Document:

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                     SETTLEMENT AGREEMENT AND MUTUAL RELEASE

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      This Settlement Agreement and Mutual Release (the "Agreement") is entered
into effective as of (although not necessarily executed on) February 18, 2005
(the "Effective Date") by and between Southwest Securities Bank, formerly known
as First Savings Bank, FSB ("SSB") and Richard Driscoll ("Driscoll") on the one
hand, and United Heritage Corporation ("UHC"), Walter G. Mize ("Mize,") and
ALMAC Financial Corporation ("ALMAC") on the other (SSB, Driscoll, UHC, Mize,
and ALMAC are collectively referred to herein as the "Parties").

      WHEREAS, UHC obtained a line of credit from SSB in the full sum and amount
of two million and no/100 dollars ($2,000,000.00) evidenced by the following
documents: (a) that certain Loan Agreement dated April 25, 2000 between and
among SSB and UHC; (b) that certain Promissory Note # 38728 dated April 25, 2000
between and among SSB and UHC; (c) that certain Promissory Note # 38728
(renewal) dated April 25, 2001; and (d) that certain Third Party Pledge
Agreement executed by Mize dated April 25, 2000 (collectively, the "Loan
Agreements");

      WHEREAS, SSB declared UHC in default and demanded repayment on the Loan
Agreements and UHC denied such default and any obligation of repayment;

      WHEREAS, the Parties agree that this Agreement is being entered into in
the "ordinary course of business" as that phrase is used in Title 11 of the
United States Code as now in effect or hereafter amended;

      WHEREAS, UHC and Mize filed a lawsuit against SSB and Driscoll in Cause
No. C200300135, styled United Heritage Corporation and Walter G. Mize v. First
Savings Bank, FSB, a Federal Savings Bank and Richard D. Driscoll, which is
currently pending in the 249th Judicial District Court of Johnson County, Texas
(the "Lawsuit"); and

                                                                    Page 1 of 18
<PAGE>

      WHEREAS, the Parties desire to settle and compromise all matters in
controversy between them, including but not limited to the Lawsuit, and to enter
into certain releases and covenants as set forth herein;

      NOW, THEREFORE, in consideration of the mutual promises and agreements set
forth herein, including the recitals set forth above, the receipt and
sufficiency of which is acknowledged, the Parties agree as follows:

      1. Mutual Releases.

      1.1. UHC's Release of SSB and Driscoll. Upon the execution of this
Agreement, UHC, on behalf of itself, and its officers, directors, principals,
shareholders, parents, subsidiaries, affiliates, members, attorneys, successors,
employees, agents, partners, insurers, underwriters, representatives, and
assigns, hereby FULLY RELEASES, HOLDS HARMLESS, REMISES AND FOREVER DISCHARGES
SSB, its officers, directors, principals, shareholders, parents, subsidiaries,
specifically including but not limited to Southwest Securities, Inc. and SWS
Group, Inc., and SSB's affiliates, members, attorneys (including but not limited
to Lisa M. Powell, David J. Drez III, Thomas J. Williams, Craig M. Price, Karen
D. Coomer, Gregory R. Samuel and Craig Unterberg), successors, employees,
agents, partners, insurers, underwriters, representatives, and assigns and
Driscoll, including his attorneys (including but not limited to Lisa M. Powell,
David J. Drez III, Thomas J. Williams, Craig M. Price, Karen D. Coomer, Gregory
R. Samuel and Craig Unterberg), agents, partners, insurers, representatives,
successors and assigns, of and from any and all claims, actions, causes of
action, appeals, suits, rights, obligations, damages, losses, charges, debts,
liabilities, and demands whatsoever, WHETHER FORESEEN OR UNFORESEEN, KNOWN OR
UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, in law, equity or
otherwise, which UHC has, may have or has had that relate in any way to the Loan
Agreements and/or any and all prior dealings between the Parties as of the
Effective Date hereof, of any type or character, including but not limited to
any claims for fraud, fraud in the inducement, negligent misrepresentation,
promissory estoppel, tortious interference with contract, tortious interference
with prospective business relations, negligence, breach of contract, breach of
the duty of good faith and fair dealing, breach of fiduciary duty, violation of
any provision of the Texas Business and Commerce Code, and any claim for
equitable relief that could have been or has been asserted, and any claims that
were asserted or could have been asserted in the Lawsuit, save and except for
the obligations imposed by this Agreement.

                                                                    Page 2 of 18
<PAGE>

      1.2. Mize's Release of SSB and Driscoll. Upon the execution of this
Agreement, Mize, on behalf of himself, and his attorneys, agents, partners,
insurers, representatives, successors, and assigns, hereby FULLY RELEASES, HOLDS
HARMLESS, REMISES AND FOREVER DISCHARGES SSB, its officers, directors,
principals, shareholders, parents, subsidiaries, specifically including but not
limited to Southwest Securities, Inc. and SWS Group, Inc., and SSB's affiliates,
members, attorneys, successors, employees, agents, partners, insurers,
underwriters, representatives, and assigns and Driscoll, including his attorneys
(including but not limited to Lisa M. Powell, David J. Drez III, Thomas J.
Williams, Craig M. Price, Karen D. Coomer, Gregory R. Samuel and Craig
Unterberg), agents, partners, insurers, representatives, successors and assigns,
of and from any and all claims, actions, causes of action, appeals, suits,
rights, obligations, damages, losses, charges, debts, liabilities, and demands
whatsoever, WHETHER FORESEEN OR UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR
UNDISCLOSED, MATURED OR UNMATURED, in law, equity or otherwise, which Mize has,
may have or has had that relate in any way to the Loan Agreements and/or any and
all prior dealings between the Parties as of the Effective Date hereof, of any
type or character, including but not limited to any claims for fraud, fraud in
the inducement, negligent misrepresentation, promissory estoppel, tortious
interference with contract, tortious interference with prospective business
relations, negligence, breach of contract, breach of the duty of good faith and
fair dealing, breach of fiduciary duty, violation of any provision of the Texas
Business and Commerce Code, and any claim for equitable relief that could have
been or has been asserted, and any claims that were asserted or could have been
asserted in the Lawsuit, save and except for the obligations imposed by this
Agreement.

