§ 19-28.1-3 - Definitions.
SECTION 19-28.1-3
§ 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 inconnection with an offer or sale of a franchise.
(3) "Affiliate" means a person controlling, controlled by, orunder common control with another person, every officer or director of theperson, and every person occupying a similar status or performing similarfunctions.
(4) "Business day" means a day other than a Saturday, Sunday,or federal holiday.
(5) "Director" means the director of business regulation.
(6) "Disclosure document" means the uniform franchiseoffering circular as adopted and amended by the North American securitiesadministrators association, inc.
(7) "Franchise" means
(i) An oral or written agreement, either express or implied,which:
(A) Grants the right to distribute goods or provide servicesunder a marketing plan prescribed or suggested in substantial part by thefranchisor;
(B) Requires payment of a franchise fee in excess of fivehundred dollars ($500) to a franchisor or its affiliate; and
(C) Allows the franchise business to be substantiallyassociated 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 isgranted. Franchisee includes:
(i) A subfranchisor with regard to its relationship with afranchisor; and
(ii) A subfranchisee with regard to its relationship with asubfranchisor;
(9) "Franchise fee" means a direct or indirect payment topurchase or operate a franchise. Franchise fee does not include:
(i) Payment of a reasonable service charge to the issuer of acredit card by an establishment accepting the credit card;
(ii) Payment to a trading stamp company by a person issuingtrading stamps in connection with a retail sale; or
(iii) Agreement to purchase at a bona fide wholesale price areasonable 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 afranchisee, unless stated otherwise in this act.
(11) "Fraud" and "deceit" are not limited to common law fraudand deceit.
(12) "Marketing plan" means a plan or system concerning amaterial aspect of conducting business. Indicia of a marketing plan include:
(i) Price specifications, special pricing systems or discountplans;
(ii) Sales or display equipment or merchandising devices;
(iii) Sales techniques;
(iv) Promotional or advertising materials or cooperativeadvertising;
(v) Training regarding the promotion, operation or managementof the business; or
(vi) Operational, managerial, technical or financialguidelines or assistance.
(13) "Master franchise" means an agreement express orimplied, oral or written, by which a person pays a franchisor for the right tosell or negotiate the sale of franchises.
(14) "Offer" or "offer to sell" means every attempt to offeror to dispose of, or solicitation of an offer to buy, a franchise or interestin a franchise for value.
(15) "Order" means a consent, authorization, approval, orprohibition, issued by the director in a specific matter.
(16) "Person" means an individual or any other legal orcommercial entity.
(17) "Publish" means to circulate generally by mail, or printmedia or electronic media, or otherwise to disseminate generally to the public.
(18) "Registration application" means an initial franchiseapplication on the uniform franchise registration application as adopted andamended by the North American securities administrators association, inc. andthe amendment or renewal of the application.
(19) "Sale" or "sell" means every contract or agreement ofsale of, contract to sell, or a disposition of a franchise or interest in afranchise for value.
(20) "Salesperson" means a person employed by or representinga franchisor in effecting or attempting to effect the offer or sale of afranchise.
(21) "Subfranchisee" means a person who is granted afranchise or subfranchise from the subfranchisor.
(22) "Subfranchisor" means a person who is granted a masterfranchise.
(23) "This state" means Rhode Island.