Document:

Exhibit 10.2

September 28, 2000

Mr. Thomas Trotter
President and Chief Executive Officer
OrthoLogic Corp.
1275 W. Washington Street
Tempe, Arizona 85281

RE:  TERMINATION OF CO-PROMOTION AGREEMENT/HYALGAN(R)

Sanofi-Synthelabo Inc. ("SaSy") and OrthoLogic Corp.  ("OrthoLogic") are parties
to the Co-Promotion Agreement, dated June 23, 1997, as amended,  supplemented or
modified  from time to time,  the  "Co-Promotion  Agreement";  terms not defined
herein  as used  herein  as  defined  in the  Co-Promotion  Agreement.  SaSy and
OrthoLogic have agreed to an early termination of the Co-Promotion  Agreement on
the terms and conditions set out in this termination  letter (this  "Termination
Letter").

As consideration for the early termination of the Co-Promotion  Agreement,  SaSy
shall pay  OrthoLogic  an amount not greater than ****** as specified in section
II below;  provided that all terms and conditions of this Termination Letter are
met.

I. DEFINITIONS:

*    "HSP Orthopedic Units" means the cumulative  weekly reports  distributed by
     Health Services Plus detailing sales activity of the Product.
*    "Signing   Date"  means  the  date  of  execution  by  OrthoLogic  of  this
     Termination Letter.
*    "Termination  Date" is the Signing Date and shall mean the  termination  of
     the  Co-Promotion  Agreement,  except which  provisions of the Co-Promotion
     Agreement shall survive said termination,  as specified in this Termination
     Letter.
*    "Transition  Obligations" shall have the meaning set forth in Paragraph III
     below.
*    "Transition Period" means the Signing Date through December 31, 2000.
*    "Unit" means all DDD units reported by IMS.

II.  CONSIDERATION:

*    $3.0 million dollars upon Signing Date.

*    ******  dollars upon  completion of Transition  Obligations,  to be paid as
     follows:

     a.   ****** upon the successful completion of 100% of the obligations under
          the "Account  Transition"  paragraph  herein;  If less than 90% of the
          obligations  specified in "Account  Transition"  paragraph is met than
          OrthoLogic  shall not receive any portion of the ******.  However,  if

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       1
<PAGE>
          OrthoLogic achieves between 90% and 100% of the obligations  specified
          in the "Account  Transition"  paragraph,  the ******  payment shall be
          paid on a prorated basis.

     b.   ****** upon the  successful  completion of the  obligations  under the
          "Continued Product Performance" paragraph herein; and

     c.   ******  upon  the  successful  completion  of  the  entire  Transition
          Obligations.

*    ******:

     *    ******  ******  *******

     Funds  shall be  delivered  to  OrthoLogic  by wire  transfer  (net of bank
     charges) to the bank designated by OrthoLogic for such purpose.

III. TRANSITION:

SaSy and  OrthoLogic  shall use their best  efforts to  cooperate  and  actively
participate  in  the  transition  of  responsibilities   and  rights  under  the
Co-promotion  Agreement to SaSy during the  Transition  Period.  The  Transition
Period is to provide the seamless transfer of roles, rights and responsibilities
under the Co-Promotion Agreement from OrthoLogic to SaSy while maintaining, at a
minimum,  the current level of Product sales  performance in the Territory.  The
following terms and conditions shall be known as the "Transition Obligations":

*    CONTINUE  SALES EFFORT:  During the  Transition  Period,  OrthoLogic  shall
     continue in a timely manner all sales activities for the Product consistent
     with the Co-promotion Agreement's terms and conditions.

          CONTINUED PRODUCT PERFORMANCE: During the Transition Period OrthoLogic
          shall be paid ******

*    ******

*    ******

*    ******

COMMERCIAL  TRANSITION  BRIEFINGS:  During the  Transition  Period,  a committee
comprised of each party's senior sales and marketing  representatives shall meet
no less  than on two (2)  occasions,  at  mutually  agreeable  dates,  times and
locations,  to provide commercial briefings on the progress towards a successful
transition.  This committee will prepare a final report verifying the completion
of the Transition Obligations. The members of said committee are as follows: (i)
on behalf of OrthoLogic,  it shall be Tom Trotter,  Bill Rieger and David Floyd;
and (ii) on behalf of SaSy,  it shall be Jeff  Brennan,  Brent  Ragans  and Ross
Girglani.

