2006 New Mexico Statutes - 58-13B-2 — Definitions.

58-13B-2. Definitions.

As used in the New Mexico Securities Act of 1986 [ 58-13B-1 NMSA 1978]:   

A.     "affiliate" means a person who directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with another person;   

B.     "broker-dealer" means a person engaged in the business of effecting transactions in securities for the account of others or for the person's own account. Broker-dealer does not include:   

(1)     a sales representative;   

(2)     an issuer, except when effecting transactions other than with respect to its own securities;   

(3)     a depository institution when acting on its own account or when exercising trust or fiduciary powers permitted for a depository institution pursuant to applicable state or federal laws and regulations providing for the organization, operation, supervision and examination of the depository institution; or   

(4)     any other person as the director by rule or order designates;   

C.     "control person" means an officer, director, managing partner or trustee, manager of a limited liability company or person of similar status or function or any security holder who owns beneficially or of record ten percent or more of any class of securities of an issuer;   

D.     "depository institution":   

(1)     means:   

(a)     a person that is organized, chartered or holding an authorization certificate under the laws of a state or of the United States that authorizes the person to receive deposits, including a savings, share, certificate or deposit account, is regulated, supervised and examined for the protection of depositors by an official or agency of a state or the United States and is insured by the federal depository insurance corporation, the federal savings and loan insurance corporation or the national credit union share insurance fund; and   

(b)     a trust company or other institution that is authorized by federal or state law to exercise fiduciary powers of the type a national bank is permitted to exercise under the authority of the comptroller of the currency and is regulated, supervised and examined by an official or agency of a state or the United States; and   

(2)     does not include an insurance company or other organization primarily engaged in the insurance business or a Morris plan bank, industrial loan company or a similar bank or company;   

E.     "director" means the director of the securities division of the regulation and licensing department;   

F.     "division" means the securities division of the regulation and licensing department;   

G.     "federal covered security" means any security described as a "covered security" in the federal Securities Act of 1933;   

H.     "filed" means the receipt of a document or application by the director or by the authorized representative of the director at the principal office of the director;   

I.     "financial or institutional investor" means any of the following, whether acting for itself or others in a fiduciary capacity, other than as an agent:   

(1)     a depository institution;   

(2)     an insurance company;   

(3)     a separate account of an insurance company;   

(4)     an investment company as defined in the Investment Company Act of 1940;   

(5)     an employee pension, profit-sharing or benefit plan, if:   

(a)     the plan has total assets in excess of five million dollars ($5,000,000); or   

(b)     investment decisions are made by a plan fiduciary, as defined in the Employee Retirement Income Security Act of 1974, that is either a broker-dealer registered under the Securities Exchange Act of 1934, an investment adviser registered or exempt from registration under the Investment Advisers Act of 1940, a depository institution or an insurance company;   

(6)     a business development company as defined by the Investment Company Act of 1940;   

(7)     a small business investment company licensed by the United States small business administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; or   

(8)     any other financial or institutional investor as the director by rule or order designates;   

J.     "fraud", "deceit" and "defraud" are not limited to common-law fraud or deceit;   

K.     "guaranteed" means guaranteed as to payment of principal, interest and dividends;   

L.     "insured" means insured as to payment of principal, interest and dividends;   

M.     "investment adviser":   

(1)     means a person who, for compensation, engages in the business of advising others as to the value of securities or as to the advisability of investing in, purchasing or selling securities, or who, for compensation and as a part of a regular business, issues or promulgates analyses or reports concerning securities; and   

(2)     does not include:   

(a)     an investment adviser representative;   

(b)     a depository institution when acting on its own account or when exercising trust or fiduciary powers permitted for such depository institutions under applicable state or federal laws and regulations providing for the organization, operation, supervision and examination of such depository institution;   

(c)     a lawyer, accountant, engineer or teacher whose performance of these services is solely incidental to the practice of the person's profession;   

(d)     a broker-dealer whose performance of the investment advisory services is solely incidental to the conduct of business as a broker-dealer and who receives no special compensation for the investment advisory services;   

(e)     a publisher, employee or columnist of a newspaper, news magazine or business or financial publication, or an owner, operator, producer or employee of a cable, radio or television network, station or production facility if, in either case, the financial or business news published or disseminated is made available to the general public and the content does not consist of rendering advice on the basis of the specific investment situation of each client; or   

(f)     any other person as the director by rule or order designates;   

N.     "investment adviser representative" means:   

(1)     with respect to an investment adviser that is registered or required to register pursuant to the New Mexico Securities Act of 1986 [ 58-13B-1 NMSA 1978], a natural person other than an investment adviser who, whether as an employee or in the form of a professional corporation is under the direct supervision of an investment adviser and engages in the business of advising others as to the value of securities or about the advisability of investing in, purchasing or selling securities, or who, for compensation and as part of a regular business, issues or promulgates analyses or reports concerning securities; or   

(2)     with respect to an investment adviser registered with the United States securities and exchange commission, an "investment adviser representative" who has a "place of business" in the state as those terms are defined by rule pursuant to Section 203 of the Investment Advisers Act of 1940;   

O.     "issuer" means a person that issues or proposes to issue a security, except that:   

(1)     in respect to the issuer of a collateral trust certificate, voting trust certificate, certificate of deposit for a security or share in an investment company without a board of directors or persons performing similar functions, "issuer" means the person or persons performing the acts and assuming the duties of depositor or manager pursuant to the provisions of the trust or other agreement or instrument under which the security is issued;   

