What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2020-12-30 compared with 2020-04-01 · 828 added, 788 removed, 640 unchanged (72% of the section changed)

Controls and Procedures

Evaluation of Disclosure

Controls and Procedures

of Disclosure Controls and Procedures

Principal Executive Officer and Principal Financial Officer conducted an evaluation of the effectiveness of our disclosure controls

and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”).

Based on this evaluation, our Principal Executive Officer and Principal Financial Officer concluded that in light of the material

1 unchanged sentence

See material weaknesses

discussed below in Management’s Annual Report on Internal Control over Financial Reporting.

Management’s

Annual Report on Internal Control Over Financial Reporting

22 unchanged sentences

identified material weaknesses:

have not established and/or maintained adequately designed internal controls in order

to prevent or detect and correct material misstatements to the financial statements,

including internal controls related to complex or nonroutine transactions.

have not established and/or maintained adequately designed internal controls in order to prevent or detect and correct material

misstatements to the financial statements, including internal controls related to complex or nonroutine transactions.

We lack the necessary accounting resources with sufficient SEC

reporting experience, US GAAP knowledge and accounting experience.

believes that despite our material weaknesses, our consolidated financial statements for the year ended September 30, 2020 are

4 unchanged sentences

Limitations Over Internal Controls

including our CEO and CAO, does not expect that disclosure controls and internal controls will prevent all errors and all fraud.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives

of the control system are met.

Further, the design of a control system must reflect the fact that there are no resource constraints,

and the benefits of controls must be considered relative to their costs.

Because of the inherent limitations in all control systems,

no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company

have been detected.

These inherent limitations include the realities that judgements in decision-making can be faulty, and that

breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual acts of

some persons, by collusion of two or more people or by management override of the controls.

including our Principal Executive Officer and Principal Financial Officer, does not expect that disclosure controls and internal

controls will prevent all errors and all fraud.

A control system, no matter how well conceived and operated, can provide only

reasonable, not absolute, assurance that the objectives of the control system are met.

Further, the design of a control system

must reflect the fact that there are no resource constraints, and the benefits of controls must be considered relative to their

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that

all control issues and instances of fraud, if any, within the Company have been detected.

These inherent limitations include the

realities that judgements in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management

override of the controls.

Other Information

Directors, Executive Officers and Corporate Governance Directors and Executive Officers

directors and executive officers and their ages at March 25, 2020, are listed in the following table:

Bart Mitchell

Chief Executive Officer

Chief Accounting Officer

JoyAnn Kenny-Charlton

Christopher Rego

Mitchell became a de facto director of the Company in July 2017 , formally effectuated in August of 2017, and was appointed

to be the Chief Operating Officer/Chief Financial Officer on October 15, 2018.

Since September 2019, Mr.

Mitchell has served as

Chief Executive Officer of the Company.

Mitchell , is a founding member and partner of Greenbrier Academy for Girls

(“GBA”), a residential therapeutic boarding school.

He served as the Chief Operating Officer and Chief Financial Officer

from June 2007 through August 2016, successfully navigating the company through startup and establishing it as a thought leader

and premier academy in its highly competitive niche.

Prior to his time at GBA, Mr.

Mitchell was an officer and managing member

of TAS Development, LLC from 2005 until 2007.

From 2002 until 2005, he was department director for the Alldredge Academy.

Mitchell served as a manager for Xlear Inc., from 2000 until 2002.

He also is the owner and creator of Escape Game Coeur d’Alene,

which provides live interactive adventure games focused on cooperative teamwork to solve puzzles and accomplish tasks to escape

a themed game space.

Mitchell holds degrees in philosophy from Brigham Young University and English from Dixie State University.

Mitchell’s experience with both the financial and operations of GBA, including working with a curriculum team to provide

flexible, engaging academics, give him unique and valuable insights that will prove to be an asset for the Company.

was appointed Chief Accounting Office on October 1, 2019.

He started and operated Express Service for 18 years which serviced

over 2,000 restaurants, hotels, and health care facilities in five Rocky Mountain States.

This involved sales, logistics, financial

& operational challenges.

After selling his business in 2011 he started and currently operates Benchmark Bookkeeping which

works with over 200 businesses in the Northwest U.S.

This involves all levels of financial and operational duties with the owners

and employees of each business.

He owns and leases several warehouses in Boise, Idaho.

Boyd has a degree from Brigham Young

University in Business & Finance and teaches Quickbooks Certification courses in the Boise, Idaho area.

Herman became a de facto director of the Company in July 2017 , formally effectuated in August of 2017.

many years of investment experience with a focus on undervalued public companies.

Since 2002, Mr.

Herman has been a managing member

of Galloway Capital Management, LLC, which, through its fund, Strategic Turnaround Equity Partners, LP (Cayman) has focused on

investments primarily in undervalued securities.

From January 2011 to August 2013, Mr.

Herman was a managing member of Abacoa

Capital Management, LLC, which, through its fund, Abacoa Capital Master Fund, Ltd.

focused on a Global-Macro investment strategy.

Since 2005, Mr.

Herman has been a registered representative with Arcadia Securities LLC, a FINRA-registered broker-dealer based

From 1997 to 2002, he was an investment banker with Burnham Securities, Inc.

From 1993 to 1997, he was a managing

partner of Kingshill Group, Inc., a merchant banking and financial firm with offices in New York and Tokyo.

Herman also has

franchising experience, having served on the boards of several franchised concepts, including Arthur Treacher’s Fish &

Chips, Wall Street Deli Systems, Inc., Shells Seafood Restaurants, Inc., and Miami Subs Corporation where he also served as President

from 2007 to 2009.

Herman has a B.S.

from the State University of New York at Albany with a major in Political Science and

minors in Business and Music.

Herman has served on the boards of public and private companies for many years, including Tumbleweed

Holdings, Inc., since 2001.

His experience has included board membership, corporate officer, advisory, capital raising and restructuring

We believe that these experiences make Mr.

Herman well-qualified to serve as a member of the Board.

Our directors and executive

officers and their ages at December 21, 2020, are listed in the following table:

and Chief Executive Officer

and President

Kenny-Charlton

Gary Zell, II

Financial Officer

Christopher Rego became

a director in February 2020, at which time he also became chief executive officer of BFK Franchise Company, LLC (“BFK”),

our principal operating subsidiary.

On April 30, 2020, Mr.

Rego became Chief Executive Officer of the Company.

Rego has over

20 years of software quality development experience building complex enterprise applications with high-performance requirements

in the business-to-business, software-as-a-service, and consumer advertising industries.

Rego is an accomplished corporate

strategist and drives the vision and strategic direction of his software company, Teknowland, Inc., and his STREAM education company,

Bricknowland, Inc.

Rego has assembled a dedicated team of engineers that focuses on building STREAM education that includes

AR/VR learning technology, drones, artificial intelligent education, 3-D printing, coding, and more.

Rego has been the CEO

of Teknowland, Inc.

since 2013, and the founder and managing partner of Bricknowland, Inc., since 2015.

From March 2014 until

April 2016, Mr.

Rego was Quality Assurance Consulting/Manager at Tibco Software.

Rego has also held various management and

architect roles to contribute to the success of rapidly growing technology companies such as Oracle, Yahoo!, Tapjoy, and Intuit.

Rego has been a Bricks 4 Kidz franchisee since November 2013, and has been a partner with Mr.

Simento in a Bricks 4 Kidz franchise

in the United Arab Emirates since May 2015.

Rego earned a Bachelor of Science degree from Andhra Loyola College in Andhra

Pradesh India and an MBA in Marketing and Finance from Acharya Nagarjuna University Andhra Pradesh, India.

Whiton became a director in February 2020.

On June 2, 2020, Mr.

Whiton became the president of the Company.

has over 20 years of experience managing public and private investments.

His experience focuses largely on early stage and turnaround

operations in franchising, technology, biometrics, manufacturing, and payment processing.

In addition, Mr.

Whiton was an early

investor in the Company and served as its Interim CEO from July 22, 2015 to May 11, 2017.

He has owned and managed a successful

private cosmetics company for over 10 years.

From October 2016 to the present, Mr.

Whiton has been managing member of Trew Pharma

LLC, which used to manufacture, markets, and distributes beauty products (but is in the process of winding down operations), and

from January 2019 to the present has been CEO of Smart Tires USA LLC, a franchise company that provides a rent-to-own program

Kenny-Charlton has served as a director of the Company since July 2015.

2 unchanged sentences

distribution law.

Kenny-Charlton is a member of the International Franchise Association and has been repeatedly named a “Legal

Eagle” by the Franchise Times for her work in the field of franchise law.

Kenny-Charlton is a member of the International Franchise Association and has been repeatedly named a “Legal

by the Franchise Times for her work in the field of franchise law.

Kenny-Charlton is a graduate of Villanova

1 unchanged sentence

from Villanova University.

Rego became a director in February 2020, at which time he also became chief executive officer of BFK Franchise Company, LLC

(“BFK”), our principal operating subsidiary.

At the earlier to occur of March 31, 2020 or when the Company files its

Form 10-K for the year ended September 30, 2019 and its Form 10-Q for the period ended December 31, 2019, Mr.

Rego will become

Chief Executive Officer of Creative Learning Corporation.

Rego has over 20 years of software quality development experience

building complex enterprise applications with high-performance requirements in the business-to-business, software-as-a-service,

and consumer advertising industries.

Rego is an accomplished corporate strategist and drives the vision and strategic direction

of his software company, Teknowland, Inc., and his STREAM education company, Bricknowland, Inc.

Rego has assembled a dedicated

team of engineers that focuses on building STREAM education that includes AR/VR learning technology, drones, artificial intelligent

education, 3-D printing, coding, and more.

Rego has been the CEO of Teknowland, Inc.

since 2013, and the founder and managing

partner of Bricknowland, Inc., since 2015.

From March 2014 until April 2016, Mr.

Rego was Quality Assurance Consulting/Manager

at Tibco Software.

Rego has also held various management and architect roles to contribute to the success of rapidly growing

technology companies such as Oracle, Yahoo!, Tapjoy, and Intuit.

Rego has been a Bricks 4 Kidz franchisee since November 2013.

Rego earned a Bachelor of Science degree from Andhra Loyola College in Andhra Pradesh India and an MBA in Marketing and Finance

from Acharya Nagarjuna University Andhra Pradesh, India.

Whiton became a director in February 2020.

Whiton has over 20 years of experience managing public and private investments.

His experience focuses largely on early stage and turnaround operations in franchising, technology, biometrics, manufacturing,

and payment processing.

In addition, Mr.

Whiton was an early investor in the Company and has served as its Interim CEO from July

22, 2015 to May 11, 2017.

He has owned and managed a successful private cosmetics company for over 10 years.

From October 2016

to the present, Mr.

Whiton has been managing member of Trew Pharma LLC, which manufactures, markets, and distributes beauty products,

and from January 2019 to the present has been CEO of Smart Tires USA LLC, a franchise company that provides a rent-to-own program

Whiton does not have a formal college degree.

On May 16, 2002, the National Association of Securities Dealers,

entered an order barring Mr.

Whiton from association with any NASD member in any capacity as a result of his failure to respond

to a request for information.

has served as a director of the Company since May 19, 2020.

Simento is the co-founder and managing partner of Almoe Group of

Companies, founded in 1994, Specktron Educational Products, founded in 2011 and Bricknowland founded in 2015.

Simento has over

three decades of executive leadership experience managing high-technology and high-growth companies, having been responsible for

strategic direction, execution of business plans, technology development, and development of corporate infrastructure.

of Companies consists of six divisions, employs over 400 staff spread across four countries, and has over 40 renowned audio visual

and IT products and solutions.