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       2
<PAGE>
*    ******
     *    ******
     *    ******
     *    ******
     *    ******
     *    ******
     *    ******
     *    ******
     *    ******
     *    ******

*    EXCESSIVE STOCKING OF ACCOUNTS: OrthoLogic shall not instruct its employees
     or agents, or use incentives to induce its accounts to order inventories in
     excess of said account's normal purchasing history.

*    ******

     a.   ******
     b.   ******
     c.   ******
     d.   ******
     e.   ******
     f.   ******
     g.   ******
     h.   ******
     i.   ******
     j.   ******
     k.   ******
     l.   ******
     m.   ******
     n.   ******

IV. CO-PROMOTION AGREEMENT HSP LETTER AGREEMENT:

*    The terms of conditions of the HSP letter, dated, August 22, 2000, attached
     hereto as  Attachment  A and made  part of this  Termination  Letter  shall
     remain in full force and effect  between the  Parties  until such time that
     all terms and conditions of such HSP letter are fully met by the Parties.

V. ORDERS

OrthoLogic  shall  during  the  Transition  Period and for a period of three (3)
months thereafter,  forward any Product orders,  within two (2) business days of
OrthoLogic's  receipt of said order,  to Health  Services  Plus by facsimile and
shall also  notify the  appropriate  SaSy sales  representative  of said  order.
Thereafter,  for any Product order that  OrthoLogic  shall  receive,  OrthoLogic

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       3
<PAGE>
shall notify that account that SaSy is now  responsible  for all Hyalgan orders,
further the OrthoLogic  representative  shall immediately notify the appropriate
SaSy sales representative.

VI. RETURNS

OrthoLogic  shall continue its sales of the Product in the normal course through
the Transition  Period.  OrthoLogic  shall not take any action other than in the
normal course of business to induce  accounts to increase  their  inventories of
the Product.  For a period of six (6) months  following the Termination  Period,
SaSy shall  invoice  OrthoLogic  for the  amount of any credit  given by SaSy to
customers for such returned  Product that is in excess of the average returns of
the Product for the three (3) months prior to the Termination Date.  Thereafter,
all returns shall be at SaSy's expense.

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       4
<PAGE>
VII. TERMINATION OF THE CO-PROMOTION AGREEMENT:

SaSy and  OrthoLogic  agree that until the  Termination  Date, the parties shall
continue  to hold the rights and  remain  responsible  for the rights and remain
responsible for the obligations  relating to the Product under the  Co-Promotion
Agreement  except as may be otherwise  stated in this  Termination  Letter.  The
Co-Promotion  Agreement shall be terminated  effective the Termination  Date and
shall have no force and effect unless otherwise stated herein.

In the event that any provision of this  Termination  Letter shall conflict with
any provision of the Co-Promotion Agreement,  the provisions of this Termination
Letter shall govern.

SaSy and  OrthoLogic  agree  that the  following  Sections  of the  Co-promotion
Agreement shall survive the termination of the Co-Promotion Agreement:

     a.   Subsection 3.3 relating to "Non-Compete";
     b.   Subsection 4.2 relating to "Limitation of Liability";
     c.   Section 7.2 relating to "Examination of Records";
     d.   Section 8.3 relating to "Trademark Rights upon Termination";
     e.   Subsection 9.5 relating to "Record-Keeping";
     f.   Article X relating to "Indemnification";
     g.   Article XII relating to "Confidential Information";
     h.   Article XIII relating to "Relationship of the Parties";
     i.   Article XV relating to the "Property of the Parties"; and
     j.   Article XVI relating to "Injunctive Relief".