(2)     in respect to the issuer of an equipment trust certificate, including a conditional sales contract, or similar security serving the same purpose, "issuer" means the person to whom the equipment or property is or is to be leased or conditionally sold; and   

(3)     in respect to the issuer of an interest in oil, gas or other mineral rights "issuer" means the owner of an interest in such a right, whether whole or fractional, who creates interests for the purposes of sale;   

P.     "non-issuer transaction" means a transaction not directly or indirectly for the benefit of the issuer;   

Q.     "person" means a legal entity;   

R.     "price amendment" means the amendment to a registration statement filed under the Securities Act of 1933 or, if no amendment is filed, the prospectus or prospectus supplement filed under the Securities Act of 1933, that includes a statement of the offering price, underwriting and selling discounts or commissions, amount of proceeds, conversion rates, call prices and other matters dependent upon the offering price;   

S.     "promoter" includes:   

(1)     a person who, acting alone or in concert with one or more other persons, takes the entrepreneurial initiative in founding or organizing the business or enterprise of an issuer;   

(2)     an officer or director or person of similar status or function owning any securities of an issuer or any security holder who owns, beneficially or of record, ten percent or more of any class of securities of the issuer if the officer, director, person of similar status or security holder acquires any of those securities in a transaction which does not possess the indicia of arm's-length bargaining or which is otherwise unfair to the issuer; or   

(3)     a member of the immediate family of a person described in Paragraph (1) or (2) of this subsection if the family member received the securities in a transaction that does not possess the indicia of arm's-length bargaining or which is otherwise unfair to the issuer;   

T.     the following words and phrases have the indicated meanings:   

(1)     "sale" or "sell" includes every contract of sale, contract to sell or other disposition of a security or interest in a security for value;   

(2)     "offer to sell" includes every attempt or offer to dispose of, or solicitation of an offer to purchase, a security or interest in a security for value;   

(3)     "offer to purchase" includes every attempt or offer to obtain, or solicitation of an offer to sell, a security or interest in a security for value;   

(4)     a security given or delivered with, or as a bonus on account of, a purchase of securities or other item is considered to constitute part of the subject of the purchase and to have been offered and sold for value;   

(5)     a gift of assessable stock is deemed to involve an offer and sale; and   

(6)     a sale or offer of a warrant or right to purchase or subscribe to another security of the same or another issuer, or a sale or offer of a security that gives the holder a present or future right or privilege to convert into another security of the same or another issuer, is deemed to include an offer of the other security;   

U.     the terms defined in Subsection T of this section do not include the creation of security interest or a loan of a security; a stock dividend, whether the corporation distributing the dividend is the issuer of the stock or not, if nothing of value is given by stockholders for the dividend other than the surrender of a right to a cash or property dividend and each stockholder may elect to take the dividend in cash, property or stock; or an act incident to a judicially approved reorganization in which a security is issued in exchange for one or more outstanding securities, claims or property interests, or partly in exchange and partly for cash, but the terms contained in this subsection are within the meaning of Subsection T of this section for the purpose of Section 58-13B-30 NMSA 1978;   

V.     "sales representative" means an individual other than a broker-dealer, whether as an employee or in the form of a professional corporation, authorized to act and acting for a broker-dealer or issuer in effecting or attempting to effect purchases or sales of securities. A partner, officer or director of a broker-dealer or issuer, or a person occupying a similar status or performing similar functions, is a sales representative only if that person otherwise comes within the definition;   

W.     "Securities Act of 1933", "Securities Exchange Act of 1934", "Public Utility Holding Company Act of 1935", "Investment Company Act of 1940", "Investment Advisers Act of 1940", "Employee Retirement Income Security Act of 1974", "National Housing Act" and "Commodity Exchange Act" mean the federal statutes of those names as amended before or after the effective date of the New Mexico Securities Act of 1986 [ 58-13B-1 NMSA 1978];   

X.     unless the context requires otherwise, "security" means a note; stock; treasury stock; bond; debenture; evidence of indebtedness; certificate of interest or participation in any profit-sharing agreement; any limited partnership interest; any interest in a limited liability company; collateral-trust certificate; preorganization certificate or subscription; transferable share; investment contract; voting-trust certificate; certificate of deposit for a security; any interest in oil, gas or other mineral rights; any put, call, straddle or option entered into on a national securities exchange relating to foreign currency; any put, call, straddle or option on any security, certificate of deposit or group or index of securities, including any interest therein or based on the value thereof; or, in general, any interest or instrument commonly known as a security or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of or warrant or right to subscribe to or purchase any of the foregoing. "Security" does not include landowner royalties in the production of oil, gas or other minerals created through the execution of a lease of the lessor's mineral interest;   

Y.     "self-regulatory organization" means a national securities exchange registered under Section 6 of the Securities Exchange Act of 1934, a national securities association of brokers and dealers registered under Section 15A of the Securities Exchange Act of 1934, a clearing agency registered under Section 17A of that act and the municipal securities rulemaking board established under Section 15B(b)(1) of that act;   

Z.     "state" means a state, commonwealth, territory or possession of the United States, the District of Columbia and the commonwealth of Puerto Rico; and   

AA.     "underwriter" means any person who has purchased from an issuer with the intent to offer or sell a security or to distribute any security, or participates or has a direct or indirect participation in any [sic] the undertaking, or participates or has a participation in the direct or indirect underwriting of any [sic] the undertaking; but the term does not include a person whose interest is limited to a commission from an underwriter or dealer not in excess of the usual and customary distributors' or sellers' commission. As used in this subsection, the term "issuer" includes, in addition to an issuer, any person directly or indirectly controlling or controlled by the issuer, or any person under direct or indirect common control with the issuer.