Document:

SECURITY
      AGREEMENT, PLEDGE AND FINANCING STATEMENT

    

     

    This
      Security Agreement, Pledge and Financing Statement (this “Agreement”)
      is
      made and entered into June 16, 2006, effective as of March 31, 2006, by UNITED
      HERITAGE CORPORATION, a Utah corporation, and UHC NEW MEXICO CORPORATION, a
      New
      Mexico corporation (individually and collectively, the “Debtor”),
      in
      favor of Sterling Bank (the “Secured
      Party”).

     

    RECITALS

    

    WHEREAS,
      Debtor, Lothian Oil, Inc., Lothian Oil (USA) Inc., and Lothian Oil Texas I,
      Inc.
      (collectively, “Borrower”)
      executed and delivered to Secured Party that certain revolving promissory note
      dated as of even date herewith in the face amount of $20,000,000.00 (whether
      one
      or more and as the same may be amended, restated, rearranged or modified, the
      “Note”);
      and

     

    WHEREAS,
      the Note evidences a loan more particularly described in that certain Amended
      and Restated Credit Agreement dated as of even date herewith by and between
      Borrower and Secured Party as the same may be modified or amended, from time
      to
      time (the “Credit
      Agreement”);
      and

     

    WHEREAS,
      the Debtor has executed and delivered this Agreement pursuant to the Credit
      Agreement for the purpose of securing and providing for the repayment of all
      of
      its obligations to Secured Party under the Credit Agreement;

     

    NOW,
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, the Debtor and Secured Party hereby agree as
      follows:

     

    Section
      1.   Definitions.

     

    (a)  As
      used
      in this Agreement, the following terms shall have the respective meanings set
      forth below (such meanings to be equally applicable to both the singular and
      plural forms of the terms defined):

     

    “Collateral”
shall
      have the meaning assigned to that term in Section 2 of this
      Agreement.

     

    “Event
      of Default”
shall
      have the meaning assigned to that term in Section 6(a) of this
      Agreement.

     

    “Indebtedness”
means
      all amounts due or owing to Secured Party by the Debtor under the Credit
      Agreement.

     

    “Obligations”
means
      the Obligations defined in the Credit Agreement, including without limitation,
      the Indebtedness.

     

    “Permitted
      Liens”
has
      the
      meaning ascribed thereto in the Credit Agreement.

     

    “Security
      Documents”
shall
      have the meaning set forth in the Credit Agreement.

     

    “UCC”
means
      the Uniform Commercial Code as in effect in the State of Texas as of the date
      hereof.

     

    (b)  All
      terms
      used in this Agreement which are defined in the UCC, other than those which
      are
      specifically defined in Section l(a) above or under the Credit Agreement, shall
      have the same meaning herein as in the UCC.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    Section
      2.  Grant
      of Security Interest.

     

    The
      Debtor hereby grants to Secured Party, to secure the payment and performance
      in
      full of all of the Obligations, a security interest in and a lien on and so
      pledges and assigns to Secured Party all of the Debtor’s right, title and
      interest in, to and under the following properties, assets and rights, in each
      case, wherever located, all accessions and additions thereto, all substitutions
      and replacements therefor, and all proceeds and products thereof (all of the
      same being hereinafter called the “Collateral”):
      All
      improvements and all personal property of any kind or character defined in
      and
      subject to the provisions of the UCC, including the proceeds and products from
      any and all of such improvements and personal property, including, but not
      limited to, the improvements and personal property situated on, incident,
      appurtenant or belonging to and used in connection with, any of the Oil and
      Gas
      Properties as described in the other Security Instruments executed in connection
      with the Credit Agreement, a copy of such descriptions being attached hereto
      on
      Exhibit “A” and incorporated herein by reference, including, but not limited to,
      pipe, casing, tubing, rods, storage tanks, boilers, loading racks, pumps,
      foundations, warehouses, furniture, fixtures, equipment, raw materials,
      inventory, goods, contract rights, accounts receivable, receivables, rights
      to
      the payment of money, insurance refund claims and all other insurance claims
      and
      proceeds, deposit accounts, all tax refund claims, license fees, computer
      programs, computer software, engineering drawings, and all recorded data of
      any
      kind or nature, regardless of the medium of recording including, without
      limitation, all software, writings, plans, specifications and schematics, and
      all other personal property and equipment of every kind and
      character.

     

    Section
      3.  Representations
      and Warranties.
      The
      Debtor represents and warrants, as of the date hereof, to Secured Party as
      follows:

     

    (a) The
      chief
      executive office and principal place of business of the Debtor is located at
      405
      N. Marienfeld, Suite 200, Midland, Texas 79701. 

     

    (b) The
      Debtor is the owner of all of the Collateral free and clear of any lien,
      security interest, charge or encumbrance of any kind or nature, except as
      permitted under the Credit Agreement. Except as permitted under the Credit
      Agreement, all of the Collateral is free from any material credit, deduction,
      allowance, defense, dispute, setoff or counterclaim and there is no material
      extension or indulgence with respect thereto.

     

    (c) This
      Agreement has been duly executed and delivered by the Debtor and creates a
      valid
      security interest in, and lien on, the Collateral securing the payment of the
      Indebtedness. Upon the making of the filings and the taking of all other actions
      necessary to perfect the security interests created hereby, including, without
      limitation, those actions specified in Section 4, the security interests created
      by this Agreement will be duly perfected security interests, subject to no
      equal
      or prior lien, security interest or encumbrance of any kind or nature other
      than
      as permitted under the Credit Agreement.

     

    Section
      4.  Covenants.
      During
      the term of this Agreement and until all the obligations with respect to the
      Indebtedness have been fully and finally paid and discharged in full, the Debtor
      covenants and agrees with Secured Party that:

     

    (a)  Except
      in
      the ordinary coarse of business, the Debtor will not make any compromise or
      settlement with respect to any material portion of the Collateral without notice
      to and consent of Secured Party.

     

    (b)  From
      time
      to time, the Debtor shall, at its own expense, promptly give, execute, deliver,
      file and/or otherwise formalize any such notice, statement, instrument,
      document, agreement or other papers, and do all such other acts and things,
      as
      may be necessary or desirable, or as Secured Party may reasonably request,
      in
      order to create, evidence, preserve, perfect, validate or continue any lien
      or
      security interest created pursuant to this Agreement or to enable Secured Party
      to exercise or enforce its rights hereunder with respect to such lien or
      security interest, or otherwise further to effect the purposes of this
      Agreement. Without limiting the generality of the foregoing, the Debtor shall,
      at any time or from time to time upon the request of Secured Party and at the
      Debtor’s own expense, execute, acknowledge, witness, deliver, file and/or record
      such financing and continuation statements, notices, additional assignments
      and
      other documents or instruments (all of which shall be in form and substance
      satisfactory to Secured Party and its counsel) as Secured Party may from time
      to
      time reasonably request for the perfection of the liens and security interests
      created hereby.

