CERTIFICATE OF DESIGNATION, RIGHTS, & LIMITATIONS

EXHIBIT 3.16

CERTIFICATE OF DESIGNATION, RIGHTS, AND LIMITATIONS
OF THE SERIES E CONVERTIBLE PREFERRED STOCK
OF QUANTA SERVICES, INC.

Quanta Services, Inc., a Delaware corporation (the
"Corporation"), certifies that pursuant to the authority conferred upon the
Board of Directors of the Corporation (the "Board of Directors") by the Amended
and Restated Certificate of Incorporation of the Corporation (the "Certificate
of Incorporation"), and in accordance with the provisions of Section 151 of the
General Corporation Law of the State of Delaware, as amended (the "DGCL"), the
Board of Directors, on October 15, 2002, adopted the following resolution
creating and issuing a series of its Preferred Stock, par value $0.00001 per
share:

RESOLVED, that (1) pursuant to the authority conferred upon
the Board of Directors of the Corporation by the Certificate of Incorporation of
the Corporation, the Board of Directors hereby designates 3,918,209 shares of
the preferred stock par value $0.00001 per share, of the Corporation as "Series
E Convertible Preferred Stock" (the "Series E Preferred Stock"), and the powers,
designations, preferences and relative, participating, optional and other rights
of the Series E Preferred Stock and the qualifications, limitations and
restrictions thereof, be, and the hereby are, as set forth below (the
"Certificate of Designation") and (2) in connection therewith, the officers of
the Corporation be, and each of them hereby is, authorized, empowered and
directed on behalf of the Corporation and in its name to execute and file the
Certificate of Designation with the Delaware Secretary of State:

1. Designation. Three Million, Nine Hundred Eighteen Thousand,
Two Hundred Nine (3,918,209) shares of the authorized and unissued preferred
stock of the Corporation, $0.00001 par value per share, are hereby designated
"Series E Convertible Preferred Stock".

2. Dividends.

(a) Preferred Dividend. Subject to the immediately
following sentence and Section 2(b), no dividends shall be payable on the Series
E Preferred Stock. Notwithstanding the first sentence of this Section 2(a), if
after the fourth (4th) anniversary of the Original Issue Date (as defined
below), the Series E Preferred Stock shall not have been converted into Common
Stock pursuant to Section 6 hereof, then the Series E Preferred Stock shall
accrue dividends at a rate of 8.0% per annum, when and as declared by the Board
of Directors, payable in shares of Series E Preferred Stock legally available
for that purpose (the "Preferred Dividend"), retroactive to the Original Issue
Date; provided, that the accrual of Preferred Dividends may not cause First
Reserve's (as defined below) Voting Percentage to exceed the Standstill Amount
(as defined in the Securities Purchase Agreement, dated as of October 15, 2002,
between the Corporation and First Reserve (the "Purchase Agreement")). In the
event that the payment of Preferred Dividends to First Reserve causes First
Reserve's Voting Percentage to exceed the Standstill Amount, the Preferred
Dividends shall cease accruing for so long as First Reserve's Voting Percentage
exceeds the Standstill Amount, and the Series E Preferred Stock shall accrue
dividends in cash at a rate of 8.0% per annum (the "Cash Dividend"). In such
event, and if in such event the Cash Dividends may not be payable under the
terms of the Corporation's outstanding debt instruments,


the Corporation shall make reasonable best efforts to obtain all required
approvals necessary to permit the payment of the Cash Dividend. If First
Reserve's Voting Percentage ceases to exceed the Standstill Amount, the Cash
Dividend shall cease, and the Series E Preferred Stock shall again begin to
accrue the Preferred Dividend. Upon the effectiveness of the Preferred Dividend,
the Preferred Dividend on each share of Series E Preferred Stock shall be
cumulative from the date of issuance of such share, whether or not earned,
whether or not shares of the Corporation are legally available for therefor and
whether or not declared by the Board of Directors, but such dividend shall be
payable only when, as, and if declared by the Board of Directors. Subject to the
rights of the holders of the Corporation's outstanding Series A Convertible
Preferred Stock, par value $0.00001 per share (the "Series A Preferred Stock"),
so long as any shares of Series E Preferred Stock shall be outstanding, (i) no
dividend, whether in cash, stock or property, shall be paid or declared, nor
shall any other distribution be made, on any shares of the common stock of the
Corporation, par value $0.00001 per share (the "Common Stock"), or any other
class or series of capital stock of the Corporation, (ii) nor shall any class or
series of capital stock of the Corporation be redeemed, purchased or otherwise
acquired for value by the Corporation (except for acquisitions of Common Stock
by the Corporation pursuant to (A) agreements which permit the Corporation to
repurchase such shares upon termination of services to the Corporation entered
into on or before the date on which the shares of Series E Preferred Stock were
first issued (the "Original Issue Date") or (B) in satisfaction of an
indemnification obligation to the Corporation upon a breach by the holder of
Common Stock of a representation, warranty or covenant in any agreement for the
acquisition by the Corporation of a business (as defined in Rule 11-01(d) of
Regulation S-X adopted by the Securities and Exchange Commission) pursuant to
the Corporation's acquisition program (an "Acquisition"), in each case, until
all dividends set forth in this Section 2(a) on the Series E Preferred Stock
shall have been paid or declared and set apart. "Voting Percentage" has the
definition set forth in the Securities Purchase Agreement. "First Reserve" means
First Reserve Fund IX, L.P., a Delaware limited partnership, or a permitted
transferee that is an Affiliate (as defined in the Purchase Agreement) of First
Reserve under the provisions of the Investor's Rights Agreement, dated as of
October 15, 2002, between First Reserve and the Corporation.

