0001731122-19-000598.txt : 20191004 0001731122-19-000598.hdr.sgml : 20191004 20191004165534 ACCESSION NUMBER: 0001731122-19-000598 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20190930 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Unregistered Sales of Equity Securities ITEM INFORMATION: Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20191004 DATE AS OF CHANGE: 20191004 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CREATIVE LEARNING Corp CENTRAL INDEX KEY: 0001394638 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EDUCATIONAL SERVICES [8200] IRS NUMBER: 204456503 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-52883 FILM NUMBER: 191139067 BUSINESS ADDRESS: STREET 1: 701 MARKET STREET CITY: ST AUGUSTINE STATE: FL ZIP: 32095 BUSINESS PHONE: 904-824-3133 MAIL ADDRESS: STREET 1: 701 MARKET STREET CITY: ST AUGUSTINE STATE: FL ZIP: 32095 FORMER COMPANY: FORMER CONFORMED NAME: B2 HEALTH, INC. DATE OF NAME CHANGE: 20070327 8-K 1 e1528_8k.htm FORM 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 30, 2019

CREATIVE LEARNING CORPORATION
(Exact name of registrant as specified in its charter)

Delaware	000-52883	20-4456503
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

701 Market Street, Suite 113 St. Augustine, FL		32095
(Address of principal executive offices)		(Zip Code)

(904) 824-3133

Registrant’s telephone number, including area code:

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

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

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

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

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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01

Entry into Material Definitive Agreement.

On September 30, 2019, Creative Learning Corporation. (the “Company”) entered into indemnification agreements with its officers and directors which provide that the Company will provide indemnification to the officers and directors in connection with their service to the Company. The Form of Indemnification Agreement is filed as Exhibit 99.1 hereto.

Item 3.02

Unregistered Sales of Equity Securities.

In connection with his employment as Chief Executive Officer of the Company, Blake Furlow was entitled to receive shares of the Company’s Common Stock, $.0001 par value (the “Common Stock”) valued at $35,000 and Mr. Furlow was also entitled to receive shares of Common Stock upon the exercise of a Warrant granted to Mr. Furlow in consideration of a Letter of Credit he provided to the Company in December 2017. In connection with these obligations the Company as of September 2019 issued an aggregate of 573,176 shares of Common Stock to Mr. Furlow.

In connection with their service on the Board of Directors for the fiscal years ended September 30, 2017, September 30, 2018 and September 30, 2019, the Company issued (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.

The issuances of Common Stock described above were issued pursuant to the exemption contained in Section 4(2) of the Securities Act of 1933, as amended.

Item 5.02

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Effective September 30, 2019, Bart Mitchell, the Company’s Chief Financial Officer, was appointed Chief Executive Officer of the Company. In connection with this appointment, Mr. Mitchell entered into an Employment Agreement with the Company as of October 1, 2019. The employment agreement provides for a one year term. Mr. Mitchell’s annual cash compensation will increase to $150,000 and he will receive stock grants valued at lesser of $15,000 or 200,000 Shares of Common Stock. Mr. Mitchell will continue to serve as a member of the Board of Directors of the Company, but will no longer serve as the Company’s Chief Financial Officer.

Effective October 1, 2019, Robert Boyd was appointed Chief Accounting Officer of the Company. Mr. Boyd and the Company entered into a one year employment agreement which provides that Mr. Boyd’s compensation will be $40,000 per annum.

Biographical Information on Mr. Mitchell and Mr. Boyd

Bart Mitchell, 46, became a director of the Company in July 2017 and has served as the Company’s Chief Financial Officer, since October 2018. Mr. 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. Previously, Mr. Mitchell served as a manager for Xlear Inc., from 2000 until 2002, helping the company through its startup phase and into prosperity. Prior to joining Creative Learning Corporation, he and his wife built Escape Game Coeur d’Alene, which quickly became the most successful escape room business in the region. Mr. Mitchell holds degrees in philosophy from Brigham Young University and English from Dixie State University. Mr. Mitchell’s experience in entrepreneurship, upper management and 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 to Creative Learning Corporation.

Robert Boyd, 63 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. Mr. Boyd has a degree from Brigham Young University in Business & Finance and teaches Quickbooks Certification courses in the Boise, Idaho area.

During the last two years, there have been no transactions or proposed transactions by the Company in which Mr. Mitchell or Mr. Boyd has had or is to have a direct or indirect material interest, and there are no family relationships between Mr. Mitchell or Mr. Boyd and any of the Company’s other executive officers or directors.

As of September 30, 2019 Blake Furlow resigned as Chief Executive Officer of the Company. Mr. Furlow will remain a Director of the Company. Mr. Furlow will receive severance of $30,000 pursuant to the terms of a Severance Agreement which will contain customary terms and conditions. As described under Item 3.02. Unregistered Sales of Equity Securities, Mr. Furlow received 573,176 shares of Common Stock pursuant to preexisting Company obligations.

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

	99.1	Form of Indemnification Agreement for Directors and Officers.

	99.2	Employment Agreement dated October 1, 2019 between the Company and Bart Mitchell.

99.3

Employment Agreement dated October 1, 2019 between the Company and Robert Boyd.

SIGNATURES

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

Dated: October 4, 2019	CREATIVE LEARNING CORPORATION

	By:	/s/ Bart Mitchell
		Name:	Bart Mitchell
		Title:	Chief Executive Officer

EX-99.1 2 e1528_99-1.htm EXHIBIT 99.1

Exhibit 99.1

INDEMNIFICATION AGREEMENT

INDEMNIFICATION AGREEMENT dated as of ___________, 2019 (this “Agreement”), between Creative Learning Corporation, a Delaware corporation (the “Company”), and _________ (“Indemnitee”).

WHEREAS, qualified persons are reluctant to serve corporations as directors or otherwise unless they are provided with appropriate indemnification and liability insurance against claims arising out of their service to and activities on behalf of such corporations; and

WHEREAS, the Board of Directors of the Company (the “Board of Directors”) has determined that attracting and retaining such persons is in the best interests of the Company’s stockholders and that it is reasonable, prudent and necessary for the Company to indemnify such persons to the fullest extent permitted by applicable law and to provide reasonable assurance regarding liability insurance;

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and Indemnitee hereby agree as follows:

Defined Terms; Construction.

(a) Defined Terms. As used in this Agreement, the following terms shall have the following meanings:

“Agent” of the Company means any person who: (i) is or was a director, officer, employee or other fiduciary of the Company or a Subsidiary of the Company; or (ii) is or was serving at the request or for the convenience of, or representing the interests of, the Company or a Subsidiary of the Company, as a director, officer, employee or other fiduciary of a foreign or domestic corporation, partnership, joint venture, trust or other enterprise.