     

    
      
         

      

      
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    (c)  The
      Debtor shall promptly notify Secured Party (i) of any material changes in any
      fact or circumstance represented or warranted by the Debtor with respect to
      any
      material portion of the Collateral, (ii) of any material impairment of the
      Collateral and (iii) of any claim, action or proceeding affecting title to
      all
      or any material portion of the Collateral.

     

    (d)  Except
      for the liens and security interests created by this Agreement and the Permitted
      Liens in the Collateral, the Debtor shall at its own expense defend the
      Collateral against any and all liens, claims, security interests and other
      encumbrances or interests, howsoever arising.

     

    (e)  The
      Debtor shall at all times keep accurate and complete records with respect to
      the
      Collateral, including, without limitation, records of all payments made, credit
      granted and proceeds received in connection therewith.

     

    (f)  The
      Debtor shall not relocate its principal place of business or chief executive
      office to a county or state other than that specified in Section 3(a) of this
      Agreement. The Collateral will be kept at Debtor’s principal place of business,
      its chief executive office or those locations listed on Exhibit “A” hereto, and
      the Debtor will not remove the Collateral from such locations.

     

    (g)  The
      Debtor will keep the Collateral in good condition, repair and working order
      (reasonable wear and tear excepted) and will not use the same in violation
      of
      law or any policy of insurance thereon. Secured Party, or its designee, may
      inspect the Collateral at any reasonable time, wherever located. The Debtor
      has
      at all times operated, and the Debtor will continue to operate, its business
      in
      compliance with all applicable provisions of the federal Fair Labor Standards
      Act, as amended and with all applicable provisions of federal, state and local
      statutes and ordinances dealing with the control, shipment, storage or disposal
      of hazardous materials or substances.

     

    Section
      5.  Powers
      of the Secured Party.

     

    (a)  The
      Debtor hereby irrevocably designates and appoints Secured Party as its
      attorney-in-fact, with full power of substitution, for the purposes of carrying
      out the provisions of this Agreement and taking any action and executing any
      instrument that Secured Party may reasonably request pursuant to this Agreement,
      which appointment as attorney-in-fact is irrevocable and coupled with an
      interest.

     

    (b)  Without
      limiting the generality of Section 5(a) hereof, the Debtor hereby irrevocably
      authorizes and empowers Secured Party, after the occurrence and during the
      continuance of any Event of Default, at the expense of the Debtor, either in
      Secured Party’s own name or in the name of the Debtor, at any time and from time
      to time:

     

    (i)  to
      ask,
      demand, receive, issue a receipt for, give acquittance for, settle and
      compromise any and all monies which may be or become due or payable or remain
      unpaid at any time or times to the Debtor, and any and all other property which
      may be or become deliverable at any time or times to the Debtor, under or with
      respect to the Collateral;

     

    
      
         

      

      
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    (ii)  to
      endorse any drafts, checks, orders or other instruments for the payment of
      money
      payable to the Debtor on account of the Collateral (including any such draft,
      check, order or instrument issued by any insurance company payable jointly
      to
      the Debtor and Secured Party); and

     

    (iii)  to
      settle, compromise, prosecute or defend any action, claim or proceeding, or
      take
      any other action, all either in its own name or in the name of the Debtor or
      otherwise, which Secured Party may deem to be necessary or advisable for the
      purpose of exercising and enforcing its powers and rights under this Agreement
      or in furtherance of the purposes hereof, including any action which by the
      terms of this Agreement is to be taken by the Debtor.

     

    (c)  Nothing
      in this Agreement shall be construed as requiring or obligating Secured Party
      to
      make any demand or to make any inquiry as to the nature or sufficiency of any
      payment received by it or to present or file any claim or notice, or to take
      any
      other action with respect to any of the Collateral or the amounts due or to
      become due under any thereof, or to collect or enforce the payment of any
      amounts assigned to it or to which it may otherwise be entitled hereunder at
      any
      time or times other than to account for amounts or Collateral
      received.

     

    (d)  Secured
      Party shall be entitled at any time to file this Agreement, or a carbon,
      photographic or any other reproduction of this Agreement, as a financing
      statement, but the failure of Secured Party to do so shall not impair the
      validity or enforceability of this Agreement. Secured Party shall have no duty
      to comply with any recording, filing or other legal requirements necessary
      to
      establish or maintain the validity, priority or enforceability of, or Secured
      Party’s rights in or to, any of the Collateral.

     

    (e)  In
      its
      discretion, Secured Party may discharge taxes and other encumbrances not timely
      paid by Debtor as provided in the Credit Agreement at any time levied or placed
      on any of the Collateral, make repairs thereto and pay any necessary filing
      fees. The Debtor agrees to reimburse Secured Party on demand for any and all
      reasonable expenditures so made with interest on unpaid amounts at the maximum
      rate permitted by law. Secured Party shall have no obligation to the Debtor
      to
      make any such expenditures, nor shall the making thereof relieve the Debtor
      of
      any Event of Default.

     

    (f)  Anything
      herein to the contrary notwithstanding, the Debtor shall remain liable under
      each contract or agreement comprised in the Collateral to be observed or
      performed by the Debtor thereunder. Secured Party shall not have any obligation
      or liability under any such contract or agreement by reason of or arising out
      of
      this Agreement or the receipt by Secured Party of any payment relating to any
      of
      the Collateral, nor shall Secured Party be obligated in any manner to perform
      any of the obligations of the Debtor under or pursuant to any such contract
      or
      agreement, to make inquiry as to the nature or sufficiency of any payment
      received by Secured Party in respect of the Collateral or as to the sufficiency
      of any performance by any party under any such contract or agreement, to present
      or file any claim, to take any action to or force any performance or to collect
      the payment of any amounts which may have been assigned to Secured Party or
      to
      which Secured Party may be entitled at any time or times other than to account
      for amounts or Collateral received. Secured Party’s sole duty with respect to
      the custody, safekeeping and physical preservation of the Collateral in its
      possession, under §9-207 of the UCC or otherwise, shall be to deal with such
      Collateral in the same manner as Secured Party deals with similar property
      for
      its own account.

