Document:

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                                                                  Exhibit 10.2.5

                         SEVENTH MODIFICATION AGREEMENT

         This SEVENTH MODIFICATION AGREEMENT (this "Agreement") is made and
entered into as of ___________________, 2001, by and between LEGACY/MONTEREY
HOMES L.P., an Arizona limited partnership ("Borrower"), and GUARANTY BANK, a
federal savings bank (formerly known as "Guaranty Federal Bank, F.S.B.")
("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

         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 Deeds of Trust were further pursuant to a Sixth
Modification Agreement (the "Sixth Modification") dated as of July 31, 2000, and
recorded in various counties in Texas, which Sixth 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

SEVENTH MODIFICATION AGREEMENT - Page 1
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         WHEREAS, the Loan Agreement, the Note, the First Modification, the
Second Modification, the Third Modification, the Fourth Modification, the Fifth
Modification, the Sixth 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 May 31, 2002, 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.")

         3. The Loan is hereby increased from $65,000,000.00 to $75,000,000.00.
All references in the Loan Instruments to the amount of $65,000,000.00 are
hereby increased to $75,000,000.00.

         4. 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.

         5. 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.

SEVENTH MODIFICATION AGREEMENT - Page 2

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         6. 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 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.

         7. 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).

         8. 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).

         9. 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.

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

         11. 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.

         12. 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.

         13. 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.]

SEVENTH MODIFICATION AGREEMENT - Page 3

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

                                     LENDER:

                                     GUARANTY BANK
                                     a federal savings bank
                                     (formerly known as "Guaranty Federal Bank,
                                     F.S.B.")

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

SEVENTH MODIFICATION AGREEMENT - Page 4

<PAGE>   5

STATE OF _____________            }
                                  }
COUNTY OF ___________             }

         This instrument was ACKNOWLEDGED before me on _________________, 2001,
by _________________________________________, _______________________________ 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.

[S E A L]
                                        ________________________________________
                                        Notary Public

My Commission Expires:

_____________________                   ________________________________________
                                        Printed Name of Notary Public

STATE OF TEXAS                        }
                                      }
COUNTY OF DALLAS                      }

         This instrument was acknowledged before me on the _____ day of
________________, 2001, by _________________________________,
___________________ of GUARANTY BANK, a federal savings bank, on behalf of said
federal savings bank.

                                        ________________________________________
                                         Notary Public in and for the
                                         above county and state

My Commission Expires:

_____________________                   ________________________________________
                                         Printed Name of Notary Public

SEVENTH MODIFICATION AGREEMENT - Page 5

<PAGE>   6

                              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 Seventh 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 ______ day of ___________, 2001.

                                   GUARANTOR:

                                   MERITAGE CORPORATION,
                                   a Maryland corporation

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

                                   MTH-TEXAS GP, INC.,
                                   an Arizona corporation

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

                                   MTH-TEXAS LP, INC.,
                                   an Arizona corporation

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

SEVENTH MODIFICATION AGREEMENT - Page 6

<PAGE>   7

STATE OF TEXAS                        }
                                      }
COUNTY OF DALLAS                      }

         This instrument was ACKNOWLEDGED before me on _________________, 2000,
by _________________________________________, _______________________________ of
MERITAGE CORPORATION, a Maryland corporation, on behalf of said corporation.

[S E A L]
                                       _________________________________________
                                       Notary Public
My Commission Expires:

_____________________                  Printed Name of Notary Public

STATE OF TEXAS                        }
                                      }
COUNTY OF DALLAS                      }

         This instrument was ACKNOWLEDGED before me on _________________, 2000,
by _________________________________________, _______________________________ of
MTH-TEXAS GP, INC., an Arizona corporation, on behalf of said corporation.

[S E A L]
                                      __________________________________________
                                      Notary Public
My Commission Expires:

_____________________                 Printed Name of Notary Public

SEVENTH MODIFICATION AGREEMENT - Page 7

<PAGE>   8
                                    EXHIBIT A

                       Description of the Deed(s) of Trust

LEGACY/MONTEREY, L.P.