“Change in Control” means, and shall be deemed to have occurred if, on or after the date of this Agreement, (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act (as such term is defined in this Section 1(a)), other than (A) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its subsidiaries acting in such capacity, or (B) a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than 50% of the total voting power represented by the Company’s then outstanding Voting Securities, (ii) during any period of two (2) consecutive years commencing from and after the date hereof, individuals who at the beginning of such period constitute the Board of Directors, together with any new directors whose election by the Board of Directors or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof, (iii) the stockholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation that would result in Voting Securities representing more than 50% of the total combined voting power of the Voting Securities of the surviving entity being immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned the Voting Securities of the Company outstanding immediately prior to such merger or consolidation, (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of (in one transaction or a series of related transactions) all or substantially all of its assets, or (v) the Company shall file or have filed against it, and such filing shall not be dismissed, any bankruptcy, insolvency or dissolution proceedings, or a trustee, administrator or creditors committee shall be appointed to manage or supervise the affairs of the Company.

“Corporate Status” means the status of a person who is or was a director (or a member of any committee of a board of directors), officer, employee or Agent (including, without limitation, a manager of a limited liability company) of the Company or any of its Subsidiaries, or of any predecessor thereof, or is or was serving at the request of the Company as a director (or a member of any committee of a board of directors), officer, employee or Agent (including, without limitation, a manager of a limited liability company) of another entity, or of any predecessor thereof, including service with respect to an employee benefit plan.

“Determination” means a determination that either (i) there is a reasonable basis for the conclusion that indemnification of Indemnitee is proper in the circumstances because Indemnitee met a particular standard of conduct (a “Favorable Determination”) or (ii) there is no reasonable basis for the conclusion that indemnification of Indemnitee is proper in the circumstances because Indemnitee met a particular standard of conduct (an “Adverse Determination”). An Adverse Determination shall include the decision that a Determination was required in connection with indemnification and the decision as to the applicable standard of conduct.

“DGCL” means the General Corporation Law of the State of Delaware, as amended from time to time.

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Expenses” means all attorneys’ fees and expenses, retainers, court, arbitration and mediation costs, transcript costs, fees and expenses of experts, witnesses and public relations consultants, bonds, costs of collecting and producing documents, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types actually and reasonably incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, appealing or otherwise participating in a Proceeding.

“Independent Legal Counsel” means an attorney or firm of attorneys competent to render an opinion under the applicable law, selected in accordance with the provisions of Section 6(e), who has not performed any services (other than services similar to those contemplated to be performed by Independent Legal Counsel under this Agreement) for the Company or any of its Subsidiaries or for Indemnitee within the last three years.

“Proceeding” means a threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, including without limitation a claim, demand, discovery request, formal or informal investigation, inquiry, administrative hearing, arbitration or other form of alternative dispute resolution, including an appeal from any of the foregoing.

“Subsidiary” means any corporation, limited liability company, partnership or other entity, a majority of whose outstanding voting securities is owned, directly or indirectly, by the Company.

“Voting Securities” means any securities of the Company that vote generally in the election of directors.

(b) Construction. For purposes of this Agreement:

(i) References to the “Company” and any of its “Subsidiaries” shall include any corporation, limited liability company, partnership, joint venture, trust or other entity or enterprise that before or after the date of this Agreement is party to a merger or consolidation with the Company or any such Subsidiary or that is a successor to the Company as contemplated by Section 9(e) (whether or not such successor has executed and delivered the written agreement contemplated by Section 9(e)).

(ii) References to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan.

(iii) References to a “Section” or “Sections” shall be deemed to refer to the sections of this Agreement.

(iv) References to a “witness” in connection with a Proceeding shall include any interviewee or person called upon to produce documents in connection with such Proceeding.

2. Agreement to Serve.

(a) Indemnitee agrees to serve, or to continue to serve, as a director of the Company and in such other capacities as Indemnitee may serve at the request of the Company and as agreed to by Indemnitee from time to time (including, without limitation, as a director of one or more of the Company’s Subsidiaries), and by its execution of this Agreement the Company confirms its request that Indemnitee serve as a director of the Company. Indemnitee shall be entitled to resign or otherwise terminate such service with immediate effect at any time, and neither such resignation or termination nor the length of such service shall affect Indemnitee’s rights under this Agreement. This Agreement shall not constitute an employment agreement, supersede any employment agreement to which Indemnitee is a party or create any right of Indemnitee to continued employment or appointment.

(b) The Company acknowledges that it has entered into this Agreement and assumes the obligations imposed on it hereby, in addition to and separate from its obligations to Indemnitee under the Bylaws, to induce Indemnitee to serve, or continue to serve, as a director, officer, employee or Agent of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as a director, officer, employee or Agent of the Company.

3. Indemnification.

(a) General Indemnification. The Company shall indemnify Indemnitee, to the fullest extent permitted by applicable law, for the full term of his appointment, since the date of appointment, including when the Indemnitee was a “De Facto Director”, as an officer and/or director of the Company and thereafter, or as amended to increase the scope of permitted indemnification, against Expenses, losses, liabilities, judgments, fines, penalties and amounts paid in settlement (including all interest, taxes, assessments and other fees and charges in connection therewith) incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding in any way connected with, resulting from or relating to Indemnitee’s Corporate Status.

(b) Additional Indemnification Regarding Expenses. Without limiting the foregoing, in the event any Proceeding is initiated by Indemnitee, the Company, any of its Subsidiaries or any other person to enforce or interpret this Agreement or any rights of Indemnitee to indemnification or advancement of Expenses (or related obligations of Indemnitee) under the Company’s or any such Subsidiary’s Certificate of Incorporation, Bylaws or other organizational agreement or instrument, any other agreement to which Indemnitee and the Company or any of its Subsidiaries are party, any vote of stockholders or directors of the Company or any of its Subsidiaries, the DGCL, any other applicable law or any liability insurance policy, the Company shall indemnify Indemnitee against Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding in proportion to the success achieved by Indemnitee in such Proceeding, as determined by the court presiding over such Proceeding.

(c) Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of any Expenses, losses, liabilities, judgments, fines, penalties and amounts paid in settlement incurred by Indemnitee, but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for such portion.

(d) Nonexclusivity. The indemnification and advancement of expenses rights provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may now or in the future be entitled under the Certificate of Incorporation, Bylaws or other organizational agreement or instrument of the Company or any of its Subsidiaries, any other agreement, any vote of stockholders or directors, the DGCL, any other applicable law or any liability insurance policy.

(e) Exceptions. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated under the Agreement to indemnify Indemnitee:

(i) For Expenses incurred in connection with Proceedings initiated or brought voluntarily by Indemnitee against the Company and not by way of defense, counterclaim or cross-claim, except (A) as contemplated by Section 3(b), (B) in specific cases if the Board of Directors has approved the initiation or bringing of such Proceeding, (C) with respect to Proceedings brought to establish or enforce a right to indemnification under this Agreement or under any other agreement, provision in the Bylaws or Certificate of Incorporation or applicable law, and (D) as may be required by law.

