N.M. Code R. § 12.11.12.17

Current through Register Vol. 35, No. 11, June 11, 2024

Section 12.11.12.17 - SECTION 58-13C-203 - TRANSACTIONS INVOLVING SECURITIES OF AN INVESTMENT CLUB

By authority delegated to the director in Section 58-13C-203 to promulgate rules, the issuance of securities by an investment club shall be exempt from Section 58-13C-301 provided that:

A. the membership is limited to not more than 75 members and provided that a husband and wife may be counted as one member;

B. periodic contributions are equal;

C. if a licensed or registered broker-dealer or investment adviser or employee of such broker-dealer or investment adviser is an organizer or member, such relationship is fully disclosed to the director;

D. the management of the funds of the club is not in the hands of a licensed or registered broker-dealer or investment adviser or employee of such broker-dealer or investment adviser;

E. securities in which the club invests are not bought on margin nor is any money borrowed or assets pledged;

F. unanimous consent of the members is required for any major investment policy change;

G. no member receives any fee or remuneration for services in the operation of the club except for administrative services; the members of the board of directors may be given token remuneration for their services on the board provided that such remuneration has been approved by majority vote of the membership;

H. the books of the club shall be open for inspection by members at any reasonable time;

I. memberships in the club are nontransferable;

J. the articles of incorporation or other organizational documents provide that club members may withdraw from the club and that, upon such withdrawal, the club will pay a pro rata share of the club's net asset value to such member; memberships that have been forfeited, repurchased by or otherwise returned to the club shall not be subject to resale;

K. the monthly payment by each member is not in excess of $50.00 dollars per month; and

L. the initial payment for entry into the club does not exceed $250.00 per membership.

N.M. Code R. § 12.11.12.17

12.11.12.17 NMAC - Rp, 12.11.11.18 NMAC, 1-1-2010