8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) December 17, 2014 (December 16, 2014)

FRANCHISE HOLDINGS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Nevada	0-27631	65-0782227
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1895 Clements Road, Pickering Ontario CANADA	M1P 4Y9
(Address of principal executive offices)	(Zip Code)

(888) 554-8789

Registrant's telephone number, including area code

5910 South University Boulevard—C-18, Unit 165, Littleton, Colorado 80121-2800

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

SECTION 1 - REGISTRANT’S BUSINESS AND OPERATIONS

ITEM 1.01 Entry into a Material Definitive Agreement.

On December 16, 2014, Franchise Holdings International, Inc. (FNHI) entered into a three party Definitive Share Exchange Agreement (the “Agreement”) to acquire all issued and outstanding shares of TruXmart Ltd. (The Company” or “TruXmart”), an Ontario (Canada) corporation located at 1895 Clements Road, Suite 155, Pickering, Ontario CANADA L1W 3R8, for 37,700,000 shares of FNHI (the “FNHI Shares”), representing 92.9925914% of the outstanding shares of FNHI (the “Share Exchange”), calculated post-issuance. The Agreement was with Steven Rossi (“Rossi”), the sole shareholder of TruXmart and with TruXmart. Prior to the Share Exchange, Rossi held all outstanding shares of TruXmart, consisting of 4,791 Class A common shares and TruXmart owned 2,300,000 common shares of FNHI, representing an 80.961285% ownership stake in FNHI. Pursuant to the Share Exchange, Rossi acquired from TruXmart, its 2,300,000 FNHI common shares and an additional 37,700,000 shares of FNHI from FNHI, in exchange for all 4,791 outstanding common shares of TruXmart. As a result of this Agreement, FNHI is filing this Form 8-K. Once the transaction is closed, TruXmart will become the wholly-owned subsidiary of FNHI, with FNHI holding all 4,791 outstanding shares of TruXmart common stock. As a result of this acquisition, FNHI has adopted the fiscal year end of TruXmart, which is December 31. The first consolidated post-acquisition report will be the Form 10-K for the fiscal year ended December 31, 2014.

Item 1.02 RISK FACTORS

This Current Report contains forward-looking statements that involve risks and uncertainties that could cause our actual results to differ materially from those discussed in this Current Report. These risks and uncertainties include, but are not limited to, the following.

Limited Operating History; Financial Position Not Robust; Losses/Lack of Profitable Operations to Date

TruXmart has incurred net losses since inception and may continue to incur net losses while it builds its business and as such it may not achieve or maintain profitability. The Company’s limited operating history makes it difficult to evaluate its business and prospects, and there is no assurance that the business of the Company will grow or that it will become profitable.

The Company has been in existence for approximately three years, which is relatively short compared to our competitors. While the Company has experienced recent substantial growth in our revenues in 2013 over 2012, and 2014 over 2013, there is no assurance that our revenues will continue to experience such a trend line, nor even that our revenues will continue to grow. Because of our limited operating history it is difficult to extrapolate any meaningful projections about the Company’s future. We do not have significant assets with which to press our plans forward.

Our competitors are significantly better funded than we are. This could prove detrimental in that we may not have the funds with which to procure a sufficient supply of product to meet demand at some point. Our competitors could engage in predatory pricing or other tactics in an attempt to eliminate our market share. The Company has incurred net losses since inception, and may continue to incur net losses while it builds its business, and as such it may not achieve or maintain profitability.

Future Growth

The Company’s ability to achieve its expansion objectives and to manage its growth effectively depends upon a variety of factors, including the Company’s ability to internally develop products, to attract and retain skilled employees, to successfully position and market its products, to protect its existing intellectual property, to capitalize on the potential opportunities it is pursuing with third parties, and sufficient funding. To accommodate growth and compete effectively, the Company will need working capital to maintain adequate inventory levels, develop additional procedures and controls and increase, train, motivate and manage its work force. There is no assurance that the Company’s personnel, systems, procedures and controls will be adequate to support its potential future operations. There is no assurance that the Company will generate revenues from its prospective sales partners and be able to capitalize on additional third party manufacturers.

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Reliance on Third Parties

Suppliers: Currently, the Company relies on two third party manufacturers to produce its products in China. These products are only available from a limited group of manufacturers, because of our product development alliances with these manufacturers. Under this alliance arrangement, each of the Company’s products are designed and engineered in co-operation with one of our two contract manufactures in China and, accordingly, each tonneau (a hard or soft cover for the bed of a pick-up truck designed to increase mileage and to protect items from inclement weather and potential theft) cover product can only be manufactured by the specific manufacturer with which they have been developed. Moreover, the tools, molds, specific grade of materials and assembly techniques are exclusive to the manufacture with which the product was developed. Manufacturing could be switched, but it would take time and there are no guarantees the product would be identical or that the Company would have sufficient inventory in the given product(s).

The Company’s reliance on outside manufacturers generally involves several risks, including: an inability to obtain an adequate supply of required products; the discontinuance of a product by a third-party contract manufacturer; an acquisition of the manufacturer by one of the Company’s competitors; delays or long lead times in receiving products from manufacturers; constraints on the ability of the supplier to operate as efficiently and quickly as required and less control over quality and pricing of components. There is no assurance that the Company’s manufacturers will continue to produce the products it requires in order to conduct business, which in turn would materially adversely affect its ability to generate revenue and profits.

Distribution: The Company relies on third party distribution entities (wholesale and retail) to sell its products. The Company relies on third party wholesalers to distribute its products to retail locations, over which the Company has little to no control in the wholesale or retail pricing and product placement and other marketing issues. Its products could be priced higher to the end user than its competition, which would have a detrimental effect on the Company’s sales. The Company relies on a third party online retailer to sell its products directly to the retail market. The Company has little to no control over pricing and other retail issues such as product placement, which could have a direct effect on the Company’s revenues.

In its desire to maintain a competitive position in the market, the Company has implemented and enforce a strict “MAP” (Manufacturers Authorized Price). MAP typically refers to the definite retail pricing of each of our products and differs between the Canadian and U.S. markets. Our products’ MAP pricing is set to be competitive in relation to competing products while allowing our distributor, dealer and retailer customer base to generate respectable margins of profit. Moreover, if our MAP pricing is violated by a product being advertised or sold above or below the then current MAP price, we take necessary steps with our customer(s) to remediate pricing to continue and maintain our competitive position in the marketplace. There are no guarantees that MAP pricing and other various forms of pricing and product control measures can be effectively monitored and enforced, especially as the Company’s market saturation grows.

Risks Associated with Outsourced Production

As outlined above, the Company outsources the manufacture of products to two contract manufacturers in China. In doing so, the Company selects its manufacturers, screened in advance based on their capabilities, supply capacity, reputation and other relevant traits. Nonetheless, the possibility of delivery delays, product defects and other production-side risks stemming from outsourcers cannot be eliminated. In particular, inadequate production capacity among outsourced manufacturers could result in the Company being unable to supply enough product amid periods of high product demand, the opportunity costs of which could be substantial.

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Risks Associated with Outsourced Production in China

Changes in Chinese laws and regulations, or their interpretation, or the imposition of confiscatory taxation or restrictions are matters over which the Company has no control. While the current leadership, (and the Chinese government), have been pursuing economic reform policies that encourage private economic activity and greater economic decentralization, there is no assurance, however, that the Chinese government will continue to pursue these policies, or that it will not significantly alter these policies from time to time without notice.

For example, the Chinese government has enacted some laws and regulations dealing with matters such as corporate organization and governance, foreign investment, commerce, taxation and trade. However, their experience in implementing, interpreting and enforcing these laws and regulations is limited and, in turn, our ability to enforce commercial claims or to resolve commercial disputes is unpredictable. If our business ventures with Chinese manufacturers were unsuccessful, or other adverse circumstances arise from these transactions, we face the risk that the parties to these ventures may seek ways to terminate the transactions regardless of any purchasing contracts or agreements we may have entered. The resolution of these matters may be subject to the exercise of considerable discretion by agencies of the Chinese government, and forces unrelated to the legal merits of a particular matter or dispute may influence their determination.

Any rights we may have to specific performance, or to seek an injunction under Chinese law, in either of these cases, are severely limited, and without a means of recourse by virtue of the Chinese legal system, we may be unable to prevent these situations from occurring. The occurrence of any such events could have a material adverse effect on our business, financial condition and results of operations, in such guises as currency conversion, imports and sources of supply, devaluations of currency or the nationalization or other expropriation of private enterprises.

In that context, we may have to evaluate the feasibility of acquiring alternative or fallback manufacturing capabilities to support the production of our existing and future tonneau cover products. Such development could adversely affect our cost structure inasmuch as we would be required to support sales at an acceptable cost—and might have relatively limited time to so adapt. We have not manufactured these products in the past—and are not expecting to do so in the foreseeable future. That is because developing these technological capabilities and building or purchasing a facility will increase our expenses with no guarantee that we will be able to recover our investment in our manufacturing capabilities.

Cross Border Sales Transactions

Cross border sales transactions carry a risk of changes in import tax and/or duties related to the import and export of our product, which can result in pricing changes, which will affect revenues and earnings. Cross border sales transactions carry other risks including, but not limited to, changing regulations, wait times, customs inspection and lost or damaged product

Additional Financing Requirements

From time to time, in order to expand operations to meet customer demand, the Company will need to incur additional capital expenditures. These capital expenditures are intended to be funded from third party sources, including the incurring of debt and/or the sale of additional equity securities. In addition to requiring additional financing to fund capital expenditures, the Company may require additional financing to fund working capital, research and development, sales and marketing, general and administrative expenditures and operating losses. The incurrence of debt creates additional financial leverage and therefore an increase in the financial risk of the Company’s operations. The sale of additional equity securities will be dilutive to the interests of current equity holders. In addition, there can be no assurance that such additional financing, whether debt or equity, will be available to the Company or that it will be available on acceptable commercial terms. Any inability to secure such additional financing on appropriate terms could have a materially adverse impact on the business, financial condition and operating results of the Company.

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Reliance on Key Personnel

The Company’s success also will depend in large part on the continued service of its key operational and management personnel, including executive staff, research and development, engineering, marketing and sales staff.

Most specifically, this includes its President/CEO Steven Rossi and its Chief Operating Officer Steven Raivio who oversee new product development (in lieu of a research and development department) as well as implementation of new products developed, key customer acquisition and retention, overall management and future growth. The Company faces intense competition for these professionals from its competitors, customers and other companies throughout the industry. Any failure on the Company’s part to hire, train and retain a sufficient number of qualified professionals could impair the business of the Company.

Intellectual Property

The Company’s success depends to a significant degree upon its ability to develop, maintain and protect proprietary products and technologies. The Company has one patent through a licensing agreement with its President and CEO at no cost to the Company. The Company intends to file additional patent applications in the U.S. and Canada as part of its strategy to protect its proprietary products and technologies. However, patents provide only limited protection of the Company’s intellectual property. The assertion of patent protection involves complex legal and factual determinations and is therefore uncertain and potentially expensive. The Company cannot provide assurance that patents will be granted with respect to its pending patent application, that the scope of any patents it might obtain will be sufficiently broad to offer meaningful protection, or that it will develop additional proprietary products that are patentable. In fact, any patents which might issue from the Company’s two pending provisional patent applications with the USPTO could be successfully challenged, invalidated or circumvented. This could result in the Company’s pending patent rights failing to create an effective competitive barrier. Losing a significant patent or failing to get a patent issued from a pending patent application the Company considers significant, could have a material adverse effect on the Company’s business.

Confidentiality Agreements with Employees and Others may not Adequately Prevent Disclosure of Trade Secrets and Other Proprietary Information.

In order to protect our proprietary technology and processes, we also rely in part on confidentiality agreements with our employees, consultants, outsource manufacturers and other advisors. These agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, others may independently discover trade secrets and proprietary information. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

Foreign Currency Risk

The Company is subject to foreign exchange risk as it has two manufacturing facilities in China, markets extensively in both Canadian and U.S. markets, most of the Company’s employees reside in Canada and, to date, the Company has raised funds in Canadian Dollars. Meanwhile, the Company reports results of operations in U.S. Dollars (USD or US$). Since our Canadian customers pay in Canadian Dollar, the Company is subject to gains and losses due to fluctuations in the USD relative to the Canadian Dollar. While having our products manufactured in China, our manufacturers are paid in USD to better avoid the relatively greater fluctuation of the Chinese Yuan (RMB). Any large fluctuations in the exchange between the RMB and USD may cause product costs to increase, therefore affecting revenues and profits, potentially adversely.

Business Combinations

The Company may, in the future, pursue acquisitions of other complementary businesses and technology licensing arrangements. For example, we intend to seek out a joint venture with one or both of our Chinese manufacturers. In addition, we have been approached by competitors to license one or more of our tonneau cover products. The Company may also pursue strategic alliances and joint ventures that leverage its core products and industry experience to expand its product offerings and geographic presence. The Company has limited experience with respect to acquiring other companies and limited experience with respect to forming collaborations, strategic alliances and joint ventures.

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If the Company were to make any acquisitions, it may not be able to integrate these acquisitions successfully into its existing business and could assume unknown or contingent liabilities. Any future acquisitions the Company makes could also result in large and immediate write-offs or the incurrence of debt and contingent liabilities, any of which could harm the Company’s operating results. Integrating an acquired company also may require management resources that otherwise would be available for ongoing development of the Company’s existing business.

Competition and Market Share

We participate in the automotive aftermarket equipment industry which is highly competitive for a relatively limited customer base. New pickup truck sales (our principal market) are estimated to be 2,270,000 units for the year 2014, based on sales through November 30, 2014, (source: Wall Street Journal online) which should translate (using an approximate 75% of new truck sales) into approximately 1,700,000 new tonneau covers during the year. (source: Frost & Sullivan) With 3,457 of our tonneau covers sold during the same period, we believe the Company represents 2-tenths of one percent of this market. We consider 5-tenths of one percent of the market to be a break-even market share for us but there is no assurance that we will reach this market share objective.

In addition, some of our competitors sell their products at prices lower than ours and we compete primarily on the basis of product quality, features, value, service, and customer relationships. Our competitive success also depends on our ability to maintain a strong brand and the belief that customers will need our products and services to meet their growth requirements. The competition that we face in our market — which varies depending on the particular business segment, product lines and customers — may prevent us from achieving sales, product pricing and income goals, which could affect our financial condition and results of operations. In addition, our current competitors are significantly better funded and have a longer operating history than us and, for example, we currently do not have sufficient funding to allow for separately marketing the TruXmart “brand.”

Product Liability Insurance

The existence of any defects, errors or failures in our products or the misuse of our products could also lead to product liability claims or lawsuits against us. We plan to acquire product liability insurance in both the U.S. and Canada over the next 3 to 6 months to cover such claims. Assuming that we will be able to acquire such coverage at reasonable cost, we have no assurance this insurance will be adequate to protect us from all material judgments and expenses related to potential future claims or that these levels of insurance will be available at economical prices, if at all. To that extent, product liability insurance is conditional and up for further investigation. A successful product liability claim could result in substantial cost to us. Even if we are fully insured as it relates to a claim, a claim could nevertheless diminish our brand and divert management's attention and resources, which could have a negative impact on our business, financial condition and results of operations. (See also the “Product Quality” discussion below and the associated recall insurance.)

Product Quality

Although the Company makes an effort to ensure the quality of our light truck tonneau cover products, they could from time to time contain defects, anomalies or malfunctions that are undetectable at the time of shipment. These defects, anomalies or malfunctions could be discovered after the Company’s products are shipped to customers, resulting in the return or exchange of the Company’s products, claims for compensatory damages or discontinuation of the use of the Company's products, which could negatively impact the profits and operating results of the Company. The Company does not presently have product recall, (or similar function), insurance, namely, (in contrast to product liability), insurance that protects a company against broad-scale product manufacturing defects, engineering defects and the costs related to a broad product recall such as shipping, replacement or repairs. Even if in place, there is no guarantee that the full costs of any reimbursements or claims, law suits or litigation would be covered by such insurance. (See also the “Product Liability Insurance” discussion above.)

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Patent Enforcement & Infringement

The automotive aftermarket has been characterized by significant litigation and other proceedings regarding patents, patent applications and other intellectual property rights. The situations in which we may become parties to such litigation or proceedings may include:

· litigation or other proceedings we may initiate against third parties to enforce our patent rights or other intellectual property rights;

· litigation or other proceedings we or our licensee(s) may initiate against third parties seeking to invalidate the patents held by such third parties or to obtain a judgment that our products do not infringe such third parties’ patents; and

· litigation or other proceedings, third parties may initiate against us to seek to invalidate our patents.

If third parties initiate litigation claiming that our products infringe their patent or other intellectual property rights, we will need to defend against such proceedings.

The costs of resolving any patent litigation or other intellectual property proceeding, even if resolved in our favor, could be substantial. Many of our potential competitors will be able to sustain the cost of such litigation and proceedings more effectively than we can because of their substantially greater resources. In some instances competitors may proceed with litigation or other proceedings pertaining to infringement of their intellectual property as a means to hinder or devaluate the target defendant company, with no intention of the matter being resolved in their favor. Uncertainties resulting from the initiation and continuation of patent litigation or other intellectual property proceedings could have a material adverse effect on our ability to compete in the marketplace. Patent litigation and other intellectual property proceedings may also consume significant management time and costs. Substantial additional costs may be evident in the event that litigation or other proceedings were initiated against the Company because TruXmart would have to seek legal defense or counsel in the province (Canada) or state (U.S.) where the litigation or legal proceedings were filed.

Global Economic Conditions May Adversely Affect Our Industry, Business and Results of Operations

Our overall performance depends, in part, on worldwide economic conditions which historically is cyclical in character. The U.S. has largely worked its way out of an economic recession while other key international economies continue to be impacted by a recession, characterized by falling demand for a variety of goods and services, restricted credit, going concern threats to financial institutions, major multinational companies and medium and small businesses, poor liquidity, declining asset values, reduced corporate profitability, extreme volatility in credit, equity and foreign exchange markets and bankruptcies. By way of example, the automotive aftermarket, specifically fuel saving add-ons such as light-truck tonneau covers, is typically not as affected by economic slow-down or recession as other industries or market segments. Currently, these conditions, (since the Company’s sales are exclusively made in North America while production occurs in China), can be expected to change. In markets where our sales occur and which become depressed, these conditions affect the rate of spending and could adversely affect our customers’ ability or willingness to purchase our products, and delay prospective customers’ purchasing decisions, all of which could adversely affect our operating results. In addition, in a weakened economy, companies that have competing products may reduce prices which could also reduce our average selling prices and harm our operating results.

The Company faces Intense Competition from New Products

The Company’s tonneau cover products face intense competition from its competitors. This competition may increase as new products enter the market, especially those made overseas and marketed and sold directly into the North American market by overseas manufactures. In such an event, the competitors’ products may be of similar or better quality compared to the Company’s products. Alternatively, in the case of generic competition, they may be of equal or better quality and are sold at substantially lower prices than the Company’s products. At times, competitors may also release a generic or re-branded version of a current and successful product at a substantially reduced price in efforts to increase revenues or market share. As a result, if the Company fails to maintain its competitive position, this could have a material adverse effect on its business, cash flow, results of operations, financial position and prospects.

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Risks Related to Our Capital Stock

The public market for our common stock may be volatile and you could lose all or part of your investment. In the recent past, stocks, specifically those traded on the over-the counter (“OTC”) markets, generally have experienced high levels of volatility. Our common stock is traded on the OTC market under the symbol “FNHI” and is not eligible for trading on any national or regional securities exchange or the NASDAQ National Market. While that status is the Company’s longer term objective, a more active trading market for our common stock may never develop, or if such a market develops, it may not be sustained.

In the past, many companies that have experienced volatility in the market price of their stock have become subject to securities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns, which could seriously harm our business.

The Securities and Exchange Commission (“SEC”) has adopted regulations which generally define a “penny stock” to be an equity security that has a market price of less than $5.00 per share, subject to specific exemptions. The market price of our common stock is less than $5.00 per share and therefore is a “penny stock” and is subject to the “penny stock” rules of the SEC. The trading market in our securities is currently limited and relatively illiquid which status makes transactions in our stock cumbersome and may reduce the value of an investment in our common stock. Brokers and dealers effecting transactions in “penny stock” must disclose certain information concerning the transaction, obtain a written agreement from the purchaser and determine that the purchaser is reasonably suitable to purchase the securities. These rules may restrict the ability of brokers or dealers to sell our common stock and may affect your ability to sell shares.

We Have Not Voluntarily Implemented Various Corporate Governance Measures

Federal legislation, including the Sarbanes-Oxley Act of 2002, has resulted in the adoption of various corporate governance measures designed to promote the integrity of the corporate management and the securities markets. Some of these measures have been adopted in response to legal requirements. Others have been adopted by companies in response to the requirements of national securities exchanges, such as the NYSE or The NASDAQ Stock Market, on which their securities are listed. Among the corporate governance measures that are required under the rules of national securities exchanges are those that address board of directors' independence, audit committee oversight and the adoption of a Code of Ethics. Our Board of Directors expects to adopt a Code of Ethics at its next Board meeting. The Company has not adopted exchange-mandated corporate governance measures and, since our securities are not listed on a national securities exchange, we are not required to do so. It is possible that if we were to adopt some or all of these corporate governance measures, stockholders would benefit from somewhat greater assurances that internal corporate decisions were being made by disinterested directors and that policies had been implemented to define responsible conduct. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our senior officers and recommendations for director nominees may be made by a majority of directors who have an interest in the outcome of the matters being decided. Prospective investors should bear in mind our current lack of corporate governance measures in formulating their investment decisions.

We May Be Exposed to Potential Risks Relating to Our Internal Control Over Financial Reporting.

As directed by Section 404 of the Sarbanes-Oxley Act of 2002 (“SOX 404”), the SEC has adopted rules requiring public companies to include a report of management on the Company's internal control over financial reporting in its annual reports. While we expect to expend significant resources in developing the necessary documentation and testing procedures required by SOX 404, there is a risk that we will not comply with all of the requirements imposed thereby. At present, there is no precedent available with which to measure compliance adequately. In the event we identify significant deficiencies or material weaknesses in our internal control over financial reporting that we cannot remediate in a timely manner, investors and others may lose confidence in the reliability of our financial statements and our ability to obtain equity or debt financing could suffer.

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The Company Does Not Expect to Pay Dividends in the Foreseeable Future.

The Company has never paid cash dividends on its common stock and has no plans to do so in the foreseeable future. The Company instead intends to retain earnings, if any, to develop and expand its business.

Provisions of our Articles of Incorporation and Bylaws May Delay or Prevent Take-over Which May Not Be in the Best Interests of Our Shareholders.

Provisions of our articles of incorporation and bylaws may be deemed to have anti-takeover effects, which include when and by whom special meetings of our stockholders may be called, and may delay, defer or prevent a takeover attempt. In addition, certain provisions of the Nevada Revised Statutes also may be deemed to have certain anti-takeover effects which include that control of shares acquired in excess of certain specified thresholds will not possess any voting rights unless these voting rights are approved by a majority of a corporation's disinterested stockholders.

Any Investment in Our Securities Involves a High Degree of Risk

Investors should consider carefully the risks and uncertainties described above, and all other information in this Form 8-K and in any reports hereafter filed with the SEC before deciding whether to purchase or hold our securities. Additional risks and uncertainties not currently known to us or that we currently deem immaterial may also become important factors that may harm our business. The occurrence of any of the risks described in this Form 8-K could harm our business. The trading price of our securities could decline due to any of these risks and uncertainties, and investors may lose part or all of their investment.

