not currently a registered agent for any entity registered in New Mexico;

                (7) whether a court proceeding has been filed in connection with the dissolution of the limited liability company pursuant to the provisions of Section 706 of the Revised Uniform Limited Liability Company Act; and

                (8) any other information persons signing the statement of dissolution choose to include.

          H. After the statement of dissolution has been filed, only a person named in the statement of dissolution as having authority to act for the limited liability company in connection with the winding up of its business and affairs shall have such authority, including the authority to bind the limited liability company, do business on its behalf, act as its agent and execute any instrument for it and in its name.

          I. A statement of dissolution that has been filed may be amended at any time and from time to time or revoked at any time and, unless an amendment or revocation states otherwise, it shall be effective upon delivery to the office of the secretary of state for filing.

     SECTION 703. [NEW MATERIAL] REVOKING DISSOLUTION.--

          A. Unless a statement of termination or notice of cancellation applicable to the limited liability company is effective, the court has entered an order dissolving the company under Paragraph (4) of Subsection A of Section 701 of the Revised Uniform Limited Liability Company Act or the secretary of state has dissolved the company under Section 708 of that act, a limited liability company may revoke its dissolution.

          B. Revoking dissolution under this section requires:

                (1) the affirmative vote or consent of each member; and

                (2) delivery to the secretary of state for filing a statement of revocation stating the name of the company and that dissolution has been rescinded under this section.

          C. If a limited liability company revokes its dissolution:

                (1) the company resumes carrying on its activities and affairs as if dissolution had never occurred;

                (2) subject to Paragraph (3) of this subsection, any liability incurred by the company after the dissolution and before the revocation is effective is determined as if dissolution had never occurred; and

                (3) the rights of a third party arising out of conduct in reliance on the dissolution before the third party knew or had notice of the revocation shall not be adversely affected.

     SECTION 704. [NEW MATERIAL] KNOWN CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY.--

          A. Except as otherwise provided in Subsection D of this section, a dissolved limited liability company may give notice of a known claim under Subsection B of this section, which has the effect provided in Subsection C of this section.

          B. A dissolved limited liability company shall notify its known claimants in writing of the dissolution. The notice shall:

                (1) specify the information required to be included in a claim;

                (2) state that a claim shall be in writing and provide an address to which the claim is to be sent;

                (3) state the deadline for receipt of a claim, which shall not be earlier than the later of one hundred twenty days after the date the statement of dissolution was delivered to the secretary of state for filing pursuant to the provisions of Section 702 of the Revised Uniform Limited Liability Company Act, or, if the dissolution was not effective on such delivery date, one hundred twenty days after the effective date stated in the statement of dissolution;

                (4) state that the claim will be barred if not received by the deadline; and

                (5) state the effective date that will apply to any rejection notice that the limited liability company may give upon receipt of any claim.

          C. A claim against a dissolved limited liability company is barred if the requirements of Subsection B of this section are met and:

                (1) the claim is not received by the specified deadline; or

                (2) if the claim is timely received but rejected by the company:

                     (a) the company delivers to the claimant a rejection notice in writing stating that the claim is rejected and will be barred unless the claimant commences an action against the company to enforce the claim within ninety days after the effective date of the rejection notice, which shall be stated in the notice; and

                     (b) the claimant does not commence the required action within the ninety days after the effective date of the rejection notice.

          D. This section does not apply to a claim based on an event occurring after the date of dissolution or a liability that on that date is contingent.

     SECTION 705. [NEW MATERIAL] OTHER CLAIMS AGAINST DISSOLVED LIMITED LIABILITY COMPANY.--

          A. A dissolved limited liability company may publish notice of its dissolution and request persons having claims against the company to present them in accordance with the notice.

          B. A notice under Subsection A of this section shall:

                (1) be published once in a newspaper of general circulation in the county in New Mexico in which the dissolved limited liability company's principal office in New Mexico is or was last located or, if the limited liability company has had no principal office in New Mexico, in the county in New Mexico in which the office of the company's registered agent is or was last located;

                (2) describe the information required to be contained in a claim, state that the claim must be in writing and provide an address to which the claim is to be sent; and

                (3) state that a claim against the company is barred unless an action to enforce the claim is commenced within three years after publication of the notice.

          C. If a dissolved limited liability company publishes a notice in accordance with Subsection B of this section and delivers to the secretary of state for filing a statement of dissolution under Section 702 of the Revised Uniform Limited Liability Company Act, the claim of each of the following claimants is barred unless the claimant commences an action to enforce the claim against the company within three years after the publication date of the notice:

                (1) a claimant that did not receive notice in a record under Subsection B or C of Section 704 of the Revised Uniform Limited Liability Company Act;

                (2) a claimant that received notice in a record that did not comply with Subsection B or C of Section 704 of the Revised Uniform Limited Liability Company Act;

                (3) a claimant whose claim was timely sent to the company but not acted on; and

                (4) a claimant whose claim is contingent at, or based on an event occurring after, the date of dissolution.

          D. A claim not barred under this section or Section 704 of the Revised Uniform Limited Liability Company Act may be enforced:

                (1) against a dissolved limited liability company, to the extent of its undistributed assets; and

                (2) except as otherwise provided in Section 706 of that act, if assets of the company have been distributed after dissolution, against a member or transferee to the extent of that person's proportionate share of the claim or of the fair market value company's assets distributed to the member or transferee after dissolution determined as of the times of the distributions, whichever is less. However, a person's total liability for all claims under this paragraph shall not exceed the total amount of assets distributed to the person after dissolution, determined as of the times of the distributions.

     SECTION 706. [NEW MATERIAL] COURT PROCEEDINGS.--

          A. A dissolved limited liability company that has published a notice under Section 705 of the Revised Uniform Limited Liability Company Act may file an application with the court in the county in New Mexico where the company's principal office in New Mexico is or was last located or, if the limited liability company has had no principal office in New Mexico, where the office of its registered agent is or was last located, for a determination of the amount and form of security to be provided for payment of claims that are reasonably expected to arise after the date of dissolution based on facts known to the company and:

                (1) at the time of application:

                     (a) are contingent; or

                     (b) have not been made known to the company; or

                (2) are based on an event occurring after the date of dissolution.

          B. Security is not required for any claim that is or is reasonably anticipated to be barred under Section 705 of the Revised Uniform Limited Liability Company Act.

          C. Within twenty days after the filing of an application under Subsection A of this section, the dissolved limited liability company shall give notice of the proceeding to each claimant holding a contingent claim known to the company.

          D. In a proceeding under this section, the court may appoint a guardian ad litem to represent all claimants whose identities are unknown. The reasonable fees and expenses of the guardian, including all reasonable expert witness fees, shall be paid by the dissolved limited liability company.

          E. A dissolved limited liability company that provides security in the amount and form ordered by the court under Subsection A of this section satisfies the company's obligations with respect to claims that are contingent, have not been made known to the company or are based on an event occurring after the date of dissolution, and such claims shall not be enforced against a member or transferee on account of assets received in liquidation.

     SECTION 707. [NEW MATERIAL] DISPOSITION OF ASSETS IN WINDING UP.--

          A. In winding up its activities and affairs, a limited liability company shall apply its assets to discharge its obligations to creditors, including members that are creditors.

          B. After a limited liability company complies with Subsection A of this section, any surplus shall be distributed in the following order, subject to any charging order in effect under Section 503 of the Revised Uniform Limited Liability Company Act:

                (1) to each person owning a transferable interest that reflects contributions made and not previously returned, an amount equal to the value of the unreturned contributions; and

                (2) among persons owning transferable interests, in proportion to their respective rights to share in distributions immediately before the dissolution of the company.

          C. If a limited liability company does not have sufficient surplus to comply with Paragraph (1) of Subsection B of this section, any surplus shall be distributed among the owners of transferable interests in proportion to the value of the respective unreturned contributions.

          D. All distributions made under Subsections B and C of this section shall be paid in money.

     SECTION 708. [NEW MATERIAL] ADMINISTRATIVE DISSOLUTION.--

          A. The secretary of state may commence a proceeding under Subsection B of this section to dissolve a limited liability company administratively if the company does not:

                (1) pay, within sixty days after it is due, a fee, tax, interest or penalty required to be paid to the secretary of state;

                (2) have a registered agent or registered office in New Mexico for thirty consecutive days; or

                (3) deliver to the secretary of state for filing a statement of change pursuant to Section 115 of the Revised Uniform Limited Liability Company Act within thirty days after a change has occurred in the address of its registered office in New Mexico or the name of its registered agent at that office.

          B. If the secretary of state determines that one or more grounds exist for administratively dissolving a limited liability company, the secretary of state shall deliver to the company a notice in a record of the secretary of state's determination.

          C. If, within sixty days after service of the notice under Subsection B of this section, a limited liability company does not cure or demonstrate to the satisfaction of the secretary of state the nonexistence of each ground determined by the secretary of state, the secretary of state shall administratively dissolve the company by signing a statement of administrative dissolution that recites the grounds for dissolution and the effective date of dissolution. The secretary of state shall file the statement and deliver a copy to the company in accordance with Section 210 of the Revised Uniform Limited Liability Company Act.

          D. A limited liability company that is administratively dissolved continues in existence as an entity but shall not carry on any activities except as necessary to wind up its activities and affairs and liquidate its assets under Sections 702 and 704 through 707 of the Revised Uniform Limited Liability Company Act or to apply for reinstatement under Section 709 of that act and to seek judicial review of a denial of reinstatement pursuant to Section 710 of that act.

          E. The administrative dissolution of a limited liability company does not terminate the authority of its registered agent.

          F. The powers and remedies of the secretary of state under this section are in addition to the powers and remedies of the secretary under Sections 213 and 214 of the Revised Uniform Limited Liability Company Act.

     SECTION 709. [NEW MATERIAL] REINSTATEMENT.--

          A. A limited liability company that is administratively dissolved under Section 708 of the Revised Uniform Limited Liability Company Act may apply to the secretary of state for reinstatement within two years after the effective date of dissolution. The application shall state:

                (1) the name of the company at the time of its administrative dissolution and, if needed, a different name that satisfies Section 112 of that act;

                (2) the address of the principal office of the company and the address of its registered office and the name of its registered agent at the address of the registered office;

                (3) the effective date of the company's administrative dissolution; and

                (4) that the grounds for dissolution or the striking of the company from the secretary of state's files did not exist or have been cured.

          B. To be reinstated, a limited liability company shall:

                (1) pay all fees, taxes, interest and penalties that were due to the secretary of state at the time of the company's administrative dissolution and all fees, taxes, interest and penalties that would have been due to the secretary of state while the company was administratively dissolved; and

                (2) file with its application for reinstatement:

                     (i) a statement from the person appointed registered agent accepting appointment as registered agent;

                     (ii) proof that the grounds for the dissolution did not exist or have been cured; and

                     (iii) any other documents required to be filed under the Revised Uniform Limited Liability Company Act.

          C. If the secretary of state determines that an application under Subsection A of this section contains the required information, is reasonably satisfied that the information is correct, determines that the documents required to be filed under Subsection B of this section conform with the requirements of the Revised Uniform Limited Liability Company Act and determines that all payments required to be made to the secretary of state under Subsection B of this section have been made, the secretary of state shall:

                (1) cancel the statement of administrative dissolution and prepare a statement of reinstatement that states the secretary of state's determination and the effective date of reinstatement; and

                (2) file the statement of reinstatement and deliver a copy to the limited liability company.

          D. When reinstatement under this section is effective:

                (1) the reinstatement relates back to and takes effect as of the effective date of the administrative dissolution;

                (2) the limited liability company resumes carrying on its activities and affairs as if the administrative dissolution had not occurred; and

                (3) the rights of a person arising out of an act or omission in reliance on the dissolution before the person knew or had notice of the reinstatement are not affected.

     SECTION 710. [NEW MATERIAL] JUDICIAL REVIEW OF DENIAL OF REINSTATEMENT.--

          A. If the secretary of state denies a limited liability company's application for reinstatement following administrative dissolution, the secretary of state shall deliver to the company a notice in a record that explains the reasons for the denial.

          B. A limited liability company may file an appeal of denial of reinstatement pursuant to the provisions of Section 39-3-1.1 NMSA 1978.

ARTICLE 8

ACTIONS BY MEMBERS

     SECTION 801. [NEW MATERIAL] DIRECT ACTION BY MEMBER.--

          A. Subject to Subsection B of this section, a member may maintain a direct action against another member, a manager or the limited liability company to enforce the member's rights and to protect the member's interests, including rights and interests under the operating agreement or the Revised Uniform Limited Liability Company Act or arising independently of the membership relationship.

          B. A member maintaining a direct action under this section shall plead and prove an actual or threatened injury that is not solely the result of an injury suffered or threatened to be suffered by the limited liability company.

     SECTION 802. [NEW MATERIAL] DERIVATIVE ACTION.--A member may maintain a derivative action to enforce a right of a limited liability company if:

          A. the member first makes a demand on the other members in a member-managed limited liability company, or the managers of a manager-managed limited liability company, requesting that they cause the company to bring an action to enforce the right, and the managers or other members do not bring the action within a reasonable time; or

          B. a demand made under Subsection A of this section would be futile.

     SECTION 803. [NEW MATERIAL] PROPER PLAINTIFF.--A derivative action to enforce a right of a limited liability company may be maintained only by a person that is a member at the time the action is commenced and:

          A. was a member when the conduct giving rise to the action occurred; or

          B. whose status as a member devolved on the person by operation of law or under the operating agreement from a person that was a member at the time of the conduct.

     SECTION 804. [NEW MATERIAL] PLEADING.--In a derivative action, the complaint shall state with particularity:

          A. the date and content of the plaintiff's demand and the response to the demand by the other members or managers; or

          B. why the demand should be excused as futile.

     SECTION 805. [NEW MATERIAL] DISMISSAL OR SETTLEMENT.--A derivative action on behalf of a limited liability company shall not be voluntarily dismissed or settled without the court's approval. If the court determines that a proposed dismissal or settlement will substantially affect the interests of members of the limited liability company, the court shall direct that reasonable notice be given to the members affected. The members shall be afforded an opportunity to be heard.

