Obligations and Political Commitment
- The grantee must accept in writing the condition not to engage in or support propaganda against US government policies regarding the Philippines, based on messages exchanged in 1913.
- This commitment extends to administrators, agents, successors, and assigns.
Standards for Installation and Service
- Poles must be at least 20 feet high, aesthetically acceptable, and placed for public safety per a municipal-approved plan.
- The grantee must supply power to any applicant within 15 days, respecting order of application and capacity limits.
- Plant capacity must increase with demand, authorized by the municipal council.
- Service connection points are limited to 30 meters from the lines.
Equipment Standards and Undergrounding
- All equipment must be modern and first class; wires must be insulated and secure to avoid ground contact.
- Wires should not obstruct public thoroughfares.
- The grantee must comply with any legislative requirement to place wires underground at their expense.
Restoration and Relocation of Public Property
- The grantee must restore any pavement or sidewalks disturbed during pole installation.
- Poles must be relocated if required by municipal council decisions, at the grantee’s expense.
Cooperation with Municipal Work and Costs
- The grantee must remove or raise poles/wires obstructing municipal works or building removal upon 48-hour notice.
- The requester of such work pays half the cost of these adjustments.
- Non-compliance can lead to municipal intervention, with appeal rights to the provincial board.
Liability for Accidents
- The grantee is liable for injuries or damages caused by construction or failure to maintain poles and wires safely.
Acceptance, Commencement, and Payments
- Franchise acceptance must be filed within 120 days after securing the public necessity certificate.
- Work must commence within 6 months and the system must be operational within 18 months, unless delayed by force majeure or similar causes.
- Quarterly payments to the municipality: 1% of gross earnings for the first 20 years, 2% for the last 30 years.
Security Deposit and Forfeiture Conditions
- A deposit of 1,000 pesos or approved securities must be made as a good faith guarantee.
- Failure to commence work or be ready within stipulated periods results in forfeiture of deposit to the municipality.
- Delays caused by force majeure extend allowed time frames.
Municipal Use of Poles
- Guinobatan municipality may use the poles without compensation for telephone or fire/police alarm systems.
- Such wires must not interfere or damage the grantee’s electric system.
Amendment, Ownership, and Reversion
- The franchise is subject to amendment, repeal, or limitation by the U.S. Congress or Philippine Legislature.
- Upon franchise termination, lands and rights revert to original government owners.
- All franchise property becomes Insular Government property upon termination.
Restrictions on Issuance of Securities
- The grantee may issue stock or bonds only for cash or property at fair value, with prior Public Utility Commission approval.
- Dividend issuance of stock or bonds is prohibited.
Accounting and Taxation
- Books are open to inspection by provincial treasurer; quarterly reports on gross and net receipts must be submitted.
- The grantee pays taxes on property and equipment like other taxpayers.
Transfer and Succession
- The franchise may be sold, leased, or assigned with prior Public Utility Commission approval.
- The transferee must accept all franchise terms and conditions in writing.
Forfeiture Process
- The municipal council can declare forfeiture for non-compliance after hearing the grantee, with Secretary of Commerce and Communications approval.
- The grantee has 60 days to seek judicial relief; failure to apply waives appeal rights.
Purchase Option by Government
- After 20 years, the government or political subdivision may purchase all plant and property at valuation based on net earnings.
- Valuation is determined by the Supreme Court sitting as arbitrators; their decision is final.
Definition of "Grantee"
- Refers to Engracio Orense and his representatives, successors, and assigns.