SECTION 2 - FINANCIAL INFORMATION

ITEM 2.01 Completion of Acquisition or Disposition of Assets

On December 16, 2014, Franchise Holdings International, Inc. (FNHI) entered into a three party Definitive Share Exchange Agreement (the “Agreement”) to acquire all issued and outstanding shares of TruXmart Ltd. (The Company” or “TruXmart”), an Ontario (Canada) corporation located at 1895 Clements Road, Suite 155, Pickering, Ontario CANADA L1W 3R8, for 37,700,000 shares of FNHI (the “FNHI Shares”), representing 92.9925914% of the outstanding shares of FNHI (the “Share Exchange”), calculated post-issuance. The Agreement was with Steven Rossi (“Rossi”), the sole shareholder of TruXmart and with TruXmart. Prior to the Share Exchange, Rossi held all outstanding shares of TruXmart, consisting of 4,791 Class A common shares and TruXmart owned 2,300,000 common shares of FNHI, representing an 80.961285% ownership of FNHI. Pursuant to the Share Exchange, Rossi acquired from TruXmart, its 2,300,000 FNHI common shares and an additional 37,700,000 shares of FNHI from FNHI, in exchange for the 4,791 shares of TruXmart. As a result of this Agreement, FNHI is filing this Form 8-K. Once the transaction is closed, TruXmart will become the wholly-owned subsidiary of FNHI, with FNHI holding all 4,791 shares of TruXmart common stock. As a result of this acquisition, FNHI has adopted the fiscal year end of TruXmart, which is December 31. The first consolidated post-acquisition report will be the Form 10-K for the fiscal year ended December 31, 2014.

ITEM 2.02 Results of Operations and Financial Condition

Business Acquired

TruXmart, Ltd. was incorporated as an Ontario (Canada) corporation on December 13, 2011. On December 13, 2011, the Company issued 100 shares of common stock in exchange for CAD$100 in cash. On September 16, 2014 the Company issued 4,791 shares of Class A common stock in exchange for CAD$4,791, which was satisfied by set-off against shareholder loans previously made to the Company.

TruXmart was formed to commercialize a variety of ideas that the founder, Steven Rossi, has related to improving light truck bed tonneau covers.

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Market Summary

In 2013 sales of new pick up trucks exceeded 1,800,000 in the U.S. and more than 350,000 in Canada. Throughout their useful lives, it is estimated over 75% will use some aftermarket bed cover. The tonneau cover segment of the automotive aftermarket generated revenues of $255 million in 2005. It is estimated the tonneau cover segment to be closer to $500 million in 2014. (See also “Competition and Market Share” in Risk Factors above.)

Background

For many years, consumers have had very limited options available to them from tonneau cover manufacturers. The leading manufacturers in the North American market have had very few new model developments. The tonneau cover market can be divided into four main styles of covers:

1.	Soft Folding & Roll-up covers (Vinyl covers)
2.	Hard Folding & Standing Covers (Aluminum and FRP)
3.	Solid one piece caps and lids (Plastic & Fiberglass)
4.	Retractable Covers (Plastic & Aluminum)

We believe the consumer favors models that are the least cumbersome, most functional, and lowest initial cost. Solid one piece covers and retractable covers are the least desirable because of their limited functionality and overall cost. Therefore, the most popular covers in today’s market are soft and hard folding/rolling tonneau covers.

Market Analysis and Distribution

Our market consists of three major types of customers which include; master warehouse distributor, dealer- wholesaler, and end retail consumer. Master warehouse distributors will stock and distribute product to their customers, which are usually local dealers and wholesalers. Dealers and wholesalers are local stores which sell product to some businesses and retail consumers in their area and online retailers. Dealers will purchase most of their product from their local distributor who will deliver to them regularly. Retail end consumers are simply the end user of your product. TruXmart currently sells its product line through distributors and dealer networks.

TruXmart’s target market includes master warehouse distributors and dealers.

In the Canadian market, TruXmart does the majority of its business with warehouse distributors, and select dealer customers. In the US market, TruXmart’s customer base is mostly dealers and wholesalers. TruXmart’s Canadian operation sells to only select dealers in Ontario as well as the largest warehouse distributor in eastern Canada. Enterprise Robert Thibert in Châteauguay, Quebec Canada has over 600,000 square feet of warehouse space in three provinces in Canada. Robert Thibert is responsible for stocking and selling our product to their customer base in Canada. TruXmart dealer sales in Ontario are to only select dealers who assist with product feedback.

TruXmart is a supplying member of one of the largest aftermarket buying groups in the U.S.. American Aftermarket Group (AAG), owned by Line-X coatings, consists of over 700 car and truck accessory stores. Being a supplying member of AAG gives TruXmart access to most of the large truck accessory dealers, wholesalers, and online stores in the USA. Our products are sold to AAG members by the sales staff at AAG and all customer service and maintenance is done through phone calls, emails, and infrequent visits.

A partial list of our material customers includes:

Enterprise Robert Thibert (Quebec, Canada)

Cross Country Distributing (Pennsylvania, USA)

American Aftermarket Group (Ohio, USA)

Trailer Parts Etc. (Florida, USA)

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Competition

Companies that compete in this market are THI Group, Tonno Pro and Rugged Liner however not all companies charge competitive prices:

The Extang (THI) Trifecta retails in the USA for $425. The Tonno Pro Tri Fold retails for $269. The Rugged Liner Tri Fold retails for $329. The TruXmart Tri Fold retails for CAD$259; US$239.

The Extang Solid Fold retails in the USA for $799. The Rugged Liner Hard Fold retails for $689. The TruXmart Forte retails at CAD$699; US$689.

Low profile Roll-Up covers are manufactured by many different companies. The two most popular Roll-Up covers are the Truxedo (THI) Low-ProQT, which retails for $499 and the Tonno Pro Low-Roll which retails for $269. The TruXmart Roll-Up retails for $CAD299; US$269.

THI Group is the holding company for Extang Corporation, TruXedo, Inc., BedRug, Inc, UnderCover Inc., Advantage Truck Accessories Inc, Retrax Inc, and BAK Industries. They account for the majority of the competing brands in North America.

The area of biggest growth in the tonneau cover market is in the area of aggressively priced hard folding tonneau covers. Currently, the market distribution is shared by three primary participants, with LKQ/Keystone considered the market leader.

Sales, Marketing and Distribution Strategy

TruXmart’s sales strategy is constantly changing and dynamic. Sales are made through warehouse distributors, as they typically handle product sales and promotion through their in-house sales department. To fully saturate the market a business must entice the retail consumer to purchase its product by way of a strong internet presence which will consist of YouTube videos and commercials, an interactive website, search engine optimization, social media, etc. The next step is to have strong working relationships and reputations among dealers and wholesalers who purchase TruXmart’s product, either directly or through distributors.

Patent

As of this date, the Company through Mr. Rossi has obtained one U.S. Patent. In addition, the Company retained patent counsel in October 2014 to file two provisional U.S. patent applications, also in this arena. TruXmart has paid $7,718 since approximately October 26, 2012, toward the costs of obtaining US Patent 8,814,249 - System for securing a truck bed cover, (filed October 26, 2012, granted May 1, 2014). This patent is owned by Steven Rossi, previously the sole stockholder of TruXmart. Under an exclusive license agreement between the Company and Mr. Rossi, dated November 26, 2014, TruXmart has the right to commercialize this patent. Under this agreement, TruXmart is not obligated to pay any royalties to Mr. Rossi. It is, however, obligated to pay any expenses incurred to keep the patent in full force and effect.

The Company’s current product lines are as follows:

1. TruXmart Tri Fold (introduced in 2011)

The TruXmart Tri Fold is our staple soft folding tonneau cover. The Tri Fold is made with features such as stainless steel hardware, double coated vinyl tarp, and all aluminum and plastic coated front clamps. The Tri Fold is made available to our customer base at an average cost savings of 5% over competing products.

2. TruXmart Smart Fold (introduced in 2012)

The TruXmart Smart Fold is our second product to market and offers our patented rear Smart Latch system. The Smart Fold is the first innovation in the rear latching system offered on soft folding tonneau covers. The Smart Fold cover comes with all of the same features as the Tri Fold but with a new rear latch system that allows the cover to be opened by simply pulling a release cable which is a new innovation in the soft tri fold segment of our market.

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The Company introduced three new products at the Specialty Equipment Manufacturers Association (SEMA) show in Las Vegas in November 2014. These products were the following:

3. TruXmart Forte

The TruXmart Forte is the world’s first completely solid folding tonneau cover to be constructed using powder coated galvanized steel. The TruXmart Forte is also the first tonneau cover to come with a removable tool bag that acts as a cargo divider when installed. This tool bag can be removed from the tonneau cover, zippered together, and carried using a shoulder or hand strap.

4. TruXmart Quad-Fold

The TruXmart Quad-Fold will be the first vinyl wrapped tonneau cover to fold in four sections. This cover will also allow its users full bed access by being foldable upwards towards the rear window of the truck. We chose to make the world’s first quad folding cover so this cover is more compact when standing parallel to the back window of a truck, thus eliminating wind resistance and rear window obstruction.

5. TruXmart Roll-Up

The TruXmart Roll-Up cover takes from a long history of roll up covers in our market place. Although roll-up style covers have been in the market since the early 90’s, the TruXmart Roll-Up will offer a sleek, low-profile design, superior side seals, and rear smart latches that will allow its user to open this cover by simply pulling on the rear release loop.

In addition, we are currently re-engineering the TruXmart Smart Fold latch system based on consumer feedback. As a consequence, the next generation Smart Fold covers will be far easier to install and will be available for both domestic and imported light trucks.

Production and Delivery

TruXmart products are manufactured to our specifications and design in China. All of our soft (vinyl) covers are made in a factory in Ningbo, China. All future TruXmart hard products are expected to be manufactured in Jiangsu, China. Our soft cover factory is capable of producing 3,000 pieces per month and our hard cover factory is capable of producing 1,500 pieces per month. Production at both factories can be increased within thirty days to facilitate volumes up to ten times the Chinese contract manufacturers’ current output without any stress on their capacity.

Management’s Discussion and Analysis and Results of Operations

The following management’s discussion and analysis (“MD&A”) should be read in conjunction with TruXmart, Ltd. financial statements for the years ended December 31, 2013 and December 31, 2012 and the Nine Months ended September 30, 2014 and September 30, 2013, and the notes thereto. Additional information relating toTruXmart, Ltd. (“TruXmart”) is available at www.truxmartcovers.com.

Safe Harbor for Forward-Looking Statements

Certain statements included in this MD&A constitute forward-looking statements, including those identified by the expressions anticipate, believe, plan, estimate, expect, intend, and similar expressions to the extent they relate to TruXmart Ltd. or its management. These forward-looking statements are not facts, promises, or guarantees; rather, they reflect current expectations regarding future results or events. These forward-looking statements are subject to risks and uncertainties that could cause actual results, activities, performance, or events to differ materially from current expectations. These include risks related to revenue growth, operating results, industry, products, and litigation, as well as the matters discussed in TruXmart’s MD&A under Risk Factors. Readers should not place undue reliance on any such forward-looking statements. TruXmart disclaims any obligation to publicly update or to revise any such statements to reflect any change in the Company’s expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

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Overview

TruXmart was founded in 2011 to take advantage of the limited innovation provided by existing tonneau cover manufacturers.

In 2013, over 2,100,000 pickup trucks were sold in North America. Throughout their useful lives, it is estimated that over 75% of those vehicles sold on an annual basis will use some aftermarket bed cover. The tonneau cover segment of the automotive aftermarket earned revenues of $255 million in 2005 and has grown to approximately $500 Million in 2013. (See also“Competition and Market Share” in Risk Factors above.)

TruXmart has developed multiple products for all of the most prominent pick up trucks available in North America. Details of each product can be found at www.truxmartcovers.com.

Tonneau covers have remained much the same in price and design since 2005 with one main company controlling a majority of the tonneau cover market. This market segment is in need of a new innovative manufacturer of high quality, functional, and aggressively priced tonneau covers.

Shipments to U.S. customer are typically prepaid and currently shipped via UPS Ground. However, some customer’s ship using their own freight accounts for a discount to compensate for their incurred shipping costs. Clients within Canada can pick up orders at the TruXmart warehouse, for which they are offered a 4% freight discount. Alternatively, products can be delivered to local dealers using TruXmart company trucks or parcel carriers such as Can Par and FedEx.

Presently, our largest volume customers are online retailers as a group accounting for 54% of our total sales in 2014 through September 30, with one of them accounting for 43% of total sales and 81% of our online sales. We had two online retailers in 2012 increasing to five in 2013. Each order from these customers is shipped directly to the end user, for which we use UPS Ground. Our second largest customer accounting for 26% of our sales is our warehouse distributor in Quebec, Canada. This customer picks up their orders at our Ontario, Canada warehouse using their own trucks. (See above Risk Factors – Concentration of Risk – Distribution).

TruXmart online retailer sales are shipped primarily from our contracted third party distribution Depew, NY warehouse. Shipments from the Canadian warehouse to Canadian customers are subject to an additional shipping fee based on location as shipping within Canada is more expensive than the US.

TruXmart initially set up its distribution center in Depew, New York in 2013 to open up the US market to traditional product sales and distribution through common master warehouse distributors. Since master warehouse distributors can take some time to acquire as a customer, sales were compensated for by acquiring online retailers, which have proven to be more beneficial to TruXmart. Online retailers offer greater margins of profit, larger volumes, fewer returns and assistance in developing a “product brand” through their “direct to retail” sales. Typically, once market share is acquired through online retailers, master warehouse distributors are more receptive to carrying a product because the market has already been established.

Sales to online retailers were shipped out of the Buffalo warehouse and shipped primarily on our UPS ground account. All ancillary border costs are included in our pricing. Ground shipping, transfer, duty, and tax related expenses are included in our pricing. Import duties are paid for by the Company and then incorporated into our customer pricing. Import duties are paid for by TruXmart under an expense account and considered when pricing product to distributors.

Up until now, TruXmart has not utilized any forms of paid advertising through any forms of media. We print product brochures as required and have point of purchase displays for our customers’ showroom, if requested. We evaluate customer requests for co-operative promotions to put our products in their catalogues, distributed to their dealer network. All co-operative advertising is approved by TruXmart tailored for the customer. Co-operative advertising has only been done with our warehouse distributor in Quebec, Canada and is done once per year as a cost to put our product in their catalog distributed to their dealer base.

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Year Ended December 31, 2013 Compared to the Year Ended December 31, 2012

Revenue

For the year ended December 31, 2013, revenue generated from the entire line of TruXmart products was $465,800, as compared to $278,800 for the year ended, December 31, 2012. The year over year increase of approximately 67% was mainly attributable to the addition of new online retailers.

For the year ended December 31, 2013 revenue generated in Canada was $209,300 compared to $209,900 for the same period in 2012. For the year ended December 31, 2013 revenue generated in the United States was $256,500compared to $68,900 for the same period in 2012. This represents an increase of approximately 272% year over year. This large increase in the US is primarily attributable to the addition of online retailers.

In 2013 sales from online retailers of the TruXmart products increased from $36,424 in 2012 to $231,097 in 2013, an increase of over 600%. The online retailers accounted for over 47% of total revenue for the year ended December 31, 2013 compared to 13% for the year ended December 31, 2012. In 2012, TruXmart entered the U.S. market and a “sale” price was offered to entice new business as a “limited time” promotion. This was a $5 discount off of our wholesale price and the net discount was recorded in the sale price of the product. This discount was discontinued in 2013.

Distributor sales declined from 45% of total sales in 2012, to 34% in 2013.

In early 2012, TruXmart developed a distribution relationship with a prominent Canadian auto accessory distributor along with an additional distribution relationship in the United States. The additions of these distributors allowed TruXmart to deliver and present the Company’s products to a wider potential market. In 2012 the Company also developed relationships with small online retailers which also enhanced the potential reach for TruXmart products. The addition of another successful distributor relationship in 2013 can also be attributed to the growth of revenues from 2012 to 2013.

Currently, TruXmart has two major distributors in Canada, one in the United States, along with its own contracted distribution and inventory facility in Depew, NY. This does not include multiple independent online retailers.

Although TruXmart currently supports a total of 13 dealers and distributors, TruXmart believes the trend of increasing sales through online retailers will continue to outpace the traditional distribution business model. Moreover, reputable online retailer’s customers tend to provide larger sales volumes, greater margin of profit as well as greater protection against price erosion.

Cost of Sales

Cost of sales increased from $159,800 to $347,700, or 118%. This increase was primarily due to a corresponding increase in sales for the year. Our cost of sales, as a percentage of sales, was approximately 57% and 75% for the years ended December 31, 2012 and 2013, respectively.

Our cost of sales, as a percentage of gross sales was higher in 2013 because of the special introductory discounts offered to the online retailers’ customers to increase sales volumes. Our actual cost of sales on a per item basis increased approximately 24% year over year. This is due to an increase in U.S. sales where we use a warehouse that charges a per item pick fee that is allocated to Cost Of Goods Sold however also minimizes any warehouse wages and costs in the G & A. Compounded with the increased sales requiring individual shipping in the U.S. market our freight costs have increase by $54,484. Freight costs are 18% of our COGS whereas in 2012 it accounted for less than 6%. A portion of this increase, approximately $1,900 was a one time expense to move our inventory from a distribution warehouse in Buffalo, N.Y., to its current facility in Depew, N.Y.

TruXmart provides its distributors and online retailers an “all-in” wholesale price. This includes any import duty charges, taxes and shipping charges. Discounts are applied if the distributor or retailer chooses to use their own shipping process. Certain exceptions apply on rare occasions where product is shipped outside the contiguous United States or from the United States to Canada. Volume discounts are also offered to certain higher volume customers.

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General and Administrative Expenses

General and administrative expenses for the year ended December 31, 2013 were $153,100 compared to $150,700 for the year ended December 31, 2012. The small increase was the result of several areas of expenses having significant offsetting swings. Our gain on foreign currency transactions increased $4,900, from $900 in 2012 to $5,800 in 2013. Foreign currency transactional gains were caused by a weaker USD through 2012, into 2013. TruXmart’s products are purchased in US dollars. Therefore, all US revenues are sold with no possibility of loss or gain, regardless of the USD volatility. However, it is advantageous to TruXmart when the CAD is “at par” or stronger than USD, which it was for some of 2012 – 2013. Our office and general expense decreased $19,000, from $73,700 to $52,400. Office and general expenses decreased into 2013 since most of TruXmart’s “start up” costs were realized and accrued in 2012, once TruXmart had established operations in USA and Canada in 2013, a decrease of G&A costs was expected and realized. Shipping and freight increased $16,000 from $35,600 to $51,200. Freight increased because we had an increase of sales from our online retailers who request us to pay to ship, via ground courier, from our warehouse, direct to their customers home or business. Their “cost” of our product includes this shipping charge, which we then later have to pay. Sales and marketing increased $20,000 from $14,400 to $34,000. Sales and marketing costs increased due co-operative advertising ventures with some of our warehouse distributors, where our line of products were actively marketed throughout our warehouse distributors dealer network, thereby effectively increasing brand awareness and sales.

Net Loss

Net loss for the year ended December 31, 2012 was ($33,500) compared to a net loss of ($36,900) for the year ended December 31, 2013. This small increase in the loss was almost entirely due to the increased General and Administrative Expenses, as our Gross Profit remained virtually constant.

Liquidity and Capital Resources

Cash Flow Activities

Cash increased $8,800 from $8,700 at December 31, 2012 to $17,500 at December 31, 2013. This increase was a result of a $4,000 increase in cash provided by operating activities; accounts receivable increasing $18,800 from $30,200 to $49,000; inventory decreasing $41,800 from $155,000 to $113,200 due to greater than expected sales and accounts payable decreasing $57,500 from $159,900 to $102,400. Our primary payable is for the container loads of product manufactured by our supplier. There is a 15-30 day period of time from when payment to our manufacturer is made to when a container of product and the receipt of that product arrives in our warehouse. The increases in inventory and accounts payable were directly related to two container loads of product shipped near year end, one paid for in full and the other with a deposit paid in December. One container landed on Jan. 2, 2014 and the other on Feb. 12, 2014.

Financing Activities

During 2012 and 2013 TruXmart funded working capital requirements principally through stockholder loans. At December 31, 2012, the loan balance was $19,000 which was repaid during 2013.During 2013 the Company was able to generate funds for operations and be less reliant on loans from its stockholder.

Nine Months Ended September 30, 2014 Compared to Nine Months Ended September 30, 2013

Revenue

For the nine months ended September 30, 2014, revenue generated from the entire line of TruXmart products was $484,200 compared to $345,800 for the nine months ended September 30, 2013 The period over period increase of approximately 40% was mainly attributable to the addition of new online retailers. As well, the increase in sales was linear to the increase in overall stock. As TruXmart was able to carry, at times, larger inventory levels which was then used to increase sales from “online retailers” as well as fill “pending orders” (purchase orders we had placed on back order since we did not have stock to fill these orders) with our warehouse distributors. TruXmart has typically maintained “less than adequate” levels of inventory to fully realize true revenue potentials. As our inventory levels become stronger and more stable, our sales increase. In 2013, TruXmart had focused on increasing levels of inventory in both our Canadian warehouse and our third party logistics warehouse in Buffalo, N.Y., which lead to a 40% increase in revenue.

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Internet direct sales was $157,400 or 44% of our sales in 2013 and has grown to $279,000 or 54% of sales in 2014 whereas distributor sales have declined from 36% of total sales in 2013 to 34% in 2014. Internet direct sales increased because TruXmart’s online retailers are able to sell items based on our stock. Therefore, should TruXmart have a shortage of inventory on some of our fastest selling part numbers, the online retailers are able to adjust and focus their sales and marketing efforts to sell the products TruXmart has in stock. Whereas, warehouse distributors issue purchase orders usually for a broad spectrum of items, some or most of which TruXmart may not have sufficient inventory levels to fill. Therefore, online retailers are able to sell based on TruXmart’s actual inventory, whereas warehouse distributors order only what they require for stock, which requires TruXmart to maintain strong inventory levels to fulfill. TruXmart, throughout 2013 and 2014 has struggled to maintain sufficient inventory levels to allow us to fully and quickly fill warehouse distributor purchase orders. In the future, with funding, TruXmart can maintain a stronger inventory level so that orders from both online retailers and warehouse distributors can be fulfilled.

For the nine months ended September 30, 2014, revenue generated in Canada was $179,900 compared to $165,800 for the same period in 2013. This represents an increase of approximately 6% period over period.

For the nine months ended September 30, 2014, revenue generated in the United States was $308,300 compared to $180,000 for the same period in 2013. This represents an increase of approximately over 71% year over year.

Cost of Sales

Cost of sales increased from $260,900 to $344,000 or 32%. This increase was primarily due to a corresponding increase in sales for the period. Our cost of sales, as a percentage of sales, was approximately 71% and 75% for the nine months ended September 30, 2014 and 2013, respectively. TruXmarts cost of sales will typically increase with our sales and revenues because our cost of Freight, Warehousing, as well as General and Administrative expenses will increase to facilitate those sales. However, TruXmart’s cost of sales structure has been planned so to not increase “linear” with our sales and overall revenues. This is done because of TruXmart’s reliance on third party logistics and distribution warehouses that associates a “cost per sale”, which is built into our customers pricing. Therefore, should TruXmart experience an increase of sales, costs of those sales are only realized as those orders (sales) are processed and invoiced. Whereas, should TruXmart experience a period of time with lower sales, we realize far smaller expenses during those times as we do not have common overhead such as: rent, staff, machinery, utility bills, etc.

General and Administrative Expenses

General and administrative expenses for the nine months ended September 30, 2014 were $170,100 compared to $114,600 for the same period 2013. The 48% increase was the result of several areas of expenses having significant increases. Our gain on foreign currency transactions increased $9,800 from $1,400 in 2013 to $11,200 in 2014. Our office and general expense decreased $3,600, from $39,700 to $36,100. Professional fees increased $43,500 from ($500) to $43,000 as a result of expenses related to preparing to become a public company. Shipping and freight increased $27,500 from $33,000 to $60,500. In 2013 and 2014, TruXmart freight costs increased in line with our increased sales revenue generated through online retail customers. Online retailers often request a “landed” price which means cost of product with shipping within the contiguous U.S. Sales and marketing increased 38,700 from 28,500 to 67,200, In November 2014, TruXmart displayed at SEMA (the largest automotive aftermarket trade show in North America) at the cost of approximately $55,000 of which $44,500 was prepaid by September 30, 2014.

