**Exhibit 10.16**

 

**ADMINISTRATIVE SERVICES AGREEMENT**

 

**THIS ADMINISTRATIVE SERVICES AGREEMENT** (“Agreement”)is made and entered into this 18th day of July, 2006, (“EffectiveDate”), between Whitney Education Group, Inc. (“Whitney”), a corporationduly organized and incorporated in the State of Florida, and Rich Dad Education(“Rich Dad”), a Wyoming limited liability company.

 

**WITNESSETH:**

** **

WHEREAS, Whitney is in the business of developing, producing,marketing, and fulfilling post secondary education curricula on finance andreal estate, business development, and asset protection;

 

WHEREAS, Rich Dad is in the business of developing, producing, andmarketing post secondary educational curricula in real estate, securities,financial investment, and asset production;

 

WHEREAS, the parties desire Whitney’s assistance to perform certainbusiness operations in a cost effective and efficient manner;

 

NOW, THEREFORE, for good and valuable consideration of the mutualcovenants and promises herein contained, the parties, each intending to belegally bound, hereby agree as follows:

 

**TERMS AND CONDITIONS**

 

**ARTICLE 1: SERVICES, TERMS &CONDITIONS**

** **

1.01         Whitneyshall serve Rich Dad by providing and performing the following services:

 

(a)           administrative and operational assistance asneeded through the following departments:

 
| 1.  | Legal;                    |
|-----|---------------------------|
| 2.  | Accounting/Finance;       |
| 3.  | Booking;                  |
| 4.  | Confirmations;            |
| 5.  | Education’           |
| 6.  | Facilities Maintenance;   |
| 7.  | Human Resources;          |
| 8.  | Information Technologies; |
| 9.  | Marketing;                |
| 10. | Operations;               |
| 11. | Sales; and                |
| 12. | Shipping.                 |

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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(b)           supervise and direct the general operationsof the departments listed in 1.01 (a);

(c)           operate these departments efficiently andwith proper economy;

(d)           develop internal policies necessary for thecreation of the greatest possible net income;

(e)           collect revenue;

(f)            stimulated the general business of RichDad;

(g)           employ at WIN’s expense such officers, assistants,employees, sales personnel, and operations staff as may be requires to continuethat standard and quality of management and operation at a level not lower thanthat heretofore maintained;

(h)           perform all other acts necessary ordesirable in the operation of these services

 

1.02         Whitneyshall permit Rich Dad to utilize certain Whitney assets and services, includingoffice space and equipment, as agreed upon by the parties.

 

1.03         Whitneyagrees to prepare and maintain full, accurate, and complete records of allservices provided under this Agreement. Upon request, Whitney agrees to provide Rich Dad with reporting ofservices provided in a format to be mutually agreed upon by the parties.

 

1.04         Whitneyshall provide the services under this agreement in a professional, courteousmanner, consistent with industries standards. Whitney shall comply with all codes. Whitney shall keep all information generated as a result of this Agreementconfidential and shall make all reasonable efforts to keep such informationaway from competing companies

 

1.05         Exceptas provided for in the Operating Agreement, in providing the serviceshereunder, Whitney shall not at any time do or cause to be done any actor thingor make or cause to be any omission that would:

 

(a)           tend to impair or damage the goodwillassociated with any trademarks or service marks used by Rich Dad, whether suchmarks are owned by Rich Dad or used under license from a third party;

 

(b)           contest or in anyway impair or intend toimpair any part of the licensor’s right, title, and interest in trademarks orservice marks used by Rich Dad, under license from a third party;

 

(c)           violate or infringe any right of privacy orpublicity, copyright, or trademark or constitute defamatory, obscene orunlawful matter, or otherwise violate or infringe any personal or proprietaryrights of any person, firm, or corporation

 

1.06         Restrictions on Authorityof Managers

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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(a)           Except as may be contained in the ApprovedBudget, Whitney shall not have the authority to, and covenants and agrees thatit shall not, do any of the following acts without the consent of the Members:

 

(i)            Confess a judgment against Rich Dad in anamount in excess of $100,000

 

(ii)           possess tangible or and intangible propertyacquired by Rich Dad or and any improvements thereto (Rich Dad Property), orassign rights in specific Rich Dad Property, for other than a Security purpose;

 

(iii)          Knowingly perform any act that would subjectRich Dad Education or any parent, affiliates, subsidiaries, officers,directors, agents, owners, employees, trustees, successors, and assigns of RichDad (other than Whitney) to liability as a partner in any jurisdiction;

 

(iv)          Cause Rich Dad to acquire any equity or debtsecurities of Whitney or any of its/their, or otherwise make loans to Whitneyor any of its/their affiliates.  As usedherein “affiliate” means (i) any entity directly or indirectly controlling,controlled by, or under any common control with Whitney, (ii) any entityowning or controlling ten percent (10%) or more of the outstanding votinginterests of Whitney, (iii) director, general partner, trustee, or holderof ten percent (10%) or more of the voting interests of any entity described inclauses (i) through (iii) of this sentence.  For purposes of this definition, the term “controls,”“is controlled by,” or “is under common control with” shall mean thepossession, direct or indirect, of the power to direct or cause the directionof the management and policies of a person or entity, whether through theownership of voting securities, by contract or otherwise.

