RESTAURANT MANAGEMENT AGREEMENT

THIS RESTAURANT MANAGEMENT AGREEMENT ("Agreement") is made and entered into as of this [____] day of [__________], 20[____], by and between:

OWNER:
Name: [________________________________]
Entity Type: ☐ Individual ☐ Corporation ☐ LLC ☐ Partnership
Address: [________________________________]
City: [________________] State: [____] ZIP: [________]
Phone: [________________________________]
Email: [________________________________]

MANAGER:
Company Name: [________________________________]
Entity Type: ☐ Corporation ☐ LLC ☐ Partnership
Address: [________________________________]
City: [________________] State: [____] ZIP: [________]
Phone: [________________________________]
Email: [________________________________]

RECITALS

WHEREAS, Owner owns and operates a restaurant known as:

Restaurant Name: [________________________________]
DBA (if different): [________________________________]
Location: [________________________________]
City: [________________] State: [____] ZIP: [________]

Restaurant Type: ☐ Full-Service ☐ Quick-Service ☐ Fast Casual ☐ Fine Dining ☐ Casual Dining ☐ Other: [________]

WHEREAS, Manager is in the business of providing professional restaurant management services; and

WHEREAS, Owner desires to engage Manager to manage the day-to-day operations of the Restaurant;

NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:

ARTICLE 1: ENGAGEMENT AND AUTHORITY

1.1 Engagement

Owner hereby engages Manager, and Manager hereby accepts engagement, to manage and operate the Restaurant in accordance with the terms of this Agreement.

1.2 Authority Granted

Owner grants Manager authority to:
☐ Hire, supervise, discipline, and terminate Restaurant employees
☐ Negotiate and execute contracts for supplies, services, and equipment up to $[________]
☐ Establish operating procedures and standards
☐ Set menu items and pricing (subject to Owner approval)
☐ Manage day-to-day financial operations
☐ Implement marketing and promotional activities
☐ Represent the Restaurant in dealings with vendors, customers, and regulatory agencies
☐ Make decisions necessary for ordinary course of business operations

1.3 Limitations on Authority

Manager shall NOT have authority to:
☐ Sell, lease, or encumber Restaurant assets or property
☐ Enter contracts exceeding $[________] without Owner approval
☐ Borrow money or obtain credit in Owner's name
☐ Modify or terminate the lease agreement
☐ Change the Restaurant concept without Owner approval
☐ Make capital expenditures exceeding $[________]
☐ Hire or terminate the General Manager without Owner consultation
☐ [________________________________]

1.4 Relationship

Manager is an independent contractor. Nothing in this Agreement creates an employer-employee, partnership, joint venture, or agency relationship (except as specifically authorized herein).

ARTICLE 2: TERM

2.1 Initial Term

Commencement Date: [__/__/____]
Initial Term: [____] years
Expiration Date: [__/__/____]

2.2 Renewal

☐ Automatic renewal for successive [____] year terms unless terminated
☐ Renewal requires mutual written agreement
☐ Notice of non-renewal required: [____] days before expiration

2.3 Early Termination

This Agreement may be terminated early as provided in Article 11.

ARTICLE 3: MANAGER'S DUTIES AND RESPONSIBILITIES

3.1 General Management

Manager shall:

Operations:
☐ Oversee all daily operations of the Restaurant
☐ Ensure Restaurant operates in compliance with all laws and regulations
☐ Maintain all required licenses and permits
☐ Establish and enforce operating procedures
☐ Maintain quality standards for food and service
☐ Handle customer complaints and issues
☐ Ensure compliance with health and safety regulations
☐ Coordinate with franchisors (if applicable)

Staffing:
☐ Recruit, hire, train, schedule, and supervise all employees
☐ Develop and maintain employee handbook and policies
☐ Ensure compliance with employment laws
☐ Process payroll and maintain payroll records
☐ Administer employee benefits programs
☐ Handle employee relations issues
☐ Maintain proper staffing levels

