**Exhibit 10.3**

 

**GUARANTY**

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

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

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

WHEREAS, it is acondition precedent to the Lenders’ making any loans****or otherwiseextending credit to the Borrower under the Credit Agreement that eachGuarantor executes and delivers to the Administrative Agent, for the benefit ofthe Lenders and the Administrative Agent, a guaranty substantially in the formhereof; and

WHEREAS, each Guarantorwishes to guaranty the Borrower’s obligations to the Lenders and theAdministrative Agent under or in respect of the Credit Agreement as providedherein;

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

**1.****                                     ****Definitions** The term “Obligations” and all other capitalized terms used hereinwithout definition shall have the respective meanings provided therefor in theCredit Agreement.

**2.****                                     ****Guaranty of Payment andPerformance**.  Each Guarantor hereby jointly and severallyunconditionally guarantees to the Lenders and the Administrative Agent the fulland punctual payment when due (whether at stated maturity, by requiredpre-payment, by acceleration or otherwise), as well as the performance, of allof the Obligations, including all such which would become due but for theoperation of the automatic stay pursuant to §362(a) of the Bankruptcy Code ofthe United States and the operation of §§502(b) and 506(b) of the BankruptcyCode of the United States.  This Guarantyis an absolute, unconditional and continuing guaranty of the full and punctualpayment and performance of all of the Obligations and not of theircollectibility only and is in no way conditioned upon any requirement that theAdministrative Agent or any Lender first attempt to collect any of the Obligationsfrom the 

 

 

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Borrower or resort to any collateral security or othermeans of obtaining payment.  Should theBorrower default in the payment or performance of any of the Obligations, theobligations of the Guarantors hereunder with respect to such Obligations indefault shall, upon demand by the Administrative Agent, become immediately dueand payable to the Administrative Agent, for the benefit of the Lenders and theAdministrative Agent, without demand or notice of any nature, all of which are expresslywaived by each Guarantor.  Payments byeach Guarantor hereunder may be required by the Administrative Agent on anynumber of occasions.  All payments by anyGuarantor hereunder shall be made to the Administrative Agent, in the mannerand at the place of payment specified therefor in the Credit Agreement, for theaccount of the Lenders and the Administrative Agent.

Notwithstanding anyprovision to the contrary contained herein or in any other of the LoanDocuments or Swap Contracts, the obligations of each Guarantor under thisGuaranty and the other Loan Documents shall be limited to an aggregate amountequal to the largest amount that would not render such obligations subject toavoidance under the Debtor Relief Laws or any comparable provisions of anyapplicable state law.

**3.****                                     ****Guarantors’ Agreement toPay Enforcement Costs, etc**.  EachGuarantor further jointly and severally agrees, as the principal obligor andnot as a guarantor only, to pay to the Administrative Agent, on demand, allcosts and expenses (including court costs and reasonable legal expenses)incurred or expended by the Administrative Agent or any Lender in connectionwith the Obligations, this Guaranty and the enforcement thereof, together withinterest on amounts recoverable under this Section 3 from the time when suchamounts become due until payment, whether before or after judgment, at the rateof interest for overdue principal set forth in the Credit Agreement, providedthat if such interest exceeds the maximum amount permitted to be paid underapplicable law, then such interest shall be reduced to such maximum permittedamount.

**4.****                                     ****Waivers by Guarantors;Lenders’ Freedom to Act**.  EachGuarantor agrees that the Obligations will be paid and performed strictly inaccordance with their respective terms, regardless of any law, regulation ororder now or hereafter in effect in any jurisdiction affecting any of suchterms 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 othernotices of any kind, all defenses which may be available by virtue of anyvaluation, 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 otherentity or other person primarily or secondarily liable with respect to any ofthe Obligations, and all suretyship defenses generally.  Without limiting the generality of the foregoing,each Guarantor agrees to the provisions of any instrument evidencing, securingor otherwise executed in connection with any Obligation and agrees that theobligations of each Guarantor hereunder shall not be released or discharged, inwhole or in part, by (i) the failure of the Administrative Agent or any Lender to assert any claim or demandor to enforce any right or remedy against the Borrower or any other entity orother person primarily or secondarily liable with respect to any of theObligations; (ii) any extensions, compromise, refinancing, consolidation orrenewals of any Obligation; (iii) any change in the time, place or manner ofpayment 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 orprovisions of the Credit Agreement,the Notes, the other Loan Documents****or anyother agreement evidencing, securing or otherwise executed in connection withany of the Obligations, (iv) the addition, substitution or release of anyentity or other person primarily or secondarily liable for any Obligation; (v)the adequacy of any rights which the Administrative Agent or any Lender mayhave against any collateral security or other means of obtaining repayment ofany of the Obligations; (vi) the impairment of any collateral securing any ofthe Obligations, including without limitation the failure to perfect orpreserve any rights which the Administrative Agent or any Lender might have insuch collateral security or the substitution, exchange, surrender, release,loss or destruction of any such collateral security; or (vii) any other act oromission which might in any manner or to any extent vary the risk of any Guarantoror otherwise operate as a release or discharge of any Guarantor, all of whichmay be done without notice to the Guarantors. To the fullest extent permitted by law, each Guarantor hereby expresslywaives any and all rights or defenses arising by reason of (A) any “one action”or “anti-deficiency” law which would otherwise prevent the Administrative Agentor 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’scommencement or completion of any foreclosure action, whether judicially, byexercise of power of sale or otherwise, or (B) any other law which in any otherway would otherwise require any election of remedies by the AdministrativeAgent or any Lender.