(ii) For an accounting of “short-swing” profits arising from the purchase and sale by the Indemnitee of securities within the meaning of Section 16(b) of the Exchange Act or any similar successor statute.

(f) Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute such documents and do such acts as the Company may reasonably request to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

4. Contribution.

(a) The Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims of contribution which may be brought by officers, directors or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.

(b) To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for all expense, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement), in connection with any Proceeding, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and Agents) and Indemnitee in connection with such event(s) and/or transaction(s).

(c) Any decision in connection with respect to the amount of contribution required under Section 4(b) in connection with any Proceeding shall be made as follows:

(i) if no Change in Control has occurred, (w) by a majority vote of the directors of the Company who are not parties to such Proceeding, even though less than a quorum, with the advice of Independent Legal Counsel, or (x) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, with the advice of Independent Legal Counsel, or (y) if there are no such directors, or if such directors so direct, by Independent Legal Counsel in a written opinion to the Company and Indemnitee, or (z) by the stockholders of the Company; or

(ii) if a Change in Control has occurred, by Independent Legal Counsel in a written opinion to the Company and Indemnitee.

5. Advancement of Expenses. The Company shall pay all Expenses incurred by Indemnitee in connection with any Proceeding in any way connected with, resulting from or relating to Indemnitee’s Corporate Status, other than a Proceeding initiated by Indemnitee for which the Company would not be obligated to indemnify Indemnitee pursuant to Section 3(e)(i), in advance of the final disposition of such Proceeding and without regard to whether Indemnitee will ultimately be entitled to be indemnified for such Expenses and without regard to whether an Adverse Determination has been made, except as contemplated by the last sentence of Section 6(f). Indemnitee shall repay such amounts advanced only if and to the extent that it shall ultimately be determined by a court of competent jurisdiction in a final and non-appealable decision that Indemnitee is not entitled to be indemnified by the Company for such Expenses. Such repayment obligation shall be unsecured and shall not bear interest, and shall be made without regard to Indemnitee’s ability to repay the expenses. The Company shall not impose on Indemnitee additional conditions to advancement or require from Indemnitee additional undertakings regarding repayment. The Company agrees that for the purposes of any advancement of Expenses for which Indemnitee has made written demand to the Company in accordance with this Agreement, all Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable shall be presumed conclusively to be reasonable. The right to advances under this Section 5 shall continue until final disposition of any Proceeding, including any appeal therein.

6. Indemnification Procedures.

(a) Notice of Proceeding; Cooperation. Indemnitee shall give the Company notice in writing as soon as practicable of any Proceeding for which indemnification will or could be sought under this Agreement; provided that any failure or delay in giving such notice shall not relieve the Company of its obligations under this Agreement unless and to the extent that the Company is materially prejudiced by such failure.

(b) Settlement. The Company will not, without the prior written consent of Indemnitee, which may be provided or withheld in Indemnitee’s sole discretion, effect any settlement of any Proceeding against Indemnitee or which could have been brought against Indemnitee unless such settlement solely involves the payment of money by persons other than Indemnitee and includes an unconditional release of Indemnitee from all liability on any matters that are the subject of such Proceeding and an acknowledgment that Indemnitee denies all wrongdoing in connection with such matters.

The Company shall not be obligated to indemnify Indemnitee against amounts paid in settlement of a Proceeding against Indemnitee if such settlement is effected by Indemnitee without the Company’s prior written consent, which consent shall not be unreasonably withheld.

(c) Request for Payment; Timing of Payment. To obtain indemnification payments or advances under this Agreement, Indemnitee shall submit to the Company a written request therefor, together with such invoices or other supporting information as may be reasonably requested by the Company and reasonably available to Indemnitee. The Company shall make indemnification payments to Indemnitee no later than thirty (30) days, and advances to Indemnitee no later than ten (10) days, after receipt of the written request (and such invoices or other supporting information) of Indemnitee.

(d) Determination. The Company intends that Indemnitee shall be indemnified to the fullest extent permitted by law as provided in Section 3 and that no Determination shall be required in connection with such indemnification. In no event shall a Determination be required in connection with advancement of Expenses pursuant to Section 4 or in connection with indemnification for Expenses incurred as a witness or incurred in connection with any Proceeding or portion thereof with respect to which Indemnitee has been successful on the merits or otherwise (including, without limitation, settlement of Proceeding with or without payment of money or other consideration or the termination of any issue or matter in such Proceeding by dismissal, with or without prejudice). Any decision that a Determination is required by law in connection with any other indemnification of Indemnitee, and any such Determination, shall be made within thirty (30) days after receipt of Indemnitee’s written request for indemnification, as follows:

(i) If no Change in Control has occurred, (w) by a majority vote of the directors of the Company who are not parties to such Proceeding, even though less than a quorum, with the advice of Independent Legal Counsel, or (x) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, with the advice of Independent Legal Counsel, or (y) if there are no such directors, or if such directors so direct, by Independent Legal Counsel in a written opinion to the Company and Indemnitee, or (z) by the stockholders of the Company.

(ii) If a Change in Control has occurred, by Independent Legal Counsel in a written opinion to the Company and Indemnitee.

The Company shall pay all Expenses incurred by Indemnitee in connection with a Determination.

(e) Independent Legal Counsel. If there has not been a Change in Control, Independent Legal Counsel shall be selected by the Board of Directors within a reasonable time (and in any event within five (5) Business Days) after receipt of a written request from Indemnitee, and shall be approved by Indemnitee (which approval shall not be unreasonably withheld or delayed). If there has been a Change in Control, Independent Legal Counsel shall be selected by Indemnitee and approved by the Company (which approval shall not be unreasonably withheld) within a reasonable time (and in any event within five (5) Business Days) after receipt of a written notice from Indemnitee specifying Independent Legal Counsel selected by Indemnitee. The Company shall pay the fees and expenses of Independent Legal Counsel and indemnify Independent Legal Counsel against any and all expenses (including attorneys’ fees), claims, liabilities and damages arising out of or relating to its engagement.

(f) Consequences of Determination; Remedies of Indemnitee. The Company shall be bound by and shall have no right to challenge a Favorable Determination. If an Adverse Determination is made, or if for any other reason the Company does not make timely indemnification payments or advances of Expenses, Indemnitee shall have the right to commence a Proceeding before a court of competent jurisdiction to challenge such Adverse Determination and/or to require the Company to make such payments or advances. Indemnitee shall be entitled to be indemnified for all Expenses incurred in connection with such a Proceeding in accordance with Section 3(b) and to have such Expenses advanced by the Company in accordance with Section 5. If Indemnitee fails to timely challenge an Adverse Determination, or if Indemnitee challenges an Adverse Determination and such Adverse Determination has been upheld by a court of competent jurisdiction, in a final and non-appealable decision then, to the extent and only to the extent required by such Adverse Determination or final decision, the Company shall not be obligated to indemnify or advance Expenses to Indemnitee under this Agreement.

