KRS 367.830: Definitions.

Unless the context otherwise requires:

(1) "Participant" shall include, but is not limited to, those who give consideration in

order to participate in the pyramid distribution plan;

(2) "Person" means natural persons, corporations, trusts, partnerships, incorporated or

unincorporated associations, or any other legal entity;

(3) "Promotes" means inducing one (1) or more other persons to become a participant;

(4) "Pyramid distribution plan" means any plan, program, device, scheme, or other

process by which a participant gives consideration for the opp ortunity to receive

compensation or things of value in return for inducing other persons to become

participants in the program;

(5) "Compensation" means payment of any money, thing of value, or financial benefit

conferred in return for inducing others to b ecome participants in the pyramid

distribution plan. Compensation does not include payment based on sales of goods

or services by the person or by other participants in the plan to anyone, including a

participant in the plan, who is purchasing the goods or services for actual use or

consumption; and

(6) "Consideration" means the payment of cash or the purchase of goods, services, or

intangible property but does not include the purchase of goods or services furnished

at cost to be used in making sales and no t for resale, nor does it include time and

effort spent in pursuit of sales or recruiting activities.