Financial Management:
☐ Prepare and manage operating budgets
☐ Control food, beverage, and labor costs
☐ Monitor and manage inventory
☐ Process accounts payable
☐ Manage cash handling procedures
☐ Prepare financial reports (see Section 4.5)
☐ Maintain books and records
☐ Coordinate with Owner's accountant

Purchasing:
☐ Source and negotiate with vendors
☐ Purchase food, beverages, and supplies
☐ Manage inventory levels and ordering
☐ Ensure quality of supplies and ingredients
☐ Maintain vendor relationships

Marketing and Sales:
☐ Develop and implement marketing strategies
☐ Manage social media presence
☐ Coordinate local advertising
☐ Plan and execute promotional events
☐ Manage customer loyalty programs
☐ Handle public relations

Maintenance:
☐ Oversee routine maintenance and repairs
☐ Manage relationships with maintenance contractors
☐ Report major repair needs to Owner
☐ Ensure equipment is properly maintained
☐ Maintain cleanliness and appearance of Restaurant

3.2 Compliance

Manager shall ensure compliance with:
☐ All federal, state, and local laws
☐ Health department regulations
☐ Fire safety codes
☐ ADA requirements
☐ Employment laws (wage/hour, discrimination, safety)
☐ Liquor licensing requirements (if applicable)
☐ Food safety regulations (FDA Food Code, HACCP)
☐ Franchise agreement requirements (if applicable)

3.3 Standards and Performance

Manager shall operate the Restaurant to achieve:

Quality Standards:
☐ Health inspection score of [____] or higher
☐ Customer satisfaction rating of [____] or higher
☐ Employee retention rate of [____]% or higher
☐ Food cost percentage of [____]% or less
☐ Labor cost percentage of [____]% or less
☐ [________________________________]

Performance Benchmarks:
☐ Revenue targets as set forth in annual budget
☐ Profit margin targets as set forth in annual budget
☐ Other KPIs: [________________________________]

3.4 Personnel

Manager shall assign the following personnel to the Restaurant:

Manager's Key Personnel Commitment: [________________________________]

ARTICLE 4: FINANCIAL ARRANGEMENTS

4.1 Management Fee Structure

☐ Option A: Percentage of Revenue
Base Management Fee: [____]% of Gross Revenue
Paid: ☐ Weekly ☐ Bi-weekly ☐ Monthly

☐ Option B: Flat Fee Plus Percentage
Base Fee: $[________] per month
Plus: [____]% of Gross Revenue over $[________]

☐ Option C: Flat Monthly Fee
Monthly Fee: $[________]
Annual Adjustment: ☐ CPI ☐ [____]% increase ☐ Negotiated

☐ Option D: Performance-Based
Base Fee: $[________] per month
Incentive Fee: [____]% of Net Operating Income above $[________]

4.2 Incentive Compensation

In addition to the Management Fee, Manager shall receive:

Revenue Incentive:
☐ [____]% bonus if annual revenue exceeds $[________]

Profitability Incentive:
☐ [____]% of Net Operating Income above $[________]
☐ [____]% of cost savings below budgeted expenses

Quality Incentive:
☐ $[________] bonus for maintaining health score of [____]+ for full year
☐ $[________] bonus for customer satisfaction rating of [____]+ for full year

4.3 Definition of Gross Revenue

"Gross Revenue" means all revenue from Restaurant operations, including:
☐ Food sales
☐ Beverage sales (alcoholic and non-alcoholic)
☐ Catering revenue
☐ Delivery and takeout revenue
☐ Merchandise sales
☐ Gift card sales (when sold/when redeemed)
☐ Private event revenue
☐ [________________________________]

Exclusions from Gross Revenue:
☐ Sales tax collected
☐ Tips and gratuities
☐ Refunds and chargebacks
☐ Employee meals
☐ Promotional/complimentary items
☐ [________________________________]