(b) Participating Dividend. The shares of Series E
Preferred Stock shall be entitled to receive, out of any funds legally available
therefor, the amount of any cash or non-cash dividends or distributions declared
and paid on the shares of Common Stock, as if the shares of Series E Preferred
Stock had been converted immediately prior to the record date for payment of
such dividends or distributions (the "Participating Dividend"); provided,
however, the shares of Series E Preferred Stock shall not be entitled to receive
any non-cash dividend or distribution if the number or kind of securities
issuable upon conversion of the Series E Preferred Stock is adjusted under
Section 7 hereof in connection therewith. The Participating Dividend on each
share of Series E Preferred Stock shall be cumulative from the date of issuance
of such share, whether or not earned, whether or not the Corporation has funds
legally available for therefor and whether or not declared by the Board of
Directors, but such dividend shall be payable only when, as, and if declared by
the Board of Directors.

(c) Termination of Preferred and Participating Dividends.
The Preferred Dividends and Participating Dividends, except accrued and unpaid
Preferred Dividends and

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Participating Dividends, will terminate on the date that the Series E Preferred
Stock is converted into shares of the Corporation's Common Stock.

3. Voting Rights.

(a) General. Except as set forth in Section 3(b) hereof,
the Series E Preferred Stock shall have no voting rights.

(b) Veto Rights. So long as the outstanding shares of
Series E Preferred Stock represent 10% or more of the Voting Securities, the
approval by the vote or written consent of the holders of at least two-thirds of
the then outstanding shares of Series E Preferred Stock, voting together as a
single class, shall be necessary before the Corporation may:

(i) Authorize, issue or enter into any agreement
providing for the issuance (contingent or otherwise) of (A) any
authorized but unissued shares of Series E Preferred Stock or any other
class or series of capital stock senior to or on par with the Series E
Preferred Stock as to dividend rights or (B) any notes or debt
securities containing equity features, including, without limitation,
any notes or debt securities convertible into or exchangeable for
equity securities, having dividend rights on par with or senior to the
Series E Preferred Stock;

(ii) Redeem or purchase or otherwise acquire any
of its capital stock, now or hereafter issued, of any class, except for
(A) any repurchase of shares of capital stock pursuant to any employee
benefit plan adopted by the Corporation and (B) any acquisition of
shares of capital stock by the Corporation pursuant to agreements which
permit the Corporation to repurchase such shares (1) upon termination
of services to the Corporation entered into on or before the Original
Issue Date or (2) in satisfaction of an indemnification obligation to
the Corporation upon a breach by the holder of Common Stock of a
representation, warranty or covenant in any agreement for an
Acquisition;

(iii) Enter into a transaction or series of
transactions resulting in the sale, lease, transfer or other
disposition of all or substantially all of the assets of the
Corporation in which the holders of the Series E Preferred Stock would
receive less than the Common Stock for each share of Series E Preferred
Stock held by them;

(iv) Liquidate, dissolve or wind up the
Corporation in any form of transaction; or

(v) Amend the Corporation's Certificate of
Incorporation or Bylaws or the organizational documents of a subsidiary
of the Corporation (whether by merger, consolidation or otherwise
(including the filing of, or amending, a certificate of designation)),
in each case as amended, or file with any governmental authority any
resolution of the Board of Directors containing in each case any
provisions that would adversely affect or otherwise impair the voting
powers, preferences or other special rights or privileges,
qualifications, limitations or restrictions of the Series E Preferred
Stock (including, without limitation, an amendment or resolution to
increase the number of directors of the Corporation to a number greater
than 12).

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4. Liquidation, Dissolution or Winding Up; Redemption.

(a) Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, voluntary or
otherwise, no distribution shall be made to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series E Preferred Stock unless, prior thereto, the holders
of shares of Series E Preferred Stock shall have received an amount per share
(the "Series E Liquidation Preference") equal to the greater of (i) the initial
purchase price of the Series E Preferred Stock plus any accrued Preferred
Dividends that would have accrued pursuant to Section 2(a) hereof had such
provision applied, and (ii) the amount payable if such Series E Preferred Stock
had been converted into Common Stock immediately prior to any such liquidation,
dissolution or winding up. In the event, however, that there are not sufficient
assets available to permit payment in full of the Series E Liquidation
Preference and the liquidation preferences of all other classes and series of
stock of the Corporation, if any, that rank on a parity with the Series E
Preferred Stock in respect thereof, then the assets available for such
distribution shall be distributed ratably to the holders of the Series E
Preferred Stock and the holders of such parity shares in proportion to their
respective liquidation preferences. Neither the merger or consolidation of the
Corporation into or with another corporation or other entity nor the merger or
consolidation of any other corporation or other entity into or with the
Corporation shall be deemed to be a liquidation, dissolution or winding up of
the Corporation for purposes of this Section 4.

