§ 19-28.1-3. Definitions.
When used in this act, unless the context otherwise requires:
(1) "Act� means the Rhode Island Franchise Investment Act.
(2) "Advertisement� means a communication published in connection with an offer or sale
of a franchise.
(3) "Affiliate� means a person controlling, controlled by, or under common control with
another person; every officer or director of the person; and every person occupying
a similar status or performing similar functions.
(4) "Calendar day� means every day of the week, including weekends.
(5) "Director� means the director of business regulation.
(6) "Disclosure document� means the uniform franchise offering circular as adopted and
amended by the North American Securities Administrators Association, Inc.
(7) "Franchise� means:
(i) An oral or written agreement, either express or implied, that:
(A) Grants the right to distribute goods or provide services under a marketing plan prescribed
or suggested in substantial part by the franchisor;
(B) Requires payment of a franchise fee in excess of five hundred dollars ($500) to a
franchisor or its affiliate; and
(C) Allows the franchise business to be substantially associated with a trademark, service
mark, trade name, logotype, advertising, or other commercial symbol of or designating
the franchisor or its affiliate; or
(ii) A master franchise.
(8) "Franchisee� means a person to whom a franchise is granted. Franchisee includes:
(i) A subfranchisor with regard to its relationship with a franchisor; and
(ii) A subfranchisee with regard to its relationship with a subfranchisor.
(9) "Franchise fee� means a direct or indirect payment to purchase or operate a franchise.
Franchise fee does not include:
(i) Payment of a reasonable service charge to the issuer of a credit card by an establishment
accepting the credit card;
(ii) Payment to a trading stamp company by a person issuing trading stamps in connection
with a retail sale; or
(iii) Agreement to purchase at a bona fide wholesale price a reasonable quantity of tangible
goods for resale.
(10) "Franchisor� means a person who grants a franchise. Franchisor includes a subfranchisor
with regard to its relationship with a franchisee, unless stated otherwise in this
act.
(11) "Fraud� and "deceit� are not limited to common law fraud and deceit.
(12) "Marketing plan� means a plan or system concerning a material aspect of conducting
business. Indicia of a marketing plan include:
(i) Price specifications, special-pricing systems, or discount plans;
(ii) Sales or display equipment or merchandising devices;
(iii) Sales techniques;
(iv) Promotional or advertising materials or cooperative advertising;
(v) Training regarding the promotion, operation, or management of the business; or
(vi) Operational, managerial, technical, or financial guidelines or assistance.
(13) "Master franchise� means an agreement, express or implied, oral or written, by which
a person pays a franchisor for the right to sell or negotiate the sale of franchises.
(14) "Offer� or "offer to sell� means every attempt to offer or to dispose of, or solicitation
of an offer to buy, a franchise or interest in a franchise for value.
(15) "Order� means a consent, authorization, approval, or prohibition issued by the director
in a specific matter.
(16) "Person� means an individual or any other legal or commercial entity.
(17) "Publish� means to circulate generally by mail, or print media or electronic media,
or otherwise to disseminate generally to the public.
(18) "Registration application� means an initial franchise application on the uniform franchise-registration
application, as adopted and amended by the North American Securities Administrators
Association, Inc. and the amendment or renewal of the application.
(19) "Sale� or "sell� means every contract or agreement of sale of, contract to sell, or
a disposition of a franchise or interest in a franchise for value.
(20) "Salesperson� means a person employed by or representing a franchisor in effecting,
or attempting to effect, the offer or sale of a franchise.
(21) "Subfranchisee� means a person who is granted a franchise or subfranchise from the
subfranchisor.
(22) "Subfranchisor� means a person who is granted a master franchise.
(23) "This state� means Rhode Island.