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<SEC-DOCUMENT>0000874238-09-000032.txt : 20100115
<SEC-HEADER>0000874238-09-000032.hdr.sgml : 20100115
<ACCEPTANCE-DATETIME>20091104175424
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000874238-09-000032
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20091104

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			STERLING CONSTRUCTION CO INC
		CENTRAL INDEX KEY:			0000874238
		STANDARD INDUSTRIAL CLASSIFICATION:	HEAVY CONSTRUCTION OTHER THAN BUILDING CONST - CONTRACTORS [1600]
		IRS NUMBER:				251655321
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		2751 CENTERVILLE RD.
		STREET 2:		SUITE 3131
		CITY:			WILMINGTON
		STATE:			DE
		ZIP:			19803
		BUSINESS PHONE:		3024789170

	MAIL ADDRESS:	
		STREET 1:		20810 FERNBUSH LANE
		CITY:			HOUSTON
		STATE:			TX
		ZIP:			77073

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	OAKHURST CO INC
		DATE OF NAME CHANGE:	19950831

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	OAKHURST CAPITAL INC
		DATE OF NAME CHANGE:	19931130
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
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<TEXT>
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    <title>response.htm</title>
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CONSTRUCTION COMPANY, INC.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">20810
Fernbush</font></div>
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4, 2009</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By
Federal Express and facsimile to (703) 813-6968</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Terence
O'Brien, Branch Chief</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Securities
and Exchange Commission</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Division
of Corporate Finance</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">100 F
Street NE</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Washington,
D.C. 20549-4631</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Re:
Sterling Construction Company, Inc.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Form 10-K
for the fiscal year ended December 31, 2008, filed March 16, 2009</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Form 10-Q
for the period ended June 30, 2009, filed August 10, 2009</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">File No
1-31993</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Dear Mr.
O'Brien:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This
letter is in response to your comment letter to me dated October 6, 2009,
regarding the above-noted filings of Sterling Construction Company, Inc
("Sterling"). For your convenience, our responses, which are attached, are in
italics and are prefaced by the text of the Staff&#8217;s corresponding
comments.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
let me know if you have any questions or if we can provide additional
information or otherwise be of assistance in expediting the review
process.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Very
truly yours,</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">James H.
Allen, Jr.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Senior
Vice President and Chief Financial Officer</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Cc.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Jenn
Do, Staff Accountant, SEC</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Tracey
Houser, SEC</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Era
Anagnosti, SEC</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Brigitte
Lippmann, SEC</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Geoffrey
Walker, Esq., Andrews Kurth LLP</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Michael
P. Desormeaux, Grant Thornton LLP</font><br></div><br>
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        <div id="FTR">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">&#160;
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</font></div>
          <div style="WIDTH: 100%" align="center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">Response
of November 4, 2009 of Sterling Construction Company, Inc. to Comments of the
Securities and Exchange Commission of October 6,
2009</font></div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Form 10-K for the year ended
December 31, 2008</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Deferred Salary, page
42</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We note
your response to comment 8 of our letter dated July 29, 2009. Please clarify for
us, with a view toward future disclosure, how you determined to allocate the
amounts between Base Payroll Salary and Base Deferred Salary for each executive
officer.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Response:</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic">The Committee determined what it
believed to be an appropriate but low-end base salary and an appropriate maximum
</font><font style="DISPLAY: inline; FONT-STYLE: italic">total compensation
level</font><font style="DISPLAY: inline; FONT-STYLE: italic"> for each
executive. The difference between the two amounts was then allocated to
incentive compensation. The incentive compensation was divided equally between
Base Deferred Salary with its EBITDA goal and an Incentive Bonus with its
personal and financial </font><font style="DISPLAY: inline; FONT-STYLE: italic">goals.&#160; These
determinations</font><font style="DISPLAY: inline; FONT-STYLE: italic"> were
based partly on the Hay Group Report regarding comparable total
compensation,</font><font style="DISPLAY: inline; FONT-STYLE: italic"> and
partly on the personal judgment of the Committee members.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">In
future filings, we will clarify this decision-making process.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Exhibits, page
56</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We note
your response to comment 11 of our letter dated July 29, 2009 and see that you
have filed the schedules to the credit agreement as Exhibit 10.4 of the
September 10, 2009 amendment to your latest annual report. However, it appears
that other than Exhibit G<font style="DISPLAY: inline; FONT-WEIGHT: bold">,
</font>you have not filed the remaining exhibits to the credit agreement. Please