     

    (g)  After
      the
      occurrence and during the continuance of an Event of Default, Secured Party
      may
      demand, sue for, collect, or make any settlement or compromise which it deems
      desirable with respect to the Collateral. After the occurrence of an Event
      of
      Default regardless of the adequacy of Collateral or any other security for
      the
      Indebtedness, any deposits or other sums at any time credited by or due from
      Secured Party to the Debtor may at any time be applied to or set off against
      any
      of the Indebtedness.

     

    
      
         

      

      
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    (h)  If
      an
      Event of Default shall have occurred and is continuing, the Debtor shall, at
      the
      request of Secured Party, notify obligors on chattel paper and general
      intangibles of the Debtor and obligors on instruments for which the Debtor
      is an
      obligee of the security interest of Secured Party in any chattel paper, general
      intangible or instrument and that payment thereof is to be made directly to
      Secured Party or to any financial institution designated by Secured Party as
      Secured Party’s agent therefor, and Secured Party may itself, if an Event of
      Default shall have occurred and is continuing, without notice to or demand
      upon
      the Debtor, so notify said obligors. After the making of such a request or
      the
      giving of any such notification, the Debtor shall hold any proceeds of
      collection of chattel paper, general intangibles and instruments received by
      the
      Debtor as trustee for Secured Party without commingling the same with other
      funds of the Debtor and shall turn the same over to Secured Party in the
      identical form received, together with any necessary endorsements or
      assignments. Secured Party shall apply the proceeds of collection of chattel
      paper, general intangibles and instruments received by Secured Party to the
      Indebtedness, such proceeds to be immediately entered after final payment in
      cash of the items giving rise to them.

     

    Section
      6.  Default.

     

    (a)  It
      shall
      constitute an Event of Default under this Agreement if an “Event of Default”
shall occur under the Credit Agreement, any Guarantor defaults under the
      Guaranty (as defined in the Credit Agreement) or if Debtor shall default in
      any
      of its obligations under this Agreement.

     

    (b)  If
      an
      Event of Default shall have occurred, in addition to any other rights and
      remedies that may be available to Secured Party under the UCC or under Section
      5(a) or 5(b) of this Agreement or otherwise under this Agreement or at law,
      Secured Party shall also have the following rights and powers:

     

    (i)  Secured
      Party may, without being required to give any notice except as hereinafter
      provided, sell the Collateral, or any part thereof, at public or private sale,
      for cash, upon credit or for future delivery and at such price or prices as
      Secured Party deems satisfactory, and Secured Party and/or its collateral agent
      may be the purchaser of any or all of the Collateral so sold and thereafter
      hold
      the same absolutely free from any right or claim of whatsoever kind, and the
      Indebtedness or any portion of the Indebtedness may be applied as a credit
      against the purchase price.

     

    (ii)  upon
      any
      such sale, Secured Party shall have the right to deliver, assign and transfer
      to
      the purchaser thereof the Collateral so sold. Each purchaser at any such sale
      shall hold the property sold absolutely free from any claim or right of
      whatsoever kind by or on behalf of the Debtor, including any equity or rights
      of
      redemption of the Debtor and the Debtor hereby specifically waives, to the
      extent permitted by applicable law, all rights of redemption, stay or appraisal
      which it has or may have under any rule or law or statute now existing or
      hereafter adopted.

     

    (iii)  Secured
      Party shall give the Debtor five (5) business days’ written notice (which the
      Debtor agrees is reasonable notification within the meaning of §9.611 of the
      UCC) of its intention to make any such public or private sale. Such notice,
      in
      case of a public sale, shall state the time and place fixed for such sale and,
      in case of a private sale, shall state the date after which such sale is to
      be
      made.

     

    
      
         

      

      
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    (iv)  any
      such
      public sale shall be held at such time or times within ordinary business hours
      and at such places as Secured Party may fix in the notices of such sale. At
      any
      such sale the Collateral may be sold in one lot as an entirety or in separate
      parcels, as Secured Party may determine.

     

    (v)  Secured
      Party shall not be obligated to make any sale pursuant to any such notice.
      Secured Party may, without notice or publication, adjourn any public or private
      sale or cause the same to be adjourned from time to time by announcement at
      the
      time and place fixed for the sale, and such sale may be made at any time or
      place to which the same shall be so adjourned.

     

    (vi)  in
      case
      of any sale of all or any part of the Collateral on credit or for future
      delivery, the Collateral so sold may be retained by Secured Party until the
      selling price is paid by the purchaser thereof, but Secured Party shall not
      incur any liability in case of the failure of such purchaser to take up and
      pay
      for the Collateral so sold and, in case of any such failure, such Collateral
      may
      again be sold upon like notice.

     

    (vii)  Secured
      Party instead of exercising the power of sale herein conferred upon it, may
      proceed by a suit or suits at law or in equity to foreclose the liens and
      security interests granted in this Agreement and sell the Collateral, or any
      portion thereof, under a judgment or decree of a court or courts of competent
      jurisdiction.

     

    (viii)  Secured
      Party shall have the right to take possession of the Collateral, and for that
      purpose Secured Party may, so far as the Debtor can give authority therefor,
      enter upon any premises on which the Collateral may be situated and remove
      the
      same therefrom. The Debtor waives any and all rights that it may have to a
      judicial hearing in advance of the enforcement of any of Secured Party’s rights
      hereunder, including, without limitation, its right following an Event of
      Default to take immediate possession of the Collateral and to exercise its
      rights with respect thereto. To the extent that any of the Indebtedness is
      to be
      paid or performed by a person other than the Debtor, the Debtor waives and
      agrees not to assert any rights or privileges which it may have under the
      UCC.

     

    (c)  Secured
      Party shall incur no liability as a result of the sale of the Collateral, or
      any
      part thereof, at any private sale other than for its own gross negligence,
      willful misconduct or bad faith. The Debtor hereby waives, to the maximum extent
      permitted by applicable law, any claims against Secured Party arising by reason
      of the fact that the price at which the Collateral may have been sold at such
      private sale was less than the price which might have been obtained at a public
      sale or was less than the aggregate amount of the Indebtedness, even if Secured
      Party accepts the first offer received and does not offer such Collateral to
      more than one offeree.

     

    (d)  Secured
      Party shall not be obligated to pursue or exhaust its rights and remedies
      against any particular Collateral or other security for the Indebtedness before
      pursuing or enforcing its rights and remedies against any other Collateral
      or
      other security for the Indebtedness.

     

    (e)  To
      the
      extent permitted by law, the Debtor hereby waives (i) any rights to require
      Secured Party to proceed first against any other Person, to exhaust its rights
      in the Collateral or other security for the Indebtedness or to pursue any other
      right that Secured Party might have, and (ii) all rights of marshalling in
      respect of any and all of the Collateral.

