Exhibit 10.3


 


GUARANTY


This GUARANTY, dated as
of June 30, 2006, by and among the Guarantors identified as such on the
signature pages hereof (each individually, a “Guarantor” and, collectively, the
“Guarantors”), in favor of BANK OF AMERICA, N.A., a national banking
association, as administrative agent (hereinafter, in such capacity, the “Administrative
Agent”) for itself and the other lending institutions (hereinafter,
collectively, the “Lenders”) which are or may become parties to that certain
Credit Agreement, dated as of June 30, 2006 (as amended, modified,
supplemented, or restated and in effect from time to time, the “Credit
Agreement”), among InfraSource Incorporated, a Delaware corporation (the “Borrower”),
InfraSource Services, Inc. (“Holdings”), the Lenders and the Administrative
Agent.


WHEREAS,
the Borrower, Holdings and the Guarantors are members of a group of related
Persons, the success of any one of which is dependent in part on the success of
the other members of such group;


WHEREAS, each Guarantor
expects to receive substantial direct and indirect benefits from the extensions
of credit to the Borrower by the Lenders pursuant to the Credit Agreement
(which benefits are hereby acknowledged);


WHEREAS, it is a
condition precedent to the Lenders’ making any loans or otherwise
extending credit to the Borrower under the Credit Agreement that each
Guarantor executes and delivers to the Administrative Agent, for the benefit of
the Lenders and the Administrative Agent, a guaranty substantially in the form
hereof; and


WHEREAS, each Guarantor
wishes to guaranty the Borrower’s obligations to the Lenders and the
Administrative Agent under or in respect of the Credit Agreement as provided
herein;


NOW, THEREFORE, in
consideration of the premises contained herein and for other good and valuable
consideration, the receipt of which is hereby acknowledged, each Guarantor,
intending to be legally bound, hereby agrees with the Lenders and the
Administrative Agent as follows:


1.                                      Definitions 
The term “Obligations” and all other capitalized terms used herein
without definition shall have the respective meanings provided therefor in the
Credit Agreement.


2.                                      Guaranty of Payment and
Performance.  Each Guarantor hereby jointly and severally
unconditionally guarantees to the Lenders and the Administrative Agent the full
and punctual payment when due (whether at stated maturity, by required
pre-payment, by acceleration or otherwise), as well as the performance, of all
of the Obligations, including all such which would become due but for the
operation of the automatic stay pursuant to §362(a) of the Bankruptcy Code of
the United States and the operation of §§502(b) and 506(b) of the Bankruptcy
Code of the United States.  This Guaranty
is an absolute, unconditional and continuing guaranty of the full and punctual
payment and performance of all of the Obligations and not of their
collectibility only and is in no way conditioned upon any requirement that the
Administrative Agent or any Lender first attempt to collect any of the Obligations
from the 


 


 

















Borrower or resort to any collateral security or other
means of obtaining payment.  Should the
Borrower default in the payment or performance of any of the Obligations, the
obligations of the Guarantors hereunder with respect to such Obligations in
default shall, upon demand by the Administrative Agent, become immediately due
and payable to the Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, without demand or notice of any nature, all of which are expressly
waived by each Guarantor.  Payments by
each Guarantor hereunder may be required by the Administrative Agent on any
number of occasions.  All payments by any
Guarantor hereunder shall be made to the Administrative Agent, in the manner
and at the place of payment specified therefor in the Credit Agreement, for the
account of the Lenders and the Administrative Agent.


Notwithstanding any
provision to the contrary contained herein or in any other of the Loan
Documents or Swap Contracts, the obligations of each Guarantor under this
Guaranty and the other Loan Documents shall be limited to an aggregate amount
equal to the largest amount that would not render such obligations subject to
avoidance under the Debtor Relief Laws or any comparable provisions of any
applicable state law.


