<PAGE>

                                                                  EXHIBIT 10.111



                              CONTRACT AGREEMENT


THIS AGREEMENT, made and entered into this 24TH day of AUGUST, 1999. by and
between the STATE OF ARIZONA, acting by and through its State Engineer duly
authorized by the Department of Transportation to enter into such agreement,
party of the first part, and ___________________________
                        MEADOW VALLEY CONTRACTORS, INC.
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hereinafter called the Contractor, party of the second part.

WITNESSETH: That the said Contractor, for in consideration of the sum to be
paid him by said State Arizona in the manner and at the time hereinafter
provided, and of the other covenants and agreements herein contained, hereby
agrees, for himself, heirs, administrators, successors and assigns as follows:

     ARTICLE I - SCOPE OF WORK: The Contractor shall perform in a workmanlike
and substantial manner and to the satisfaction of the State Engineer, all the
work specified under TRACS/Project No.

089A YV 355 H274101C  STP-366(19)P
PRESCOTT-FLAGSTAFF HIGHWAY
(Cottonwood-Cornville Road)

and furnish at his own cost and expense all necessary machinery, tools,
apparatus, materials and labor to complete the work in the most substantial and
workmanlike manner according to the Plans and Specifications therefor on file
with the State Engineer and such modifications of the same and other directions
that may be made by the State Engineer as provided herein.

     ARTICLE II - CONTRACT DOCUMENTS: It is further agreed that the Proposal,
Plans, Standard Specifications, Special Provisions, Contract Bond(s) and any and
all Supplementary Agreements, and any and all requirements necessary to complete
the work in a substantial and acceptable manner, and any and all equipment and
progress statements required, are hereby referred to and made a part of this
contract, and shall have the same force and effect as though all of the same
were fully inserted herein.

     ARTICLE III - WARRANTY: The Contractor expressly warrants that he is free
from obligation of any other person or persons for services rendered, or
supposed to have rendered, in the procurement of this contract. He further
agrees that any breach of the Warranty shall constitute adequate cause for the
annulment of the Contract by the State of Arizona and that the State of Arizona
may retain to its own use from any sums of money due or become due thereunder,
an amount thereof equal to any brokerage, commission, or percentage so paid, or
agreed to be paid.

     ARTICLE IV - TIME OF COMPLETION: The Contractor further covenants and
agrees that all of the said materials shall be furnished and delivered and all
of the said labor shall be done and performed in every respect to the
satisfaction and approval of the State Engineer and that the said work shall be
turned over to the State Engineer, complete and ready for use, on or before the
specified time herein. The work shall be free am discharged of all claims and
demands whatsoever for, or on account of any and all labor and materials used
or furnished to be used in said work.

     It is expressly understood and agreed that in case of failure on the part
of the Contractor, for any reason, except with the written consent of the State
Engineer, to complete the entire work to the satisfaction of the State Engineer,
and within the aforesaid time limit, the party of the first part shall deduct
from any money due, or which may become due the Contractor, as liquidated
damages, an amount in accordance with Subsection 108.09 of the Contract
Specifications.

     If no money shall be due the Contractor, the State shall have a cause of
action to recover against the Contractor in a court of competent jurisdiction,
liquidated damages, in accordance with Subsection 108.09 of the Contract
Specifications, said deduction to be made, or said sum to be recovered, not as a
penalty, but as liquidated damages; provided, however, that upon receipt of
written notice from the Contractor, of the existence of causes, as herein
provided, over which said Contractor has no control and which must delay the
completion of said work or any delay occasioned by the Arizona Department of
Transportation, the State Engineer may extend the period hereinbefore specified
for the completion of said work in accordance with the Specifications and in
such case, the Contractor shall become liable for said liquidated damages for
delays commencing from date said extension period shall expire.

     After the date as set up in Contract plus any extension granted, no further
 payments shall be made the Contractor until all work is completed and accepted
 by the State engineer. It is also agreed that the date of completion shall be
 that upon which the work is accepted by the State Engineer.

     ARTICLE V - CLAIMS FOR EXTRA WORK: It is distinctly understood and agreed
 that no claim for extra work or materials, not specifically herein provided,
 done or furnished by the Contractor, will be allowed by the State Engineer, nor
 shall the Contractor do any work or furnish any materials not covered by these
 Specifications and Contract, unless such work is ordered in writing by the
 State Engineer. In no event shall the Contractor incur any liability by reason
 of any oral direction or instruction that he may be given by the State
 Engineer, or his authorized representatives. It is the intent and meaning of
 this Article that all orders, directions, instructions, not contained in the
 Plans, Specifications, and Special Provisions, pertaining to the work shall be
 in writing, and the Contractor hereby waives any claims for compensation for
 work done, or materials furnished in violation thereof.

     ARTICLE VI - MISUNDERSTANDING OR DECEPTION: The party of the second part
 agrees that he has investigated the site of the work and all parts and
 appurtenances thereto and hereby waives any right to plead misunderstanding or
 deception as to location, character of work or materials, estimates of
 quantities or other conditions surrounding or being a part of the work and
 understands that the quantities given in the Bidding Schedule are approximate
 only, and hereby agrees to accept the quantities as actually placed and finally
 determined upon the completion of the work, in accordance with the Contract
 Documents.

