Exhibit 10.3 ———— GUARANTY DATED AUGUST 12, 2003 BETWEEN FIRST ENERGY CORP. AND ATLAS RESOURCES, INC. TO GAS PURCHASE AGREEMENT DATED MARCH 31, 1999 BETWEEN NORTHEAST OHIO GAS MARKETING, INC., AND ATLAS ENERGY GROUP, INC., ATLAS RESOURCES, INC., AND RESOURCE ENERGY, INC.FirstEnergy(R) 76 South Main St. Akron, Ohio 44308- ——————————————————————————– 1-800-633-4766 Guaranty dated as of August 12, 2003 by and between FirstEnergy Corp., anOhio corporation, with its principal place of business at 76 South Main Street,Akron, OH 44308 (“Guarantor”) and Atlas Resources Inc., a Pennsylvaniacorporation, with its principal place of business at 311 Rouser Rd., Coraopolis,PA 15108 (“Seller”). Seller, together with its affiliates Atlas Energy Group,Inc., an Ohio Corporation, Resource Energy, Inc., a Delaware corporation, andViking Resources Corporation, an Ohio Corporation, entered into a Gas PurchaseAgreement for the purchase and sale of natural gas (“Sales Agreement”) toFirstEnergy Solutions Corp.,(“Customer”), a subsidiary of the Guarantor. In consideration thereof, and as an inducement for the extension of creditby the Seller to the Customer, the Guarantor hereby absolutely andunconditionally guarantees to the Seller, its permitted successors and assignspursuant to this letter (this “Guaranty”), the prompt payment (within three (3)business days of demand by the Seller) of any and all amounts that are or mayhereafter become due and payable (taking into account all applicable graceperiods) from the Customer to the Seller by reason of the Sales Agreement (the”Obligations”), to fully perform the Sales Agreement, as well as anyindebtedness under the Sales Agreement (regardless of whether such indebtednessbe in the form of book accounts, promissory notes, trade acceptances, checks,drafts, or other evidence of indebtedness, together with late fees, servicecharges or liquidated damages (but only if, and to the extent, provided for inthe Sales Agreement) and interest at the rate specified therein) This Guarantyshall be a guaranty of payment, and not of collection, and the Seller shall notbe required to take any proceedings or exhaust its remedies against the Customerprior to the exercise of its rights and remedies against the Guarantor, asguarantor. The Guarantor hereby agrees to reimburse the Seller for all sums paid to itby the Customer under the Sales Agreement, which must subsequently be returnedby the Seller to the Customer as a preference or fraudulent transfer under theFederal Bankruptcy Code, any applicable state law and for any other reason. Notwithstanding anything else in this Guaranty to the contrary, theobligation and liability of Guarantor hereunder shall not (i) be effective orenforceable with respect to any Obligation, liability or claim relating in anyway to consequential, indirect, punitive or exemplary damages of any kindwhatsoever, whether owing by Company or otherwise, and (ii) exceed FifteenMillion Dollars ($15,000,000) in the aggregate. This Guaranty is a continuingguaranty and shall remain in full force and effect from August 12, 2002 until atleast March 31, 2005, and shall continue on a monthly basis thereafter, unlessterminated by either party with thirty (30) days written notice to the otherparty. If the Guarantor shall be adjudicated bankrupt under the Federal BankruptcyLaws, or if any petition for any relief under any of such laws shall be filed byor against the Guarantor, or if the Guarantor shall make an assignment for thebenefit of creditors or shall apply for a receiver for all or any part of itsproperty, or if the Guarantor shall become insolvent or unable to pay its debtsas they mature, then and in any such event all of the Obligations shallforthwith become and be immediately due and payable by the Guarantor. Notice of demand by the Seller shall be sent by either certified mail,return receipt requested, or hand delivery, to the respective addressesspecified above, with notices to the Guarantor sent to the attention of theCredit Manager and notices to the Seller sent to the attention of both JohnRanieri and Nancy McGurk, and shall be deemed to be received on the day thatsuch writing is delivered to the intended recipient thereof. 