3.                                      Guarantors’ Agreement to
Pay Enforcement Costs, etc.  Each
Guarantor further jointly and severally agrees, as the principal obligor and
not as a guarantor only, to pay to the Administrative Agent, on demand, all
costs and expenses (including court costs and reasonable legal expenses)
incurred or expended by the Administrative Agent or any Lender in connection
with the Obligations, this Guaranty and the enforcement thereof, together with
interest on amounts recoverable under this Section 3 from the time when such
amounts become due until payment, whether before or after judgment, at the rate
of interest for overdue principal set forth in the Credit Agreement, provided
that if such interest exceeds the maximum amount permitted to be paid under
applicable law, then such interest shall be reduced to such maximum permitted
amount.


4.                                      Waivers by Guarantors;
Lenders’ Freedom to Act.  Each
Guarantor agrees that the Obligations will be paid and performed strictly in
accordance with their respective terms, regardless of any law, regulation or
order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Administrative Agent or any Lender with respect thereto. 
Each Guarantor waives promptness, diligence, presentment, demand,
protest, notice of acceptance, notice of any Obligations incurred and all other
notices of any kind, all defenses which may be available by virtue of any
valuation, stay, moratorium law or other similar law now or hereafter in effect,
any right to require the marshalling of assets of the Borrower or any other
entity or other person primarily or secondarily liable with respect to any of
the Obligations, and all suretyship defenses generally.  Without limiting the generality of the foregoing,
each Guarantor agrees to the provisions of any instrument evidencing, securing
or otherwise executed in connection with any Obligation and agrees that the
obligations of each Guarantor hereunder shall not be released or discharged, in
whole or in part, by (i) the failure of the Administrative Agent or any Lender to assert any claim or demand
or to enforce any right or remedy against the Borrower or any other entity or
other person primarily or secondarily liable with respect to any of the
Obligations; (ii) any extensions, compromise, refinancing, consolidation or
renewals of any Obligation; (iii) any change in the time, place or manner of
payment of any of the Obligations or any rescissions, waivers, compromise,
refinancing, consolidation or other 


 


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amendments or modifications of any of the terms or
provisions of the Credit Agreement,
the Notes, the other Loan Documents or any
other agreement evidencing, securing or otherwise executed in connection with
any of the Obligations, (iv) the addition, substitution or release of any
entity or other person primarily or secondarily liable for any Obligation; (v)
the adequacy of any rights which the Administrative Agent or any Lender may
have against any collateral security or other means of obtaining repayment of
any of the Obligations; (vi) the impairment of any collateral securing any of
the Obligations, including without limitation the failure to perfect or
preserve any rights which the Administrative Agent or any Lender might have in
such collateral security or the substitution, exchange, surrender, release,
loss or destruction of any such collateral security; or (vii) any other act or
omission which might in any manner or to any extent vary the risk of any Guarantor
or otherwise operate as a release or discharge of any Guarantor, all of which
may be done without notice to the Guarantors. 
To the fullest extent permitted by law, each Guarantor hereby expressly
waives any and all rights or defenses arising by reason of (A) any “one action”
or “anti-deficiency” law which would otherwise prevent the Administrative Agent
or any Lender from bringing any action, including any claim for a deficiency,
or exercising any other right or remedy (including any right of set-off),
against any Guarantor before or after the Administrative Agent’s or such Lender’s
commencement or completion of any foreclosure action, whether judicially, by
exercise of power of sale or otherwise, or (B) any other law which in any other
way would otherwise require any election of remedies by the Administrative
Agent or any Lender.


5.                                      Unenforceability of
Obligations Against Borrower.  If for any
reason the Borrower has no legal
existence or is under no legal obligation to discharge any of the Obligations,
or if any of the Obligations have become irrecoverable from the Borrower by reason of the Borrower’s
insolvency, bankruptcy or reorganization or by other operation of law or for
any other reason, this Guaranty shall nevertheless be binding on each Guarantor
to the same extent as if such Guarantor at all times had been the principal
obligor on all such Obligations, subject to any limitations set forth
herein.  In the event that acceleration
of the time for payment of any of the Obligations is stayed upon the
insolvency, bankruptcy or reorganization of the Borrower, or for any other
reason, all such amounts otherwise subject to acceleration under the terms of
the Credit Agreement, the Notes, the
other Loan Documents or any other agreement evidencing, securing or
otherwise executed in connection with any Obligation shall be immediately due
and payable by the Guarantors.