                                                                    Page 3 of 18
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      1.3. SSB's Release of Mize and UHC. Upon the Execution of this Agreement,
SSB, on behalf of itself, and its officers, directors, principals, shareholders,
parents, subsidiaries, affiliates, members, attorneys, successors, employees,
agents, partners, insurers, underwriters, representatives, assigns, including
SWS Group, Inc. and Southwest Securities, Inc., hereby FULLY RELEASES, HOLDS
HARMLESS, REMISES AND FOREVER DISCHARGES Mize, together with his attorneys
(including but not limited to Jeffrey S. Davis, Michael J. Rogers, and Rex D.
Davis), agents, partners, insurers, representatives, successors, and assigns and
UHC, together with its officers, directors, principals, shareholders, parents,
subsidiaries, members, attorneys (including but not limited to Jeffrey S. Davis,
Michael J. Rogers, and Rex D. Davis), successors, employees, agents, partners,
insurers, underwriters, representatives, and assigns, of and from any and all
claims, actions, causes of action, appeals, suits, rights, obligations, damages,
losses, charges, debts, liabilities, and demands whatsoever, WHETHER FORESEEN OR
UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, in
law, equity or otherwise, which SSB has, may have or has had that relate in any
way to the Loan Agreements and/or any and all prior dealings between the Parties
as of the Effective Date hereof, of any type or character, including but not
limited to any claims for fraud, fraud in the inducement, negligent
misrepresentation, promissory estoppel, tortious interference with contract,
tortious interference with prospective business relations, negligence, breach of
contract, breach of the duty of good faith and fair dealing, breach of fiduciary
duty, violation of any provision of the Texas Business and Commerce Code, and
any claim for equitable relief that could have been or has been asserted, and
any claims that were asserted or could have been asserted in the Lawsuit, save
and except for the obligations imposed by this Agreement.

                                                                    Page 4 of 18
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      1.4. Driscoll's Release of Mize and UHC. Upon the execution of this
Agreement, Driscoll, on behalf of himself and his attorneys, agents, partners,
insurers, representatives, successors, and assigns, hereby FULLY RELEASES, HOLDS
HARMLESS, REMISES AND FOREVER DISCHARGES Mize, together with his agents,
attorneys (including but not limited to Jeffrey S. Davis, Michael J. Rogers, and
Rex D. Davis), partners, insurers, representatives, successors, and assigns and
UHC, together with its officers, directors, principals, shareholders, parents,
subsidiaries, members, attorneys (including but not limited to Jeffrey S. Davis,
Michael J. Rogers, and Rex D. Davis), successors, employees, agents, partners,
insurers, underwriters, representatives, and assigns, of and from any and all
claims, actions, causes of action, appeals, suits, rights, obligations, damages,
losses, charges, debts, liabilities, and demands whatsoever, WHETHER FORESEEN OR
UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, in
law, equity or otherwise, which Driscoll has, may have or has had that relate in
any way to the Loan Agreements and/or any and all prior dealings between the
Parties as of the Effective Date hereof, of any type or character, including but
not limited to any claims for fraud, fraud in the inducement, negligent
misrepresentation, promissory estoppel, tortious interference with contract,
tortious interference with prospective business relations, negligence, breach of
contract, breach of the duty of good faith and fair dealing, breach of fiduciary
duty, violation of any provision of the Texas Business and Commerce Code, and
any claim for equitable relief that could have been or has been asserted, and
any claims that were asserted or could have been asserted in the Lawsuit, save
and except for the obligations imposed by this Agreement.

                                                                    Page 5 of 18
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      1.5. SSB's Release of ALMAC. Upon the Execution of this Agreement, SSB, on
behalf of itself, and its officers, directors, principals, shareholders,
parents, subsidiaries, affiliates, members, attorneys, successors, employees,
agents, partners, insurers, underwriters, representatives, assigns, including
SWS Group, Inc. and Southwest Securities, Inc., hereby FULLY RELEASES, HOLDS
HARMLESS, REMISES AND FOREVER DISCHARGES ALMAC, together with its officers,
directors, principals, shareholders, parents, subsidiaries, members, attorneys
(including but not limited to Jeffrey S. Davis, Michael J. Rogers, and Rex D.
Davis), successors, employees, agents, partners, insurers, underwriters,
representatives, and assigns, of and from any and all claims, actions, causes of
action, appeals, suits, rights, obligations, damages, losses, charges, debts,
liabilities, and demands whatsoever, WHETHER FORESEEN OR UNFORESEEN, KNOWN OR
UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, in law, equity or
otherwise, which SSB has, may have or has had that relate in any way to the Loan
Agreements and/or any and all prior dealings between the Parties as of the
Effective Date hereof, of any type or character, including but not limited to
any claims for fraud, fraud in the inducement, negligent misrepresentation,
promissory estoppel, tortious interference with contract, tortious interference
with prospective business relations, negligence, breach of contract, breach of
the duty of good faith and fair dealing, breach of fiduciary duty, violation of
any provision of the Texas Business and Commerce Code, and any claim for
equitable relief that could have been or has been asserted, and any claims that
were asserted or could have been asserted in the Lawsuit, save and except for
the obligations imposed by this Agreement.