VIII. COMMUNICATIONS

Neither   party  hereto  shall  issue  any  initial   press  release  or  public
announcement or otherwise  initially  divulge the existence of this  Termination
Letter or its terms  without the prior written  consent of the other party.  Any
subsequent  press  release  or  public  announcements  shall  not  disclose  the
financial terms of this Termination Letter,  shall not be contrary to the spirit
of this  Agreement  and shall not cause  damages to the  Product or the  parties
hereto.  In the event a party shall be obligated by law, rules or regulations of
any  governmental  or  regulatory  body,  the other  party shall have a right to
review and must respond to the other party within 48 hours,  to such  statement,
disclosure,  etc. prior to submission to the relevant governmental or regulatory
body.

IX. MISCELLANEOUS

Any information  which is required to be provided  pursuant to these  Transition
Obligations or the  Termination  Agreement  shall be subject to Article XII, the
confidentiality provisions, set forth in the CO-PROMOTION Agreement.

If a party hereto materially  breaches its obligations to perform the Transition
Obligations  and the  defaulting  party fails to cure such breach within 30 days
following the date written notice thereof is delivered by the other party to the
defaulting  party,  the  non-defaulting  party  shall have  available  to it all
remedies available to it at law.

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       5
<PAGE>
This Termination  Letter and the documents  referenced in the Termination Letter
constitute  the entire  agreement  between SaSy and  OrthoLogic  concerning  the
subject  matter  hereof,  and supersede all written or oral prior  agreements or
understandings  with  respect  thereto.  No party  shall  claim  any  amendment,
modification  or  release  from  any  provision  hereof  by  mutual   agreement,
acknowledgement  or otherwise,  except by written  agreement  signed by SaSy and
OrthoLogic.

SaSy and OrthoLogic  shall execute and deliver such further  instruments  and do
such further acts as may be required to implement the intent of this Termination
Letter.

This  Termination  Letter shall be deemed to have been  executed in and shall be
governed by and  interpreted in accordance with the laws prevailing in the State
of New York, regardless of its choice of law principles.

If the above is  satisfactory  to  OrthoLogic,  please sign the enclosed copy of
this Termination Letter and return to the attention of Jeffrey P. Brennan,  Vice
President, Business Development.

                                        Very truly yours,

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------

ACKNOWLEDGED, AGREED TO AND ACCEPTED:

ORTHOLOGIC CORP.

By:
   ----------------------------------
Name:
     --------------------------------
Title:
      -------------------------------

******Text has been omitted pursuant to a confidentiality  request. Omitted text
has been filed with the Securities & Exchange Commission.

                                       6
<PAGE>Exhibit 10.1

                          SIXTH MODIFICATION AGREEMENT

     This SIXTH  MODIFICATION  AGREEMENT (this  "AGREEMENT") is made and entered
into as of July 31, 2000, by and between  LEGACY/MONTEREY HOMES L.P., an Arizona
limited partnership  ("BORROWER"),  and GUARANTY FEDERAL BANK, F.S.B., a federal
savings  bank  organized  and  existing  under  the  laws of the  United  States
("LENDER").

                                   WITNESSETH:

     WHEREAS, pursuant to a certain Master Loan Agreement (the "LOAN AGREEMENT")
dated as of January 31, 1993,  between  Lender and Borrower,  Lender made a loan
(the "LOAN") to Borrower,  evidenced by a certain Revolving Promissory Note (the
"NOTE") dated as of January 31, 1993,  payable to Lender in the stated principal
amount of SIXTY-FIVE MILLION AND NO/100 DOLLARS ($65,000,000.00),  with interest
and principal payable as set forth therein; and

     WHEREAS,  to secure the Note and Loan,  Master Form  Deed(s) of Trust (With
Security Agreement and Assignment of Rents and Leases) (hereinafter collectively
referred to as the "MASTER DEEDS OF TRUST,"  whether one or more),  which Master
Deeds of Trust have been  recorded in certain  counties in the State of Texas as
more particularly described on Exhibit A attached hereto; and which Master Deeds
of Trust are  incorporated by reference  pursuant to the terms and provisions of
certain  Deeds of Trust  Incorporating  by Reference a Master Form Deed of Trust
(With  Security  Agreement  and  Assignment  of  Rents  and  Leases)  (hereafter
collectively  referred to as the  "SUPPLEMENTAL  DEEDS OF TRUST," whether one or
more) recorded in such counties and encumbering  certain real and other property
(the  "PROPERTY")  described  in such  Supplemental  Deeds of Trust (such Master
Deeds of Trust and Supplemental Deeds of Trust hereafter  collectively  referred
to as the "DEEDS OF TRUST," whether one or more); and

