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Management Fee Agreement for Germany

Management Fee Agreement Template for Germany

A Management Fee Agreement under German law is a contractual arrangement that establishes the terms and conditions for the provision of management services between a service provider and a recipient company. The agreement, governed by German civil and commercial law, outlines the scope of management services, fee structure, payment terms, and respective obligations of the parties. It incorporates specific requirements under German legislation, including the German Civil Code (BGB) and Commercial Code (HGB), while addressing tax implications and regulatory compliance. The document typically includes detailed provisions for service delivery, performance metrics, reporting requirements, and termination conditions.

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What is a Management Fee Agreement?

The Management Fee Agreement is essential for formalizing management service arrangements under German law, commonly used in corporate group structures, investment management relationships, and professional service arrangements. It details the scope of management services, fee calculations, payment terms, and service levels while ensuring compliance with German regulatory requirements, including the German Civil Code (BGB) and Commercial Code (HGB). This document is particularly crucial when establishing long-term management relationships, structuring group company services, or setting up investment management arrangements. The agreement should address key aspects such as service scope, performance metrics, reporting requirements, and regulatory compliance, while incorporating appropriate tax considerations and corporate governance standards under German law.

What sections should be included in a Management Fee Agreement?

1. Parties: Identification of the service provider (manager) and the recipient (company), including full legal names and addresses

2. Background: Context of the agreement, relationship between parties, and purpose of the management services

3. Definitions: Key terms used throughout the agreement, including 'Management Services', 'Fee Period', 'Performance Metrics', etc.

4. Scope of Services: Detailed description of management services to be provided

5. Management Fee Structure: Base fee, calculation method, payment terms, and frequency

6. Payment Terms: Invoicing details, payment deadlines, currency, and payment method

7. Obligations of the Manager: Key responsibilities, service standards, and performance requirements

8. Obligations of the Company: Company's duties, including information provision and cooperation

9. Term and Termination: Duration of agreement, renewal terms, and termination provisions

10. Confidentiality: Protection of confidential information and trade secrets

11. Liability and Indemnification: Limitation of liability, indemnification obligations, and insurance requirements

12. Force Majeure: Provisions for unforeseen circumstances affecting performance

13. Governing Law and Jurisdiction: Specification of German law application and jurisdiction for disputes

14. General Provisions: Standard clauses including severability, entire agreement, and amendments

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

1. Performance Metrics: Specific KPIs and performance measurement criteria - include when fee is performance-based

2. Variable Fee Components: Structure for success fees or performance-based compensation - include for complex fee arrangements

3. Intellectual Property Rights: IP ownership and licensing provisions - include when services involve creation of IP

4. Non-Competition: Restrictions on competitive activities - include when protecting market position

5. Data Protection: GDPR compliance measures - include when personal data processing is involved

6. Service Level Agreement: Detailed service standards and response times - include for technical or operational services

7. Regulatory Compliance: Specific regulatory obligations - include for regulated industries

8. Group Company Provisions: Extension of services to affiliates - include for corporate group structures

What schedules should be included in a Management Fee Agreement?

1. Schedule 1 - Scope of Services: Detailed breakdown of management services and deliverables

2. Schedule 2 - Fee Calculation: Detailed methodology for calculating management fees

3. Schedule 3 - Key Personnel: List of key management team members and their roles

4. Schedule 4 - Service Levels: Specific performance standards and metrics

5. Schedule 5 - Reporting Requirements: Ƶ and timing for required reports

6. Appendix A - Power of Attorney: If required for specific management actions

7. Appendix B - Company Group Structure: Overview of company group for scope definition

8. Appendix C - Compliance Guidelines: Specific compliance requirements and procedures

Authors

Alex Denne

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

Jurisdiction

Germany

Publisher

Ƶ

Document Type

Fee Agreement

Cost

Free to use

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