(g) Presumptions; Burden and Standard of Proof. In connection with any Determination, or any review of any Determination, by any person, including a court:

(i) It shall be a presumption that a Determination is not required.

(ii) It shall be a presumption that Indemnitee has met the applicable standard of conduct and that indemnification of Indemnitee is proper in the circumstances.

(iii) The burden of proof shall be on the Company to overcome the presumptions set forth in the preceding clauses (i) and (ii), and each such presumption shall only be overcome if the Company establishes that there is no reasonable basis to support it.

(iv) The termination of any Proceeding by judgment, order, finding, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that indemnification is not proper or that Indemnitee did not meet the applicable standard of conduct or that a court has determined that indemnification is not permitted by this Agreement or otherwise.

(v) Neither the failure of any person or persons to have made a Determination nor an Adverse Determination by any person or persons shall be a defense to Indemnitee’s claim or create a presumption that Indemnitee did not meet the applicable standard of conduct, and any Proceeding commenced by Indemnitee pursuant to Section 6(f) shall be de novo with respect to all determinations of fact and law.

7. Directors and Officers Liability Insurance.

(a) Maintenance of Insurance. So long as the Company or any of its Subsidiaries maintains an insurance policy or policies providing liability insurance for any directors, officers, employees or Agents of any such person, the Company shall ensure, at the Company’s sole cost and expense, that Indemnitee is covered by such insurance policy or policies in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company’s and its Subsidiaries’ then current directors and officers. If at any date (i) such insurance ceases to cover acts and omissions occurring during all or any part of the period of Indemnitee’s Corporate Status or (ii) neither the Company nor any of its Subsidiaries maintains any such insurance, the Company shall ensure that Indemnitee is covered, with respect to acts and omissions prior to such date, for at least six years (or such shorter period as is available on commercially reasonable terms) from such date, by other directors and officers liability insurance, in amounts and on terms (including the portion of the period of Indemnitee’s Corporate Status covered) no less favorable to Indemnitee than the amounts and terms of the liability insurance maintained by the Company on the date hereof; provided that nothing set forth in the foregoing shall otherwise limit the Company’s obligation to (i) indemnify Indemnitee in accordance with Section 3, (ii) contribute to the amount incurred by Indemnitee, whether for all expense, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement), in connection with any Proceeding in accordance with Section 4, and (iii) pay and advance all Expenses incurred by Indemnitee in connection with any Proceeding in accordance with Section 5.

(b) Notice to Insurers. Upon receipt of notice of a Proceeding pursuant to Section 6(a), the Company shall give or cause to be given prompt notice of such Proceeding to all insurers providing liability insurance in accordance with the procedures set forth in all applicable or potentially applicable policies. The Company shall thereafter take all necessary action to cause such insurers to pay all amounts payable in accordance with the terms of such policies.

8. Exculpation, etc.

(a) Limitation of Liability. Indemnitee shall not be personally liable to the Company or any of its Subsidiaries or to the stockholders of the Company or any such Subsidiary for monetary damages for breach of fiduciary duty as a director of the Company or any such Subsidiary; provided that the foregoing shall not eliminate or limit the liability of the Indemnitee if it is found, in a final judgment or other final adjudication that: (i) the Indemnitee has breached his duty of loyalty to the Company or such Subsidiary or the stockholders thereof, (ii) the Indemnitee’s actions or omissions were not in good faith or involved intentional misconduct or a knowing violation of the law, (iii) Indemnitee is not entitled to indemnification in accordance with Section 174 of the DGCL or any similar provision of other applicable corporate law or (iv) with respect to a particular transaction, the Indemnitee derived an improper personal benefit. If the DGCL or such other applicable law shall be amended to permit further elimination or limitation of the personal liability of directors, then the liability of the Indemnitee shall, automatically, without any further action, be eliminated or limited to the fullest extent permitted by the DGCL or such other applicable law as so amended.

(b) Period of Limitations. No legal action shall be brought and no cause of action shall be asserted by or in the right of the Company or any of its Subsidiaries against Indemnitee or Indemnitee’s estate, spouses, heirs, executors, personal or legal representatives, administrators or assigns after the expiration of one (1) year from the date of accrual of such cause of action, and any claim or cause of action of the Company shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such one-year period; provided that if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.

9. Miscellaneous.

(a) Non-Circumvention. The Company shall not seek or agree to any order of any court or other governmental authority that would prohibit or otherwise interfere, and shall not take or fail to take any other action if such action or failure would reasonably be expected to have the effect of prohibiting or otherwise interfering, with the performance of the Company’s indemnification, advancement or other obligations under this Agreement.

(b) Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (iii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

(c) Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) on the date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, (ii) on the first business day following the date of dispatch if delivered by a recognized next-day courier service or (iii) on the third business day following the date of mailing if delivered by domestic registered or certified mail, properly addressed, or on the fifth business day following the date of mailing if sent by airmail from a country outside of North America, to Indemnitee at the address shown on the signature page of this Agreement, to the Company at the address shown on the signature page of this Agreement, or in either case as subsequently modified by written notice.

(d) Amendment and Termination. No amendment, modification, termination or cancellation of this Agreement shall be effective unless it is in writing signed by all the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver.

(e) Successors and Assigns. This Agreement shall be binding upon the Company and its respective successors and assigns, including without limitation any acquiror of all or substantially all of the Company’s assets or business, any person or group (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) that acquires beneficial ownership of securities of the Company representing more than 50% of the total voting power represented by the Company’s then outstanding Voting Securities and any surviving entity of any merger or consolidation to which the Company is party, and shall inure to the benefit of and be enforceable by Indemnitee and Indemnitee’s estate, spouses, heirs, executors, personal or legal representatives, administrators and assigns. The Company shall require and cause any such successor, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement as if it were named as the Company herein, and the Company shall not permit any such purchase of assets or business, acquisition of securities or merger or consolidation to occur until such written agreement has been executed and delivered. No such assumption and agreement shall relieve the Company of any of its obligations hereunder, and this Agreement shall not otherwise be assignable by the Company.

(f) Choice of Law; Consent to Jurisdiction. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware, as applied to contracts between Delaware residents entered into and to be performed entirely within Delaware, without regard to the conflict of law principles thereof. The Company and Indemnitee each hereby irrevocably consents to the jurisdiction of the courts of the State of Delaware for all purposes in connection with any Proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of Delaware.