(b) Redemption.

(i) So long as any shares of Series E Preferred
Stock are outstanding, the occurrence of (A) an Approved Sale, (B) the
fifth (5th) anniversary of the Original Issue Date or (C) an
underwritten public offering lead managed by a nationally recognized
investment bank pursuant to a registration statement declared effective
under the Securities Act of 1933, as amended, covering the offering and
sale of Voting Securities in which net proceeds received by the
Corporation in such public offering, after all costs and expenses,
including without limitation, underwriting discounts and commissions,
equals or exceeds $215,000,000, and in which the price per share to the
public is at least $4.40 (a "Qualified Financing"), shall be a
redemption event ("Redemption Event"). Upon the approval by vote or
written consent of the holders of at least a majority of the then
outstanding shares of Series E Preferred Stock, an Approved Sale or
Qualified Financing shall not be deemed to be a Redemption Event within
the meaning of this Section 4(b). Upon the occurrence of a Redemption
Event, if the Corporation or the holder(s) of a majority of the
outstanding Series E Preferred Stock give written notice to the other
(in accordance with Section 4(b)(ii) below) that such party intends to
request redemption, the shares of Series E Preferred Stock shall be
redeemed by the Corporation, and the holder of each share of Series E
Preferred Stock shall be entitled to receive the Series E Redemption
Amount (as defined below). The term "Approved Sale" shall mean (i) any
sale, transfer, issuance or redemption or series of sales, transfers,
issuances or redemptions (or any combination thereof) of shares of the
Corporation's capital stock by the holders thereof or the Corporation,
or any merger, consolidation, reclassification or other transaction,
which results in any person or entity

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or group of affiliated persons or entities (other than the owners of
the Corporation's capital stock (on a fully diluted basis) immediately
prior to any such transaction or series of transactions) beneficially
owning, directly or indirectly more than 50% of, respectively, the then
outstanding equity securities, or the combined voting power of the then
outstanding capital stock entitled to vote generally in the election of
the Board of Directors, or (ii) a sale or other transfer of all or
substantially all of the assets of the Corporation and its Subsidiaries
on a consolidated basis in any transaction or series of related
transactions (other than sales in the ordinary course of business) as
the case may be, which is approved by a majority of the directors of
the Corporation not designated by the holder(s) of the Series E
Preferred Stock. The term "Subsidiary" shall mean any person or entity
of which securities or other ownership interests representing more than
50% of the ordinary voting power or equity interests of such person or
entity are at the time owned or controlled, directly or indirectly, by
the Corporation.

(ii) If a Qualified Financing or Approved Sale is
intended to occur, the Corporation will notify each holder of Series E
Preferred Stock in writing of such pending event no less than 10 days
prior to the consummation thereof. Such notice will describe the
material terms and conditions of such event (including, but not limited
to, the amount and nature of the total consideration to be paid in
connection therewith). The holder(s) of the Series E Preferred Stock
shall be entitled to receive an amount per share (the "Series E
Redemption Amount") equal to the higher of (i) the Original Issue Price
(calculated assuming the accrual of dividends from the Original Issue
Date), or (ii) an amount equal to the product of the then-current
market price of a share of Common Stock (on any national securities
exchange on which the Common Stock is then listed, or if the Common
Stock is not then so listed, as determined in the good faith judgment
of the Corporation's board of directors) multiplied by the number of
shares of Common Stock that would have been received by the holder(s)
of the Series E Preferred Stock upon conversion of the Series E
Preferred Stock into Common Stock, taking into account all accrued
Preferred Dividends. The "Original Issue Price" of the Series E
Preferred Stock shall equal the purchase price originally paid with
respect to each share plus accrued and unpaid dividends (as adjusted
for any stock dividends, combinations, splits and the like with respect
to such shares). The right of redemption set forth in this Section 4(b)
shall terminate upon the conversion of the Series E Preferred Stock
into Common Stock. The right of the holder(s) of the Series E Preferred
Stock to receive the Redemption Amount shall be explicitly subordinate
to the Corporation's obligations pursuant to the terms of any
indebtedness, whether secured or unsecured.

5. Ranking. The Series E Preferred Stock shall rank equally with
the Series A Preferred Stock as to the distributions of assets upon liquidation,
dissolution or winding up and shall rank senior to the Common Stock on such
matter.

6. Conversion. The Corporation and holders of the Series E
Preferred Stock shall have, and be subject to, the conversion rights as follows
(the "Conversion Rights"):

(a) Right to Convert. Subject to and in compliance with
the provisions of this Section 6, any shares of Series E Preferred Stock may, at
the option of the holder or the Corporation, be converted at any time following
the Convertibility Date (as defined below) into

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fully paid and nonassessable shares of Common Stock; provided, that if the
Corporation enters into a definitive agreement with respect to a Change of
Control (as defined below) transaction within 60 days following the date of
issuance of the Series E Preferred Stock, then the Series E Preferred Stock
shall not be deemed to be convertible (or to have been converted) into Common
Stock for purposes of the per share Common Stock consideration payable in
connection with such Change of Control transaction; provided, further, that in
the event of a Change of Control transaction within the period as specified in
the proviso immediately prior to this proviso, the holder of the Series E
Preferred stock shall be entitled upon consummation of such transaction to a
cash payment equal to the Original Issue Price (calculated assuming the accrual
of dividends from the Original Issue Date). The number of shares of Common Stock
to which a holder of Series E Preferred Stock shall be entitled upon conversion
by the holder shall be the product obtained by multiplying the Series E
Preferred Stock Rate then in effect (determined as provided in Section
6(b)(iii)) times the number of shares of Series E Preferred Stock being
converted by such holder. Any conversion of Series E Preferred Stock pursuant to
this Section 6 shall, in the case of a conversion requested by a holder of
Series E Preferred Stock, be for all, and not less than all, of the shares of
Series E Preferred Stock held by such holder and, in the case of a conversion
requested by the Corporation, be for all, and not less than all, of the
outstanding Series E Preferred Stock.