6.                                      Subrogation; Subordination.


6.1.                            Waiver of Rights Against
Borrower.  Until the final payment and performance in
full of all of the Obligations, (A) no Guarantor shall exercise any rights
against the Borrower arising as
a result of payment by such Guarantor hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and will not prove any
claim in competition with the Administrative Agent or any Lender in respect of
any payment hereunder in any bankruptcy, insolvency or reorganization case or
proceedings of any nature; (B) no Guarantor will claim any setoff, recoupment
or counterclaim against the Borrower in respect of any liability of such
Guarantor to the Borrower; and (C) each Guarantor postpones and subordinates
any benefit of and any right to participate in any collateral security which
may be held by the Administrative Agent or any Lender.


 


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6.2.                            Subordination.  The payment of
any amounts due with respect to any indebtedness of the Borrower for money
borrowed or credit received now or hereafter owed to any Guarantor is hereby
subordinated to the prior payment in full of all of the Obligations.  Each Guarantor agrees that, after the
occurrence of any Default in the payment or performance of any of the
Obligations, such Guarantor will not demand, sue for or otherwise attempt to
collect any such indebtedness of the Borrower to such Guarantor until all of
the Obligations shall have been paid in full in cash or until such Default is
cured or waived in accordance with the terms and conditions of the Loan
Documents.  If, notwithstanding the
foregoing sentence, any Guarantor shall collect, enforce or receive any amounts
in respect of such indebtedness while any Obligations are still outstanding,
such amounts shall be collected, enforced and received by such Guarantor as
trustee for the Lenders and the Administrative Agent and be paid over to the
Administrative Agent, for the benefit of the Lenders and the Administrative
Agent, on account of the Obligations without affecting in any manner the
liability of any Guarantor under the other provisions of this Guaranty.


6.3.                            Provisions Supplemental.  The provisions
of this Section 6 shall be supplemental to and not in derogation of any rights
and remedies of the Lenders and the Administrative Agent under any separate
subordination agreement which the Administrative Agent may at any time and from
time to time enter into with any Guarantor for the benefit of the Lenders and
the Administrative Agent.


7.                                      Security; Setoff.  Each Guarantor
grants to each of the Administrative Agent and the Lenders, as security for the
full and punctual payment and performance of all of such Guarantor’s
obligations hereunder, a continuing lien on and security interest in all
securities or other property belonging to such Guarantor now or hereafter held
by the Administrative Agent or such Lender and in all deposits (general or
special, time or demand, provisional or final) and other sums credited by or
due from the Administrative Agent or such Lender to such Guarantor or subject
to withdrawal by such Guarantor.  Regardless
of the adequacy of any collateral security or other means of obtaining payment
of any of the Obligations, each of the Administrative Agent and the Lenders is
hereby authorized at any time and from time to time, without notice to any
Guarantor (any such notice being expressly waived by each Guarantor) and to the
fullest extent permitted by law, to set off and apply such deposits and other
sums against the obligations of such Guarantor under this Guaranty, whether or
not the Administrative Agent or such Lender shall have made any demand under
this Guaranty and although such obligations may be
contingent or unmatured.


8.                                      Further Assurances.  Each Guarantor
agrees that it will from time to time, at the request of the Administrative
Agent, do all such things and execute all such documents as the Administrative
Agent may consider necessary or desirable to give full effect to this Guaranty
and to perfect and preserve the rights and powers of the Lenders and the
Administrative Agent hereunder.  Each
Guarantor acknowledges and confirms that such Guarantor itself has established
its own adequate means of obtaining from the Borrower on a continuing basis all
information desired by such Guarantor concerning the financial condition of the
Borrower and that such Guarantor will look to the Borrower and not to the
Administrative Agent or any Lender 


 


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in order for such Guarantor to keep adequately
informed of changes in the Borrower’s financial condition.


