The Hotel Management Contract Agreement is a crucial document used when a property owner seeks to engage a professional hotel management company to operate their hotel property in the Philippines. This agreement is essential for defining the business relationship between the owner and operator, typically used for new hotel developments or when transitioning existing properties to professional management. The document must comply with Philippine regulations, particularly the Tourism Act of 2009 and related hospitality industry regulations, while addressing key aspects such as operational standards, financial arrangements, employment matters, and risk allocation. It includes detailed provisions for brand standards, management fees, operational responsibilities, and termination conditions, forming the foundation for a long-term business relationship in hotel operations.
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1. Parties: Identifies the hotel owner and the hotel management company, including their legal status and registered addresses
2. Background: Outlines the context of the agreement, including property details and the parties' intentions
3. Definitions: Defines key terms used throughout the agreement
4. Appointment and Term: Specifies the appointment of the manager, term length, and any renewal options
5. Manager's Rights and Responsibilities: Details the scope of authority and duties of the hotel management company
6. Owner's Rights and Obligations: Outlines the owner's responsibilities and retained rights
7. Operating Standards: Establishes the brand standards and quality requirements for hotel operation
8. Staff and Employment: Addresses employment matters, including hiring, training, and labor relations
9. Budgets and Financial Management: Details financial planning, reporting requirements, and accounting procedures
10. Fees and Payments: Specifies all management fees, including base fees, incentive fees, and payment terms
11. Insurance and Indemnification: Outlines required insurance coverage and mutual indemnification provisions
12. Termination: Details circumstances allowing termination and the consequences thereof
13. Post-Termination Obligations: Specifies obligations and transitions upon contract end
14. Intellectual Property: Addresses usage of brands, trademarks, and proprietary systems
15. Governing Law and Dispute Resolution: Specifies applicable law and methods for resolving disputes
16. Miscellaneous Provisions: Includes standard boilerplate clauses such as force majeure, notices, and amendments
1. Pre-Opening Services: Used when the hotel is not yet operational, detailing services provided before opening
2. Technical Services: Include when the manager provides additional technical assistance or consulting
3. FF&E and Capital Expenditure: Detailed section when significant renovations or upgrades are planned
4. Non-Compete Provisions: Used when restricting the manager's ability to operate competing properties
5. Mixed-Use Property Provisions: Include when the hotel is part of a larger mixed-use development
6. Casino/Gaming Operations: Required when the property includes gaming facilities
7. Residential Component: Include when the property includes residential units or serviced apartments
8. Force Majeure Extension: Enhanced force majeure provisions for high-risk locations or specific concerns
9. Environmental Compliance: Detailed environmental provisions for properties in environmentally sensitive areas
10. Local Partner Provisions: Include when local ownership requirements necessitate additional parties
1. Property Description: Detailed description of the hotel property, including legal description and facilities
2. Brand Standards Manual: Comprehensive outline of required operational and quality standards
3. Initial Budget: First year's operating budget and financial projections
4. FF&E Requirements: Specifications for furniture, fixtures, and equipment
5. Key Performance Indicators: Specific performance metrics and targets
6. Employee Positions and Organization Chart: Detailed staffing structure and key positions
7. Required Insurance Coverage: Specific insurance types and minimum coverage amounts
8. Pre-Opening Budget and Timeline: If applicable, detailed pre-opening costs and schedule
9. Technical Services Scope: Detailed scope of technical services if provided
10. Centralized Services: List and description of centralized services provided by manager
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