advise or otherwise file the exhibits with your next Exchange Act
report.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Response</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Through
inadvertence, the re-filing on September 10, 2009 of exhibits and schedules to
the Credit Agreement that you requested left out several exhibits. The
inadvertently omitted exhibits will be filed with our next Exchange Act
report.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">1. Summary of Business and
Significant Accounting Policies, page F7</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Organization and Business,
page F7</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt">3.</font></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We note
your response to comment 12 in our letter dated July 29, 2009, regarding your
assessment of the guidance in SFAS 131 for your identification of your operating
and reportable segment.</font></div>
      <div style="MARGIN-LEFT: 72pt; TEXT-INDENT: 90pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We note
that while you have four field offices (i.e., Reno, Houston, San Antonio/Austin
and Dallas/Fort Worth), your CODM manages and reviews performance on a project
by project basis. We further note that you had approximately 60 projects in
process as of December 31, 2008. It is unclear how you determined that your
individual projects are not operating segments, as your CODM regularly reviews
the financial results of the individual project. Further, paragraph 24 of SFAS
131 discusses the impact to the number of reportable segments when a large
number of operating segments have been identified. Please provide us,<font style="DISPLAY: inline; FONT-STYLE: italic">&#160;</font>with a better
understanding regarding your determination that your projects do not meet the
definition of operating segments in accordance with paragraphs 10-15 or SFAS
131. Please also tell us if the reports reviewed by your CODM group the projects
by office.</font></div>
      <div style="MARGIN-LEFT: 72pt; TEXT-INDENT: 90pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt;" face="Symbol, serif">&#183;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Please
also provide us with a better understanding as to how your CODM evaluates the
officers of each of your offices. For example, please explain how your CODM
evaluates the performance of Richard H. Buenting, President and Chief Executive
Officer of Road and Highway Builders, LLC Road and Highway Builders Inc. In this
regard, please explain if Mr. Buenting is evaluated based on the performance of
all projects or by the projects related to the Reno office.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
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          <div style="WIDTH: 100%" align="center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">Response
of November 4, 2009 of Sterling Construction Company, Inc. to Comments of the
Securities and Exchange Commission of October 6, 2009</font></div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Response</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">With
regard to the first bullet point of this comment, although the CODM does
regularly review financial results at the project level, we do not believe that
the individual projects are operating segments as defined in Paragraph 10 of
SFAS 131. Individual projects do not represent business activities since they do
not have the ability to continue as a going concern and individual projects are
not perpetual (they last from 12 months to 36 months). Individual projects do
not survive after they are completed and to consider an individual project as an
operating segment would imply&#160;&#160;our business is self
limiting.</font><br>&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">There
are many other activities of our business that are required in order for our
business to continue as a going concern in addition to performance of individual
projects, such as general business development efforts and the bidding process
for new contracts. In addition, many of the costs allocated to a project are not
specific costs that have been incurred for that project only, such as: project
bidding and management salaries, bonuses and related payroll expenses; indirect
labor and related payroll expenses; general liability, umbrella and inland
marine insurance; property taxes; depreciation; on-road fuel and equipment
repair and maintenance costs.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
Company&#8217;s resources are allocated on a project-by-project basis, taking into
account the Company&#8217;s success in bidding and negotiating specific contracts with
federal, state and local governmental agencies and the Company&#8217;s overall
operational and financial plans and strategies, and prevailing market
conditions. When a project ends, the crews are not released and the equipment is
not retired. During a project, those resources are transferred to other projects
as needed and to new projects when obtained.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
individual project report for each individual project details the materials,
labor and indirect overhead costs incurred and units performed by contractual
task (a typical project may have from 300 to 400 tasks), the re-forecasted total
estimated revenues and cost and units to be performed by contractual task, and
the billings to the customer by contractual task. These are the primary reports
used by the project managers and our CODM function to evaluate the status and
estimated profitability of individual projects and to take corrective action on
variances from estimates. These reports are also summarized by project manager,
field office and state, primarily to evaluate our project personnel and for
statutory reporting purposes, but are not used by our CODM for the overall
management of the business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">With
respect to the second bullet point of this comment, Mr. Buenting has an
employment contract which allows him to earn a bonus up to the amount of his
salary, which is comparable to our other field office managers. Under this
employment contract, we evaluate Mr. Buenting, like other project and field
office management, based on the results of the projects he manages and his
individual self-evaluations and achievement of predetermined personal goals. Mr.