                                                                    Page 6 of 18
<PAGE>

      1.6. ALMAC's Release of SSB and Driscoll. Upon the Execution of this
Agreement, ALMAC, on behalf of itself, and its officers, directors, principals,
shareholders, parents, subsidiaries, affiliates, members, attorneys, successors,
employees, agents, partners, insurers, underwriters, representatives, and
assigns, hereby FULLY RELEASES, HOLDS HARMLESS, REMISES AND FOREVER DISCHARGES
Driscoll, together with his attorneys (including but not limited to Lisa M.
Powell, David J. Drez III, Thomas J. Williams, Craig M. Price, Karen D. Coomer,
Gregory R. Samuel and Craig Unterberg), agents, partners, insurers,
representatives, successors, and assigns and hereby FULLY RELEASES, HOLDS
HARMLESS, REMISES AND FOREVER DISCHARGES SSB, together with its officers,
directors, principals, shareholders, parents, subsidiaries, specifically
including but not limited to Southwest Securities, Inc. and SWS Group, Inc., and
SSB's affiliates, members, attorneys (including but not limited to David J. Drez
III, Thomas J. Williams, Craig M. Price, Karen D. Coomer, Gregory R. Samuel and
Craig Unterberg), successors, employees, agents, partners, insurers,
underwriters, representatives, and assigns, of and from any and all claims,
actions, causes of action, appeals, suits, rights, obligations, damages, losses,
charges, debts, liabilities, and demands whatsoever, WHETHER FORESEEN OR
UNFORESEEN, KNOWN OR UNKNOWN, DISCLOSED OR UNDISCLOSED, MATURED OR UNMATURED, in
law, equity or otherwise, which ALMAC has, may have or has had that relate in
any way to the Loan Agreements and/or any and all prior dealings between the
Parties as of the Effective Date hereof, of any type or character, including but
not limited to any claims for fraud, fraud in the inducement, negligent
misrepresentation, promissory estoppel, tortious interference with contract,
tortious interference with prospective business relations, negligence, breach of
contract, breach of the duty of good faith and fair dealing, breach of fiduciary
duty, violation of any provision of the Texas Business and Commerce Code, and
any claim for equitable relief that could have been or has been asserted, and
any claims that were asserted or could have been asserted in the Lawsuit, save
and except for the obligations imposed by this Agreement.

                                                                    Page 7 of 18
<PAGE>

      1.7. Release and Waiver of DTPA claims. Without acknowledging that any
claim or cause of action as it relates to this Agreement and/or any prior
dealings between the Parties could be alleged or asserted by Mize, UHC or ALMAC
under the Texas Deceptive Trade Practices and Consumer Protection Act ("DTPA"),
by signing this Agreement, Mize, individually and on behalf of UHC and ALMAC,
acknowledges and states as follows: "I waive my rights under the Deceptive Trade
Practices-Consumer Protection Act, Section 17.41 et seq., Business & Commerce
Code, a law that gives consumers special rights and protections. After
consultation with an attorney of my own selection, I voluntarily consent to this
waiver."

      2. Consideration.

      2.1. Payment to SSB. Simultaneously with the execution of this Agreement
by all Parties, UHC shall tender the full sum and amount of seven hundred
thousand and no/100 dollars ($700,000.00) to SSB, by cashier's check or
certified funds check personally delivered to SSB's counsel of record.

                                                                    Page 8 of 18
<PAGE>

      2.2. Stock certificate and promissory notes.

            2.2.1. Release of Stock Certificate 8406. Concurrently with the
execution of this Agreement, SSB will release all rights, claims and title in
and to United Heritage Corporation Stock Certificate Number 8406 and direct and
authorize Computershare Trust Company to release United Heritage Corporation
stock certificate 8406 to Mize by providing Mize or his attorneys with an
executed letter in the same form as that set forth in Exhibit A to this
Agreement. Furthermore, in connection with this paragraph 2.2, SSB agrees to
promptly terminate all uniform commercial code financing statements filed by SSB
against Mize relating to the United Heritage Corporation Stock Certificate
Number 8406.

            2.2.2 Promissory notes.Simultaneously with the execution of this
Agreement by the Parties, SSB shall deliver to UHC the aforementioned Loan
Agreement dated April 25, 2000, Promissory Note #38728, dated April 25, 2000,
the Promissory Note (renewed) #38728, dated April 25, 2001, and the Third-Party
Pledge Agreement executed by Mize, dated April 25, 200, all of which shall be
marked as follows: "Paid-in-full/Released."

      2.3. The Parties acknowledge that the consideration provided for in
section 2 of this Agreement is good and sufficient consideration for the
releases provided in section 1 of this Agreement and will constitute full and
final settlement of the Parties' claims, including but not limited to payment in
full of the Promissory Note and Loan Agreement and ALMAC's, Mize's, and UHC full
and final release of any and all claims against SSB and Driscoll, as set forth
in section 1 of this Agreement..

      3. Dismissal of the Lawsuit. Within three (3) business days after
execution of this Agreement by all Parties and SSB's receipt of the payment
referenced in paragraph 2.1 above, the Parties, by and through their counsel of
record, will execute and file an Agreed Motion to Dismiss the Lawsuit with
prejudice in substantially the same form as that attached hereto as Exhibit B
and submit to the Court a proposed Agreed Order of Dismissal with Prejudice in
substantially the same form as that attached hereto as Exhibit C.

                                                                    Page 9 of 18
<PAGE>

      4. Bankruptcy. If UHC files for bankruptcy pursuant to Title 11 of the
United States Code, UHC agrees that (a) SSB shall have an allowed claim against
UHC in an amount at least equal to any consideration due SSB under the terms of
this Agreement; and (b) UHC will not dispute that this Agreement has been
entered into in the ordinary course of business.

      5. Miscellaneous Provisions.

      5.1. Reliance on Counsel. Mize, UHC, and ALMAC agree that no
representations have been made by SSB or Driscoll or their attorneys (including
but not limited to Lisa M. Powell, David J. Drez III, Thomas J. Williams, Craig
M. Price, Karen D. Coomer, Gregory R. Samuel and Craig Unterberg) inducing them
to execute this Agreement and neither this Agreement nor its terms constitute
legal advice on the part of SSB, Driscoll, Lisa Powell, or Haynes and Boone, LLP
(including but not limited to David J. Drez III, Thomas J. Williams, Craig M.
Price, Karen D. Coomer, Gregory R. Samuel and Craig Unterberg). SSB and Driscoll
agree that no representations have been made by UHC, Mize or ALMAC or their
attorneys (including but not limited to Jeffrey S. Davis, Michael J. Rogers, and
Rex D. Davis) inducing them to execute this Agreement and SSB and Driscoll
further agree that neither this Agreement nor its terms constitute legal advice
on the part of UHC, Mize, ALMAC, the Law Offices of Michael J. Rogers, P.C., or
Sheehy, Lovelace & Mayfield, P.C. (including but not limited to Jeffrey S.
Davis, Michael J. Rogers, and Rex D. Davis).