4.4 Operating Account

Bank: [________________________________]
Account Name: [________________________________]
Account Number: [________________________________]

Authorized Signers:
☐ Manager representatives: [________________________________]
☐ Owner representatives: [________________________________]
☐ Dual signature required for amounts over: $[________]

Operating Procedures:
☐ All revenue deposited daily
☐ Owner to maintain minimum balance of: $[________]
☐ Manager authorized to pay operating expenses from account
☐ Management fee paid [________________________________]

4.5 Financial Reporting

Manager shall provide Owner with:

Reports shall include:
☐ Revenue by category (food, beverage, etc.)
☐ Cost of goods sold analysis
☐ Labor cost analysis
☐ Operating expenses detail
☐ Variance analysis (actual vs. budget)
☐ Key performance indicators (KPIs)
☐ Accounts payable aging
☐ Inventory reports
☐ [________________________________]

4.6 Budget Process

Annual Budget:
☐ Manager shall prepare proposed annual budget by: [__/__]
☐ Owner shall approve or request modifications within: [____] days
☐ Approved budget shall be the operating plan for the year

Budget Variances:
☐ Manager may exceed budget line items by up to [____]% without approval
☐ Total budget variance not to exceed [____]% without Owner approval
☐ Capital expenditures require separate approval

ARTICLE 5: OWNER'S RESPONSIBILITIES

5.1 Owner Shall Provide

☐ Restaurant premises and lease
☐ Initial inventory and supplies
☐ All furniture, fixtures, and equipment
☐ Initial working capital of: $[________]
☐ Ongoing working capital as needed
☐ Liquor license (held in Owner's name)
☐ Insurance coverage (see Article 7)
☐ Access to premises and systems
☐ Franchise rights and materials (if applicable)

5.2 Owner's Ongoing Obligations

☐ Maintain lease in good standing
☐ Pay rent and property expenses
☐ Fund capital improvements and major repairs
☐ Maintain required insurance
☐ Approve annual budgets timely
☐ Review and respond to Manager reports
☐ Maintain licenses requiring Owner signature

5.3 Owner's Reserved Rights

Owner reserves the right to:
☐ Approve annual budgets and major variances
☐ Approve contracts over $[________]
☐ Approve menu changes
☐ Approve significant operational changes
☐ Inspect Restaurant and records at any time
☐ Approve hiring/termination of General Manager
☐ Make decisions regarding Restaurant concept
☐ [________________________________]

ARTICLE 6: EMPLOYEES

6.1 Employment Status

Restaurant employees shall be employed by:
☐ Owner (Manager provides management services only)
☐ Manager (Manager is employer of record)
☐ Joint Employment Arrangement: [________________________________]

6.2 If Owner is Employer

Owner shall:
☐ Be employer of record for all Restaurant employees
☐ Maintain workers' compensation insurance
☐ Be responsible for payroll taxes
☐ Provide employee benefits
☐ Remain legally responsible for employment decisions

Manager shall:
☐ Make day-to-day employment decisions
☐ Process payroll on Owner's behalf
☐ Ensure compliance with employment laws
☐ Maintain personnel files

6.3 If Manager is Employer

Manager shall:
☐ Employ all Restaurant staff as Manager's employees
☐ Maintain workers' compensation insurance
☐ Be responsible for payroll taxes
☐ Provide employee benefits (or reimburse by Owner)
☐ Assume liability for employment matters

Manager's labor costs shall be:
☐ Reimbursed by Owner as operating expense
☐ Included in Management Fee
☐ [________________________________]

6.4 Key Employee Provisions

☐ General Manager must be approved by Owner
☐ Owner may require replacement of General Manager for cause
☐ [____] days notice required for General Manager change
☐ Non-compete provisions apply to: [________________________________]

