Section 230-RICR-50-10-1.5 - Fractional FranchiseA. Any franchise that meets all of the following criteria shall be referred to as a fractional franchise and shall be exempt from registration requirements of R.I. Gen. Laws § 19-28.1-5 and the delivery requirements of R.I. Gen. Laws § 19-28.1-8 pursuant to the authority granted in R.I. Gen. Laws § 19-28.1-6(10).B. A fractional franchise is a business or other commercial entity purchased by a franchisee that has executed a licensing agreement with a franchisor to conduct the business of the franchisor on the premises of the franchisee subject to the following conditions: 1. The franchisee has two or more years' experience in an established business of which the franchisee will become a component;2. The franchised business will be operated from the same business location as the franchisee's established existing business; 3. The products or services offered by the franchised business will be substantially similar to the existing products or services offered by the franchise;4. The parties anticipate that the revenue from the franchise will not exceed twenty percent (20%) of the franchisee's primary business operation in the first year; and 5. The franchisee is not controlled by the franchisor.C. A fractional franchisor that registers under this rule shall register with the Department and pay the same registration fee as paid by an exempt franchise pursuant to R.I. Gen. Laws § 19-28.1-29(c). 230 R.I. Code R. 230-RICR-50-10-1.5