      5.2. Comprehension of Documents/Acceptance of Terms. In entering into this
Agreement, the Parties acknowledge that they have read and understand each
provision of this Agreement, that they have had the opportunity to consult with
an attorney of their own choosing regarding this Agreement and its terms, and
further that those terms are fully, freely, and voluntarily accepted.

                                                                   Page 10 of 18
<PAGE>

      5.3. Severability. If any provision of this Agreement is determined by a
court of competent jurisdiction to be invalid or unenforceable in any respect,
such determination shall not affect any other provision of this Agreement, and
this Agreement shall be enforced as if the invalid provision did not exist.

      5.4. Warranty of Capacity and Non-Assignment of Claims. The Parties,
individually and on behalf of any other person or entity, specifically
acknowledge, represent and warrant that they are authorized to enter into this
Agreement individually and on behalf of the persons or entities for whom they
purport to have authority. Further, the Parties hereby represent and warrant
that they each are the only and lawful owner of any and all claims that were
asserted or could have been asserted in the Lawsuit and that no portion of any
claim being released pursuant to this Agreement has been assigned or conveyed to
any other person, party or entity.

      5.5. Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Texas.

      5.6. No admission of liability. This Agreement is a compromise and
settlement of disputed claims and is not an admission by the Parties, or any of
them, of any duty, liability, obligation or improper or wrongful conduct in
connection with any matter in dispute or otherwise, all such liability being
denied by all Parties.

      5.7. Entire Agreement/Merger. IT IS UNDERSTOOD AND AGREED THAT THIS
AGREEMENT CONTAINS THE ENTIRE AGREEMENT BETWEEN THE PARTIES AND SUPERSEDES ANY
AND ALL PRIOR AGREEMENTS, ARRANGEMENTS, OR UNDERSTANDINGS BETWEEN THE PARTIES
RELATING TO THE SUBJECT MATTER. NO ORAL UNDERSTANDINGS, STATEMENTS, PROMISES OR
INDUCEMENTS CONTRARY TO THE TERMS OF THIS AGREEMENT EXIST. THIS AGREEMENT CANNOT
BE CHANGED, ALTERED OR TERMINATED ORALLY.

                                                                   Page 11 of 18
<PAGE>

      5.8. Taxes. The Parties understand and agree that none of the Parties or
their attorneys have made and do not make any representation or warranty
regarding the taxability or non-taxability of any of the consideration exchanged
pursuant to this Agreement.

      5.9. Further assurances. The Parties agree to execute such other and
further documents and/or pleadings and to perform such other acts as may be
reasonably necessary to evidence or carry out the terms and provisions of this
Agreement.

      5.10. Multiple Originals. This Agreement may be executed in a number of
identical counter-parts, each of which shall be deemed an original for all
purposes and facsimile or copies of this Agreement and the signatures hereto
will be deemed an original for all purposes.

      5.11. No oral modifications. This Agreement may not be modified, amended
or terminated orally. No modification, amendment or termination, or any claimed
waiver of any of the provisions of this Agreement, shall be binding unless same
is in writing and signed by the person against whom such modification, amendment
or waiver is sought to be enforced.

      5.12. Terms contractual. The terms and conditions of this Agreement are
contractual and not merely recitals and all are material consideration for this
Agreement.

      5.13. No waiver. The failure of any of the Parties to enforce at any time
any provision of this Agreement shall not be construed to be a waiver of such
provision, nor in any way affect the validity of this Agreement or any part
thereof or any right of any person thereafter to enforce each and every
provision. No waiver of any breach of this Agreement shall be held to constitute
a waiver of any other breach.

                                 Page 12 of 18
<PAGE>

      5.14. Notice. Any notice to any party hereto shall be by certified mail,
return receipt requested and by facsimile as follows and deemed received three
days after such notice is post-marked:

      If to SSB or Driscoll:           If to UHC, Mize or ALMAC:
      Southwest Securities Bank        United Heritage Corporation
      Attention: Richard Driscoll      Attention: Walter G. Mize
      301 South Center, Suite 120      2 Caddo Street
      Arlington, Texas  76010          Cleburne, Texas 76031
      Facsimile: (817) 861-9282        Facsimile: (817) 641-3683

      and                              - with a copy to -

      Jerry Wade, Esq.                 Jeffrey Davis
      Southwest Securities, Inc.       Michael J. Rogers, P.C.
      1201 Elm Street, Suite 3500      108 East Chambers
      Dallas, Texas 75270              Cleburne, Texas  76033
      Facsimile: (214) 658-9312        Telephone: (817) 558-4323
                                       Facsimile: (817) 645-2175

      - with a copy to -

                                       Rex D. Davis
      David J. Drez III                Sheehy, Lovelace & Mayfield, P.C.
      Haynes and Boone, LLP            510 North Valley Mills Drive, Suite 500
      201 Main Street, Suite 2200      Waco, Texas  76710
      Fort Worth, Texas  76102         Telephone: (254) 772-8022
      Telephone: (817) 347-6628        Facsimile: (254) 772-9297
      Facsimile: (817) 348-2322

                *** SIGNATURE BLOCKS APPEAR ON FOLLOWING PAGE ***

                                                                   Page 13 of 18
<PAGE>

UNITED HERITAGE CORPORATION                                     DATED:

By: /s/ Walter G. Mize                                         2/18/05
   ---------------------------------                    -----------------------
   Its President

WALTER G. MIZE, individually                                    DATED:

/s/ Walter G. Mize                                             2/18/05
------------------------------------                    -----------------------

ALMAC FINANCIAL CORPORATION                                     DATED:

By: /s/ Walter G. Mize                                         2/18/05
   ---------------------------------                    -----------------------
   Its President

                                                                   Page 14 of 18
<PAGE>

SOUTHWEST SECURITIES BANK, formerly known as                    DATED:
FIRST SAVINGS BANK, FSB

By: /s/ Richard Driscoll                                        2-17-05
   ---------------------------------                    -----------------------
   Its CEO

RICHARD DRISCOLL, individually                                   DATED:

/s/ Richard Driscoll                                            2-17-05
------------------------------------

                                                                   Page 15 of 18
<PAGE>

                 ACKNOWLEDGEMENT OF UNITED HERITAGE CORPORATION

STATE OF TEXAS         ss.
                       ss.
COUNTY OF JOHNSON      ss.