Collin County  Recorded September 4, 1996, Clerk File 96-0075977

Dallas         Recorded September 5, 1996, Volume 96175 Page 00192

Denton         Recorded September 5, 1996, Clerk File 96-R0061921

Fort Bend      Recorded January 28, 1999, Clerk File 199900703

Harris         Recorded August 6, 1997, Clerk File No. S579911

Hays           Recorded September 21, 2000, Clerk File No. 22586

Rockwall       Recorded August 19, 1997, Clerk File No. 176219

Tarrant        Recorded September 5, 1996, Clerk File D196175179

Travis         Recorded September 6, 1996,Volume 12766, Page 1157

Williamson     Recorded September 9, 1996, Clerk File 9648096

EXHIBIT A, Description of the Deeds of Trust - Page 1Exhibit 4.1

                                                             EXECUTION COPY

                                    AMENDMENT NO. 3 dated as of June 24,
                           2001, to the Rights Agreement dated as of
                           October 16, 1987, and amended as of October 15,
                           1997 and as of December 3, 1998 (as amended
                           prior to the date hereof, the "Rights
                           Agreement"), by and between HOMESTAKE MINING
                           COMPANY, a Delaware corporation (the "Company"),
                           and FLEET NATIONAL BANK N.A., a national banking
                           association, as successor to BANK OF AMERICA
                           NATIONAL TRUST AND SAVING ASSOCIATION, a
                           national banking corporation, as Rights Agent
                           (the "Rights Agent").

          WHEREAS, pursuant to Section 26 of the Rights Agreement, any
amendment or supplement to the Rights Agreement duly approved by the
Company that does not amend Section 19, 20, 21 or 22 in a manner adverse to
the Rights Agent shall become effective immediately upon execution by the
Company, whether or not also executed by the Rights Agent.

          NOW, THEREFORE, pursuant to the terms of the Rights Agreement and
in accordance with Section 26 thereof, the following actions are hereby
taken prior to executing the Merger Agreement referred to below:

          Section 1. Amendments to Rights Agreement. The Rights Agreement
is hereby amended as follows:

          (a) The definition of "Acquiring Person" in Section 1 of the
Rights Agreement is amended to add the following sentence at the end
thereof:

               "Notwithstanding anything in this Agreement to the contrary,
               neither Barrick Gold Corporation nor any of its Affiliates
               or Associates (hereinafter, collectively, "Barrick") shall
               be deemed to be an Acquiring Person, either individually or
               collectively, solely by virtue of (i) the approval,
               execution or delivery of the Merger Agreement or the
               Stockholders Agreement, (ii) the announcement of the Merger,
               (iii) the acquisition or conversion of the Common Stock or
               Homestake Special Voting Stock pursuant to the Merger or the
               Merger Agreement or (iv) the consummation of the Merger or
               of the other transactions contemplated by the Merger
               Agreement or the Stockholders Agreement."

<PAGE>

                                                                          2

          (b) Section 3(b) of the Rights Agreement is amended to add the
following sentence immediately after the first sentence thereof:

               "Notwithstanding anything in this Agreement to the contrary,
               no Distribution Date shall be deemed to have occurred solely
               as the result of (i) the approval, execution or delivery of
               the Merger Agreement or the Stockholders Agreement, (ii) the
               announcement of the Merger, (iii) the acquisition or
               conversion of the Common Stock or Homestake Special Voting Stock
               pursuant to the Merger or the Merger Agreement or (iv) the
               consummation of the Merger or of the other transactions
               contemplated by the Merger Agreement or the Stockholders
               Agreement."

          (c) Clause (i) of the first sentence of Section 7(a) of the
Rights Agreement is amended and restated to read in its entirety as
follows:

               "(i) the earlier of (1) the Close of Business on October 15,
               2007 and (2) immediately prior to the Effective Time of the
               Merger (such earlier time being the "Expiration Date"), or
               ".

          (d) The following definitions shall be added to Section 1 of the
Rights Agreement:

               "Effective Time of the Merger" has the meaning set forth in
               the Merger Agreement.

               "Merger" has the meaning set forth in the Merger Agreement.

               "Merger Agreement" means the Agreement and Plan of Merger
               dated as of June 24, 2001, among Barrick Gold Corporation,
               Havana Acquisition Inc. and Homestake Mining Company.

               "Stockholders Agreement" has the meaning set
               forth in the Merger Agreement.

          Section 2. Full Force and Effect. Except as expressly amended
hereby, the Rights Agreement shall continue in full force and effect in
accordance with the provisions thereof on the date hereof.

          Section 3. Governing Law. This Amendment shall be governed by and
construed in accordance with the law of the State of Delaware applicable to
contracts to be made and performed entirely within such State.

<PAGE>

          3 IN WITNESS WHEREOF, the Company and the Rights Agent have
caused this Amendment to be duly executed as of the day and year first
above written.

                                           HOMESTAKE MINING COMPANY,

                                           by:   /s/ Wayne Kirk
                                              --------------------------------
                                              Name:  Wayne Kirk
                                              Title: Vice President

                                           FLEET NATIONAL BANK N.A.,
                                           as Right Agent,

                                           by:
                                              --------------------------------
                                              Name:
                                              Title:

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