     WHEREAS,  the  Deeds of Trust  were  modified  pursuant  to a  Modification
Agreement (the "FIRST MODIFICATION"), and recorded in various counties in Texas,
which First  Modification  modified  certain terms and provisions of the Loan as
set forth therein; and

     WHEREAS,  the Deeds of Trust were further pursuant to a Second Modification
Agreement (the "SECOND  MODIFICATION") dated as of May 19, 1998, and recorded in
various counties in Texas, which Second Modification  modified certain terms and
provisions of the Loan as set forth therein; and

SIXTH MODIFICATION AGREEMENT - Page 1
<PAGE>
     WHEREAS,  the Deeds of Trust were further pursuant to a Third  Modification
Agreement (the "THIRD MODIFICATION") dated as of March 30, 1999, and recorded in
various counties in Texas, which Third  Modification  modified certain terms and
provisions of the Loan as set forth therein; and

     WHEREAS,  the Deeds of Trust were further pursuant to a Fourth Modification
Agreement (the "FOURTH MODIFICATION") dated as of July 31, 1999, and recorded in
various counties in Texas, which Fourth Modification  modified certain terms and
provisions of the Loan as set forth therein; and

     WHEREAS,  the Deeds of Trust were further pursuant to a Fifth  Modification
Agreement  (the "FIFTH  MODIFICATION")  dated March 24,  2000,  and  recorded in
various counties in Texas, which Fifth  Modification  modified certain terms and
provisions of the Loan as set forth therein; and

     WHEREAS,  the Note and the Loan are  guaranteed  pursuant  to that  certain
Guaranty  Agreement  dated as of June 30,  1997 (the  "GUARANTY"),  executed  by
MTH-Texas  GP, Inc.,  an Arizona  corporation,  MTH-Texas  LP, Inc.,  an Arizona
corporation,  and Meritage  Corporation,  a Maryland  corporation  ("GUARANTOR,"
whether one or more); and

     WHEREAS, the Loan Agreement,  the Note, the First Modification,  the Second
Modification,  the  Third  Modification,  the  Fourth  Modification,  the  Fifth
Modification,  the  Deeds of Trust and all other  documents  evidencing  and/ or
securing the Loan are hereinafter  collectively  called the "LOAN  INSTRUMENTS";
and

     WHEREAS,  Lender,  the owner and  holder of the Note and the Deeds of Trust
and all rights and titles evidenced thereby,  and Borrower,  the record owner of
the Property  and being  liable for the payment of the Note and Loan,  desire to
modify the Loan Instruments as herein provided.

     NOW,  THEREFORE,  in consideration of Ten and No/ 100 Dollars ($ 10.00) and
other good and valuable consideration,  the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

     1. The stated maturity date of the Note is hereby extended to and including
July 31, 2001, when the entire unpaid  principal  balance of the Note,  together
with  all  accrued  and  unpaid  interest  shall be due and  payable;  provided,
however, such date may be extended as set forth in the Loan Agreement.

     2. Borrower shall execute and deliver to Lender a letter agreement (in form
and  substance  satisfactory  to Lender  in its sole  discretion)  (the  "LETTER
AGREEMENT")  dated  as of the date  hereof  amending  certain  other  terms  and
provisions of the Loan  Instruments.  (Hereafter,  this Agreement and the Letter
Agreement shall be included in the defined term "LOAN INSTRUMENTS.")

SIXTH MODIFICATION AGREEMENT - Page 2
<PAGE>
     3. Borrower  acknowledges and agrees, that as an accommodation to Borrower,
Exhibit A hereto  (which  exhibit  describes the  recording  information  of the
Master Deeds of Trust) shall be attached to this  Agreement  (and to any and all
other  documents  which may  require  the  attachment  of a  description  of the
recording  information of the Master Deeds of Trust) after Borrower's  execution
of same.  Accordingly,  Borrower hereby  authorizes and directs Lender to attach
such Exhibit A to this Agreement.