ARTICLE 7: INSURANCE

7.1 Owner's Insurance

Owner shall maintain:
☐ Property Insurance (building and contents): $[________]
☐ Business Interruption Insurance: [____] months coverage
☐ General Liability: $[________] per occurrence
☐ Liquor Liability (if applicable): $[________]
☐ Umbrella/Excess Liability: $[________]

7.2 Manager's Insurance

Manager shall maintain:
☐ Professional Liability/E&O: $[________]
☐ General Liability: $[________]
☐ Workers' Compensation: As required (if Manager is employer)
☐ Fidelity Bond: $[________]
☐ Cyber Liability: $[________]

7.3 Additional Insureds

☐ Owner named as additional insured on Manager's liability policies
☐ Manager named as additional insured on Owner's liability policies

7.4 Certificate of Insurance

Each party shall provide certificate of insurance:
☐ Upon execution of Agreement
☐ Upon each policy renewal
☐ Upon request

ARTICLE 8: BOOKS, RECORDS, AND AUDITS

8.1 Books and Records

Manager shall maintain complete and accurate books and records including:
☐ Daily sales records
☐ Cash handling records
☐ Inventory records
☐ Purchase orders and invoices
☐ Payroll records
☐ Employee files
☐ Vendor contracts
☐ Tax records
☐ All financial documentation

8.2 Record Retention

Records shall be maintained for:
☐ Tax records: [____] years
☐ Employment records: [____] years
☐ Financial records: [____] years
☐ Contracts: [____] years after expiration

8.3 Owner Access

Owner shall have the right to:
☐ Access all books and records at any time
☐ Copy any records
☐ Conduct audits at Owner's expense
☐ Have accountant review records

8.4 Audits

☐ Owner may conduct audit with [____] days notice
☐ If audit reveals discrepancy of more than [____]%, Manager pays audit costs
☐ Annual audit required: ☐ Yes ☐ No
☐ Audit conducted by: [________________________________]

ARTICLE 9: INTELLECTUAL PROPERTY

9.1 Owner's Property

The following remain Owner's exclusive property:
☐ Restaurant name and trademarks
☐ Recipes and menu items
☐ Customer lists and data
☐ Operating procedures developed for the Restaurant
☐ Marketing materials specific to the Restaurant
☐ All goodwill associated with the Restaurant
☐ Franchise rights (if applicable)

9.2 Manager's Property

The following remain Manager's exclusive property:
☐ Manager's proprietary management systems
☐ Manager's training materials and programs
☐ Manager's corporate name and trademarks
☐ Manager's general business procedures

9.3 Work Product

Any materials, procedures, or intellectual property created by Manager specifically for the Restaurant shall:
☐ Belong to Owner
☐ Be licensed to Owner for the Restaurant only
☐ Be jointly owned

ARTICLE 10: CONFIDENTIALITY AND NON-COMPETE

10.1 Confidential Information

Both parties agree to maintain confidentiality of:
☐ Financial information
☐ Customer data
☐ Trade secrets and recipes
☐ Business strategies
☐ Employee information
☐ Proprietary systems and procedures

10.2 Manager's Non-Compete

During the term and for [____] years after termination, Manager shall not:
☐ Manage a competing restaurant within [____] miles
☐ Solicit Restaurant employees
☐ Solicit Restaurant customers
☐ Disclose confidential information

Exceptions:
☐ Other restaurants currently managed by Manager
☐ Restaurants approved in writing by Owner
☐ [________________________________]

10.3 Non-Solicitation

For [____] years after termination:
☐ Manager shall not solicit Restaurant employees
☐ Manager shall not solicit Restaurant customers
☐ Owner shall not solicit Manager's corporate employees

ARTICLE 11: TERMINATION

11.1 Termination for Cause by Owner

Owner may terminate immediately upon:
☐ Material breach not cured within [____] days of notice
☐ Fraud, theft, or dishonesty by Manager
☐ Gross negligence in management
☐ Loss of required licenses due to Manager's actions
☐ Health department closure due to Manager's negligence
☐ Bankruptcy or insolvency of Manager
☐ Criminal conviction of Manager or key personnel
☐ Failure to meet performance standards for [____] consecutive periods