      Before me, a Notary Public, on this day personally appeared WALTER G.
MIZE, known to me to be the person and officer whose name is subscribed to the
foregoing instrument and acknowledged to me that the same was the act of UNITED
HERITAGE CORPORATION, and that he executed the same on behalf of said
corporation for the purposes and consideration therein expressed, and in the
capacity therein stated.

      Given under my hand and seal of office this 18th day of February, 2005.

                                        /s/ Barbara L. Broadus
                                        ----------------------------------------
                                        Notary Public in and for the
                                        State of Texas
(SEAL)

                        ACKNOWLEDGEMENT OF WALTER G. MIZE

STATE OF TEXAS         ss.
                       ss.
COUNTY OF JOHNSON      ss.

      Before me, a Notary Public, on this day personally appeared WALTER G. MIZE
known to me to be the person whose name is subscribed to the foregoing
instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.

      Given under my hand and seal this 18th day of February, 2005.

                                        /s/ Barbara L. Broadus
                                        ----------------------------------------
                                        Notary Public in and for the
                                        State of Texas
(SEAL)

<PAGE>

                 ACKNOWLEDGEMENT OF ALMAC FINANCIAL CORPORATION

STATE OF TEXAS         ss.
                       ss.
COUNTY OF JOHNSON      ss.

      Before me, a Notary Public, on this day personally appeared WALTER G.
MIZE, known to me to be the person and officer whose name is subscribed to the
foregoing instrument and acknowledged to me that the same was the act of ALMAC
FINANCIAL CORPORATION, and that he executed the same on behalf of said
corporation for the purposes and consideration therein expressed, and in the
capacity therein stated.

      Given under my hand and seal of office this 18th day of February, 2005.

                                        /s/ Barbara L. Broadus
                                        ----------------------------------------
                                        Notary Public in and for the
                                        State of Texas
(SEAL)

<PAGE>

                  ACKNOWLEDGMENT OF SOUTHWEST SECURITIES BANK,
                    FORMERLY KNOWN AS FIRST SAVINGS BANK, FSB

STATE OF TEXAS         ss.
                       ss.
COUNTY OF TARRANT      ss.

      Before me, a Notary Public, on this day personally appeared RICHARD
DRISCOLL, known to me to be the person and officer whose name is subscribed to
the foregoing instrument and acknowledged to me that the same was the act of
SOUTHWEST SECURITIES BANK, formerly known as FIRST SAVINGS BANK, FSB, and that
he executed the same on behalf of said corporation for the purposes and
consideration therein expressed, and in the capacity therein stated.

      Given under my hand and seal of office this 17th day of February, 2005.

                                        /s/ Vicky Miller
                                        ----------------------------------------
                                        Notary Public in and for the
                                        State of Texas
(SEAL)

                       ACKNOWLEDGEMENT OF RICHARD DRISCOLL

STATE OF TEXAS         ss.
                       ss.
COUNTY OF TARRANT      ss.

      Before me, a Notary Public, on this day personally appeared RICHARD
DRISCOLL, known to me to be the person whose name is subscribed to the foregoing
instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.

      Given under my hand and seal this 17th day of February, 2005.

                                        /s/ Vicky Miller
                                        ----------------------------------------
                                        Notary Public in and for the
                                        State of Texas
(SEAL)REORGANIZATION AGREEMENT

         REORGANIZATION AGREEMENT (the "Agreement"), dated January __, 2005, by
and between United Heritage Corporation, a Utah corporation (the "UHCP"),
National Heritage Sales Corp., a wholly-owned Texas subsidiary of UHCP ("NHSC"),
and Heritage Food Group, Inc., a newly formed wholly-owned Delaware corporation
(the "Subsidiary Corporation").

         Whereas, UHCP, through its wholly-owned subsidiaries, engages primarily
in the business of producing oil and gas;

         Whereas, NHSC owns certain intellectual property and other assets
relating to meat and poultry products;

         Whereas, UHCP believes that it is in the best interest of UHCP to seek
to facilitate the sale, transfer and/or separation of the business of NHSC;

         Whereas, UHCP believes that it is in the best interests of UHCP and
NHSC that substantially all of the assets and operations of NHSC, less all
liabilities, be transferred into Subsidiary Corporation in order to facilitate
such sale, transfer and/or separation;

         Whereas UHCP has organized the Subsidiary Corporation in the State of
Delaware to acquire substantially all of the assets of NHSC, net of all
liabilities, in exchange solely for the common stock of the Subsidiary
Corporation.

         Now, therefore, in consideration of the premises and the respective
agreements hereinafter set forth, the parties agree as follows:

                                   ARTICLE I.
                                   DEFINITIONS

         General Definitions. Whenever used herein, the following terms shall
have the meaning set forth below:

         "Affiliate" means a Person that directly or indirectly through one or
more intermediaries controls, is controlled by or is under common control with
the Person specified.

         "Assets" means assets, properties and rights (including Intellectual
Property and goodwill), wherever located (including in the possession of vendors
or other third parties or elsewhere), whether real, personal or mixed, tangible,
intangible or contingent, in each case whether or not recorded or reflected or
required to be recorded or reflected on the books and records or financial
statements of any Person; however it specifically excludes any assets of UHCP.

