Okay. He's going to hate you temporarily (hopefully it will go away) no matter how you do it, but PLEASE don't take him out to lunch and do it in a public place! Not only is that cruel (he can't react emotionally because of other people there) but it's excruciating! When's the best time to do it? First, then let's chow down? After he's had dessert? I mean, no matter what, either he's going to walk away and leave you there, or you're going to have to discuss this in detail, and who wants to have to eat (or who would have an APPETITE?) while that's happening?
Remember Ben Folds Five:
Wish I hadn't
Bought you dinner
Right before you
Dumped me on your front porch!
Don't do it, for the love of all that is merciful!
If you have to do it in public, please pick a park or open area where other people aren't crammed in at tables all around you. Pick a place that won't make him cry because it's where you had your first kiss or where he was planning to propose to you or the first place you ever made love in the dewy grass, or whatever. You get the idea.
Don't let him manipulate you into staying together just because you feel guilty.
Be kind to him and don't tread all over his ego. Take the high road and accept the blame, resisting all temptation to tell him that he's no good in bed or he's not trying hard enough or whatever. Lie if you have to.
Don't be afraid to walk away. Let him know how you feel, tell him you're sorry, let him emote if he wants to, let him yell, even (shocking news does this to some people), but at some point, realize it might be best to just walk away.
Don't say anything about being friends. None of "Let's just be friends" or "We can still be friends" or "You're still my best friend no matter what". Tell him so if you respect him or admire him or even love him, but the friends thing will either happen on it's own or it won't.
No breakup sex. BAD idea. Thus, breaking up in a public place.
And finally, DON'T FEEL TOO BAD! There are millions of wonderful people out there (I've dated a few!) but that doesn't mean they're perfect for YOU, even if they think they are. Breakups suck, but you can make them less sucky in retrospect if you do it correctly. Good luck! We'll be rooting for you. Be strong like bamboo, strong like willow.