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Net Loss

Net loss for the nine months ended September 30, 2013 was ($29,700) compared to a net loss of ($34,800) for the same period ended September 30, 2014. This 25% increase in the loss was almost entirely due to the increased General and Administrative Expenses, as our Gross Profit as a percentage of Sales rose from 24.5% to 29%.

Liquidity and Capital Resources

Cash Flow Activities

Cash increased $23,000 from $17,500 at September 30, 2013 to $40,500 at September 30, 2014. This increase was a result of accounts receivable increasing $1,800 from $30,200 to $32,000; inventory decreasing $89,000 from $155,000 to $66,000. Cash increased primarily as a result of lower inventory levels. Inventory levels were lower in 2014 because we diverted cash from sales to funding our appearance and exhibition at SEMA, instead of putting more product in stock. As a result of the SEMA show, we now have larger customers on deck for 2015.

Financing Activities

During the nine month periods ended September 30, 2014 and 2013 the Company became less reliant on loans from its shareholder as it was generating sufficient cash flows from operations.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported in the financial statements, including the notes thereto, and related disclosures of commitments and contingencies, if any. We consider our critical accounting policies to be those that require the more significant judgments and estimates in the preparation of financial statements, including the following:

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, trade receivables, prepaid expenses, payables and accrued expenses, Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. We consider the carrying values of our financial instruments in the consolidated financial statements to approximate fair value, due to their short-term nature.

Property and Equipment

Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is provided for using straight-line methods over the estimated useful lives of the respective assets, usually three to seven years.

Valuation of Long-Lived Assets

We periodically evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. If the estimated future cash flows (undiscounted and without interest charges) from the use of an asset were less than the carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value. We do not believe that there has been any impairment to long-lived assets as of December 31, 2012 and 2013.

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Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements as defined in Regulation S-K Item 303(a)(4).

Recent Accounting Pronouncements

(See “Recently Issued Accounting Pronouncements” in Note 3 of Notes to the Financial Statements.)

SECTION 4 - MATTERS RELATED TO ACCOUNTANTS AND FINANCIAL STATEMENTS

ITEM 4.01. Changes in Registrant's Certifying Accountant

Current and Prior Auditor:

On December 9, 2014, as a result of the acquisition of FNHI by TruXmart, the Company dismissed B.F. Borgers, CPA, PC, as the independent auditor of FNHI effective immediately after the filing of the September 30, 2014 final stand alone Form 10-K which is expected to be filed on or before the due date of this filing of December 29, 2014.

During the Registrant's two most recent fiscal years and during any subsequent interim period prior to the December 9, 2014, dismissal as the Company's independent auditors, there were no disagreements with, B.F. Borgers, PC with respect to accounting or auditing issues of the type discussed in Item 304(a)(3) of Regulation S-K.

Newly Appointed Auditor:

On December 9, 2014, the Company's board of directors approved the engagement of the firm of HJ & Associates, L.L.C. as the Company's independent auditors effective December 16, 2014 Form 10-K. Such appointment was accepted by such firm.

During the Registrant's two most recent fiscal years or any subsequent interim period prior to engaging HJ & Associates, L.L.C., neither the Company nor anyone on the Company's behalf, had consulted with such firm regarding any of the accounting or auditing concerns stated in Item 304(a)(2) of Regulation S-K.

On December 11, 2014, the Company provided B.F. Borgers, CPA. PC with a copy of this disclosure and requested that it furnish a letter to the Company, addressed to the SEC, stating that it agreed with the statements made herein or the reasons why it disagreed.

SECTION 5 - CORPORATE GOVERNANCE AND MANAGEMENT

ITEM 5.01 Change in Control of Registrant. With the issuance of 37,700,000 shares of common stock in exchange for 100% of the common shares of TruXmart, the previously existing holders of capital stock of FNHI became minority holders of the capital stock of FNHI. The change of control of FNHI was effected by the cash purchase of 2,300,000 shares of FNHI capital stock by TruXmart on November 7, 2014 and by the issuance of newly issued shares of the Company to the former shareholders of TruXmart upon the acquisition without any other consideration.

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ITEM 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

As previously reported in Form 8-K on November 12, 2014:

(a) Effective on November 7, 2014, Arnold Boisdrenghien (the then sole officer of FNH) resigned as an officer and was replaced by Mr. Steven Rossi. Mr. Boisdrenghien, on the same date, appointed Mr. Rossi as co-director.

(b) Upon the effectiveness of the Company’s Form 14-F Change of Control as filed with the Securities and Exchange Commission (November 24, 2014), Mr. Boisdrenghien’s resignation as the FNHI co-director became effective.

(c) Accordingly, Mr. Rossi became the President/Chief Executive Officer, Secretary and sole director of FNHI on November 24, 2014. Prior to the acquisition of the control block of shares on November 7, 2014, Mr. Rossi had no relationship with FNHI. He is also President/CEO and sole director of TruXmart.

(d) Mr. Steve Raivio and Mr. Lorenzo Rossi were elected as additional directors at a Board of Directors meeting on December 9, 2014. Mr. Raivio was also appointed as Chief Operating Officer at such meeting.

Name	Age	Position
Steven Rossi	29	President/Chief Executive Officer, Secretary and Director
Steve Raivio	45	Chief Operating Officer and Director
Lorenzo Rossi	58	Director

Steven Rossi

Mr. Rossi attended from the University of Toronto from 2005 to 2007, majoring in Life Science. He founded two companies in 2005 and 2006: 2230164 Ontario, Inc. and Scrap my Junk Car. Both businesses are still in operation and Mr. Rossi is not active in the business operations of them at this time. Mr. Rossi established, developed and ran both of these automotive related companies at the same time for five years. Since founding TruXmart, Mr. Rossi has been granted one U.S. Patent on tonneau cover design and has filed two more U.S. Patent applications. He licensed the first patent to TruXmart on an exclusive basis.

Steve Raivio

Mr. Raivio attended Mount Royal College from 1988 to 1989 and Southern Alberta Institute of Technology from 1990 to 1992. He was a General Manager at Video Kingdom from 1990 to 1995 and was involved in the Company’s growth from 2 to 27 stores. He was a manager at Mission plastics from 1995 to 1997. He began his experience in the motor vehicle market in 1997 as a General Manager for Focus Auto Design until 2002 He worked on the development of systems and procedures leading to the Company receiving ISO 9001 registration. Then as a Business Development Manager for Willpak Industries from 2002 to 2003, where he exhibited at SEMA and developed Kia Canada and an OEM customer; and as a General Manager at TGF Bumper & Fender from 2004 through 2010 where he developed the setup and logistics for product importation from Taiwan.

Lorenzo Rossi

Mr. Rossi received a Master of Education in 1995 from the University of Toronto and a Bachelor of Arts from Laurentian University in 1977. Since 2005 he has been the Computer Science & Communications Technology Department Head at the Cardinal Carter Academy for the Arts of the Toronto Catholic District Schools. Mr. Lorenzo Rossi is the father of Mr. Steven Rossi. 

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Executive Compensation of TruXmart Officers

Mr. Steven Rossi became the sole officer of FNHI after the closing of the acquisition, namely November 7, 2014. The following table sets forth the compensation earned during the years ended December 31, 2013 and 2012 by TruXmart officers who became officers of the Company, respectively on November 7 and December 9, 2014:

									Long Term
									Compensation
									Awards
									Securities
	Annual Compensation 19								Underlying
Name and Principal Position	Salary ($)					Bonus ($)			Options
Steven Rossi, President	2014		*	$	0**	$	0	$	0
		2013		$	0**	$	0
		2012		$	0**	$	0	$	0
		2011		$	0**	$	0	$	0
Steven Raivio, COO		2014	*	$	16,150	$	0	$	0
		2013		$	19,961	$	0
		2012		$	20,479	$	0	$	0
		2011		$	4,504	$	0	$	0

______________ 

* - Through September 30, 2014

** - Mr. Rossi received no compensation from TruXmart but contributed services with a fair market value of $34,265 in the nine months of 2014; $32,400 in 2013; $50,200 in 2012 and $50,600 in 2011.

Related Party Transactions

1 - Steven Rossi is the owner of U.S. Patent #8,814,249 filed on October 26, 2012 and issued on May 1, 2014. TruXmart paid $7,718 in patent filing expenses. TruXmart licenses this patent from Mr. Rossi.

2 - TruXmart recorded the fair value of services rendered and contributed to the Company in the amount of $48,548 for the year ended 12/31/2013and $50,219 for the year ended 12/31/2012 and $34,265 for the nine months ended September 30, 2014.In addition, TruXmart applied $16,146 of the $48,548 in 2013 and $20,471 of the $34,265 for the nine months ended September 30, 2014 to the shareholder loan account.

ITEM 5.03 Amendments to the Articles of Incorporation or Bylaws: Change in Fiscal Year

As a result of this acquisition, FNHI has adopted December 31 as its fiscal year end and will be filing, no later than December 29, 2014, its last standalone 10-K for the fiscal year ended September 30, 2014. The first consolidated FNHI-TruXmart post-acquisition report will be the Form 10-K for the fiscal year end December 31, 2014 on or before March 30, 2015.

ITEM 5.05 Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics.

The Company has not adopted a written code of ethics.

SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS

ITEM 9.01 Financial Statements and Exhibits

A. Financial Statements of Business Acquired

TruXmart Financial Statements for the years ended December 30, 2013 and 2012, with independent auditors report and for the nine months ended September 30, 2014 and 2013 (including Balance Sheets, Statement of Operations, Statements of Shareholders' Equity, Statement of Cash Flows, and Notes to Consolidated Financial Statements) filed hereto start on page F-1 of this Form 8-K.

20

B. Pro Forma Financial Information

Unaudited Pro Forma Condensed Financial Statements of FNHI (consolidated) and TruXmart, (including Balance Sheet), Statement of Operations and Notes to Pro Form Financial Statements) as of and for the year ended September 30, 2014 and December 31, 2013, respectively; Unaudited Pro Forma Condensed Statement of Operations and Notes to Pro Form Financial Statements for the nine months ended June 30, 2014 and September 30, 2014, respectively filed hereto.

C. Exhibits

Exhibit No.	Description
10.1	Definitive Share Exchange Agreement, dated as of December 16, 2014, by and among the Company and TruXmart, Ltd.
10.2	Patent License Agreement dated November 26, 2014
10.3	Consulting Agreement Between TruXmart, Ltd. And Belair Capital Markets dated November 11 2014
10.4	Shipping Agreement with Federal Express (FedEX) dated September 26, 2014
10.5	Shipping Agreement with United Parcel Service (UPS) dated March 31, 2014
10.6	Warehousing and Shipping with JBF Express dated June 24, 2013
10.7	Form of the Continuous Importation Bond with Globe Express Services dated January 4, 2014
16.1	B.F. Borgers, CPA. PC letter regarding change of independent auditors effective upon filing of Company’s Form 10-K for period ended September 30, 2014

21

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

	FRANCHISE HOLDINGS INTERNATIONAL, INC.
December 17, 2014	By:	/s/ Steven Rossi
	Name:	Steven Rossi
	Title:	President/Chief Executive Officer

22

Financial Statements

TruXmart Ltd.

For the Years Ended December 31, 2013 and 2012

INDEX

Report of Independent Registered Public Accounting Firm	F-2
Balance Sheets		F-3
Statements of Operations, Comprehensive Loss and Deficit		F-4
Statements of Shareholder's Equity		F-5
Statements of Cash Flows		F-6
Notes to the Financial Statements		F-7-F-15

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

TruXmart Ltd.

Pickering, Ontario, Canada

We have audited the accompanying balance sheets of TruXmart Ltd. as of December 31, 2013 and 2012, and the related statements of operations, comprehensive loss and deficit, shareholder’s' equity, and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

We believe that our audits provide a reasonable basis for our opinion.In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of TruXmart Ltd. as of December 31, 2013 and 2012, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.

/s/ HJ & Associates, LLC

HJ & Associates, LLC

Salt Lake City, Utah

December 17, 2014

F-2

TruXmart Ltd.

Balance Sheets as at December 31, 2013 and 2012

	2013			2012
Assets
Current Assets
Cash and cash equivalents	$	17,517		$	8,677
Accounts receivable		30,233			48,989
Inventory (note 4)		155,005			113,222
Prepaid expenses and deposits		1,520			481
		204,275			171,369
Capital Assets (note 5)		229			438
Intangible Assets (note 6)		7,718			5,776
	$	212,222		$	177,583
Liabilities
Current Liabilities
Accounts payable and accrued liabilities	$	159,900		$	102,443
Income taxes payable (note 11)		6,316			4,757
Shareholder loan (note 7)		-			19,040
		166,216			126,240
Shareholder's Equity
Share Capital (note 8)		100			100
Capital Surplus (note 10)		133,172			100,770
Cumulative Translation Adjustment		(2,429	)		(1,625	)
Deficit		(84,837	)		(47,902	)
		46,006			51,343
	$	212,222		$	177,583

The accompanying notes form an integral part of these financial statements.

F-3

TruXmart Ltd.

Statements of Operations, Comprehensive Loss and Deficit

For the years ended December 31, 2013 and 2012

	2013			2012
Sales	$	465,812		$	278,815
Cost of Goods Sold		347,749			159,845
Gross Profit		118,063			118,970
Expenses
Amortization		209			209
Bad debts		-			748
Bank charges and interest		2,671			2,824
Loss (gain) on foreign exchange		(5,852	)		(915	)
Office and general		52,395			73,748
Professional fees		1,398			2,410
Product development		659			2,041
Rent and utilities		16,325			19,661
Shipping and freight		51,243			35,596
Sales and marketing		34,023			14,368
		153,071			150,690
Loss before Income Taxes		(35,008	)		(31,720	)
Provision for Income Taxes		1,927			1,737
Net Loss for the year		(36,935	)		(33,457	)
Other Comprehensive Loss
Currency translation adjustment		(804	)		(16	)
Comprehensive Loss for the year	$	(37,739	)	$	(33,473	)
Deficit - beginning of year	$	(47,902	)	$	(14,445	)
Net Loss for the year		(36,935	)		(33,457	)
Deficit - end of year	$	(84,837	)	$	(47,902	)

The accompanying notes form an integral part of these financial statements.

F-4

TruXmart Ltd.

Statements of Shareholder's Equity

For the years ended December 31, 2013 and 2012

	Number of Common Shares		Issued Capital		Capital Surplus		Cumulative Translation Adjustment			Retained Earnings (Deficit)			Total Equity
Balance at January 1, 2012		100	$	100	$	50,551	$	(1,609	)	$	(14,445	)	$	34,597
Fair value of services rendered by shareholder		-		-		50,219		-			-			50,219
Net loss for the year		-		-		-		-			(33,457	)		(33,457	)
Other comprehensive loss for the year		-		-		-		(16	)		-			(16	)
Balance at December 31, 2012		100	$	100	$	100,770	$	(1,625	)	$	(47,902	)	$	51,243
Fair value of services rendered by shareholder		-		-		32,402		-			-			32,402
Net loss for the year		-		-		-		-			(36,935	)		(36,935	)
Other comprehensive loss for the year		-		-		-		(804	)		-			(804	)
Balance at December 31, 2013		100	$	100	$	133,172	$	(2,429	)	$	(84,837	)	$	46,006

The accompanying notes form an integral part of these financial statements.

F-5

TruXmart Ltd.

Statements of Cash Flows

For the years ended December 31, 2013 and 2012

	2013			2012
Operating Activities
Comprehensive Loss for the year	$	(37,739	)	$	(33,473	)
Items not involving cash:
Amortization		209			209
Fair value of services rendered by shareholder		48,548			50,219
		11,018			16,955
Net changes in non-cash working capital:
Decrease (increase) in accounts receivable		18,756			(35,275	)
Decrease (increase) in inventory		(41,783	)		16,755
Decrease (increase) in prepaid expenses		(1,039	)		227
Increase (decrease) in income taxes payable		1,559			1,804
Increase (decrease) in accounts payable and accrued liabilities		57,457			41,459
		34,950			24,970
Cash provided by operating activities		45,968			41,925
Investing Activities
Capital assets		-			-
Intangible assets		(1,942	)		(5,776	)
Cash used in investing activities		(1,942	)		(5,776	)
Financing Activities
Payments to related parties		(35,814	)		(94,131	)
Proceeds from related parties		628			62,308
Cash used in financing activities		(35,186	)		(31,823	)
Change in cash		8,840			4,326
Cash and cash equivalents - beginning of year		8,677			4,351
Cash and cash equivalents - end of year	$	17,517		$	8,677

The accompanying notes form an integral part of these financial statements.

F-6

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

1. Nature of Operations

The Company was incorporated under the laws of the Ontario Business Corporations Act on December 13, 2011. The head office of the Company is located at 1895 Clements Road, Unit 155, Pickering, Ontario, Canada.

The Company designs and distributes truck tonneau covers in Canada and the United States.

2. Basis of Presentation

a) Statement of Compliance

The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") as issued by the Financial Accounting Standards Board ("FASB").

b) Basis of Measurement

The Company's financial statements have been prepared on the historical cost basis.

c) Functional and Presentation Currency

These financial statements are presented in United States Dollars. The functional currency of the Company is the Canadian Dollar.

d) Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

3. Significant Accounting Policies

Cash and Cash Equivalents

Cash and cash equivalents includes cash on account and demand deposits with reputable financial institutions.

Inventory

Inventory is stated at the lower of cost and market, with cost being determined by the first-in, first-out (FIFO) basis. Cost includes the cost of materials plus direct labour applied to the product.

F-7

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

3. Significant Accounting Policies (continued)

Revenue Recognition

Sales are recognized when products are shipped, with no right of return, and the title and risk of loss has passed to unaffiliated customers or when they are delivered based on the terms of the sale, there is persuasive evidence of an agreement, the price is fixed or determinable and collectibility is reasonably assured. Revenue related to shipping and handling costs billed to customers is included in net sales and the related shipping and handling costs are included in cost of products sold.

Capital Assets

Capital assets are recorded at cost and are amortized using the straight line method over the estimated useful lives:

Furniture and equipment	5 years
Computers	3 years

Income Taxes

Provisions for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the amount of taxable income and pretax financial income, and between the tax bases of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are included in the consolidated financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled as prescribed in FASB ASC 740. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.

Tax positions initially need to be recognized in the financial statements when it is more-likely-than-not the positions will be sustained upon examination by the tax authorities.

Foreign Currency Translation

Transactions denominated in foreign currencies are initially recorded in the functional currency using exchange rates in effect at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using exchange rates prevailing at the end of the reporting period. All exchange gains and losses are included in the statement of operations and deficit.

For the purpose of presenting financial statements in United States Dollars, the assets and liabilities are expressed in United States Dollars using exchange rates prevailing at the end of the reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive loss and reported as cumulative translation adjustment in shareholder's equity.

F-8

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

3. Significant Accounting Policies (continued)

Financial Instruments

Financial Accounting Standards Board’s (FASB) Accounting Standards Codification (ASC) 825, Disclosures about Fair Value of Financial Instruments, requires disclosures of the fair value of financial instruments. The carrying value of the Company’s current financial instruments, which include cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities and shareholder loan, approximates their fair values because of the short-term maturities of these instruments.

Measurement

The Company initially measures its financial instrument at fair value, except for certain non-arm's length transactions.

The Company subsequently measures all its financial assets and financial liabilities at amortized cost, except for investments in equity instruments that are quoted in an active market, which are measured at fair value. Changes in fair value are recognized in earnings for the period in which they occur.

Financial assets measured at amortized cost include cash and cash equivalents and accounts receivable.

Financial liabilities measured at amortized cost include accounts payable and accrued liabilities, and shareholder loan.

Impairment

Financial assets measured at cost are tested for impairment when there are indicators of impairment. The amount of the write-down is recognized in earnings for the period. The previously recognized impairment loss may be reversed to the extent of the improvement, directly or by adjusting the allowance account, provided it is no greater than the amount that would have been reported at the date of the reversal had the impairment not been recognized previously. The amount of the reversal is recognized in earnings for the period.

Transaction costs

The entity recognizes its transaction costs in net income in the period incurred. However, financial instruments that will not be subsequently measure at fair value are adjusted by the transaction costs that are directly attributable to their origination, issuance or assumption.

Impairment of Long-Lived Assets

A long-lived asset is tested for impairment whenever events or changes in circumstances indicate that its carrying value amount may not be recoverable. An impairment loss is recognized when the carrying amount of the asset exceeds the sum of the undiscounted cash flows resulting from its use and eventual disposition. The impairment loss is measured as the amount by which the carrying amount of the long-lived assets exceeds its fair value.

F-9

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

3. Significant Accounting Policies (continued)

Related Party Transactions

All transactions with related parties are in the normal course of operations and are measured at the exchange amount.

Intangible Assets

The useful life of intangible assets is assessed as either finite or indefinite. Following the initial recognition, intangible assets are carried at cost less any accumulated amortization and accumulated impairment losses, if any.

Intangible assets with finite useful lives are carried at cost less accumulated amortization. Amortization is calculated using the straight line method over the estimated useful lives.

Intangible assets with indefinite useful lives are not amortized, but are tested for impairment annually. The assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis. If impairment indicators are present, these assets are subject to an impairment review. Any loss resulting from impairment of intangible assets is expensed in the period the impairment is identified.

Recent Accounting Pronouncements

The Company has considered recent accounting pronouncements during the preparation of these financial statements and does not expect any recent accounting pronouncements to have a material effect on its financial statements.

4. Inventory

Inventory is comprised of:

	2013		2012
Finished goods	$	151,805	$	110,148
Promotional items		1,168		1,168
Raw materials		2,032		1,906
	$	155,005	$	113,222

F-10

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

5. Capital Assets

Major classes of capital assets are as follows:

	2013
	Cost		Accumulated Amortization		Net		2012 Net
Furniture and equipment	$	202	$	121	$	81	$	122
Computers		506		358		148		316
	$	708	$	479	$	229	$	438

6. Intangible Assets

Intangible assets consist of costs incurred to establish the TruXmart Tri-Fold and Smart Fold patent technology. As at December 31, 2013, the patent is still pending and therefore has not been amortized during the period and no impairment charge has been recorded. The patent was issued August 26, 2014.

7. Shareholder Loan

During the year ended December 31, 2011, the Company received funding from its shareholder and director for the purposes of purchasing inventory and funding working capital requirements. The loan had no specific terms of repayment and was non-interest bearing. During the year ended December 31, 2013, the loan was repaid in full.

8. Share Capital

The Company is authorized to issue an unlimited number of Class A common shares. The holders of the Class A common shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares are ranked equally with regards to the Company's residual assets.

As at December 31, 2013, the Company's authorized, issued and outstanding share capital is as follows:

	2013		2012
100 Class A common shares	$	100	$	100

As at December 31, 2013, the Company's net loss per weighted average number of shares outstanding is as follows:

	2013			2012
Net loss for the year	$	(36,935	)	$	(33,457	)
Weighted average number of shares (basic and diluted)		100			100
Loss per weighted average share (basic and diluted)	$	(369	)	$	(335	)

F-11

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

9. Related Party Transactions

During the year ended December 31, 2013, the Company recorded office and general expenses of $48,548 (2012 - $50,219) related to the fair market value of services rendered to the Company by its shareholder. Of this amount, $32,402 (2012 - $50,219) was charged to capital surplus and $16,146 (2012 - $Nil) was charged to the shareholder loan account.