(b) Certain Definitions and Determinations. As used in
Section 6, the following terms shall have the following meanings:

(i) "Change of Control" shall be deemed to have
occurred if (i) any Person acquires, directly or indirectly, the
beneficial ownership of any voting security of the Corporation and
immediately after such acquisition such person is, directly or
indirectly, the beneficial owner of voting securities representing 50%
or more of the total voting power of all the then outstanding voting
securities of the Corporation entitled to vote generally in the
election of directors; or (ii) individuals who on the initial issuance
of the Series E Preferred Stock constitute the Corporation's Board of
directors, or their successors approved in accordance with the terms
below, cease for any reason to constitute at least a majority thereof,
unless the election or nomination for the election by the Corporation's
stockholders of each new director was approved by vote of at least
2/3rds of the directors then still in office who were directors on the
initial issuance of the Series E Preferred Stock or their successors
approved in accordance with the terms hereof.

(ii) "Closing Price" means on any particular date
(A) the last sale price per share of the Common Stock on such date on
the principal stock exchange on which the Common Stock has been listed
or, if there is no such price on such date, then the last sale price on
such exchange on the date nearest preceding such date, (B) if the
Common Stock is not listed on any stock exchange, the final bid price
for a share of Common Stock in the over-the-counter market, as reported
by the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") at the close of business on such date, or the last
sales price if such price is reported and final bid prices are not
available, (C) if the Common Stock is not quoted on the NASDAQ, the bid
price for a share of Common Stock in the over-the-counter market as
reported by the National

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Quotation Bureau Incorporated (or any similar organization or agency
succeeding to its functions of reporting prices), or (D) if the Common
Stock is no longer publicly traded, as determined by an investment
banking firm selected in good faith by the Board of Directors based
upon the price that would be paid by a willing buyer of the shares at
issue, in a sale process designed to maximize value and attract a
reasonable number of participants to provide a fair determination of
such value, provided, that none of the transactions related to the
foregoing shall include purchases by any "affiliate" (as defined in
Rule 12b-2 under the Securities Act of 1933) of the Corporation.

(iii) The conversion rate in effect at any time
for conversion of the Series E Preferred Stock (the "Preferred Stock
Rate") shall be the quotient obtained by dividing the Original Issue
Price (as defined above) by the Conversion Price, calculated as
provided in Section 6(b)(v).

(iv) "Convertibility Date" means the later of (i)
the expiration or termination of any applicable waiting period under
the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, in
respect of the transactions contemplated by the Purchase Agreement, and
(ii) such time as the Corporation's stockholders have approved the
conversion rights of the Series E Preferred Stock, including the
issuance of Common Stock upon the conversion thereof.

(v) The conversion price shall initially be
$3.00 (the "Conversion Price"). The initial Conversion Price shall be
adjusted from time to time in accordance with the provisions of Section
7. All references to the Conversion Price herein shall mean the
Conversion Price as so adjusted.

(c) Automatic Conversion Prior to Liquidation. In the
event of a liquidation of the Corporation, the Conversion Rights shall be
automatically exercised at the close of business on the first full business day
preceding the date fixed for the payment of any amounts distributable on
liquidation to the holders of Common Stock.

(d) Fractional Shares. No fractional shares of Common
Stock shall be issued upon conversion of the Series E Preferred Stock. All
shares of Common Stock (including fractions thereof) issuable upon conversion of
more than one share of Series E Preferred Stock by a holder shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share. In lieu of any fractional shares to which the holder
would otherwise be entitled, the Corporation shall pay cash equal to such
fractional share of Common Stock multiplied by the Closing Price of the Common
Stock on the business day immediately prior to the date on which conversion is
deemed to occur (as determined in subsection 6(e)(ii) below).

(e) Mechanics of Conversion.

(i) In order for a holder of Series E Preferred
Stock to convert shares of Series E Preferred Stock into shares of
Common Stock, such holder shall surrender the certificate or
certificates for such shares of Series E Preferred Stock, at the office
of the

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transfer agent for the Series E Preferred Stock (or at the principal
office of the Corporation if the Corporation serves as its own transfer
agent), together with written notice that such holder elects to convert
all or any number of the shares of the Series E Preferred Stock
represented by such certificate or certificates. Such notice shall
state such holder's name or the names of the nominees in which such
holder wishes the certificate or certificates for shares of Common
Stock to be issued.