(g) Integration and Entire Agreement. This Agreement sets forth the entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings and agreements relating to the subject matter hereof between the parties hereto; provided that the provisions hereof shall not supersede the provisions of the Company’s Certificate of Incorporation, Bylaws or other organizational agreement or instrument, any other agreement, any vote of stockholders or directors, the DGCL or other applicable law, to the extent any such provisions shall be more favorable to Indemnitee than the provisions hereof.

(h) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original and both of which, taken together, shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

CREATIVE LEARNING CORPORATION

By:

Name:

Title:

Address:

AGREED TO AND ACCEPTED:

INDEMNITEE:

By: _____________________________

Name:

Title:

Address:

EX-99.2 3 e1528_99-2.htm EXHIBIT 99.2

Exhibit 99.2

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the 1st day of October 2019 between CREATIVE LEARNING CORPORATION ("Company") and Bart Mitchell (“Executive").

In consideration of the promises and the respective covenants and agreements of the parties contained herein, and intending to be legally bound hereby, the parties to this Agreement agree as follows:

Employment. The Company hereby employs the Executive and the Executive hereby accepts employment by the Company for the period and upon the terms and conditions contained in this Agreement.

Term of Agreement. The term of this Agreement will begin on the date first written above (the "Effective Date) and shall continue until September 30, 2020 unless terminated earlier in accordance with the terms of this Agreement ("Term"). On or about August 15, 2020, the Company and the Executive shall review and evaluate renewal of this Agreement, and possible amendment of terms, including compensation. Unless terminated on or before September 30, 2020 this Agreement shall automatically renew on an annual basis thereafter.

Position and Duties. During the Term of this Agreement, the Executive shall serve as Chief Executive Officer of the Company. The Executive shall have such duties and responsibilities as are set forth on the Job Description attached hereto as Exhibit "A", and such other duties as the Board of the Company may reasonably assign from time to time. During the Term of this Agreement, the Executive shall devote such time and effort as required to perform the job requirements of the position and shall work in good faith to perform his duties. The Executive may engage in activities relating to personal matters (including personal financial matters) and in such corporate, industry, civic and charitable activities, so long as such service does not materially interfere with the performance of his duties hereunder or violate his obligations under Section 6 below.

4. Compensation and Related Matters.

4.1 Compensation.

(i) Cash Compensation. The Company shall pay the Executive for the term of this Agreement cash compensation amounting to the equivalent of an annual Base Salary of $150,000, paid in accordance with the Company’s payroll and policy practices;

(ii) Stock Compensation. The Company shall also pay the Executive for the term of this Agreement stock compensation. For purposes of this section, "Average Closing Price" shall mean the average closing value of the stock over the thirty (30) day period prior to the date of the grant of stock or stock options at issue. The stock compensation under this Agreement shall be compensation amounting to the equivalent of the following and pro-rated for partial periods:

(a) stock grants: grants of restricted shares of Creative Learning Company stock issued on the last day of the completed year of employment or, if terminated, prorated for the days filling the position during the year prior to termination, in the amount of $15,000 worth of shares based upon the Average Closing Price or 200,000 restricted shares; whichever is of lesser value.

(ii) Stock Compensation Issuance Acceleration. In the event that the Company is taken private during the Term of this Agreement and all Company stock is redeemed, the Executive shall be entitled to acceleration of the foregoing stock compensation to occur prior to the time any such stock redemption would occur.

(iii) Year-end Bonus and/or Salary Possibility. Prior to September 30, 2020, the Board shall evaluate the Executive's performance from the prior year, and consider the propriety of a year-end bonus and base yearly salary increase considering five factors: (1) meeting budgeted earnings; (2) meeting budgeted sales growth; and (3) enhancement of franchisee support and sales programs (4) meeting franchisee retention and early renewal targets; and (5) meeting budgeted expenses.

(iv) Other. The Executive shall have the right to participate in any the Company’s medical and dental coverage, 401K plan or any other benefits currently, or to be, offered to employees of the Company.

4.2 Work Hours. As it is understood that Executive will be working primarily from Boise, Idaho, and make himself available to address Company affairs during the Company's business hours.

4.3 Vacation. During the Term of this Agreement, the Executive shall be entitled to vacation in accordance with the Company's current policies and practices. To the extent that the Executive wishes to deviate from the Company's policies and practices, the Executive shall make written request to the Board.

5. Termination.

5.1 Termination by Company for Cause. The Company may terminate this Agreement for Cause. For purposes of this Agreement, "Cause" shall mean any one of the following:

(i) the failure by the Executive to work in good faith to perform Executive's duties hereunder if such failure is not cured by Executive within thirty days after a written demand for cure is delivered to Executive by the Board.

(ii) the Executive willfully engaging in misconduct with regard to the Company which is materially injurious to the Company, monetarily or otherwise, including but not limited to fraud, misappropriation or embezzlement by the Executive.

(iii) the Executive's conviction other than a minor traffic violation (or entering into a plea bargain admitting guilt or plea of nolo contendere) of any felony or any misdemeanor involving moral turpitude.

If the Executive is terminated for Cause, the Company shall pay to the Executive his Base Salary through the date of termination, and the Executive shall not be entitled to any further compensation.

5.2 Termination by Company without Cause. The Company may terminate Executive's employment at any time without Cause. Should the Company terminate this Agreement without Cause, the Executive shall be paid his salary through the date of termination, any unreimbursed expenses, and any stock grants or stock options due for the quarter in which termination occurs, and paid as scheduled at quarter-end. Notwithstanding the foregoing, Executive shall be due compensation as fixed by operation of Section 5.3 of this Agreement if the Executive is terminated without Cause: (A) within 6 months of a Change in Control of the Company (as defined in Section 5.3 (iii)); or (B) the Company is taken private.

5.3 Termination by Executive for Good Reason. The Executive may terminate this Agreement for Good Reason. For purposes of this Agreement, "Good Reason" shall mean any one of the following:

(i) a material breach of this Agreement by the Company (including change in Position under Paragraph 3), which is not cured by the Company after the Executive has provided sixty (60) days written notice to cure.

(ii) a reduction by the Company in the Executive's Base Salary as in effect on the date hereof or as the same may be increased from time to time.

(iii) a Change in Control of the Company. For purposes of this paragraph, Change in Control shall mean; any change in board members amounting to a change in the majority of seats on the Company board.

If the Executive terminates this Agreement with Good Reason, the Executive shall be paid an amount equivalent to four (4) months of his Base Salary following the date of termination, any unreimbursed expenses, and any stock grants and stock options due for the quarter in which termination occurs as well as the immediately following three quarters, and paid as scheduled at quarter-end. The payment of Base Salary shall be made in equal amounts every two weeks.