The Almoe Group of Companies partners with over 55 audio and video and software companies that provide

AV and software solutions to retail, corporate, and education institutions.

Mr Simento created his own product line, Specktron

(www.specktron.com) that is a leading brand pioneering in Audio Visual and Information & Communication Technology.

has championed the use of Interactive Touch Technology for the education, corporate, government, and hospitality sectors.

has been a partner with Mr.

Rego in a Bricks 4 Kidz franchise in the United Arab Emirates since May 2015.

Gary Zell, II has served as a director of the Company since May 19, 2020.

Zell has been a Multiple Line General Agent with

American National Insurance Company since 1994, responsible for sales, profitability, and recruiting of a $62 million+ insurance

agency with over 70 agents and subproducers.

From 2016 to the present, Mr.

Zell has been president of ThirdPatent Holdings and

ThirdPro HMM, which provide social media audits for parents, colleges, universities, human resources professionals, and professional

Zell earned a Bachelors Degree in Economics from Sewanee:

The University of the South in Sewanee, Tennessee.

Mike Elkin became

the Company’s Chief Financial Officer on October 1, 2020.

Elkin has over 20 years of experience as a controller and financial

His experience includes providing financial and accounting advice to REIT’s, non-profits and turnaround situations

in the manufacturing, distribution and service company sectors.

Since 2017, Mr.

Elkin has served as the controller for a private

Real Estate Investment Trust (“REIT”).

From 2005 to 2006, Mr.

Elkin operated a consulting business in which he served

as part-time controller or chief financial officer for various private businesses.

Elkin has a B.S.

Degree in Accounting from

the University of Florida, a Masters Degree in Accounting from Nova Southeastern University, and a Masters Degree in Finance from

Florida International University.

Elkin has been recognized by the Jacksonville Business Journal as CFO of the year.

also honored by the Jacksonville Jewish Journal for Social Action Work in the community.

of the directors and executive officers share any familial relationship with any other executive officers or key employees.

1 unchanged sentence

Nomination Process

Board is responsible for overseeing the selection of persons to be nominated to serve on our Board, and has not formed a separate

Board is responsible for overseeing the selection of persons to be nominated to serve on our Board, and has not formed separate

nominating committee.

The Board believes that nominating decisions are best determined by the entire board in light of a recent

proxy solicitation effort by certain shareholders to make changes to the board’s composition.

The Board does not have a

5 unchanged sentences

Depending upon the current needs of the Board, certain factors may be weighed more or less heavily.

considering candidates for the Board, the directors evaluate the entirety of each candidate’s credentials and do not have

any specific minimum qualifications that must be met.

“Diversity,” as such, is not a criterion that the Board considers.

“Diversity,”

as such, is not a criterion that the Board considers.

The directors will consider candidates from any reasonable source, including current Board members, stockholders, professional

4 unchanged sentences

under our corporate governance principles.

The Board received one director nominee recommendation from stockholders for the 2020

Annual Meeting, which was Mark David Shaw (a shareholder who nominated himself).

Audit Committee

have a separately designated standing Audit Committee established in accordance with Section 3(a)(58)(a) of the Exchange Act.

The Audit Committee met four times in fiscal 2019.

The only member of the Audit Committee is Gary Herman.

Audit Committee is responsible for oversight of the quality and integrity of the accounting, auditing and reporting practices

of the Company.

More specifically, it assists the Board of Directors in fulfilling its oversight responsibilities relating to

(i) the quality and integrity of our financial statements, reports and related information provided to stockholders, regulators

and others, (ii) our compliance with legal and regulatory requirements, (iii) the qualifications, independence and performance

of our independent registered public accounting firm, (iv) the internal control over financial reporting that management and the

Board have established, and (v) the audit, accounting and financial reporting processes generally.

The Committee is also responsible

for review and approval of related-party transactions.

The Audit Committee has the authority to obtain advice and assistance from,

and receive appropriate funding from the Company for, outside legal, accounting or other advisors as it deems necessary to carry

out its duties.

Audit Committee

Financial Expert

Board has determined that Mr.

Herman is an “audit committee financial expert” within the meaning of SEC rules.

Code of Ethics

Company has adopted a Code of Ethics applicable to its principal executive, financial and accounting officers and persons performing

similar functions, as well as all directors and employees of the Company.

A copy of the Code of Ethics is filed as an exhibit

to this report, and posted on the Company’s website, www.creativelearning.com .

the Company will provide a copy of the Code of Ethics to any shareholder who submits a written request in writing to our chief

executive officer at Creative Learning Corp., P.O.

Box 4502, Boise, Idaho 83711;

bmitchell@creativelearningcorp.com .

There have been no material changes to the procedures by which shareholders may recommend

nominees to our board of directors.

Committee Functions

May 2020, we have not had a separately designated standing Audit Committee established in accordance with Section 3(a)(58)(a)

of the Exchange Act.

Prior to May 2020, we had an Audit Committee, the only member of which was Gary Herman.

When constituted,

the Audit Committee is responsible for oversight of the quality and integrity of the accounting,

auditing and reporting practices of the Company.

More specifically, it assists the Board of Directors in fulfilling its oversight

responsibilities relating to (i) the quality and integrity of our financial statements, reports and related information provided

to stockholders, regulators and others, (ii) our compliance with legal and regulatory requirements, (iii) the qualifications,

independence and performance of our independent registered public accounting firm, (iv) the internal control over financial reporting

that management and the Board have established, and (v) the audit, accounting and financial reporting processes generally.

Committee is also responsible for review and approval of related-party transactions.

The Audit Committee has the authority to

obtain advice and assistance from, and receive appropriate funding from the Company for, outside legal, accounting or other advisors

as it deems necessary to carry out its duties.

During periods in which the Company does not have an active Audit Committee, the

entire board performs the functions of the Audit Committee.

Committee Financial Expert

Board has determined that it does not have an “audit committee financial expert”

within the meaning of SEC rules.

The Company has adopted

a Code of Ethics applicable to its principal executive, financial and accounting officers and persons performing similar functions,

as well as all directors and employees of the Company.

A copy of the Code of Ethics is filed as an exhibit to this report, and

posted on the Company’s website, www.creativelearningcorp.com.

In addition, the Company will provide a copy of the Code of

Ethics to any shareholder who submits a written request in writing to our chief executive officer at Creative Learning Corp., 475

W Townplace, Suite, A, St.

Augustine, FL 32092;

rwhiton@creativelearningcorp.com

Communication

4 unchanged sentences

to the addressees or distributed at the next scheduled board meeting;

relate to financial or accounting matters, forwarded to the audit committee or distributed at the next scheduled audit committee

relate to executive officer compensation matters, forwarded to the compensation committee or discussed at the next scheduled

they relate to financial or accounting matters, forwarded to the audit committee or distributed at the next scheduled audit

committee meeting;

they relate to executive officer compensation matters, forwarded to the compensation committee or discussed at the next scheduled

compensation committee meeting;

relate to the recommendation of the nomination of an individual, forwarded to the full Board or discussed at the next scheduled

Board meeting;

relate to our operations, forwarded to the appropriate officers of our company, and the response or other handling of such

communications reported to the Board at the next scheduled board meeting.

Section 16(a)

Beneficial Ownership Reporting Compliance

they relate to the recommendation of the nomination of an individual, forwarded to the full Board or discussed at the next

scheduled Board meeting;

they relate to our operations, forwarded to the appropriate officers of our company, and the response or other handling of

such communications reported to the Board at the next scheduled board meeting.

16(a) Beneficial Ownership Reporting Compliance

16(a) of the Exchange Act requires directors, executive officer and persons who beneficially own more than 10% of a registered

5 unchanged sentences

of registered equity security failed to file on a timely basis any such report, except as follows:

Gary Herman, Bart Mitchell and JoyAnn Kenny-Charlton failed to file a Form 4 reporting the Board’s approval of the issuance

of 272,472, 112,739 and 272,472 shares of common stock to them for board services on September 30, 2019;

Gary Herman failed to file a Form 4 reporting the issuance of 7,143 shares of common stock to him from the exercise of a warrant;

Blake Furlow filed a late Form 4 reporting the issuance of 566,176 shares of common stock to him for his services as an officer

and the issuance of 7,143 shares of common stock to him as a result of the exercise of a warrant.

Furlow failed to file a

Form 4 reporting the Board’s approval of the issuance of 99,362 shares to him for board services on September 30, 2019,

which shares were issued in January 2020.

● John Simento, a director, failed to file a Form 3 after he was elected to the board of directors

on May 19, 2020;

Gary Zell, II, a director, failed to file a Form 3 after he was elected to the board of directors

on May 19, 2020;

Whiton, an officer and director, filed a late Form 4 on May 27, 2020 reporting the purchase

of 800,000 shares of common stock on May 7, 2020;

● Blake Furlow, a 10% shareholder, filed a late Form 4 on May 26, 2020 reporting various transactions

between January 16, 2020 and May 8, 2020, including the sale of 800,000 shares to Mr.

Executive Compensation

following identifies the elements of compensation for fiscal years 2019 and 2018 with respect to our “named executive officers,”

which term is defined by Item 402 of the SEC’s Regulation S-K to include (i) all individuals serving as our principal executive

following identifies the elements of compensation for fiscal years 2020 and 2019 with respect to our “named executive officers,”

which term is defined by Item 402 of the SEC’s Regulation S-K to include (i) all individuals serving as our principal executive

officer at any time during fiscal year 2020, (ii) our two most highly compensated executive officers other than the principal

3 unchanged sentences

Company at September 30, 2020.

on our compensation for the fiscal year ended September 30, 2019, Blake Furlow and Bart Mitchell constitute our only “named

executive officers” pursuant to Item 402 of Regulation S-K.

Summary Compensation Table

following table shows the compensation paid or accrued to the Company’s named executive officers during the fiscal years

ended September 30, 2019 and 2018.

and Principal Position

Blake Furlow(4)

Based on our compensation

for the fiscal year ended September 30, 2020, Bart Mitchell, Rod Whiton and Christopher Rego constitute our only “named

executive officers”

pursuant to Item 402 of Regulation S-K.

Compensation Table

Name and Principal Position

Christopher Rego (2)

Bart Mitchell (3)

This amount is the dollar value of base salary earned.

Includes 566,176 shares issuable to Mr.

Furlow as a bonus under his employment agreement valued at $35,000 as well as 166,667 shares issuable to Mr.

Mitchell as a bonus under his employment agreement valued at $10,000.

Also includes board compensation earned during the year ended September 30, 2019 by Blake Furlow in the total amount of $5,962 and by Bart Mitchell in the total amount of $6,764.

Includes severance earned by Blake Furlow during the year ended September 30, 2019 in the amount of $30,000.

Also includes a $1,000 warrant exercise price that was waived during the year for Blake Furlow.

Includes cash amounts of board compensation earned by both Blake Furlow and Bart Mitchell in the amounts of $14,375 and $10,416, respectively.

Blake Furlow acted as our CEO from August 15, 2018 to September 30, 2019, when he resigned.

Bart Mitchell acted as our CFO and COO from October 15, 2018 to September 30, 2019.

CEO, CFO and COO

Whiton acted as our president from June 2, 2020 to September 30, 2020, and our Principal Executive Officer from August 4, 2020 to September 30, 2020.

Christopher Rego acted as our president of one of our operating subsidiaries from February 5, 2020 to April 30, 2020, and CEO from May 1,, 2020 to September 30, 2020.

Rego was our Principal Executive Officer from May 1, 2020 to August 4, 2020.

Bart Mitchell acted as our CEO from October 1, 2019 to April 29, 2020, when he was replaced by Mr.