10. Capital Surplus

Balance - December 31, 2011	$	50,551
Fair value of services rendered by shareholder		50,219
Balance - December 31, 2012		100,770
Fair value of services rendered by shareholder		32,402
Balance - December 31, 2013	$	133,172

11. Income Taxes

The income tax expense is reconciled per the schedule below:

	2013			2012
Net loss before income taxes	$	(35,008	)	$	(31,720	)
Fair value of services rendered by shareholder		48,548			50,219
Capital assets		55			(147	)
Non-deductible portion of meals and entertainment		27			51
Other adjustments		(1,190	)		(7,197	)
Adjusted net income for tax purposes		12,432			11,206
Statutory rate		15.50	%		15.50	%
Provision for income taxes	$	1,927		$	1,737

12. Financial Instruments

Credit Risk

The Company is exposed to credit risk on the accounts receivable from its customers. In order to reduce its credit risk, the Company has adopted credit policies which include the analysis of the financial position of its customers and the regular review of their credit balances. The Company incurred bad debt expense of $-Nil during the year ended December 31, 2013 (2012 - $748).

F-12

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

12. Financial Instruments (continued)

Currency Risk

The Company is exposed to currency risk on its sales and purchases denominated in Canadian Dollars. The Company actively manages these risks by adjusting its pricing to reflect currency fluctuations and purchasing foreign currency at advantageous rates.

As at December 31, 2013, cash includes 15,538 Canadian Dollars, accounts receivable includes 15,460 Canadian Dollars, accounts payable and accrued expenses include 45,442 Canadian Dollars and income taxes payable includes 6,718 Canadian Dollars.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its obligations associated with financial liabilities. The Company relies on cash flows generated from operations as well as injections of capital from its shareholder to settle its liabilities when they become due.

Interest Rate Risk

The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary current assets and current liabilities.

Concentration of Supplier Risk

The Company purchases all of its inventory from one supplier source in Asia. The Company carries significant strategic inventories of these materials to reduce the risk associated with this concentration of suppliers. Strategic inventories are managed based on demand. To date, the Company has been able to obtain adequate supplies of the materials used in the production of its products in a timely manner from existing sources. The loss of this key supplier or a delay in shipments could have an adverse effect on its business.

Concentration of Customer Risk

The following table includes the percentage of the Company's sales to significant customers for the fiscal years ended December 31, 2013 and 2012. A customer is considered to be significant if they account for greater than 10% of the Company's annual sales.

	2013		2012
Customer A		25.6		8.8
Customer B		24.2		35.1
Customer C		15.8		-
Customer D		6.0		12.6
		71.6		56.5

The loss of any of these key customers could have an adverse effect on the Company's business.

F-13

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

13. Evaluation of Subsequent Events

Subsequent to December 31, 2013, the Company:

a) Issued 4,691 Class A common shares of the Company, to is existing shareholder as settlement of debt due to the shareholder in the amount of $4,286 (4,691 Canadian Dollars)).

b) Entered into a License Agreement whereby the Company was granted an exclusive license under Patent Rights to make, use, offer for sale, import or sell a proprietary latching system developed and patented by the Company's shareholder (the "Licensor"). The License Agreement allows the Company to manufacture or sub-license the patented latching system and provide services utilizing the patented latching system within the United States and its territories and possessions and any foreign countries where Patent Rights exist. The License Agreement does not require the payment of license issue fees or royalties, however, the Company will be required to maintain any fees or costs associated to keep the patent active. The License Agreement will be in effect for the life of the last-to-expire patent or last-to-be-abandoned patent application licensed under this Agreement, whichever is later. The Company will have the right to terminate the Agreement in whole or as to any portion of Patent Rights at any time by giving such notice to the Licensor. Should the Company violate or fail to perform any term of this Agreement, the Licensor may give written notice of such default ("Notice of Default") to the Company. Should the Company fail to repair such default within sixty days, of the effective date of such notice, the Licensor will have the right to terminate the License Agreement and the licenses therein by a second written notice ("Notice of Termination") to the Company. If a Notice of Termination is sent to the Company, the License Agreement will automatically terminate on the effective date of such notice.

c) Entered into an agreement (the "Advisory Agreement") for the provision of corporate advisory services including, but not limited to, the completion of a Going Public Transaction. Pursuant to the Advisory Agreement, the Company will pay a monthly fee of 5,000 Canadian Dollars (the "Advisory Fee") until May 1, 2016 unless the Advisory Agreement is extended by mutual agreement of the parties. Payment of the Advisory Fee will be deferred until such time as a Going Public Transaction is completed and the Company raises not less than 400,000 Canadian Dollars in its sales of stock and/ or other securities. The Advisory Agreement can be terminated for any reason by either party with ninety days written notice submitted by the party requesting the cancellation. In the event that the cancellation is for cause, the notification period can be reduced to thirty days subject to certain procedural requirements as defined in the Advisory Agreement.

d) Acquired 2,300,000 common shares of Franchise Holdings International Inc. ("NH") from eight separate parties for aggregate consideration of $215,000. The purchase was funded through debt payable to a third-party. The debt is non-interest bearing and does not have any formal terms of repayment. However, the Company expects to re-pay the debt using proceeds from future sales in its stock and/ or other securities following completion of a Going Public Transaction.

F-14

TruXmart Ltd.

Notes to the Financial Statements

For the years ended December 31, 2013 and 2012

13. Evaluation of Subsequent Events (continued)

e) Entered into a Definitive Share Exchange Agreement (the "Share Exchange Agreement") with its sole shareholder and FNHI, whereby the Company's shareholder will exchange all of the issued and outstanding Class A common shares of the Company for 40,000,000 shares of FNHI's common stock (the "Share Exchange"). Following completion of the Share Exchange Agreement, the Company will become a wholly-owned subsidiary of FNHI, and the Company's shareholder will own 40,000,000 of the 40,540,864 issued and outstanding shares of FNHI's common stock representing an ownership interest of 98.6659%.

The Company has evaluated subsequent events through December 17, 2014, which is the date the financial statements were available to be issued.

F-15

Interim Financial Statements

TruXmart Ltd.

For the Nine Months Ended September 30, 2014 and 2013

INDEX

Balance Sheets	F-17
Statements of Operations and Other Comprehensive Loss		F-18
Statements of Cash Flows		F-19
Notes to the Interim Financial Statements		F-20-F-24

F-16

TruXmart Ltd.

Balance Sheets

	September 30, 2014			December 31, 2013
	(Unaudited)
Assets
Current Assets
Cash and cash equivalents	$	40,522		$	17,517
Accounts receivable		32,000			30,233
Inventory (note 4)		66,020			155,005
Prepaid expenses and deposits		48,141			1,520
		186,683			204,275
Capital Assets		73			229
Intangible Assets (note 5)		7,718			7,718
	$	194,474		$	212,222
Liabilities
Current Liabilities
Accounts payable and accrued liabilities	$	159,384		$	159,900
Income taxes payable		5,808			6,316
Shareholder loan (note 6)		-			-
		165,192			166,216
Shareholder's Equity
Share Capital (note 7)		4,386			100
Capital Surplus		146,966			133,172
Cumulative Translation Adjustment		(7,354	)		(2,429	)
Deficit		(114,716	)		(84,837	)
		29,282			46,006
	$	194,474		$	212,222

The accompanying notes form an integral part of these financial statements.

F-17

TruXmart Ltd.

Statements of Operations and Other Comprehensive Loss

For the nine month periods ended September 30, 2014 and 2013

	2014			2013
	(Unaudited)			(Unaudited)
Sales	$	484,218		$	345,775
Cost of Goods Sold		343,956			260,898
Gross Profit		140,262			84,877
Expenses
Amortization		156			157
Bank charges and interest		2,620			2,170
Loss (gain) on foreign exchange		(11,228	)		(1,443	)
Office and general		36,072			39,699
Professional fees		42,989			(544	)
Product development		4,738			659
Rent and utilities		11,712			12,324
Shipping and freight		60,486			33,039
Sales and marketing		22,596			28,543
		170,141			114,604
Loss before Income Taxes		(29,879	)		(29,727	)
Provision for Income Taxes		-			-
Net Loss for the period		(29,879	)		(29,727	)
Other Comprehensive Loss
Currency translation adjustment		(4,925	)		(10	)
Comprehensive Loss for the period	$	(34,804	)	$	(29,737	)

The accompanying notes form an integral part of these financial statements.

F-18

TruXmart Ltd.

Statements of Cash Flows

For the nine month periods ended September 30, 2014 and 2013

	2014			2013
	(Unaudited)			(Unaudited)
Operating Activities
Comprehensive Loss for the period	$	(34,804	)	$	(29,737	)
Items not involving cash:
Amortization		156			157
Fair value of services rendered by shareholder		34,265			36,411
		(383	)		6,831
Net changes in non-cash working capital:
Decrease (increase) in accounts receivable		(1,767	)		13,594
Decrease (increase) in inventory		88,985			44,966
Decrease (increase) in prepaid expenses		(46,621	)		(68	)
Increase (decrease) in income taxes payable		(508	)		(163	)
Increase (decrease) in accounts payable and accrued liabilities		(516	)		(17,561	)
		39,573			40,768
Cash provided by operating activities		39,190			47,599
Investing Activities
Intangible assets		-			(1,942	)
Cash used in investing activities		-			(1,942	)
Financing Activities
Payments to related parties		(22,406	)		(23,049	)
Proceeds from related parties		6,221			-
Cash used in financing activities		(16,185	)		(23,049	)
Change in cash		23,005			22,608
Cash and cash equivalents - beginning of period		17,517			8,677
Cash and cash equivalents - end of period	$	40,522		$	31,285
Significant Non-Cash Transactions Not Disclosed Above
Class A Common Shares issued for settlement of debt	$	4,286		$	-

The accompanying notes form an integral part of these financial statements.

F-19

TruXmart Ltd.

Notes to the Financial Statements

For the nine months ended September 30, 2014 and 2013

1. Nature of Operations

The Company was incorporated under the laws of the Ontario Business Corporations Act on December 13, 2011. The head office of the Company is located at 1895 Clements Road, Unit 155, Pickering, Ontario, Canada.

The Company designs and distributes truck tonneau covers in Canada and the United States.

2. Basis of Presentation

a) Statement of Compliance

The Company's interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") as issued by the Financial Accounting Standards Board ("FASB"). The Company's fiscal year end is December 31.

The interim consolidated financial statements have been prepared without audit in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 31, 2013.

The interim consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s consolidated financial position as of September 30, 2014, the results of its operations for the nine months ended September 30, 2014 and 2013, and its consolidated cash flows for the nine months ended September 30, 2014 and 2013. The results of operations for the nine months ended September 30, 2014 are not necessarily indicative of the results to be expected for future quarters or the full year ending December 31, 2014.

b) Basis of Measurement

The Company's interim financial statements have been prepared on the historical cost basis.

c) Functional and Presentation Currency

These interim financial statements are presented in United States Dollars. The functional currency of the Company is the Canadian Dollar.

d) Use of Estimates

The preparation of interim financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

F-20

TruXmart Ltd.

Notes to the Financial Statements

For the nine months ended September 30, 2014 and 2013

3. Significant Accounting Policies

The accounting polices used in the preparation of these interim financial statements are consistent with those of the Company's audited financial statements for the year ended December 31, 2013.

4. Inventory

Inventory is comprised of:

	September 30, 2014		December 31, 2013
Finished goods	$	62,950	$	151,805
Promotional items		1,026		1,168
Raw materials		2,044		2,032
	$	66,020	$	155,005

5. Intangible Assets

Intangible assets consist of costs incurred to establish the TruXmart Tri-Fold and Smart Fold patent technology. The patent was issued August 26, 2014. No amortization has been recorded as of September 30, 2014 due to the immaterial amount.

6. Shareholder Loan

During the period ended September 30, 2014, the Company received aggregate advances of $6,221 (2013 - $Nil) and made aggregate payments of $22,406 (2013 - $23,049) with its sole shareholder. The advances were non-interest bearing and payable on demand. Also during the period ended September 30, 2014, the Company issued 4,691 Class A common shares of the Company as settlement of debt owed to the shareholder (see note 7).

7. Share Capital

The Company is authorized to issue an unlimited number of Class A common shares. The holders of the Class A common shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares are ranked equally with regards to the Company's residual assets.

During the period ended September 30, 2014, the Company issued 4,691 Class A common shares of the Company to settle debt of 4,691 Canadian Dollars ($4,286) owed to the Company's shareholder.

F-21

TruXmart Ltd.

Notes to the Financial Statements

For the nine months ended September 30, 2014 and 2013

7. Share Capital (continued)

As at September 30, 2014 and December 31, 2013, the Company's authorized, issued and outstanding share capital is as follows:

	2014		2013
4,791 Class A common shares (2013 - 100)	$	4,386	$	100

As at September 30, 2014 and 2013 the Company's net loss per weighted average number of shares outstanding is as follows:

	2014			2013
Net loss for the period	$	(29,879	)	$	(29,727	)
Weighted average number of shares (basic and diluted)		2,677			100
Loss per weighted average share (basic and diluted)	$	(11	)	$	(297	)

8. Related Party Transactions

During the period ended September 30, 2014, the Company recorded office and general expenses of $34,265 (2013 - $36,411) related to the fair market value of services rendered to the Company by its shareholder. Of this amount, $13,794 (2013 - $32,402) was charged to capital surplus and $20,471 (2013 - $4,009) was charged to the shareholder loan account.

9. Financial Instruments

Credit Risk

The Company is exposed to credit risk on the accounts receivable from its customers. In order to reduce its credit risk, the Company has adopted credit policies which include the analysis of the financial position of its customers and the regular review of their credit balances. The Company incurred bad debt expense of $Nil during the period ended September 30, 2014 (2013 - $Nil).

Currency Risk

The Company is exposed to currency risk on its sales and purchases denominated in Canadian Dollars. The Company actively manages these risks by adjusting its pricing to reflect currency fluctuations and purchasing foreign currency at advantageous rates.

As at September 30, 2014, cash includes 14,116 Canadian Dollars, accounts receivable includes 11,710 Canadian Dollars, accounts payable and accrued expenses include 44,268 Canadian Dollars and income taxes payable includes 6,505 Canadian Dollars.

F-22

TruXmart Ltd.

Notes to the Financial Statements

For the nine months ended September 30, 2014 and 2013

9. Financial Instruments (continued)

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its obligations associated with financial liabilities. The Company relies on cash flows generated from operations as well as injections of capital from its shareholder to settle its liabilities when they become due.

Interest Rate Risk

The Company is not exposed to significant interest rate risk due to the short-term maturity of its monetary current assets and current liabilities.

Concentration of Supplier Risk

The Company purchases all of its inventory from one supplier source in Asia. The Company carries significant strategic inventories of these materials to reduce the risk associated with this concentration of suppliers. Strategic inventories are managed based on demand. To date, the Company has been able to obtain adequate supplies of the materials used in the production of its products in a timely manner from existing sources. The loss of this key supplier or a delay in shipments could have an adverse effect on its business.

10. License Agreement

During the period ended September 30, 2014, the Company entered into a License Agreement whereby the Company was granted an exclusive license under Patent Rights to make, use, offer for sale, import or sell a proprietary latching system developed and patented by the Company's shareholder (the "Licensor"). The License Agreement allows the Company to manufacture or sub-license the patented latching system and provide services utilizing the patented latching system within the United States and its territories and possessions and any foreign countries where Patent Rights exist. The License Agreement does not require the payment of license issue fees or royalties, however, the Company will be required to maintain any fees or costs associated to keep the patent active. The License Agreement will be in effect for the life of the last-to-expire patent or last-to-be-abandoned patent application licensed under this Agreement, whichever is later. The Company will have the right to terminate the Agreement in whole or as to any portion of Patent Rights at any time by giving such notice to the Licensor. Should the Company violate or fail to perform any term of this Agreement, the Licensor may give written notice of such default ("Notice of Default") to the Company. Should the Company fail to repair such default within sixty days, of the effective date of such notice, the Licensor will have the right to terminate the License Agreement and the licenses therein by a second written notice ("Notice of Termination") to the Company. If a Notice of Termination is sent to the Company, the License Agreement will automatically terminate on the effective date of such notice.

F-23

TruXmart Ltd. 

Notes to the Financial Statements

For the nine months ended September 30, 2014 and 2013

11. Commitments

During the period ended September 30, 2014, the Company entered into an agreement (the "Advisory Agreement") for the provision of corporate advisory services including, but not limited to, the completion of a Going Public Transaction. Pursuant to the Advisory Agreement, the Company will pay a monthly fee of 5,000 Canadian Dollars (the "Advisory Fee") until May 1, 2016 unless the Advisory Agreement is extended by mutual agreement of the parties. Payment of the Advisory Fee will be deferred until such time as a Going Public Transaction is completed and the Company raises not less than 400,000 Canadian Dollars in its sales of stock and/ or other securities. The Advisory Agreement can be terminated for any reason by either party with ninety days written notice submitted by the party requesting the cancellation. In the event that the cancellation is for cause, the notification period can be reduced to thirty days subject to certain procedural requirements as defined in the Advisory Agreement.

12. Evaluation of Subsequent Events

Subsequent to September 30, 2014, the Company:

a) Acquired 2,300,000 common shares of Franchise Holdings International Inc. ("NH") from eight separate parties for aggregate consideration of $215,000. The purchase was funded through debt payable to a third-party. The debt is non-interest bearing and does not have any formal terms of repayment. However, the Company expects to re-pay the debt using proceeds from future sales in its stock and/ or other securities following completion of a Going Public Transaction.

b) Entered into a Definitive Share Exchange Agreement (the "Share Exchange Agreement") with its sole shareholder and FNHI, whereby the Company's shareholder will exchange all of the issued and outstanding Class A common shares of the Company for 40,000,000 shares of FNHI's common stock (the "Share Exchange"). Following completion of the Share Exchange Agreement, the Company will become a wholly-owned subsidiary of FNHI, and the Company's shareholder will own 40,000,000 of the 40,540,864 issued and outstanding shares of FNHI's common stock representing an ownership interest of 98.6659%.

The Company has evaluated subsequent events through December 17, 2014, which is the date the financial statements were available to be issued. :

F-24

UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

The following unaudited pro forma consolidated financial statements give effect to the reverse acquisition transaction (the "Reverse Acquisition") between Franchise Holdings International Inc. ("FNHI") and TruXmart Ltd. ("TruXmart"). In the Reverse Acquisition, FNHI issued 37,700,000 shares of its common stock to the sole shareholder of TruXmart in exchange for all of the issued and outstanding Class A common shares of TruXmart, which resulted in TruXmart becoming a wholly-owned subsidiary of FNHI. As owners and management of TruXmart have voting and operating control of FNHI following the Reverse Acquisition, the transaction is accounted for as a reverse acquisition.

The unaudited pro forma consolidated financial statements presented below are prepared by applying the acquisition method of accounting to a business combination that is a reverse acquisition. Pro forma adjustments which give effect to certain transactions occurring as a direct result of the Reverse Acquisition are described in the accompanying unaudited notes presented on the following pages. The accompanying unaudited pro forma consolidated statement of operations and other comprehensive loss for the year ended December 31, 2013, and the nine months ended September 30, 2014, present the combined results of operations as if the Reverse Acquisition had occurred on January 1, 2013. The unaudited pro forma consolidated balance sheet as at December 31, 2013 is prepared as though the Reverse Acquisition occurred on December 31, 2013. The unaudited pro forma consolidated balance sheet as September 30, 2014 is prepared as though the Reverse Acquisition occurred on September 30, 2014.

These unaudited pro forma consolidated financial statements are presented for illustrative purposes only and are not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have been realized had FNHI and TruXmart been a combined company during the specified periods. The unaudited pro forma consolidated financial statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, TruXmart's audited financial statements for the years ended December 31, 2013 and 2012, TruXmart's unaudited interim financial statements for the nine month period ended September 30, 2014, FNHI's audited financial statements for the year ended September 30, 2014, FNHI's audited financial statements for the year ended September 30, 2013 as included in its Annual Report on Form 10-K for the year ended September 30, 2013, FNHI's unaudited interim financial statements for the quarter ended December 31, 2013 as included in its Quarterly Report on Form 10-Q for the quarter ended December 31, 2013, and FNHI's unaudited interim financial statements for the quarter ended December 31, 2012 as included in its Quarterly Report on Form 10-Q for the quarter ended December 31, 2012.

F-25

Franchise Holdings International Inc.

Unaudited Pro Forma Consolidated Balance Sheet as at December 31, 2013

	Franchise Holdings International Inc. December 31, 2013 (Unaudited)			TruXmart Ltd. December 31, 2013			Pro Forma Adjustments			Note	Pro Forma Consolidated
Assets
Current Assets
Cash and cash equivalents	$	510		$	17,517		$	-			$	18,027
Accounts receivable		-			30,233			-				30,233
Inventory		-			155,005			-				155,005
Prepaid expenses and deposits		-			1,520			-				1,520
		510			204,275			-				204,785
Capital Assets		-			229			-				229
Intangible Assets		-			7,718			-				7,718
	$	510		$	212,222		$	-			$	212,732
Liabilities
Current Liabilities
Accounts payable and accrued liabilities	$	6,904		$	159,900		$	-			$	166,804
Income taxes payable		-			6,316			-				6,316
		6,904			166,216			-				173,120
Equity
Share Capital		284			100			(100	)	1(b)
								3,770		1(c)		4,054
Capital Surplus		3,918,495			133,172			(19,223	)	1(a)
								(3,899,272	)	1(b)
								(10,348	)	1(b)		122,824
Cumulative Translation Adjustment		-			(2,429	)		-				(2,429	)
Deficit		(3,925,173	)		(84,837	)		19,223		1(a)
								3,905,950		1(b)		(84,837	)
		(6,394	)		46,006			-				39,612
	$	510		$	212,222		$	-			$	212,732

F-26

Franchise Holdings International Inc.

Unaudited Pro Forma Consolidated Balance Sheet as at September 30, 2014

	Franchise Holdings International Inc. September 30, 2014 (Unaudited)			TruXmart Ltd. September 30, 2014 (Unaudited)			Pro Forma Adjustments			Note	Pro Forma Consolidated
Assets
Current Assets
Cash and cash equivalents	$	327		$	40,522		$	-			$	40,849
Accounts receivable		-			32,000			-				32,000
Inventory		-			66,020			-				66,020
Prepaid expenses and deposits		-			48,141			-				48,141
		327			186,683			-				187,010
Capital Assets		-			73			-				73
Intangible Assets		-			7,718			-				7,718
	$	327		$	194,474		$	-			$	194,801
Liabilities
Current Liabilities
Accounts payable and accrued liabilities	$	2,435		$	159,384		$	-			$	161,819
Income taxes payable		-			5,808			-				5,808
		2,435			165,192			-				167,627
Equity
Share Capital		284			4,386			(4,386	)	2(b)
								3,770		2(c)		4,054
Capital Surplus		3,933,308			146,966			(10,527	)	2(a)
								(3,922,781	)	2(b)
								(1,776	)	2(b)		145,190
Cumulative Translation Adjustment		-			(7,354	)		-				(7,354	)
Deficit		(3,935,700	)		(114,716	)		10,527		2(a)
								3,925,173		2(b)		(114,716	)
		(2,108	)		29,282			-				27,174
	$	327		$	194,474		$	-			$	194,801

F-27

Franchise Holdings International Inc.