**5.****                                     ****Unenforceability ofObligations Against Borrower**.  If for anyreason the Borrower has no legalexistence 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’sinsolvency, bankruptcy or reorganization or by other operation of law or forany other reason, this Guaranty shall nevertheless be binding on each Guarantorto the same extent as if such Guarantor at all times had been the principalobligor on all such Obligations, subject to any limitations set forthherein.  In the event that accelerationof the time for payment of any of the Obligations is stayed upon theinsolvency, bankruptcy or reorganization of the Borrower, or for any otherreason, all such amounts otherwise subject to acceleration under the terms ofthe Credit Agreement, the Notes, theother Loan Documents or any other agreement evidencing, securing orotherwise executed in connection with any Obligation shall be immediately dueand payable by the Guarantors.

**6.****                                     ****Subrogation; Subordination**.

**6.1.****                           ****Waiver of Rights AgainstBorrower**.  Until the final payment and performance infull of all of the Obligations, (A) no Guarantor shall exercise any rightsagainst the Borrower arising asa result of payment by such Guarantor hereunder, by way of subrogation,reimbursement, restitution, contribution or otherwise, and will not prove anyclaim in competition with the Administrative Agent or any Lender in respect ofany payment hereunder in any bankruptcy, insolvency or reorganization case orproceedings of any nature; (B) no Guarantor will claim any setoff, recoupmentor counterclaim against the Borrower in respect of any liability of suchGuarantor to the Borrower; and (C) each Guarantor postpones and subordinatesany benefit of and any right to participate in any collateral security whichmay be held by the Administrative Agent or any Lender.

 

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**6.2.****                           ****Subordination****.**  The payment ofany amounts due with respect to any indebtedness of the Borrower for moneyborrowed or credit received now or hereafter owed to any Guarantor is herebysubordinated to the prior payment in full of all of the Obligations.  Each Guarantor agrees that, after theoccurrence of any Default in the payment or performance of any of theObligations, such Guarantor will not demand, sue for or otherwise attempt tocollect any such indebtedness of the Borrower to such Guarantor until all ofthe Obligations shall have been paid in full in cash or until such Default iscured or waived in accordance with the terms and conditions of the LoanDocuments.  If, notwithstanding theforegoing sentence, any Guarantor shall collect, enforce or receive any amountsin respect of such indebtedness while any Obligations are still outstanding,such amounts shall be collected, enforced and received by such Guarantor astrustee for the Lenders and the Administrative Agent and be paid over to theAdministrative Agent, for the benefit of the Lenders and the AdministrativeAgent, on account of the Obligations without affecting in any manner theliability of any Guarantor under the other provisions of this Guaranty.

**6.3.****                           ****Provisions Supplemental****.**  The provisionsof this Section 6 shall be supplemental to and not in derogation of any rightsand remedies of the Lenders and the Administrative Agent under any separatesubordination agreement which the Administrative Agent may at any time and fromtime to time enter into with any Guarantor for the benefit of the Lenders andthe Administrative Agent.

**7.****                                     ****Security; Setoff****.**  Each Guarantorgrants to each of the Administrative Agent and the Lenders, as security for thefull and punctual payment and performance of all of such Guarantor’sobligations hereunder, a continuing lien on and security interest in allsecurities or other property belonging to such Guarantor now or hereafter heldby the Administrative Agent or such Lender and in all deposits (general orspecial, time or demand, provisional or final) and other sums credited by ordue from the Administrative Agent or such Lender to such Guarantor or subjectto withdrawal by such Guarantor.  Regardlessof the adequacy of any collateral security or other means of obtaining paymentof any of the Obligations, each of the Administrative Agent and the Lenders ishereby authorized at any time and from time to time, without notice to anyGuarantor (any such notice being expressly waived by each Guarantor) and to thefullest extent permitted by law, to set off and apply such deposits and othersums against the obligations of such Guarantor under this Guaranty, whether ornot the Administrative Agent or such Lender shall have made any demand underthis Guaranty****and although such obligations may becontingent or unmatured.