Rego, and as our president from May 2020 to June 2, 2020, when he resigned.

Mitchell acted as our CFO and COO from October 15, 2018 to September 30, 2019.

Mitchell was our Principal Executive Officer from October 1, 2019 to April 30, 2020.

Consists of 166,667 shares issued to Mr.

Mitchell in 2019 as a bonus under his employment agreement valued at $10,000, and 112,739 shares issued to Mr.

Mitchell in 2019 for board compensation valued at $6,764.

Consists of $50,000 of severance paid to Mr.

Mitchell in 2020 upon his resignation, and a cash amounts paid to Mr.

Mitchell of $10,416 in 2019 for board compensation.

Company does not provide its officers or employees with pension, stock appreciation rights, long-term incentive or other plans.

The Company does not have a defined benefit, pension, profit sharing plan but does offer a 401(k) plan.

Outstanding Equity

Awards At Fiscal Year-End

We did not grant any stock

options or stock appreciation rights to our named executive officers in the last fiscal year.

We did not reprice any options or

stock appreciation rights during the last fiscal year.

We did not waive or modify any specified performance target, goal or condition

to payout with respect to any amount included in any incentive plan compensation included in the summary compensation table.

Board is responsible for creating and reviewing the compensation of our executive officers, as well as overseeing our compensation

and benefit plans and policies and administering our equity incentive plans.

We believe in providing a competitive total compensation

package to its executives through a combination of base salary, annual performance bonuses, and long-term equity awards.

The executive

compensation program is designed to achieve the following objectives:

competitive compensation that will help attract, retain and reward qualified executives;

executives’

interests with our success by making a portion of the executive’s compensation dependent upon corporate

executives’

interests with the interests of stockholders by including long-term equity incentives.

Board believes that our executive compensation program should include annual and long-term components, including cash and equity-based

compensation, and should reward consistent performance that meets or exceeds expectations.

The Board evaluates both performance

and compensation to make sure that the compensation provided to executives remains competitive relative to compensation paid by

companies of similar size and stage of development operating in the payment processing industry and taking into account our relative

performance and its own strategic objectives.

Equity Awards At Fiscal Year-End

of the named executive officers have any unvested equity awards or unexercised options in the Company as of September 30, 2020.

Employment Agreements

We have entered into an

employment agreement with Bart Mitchell, our current chief executive officer, dated October 16, 2018.

Under the employment agreement,

Mitchell is to be employed as our chief financial officer and chief operating officer, is entitled to cash compensation of

$125,000 per year, and is entitled to a grant of restricted stock with a value of $10,000 on the last day of each completed year

of employment.

Mitchell is also entitled to discretionary bonuses on an annual basis, and the right to participate in medical

and dental coverage, a 401K plan and any other benefits offered to employees of the Company.

Effective October 1, 2019, Mr.

was appointed Chief Executive Officer of the Company.

Payments upon Termination or Change in Control

our employment agreement with Mr.

Mitchell, our current chief executive officer, Mr.

Mitchell is entitled to terminate his agreement

upon a change of control, in which event he is entitled to severance equal to three months’ base salary, and any stock options

or stock grants for the quarter in which the change of control occurs as well as the following three quarters.

A change of control

is defined as any change in the members of the board of directors amounting to a change in the majority of seats on the board.

In addition, if the Company is taken private, Mr.

Mitchell is entitled to an acceleration of the annual stock grant to which is

Director Compensation

were party to an employment agreement with Bart Mitchell, our current chief executive officer, dated October 16, 2018.

employment agreement, Mr.

Mitchell was employed as our chief financial officer and chief operating officer, was entitled to cash

compensation of $125,000 per year, and was entitled to a grant of restricted stock with a value of $10,000 on the last day of

each completed year of employment.

Mitchell is also entitled to discretionary bonuses on an annual basis, and the right to

participate in medical and dental coverage, a 401K plan and any other benefits offered to employees of the Company.

October 1, 2019, Mr.

Mitchell was appointed our chief executive officer, and no longer served as our chief financial officer or

chief operating officer.

At the same time, the Company entered into an employment agreement with Mr.

Mitchell dated October 1,

2019, which had a term of one year.

Under the employment agreement, Mr.

Mitchell was entitled to a base salary of $150,000 per

In addition, Mr.

Mitchell was entitled to a stock grant on the last day of the term of his employment equal to the lesser

of the shares of common stock with a value of $15,000 or 200,000 shares.

In the event Mr.

Mitchell was terminated prior to the

end of the term of the agreement, the number of shares would be prorated based on the actual number of days he worked for the

April 30, 2020, Christopher Rego was appointed chief executive officer of the Company, and Bart Mitchell was appointed president

of the Company.

On June 2, 2020 Bart Mitchell tendered his resignation to the Company as president, effective as of the close

of business on June 8, 2020.

At such time he received a severance package of $50,000.

June 8, 2020, the Company’s board approved a salary of $120,000 per year for Mr.

Rego, the Company’s chief executive

The Company does not have an employment agreement with Mr.

June 2, 2020, the Company’s board approved a salary of $100,000 per year for Mr.

Whiton, the Company’s president.

Company does not have an employment agreement with Mr.

and Change of Control Benefits

Company does not currently have any agreements with its named executive officers or directors which provide for severance or change

of control benefits.

Benefit Plans and Pension Benefits

Company does not provide its officers or employees with pension, stock appreciation rights, long-term incentive or other plans.

The Company does not have a defined benefit, pension or profit-sharing plan.

Company sponsors a 401(k) plan, in which our named executive officer’s are allowed to participate on

the same basis as our other employees.

Effective May 1, 2015, our Board approved a matching contribution of 100% on the first 4%

of an employee’s compensation which is treated as an elective deferral.

During the years ended September 30, 2020 and 2019,

the Company made contributions to this plan of approximately $10,775 and $5,633, respectively.

Deferred Compensation

of our NEOs are covered by a deferred contribution or other plan that provides for the deferral of compensation on a basis that

is not tax-qualified.

following table details the total compensation earned by our non-employee directors during the year ended September

Cash ($)(1)(3)

Incentive Plan

Kenny-Charlton

Herman and Ms.

Kenny-Charlton earned $19,000 and $10,000 of cash compensation for board

services in fiscal 2019, which was paid following the end of the fiscal year.

fiscal 2019, Mr.

Herman and Ms.

Kenny-Charlton received restricted stock awards of 272,472

shares each for their service on the board for the fiscal years 2017, 2018 and 2019.

JoyAnn Kenny-Charlton

Gary Zell, II

35,714 shares issued to Mr.

Herman for director compensation valued at $2,500.

travel expense reimbursements.

2 unchanged sentences

September 30,

Kenny-Charlton

JoyAnn Kenny-Charlton

a more detailed description of the assumptions used for purposes of determining grant date fair value, see Note (1) to the Consolidated

Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical

Accounting Policies—Share-Based Compensation” included in the Form 10-K for the 2019 fiscal year.

Board has approved a compensation policy for our directors under which we pay our directors who are not also officers total compensation

of $20,000 per year, consisting of $10,000 cash and common shares with a value of $10,000 based on the average 30 day trailing

closing price of the common stock as the last day of each fiscal year.

In addition, the chairman of the Board receives additional

compensation of $5,000 per year, and the Audit Committee chairman receives additional compensation of $9,000 per year.

also reimburse our directors for reasonable travel and other related expenses.

Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical

Accounting Policies—Share-Based Compensation”

included in the Form 10-K for the 2020 fiscal year.

Board does not have a current compensation policy for its directors.

However, we reimburse our directors for reasonable travel

and other related expenses.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

following table sets forth, as of March 25, 2020, certain information concerning the beneficial ownership of our common stock

following table sets forth, as of December 21, 2020, certain information concerning the beneficial ownership of our common stock

by (i) each person known by us to own beneficially five percent (5%) or more of the outstanding shares of each class,

11 unchanged sentences

not constitute an admission of beneficial ownership of those shares.

Name and Address of Beneficial

and Nature of

Name and Address of Beneficial Owner

Amount and Nature of

Beneficial Ownership

5% Beneficial Owners:

5 unchanged sentences

Augustine, FL 32080

Named Executive Officers, Directors, and Nominees:

JoyAnn Kenny-Charlton (4) (8)

Mark David Shaw

11542 Davis Creek Court

Jacksonville, FL 32256

Named Executive Officers and Directors:

Rod Whiton (4) (7)

JoyAnn Kenny-Charlton (5) (7)

Christopher Rego (6) (7)

Gary Herman (7) (8)

Bart Mitchell (8)

John Simento (7)

1 unchanged sentence

All Officers and Directors as a Group

upon 13,613,430 shares of Common Stock issued and outstanding as of March 25, 2020.

upon 13,298,310 shares of Common Stock issued and outstanding as of December 21, 2020.

51,029 shares owned by Mr.

1 unchanged sentence

shares held by Cote Trading, LLC, an entity controlled by Ms.

216,000 shares issuable pursuant to warrants held by Ms.

Kenny-Charlton which are immediately exercisable.

6,067 shares held in UTMA accounts for Mr.

1 unchanged sentence

Whiton has voting and dispositive power.

216,000 shares issuable pursuant to warrants held by Ms.

Kenny-Charlton which are immediately exercisable.

shares are owned in joint tenancy with the spouse.

shares held by GH Ventures, LLC, an entity managed by Mr.

address for the shareholder is c/o Creative Learning Corp., P.O.

Box 4502, Boise, Idaho 83711.

pending nominee to the board of directors.

address for the shareholder is c/o Creative Learning Corp., 475 W Townplace, Suite, A, St.

Augustine, FL 32092.

COMPENSATION PLAN INFORMATION

The following

table provides information as of September 30, 2019 about the securities issued, or authorized for future issuance, under our

equity compensation plans.

to be issued upon exercise of outstanding options, warrants

following table provides information as of September 30, 2020 about the securities issued, or authorized for future issuance,

under our equity compensation plans.

Plan Category

securities to be issued upon exercise of outstanding options, warrants

average exercise price of

4 unchanged sentences

Equity compensation plans not approved by security holders

May 2017 Options

September 2017

Options Grants

March 2019 Options

May 2017 Options Grants

September 2017 Options Grants

March 2019 Options Grants

Certain Relationships and Related Transactions, and Director Independence

December 2017, the Company entered into two standby letters of credit in the amount of $50,000 each with Blake Furlow and Gary

At the time, Mr.

Furlow was our chief executive officer and a director, and Mr.

Herman was a director.

As compensation,

Furlow and Herman each received 7,143 warrants to purchase our common stock, which were warrants valued at $1,000 each.

The Company did not draw any funds under the letters of credit, and the letters of credit have been terminated.

current Board consists of Gary Herman, JoyAnn Kenny-Charlton, Christopher Rego and Rod Whiton.

Our common stock is currently quoted

on the over the counter market.

Since the over the counter market does not have its own rules for director independence, we use

the definition of independence established by the NASDAQ Stock Market.

Under applicable NASDAQ Stock Market rules, a director

will only qualify as an “independent director” if the director at any time in the past three years (a) was employed

by us, (b) received more than $120,000 in compensation from us, other than for board services, (c) had a family member who was

employed as an executive officer of us, (d) was, or had a family member that was, a partner, controlling shareholder or executive

officer of any organization that received payments for property or services that exceeded the greater of 5% of the recipient’s

gross revenues or $200,000, (e) was, or had a family member that was, employed as an executive officer of another entity during

the past three years where any of the executive officers of us serve on the compensation committee, or (f) was, or had a family

member that was, a partner in our auditor at any time in the past three years.