     SECTION 806. [NEW MATERIAL] PROCEEDS AND EXPENSES.--

          A. Except as otherwise provided in Subsection B of this section:

                (1) any proceeds or other benefits of a derivative action, whether by judgment, compromise or settlement, belong to the limited liability company and not to the plaintiff; and

                (2) if the plaintiff receives any proceeds, the plaintiff shall remit them immediately to the company.

          B. If a derivative action is successful in whole or in part, the court may award the plaintiff reasonable expenses, including reasonable attorney fees and costs, from the recovery of the limited liability company.

ARTICLE 9

FOREIGN LIMITED LIABILITY COMPANIES

     SECTION 901. [NEW MATERIAL] GOVERNING LAW.--

          A. The law of the jurisdiction of formation of a foreign limited liability company governs:

                (1) the internal affairs of the company;

                (2) the liability of a member as member and a manager as manager for a debt, obligation or other liability of the company; and

                (3) the liability of a series of the company.

          B. A foreign limited liability company is not precluded from registering to do business in New Mexico because of any difference between the law of its jurisdiction of formation and the law of New Mexico.

          C. Registration of a foreign limited liability company to do business in New Mexico does not authorize the foreign company to engage in any activities and affairs or exercise any power that a limited liability company may not engage in or exercise in New Mexico.

     SECTION 902. [NEW MATERIAL] REGISTRATION TO DO BUSINESS IN NEW MEXICO--PROVIDING PENALTIES.--

          A. A foreign limited liability company shall not do business in New Mexico until it registers with the secretary of state under Article 9 of the Revised Uniform Limited Liability Company Act.

          B. A foreign limited liability company doing business in New Mexico may not maintain an action or proceeding in New Mexico unless it is registered to do business in New Mexico.

          C. The failure of a foreign limited liability company to register to do business in New Mexico does not impair the validity of a contract or act of the company or preclude it from defending an action or proceeding in New Mexico.

          D. Subsections A and B of Section 901 of the Revised Uniform Limited Liability Company Act apply even if a foreign limited liability company fails to register under Article 9 of that act.

          E. A foreign limited liability company, by doing business in New Mexico without registration, appoints the secretary of state as its agent for service of process with respect to causes of action arising out of doing business in New Mexico.

          F. A foreign limited liability company that does business in New Mexico without a valid registration shall be liable to New Mexico in an amount equal to all fees, taxes and interest that would have been imposed by the Revised Uniform Limited Liability Company Act on that foreign limited liability company for the years or parts of years during which it did business in New Mexico without registration, had it obtained such registration, filed all reports required by that act and paid all penalties imposed by that act. The attorney general may bring proceedings to recover all amounts due New Mexico under the provisions of this section.

          G. A foreign limited liability company that does business in New Mexico without a valid registration shall be subject to a civil penalty not to exceed two hundred dollars ($200) per year or any part thereof during which business was done.

          H. The civil penalty provided for in Subsection G of this section may be recovered in an action brought by the attorney general. Upon a finding by the court that a foreign limited liability company or any of its members or managers have done business in New Mexico in violation of the Revised Uniform Limited Liability Company Act, the court shall issue, in addition to the imposition of a civil penalty, an injunction restraining further doing of business by the foreign limited liability company and the further exercise of any limited liability company's rights and privileges in New Mexico. The foreign limited liability company shall be enjoined from doing business in New Mexico until all civil penalties, plus any interest and court costs that the court may assess, have been paid and until the foreign limited liability company has otherwise complied with the provisions of the Revised Uniform Limited Liability Company Act.

          I. A member or manager of a foreign limited liability company is not liable for the debts and obligations of the limited liability company solely because such company did business in New Mexico without registration.

     SECTION 903. [NEW MATERIAL] FOREIGN LIMITED LIABILITY COMPANY REGISTRATION.--

          A. Before doing business in New Mexico, a foreign limited liability company shall register with the secretary of state by submitting an original signed application for registration as a foreign limited liability company, together with a copy, which may be a photocopy of the original after it was signed or a photocopy that is conformed to the original, executed by a person with authority to do so under the laws of the state or other jurisdiction of its organization and a certificate of good standing and compliance issued by the appropriate official of the state or jurisdiction under the laws of which the organization is organized, current within thirty days and that has not expired at time of receipt by the secretary of state. The application shall set forth:

                (1) the name of the foreign limited liability company and, if different, the name under which it proposes to do business in New Mexico, which shall comply with Subsection A of Section 906 of the Revised Uniform Limited Liability Company Act;

                (2) the state or other jurisdiction where the foreign limited liability company was organized and the date of its organization;

                (3) the name and address of a registered agent for service of process, which agent meets the requirements of Section 116 of the Revised Uniform Limited Liability Company Act, whose original, signed statement, together with a copy, which may be a photocopy of the original after it was signed or a photocopy that is conformed to the original, to the effect that such person accepts designation as the registered agent of the foreign limited liability company, shall be submitted with the application;

                (4) a statement that the secretary of state is appointed the agent of the foreign limited liability company for service of process if no agent has been appointed upon resignation of an already appointed registered agent or, if appointed, the agent's authority has been revoked or the agent cannot be found or served in the exercise of reasonable diligence;

                (5) the address of the office required to be maintained in the state or other jurisdiction of its organization by the laws of that state or jurisdiction or, if not so required, of the principal office of the foreign limited liability company; and

                (6) a statement that the foreign limited liability company is a foreign limited liability company as defined in Subsection H of Section 102 of the Revised Uniform Limited Liability Company Act.

          B. If the secretary of state determines that the application for registration from a foreign limited liability company conforms to the provisions of the Revised Uniform Limited Liability Company Act and all requisite fees have been paid, the secretary of state shall:

                (1) endorse on the signed original and each copy the word "filed" and the date of its acceptance for filing;

                (2) retain a signed original in the files of the secretary of state; and

                (3) return each copy to the person who delivered it to the secretary of state or to that person's representative.

          C. A foreign limited liability company may register with the secretary of state under any name, whether or not it is the name under which it is registered in the state or other jurisdiction of organization, as long as the name could be registered by a domestic limited liability company pursuant to Section 112 of the Revised Uniform Limited Liability Company Act.

     SECTION 904. [NEW MATERIAL] AMENDED CERTIFICATE OF REGISTRATION OF FOREIGN LIMITED LIABILITY COMPANY.--

          A. The application for registration of a foreign limited liability company may be amended by filing an amended certificate of registration with the secretary of state signed by a person with authority to do so under the laws of the state or other jurisdiction of its organization. The application for an amended certificate of registration shall set forth:

                (1) the name of the foreign limited liability company and, if different, the name under which it transacts business in New Mexico, which shall comply with Subsection A of Section 906 of the Revised Uniform Limited Liability Company Act;

                (2) the date the original application for registration was filed; and

                (3) the amendment to the application for registration.

          B. The application for registration may be amended in any way, so long as the application for registration as amended contains only provisions that, at the time of the amendment, may be lawfully contained in an application for registration.

          C. The requirements in respect to the form and contents of the application for amended certificate of registration, the manner of its execution, the filing of an original and copy with the secretary of state, the issuance of an amended certificate of registration and the effect thereof, shall be the same as in the case of an original application for a certificate of registration.

     SECTION 905. [NEW MATERIAL] ACTIVITIES NOT CONSTITUTING DOING BUSINESS.--

          A. Activities of a foreign limited liability company that do not constitute doing business in New Mexico under Article 9 of the Revised Uniform Limited Liability Company Act include:

                (1) maintaining, defending, mediating, arbitrating or settling an action or proceeding;

                (2) carrying on an activity concerning the company's internal affairs, including holding meetings of its members or managers;

                (3) maintaining accounts in financial institutions;

                (4) maintaining offices or agencies for the transfer, exchange and registration of securities of the company or maintaining trustees or depositories with respect to those securities;

                (5) selling through independent contractors;

                (6) soliciting or obtaining orders, whether by mail or through employees or agents or otherwise, if the orders require acceptance outside New Mexico before they become contracts;

                (7) creating as borrower or lender or acquiring indebtedness or mortgages or other security interests in real or personal property;

                (8) owning, without more, property;

                (9) investing in or acquiring, in transactions outside New Mexico, royalties and other nonoperating mineral interests; executing division orders, contracts of sale and other instruments incidental to the ownership of such nonoperating mineral interests; and, in general, owning, without more, real or personal property;

                (10) conducting an isolated transaction that is completed within thirty days and that is not one in the course of repeated transactions of a like nature; and

                (11) doing business in interstate commerce.

          B. A foreign limited liability company shall not be considered to be doing business in New Mexico solely because it:

                (1) owns a controlling interest in a corporation or a foreign corporation that does business in New Mexico;

                (2) is a limited partner of a limited partnership or foreign limited partnership that is doing business in New Mexico; or

                (3) is a member or manager of a limited liability company or foreign limited liability company that is doing business in New Mexico.

          C. This section does not apply in determining the contacts or activities that may subject a foreign limited liability company to service of process, taxation or regulation under the law of New Mexico other than the Revised Uniform Limited Liability Company Act.

     SECTION 906. [NEW MATERIAL] NONCOMPLYING NAME OF FOREIGN LIMITED LIABILITY COMPANY.--

          A. A foreign limited liability company whose name does not comply with Section 112 of the Revised Uniform Limited Liability Company Act shall not register to do business in New Mexico until it adopts, for the purpose of doing business in New Mexico, an alternate name that complies with that section.           B. If a registered foreign limited liability company changes its name to one that does not comply with Section 112 of the Revised Uniform Limited Liability Company Act, it may not do business in New Mexico until it complies with Subsection A of this section by amending its registration to adopt an alternate name that complies with Section 112 of that act.

     SECTION 907. [NEW MATERIAL] WITHDRAWAL DEEMED ON CONVERSION TO DOMESTIC FILING ENTITY OR DOMESTIC LIMITED LIABILITY PARTNERSHIP.--A registered foreign limited liability company that converts to a domestic limited liability partnership or to a domestic entity whose formation requires delivery of a record to the secretary of state for filing is deemed to have withdrawn its registration on the effective date of the conversion.

     SECTION 908. [NEW MATERIAL] WITHDRAWAL ON DISSOLUTION OR CONVERSION TO NONFILING ENTITY OTHER THAN LIMITED LIABILITY PARTNERSHIP.--

          A. A registered foreign limited liability company that has dissolved and completed winding up or has converted to a domestic or foreign entity whose formation does not require the public filing of a record, other than a limited liability partnership, shall deliver a statement of withdrawal to the secretary of state for filing. The statement shall state, in the case of a company that has:

                (1) completed winding up:

                     (a) its name and jurisdiction of formation; and

                     (b) that the company surrenders its registration to do business in New Mexico; and

                (2) converted:

                     (a) the name of the converting company and its jurisdiction of formation;

                     (b) the type of entity to which the company has converted and its jurisdiction of formation;

                     (c) that the converted entity surrenders the converting company's registration to do business in New Mexico and revokes the authority of the converting company's registered agent to act as registered agent in New Mexico on behalf of the company or the converted entity; and

                     (d) an address to which service of process may be made under Subsection B of this section.

          B. After a withdrawal under this section is effective, service of process in an action or proceeding based on a cause of action arising during the time that the foreign limited liability company was registered to do business in New Mexico may be made under Section 116 of the Revised Uniform Limited Liability Company Act.

     SECTION 909. [NEW MATERIAL] TRANSFER OF REGISTRATION.--

          A. When a registered foreign limited liability company has merged into a foreign entity that is not registered to do business in New Mexico or has converted to a foreign entity required to register with the secretary of state to do business in New Mexico, the foreign entity shall deliver to the secretary of state for filing an application for transfer of registration. The application shall state:

                (1) the name of the registered foreign limited liability company before the merger or conversion;

                (2) that, before the merger or conversion, the registration pertained to a foreign limited liability company;

                (3) the name of the applicant foreign entity into which the foreign limited liability company has merged or to which it has been converted and, if the name does not comply with Section 112 of the Revised Uniform Limited Liability Company Act, an alternate name adopted under Subsection A of Section 906 of that act;

                (4) the type of entity of the applicant foreign entity and its jurisdiction of formation;

                (5) the address of the principal office of the applicant foreign entity and, if the law of the entity's jurisdiction of formation requires the entity to maintain an office in that jurisdiction, the address of that office; and

                (6) the name and address of the applicant foreign entity's registered agent in New Mexico.

          B. When an application for transfer of registration takes effect, the registration of the foreign limited liability company to do business in New Mexico is transferred without interruption to the foreign entity into which the company has merged or to which it has been converted.

     SECTION 910. [NEW MATERIAL] CANCELLATION OF REGISTRATION.--

          A. The secretary of state may cancel the registration of a registered foreign limited liability company in the manner provided in Subsections B and C of this section if the company does not:

                (1) pay, within sixty days after the due date, any fee, tax, interest or penalty required to be paid to the secretary of state under the Revised Uniform Limited Liability Company Act or a law other than that act;

                (2) have a registered agent as required by Section 115 of that act for thirty consecutive days; or

                (3) deliver to the secretary of state for filing a statement of a change under Section 115 of that act within thirty days after a change has occurred in the address of the company's registered office or the name of the registered agent at that address.

          B. The secretary of state may cancel the registration of a registered foreign limited liability company by:

                (1) filing a notice of cancellation or noting the cancellation in the records of the secretary of state; and

                (2) delivering a copy of the notice or the information in the notation to the company under Section 210 of the Revised Uniform Limited Liability Company Act.

          C. The notice shall state, or the information in the notation shall include:

                (1) the effective date of the cancellation, which shall be at least sixty days after the date that the secretary of state delivers the copy; and

                (2) the grounds for cancellation under Subsection A of this section.

          D. The authority of a registered foreign limited liability company to do business in New Mexico ceases on the effective date of the notice of cancellation or notation under Subsection B of this section, unless before that date the company cures each ground for cancellation stated in the notice or notation and provides proof of the cure in a record delivered to the secretary of state. If the company cures each ground to the reasonable satisfaction of the secretary of state, the secretary of state shall file a record so stating and shall deliver a copy of the record to the foreign limited liability company.

