Management Operating Agreement for Australia

Management Operating Agreement Template for Australia

A Management Operating Agreement is a comprehensive legal document used in Australian jurisdictions to establish and govern the relationship between an asset owner/principal and a management operator. The agreement details the appointment of an operator to manage specific assets or operations on behalf of the owner, including scope of authority, operational responsibilities, performance standards, financial arrangements, and reporting requirements. It incorporates Australian legal requirements including corporations law, employment regulations, and state-specific business requirements, while establishing clear governance frameworks and risk allocation between parties.

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What is a Management Operating Agreement?

The Management Operating Agreement is a crucial document used in Australian business contexts where an owner/principal delegates operational responsibility to a professional management operator. This arrangement is common across various industries including hospitality, healthcare, infrastructure, and commercial property management. The agreement comprehensively addresses all aspects of the management relationship, including appointment terms, scope of services, performance standards, financial arrangements, and risk allocation. It must comply with Australian federal and state legislation, including the Corporations Act 2001, Fair Work Act 2009, and relevant industry-specific regulations. The document is particularly valuable when specialized expertise is required for asset management, when owners want to maintain ownership while delegating operational responsibility, or when sophisticated operational frameworks need to be established with clear accountability and performance metrics.

What sections should be included in a Management Operating Agreement?

1. Parties: Identification of all parties to the agreement, including the owner/principal and management operator

2. Background: Context of the agreement, including brief description of the business and purpose of the management arrangement

3. Definitions and Interpretation: Detailed definitions of terms used throughout the agreement and rules of interpretation

4. Appointment and Term: Formal appointment of the operator and duration of the agreement, including renewal terms

5. Operator's Rights and Obligations: Comprehensive outline of the operator's authority, responsibilities, and scope of services

6. Owner's Rights and Obligations: Details of the owner's ongoing responsibilities, reserved powers, and obligations

7. Financial Management: Management of accounts, budgeting, reporting requirements, and financial controls

8. Fees and Payments: Structure of management fees, performance fees, and payment terms

9. Staff and Employment: Management of employees, responsibilities for employment obligations, and HR policies

10. Reporting and Communication: Required reports, frequency of meetings, and communication protocols

11. Insurance and Liability: Insurance requirements and allocation of liability between parties

12. Termination: Grounds for termination, notice requirements, and consequences of termination

13. Handover Provisions: Process for transition of management at end of term or termination

14. General Provisions: Standard legal provisions including governing law, notices, and dispute resolution

What sections are optional to include in a Management Operating Agreement?

1. Intellectual Property: Required when specific IP rights need to be protected or licensed as part of the operation

2. Non-Compete and Confidentiality: Additional restrictions on operator's activities and information handling

3. Performance Metrics: Specific KPIs and performance measurement criteria when performance-based compensation is included

4. Emergency Procedures: Special provisions for handling emergency situations in high-risk operations

5. Environmental Compliance: Required for operations with significant environmental impacts or obligations

6. Technology and Systems: When specific technology or systems are critical to the operation

7. Capital Expenditure: Required when operator has authority to make or recommend capital improvements

8. Marketing and Branding: When operator has specific responsibilities for marketing and brand management

What schedules should be included in a Management Operating Agreement?

1. Schedule 1 - Services Specification: Detailed description of all services to be provided by the operator

2. Schedule 2 - Fee Structure: Detailed breakdown of all fees, charges, and payment calculations

3. Schedule 3 - Performance Criteria: Specific performance metrics and measurement methodologies

4. Schedule 4 - Operating Procedures: Standard operating procedures and policies

5. Schedule 5 - Asset Register: List of assets under management

6. Schedule 6 - Reporting Templates: Standard formats for required reports and documentation

7. Schedule 7 - Insurance Requirements: Detailed insurance specifications and minimum coverage requirements

8. Appendix A - Initial Budget: Approved operating budget for initial period

9. Appendix B - Key Personnel: List of key management positions and approved personnel

10. Appendix C - Compliance Requirements: Specific regulatory and compliance obligations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Genie AI

Sector

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Healthcare

Hospitality

Infrastructure

Mining

Manufacturing

Retail

Education

Aged Care

Facilities Management

Property Development

Asset Management

Energy and Resources

Agriculture

Relevant Teams

Legal

Operations

Commercial

Risk and Compliance

Facilities Management

Asset Management

Business Development

Property Management

Contract Administration

Executive Leadership

Finance

Relevant Roles

Chief Executive Officer

Chief Operating Officer

Operations Director

Facility Manager

Asset Manager

General Counsel

Legal Counsel

Commercial Director

Contract Manager

Business Development Manager

Risk Manager

Compliance Officer

Property Manager

Operations Manager

Project Director

Managing Director

Head of Operations

Director of Facilities

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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