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                                                                   EXHIBIT 10.11

THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR BLUE SKY
LAWS (COLLECTIVELY, THE "ACTS"), AND NO SUCH REGISTRATION IS CONTEMPLATED. ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL. IN THE ABSENCE OF ANY EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACTS, THIS PROMISSORY NOTE MAY NOT BE OFFERED,
SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACTS.

         THIS PROMISSORY NOTE IS SUBORDINATED TO THE SENIOR INDEBTEDNESS OWED TO
COMERICA BANK-TEXAS, PURSUANT TO THAT CERTAIN SUBORDINATION AGREEMENT, DATED AS
OF JULY 18, 2001.

                                  SUBORDINATED
                                 PROMISSORY NOTE


$1,584,830.28 (U.S.)                                               July 18, 2001
                                                                  Houston, Texas


         FOR VALUE RECEIVED, and intending to be legally bound, STERLING
CONSTRUCTION COMPANY, a corporation organized under the laws of the State of
Delaware (the "Maker"), promises to pay to the order of JOSEPH P. HARPER, SR.
(the "Payee") at his address located at 2715 Timberjack Place, The Woodlands,
Texas 77380, in lawful money of the United States of America and in immediately
available funds, ONE MILLION FIVE HUNDRED EIGHTY-FOUR THOUSAND EIGHT HUNDRED
THIRTY AND 28/100 DOLLARS ($1,584,830.28), together with interest thereon at the
rate of twelve percent (12%) per annum on the unpaid balance from the date
hereof until paid.

         This Promissory Note (the "Note") is due and payable as follows,
to-wit: (1) eleven (11) installments of principal in the amount of one hundred
thirty-two thousand sixty-nine and 19/100 dollars ($132,069.19) plus accrued
interest is due and payable quarterly commencing on September 30, 2001, and (2)
one hundred thirty-two thousand sixty-nine and 19/100 dollars ($132,069.19) plus
accrued interest is due and payable on September 30, 2004 (the "Maturity Date").
Maker promises to pay to the order of Payee at the place for payment and
according to the terms of payment the principal amount plus interest at the
rates stated above. All unpaid amounts shall be due by the Maturity Date. All
payments shall be first applied to interest and the balance to principal. This
Note may be prepaid, at any time, in whole or in part, without penalty.

         At the option of the legal holder hereof and without notice, the
principal sum remaining unpaid hereon, together with accrued interest thereon,
shall become at once due and payable at the place of payment aforesaid in case
default shall occur in the payment, when due, of any installment of principal or
interest in accordance with the terms hereof. If this Note is submitted to an
attorney for collection or if legal proceedings are commenced to collect on this
Note or if it is collected through bankruptcy or other judicial proceedings,
then Maker shall pay Payee all costs of collection, including reasonable
attorney's fees and court costs in addition to other amounts due.

         Interest on the debt evidenced by this Note shall not exceed the
maximum amount of nonusurious interest that may be contracted for, taken,
reserved, charged, or received under law.

         THIS PROMISSORY NOTE SHALL BE SUBJECT TO AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO
ANY CONFLICTS OF LAW PRINCIPLES.

         IN WITNESS WHEREOF, the undersigned has caused this Subordinated
Promissory Note to be executed at the place and on the date first above
appearing.

                                    STERLING CONSTRUCTION COMPANY


                                    By:    /s/ Patrick T. Manning
                                       -----------------------------------------
                                    Name:  Patrick T. Manning
                                         ---------------------------------------
                                    Title: President and Chief Executive Officer
                                          --------------------------------------