     SECTION 911. [NEW MATERIAL] REINSTATEMENT.--

          A. A foreign limited liability company whose registration to do business in New Mexico as a foreign limited liability company is canceled under Section 910 of the Revised Uniform Limited Liability Company Act may apply to the secretary of state for reinstatement within two years after the effective date of the cancellation of its registration. The application shall state:

                (1) the name of the foreign limited liability company at the time of the cancellation of its registration by the secretary of state;

                (2) the address of the principal office of the foreign limited liability company;

                (3) the address of its registered office and the name of its registered agent at that office;

                (4) the effective date of the cancellation of its registration; and

                (5) that the grounds for the cancellation of its registration did not exist or have been cured.

          B. To be reinstated, a foreign limited liability company shall:

                (1) pay all fees, taxes, interest and penalties that were due to the secretary of state at the time of the cancellation of its registration and all fees, taxes, interest and penalties that would have been due to the secretary of state while the company's registration as a foreign limited liability company was canceled; and

                (2) file with its application for reinstatement:

                     (i) a statement from the person appointed registered agent accepting appointment as registered agent;

                     (ii)  proof that the grounds for cancellation of the company's registration did not exist or have been cured; and

                     (iii) any other documents required to be filed under the Revised Uniform Limited Liability Company Act.

          C. If the secretary of state determines that an application under Subsection A of this section contains the required information, is reasonably satisfied that the information is correct, determines that the documents required to be filed under Subsection B of this section conform with the requirements of the Revised Uniform Limited Liability Company Act and determines that all payments required to be made to the secretary of state under Subsection B of this section have been made, the secretary of state shall:

                (1) cancel the cancellation of the foreign limited liability company's registration to do business in New Mexico as a foreign limited liability company and prepare a statement of reinstatement that states the secretary of state's determination of reinstatement and the effective date of reinstatement; and

                (2) file the statement of reinstatement and deliver a copy to the foreign limited liability company.

          D. When reinstatement under this section is effective:

                (1) the reinstatement relates back to and takes effect as of the effective date of the cancellation of the foreign limited liability company's registration to do business in New Mexico as a foreign limited liability company;

                (2) the foreign limited liability company resumes carrying on its activities and affairs as if the cancellation of the company's registration to do business in New Mexico as a foreign limited liability company had not occurred; and

                (3) the rights of a person arising out of an act or omission in reliance on the cancellation of the foreign limited liability company's registration to do business in New Mexico as a foreign limited liability company before the person knew or had notice of the reinstatement are not affected.

     SECTION 912. [NEW MATERIAL] JUDICIAL REVIEW OF DENIAL OF REINSTATEMENT.--

          A. If the secretary of state denies a foreign limited liability company's application for reinstatement following the cancellation of the company's registration to do business in New Mexico as a foreign limited liability company, the secretary of state shall deliver to the company a notice that briefly explains the reasons for the denial.

          B. A foreign limited liability company may appeal a denial of reinstatement pursuant to the provisions of Section 39-3-1.1 NMSA 1978.

     SECTION 913. [NEW MATERIAL] TERMINATION OF REGISTRATION OF REGISTERED FOREIGN LIMITED LIABILITY COMPANY.--

          A. A foreign limited liability company registered to do business in New Mexico may terminate its registration by application to the secretary of state for a certificate of termination. The application for termination shall set forth:

                (1) the name of the foreign limited liability company and, if different, the name under which the foreign limited liability company did business in New Mexico that complied with Section 906 of the Revised Uniform Limited Liability Company Act; and the jurisdiction under the laws of which it is organized;

                (2) that the foreign limited liability company is not doing business in New Mexico;

                (3) that the foreign limited liability company surrenders its registration to do business in New Mexico;

                (4) that the foreign limited liability company confirms the authority of its registered agent for service of process in New Mexico and consents that service of process in any action, suit or proceeding based upon any cause of action arising in New Mexico during the time that the foreign limited liability company was registered to do business in New Mexico also may be made on the foreign limited liability company by service upon the secretary of state;

                (5) an address to which a person may deliver a copy of any process against the foreign limited liability company; and

                (6) confirmation that the foreign limited liability company has resigned as a registered agent or is not currently a registered agent for any entity registered in New Mexico.

          B. The application for termination shall be in the form specified by the secretary of state and shall be executed for the foreign limited liability company by a person with authority to do so under the laws of the state or other jurisdiction of its organization or, if the foreign limited liability company is in the hands of a receiver or trustee, by the receiver or trustee on behalf of the foreign limited liability company. The applicant shall pay all fees, taxes, interest and penalties due to the secretary of state at the time of termination.

          C. If the secretary of state determines that an application under Subsection A of this section contains the required information, is satisfied that the information is correct and determines that all payments required to be made to the secretary of state by Subsection B of this section have been made, the secretary of state shall file a certificate of termination and shall deliver a copy of the certificate of termination to the foreign limited liability company. The certificate of termination shall be delivered to the foreign limited liability company pursuant to Section 210 of the Revised Uniform Limited Liability Company Act.

          D. A termination does not terminate the authority of the secretary of state to accept service of process on the foreign limited liability company with respect to causes of action arising out of its having done business in New Mexico.

ARTICLE 10

MERGER, INTEREST EXCHANGE, CONVERSION AND DOMESTICATION

     SECTION 1001. [NEW MATERIAL] DEFINITIONS.--As used in Article 10 of the Revised Uniform Limited Liability Company Act:

          A. "acquired entity" means the entity, all of one or more classes of interests of which are acquired in an interest exchange;

          B. "acquiring entity" means the entity that acquires all of one or more classes of interests of the acquired entity in an interest exchange;

          C. "conversion" means a transaction authorized under Sections 1019 through 1024 of the Revised Uniform Limited Liability Company Act;

          D. "converted entity" means the converting entity as it continues in existence after a conversion;

          E. "converting entity" means the domestic entity that approves a plan of conversion under Section 1021 of the Revised Uniform Limited Liability Company Act or the foreign entity that approves a conversion under the law of its jurisdiction of formation;

          F. "distributional interest" means the right under an unincorporated entity's organic law and organic rules to receive distributions from the entity;

          G. "domestic", with respect to an entity, means governed as to the entity's internal affairs by the law of New Mexico;

          H. "domesticated limited liability company" means the domesticating limited liability company as it continues in existence after a domestication;

          I. "domesticating limited liability company" means the domestic limited liability company that approves a plan of domestication under Section 1027 of the Revised Uniform Limited Liability Company Act or the foreign limited liability company that approves a domestication under the law of its jurisdiction of formation;

          J. "domestication" means a transaction authorized by Sections 1025 through 1030 of the Revised Uniform Limited Liability Company Act;

          K. "entity":

                (1) means:

                     (a) a business corporation;

                     (b) a general partnership, including a limited liability partnership;

                     (c) a limited partnership, including a limited liability limited partnership; or

                     (d) a limited liability company; but

                (2) does not include:

                     (a) an individual;

                     (b) a trust with a predominantly donative purpose, a charitable trust, a nonprofit corporation or an unincorporated nonprofit association;

                     (c) an association or relationship that is not an entity listed in Paragraph (1) of this subsection and is not a partnership under the rules stated in Section 55-1A-202 NMSA 1978 or a similar provision of the law of another jurisdiction;

                     (d) a decedent's estate; or

                     (e) a government or a governmental subdivision, agency or instrumentality;

          L. "filing entity" means an entity whose formation requires the filing of a public organic record. "Filing entity" does not include a limited liability partnership;

          M. "foreign", with respect to an entity, means an entity governed as to its internal affairs by the law of a jurisdiction other than New Mexico;

          N. "governance interest" means a right under the organic law or organic rules of an unincorporated entity, other than as a governor, an agent, an assignee or a proxy, to:

                (1) receive or demand access to information concerning, or the books and records of, the entity;

                (2) vote for or consent to the election of the governors of the entity; or

                (3) receive notice of or vote on or consent to an issue involving the internal affairs of the entity;

          O. "governor" means:

                (1) a director of a business corporation;

                (2) a general partner of a general partnership;

                (3) a general partner of a limited partnership;

                (4) a manager of a manager-managed limited liability company; or

                (5) a member of a member-managed limited liability company;

          P. "interest" means a:

                (1) share in a business corporation;

                (2) partnership interest in a general partnership;

                (3) partnership interest in a limited partnership; or

                (4) membership interest in a limited liability company;

          Q. "interest exchange" means a transaction authorized by Sections 1013 through 1018 of the Revised Uniform Limited Liability Company Act;

          R. "interest holder" means:

                (1) a shareholder of a business corporation;

                (2) a general partner of a general partnership;

                (3) a general partner of a limited partnership;

                (4) a limited partner of a limited partnership; or

                (5) a member of a limited liability company;

          S. "interest holder liability" means:

                (1) personal liability for a liability of an entity that is imposed on a person:

                     (a) solely by reason of the status of the person as an interest holder; or

                     (b) by the organic rules of the entity that make one or more specified interest holders or categories of interest holders liable in their capacity as interest holders for all or specified liabilities of the entity; or

                (2) an obligation of an interest holder under the organic rules of an entity to contribute to the entity;

          T. "merger" means a transaction authorized by Sections 1007 through 1012 of the Revised Uniform Limited Liability Company Act;

          U. "merging entity" means an entity that is a party to a merger and exists immediately before the merger becomes effective;

          V. "organic law" means the law of an entity's jurisdiction of formation governing the internal affairs of the entity;

          W. "organic rules" means the public organic record and private organic rules of an entity;

          X. "plan" means a plan of merger, plan of interest exchange, plan of conversion or plan of domestication;

          Y. "plan of conversion" means a plan under Section 1020 of the Revised Uniform Limited Liability Company Act;

          Z. "plan of domestication" means a plan under Section 1026 of the Revised Uniform Limited Liability Company Act;

          AA. "plan of interest exchange" means a plan under Section 1014 of the Revised Uniform Limited Liability Company Act;

          BB. "plan of merger" means a plan under Section 1008 of the Revised Uniform Limited Liability Company Act;

          CC. "private organic rules" means the rules, regardless of whether in a record, that govern the internal affairs of an entity, are binding on all of its interest holders and are not part of its public organic record, if any. "Private organic rules" includes the:

                (1) bylaws of a business corporation;

                (2) partnership agreement of a general partnership;

                (3) partnership agreement of a limited partnership; and

                (4) operating agreement of a limited liability company;

          DD. "protected agreement" means:

                (1) a record evidencing indebtedness and any related agreement in effect on July 1, 2024;

                (2) an agreement that is binding on an entity on that date;

                (3) the organic rules of an entity in effect on that date; or

                (4) an agreement that is binding on any of the governors or interest holders of an entity on that date;

          EE. "public organic record" means the record the filing of which by the secretary of state is required to form an entity and any amendment to or restatement of that record. "Public organic record" includes the:

                (1) articles of incorporation of a business corporation;

                (2) certificate of limited partnership of a limited partnership;

                (3) certificate of organization of a limited liability company;

                (4) articles of incorporation of a general cooperative association; and

                (5) certificate of trust of a statutory trust or similar record of a business trust;

          FF. "registered foreign entity" means a foreign entity that is registered to do business in New Mexico under a record filed by the secretary of state;

          GG. "statement of conversion" means a statement under Section 1023 of the Revised Uniform Limited Liability Company Act;

          HH. "statement of domestication" means a statement under Section 1029 of the Revised Uniform Limited Liability Company Act;

          II. "statement of interest exchange" means a statement under Section 1017 of the Revised Uniform Limited Liability Company Act;

          JJ. "statement of merger" means a statement under Section 1011 of the Revised Uniform Limited Liability Company Act;

          KK. "statement of qualification" means a statement of qualification filed under Section 54-1A-1001 NMSA 1978 for a domestic limited liability partnership;

          LL. "surviving entity" means the entity that continues in existence after or is created by a merger; and

          MM. "type of entity" means a generic form of entity:

                (1) recognized at common law; or

                (2) formed under an organic law, regardless of whether some entities formed under that organic law are subject to provisions of that law that create different categories of the form of entity.

     SECTION 1002. [NEW MATERIAL] RELATIONSHIP OF ARTICLE 10 OF THE REVISED UNIFORM LIMITED LIABILITY COMPANY ACT TO OTHER LAWS.--

          A. Article 10 of the Revised Uniform Limited Liability Company Act does not authorize an act prohibited by, and does not affect the application or requirements of, a law other than one in that article.

          B. The following types of persons may not participate in a transaction under Article 10 of the Revised Uniform Limited Liability Company Act:

                (1) a nonprofit corporation;

                (2) an unincorporated nonprofit association; or

                (3) any other person described in Paragraph (2) of Subsection K of Section 1001 of that act.

     SECTION 1003. [NEW MATERIAL] REQUIRED NOTICE OR APPROVAL--NAME OF SURVIVING, NEW, ACQUIRING, CONVERTED OR DOMESTICATED ENTITY.--

          A. A domestic or foreign entity that is required to give notice to, or obtain the approval of, a governmental agency or officer of New Mexico to be a party to a merger shall give the notice or obtain the approval to be a party to an interest exchange, conversion or domestication.

          B. Property held for a charitable purpose under the law of New Mexico by a domestic or foreign entity immediately before a transaction under Article 10 of the Revised Uniform Limited Liability Company Act becomes effective shall not, as a result of the transaction, be diverted from the objects for which it was donated, granted, devised or otherwise transferred unless, to the extent required by or under the law of New Mexico concerning cy-pres or other law dealing with non-diversion of charitable assets, the entity obtains an appropriate order of the court specifying the disposition of the property. The attorney general shall be given notice and an opportunity to be heard.

          C. A bequest, devise, gift, grant or promise contained in a will or other instrument of donation, subscription or conveyance that is made to a merging entity that is not the surviving entity and that takes effect or remains payable after the merger inures to the surviving entity.

          D. A trust obligation that would govern property if transferred to a non-surviving entity applies to property that is transferred to the surviving entity under this section.

