ASSET PURCHASE AGREEMENT





         THIS ASSET PURCHASE AGREEMENT (the "AGREEMENT") is entered into as of

September 23, 2002 by and among Texas Sterling Construction, LP, a Texas limited

partnership ("BUYER"), and Kinsel Industries, Inc., a Texas corporation

("KINSEL"), Tracks of Texas, Inc., a Texas corporation ("TRACKS OF TEXAS", and

collectively with Kinsel referred to herein as "SELLERS"). Buyer and Sellers are

collectively referred to herein as the "PARTIES."



         WHEREAS, Kinsel is engaged in the business of providing heavy highway

construction and related services in and near the vicinity of Harris County,

Texas ("SELLERS' BUSINESS" or "BUSINESS"), and Tracks of Texas leases certain

tangible personal property owned by Tracks of Texas to Kinsel that is used

exclusively or partially in the Business;



         WHEREAS, Buyer desires to purchase certain specified assets of Sellers,

and to assume certain specified employee cost liabilities of Sellers' Business,

and Sellers desire to sell such assets to Buyer and for Buyer to assume such

specified employee cost liabilities;



         WHEREAS, Sellers and Buyer desire to provide for the assignment to and

assumption by Buyer of certain Kinsel contracts and Sellers leases pertinent to

the Business and to provide transitional arrangements with respect thereto

pending completion of such assignments and assumptions, all as provided in this

Agreement and the Subcontract Agreement and Master Sublease Agreement

contemplated hereby;



         WHEREAS, Sellers and Buyer desire to provide arrangement for completion

and closing out of certain Kinsel contracts not being assigned to or assumed by

Buyer, all as provided in this Agreement and the Subcontract Agreement; and



         WHEREAS, Sellers are each wholly-owned subsidiaries of Insituform

Technologies, Inc., a Delaware corporation ("SELLERS' PARENT"), and Buyer is

wholly-owned by Sterling General, Inc., a Delaware corporation and Buyer's sole

general partner, and Sterling Houston Holdings, Inc., a Delaware corporation and

Buyer's sole limited partner (together, "BUYER'S PARENTS");



         NOW, THEREFORE, in consideration of the premises and mutual promises

and covenants herein contained, the Parties hereby stipulate and agree as

follows:



                                    SECTION 1



                                   DEFINITIONS



         Certain capitalized terms used in this Agreement have the meanings

specified in the GLOSSARY attached hereto. Other terms may be defined elsewhere

in the body of this Agreement and shall have the meaning indicated throughout

this Agreement. The terms defined in the singular shall have a comparable

meaning when used in the plural, and vice versa.







{PAGE}



                                    SECTION 2



         PURCHASE AND SALE OF ACQUIRED ASSETS; ASSUMPTION OF TRANSFERRED

      EMPLOYEE COSTS; ARRANGEMENTS REGARDING BUSINESS CONTRACTS AND LEASES



         2.1. Acquired Assets. At the Effective Time, in accordance with this

Agreement, Sellers shall sell, convey, transfer, assign and deliver to Buyer,

and Buyer shall purchase from Sellers, all of Sellers' right, title and interest

in and to all of the equipment used in Sellers' Business as of the Closing Date

that is listed on Schedule 2.1 as "Acquired Equipment" (such schedule, the

"EQUIPMENT SCHEDULE," and such equipment, the "ACQUIRED EQUIPMENT," and

sometimes referred to herein as the "ACQUIRED ASSETS"), free and clear of all

Liens. (The equipment listed on Schedule 2.1 as Port Contract Equipment is

referred to as the "PORT CONTRACT EQUIPMENT" but is not being conveyed at

Closing.)



         2.2. Transferred Employee Costs. At the Effective Time, in accordance

with this Agreement, Buyer shall assume from Sellers and shall be bound by,

shall be liable for and shall pay, perform or otherwise discharge as the same

shall become due in accordance with their respective terms, those certain

liabilities and obligations of Sellers set forth on Schedule 2.2 hereto, but in

each case and only as, and not in excess of the respective amounts set forth on

Schedule 2.2 and only as to those of the employees of the Business who are

offered and qualify for employment by Buyer and are employed by Buyer after the

Closing pursuant to Section 8.1 hereof ("TRANSFERRED EMPLOYEES") (such assumed

liabilities and obligations as to such Transferred Employees, "TRANSFERRED

EMPLOYEE COSTS").



         2.3. Purchase Price; Adjustments. In consideration of the sale,

assignment, and delivery of the Acquired Assets, Buyer shall assume the

Transferred Employee Costs and shall pay the Sellers a total consideration of

$4,361,100, subject to adjustment as provided in the following sentence, in the

form of cash and two subordinated notes as provided in Section 2.4 (the

"PURCHASE PRICE"). The Purchase Price shall be reduced by the amount of the

Transferred Employee Costs, and shall be subject to further reduction by an

amount equal to the value of the U.S. 59 Contract Equipment, if any, transferred

by Buyer to Sellers pursuant to Section 2.7.



         2.4. Payment of Purchase Price. The Purchase Price shall be payable by

the Buyer to the Sellers on the Closing Date as follows:



         (a)      Buyer will pay Sellers an amount equal to the Purchase Price

                  less $1,500,000 in cash by cashier's check or by wire transfer

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