                                       1
<PAGE>

         "Excluded Assets" means the following Assets of NHSC: (i) the `CD 6000
Multivac", (ii) the existing lawsuit styled National Heritage Sales Corporation
v. Mark Church and M.C. Development, LLC, Case No. C200200451, 249th Judicial
District, Johnson County, Texas, filed on September 20, 2002, (iii) all
inventory, and (iv) all accounts receivable.

         "Excluded Liabilities" means all of the Liabilities of NHSC.

         "Intellectual Property" means all trademarks, service marks, trade
names, trade dress, domain names, logos, business and product names, slogans,
and registrations and applications for registration or renewal thereof;
copyrights and registrations or renewals thereof; mask works and registrations
thereof; inventions, processes, designs, formulae, trade secrets, know-how,
confidential and technical information; all other intellectual property and
proprietary rights; copies and tangible embodiments thereof (in whatever form or
medium, including electronic media); and licenses of any of the foregoing.

         "Liabilities" shall mean any and all debts, liabilities and
obligations, absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising,
including all costs and expenses relating thereto, and including, without
limitation, those debts, liabilities and obligations arising under any law,
rule, regulation, action, threatened action, order or consent decree of any
governmental entity or any award of any arbitrator of any kind, and those
arising under any contract, commitment or undertaking.

         "Person" means an individual, a partnership, a corporation, a limited
liability company, a trust, an unincorporated organization, a government or any
department or agency thereof or any other entity.

         "Reasonable Efforts" means the obligated party is required to make a
diligent, reasonable and good faith effort to accomplish the applicable
objective. Such obligation, however, does not require any expenditure of funds
or the incurrence of any liability, in either case which is unreasonable in
light of the related objective, nor does it require that the obligated party act
in a manner which would otherwise be contrary to prudent business judgment in
light of the objective attempted to be achieved. The fact that the objective is
not actually accomplished is not dispositive evidence that the obligated party
did not in fact utilize its Reasonable Efforts in attempting to accomplish the
objective.

         "Transferred Assets" means all of the Assets of NHSC, specifically
excluding any assets of UHCP; provided, that the Transferred Assets shall not
include the Excluded Assets. Transferred Assets include: Intellectual Property,
supplies, prepaid expenses, permits, licenses, logos, processes, agreements,
contracts, recipes, flavors, licensed property, patents, Internet domain name
registration(s), brands and trademarks (including, but not limited to, Beef ...
The Way It Should Be!, Heritage Lifestyle Products, Heritage Lifestyle Lite
Beef, Heritage Lifestyle Choice Beef, Heritage Lifestyle Chicken, Heritage
Lifestyle Pork, the Heritage Lifestyle Choice Lite Beef line of fresh meat
products, and the Big City Steakhouse Broiler), and all other intangibles used
or necessary in the ordinary course of business.

                                       2
<PAGE>

         "Transferred Liabilities" means all of the liabilities of NHSC other
than the Excluded Liabilities. There are no Transferred Liabilities pursuant to
this Agreement.

         "Tax" means (i) any net income, alternative or add-on minimum tax,
gross income, gross receipts, sales, use, ad valorem, value added, transfer,
franchise, profits, license, registration, recording, documentary, conveyancing,
gains, withholding on amounts paid to or by UHCP or Subsidiary Corporation,
payroll, employment, excise, severance, stamp, occupation, premium, property,
environmental or windfall profit tax, custom duty or other tax, governmental fee
or other like assessment or charge of any kind whatsoever, together with any
interest, penalty, addition to tax or additional amount imposed by any
governmental authority responsible for the imposition of any such tax (domestic
or foreign), (ii) in the case of Subsidiary Corporation, liability for the
payment of any amount of the type described in clause (i) as a result of being
or having been before the Closing Date a member of an affiliated, consolidated,
combined or unitary group and (iii) liability for the payment of any amounts of
the type described in (i) as a result of being party to any agreement or any
express or implied obligation to indemnify any other Person; and

         1.3 Interpretation. Unless the context of this Agreement otherwise
requires, (a) words of any gender shall be deemed to include each other gender,
(b) words using the singular or plural number shall also include the plural or
singular number, respectively, and (c) reference to "hereof", "herein", "hereby"
and similar terms shall refer to this entire Agreement.

                                   ARTICLE II.
                                    TRANSFERS

         2.1 (a) Transfer of Assets to Subsidiary Corporation. Subject to the
terms and conditions of this Agreement, NHSC will convey and transfer to the
Subsidiary Corporation at the closing hereunder the Transferred Assets,
including, without limitation, its goodwill and its right to the use of its
name. A list of the Transferred Assets is set forth Schedule 2.1(a).

                 Schedule 2.1(a) includes a general description of Intellectual
Property relating to the Transferred Assets, and descriptions of and all
agreements relating to any of the foregoing to which NHSC is a party. NHSC owns,
possess and controls all right, title and interest to, or is exclusively
licensed (with right of sub-license) under, such Intellectual Property. To the
knowledge of NHSC, all such Transferred Assets, including all Intellectual
Property rights, are valid and subsisting and NHSC is unaware of any fact or
asserted right (actual, threatened or implied) which, individually or in the
aggregate, would materially and detrimentally affect the validity, ownership,
enforceability, registrability or commercial value of any proprietary rights
associated with the Transferred Assets.

                 All contracts and agreements relating to the Transferred
Assets, including documents evidencing Intellectual Property, shall be provided
to Subsidiary Corporation in connection with the Closing.

                 NHSC owns, possesses and controls the Transferred Assets free
and clear of all liens, assignments, security interests, claims, mortgages,
encumbrances, charges or title defects of any kind. The Intellectual Property
included in the Transferred Assets have been developed exclusively by persons,
using NHSC's proprietary know-how and technology. To the best of its knowledge,
NHSC is not infringing upon or otherwise acting adversely to the right or
claimed right of any person.

                                       3
<PAGE>

                 The execution and delivery of this Agreement by NHSC, and the
consummation of the within contemplated transaction, will not result in the
creation or imposition of any valid lien, charge, or encumbrance on any of the
Transferred Assets, and will not require the authorization, consent, or approval
of any third party, including any lender or governmental or regulatory agency.