1 The Guarantor hereby acknowledges that any modification of the SalesAgreement shall not affect the liability of the Guarantor with respect hereto.Except as provided above with respect to the requirement of notice from theSeller to the Guarantor of a payment demand, the Guarantor hereby waives, to theextent permitted by law, the requirements of the giving of any notice,including, but not limited to, (a) notice of the acceptance of this Guaranty bythe Seller; (b) notice of the entry into the Sales Agreements between theCustomer and the Seller and of any modifications thereto; (c) notice of anyextension of time for the payment of any sums due and payable to the Sellerunder the Sales Agreement; (d) with respect to any notes or evidence ofindebtedness received by the Seller from the Customer, notice of presentment,notice of adverse facts, protest or notice of protest; and (e) notice of anydefaults by or disputes with the Customer. This Guaranty shall not be affected by the taking of any checks, notes orother obligations, secured or unsecured, in any amount, purportedly in paymentof the whole or any part of any Obligations or by reason of any extension oftime given to, or any indulgences shown to, the Customer by the Seller, or bythe making, execution and delivery of any oral or written agreement oragreements affecting said Obligations. The Guarantor’s liability hereunder shallnot be impaired or discharged by reason of any reorganization, insolvency,bankruptcy or similar proceeding (whether voluntary or involuntary) modifyingthe Seller’s rights and remedies against the Customer with regard to anyObligation or liability of the Customer to the Seller under the Sales Agreement. The Guarantor also waives diligence, presentment, protest to or uponCustomer with respect to the Obligations. This Guaranty shall be construed as acontinuing, absolute and unconditional guarantee of payment without regard to(a) the validity, regularity or enforceability of the Sales Agreement, any ofthe Obligations or any other collateral security therefor or guarantee a rightof offset with respect thereto at any time or from time to time by Seller, (b)until Seller shall have been paid in full, any right by Guarantor to subrogationof indemnification, or (c) any other circumstance whatsoever (with or withoutnotice to or knowledge of the Seller or Guarantor) which constitutes, or mightbe construed to constitute, an equitable or legal discharge of the Customer forthe Obligations, or of Guarantor under this Guaranty, in bankruptcy or in anyother instance. When pursuing its rights and remedies hereunder againstGuarantor, the Seller may, but shall be under no obligation to, pursue suchrights and remedies as it may have against Customer or any other party oragainst any collateral security or guarantee for the Obligations or any right tooffset with respect thereto, and any failure by Seller to pursue such otherrights or remedies or to collect any payments from the Customer or any suchother party or to realize upon any such collateral security or guarantee or toexercise any such right of offset, or any release of Customer or any such otherparty or of any such collateral security, guarantee or right of offset, shallnot relieve Guarantor of any liability hereunder, and shall not impair or affectthe rights and remedies, whether express, implied or available as a matter oflaw, of Seller against Guarantor. Notwithstanding anything else in this Guaranty to the contrary, Guarantorshall be permitted and entitled to raise all defenses to payment hereunder thatare available to Company, other than those defenses available to the Companysolely as a result of bankruptcy, insolvency, reorganization and other similarproceedings. This Guaranty shall bind the Guarantor for any and all of the Customer’spurchases of natural gas from the Seller, or the Seller’s production affiliates,Resource Energy, Inc., Viking Resources Corporation, and Atlas Energy Group,Inc. This Guaranty shall remain in full force and effect and be binding inaccordance with and to the extent of its terms upon Guarantor and its successorsand assigns thereof, and shall inure to the benefits of the Seller, and itsrespective successors, transferees, affiliates and assigns, until allObligations and the obligations of Guarantor under this Guaranty shall beensatisfied by payment in full. The Guarantor represents and warrants, as the date hereof, that thisGuaranty has been duly authorized, executed and delivered by the Guarantor. 2 This Guaranty shall not be assigned or modified without the written consentof each of the Guarantor and the Seller and shall not be affected by any changein the relationship between Guarantor and the Customer. This Guaranty shall notbe relied upon, or enforced, by any person other than the Guarantor, theCustomer, and the Seller. This Guaranty shall be governed by and construed in accordance with thelaws of the State of Ohio, without regard to the conflict of law rules thereof.The Guarantor and the Seller, by accepting this Guaranty, submit to thenon-exclusive jurisdiction of the Courts of the State of Ohio and the UnitedStates District Court of Northern District of Ohio. This Guaranty revokes any prior guaranty issued by the Guarantor to theSeller for the obligations of the Customer. IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executedby its duly authorized officer as of the date first above written. FIRSTENERGY CORP. /s/ Randy Scilla ———————– Randy Scilla Assistant Treasurer 3