New Mexico LLC Operating Agreement
The New Mexico LLC operating agreement is a legal document that can outline responsibilities within a newly established LLC such as managerial duties, voting rights, allocation of resources, and many other standards that can be set and agreed upon by the owners and members. This is a recommended step to take but is not required by New Mexico law.
From NM Stat § 53-19-2 (2019):
“Operating agreement” means the agreement, whether or not referred to as an operating agreement and whether 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 11 of this act. The term includes the agreement as amended or restated.
New Mexico Operating Agreement Law
A. A limited liability company shall keep at its principal place of business, and notify all of its members of the location of such place, the following:
(1) a list containing the full name and last known mailing address of all current and former members and managers;
(2) a copy of the articles of organization and all amendments or restatements of the articles, together with executed copies of any powers of attorney pursuant to which any articles, amendments or restatements have been executed;
(3) a copy of each of the limited liability company’s federal, state and local income tax returns and financial statements for the three most recent years or, if such returns or statements were not prepared for any reason, copies of the information and statements necessary to enable the members to prepare their own federal, state and local tax returns for such periods;
(4) a copy of every current and prior operating agreement, and every amendment to each of those operating agreements;
(5) unless the following statements are included in the articles of organization or an operating agreement:
(a) a current statement of the capital contributions made by each member specifying the amount of cash and the agreed value of other property received by the limited liability company and the agreed value of services as a capital contribution that each member has rendered to the limited liability company;
(b) a statement of the cash, property and services that each member has agreed to contribute or render to the limited liability company in the future, and of the principal balance outstanding under any promissory note payable in respect of a capital contribution, and of the amount of the capital contribution with which each such member shall be credited upon receipt of such cash, property or services, or any part thereof, by the limited liability company; and
(c) a statement of the times at which, or the events on the happening of which, any additional contributions to or withdrawals from capital to which the members have agreed are to occur; and
(6) documents or any other writings required to be made available to members by the articles of organization or operating agreement.
B. A member or his representative may, at the member’s expense, inspect and copy any limited liability company record, wherever such record is located, upon reasonable request during ordinary business hours.
C. Managers or members in whom the articles of organization or an operating agreement vest a particular management responsibility for one or more material matters shall, if requested by a member, the personal representative of a deceased member or the legal representative of a member under a legal disability, render to that member or representative, to the extent the circumstances render it reasonable to do so, true and full information on all such material matters affecting the requesting member in his capacity as a member.
D. Failure of the limited liability company to keep or maintain any of the records or information required pursuant to this section shall not be grounds for imposing liability on any person for the debts and obligations of the limited liability company.
Forming an LLC in New Mexico
- Conduct a name search
- Choose a registered agent
- File formation articles
- Draft an operating agreement
Step 1: Conduct a Name Search
The laws set by the state of New Mexico require that the LLC name must fit certain criteria to be established in New Mexico.
The name must include one of:
- Limited Liability Company
- Std. Liability Co.
The name must be distinguishable from all other businesses in the state. The title may not include “corp”, “inc”, or other designators or government names or acronyms.
Some professional LLCs like banks, attorneys, and other professional applications may require additional verification and a licensed practitioner to be part of the formation.
You can conduct a name search on the New Mexico Business Name Database.
Step 2: Choose Your Registered Agent
To establish your LLC within New Mexico, you’ll have to designate a registered agent. The registered agent is someone who will be responsible for receiving service of process.
Individual agents must
- Be 18 years or older
- Be a resident of the state
- Have a physical (not a P.O. Box) address in New Mexico
When using a registered agent service, the agent must be authorized to do business in New Mexico.
Step 3: File Your Formation Articles
The articles you are going to file will depend on whether the business is new (domestic) or already exists out-of-state (foreign).
Domestic LLC formations require you to file Articles of Organization with the Secretary of State’s office. This must be done online.
Online Filing (Domestic):
- $50 filing fee
- Turnaround time: 1-3 business days
- Create an account and submit online
Foreign LLCs expanding to New Mexico must file a Certificate of Registration. This is done by mail.
Mailed Filing (Foreign):
- $100 filing fee
- Turnaround time: 3-5 business days
- Select Application for Registration, complete the form online or after printing and mail to:
New Mexico Secretary of State
Business Services Division
325 Don Gaspar, Suite 300
Santa Fe, NM 87501
Step 4: Draft a New Mexico Operating Agreement
In New Mexico it is not required but is recommended that you create an operating agreement for your LLC. This gives you the opportunity to set forth plans that must be followed such as the rights and responsibilities of members and managers and distribution of profits and losses. It also provides precedence for settling legal disputes between members.
It is recommended that every member of the operating agreement keeps a copy of their own, and an alternate company copy be kept. It does not need to be filed with the state.