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

 

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

**9.****                                     ****Covenants under CreditAgreement**.  Each Guarantor acknowledges that aResponsible Officer of such Guarantor has read a copy of each of the LoanDocuments 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 Guarantyshall remain in full force and effect until the Obligations have been paid andperformed in full in cash and all credit commitments of the AdministrativeAgent and the Lenders in respect thereof (including all outstanding Letters ofCredit) have terminated.  This Guarantyshall continue to be effective or be reinstated, notwithstanding anytermination, if at any time any payment made or value received with respect toany Obligation is rescinded or must otherwise be returned by the AdministrativeAgent or any Lender upon the insolvency, bankruptcy or reorganization of theBorrower, or otherwise, all as though such payment had not been made or valuereceived.

**11.****                              ****Successors and Assigns****.**  This Guarantyshall be binding upon each Guarantor, its respective successors and assigns,and shall inure to the benefit of the Administrative Agent and the Lenders andtheir respective successors, transferees and assigns.  Without limiting the generality of theforegoing sentence, each Lender may assign or otherwise transfer the CreditAgreement, the Notes, the other LoanDocuments or any other agreement or note held by it evidencing, securingor otherwise executed in connection with the Obligations, or sellparticipations in any interest therein, to any other entity or other person,and such other entity or other person shall thereupon become vested, to theextent set forth in the agreement evidencing such assignment, transfer orparticipation, with all the rights in respect thereof granted to such Lenderherein, all in accordance with Section 11.06 of the Credit Agreement.  No Guarantor may assign any of itsobligations hereunder.

**12.****                              ****Amendments and Waivers****.**  No amendmentor waiver of any provision of this Guaranty nor consent to any departure by theGuarantor therefrom shall be effective unless the same shall be in writing andsigned by the Administrative Agent in accordance with Section 11.01 of theCredit Agreement.  No failure on the partof the Administrative Agent or any Lender to exercise, and no delay inexercising, any right hereunder shall operate as a waiver thereof; nor shallany single or partial exercise of any right hereunder preclude any other orfurther exercise thereof or the exercise of any other right.

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

 

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**14.****                              ****Governing Law; Consent toJurisdiction****.**  **THISGUARANTY IS INTENDED TO TAKE EFFECT AND SHALL BE GOVERNED BY, AND CONSTRUED INACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA**.  Each Guarantor agrees that any suit for theenforcement of this Guaranty may be brought in the courts of the Commonwealthof Pennsylvania sitting in Philadelphia County and of the United StatesDistrict Court of the Eastern District of Pennsylvania and consents to thenonexclusive jurisdiction of such court and to service of process in any suchsuit being made upon the Guarantor by mail at the address specified byreference in Section 13.  Each Guarantorhereby waives any objection that it may now or hereafter have to the venue ofany such suit or any such court or that such suit was brought in an inconvenientcourt.

**15.****                              ****Waiver of Jury Trial****.**  **EACH GUARANTOR AND THE ADMINISTRATIVE AGENT FOR ITSELFAND THE LENDERS HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANYACTION 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 OROBLIGATIONS**.  Except asprohibited by law, each Guarantor and the Administrative Agent for itself andthe Lenders hereby waives any right which it may have to claim or recover inany 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 LoanDocuments to which the Administrative Agent or any Lender is a party, theAdministrative Agent and the Lenders are relying upon, among other things, thewaivers and certifications contained in this Section 15.

**16.****                              ****Miscellaneous****.**  This Guarantyconstitutes the entire agreement of each Guarantor with respect to the mattersset forth herein.  The rights andremedies herein provided are cumulative and not exclusive of any remediesprovided by law or any other agreement, and this Guaranty shall be in additionto any other guaranty of or collateral security for any of theObligations.  The invalidity orunenforceability of any one or more sections of this Guaranty shall not affectthe validity or enforceability of its remaining provisions.  Captions are for the ease of reference onlyand shall not affect the meaning of the relevant provisions.  The meanings of all defined terms used inthis Guaranty shall be equally applicable to the singular and plural forms ofthe terms defined.

**17.****                              ****Contribution****.** To the extent any Guarantor makes a payment hereunder in excess of theaggregate amount of the benefit received by such Guarantor in respect of theextensions of credit under the Credit Agreement (the “Benefit Amount”), then such Guarantor, after the final andundefeasible payment in full, in cash, of all of the Obligations, shall beentitled to recover from each other guarantor of the Obligations such excesspayment, pro rata, in accordance with theratio of the Benefit Amount received by each such other guarantor to the totalBenefit Amount received by all guarantors of the Obligations, and the right tosuch recovery shall be deemed to be an asset and property of such Guarantor sofunding.

 

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**IN WITNESSWHEREOF,** eachGuarantor has caused this Guaranty to be executed and delivered as of the datefirst 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, itsgeneral 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, itsgeneral 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, itsgeneral 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:                100West Sixth Street, Suite 300

                                Media,PA 19063

                                Facsimile:

 

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