Buenting&#8217;s evaluation is based in part on the performance of all projects he
manages (currently Nevada and Hawaii) and his assistance in bidding projects
throughout Sterling.&#160;&#160;While financial statements are prepared for Road
and Highway Builders, LLC, these financial statements are prepared for SEC
filing and for statutory purposes, such as preparation of tax returns and
preparation of state prequalification filings, and to perform the calculations
relating&#160;&#160;to Mr. Buenting&#8217;s 8 1/3 percent noncontrolling ownership
interest in RHB.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
maintain field offices in various locations to better facilitate oversight of
the crews and progress of individual projects and to maintain equipment near our
job sites. As a result, as noted above, at times financial information,
including information at the individual project level is aggregated and reviewed
at various levels within the Company for the purposes of evaluating personnel
and statutory reporting. However, the purpose of maintaining financial
information at that level is not to provide discreet financial information by
which the CODM can manage and evaluate the business at that
level.&#160;&#160;Furthermore, if not for the statutory requirements and
noncontrolling ownership interest calculations noted above, we would have no
reason to prepare financial information at the RHB level or to maintain RHB as a
stand-alone entity and it could be merged into the
Company.</font><br>&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">In
summary, we manage all of our operations based on a consistent and single
method, focusing on individual construction projects and those projects&#8217; results
and resource needs. We continue to believe, based on the single method by which
we manage our business, that we have one operating and reportable segment -
heavy civil construction.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
have reviewed our conclusion that our business consists of a single operating
and reportable segment with our independent registered public accounting firm,
Grant Thornton LLP, and they have concurred with our conclusion.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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          </div>
          <div style="WIDTH: 100%" align="center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">Response
of November 4, 2009 of Sterling Construction Company, Inc. to Comments of the
Securities and Exchange Commission of October 6, 2009</font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-STYLE: italic; TEXT-DECORATION: underline">Goodwill
and Intang</font><font style="DISPLAY: inline; TEXT-DECORATION: underline">ibles, Page
F10</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="MARGIN-LEFT: 36pt; TEXT-INDENT: 36pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 9pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We note
your response to comment 14 in our letter dated July 29. 2009. While we note
that you concluded that you have one operating and reportable segment in
accordance with the guidance in SFAS 131, the determination of your reporting
units for purposes of testing goodwill for impairment is based on the guidance
in paragraph 30 of SFAS 142. ETIF Topic D-101 provides further guidance on
paragraph 30 of SFAS 131, ETIF Topic D-101 states, &#8220;... it is the chief
operating decision maker who reviews operating segments and the segment manager
who reviews reporting units (components of operating segments). Therefore a
component of an operating segment would not be considered an operating segment
for Statement 131 purposes unless the chief operating decision maker regularly
reviews its operating performance; however, that same component might be a
reporting unit under Statement 142 if a segment manager regularly reviews its
operating performance (and if other reporting unit criteria are
met)."&#160;&#160;In this regard, we note your statement in response to comment
12 that your offices (i.e., Reno, Houston, San Antonio/Austin. and Dallas/Fort
Worth) are managed at the local level in addition to the parent company
level.&#160;&#160;As such, please provide us with your analysis of the guidance
in SFAS 142 and EITF Topic D-101 regarding your determination that you have one
reporting unit for purposes of testing goodwill for impairment to the extent
that you continue to believe you have one operating segment in accordance with
SFAS 131.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Response</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">As
discussed further in the preceding response, we manage all of our operations
based on a consistent and single method, focusing on individual construction
projects and those projects&#8217; results and resource needs. Because our field
offices are managed locally to some degree, and because discreet financial
information is available at that level,&#160;&#160;an argument could be made
that the individual field office locations represent components of our heavy
civil construction operating segment, although we do not believe that they do
for the following reasons. While discrete financial information is available to
field office management, they like our CODM, are focused on individual projects
in their field office areas and allocating resources to those projects. However,
even if our field offices were determined to represent separate components of
our heavy civil construction operating segment, those components could
be&#160;&#160;aggregated into&#160;&#160;a single reporting unit under Paragraph
30 of SFAS 142 as they have similar economic characteristics and&#160;&#160;the
construction projects they perform are similar in the following
areas:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
      nature of the heavy civil construction services rendered in each of our
      construction&#160;&#160;projects is the same&#8212;they build, reconstruct and
      repair roads, highways, bridges and water, waste water and storm drainage
      systems.</font></div>
              </td>
            </tr></table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
      nature of the construction production process by each of our projects is
      the same&#8212;they excavate dirt, remove existing pavement and pipe, lay
      aggregate or concrete pavement and pipe and build bridges and similar
      large structures in order to complete our
  projects.</font></div>
              </td>
            </tr></table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Our
      services are rendered only to governmental agencies&#8212;our customers are
      federal and state departments of transportation, cities, counties, and
      regional water and toll-road authorities. A substantial portion of the
