Operating Management Agreement for Canada

Operating Management Agreement Template for Canada

A comprehensive legal agreement governed by Canadian law that establishes the relationship between an owner and a professional management company for the operation of a business, property, or facility. The agreement details the operator's authority, responsibilities, and compensation while outlining the owner's retained rights and oversight mechanisms. It includes provisions for financial management, reporting requirements, personnel matters, risk allocation, and operational standards, all within the framework of Canadian federal and provincial regulations. The document addresses key aspects such as compliance with Canadian employment laws, tax requirements, and industry-specific regulations.

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What is a Operating Management Agreement?

The Operating Management Agreement is a crucial document used when a business owner or asset holder wishes to delegate operational management to a professional management company while retaining ownership and ultimate control. This arrangement is common across various sectors in Canada, from real estate and hospitality to healthcare and manufacturing. The agreement must comply with Canadian federal and provincial regulations, including corporate laws, employment standards, tax requirements, and industry-specific regulations. It typically includes detailed provisions for operational authority, financial management, reporting structures, risk allocation, and performance standards. The document is essential for businesses seeking professional management expertise while maintaining asset ownership and regulatory compliance within the Canadian business environment.

What sections should be included in a Operating Management Agreement?

1. Parties: Identification of the property owner and the management company

2. Background: Context of the agreement, including property details and purpose of the management arrangement

3. Definitions: Key terms used throughout the agreement

4. Appointment and Term: Formal appointment of the operator and duration of the agreement

5. Operator's Rights and Responsibilities: Detailed scope of management services and operational authority

6. Owner's Rights and Obligations: Owner's retained rights and ongoing obligations

7. Financial Management: Budget process, financial reporting, and accounting requirements

8. Fees and Payments: Management fees, reimbursements, and payment terms

9. Personnel and Employment Matters: Staffing responsibilities and employment relationships

10. Insurance and Indemnification: Required insurance coverage and mutual indemnification provisions

11. Default and Termination: Events of default, remedies, and termination procedures

12. Transition Upon Termination: Handover process and post-termination obligations

13. Confidentiality: Protection of confidential information and trade secrets

14. Dispute Resolution: Process for resolving disputes between parties

15. General Provisions: Standard boilerplate clauses including notices, assignment, and amendments

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

1. Environmental Compliance: Required when the operation involves significant environmental considerations

2. Intellectual Property: Needed when the operation involves branded operations or proprietary systems

3. Force Majeure: Detailed force majeure provisions for high-risk or critical operations

4. Non-Competition: Required when protecting against competitive activities is crucial

5. Emergency Services: Needed for operations requiring specific emergency response procedures

6. Capital Expenditure: Required when operator has authority over capital improvements

7. Performance Standards: Include when specific performance metrics are crucial to the operation

8. Technology and Systems: Needed when specialized software or systems are part of the management services

What schedules should be included in a Operating Management Agreement?

1. Property Description: Detailed description of the managed property or assets

2. Services Specification: Detailed scope of management services and performance standards

3. Fee Schedule: Detailed breakdown of all fees, charges, and payment calculations

4. Initial Budget: First-year operating budget and financial projections

5. Key Personnel: List of key management positions and required qualifications

6. Required Insurance: Detailed insurance requirements and coverage limits

7. Operating Procedures: Standard operating procedures and policies

8. Reporting Requirements: Templates and specifications for required reports

9. Emergency Procedures: Emergency response and business continuity procedures

10. Handover Checklist: Detailed list of items and procedures for transition upon termination

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

Canada

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Hospitality

Healthcare

Senior Living

Manufacturing

Infrastructure

Retail

Energy

Transportation

Facilities Management

Entertainment

Education

Relevant Teams

Legal

Operations

Finance

Human Resources

Compliance

Risk Management

Business Development

Facility Management

Property Management

Contract Administration

Relevant Roles

Chief Executive Officer

Chief Operating Officer

Operations Director

Facility Manager

Property Manager

General Counsel

Legal Director

Contract Manager

Business Development Manager

Finance Director

Human Resources Director

Risk Manager

Compliance Officer

Asset Manager

Regional Manager

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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