§ 681. Definitions. 1. "Advertisement" includes any written or printed\ncommunication, or any communication by means of recorded telephone\nmessages or spoken on radio, television, or similar communications\nmedia, published in connection with an offer or sale of a franchise.\n 2. "Department" means the department of law.\n 3. "Franchise" means a contract or agreement, either expressed or\nimplied, whether oral or written, between two or more persons by which:\n (a) A franchisee is granted the right to engage in the business of\noffering, selling, or distributing goods or services under a marketing\nplan or system prescribed in substantial part by a franchisor, and the\nfranchisee is required to pay, directly or indirectly, a franchise fee,\nor\n (b) A franchisee is granted the right to engage in the business of\noffering, selling, or distributing goods or services substantially\nassociated with the franchisor's trademark, service mark, trade name,\nlogotype, advertising, or other commercial symbol designating the\nfranchisor or its affiliate, and the franchisee is required to pay,\ndirectly or indirectly, a franchise fee.\n A franchise under this article shall not include any agreement,\ncontract, or franchise subject to the provisions of article eleven-B of\nthis chapter or section one hundred ninety-nine of this chapter, or any\nagreement or contract for the sale of motor fuel.\n 4. A "franchisee" is a person to whom a franchise is granted.\n 5. A "franchisor" is a person who grants a franchise.\n 6. "Area franchise" means a contract or agreement between a franchisor\nand a subfranchisor whereby the subfranchisor is granted the right, for\nconsideration given in whole or in part for such right, to sell or\nnegotiate the sale of franchises in the name or on behalf of the\nfranchisor; unless specifically stated otherwise, "franchise" includes\n"area franchise".\n 7. "Franchise fee" means any fee or charge that a franchisee or\nsubfranchisor is required to pay or agrees to pay directly or indirectly\nfor the right to enter into a business under a franchise agreement or\notherwise sell, resell or distribute goods, services, or franchises\nunder such an agreement, including, but not limited to, any such payment\nfor goods or services. The following are not the payment of a franchise\nfee:\n (a) The purchase or agreement to purchase goods at a bona fide\nwholesale price;\n (b) The payment of a reasonable service charge to the issuer of a\ncredit card by an establishment accepting or honoring such credit card;\n (c) Amounts paid to a trading stamp company by a person issuing\ntrading stamps in connection with the retail sale of merchandise or\nservices;\n (d) The purchase or lease, at fair market value, of real property or\nagreement to so purchase or lease real property necessary to enter into\nthe business or to continue the business under the franchise agreement;\n (e) The payment of a fee which on an annual basis does not exceed five\nhundred dollars where the payor receives sales materials of an\nequivalent or greater value than his payment;\n (f) The purchase of sales demonstration equipment and materials\nfurnished at cost for use in making sales and not for resale;\n (g) A lease, license or other agreement by a retailer permitting the\nlessee, licensee or beneficiary to offer, sell or distribute goods or\nservices on or about the premises occupied by said retailer.\n 8. "Franchise sales agent" means a person who directly or indirectly\nengages in the offer or sale of any franchise on behalf of another.\nFranchisors, subfranchisors, and their employees are not to be\nconsidered franchise sales agents.\n 9. "Franchise salesman" means each and every person employed by a\nfranchisor or franchise sales agent for the purpose of representing such\nfranchisor or franchise sales agent in the offer or sale of any\nfranchise.\n 10. "Fraud," "fraudulent practice," and "deceit" are not limited to\ncommon law fraud or
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