     4. Notwithstanding anything to the contrary in any of the Loan Instruments,
Borrower  acknowledges and agrees,  that to the extent that Lender is relying on
Chapter 303 of the Texas  Finance  Code to  determine  the  Maximum  Lawful Rate
(hereafter  defined)  payable  on the  Note  and/  or the  Related  Indebtedness
(hereafter  defined) Lender will utilize the weekly ceiling from time to time in
effect as provided in such Chapter 303, as amended.  To the extent United States
federal law permits Lender to contract for, charge,  take,  receive or reserve a
greater  amount of  interest  than under  Texas law,  Lender will rely on United
States  federal law instead of such  Chapter 303 for the purpose of  determining
the Maximum Lawful Rate.  Additionally to the extent permitted by applicable law
now or  hereafter  in effect,  Lender  may, at its option and from time to time,
utilize any other  method of  establishing  the  Maximum  Lawful Rate under such
Chapter 303 or under other  applicable  law by giving  notice,  if required,  to
Borrower as provided  by  applicable  law now or  hereafter  in effect.  As used
herein,  the term  "MAXIMUM  LAWFUL RATE" shall mean the maximum  lawful rate of
interest which may be contracted for,  charged,  taken,  received or reserved by
Lender  in  accordance  with the  applicable  laws of the  State  of  Texas  (or
applicable  United  States  federal law to the extent that it permits  Lender to
contract for, charge, take, receive or reserve a greater amount of interest than
under Texas law), taking into account all Charges (as hereafter defined) made in
connection  with  the  transaction  evidenced  by the Note  and the  other  Loan
Instruments.  As used herein,  the term "CHARGES"  shall mean all fees,  charges
and/ or any other things of value, if any,  contracted for,  charged,  received,
taken or reserved by Lender in connection with the transactions  relating to the
Note and the  other  Loan  Instruments,  which are  treated  as  interest  under
applicable law. As used herein, the term "RELATED  INDEBTEDNESS"  shall mean any
and all  debt  paid or  payable  by  Borrower  to  Lender  pursuant  to the Loan
Instruments  or any other  communication  or writing by or between  Borrower and
Lender related to the transaction or transactions  that are the subject mater of
the Loan  Instruments,  except  such debt  which has been paid or is  payable by
Borrower to Lender.

     5. Notwithstanding anything to the contrary contained in the Deeds of Trust
or other Loan Instruments,  with respect to any amendment to the Master Deeds of
Trust, the following terms and provisions shall apply:

     With respect to any amendment or  modification of the Master Deeds of Trust
     now or hereafter  executed by Borrower (or any future owner of the Property
     if different from Borrower) and duly recorded in the  appropriate  official
     public  records,  Borrower  acknowledges  and agrees that such amendment or
     modification of the Master Deeds of Trust shall  constitute an amendment or
     modification to the terms and provisions of any such Supplemental  Deeds of
     Trust (and shall be incorporated into any such Supplemental  Deeds of Trust
     and made a part  thereof  for all  purposes,  as though such  amendment  or

SIXTH MODIFICATION AGREEMENT - Page 3
<PAGE>
     modification  of the Master  Deeds of Trust  specifically  referred to such
     Supplemental  Deeds  of  Trust)  without  the  necessity  of  any  specific
     reference in such amendment or modification to any such Supplemental  Deeds
     of Trust;  and no such  amendment  or  modification  of the Master Deeds of
     Trust shall impair the obligations of Borrower under any such  Supplemental
     Deeds of Trust or any other of the Loan Instruments.

     6. Borrower hereby  expressly  promises to pay to the order of Lender,  the
principal  amount of the Note (as  modified  and  extended)  and all accrued and
unpaid  interest now or hereafter to become due and payable under the Note,  and
Borrower hereby expressly promises to perform all of the obligations of Borrower
under the Loan Instruments (as modified and extended).

     7. The liens of the Deeds of Trust are hereby  acknowledged  by Borrower to
be good,  valid and  subsisting  liens,  and such liens are hereby  renewed  and
extended  so as to secure  the  payment  of the Note and Loan (as  modified  and
extended).