5.4 Disability. The Company may terminate the Executive's employment because of the Executive's Disability. For purposes of this Agreement, the term "Disability" shall mean the Executive's inability to substantially perform the essential functions of his job, with or without reasonable accommodation, due to a physical or mental impairment, for a period of six (6) consecutive months or a period of nine (9) months in any twelve (12) month period.

5.5 Death. This Agreement shall terminate in the event of Executive's death.

5.6 Termination by Executive Without Good Reason. Should the Executive terminate this Agreement without Good Reason, the Executive shall be paid his salary through the date of termination and any unreimbursed expenses, but otherwise shall not be entitled to any further salary, bonus or other compensation or benefits.

6. Restrictive covenants.

6.1 Non-solicitation of Employees/Non-competition Covenant.

6.1(a) During the Executive's employment with the Company and for a period of six (6) months immediately following termination or expiration of such employment for whatever reason, the Executive shall not, directly or indirectly, solicit or attempt to induce any employee or independent contractor employed by the Company in any capacity to terminate his or his employment with the Company, or hire any such employee or independent contractor.

6.1(b) Non-Competition: During the Executive's employment with the Company and for a period of twelve (12) months following the expiration or termination of this Agreement, Executive shall not own (directly or indirectly), operate, be employed by, serve as an independent contractor for, or provide any consulting services to a Competitor. For purposes of this Agreement, the term "Competitor" shall mean any business that (a) offers franchise or license opportunities in the children's educational industry, including without limitation, children's educational programs incorporating the use of building bricks or Legos and/or children's educational programs incorporating instruction on sewing (each a "Franchisor Competitor"); and/or (b) is a franchisee or licensee of a Franchisor Competitor.

IMAGE OMITTED

6.2 Definitions. For the purposes of this section 6: the term "directly or indirectly" shall include either as an individual or as a partner, joint venturer, employee, agent, executive, independent contractor, officer, director, stockholder or otherwise.

6.3 Non-disclosure of Confidential Information. The Executive shall not, directly or indirectly, whether while employed by the Company or afterwards, retain, disclose or use for the benefit of himself or his-self or any other person, corporation, partnership, joint venture, association, or other business organization, any of the trade secrets or confidential business information of the Company ("Confidential Information").

For purposes of this Agreement, "Confidential Information" shall mean

(i) customer lists and prospect lists, specific information on customers and prospective customers (including information on purchasing preferences and pricing for those customers), pricing lists (including item and customer specific pricing information); proprietary purchasing and sales methods and techniques; pricing methods and strategies; computer software design and/or improvements; market feasibility studies; proposed or existing marketing techniques or plans; future company business plans; project files; design systems, information on current and potential vendors, the identity of various suppliers/vendors of products and services, and personal information about the Company's executives, officers and directors; and

(ii) any information that is of value or significance to the Company that derives independent economic value, actual or potential, from not being generally know to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, including information not generally known to the competitors of the Company nor intended by the Company for general dissemination.

In the event the Executive is requested or becomes legally compelled by subpoena, Court order or other legal process to disclose any Confidential Information of the Company, the Executive shall immediately provide notice to the Company so that the Company may interpose an objection and seek an appropriate protective order, and the Executive shall cooperate with the Company in its efforts to obtain such protection.

6.6 Meaning of Directly or Indirectly. For purposes of this section 6, the phrase "directly or indirectly" shall include the Executive acting either as an individual on his own account or the account of another, or as a partner, joint venturer, employee, agent, independent contractor, officer, director, stockholder or otherwise.

6.7 Need for Restrictions. The Executive acknowledges and agrees that each of the restrictive covenants contained in this paragraph 6 is reasonable and necessary to protect the legitimate business interests of the Company, including without limitation the need to protect the Company's trade secrets and confidential information and the need to protect its relationships with its customers.

6.8 Breach of Restrictive Covenants. In the event of a breach by the Executive of any restrictive covenant set forth in paragraph 6, the Executive agrees that such a breach would cause irreparably injury to Company, and that if the Company shall bring legal proceedings against the Executive to enforce any restrictive covenant, the Company shall be entitled to seek all available civil remedies, at law or in equity, including without limitation an injunction, damages, attorneys fees and cost.

6.9 Construction, Survival. If any period of time, area or scope specified in this section 6 should be adjudged unreasonable in any proceeding, then the period of time or area or scope shall be reduced by elimination of such portion deemed unreasonable so that such restrictions may be enforced to the extent adjudged to be reasonable. If the Executive violates any of the restrictions contained in this section, the restrictive period shall be extended by the period of time that such violation exists. All the provisions of this section 6 shall survive the term of this Agreement and the Executive's employment with the Company.

6.10 Subsidiaries and Affiliates. For purposes of this section 6, the term "Company" includes the Company's subsidiary and affiliated entities. All such subsidiary and affiliated entities shall be deemed third party beneficiaries of this Agreement, and shall be entitled to enforce the provisions of this section

7. Return of Company Property. All the Company's products, customer correspondence, internal memoranda, products and designs, sales brochures, training manuals, project files, price lists, customer and vendor lists, prospectus reports, customer or vendor information, sales literature, territory printouts, call books, notebooks, textbooks e-mails and Internet access, computer programs and data, and all other like information or products, including all copies, duplications, replications and derivatives of such information or products, and all laptops, pagers, beepers, keys, access cards and other similar property, acquired by the Executive while in the employ of the Company ("Company Property"), shall be the exclusive property of the Company and shall be returned to the Company promptly upon the Executive's separation from the Company. During the Executive's employment with the Company, no Company Property shall be removed from the Company's premises unless authorized by Company management and necessary for the Executive to perform his duties for the Company.

8. Prior Agreements. The Executive represents to the Company (a) that there are no restrictions, agreements or understandings whatsoever to which the Executive is a party which would prevent or make unlawful the Executive's execution of this Agreement or employment hereunder, (b) that the Executive's execution of this Agreement and employment hereunder shall not constitute a breach of any contract, agreement or understanding, oral or written, to which the Executive is a party or by which the Executive is bound, and (c) that the Executive is free and able to execute this Agreement and to enter into employment by the Company.

9. Miscellaneous.

9.1 Right to review and seek counsel. The Executive hereby acknowledges that he has been provided with a copy of this Agreement for review prior to signing it, that he has been given the opportunity to have this Agreement reviewed by his own attorney prior to signing it, that he understands the purposes and effects of this Agreement, and that he has been given a signed copy of this Agreement for his records.

9.2 Waiver. No modification or waiver of this Agreement will be valid unless the modification or waiver is in writing and signed by both of the parties. The failure of either party at any time to insist upon the strict performance of any provision of this Agreement will not be construed as a waiver of the right to insist upon the strict performance of the same provision at any future time.

