A. Except as provided in the articles of organization or an operating agreement:

(1) a membership interest or a limited liability company interest is assignable in whole or in part;

(2) until the assignee becomes a member in accordance with the provisions of Subsection A of Section 33 [53-19-33 NMSA 1978] of the Limited Liability Company Act, an assignment entitles the assignee to receive only the distributions and return of capital to which the assignor would be entitled with respect to the interest he assigned if he had not assigned such interest;

(3) an assignment does not of itself dissolve the limited liability company;

(4) until the assignee of a membership interest becomes a member, the assignor continues to be a member and to have the power to exercise all rights of a member, subject to the provisions of Paragraph (2) of this subsection and the members' right to remove the assignor pursuant to Subparagraph (b) of Paragraph (3) of Subsection A of Section 38 [53-19-38 NMSA 1978] of the Limited Liability Company Act;

(5) until the assignee of a membership interest becomes a member, the assignee has no liability of a member solely as a result of the assignment; and

(6) the assignor is not released from any liability that he may have as a member solely as a result of his assignment.

B. Unless otherwise provided by the articles of organization or an operating agreement, the pledge or granting of a security interest, lien or other encumbrance in or against all or any portion of the interest of a member is not an assignment and shall not cause the member to cease to be a member or to cease to have the power to exercise any rights or powers of a member.

History: Laws 1993, ch. 280, § 32.