 

(v)           Cause Rich Dad to sell or otherwise issueany additional equity interests or shares in Rich Dad Education; or

 

(vi)          Sell or otherwise dispose of all orsubstantially all of the Rich Dad Property, except for a liquidating sale ofRich Dad Education Property in connection with the dissolution of Rich Dad;

 

(vii)         Cause Rich Dad to voluntarily take any actionthat would cause a Bankruptcy of Rich Dad;

 

(viii)        Subject to the Approved Budget, cause Rich Dadto incur or refinance any Debt in any single transaction, or series of relatedtransactions, in excess of $100,000; and

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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(ix)           Cause Rich Dad to make any capitalexpenditure in any single transaction, or series of related transactions, inexcess of $100,000;

 

(b)           Whitney shall not have the authority to, andcovenants and agrees that it shall not, do any of the following acts withoutthe consent of the Members, provided that upon the receipt of such consent,Whitney shall have the authority to do any of the following:

 

(i)            Cause Rich Dad to enter any agreementinvolving value over $100,000 or having a term of over 24 months

 

(ii)           Hire or fire executive management.

 

(iii)          Enter into or exit strategic alliances.

 

**ARTICLE 2: COMPENSATION**

 

2.01         Whitneyshall be compensated for all services provided under this Agreement at amonthly rate consisting of actual Expenses incurred plus an administrative feeof ***.

 

2.02         Whitneyshall invoice Rich Dad on a monthly basis with invoices to be submitted withintwenty (20) days of the month’s end. Rich Dad shall settle its outstanding balance within thirty (30) days ofthe invoice date.

 

2.03         Theparties recognize and acknowledge that the services to be provided by Whitneyunder this Agreement will change frequently, depending on the needs of RichDad.  As such, the parties agree that thecompensation paid will be adjusted at the parties’ discretion and in accordancewith the change in services to be provided. Any such adjustment shall require the consent of the Members.  Whenever appropriate, but at least on aquarter basis, the parties shall meet to discuss whether a revision to thecompensation fee under Section 2.01 is required.  In the event that such a revision isrequired, the parties shall agree upon a revised fee, which will replace thethen most current compensation fee under Section 2.01.  Should the parties not reach an agreementupon whether a revision is necessary, the most recent Schedule shall controland either party may invoke their rights under Section 3.03 of thisAgreement.

 

**ARTICLE 3: TERM AND TERMINATION**

** **

3.01         Term.  The date of commencement of this Agreementshall be on the Effective Date first set forth above and shall continue untilterminated as provided under Section 3.03

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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3.02         ImmediateRight to Terminate.  Either party shallhave the right to immediately terminate this Agreement by giving written noticein the event that the other party does any of the following:

 

A.            Files a petition inbankruptcy or is adjudicated bankrupt or insolvent, or makes an assignment forthe benefit of creditors, or an arrangement pursuant to any bankruptcy law, ordiscontinues or dissolves its business; or

 

B.            Engages in anyillegal, unfair, or deceptive business practices or unethical conductwhatsoever.

 

3.03         Rightto Terminate on Notice.  Each party shallhave the right, exercisable in its absolute discretion, to terminate thisAgreement upon ninety (90) days prior written notice received by United Statesregistered mail, certified mail, UPS Next Day Letter or Federal Express NextDay Letter by the other party.

 

3.04         Terminationof Rights. On the termination of this Agreement, all obligations of the partieshereunder shall terminate, except for rights to payments accrued prior to suchtermination and provisions applicable after termination.

 

ARTICLE 4: GENERAL PROVISIONS

 

4.01         EntireAgreement.  This Agreement supersedes anyand all other agreements, either oral or in writing between the parties heretowith respect to the terms and conditions of this Agreement, and contains all ofthe covenants and agreements between the parties with respect to same.  Each party to this Agreement acknowledgesthat no representation, inducements, promises, or agreements, orally orotherwise, have been made by any party, or anyone acting on behalf of anyparty, which are not embodied herein, and that no other agreement, statement,or promise not contained in this Agreement shall be valid or binding on eitherparty, except that any other written agreement dated concurrent with or afterthis agreement shall be valid as between the signing parties thereto.