9.                                      Covenants under Credit
Agreement.  Each Guarantor acknowledges that a
Responsible Officer of such Guarantor has read a copy of each of the Loan
Documents and agrees to perform and comply with all of the obligations,
covenants and agreements in the Loan Documents that are applicable to it.


10.                               Effectiveness; Reinstatement.  This Guaranty
shall remain in full force and effect until the Obligations have been paid and
performed in full in cash and all credit commitments of the Administrative
Agent and the Lenders in respect thereof (including all outstanding Letters of
Credit) have terminated.  This Guaranty
shall continue to be effective or be reinstated, notwithstanding any
termination, if at any time any payment made or value received with respect to
any Obligation is rescinded or must otherwise be returned by the Administrative
Agent or any Lender upon the insolvency, bankruptcy or reorganization of the
Borrower, or otherwise, all as though such payment had not been made or value
received.


11.                               Successors and Assigns.  This Guaranty
shall be binding upon each Guarantor, its respective successors and assigns,
and shall inure to the benefit of the Administrative Agent and the Lenders and
their respective successors, transferees and assigns.  Without limiting the generality of the
foregoing sentence, each Lender may assign or otherwise transfer the Credit
Agreement, the Notes, the other Loan
Documents or any other agreement or note held by it evidencing, securing
or otherwise executed in connection with the Obligations, or sell
participations in any interest therein, to any other entity or other person,
and such other entity or other person shall thereupon become vested, to the
extent set forth in the agreement evidencing such assignment, transfer or
participation, with all the rights in respect thereof granted to such Lender
herein, all in accordance with Section 11.06 of the Credit Agreement.  No Guarantor may assign any of its
obligations hereunder.


12.                               Amendments and Waivers.  No amendment
or waiver of any provision of this Guaranty nor consent to any departure by the
Guarantor therefrom shall be effective unless the same shall be in writing and
signed by the Administrative Agent in accordance with Section 11.01 of the
Credit Agreement.  No failure on the part
of the Administrative Agent or any Lender to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any right hereunder preclude any other or
further exercise thereof or the exercise of any other right.


13.                               Notices.  All notices and
other communications called for hereunder shall be made in writing and, unless
otherwise specifically provided herein, shall be deemed to have been duly made
or given when delivered by hand or mailed first class, postage prepaid, or, in
the case of telegraphic or telexed notice, when transmitted, answer back
received, addressed as follows:  if to
any Guarantor, at the address set forth beneath its signature hereto, and if to
the Administrative Agent, at the address for notices to the Administrative
Agent set forth in Section 11.02 of the Credit Agreement, or at such address as
either party may designate in writing to the other.


 


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14.                               Governing Law; Consent to
Jurisdiction.  THIS
GUARANTY IS INTENDED TO TAKE EFFECT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.  Each Guarantor agrees that any suit for the
enforcement of this Guaranty may be brought in the courts of the Commonwealth
of Pennsylvania sitting in Philadelphia County and of the United States
District Court of the Eastern District of Pennsylvania and consents to the
nonexclusive jurisdiction of such court and to service of process in any such
suit being made upon the Guarantor by mail at the address specified by
reference in Section 13.  Each Guarantor
hereby waives any objection that it may now or hereafter have to the venue of
any such suit or any such court or that such suit was brought in an inconvenient
court.


15.                               Waiver of Jury Trial.  EACH GUARANTOR AND THE ADMINISTRATIVE AGENT FOR ITSELF
AND THE LENDERS HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY
ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS GUARANTY,
ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY OF SUCH RIGHTS OR
OBLIGATIONS.  Except as
prohibited by law, each Guarantor and the Administrative Agent for itself and
the Lenders hereby waives any right which it may have to claim or recover in
any litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages.  Each Guarantor (i)
certifies that neither the Administrative Agent or any Lender nor any representative,
agent or attorney of the Administrative Agent or any Lender has represented,
expressly or otherwise, that the Administrative Agent or any Lender would not,
in the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that, in entering into the Credit Agreement and the other Loan
Documents to which the Administrative Agent or any Lender is a party, the
Administrative Agent and the Lenders are relying upon, among other things, the
waivers and certifications contained in this Section 15.