     8. Borrower  hereby  represents and warrants to Lender that (a) Borrower is
the sole legal and beneficial  owner of the Property;  (b) Borrower has the full
power and authority to make the agreements  contained in this Agreement  without
joinder  or  consent  of any  other  party;  (c)  the  execution,  delivery  and
performance  of this  Agreement will not contravene or constitute an event which
itself or which  with the  passing  of time or  giving  of notice or both  would
constitute a default under any deed of trust, loan agreement, indenture or other
agreement to which  Borrower or Guarantor is a party or by which Borrower or any
of its  property  is bound;  and (d)  there  exists  no  default  under the Loan
Instruments  (as modified).  BORROWER HEREBY AGREES TO INDEMNIFY AND HOLD LENDER
HARMLESS  AGAINST  ANY LOSS,  CLAIM,  DAMAGE,  LIABILITY  OR EXPENSE  (INCLUDING
WITHOUT LIMITATION,  ATTORNEYS' FEES) INCURRED AS A RESULT OF ANY REPRESENTATION
OR  WARRANTY  MADE BY  BORROWER  HEREIN  PROVING  TO BE UNTRUE  IN ANY  MATERIAL
RESPECT.

     9. The terms and conditions hereof may not be modified, amended, altered or
otherwise  affected  except by  instrument  in  writing  executed  by Lender and
Borrower.

     10.  All Loan  Instruments  are hereby  amended  and  modified  in a manner
consistent with the  modifications,  terms and/ or provisions  contained herein.
Except as  expressly  modified  hereby,  the terms  and  conditions  of the Loan
Instruments are and shall remain in full force and effect.

     11. Borrower agrees to pay to Lender,  contemporaneously with the execution
and delivery  hereof,  all costs and expenses  incurred in connection  with this
transaction,  title insurance endorsement premiums,  reasonable fees of Lender's
counsel and recording fees.

     12.  Borrower  hereby  agrees to execute and deliver to Lender such further
documents and instruments  evidencing or pertaining to the Loan, as modified and
increased hereby, as may be reasonably  requested by Lender from time to time so
as to evidence the terms and conditions hereof.

             [The balance of this page is intentionally left blank.]

SIXTH MODIFICATION AGREEMENT - Page 4
<PAGE>
     EXECUTED  on the  date(s)  set forth in the  acknowledgment(s)  below to be
EFFECTIVE as of the date first above written.

                                         BORROWER:

                                         LEGACY/ MONTEREY HOMES L.P.,
                                         an Arizona limited partnership

                                         BY: MTH-TEXAS GP, INC.,
                                             an Arizona corporation,
                                             General Partner

                                             By: /s/ Rick Morgan
                                                 -------------------------------
                                                 Name: Rick Morgan
                                                 Title: Vice President

                                         LENDER:

                                         GUARANTY FEDERAL BANK, F.S.B.,
                                         a federal savings bank

                                         By: /s/ Sam A. Meade
                                             -----------------------------------
                                             Name: Sam A. Meade
                                             Title: Senior Vice President

STATE OF TEXAS        ss.
                      ss.
COUNTY OF COLLIN      ss.

     This  instrument  was  ACKNOWLEDGED  before me on August 8,  2000,  by Rick
Morgan, Vice President of MTH-TEXAS GP, INC., an Arizona corporation, as General
Partner of LEGACY/  MONTEREY  HOMES L.P.,  an Arizona  limited  partnership,  on
behalf of said limited partnership.