11.2 Termination for Cause by Manager

Manager may terminate upon:
☐ Owner's failure to pay fees for [____] days after due
☐ Owner's material breach not cured within [____] days
☐ Owner's failure to fund working capital
☐ Owner's interference with Manager's authority
☐ Sale of Restaurant to third party
☐ Bankruptcy or insolvency of Owner

11.3 Termination Without Cause

☐ Either party may terminate with [____] days written notice
☐ Termination fee: $[________] or [____] months' management fee

11.4 Effect of Termination

Upon termination:
☐ Manager shall deliver all books, records, and property to Owner
☐ Manager shall cooperate with transition
☐ Owner shall pay all earned fees through termination date
☐ Manager shall return all keys, access codes, and passwords
☐ Confidentiality obligations continue
☐ Non-compete obligations continue (if applicable)

11.5 Transition Period

☐ Manager shall provide transition assistance for [____] days after termination
☐ Transition assistance: ☐ Included ☐ Additional fee: $[________]

ARTICLE 12: INDEMNIFICATION

12.1 Manager's Indemnification

Manager shall indemnify Owner against claims arising from:
☐ Manager's negligence or willful misconduct
☐ Manager's breach of this Agreement
☐ Manager's violation of law
☐ Employment claims (if Manager is employer)
☐ Manager's unauthorized actions

12.2 Owner's Indemnification

Owner shall indemnify Manager against claims arising from:
☐ Owner's negligence
☐ Owner's breach of this Agreement
☐ Premises defects
☐ Employment claims (if Owner is employer)
☐ Matters occurring before Manager's engagement

12.3 Limitation of Liability

☐ Neither party liable for consequential, incidental, or punitive damages
☐ Manager's liability limited to: [____] times annual management fee
☐ [________________________________]

ARTICLE 13: DISPUTE RESOLUTION

13.1 Governing Law

This Agreement shall be governed by the laws of the State of [________________].

13.2 Dispute Resolution

☐ Good faith negotiation for [____] days
☐ Mediation before litigation/arbitration
☐ Binding arbitration under AAA Commercial Rules
☐ Litigation in [________________] County courts

13.3 Attorneys' Fees

Prevailing party entitled to recover reasonable attorneys' fees.

13.4 Continued Performance

During any dispute, both parties shall continue to perform obligations (except payment of disputed amounts, which may be held in escrow).

ARTICLE 14: MISCELLANEOUS

14.1 Notices

All notices shall be in writing sent to addresses above by certified mail, overnight courier, or email with confirmation.

14.2 Assignment

Manager may not assign without Owner's consent. Owner may assign with notice to Manager.

14.3 Entire Agreement

This Agreement and Exhibits constitute the entire agreement.

14.4 Amendments

Amendments must be in writing signed by both parties.

14.5 Severability

Invalid provisions shall not affect remaining provisions.

14.6 Waiver

Failure to enforce any provision shall not constitute waiver.

14.7 Force Majeure

Neither party liable for delays due to circumstances beyond reasonable control.

14.8 Counterparts

May be executed in counterparts.

EXHIBITS

☐ Exhibit A - Restaurant Description and Inventory
☐ Exhibit B - Initial Operating Budget
☐ Exhibit C - Performance Standards and KPIs
☐ Exhibit D - Key Personnel
☐ Exhibit E - Approved Vendors List
☐ Exhibit F - Reporting Templates
☐ Exhibit G - [________________________________]

SIGNATURES

OWNER:

Signature: ________________________________
Printed Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

MANAGER:

Signature: ________________________________
Printed Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

This template is for informational purposes only. Restaurant management agreements involve complex operational, financial, and liability considerations. Both owners and managers should consult with qualified hospitality attorneys before signing.