(ii) If required by the Corporation, certificates
surrendered for conversion shall be endorsed or accompanied by a
written instrument or instruments of transfer, in form satisfactory to
the Corporation, duly executed by the registered holder or his, her or
its attorney duly authorized in writing. Provided that the certificates
of the Series E Preferred Stock have been surrendered as provided
above, the Corporation shall, as soon as practicable, issue and deliver
at such office to such holder of Series E Preferred Stock, or to his,
her or its nominees, a certificate or certificates for the number of
shares of Common Stock to which such holder shall be entitled, together
with cash in lieu of any fraction of a share. In the event less than
all shares represented by such certificate are converted, a new
certificate shall be issued by the Corporation representing the
unconverted shares. Such conversion shall be deemed to have been made
at the close of business on the date of such surrender of the
certificates representing the shares of Series E Preferred Stock to be
converted, and the person entitled to receive the shares of Common
Stock issuable upon such conversion shall be treated for all purposes
as the record holder of such shares of Common Stock on such date.

(f) Reservation of Common Stock. The Corporation shall,
at all times when the Series E Preferred Stock shall be outstanding, reserve and
keep available (free from preemptive rights) out of its authorized but unissued
stock, for the purpose of issuing upon conversion of the Series E Preferred
Stock, such number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding Series E Preferred Stock. All shares of Common
Stock so issuable shall, upon issuance, be duly and validly issued and fully
paid and nonassessable. Before taking any action that would cause an adjustment
reducing the Conversion Price below the then par value of the shares of Common
Stock issuable upon conversion of the Series E Preferred Stock, the Corporation
will take any corporate action which may, in the opinion of its counsel, be
necessary in order that the Corporation may validly and legally issue fully paid
and nonassessable shares of Common Stock at such adjusted Conversion Price.

(g) Notices. Any notice required herein shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified, (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (iii) five business days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (iv) one business day after
deposit with a nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All notices shall be addressed
to each holder of record at the address of such holder appearing on the books of
the Corporation.

(h) Payment of Taxes. The Corporation will pay all taxes
(other than taxes based upon income or gross receipts) and other governmental
charges that may be imposed with

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respect to the issue or delivery of shares of Common Stock upon conversion of
shares of Series E Preferred Stock, excluding any tax or other charge imposed in
connection with any transfer involved in the issue and delivery of shares of
Common Stock in a name other than that in which the shares of Series E Preferred
Stock so converted were registered.

7. Antidilution Adjustments. The number and kind of securities
issuable upon the conversion of the Series E Preferred Stock shall be subject to
adjustment, without duplication, from time to time upon the happening of certain
events occurring on or after the Original Issue Date as follows:

(a) Adjustment for Stock Splits and Combinations. In case
the Corporation shall (i) subdivide its outstanding Common Stock into a greater
number of shares, (ii) combine its outstanding Common Stock into a smaller
number of shares, (iii) pay a dividend or make a distribution on its outstanding
Common Stock in shares of its capital stock or (iv) issue by reclassification of
its outstanding Common Stock (whether pursuant to a merger or consolidation or
otherwise) any other shares of capital stock of the Corporation, the Series E
Preferred Stock surrendered for conversion after the record date fixed by the
Board of Directors for such subdivision, combination, dividend, distribution or
reclassification shall be entitled to receive the aggregate number and kind of
shares of capital stock of the Corporation that, if this Series E Preferred
Stock had been converted immediately prior to such record date at the Conversion
Price then in effect, such holder would have been entitled to receive by virtue
of such subdivision, combination, dividend, distribution or reclassification;
and the Conversion Price shall be deemed to have been adjusted after such record
date to apply to such aggregate number and kind of shares. Such adjustment shall
be made successively whenever any of the events listed above shall occur.

(b) Adjustment for Dividends and Distributions. In case
the Corporation shall pay a dividend or make a distribution on any class of
capital stock of the Corporation in shares of Common Stock, the Conversion Price
in effect immediately prior to the record date for the determination of
stockholders entitled to receive such dividend or distribution shall be reduced
by multiplying such Conversion Price by a fraction of which (A) the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the day immediately prior to such record date and (B) the
denominator shall be the sum of such number of shares and the total number of
shares issued in such dividend or other distribution.

(c) Adjustment for Rights to Acquire Common Stock Below
Market Price. Subject to Section 7(m) below, in case the Corporation shall issue
to all holders of Common Stock rights or warrants entitling them to subscribe
for or purchase Common Stock at a price per share less than the current market
price per share (as determined pursuant to Section 7(h) below), the Conversion
Price in effect from and after the record date therefor shall be reduced so that
it shall equal the price determined by multiplying the Conversion Price in
effect immediately prior to such record date by a fraction, of which (i) the
numerator shall be the number of shares of Common Stock outstanding on such
record date plus the number of shares of Common Stock which the aggregate
offering price of the total number of shares of Common Stock so offered for
subscription or purchase would purchase at such current market price and (ii)
the denominator shall be the number of shares of Common Stock outstanding on
such record date plus the number of additional shares of Common Stock so offered
for subscription or purchase. For the purpose

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of this Section 7(c), the issuance of rights or warrants to subscribe for or
purchase securities convertible into Common Stock shall be deemed to be the
issuance of rights or warrants to purchase the Common Stock into which such
securities are convertible (without regard to any antidilution provision
contained therein for a subsequent adjustment of such number) at an aggregate
offering price equal to the aggregate offering price of such securities plus the
minimum aggregate amount (if any) payable upon (or in connection with) the
exercise of such securities for Common Stock. Such adjustment shall be made
successively whenever such a record date is fixed. In case such rights or
warrants are not issued after such a record date has been fixed, the Conversion
Price shall be readjusted to the Conversion Price which would have been in
effect if such record date had not been fixed.