     

    (f)  Without
      precluding any other methods of sale, the Debtor acknowledges that the sale
      of
      the Collateral shall have been made in a commercially reasonable manner if
      conducted in conformity with reasonable commercial practices of banks disposing
      of similar property. Secured Party shall not be liable for any depreciation
      in
      the value of the Collateral.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

     

    (g)  Remedies
      of Secured Party are cumulative and the exercise of any one or more of the
      remedies provided herein shall not be construed as a waiver of any of the other
      remedies of Secured Party.

     

    (h)  If
      an
      Event of Default shall have occurred, the proceeds of any sale of or other
      realization upon all or any part of the Collateral and any other amounts held
      by
      Secured Party under this Agreement shall be applied by Secured Party as provided
      in the Credit Agreement.

     

    Any
      amounts remaining after such applications shall be remitted to the Debtor,
      its
      successors or assigns, or as a court of competent jurisdiction may otherwise
      direct.

     

    Section
      7.  General
      Provisions.

     

    (a)  This
      Agreement shall remain in full force and effect until all of the Indebtedness
      shall have been satisfied in full.

     

    (b)  The
      lien
      and security interest created hereunder and the Debtor’s obligations hereunder
      and Secured Party’s rights hereunder shall not be released, diminished, impaired
      or adversely affected by the occurrence of any one or more of the following
      events:

     

    (i)  the
      taking or accepting of any other security or assurance for any or all of the
      Indebtedness;

     

    (ii)  any
      release, surrender, exchange, subordination or loss of any security or assurance
      at any time existing in connection with any or all of the
      Indebtedness;

     

    (iii)  the
      modification of, amendment to, or waiver of compliance with any terms of the
      Credit Agreement;

     

    (iv)  any
      renewal, extension and/or rearrangement of the payment of any or all of the
      Indebtedness or any statement, indulgence, forbearance or compromise that may
      be
      granted or given by Secured Party to the Debtor or any other
      Person;

     

    (v)  any
      neglect, delay, omission, failure or refusal of Secured Party to take or
      prosecute any action in connection with any agreement, document or other
      instrument evidencing, securing or assuring the payment of any or all of the
      Indebtedness; or

     

    (vi)  the
      illegality, invalidity or unenforceability of all or any part of the
      Indebtedness.

     

    (c)  This
      Agreement or any term hereof may be amended or changed only by an instrument
      in
      writing executed jointly by the Debtor and Secured Party.

     

    (d)  Each
      right, power and remedy herein specifically granted to Secured Party or
      otherwise available to it shall be cumulative, and shall be in addition to
      every
      other right, power and remedy herein specifically given or now or hereafter
      existing at law, in equity, or otherwise (including, without limitation, all
      rights, powers and remedies granted to a secured party under the UCC), and
      each
      such right, power and remedy, whether specifically granted herein or otherwise
      existing, may be exercised at any time and from time to time as often and in
      such order as may be deemed expedient by Secured Party in its sole and complete
      discretion. The provisions of this Agreement may only be waived by an instrument
      in writing signed by Secured Party, and no failure on the part of Secured Party
      to exercise, and no delay in exercising, and no course of dealing with respect
      to, any such right, power or remedy, shall operate as a waiver thereof, nor
      shall any single or partial exercise of any such right, power or remedy preclude
      any other or further exercise thereof or the exercise of any other
      right.

     

    
      
         

      

      
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    (e)  The
      manner and place of service of all notices, requests, demands or other
      communications to be sent hereunder shall be sent as set forth in Section 8.3
      of
      the Credit Agreement.

     

    (f)  This
      Agreement shall be binding upon the Debtor and its successors and assigns and
      shall inure to the benefit of Secured Party and its successors and assigns.
      The
      Debtor may not, without the prior written consent of Secured Party, assign
      any
      of its rights, duties or obligations hereunder.

     

    (g)  This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Texas.

     

    (h)  The
      descriptive headings of the several sections of this Agreement are inserted
      for
      convenience only and shall not control or affect the meaning or construction
      of
      any of the provisions hereof.

     

    (i)  Any
      provision of this Agreement that is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions hereof or affecting the validity of enforceability or such provision
      in any other jurisdiction.

     

    (j)  This
      Agreement may be executed in any number of counterparts and by different parties
      in separate counterparts, each of which when so executed and delivered shall
      be
      deemed to be an original, but all of which when taken together shall constitute
      one and the same instrument.

     

    (k)  In
      the
      event of any conflict or inconsistency between the terms, covenants, conditions
      and provisions set forth in this Agreement and the terms, covenants, conditions
      and provisions set forth in the Credit Agreement, the terms, covenants,
      conditions and provisions of the Credit Agreement shall prevail.

     

    [signature
      page follows]

     

    
      
         

      

      
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    IN
      WITNESS WHEREOF, the Debtor and Secured Party have executed this Agreement
      as of
      the date first above written.

     

    
      	 	 	 
	 	“Debtor”
	 	 
	 	UNITED
              HERITAGE CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ C.
              Scott
              Wilson
	 	
              
C.
              Scott Wilson,
	 	Chief
              Executive Officer and President

    

     

    
       

      
        	 	 	 
	 	UHC
                NEW
                MEXICO CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ C.
                Scott
                Wilson
	 	
                
C.
                Scott Wilson,
	 	Chief
                Executive Officer and President

      

       

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
        	 	 	 
	 	“Secured Party”
	 	 
	 	STERLING
                BANK
	 
 	 
 	 
 
	 	By:  	/s/ Daniel
                G.
                Steele
	 	
                
Daniel
                G. Steele,
	 	Senior
                Vice President

      

       

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    EXHIBIT
      “A”

     

    
      
         

      

      
        A-1GUARANTY

     

    

    

    THIS
      GUARANTY (as amended, restated, or supplemented, this “Guaranty”)
      is
      executed June 16, 2006, effective as of March 31, 2006, by the undersigned
      (jointly and severally, “Guarantor”
and
      collectively, the “Guarantors”),
      for
      the benefit of Sterling Bank (the “Lender”).

     

    RECITALS

     

    A.  Lothian
      Oil Inc., a Delaware corporation, Lothian Oil (USA) Inc., a Texas corporation,
      Lothian Oil Texas I, Inc., a Texas corporation, United Heritage
      Corporation, a Utah corporation and UHC New Mexico Corporation, a New Mexico
      corporation (each individually, a “Borrower”
and
      collectively, the “Borrowers”)
      and
      Lender have entered into the Amended and Restated Credit Agreement dated as
      of
      even date herewith (as amended, restated, or supplemented, from time to time
      the
“Credit
      Agreement”),
      together with certain other Loan Documents.

