<PAGE>
As filed with the Securities and Exchange Commission on September __, 1998
Registration No. 33-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
UNITED HERITAGE CORPORATION
_______________________________________________________________________________
(Exact name of issuer as specified in its charter)
Utah 87-0372864
_______________________________________________________________________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2 North Caddo Street, Cleburne, Texas 76031
_______________________________________________________________________________
(Address of Principal Executive Offices)
1998 Stock Option Plan of United Heritage Corporation
_______________________________________________________________________________
(Full title of the plan)
Mr. Walter G. Mize 2 North Caddo Street, Cleburne, Texas 76031
_______________________________________________________________________________
(Name and address of agent for service)
817-641-3681
_______________________________________________________________________________
(Telephone number, including area code, of agent for service)
The Commission is requested to send copies of all communications
and notices to:
Lewis D. Schwartz
Tracy & Holland, L.L.P.
306 West Seventh Street, Suite 500
Fort Worth, Texas 76102
817-335-1050
817-332-3140 (telecopy)
(Counsel for the Issuer)
CALCULATION OF REGISTRATION FEE
_______________________________________________________________________________
Title of Proposed Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate Offer- Registration
be Registered Registered per Share (1)(2) ing Price (1)(2) Fee
_______________________________________________________________________________
Common Stock, 2,000,000 $0.578125 1,156,250 $341.09
par value shares
$0.001
(1) Computed in accordance with Rule 457(c) of the Securities Act of
1933, as amended, on the basis of the average of the closing bid
and asked prices of the Common Stock on the NASDAQ for September
25, 1998.
(2) Determined solely for the purpose of computing the registration
fee.
____________________
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Company with the Commis-
sion are incorporated herein by reference:
(a) Annual Report on Form 10-K for the fiscal year ended
March 31, 1998;
(b) Quarterly Report on Form 10-Q for the quarter ended June
30, 1998; and
(c) The description of the Common Stock contained in the
Company's registration statement filed pursuant to
Section 12 of the Exchange Act, and all amendments
thereto and reports which have been filed for the
purpose of updating such description.
All documents subsequently filed by the Company pursuant to
Sections 13, 14 and 15(d) of the Exchange Act, prior to the filing
of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference
herein and shall be deemed to be a part hereof from the date of the
filing of such documents with the Commission.
ITEM 4. DESCRIPTION OF SECURITIES.
The shares being offered hereunder are registered under
Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Neither any expert named in the Registration Statement as
having prepared or certified any part hereof (or as named as having
prepared or certified a report or valuation for use in connection
with the Registration Statement), nor any counsel for the Company
named in the Prospectus as having given an opinion upon the valid-
ity of the securities being registered or upon other legal matters
in connection with the registration or offering of such securities,
was employed for such purpose on a contingent basis, or at the time
of such preparation, certification or opinion or at any time there-
after through the date of effectiveness of this Registration State-
ment or that part of this Registration Statement to which such
preparation, certification or opinion relates, had, or is to
receive in connection with the Registration Statement, a substan-
tial interest, direct or indirect, in the Company or its subsidiary
or was connected with the Company or the subsidiary as a promoter,
underwriter, voting trustee, director, officer or employee.
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ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Part 9 of the Utah Business Corporation Act (the "Act")
empowers a corporation to indemnify its directors and officers,
advance or reimburse expenses to its directors and officers, and to
purchase insurance with respect to liability arising out of their
capacity or status as directors and officers. Such indemnification
is permissable in certain situations and mandatory in other
situations. In cases where indemnification or advancing or
reimbursing of expenses is permissable, authorization and a
determination of qualification must be made in each specific case.
The Company's articles of incorporation and bylaws provide for the
indemnification of its directors and officers to the full extent
permitted by law. It is the Company's position that because its
articles of incorporation and bylaws provide that the Company shall
indemnify its directors and officers to the full extent permitted
by law, there need only be a determination as to whether the
individual in a specific case qualifies for indemnification under
Part 9, and, if so, that such indemnification is already autho-
rized.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
There are no restricted securities being reoffered or resold
pursuant to this Registration Statement.