(d) Adjustment for Distribution of Debt or Assets. In
case the Corporation shall distribute to all holders of Common Stock (whether
pursuant to a merger or consolidation or otherwise) evidences of its
indebtedness or assets (excluding shares of capital stock of the Corporation and
cash dividends out of retained earnings), or rights to subscribe for Common
Stock at a price less than the current market price per share (excluding those
referred to in Section 7(c) above), then in each such case the Conversion Price
in effect from and after the record date therefor shall be adjusted so that it
shall equal the price determined by multiplying the Conversion Price in effect
immediately prior to such record date by a fraction, of which (i) the numerator
shall be the current market price per share (determined as provided in Section
7(h) below) of the Common Stock on such record date less the fair market value
(as determined by the Board of Directors, whose determination in good faith
shall be conclusive) of the portion of the evidences of indebtedness or assets
so distributed or of such rights to subscribe applicable to one share of Common
Stock and (ii) the denominator shall be such current market price per share of
Common Stock. Such adjustment shall be made successively whenever any such a
record date is fixed. In case such distribution is not made after such a record
date has been fixed, the Conversion Price shall be readjusted to the Conversion
Price which would have been in effect if such record date had not been fixed.

(e) Adjustment for Sales of Common Stock Below Market
Price (But Above Conversion Price). If the Corporation shall issue any
additional shares of Common Stock (other than as provided in Sections 7(a)
through 7(d) above) at a price per share less than the current market price per
share of Common Stock but above the Conversion Price in respect of the Series E
Preferred Stock, then the Conversion Price shall be adjusted to the price
determined by multiplying the Conversion Price by a fraction of which (i) the
numerator shall be (A) the sum of (1) the number of shares of Common Stock
outstanding immediately prior to the issuance of such additional shares of
Common Stock multiplied by the current market price and (2) the consideration,
if any, received and deemed received by the Corporation upon the issuance of
such additional shares of Common Stock (B) divided by the total number of shares
of Common Stock outstanding immediately after the issuance of such additional
shares of Common Stock, and (ii) the denominator shall be the current market
price.

(f) Adjustment for Sales of Common Stock Below Conversion
Price. If the Corporation shall issue any additional shares of Common Stock
(other than as provided in Sections 7(a) through 7(e) above) at a price per
share less than the Conversion Price, then the Conversion Price shall be
adjusted to the price determined by multiplying the Conversion Price

10


times a fraction of which (i) the numerator shall be (A) the sum of (1) the
number of shares of Common Stock outstanding immediately prior to the issuance
of such additional shares of Common Stock multiplied by the Conversion Price and
(2) the consideration, if any, received and deemed received by the Corporation
upon the issuance of such additional shares of Common Stock (B) divided by the
total number of shares of Common Stock outstanding immediately after the
issuance of such additional shares of Common Stock, and (ii) the denominator
shall be the Conversion Price.

(g) Certain Determinations.

(i) In case the Corporation shall issue any
security or evidence of indebtedness that is convertible into or
exchangeable for Common Stock ("Convertible Security"), or any warrant,
option or other rights to subscribe for or purchase Common Stock or any
Convertible Security (together with Convertible Securities, "Common
Stock Equivalent"), or if, after any such issuance, the price per share
for which such additional shares of Common Stock may be issuable
thereunder is amended, then, for purposes of Sections 7(e) and (f), (A)
the maximum number of additional shares of Common Stock issuable
pursuant to all such Common Stock Equivalents (without regard to any
antidilution provision contained therein for a subsequent adjustment of
such number) shall be deemed to have been issued as of the earlier of
(1) the date on which the Corporation shall enter into a firm contract
for the issuance of such Common Stock Equivalent or (2) the date of
actual issuance of such Common Stock Equivalent, and (B) the aggregate
consideration for such maximum number of additional shares of Common
Stock shall be deemed to be the minimum consideration received and
receivable by the Corporation for the issuance of such additional
shares of Common Stock pursuant to such Common Stock Equivalent. No
adjustment of the Conversion Price shall be made under this paragraph
upon the issuance or deemed issuance of any shares of Common Stock
pursuant to the exercise of any conversion or exchange rights of any
Convertible Security or pursuant to the exercise of any warrants,
options, or other subscription or purchase rights, if any adjustments
shall previously have been made in the Conversion Price then in effect
upon the issuance of such Convertible Securities, warrants, options or
other rights pursuant hereto.