Unaudited Pro Forma Consolidated Statement of Operations and Other Comprehensive Loss

For the year ended December 31, 2013

	Franchise Holdings International Inc. December 31, 2013 (Unaudited)			TruXmart Ltd. December 31, 2013			Pro-Forma Adjustments			Note	Pro-Forma Consolidated
Sales	$	-		$	465,812		$	-			$	465,812
Cost of Goods Sold		-			347,749			-				347,749
Gross Profit		-			118,063			-				118,063
Expenses
Amortization		-			209			-				209
Bad debts		-			-			-				-
Bank charges and interest		-			2,671			-				2,671
Loss (gain) on foreign exchange		-			(5,852	)		-				5,852
Office and general		19,223			52,395			(19,223	)	1(a)		52,395
Professional fees		-			1,398			-				1,398
Product development		-			659			-				659
Rent and utilities		-			16,325			-				16,325
Shipping and freight		-			51,243			-				51,243
Sales and marketing		-			34,023			-				34,023
		19,223			153,071			(19,223	)			153,071
Loss before Income Taxes		(19,223	)		(35,008	)		19,223				(35,008	)
Provision for Income Taxes		-			1,927			-				1,927
Net Loss for the year		(19,223	)		(36,935	)		19,223				(36,935	)
Other Comprehensive Loss
Currency translation adjustment		-			(804	)		-				(804	)
Comprehensive Loss for the year	$	(19,223	)	$	(37,739	)	$	19,223			$	(37,739	)
Net Loss per Share Basic and diluted											$	-
Weighted Average Number of common shares outstanding											$	40,540,864

F-28

Franchise Holdings International Inc.

Unaudited Pro Forma Consolidated Statement of Operations and Other Comprehensive Loss

For the nine month period ended September 30, 2014

	Franchise Holdings International Inc. September 30, 2014 (Unaudited)			TruXmart Ltd. September 30, 2014 (Unaudited)			Pro-Forma Adjustments			Note	Pro-Forma Consolidated
Sales	$	-		$	484,218		$	-			$	484,218
Cost of Goods Sold		-			343,956			-				343,956
Gross Profit		-			140,262			-				140,262
Expenses
Amortization		-			156			-				156
Bank charges and interest		-			2,620			-				2,620
Loss (gain) on foreign exchange		-			(11,228	)		-				11,228
Office and general		10,527			36,072			(10,527	)	2(a)		36,072
Professional fees		-			42,989			-				42,989
Product development		-			4,738			-				4,738
Rent and utilities		-			11,712			-				11,712
Shipping and freight		-			60,486			-				60,486
Sales and marketing		-			22,596			-				22,596
		10,527			170,141			(10,527	)			170,141
Loss before Income Taxes		(10,527	)		(29,879	)		10,527				(29,879	)
Provision for Income Taxes		-			-			-				-
Net Loss for the year		(10,527	)		(29,879	)		10,527				(29,879	)
Other Comprehensive Loss
Currency translation adjustment		-			(4,925	)		-				(4,925	)
Comprehensive Loss for the year	$	(10,527	)	$	(34,804	)	$	10,527			$	(34,804	)
Net Loss per Share Basic and diluted											$	-
Weighted Average Number of common shares outstanding												40,540,864

F-29

Franchise Holdings International Inc.

Notes to the Unaudited Pro-Forma Consolidated Financial Statements

1.	Pro Forma Adjustments as at December 31, 2013
	The following adjustments were recorded to present the unaudited pro forma consolidated balance sheet as at December 31, 2013, as though the Reverse Acquisition occurred on December 31, 2013:

(a)	To reverse the expenses of FNHI incurred during the year ended December 31, 2013.
(b)	To reverse the balances in the shareholders' equity accounts of FNHI as at December 31, 2013.
(c)	To reflect the par value of the 40,540,864 common shares issued and outstanding following the completion of the Reverse Acquisition. The balance of the value of consideration transferred in excess of the par value of $0.001 per share is charged to Capital Surplus.

2.	Pro Forma Adjustments as at September 30, 2014
	The following adjustments were recorded to present the unaudited pro forma consolidated balance sheet as at September 30, 2014 as though the Reverse Acquisition occurred on September 30, 2014:

(a)	To reverse the expenses of FNHI incurred during the nine month period ended September 30, 2014.
(b)	To reverse the balances in the shareholders' equity accounts of FNHI as at September 30, 2014.
(c)	To reflect the par value of the 40,540,864 common shares issued and outstanding following the completion of the Reverse Acquisition. The balance of the value of consideration transferred in excess of the par value of $0.001 per share is charged to Capital Surplus.

3.	Pro Forma Basic and Diluted Loss Per Common Share
	Pro forma basic and diluted loss per common share is based on the weighted average number of common shares which would have been outstanding during the period if the Revere Acquisition had occurred at January 1, 2013.

F-30

EX-10.1

EXHIBIT 10.1

DEFINITIVE SHARE EXCHANGE AGREEMENT

This three party Definitive Share Exchange Agreement (“Agreement”), dated as of December 16, 2014, is between TruXmart Ltd. (“TruXmart”), an Ontario, Canadian corporation located at 1895 Clements Road—Suite 155, Pickering, Ontario CANADA L1W 3R8, Steven Rossi (“Rossi”), the sole shareholder of TruXmart, and Franchise Holdings International, Inc. (“FNHI”), located at 1895 Clements Road—Suite 155, Pickering, Ontario CANADA L1W 3R8 (formerly at 5910 South University Boulevard, C-18, Unit 165, Littleton, Colorado 80121-2800). Collectively, Rossi, TruXmart and FNHI are the “Parties.”

The parties hereby enter into this Agreement, following which,

1.	FNHI will own 4,791 common shares of TruXmart, representing all of its issued and outstanding shares;
2.	Rossi will own 40,000,000 shares of FNHI common shares, and shares of FNHI representing 92.9925914% of FNHI’s outstanding shares (the “Share Exchange”), calculated post-issuance;
3.	TruXmart will relinquish its 2,300,000 common shares of FNHI, to Rossi, in becoming the wholly-owned subsidiary of FNHI.

As a result of this Agreement, FNHI will be filing a Form 8-K reflecting this change of control (sometimes called a “Super 8-K”). As a result of this acquisition, FNHI has adopted the fiscal year end of TruXmart, namely December 31. The first consolidated post-acquisition report will be the Form 10-K for the fiscal year ended December 31, 2014.

RECITALS

WHEREAS, Rossi currently holds all 4,791 Class A common shares, with a stated capital of $4,791 (all figures in Canadian dollars) issued and outstanding shares of TruXmart and is desirous of relinquishing all of his TruXmart shares so that he would own 40,000,000 shares of FNHI common stock and that 40,540,864 shares of FNHI common stock would be outstanding; his ownership would represent 92.9925914% of FNHI’s outstanding shares; and that TruXmart would be a wholly-owned subsidiary of FNHI.

WHEREAS, TruXmart currently owns 2,300,000 common shares of FNHI, representing an 80.961285% ownership, and is desirous of becoming a wholly-owned subsidiary of FNHI, a fully reporting public company, relinquishing its 2,300,000 shares of FNHI in the process.

WHEREAS, FNHI and TruXmart are desirous of FNHI acquiring 100% of the outstanding shares of TruXmart, issuing 37,700,000 shares of FNHI common stock in the process, making TruXmart a wholly-owned subsidiary of FNHI.

WHEREAS, the board of directors and shareholders of FNHI and TruXmart, respectively, have each agreed to exchange and issue shares, as necessary to cause the forgoing results (the “Share Exchange”), upon the terms, and subject to the conditions, set forth in this Agreement, including increasing the authorized shares of FNHI common stock to 100,000,000.

1

WHEREAS, it is intended that, for federal income tax purposes, the Share Exchange shall qualify as a reorganization under the provisions of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended (the “Code”), and the rules and regulations promulgated thereunder, and be tax-free pursuant to Section 351(a) of the Code.

WHEREAS, the Parties desire to make certain representations, warranties, covenants and agreements in connection with this Agreement.

NOW, THEREFORE, in consideration of the premises and mutual promises herein made, and in consideration of the representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, the Parties agree as follows:

INCORPORATION OF RECITALS BY REFERENCE. The Recitals are hereby incorporated herein by this reference, as if fully restated herein.

ARTICLE I
DEFINITIONS

I.1 Certain Definitions. The following terms shall, when used in this Agreement, have the following meanings:

“Acquisition” means the acquisition of any businesses, assets or property other than in the ordinary course, whether by way of the purchase of assets or stock, by FNHI acquiring all of the outstanding shares of TruXmart pursuant to this Share Exchange Agreement and TruXmart relinquishing and exchanging its shares of FNHI to Rossi.

“Affiliate” means, with respect to any Person: (i) any Person directly or indirectly owning, controlling or holding with power to vote ten percent (10%) or more of the outstanding voting securities of such other Person (other than passive or institutional investors); (ii) any Person ten percent (10%) or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person; (iii) any Person directly or indirectly controlling, controlled by or under common control with such other Person; and (iv) any officer, director or partner of such other Person. “Control” for the foregoing purposes shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or voting interests, by contract or otherwise.

“Business Day” means any day other than Saturday, Sunday or a day on which banking institutions in Los Angeles, California, are required or authorized to be closed.

“Code” means the United States Internal Revenue Code of 1986, as amended.

“Collateral Documents” mean the Exhibits and any other documents, instruments and certificates to be executed and delivered by the Parties hereunder or there under.

“Commission” means the Securities and Exchange Commission or any Regulatory Authority that succeeds to its functions.

“Effective Time” means, the moment in time when the shares of the FNHI are exchanged for the shares of FNHI.

2

“Encumbrance” means any material mortgage, pledge, lien, encumbrance, charge, security interest, security agreement, conditional sale or other title retention agreement, limitation, option, assessment, restrictive agreement, restriction, adverse interest, restriction on transfer or exception to or material defect in title or other ownership interest (including restrictive covenants, leases and licenses).

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations there under.

“GAAP” means United States generally accepted accounting principles as in effect from time to time.

“Legal Requirement” means any statute, ordinance, law, rule, regulation, code, injunction, judgment, order, decree, ruling, or other requirement enacted, adopted or applied by any Regulatory Authority, including judicial decisions applying common law or interpreting any other Legal Requirement.

“Losses” shall mean all damages, awards, judgments, assessments, fines, sanctions, penalties, charges, costs, expenses, payments, diminutions in value and other losses, however suffered or characterized, all interest thereon, all costs and expenses of investigating any claim, lawsuit or arbitration and any appeal there from, all actual attorneys’, accountants’ investment bankers’ and expert witness’ fees incurred in connection therewith, whether or not such claim, lawsuit or arbitration is ultimately defeated and, subject to Section 9.4, all amounts paid incident to any compromise or settlement of any such claim, lawsuit or arbitration.

“Liability” means any liability or obligation (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.

“Material Adverse Effect” means a material adverse effect on (i) the assets, Liabilities, properties or business of the Parties, (ii) the validity, binding effect or enforceability of this Agreement or the Collateral Documents or (iii) the ability of any Party to perform its obligations under this Agreement and the Collateral Documents; provided, however, that none of the following shall constitute a Material Adverse Effect on FNHI: (i) the filing, initiation and subsequent prosecution, by or on behalf of shareholders of any Party, of litigation that challenges or otherwise seeks damages with respect to the Share Exchange, this Agreement and/or transactions contemplated thereby or hereby, (ii) occurrences due to a disruption of a Party’s business as a result of the announcement of the execution of this Agreement or changes caused by the taking of action required by this Agreement, (iii) general economic conditions, or (iv) any changes generally affecting the industries in which a Party operates.

“Exchange Shares” means the 4,791 Class A issued and outstanding common shares of TruXmart (the “TruXmart Shares”), exchanged by Rossi to FNHI, for 37,700,000 newly issued shares of FNHI (the “FNHI Shares”), to be issued to Rossi and the 2,300,000 FNHI shares presently held by TruXmart, to be transferred to Rossi.

“FNHI Business” means the business conducted by FNHI.

“FNHI Common Stock” means the common shares of FNHI.

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“FNHI Securities Filings” means FNHI’s Annual Report on Form 10-K and its quarterly reports on Form 10-Q, and all other reports filed and to be filed with the Commission prior to the Effective Time.

“Permit” means any license, permit, consent, approval, registration, authorization, qualification or similar right granted by a Regulatory Authority.

“Permitted Liens” means (i) liens for Taxes not yet due and payable or being contested in good faith by appropriate proceedings; (ii) rights reserved to any Regulatory Authority to regulate the affected property; (iii) statutory liens of banks and rights of set off; (iv) as to leased assets, interests of the lessors and sub-lessors thereof and liens affecting the interests of the lessors and sub-lessors thereof; (v) inchoate material men’s, mechanics’, workmen’s, repairmen’s or other like liens arising in the ordinary course of business; (vi) liens incurred or deposits made in the ordinary course in connection with workers’ compensation and other types of social security; (vii) licenses of trademarks or other intellectual property rights granted by FNHI, in the ordinary course and not interfering in any material respect with the ordinary course of the business of FNHI; and (viii) as to real property, any encumbrance, adverse interest, constructive or other trust, claim, attachment, exception to or defect in title or other ownership interest (including, but not limited to, reservations, rights of entry, rights of first refusal, possibilities of reversion, encroachments, easement, rights of way, restrictive covenants, leases, and licenses) of any kind, which otherwise constitutes an interest in or claim against property, whether arising pursuant to any Legal Requirement, under any contract or otherwise, that do not, individually or in the aggregate, materially and adversely affect or impair the value or use thereof as it is currently being used in the ordinary course.

“Person” means any natural person, corporation, partnership, trust, unincorporated organization, association, Limited Liability Company, Regulatory Authority or other entity.

“Proposed Acquisition” means any of the following transactions (other than the transactions contemplated by this Agreement): (i) a merger, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving FNHI pursuant to which the shareholders of FNHI immediately preceding such transaction hold less than fifty percent (50%) of the aggregate equity interests in the surviving or resulting entity of such transaction, (ii) a sale or other disposition by FNHI of assets representing in excess of fifty percent (50%) of the aggregate fair market value of FNHI Business immediately prior to such sale or (iii) the acquisition by any person or group (including by way of a tender offer or an exchange offer or issuance by FNHI), directly or indirectly, of beneficial ownership or a right to acquire beneficial ownership of shares representing in excess of fifty percent (50%) of the voting power of the then outstanding shares of capital stock of FNHI.

“Regulatory Authority” means: (i) the United States of America; (ii) any state, commonwealth, territory or possession of the United States of America and any political subdivision thereof (including counties, municipalities and the like); (iii) Canada and any other foreign (as to the United States of America) sovereign entity and any political subdivision thereof; or (iv) any agency, authority or instrumentality of any of the foregoing, including any court, tribunal, department, bureau, commission or board.

“Representative” means any director, officer, employee, agent, consultant, advisor or other representative of a Person, including legal counsel, accountants and financial advisors.

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“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations there under.

“Subsidiary” of a specified Person means (a) any Person if securities having ordinary voting power (at the time in question and without regard to the happening of any contingency) to elect a majority of the directors, trustees, managers or other governing body of such Person are held or controlled by the specified Person or a Subsidiary of the specified Person; (b) any Person in which the specified Person and its subsidiaries collectively hold a fifty percent (50%) or greater equity interest; (c) any partnership or similar organization in which the specified Person or subsidiary of the specified Person is a general partner; or (d) any Person the management of which is directly or indirectly controlled by the specified Person and its Subsidiaries through the exercise of voting power, by contract or otherwise.

“Tax” means any U.S. or non U.S. federal, state, provincial, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, intangible property, recording, occupancy, sales, use, transfer, registration, value added minimum, estimated or other tax of any kind whatsoever, including any interest, additions to tax, penalties, fees, deficiencies, assessments, additions or other charges of any nature with respect thereto, whether disputed or not.

“Tax Return” means any return, declaration, report, claim for refund or credit or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

“Treasury Regulations” means regulations promulgated by the U.S. Treasury Department under the Code.

ARTICLE II
THE SHARE EXCHANGE

II.1 Share Exchange. In accordance with and subject to the provisions of this Agreement and the Nevada Corporations, Partnerships and Associations Law Annotated (the “Code”), at the Effective Time, TruXmart shall become a wholly-owned subsidiary of FNHI, and FNHI shall be its only shareholder and shall continue in its existence with one owner, FNHI, until a merger, if any. Pursuant to the Share Exchange, Rossi is relinquishing all of his 4,791Class A TruXmart common shares, constituting all issued and outstanding shares of TruXmart (the “TruXmart Shares”), and is acquiring 40,000,000 shares of FNHI (the “FNHI Shares”), representing 92.9925914% of the outstanding shares of FNHI; FNHI is issuing 37,700,000 of its shares, and is acquiring the 4,791TruXmart Shares; TruXmart is transferring to Rossi, its 2,300,000 shares of FNHI and becoming the wholly-owned subsidiary of FNHI.

II.2 Stock Transfer Books. Effective immediately, the stock transfer books of FNHI shall be closed, and there shall be no further issuance or registration of transfers of shares hereafter on the records of FNHI.

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II.3 Restriction on Transfer. The Exchange Shares may not be sold, transferred, or otherwise disposed of without registration under the Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Share Exchange Shares or any available exemption from registration under the Act, the Share Exchange Shares must be held indefinitely. The Parties are aware that the Share Exchange Shares may not be sold pursuant to Rule 144 promulgated under the Act unless all of the conditions of that Rule are met. Among the conditions for use of Rule 144 may be the availability of current information to the public about the Surviving Company.

II.4 Restrictive Legend. All certificates representing the Exchange Shares shall contain an appropriate restrictive legend.

II.5 Closing. The closing of the transactions contemplated by this Agreement and the Collateral Documents (the “Closing”) shall take place via conference call at the offices of Carl N. Duncan, Esq., Securities Counselors, Inc., 5718 Tanglewood Drive, Bethesda, Maryland 20817, or at such other location as the parties may agree at 10:00 AM, EST Time on the agreed date, which, shall be concurrent with the signing hereof (the “Closing Date”).

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF FNHI

FNHI represents and warrants to Rossi that the statements contained in this ARTICLE III are correct and complete as of the date of this Agreement and, except as provided in Section 7.1, will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this ARTICLE III, except in the case of representations and warranties stated to be made as of the date of this Agreement or as of another date and except for changes contemplated or permitted by this Agreement).

III.1 Organization and Qualification. FNHI is a corporation duly organized, validly existing and in good standing under the laws of its respective jurisdiction of organization. FNHI has all requisite power and authority to own, lease and use its assets as they are currently owned, leased and used and to conduct its business as it is currently conducted. FNHI is duly qualified or licensed to do business in and is in good standing in each jurisdiction in which the character of the properties owned, leased or used by it or the nature of the activities conducted by it make such qualification necessary, except any such jurisdiction where the failure to be so qualified or licensed would not have a Material Adverse Effect on FNHI or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of FNHI to perform its obligations under this Agreement or any of the Collateral Documents.

III.2 Capitalization.

(a) The authorized capital stock and other ownership interests of FNHI, a Nevada corporation, consists of 20,000,000 common shares of Common Stock, of which 2,840,864 were issued and outstanding as of November 30, 2014. FNHI has no shares of Preferred Stock authorized. All of the outstanding FNHI Common have been duly authorized and are validly issued, fully paid and non-assessable.

(b) Other than what has been described herein or in FNHI’s SEC Documents, there are no outstanding or authorized options, warrants, purchase rights, preemptive rights or other contracts or commitments that could require FNHI to issue, sell, or otherwise cause to become outstanding any of its capital stock or other ownership interests (collectively “Options”).

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(c) All of the issued and outstanding shares of FNHI Common Stock have been duly authorized and are validly issued and outstanding, fully paid and non-assessable and have been issued in compliance with applicable securities laws and other applicable Legal Requirements or transfer restrictions under applicable securities laws.

III.3 Authority and Validity. FNHI has all requisite corporate power to execute and deliver, to perform its obligations under, and to consummate the transactions contemplated by, this Agreement (subject to the approval of FNHI Shareholders as contemplated herein and subject to the receipt of any necessary consents, approvals, authorizations or other matters referred to herein). The execution and delivery by FNHI of, the performance by FNHI of its obligations under, and the consummation by FNHI of the transactions contemplated by, this Agreement have been duly authorized by all requisite action of FNHI (subject to the approval of FNHI Shareholders as contemplated herein). This Agreement has been duly executed and delivered by FNHI and (assuming due execution and delivery by Rossi and approval by FNHI Shareholders) is the legal, valid and binding obligation of FNHI, enforceable against it in accordance with its terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles. Upon the execution and delivery of the Collateral Documents by each Person (other than by Rossi) that is required by this Agreement to execute, or that does execute, this Agreement or any of the Collateral Documents, and assuming due execution and delivery thereof by Rossi, the Collateral Documents will be the legal, valid and binding obligations of FNHI, enforceable against FNHI in accordance with their respective terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles.

III.4 No Breach or Violation. Subject to obtaining the consents, approvals, authorizations, and orders of and making the registrations or filings with or giving notices to Regulatory Authorities and Persons identified herein, the execution, delivery and performance by FNHI of this Agreement and the Collateral Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof, do not and will not conflict with, constitute a violation or breach of, constitute a default or give rise to any right of termination or acceleration of any right or obligation of FNHI under, or result in the creation or imposition of any Encumbrance upon FNHI, FNHI Assets, FNHI Business or FNHI Common Stock by reason of the terms of (i) the articles of incorporation, by laws or other charter or organizational document of FNHI or any Subsidiary of FNHI, (ii) any material contract, agreement, lease, indenture or other instrument to which FNHI is a party or by or to which FNHI, or the Assets may be bound or subject and a violation of which would result in a Material Adverse Effect on FNHI, (iii) any order, judgment, injunction, award or decree of any arbitrator or Regulatory Authority or any statute, law, rule or regulation applicable to FNHI or (iv) any Permit of FNHI, which in the case of (ii), (iii) or (iv) above would have a Material Adverse Effect on FNHI or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of FNHI to perform its obligations under this Agreement or any of the Collateral Documents.

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III.5 Consents and Approvals. Except for requirements described in Schedule 3.5, no consent, approval, authorization or order of, registration or filing with, or notice to, any Regulatory Authority or any other Person is necessary to be obtained, made or given by FNHI in connection with the execution, delivery and performance by FNHI of this Agreement or any Collateral Document or for the consummation by FNHI of the transactions contemplated hereby or thereby, except to the extent the failure to obtain any such consent, approval, authorization or order or to make any such registration or filing would not have a Material Adverse Effect on FNHI or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of FNHI to perform its obligations under this Agreement or any of the Collateral Documents.

III.6 Intellectual Property. FNHI warrants that it has good title to or the right to use all material company intellectual property rights and all material inventions, processes, designs, formulae, trade secrets and know how necessary for the operation of FNHI Business without the payment of any royalty or similar payment.

III.7 Compliance with Legal Requirements. FNHI has operated its business in compliance with all Legal Requirements applicable to FNHI except to the extent the failure to operate in compliance with all material Legal Requirements would not have a Material Adverse Effect on FNHI or Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.

III.8 Litigation. There are no outstanding judgments or orders against or otherwise affecting or related to FNHI, FNHI Business or FNHI Assets and there is no action, suit, complaint, proceeding or investigation, judicial, administrative or otherwise, that is pending or, to FNHI’s knowledge, threatened that, if adversely determined, would have a Material Adverse Effect on FNHI or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents, except as noted in the audited Company Financial Statements or documented by FNHI to Rossi.

III.9 Taxes. FNHI has duly and timely filed in proper form all Tax Returns for all Taxes required to be filed with the appropriate Regulatory Authority, and has paid all taxes required to be paid in respect thereof except where such failure would not have a Material Adverse Effect on FNHI, except where, if not filed or paid, the exception(s) have been documented by FNHI to Rossi.

III.10 Books and Records. The books and records of FNHI accurately and fairly represent FNHI Business and its results of operations in all material respects.

III.11 Brokers or Finders. All negotiations relative to this Agreement and the transactions contemplated hereby have been carried out by FNHI and/or its Affiliates/Representatives in connection with the transactions contemplated by this Agreement, neither FNHI, nor any of its Affiliates/Representatives have incurred any obligation to pay any brokerage or finder’s fee or other commission in connection with the transaction contemplated by this Agreement.