             (b) Transfer of Liabilities to Subsidiary Corporation. There are no
Transferred Liabilities pursuant to this Agreement. NHSC retains all Excluded
Liabilities (whether or not reflected or reserved against in UHCP's balance
sheets, books of account, and records).

             (c) Consideration for Transfer to Subsidiary Corporation. The
Subsidiary Corporation shall issue one share of its common stock to UHCP.

             (d) Misallocated Assets. In the event that at any time or from
time to time (whether prior to, on or after the Closing Date), any party hereto
shall receive or otherwise possess any asset that is allocated to any other
Person pursuant to this Agreement, such party shall promptly transfer, or cause
to be transferred, such asset to the Person so entitled thereto. Prior to any
such transfer, the Person receiving or possessing such asset shall hold such
asset in trust for any such other Person.

             (e) Mistaken Assignments and Assumptions. In addition to those
transfers and assumptions accurately identified and designated by the parties to
take place but which the parties are not able to effect prior to the Closing
Date, there may exist (i) assets that the parties discover were, contrary to the
agreements between the parties, by mistake or omission, transferred to
Subsidiary Corporation or (ii) liabilities that the parties discover were,
contrary to the agreements between the parties, by mistake or omission, assumed
by Subsidiary Corporation. The parties shall cooperate in good faith to effect
the transfer or re-transfer of such assets, and/or the assumption or
re-assumption of such liabilities, to or by the appropriate party and shall not
use the determination that remedial actions need to be taken to alter the
original intent of the parties hereto with respect to the assets to be
transferred to or liabilities to be assumed by Subsidiary Corporation. Each
party shall reimburse the other or make other financial adjustments (e.g.,
without limitation, cash reserves) or other adjustments to remedy any mistakes
or omissions relating to any of the assets transferred hereby or any of the
liabilities assumed hereby.

             (f) The parties shall execute and deliver such other transfer
documents, including assignments of Intellectual Property, as are necessary and
appropriate to consummate the transactions contemplated in this Section 2.1.

                                       4
<PAGE>

                                  ARTICLE III.
                         CLOSING AND CLOSING DELIVERIES

         3.1 Closing Date. The term "Closing" as used herein shall refer to the
actual transfers, assignments, conveyances and deliveries contemplated by
Article II as taking place at the Closing. The Closing shall take place as soon
as reasonably practical following the date upon which the conditions precedent
set forth in Section 5.1 are satisfied or such other effective time as the
parties may agree (the "Closing Date").

         3.2 Deliveries at Closing. With respect to the transactions
contemplated by Article II, UHCP and NHSC shall deliver to Subsidiary
Corporation the following:

                  (A) all such deeds, bills of sale, lease assignments and other
contract assignments and other documents and instruments of sale, transfer,
assignment, conveyance and deliverance as may be necessary and appropriate to
implement the intended transfers contemplated by Article II; and

                  (B) such other documents and instruments as may be reasonably
necessary to implement the transfers contemplated hereby.

         3.3 Cooperation. Each party shall, at the request of the other party,
prior to, on and after the Closing, cooperate with one another by furnishing any
additional information, executing and delivering any additional documents and/or
instruments and doing any and all such other things as may be reasonably
required to consummate or otherwise implement the transactions contemplated by
this Agreement.

                                   ARTICLE IV.
                 PRE-CLOSING FILINGS, CONSENTS AND OTHER MATTERS

         4.1 Governmental Filings. The parties hereto covenant and agree with
each other to promptly file, or cause to be promptly filed, with any
Governmental Authority all such notices, applications (including applications
for permits, licenses and other similar instruments), forms or other documents
as may be necessary to consummate the transactions contemplated hereby.

         4.2 Approval by Transferor's Shareholders. UHCP and NHSC shall have
duly called and given due notice of a meeting of the holders of securities who
are entitled to vote for the purpose of voting upon the transfer contemplated
herein to the Subsidiary Corporation and shall have obtained sufficient votes to
approve the transactions.

         4.3 Consent of Third Parties. UHCP and NHSC shall use Reasonable
Efforts to obtain prior to the Closing any consents, approvals, authorizations
and agreements of and to give all notices and make all other filings with, any
third parties, including Governmental Authorities, necessary to authorize,
permit or approve the consummation of the transactions contemplated hereby or to
continue in effect and to assure that Subsidiary Corporation shall be entitled
to all of the material benefits of NHSC's material contracts (the "Material
Contracts"). The parties shall cooperate with each other with respect thereto.

                                       5
<PAGE>

                                   ARTICLE V.
                              CONDITIONS PRECEDENT

         5.1  Conditions to Closing. The obligations of the parties hereto to
close the transactions hereunder are subject to the following conditions
precedent:

              (a) No investigation, action, suit or proceeding by any
Governmental Authority, and no action, suit proceeding by any other Person,
shall be pending on the Closing Date which challenges, or might reasonably
result in a challenge to, this Agreement or any of the transactions contemplated
hereby, or which claims, or might reasonably give rise to a claim for, damages
in a material amount as a result of the consummation of this Agreement.

              (b) All documents and instruments to be executed and delivered
pursuant to this Agreement, including, without limitation, the documents and
instruments to be delivered pursuant to Article III, shall be reasonably
satisfactory to the parties hereto to whom such documents are to be delivered.

              (c) All required consents and approvals of any Governmental
Authority and the consents and approvals of any other Persons and all permits,
licenses and similar instruments shall have been obtained and be in full force
and effect as of the Closing Date and such consents, approvals, permits,
licenses and other instruments shall not impose any restrictions, limitations or
conditions which would have a material adverse effect on the financial condition
or results of operations of the Business.

                                   ARTICLE VI.
                                   TERMINATION

         6.1  Termination. This Agreement shall be terminated upon the written
mutual agreement of the parties.

                                  ARTICLE VII.
                                  MISCELLANEOUS

         7.1  Further Actions.

              (a) The parties hereto agree to use Reasonable Efforts to take
all actions and to do all things necessary, proper or advisable to consummate
the transactions contemplated hereby at or prior to the Closing.