(ii) The following provisions shall be applicable
to making of adjustments in the Conversion Price hereinbefore provided
in Sections 7(c), (d), (e) and (f):

(A) The consideration received by the
Corporation shall be deemed to be the following:

(1) (x) To the extent that any
additional shares of Common Stock or any
Common Stock Equivalents shall be issued for
cash consideration, the consideration
received by the Corporation therefor, or,
(y) if such additional shares of Common
Stock or Common Stock Equivalents are
offered by the Corporation for subscription,
the subscription price, or, (z) if such
additional shares of Common Stock or Common
Stock Equivalents

11


are sold to underwriters or dealers for
public offering without a subscription
offering, the initial public offering price,
in any such case excluding any amounts paid
or receivable for accrued interest or
accrued dividends and without deduction of
any compensation, discounts, commissions or
expenses paid or incurred by the Corporation
for and in the underwriting of, or otherwise
in connection with, the issue thereof;

(2) To the extent that such
issuance shall be for a consideration other
than cash, then, except as herein otherwise
expressly provided, the fair market value of
such consideration at the time of such
issuance as determined in good faith by the
Board of Directors. In any case in which the
consideration to be received or paid shall
be other than cash, the Board of Directors
of the Corporation shall notify promptly
each holder of the Series E Preferred Stock
of its determination of the fair market
value of such consideration;

(3) The consideration for any
additional shares of Common Stock issuable
pursuant to any Common Stock Equivalents
shall be the consideration received by the
Corporation for issuing such Common Stock
Equivalents, plus the additional
consideration payable to the Corporation
upon the exercise, conversion or exchange of
such Common Stock Equivalents; and

(4) In case of the issuance at
any time of any additional shares of Common
Stock or Common Stock Equivalents in payment
or satisfaction of any dividend upon any
class of stock other than Common Stock, the
Corporation shall be deemed to have received
for such additional shares of Common Stock
or Common Stock Equivalents a consideration
equal to the amount of such dividend so paid
or satisfied.

(B) Upon the expiration of the right to
convert, exchange or exercise any Common Stock
Equivalent the issuance of which effected an
adjustment in the Conversion Price, if any such
Common Stock Equivalent shall not have been
converted, exercised or exchanged, (1) the number of
shares of Common Stock deemed to be issued and
outstanding by reason of the fact that they were
issuable upon conversion, exchange or exercise of any
such Common Stock Equivalent shall no longer be
computed as set forth above, (2) the Conversion Price
shall forthwith be readjusted and thereafter be the
price which it would have been (but reflecting any
other adjustments in the Conversion Price made
pursuant to the provisions of this Section 7 after
the issuance of such Common Stock Equivalent) had the
adjustment of the Conversion Price made upon the
issuance or sale of such Common Stock Equivalent been
made on the basis of the issuance only of the number
of additional shares of Common

12


Stock actually issued upon exercise, conversion or
exchange of such Common Stock Equivalent, and (3)
thereupon only the number of additional shares of
Common Stock actually so issued shall be deemed to
have been issued and only the consideration actually
received by the Corporation (computed as in clause
(A) above) shall be deemed to have been received by
the Corporation.

(iii) The number of shares of Common Stock at any
time outstanding shall not include any shares thereof then directly or
indirectly owned or held by or for the account of the Corporation or
its subsidiaries.

(iv) No adjustments of the Conversion Price shall
be made pursuant to Sections 7(c), (e) and (f) upon the issuance of
shares of Common Stock that are issued pursuant to (x) any employee
benefit plan, program or policy approved by the Board of Directors of
the Corporation, including thrift plans, stock purchase plans, stock
bonus plans, stock options plans, employee stock ownership plans or
other incentive or profit sharing arrangements, for the benefit of
employees, officers or directors of the Corporation or its "affiliates"
(as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as
amended) or (y) Acquisitions made by the Corporation.

(h) Current Market Price. For the purpose of any
computation under Sections 7(c), (d) and (e) above, the current market price
shall be deemed to be the following:

(i) With respect to a bonafide underwritten
public offering, the offering price agreed to by the underwriter;

(ii) With respect to binding agreements made by
the Corporation to issue shares of Common Stock for a price that is (A)
determined as of the date of the agreement with reference to a market
price contemporaneous with the date of the binding agreement and (B)
without full adjustment to the Closing Price on the day of issuance,
the price as determined by such binding agreement; or

(iii) With respect to all other situations, the
average of the daily Closing Prices for 30 consecutive trading days
commencing 45 trading days before the date in question.

(i) Deferral of Share Issuance. In any case in which this
Section 7 shall require that an adjustment as a result of any event becomes
effective from and after a record date, the Corporation may elect to defer until
after the occurrence of such event (i) issuing to the holder of Series E
Preferred Stock converted after such record date and before the occurrence of
such event the additional shares of Common Stock issuable upon such conversion
over and above the shares issuable on the basis of the Conversion Price in
effect immediately prior to adjustment and (ii) paying to such holder any amount
in cash in lieu of a fractional share of Common Stock pursuant to Section 6(d)
above. In lieu of the shares the issuance of which is deferred pursuant to this
Section 7(i), the Corporation shall issue or cause a transfer agent to issue due
bills or other appropriate evidence of the right to receive such shares promptly
after the occurrence of such event.