III.12 Disclosure. No representation or warranty of FNHI in this Agreement or in the Collateral Documents and no statement in any certificate furnished or to be furnished by FNHI pursuant to this Agreement contained, contains or will contain on the date such agreement or certificate was or is delivered, or on the Closing Date, any untrue statement of a material fact, or omitted, omits or will omit on such date to state any material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.

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III.13 No Undisclosed Liabilities. FNHI is not subject to any material liability (including unasserted claims), absolute or contingent, which is not shown or which is in excess of amounts shown or reserved for in the balance sheet as of December 15, 2014 other than liabilities of the same nature as those set forth in FNHI Financial Statements and reasonably incurred in the ordinary course of its business after November 30, 2014.

III.14 Absence of Certain Changes. Since November 30, 2014, FNHI has not: (a) suffered any material adverse change in its financial condition, assets, liabilities or business; (b) contracted for or paid any capital expenditures; (c) incurred any indebtedness or borrowed money, issued or sold any debt or equity securities, declared any dividends or discharged or incurred any liabilities or obligations except in the ordinary course of business as heretofore conducted; (d) mortgaged, pledged or subjected to any lien, lease, security interest or other charge or encumbrance any of its properties or assets; (e) paid any material amount on any indebtedness prior to the due date, forgiven or cancelled any material amount on any indebtedness prior to the due date, forgiven or cancelled any material debts or claims or released or waived any material rights or claims; (f) suffered any damage or destruction to or loss of any assets (whether or not covered by insurance); (g) acquired or disposed of any assets or incurred any liabilities or obligations; (h) made any payments to its affiliates or associates or loaned any money to any person or entity; (i) formed or acquired or disposed of any interest in any corporation, partnership, limited liability company, joint venture or other entity; (j) entered into any employment, compensation, consulting or collective bargaining agreement or any other agreement of any kind or nature with any person. Or group, or modified or amended in any respect the terms of any such existing agreement; (k) entered into any other commitment or transaction or experience any other event that relates to or affect in any way this Agreement or to the transactions contemplated hereby, or that has affected, or may adversely affect FNHI Business, operations, assets, liabilities or financial condition; or (1) amended its Articles of Incorporation or By-laws, except as otherwise contemplated herein.

III.15 Contracts. A true and complete list of all contracts, agreements, leases, commitments or other understandings or arrangements, written or oral, express or implied, to which FNHI is a party or by which it or any of its property is bound or affected requiring payments to or from, or incurring of liabilities by, FNHI in excess of $100,000 (the “Contracts”). The Company has complied with and performed, in all material respects, all of its obligations required to be performed under and is not in default with respect to any of the Contracts, as of the date hereof, nor has any event occurred which has not been cured which, with or without the giving of notice, lapse of time, or both, would constitute a default in any respect there under. To the best knowledge of FNHI, no other party has failed to comply with or perform, in all material respects, any of its obligations required to be performed under or is in material default with respect to any such Contracts, as of the date hereof, nor has any event occurred which, with or without the giving of notice, lapse of time or both, would constitute a material default in any respect by such party there under. FNHI knows of and has no reason to believe that there are any facts or circumstances which would make a material default by any party to any contract or obligation likely to occur subsequent to the date hereof.

III.16 Permits and Licenses. FNHI has all certificates of occupancy, rights, permits, certificates, licenses, franchises, approvals and other authorizations as are reasonably necessary to conduct its business and to own, lease, use, operate and occupy its assets, at the places and in the manner now conducted and operated, except those the absence of which would not materially adversely affect its business. FNHI has not received any written or oral notice or claim pertaining to the failure to obtain any material permit, certificate, license, approval or other authorization required by any federal, state or local agency or other regulatory body, the failure of which to obtain would materially and adversely affect its business.

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III.17 Assets Necessary to Business. FNHI owns or leases all properties and assets, real, personal, and mixed, tangible and intangible, and is a party to all licenses, permits and other agreements necessary to permit it to carry on its business as presently conducted.

III.18 Labor Agreements and Labor Relations. FNHI has no collective bargaining or union contracts or agreements. FNHI is in compliance with all applicable laws respecting employment and employment practices, terms and conditions of employment and wages and hours, and is not engaged in any unfair labor practices; there are no charges of discrimination or unfair labor practice charges” or complaints against FNHI pending or threatened before any governmental or regulatory agency or authority; and, there is no labor strike, dispute, slowdown or stoppage actually pending or threatened against or affecting FNHI.

III.19 Employment Arrangements. FNHI has no employment or consulting agreements or arrangements, written or oral, which are not terminable at the will of FNHI, or any pension, profit-sharing, option, other incentive plan, or any other type of employment benefit plan as defined in ERISA or otherwise, or any obligation to or customary arrangement with employees for bonuses, incentive compensation, vacations, severance pay, insurance or other benefits. No employee of FNHI is in violation of any employment agreement or restrictive covenant.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF ROSSI

Rossi represents and warrants to FNHI that the statements contained in this ARTICLE IV are correct and complete as of the date of this Agreement and, except as provided in Section 8.1, will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this ARTICLE IV, except in the case of representations and warranties stated to be made as of the date of this Agreement or as of another date and except for changes contemplated or permitted by the Agreement).

IV.1 Organization and Qualification. Rossi has all requisite power and authority to own, lease and use TruXmart’s assets as they are currently owned, leased and used and to conduct its business as it is currently conducted. Rossi is duly qualified or licensed to do business in and are each in good standing in each jurisdiction in which the character of the properties owned, leased or used by it or the nature of the activities conducted by it makes such qualification necessary, except any such jurisdiction where the failure to be so qualified or licensed and in good standing would not have a Material Adverse Effect on the Rossi or a Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of FNHI or Rossi to perform his or its obligations under this Agreement or any of the Collateral Documents.

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IV.2 Capitalization.

(a) The authorized capital stock of TruXmart is unlimited. All outstanding shares of TruXmart Common Stock are owned by Steven Rossi, TruXmart’s President, consisting of 4,791 shares. TruXmart has no shares of Preferred Stock authorized. All 4,791 Shares of Common Stock are duly issued and outstanding, and have been duly authorized, validly issued and outstanding and fully paid and non-assessable, which shares are exchanged hereby, as above provided.

(b) There are no outstanding or authorized options, warrants, purchase rights, preemptive rights or other contracts or commitments that could require TruXmart or any of its Subsidiaries to issue, sell, or otherwise cause to become outstanding any of its capital stock or other ownership interests.

(c) All of the issued and outstanding shares of the TruXmart Capital Stock have been duly authorized and are validly issued and outstanding, fully paid and non-assessable (with respect to Subsidiaries that are corporations) and have been issued in compliance with applicable securities laws and other applicable Legal Requirements.

IV.3 Authority and Validity. Rossi has all requisite power to execute and deliver to perform his obligations under, and to consummate the transactions contemplated by, this Agreement and the Collateral Documents. The execution and delivery by Rossi and the performance by Rossi of his obligations under, and the consummation by Rossi of the transactions contemplated by, this Agreement and the Collateral Documents have been duly authorized by all requisite action of Rossi. This Agreement has been duly executed and delivered (assuming due execution and delivery by Rossi) is the legal, valid and binding obligation of Rossi, enforceable in accordance with its terms except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles. Upon the execution and delivery by Rossi of the Collateral Documents to which he is a party, and assuming due execution and delivery thereof by the other parties thereto, the Collateral Documents will be the legal, valid and binding obligations, enforceable in accordance with their respective terms except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles.

IV.4 No Breach or Violation. Subject to obtaining the consents, approvals, authorizations, and orders of and making the registrations or filings with or giving notices to Regulatory Authorities and Persons identified herein, the execution, delivery and performance by Rossi of this Agreement and the Collateral Documents to which he is a party and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof, do not and will not conflict with, constitute a violation or breach of, constitute a default or give rise to any right of termination or acceleration of any right or obligation of Rossi under, or result in the creation or imposition of any Encumbrance upon the property of Rossi by reason of the terms of (i) the articles of incorporation, by laws or other charter or organizational document of TruXmart , (ii) any contract, agreement, lease, indenture or other instrument to which any the Rossi or TruXmart is a party or by or to which Rossi or TruXmart or its property may be bound or subject and a violation of which would result in a Material Adverse Effect on Rossi or TruXmart taken as a whole, (iii) any order, judgment, injunction, award or decree of any arbitrator or Regulatory Authority or any statute, law, rule or regulation applicable to Rossi or TruXmart or (iv) any Permit of TruXmart or subsidiary, which in the case of (ii), (iii) or (iv) above would have a Material Adverse Effect on TruXmart or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of Rossi or TruXmart to perform its obligations hereunder or there under.

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IV.5 Consents and Approvals. Except for requirements under applicable United States or state securities laws, no consent, approval, authorization or order of, registration or filing with, or notice to, any Regulatory Authority or any other Person is necessary to be obtained, made or given by Rossi in connection with the execution, delivery and performance by them of this Agreement or any Collateral Documents or for the consummation by them of the transactions contemplated hereby or thereby, except to the extent the failure to obtain such consent, approval, authorization or order or to make such registration or filings or to give such notice would not have a Material Adverse Effect on Rossi or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of Rossi to perform his obligations under this Agreement or any of the Collateral Documents.

IV.6 Compliance with Legal Requirements. TruXmart’s Business has operated in compliance with all material Legal Requirements including, without limitation, the Exchange Act and the Securities Act applicable to TruXmart, except to the extent the failure to operate in compliance with all material Legal Requirements, would not have a Material Adverse Effect on TruXmart or a Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.

IV.7 Litigation. There are no outstanding judgments or orders against or otherwise affecting or related to TruXmart, or the business or assets; and there is no action, suit, complaint, proceeding or investigation, judicial, administrative or otherwise, that is pending or, to the best knowledge of the Rossi, threatened that, that has not been disclosed and if adversely determined, would have a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.

IV.8 Ordinary Course. Since the date of its most recent balance sheet, there has not been any occurrence, event, incident, action, failure to act or transaction involving TruXmart, which is reasonably likely, individually or in the aggregate, to have a Material Adverse Effect on TruXmart.

IV.9 Assets and Liabilities. As of the date of this Agreement, neither TruXmart nor any of its Subsidiaries has any Assets or Liability, except for the (i) Liabilities disclosed in the balance sheet disclosed to FNHI through the date hereof and (ii) described in the “Executive Summary: TruXmart Ltd.” attached hereto as Exhibit B.

IV.10 Taxes. TruXmart, and any Subsidiaries, has duly and timely filed in proper form all Tax Returns for all Taxes required to be filed with the appropriate Governmental Authority, except where such failure to file would not have a Material Adverse Effect on TruXmart.

IV.11 Books and Records. The books and records of TruXmart and any Subsidiaries accurately and fairly represent the TruXmart Business and its results of operations in all material respects. All accounts receivable and inventory of the TruXmart Business are reflected properly on such books and records in all material respects.

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IV.12 Financial and Other Information.

(a) Two years of audited historical financial statements of TruXmart and any Subsidiaries will be prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby (except as may be indicated in the notes thereto), and present fairly the financial condition of TruXmart and its results of operations as of the dates and for the periods indicated, subject in the case of the unaudited financial statements only to normal year-end adjustments (none of which will be material in amount) and the omission of footnotes.

(b) To the knowledge of current management, TruXmart’s financials do not contain (directly or by incorporation by reference) any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein (or incorporated therein by reference), in light of the circumstances under which they were or will be made, not misleading.

IV.13 Brokers or Finders. All negotiations relative to this Agreement and the transactions contemplated hereby have been carried out by TruXmart and/or its Affiliates/Representatives in connection with the transactions contemplated by this Agreement, neither TruXmart, nor any of its Affiliates/Representatives have incurred any obligation to pay any brokerage or finder’s fee or other commission in connection with the transaction contemplated by this Agreement.

IV.14 Disclosure. No representation or warranty of Rossi in this Agreement or in the Collateral Documents and no statement in any certificate furnished or to be furnished by Rossi pursuant to this Agreement contained, contains or will contain on the date such agreement or certificate was or is delivered, or on the Closing Date, any untrue statement of a material fact, or omitted, omits or will omit on such date to state any material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.

IV.15 Filings. Neither TruXmart nor Rossi is subject to filings required by the Securities Act of 1933, as amended, and the Exchange Act of 1934, as amended. Once TruXmart acquires control of FNHI, TruXmart and Rossi will make filings required to be made under such statutes and no such filing will contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, not misleading.

IV.16 Conduct of Business. Prior to the Closing Date, TruXmart shall conduct its business in the normal course, and shall not sell, pledge, or assign any assets, without the prior written approval of FNHI, except in the regular course of business. Except as otherwise provided herein, TruXmart shall not amend its Articles of Incorporation or By-Laws, declare dividends, redeem or sell stock or other securities, acquire or dispose of fixed assets, change employment terms, enter into any material or long-term contract, guarantee obligations of any third party, settle or discharge any material balance sheet receivable for less than its stated amount, pay more on any liability than its stated amount or enter into any other transaction other than in the regular course of business.

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ARTICLE V
COVENANTS OF FNHI

Between the date of this Agreement and the Closing Date:

V.1 Additional Information. FNHI shall provide to Rossi and his Representatives such financial, operating and other documents, data and information relating to FNHI, FNHI Business and FNHI Assets and Liabilities, as Rossi or his Representatives may reasonably request. In addition, FNHI shall take all action necessary to enable Rossi and his Representatives to review, inspect and review FNHI Assets, FNHI Business and Liabilities of FNHI and discuss them with FNHI’s officers, employees, independent accountants, customers, licensees, and counsel. Not-withstanding any investigation that Rossi may conduct of FNHI, FNHI Business, FNHI Assets and the Liabilities of FNHI, Rossi may fully rely on FNHI’s warranties, covenants and indemnities set forth in this Agreement.

V.2 Consents and Approvals. As soon as practicable after execution of this Agreement, FNHI shall use commercially reasonable efforts to obtain any necessary consent, approval, authorization or order of, make any registration or filing with or give any notice to, any Regulatory Authority or Person as is required to be obtained, made or given by FNHI to consummate the transactions contemplated by this Agreement and the Collateral Documents.

V.3 Non-circumvention. It is understood that in connection with the transactions contemplated hereby, Rossi has been and will be seeking to find investors willing to provide loans and/or capital investments to finance business plans. In connection therewith, FNHI will not, and it will cause its directors, officers, employees, agents and representatives not to attempt, directly or indirectly, (i) to contact any party introduced to it by Rossi, or (ii) deal with, or otherwise become involved in any transaction with any party which has been introduced to it by Rossi, without the express written permission of the introducing party and without having entered into a commission agreement with the introducing party. Any violation of the covenant shall be deemed an attempt to circumvent Rossi, and the party so violating this covenant shall be liable for damages in favor of the circumvented party.

V.4 No Solicitations. From and after the date of this Agreement until the Effective Time or termination of this Agreement pursuant to ARTICLE X, FNHI will not nor will it authorize or permit any of its officers, directors, affiliates or employees or any investment banker, attorney or other advisor or representative retained by it, directly or indirectly, (i) solicit or initiate the making, submission or announcement of any other acquisition proposal, (ii) participate in any discussions or negotiations regarding, or furnish to any person any non-public information with respect to any other acquisition proposal, (iii) engage in discussions with any Person with respect to any other acquisition proposal, except as to the existence of these provisions, (iv) approve, endorse or recommend any other acquisition proposal or (v) enter into any letter of intent or similar document or any contract agreement or commitment contemplating or otherwise relating to any other acquisition proposal.

V.5 Notification of Adverse Change. The Company shall promptly notify Rossi of any material adverse change in the condition (financial or otherwise) of FNHI.

V.6 Notification of Certain Matters. The Company shall promptly notify Rossi of any fact, event, circumstance or action known to it that is reasonably likely to cause FNHI to be unable to perform any of its covenants contained herein or any condition precedent in ARTICLE VII not to be satisfied, or that, if known on the date of this Agreement, would have been required to be disclosed to Rossi pursuant to this Agreement or the existence or occurrence of which would cause any of FNHI’s representations or warranties under this Agreement not to be correct and/or complete. The Company shall give prompt written notice to Rossi of any adverse development causing a breach of any of the representations and warranties in ARTICLE III as of the date made.

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V.7 The Company Disclosure Schedule. For purposes of determining the satisfaction of any of the conditions to the obligations of Rossi in ARTICLE VII, FNHI disclosures shall be deemed to include only (a) the information contained therein on the date of this Agreement and (b) information provided by written supplements delivered prior to Closing by FNHI that (i) are accepted in writing by Rossi, or (ii) reflect actions taken or events occurring after the date hereof prior to Closing.

V.8 State Statutes. The Company and its Board of Directors shall, if any state takeover statute or similar law is or becomes applicable to the Share Exchange, this Agreement or any of the transactions contemplated by this Agreement, use all reasonable efforts to ensure that the Share Exchange and the other transactions contemplated by this Agreement may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise to minimize the effect of such statute or regulation on the Share Exchange, this Agreement and the transactions contemplated hereby.

V.9 Conduct of Business. Prior to the Closing Date, FNHI shall conduct its business in the normal course, and shall not sell, pledge, or assign any assets, without the prior written approval of Rossi, except in the regular course of business. Except as otherwise provided herein, FNHI shall not amend its Articles of Incorporation or Bylaws, declare dividends, redeem or sell stock or other securities, acquire or dispose of fixed assets, change employment terms, enter into any material or long-term contract, guarantee obligations of any third party, settle or discharge any material balance sheet receivable for less than its stated amount, pay more on any liability than its stated amount, or enter into any other transaction other than in the regular course of business.

V.10 Securities Filings. Until closing, FNHI will timely file all reports and other documents relating to the operation of FNHI required to be filed with the Securities and Exchange Commission, which reports and other documents do not and will not contain any misstatement of a material fact, and do not and will not omit any material fact necessary to make the statements therein not misleading.

V.11 Election to FNHI’s Board of Directors. At the Effective Time of the Share Exchange, FNHI shall take all steps necessary so that there will be at least one (1) continuing director.

ARTICLE VI
COVENANTS OF ROSSI

Between the date of this Agreement and the Closing Date,

VI.1 Additional Information. Rossi shall provide to FNHI and its Representatives such financial, operating and other documents, data and information relating to TruXmart, the TruXmart Business and the TruXmart Assets and the Liabilities of the TruXmart and its Subsidiaries, as FNHI or its Representatives may reasonably request. In addition, Rossi shall take all action necessary to enable FNHI and its Representatives to review and inspect the TruXmart Assets, the TruXmart Business and the Liabilities of TruXmart and discuss them with FNHI’s officers, employees, independent accountants and counsel. Notwithstanding any investigation that FNHI may conduct of TruXmart, the TruXmart Business, the TruXmart Assets and the Liabilities of the TruXmart, FNHI may fully rely on the Rossi’s warranties, covenants and indemnities set forth in this Agreement.

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VI.2 No Solicitations. From and after the date of this Agreement until the Effective Time or termination of this Agreement pursuant to ARTICLE X, Rossi will not nor will it authorize or permit any of TruXmart’s officers, directors, affiliates or employees or any investment banker, attorney or other advisor or representative retained by it, directly or indirectly, (i) solicit or initiate the making, submission or announcement of any other acquisition proposal, (ii) participate in any discussions or negotiations regarding, or furnish to any person any non-public information with respect to any other acquisition proposal, (iii) engage in discussions with any Person with respect to any other acquisition proposal, except as to the existence of these provisions, (iv) approve, endorse or recommend any other acquisition proposal or (v) enter into any letter of intent or similar document or any contract agreement or commitment contemplating or otherwise relating to any other acquisition proposal.

VI.3 Notification of Adverse Change. Rossi shall promptly notify FNHI of any material adverse change in the condition (financial or otherwise) of TruXmart.

VI.4 Consents and Approvals. As soon as practicable after execution of this Agreement, Rossi shall use his commercially reasonable efforts to obtain any necessary consent, approval, authorization or order of, make any registration or filing with or give notice to, any Regulatory Authority or Person as is required to be obtained, made or given by Rossi to consummate the transactions contemplated by this Agreement and the Collateral Documents.

VI.5 Notification of Certain Matters. Rossi shall promptly notify FNHI of any fact, event, circumstance or action known to it that is reasonably likely to cause TruXmart to be unable to perform any of its covenants contained herein or any condition precedent if not to be satisfied, or that, if known on the date of this Agreement, would have been required to be disclosed to FNHI pursuant to this Agreement or the existence or occurrence of which would cause Rossi’s representations or warranties under this Agreement not to be correct and/or complete. Rossi shall give prompt written notice to FNHI of any adverse development causing a breach of any of the representations and warranties in ARTICLE IV.

VI.6 The TruXmart Executive Summary. Rossi shall, from time to time prior to Closing, supplement the TruXmart Disclosure Statement with additional information that, if existing or known to it on the date of this Agreement, would have been required to be included therein. For purposes of determining the satisfaction of any of the conditions to the obligations of FNHI in the Rossi Disclosure Statement shall be deemed to include only (a) the information contained therein on the date of delivery to FNHI and (b) information added to the Rossi Disclosure Statement by written supplements delivered prior to Closing by the Rossi that (i) are accepted in writing by FNHI or (ii) reflect actions taken or events occurring after the date hereof and prior to Closing.

VI.7 Audited Financial Statements. Prior to Closing, Rossi shall provide FNHI with audited historical financial statements of TruXmart and any Subsidiaries, for its last two calendar years, of prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby (except as may be indicated in the notes thereto), and presenting fairly the financial condition of TruXmart and its results of operations as of the dates and for the periods indicated, subject only to normal year-end adjustments (none of which will be material in amount) and the omission of footnotes.

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ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PARTIES

All obligations of the Parties under this Agreement shall be subject to the fulfillment at or prior to Closing of each of the following conditions, it being understood that the Parties may, in their sole discretion, to the extent permitted by applicable Legal Requirements, waive any or all of such conditions in whole or in part.

VII.1 Accuracy of Representations. All representations and warranties of FNHI contained in this Agreement, the Collateral Documents and any certificate delivered by any of FNHI at or prior to Closing shall be, if specifically qualified by materiality, true in all respects and, if not so qualified, shall be true in all material respects, in each case on and as of the Closing Date with the same effect as if made on and as of the Closing Date, except for representations and warranties expressly stated to be made as of the date of this Agreement or as of another date other than the Closing Date and except for changes contemplated or permitted by this Agreement. The Company shall have delivered to Rossi a certificate dated the Closing Date to the foregoing effect.

VII.2 Covenants. FNHI shall, in all material respects, have performed and complied with each of the covenants, obligations and agreements contained in this Agreement and the Collateral Documents that are to be performed or complied with by them at or prior to Closing. FNHI shall have delivered to Rossi a certificate dated the Closing Date to the foregoing effect.

VII.3 Consents and Approvals. All consents, approvals, permits, authorizations and orders required to be obtained from, and all registrations, filings and notices required to be made with or given to, any Regulatory Authority or Person as provided herein.

VII.4 Delivery of Documents. FNHI shall have delivered, or caused to be delivered, to Rossi the following documents:

(i) Copies of FNHI articles of incorporation and bylaws and certified resolutions of the board of directors of FNHI authorizing the execution of this Agreement and the Collateral Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby.

(ii) Such other documents and instruments as Rossi may reasonably request: (A) to evidence the accuracy of FNHI’s representations and warranties under this Agreement, the Collateral Documents and any documents, instruments or certificates required to be delivered hereunder; (B) to evidence the performance by FNHI of, or the compliance by FNHI with, any covenant, obligation, condition and agreement to be performed or complied with by FNHI under this Agreement and the Collateral Documents; or (C) to otherwise facilitate the consummation or performance of any of the transactions contemplated by this Agreement and the Collateral Documents.

(iii) Letters of resignation from FNHI’s current officers and directors to be effective upon the Closing.

(iv) Board resolutions from FNHI’s current directors appointing Steven Rossi as the sole member of FNHI’s board of directors.