     

    B.  Guarantors
      expect to continue to receive business opportunities and financial benefit
      from
      Borrowers. Guarantors have agreed to enter into this Guaranty so that Borrowers
      can receive the benefits of the Credit Agreement.

     

    C.  In
      addition, Guarantors may benefit from Borrowers’ execution of the Credit
      Agreement as Guarantors may be the indirect recipient of funds advanced by
      Lender to Borrowers under the Credit Agreement.

     

    D.  It
      is
      expressly understood among Borrowers, Guarantors, and Lender that the execution
      and delivery of this Guaranty is a condition precedent to Lender’s obligations
      to extend credit under the Credit Agreement.

     

    E.  In
      each
      Guarantor’s judgment, the value of the consideration received and to be received
      by it under the Loan Documents is reasonably worth at least as much as its
      liability and obligation under this Guaranty, and such liability and obligation
      may reasonably be expected to benefit Guarantors directly or
      indirectly.

     

    NOW,
      THEREFORE, for valuable consideration, the receipt and adequacy of which are
      hereby acknowledged, Guarantors guarantee to Lender the prompt payment of the
      Guaranteed Obligation when due and at all times thereafter, as
      follows:

     

    1.  Definitions.
      Each
      capitalized term used but not defined in this Guaranty shall have the meaning
      given that term in the Credit Agreement. The following terms shall have the
      following meanings as used in this Guaranty:

     

    Borrower
      and
Borrowers
      have the
      meanings given in Recital A and includes, without limitation, all of Borrower’s
      successors and assigns, each Borrower as a debtor-in-possession, and any
      receiver, trustee, liquidator, conservator, custodian, or similar party
      hereafter appointed for such Borrower or for all or any portion of each
      Borrower’s assets pursuant to any liquidation, conservatorship, bankruptcy,
      moratorium, rearrangement, receivership, insolvency, reorganization, or similar
      Debtor Relief Law from time to time in effect.

     

    Company
      Indebtedness
      means
      all obligations of the Borrowers or any of their Subsidiaries to Guarantor,
      whether direct, indirect, fixed, contingent, liquidated, unliquidated, joint,
      several, or joint and several, now existing or arising after the date of this
      Guaranty, due or to become due to any Guarantor, or held or to be held by any
      Guarantor, whether created directly or acquired by assignment or otherwise,
      and
      whether or not evidenced by written instrument including the obligation of
      Borrowers to any Guarantor as a subrogee of Lender or resulting from any
      Guarantor’s performance under this Guaranty.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    Debtor
      Relief Laws
      means
      the Bankruptcy Code of the United States, and all other liquidation,
      conservatorship, bankruptcy, assignment for the benefit of creditors,
      moratorium, rearrangement, receivership, insolvency, reorganization, or similar
      debtor relief laws of the United States or other applicable jurisdictions from
      time to time in effect and affecting the rights of creditors
      generally.

     

    Guaranteed
      Obligation
      (a) Any
      and all indebtedness, obligations (including reimbursement obligations) and
      liabilities of Borrowers to Lender now existing or hereafter incurred in
      connection with or incident to the Loan(s), under or arising out of or in
      connection with any documents executed in connection with any indebtedness
      of
      Borrowers to Lender in connection with the Loan or any promissory note or notes
      executed by any Borrower at any time in connection with the Loan(s), whether
      for
      principal, interest, penalty interest, fees, expenses or otherwise, including,
      without limitation, all sums, principal, accrued interest and other amounts
      owing with respect to the Note, together with any and all renewals, extensions
      and/or rearrangements thereof, whether with or without notice to any Guarantor;
      (b) all interest, charges, expenses, attorneys’ or other fees and any other sums
      payable to or incurred by the Lender, to the extent reasonable, in connection
      with the execution, administration or enforcement of the Lender’s rights and
      remedies under the Note; and (c) all post-petition interest on the Guaranteed
      Obligation in the event of a bankruptcy or insolvency of any
      Borrower.

     

    Lien
      means
      any mortgage, pledge, hypothecation, assignment, deposit arrangement,
      encumbrance, lien (statutory or other), charge, or preference, priority or
      other
      security interest or preferential arrangement of any kind or nature whatsoever
      (including any conditional sale or other title retention agreement, and any
      financing lease having substantially the same economic effect as any of the
      foregoing.

     

    Loan
      means
      any
      advance by Lender to or for the benefit of the Borrowers pursuant to the Credit
      Agreement.

     

    Paid
      in Full
      or
Payment
      in Full means
      that the Guaranteed Obligation is completely paid (including principal,
      interest, fees and expenses). 

     

    2.  Guaranty.
      Each
      Guarantor hereby guarantees prompt payment and performance of the Guaranteed
      Obligation at all times. This is an absolute, unconditional irrevocable and
      continuing guaranty of payment (and not of collection) of the Guaranteed
      Obligation which will remain in effect until (a) the Guaranteed Obligation
      is
      Paid in Full, and (b) the Lender’s commitments to extend credit under the Credit
      Agreement have terminated, and (c) the Obligations under and as defined in
      the
      Credit Agreement have been paid in full and fully performed. The circumstance
      that at any time or from time to time all or any portion of the Guaranteed
      Obligation may be paid in full shall not affect any Guarantor’s obligation with
      respect to the Guaranteed Obligation thereafter incurred. No Guarantor may
      rescind or revoke its obligations to Lender under this Guaranty with respect
      to
      the Guaranteed Obligation. At the Lender’s option, all payments under this
      Guaranty shall be made to the office of Lender located in the United States
      and
      in U.S. Dollars.

     

    
      
         

      

      
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    3.  Financial
      Information.
      Guarantors agree to furnish promptly to Lender any and all financial or other
      information regarding Guarantor or its property as Lender may reasonably request
      in writing.

     

    4.  Default
      by Borrower.
      If an
      Event of Default exists, Guarantors shall pay the amount of the Guaranteed
      Obligation then due and payable to Lender on demand and without (a) further
      notice of dishonor, to any Guarantor, (b) any prior notice to any Guarantor
      of
      the acceptance by Lender of this Guaranty, (c) any notice having been given
      to
      Guarantors prior to such demand of the creating or incurring of such
      Indebtedness, or (d) notice of intent to accelerate or notice of acceleration
      to
      any Guarantor or any Borrower. To enforce such payment by any Guarantor it
      shall
      not be necessary for Lender to first or contemporaneously institute suit or
      exhaust remedies against any Borrower or others liable on such Indebtedness,
      or
      to enforce rights against any security or collateral ever given to secure such
      Indebtedness.