      funding for the departments of transportation to finance the projects we
      construct is furnished by the federal
  government.</font></div>
              </td>
            </tr></table>
      </div>
      <div>
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<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
      heavy civil construction services rendered on our projects are performed
      primarily with our own field work crews (laborers, equipment operators and
      supervisors) and equipment (backhoes, loaders, dozers, graders, cranes,
      pug mills, crushers, and concrete and asphalt
  plants).</font></div>
              </td>
            </tr></table>
      </div>
      <div>
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<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">The
      nature of the regulatory environment in which we perform our construction
      services is the same&#8212;all of our projects are subject to the U.S. and state
      department of transportation rules; including prevailing wage laws; codes
      established by the federal government and municipalities regarding water
      and waste water systems installation; and laws and regulations relating to
      workplace safety and worker health of the U.S. Occupational Safety and
      Health Administration&#160;&#160;and to the employment of immigrants of
      the U.S. Department of Homeland
Security.</font></div>
              </td>
            </tr></table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" id="list" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr valign="top">
              <td align="right" style="WIDTH: 54pt">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic;" face="Symbol, serif">&#183;&#160;&#160;</font></div>
              </td>
              <td>
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Profit
      margin objectives included in contract bids have some variability from
      contract to contract, but are not differentiated by our CODM or our field
      office management based on office location. Instead, the projects
      undertaken by each field office are competively-bid, fixed-unit price
      contracts, all of which are bid based on achieving gross profit levels
      based on the relevant skill required, the contract size and duration, the
      availability of our personnel and equipment, the makeup and level of our
      existing backlog, our competitive advantages and disadvantages, prior
      experience, the contracting agency or customer, the source of contract
      funding, anticipated start and completion dates, construction risks,
      penalties or incentives and general economic
  conditions.</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
continue to believe that we have one operating and reportable segment and only
one reporting unit and that is heavy civil construction of highways, bridges,
light-rail and water, wastewater and storm drainage systems for domestic state
and municipal-type agencies.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
find the guidance in ETIF D-101 to be consistent with our conclusions
above.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
have reviewed our conclusion that our business consists of a single reporting
unit with our independent registered public accounting firm, Grant Thornton LLP,
and they have concurred with our conclusion.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
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          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt">4</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
          <div style="WIDTH: 100%" align="center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">Response
of November 4, 2009 of Sterling Construction Company, Inc. to Comments of the
Securities and Exchange Commission of October 6, 2009</font></div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">7.</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Costs and Estimated Earnings
and Billings on Uncompleted Contracts, page F 17</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;We
note the disclosure you intend to include in future filings in response to
comment in our letter dated July 29, 2009. While this disclosure docs provide
investors with useful information regarding your recognition of billings in
excess of costs and costs in excess of billings, it is unclear how this
disclosure explains to investors what the purpose of the two tables presented
is. For example, if the first table represents all of the revenues recognized on
all uncompleted contracts as of the two periods presented and all of the amounts
billed on all uncompleted contracts as of the two periods presented, please
state as such. Further, please also clarify that the revenues recognized and the
amounts billed may relate to periods other than the respective fiscal year
(e.g., $584,997,000 of revenues recognized for those contracts that are
uncompleted as of December 3 1, 2008, were not all recognized during fiscal year
2008.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Response</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">In
future filings with the Commission, we will include disclosure that explains to
investors the purpose of the two tables presented and also clarify that revenues
recognized and amounts billed may relate to periods other than the respective
fiscal year.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Form 10-Q for the period
ended June 30. 2009</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">3. Recent Accounting
Pronouncements, page 9</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;In
future filings, please disclose the date through which subsequent event have
been evaluated. Refer to paragraph 12 of SFAS 165<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>for
guidance.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Response</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 18pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">We
made the following disclosure in Note 1 to the financial statements included in
our Form 10-Q for the period ended June 30, 2009: &#8220;We have evaluated subsequent
events for potential recognition and disclosure through August 10, 2009, the
date the consolidated financial statements included in the Quarterly Report on
Form 10-Q were issued.&#8221; We will comply with this disclosure requirement in
future filings with the Commission.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">5</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">_________________</font><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">__________________</font></div><br></div>
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