[SEAL]                                  /s/ Ana Patterson
                                        ----------------------------------------
                                        Notary Public

My Commission Expires:                  Ana Patterson
                                        ----------------------------------------
     08-28-2003                         Printed Name of Notary Public
---------------------

SIXTH MODIFICATION AGREEMENT - Page 5
<PAGE>
                              CONSENT OF GUARANTOR

     Each of the undersigned,  as a guarantor ("GUARANTOR," whether one or more)
of the loan (the  "LOAN"),  evidenced  by the Note and  secured  by the Deeds of
Trust described in the foregoing Fifth Modification  Agreement (the "AGREEMENT")
to which this Consent is attached,  hereby  acknowledge and consent (jointly and
severally) to the terms of the Agreement and agree (jointly and severally)  that
the  execution  and  delivery of the  Agreement  will in no way change or modify
Guarantor's  respective  obligations under their respective Guaranty (as defined
in the  Agreement);  and each  Guarantor  acknowledges  and agrees  (jointly and
severally)  that the  Indebtedness  (as  defined in the  respective  instruments
comprising  the  Guaranty)  includes the Loan,  together  with any and all other
Indebtedness now or at any time hereafter owing by Guarantor to Lender; and each
Guarantor  (jointly  and  severally)  hereby   unconditionally   and  absolutely
guarantees  to Lender  the  payment  when due of such  Indebtedness,  and hereby
acknowledge  and agree  that  their  respective  Guaranty  is in full  force and
effect,  and that there are no claims,  counterclaims,  offsets or  defenses  to
their respective Guaranty; and each Guarantor acknowledges and consents (jointly
and severally) to the terms of any and all prior  modifications  to the terms of
the Loan  (including,  without  limitation,  any and all  extensions of the term
thereof and  increases in the  principal  thereof  prior to the date hereof,  if
any).

     EXECUTED  on the  date(s)  set forth in the  acknowledgment(s)  below to be
EFFECTIVE as of the 31st day of July, 2000.

                                         GUARANTOR:

                                         MERITAGE CORPORATION,
                                         a Maryland corporation

                                         By: /s/ John R. Landon
                                             -----------------------------------
                                             Name: John R. Landon
                                             Title: Co-CEO

                                         MTH-TEXAS GP, INC.,
                                         an Arizona corporation

                                         By: /s/ Rick Morgan
                                             -----------------------------------
                                             Name: Rick Morgan
                                             Title: Vice President

                                         MTH-TEXAS LP, INC.,
                                         an Arizona corporation

                                         By: /s/ Rick Morgan
                                             -----------------------------------
                                             Name: Rick Morgan
                                             Title: Vice President

SIXTH MODIFICATION AGREEMENT - Page 6
<PAGE>
STATE OF TEXAS        ss.
                      ss.
COUNTY OF COLLIN      ss.

     This  instrument was  ACKNOWLEDGED  before me on August 8, 2000, by John R.
Landon,  Co-CEO of MERITAGE CORPORATION,  a Maryland  corporation,  on behalf of
said corporation.

[SEAL]                                  /s/ Ana Patterson
                                        ----------------------------------------
                                        Notary Public

My Commission Expires:                  Ana Patterson
                                        ----------------------------------------
     08-28-2003                         Printed Name of Notary Public
---------------------

STATE OF TEXAS        ss.
                      ss.
COUNTY OF COLLIN      ss.

     This  instrument  was  ACKNOWLEDGED  before me on August 8,  2000,  by Rick
Morgan, Vice President of MTH-TEXAS GP, INC., an Arizona corporation,  on behalf
of said corporation.

[SEAL]                                  /s/ Ana Patterson
                                        ----------------------------------------
                                        Notary Public

My Commission Expires:                  Ana Patterson
                                        ----------------------------------------
     08-28-2003                         Printed Name of Notary Public
---------------------

SIXTH MODIFICATION AGREEMENT - Page 7
<PAGE>
STATE OF TEXAS        ss.
                      ss.
COUNTY OF COLLIN      ss.

     This  instrument  was  ACKNOWLEDGED  before me on August 8,  2000,  by Rick
Morgan, Vice President of MTH-TEXAS LP, INC., an Arizona corporation,  on behalf
of said corporation.

[SEAL]                                  /s/ Ana Patterson
                                        ----------------------------------------
                                        Notary Public

My Commission Expires:                  Ana Patterson
                                        ----------------------------------------
     08-28-2003                         Printed Name of Notary Public
---------------------

SIXTH MODIFICATION AGREEMENT - Page 8
<PAGE>
                                    EXHIBIT A

                       Description of the Deed(s) of Trust

EXHIBIT A, Description of the Deeds of Trust - Page 1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}]]