     

    5.  Amount
      of Guaranty and Consideration.
      The
      Lender’s books and records showing the amount of the Guaranteed Obligation shall
      be admissible in evidence in any action or proceeding, and shall be binding
      upon
      the Guarantors and conclusive for the purpose of establishing the amount of
      the
      Guaranteed Obligation. In consummating the transactions contemplated by the
      Credit Agreement, Guarantors do not intend to disturb, delay, hinder, or defraud
      either its present or future creditors. Guarantors are familiar with, and have
      independently reviewed books and records regarding, the financial condition
      of
      Borrowers and are familiar with the value of the security and support for the
      payment and performance of the Guaranteed Obligation. Based upon such
      examination, and taking into account the fairly discounted value of Guarantors’
contingent obligations under this Guaranty and the value of the subrogation
      and
      contribution claims Guarantors could make in connection with this Guaranty,
      and
      assuming each of the transactions contemplated by the Credit Agreement is
      consummated and Borrowers make full use of the credit facilities thereunder,
      the
      present realizable fair market value of the assets of each Guarantor exceeds
      the
      total obligations of each such Guarantor, and each Guarantor is able to realize
      upon its assets and pay its obligations as such obligations mature in the normal
      course of business. Each Guarantor represents and warrants to Lender that the
      value of consideration received and to be received by it is reasonably worth
      at
      least as much as its liability under this Guaranty, and such liability may
      reasonably be expected to benefit each Guarantor, directly or
      indirectly.

     

    6.  Liability
      for Other Indebtedness of Borrower.
      If
      either Guarantor becomes liable for any Indebtedness owing by any Borrower
      to
      Lender, by endorsement or otherwise, other than under this Guaranty, such
      liability shall not be impaired or affected by this Guaranty and the rights
      of
      Lender under this Guaranty shall be cumulative of any and all other rights
      that
      Lender may ever have against either Guarantor. 

     

    7.  Subordination.
      Guarantors hereby expressly subordinate all Company Indebtedness to the Payment
      in Full of the Guaranteed Obligation. Guarantors agree not to receive or accept
      any payment from any Borrower or any of its Subsidiaries with
      respect to the Company Indebtedness at any time an Event of Default exists
      and,
      in the event any Guarantor receives any payment on the Company Indebtedness
      in
      violation of the foregoing, such Guarantor shall hold any such payment for
      the
      benefit of Lender and promptly turn it over to Lender, in the form received
      (with any necessary endorsements), to be applied to the Guaranteed Obligation.
      If Lender so requests, any such Company Indebtedness shall be enforced and
      all
      amounts received by any Guarantor shall be received in trust for the Lender
      and
      the proceeds thereof shall be paid over to the Lender on account of the
      Guaranteed Obligation, but without reducing or affecting in any manner the
      liability of Guarantor under this Guaranty.

     

    8.  Subrogation.
      Until
      the Guaranteed Obligation is Paid In Full, Guarantors agree that they will
      not
      assert, enforce, or otherwise exercise (a) any right of subrogation to any
      of
      the rights or liens of Lender or any other beneficiary against any Borrower
      or
      any other obligor on the Guaranteed Obligation or any Collateral or other
      security, or (b) any right of recourse, reimbursement, subrogation,
      contribution, indemnification, or similar right against any Borrower or any
      other obligor or other guarantor on all or any part of the Guaranteed Obligation
      (whether such rights in clause (a)
      or
clause
      (b)
      arise in
      equity, under contract, by statute, under common law, or
      otherwise).

     

    
      
         

      

      
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    9.  Enforceability
      of Guaranty; No Release.
      

     

    (a)  This
      Guaranty shall not be affected by the genuineness, validity, regularity or
      enforceability of the Guaranteed Obligation or any instrument or agreement
      evidencing any part of the Guaranteed Obligation, or by the existence, validity,
      enforceability, perfection, or extent of any collateral securing the Guaranteed
      Obligation, or by any fact or circumstance relating to the Guaranteed Obligation
      which might otherwise constitute a defense to the obligations of any Guarantor
      under this Guaranty. 

     

    (b)  Guarantors
      agree that the Lender may, at any time and from time to time, and without notice
      to the Guarantors, make any agreement with any Borrower or with any other Person
      liable on any of the Guaranteed Obligations or providing collateral as security
      for the Guaranteed Obligations, for the extension, renewal, payment, compromise,
      discharge or release of the Guaranteed Obligations or any collateral (in whole
      or in part), or for any modification or amendment of the terms thereof or of
      any
      instrument or agreement evidencing the Guaranteed Obligations or the provision
      of collateral, all without in any way impairing, releasing, discharging or
      otherwise affecting the obligations of any Guarantor under this
      Guaranty.

     

    (c)  Each
      Guarantor hereby agrees its obligations under the terms of this Guaranty shall
      not be released, discharged, diminished, impaired, reduced or otherwise
      adversely affected by any of the following:
      (i)
      Lender’s
      taking or accepting of any other security or guaranty for any or all of the
      Guaranteed Obligation;
      (ii)
any
      release, surrender, exchange, subordination or loss of any security at any
      time
      existing in connection with any or all of the Guaranteed Obligation;
      (iii)
      any full
      or partial release of the liability of any other obligor on the Guaranteed
      Obligation;
      (iv)
      the
      insolvency, becoming subject to any Debtor Relief Law, or lack of corporate
      power of any Borrower, or any party at any time liable for the payment of any
      or
      all of the Guaranteed Obligation; (v)
      any
      renewal, extension or rearrangement of the payment of any or all of the
      Guaranteed Obligation, either with or without notice to or consent of any
      Guarantor, or any adjustment, indulgence, forbearance, or compromise that may
      be
      granted or given by Lender to any Borrower, any Guarantor, or any other obligor
      on the Guaranteed Obligation;
      (vi)
      any
      neglect, delay, omission, failure or refusal of Lender to take or prosecute
      any
      action for the collection of all or any part of the Guaranteed Obligation or
      to
      foreclose or take or prosecute any action in connection with any instrument
      or
      agreement evidencing or securing any or all of the Guaranteed
      Obligation;
      (vii)
      any
      failure of Lender to give any Guarantor notice of any of the foregoing it being
      understood that Lender shall not be required to give any Guarantor any notice
      of
      any kind under any circumstances with respect to or in connection with the
      Guaranteed Obligation, other than any notice expressly required to be given
      to a
      Guarantor under this Guaranty;
      (viii)
      the
      unenforceability of all or any part of the Guaranteed Obligation against any
      Borrowers by reason of the fact that the Guaranteed Obligation (or the interest
      on the Guaranteed Obligation) exceeds the amount permitted by Law, the act
      of
      creating the Guaranteed Obligation, or any part thereof, is ultra
      vires,
      or the
      officers creating same exceeded their authority or violated their fiduciary
      duties in connection therewith;
      (ix)
      any
      payment of the Guaranteed Obligation to Lender is held to constitute a
      preference under any Debtor Relief Law or if for any other reason Lender is
      required to refund such payment or make payment to someone else (and in each
      such instance this Guaranty shall be reinstated in an amount equal to such
      payment); or
      (x)
any
      discharge, release, or other forgiveness of any Borrower’s liability for the
      payment of the Guaranteed Obligation.