VII.5 No Material Adverse Change. Since the date hereof, there shall have been no material adverse change in FNHI Assets, FNHI Business or the financial condition or operations of FNHI, taken as a whole.

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ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF ROSSI AND FNHI

All obligations of Rossi under this Agreement shall be subject to the fulfillment at or prior to Closing of the following conditions, it being understood that FNHI may, in its sole discretion, to the extent permitted by applicable Legal Requirements, waive any or all of such conditions in whole or in part.

VIII.1 Accuracy of Representations. All representations and warranties of Rossi contained in this Agreement and the Collateral Documents and any other document, instrument or certificate delivered by Rossi at or prior to the Closing shall be, if specifically qualified by materiality, true and correct in all respects and, if not so qualified, shall be true and correct in all material respects, in each case on and as of the Closing Date with the same effect as if made on and as of the Closing Date, except for representations and warranties expressly stated to be made as of the date of this Agreement or as of another date other than the Closing Date and except for changes contemplated or permitted by this Agreement. Rossi shall have delivered to FNHI a certificate dated the Closing Date to the foregoing effect.

VIII.2 Covenants. Rossi shall, in all material respects, have performed and complied with each obligation, agreement, covenant and condition contained in this Agreement and the Collateral Documents and required by this Agreement and the Collateral Documents to be performed or com-plied with by Rossi at or prior to Closing. Rossi shall have delivered to FNHI a certificate dated the Closing Date to the foregoing effect.

VIII.3 Consents and Approvals. All consents, approvals, authorizations and orders required to be obtained from, and all registrations, filings and notices required to be made with or given to, any Regulatory Authority or Person as provided herein.

VIII.4 Delivery of Documents. Rossi shall have executed and delivered, or caused to be executed and delivered, to FNHI the following documents:

Documents and instruments as FNHI may reasonably request: (A) to evidence the accuracy of the representations and warranties of Rossi under this Agreement and the Collateral Documents and any documents, instruments or certificates required to be delivered hereunder; (B) to evidence the performance by Rossi of, or the compliance by Rossi with, any covenant, obligation, condition and agreement to be performed or complied with by Rossi under this Agreement and the Collateral Documents; or (C) to otherwise facilitate the consummation or performance of any of the transactions contemplated by this Agreement and the Collateral Documents.

VIII.5 No Material Adverse Change. There shall have been no material adverse change in the business, financial condition or operations of TruXmart and its Subsidiaries taken as a whole.

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VIII.6 No Litigation. No action, suit or proceeding shall be pending or threatened by or before any Regulatory Authority and no Legal Requirement shall have been enacted, promulgated or issued or deemed applicable to any of the transactions contemplated by this Agreement and the Collateral Documents that would: (i) prevent consummation of any of the transactions contemplated by this Agreement and the Collateral Documents; (ii) cause any of the transactions contemplated by this Agreement and the Collateral Documents to be rescinded following consummation; or (iii) have a Material Adverse Effect on TruXmart.

ARTICLE IX
INDEMNIFICATION

IX.1 Indemnification by FNHI. FNHI shall indemnify, defend and hold harmless (i) Rossi, (ii) any Rossi’s assigns and successors in interest to FNHI Shares, and (iii) each of their respective shareholders, members, partners, directors, officers, managers, employees, agents, attorneys and representatives, from and against any and all Losses which may be incurred or suffered by any such party and which may arise out of or result from any breach of any material representation, warranty, covenant or agreement of FNHI contained in this Agreement. All claims to be assorted hereunder must be made for the first anniversary of the Closing.

IX.2 Indemnification by Rossi. Rossi shall indemnify, defend and hold harmless FNHI from and against any and all Losses which may be incurred or suffered by any such party hereto and which may arise out of or result from any breach of any material representation, warranty, covenant or agreement of Rossi contained in this Agreement. All claims to be assorted hereunder must be made for the first anniversary of the Closing.

IX.3 Notice to Indemnifying Party. If any party (the “Indemnified Party”) receives notice of any claim or other commencement of any action or proceeding with respect to which any other party (or parties) (the “Indemnifying Party”) is obligated to provide indemnification pursuant to Sections 9.1 or 9.2, the Indemnified Party shall promptly give the Indemnifying Party written notice thereof, which notice shall specify in reasonable detail, if known, the amount or an estimate of the amount of the liability arising here from and the basis of the claim. Such notice shall be a condition precedent to any liability of the Indemnifying Party for indemnification hereunder, but the failure of the Indemnified Party to give prompt notice of a claim shall not adversely affect the Indemnified Party’s right to indemnification hereunder unless the defense of that claim is materially prejudiced by such failure. The Indemnified Party shall not settle or compromise any claim by a third party for which it is entitled to indemnification hereunder without the prior written consent of the Indemnifying Party (which shall not be unreasonably withheld or delayed) unless suit shall have been instituted against it and the Indemnifying Party shall not have taken control of such suit after notification thereof as provided in Section 9.4.

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IX.4 Defense by Indemnifying Party. In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any claim or legal proceeding by a Person who is not a party to this Agreement, the Indemnifying Party at its sole cost and expense may, upon written notice to the Indemnified Party, assume the defense of any such claim or legal proceeding (i) if it acknowledges to the Indemnified Party in writing its obligations to indemnify the Indemnified Party with respect to all elements of such claim (subject to any limitations on such liability contained in this Agreement) and (ii) if it provides assurances, reasonably satisfactory to the Indemnified Party, that it will be financially able to satisfy such claims in full if the same are decided adversely. If the Indemnifying Party assumes the defense of any such claim or legal proceeding, it may use counsel of its choice to prosecute such defense, subject to the approval of such counsel by the Indemnified Party, which approval shall not be unreasonably withheld or delayed. The Indemnified Party shall be entitled to participate in (but not control) the defense of any such action, with its counsel and at its own expense; provided, however, that if the Indemnified Party, in its sole discretion, determines that there exists a conflict of interest between the Indemnifying Party (or any constituent party thereof) and the Indemnified Party, the Indemnified Party (or any constituent party thereof) shall have the right to engage separate counsel, the reasonable costs and expenses of which shall be paid by the Indemnified Party. If the Indemnifying Party assumes the defense of any such claim or legal proceeding, the Indemnifying Party shall take all steps necessary to pursue the resolution thereof in a prompt and diligent manner. The Indemnifying Party shall be entitled to consent to a settlement of, or the stipulation of any judgment arising from, any such claim or legal proceeding, with the consent of the Indemnified Party, which consent shall not be unreasonably withheld or delayed; provided, however, that no such consent shall be required from the Indemnified Party if (i) the Indemnifying Party pays or causes to be paid all Losses arising out of such settlement or judgment concurrently with the effectiveness thereof (as well as all other Losses theretofore incurred by the Indemnified Party which then remain unpaid or unreimbursed), (ii) in the case of a settlement, the settlement is conditioned upon a complete release by the claimant of the Indemnified Party and (iii) such settlement or judgment does not require the encumbrance of any asset of the Indemnified Party or impose any restriction upon its conduct of business.

ARTICLE X
TERMINATION

X.1 Termination. This Agreement may be terminated, and the transactions contemplated hereby may be abandoned, at any time prior to it being fully executed, or thereafter:

(a) by mutual written agreement of Rossi and FNHI hereto duly authorized by action taken by or on behalf of the respective Boards of Directors; or

(b) by either FNHI or Rossi upon notification to the non-terminating party by the terminating party:

(i) if the terminating party is not in material breach of its obligations under this Agreement and there has been a material breach of any representation, warranty, covenant or agreement on the part of the non-terminating party set forth in this Agreement such that the conditions will not be satisfied; provided, however, that if such breach is curable by the non-terminating party and such cure is reasonably likely to be completed prior to the date specified in Section 10.1(b)(i), then, for so long as the non-terminating party continues to use commercially reasonable efforts to effect and cure, the terminating party may not terminate pursuant to this Section 10.1(b)(i); or

(ii) if any court of competent jurisdiction or other competent Governmental or Regulatory Authority shall have issued an order making illegal or otherwise permanently restricting, preventing or otherwise prohibiting the Share Exchange and such order shall have become final.

(c) Effect of Termination. If this Agreement is validly terminated by either FNHI or Rossi pursuant to Section 10.1, this Agreement will forthwith become null and void and there will be no liability or obligation on the part of the parties hereto, except that nothing contained herein shall relieve any party hereto from liability for willful breach of its representations, warranties, covenants or agreements contained in this Agreement.

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ARTICLE XI
MISCELLANEOUS

XI.1 Parties Obligated and Benefited. This Agreement shall be binding upon the Parties and their respective successors by operation of law and shall inure solely to the benefit of the Parties and their respective successors by operation of law, and no other Person shall be entitled to any of the benefits conferred by this Agreement. Without the prior written consent of the other Party, no Party may assign this Agreement or the Collateral Documents or any of its rights or interests or delegate any of its duties under this Agreement or the Collateral Documents.

XI.2 Publicity. The initial press release and/or Form 8-K shall be a joint press release and thereafter FNHI and Rossi each shall consult with each other prior to issuing any press releases or otherwise making public announcements with respect to the Share Exchange and the other transactions contemplated by this Agreement and prior to making any filings with any third party and/or any Regulatory Authorities (including any national securities inter dealer quotation service) with respect thereto, except as may be required by law or by obligations pursuant to any listing agreement with or rules of any national securities inter dealer quotation service.

XI.3 Notices. Any notices and other communications required or permitted hereunder shall be in writing and shall be effective upon delivery by hand or upon receipt if sent by certified or registered mail (postage prepaid and return receipt requested) or by a nationally recognized overnight courier service (appropriately marked for overnight delivery) or upon transmission if sent by telex or facsimile (with request for immediate confirmation of receipt in a manner customary for communications of such respective type and with physical delivery of the communication being made by one or the other means specified in this Section as promptly as practicable thereafter). Notices shall be addressed as follows:

If to Rossi:	Steven Rossi
	17 Antwerp Street, St Catharines,
	Ontario, Canada L2S-1J7
If to FNHI:	Matthew McMurdo, Esq.
	Attorney-At-Law
	28 West 44th Street
	16th Floor
	New York, New York 10036
	(w) 917-318-2865
	(f) 866-606-8914

XI.4 Any Party may change the address to which notices are required to be sent by giving notice of such change in the manner provided in this Section.

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XI.5 Attorneys’ Fees. In the event of any action or suit based upon or arising out of any alleged breach by any Party of any representation, warranty, covenant or agreement contained in this Agreement or the Collateral Documents, the prevailing Party shall be entitled to recover reasonable attorneys’ fees and other costs of such action or suit from the other Party.

XI.6 Headings. The Article and Section headings of this Agreement are for convenience only and shall not constitute a part of this Agreement or in any way affect the meaning or interpretation thereof.

XI.7 Choice of Law. This Agreement and the rights of the Parties under it shall be governed by and construed in all respects in accordance with the laws of the State of Nevada, without giving effect to any choice of law provision or rule (whether of Ontario, Canada or any other jurisdiction).

XI.8 Rights Cumulative. All rights and remedies of each of the Parties under this Agreement shall be cumulative, and the exercise of one or more rights or remedies shall not preclude the exercise of any other right or remedy available under this Agreement or applicable law.

XI.9 Further Actions. The Parties shall execute and deliver to each other, from time to time at or after Closing, for no additional consideration and at no additional cost to the requesting party, such further assignments, certificates, instruments, records, or other documents, assurances or things as may be reasonably necessary to give full effect to this Agreement and to allow each party fully to enjoy and exercise the rights accorded and acquired by it under this Agreement.

XI.10 Time of the Essence. Time is of the essence under this Agreement. If the last day permitted for the giving of any notice or the performance of any act required or permitted under this Agreement falls on a day which is not a Business Day, the time for the giving of such notice or the performance of such act shall be extended to the next succeeding Business Day.

XI.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

XI.12 Entire Agreement. This Agreement (including the Exhibits, disclosures made as to FNHI, the TruXmart Executive Summary and any other documents, instruments and certificates referred to herein, which are incorporated in and constitute a part of this Agreement) contains the entire agreement of the Parties.

XI.13 Survival of Representations and Covenants. Notwithstanding any right of Rossi to fully investigate the affairs of FNHI and notwithstanding any knowledge of facts determined or determinable by Rossi pursuant to such investigation or right of investigation, Rossi shall have the right to rely fully upon the representations, warranties, covenants and agreements of FNHI contained in this Agreement. Each representation, warranty, covenant and agreement of FNHI contained herein shall survive the execution and delivery of this Agreement and the Closing and shall thereafter terminate and expire on the first anniversary of the Closing Date unless, prior to such date, Rossi has delivered to FNHI Shareholders a written notice of a claim with respect to such representation, warranty, covenant or agreement.

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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the day and year first above written.

Dated: December 16, 2014

Franchise Holdings International, Inc.
By:	/s/ Steven Rossi
Name:	Steven Rossi
Title:	Chief Executive Officer
TruXmart Ltd.
By:	/s/ Steven Rossi
Name:	Steven Rossi
Title:	Chief Executive Officer
	/s/ Steven Rossi
	Steven Rossi

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EX-10.2

EXHIBIT 10.2

EXCLUSIVE LICENSE AGREEMENT

BETWEEN

Steven Rossi

AND

TruXmart Ltd.

FOR

Smart Fold Latching System

1

EXCLUSIVE LICENSE AGREEMENT FOR Smart Fold Latching System

This exclusive license agreement (“Agreement”) is effective August 26, 2014 (“Effective Date”), by and between (a) Steven Rossi of 11 Westlea Ave, Richmond Hill, ON., L4E 0H7 and (b) TruXmart Ltd. (“Licensee”), a Ontario corporation having a principal place of business at 1895 Clements Road, Unit 155, Pickering, Ontario L1W-3V5. Steven Rossi and Licensee will be referred to herein, on occasion, individually as “Party” or collectively as “Parties”.

RECITALS

Whereas, Steven Rossi has an assignment of title to the invention entitled " Smart Fold Latching System" (the “Invention”), as described in Steven Rossi Patent No. 8,814249 B2, invented by Steven Rossi.

Whereas, Steven Rossi and Licensee desire to have the Invention developed and commercialized so that products resulting there from may be available for public use and benefit; and

Whereas, Licensee desires to acquire, and Steven Rossi desires to grant, a license under Patent Rights to make, use, sell, offer for sale, and import products, methods, and services in accordance with the terms herein.

Now, therefore, the Parties agree as follows:

1. DEFINITIONS

1.1 “Affiliate” of Licensee (or of a Sublicensee, respectively) means any entity that, as of the applicable point in time during the term of this Agreement, directly or indirectly Controls Licensee (or a Sub licensee, respectively), is Controlled by Licensee (or a Sublicensee, respectively), or is under common Control with Licensee (or a Sublicensee, respectively). “Control” means (a) having the actual, present capacity to elect a majority of the directors of such entity, (b) having the power to direct at least fifty percent (50%) of the voting rights entitled to elect directors of such entity, or (c) in any country where the local law will not permit foreign equity participation of a majority of the outstanding stock or voting rights of such entity, the ownership or control, directly or indirectly, of the maximum percentage of such outstanding stock or voting rights permitted by local law.

1.2 “Licensed Field of Use” means the manufacture or sublicensee of the patent.

1.3 “Licensed Method” means any process or method the use or practice of which, (a) but for the license granted pursuant to this Agreement, would infringe, or contribute to or induce the infringement of, a Valid Claim of any issued, unexpired patent under Patent Rights, or (b) is covered by a claim in a pending patent application under Patent Rights. As used in Subparagraph (b) of this Paragraph 1.3, “covered by a claim in a pending patent application” means that such use or practice would, but for the license granted pursuant to this Agreement, constitute infringement, contributory infringement, or inducement of infringement, of such claim if such claim were issued.

1.4 “Licensed Product” means any product, material, kit, or other article of manufacture or composition of matter, the making, use, Sale, offer for Sale, or import of which (a) but for the license granted pursuant to this Agreement, would infringe, or contribute to or induce the infringement of, a Valid Claim of any issued, unexpired patent under Patent Rights, or (b) is covered by a claim in a pending patent application under Patent Rights. As used in Subparagraph (b) of this Paragraph 1.4, “covered by a claim in a pending patent application” means that such making, use, Sale, offer for Sale, or import would, but for the license granted pursuant to this Agreement, constitute infringement, contributory infringement, or inducement of infringement, of such claim if such claim were issued.

1.5 “Licensed Service” means a service provided using Licensed Products or Licensed Methods, including, without limitation, any such service provided in the form of contract research or other research performed by Licensee on behalf of a third party.

1.6 “Licensed Territory” means the United States and its territories and possessions, and any foreign countries where Patent Rights exist.

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2. GRANT

2.1 Subject to the limitations set forth in this Agreement, including, without limitation, the rights reserved in Paragraph 2.2, Steven Rossi hereby grants to Licensee an exclusive license under Patent Rights, in the Licensed Field of Use in the Licensed Territory, (a) to make, use, offer for Sale, import, and Sell Licensed Products and Licensed Services, and (b) to practice Licensed Methods.

2.2 Steven Rossi reserves the right to do any one or more of the following:

(a) publish any technical data resulting from research performed by Steven Rossi relating to the Invention;

(b) make, use, and import the Invention and associated technology for development of new products;

3. SUBLICENSES

3.1 Steven Rossi hereby further grants to Licensee the right to grant to Affiliates of Licensee, to Affiliates of Sublicensees, and to third parties a Sublicense under the rights granted to Licensee hereunder, provided that Licensee has exclusive rights under this Agreement at the time of the grant of the Sublicense. Every Sublicense will include:

3.3 Within thirty (30) days of execution of each Sublicense Agreement, or amendment thereof, Licensee will inform Steven Rossi of such executed Sublicense Agreement or amendment, and Licensee will furnish to Steven Rossi a copy of such Sublicense Agreement or amendment.

3.4 Affiliates of Licensee and Affiliates of Sublicensees will have no licenses under Patent Rights except as granted by Licensee in a Sublicense pursuant to this Agreement.

3.5 For the purposes of this Agreement, the operations of Sublicensees under their respective Sublicense Agreements will be deemed to be the operations of Licensee, for which Licensee will be responsible.

3.7 Upon termination of this Agreement for any reason, at Steven Rossi' discretion, all Sublicenses that are granted by Licensee pursuant to this Agreement, will remain in effect and will be assigned to Steven Rossi, except that Steven Rossi will not be bound to perform any obligations set forth in any Sublicenses that extend beyond the obligations of Steven Rossi set forth in this Agreement.

4. LICENSE ISSUE FEE/MAINTENANCE FEES

4.1 Licensee will not be required to pay Steven Rossi license issue fees however are required to maintain any fees or costs associated to keep the patent active.

5. ROYALTIES

5.1 Licensee will not be required to pay to Steven Rossi any royalties.

6. DILIGENCE

6.1 Licensee will diligently proceed with the development, manufacture, marketing, and Sale of Licensed Products and Licensed Services in quantities sufficient to meet the market demand.

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9. LIFE OF THE AGREEMENT

9.1 Unless otherwise terminated by operation of law or by acts of the Parties in accordance with the terms of this Agreement, this Agreement will be in effect from the Effective Date and will remain in effect for the life of the last-to-expire patent or last-to-be-abandoned patent application licensed under this Agreement, whichever is later.

9.2 Any termination of this Agreement will not affect the rights and obligations set forth in the following:

Article 1 Definitions

Article 3 Sublicenses

Paragraph 4.1 License Issue Fee

Article 8 Books and Records

Article 9 Life of the Agreement

Article 12 Disposition of Licensed Products Upon Termination

Article 15 Use of Names and Trademarks

Article 16 Limited Warranties

Article 18 Indemnification

Article 22 Notices

Article 23 Payments

Article 25 Confidentiality

Article 28 Applicable Law; Venue; Attorneys’ Fees

Article 29 Scope of Agreement

10. TERMINATION BY STEVEN ROSSI

10.1 If Licensee should violate or fail to perform any term of this Agreement, then Steven Rossi may give written notice of such default (“Notice of Default”) to Licensee. If Licensee should fail to repair such default within sixty (60) days of the effective date of such notice, Steven Rossi will have the right to terminate this Agreement and the licenses herein by a second written notice (“Notice of Termination”) to Licensee. If a Notice of Termination is sent to Licensee, this Agreement will automatically terminate on the effective date of such notice. These notices will be subject to Article 22 (Notices).

10.2 Notwithstanding Paragraph 10.1, this Agreement will terminate immediately, if Licensee files a claim including in any way the assertion that any portion of Patent Rights is invalid or unenforceable, where the filing of such claim is by Licensee, by a third party on behalf of Licensee, or by a third party at the urging of Licensee.

10.3 Notwithstanding Paragraph 10.1, this Agreement will terminate immediately in the event of the filing of a petition for relief under the United States Bankruptcy Code by or against Licensee as a debtor or alleged debtor. 11. TERMINATION BY LICENSEE

11.1 Licensee will have the right at any time to terminate this Agreement in whole or as to any portion of Patent Rights by giving notice in writing to Steven Rossi. Such notice of termination will be subject to Article 22 (Notices) and such termination of this Agreement in whole or in part will be effective ninety (90) days after the effective date of such notice of termination.

11.2 Any termination pursuant to Paragraph 11.1 will not relieve Licensee of any obligation or liability accrued hereunder prior to such termination.

12. DISPOSITION OF LICENSED PRODUCTS UPON TERMINATION

12.1 Upon termination of this Agreement, for a period of one hundred and twenty (120) days after the date of termination, Licensee may complete the making of, and may Sell, any partially made Licensed Products, and Licensee may continue the practice of Licensed Methods only to the extent necessary to do the foregoing; provided that all such Sales will be subject to the terms of this.

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13. PATENT PROSECUTION AND MAINTENANCE

13.1 The Licensee will prosecute and maintain the patent applications and patents under Patent Rights, subject. All patent applications and patents under Patent Rights will be held in the name of the Licensee. The Licensee will have sole responsibility for retaining and instructing patent counsel. The Licensee will promptly provide Licensee with copies of all official patent office correspondence, and Licensee agrees to keep this documentation confidential in accordance with Article 25 (Confidentiality).

13.2 The Licensee will use reasonable efforts to prepare or amend any patent application within Patent Rights to include claims to reasonably protect the Licensed Products or Licensed Services contemplated to be Sold or Licensed Methods to be practiced under this Agreement.

13.3 Subject to Paragraph 13.4, all past, present, and future costs for preparing, filing, prosecuting, and maintaining all patent applications and patents under Patent Rights (including, without limitation, the cost of interferences, reexaminations, oppositions, post-grant review, inter parties review, supplemental examinations, and other patent office administrative proceedings, and their appeals), will be paid by Licensee, so long as the licenses granted to Licensee herein are exclusive. If, however, Steven Rossi reduces the exclusive licenses granted herein to non-exclusive licenses pursuant to Paragraph 6.3 or Paragraph 6.4, and Steven Rossi grants one or more additional licenses, the subsequent costs of preparing, filing, prosecuting, and maintaining such patent applications and patents will be divided equally among the licensed parties from the effective date of each subsequently granted license agreement.

13.4 Licensee's obligation to pay all patent preparation, filing, prosecution, and maintenance costs for Patent Rights will continue for so long as this Agreement remains in effect, provided that Licensee may terminate Licensee’s obligations with respect to any given patent application or patent under Patent Rights in any designated country upon three (3) months’ written notice to Steven Rossi. In the event of such notice to Steven Rossi, Steven Rossi will undertake to curtail applicable patent costs billable to Licensee. Steven Rossi may continue prosecution and maintenance of such patent applications or patents at Steven Rossi’ sole discretion and expense, provided that Licensee will have no further right or licenses there under.

14. MARKING

14.1 Licensee will mark all Licensed Products made, used, offered for Sale, imported, or Sold under this Agreement, or their containers, in accordance with applicable patent marking laws.