At this time, we have three independent directors:

Gary Herman, JoyAnn Kenny-Charlton and Christopher Rego.[RM1]

Board has established three standing committees:

the Audit Committee, the Compensation Committee and the Executive Committee.

The Board does not have a nominating committee.

From time to time, the Board may also create various ad hoc committees for special

The current membership of each of the Audit, Compensation, and Executive Committees are described below.

The board has

determined that all of the members of each of the Audit, Compensation, and Executive Committees are independent as defined under

the rules of the NASDAQ, including, in the case of all members of the Audit Committee, the independence requirements contemplated

by Rule 10A-3 under the Exchange Act.

The following chart sets forth the directors who currently serve as members of each of the

Board committee as of the date of this annual report.

JoyAnn Kenny-Charlton

Christopher Rego

_______________________

* Chairman of the Board

“C” Denotes member and

chair of committee

“X” Denotes member

September 30, 2019, Blake Furlow resigned as Chief Executive Officer of the Company.

Furlow received a severance payment of

$30,000 pursuant to the terms of a Severance Agreement.

Pursuant to his employment agreement, the Company also issued an aggregate

of 566,176 shares of Common Stock to Mr.

September 27, 2019, in connection with their service on the Board of Directors for fiscal years 2017, 2018 and 2019, the Company

approved the issuance of (i) 99,362, (ii) 272,472, (iii) 112,739 and (iv) 272,472 shares of Common Stock to Blake Furlow, Gary

Herman, Bart Mitchell and JoyAnn Kenny-Charlton, respectively as well as a total of cash payments of $85,041.

Christopher Rego has

been a director since February 5, 2020, and our Chief Executive Officer since May 1, 2020.

Prior to his appointment, Mr.

Rego purchased

an active franchise in California.

During the year ended September 30, 2020 the Company recognized royalty revenue from the franchise

of $16,650 and recognized marketing fee revenue from the franchise of $829.

Total payments made by the franchisee were $7,681.

As of September 30, 2020 and 2019 the accounts receivable balance with the franchise was $11,894 and $21,536, respectively and

the franchises had deferred revenue balances of $0.

John Simento has been

a director of the Company since May 19, 2020.

Rego’s and Mr.

Simento’s appointments with the Company,

they purchased a Company franchise in the United Arab Emirates (the “UAE”).

The Company filed an arbitration complaint

against them in December 2019 regarding issues related to opening the franchise.

The complaint was resolved by a Settlement Agreement

dated February 5, 2020.

Under the Settlement Agreement, the Company forgave all back royalty fees through July 2019, equally $18,825,

and agreed to defer all other fees until the franchise was able to obtain a business license to operate in the U.A.E., which is

currently delayed due to the Coronavirus pandemic.

The franchise is currently non-operational as a result of an inability to obtain

the issuance of a business license form the UAE due to the Coronavirus pandemic.

If the franchise is not able to procure the necessary

authorizations to operate, the franchisees would not owe any franchise fees.

As a consequence, we have not realized any revenue

from the franchise.

Rego is also the

CEO of Teknowland, a software development company, with which the Company entered into an agreement on March 10, 2020.

of the agreement is nine months and calls for a development fee of $12,900 per month.

During the year ended September 30, 2020

the Company paid seven months payments of $12,900 in accordance with the terms of the agreement and paid an additional $15,700

for additional services, for a total of $106,000.

or about December 6, 2019, Christopher Rego and Rod Whiton (the “Solicitors”), prior to their appointments as officers

or directors of the Company, commenced a consent solicitation to the shareholders of the Company and on February 5, 2020, the Company

and the Solicitors entered into an agreement to settle their dispute over the consent solicitation.

The settlement resulted in

the Company paying $10,000 as reimbursement for certain costs that they incurred related to the consent solicitation, the Company

agreeing to appoint Mr.

Whiton to the board, and the Company’s agreeing to appoint Mr.

Rego as chief executive

officer, among other provisions.

The Company ultimately paid a total of $20,000 in costs incurred by Messrs.

Rego and Whiton in

relation to the consent solicitation.

Director Independence

Our current Board consists

of JoyAnn Kenny-Charlton, Christopher Rego, Rod Whiton, John Simento and R.

Our common stock is currently quoted on

the over the counter market.

Since the over the counter market does not have its own rules for director independence, we use the

definition of independence established by the NASDAQ Stock Market.

Under applicable NASDAQ Stock Market rules, a director will

only qualify as an “independent director”

if the director at any time in the past three years (a) was employed by us,

(b) received more than $120,000 in compensation from us, other than for board services, (c) had a family member who was employed

as an executive officer of us, (d) was, or had a family member that was, a partner, controlling shareholder or executive officer

of any organization that received payments for property or services that exceeded the greater of 5% of the recipient’s gross

revenues or $200,000, (e) was, or had a family member that was, employed as an executive officer of another entity during the past

three years where any of the executive officers of us serve on the compensation committee, or (f) was, or had a family member that

was, a partner in our auditor at any time in the past three years.

At this time, we have determined that we have three independent

JoyAnn Kenny-Charlton, John Simento and R.

Gary Zell, II.

Board does not currently have any committees.

The Board has approved the formation of an Audit Committee, and an Audit Committee

charter, but no members currently serve on the Audit Committee.

The independent directors perform the functions of the Audit Committee.

with Respect to Transactions with Related Persons

The Board has adopted

a Code of Ethics, which is available at www.creativelearningcorp.com, that sets forth various

policies and procedures intended to promote the ethical behavior of the Company’s employees, officers and directors.

Code of Ethics describes our policy on conflicts of interest.

executive officers and the Board are also required to complete a questionnaire on an annual basis which requires them to disclose

any related person transactions and potential conflicts of interest.

The responses to these questionnaires are reviewed by outside

corporate counsel, and, if a transaction is reported by an independent director or executive officer, the questionnaire is submitted

to the Audit Committee, or the independent directors if there is no Audit Committee.

If necessary, the Audit Committee or the

independent directors, as applicable, will determine whether the relationship is material and will have any effect on the director’s

independence.

After making such determination, the Audit Committee or independent directors, as applicable, will report its recommendation

on whether the transaction should be approved or ratified by the entire Board.

Principal Accountant Fees and Services.

14, 2018, Marcum LLP was engaged as the Company’s independent registered public accountants for the year ended September

Effective October

2, 2019, the Audit Committee of the Board of Directors of Creative Learning Corporation (the “Company”) approved the

engagement of MAC Accounting Group LLP (“MAC”) as the Company’s independent registered public accounting firm

for the Company’s fiscal year ending September 30, 2019, and dismissed Marcum LLP (“Marcum”) as the Company’s

independent registered public accounting firm.

The following

table shows the fees billed aggregate to the Company for the periods shown:

following table presents fees for professional services provided by MAC Accounting Group LLP for the years September 30, 2020

and 2019, respectively:

following table shows the fees billed aggregate to the Company for the periods shown:

Audit Fees (1)

1 unchanged sentence

All Other Fees (4)

Audit services include work performed for the

audit of our financial statements and the review of financial statements included in our quarterly reports, as well as work that

is normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings.

Audit-related services .

Audit-related services are for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not covered above under “audit services.”

Tax services .

Tax services include all services performed

by the independent registered public accounting firm’s tax personnel for tax compliance, tax advice and tax planning.

All other Fees .

Audit services include work performed for the audit of our financial statements and the review of financial statements

included in our quarterly reports, as well as work that is normally provided by the independent registered public accounting

firm in connection with statutory and regulatory filings.

Audit-related

Audit-related services are for assurance and related services that are reasonably related to the performance

of the audit or review of our financial statements and are not covered above under “audit services.”

Tax services include all services performed by the independent registered public accounting firm’s tax

personnel for tax compliance, tax advice and tax planning.

All other fees are those services and/or travel expenses not described in the other categories.

fees represent amounts invoiced for professional services rendered for the audit of the Company’s annual financial statements,

including the Form 10-K report, and the reviews of the quarter ending financial statements included in the Company’s Form

fees represent amounts invoiced for professional services rendered for the audit of the Company’s annual financial statements,

including the Form 10-K report, and the reviews of the quarter ending financial statements included in the Company’s Form

10-Q reports.

Pre-Approval Policy and Procedures

Audit Committee has adopted policies and procedures which set forth the manner in which the Audit Committee will review and approve

all services to be provided by the independent auditor before the auditor is retained to provide such services.

The policy requires

Audit Committee pre-approval of the terms and fees of the annual audit services engagement, as well as any changes in terms and

fees resulting from changes in audit scope or other items.

The Audit Committee also pre-approves, on an annual basis, other audit

services, and audit-related and tax services set forth in the policy, subject to estimated fee levels, on a project basis and

aggregate annual basis, which have been pre-approved by the Audit Committee.

Policy and Procedures

have adopted an Audit Committee charter, which contains policies and procedures which set forth the manner in which the Audit

Committee will review and approve all services to be provided by the independent auditor before the auditor is retained to provide

such services.

The policy requires Audit Committee pre-approval of the terms and fees of the annual audit services engagement,

as well as any changes in terms and fees resulting from changes in audit scope or other items.

The Audit Committee also pre-approves,

on an annual basis, other audit services, and audit-related and tax services set forth in the policy, subject to estimated fee

levels, on a project basis and aggregate annual basis, which have been pre-approved by the Audit Committee.

other services performed by the auditor that are not prohibited non-audit services under SEC or other regulatory authority rules

2 unchanged sentences

services and tax services require separate pre-approval of the Audit Committee.

chief financial officer reports quarterly to the Audit Committee on the status of pre-approved services, including projected fees.

All of the services reflected in the above table were approved by the Audit Committee.

of the services reflected in the above table were approved by the Audit Committee.

We have not engaged our auditor to perform

any services other than audit services.

May 2020, we have not had a separately constituted Audit Committee, and our independent board members have performed the duties

of the Audit Committee as described in the Audit Committee charter.

Exhibits, Financial Statement Schedules.

following documents are filed as part of this report:

Consolidated Financial

Financial Statements:

of Independent Registered Public Accounting Firms;

1 unchanged sentence

Statements of Operations for the years ended September 30, 2020 and September 30, 2019;

Statements of Stockholders’ Equity (Deficit) for the years ended September 30, 2019 and September 30, 2018.

Statements of Stockholders’

Equity for the years ended September 30, 2020 and September 30, 2019.

Statements of Cash Flows for the years ended September 30, 2020 and September 30, 2019;

accompanying Index to Exhibits is incorporated herein by reference.

Pursuant to the requirements

of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on

its behalf by the undersigned, thereunto duly authorized.

CREATIVE LEARNING CORPORATION

/s/ Bart Mitchell

Bart Mitchell

Chief Executive Officer

April 1, 2020

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE

PRESENTS, that each person whose signature appears below constitutes and appoints Bart Mitchell and Robert Boyd jointly and severally,

his attorney-in-fact, each with the full power of substitution, for such person, in any and all capacities, to sign any and all

amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection

therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority

to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents

and purposes as he might do or could do in person hereby ratifying and confirming all that said attorneys-in-fact and agents, or

his substitute, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities

Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities

and on the date indicated.

Bart Mitchell

Executive Officer (Principal Executive Officer)

Accounting Officer (Principal Financial and Accounting Officer)

JoyAnn Kenny-Charlton

Kenny-Charlton

Christopher Rego

INDEX TO EXHIBITS

of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s registration statement on Form SB-2, File

to Certificate of Incorporation (incorporated by reference to Exhibit 3.1.2 to the Company’s Annual Report on Form 10-K

of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s registration statement on Form SB-2, File

to Certificate of Incorporation (incorporated by reference to Exhibit 3.1.2 to the Company’s Annual Report on Form 10-K

for the fiscal year ended September 30, 2010).

and Restated Bylaws dated December 6, 2019 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report

on Form 8-K dated December 6, 2019).

relating to the acquisition of BFK Franchise Company (incorporated by reference to Exhibit 10.1 filed with the Company’s

Current Report on Form 8-K dated July 2, 2010).