 

4.02         Severability.  If any provision in this Agreement is held bya court of competent jurisdiction to be invalid, void, or unenforceable, theremaining provisions shall nevertheless continue in full force without beingimpaired or invalidated in anyway.

 

4.03         Notice.Each notice, request or demand given or required to be given pursuant to thisAgreement shall be in writing, and shall be deemed sufficiently given ifdeposited in the United States mail, First Class, postage pre-paid, andaddressed to the address of the intended recipient set forth below, or to such otheraddresses as may be specified in this Agreement or in writing by the parties:

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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| If to Whitney:  | Name:      | Ronald S. Simon                       |
|-----------------|------------|---------------------------------------|
|            | Address:   | 1612 E. Cape Coral Pkwy, Suite B |
|            |       | Cape Coral, FL 33904                  |
|            | Telephone: | (239) 542-0643                        |
|            | Facsimile: | (239) 540-6565                        |
|            |       |                                  |
|            | Copy to:   | Marie B. Code, Esq.              |
|            |       | 1612 E. Cape Coral Pkwy, Suite A |
|            |       | Cape Coral, FL 33904                  |
|            |       |                                  |
| If to Rich Dad: | Name:      | Thomas McElroy                        |
|            | Address:   | 1612 E. Cape Coral Pkwy               |
|            |       | Cape Coral, FL 33904                  |
|            | Telephone: | (239) 540-6597                        |
|            | Facsimile: | (239) 540-6501                        |
|            |       |                                  |
|            | Copy to:   | Sharon Lechter                        |
|            |       | Rich Dad Global, Inc.            |
|            |       | 4330 N. Civic center Plaza            |
|            |       | Scottsdale, AZ 85251                  |

 

4.04         GoverningLaw and Attorney Fees.  This Agreementshall be deemed to have been made in the State of Florida.  This Agreement and all matters arising out ofor otherwise relating to this Agreement shall be governed by the laws of theState of Florida.  The parties herebysubmit to the personal jurisdiction of the state and federal courts of theState of Florida.  In any arbitrationand/or litigation arising out of this agreement, the prevailing party shall beentitled to recover reasonable attorneys’ fees and costs, including attorneys’fees incurred on appeal.

 

4.05         Authorityto Enter Agreement.  The parties warrantthat they have the authority to enter into this Agreement and that enteringinto this Agreement is not restricted or prohibited by any existing agreementto which they are parties.  Additionally,the parties represent and warrant that this agreement has been authorized andapproved by all necessary corporate actions. Both parties warrant and represent that all individuals executing thisAgreement have the authority to do so.

 

4.06         Rightto Audit.  Each party (and its officers,directors, and owners), shall have the right to audit (or have audited by aCPA) the other’s business records concerning services rendered under thisAgreement upon five (5) days prior written notice.  The requesting party shall have the right toreceive photocopies of all applicable business records concerning servicesrendered under this Agreement upon five (5) days prior written notice.

 

4.07         Assignment.  The rights and liabilities of this Agreementshall be binding on and inure to the benefit of the respective parties andtheir respective heirs, legal representatives, successors, and assigns.  Neither party shall have the right to sell,transfer, assign, sublicense, or subcontract any right or obligation hereunderwithout first obtaining prior written consent from the other party.

 

[***] Confidential treatment requested.Omitted portions have been filed separately with the Securities and ExchangeCommission.

 

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4.08         Indemnification.  Each party shall release, defend, indemnify,and hold the other party and its parent, affiliates, subsidiaries, officers,directors, agents, owners employees, trustees, successors, and assigns harmlesswith respect to any claims, actions, causes of action, damages, fines,expenses, court costs, attorney fees, liability damage or breach of the otherparty’s or his agent’s responsibilities, representations, and warrantiesherein, and/or arising from the purchase or use of the party’s products orservices sold by the other party, and/or all negligent acts or omissions of aparty or his agents.

 

4.09         Counterparts.  This Agreement may be executed in two or morecounterparts, including facsimile counterparts, each of which shall be deemedan original, but all of which together shall constitute one and the sameinstrument.

 

4.10         Conflicts.  Should any conflicts arise between thisAgreement and the LLC Agreement (the Operating Agreement), the LLC Agreementshall prevail.

 

IN WITNESS THEREOF, the parties hereto, intending to be legally boundhereby, have caused this Agreement to be executed by their respective dulyauthorized representatives as of the day indicated.

 
| WHITNEY INFORMATION NETWORK, INC |   | RICH DAD EDUCATION, INC. |
|----------------------------------|--------|--------------------------|
|                             |   |                     |
|                             |   |                     |
| /s/ Ronald S. Simon              |   | /s/ Sharonl L Lechter    |
| Ronald S. Simon, Secretary       |   |                     |   |

 

[***] Confidential treatment requested. Omitted portions have beenfiled separately with the Securities and Exchange Commission.

 

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