              (b) The parties shall use Reasonable Efforts to enter into such
agreements and other arrangements (including sublicenses and subleases) with the
appropriate parties as are necessary to ensure that Subsidiary Corporation after
the Closing own or hold the Transferred Assets.

                                       6
<PAGE>

              (c) BMW shall pay or cause to be paid when due UHCP's and
Subsidiary Corporation's reasonable legal fees and expenses incurred in
connection with this Agreement, which amounts shall not constitute Excluded
Liabilities.

              (d) UHCP and NHSC will cooperate with Subsidiary Corporation in
the preparation of delivery of two year audited financial statements of NHSC
and Subsidiary Corporation.

         7.2  Notices. Unless otherwise provided herein, any notice, request,
instruction or other document to be given hereunder by any party to the others
shall be in writing and effective when delivered in person or by courier or
nationally recognized overnight delivery service (with a receipt obtained
therefor), or by facsimile transmission (with an executed copy mailed as
described below), or effective on the date receipt is acknowledged when mailed
by certified mail, postage prepaid, return receipt requested, as follows:

                           If to UHCP:

                           United Heritage Corporation
                           2 North Caddo Street
                           Cleburne, Texas 76031
                           Attn.:  Mr. Walter G. Mize
                           Fax:
                               -------------------------------

                           With a copy to:
                           Kevin Friedmann
                           Richardson & Patel, LLP
                           10900 Wilshire Blvd.
                           Suite 500
                           Los Angeles, CA 90024
                           Fax:  310-208-1154

                           If to National Heritage:

                           National Heritage Sales Corp.
                           Same as United Heritage

                           If to Subsidiary Corporation:

                           Heritage Food Group, Inc.

                           -----------------------------

                           -----------------------------

                           -----------------------------
                           Fax:
                               -------------------------

or to such other place and with such other copies as any party may designate as
to itself by written notice to the others.

                                       7
<PAGE>

         7.3 Entire Agreement. The agreement of the parties, which is comprised
of this Agreement, the Exhibits and the Schedules hereto and the documents
referred to herein, sets forth the entire agreement and understanding between
the parties and supersedes any prior agreement or understanding, written or
oral, relating to the subject matter of this Agreement.

         7.4 Assignment; Binding Effect; Severability. This Agreement may not be
assigned by any party hereto, other than a successor entity to Subsidiary
Corporation, without the written consent of the other party. This Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
successors, legal representatives and permitted assigns of each party hereto.
The provisions of this Agreement are severable, and in the event that any one or
more provisions are deemed illegal or unenforceable, the remaining provisions
shall remain in full force and effect unless the deletion of such provision
shall cause this Agreement to become materially adverse to any party, in which
event the parties shall use Reasonable Efforts to arrive at an accommodation
which best preserves for the parties the benefits and obligations of the
offending provision.

         7.5 Governing Law. This Agreement shall be construed, interpreted and
the rights of the parties determined in accordance with the laws of the State of
Delaware and enforced in the County of New York in the State of New York. This
Agreement, or any Section thereof, shall not be construed against any part due
to the fact that said Agreement or any Section thereof was drafted by said
party.

         7.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

         7.7 Headings. The headings of the Articles and Sections herein are
inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.

         7.8 Amendment and Waiver. The parties may by mutual agreement amend
this Agreement in any respect, and any party, as to such party, may (a) extend
the time for the performance of any of the obligations of any other party, (b)
waive any inaccuracies in representations by any other party, (c) waive
compliance by any other party with any of the agreements contained herein and
performance of any obligations by such other party, and (d) waive the
fulfillment of any condition that is precedent to the performance by such party
of any of its obligations under this Agreement. To be effective, any such
amendment or waiver must be in writing and be signed by the party against whom
enforcement of the same is sought.

                                       8
<PAGE>

         7.9 Indemnification. Anything in this Agreement to the contrary
notwithstanding, Subsidiary Corporation shall not assume, and UHCP and NHSC
shall be jointly and severally responsible for the payment, performance and
discharge of, and shall indemnify Subsidiary Corporation and its affiliates and
successors and hold each of them harmless from and against any losses,
liabilities, claims, demands, judgements, expenses (including legal fees and
expenses), causes of action or suits, and obligations of NHSC, disclosed or
undisclosed, contingent or absolute, existing on the date hereof and through the
Closing, other than such costs or liabilities incurred after the Closing which
arise from or relate to any actions of Subsidiary Corporation. UHCP and NHSC
shall, jointly and severally, indemnify Subsidiary Corporation from any and all
successor liability claims that may be asserted or claimed by and current,
former or future creditor, claimant, vendor or otherwise of NHSC and/or UHCP
relating to any lawsuit, claim, loan, obligation, liability and/or indebtedness
whatsoever of NHSC and/or UHCP, including, but not necessarily limited to the
existing lawsuit styled Denise Everett v. National Heritage Sales Corp., Case
No. 03CC05406, Orange County Superior Court, Orange County, CA, filed on April
9, 2003.

                                       9
<PAGE>

                                 SIGNATURE PAGE

                                          Heritage Food Group, Inc.

                                             By: /s/ Walter G. Mize
                                                --------------------------------
                                           Name:     Walter G. Mize
                                          Title:     President

Attest:

  /s/  Walter G. Mize
-------------------------------
Name:  Walter G. Mize
Title: Secretary

                                          United Heritage Corporation

                                             By: /s/ Walter G. Mize
                                                --------------------------------
                                           Name:     Walter G. Mize
                                          Title:     President

Attest:

  /s/  Joe Martin
-------------------------------
Name:  Joe Martin
Title: Assistant Secretary

                                          National Heritage Sales Corp.

                                             By: /s/ Walter G. Mize
                                                -------------------------------
                                           Name:     Walter G. Mize
                                          Title:     President

Attest:

  /s/  Joe Martin
-------------------------------
Name:  Joe Martin
Title: Assistant Secretary

                                       10
<PAGE>

                                    Exhibit A
                               Transferred Assets

                                       11

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