5 unchanged sentences

Form 8-K dated September 30, 2019).

Agreement dated October 1, 2019 between the Company and Bart Mitchell (incorporated by reference to Exhibit 99.2 to the Current

Report on Form 8-K dated September 30, 2019).

Agreement dated October 1, 2019 between the Company and Robert Boyd (incorporated by reference to Exhibit 99.3 to the Current

Report on Form 8-K dated September 30, 2019).

Non-Qualified

Stock Option Plan (incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-8 filed

August 17, 2018, Registration No.

of Ethics (incorporated by reference to Exhibit 14 to the Company’s Annual Report on Form 10-K for the fiscal year ended

Software Development Agreement between Teknowland Inc.

and Creative Learning Corp.

dated March 10, 2020.

of Ethics (incorporated by reference to Exhibit 14 to the Company’s Annual Report on Form 10-K for the fiscal year ended

September 30, 2015)

Subsidiaries of the Company.

Rule 13a-14(a) Certification

of Principal Executive Officer.

Rule 13a-14(a) Certification

of Principal Accounting Officer.

Section 1350 Certification

of Principal Executive Officer.

Section 1350 Certification

of Principal Accounting Officer.[RM1]

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

XBRL Taxonomy Extension Label Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase

Filed herewith.

Furnished herewith.

of the Company.

13a-14(a) Certification of Principal Executive Officer.

13a-14(a) Certification of Principal Accounting Officer.

1350 Certification of Principal Executive Officer.

1350 Certification of Principal Accounting Officer.

Instance Document

Taxonomy Extension Schema Document

Taxonomy Extension Calculation Linkbase Document

Taxonomy Extension Definition Linkbase Document

Taxonomy Extension Label Linkbase Document

Taxonomy Extension Presentation Linkbase Document

of Independent Registered Public Accounting Firm

2 unchanged sentences

have audited the accompanying consolidated balance sheet of Creative Learning Corporation and its subsidiaries (the Company) as

of September 30, 2019, the related consolidated statement of operations, stockholders' equity (deficit) and cash flows for the

year then ended, and the related notes to the consolidated financial statements (collectively, the financial statements).

of September 30, 2020 and 2019, the related consolidated statement of operations, stockholders' equity (deficit) and cash flows

for the years then ended, and the related notes to the consolidated financial statements (collectively, the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of

September 30, 2019, and the results of its operations and its cash flows for the year then ended, in conformity with accounting

principles generally accepted in the United States of America.

of New Accounting Pronouncement

discussed in Note 1 to the financial statements, the Company has changed its method of accounting for revenue recognition in 2019

due to the adoption of Accounting Standards Codification 606.

September 30, 2020 and 2019, and the results of its operations and its cash flows for the years then ended, in conformity with

accounting principles generally accepted in the United States of America.

financial statements are the responsibility of the Company’s management.

6 unchanged sentences

and the PCAOB.

conducted our audit in accordance with the standards of the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit

1 unchanged sentence

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial

As part of our audit we are required to obtain an understanding of internal control over financial reporting but not

As part of our audits we are required to obtain an understanding of internal control over financial reporting 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.

audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to

audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to

error or fraud, and performing procedures that respond to those risks.

1 unchanged sentence

regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles

Our audits also included evaluating the accounting principles

used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ Mac Accounting Group, LLP

served as the Company's auditor since 2019.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders’

and Board of Directors of

Learning Corporation

the Financial Statements

We have audited

the accompanying consolidated balance sheet of Creative Learning Corporation (the “Company”) as of September 30, 2018,

the related consolidated statements of operations, changes in stockholders’

equity and cash flows for the year ended September

30, 2018, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial

statements present fairly, in all material respects, the financial position of the Company as of September 30, 2018, and the results

of its operations and its cash flows for the year ended September 30, 2018, in conformity with accounting principles generally

accepted in the United States of America.

Explanatory Paragraph –

Going Concern

The accompanying

financial statements have been prepared assuming that the Company will continue as a going concern.

As more fully described in

Note 2, the Company has a significant working capital deficiency, has incurred significant losses and is reliant on its ability

to raise additional funds to meet its obligations and sustain its operations.

These conditions raise substantial doubt about the

Company's ability to continue as a going concern.

Management's plans in regard to these matters are also described in Note 2.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial

statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company's financial

statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United

States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S.

securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial reporting 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.

Our audit included

performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud,

and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and

significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

that our audit provides a reasonable basis for our opinion.

We have served as the Company’s

auditor from 2018 to 2019.

West Palm Beach, FL

September 4, 2019

We believe that our audits provide a reasonable basis for our opinion.

Mac Accounting Group, LLP

have served as the Company's auditor since 2019.

LEARNING CORPORATION

Balance Sheets

Current Assets:

Cash (marketing fund)

receivable, less allowance for doubtful

of approximately $663,000 and $938,000, respectively

commission expense

held for sale

receivables - current portion, less allowance for doubtful

of approximately $91,000 and $91,000, respectively

September 30,

Current Assets:

commission expense- net of current portion

receivables - net of current portion

and equipment, net of accumulated depreciation

approximately $383,000 and $273,000, respectively

and Stockholders' Equity ( Deficit)

Current Liabilities:

Restricted Cash (marketing fund)

Accounts receivable, less allowance for doubtful accounts of approximately $942,000 and $663,000, respectively

Prepaid commission expense

Prepaid expense

Marketing Fund

Notes receivables - current portion, less allowance for doubtful accounts of approximately $91,000 and $91,000, respectively

Total Current Assets

Prepaid commission expense- net of current portion

Notes receivables - net of current portion

Property and equipment, net of accumulated depreciation of approximately $416,000 and $383,000, respectively

Liabilities and Stockholders' Equity

Current Liabilities:

revenue - net of current portion

Commitments and Contingencies

Stockholders' Equity

stock, $.0001 par value;

Accounts payable

Notes payable

Deferred revenue

Accrued liabilities

Accrued marketing fund

Total Current Liabilities

Deferred revenue - net of current portion

Total Liabilities

Commitments and Contingencies (Note 10)

Stockholders' Equity (Deficit)

Preferred stock, $.0001 par value;

10,000,000 shares authorized;

-0- shares issued and outstanding

stock, $.0001 par value;

50,000,000 shares authorized

13,607,102 shares

issued and 13,542,002 shares outstanding as of September 30, 2019

12,075,875 shares

issued and 12,010,775 shares outstanding as of September 30, 2018

paid in capital

Stock 65,100 shares, at cost

Stockholders' Equity (Deficit)

Liabilities and Stockholders' Equity (Deficit)

Common stock, $.0001 par value;

50,000,000 shares authorized 13,363,410 shares issued and 13,298,310 shares outstanding as of September 30, 2020;

13,607,102 shares issued and 13,542,002 shares outstanding as of September 30, 2019

Additional paid in capital

Treasury Stock 65,100 shares, at cost

Accumulated Deficit

Total Stockholders' Equity (Deficit)

Total Liabilities and Stockholders' Equity (Deficit)

accompanying notes are an integral part of the consolidated financial statements.

CREATIVE LEARNING CORPORATION

Consolidated Statements of Operations

the Fiscal Years Ended September 30,

LEARNING CORPORATION

Statements of Operations

September 30,

Royalties fees

3 unchanged sentences

Merchandise sales

TOTAL REVENUES

COST OF GOODS SOLD

8 unchanged sentences

Franchisee marketing fund expense

Impairment expense

Office expense

OPERATING EXPENSES

TOTAL OPERATING EXPENSES

OPERATING INCOME (LOSS)

4 unchanged sentences

NET INCOME (LOSS) PER SHARE

Basic and diluted weighted average number

Basic weighted average number of common shares outstanding

Diluted weighted average number of common shares outstanding

accompanying notes are an integral part of the consolidated financial statements.

2 unchanged sentences

Stockholder's

Equity(Deficit)

October 1, 2017

Treasury Stock

Balance October 1, 2018

$ (2,391,525 )

Stock-based compensation

September 30, 2018

Stock based compensation

Adoption of ASC 606

September 30, 2019

Balance September 30, 2019

Stock based compensation

Shares cancelled

Balance, September 30, 2020

$ (4,773,713 )

$ (1,816,925 )

The accompanying

notes are an integral part of the consolidated financial statements.

accompanying notes are an integral part of the consolidated financial statements.

LEARNING CORPORATION

1 unchanged sentence

For the Fiscal Years ended

September 30,

Cash flows from operating activities:

Net Income/(Loss)

Adjustments to reconcile net loss to net cash provided by/(used in) operating

Adjustments to reconcile net loss to net cash provided by/(used in) operating activities:

Gain on sale of assets held for sale

1 unchanged sentence

Stock based compensation

Impairment loss on intangible assets

Changes in operating assets and liabilities:

9 unchanged sentences

Acquisition of property and equipment

Sale of assets held for sale

Proceeds from the sale of assets

(Issuance)/Collection of Notes receivable

Net cash provided by (used in) investing activities

Net cash provided by investing activities

Cash flows from financing activities:

Net cash provided by (used in) financing activities

Proceeds from notes payable

Net cash provided by financing activities

Net change in cash, cash equivalents and restricted cash

2 unchanged sentences

Noncash financing activity:

Financed Insurance

Shares cancelled

Noncash activity related to FASB ASC 606:

The accompanying

notes are an integral part of the consolidated financial statements.

CREATIVE LEARNING

Notes to Consolidated

Financial Statements

Supplemental cash flow information:

Cash paid for interest

Cash paid for income taxes

accompanying notes are an integral part of the consolidated financial statements.

LEARNING CORPORATION

to Consolidated Financial Statements

30, 2020 and 2019

7 unchanged sentences

Learning Corporation.

During fiscal year 2020, BFK eLearning LLC was formed in the State of Delaware.

addition to the accounts of CLC and BFK, the accompanying consolidated financial statements include the accounts of CLC’s

subsidiaries, BFK Development Company LLC (“BFKD”), and SF LLC (“Sew Fun Studios”).

organizational documents for BFK Development Company LLC and SF LLC do not specify a termination date.

Each of the above listed

LLC’s has a single member, controlled 100% by CLC.

subsidiaries, BFK Development Company LLC (“BFKD”), BFK eLearning LLC (“B4KEL”) and SF LLC (“Sew

Fun Studios”).

In 2020, the Company decided to put on hold the Sew Fun Studios business.

organizational documents for BFK Development Company LLC, B4KEL and SF LLC do not specify a termination date.

Each of the above

listed LLC’s has a single member, controlled 100% by CLC.

The Company also owns a 49% non-controlling interest in Bricks4Schoolz,

LLC, which is accounted for under the cost method (subject to the Company’s rescission of its interest).

operates wholly-owned subsidiaries BFK and SF under the trade names Bricks 4 Kidz®

2 unchanged sentences

offer children's enrichment and education franchises.

and its wholly owned subsidiaries BFK, BFKD, and SF LLC are hereinafter referred to collectively as the "Company".

and its wholly owned subsidiaries BFK, BFKD, B4KEL, and SF LLC are hereinafter referred to collectively as the "Company".

of Presentation

6 unchanged sentences

The royalty structure is the same for both our US and International franchisees.

Contracts are structured as such that the Company collects revenue from foreign franchises in US dollars.

Contracts are structured such that the Company collects revenue from foreign franchises in US dollars.