     

    
      
         

      

      
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    10.  Exercise
      of Rights and Waiver.
      

     

    (a)  No
      failure by Lender to exercise, and no delay in exercising, any right or remedy
      under this Guaranty shall operate as a waiver thereof. The exercise by Lender
      of
      any right or remedy under this Guaranty under the Loan Documents, or other
      instrument, or at Law or in equity, shall not preclude the concurrent or
      subsequent exercise of any other right or remedy. The remedies provided in
      this
      Guaranty are cumulative and not exclusive of any remedies provided by law or
      in
      equity. The unenforceability or invalidity of any provision of this Guaranty
      shall not affect the enforceability or validity of any other provision
      herein.

     

    (b)  The
      obligations of Guarantors under this Guaranty are those of primary obligor,
      and
      not merely as surety, and are independent of the Guaranteed Obligation. Each
      Guarantor waives diligence by Lender and action on delinquency in respect of
      the
      Guaranteed Obligation or any part thereof, including any provisions of laws
      requiring Lender to exhaust any right or remedy or to take any action against
      any Borrower any other guarantor or any other Person before enforcing this
      Guaranty against any Guarantor. Each Guarantor hereby waives all rights by
      which
      it might be entitled to require suit on an accrued right of action in respect
      of
      any of the Guaranteed Obligation or require suit against any Borrower, the
      other
      Guarantor or others, whether arising pursuant to Section 34.02 of the Texas
      Business and Commerce Code, as amended (regarding a Guarantor’s right to require
      Lender to sue any Borrower on accrued right of action following Guarantors’
written notice to Lender), Section 17.001 of the Texas Civil Practice and
      Remedies Code, as amended (allowing suit against Guarantor without suit against
      any Borrower, but precluding entry of judgment against a Guarantor prior to
      entry of judgment against any Borrower), Rule 31 of the Texas Rules of Civil
      Procedure, as amended (requiring Lender to join any Borrower in any suit against
      Guarantor unless judgment has been previously entered against any Borrower),
      or
      otherwise. 

     

    (c)  Each
      Guarantor waives notice of acceptance of this Guaranty, notice of any loan
      to
      which it may apply, and waives presentment, demand for payment, protest, notice
      of dishonor or nonpayment of any loan, notice of intent to accelerate, notice
      of
      acceleration, and notice of any suit or notice of the taking of other action
      by
      Lender against any Borrower, any Guarantor or any other Person and any notice
      to
      any party liable thereon (including such Guarantor).

     

    11.  Stay
      of Acceleration.
      In the
      event that acceleration of the time for payment of any of the Guaranteed
      Obligation is stayed, upon the insolvency, bankruptcy or reorganization of
      any
      Borrower or any other Person, or otherwise, all such amounts shall nonetheless
      be payable, jointly and severally, by Guarantors immediately upon demand by
      Lender. 

     

    12.  Expenses.
      Guarantors shall pay on demand all out-of-pocket expenses (including attorneys’
costs) in any way relating to the enforcement or protection of the Lender’s
      rights under this Guaranty, including any incurred in the preservation,
      protection or enforcement of any rights of the Lender in any case commenced
      by
      or against Guarantor under Title 11, United States Code or any similar or
      successor statute. The obligations of the Guarantor under the preceding sentence
      shall survive termination of this Guaranty.

     

    13.  Amendments.
      No
      provision of this Guaranty may be waived, amended, supplemented or modified,
      except by a written instrument executed by Lender and Guarantors.

     

    
      
         

      

      
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    14.  Reliance
      and Duty to Remain Informed.
      Each
      Guarantor confirms that it has executed and delivered this Guaranty after
      reviewing the terms and conditions of the Credit Agreement and the other Loan
      Documents and such other information as it has deemed appropriate in order
      to
      make its own credit analysis and decision to execute and deliver this Guaranty.
      Each Guarantor confirms that it has made its own independent investigation
      with
      respect to Borrowers’ creditworthiness and is not executing and delivering this
      Guaranty in reliance on any representation or warranty by Lender as to such
      creditworthiness. Guarantors expressly assume all responsibilities to remain
      informed of the financial condition of Borrowers and any circumstances affecting
      (a) Borrowers’ ability to perform under the Loan Documents to which Borrowers
      are parties or (b) any collateral securing all or any part of the Guaranteed
      Obligation. 

     

    15.  Change
      in Guarantor’s Status.
      Should
      any Guarantor become insolvent, or fail to pay its debts generally as they
      become due, or voluntarily seek, consent to, or acquiesce in the benefit or
      benefits of any Debtor Relief Law or become a party to (or be made the subject
      of) any proceeding provided for by any Debtor Relief Law (other than as a
      creditor or claimant) that could suspend or otherwise adversely affect the
      rights of the Lender granted under this Guaranty, then, in any such event,
      the
      Guaranteed Obligation shall be, as between Guarantors and Lender, a fully
      matured, due, and payable obligation of Guarantors, jointly and severally,
      to
      Lender (without regard to whether any Borrower is then in default or whether
      the
      Guaranteed Obligation, or any part thereof is then due and owing by Borrowers
      to
      Lender), payable, jointly and severally, in full by Guarantors to Lender upon
      demand, which shall be the estimated amount owing in respect of the contingent
      claim created under this Guaranty. 

     

    16.  Representations
      and Warranties.
      Each
      Guarantor acknowledges that certain representations and warranties set out
      in
      the Credit Agreement are in respect of it, and Guarantor reaffirms that each
      such representation and warranty is true and correct. 

     

    17.  Covenants.
      Each
      Guarantor acknowledges that certain covenants set forth in the Credit Agreement
      are in respect of it or shall be imposed upon it, and each Guarantor covenants
      and agrees to promptly and properly perform, observe, and comply with each
      such
      covenant. 

     

    18.  Offset
      Claims.
      The
      Guaranteed Obligation shall not be reduced, discharged or released because
      or by
      reason of any existing or future offset, claim or defense (except for the
      defense of Payment in Full of the Guaranteed Obligation) of any Borrower or
      any
      other party against Lender or against payment of the Guaranteed Obligation,
      whether such offset, claim, or defense arises in connection with the Guaranteed
      Obligation or otherwise. Such claims and defenses include, without limitation,
      failure of consideration, breach of warranty, fraud, statute of frauds,
      bankruptcy, infancy, statute of limitations, lender liability, accord and
      satisfaction, and usury.

