Franchise agreement is generally an agreement between a supplier of a product or  service or an owner of a desired trademark or copyright (FRANCHISOR), and a reseller (FRANCHISEE) under which the franchisee agrees to sell the franchisors product or service or to do business under the franchisors name. A franchise is an agreement which gives the transferee the right to distribute, sell or provide goods, services or facilities, within a specified area, the cost of obtaining a franchise may be amortized over the life of the agreement. In agreement, a franchise is a capital asset and results in capital gains, or loss if all significant powers, rights on continuing interests are transferred pursuant to the sale of a franchiseÂ
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