We do not have international

5 unchanged sentences

of Consolidation

accompanying consolidated financial statements include the accounts of CLC and its wholly-owned subsidiaries.

All intercompany

balances and transactions have been eliminated in consolidation.

The accompanying consolidated

financial statements include the accounts of CLC and its wholly-owned subsidiaries.

All intercompany balances and transactions

have been eliminated in consolidation.

accompanying financial statements do not include the accounts of Bricks4Schoolz, LLC, a 49% owned entity which is accounted for

under the cost method (subject to the Company’s rescission of its interest).

Company operates on a September 30 fiscal year-end.

14 unchanged sentences

recorded as cash, cash equivalents, and restricted cash in the statement of cash flows is as follows:

September 30,

Cash Equivalents

Restricted Cash

Company maintains cash balances which at times exceed the federally insured limit of $250,000.

The Company believes there is no

significant risk with respect to these deposits.

The Company had approximately $241,000 of cash in excess of the federally insured

limit at September 30, 2019 as compared to $0 at September 30, 2018.

The Company maintains

cash balances which at times exceed the federally insured limit of $250,000.

The Company believes there is no significant risk

with respect to these deposits.

The Company had approximately $-0- cash in excess of the federally insured limit at September

30, 2020 as compared to $241,000 at September 30, 2019.

Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records

37 unchanged sentences

independent appraisals, as considered necessary.

fiscal year 2018, the Company recognized an Impairment Loss on long-lived assets relating to concepts and trademarks for SF LLC.

The Company abandoned the revenue stream for Sew Fun Studios, for which the previously recorded intangible assets were intended

to provide future economic value, and therefore determined that the intangible assets were fully impaired as of September 30,

$23,200 was recorded as an impairment loss in the operating expenses on the Consolidated Statements of Operations for the

year ended September 30, 2018.

Equipment and Depreciation

5 unchanged sentences

from the accounts and any gain or loss is recorded in the year of disposal.

and Equipment

Property and Equipment

Furniture and Fixtures

3 unchanged sentences

secondary market.

of Financial Instruments

Value of Financial Instruments

carrying amounts of cash, accounts receivable, and accounts payable approximate fair value because of the relative short-term

14 unchanged sentences

prices in active markets for identical assets or liabilities.

Quoted prices in

active markets for similar assets and liabilities and inputs that are observable for the asset or liability.

Unobservable inputs

in which there is little or no market data, which require the reporting entity to develop its own assumptions.

prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability.

inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant

26 unchanged sentences

The Company elected to apply the new standard retrospectively with an adjustment to the opening balance of

retained earnings, therefore comparative information from prior year periods has not been adjusted and continue to be reported

under the accounting standards in effect for those periods, specifically under ASC 605.

the year ended September 30, 2018, under ASC 605, the Company recognized revenue on an accrual basis after services were performed

under contract terms and in accordance with regulatory requirements, the service price to the client was fixed or determinable,

and collectability was reasonably assured.

Accordingly, initial franchise fees were not recognized as revenue until initial training

was completed and when substantially all of the services required by the franchise agreement were fulfilled by the Company in

accordance with ASC Topic 952-605 Revenue Recognition-Franchisor .

Further, royalties and technology fees were recognized

as earned on a monthly basis.

Lastly, the Company recorded marketing funds collected as a liability on the balance sheet with

expenses pertaining to the marketing fund reducing the liability account, thus no income statement impact.

At September 30, 2018

the Company had no unearned revenue for franchise fees collected but not yet earned per their ASC 605 revenue recognition policy.

October 1, 2018 the Company began recognizing revenue under ASC 606.

The Company considers initial franchise fees to be a part

of the license of symbolic intellectual property (“IP”), therefore the performance obligation related to these fees

is satisfied over time as the Company fulfills its promise to grant the customer rights to use, and benefit from, the Company’s

IP, as well as support and maintain the IP.

The initial franchise fee, then, is recorded as deferred revenue at inception and

recognized on a straight-line basis over the contract term.

retained earnings as of the date of adoption.

Under ASC 606, the Company considers initial franchise fees to be a part of the

license of symbolic intellectual property (“IP”), therefore the performance obligation related to these fees is satisfied

over time as the Company fulfills its promise to grant the customer rights to use, and benefit from, the Company’s IP, as

well as support and maintain the IP.

The initial franchise fee, then, is recorded as deferred revenue at inception and recognized

on a straight-line basis over the contract term.

accordance with ASC 606-10-55-65, the Company has determined that the royalty fees, marketing fees, and technology fees are subject

27 unchanged sentences

During the year ended

September 30, 2019 the activity in the deferred revenue account was as follows:

September 30, 2019 and 2020 the activity in the deferred revenue account was as follows:

Balance, September 30, 2018

3 unchanged sentences

Balance, September 30, 2019

Initial franchise fees collected

Revenue recognized into revenue

Balance, September 30, 2020

Current portion

Deferred revenue, net of current portion

to September 30, 2018 the Company had no activity in its deferred revenue account.

expected to be recognized into revenue related to performance obligations that are unsatisfied (or partially unsatisfied) as of

15 unchanged sentences

the Company presented these marketing fund revenues and expenses on a gross basis on its statement of operations.

Prior to October

1, 2018 the revenues and expenses were presented at a net zero value on the Statement of Operations.

Any unused funds at the end

of the period are recorded as accrued marketing fees.

During the year ended September 30, 2019 the activity in the accrued marketing

fund liability account was as follows:

September 30, 2018

fund billings

recognized into expense

September 30, 2019

Any unused funds

at the end of the period are recorded as accrued marketing fees.

During the year ended September 30, 2019 and 2020 the activity

in the accrued marketing fund liability account was as follows:

Balance, September 30, 2018

Marketing fund billings

Commissions recognized into expense

Balance, September 30, 2019

Marketing fund billings

Commissions recognized into expense

Balance, September 30, 2020

Asset –

Prepaid Commission Expense

In accordance

with ASC 606 the costs related to obtaining a contract are to be capitalized as long as the costs are recoverable and incremental.

Effective October 1, 2019, the date the Company adopted ASC 606, they capitalized the value of sales commissions as a contract

asset and is amortizing those costs straight-line over the contract life of the franchise agreement to which they relate.

the year ended September 30, 2019 the activity in the contract asset account was as follows:

accordance with ASC 606 the costs related to obtaining a contract are to be capitalized as long as the costs are recoverable and

Effective October 1, 2019, the date the Company adopted ASC 606, they capitalized the value of sales commissions

as a contract asset and is amortizing those costs straight-line over the contract life of the franchise agreement to which they

During the year ended September 30, 2019 and 2020 the activity in the contract asset account was as follows:

Balance, September 30, 2018

Prepaid commissions

recognized upon adoption of ASC 606

Prepaid commissions recognized upon adoption of ASC 606

Commissions paid

Commissions recognized

Commissions recognized into expense

Balance, September 30, 2019

Commissions paid

Commissions recognized into expense

Balance, September 30, 2020

Current portion

Prepaid commission

expense, net of current portion

to September 30, 2018 the Company had no activity in its prepaid commission expense account.

General Marketing Costs

Prepaid commission expense, net of current portion

Marketing Costs

marketing costs are expensed as incurred.

61 unchanged sentences

Additional qualitative and quantitative disclosures, including significant

judgments made by management, will be required.

The new standard will become effective for the Company beginning with the first

quarter in the fiscal year ending September 30, 2020 and requires a modified retrospective transition approach and includes a

number of practical expedients.

Early adoption of the standard is permitted.

The Company is currently evaluating the impact the

adoption of this accounting guidance will have on the consolidated financial statements.

judgments made by management, are required.

The new standard was adopted by the Company in fiscal year 2020 but had no impact

on the Company’s financial statements as the Company does not have any leases that meet the criteria under this standard.

other newly issued accounting pronouncements, but not yet effective, have been deemed either immaterial or not applicable.

(2) Liquidity

Company’s consolidated financial statements for the year ended September 30, 2018 were prepared on the basis that the Company

would continue as a going concern, which accordingly assumes, among other things, the realization of assets and the satisfaction

of liabilities in the ordinary course of business.

The Company had losses of $218,833, had negative cash flows from operating

activities and had incurred accumulated losses of $2,391,525 as of September 30, 2018.

These conditions raised substantial

doubt about the Company’s ability to continue as a going concern.

of September 30, 2019, the Company had net income of approximately $2,000,000, cash provided by operating activities of approximately

$400,000 and sufficient cash to cover projected expenses for the next twelve months.

During the year ended September 30,

2019, the Company began using newly developed software to improve communications and revenue reporting capabilities from its franchisees.

This new development has allowed for more accurate billing and collections of royalty fees and marketing fees.

The Company intends

to continue using this new software and expects to continue to see consistent amounts of royalty fee and marketing fee revenues

in the next 12 months and beyond.

These positive conditions and events have led management to determine that the substantial doubt

about the Company’s ability to continue as a going concern has been alleviated.

Party Transactions

the current year, the Company had net income of approximately $620,000 and has sufficient cash on hand to cover expenses for the

next 12 months.

recent COVID-19 outbreak has been declared a pandemic by the World Health Organization, has spread to the United States and many

other parts of the world and has adversely affected our business operations, employee availability, financial condition, liquidity

and cash flow and the length of such impacts are uncertain.

outbreak of COVID-19 continues to grow both in the United States and globally, and related government and private sector responsive

actions have and will continue to adversely affect our business operations.

It is impossible to predict the effect and ultimate

impact of the COVID-19 pandemic as the situation is rapidly evolving.

spread of COVID-19 has caused public health officials to recommend precautions to mitigate the spread of the virus, including

warning against congregating in heavily populated areas, such as malls and shopping centers.

Among the precautions has been the

closure of a substantial portion of the schools in the United States, which has adversely impacted our royalty revenue from franchisees

and our ability to sell new franchises.

There is significant uncertainty around the breadth and duration of these school closures

and other business disruptions related to COVID-19, as well as its impact on the U.S.

and global economy.

The extent to which

COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including

new information that may emerge concerning the severity of COVID-19 and the actions taken to contain it or treat its impact.

have asked our corporate employees whose jobs allow them to work remotely to do so for the foreseeable future.

Such precautionary

measures could create operational challenges, as we adjust to a remote workforce, which could adversely impact our bustiness.

had cash flows used in operating activities of approximately $306,000 for the year ended September 30, 2020 compared to cash flows

provided by operating activities of approximately $398,000 for the year ended September 30, 2019.

The decrease in cash flows provided

by operating activities for the year ended September 30, 2020 compared to the year ended September 30, 2019 relates primarily

to lower franchise and royalty revenues.

had cash flows provided by investing activities of approximately $94,000 for the year ended September 30, 2020 compared to cash

flows provided by investing activities of approximately $39,000 for the year ended September 30, 2019.

The increase in cash flows

provided investing activities was primarily due to acquiring no property and equipment during the year ended September 30, 2020

compared to acquiring approximately $119,000 during the year ended September 30, 2019.

had cash flows provided by financing activities of approximately $120,000 for the year ended September 30, 2020, compared to $0

for the year ended September 30, 2019.

This was due to the Company receiving proceeds from a loan from the Small Business Administration

as further described in Note 10.

Company is dependent upon both franchise sales and royalty fees to continue current business operations and liquidity.

Related Party Transactions

December 2017, the Company granted a total of 14,286 warrants to two Directors of the Company.

10 unchanged sentences

common stock.

The Company agreed to waive the $2,000 exercise price owed in total from these warrant holders, therefore this exercise

was done on a cashless basis.

The Company agreed to waive the $2,000 exercise price owed in total from these warrant holders.

September 30, 2019, Blake Furlow resigned as Chief Executive Officer of the Company.