9.3 Entire Agreement; Amendments. This Agreement, together with any schedules and/or exhibits attached, constitutes the entire agreement between the Executive and the Company pertaining to the subject matters of the Agreement, and supersedes all negotiations, preliminary agreements, and all prior and contemporaneous discussions and understandings of the parties hereto. Any amendments to this Agreement must be in writing and signed by both the Executive and the Company.

9.4 Governing Law. This Agreement shall be governed and construed in accordance with the laws of the State of Idaho without regard to conflicts of law.

9.5 Severability. If any part of this Agreement or the application of any part is held invalid by a court of competent jurisdiction, the remainder of this Agreement shall not be affected and shall be construed and enforced to the fullest extent allowed by law.

9.6 Consent to Personal Jurisdiction and Venue. The parties hereby consent to exclusive personal jurisdiction and exclusive venue in the state and federal courts in and for Boise, Idaho, for any action between the Company and the Executive arising out of or in connection with this Agreement or the Executive's employment with the Company.

9.7 Headings and Captions; Counterparts. The titles and captions of sections and subsections contained in this Agreement are provided for convenience of reference only, and shall not be considered terms or conditions of this Agreement. This Agreement may be executed in counterparts, all of which shall be considered one agreement.

9.8 Successor and Assigns. This Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Executive agrees that this Agreement may be assigned by the Company. This Agreement is not assignable by the Executive.

9.9 Survival. The provisions of section 6 shall survive the termination of the Executive's employment with the Company and the termination this Agreement.

9.10 Attorney's Fees. In the event of any dispute arising out of or in connection with this Agreement, the prevailing party in any ensuing litigation shall be entitled to recover all court costs and reasonable attorneys' fees, including attorneys' fees on appeal, from the non-prevailing party.

9.11 Directors and Officers Insurance Policy. The Company represents that if it has in place a Directors & Officers insurance policy, and that the Executive will be added to that policy as a named insured. If no policy is in place, the Company will indemnify the Executive the the fullest extent possible.

9.12 Waiver of Jury Trial. In any legal action between the Executive and the Company arising out of or in connection with this Agreement, the Company and the Executive hereby expressly waive trial by jury.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date first above written.

CREATIVE LEARNING CORPORATION

_______________________________

Gary Herman

Chairman – Audit Committee

Chairman - Compensation Committee

EXECUTIVE

_________________________________

Bart J Mitchell

Exhibit A:

Chief Executive Officer

PRIMARY FUNCTION: The CEO generally oversees the safe and effective financial, developmental, structural, and service operations of the company.

DUTIES: Include, but are not limited to:

Supervising and supporting the administrative, sales, marketing, financial, and franchisee departments to ensure the success of franchisees and staff and the fulfilling of company objectives.
Developing, maintaining, and supervising the fulfilling of all company policies and procedures in accordance with company mission and objectives and applicable federal and state laws.
Developing and maintaining proper information systems, documentation, resources, curriculum, and services for franchisees and the company.
Supervising, liaising, and providing company services for consumer recruitment, public relations, marketing activities, and company relations with company affiliated referring professionals, partner institutions, franchisees, fellow staff members, external agencies, government departments, and parties outside the company.
Developing and maintaining staff support, training, performance standards, meeting schedules & itineraries as necessary to provide outstanding services.
Managing and maintaining company property, vehicles, supplies, equipment, leases, contracts, licenses, insurances, and permits for company usage.
Developing and maintaining a high level of company quality assurance and safety standards, assessments, and processes in all areas of company operation.
Supervising the management of the company’s financial resources and budgets, including incoming and outgoing expenditures, donations, and profits.
Preparing and maintaining official company reports and statistics for internal and external use.

EX-99.3 4 e1528_99-3.htm EXHIBIT 99.3

Exhibit 99.3

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the1st day of October, 2019 between Creative Learning Corporation, ("Company") and Robert Boyd (“Employee").

The parties to this Agreement agree as follows:

Employment. Contingent on a satisfactory background check, the Company hereby employs the Employee and the Employee hereby accepts employment by the Company for the period and upon the terms and conditions contained in this Agreement. This Agreement shall replace and supersede any previous employment agreement of the Employee.

Term of Agreement. The term of this Agreement will begin on the date first written above (the "Effective Date) and shall continue until September 30, 2020 unless terminated earlier in accordance with the terms of this Agreement ("Term"). On or about August 1, 2020, the Company and the Employee may review and evaluate renewal of this Agreement, and possible amendment of terms.

Position and Duties. During the Term of this Agreement, the Employee shall serve as the Chief Accounting Officer of the Company. The Employee shall have such duties and responsibilities as are set forth on the Job Description attached hereto as Exhibit "A", and such other duties as the Company may reasonably assign from time to time. During the Term of this Agreement, the Employee shall devote all necessary working time and efforts to the business and affairs of the Company and shall work in good faith to perform his duties. It is understood that the position is part-time and the Employee will continue to operate and run his other business interests during his employment with the Company. However, it is understood that the Employee will prioritize his time so that his duties with the Company are performed with all diligence and timeliness.

4. Compensation and Related Matters.

4.1 Compensation.

(i) Cash Compensation. The Company shall pay the Employee for the term of this Agreement cash compensation amounting to the equivalent of an annual Base Salary figure of $40,000, paid in accordance with the Company’s payroll and policy practices;

4.2 Work Hours. It is understood that the Employee will be working remotely, often from a home office, or other location. Regardless of location, unless on vacation, the Employee shall make himself available to address Company affairs during the Company's business hours as needed.

4.3 Vacation. During the Term of this Agreement, the Employee shall be entitled to vacation in accordance with the Company's current policies and practices.

5. Termination.

5.1 At Will Acknowledgment. Both the Employee and The Company acknowledge the “At Will” employment nature of the State of Idaho. As such, either the Employee or the Employer may terminate this Agreement without cause or notice. Termination by either party must be submitted in writing and appropriately dated. .

5.2 Payment at Termination. If the employment relationship is terminated for any reason, the Company shall pay to the Employee his Base Salary through the date of termination, and the Employee shall be reimbursed any outstanding expenses in accordance with State law.

6. Restrictive covenants.

6.1 Non-solicitation of Employees. During the Employee's employment with the Company and for a period of twelve (12) months immediately following termination of such employment for whatever reason, the Employee shall not, directly or indirectly, solicit or attempt to induce any employee or independent contractor employed by the Company in any capacity to terminate his or his employment with the Company, or hire any such employee or independent contractor.

6.3 Non-disclosure of Confidential Information. The Employee shall not, directly or indirectly, whether while employed by the Company or afterwards, retain, disclose or use for the benefit of herself or his-self or any other person, corporation, partnership, joint venture, association, or other business organization, any of the trade secrets or confidential business information of the Company ("Confidential Information").

