Merger Agreement and Plan of Reorganization

Exhibit 10.1

Reference is made to that certain Merger Agreement and Plan of Reorganization (as amended, the “ Agreement ”) made and entered into as of February 22, 2006, by and among United Heritage Corporation, a Utah corporation (“ United ”) and Lothian Oil Inc., a Delaware corporation (“ Lothian ”). Capitalized terms used but not defined herein have the respective meanings ascribed to them in the Agreement.

1.   Section 1.6(e) of the Agreement is deleted in its entirety and replaced with the following:

“(e)   Exchange Ratio.   The “ Exchange Ratio ” shall be .80. The Exchange Ratio shall be equitably adjusted to reflect fully the effect of any stock split, reverse split, stock combination, stock dividend (including any dividend or distribution of securities convertible into United Common Stock or Lothian Capital Stock), reorganization, reclassification, recapitalization or other like change with respect to United Common Stock or Lothian Capital Stock occurring after the date hereof and prior to the Effective Time. No adjustment shall be made to the Exchange Ratio as a result of any cancellation of any Lothian Equity Security or any consideration (in any form whatsoever) received by Lothian as a result of any exercise, conversion or exchange of Lothian Equity Securities, after the Effective Time.”

“(g)   United Warrants. At the Effective Time, each holder of United Common Stock as of April 26, 2006 (with the exception of Lothian) will receive a stock purchase warrant to purchase one share of United Common Stock for each share of United Common Stock held by such United shareholder. Each such warrant issued pursuant to this Section 1.6(g) will have a term of five years and an exercise price of $3.00 per share, and will provide for early termination on 30 days written notice if the Market Price of United’s Common Stock closes above $4.50 per share for ten consecutive trading days. The exercise price and number of shares obtainable upon exercise of each such warrant shall be equitably adjusted to reflect fully the effect of any stock split, reverse split, stock combination, stock dividend (including any dividend or distribution of securities convertible into United Common Stock or Lothian Capital Stock), reorganization, reclassification, recapitalization or other like change with respect to United Common Stock occurring after the date hereof.”

3.   Section 8.1(b)(vi) of the Agreement is deleted in its entirety and replaced with the following:

“(vi)   the Effective Time has not occurred before 5 p.m. (Eastern Time) on April 30, 2007, provided, however, that the right to terminate this Agreement under this Section 8.1(b)(vi) shall not be available to any party whose willful failure to fulfill any obligation hereunder has been the cause of, or resulted in, the failure of the Effective Time to occur on or before such date.”

4.   Exhibit D to the Agreement, consisting of the Form of Certificate of Designation of Preferences and Rights of Series A Convertible Preferred Stock of United Heritage Corporation is amended as follows:

(a)    The second introductory paragraph thereof is deleted in its entirety and replaced with the following:

“RESOLVED, that, pursuant to authority vested in the Board of Directors of the Corporation by Article IV of the Corporation’s amended Articles of Incorporation, of the total authorized number of 5,000,000 shares of Preferred Stock of the Corporation, there shall be designated a series of 176,000 shares which shall be issued in and constitute a single series to be known as “Series A Convertible Preferred Stock”, par value $0.0001 per share (hereinafter called the “Series A Preferred”). The shares of Series A Preferred shall have the voting powers, designations, preferences and other special rights, and qualifications, limitations and restrictions thereof set forth below:”

(b)    The first sentence of Section 1(a) thereof is deleted in its entirely and replaced with the following:

“The holders of Series A Preferred shall be entitled to receive dividends at a rate of eight percent (8%) of the liquidation preference of $125.00 per share per annum, which shall be fully cumulative, prior and in preference to any declaration or payment of any dividend (payable other than in shares of common stock, $0.001 par value per share, of the Corporation (the “Common Stock”) or other distribution on the Common Stock of the Corporation.”

(c)    The last sentence of Section 3 thereof is deleted in its entirety and replaced with the following:

“For the purposes hereof, the term “Liquidation Preference(s)” shall mean $125.00 per share with respect to each of the Series A Preferred, plus any and all accrued unpaid dividends thereon.”

(d)    Section 4(a) thereof is deleted in its entirety and replaced with the following:

“All, but not less than all, of the Series A Preferred may be redeemed upon payment of $125.00 per Series A Share, plus accrued and unpaid dividends thereon (the “Redemption Price”), at any time by the Corporation at its sole discretion upon thirty (30) days’ written notice to the holders of the Series A Preferred; provided , however , the Company shall not redeem the Series A Preferred unless, at the time of such redemption, (i) the Company is a reporting company under Section 12 of the Securities Exchange Act of 1934, as amended, and (ii) the Common Stock is traded on the NASDAQ System or in the domestic over-the-counter mar