Furlow was entitled to receive a severance

payment of $30,000 pursuant to the terms of a Severance Agreement.

In connection with the obligations of his former employment

agreement, the Company issued an aggregate of 566,176 shares of Common Stock to Mr.

Mitchell entered into

an Employment Agreement with the Company as of October 1, 2019 for the term of one year.

In addition to cash compensation, he will

receive stock grants valued at lesser of $15,000 or 200,000 Shares of Common Stock on the last day of the completed year of employment.

Mitchell continued to serve as a member of the Board of Directors of the Company, but no longer served as the Company’s

Chief Financial Officer.

On September 30, 2019, the Company approved the issuance of 166,667 shares to Mr.

Mitchell pursuant to

his employment agreement for compensation earned during the year ended September 30, 2019.

September 27, 2019, in connection with their service on the Board of Directors for fiscal years 2017, 2018 and 2019, the Company

approved the issuance of (i) 99,362, (ii) 272,472, (iii) 112,739 and (iv) 272,472 shares of Common Stock to Blake Furlow, Gary

Herman, Bart Mitchell and JoyAnn Kenny-Charlton, respectively as well as a total of cash payments of $85,041.

Furlow received a severance payment of

$30,000 pursuant to the terms of a Severance Agreement.

Pursuant to his employment agreement, the Company also issued an aggregate

of 566,176 shares of Common Stock to Mr.

Effective September

30, 2019, Bart Mitchell, the Company’s Chief Financial Officer, was appointed Chief Executive Officer of the Company.

connection with his appointment, Mr.

Mitchell entered into an Employment Agreement with the Company as of October 1, 2019 for

the term of one year.

In addition to cash compensation, he was entitled to receive stock grants valued at the lesser of $15,000

or 200,000 Shares of Common Stock on the last day of the completed year of employment.

Mitchell continued to serve as a member

of the Board of Directors of the Company, but no longer served as the Company’s Chief Financial Officer.

On September 30,

2019, the Company approved the issuance of 166,667 shares to Mr.

Mitchell pursuant to his prior employment agreement for compensation

earned during the year ended September 30, 2019.

Mitchell resigned as President on June 8, 2020.

At such time he received

a severance package of $50,000.

During fiscal year 2020, Mr.

Mitchell no longer wanted his 279,406 shares and returned them to

the Company for no consideration and then the Company cancelled them.

On September 27, 2019,

in connection with their service on the Board of Directors for fiscal years 2017, 2018 and 2019, the Company approved the issuance

of (i) 99,362, (ii) 272,472, (iii) 112,739 and (iv) 272,472 shares of Common Stock to Blake Furlow, Gary Herman, Bart Mitchell

and JoyAnn Kenny-Charlton, respectively as well as a total of cash payments of $85,041.

Christopher Rego has

been a director since February 5, 2020, and our Chief Executive Officer since May 1, 2020.

Prior to his appointment, Mr.

Rego purchased

an active franchise in California.

During the year ended September 30, 2020 the Company recognized royalty revenue from the franchise

of $16,650 and recognized marketing fee revenue from the franchise of $829.

Total payments made by the franchisee were $7,681.

As of September 30, 2020 and 2019 the accounts receivable balance with the franchise was $11,894 and $21,536, respectively and

the franchises had deferred revenue balances of $0.

John Simento has been

a director of the Company since May 19, 2020.

Rego’s and Mr.

Simento’s appointments with the Company,

they purchased a Company franchise in the United Arab Emirates (the “UAE”).

The Company filed an arbitration complaint

against them in December 2019 regarding issues related to opening the franchise.

The complaint was resolved by a Settlement Agreement

dated February 5, 2020.

Under the Settlement Agreement, the Company forgave all back royalty fees through July 2019, equally $18,825,

and agreed to defer all other fees until the franchise was able to obtain a business license to operate in the U.A.E., which is

currently delayed due to the Coronavirus pandemic.

The franchise is currently non-operational as a result of an inability to obtain

the issuance of a business license form the UAE due to the Coronavirus pandemic.

If the franchise is not able to procure the necessary

authorizations to operate, the franchisees would not owe any franchise fees.

As a consequence, we have not realized any revenue

from the franchise.

Rego is also the CEO of Teknowland, a software development company, with which the Company entered into an agreement on March

The term of the agreement is nine months and calls for a development fee of $12,900 per month.

During the year ended

September 30, 2020 the Company paid seven monthly payments of $12,900 in accordance with the terms of the agreement and paid an

additional $15,700 for additional services, for a total of $106,000.

or about December 6, 2019, Christopher Rego and Rod Whiton (the “Solicitors”), prior to their appointments as officers

or directors of the Company, commenced a consent solicitation to the shareholders of the Company and on February 5, 2020,

the Company and the Solicitors entered into an agreement to settle their dispute over the consent solicitation.

The settlement

resulted in the Company paying $10,000 as reimbursement for certain costs that they incurred related to the consent solicitation,

the Company agreeing to appoint Mr.

Whiton to the board, and the Company’s agreeing to appoint Mr.

Rego as chief

executive officer, among other provisions.

The Company ultimately paid a total of $20,000 in costs incurred by Messrs.

Whiton in relation to the consent solicitation.

Property and Equipment

and equipment consisted of the following:

Depreciable Property

and Equipment:

September 30,

Depreciable Property and Equipment:

Furniture and Fixtures

Property and Improvements

Total Depreciable Property

and Equipment

Total Depreciable Property and Equipment

Accumulated Depreciation

Total Net Depreciable

Property and Equipment

Non-depreciable Property

and Equipment:

Work in progress

Total Net Property and

Total Net Property and Equipment

to the end of fiscal 2018, the Company listed one of its owned condominiums for sale located at 701 Market Street, Suite 113,

7 unchanged sentences

a gain of approximately $22,000 which represented the excess of the proceeds over the carrying value on that date.

the year ended September 30, 2018, the Company began the development of a software program to communicate with franchisees and

track gross receipts.

At September 30, 2018, the amount of work in progress related to this software was $186,826.

The development

of this software was completed in December 2018 and it was placed into service.

The balance of the work in progress was classified

as software and began being amortized on the date the software was placed into service.

October 30, 2019, the Company completed the sale of a condominium conference space for proceeds of approximately $100,000 and

recorded a gain of approximately $21,000, which represented the excess of the proceeds over the carrying value on that date.

expense totaled approximately $113,000 and $116,000, respectively, for the years ended September 30, 2020 and 2019.

8 unchanged sentences

notes with monthly payments, payable within one to two years.

schedules for Notes Receivable

Payment schedules for Notes Receivable

Accrued Liabilities

The Company had

accrued liabilities at September 30, 2019, and September 30, 2018 as follows:

Company had accrued liabilities at September 30, 2020, and September 30, 2019 as follows:

Accrued Liabilities

1 unchanged sentence

September 30,

Accrued Board

Accrued Compensation

and payroll taxes

Accrued Board Compensation

Accrued Compensation and payroll taxes

Accrued Severance

Stock-Based Compensation

December 2017, the Company granted an aggregate of 14,286 warrants to two Directors of the Company in connection with standby

letters of credit.

(See Note 3).

The Company utilized the Black-Scholes valuation model for estimating fair value of the warrants.

Each grant was evaluated based upon assumptions at the time of the grant.

The assumptions used in our calculations are no dividend

yield, expected volatility of approximately 247%, a risk-free interest rate of 1.76%, and an expected term of 5 years.

yield of zero is based on the fact that the Company does not pay cash dividends and has no present intention to pay cash dividends.

Expected volatility is estimated based on the Company’s historical stock prices over a period equivalent to the expected

life in years.

The risk-free interest rate is based on the U.S.

Treasury’s Daily Treasury Yield Curve Rates at the date

of grant with a term consistent with the expected life of the options granted.

The expected term calculation is based on the “simplified

method”

allowed by the Securities and Exchange Commission (the “SEC”), due to no applicable historical exercise

data available.

These warrants were fully exercised during the year ended September 30, 2019 and 14,286 common shares were issued

(see Note 3).

December 2017, the Company granted a total of 14,286 warrants to two Directors of the Company.

These warrants were granted in

conjunction with the issuance of standby letters of credit from the two directors.

The warrants had an exercise price of $0.14

per share and expired five years from the date of grant.

These warrants were valued using the Black Scholes method.

The fair value

of the warrants on the date of grant were $2,000, and the warrants vested immediately.

The Company expensed $2,000 in connection

with the grant during the year ended September 30, 2018.

These warrants were exercised in September 2019 for 14,286 shares of

common stock.

The Company agreed to waive the $2,000 exercise price owed in total from these warrant holders.

March 27, 2019 and July 19, 2019, the Company approved the issuance of 13,265 and 13,788 shares of common stock, respectively,

22 unchanged sentences

compensation was recorded for these new stock options.

September 27, 2019, the Company approved the issuance of shares of common stock consistent with its corporate by-laws to each

of the members of the Company’s Board Members for board compensation, as follows:

Blake Furlow –

99,362 shares, Gary

Herman –

272,472 shares, Bart Mitchell –

112,739 shares and JoyAnn Kenny-Charlton, 272,472 shares.

These shares were

recorded at an aggregate fair value of $45,423 at September 27, 2019 based on the common share price of recent stock issuances.

September 27, 2019, the Company issued 566,176 shares of common stock to its former CEO for compensation earned during the year

as per his employment agreement.

The shares were valued based on the common share price of recent stock issuances for a total

amount of $35,000.

September 27, 2019, the Company approved the issuance of 166,667 shares of common stock to its former CFO for compensation earned

during the year as per his employment agreement.

The shares were valued based on the common share price of recent stock issuances

for a total amount of $10,000.

September 30, 2019, Blake Furlow resigned as Chief Executive Officer of the Company.

Furlow received a severance payment of

$30,000 pursuant to the terms of a Severance Agreement.

Pursuant to his employment agreement, the Company also issued an aggregate

of 566,176 shares of Common Stock to Mr.

Furlow valued at $35,000.

September 30, 2019, Bart Mitchell, the Company’s Chief Financial Officer, was appointed Chief Executive Officer of the Company.

In connection with his appointment, Mr.

Mitchell entered into an Employment Agreement with the Company as of October 1, 2019 for

the term of one year.

In addition to cash compensation, he was entitled to receive stock grants valued at the lesser of $15,000

or 200,000 Shares of Common Stock on the last day of the completed year of employment.

Mitchell continued to serve as a member

of the Board of Directors of the Company, but no longer served as the Company’s Chief Financial Officer.

On September 30,

2019, the Company approved the issuance of 166,667 shares to Mr.

Mitchell pursuant to his prior employment agreement for compensation

earned during the year ended September 30, 2019, which were valued at $10,000.

Mitchell resigned as President on June 8, 2020.

At such time he received a severance package of $50,000.

September 27, 2019, in connection with their service on the Board of Directors for fiscal years 2017, 2018 and 2019, the Company

approved the issuance of (i) 99,362, (ii) 272,472, (iii) 112,739 and (iv) 272,472 shares of Common Stock to Blake Furlow, Gary

Herman, Bart Mitchell and JoyAnn Kenny-Charlton, respectively, for a value of $45,423, as well as a total of cash payments of

following table represents option activity during the years ended September 30, 2020 and 2019:

Remaining Life

Exercise Price

Vested and Exercisable at September 30, 2018

Cancelled options

Vested and Exercisable

at September 30, 2018

Cancelled options

Options granted March 21, 2019

Vested and Exercisable

at September 30, 2019

Vested and Exercisable at September 30, 2019

Cancelled options

Options granted

Vested and Exercisable at September 30, 2020

following table represents all outstanding options as of September 30, 2020:

2 unchanged sentences

Granted March 21, 2019

Vested and Exercisable

at September 30, 2018

(8) Commitments

and Contingencies

Vested and Exercisable at September 30, 2019

Commitments and Contingencies

Company is subject to litigation claims arising in the ordinary course of business.