ITEM 8. EXHIBITS.
5 Opinion and Consent of Tracy & Holland, L.L.P.*
23.01 Consent of Tracy & Holland, L.L.P. (contained in the
Opinion filed as Exhibit 5 to this Registration State-
ment)*
23.02 Consent of Weaver & Tidwell, independent certified
public accountants*
99.01 1998 Stock Option Plan of United Heritage Corporation*
____________________________________
* Filed herewith.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the Registra-
II-2
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<PAGE>
tion Statement (or the most recent post-effective amend-
ment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously dis-
closed in the Registration Statement or any material
change to such information in the Registration State-
ment;
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the Registration Statement is on
Form S-3 or Form S-8 and the information required to be includ-
ed in a post-effective amendment by those paragraphs is con-
tained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers or
persons controlling the Registrant pursuant to the foregoing
provisions, the Registrant has been informed that in the opinion of
the Commission, such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable. In
the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant
II-3
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<PAGE>
in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.
POWER OF ATTORNEY
Know All Men By These Presents that each person whose signature
appears on the signature pages of this Registration Statement
constitutes and appoints Walter G. Mize and Harold L. Gilliam and
each of them, or any one of them, his true and lawful attorneys-in-
fact and agents, with full power of substitution and resubstitu-
tion, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments to this Registration
Statement, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, or any of them, full power and authority
to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and
agents, or any one of them or his substitutes, may lawfully do or
cause to be done by virtue hereof.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-8, and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the
City of Cleburne, State of Texas, on September 28, 1998.
UNITED HERITAGE CORPORATION
(Registrant)
By:/s/ Walter G. Mize
_________________________
Walter G. Mize, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this report has been signed below by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Walter G. Mize President and Chief September 28,1998
______________________ Executive Officer
Walter G. Mize and Director (Prin-
cipal Executive
Officer)
/s/ Harold L. Gilliam Secretary and September 28, 1998
______________________ Director (Principal
Harold L. Gilliam Financial and
Accounting Officer)
/s/ Dr. Joe Martin Director September 28, 1998
______________________
Dr. Joe Martin
/s/ Theresa D. Turner Director September 28, 1998
______________________
Theresa D. Turner
/s/ C. Dean Boyd Director September 28, 1998
______________________
C. Dean Boyd
II-5
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INDEX TO EXHIBITS
Exhibit
Number Exhibit
_______________________________________________________________________________
5 Opinion and Consent of Tracy & Holland, L.L.P.
23.01 Consent of Tracy & Holland, L.L.P. (contained in the
Opinion filed as Exhibit 5 to this Registration Statement)
23.02 Consent of Weaver & Tidwell, L.L.P., independent
certified public accountants
99.01 1998 Stock Option Plan of United Heritage Corporation
II-6
EXHIBIT 5
TRACY & HOLLAND, L.L.P.
(A REGISTERED LIMITED LIABILITY PARTNERSHIP THAT INCLUDES PROFESSIONAL
CORPORATIONS)
ATTORNEYS AT LAW
306 WEST SEVENTH STREET, SUITE 500
FORT WORTH, TEXAS 76102-4982
J. DAVID TRACY, P.C.
J. WALKER HOLLAND, P.C. FAX (817) 332-3140
MARGARET E. HOLLAND, P.C. TELEPHONE (817) 335-1050
GEORGE T. JOHNS, P.C. METRO (817) 429-9463
LEWIS D. SCHWARTZ, P.C. EMAIL [email protected]
September 28, 1998
United Heritage Corporation
2 North Caddo Street
Cleburne, Texas
Re: Registration Statement on Form S-8, United Heritage
Corporation 1998 Stock Option Plan
Gentlemen:
Pursuant to your request, we have examined a copy of the United
Heritage Corporation 1998 Stock Option Plan (the "Plan"), which was
approved by the Board of Directors of United Heritage Corporation
(the "Company") on July 1, 1998. We have also examined the
Articles of Incorporation of the Company, as amended, the Bylaws of
the Company, and corporate proceedings of the Company as reflected
in minutes of meetings of the shareholders and the Board of Direc-
tors of the Company.