     

    19.  Setoff.
      If and
      to the extent any payment is not made when due under this Guaranty, Lender
      may
      setoff and charge from time to time any amounts so due against any or all of
      any
      Guarantor’s accounts or deposits with any Lender.

     

    20.  Binding
      Agreement.
      This
      Guaranty is for the benefit of Lender and respective successors and assigns.
      Each Guarantor acknowledges that in the event of an assignment of the Guaranteed
      Obligation or any part thereof in accordance with the Credit Agreement, the
      rights and benefits under this Guaranty, to the extent applicable to the
      Indebtedness so assigned, may be transferred with such Indebtedness. This
      Guaranty is binding on each Guarantor and its successors and permitted assigns,
      provided
      that Guarantor
      may not assign its rights or obligations under this Guaranty without the prior
      written consent and Lender (and any attempted assignment without such consent
      shall be void).

     

    
      
         

      

      
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    21.  Notices.
      All
      notices required or permitted to be given under this Guaranty, if any, must
      be
      in writing and shall or may, as the case may be, be given in the same manner
      as
      notice is given under the Credit Agreement as follows:

     

    If
      to
      Lender:

     

    Sterling
      Bank

    2550
      North Loop West, Suite 800

    Houston,
      Texas 77092

    Telephone
      No.: (713) 507-7918

    Facsimile
      No.: (713) 507-7948

    E-mail:
       daniel.steele@banksterling.com

    Attn:
      Daniel G. Steele

     

    with
      a
      copy to:

     

    Porter
      & Hedges, L.L.P.

    1000
      Main, 36th Floor

    Houston,
      Texas 77002

    Telephone
      No.: (713) 226-6660

    Facsimile
      No.: (713) 226-6260

    E-mail: edelpozo@porterhedges.com
      

    Attention:
      Ephraim del Pozo 

     

    If
      to
      Borrower:

     

    Lothian
      Oil Inc.

    405
      N.
      Marienfeld, Suite 200

    Midland,
      TX 79701

    Facsimile
      No.: (432) 686-2644

    E-mail:
      swilson@lothian.us

    Attention:
      C. Scott Wilson 

     

    If
      to
      Guarantor:

     

    Lothian
      Oil Texas II, Inc.

    405
      N.
      Marienfeld, Suite 200

    Midland,
      TX 79701

    Facsimile
      No.: (432) 686-2644

    E-mail:
      swilson@lothian.us

    Attention:
      C. Scott Wilson 

     

    Subject
      to the terms of the Credit Agreement, by giving at least 30 days written notice,
      any party to this Guaranty shall have the right from time to time and at any
      time while this Guaranty is in effect to change their respective addresses
      or
      fax numbers and each shall have the right to specify a different address or
      fax
      number within the United States of America. Nothing in this Section shall be
      construed to require any notice to any Guarantor not otherwise expressly
      required in this Guaranty.

     

    
      
         

      

      
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    22.  Reinstatement
      and Termination.
      

     

    (a)  Notwithstanding
      anything in this Guaranty to the contrary, this Guaranty shall continue to
      be
      effective or be reinstated, as the case may be, if at any time any payment
      of
      any portion of the Guaranteed Obligations is revoked, terminated, rescinded
      or
      reduced or must otherwise be restored or returned upon the insolvency,
      bankruptcy or reorganization of any Borrower or any other Person or otherwise,
      as if such payment had not been made and whether or not the Lender is in
      possession of or has released this Guaranty and regardless of any prior
      revocation, rescission, termination or reduction. 

     

    (b)  Subject
      to clause (a) regarding reinstatement, this Guaranty shall terminate and be
      released on the date the Guaranteed Obligation is Paid In Full, the Obligation
      under the Credit Agreement has been paid in full, and the Lender’s obligations
      to extend credit under the Credit Agreement have terminated. 

     

    23.  Governing
      Law.
      THIS
      GUARANTY IS TO BE CONSTRUED — AND ITS PERFORMANCE ENFORCED — UNDER TEXAS
      LAW.

     

    24.  No
      Oral Agreements.
      THE
      RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE DETERMINED SOLELY FROM
      WRITTEN AGREEMENTS, DOCUMENTS, AND INSTRUMENTS, AND ANY PRIOR ORAL AGREEMENTS
      BETWEEN THE PARTIES ARE SUPERSEDED BY AND MERGED INTO SUCH WRITINGS. THIS
      GUARANTY (AS AMENDED IN WRITING FROM TIME TO TIME) THE CREDIT AGREEMENT, AND
      THE
      OTHER WRITTEN LOAN DOCUMENTS EXECUTED BY BORROWERS, LENDER OR GUARANTORS (OR
      BY
      BORROWER OR GUARANTORS FOR THE BENEFIT OF LENDER) REPRESENT THE FINAL AGREEMENT
      BETWEEN BORROWERS, GUARANTORS, AND LENDER AND MAY NOT BE CONTRADICTED BY
      EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BY THE
      PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. THIS
      SECTION IS INCLUDED HEREIN PURSUANT TO SECTION 26.02 OF THE TEXAS BUSINESS
      AND COMMERCE CODE, AS AMENDED FROM TIME TO TIME.

     

    [The
      signatures are on the next page.]

     

    
      
         

      

      
        Page
          8 of
          9

        
          

        

      

      
         

      

    

     

    This
      Guaranty is executed effective as of date first above written.

     

    
      	 	 	 
	 	GUARANTOR:
	 	 
	 	Lothian Oil Texas II, Inc.
	 
 	 
 	 
 
	 	By:  	/s/ C.
              Scott
              Wilson
	 	
              
C.
              Scott Wilson
	 	Chief
              Financial Officer

    

     

    
       

      
        	 	 	 
	 	UHC Petroleum Services Corporation
	 
 	 
 	 
 
	 	By:  	/s/ C.
                Scott
                Wilson
	 	
                
C.
                Scott Wilson
	 	Chief
                Executive Officer and President

      

       

    

    
      
         

        
          	 	 	 
	 	UHC Petroleum Corporation
	 
 	 
 	 
 
	 	By:  	/s/ C.
                  Scott
                  Wilson
	 	
                  
C.
                  Scott Wilson
	 	Chief
                  Executive Officer and President

        

         

      

       

    

     

    

      Signature
        Page to Guaranty

    

     

    
      
         

      

      
        Page
          9 of
          9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]