18 unchanged sentences

alleging the Company is required to indemnify him for a multitude of matters.

The Company denies the allegation and is actively

litigating this matter.

On October 8, 2020 the Court dismissed Brian Pappas’

indemnity counterclaim without prejudice.

a separate suit, filed on March 7, 2016 in the state court in St.

1 unchanged sentence

CA 16-236), Franventures,

LLC (“FV”) alleged that it is due an unstated amount of money from the Company pursuant to a contract the Company

had previously terminated.

On June 23, 2016, the Company filed a counterclaim against Franventures, which also included a complaint

against former Chairman of the Board and Chief Executive Officer Brian Pappas.

The counterclaim seeks redress for losses and expenditures

caused by alleged fraud, conversion of company assets, and breaches of fiduciary duty that the Company alleges that defendants

perpetrated upon CLC, including assertions regarding actions by Brian Pappas that the Company alleges occurred while Mr.

was serving as the Chief Executive Officer of CLC and as a member of its board of directors.

The Company is actively litigating

October 27, 2016, Brian Pappas filed a motion to amend the complaint in CA 15-1076 to add a claim alleging that the Company slandered

him by virtue of a press release issued on or about August 1, 2016, in which the Company reported to shareholders on steps it

had taken and improvements it had implemented.

The motion has still not been ruled upon by the Court.

Pappas does amend

his complaint, the Company will vigorously defend the proposed claim.

LLC (“FV”) filed suit against the Company alleging that it is due an unstated amount of money from the Company pursuant

to a contract the Company had previously terminated.

On June 23, 2016, the Company filed a counterclaim against Franventures,

which also included a complaint against former Chairman of the Board and Chief Executive Officer Brian Pappas.

The counterclaim

seeks redress for losses and expenditures caused by alleged fraud, conversion of company assets, and breaches of fiduciary duty

that the Company alleges that defendants perpetrated upon CLC, including assertions regarding actions by Brian Pappas that the

Company alleges occurred while Mr.

Pappas was serving as the Chief Executive Officer of CLC and as a member of its board of directors.

The Company is actively litigating this matter.

On October 27, 2016, Brian Pappas filed a motion to amend the complaint in Case

CA 16-236 to add a claim alleging that the Company slandered him by virtue of a press release issued on or about August 1,

2016, in which the Company reported to shareholders on steps it had taken and improvements it had implemented.

The motion has

still not been ruled upon by the Court.

Pappas is granted the right to amend his complaint and does so, the Company will

vigorously defend the proposed claim.

Company’s complaint against Mr.

Pappas and Franventures (Case No.

CA 15-1076) has been consolidated with Mr.

Pappas’

and Franventures’

complaint against the Company (Case No.

CA 16-236) for purposes of discovery, but not for any other purpose.

February 24, 2017, franchisee, Team Kasa, LLC, along with its three owners, filed suit in the Eastern District of New York (Case

2:17-cv-01074) against former CEO Brian Pappas, and Franventures.

The same Plaintiffs also initiated arbitration on the same

issues (American Arbitration Association, Case No.

01-17-0001-1968), alleging the Company is jointly and severally liable for

damages resulting from the allegations against Mr.

2:17-cv-01074) against former CEO Brian Pappas and Franventures, as well as four other defendants seeking damages under the

New York Franchise Sales Act.

The same Plaintiffs also initiated an arbitration proceeding against the Company on the same issues

(American Arbitration Association, Case No.

01-17-0001-1968), alleging the Company is jointly and severally liable for damages

resulting from the allegations against Mr.

Pappas and Franventures.

The Company is contesting the allegations and its

liability for any damages.

This case has been held in abeyance as the parties seek a resolution.

The Company is contesting the allegations and its liability

for any damages in the arbitration case.

Both cases have been held in abeyance as the parties seek a resolution.

November 8, 2017, franchisee, Indy Bricks, LLC, along with its two owners, Ben and Kate Schreiber, initiated arbitration against

(American Arbitration Association, Case No.

the Company (American Arbitration Association, Case No.

01-17-0006-8120).

Plaintiffs allege breach of contract, fraud, material

The Plaintiffs allege breach of contract, fraud, material

misrepresentations and omissions, violations of the Indiana Franchise Act, and violations of the Indiana Deceptive Franchise Practices

The Company is vigorously contesting the allegations and its liability for any damages.

On April 23, 2020, a settlement agreement was entered into between the Plaintiffs and the Company under which the arbitration

was dismissed.

Pursuant to the settlement agreement, Indy Bricks, LLC will pay the Company an agreed amount of past due franchise

fees, monthly marketing and royalty fees, and monthly fees to utilize the Company’s franchise management software.

December 6, 2019, the Company initiated arbitration against two franchise owners.

This case was settled on February 5, 2020.

July 2019, the Company entered into an operating agreement for a joint venture known as Bricks4Schoolz, LLC, with BPL Enterprises

for Bricks4Schoolz LLC (“BPL”).

Under the operating

agreement, the joint venture is granted a license to distribute certain intellectual property of the Company through a software

system developed by BPL for the joint venture, provided that the joint venture may only distribute the intellectual property to

elementary and middle schools in territories which are not covered by an existing franchisee of the Company.

Due to disputes regarding

the scope of the license, and the fact that neither Bricks4Schoolz, LLC or BPL were legal entities at the time the operating agreement

was executed, the Company has rescinded the operating agreement.

components of the deferred tax assets at September 30, 2020 and September 30, 2019 were as follows:

Deferred tax assets:

Allowance for bad debt

Charitable contributions

2 unchanged sentences

Net operating loss

Total gross deferred tax

Total gross deferred tax asset

Deferred tax liabilities:

2 unchanged sentences

Total deferred tax liability

Gross net deferred tax

Gross net deferred tax asset

Valuation allowances

Net deferred tax asset

Company has recorded various deferred tax assets and liabilities as reflected above.

In assessing the ability to realize the deferred

tax assets, management considers, whether it is more likely than not, that some portion, or all of the deferred tax assets and

liabilities will be realized.

The Company has recorded

various deferred tax assets and liabilities as reflected above.

In assessing the ability to realize the deferred tax assets, management

considers, whether it is more likely than not, that some portion, or all of the deferred tax assets and liabilities will be realized.

The ultimate realization is dependent on generating sufficient taxable income in future years.

valuation allowance is equal to 100% of the Net deferred tax asset.

Given recurring losses, the Company cannot conclude that it

is more likely than not that such assets will be realized, therefore a full valuation allowance has been recorded.

The components

of the provisions for income taxes for the fiscal years ended September 30, 2019 and 2018 are as follows:

Additional deferred

tax related to book tax differences

The valuation allowance is equal

to 100% of the net deferred tax asset.

Given recurring losses, the Company cannot conclude that it is more likely than not that

such assets will be realized, therefore a full valuation allowance has been recorded.

components of the provisions for income taxes for the fiscal years ended September 30, 2020 and 2019 are as follows:

Additional deferred tax related to book tax differences

Valuation allowance

Tax Provision

A reconciliation

of the provisions for income taxes for the fiscal years ended September 2019 and 2018 as compared to statutory rates is as follows:

Total tax provision

reconciliation of the provisions for income taxes for the fiscal years ended September 2020 and 2019 as compared to statutory

rates is as follows:

Provision at statutory rates

6 unchanged sentences

Total income tax provision

(10) Subsequent Events

Company evaluates subsequent events that occur after the balance sheet date through the financial statements were issued.

following are subsequent events requiring disclosure:

Mitchell entered into an Employment Agreement with the Company as of October 1, 2019.

The employment agreement provided for a

one year term, annual cash compensation of $150,000 and entitled Mr.

Mitchell to receive stock grants valued at lesser of $15,000

or 200,000 Shares of Common Stock.

Effective October 1, 2019, Mr.

Mitchell was continuing to serve as a member of the Board of

Directors of the Company, but was no longer serving as the Company’s Chief Financial Officer.

October 1, 2019, Robert Boyd was appointed Chief Accounting Officer of the Company.

Boyd and the Company entered into a one

year employment agreement which provides that Mr.

Boyd’s compensation will be $40,000 per annum.

October 30, 2019 the Company completed the sale of a condominium conference space for proceeds of approximately $99,000.

October 2019 the Company signed a 21 month lease for office space at 5995 W State Street Suite B, Garden City, ID 83703.

lease amount is $833.

January 13, 2020, 35,714 shares of common stock were approved to be issued to each Gary Herman and to JoyAnn Kenny-Charlton for

first quarter 2020 board compensation.

February 5, 2020, the Company entered into an agreement with Christopher Rego and Rod Whiton, pursuant to which Bart Mitchell

resigned from the Company’s board of directors, and Christopher Rego and Rod Whiton were appointed to the Company’s

board of directors.

In connection with Mr.

Rego’s appointment, he was also named chief executive officer of BFK Franchise

Company, LLC (“BFK”), a subsidiary of the Company, and will become chief executive officer of the Company at the earlier

of March 31, 2020 or when the Company files its Form 10-K for the year ended September 30, 2019 and its Form 10-Q for the period

ended December 31, 2019.

Rego’s appointment as chief executive officer, Mr.

Mitchell will become the president

of the Company.

The Company and Mr.

Rego have not determined his compensation for serving as an officer of BFK Franchise Company,

LLC or the Company.

January 30, 2020, the World Health Organization declared the coronavirus outbreak a "Public Health Emergency of International

Concern"

and on March 10, 2020, declared it to be a pandemic.

Actions taken around the world to help mitigate the spread

of the coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of

public places and businesses.

The coronavirus and actions taken to mitigate it have had and are expected to continue to have an

adverse impact on the economies and financial markets of many countries, including the geographical areas in which the Company

While it is unknown how long these conditions will last and what the complete financial effect will be to the company,

to date, the Company is experiencing declining royalty fee revenue from some of its franchisees whose revenues have been decreasing

due to school closures and rules about social distancing.

Additionally,

it is reasonably possible that estimates made in the financial statements have been, or will be, materially and adversely impacted

in the near term as a result of these conditions, including expected collections on receivables.

April 28, 2020, the Company was granted a loan (the “Loan”) from First Bank of the Lake in aggregate amount of $119,980,

pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted

March 27, 2020.

The Loan, which was in the form of a Note dated April 24, 2020 issued by the Company, matures on April 23, 2022

and bears interest at a rate of 1% per annum, payable monthly commencing on October 23, 2020.

The Note may be prepaid by the Borrower

at any time prior to maturity with no prepayment penalties.

Funds from the Loan may only be used for payroll costs, cost used

to continue group health care benefits, mortgage payments, rent, utilities and interest on other debt obligations incurred before

February 15, 2020.

The Company used the entire Loan amount for qualifying expenses.

Under the terms of the PPP, certain amounts

of the Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act.

(11) Subsequent

Company performed a review of events subsequent to the balance sheet date through the date the financial statements were issued

and determined that there were no such events requiring recognition or disclosure in the financial statements.

to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report

to be signed on its behalf by the undersigned, thereunto duly authorized.

LEARNING CORPORATION

December 30, 2020

Whiton, President

Executive Officer)

December 30, 2020

Elkin, Chief Financial Officer

Financial and Accounting Officer)

to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf

of the registrant and in the capacities and on the date indicated.

Christopher Rego

and Chief Executive Officer

JoyAnn Kenny-Charlton

Kenny-Charlton

Gary Zell, II

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures