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3119
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MARVIN MANDEL, Governor
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(E) A "FRANCHISEE" IS A PERSON TO WHOM A FRANCHISE
OR DISTRIBUTORSHIP IS GRANTED. REFERENCE IN. THIS
SUBTITLE TO "FRANCHISEE" INCLUDES DISTRIBUTEE.
(F) A "FRANCHISOR" IS A PERSON WHO GRANTS A
FRANCHISE.
(G) "AREA FRANCHISE" MEANS ANY CONTRACT OR
AGREEMENT BETWEEN A FRANCHISOR AND A SUBFRANCHISOR
WHEREBY THE SUBFRANCHISOR IS GRANTED THE RIGHT, FOR
CONSIDERATION GIVEN IN WHOLE OR IN PART FOR THIS RIGHT,
TO SELL OR NEGOTIATE THE SALE OF FRANCHISES IN THE NAME
OR ON BEHALF OF THE FRANCHISOR.
(H) "FRANCHISE", UNLESS SPECIFICALLY STATED
OTHERWISE, INCLUDES AREA FRANCHISE.
(I) A "SUBFRANCHISOR" IS A PERSON TO WHOM AN AREA
FRANCHISE OR DISTRIBUTORSHIP IS GRANTED.
(J) "FRANCHISE FEE" MEANS ANY FEE OR CHARGE THAT A
FRANCHISEE OR SUBFRANCHISOR IS REQUIRED TO PAY OR AGREES
TO PAY FOR THE RIGHT TO ENTER INTO A BUSINESS UNDER A
FRANCHISE AGREEMENT, INCLUDING, BUT NOT LIMITED TO, ANY
PAYMENT FOR GOODS AND SERVICES. HOWEVER, THE FOLLOWING
ARE NOT TO BE CONSIDERED THE PAYMENT OF A FRANCHISE FEE:
(1) THE PURCHASE OR AGREEMENT TO PURCHASE
GOODS AT A BONA FIDE WHOLESALE PRICE; OR
(2) THE PAYMENT OF A REASONABLE SERVICE
CHARGE TO THE ISSUER OF A CREDIT CARD BY AN ESTABLISHMENT
ACCEPTING OR HONORING THE CREDIT CARD;
(3) AMOUNTS PAID TO A TRADING STAMP COMPANY
LICENSED IN THIS STATE BY A PERSON ISSUING TRADING STAMPS
IN CONNECTION WITH THE RETAIL SALE OF MERCHANDISE OR
SERVICE;
(4) THE PURCHASE OF GOODS OR AGREEMENT TO
PURCHASE GOODS ON CONSIGNMENT, IF THE PROCEEDS REMITTED
BY THE FRANCHISEE FROM THE SALE REFLECT ONLY THE BONA
FIDE WHOLESALE PRICE OF THE GOODS;
(5) THE REPAYMENT BY THE FRANCHISEE OF A
BONA FIDE LOAN MADE TO THE FRANCHISEE FROM THE
FRANCHISOR;
(6) THE PURCHASE OF GOODS OR AGREEMENT TO
PURCHASE GOODS AT A BONA FIDE RETAIL PRICE SUBJECT TO A
BONA FIDE COMMISSION OR COMPENSATION PLAN THAT IN
SUBSTANCE REFLECTS ONLY A BONA FIDE WHOLESALE
TRANSACTION;
(7) THE PURCHASE, AT THEIR FAIR MARKET
VALUE, OF SUPPLIES OR FIXTURES, OR AGREEMENT TO PURCHASE
SUPPLIES OR FIXTURES, NECESSARY TO ENTER INTO THE
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![clear space](../../../images/clear.gif) |