15. USE OF NAMES AND TRADEMARKS

15.1 Nothing contained in this Agreement will be construed as conferring upon either Party any right to use in advertising, publicity, or other promotional activities any name, trademark, trade name, or other designation of the other Party (including any contraction, abbreviation, or simulation of any of the foregoing). Unless required by law or consented to in writing by Steven Rossi, Licensee will not use the name “Steven Rossi” in advertising, publicity, or other promotional activities.

16. LIMITED WARRANTIES

16.1 Steven Rossi warrants to Licensee that Steven Rossi has the lawful right to grant this license.

16.2 This license and the associated rights to the Invention are provided to Licensee WITHOUT WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER WARRANTY, EXPRESS OR IMPLIED. STEVEN ROSSI MAKES NO REPRESENTATION OR WARRANTY THAT PRACTICE OF THE INVENTION OR PATENT RIGHTS (INCLUDING MAKING, USING, SELLING, OFFERING TO SELL, OR IMPORTING LICENSED PRODUCTS, LICENSED SERVICES, OR LICENSED METHODS) WILL NOT INFRINGE ANY PATENT OR OTHER PROPRIETARY RIGHT.

16.3 IN NO EVENT WILL STEVEN ROSSIBE LIABLE FOR ANY INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE OR A SUBLICENSE, OR THE USE OF THE INVENTION, PATENT RIGHTS, LICENSED METHODS, LICENSED SERVICES, OR LICENSED PRODUCTS.

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16.4 Nothing in this Agreement is or will be construed as:

(a) a warranty or representation by Steven Rossi as to the patentability, validity, enforceability, or scope of Patent Rights;

(b) a warranty or representation that anything made, used, Sold, offered for Sale, or imported under any license granted in this Agreement is or will be free from infringement of patents of third parties;

(c) an obligation to furnish any know-how not provided in the patents and patent applications under Patent Rights.

17. PATENT INFRINGEMENT

17.1 In the event that Licensee learns of the substantial infringement of any Patent Rights, Licensee will promptly provide Steven Rossiwith notice and reasonable evidence of such infringement (“Infringement Notice”). During the time period and in a jurisdiction where Licensee has exclusive rights under this Agreement, neither Party will notify a third party, including the infringer, of the infringement without first obtaining consent of the other Party, which consent will not be unreasonably withheld. The Parties will use diligent efforts, in cooperation with each other, to terminate such infringement without litigation.

17.2 (a) If such infringing activity has not been abated within ninety (90) days following the effective date of the Infringement Notice, Licensee may initiate suit for patent infringement against the infringer. Steven Rossi may voluntarily join as a party in such suit at Steven Rossi’ expense, but Steven Rossi may not thereafter separately initiate suit against the infringer for the acts of infringement that are the subject of Licensee’s suit or any judgment rendered in that suit.

Licensee may not cause Steven Rossi to be joined as a party in a suit initiated by Licensee without Steven Rossi’ prior written consent. If, in a suit initiated by Licensee, Steven Rossi is involuntarily caused to be joined as a party, Licensee will pay any costs incurred by Steven Rossi arising out of such suit, including, but not limited to, any legal fees of counsel that Steven Rossi selects and retains to represent it in the suit.

(b) If, within a hundred and twenty (120) days following the effective date of the Infringement Notice, the infringing activity has not been abated and if Licensee has not initiated suit against the infringer, Steven Rossi may in its sole discretion initiate suit for patent infringement against the infringer. If Steven Rossi initiates such suit, Licensee may not join such suit without Steven Rossi’consent, and Licensee may not thereafter separately initiate suit against the infringer for the acts of infringement that are the subject of Steven Rossi’ suit or any judgment rendered in that suit.

17.3 Such suit initiated under Paragraph 17.2 will be at the expense of the initiating Party and all recoveries recovered thereby will belong to such Party, provided that suits initiated jointly by Steven Rossi and Licensee will be at the joint expense of the Parties and all recoveries will be allocated in the following order: (a) to each Party reimbursement for its attorneys' costs, fees, and other related out-of-pocket expenses, to the extent such Party paid for such costs, fees, and expenses until all such costs, fees, and expenses are consumed for such Party; and (b) any remaining amount shared jointly by the Parties in proportion to the share of expenses paid by each Party.

17.4 Each Party will cooperate with the other Party in litigation initiated hereunder but at the expense of the initiating Party. Such litigation will be controlled by the initiating Party bringing the action, except that Steven Rossi may be represented by counsel of its choice in any suit initiated by Licensee.

17.5 Any agreement made by Licensee for the purposes of settling litigation initiated hereunder or other related dispute will comply with the requirements of Article 3 (Sublicenses). In no event may Licensee admit liability or wrongdoing on behalf of Steven Rossi without Steven Rossi’ prior written consent.

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18. INDEMNIFICATION 18.1 Licensee will, and will require Sublicensees to, indemnify, hold harmless, and defend Steven Rossi and sponsors of the research that led to the Invention; and the inventors of any patents and patent applications under Patent Rights and their employers; against any and all claims, suits, losses, damages, costs, fees, and expenses resulting from or arising out of exercise of this license or any Sublicense. This indemnification will include, but not be limited to, any product liability.

18.2 Steven Rossi will promptly notify Licensee in writing of any claim or suit brought against Steven Rossi for which Steven Rossi intends to invoke the provisions of this Article 18 (Indemnification). In no event may Licensee admit liability or wrongdoing on behalf of Steven Rossi or any other indemnitee without Steven Rossi' prior written consent. Licensee will keep Steven Rossi informed of Licensee’s defense of any claims pursuant to this Article 18 (Indemnification).

19. COMPLIANCE WITH LAWS/EXPORT CONTROLS

19.1 Licensee will comply with all applicable international, national, state, regional, and local laws and regulations in performing its obligations hereunder and in Licensee’s use, manufacture, Sale, offer for Sale, or import of the Licensed Products or Licensed Services, or in Licensee’s practice of Licensed Methods. Without limitation, Licensee will observe all applicable United States and foreign laws and regulations governing the transfer to other countries of technical data related to Licensed Products, Licensed Services, or Licensed Methods, including, without limitation, with respect to the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations.

20. GOVERNMENT APPROVAL OR REGISTRATION

20.1 If this Agreement or any associated transaction is required by the law of any nation to be either approved or registered with any governmental agency, Licensee will assume all legal obligations to do so. Licensee will notify Steven Rossi if Licensee becomes aware that this Agreement is subject to a United States or foreign government reporting or approval requirement. Licensee will make all necessary filings and pay all costs, including fees, penalties, and all other out-of-pocket costs, associated with such reporting or approval process.

21. ASSIGNMENT

21.1 This Agreement is binding upon and will inure to the benefit of Steven Rossi and to Steven Rossi’ successors and assigns. This Agreement is personal to Licensee and assignable by Licensee only with the written consent of Steven Rossi, provided that Licensee may, on written notice to Steven Rossi, assign this Agreement, including, without limitation, all obligations owed to Steven Rossi hereunder, to an acquirer of all or substantially all of Licensee's stock or assets.

22. NOTICES

22.1 All notices under this Agreement will be deemed to have been fully given and effective when done in writing and (a) delivered in person, (b) mailed by registered or certified mail, or (c) deposited with a carrier service requiring signature by recipient, and addressed as follows:

To Steven Rossi

11 Westlea AveRichmond Hill, ON., L4E 0H7

To Licensee TruXmart LTD

1895 Clements Road, Unit 155

Pickering, Ontario L1W-3V5

Attn.: Patent Department

Either Party may change its address upon written notice to the other Party.

24. WAIVER

24.1 The failure of either Party to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement will not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition by the other Party. None of the terms and conditions of this Agreement can be waived except by the written consent of the Party waiving compliance.

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25. CONFIDENTIALITY

25.1 With respect to disclosures by one Party (“Disclosing Party”) to the other Party (“Receiving Party”) under this Agreement, the Receiving Party will, subject to Paragraphs 25.2 and 25.3, hold the Disclosing Party's proprietary business and technical information, patent prosecution material, and other proprietary information, including the negotiated terms of this Agreement (all such proprietary information referred to collectively herein as “Proprietary Information”), in confidence and against disclosure to third parties, with at least the same degree of care as the Disclosing Party exercises to protect the Disclosing Party’s own data and information of a similar nature. This obligation will expire five (5) years after the termination or expiration of this Agreement.

25.2 With respect to Proprietary Information disclosed by the Disclosing Party to the Receiving Party, nothing contained herein will in any way restrict or impair the right of the Receiving Party to use, disclose, or otherwise deal with any information or data which:

(a) at the time of disclosure to the Receiving Party by the Disclosing Party is available to the public by publication or otherwise, or thereafter becomes available to the public by publication or otherwise through no act of the Receiving Party;

(b) the Receiving Party can show by written record was in the Receiving Party’s possession prior to the time of disclosure to the Receiving Party hereunder and was not acquired by the Receiving Party from the Disclosing Party;

(c) is independently made available to the Receiving Party without restrictions as a matter of right by a third party, as demonstrated by written record;

(d) is independently developed by employees or agents of the Receiving Party who did not have access to the information disclosed by the Disclosing Party, as demonstrated by written record; or

(e) is subject to disclosure under the California Public Records Act or other requirements of law.

25.3 Steven Rossi will be free to release to the inventors, Steven Rossi’ senior administrators, and individual Regents the terms and conditions of this Agreement upon their request. If such release is made, Steven Rossiwill inform such individuals of the confidentiality obligations set forth above and will request that such individuals not disclose such terms and conditions to others. Should a third party inquire whether a license to Patent Rights is available, Steven Rossi may disclose the existence of this Agreement and the extent of the grant in Articles 2 (Grant) and 3 (Sublicenses) to such third party but, unless Licensee so consents, Steven Rossi will not otherwise disclose the name of Licensee (or other negotiated terms of this Agreement) unless (a) Licensee or a third party has already made such disclosure publicly, or (b) such disclosure is required under the California Public Records Act or other requirements of law.

25.4 Within fifteen (15) days following the effective date of termination or expiration of this Agreement, each Receiving Party agrees to destroy or return to the Disclosing Party Proprietary Information received from the Disclosing Party which is in the possession of the Receiving Party. However, each Receiving Party may retain one copy of Proprietary Information received from the Disclosing Party for archival purposes in non-working files for the sole purpose of verifying the ownership of the Proprietary Information, provided such Proprietary Information will be subject to the confidentiality provisions set forth in this Article 25 (Confidentiality). Subject to such right to retain for archival purposes, each Receiving Party agrees to provide to the Disclosing Party, within thirty (30) days following termination of this Agreement, a written notice that Proprietary Information received from the Disclosing Party has been returned or destroyed.

26. SEVERABILITY

26.1 The provisions of this Agreement are severable, and in the event that any provision of this Agreement is determined to be invalid or unenforceable under any controlling law, such invalidity or enforceability will not in any way affect the validity or enforceability of the remaining provisions hereof.

27. APPLICABLE LAW; VENUE; ATTORNEYS’ FEES

27.1 This Agreement will be construed, interpreted, and applied in accordance with the laws of the Province of Ontario, excluding any choice-of-law rules that would direct the application of the laws of another jurisdiction, except that the scope and validity of any patent or patent application under Patent Rights will be determined by the applicable law of the country of such patent or patent application. Any legal action brought by one Party against the other Party relating to this Agreement will be conducted in Toronto, Ontario. The prevailing Party in any such legal action under this Agreement will be entitled to recover its reasonable attorneys’ fees in addition to its costs and necessary disbursements.

28. SCOPE OF AGREEMENT

28.1 This Agreement incorporates the entire agreement between the Parties with respect to the subject matter hereof and supersedes all previous communications, representations, or understandings, whether oral or written, between the Parties relating to the subject matter hereof. The Confidentiality Agreement specified in the Recitals above, effective August 26, 2014, is hereby superseded.

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28.2 This Agreement may be modified only by written amendment duly executed by the Parties. In witness whereof, the Parties have executed this Agreement in duplicate originals by their respective authorized officers or representatives on the respective dates below.

LICENSEE		STEVEN ROSSI
By:	/s/ Steven Raivio	By:	/s/ Steven Rossi
Name:	Steven Raivio	Name:	Steven Rossi
Title:	Business Development Manager
	TruXmart Ltd. (Licensee)	Steven Rossi
	1895 Clements Road, Unit 155	11 Westlea Ave
	Pickering, Ontario L1W-3V5	Richmond Hill, ON L4E-0H7
Date:	November 26, 2014	Date:	November 26, 2014

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EX-10.3

EXHIBIT 10.3

Corporate Advisory Services Agreement – Belair Capital Partners Inc./TruXmart Ltd.

As of May 1, 2014, superseding the original May 1, 2014 agreement

Re.: Superseding Belair Capital Partners Inc. Corporate Advisory Services Agreement

Dear Mr. Rossi:

We understand that TruXmart Ltd. (the “Company”) wishes to retain Belair Capital Partners Inc. (“Belair”) as its advisor on an exclusive basis until such services rendered by Belair may not be required by the Company and as may be determined by the Company. Certain services may be provided by one or more affiliates of Belair, however, the services will be governed by this Agreement. The following supersedes the original form of agreement entered into on May 1, 2014, which form was employed without legal counsel, and upon further review, its terms do not reflect our actual understanding of that point in time, and fails to reflect the changes in our actual understanding, including the most fundamental roles, responsibilities and consideration underlying and comprising our actual agreements. Subject to the below specified limitations and conditions, Belair will provide the Company with such regular and customary corporate and market-related advisory services as is reasonably requested by the Company, such advice may include, providing recommendations and assisting in the following:

A. Scope of Advisory Services:

1. Assisting the Company with the review and financial analysis of a going public transaction, possibly by way of a Reverse Takeover Transaction, or otherwise (the “Going Public Transaction Vehicle”) and provide the Company with strategic advice for completing such a transaction, as deemed desirable by the Company; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

2. Assisting the Company in identifying and qualifying a Going Public Transaction vehicle including, establishing and negotiating a corporate share structure with the Going Public Transaction Vehicle and contemporaneously furnishing advice on the amount and timing of any financing into the resulting issuer entity; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

3. Assisting the Company in finding and engaging the necessary professionals in order for the Company to manage the “Going Public Transaction” from initiation to completion by way of securing any necessary additional management personnel, legal representation, including with regard to the appointment of a legal firm with United States and/or Canadian credentials (through one or more third parties), tax and accounting services (through one or more third parties), including with regard to United States and Canadian certification (through one or more third parties) and outside consulting services (through one or more third parties); provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

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4. Assisting the Company in finding and engaging the necessary professionals in its efforts to raise initial funding of up to $350,000 concurrent to the Go Public Transaction, and with regard to any follow-on financing, currently contemplated by the Company to be between $650,000 and $1,000,000; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion; provided further, however, that Belair’s involvement will be limited in scope and ministerial in nature, and shall not include the sale of any security and not shall involve any decision-making with respect to any fundraising efforts. Except for timing of receipt of its compensation, Belair shall not receive any compensation based on funds raised, whether as a percentage of the fund raising, or otherwise.

5. Assisting the Company with the preparation of all presentation materials; review of audited financial statements; review and provide advice on all contracts and agreements and all regulatory matters; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

6. Assisting the Company with both interfacing and complying with regulatory authorities, including the recommendation of third parties; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

7. Assisting in determining and assessing listing requirements and options; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

8. Consulting with and making referrals to internal and external professional advisors when and if appropriate, for tax, legal, regulatory and cross jurisdictional matters. These services will include recommendations for additions to the management team and/or the board or directors and advisory board; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

9. Serving as escrow agent; provided that all decisions regarding disbursement of funds shall be made by the Company and no disbursements shall be paid without the specific, prior instruction by the Company.

10. Making site visits, if deemed appropriate by the Company, and by Belair’s due diligence team, to assure compliance and to assure the maintenance of appropriate business standards.

11. Providing on-going corporate, managerial and fiscal advice in relation to the existing Company and/or new public entity; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

12. Advising in the facilitation of the post public capitalization structure; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

13. Assisting in development of management and board contracts, and furnishing advice concerning management and employee compensation, including options, bonuses and incentive programs; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

14. Securing independent opinions and advice, as reasonably necessary, that the Company meets appropriate business, administrative and regulatory requirements and specifications under appropriate circumstances.

16. Belair will continue to provide advice on capital structure alternatives as deemed by the company to be reasonably necessary, including through its affiliates, if necessary.

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17. Assisting the Company in analyzing and evaluating the business, operations and financial position of the Company, including assessments of M&A and joint venture opportunities; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

18. Recommendations with regard to corporate governance and related initiatives provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion and compliance with respect thereto.

19. Recommendations with regard to marketing, public relations structure, investor relations and related initiatives, including third-party prospects with respect thereto; provided that all such decisions with respect thereto shall be made solely by the Company in its sole discretion.

21. Assisting the Company with introductions for representation before regulatory bodies and for the pursuit of compliance and listing requirements.

B. Term of Engagement:

1. The engagement of Belair on the terms and conditions contained herein shalt be in effect commencing with the signing of this agreement and expire on May 1, 2016, unless extended by mutual agreement of the parties.

2. This contract can be terminated for any reason by either party with a ninety (90) day notice. In order to do so, a written notification must be submitted by the party requesting the cancellation. Such a notification must be sent to the other party in writing with confirmation of delivery.

3. In the event that the cancellation is “for cause” then this period can be reduced to a thirty (30) day period. If the cancellation is for cause then the party must first provide a written notice detailing the basis for the cancellation. In such event, the party receiving such notice shall have two weeks from the receipt of such notice to respond and to resolve such attending circumstances, including, if applicable, demonstrating the mechanism for any resolution of the addressed issues. In the absence of adequate resolution, then this Agreement shall terminate upon the expiration of such thirty (30) day period.

C. Consideration for Services:

To further the corporate development initiatives of the Company, Belair will provide its entire skill, as reasonably requested by the Company set as described above, to development of the Company and to maximize the Company’s valuation, and prospects for success.

As consideration for the services to be provided by Belair to the Company pursuant to this Agreement, the Company agrees to pay Belair an advisory fee the “Advisory Fee”) of $5,000 per month for the term of the Agreement. By way of training only, the Advisory Fee will be deferred and not payable until the Go Public Transaction is completed and the Company raises not less than $400,000 in its sales of stock and/or other securities. Nothing within this agreement shall be construed as making the Advisory Fee contingent upon any fundraising – the foregoing is only with respect to the timing of payment not the earning or accrual thereof. Belair will provide to the Company a monthly statement showing the services it has provided.

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In the event Belair incurs out-of-pocket costs in connection with its services as enumerated herein, Belair shall be reimbursed by the Company for such amounts; provided, however, that any such out-of-pocket cost in excess of $100 must be approved in advance by the Company. Additionally, in the event that Belair spends more than 120 hours in any month in satisfaction of its obligation for services pursuant to this Agreement, the Company shall pay to Belair, additional fees, at the rate of $250 per hour; provided, however, that such additional services were requested by the Company, and that such additional fees were approved in advance by the Company.

D. Representations & Covenants of the Company:

The Company shall provide Belair with copies of or access to all data and information relating to the Company. In addition, the Company will make available to Belair such members of management of the Company as Belair may deem necessary so that Belair can perform its services hereunder.

Belair shall be entitled to rely upon and shall not be under any obligation to verify independently the accuracy of any information, whether oral or written, concerning the Company, or any of its affiliates, or any of its representatives, including data or information furnished or given by the Company or by any of its directors, officers, employees, agents or consultants, or by the auditors of the Company, to Belair hereunder.

No oral or written advice which is provided to the Company or its affiliates, by Belair pursuant to this Agreement, shall, in whole or in part, be quoted, excerpted, referred to or attributed to Belair in any document or in any communication with any person except with the prior express permission, provided in writing by Belair. Belair will have no authority to bind the company with respect to any matter and shall not have any responsibility or liability for any loss incurred by the Company or its affiliates, employees, creditors or shareholders or to any other person, including as a result of the publication, reproduction or use of any such advice contrary to the provisions of this paragraph.

Belair and each of its directors, officers, employees and agents will keep strictly confidential Belair’s engagement hereunder, the existence of this Agreement and the terms of this Agreement and will not disclose same without prior written consent of the Company. Belair shall keep all non-public information, data and documents relating to the Company provided to it by or on behalf of the Company, or otherwise acquired by it, in connection herewith (the “Company’s Information”) strictly confidential and shall not disclose any of the same except (a) to those officers, employees, agents and advisors of Belair who require access thereto for any purpose in connection with this Agreement, or (b) as may be required by law or in connection with any legal or regulatory proceedings, provided that in the event that Belair becomes regally compelled to disclose any of the Company’s Information, Belair will provide the Company with prompt written notice before the Company’s Information is disclosed so that the Company may seek an appropriate remedy or waive compliance with the provisions of this Agreement. In the event that such remedy is not obtained, or that the Company waives compliance with the provisions of this Agreement, Belair will furnish only that portion of the Company’s Information which it is advised by written opinion of counsel that such disclosure is legally required and Belair will exercise its best efforts to obtain a protective order or other reliable assurance that confidential treatment will be accorded to the Company’s Information, to the extent reasonably possible. The terms of this section of the Agreement shall remain enforceable notwithstanding the expiration or early termination of this Agreement, for a period of 18 months following such expiration or early termination.

Except as otherwise provided in this Agreement, neither this Agreement nor any rights or obligations hereunder shall be assigned by either party, in whole or in part, except with the prior written consent of the other party. This Agreement is solely for the benefit of the Company and Belair and shall be binding upon and inure to the benefit of their respective successors and permitted assigns.

This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the parties hereby irrevocably submit to the jurisdiction of the courts of the Province of Ontario.

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E. Financing Activities, Belair’s Limited Role:

The Company understands and agrees that Belair’s role is that of an advisor and a consultant, and that Belair has not made any commitment to raise any funds for the Company, and its functions do not include fund raising and are limited to an advisory and consultancy role and at most may include making introductions to qualified investors and/or their representatives, and that neither Belair nor its affiliates shall otherwise take part in any fundraising effort, and shall receive no compensation, directly or indirectly, as a consequence of any financing, whether successful or unsuccessful.

F. Relationship of Parties:

Belair’s role shall not be that of a principal, a partner, an employee or that of a broker-dealer. Nor shall it be a decision-maker with regard to any aspect of the Company’s operations. Instead, its role shall be limited to that advisor.

The foregoing accurately reflects the terms of the transaction and the undersigned by executing below represent that he or she has the authority to bind the party upon whose behalf he or she is executing, and hereby agrees to and enters into this Agreement intending to bind the party hereby.

Upon execution of this agreement Belair will immediately provide TruXmart with a due diligence cheek list and corporate execution timeline.

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BELAIR CAPITAL PARTNERS INC.
By	/s/ William Carr	December 11, 2014
Name:	William Car
Title:	Senior Analyst
TRUXMART LTD.:
By:	/s/ Steven Rossi	December 11, 2014
Name:	Steven Rossi
Title:	CEO

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EX-10.4

EXHIBIT 10.4

EX-10.5

EXHIBIT 10.5

EX-10.6

EXHIBIT 10.6

EX-10.7

EXHIBIT 10.7

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2

3

4

 

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EX-16.1

EXHIBIT 16.1

December 17, 2014

United States Securities and Exchange Commission

Office of the Chief Accountant

100 F Street, N.E.

Washington, D.C. 20549

Re: Franchise Holdings International, Inc.

Ladies and Gentleman:

We have read the statements under item 4.01 in the Form 8-K dated December 17, 2014, of Franchise Holdings International, Inc. (the “Company”) to be filed with the Securities and Exchange Commission and we agree with such statements therein as related to our firm. We have no basis to, and therefore, do not agree or disagree with the other statements made by the Company in the Form 8-K.

Very truly yours,

/s/ BF Borgers CPA PC

BF Borgers CPA PC

Certified Public Accountants

Lakewood, CO