     ARTICLE VII - PAYMENTS: For and in consideration of the faithful
performance of the work herein embraced, as set forth in the Contract Agreement,
Specifications, Special Provisions, Bidding Schedule and all general and
detailed Specifications and Plans, which are a part hereof, and in accordance
with the directions of the State Engineer and to his satisfaction or his
authorized agents, the said State of Arizona agrees to pay to said Contractor
the amount earned, computed from the actual quantities of work performed, as
shown by the estimates of the State Engineer, and the unit prices named in the
attached Bidding Schedule and Supplementary Agreements made a part hereof, and
to make such payments in the manner and the time provided in the specifications
hereto appended.

                                                                    Sheet 1 of 2
<PAGE>

     ARTICLE VIII - IT IS EXPRESSLY UNDERSTOOD AND AGREED that no work shall be
done nor any obligations incurred under this contract during any fiscal year
which are in excess of the funds programmed and budgeted for this project for
that fiscal year.

     ARTICLE IX - THE CONTRACTOR SHALL INDEMNIFY AND SAVE HARMLESS THE STATE,
its officers and employees, from all suits, actions or claims of any character
brought because of any injuries or damage received or sustained by any person,
persons or property on account of the operations of the said contractor or an
account of or in consequence of any neglect in safeguarding the work; or through
use of unacceptable materials in constructing the work; or because of any act or
omission, neglect or misconduct of said contractor; or because of any claims or
amounts recovered from any infringements of patent, trademark or copyright; or
from any claims or amounts arising or recovered under the Workmen's Compensation
Act or any other law, ordinance, order or decree, except the contractor is not
required to indemnify or save harmless the State from liability arising from the
negligence of the State.

     The contractor shall indemnify and save harmless any county or incorporated
city, its officers and employees, within the limits of which county or
incorporated city work is being performed, all in the same manner and to the
same extent as provided in the above paragraph.

     IT IS FURTHER UNDERSTOOD AND AGREED that all work required to be done under
this contract in excess of the funds now appropriated and budgeted for this
project shall not be done nor any obligation incurred therefor until such time
as the Legislature appropriates the additional funds and the same are budgeted
for this project by the Arizona Department of Transportation and in that event
the parties hereto are bound to continue performance of this contract to the
extent permitted by the funds so appropriated and budgeted.

     In the event that no funds are appropriated or budgeted for this project
for the succeeding fiscal year, then this contract shall be null and void,
except as to that portion for which funds have now been appropriated and
budgeted, therefore, and no right of action or damages shall accrue to the
benefit of the parties hereto as to that portion of the contract that may so
become null and void.

     All parties are hereby put on notice that this contract (agreement) is
subject to cancellation by the Governor pursuant to Arizona Revised Statutes
Section 38-511.

     IT IS ALSO UNDERSTOOD AND AGREED that this contract is subject to A.R.S.
28-1824, 28-1825, 28-1826, together with all other limitations pursuant to the
applicable laws of the State of Arizona relating to public contracts and
expenditures.


089A YV 355 H274101C  STP-366(19)P
PRESCOTT-FLAGSTAFF HIGHWAY
(Cottonwood-Cornville Road)

Witness our hands and seals this  24TH day of     AUGUST     19  99
                                  ----         -----------      ----

                                  STATE OF ARIZONA





                                  By:  /s/ [ILLEGIBLE]
                                      --------------------------------------
                                      Department of Transportation

EVIDENCE OF AUTHORITY TO SIGN
THE CONTRACT MUST BE ON FILE
WITH THE DEPARTMENT, OTHERWISE
IT MUST BE FURNISHED WITH THE
PROPOSAL.


                                  PARTY OF THE FIRST PART

                                  ____________________________________________


                                  By: /s/ Bradley E. Larson     President
                                      ----------------------------------------
                                      Contractor

                                          Meadow Valley Contractors, Inc.


Attest: /s/ Robert W. Bottcher    PARTY OF THE SECOND PART
       -----------------------
            Seal


                                                                      Article IX
                                                                 Revised 6/15/98
                                                              Contract Agreement
                                                                    Sheet 2 of 2

<PAGE>

                                                                   Page 15 of 16

                                 BID SCHEDULE

                             089A YV 355 H274101C

<TABLE>
<CAPTION>
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  Item No.               Item Description                        Unit      Quantity       Unit Price          Extended Amount
-------------------------------------------------------------------------------------------------------------------------------
<S>            <C>                                               <C>       <C>            <C>                 <C>
CONCRETE BOX CULVERT, STA 236+57.90
-------------------------------------------------------------------------------------------------------------------------------
  2030401 D    DRAINAGE EXCAVATION                               CU.YD             70          5.00                350.00
-------------------------------------------------------------------------------------------------------------------------------
  2030501 D    STRUCTURAL EXCAVATION                             CU.YD            755         10.00              7,550.00
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  2030506 D    STRUCTURE BACKFILL                                CU.YD            463         20.00              9,260.00
-------------------------------------------------------------------------------------------------------------------------------
  6010002 D    STRUCTURAL CONCRETE (CLASS S) (F'C = 3,000)       CU.YD            279        275.00             76,725.00
-------------------------------------------------------------------------------------------------------------------------------
  6050002 D    REINFORCING STEEL                                   LB          46,236          0.40             18,494.40
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</TABLE>

                                                                 "A" Amount
                                                          ----------------------
                                 CONSTRUCTION COST BID:         4,494,190.12
                                                          ----------------------