For purposes of this Agreement, "Confidential Information" shall mean

In the event the Employee is requested or becomes legally compelled by subpoena, Court order or other legal process to disclose any Confidential Information of the Company, the Employee shall immediately provide notice to the Company so that the Company may interpose an objection and seek an appropriate protective order, and the Employee shall cooperate with the Company in its efforts to obtain such protection.

6.6 Meaning of Directly or Indirectly. For purposes of this section 6, the phrase "directly or indirectly" shall include the Employee acting either as an individual on his own account or the account of another, or as a partner, joint venturer, employee, agent, independent contractor, officer, director, stockholder or otherwise.

6.7 Need for Restrictions. The Employee acknowledges and agrees that each of the restrictive covenants contained in this paragraph 6 is reasonable and necessary to protect the legitimate business interests of the Company, including without limitation the need to protect the Company's trade secrets and confidential information and the need to protect its relationships with its customers.

6.8 Breach of Restrictive Covenants. In the event of a breach by the Employee of any restrictive covenant set forth in paragraph 6, the Employee agrees that such a breach would cause irreparable injury to Company, and that if the Company shall bring legal proceedings against the Employee to enforce any restrictive covenant, the Company shall be entitled to seek all available civil remedies, at law or in equity, including without limitation an injunction, damages, attorneys fees and cost.

6.9 Construction, Survival. If any period of time, area or scope specified in this section 6 should be adjudged unreasonable in any proceeding, then the period of time or area or scope shall be reduced by elimination of such portion deemed unreasonable so that such restrictions may be enforced to the extent adjudged to be reasonable. If the Employee violates any of the restrictions contained in this section, the restrictive period shall be extended by the period of time that such violation exists. All the provisions of this section 6 shall survive the term of this Agreement and the Employee's employment with the Company.

7. Return of Company Property. All the Company's products, customer correspondence, internal memoranda, products and designs, sales brochures, training manuals, project files, price lists, customer and vendor lists, prospectus reports, customer or vendor information, sales literature, territory printouts, call books, notebooks, textbooks e-mails and Internet access, computer programs and data, and all other like information or products, including all copies, duplications, replications and derivatives of such information or products, and all laptops, pagers, beepers, keys, access cards and other similar property, acquired by the Employee while in the employ of the Company ("Company Property"), shall be the exclusive property of the Company and shall be returned to the Company promptly upon the Employee's separation from the Company. During the Employee's employment with the Company, no Company Property shall be removed from the Company's premises unless authorized by Company management and necessary for the Employee to perform his duties for the Company.

8. Prior Agreements. The Employee represents to the Company (a) that there are no restrictions, agreements or understandings whatsoever to which the Employee is a party which would prevent or make unlawful the Employee's execution of this Agreement or employment hereunder, (b) that the Employee's execution of this Agreement and employment hereunder shall not constitute a breach of any contract, agreement or understanding, oral or written, to which the Employee is a party or by which the Employee is bound, and (c) that the Employee is free and able to execute this Agreement and to enter into employment by the Company.

9. Miscellaneous.

9.1 Right to review and seek counsel. The Employee hereby acknowledges that he has been provided with a copy of this Agreement for review prior to signing it, that he has been given the opportunity to have this Agreement reviewed by his own attorney prior to signing it, that he understands the purposes and effects of this Agreement, and that he has been given a signed copy of this Agreement for his records.

9.3 Entire Agreement; Amendments. This Agreement, together with any schedules and/or exhibits attached, constitutes the entire agreement between the Employee and the Company pertaining to the subject matters of the Agreement, and supersedes all negotiations, preliminary agreements, and all prior and contemporaneous discussions and understandings of the parties hereto. Any amendments to this Agreement must be in writing and signed by both the Employee and the Company.

9.4 Governing Law. This Agreement shall be governed and construed in accordance with the laws of the State of Idaho without regard to conflicts of law.

9.6 Consent to Personal Jurisdiction and Venue. The parties hereby consent to exclusive personal jurisdiction and exclusive venue in the state and federal courts in and for Boise, Idaho, for any action between the Company and the Employee arising out of or in connection with this Agreement or the Employee's employment with the Company.

9.8 Successor and Assigns. This Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and the Employee agrees that this Agreement may be assigned by the Company. This Agreement is not assignable by the Employee.

9.9 Survival. The provisions of section 6 shall survive the termination of the Employee's employment with the Company and the termination this Agreement.

9.11 Waiver of Jury Trial. In any legal action between the Employee and the Company arising out of or in connection with this Agreement, the Company and the Employee hereby expressly waive trial by jury.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date first above written.

CREATIVE LEARNING CORPORATION

_______________________________

Bart J Mitchell

Chief Executive Officer

EMPLOYEE

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Robert Boyd

Exhibit A:

Chief Accounting Officer

PRIMARY FUNCTION: The Chief Accounting Officer (CAO) primarily provides financial leadership and oversight for the business and works with the CEO on developing and overseeing the financial operations of the company.

DUTIES: Include, but are not limited to:

Financial Supervision:

Insuring that correct financial procedures are followed.

Insuring all financial filings are done correctly and on time.

Providing financial reports, projections, budgets and direction to the CEO and the Board of Directors.

Administering payroll.

Insuring that the Company’s financial Internal Controls are followed.

Reviewing and approving with the CEO expenses, reimbursements and purchase orders.

Oversight of Accounts Payables and Accounts Receivables.

Work with the Bookkeeper to insure the accuracy and quality of the Company’s accounting processes.

Initiating, reviewing and implementing company policies and procedures as a member of the executive board.

Attending and participating in professional meetings and conferences for the benefit of the company.

Insuring excellent communication, relations, and service is provided to customers, franchisees, professionals, regulating agencies, and referral sources.

Maintaining compliance with applicable state, federal and oversight requirements for licensure and best practices.

Maintaining proper financial systems, documentation, resources, and services for staff in all departments.
Maintaining a high level of company financial quality assurance and safety standards, assessments, and processes in all departments.
Managing the company’s financial resources and budgets, including preparing and submitting quarterly and yearly financial statements.
Working with legal and accounting professionals to insure the company’s compliance with all SEC requirements.
Preparing and maintaining operational reports and statistics for internal and external use.

Staff Supervision:

Supervising and coordinating with executive staff regarding financial functions.

Assisting the CEO in supervising and supporting all executive staff in maintaining high service standards.

Assisting the CEO in teaching, training, and implementing a business model that reflects the company’s mission statement.

Assisting the CEO in supervising the staff to comply with company policies and state, federal, and licensing requirements.
Assisting the CEO in setting company and staff goals and setting clear criteria to measure success.

	·	Assisting the CEO in guiding and supporting the staff in maintaining high service standards.
	·	Assisting the CEO in supervising the daily, weekly, monthly and yearly calendar of company functions and activities to be performed in all departments