          E. If the surviving, new, acquiring, converted or domesticated entity is to be a domestic limited liability company, the name of the company and, if different, the name of the company under which it proposes to do business in New Mexico, shall comply with Section 112 of the Revised Uniform Limited Liability Company Act. If the surviving, new, acquiring, converted or domesticated entity is to be a foreign limited liability company registered to do business in New Mexico, the name of the company, or if different, the name under which it proposes to do business in New Mexico, shall comply with Subsection A of Section 906 of the Revised Uniform Limited Liability Company Act. If the surviving, new, acquiring, converted or domesticated entity is to be a domestic corporation or a foreign corporation with a certificate of authority to do business in New Mexico, the name of the corporation shall comply with the Business Corporation Act.

     SECTION 1004. [NEW MATERIAL] NONEXCLUSIVITY.--The fact that a transaction effected under Article 10 of the Revised Uniform Limited Liability Company Act produces a certain result does not preclude the same result from being accomplished in another manner permitted by a law other than this article.

     SECTION 1005. [NEW MATERIAL] REFERENCE TO EXTERNAL FACTS.--A plan may refer to facts ascertainable outside the plan if the manner in which the facts will operate upon the plan is specified in the plan. The facts may include the occurrence of an event or a determination or action by a person, regardless of whether the event, determination or action is within the control of a party to the transaction.

     SECTION 1006. [NEW MATERIAL] APPRAISAL RIGHTS.--An interest holder of a domestic merging, acquired, converting or domesticating limited liability company is entitled to contractual appraisal rights in connection with a transaction under Article 10 of the Revised Uniform Limited Liability Company Act to the extent provided in the operating agreement or the plan.

     SECTION 1007. [NEW MATERIAL] MERGER AUTHORIZED.--

          A. By complying with Sections 1007 through 1012 of the Revised Uniform Limited Liability Company Act:

                (1) one or more domestic limited liability companies may merge with one or more domestic or foreign entities into a domestic or foreign surviving entity; and

                (2) two or more foreign entities may merge into a domestic limited liability company.

          B. By complying with Sections 1007 through 1012 of the Revised Uniform Limited Liability Company Act applicable to foreign entities, a foreign entity may be a party to a merger under those sections or may be the surviving entity in such a merger if the merger is authorized by the law of the foreign entity's jurisdiction of formation.

     SECTION 1008. [NEW MATERIAL] PLAN OF MERGER.--

          A. A domestic limited liability company may become a party to a merger under Sections 1007 through 1012 of the Revised Uniform Limited Liability Company Act by approving a plan of merger. The plan shall be in a record and contain:

                (1) as to each merging entity, its name, jurisdiction of formation and type of entity;

                (2) if the surviving entity is to be created in the merger, a statement to that effect and the entity's name, jurisdiction of formation and type of entity;

                (3) the manner of converting the interests in each party to the merger into interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing;

                (4) if the surviving entity exists before the merger, any proposed amendments to its:

                     (a) public organic record, if any; and

                     (b) private organic rules that are, or are proposed to be, in a record;

                (5) if the surviving entity is to be created in the merger:

                     (a) its proposed public organic record, if any; and

                     (b) the full text of its private organic rules that are proposed to be in a record;

                (6) the other terms and conditions of the merger; and

                (7) any other provision required by the law of a merging entity's jurisdiction of formation or the organic rules of a merging entity.

          B. In addition to the requirements in Subsection A of this section, a plan of merger may contain any other provision not prohibited by law.

     SECTION 1009. [NEW MATERIAL] APPROVAL OF MERGER.--

          A. A plan of merger is not effective unless it has been approved:

                (1) by a domestic merging limited liability company, by all of the members of the company who are entitled to vote on or consent to any matter; and

                (2) in a record, by each member of a domestic merging limited liability company that will have interest holder liability for debts, obligations and other liabilities that arise after the merger becomes effective, unless:

                     (a) the operating agreement of the company provides in a record for the approval of a merger in which some or all of its members become subject to interest holder liability by the affirmative vote or consent of fewer than all of the members; and

                     (b) the member consented in a record to or voted for that provision of the operating agreement or became a member after the adoption of that provision.

          B. A merger involving a domestic merging entity that is not a limited liability company is not effective unless the merger is approved by that entity in accordance with its organic law.

          C. A merger involving a foreign merging entity is not effective unless the merger is approved by the foreign entity in accordance with the law of the foreign entity's jurisdiction of formation.

     SECTION 1010. [NEW MATERIAL] AMENDMENT OR ABANDONMENT OF PLAN OF MERGER.--

          A. A plan of merger may be amended only with the consent of each party to the plan, except as otherwise provided in the plan.

          B. A domestic merging limited liability company may approve an amendment of a plan of merger:

                (1) in the same manner as the plan was approved, if the plan does not provide for the manner in which it may be amended; or

                (2) by the company's managers or members in the manner provided in the plan. However, a member that was entitled to vote on or consent to approval of the merger may vote on or consent to any amendment of the plan that will change:

                     (a) the amount or kind of interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing, to be received by the interest holders of any party to the plan;

                     (b) the public organic record, if any, or private organic rules of the surviving entity that will be in effect immediately after the merger becomes effective, except for changes that do not require approval of the interest holders of the surviving entity under its organic law or organic rules; or

                     (c) any other term or condition of the plan, if the change would adversely affect the member in any material respect.

          C. After a plan of merger has been approved and before a statement of merger becomes effective, the plan may be abandoned as provided in the plan. Unless prohibited by the plan, a domestic merging limited liability company may abandon the plan in the same manner as the plan was approved.

          D. If a plan of merger is abandoned after a statement of merger has been delivered to the secretary of state for filing and before the statement becomes effective, a statement of abandonment, signed by a party to the plan, shall be delivered to the secretary of state for filing before the statement of merger becomes effective. The statement of abandonment takes effect on filing, and the merger is abandoned and does not become effective. The statement of abandonment shall contain:

                (1) the name of each party to the plan of merger;

                (2) the date on which the statement of merger was filed by the secretary of state; and

                (3) a statement that the merger has been abandoned in accordance with this section.

     SECTION 1011. [NEW MATERIAL] STATEMENT OF MERGER--EFFECTIVE DATE OF MERGER.--

          A. A statement of merger shall be signed by each merging entity and delivered to the secretary of state for filing.

          B. A statement of merger shall contain:

                (1) the name, jurisdiction of formation and type of entity of each merging entity that is not the surviving entity;

                (2) the name, jurisdiction of formation and type of entity of the surviving entity;

                (3) a statement that the merger was approved by each domestic merging entity, if any, in accordance with Sections 1007 through 1012 of the Revised Uniform Limited Liability Company Act and by each foreign merging entity, if any, in accordance with the law of its jurisdiction of formation;

                (4) if the surviving entity exists before the merger and is a domestic filing entity, any amendment to its public organic record approved as part of the plan of merger;

                (5) if the surviving entity is created by the merger and is a domestic filing entity, its public organic record, as an attachment;

                (6) if the surviving entity is created by the merger and is a domestic limited liability partnership, its statement of qualification, as an attachment; and

                (7) if the surviving entity is a foreign entity that is not a registered foreign entity, an address to which the secretary of state may send any process delivered to the secretary of state under Subsection E of Section 1012 of the Revised Uniform Limited Liability Company Act.

          C. In addition to the requirements of Subsection B of this section, a statement of merger may contain any other provision not prohibited by law.

          D. If the surviving entity is a domestic entity, its public organic record, if any, must satisfy the requirements of the law of New Mexico.

          E. If the surviving entity is a domestic limited liability company, the merger is effective when the statement of merger is effective. In all other cases, the merger is effective on the later of:

                (1) the date provided by the organic law of the surviving entity; or

                (2) when the statement is effective.

     SECTION 1012. [NEW MATERIAL] EFFECT OF MERGER.--

          A. When a merger becomes effective:

                (1) the surviving entity continues or comes into existence;

                (2) each merging entity that is not the surviving entity ceases to exist;

                (3) all property of each merging entity vests in the surviving entity without transfer, reversion or impairment;

                (4) all debts, obligations and other liabilities of each merging entity are debts, obligations and other liabilities of the surviving entity;

                (5) except as otherwise provided by law or the plan of merger, all the rights, privileges, immunities, powers and purposes of each merging entity vest in the surviving entity;

                (6) if the surviving entity exists before the merger:

                     (a) all its property continues to be vested in it without transfer, reversion or impairment;

                     (b) it remains subject to all its debts, obligations and other liabilities; and

                     (c) all its rights, privileges, immunities, powers and purposes continue to be vested in it;

                (7) the name of the surviving entity may be substituted for the name of any merging entity that is a party to any pending action or proceeding;

                (8) if the surviving entity exists before the merger, its:

                     (a) public organic record, if any, is amended to the extent provided in the statement of merger; and

                     (b) private organic rules that are to be in a record, if any, are amended to the extent provided in the plan of merger;

                (9) if the surviving entity is created by the merger, its private organic rules are effective, and if it is a:

                     (a) filing entity, its public organic record is effective; and

                     (b) limited liability partnership, its statement of qualification is effective; and

                (10) the interests in each merging entity that are to be converted in the merger are converted, and the interest holders of those interests are entitled only to the rights provided to them under the plan of merger and to any appraisal rights they have under Section 1006 of the Revised Uniform Limited Liability Company Act and the merging entity's organic law.

          B. Except as otherwise provided in the organic law or organic rules of a merging entity, the merger does not give rise to any rights that an interest holder, a governor or a third party would have upon a dissolution, liquidation or winding up of the merging entity.

          C. When a merger becomes effective, a person that did not have interest holder liability with respect to any of the merging entities and that becomes subject to interest holder liability with respect to a domestic entity as a result of the merger has interest holder liability only to the extent provided by the organic law of that entity and only for those debts, obligations and other liabilities that arise after the merger becomes effective.

          D. When a merger becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic merging limited liability company with respect to which the person had interest holder liability is subject to the following rules:

                (1) the merger does not discharge any interest holder liability under the Revised Uniform Limited Liability Company Act to the extent that the interest holder liability arose before the merger became effective;

                (2) the person does not have interest holder liability under that act for any debt, obligation or other liability that arises after the merger becomes effective;

                (3) that act continues to apply to the release, collection or discharge of any interest holder liability preserved under Paragraph (1) of this subsection as if the merger had not occurred; and

                (4) the person has whatever rights of contribution from any other person as provided by that act, a law other than one in that act or the operating agreement of the domestic merging limited liability company with respect to any interest holder liability preserved under Paragraph (1) of this subsection as if the merger had not occurred.

          E. When a merger becomes effective, a foreign entity that is the surviving entity may be served with process in New Mexico for the collection and enforcement of any debts, obligations or other liabilities of a domestic merging limited liability company as provided in Section 116 of the Revised Uniform Limited Liability Company Act.

          F. When a merger becomes effective, the registration to do business in New Mexico of any foreign merging entity that is not the surviving entity is canceled.

          G. If a foreign entity is the surviving entity, it shall not do business in New Mexico until it becomes a registered foreign entity.

          H. A merger does not require a merging limited liability company or other entity to wind up its affairs and does not constitute or cause the dissolution of the limited liability company or other entity.

     SECTION 1013. [NEW MATERIAL] INTEREST EXCHANGE AUTHORIZED.--

          A. By complying with Sections 1013 through 1018 of the Revised Uniform Limited Liability Company Act:

                (1) a domestic limited liability company may acquire all of one or more classes of interests of another domestic entity or a foreign entity in exchange for interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing; or

                (2) all of one or more classes of interests of a domestic limited liability company may be acquired by another domestic entity or a foreign entity in exchange for interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing.

          B. By complying with Sections 1013 through 1018 of the Revised Uniform Limited Liability Company Act applicable to foreign entities, a foreign entity may be the acquiring or acquired entity in an interest exchange under Sections 1013 through 1018 of that act if the interest exchange is authorized by the law of the foreign entity's jurisdiction of formation.

     SECTION 1014. [NEW MATERIAL] PLAN OF INTEREST EXCHANGE.--

          A. A domestic limited liability company may be the acquired entity in an interest exchange under Sections 1013 through 1018 of the Revised Uniform Limited Liability Company Act by approving a plan of interest exchange. The plan shall be in a record and shall contain:

                (1) the name of the acquired entity;

                (2) the name, jurisdiction of formation and type of entity of the acquiring entity;

                (3) the manner of converting the interests in the acquired entity into interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing;

                (4) any proposed amendments to the:

                     (a) certificate of organization of the acquired entity; and

                     (b) operating agreement of the acquired entity that are, or are proposed to be, in a record;

                (5) the other terms and conditions of the interest exchange; and

                (6) any other provision required by the law of New Mexico or the operating agreement of the acquired entity.

          B. In addition to the requirements of Subsection A of this section, a plan of interest exchange may contain any other provision not prohibited by law.

     SECTION 1015. [NEW MATERIAL] APPROVAL OF INTEREST EXCHANGE.--

          A. A plan of interest exchange is not effective unless it has been approved:

                (1) by all the members of a domestic acquired limited liability company entitled to vote on or consent to any matter; and

                (2) in a record, by each member of the domestic acquired limited liability company that will have interest holder liability for debts, obligations and other liabilities that arise after the interest exchange becomes effective, unless:

                     (a) the operating agreement of the company provides in a record for the approval of an interest exchange or a merger in which some or all its members become subject to interest holder liability by the affirmative vote or consent of fewer than all the members; and

                     (b) the member consented in a record to or voted for that provision of the operating agreement or became a member after the adoption of that provision.

          B. An interest exchange involving a domestic acquired entity that is not a limited liability company is not effective unless it is approved by the domestic entity in accordance with its organic law.

          C. An interest exchange involving a foreign acquired entity is not effective unless it is approved by the foreign entity in accordance with the law of the foreign entity's jurisdiction of formation.

          D. Except as otherwise provided in its organic law or organic rules, the interest holders of the acquiring entity are not required to approve the interest exchange.

     SECTION 1016. [NEW MATERIAL] AMENDMENT OR ABANDONMENT OF PLAN OF INTEREST EXCHANGE.--

          A. A plan of interest exchange may be amended only with the consent of each party to the plan, except as otherwise provided in the plan.

          B. A domestic acquired limited liability company may approve an amendment of a plan of interest exchange:

                (1) in the same manner as the plan was approved, if the plan does not provide for the manner in which it may be amended; or

                (2) by its managers or members in the manner provided in the plan. However, a member that was entitled to vote on or consent to approval of the interest exchange is entitled to vote on or consent to any amendment of the plan that will change:

                     (a) the amount or kind of interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing, to be received by any of the members of the acquired company under the plan;

                     (b) the certificate of organization or operating agreement of the acquired company that will be in effect immediately after the interest exchange becomes effective, except for changes that do not require approval of the members of the acquired company under the Revised Uniform Limited Liability Company Act or the operating agreement; or

                     (c) any other terms or conditions of the plan, if the change would adversely affect the member in any material respect.

          C. After a plan of interest exchange has been approved and before a statement of interest exchange becomes effective, the plan may be abandoned as provided in the plan. Unless prohibited by the plan, a domestic acquired limited liability company may abandon the plan in the same manner the plan was approved.

          D. If a plan of interest exchange is abandoned after a statement of interest exchange has been delivered to the secretary of state for filing and before the statement becomes effective, a statement of abandonment, signed by the acquired limited liability company, shall be delivered to the secretary of state for filing before the statement of interest exchange becomes effective. The statement of abandonment takes effect on filing, and the interest exchange is abandoned and does not become effective. The statement of abandonment shall contain:

                (1) the name of the acquired company;

                (2) the date on which the statement of interest exchange was filed by the secretary of state; and

                (3) a statement that the interest exchange has been abandoned in accordance with this section.

     SECTION 1017. [NEW MATERIAL] STATEMENT OF INTEREST EXCHANGE--EFFECTIVE DATE OF INTEREST EXCHANGE.--

          A. A statement of interest exchange shall be signed by a domestic acquired limited liability company and delivered to the secretary of state for filing.

          B. A statement of interest exchange shall contain:

                (1) the name of the acquired limited liability company;

                (2) the name, jurisdiction of formation and type of entity of the acquiring entity;

                (3) a statement that the plan of interest exchange was approved by the acquired company in accordance with Sections 1013 through 1018 of the Revised Uniform Limited Liability Company Act; and

                (4) any amendments to the company's certificate of organization approved as part of the plan of interest exchange.

          C. In addition to the requirements of Subsection B of this section, a statement of interest exchange may contain any other provision not prohibited by law.

          D. An interest exchange is effective when the statement of interest exchange is effective.

     SECTION 1018. [NEW MATERIAL] EFFECT OF INTEREST EXCHANGE.--

          A. When an interest exchange in which the acquired entity is a domestic limited liability company becomes effective, the:

                (1) interests in the acquired company that are the subject of the interest exchange are converted, and the members holding those interests are entitled only to the rights provided to them by the plan of interest exchange and to any appraisal rights that they have under Section 1006 of the Revised Uniform Limited Liability Company Act;

                (2) acquiring entity becomes the interest holder of the interests in the acquired company stated in the plan of interest exchange to be acquired by the acquiring entity;

                (3) certificate of organization of the acquired company is amended to the extent provided in the statement of interest exchange; and

                (4) provisions of the operating agreement of the acquired company that are to be in a record, if any, are amended to the extent provided in the plan of interest exchange.

          B. Except as otherwise provided in the operating agreement of a domestic acquired limited liability company, the interest exchange does not give rise to any rights that a member, manager or third party would have upon a dissolution, liquidation or winding up of the acquired company.

          C. When an interest exchange becomes effective, a person that did not have interest holder liability with respect to a domestic acquired limited liability company and that becomes subject to interest holder liability with respect to a domestic entity as a result of the interest exchange has interest holder liability only to the extent provided by the organic law of the entity and only for those debts, obligations and other liabilities that arise after the interest exchange becomes effective.

          D. When an interest exchange becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic acquired limited liability company with respect to which the person had interest holder liability is subject to the following rules:

                (1) the interest exchange does not discharge any interest holder liability under the Revised Uniform Limited Liability Company Act to the extent that the interest holder liability arose before the interest exchange became effective;

                (2) the person does not have interest holder liability under that act for any debt, obligation or other liability that arises after the interest exchange becomes effective;

                (3) that act continues to apply to the release, collection or discharge of any interest holder liability preserved under Paragraph (1) of this subsection as if the interest exchange had not occurred; and

                (4) the person has whatever rights of contribution from any other person as are provided by that act, a law other than one in that act or the operating agreement of the acquired company with respect to any interest holder liability preserved under Paragraph (1) of this subsection as if the interest exchange had not occurred.

     SECTION 1019. [NEW MATERIAL] CONVERSION AUTHORIZED.--

          A. By complying with Sections 1019 through 1024 of the Revised Uniform Limited Liability Company Act, a domestic limited liability company may become a:

                (1) domestic entity that is a different type of entity; or

                (2) foreign entity that is a different type of entity, if the conversion is authorized by the law of the foreign entity's jurisdiction of formation.

          B. By complying with the provisions of Sections 1019 through 1024 of the Revised Uniform Limited Liability Company Act applicable to foreign entities, a foreign entity that is not a foreign limited liability company may become a domestic limited liability company if the conversion is authorized by the law of the foreign entity's jurisdiction of formation.

     SECTION 1020. [NEW MATERIAL] PLAN OF CONVERSION.--

          A. A domestic limited liability company may convert to a different type of entity under Sections 1019 through 1024 of the Revised Uniform Limited Liability Company Act by approving a plan of conversion. The plan shall be in a record and contain:

                (1) the name of the converting limited liability company;

                (2) the name, jurisdiction of formation and type of entity of the converted entity;

                (3) the manner of converting the interests in the converting limited liability company into interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing;

                (4) the proposed public organic record of the converted entity if it will be a filing entity;

                (5) the full text of the private organic rules of the converted entity that are proposed to be in a record;

                (6) the other terms and conditions of the conversion; and

                (7) any other provision required by the law of New Mexico or the operating agreement of the converting limited liability company.

          B. In addition to the requirements in Subsection A of this section, a plan of conversion may contain any other provision not prohibited by law.

     SECTION 1021. [NEW MATERIAL] APPROVAL OF CONVERSION.--

          A. A plan of conversion is not effective unless it has been approved:

                (1) by a domestic converting limited liability company, by all the members of the limited liability company entitled to vote on or consent to any matter; and

                (2) in a record, by each member of a domestic converting limited liability company that will have interest holder liability for debts, obligations and other liabilities that arise after the conversion becomes effective, unless:

                     (a) the operating agreement of the company provides in a record for the approval of a conversion or a merger in which some or all of its members become subject to interest holder liability by the affirmative vote or consent of fewer than all the members; and

                     (b) the member voted for or consented in a record to that provision of the operating agreement or became a member after the adoption of that provision.

          B. A conversion involving a domestic converting entity that is not a limited liability company is not effective unless it is approved by the domestic converting entity in accordance with its organic law.

          C. A conversion of a foreign converting entity is not effective unless it is approved by the foreign entity in accordance with the law of the foreign entity's jurisdiction of formation.

     SECTION 1022. [NEW MATERIAL] AMENDMENT OR ABANDONMENT OF PLAN OF CONVERSION.--

          A. A plan of conversion of a domestic converting limited liability company may be amended:

                (1) in the same manner as the plan was approved, if the plan does not provide for the manner in which it may be amended; or

                (2) by its managers or members in the manner provided in the plan, but a member that was entitled to vote on or consent to approval of the conversion is entitled to vote on or consent to any amendment of the plan that will change:

                     (a) the amount or kind of interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing, to be received by any of the members of the converting company under the plan;

                     (b) the public organic record, if any, or private organic rules of the converted entity that will be in effect immediately after the conversion becomes effective, except for changes that do not require the approval of the interest holders of the converted entity under its organic law or organic rules; or

                     (c) any other terms or conditions of the plan, if the change would adversely and materially affect the member.

          B. After a plan of conversion has been approved by a domestic converting limited liability company and before a statement of conversion becomes effective, the plan may be abandoned as provided in the plan. Unless prohibited by the plan, a domestic converting limited liability company may abandon the plan in the same manner as the plan was approved.

          C. If a plan of conversion is abandoned after a statement of conversion has been delivered to the secretary of state for filing and before the statement becomes effective, a statement of abandonment, signed by the converting entity, shall be delivered to the secretary of state for filing before the statement of conversion becomes effective. The statement of abandonment takes effect on filing, and the conversion is abandoned and does not become effective. The statement of abandonment shall contain:

                (1) the name of the converting limited liability company;

                (2) the date on which the statement of conversion was filed by the secretary of state; and

                (3) a statement that the conversion has been abandoned in accordance with the provisions of this section.

     SECTION 1023. [NEW MATERIAL] STATEMENT OF CONVERSION--EFFECTIVE DATE OF CONVERSION.--

          A. A statement of conversion shall be signed by the converting entity and delivered to the secretary of state for filing.

          B. A statement of conversion shall contain:

                (1) the name, jurisdiction of formation and type of entity of the converting entity;

                (2) the name, jurisdiction of formation and type of entity of the converted entity;

                (3) if the converting entity is a domestic limited liability company, a statement that the plan of conversion was approved in accordance with Sections 1019 through 1024 of the Revised Uniform Limited Liability Company Act or, if the converting entity is a foreign entity, a statement that the conversion was approved by the foreign entity in accordance with the law of its jurisdiction of formation;

                (4) if the converted entity is a domestic filing entity, its public organic record, as an attachment;

                (5) if the converted entity is a domestic limited liability partnership, its statement of qualification, as an attachment; and

                (6) if the converted entity is a foreign entity, an address to which the secretary of state may send any process delivered to the secretary of state under Subsection E of Section 1024 of the Revised Uniform Limited Liability Company Act.

          C. In addition to the requirements of Subsection B of this section, a statement of conversion may contain any other provision not prohibited by law.

          D. If the converted entity is a domestic entity, its public organic record, if any, shall satisfy the requirements of the law of New Mexico.

          E. If the converted entity is a domestic limited liability company, the conversion is effective when the statement of conversion is effective. In all other cases, the conversion is effective on the later of:

                (1) the date and time provided by the organic law of the converted entity; or

                (2) when the statement is effective.

     SECTION 1024. [NEW MATERIAL] EFFECT OF CONVERSION.--

          A. When a conversion becomes effective:

                (1) the converted entity is:

                     (a) organized under and subject to the organic law of the converted entity; and

                     (b) without interruption, the same entity as the converting entity;

                (2) all property of the converting entity continues to be vested in the converted entity without transfer, reversion or impairment;

                (3) all debts, obligations and other liabilities of the converting entity continue as debts, obligations and other liabilities of the converted entity;

                (4) except as otherwise provided by law or the plan of conversion, all the rights, privileges, immunities, powers and purposes of the converting entity remain in the converted entity;

                (5) the name of the converted entity may be substituted for the name of the converting entity in any pending action or proceeding;

                (6) the certificate of organization of the converted entity is effective;

                (7) the provisions of the operating agreement of the converted entity that are to be in a record, if any, approved as part of the plan of conversion are effective; and

                (8) the interests in the converting entity are converted, and the interest holders of the converting entity are entitled only to the rights provided to them under the plan of conversion and to any appraisal rights they have under Section 1006 of the Revised Uniform Limited Liability Company Act.

          B. Except as otherwise provided in the operating agreement of a domestic converting limited liability company, the conversion does not give rise to any right that a member, manager or third party would have upon a dissolution, liquidation or winding up of the converting entity.

          C. When a conversion becomes effective, a person that did not have interest holder liability with respect to the converting entity and becomes subject to interest holder liability with respect to a domestic entity as a result of the conversion has interest holder liability only to the extent provided by the organic law of the entity and only for those debts, obligations and other liabilities that arise after the conversion becomes effective.

          D. When a conversion becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic converting limited liability company with respect to which the person had interest holder liability is subject to the following rules:

                (1) the conversion does not discharge any interest holder liability under the Revised Uniform Limited Liability Company Act to the extent that the interest holder liability arose before the conversion became effective;

                (2) the person does not have interest holder liability under that act for any debt, obligation or other liability that arises after the conversion becomes effective;

                (3) that act continues to apply to the release, collection or discharge of any interest holder liability preserved under Paragraph (1) of this subsection as if the conversion had not occurred; and

                (4) the person has whatever rights of contribution from any other person as are provided by that act, a law other than one in that act or the organic rules of the converting entity with respect to any interest holder liability preserved under Paragraph (1) of this subsection as if the conversion had not occurred.

          E. When a conversion becomes effective, a foreign entity that is the converted entity may be served with process in New Mexico for the collection and enforcement of any of its debts, obligations and other liabilities as provided in Section 116 of the Revised Uniform Limited Liability Company Act.

          F. If the converting entity is a registered foreign entity, its registration to do business in New Mexico is canceled when the conversion becomes effective. If the converted entity is a foreign entity, it shall not do business in New Mexico until it becomes a registered foreign entity.

          G. A conversion does not require the entity to wind up its affairs and does not constitute or cause the dissolution of the entity.

     SECTION 1025. [NEW MATERIAL] DOMESTICATION AUTHORIZED.--

          A. By complying with Sections 1025 through 1030 of the Revised Uniform Limited Liability Company Act, a domestic limited liability company may become a foreign limited liability company if the domestication is authorized by the law of the foreign jurisdiction.

          B. By complying with the provisions of Sections 1025 through 1030 of the Revised Uniform Limited Liability Company Act applicable to foreign limited liability companies, a foreign limited liability company may become a domestic limited liability company if the domestication is authorized by the law of the foreign limited liability company's jurisdiction of formation.

     SECTION 1026. [NEW MATERIAL] PLAN OF DOMESTICATION.--

          A. A domestic limited liability company may become a foreign limited liability company in a domestication by approving a plan of domestication. The plan shall be in a record and shall contain:

                (1) the name of the domesticating limited liability company;

                (2) the name and jurisdiction of formation of the domesticated limited liability company;

                (3) the manner of converting the interests in the domesticating limited liability company into interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing;

                (4) the proposed certificate of organization of the domesticated limited liability company;

                (5) the full text of the provisions of the operating agreement of the domesticated limited liability company that are proposed to be in a record;

                (6) the other terms and conditions of the domestication; and

                (7) any other provision required by the law of New Mexico or the operating agreement of the domesticating limited liability company.

          B. In addition to the requirements of Subsection A of this section, a plan of domestication may contain any other provision not prohibited by law.

     SECTION 1027. [NEW MATERIAL] APPROVAL OF DOMESTICATION.--

          A. A plan of domestication of a domestic domesticating limited liability company is not effective unless it has been approved:

                (1) by all the members entitled to vote on or consent to any matter; and

                (2) in a record, by each member that will have interest holder liability for debts, obligations and other liabilities that arise after the domestication becomes effective, unless:

                     (a) the operating agreement of the domesticating company in a record provides for the approval of a domestication or merger in which some or all of its members become subject to interest holder liability by the affirmative vote or consent of fewer than all the members; and

                     (b) the member voted for or consented in a record to that provision of the operating agreement or became a member after the adoption of that provision.

          B. A domestication of a foreign domesticating limited liability company is not effective unless it is approved in accordance with the law of the foreign limited liability company's jurisdiction of formation.

     SECTION 1028. [NEW MATERIAL] AMENDMENT OR ABANDONMENT OF PLAN OF DOMESTICATION.--

          A. A plan of domestication of a domestic domesticating limited liability company may be amended:

                (1) in the same manner as the plan was approved, if the plan does not provide for the manner in which it may be amended; or

                (2) by its managers or members in the manner provided in the plan, but a member that was entitled to vote on or consent to the approval of the domestication is entitled to vote on or consent to any amendment of the plan that will change:

                     (a) the amount or kind of interests, securities, obligations, money, other property, rights to acquire interests or securities or any combination of the foregoing, to be received by any of the members of the domesticating limited liability company under the plan;

                     (b) the certificate of organization or operating agreement of the domesticated limited liability company that will be in effect immediately after the domestication becomes effective, except for changes that do not require the approval of the members of the domesticated limited liability company under its organic law or operating agreement; or

                     (c) any other terms or conditions of the plan, if the change would adversely affect the member in any material respect.

          B. After a plan of domestication has been approved by a domestic domesticating limited liability company and before a statement of domestication becomes effective, the plan may be abandoned as provided in the plan. Unless prohibited by the plan, a domestic domesticating limited liability company may abandon the plan in the same manner as the plan was approved.

          C. If a plan of domestication is abandoned after a statement of domestication has been delivered to the secretary of state for filing and before the statement becomes effective, a statement of abandonment, signed by the domesticating limited liability company, shall be delivered to the secretary of state for filing before the statement of domestication becomes effective. The statement of abandonment takes effect on filing, and the domestication is abandoned and does not become effective. The statement of abandonment shall contain:

                (1) the name of the domesticating limited liability company;

                (2) the date on which the statement of domestication was filed by the secretary of state; and

                (3) a statement that the domestication has been abandoned in accordance with this section.

     SECTION 1029. [NEW MATERIAL] STATEMENT OF DOMESTICATION--EFFECTIVE DATE OF DOMESTICATION.--

          A. A statement of domestication shall be signed by the domesticating limited liability company and delivered to the secretary of state for filing.

          B. A statement of domestication shall contain:

                (1) the name and jurisdiction of formation of the domesticating limited liability company;

                (2) the name and jurisdiction of formation of the domesticated limited liability company;

                (3) if the domesticating limited liability company is a domestic limited liability company, a statement that the plan of domestication was approved in accordance with Sections 1025 through 1030 of the Revised Uniform Limited Liability Company Act or, if the domesticating limited liability company is a foreign limited liability company, a statement that the domestication was approved in accordance with the law of its jurisdiction of formation;

                (4) the certificate of organization of the domesticated limited liability company, as an attachment; and

                (5) if the domesticated entity is a foreign limited liability company, an address to which the secretary of state may send any process delivered to the secretary of state under Subsection E of Section 1030 of the Revised Uniform Limited Liability Company Act.

          C. In addition to the requirements of Subsection B of this section, a statement of domestication may contain any other provision not prohibited by law.

          D. The certificate of organization of a domestic domesticated limited liability company shall satisfy the requirements of the Revised Uniform Limited Liability Company Act.

          E. If the domesticated entity is a domestic limited liability company, the domestication is effective when the statement of domestication is effective. If the domesticated entity is a foreign limited liability company, the domestication is effective on the later of:

                (1) the date and time provided by the organic law of the domesticated entity; or

                (2) when the statement is effective.

     SECTION 1030. [NEW MATERIAL] EFFECT OF DOMESTICATION.--

          A. When a domestication becomes effective:

                (1) the domesticated entity is:

                     (a) organized under and subject to the organic law of the domesticated entity; and

                     (b) without interruption, the same entity as the domesticating entity;

                (2) all property of the domesticating entity continues to be vested in the domesticated entity without transfer, reversion or impairment;

                (3) all debts, obligations and other liabilities of the domesticating entity continue as debts, obligations and other liabilities of the domesticated entity;

                (4) except as otherwise provided by law or the plan of domestication, all the rights, privileges, immunities, powers and purposes of the domesticating entity remain in the domesticated entity;

                (5) the name of the domesticated entity may be substituted for the name of the domesticating entity in any pending action or proceeding;

                (6) the certificate of organization of the domesticated entity is effective;

                (7) the provisions of the operating agreement of the domesticated entity that are to be in a record, if any, and that are approved as part of the plan of domestication, are effective; and

                (8) the interests in the domesticating entity are converted to the extent and as approved in connection with the domestication, and the members of the domesticating entity are entitled only to the rights provided to them under the plan of domestication and to any appraisal rights they have under Section 1006 of the Revised Uniform Limited Liability Company Act.

          B. Except as otherwise provided in the organic law or operating agreement of the domesticating limited liability company, the domestication does not give rise to any rights that a member, manager or third party would otherwise have upon a dissolution, liquidation or winding up of the domesticating company.

          C. When a domestication becomes effective, a person that did not have interest holder liability with respect to the domesticating limited liability company and that becomes subject to interest holder liability with respect to a domestic company as a result of the domestication has interest holder liability only to the extent provided by the Revised Uniform Limited Liability Company Act and only for those debts, obligations and other liabilities that arise after the domestication becomes effective.

          D. When a domestication becomes effective, the interest holder liability of a person that ceases to hold an interest in a domestic domesticating limited liability company with respect to which the person had interest holder liability is subject to the following rules:

                (1) the domestication does not discharge any interest holder liability under the Revised Uniform Limited Liability Company Act to the extent that the interest holder liability arose before the domestication became effective;

                (2) a person does not have interest holder liability under that act for any debt, obligation or other liability that arises after the domestication becomes effective;

                (3) that act continues to apply to the release, collection or discharge of any interest holder liability preserved under Paragraph (1) of this subsection as if the domestication had not occurred; and

                (4) a person has whatever rights of contribution from any other person as provided by that act, a law other than that act or the operating agreement of the domestic domesticating limited liability company with respect to any interest holder liability preserved under Paragraph (1) of this subsection as if the domestication had not occurred.

          E. When a domestication becomes effective, a foreign limited liability company that is the domesticated company may be served with process in New Mexico for the collection and enforcement of any of its debts, obligations and liabilities as provided in Section 116 of the Revised Uniform Limited Liability Company Act.

          F. If the domesticating limited liability company is a registered foreign entity, the registration of the company is canceled when the domestication becomes effective.

          G. If the domesticating limited liability company is a domestic entity, the domestication does not require it to wind up its affairs and does not constitute or cause the dissolution of the company.

ARTICLE 11

MISCELLANEOUS PROVISIONS

     SECTION 1101. [NEW MATERIAL] UNIFORMITY OF APPLICATION AND CONSTRUCTION.--In applying and construing the provisions of the Revised Uniform Limited Liability Company Act, consideration shall be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

     SECTION 1102. [NEW MATERIAL] RELATION TO ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT.--The Revised Uniform Limited Liability Company Act modifies, limits and supersedes the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001 et seq., but does not modify, limit or supersede Section 101(c) of that act, 15 U.S.C. Section 7001(c) or authorize electronic delivery of any of the notices described in Section 103(b) of that act, 15 U.S.C. Section 7003(b).

     SECTION 1103. [NEW MATERIAL] SAVING CLAUSE.--The Revised Uniform Limited Liability Company Act does not affect an action commenced, a proceeding brought or a right accrued before July 1, 2024.

     SECTION 1104. Section 47-1-4.1 NMSA 1978 (being Laws 2019, Chapter 130, Section 3) is amended to read:

     "47-1-4.1. ACTUAL AUTHORITY--REPRESENTATIVES OF BUSINESS ENTITIES--EXCEPTION.--

          A. Except as provided in Subsections B and D of this section, the persons in the following offices or positions shall each have the authority to execute conveyancing instruments and contracts for the transfer or encumbrance of real property owned by a business entity:

                (1) for a cooperative association: president and vice president;

                (2) for a professional corporation: president and vice president;

                (3) for a nonprofit corporation: president and vice president;

                (4) for a business corporation: president and vice president;

                (5) for a limited liability company: manager, member manager, president and vice president;

                (6) for a general partnership: partner;

                (7) for a limited liability partnership: general partner; and

                (8) for a limited partnership: general partner.

          B. A business entity may limit or expand the authority provided for in Subsection A of this section by filing with the county clerk, in the county where the real property is located, a statement reflecting limitations on the persons listed as having authority, requiring multiple persons to exercise such authority or authorizing other officers or positions to have the requisite authority to act to transfer or encumber real property owned by the business entity. The recorded statement shall be binding until the business entity revokes or amends the recorded statement and records the revocation or amendment with the county clerk.

          C. A person may rely on the authority of the persons set forth in Subsection A of this section to act on behalf of a business entity, subject to limitations set forth in a previously recorded statement as provided in Subsection B of this section. Nothing in this section shall preclude a business entity from executing a power of attorney and empowering an attorney in fact to also act on its behalf pursuant to the Uniform Power of Attorney Act.

          D. An instrument or contract for the transfer or encumbrance of real property by a person without the authority provided in Subsection A or B of this section may be relied upon as binding the business entity if the instrument or contract has been recorded for a period exceeding ten years. That recorded instrument or contract may not be relied upon as binding, however, if:

                (1) prior to the execution of that instrument or contract, the business entity recorded another document reflecting that the person who executed the instrument or contract did not have the authority to bind the business entity; or

                (2) the authority of the person who executed the instrument or contract has been successfully challenged or is in the process of being challenged in a court having jurisdiction.

          E. As used in this section, "business entity" means a:

                (1) cooperative association created pursuant to the Cooperative Association Act;

                (2) professional corporation created pursuant to the Professional Corporation Act;

                (3) nonprofit corporation created pursuant to the Nonprofit Corporation Act;

                (4) business corporation created pursuant to the Business Corporation Act;

                (5) limited liability company created pursuant to the Limited Liability Company Act or the Revised Uniform Limited Liability Company Act;

                (6) partnership created pursuant to the Uniform Partnership Act (1994);

                (7) limited liability partnership created pursuant to the Uniform Partnership Act (1994); or

                (8) limited partnership or limited liability limited partnership created pursuant to the Uniform Revised Limited Partnership Act."

     SECTION 1105. Section 53-11-2 NMSA 1978 (being Laws 1967, Chapter 81, Section 2, as amended) is amended to read:

     "53-11-2. DEFINITIONS.--As used in the Business Corporation Act, unless the text otherwise requires:

          A. "corporation" or "domestic corporation" means a corporation for profit subject to the provisions of the Business Corporation Act, except a foreign corporation;

          B. "foreign corporation" means a corporation for profit organized under laws other than the laws of [this state] New Mexico for a purpose for which a corporation may be organized under the Business Corporation Act;

          C. "articles of incorporation" means the original or restated articles of incorporation or articles of consolidation and all amendments thereto, including articles of merger;

          D. "shares" means the units into which the proprietary interests in a corporation are divided;

          E. "subscriber" means one who subscribes for shares in a corporation, whether before or after incorporation;

          F. "shareholder" means one who is a holder of record of shares in a corporation;

          G. "authorized shares" means the shares of all classes [which] that the corporation is authorized to issue;

          H. "annual report" means the corporate report required by the Corporate Reports Act;

          I. "distribution" means a direct or indirect transfer of money or other property (except its own shares) or incurrence of indebtedness, by a corporation to or for the benefit of any of its shareholders in respect of any of its shares, whether by dividend or by purchase redemption or other acquisition of its shares, or otherwise;

          J. "franchise tax" means the franchise tax imposed by the Corporate Income and Franchise Tax Act;

          K. "fees" means the fees imposed by Section 53-2-1 NMSA 1978;

          L. "commission" means the public regulation commission or its delegate;

          M. "address" means:

                (1) the mailing address and the street address, if within a municipality; or

                (2) the mailing address and a rural route number and box number, if any, or the geographical location, using well-known landmarks, if outside a municipality; [and]

          N. "delivery" means:

                (1) if [personally served] delivered to the secretary of state, the date on which the documentation is received by the [corporations bureau of the commission] secretary of state; and

                (2) if [mailed, the date of the postmark plus three days, upon proof thereof by the party delivering the documentation] delivered to a corporation, foreign corporation or person other than the secretary, the documentation is delivered on the earliest of:

                     (a) the date the person receives the documentation;

                     (b) the date shown on the return receipt, if signed by the corporation, foreign corporation or other person; or

                     (c) five days after the deposit of the documentation with the United States postal service, or with commercial delivery service, if correctly addressed and with prepayment of sufficient postage or fees and charges; and

          O. "secretary" means the secretary of state or the secretary of state's delegate."

     SECTION 1106. Section 53-11-28 NMSA 1978 (being Laws 1967, Chapter 81, Section 27, as amended) is amended to read:

     "53-11-28. MEETINGS OF SHAREHOLDERS.--

          A. Meetings of shareholders may be held at any place within or without [this state] New Mexico in accordance with the bylaws. If no other place is designated in, or fixed in accordance with, the bylaws, meetings shall be held at the principal place of business of the corporation.

          B. An annual meeting of the shareholders shall be held at the time designated in or fixed in accordance with the bylaws. If the annual meeting is not held within any thirteen-month period, the district court may, on the application of any shareholder, order a meeting to be held.

          C. Special meetings of the shareholders may be called by the board of directors, the holders of not less than one-tenth of all the shares entitled to vote at the meeting or such other persons as may be authorized in the articles of incorporation or the bylaws.

          D. Except as otherwise restricted by the articles of incorporation or bylaws, shareholders may participate in a meeting of the shareholders through remote communication by means of which all persons participating in the meeting can hear each other at the same time and participation through such communication shall constitute presence in person at such a meeting."

     SECTION 1107. Section 53-11-42 NMSA 1978 (being Laws 1967, Chapter 81, Section 41, as amended) is amended to read:

     "53-11-42. PLACE AND NOTICE OF DIRECTORS' MEETINGS--COMMITTEE MEETINGS.--Meetings of the board of directors, regular or special, or any committee designated thereby may be held either within or without [this state] New Mexico. Regular meetings of the board of directors or any committee designated thereby may be held with or without notice as prescribed in the bylaws. Special meetings of the board of directors or any committee designated thereby shall be held upon the notice prescribed in the bylaws. Attendance of a director at a meeting constitutes a waiver of notice of the meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the board of directors or any committee designated thereby need be specified in the notice or waiver of notice of the meeting unless required by the bylaws. Except as otherwise restricted by the articles of incorporation or bylaws, members of the board of directors or any committee designated thereby may participate in a meeting of the board or committee [by means of a conference telephone or similar communications equipment] through remote communication by means of which all persons participating in the meeting can hear each other at the same time, and participation [by such means] through such communication shall constitute presence in person at a meeting."

     SECTION 1108. Section 53-13-7 NMSA 1978 (being Laws 1975, Chapter 64, Section 32, as amended) is repealed and a new Section 53-13-7 NMSA 1978 is enacted to read:

     "53-13-7. [NEW MATERIAL] RESTATED ARTICLES OF INCORPORATION.--

          A. A corporation's board of directors may restate its articles of incorporation, as amended, at any time, with or without shareholder approval, to consolidate all amendments into a single document.

          B. If the restated articles of incorporation include one or more new amendments that require shareholder approval, the new amendments shall be adopted or approved as provided in Sections 53-13-2 and 53-13-3 NMSA 1978.

          C. A corporation that restates its articles of incorporation shall deliver to the secretary of state for filing the original and a copy of restated articles of incorporation setting forth the name of the corporation and the text of the restated articles of incorporation together with a certificate that:

                (1) states that the restated articles of incorporation consolidate all amendments into one document;

                (2) if one or more new amendments are included in the restated articles of incorporation, also includes the statements required by Subsections B, C, D, E and F of Section 53-13-4 NMSA 1978; and

                (3) states that the restated articles of incorporation superseded the original articles of incorporation and all previous amendments and restatements.

          D. The restated articles of incorporation shall be executed by the corporation by an authorized officer. The copy may be signed, photocopied or conformed. If the secretary of state finds that the restated articles of incorporation conform to law, the secretary of state shall, when all fees have been paid:

                (1) endorse on the original and a copy the word "filed" and the month, date and year of the filing;

                (2) file the original in the secretary of state's office; and

                (3) issue a restated certificate of incorporation to which the secretary of state shall affix the file-stamped copy.

          E. The restated certificate of incorporation, together with the file-stamped copy of the restated articles of incorporation affixed to it, shall be returned by the secretary of state to the corporation or its representative. Unless the secretary of state disapproves under Subsection A of Section 53-18-2 NMSA 1978, the restated articles of incorporation shall become effective upon delivery of the restated articles of incorporation to the secretary of state or on such later date, not more than thirty days after delivery of the restated articles of incorporation, to the secretary of state, as is provided for in the restated articles of incorporation. The restated articles of incorporation shall supersede the original articles of incorporation and all previous amendments and restatements.

          F. The secretary of state may certify restated articles of incorporation as the articles of incorporation currently in effect, without including the certificate information required by Subsection C of this section."

     SECTION 1109. Section 53-14-1 NMSA 1978 (being Laws 1967, Chapter 81, Section 68, as amended) is amended to read:

     "53-14-1. PROCEDURE FOR MERGER.--Any [two] one or more domestic corporations may [merge into] become a party to a merger with one [of the corporations] or more domestic entities pursuant to a plan of merger approved by each corporation in the manner provided in the Business Corporation Act and by each other type of entity, in the manner provided in the governing law of that type of entity. The board of directors of each corporation shall by resolution adopted by each such board approve a plan of merger setting forth:

          A. the [names of the corporations proposing to merge] name of each merging entity and the name of [the corporation into which they propose to merge, which is hereinafter designated as] the surviving [corporation] entity;

          B. [the] a summary of the principal terms and conditions of the proposed merger, including whether a surviving entity is to be created by the merger;

          C. the manner and basis of converting the [shares] interests of each [corporation] merging entity into [shares] interests, obligations or other securities of the surviving [corporation] entity, or of any other [corporation] entity, or, in whole or in part, into cash, [or] other property or rights to acquire interests or securities or any combination of the foregoing;

          D. if the surviving entity exists before the merger, a statement of any changes in the [articles of incorporation] organic record and private organic rules of the surviving [corporation] entity to be effected by the merger; [and]

          E. if the surviving entity is to be created by the merger, its proposed organic record and private organic rules;

          F. any other provision required by the governing law of a merging entity; and

          [E.] G. other provisions with respect to the proposed merger as deemed necessary or desirable."

     SECTION 1110. A new Section 53-14-1.1 NMSA 1978 is enacted to read:

     "53-14-1.1. [NEW MATERIAL] DEFINITIONS.--As used in Chapter 53, Article 14 NMSA 1978:

          A. "conversion" means a transaction pursuant to a plan of conversion approved pursuant to Section 53-14-2.1 NMSA 1978;

          B. "converted entity" means a converting entity as it continues in existence after a conversion;

          C. "converting entity" means an entity that approves a plan of conversion;

          D. "distributional interest" means the right under an entity's organic law and organic rules to receive distributions from the entity;

          E. "domestic", with respect to an entity, means governed as to the entity's internal affairs by the law of New Mexico;

          F. "domesticated corporation" means a domesticating corporation as it continues in existence after a domestication;

          G. "domesticating corporation" means a corporation that approves a plan of domestication;

          H. "domestication" means a transaction pursuant to a plan of domestication approved pursuant to Section 53-14-2.2 NMSA 1978;

          I. "entity" means:

                (1) a business corporation;

                (2) a limited partnership, including a limited liability limited partnership; or

                (3) a limited liability company;

          J. "foreign", with respect to an entity, means an entity governed as to its internal affairs by the law of a jurisdiction other than New Mexico;

          K. "governing law" means the law of an entity's jurisdiction of formation governing the internal affairs of the entity. "Governing law" includes:

                (1) the Business Corporation Act for corporations;

                (2) the Revised Uniform Limited Liability Company Act for limited liability companies; and

                (3) the Uniform Revised Limited Partnership Act for limited partnerships;

          L. "interest" means a:

                (1) share in a business corporation;

                (2) partnership interest in a limited partnership; and

                (3) membership interest in a limited liability company;

          M. "interest holder" means:

                (1) a shareholder of a business corporation;

                (2) a general partner of a limited partnership, including a limited liability limited partner thereof;

                (3) a limited partner of a limited partnership; or

                (4) a member of a limited liability company;

          N. "jurisdiction", when used to refer to a political entity, means the United States, a state, a foreign country or a political subdivision of a foreign country;

          O. "jurisdiction of formation" means the jurisdiction whose law governs the internal affairs of an entity;

          P. "merger" means a transaction pursuant to a plan of merger approved pursuant to Section 53-14-1 NMSA 1978;

          Q. "merging entity" means an entity that is a party to a merger and exists immediately before the merger becomes effective;

          R. "organic rules" means the public organic record and private organic rules of an entity;

          S. "person" means an individual, entity, business trust, estate, association, joint venture, government, governmental subdivision, agency, instrumentality or any other legal or commercial entity;

          T. "private organic rules" means the rules that govern the internal affairs of an entity and are not part of its public organic record. "Private organic rules" includes the:

                (1) bylaws of a business corporation;

                (2) partnership agreement of a limited partnership; and

                (3) operating agreement of a limited liability company;

          U. "public organic record" means the record the filing of which by the secretary of state is required to form an entity and any amendment to or restatement of that record. "Public organic record" includes the:

                (1) articles of incorporation of a business corporation;

                (2) certificate of limited partnership of a limited partnership; and

                (3) certificate of organization of a limited liability company;

          V. "registered foreign entity" means a foreign entity that is registered to do business in New Mexico under a record filed by the secretary of state. "Registered foreign entity" includes a:

                (1) registered foreign corporation;

                (2) registered foreign limited partnership; and

                (3) registered foreign limited liability company;

          W. "surviving entity" means an entity that continues in existence after or is created by a merger; and

          X. "type of entity" means a generic form of entity formed under a governing law."

     SECTION 1111. A new Section 53-14-2.1 NMSA 1978 is enacted to read:

     "53-14-2.1. [NEW MATERIAL] PROCEDURE FOR CONVERSION.--A domestic corporation may become a domestic limited liability company or limited partnership, and a domestic limited liability company or limited partnership may become a domestic corporation, in either case pursuant to a plan of conversion approved by the domestic corporation in the manner provided in the Business Corporation Act, by the domestic limited liability company in the manner provided in the Revised Uniform Limited Liability Company Act and by the domestic limited partnership in the manner provided in the Uniform Revised Limited Partnership Act. The board of directors of the corporation shall, by resolution adopted by the board, approve a plan conversion setting forth:

          A. the name of the converting entity and the converted entity;

          B. a summary of the terms and conditions of the proposed conversion;

          C. the manner and basis of converting shares or other interests in the converting entity into interests in the converted entity or the cash or other consideration to be paid or delivered as a result of the conversion of the shareholder's interests or a combination of these;

          D. the converted entity's proposed organic record and its proposed private organic rules;

          E. any other provision required by the governing law of a converting or converted entity; and

          F. other provisions with respect to the proposed conversion as deemed necessary or desirable."

     SECTION 1112. A new Section 53-14-2.2 NMSA 1978 is enacted to read:

     "53-14-2.2. [NEW MATERIAL] PROCEDURE FOR DOMESTICATION.--A domestic corporation may become a foreign corporation pursuant to a plan of domestication approved in the manner provided in the Business Corporation Act if the domestication is authorized by the laws of the foreign corporation's jurisdiction of formation. The board of directors of the domestic corporation shall, by resolution adopted by the board, approve a plan of domestication setting forth:

          A. the name of the domesticating corporation;

          B. the name and jurisdiction of formation of the domesticated corporation;

          C. a summary of the principal terms and conditions of the proposed domestication;

          D. the manner and basis of converting the shares of the domesticating corporation into the shares, obligations or other securities of the domesticated corporation or, in whole or in part, into cash or other property;

          E. the domesticated corporation's proposed articles of incorporation, however denominated, and its proposed bylaws, however denominated;

          F. an address where the secretary of state may send process served on the secretary of state as agent for the domesticated corporation arising out of business done in New Mexico by the domesticating corporation and the corporation's obligations under the plan of domestication and articles of domestication, including the rights of dissenting shareholders;

          G. any other provision required by the governing law of the domesticating or domesticated corporation; and

          H. other provisions with respect to the proposed domestication as deemed necessary or desirable."

     SECTION 1113. Section 53-14-3 NMSA 1978 (being Laws 1967, Chapter 81, Section 70, as amended) is amended to read:

     "53-14-3. APPROVAL BY SHAREHOLDERS.--

          A. The board of directors of each domestic corporation, [in the case of a] upon approving a plan of merger, [or] consolidation, [and the board of directors of the corporation the shares of which are to be acquired in the case of an exchange, upon approving a plan of merger, consolidation or] exchange, conversion or domestication, shall, by resolution, direct that the plan be submitted to a vote at a meeting of its shareholders, which may be either an annual or a special meeting. Written notice shall be given to each shareholder of record, whether or not entitled to vote at the meeting, not less than twenty days before the meeting, in the manner provided in the Business Corporation Act for the giving of notice of meetings of shareholders and, whether the meeting is an annual or a special meeting, shall state that the purpose or one of the purposes is to consider the proposed plan. A copy [or a summary] of the plan shall be included in or enclosed with the notice.

          B. At each meeting, a vote of the shareholders shall be taken on the proposed plan. The plan shall be approved upon receiving the affirmative vote of the holders of a majority of the shares entitled to vote thereon of each such corporation, unless any class of shares of any such corporation is entitled to vote thereon as a class, in which event, as to such corporation, the plan shall be approved upon receiving the affirmative vote of the holders of a majority of the shares of each class of shares entitled to vote thereon.

          C. Any class of shares of any such corporation shall be entitled to vote as a class if any such plan contains any provision [which] that, if contained in a proposed amendment to articles of incorporation, would entitle such class of shares to vote as a class and, in the case of an exchange, if the class is included in the exchange.

          D. A plan involving an entity that is not a corporation is not effective unless the plan approved by that entity is in accordance with its governing law.

          [C.] E. After such approval by a vote of the shareholders of each such corporation and at any time prior to the filing of the articles of merger, [or] consolidation, [or] exchange, conversion or domestication, the merger, [or] consolidation, [or] exchange, conversion or domestication may be abandoned pursuant to provisions therefor [if any] set forth in the plan. If the plan contains no provision for abandoning the plan but does not prohibit its abandonment, the plan may be abandoned in the same manner that the plan was approved.

          [D. (1)] F. Notwithstanding the provisions of Subsections [A and] B and C of this section, submission of a plan of merger to a vote at a meeting of shareholders of a surviving corporation shall not be required if:

                [(a)] (1) the articles of incorporation of the surviving corporation do not differ except in name from those of the corporation before the merger;

                [(b)] (2) each holder of shares of the surviving corporation [which] that were outstanding immediately before the effective date of the merger is to hold the same number of shares with identical rights immediately after;

                [(c)] (3) the number of voting shares outstanding immediately after the merger, plus the number of voting shares issuable on conversion of other securities issued by virtue of the terms of the merger and on exercise of rights and warrants so issued, will not exceed by more than twenty percent the number of voting shares outstanding immediately before the merger; and

                [(d)] (4) the number of participating shares outstanding immediately after the merger, plus the number of participating shares issuable on conversion of other securities issued by virtue of the terms of the merger and on exercise of rights and warrants so issued, will not exceed by more than twenty percent the number of participating shares outstanding immediately before the merger.

          [(2)] G. As used in [this] Subsection F of this section:

                [(a)] (1) "voting shares" means shares [which] that entitle their holders to vote unconditionally in election of directors; and

                [(b)] (2) "participating shares" means shares [which] that entitle their holders to participate without limitations in distribution of earnings or surplus."

     SECTION 1114. Section 53-14-4 NMSA 1978 (being Laws 1967, Chapter 81, Section 71, as amended) is amended to read:

     "53-14-4. ARTICLES OF MERGER, CONSOLIDATION, [OR] EXCHANGE, CONVERSION OR DOMESTICATION.--

          A. Upon receiving the approvals required by any of Sections 53-14-1, 53-14-2, 53-14-2.1 or 53-14-2.2 and by Section 53-14-3 NMSA 1978, articles of merger, [or articles of] consolidation, conversion or domestication shall be executed by each domestic corporation by an authorized officer and shall set forth:

                (1) the plan of merger, [or the plan of] consolidation, conversion or domestication;

                (2) as to each domestic merging, consolidating, converting or domesticating corporation, either:

                     (a) the number of shares outstanding and, if the shares of any class are entitled to vote as a class, the designation and number of outstanding shares of each such class; or

                     (b) a statement that the vote of shareholders is not required by virtue of Subsection [D] F of Section 53-14-3 NMSA 1978;

                (3) as to each domestic merging, consolidating, converting or domesticating corporation, the approval of whose shareholders is required:

                     (a) the number of shares required for approval if that number is different from a majority;

                     (b) the number of shares voted for and against the plan, respectively; and

                     (c) if the shares of any class are entitled to vote as a class, the number of shares of each such class required for approval if that number is different from a majority and the number of shares of each such class voted for and against the plan, respectively; and

                (4) as to the domestic acquiring corporation in a plan of exchange, a statement that the adoption plan and performance of its terms were duly approved by its board of directors and such other requisite corporate action, if any, as may be required of it.

          B. The original of the articles of merger, consolidation, [or] exchange, conversion or domestication, together with a copy, which may be signed, photocopied or conformed, shall be delivered to the [commission] secretary of state. If a domestic limited liability company or a domestic limited partnership is a party to the merger or conversion, the statement of merger or statement of conversion required by the Revised Uniform Limited Liability Company Act or the articles of merger or articles of conversion required by the Uniform Revised Limited Partnership Act shall be delivered to the secretary of state. If the [commission] secretary of state finds that the articles and statements conform to law, [it] the secretary of state shall, when all fees have been paid:

                (1) endorse on the original and copy the word "filed" and the month, day and year of the filing;

                (2) file the original in [its] the secretary of state's office; and

                (3) issue a certificate of merger, consolidation, [or] exchange, conversion or domestication to which [it] the secretary of state shall affix the file-stamped copy.

          C. The certificate of merger, consolidation, [or] exchange, conversion or domestication, together with the file-stamped copy of the articles affixed to it, shall be returned by the [commission] secretary of state to [the] each surviving, new, [or] acquiring [corporation] or domesticated entity or [its] to the entity's representative."

     SECTION 1115. Section 53-14-6 NMSA 1978 (being Laws 1967, Chapter 81, Section 73, as amended) is amended to read:

     "53-14-6. EFFECT OF MERGER, CONSOLIDATION, [OR] EXCHANGE, CONVERSION OR DOMESTICATION.--

          A. Unless the [commission] secretary of state disapproves pursuant to Subsection A of Section 53-18-2 NMSA 1978, a merger, consolidation, [or] exchange, domestication or conversion shall become effective upon delivery of the articles of merger, consolidation, [or] exchange, domestication or conversion, and delivery of any statement of merger or statement of conversion required by the Revised Uniform Limited Liability Company Act and articles of merger or articles of conversion required by the Uniform Revised Limited Partnership Act, to the [commission] secretary of state or on such later date, not more than thirty days [subsequent to] after the delivery thereof to the [commission] secretary of state, as shall be provided for in the plan.

          B. When a merger, [or] consolidation, conversion or domestication has become effective:

                [A.] (1) the several [corporations] entities that are parties to the plan of merger or consolidation shall be [a single corporation] the single entity, which, in the case of a merger, shall be [that corporation] the entity designated in the plan of merger as the surviving [corporation] entity and, in the case of a consolidation, shall be the new [corporation] entity provided for in the plan of consolidation, and the surviving entity or the new entity shall be the same entity without interruption as the merging entities or the consolidating entities provided for in the plan of merger or plan of consolidation;

                (2) the converted corporation, limited liability company or limited partnership that is party to the plan of conversion shall be the same entity without interruption as any converting corporation, limited liability company or limited partnership provided for in the plan of conversion;

                (3) the domesticated corporation that is party to the plan of domestication shall be subject to the laws of the state under which it is domesticated and shall be the same corporation without interruption as the domesticating corporation provided for in the plan of domestication;

                [B.] (4) the separate existence of all [corporations] entities that are parties to the plan of merger, conversion, domestication or consolidation, except the surviving, converted, domesticated or new [corporation] entity, shall cease;

                [C.] (5) the surviving [or] entity, new [corporation] entity or converted entity shall have all the rights, privileges, immunities and powers and shall be subject to all the duties and liabilities of a corporation organized under the Business Corporation Act, a limited liability company organized under the Revised Uniform Limited Liability Company Act or a limited partnership organized under the Uniform Revised Limited Partnership Act, as the case may be. The domesticated corporation shall have all the rights, privileges, immunities and powers, and shall be subject to all the duties and liabilities, of a corporation domesticated under the laws of the state under which it is domesticated;

                [D.] (6) the surviving, [or] new [corporation], converted or domesticated entity shall thereupon possess all the rights, privileges, immunities and franchises of a public or private nature of each of the merging, [or] consolidating [corporations], converting or domesticating entities; and all property, real, personal and mixed and all debts due on whatever account, including subscriptions to shares, and all other choses in action and every other interest of, or belonging to, or due to, each of the [corporations] entities so merged, [or] consolidated, converted or domesticated shall be taken and deemed to be [transferred to and] vested in [such single corporation] each of the surviving, new, converted or domesticated entities without transfer or further act or deed, and the title to any real estate, or any interest therein, vested in any of such corporations, limited liability companies or limited partnerships shall not revert or be in any way impaired by reason of the merger, [or] consolidation, conversion or domestication;

                [E.] (7) the surviving, [or] new [corporation], converted or domesticated entity shall thenceforth be responsible and liable for all the liabilities and obligations of each of the [corporations] entities so merged, [or] consolidated, converted or domesticated, and any claim existing or action or proceeding pending by or against any of such [corporations] entities may be prosecuted as if the merger, conversion, domestication or consolidation had not taken place, or the surviving, [or] new [corporation], converted or domesticated entity may be substituted in its place. Neither the rights of creditors nor any liens upon the property of any such [corporation] entity shall be impaired by the merger, [or] consolidation, conversion or domestication. A merger, consolidation, conversion or domestication does not constitute or cause the dissolution of any such merging, consolidating, domesticating or converting corporation or the winding up of the affairs or dissolution of any such merging, domesticating or converting limited liability company or limited partnership;

                [F.] (8) in the case of a merger, the articles of incorporation of the surviving corporation shall be deemed to be amended to the extent, if any, that changes in its articles of incorporation are stated in the plan of merger, and, in the case of a consolidation, the statements set forth in the articles of consolidation and [which] that are required or permitted to be set forth in the articles of incorporation of corporations organized under the Business Corporation Act shall be deemed to be the original articles of incorporation of the new corporation; [and

                G.] (9) when a merger, consolidation, [or] exchange, conversion or domestication has become effective, the shares of the corporation or corporations party to the plan that are, under the terms of the plan, to be converted, domesticated or exchanged shall cease to exist, in the case of a merger or consolidation, or be deemed to be exchanged, in the case of an exchange, and the holders of such shares shall thereafter be entitled only to the shares, obligations, other securities, cash or other property into which they shall have been converted or for which they shall have been exchanged, in accordance with the plan, subject to any rights under Section 53-14-4 NMSA 1978 and, in the case of a domestication, the holders of shares of the domesticating corporation shall thereafter be entitled only to the shares, obligations, other securities, cash or other property that is provided for in the plan of domestication, subject to any rights under the law of the state where the corporation is domesticated; and

                (10) when a domestication has become effective, if the domesticated corporation is a foreign corporation and if it is to transact business in New Mexico, it shall comply with the provisions of the Business Corporation Act with respect to foreign corporations, and in every case it shall file with the secretary of state:

                     (a) an agreement that the domesticating corporation may be served with process in New Mexico in any proceeding for the enforcement of any obligation of the corporation and in any proceeding for the enforcement of the rights of a dissenting shareholder in connection with the domestication;

                     (b) an irrevocable appointment of the secretary of state as the corporation's agent to accept service of process in any such proceeding; and

                     (c) an agreement that the corporation will promptly pay to such dissenting shareholders of any such domesticating corporation the amount, if any, to which they are entitled under the Business Corporation Act with respect to the rights of dissenting shareholders."

     SECTION 1116. Section 53-14-7 NMSA 1978 (being Laws 1967, Chapter 81, Section 74, as amended) is amended to read:

     "53-14-7. MERGER, CONSOLIDATION, [OR] EXCHANGE OF SHARES OR CONVERSION BETWEEN DOMESTIC AND FOREIGN CORPORATIONS, LIMITED LIABILITY COMPANIES AND LIMITED PARTNERSHIPS--DOMESTICATION BY FOREIGN CORPORATIONS INTO DOMESTIC CORPORATIONS.--

          A. One or more foreign corporations and one or more domestic corporations may become parties to a merger or consolidation [be merged or consolidated or participate in an exchange in the following manner, if] with a foreign entity that is a corporation or a different type of entity, a foreign entity may be converted into a domestic entity and a domestic corporation may be converted into a foreign entity that is a corporation or a different type of entity and a foreign corporation may become a New Mexico corporation by domestication if, in any of those cases, the merger, consolidation, [or] exchange, conversion or domestication is permitted by the laws of the [state] jurisdiction under which each foreign [corporation] entity is organized and if:

                (1) each domestic corporation [shall comply] complies with the provisions of the Business Corporation Act with respect to the merger, consolidation, [or] exchange, conversion or domestication, as the case may be, of domestic corporations, any other domestic entity that is not a corporation complies with the provisions of its governing law with respect to the merger or consolidation, as the case may be, and each foreign [corporation, shall comply] entity complies with the applicable provisions of the laws of the [state] jurisdiction under which it is [organized] formed; and

                (2) [if] in the case in which the surviving, [or] new, domesticated or converted corporation or other type of entity in a merger, [or] consolidation, domestication or conversion is to be governed by the laws of any [state] jurisdiction other than [this state it shall comply] New Mexico, the corporation shall not transact business in New Mexico until the entity complies with the provisions of the [Business Corporation Act] laws of New Mexico with respect to foreign [corporations if it is to transact business in this state, and in every case it shall file] entities and it files with the [commission] secretary of state:

                     (a) an agreement that it may be served with process in [this state] New Mexico in any proceeding for the enforcement of any obligation of any domestic corporation [which] that is a party to the merger, [or] consolidation, domestication or conversion and in any proceeding for the enforcement of the rights of a dissenting shareholder or other interest holder of any such domestic [corporation] entity against the surviving, [or] new [corporation] domesticated or converted entity;

                     (b) an irrevocable appointment of the secretary of state as its agent to accept service of process in any such proceeding; and

                     (c) an agreement that it will promptly pay to the dissenting shareholders of any such domestic corporation the amount, if any, to which [they] it shall be entitled under the provisions of the Business Corporation Act with respect to the rights of dissenting shareholders.

          B. The effect of such merger, [or] consolidation or conversion shall be the same as in the case of the merger, [or] consolidation or conversion of domestic [corporations] entities if the surviving, [or] new [corporation] or converted entity is to be governed by the laws of [this state] New Mexico. The effect of such domestication shall be the same as the domestication of domestic entities if the domesticated entity is to be governed by the laws of New Mexico, except that the domesticated entity shall be governed by the laws of New Mexico and the holders of the shares and other holders of interests in the domesticating entity shall thereafter be entitled only to the shares, obligations, other securities, cash or other property that is provided in the plan of domestication, subject to any rights under the laws of New Mexico. If the surviving, [or] new, [corporation] domesticated or converted entity is to be governed by the laws of any [state] jurisdiction other than [this state] New Mexico, the effect of such merger, [or] consolidation, domestication or conversion shall be [the same as in the case of the merger, or consolidation of domestic corporations except insofar as the laws of such other state provide otherwise] governed by the laws of the other jurisdiction.

          C. At any time prior to the filing of the articles of merger, [or] consolidation, conversion or domestication, the merger, [or] consolidation, conversion or domestication may be abandoned pursuant to provisions therefor [if any] set forth in the plan of merger, [or] consolidation, conversion or domestication. If the plan contains no provision for abandoning the plan but does not prohibit its abandonment, the plan may be abandoned in the same manner that the plan was approved."

     SECTION 1117. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2024.

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