13


(j) De Minimis Adjustments. Any adjustment in the
Conversion Price otherwise required by this Section 7 to be made may be
postponed until the date of the next adjustment otherwise required to be made if
such adjustment (together with any other adjustments postponed pursuant to this
Section 7 and not theretofore made) would not require an increase or decrease of
more than 1% in such price, but in the case of an adjustment required as a
result of a dividend or distribution on any class of capital stock of the
Corporation in shares of Common Stock, such adjustment must be made no later
than the earlier of (a) 3 years after the date of the stock dividend or
distribution or (b) the date as of which the aggregate stock dividends or
distributions for which adjustment of the Conversion Price has not previously
been made total at least 3% of the issued and outstanding capital stock of the
Corporation with respect to which such stock dividends or distributions were
made. All calculations under this Section 7 shall be made to the nearest cent or
to the nearest 1/100th of a share, as the case may be.

(k) Applicability to Other Shares. In case at any time,
as a result of an adjustment made pursuant to Section 7(a)(iii) or (iv) above,
the holders of the Series E Preferred Stock thereafter surrendered for
conversion shall become entitled to receive any shares of capital stock of the
Corporation other than Common Stock, the number and kind of such other shares so
receivable upon conversion of Series E Preferred Stock shall thereafter be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in clauses (a) to (g), inclusive, above, and the other provisions of
this Section 7 with respect to the Common Stock shall apply on like terms to any
such other shares.

(l) Board Determinations. The Board of Directors may make
such reductions in the Conversion Price, in addition to those required by this
Section 7, as shall be determined by the Board of Directors to be advisable to
avoid taxation so far as practicable of any dividend of stock or stock rights or
any event treated as such for federal income tax purposes to the recipients. The
Board of Directors shall have the power to resolve any ambiguity or correct any
error in this Section 7, and (absent manifest error by the Board of Directors)
its action in so doing shall be final and conclusive.

(m) Rights Plan. With respect to any stockholder rights
plan (the "Rights Plan") pursuant to which "rights" would be issued or issuable
to stockholders of the Corporation, no adjustment shall be made to the
Conversion Price as a result of such Rights Plan in the event that an
appropriate amount of "rights" are either (i) reserved for issuance in
connection with the issuance of Conversion Shares to the holders of Series E
Preferred Stock or (ii) are issued to holders of Series E Preferred Stock on an
as converted basis. Unless rights are so issued pursuant to clause (ii) of this
Section 7(m), if and when the rights become exercisable, an appropriate
adjustment to the Conversion Price in accordance with the terms of the Rights
Plan shall be made pursuant to this Section 7.

(n) Notices of Adjustment. In each case of an adjustment
or readjustment of the Conversion Price for the number of shares of Common Stock
or other securities issuable upon conversion of shares of Series E Preferred
Stock, if the Series E Preferred Stock is then convertible pursuant to Section
6, the Corporation, at its expense, shall compute such adjustment or
readjustment in accordance with the provisions hereof and prepare a certificate
showing such adjustment or readjustment, and shall deliver such certificate to
each registered holder of Series

14


E Preferred Stock. The certificate shall set forth such adjustment or
readjustment, showing in detail the facts upon which such adjustment or
readjustment is based, including (without limitation) a statement of (i) the
consideration received or deemed to be received by the Corporation for any
additional securities issued or sold or deemed to have been issued or sold, (ii)
the Conversion Price at the time in effect, (iii) the number of additional
securities and (iv) the type and amount, if any, of other property which at the
time would be received upon conversion of the Series E Preferred Stock.

(o) Notices of Record Date. Upon the fixing by the Board
of Directors of a record date for the purpose of determining the holders of any
class of securities who are entitled to receive any dividend or other
distribution, including, but not limited to in connection with any capital
reorganization of the Corporation, any reclassification or recapitalization of
the capital stock of the Corporation, any merger or consolidation of the
Corporation with or into any other corporation, or any voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the Corporation shall
send to each holder of the Series E Preferred Stock at least 20 calendar days
prior to the record date specified therein a notice specifying (A) the record
date for the purpose of such dividend or distribution and a description of such
dividend or distribution, (B) the date on which any such reorganization,
reclassification, transfer, consolidation, merger, dissolution, liquidation or
winding up is expected to become effective, and (C) the date, if any, that is to
be fixed as to when the holders of record of Common Stock (or other securities)
shall be entitled to exchange their shares of Common Stock (or other securities)
for securities or other property deliverable upon such reorganization,
reclassification, transfer, consolidation, merger, dissolution, liquidation or
winding up.

THE REMAINDER OF THIS PAGE INTENTIONALLY BLANK.

15


IN WITNESS WHEREOF, QUANTA SERVICES, INC. has caused this Certificate
of Designation to be executed on its behalf by its Vice President, General
Counsel and Secretary, and attested to by its Assistant Secretary, this 20th day
of December, 2002.

QUANTA SERVICES, INC.

By: /s/ DANA A. GORDON

Name: Dana A. Gordon

Title: Vice President, General Counsel
and Secretary

THE UNDERSIGNED, the Assistant Secretary of Quanta Services,
Inc. hereby acknowledges, in the name and on behalf of said corporation, the
foregoing Certificate of Designation to be the corporate act of said corporation
and further certifies that, to the best of his knowledge, information and
belief, the matters and facts set forth therein with respect to the approval
thereof or otherwise required to be verified under oath are true in all material
respects, under the penalties of perjury.

By: /s/ PAMELA L. KUNKEMOELLER

Name: Pamela L. Kunkemoeller

Title: Assistant Secretary

SIGNATURE PAGE TO
CERTIFICATE OF DESIGNATION