16.                               Miscellaneous.  This Guaranty
constitutes the entire agreement of each Guarantor with respect to the matters
set forth herein.  The rights and
remedies herein provided are cumulative and not exclusive of any remedies
provided by law or any other agreement, and this Guaranty shall be in addition
to any other guaranty of or collateral security for any of the
Obligations.  The invalidity or
unenforceability of any one or more sections of this Guaranty shall not affect
the validity or enforceability of its remaining provisions.  Captions are for the ease of reference only
and shall not affect the meaning of the relevant provisions.  The meanings of all defined terms used in
this Guaranty shall be equally applicable to the singular and plural forms of
the terms defined.


17.                               Contribution. 
To the extent any Guarantor makes a payment hereunder in excess of the
aggregate amount of the benefit received by such Guarantor in respect of the
extensions of credit under the Credit Agreement (the “Benefit Amount”), then such Guarantor, after the final and
undefeasible payment in full, in cash, of all of the Obligations, shall be
entitled to recover from each other guarantor of the Obligations such excess
payment, pro rata, in accordance with the
ratio of the Benefit Amount received by each such other guarantor to the total
Benefit Amount received by all guarantors of the Obligations, and the right to
such recovery shall be deemed to be an asset and property of such Guarantor so
funding.


 


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IN WITNESS
WHEREOF, each
Guarantor has caused this Guaranty to be executed and delivered as of the date
first above written.


 


INFRASOURCE UNDERGROUND SERVICES, INC.


CHOWNS, INC.


TRINITY INDUSTRIES, INC.


INFRASOURCE CORPORATE SERVICES, INC.


OSP CONSULTANTS, INC.


BLAIR PARK SERVICES, INC.


UTILITY LOCATE AND MAPPING SERVICES, INC.


M.J. ELECTRIC, INC.


DASHIELL HOLDINGS CORPORATION


INFRASOURCE TRANSMISSION SERVICES COMPANY


INFRASOURCE UNDERGROUND CONSTRUCTION, INC.


INFRASOURCE MID-ATLANTIC, INC.


INFRASOURCE UNDERGROUND CONSTRUCTION CALIFORNIA,
INC.


INFRASOURCE UNDERGROUND SERVICE CANADA, INC.


INFRASOURCE POWER CALIFORNIA, INC.


INFRASOURCE MASLONKA CA, INC.


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


INFRASOURCE UNDERGROUND CONSTRUCTION SERVICES, LLC


INFRASOURCE UNDERGROUND INSTALLATION, LLC


INFRASOURCE POWER, LLC


INFRASOURCE UNDERGROUND CONSTRUCTION, LLC


INFRASOURCE CONCRETE & PAVING SERVICES, LLC


IUC IOWA, LLC


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


INFRASOURCE TEXAS HOLDINGS GP LLC


INFRASOURCE TEXAS HOLDINGS LP LLC


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


 


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DASHIELL LTD.


 


                By:          INFRASOURCE TEXAS HOLDINGS GP LLC, its
general partner


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


DACON GP LLC


 


                By:          DASHIELL LTD., its sole member


                                By:          INFRASOURCE TEXAS HOLDINGS GP LLC, its
general partner


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


DACON LTD.


 


                By:          DACON GP LLC, its general partner


                                By:          DASHIELL LTD., its sole member


                                                By:          INFRASOURCE TEXAS HOLDINGS GP LLC, its
general partner


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


INFRASOURCE-MASLONKA, LLC


 


	
  By:

  	
  /s/ Terence R. Montgomery

  	
   

  
	
   

  	
  Name: Terence R. Montgomery

  	
   

  
	
   

  	
  Title: Senior Vice President and Treasurer

  	
   

  



 


Address:                100
West Sixth Street, Suite 300


                                Media,
PA 19063


                                Facsimile:


 


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