Based upon our examination of the foregoing papers and docu-
ments, together with the examination of such other papers and
documents and the investigation of such matters of law as we have
deemed relevant or necessary in rendering this opinion, we hereby
advise you that we are of the opinion that:
Shares of the Common Stock of the Company purchasable upon the
exercise of any option granted under the Plan will, upon issuance
by the Company in accordance with the terms of the respective
agreements under which such options may be granted, be duly and
validly issued, and will be fully paid and nonassessable, whether
such shares shall theretofore have been authorized but unissued
shares of the Common Stock of the Company or shares reacquired by
the Company and held by it as treasury shares, provided that the
purchase price under each such agreement shall be at least equal to
the par value of the shares issued thereunder.
We consent to the use of this opinion in connection with the
Registration Statement on Form S-8 and the Prospectus constituting
a part thereof filed by the Company with the Securities and Ex-
change Commission for the registration under the Securities Act of
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United Heritage Corporation
September 28, 1998
Page 2
1933, as amended, of 2,000,000 shares of the Common Stock of the
Company and an undetermined number of additional shares as may
become issuable thereunder as required by the anti-dilution provi-
sions of the Plan.
Very truly yours,
TRACY & HOLLAND, L.L.P.
By: Lewis D. Schwartz, P.C.,
Partner
By:/s/ Lewis D. Schwartz
______________________
Lewis D. Schwartz,
President
EXHIBIT 23.02
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in the
registration statement of United Heritage Corporation
on Form S-8 of our report dated April 24, 1998, on our
audits of the consolidated financial statements of
United Heritage Corporation as of March 31, 1998 and
1997, and for each of the three years in the period
ended March 31, 1998, which report is included in the
Annual Report on Form 10-K for the year ended March 31,
1998. We also consent to the reference to our firm
under the caption "Experts."
WEAVER AND TIDWELL, L.L.P.
Fort Worth, Texas
September 28, 1998
EXHIBIT 99.01
1998 STOCK OPTION PLAN
OF UNITED HERITAGE CORPORATION
This is the 1998 Stock Option Plan (the "Plan") of UNITED
HERITAGE CORPORATION, a Utah corporation (the "Company"), under
which stock options (the "Options") may be granted to the direc-
tors, officers, consultants, and/or employees of the Company and/or
its subsidiaries to purchase shares of the Company's $0.001 par
value common stock (the "Common Stock").
Section 1. PURPOSE. The purpose of the Plan is to permit
directors, officers, consultants, and/or employees of the Company
and/or its subsidiaries (now existing or hereafter acquired) to
acquire a proprietary interest in the Company, thereby providing
them with an additional incentive for further promoting the success
of the Company's business operations, to encourage them to remain
as directors, officers, consultants, and/or employees of the
Company and/or its subsidiaries and to assist the Company and its
subsidiaries in attracting and retaining key personnel through the
grant of Options under the Plan. For purposes of this Plan, the
terms "employment" or "employ" shall also include serving as a
director, officer, or consultant to the Company and/or its subsid-
iaries, and the term "employee" shall include any of such persons.
Section 2. ADMINISTRATION OF PLAN. The Plan will be adminis-
tered by a committee (the "Stock Option Committee") consisting of
two members to be appointed by the Company's Board of Directors.
Each member of the Stock Option Committee must be an active Direc-
tor of the Company. Any member of the Stock Option Committee may
at any time be removed by the Company's Board of Directors with or
without cause. Upon the removal, resignation or inability to serve
of any member of the Stock Option Committee, a successor (who must
be an active Director of the Company) shall be selected by the
Company's Board of Directors. At its initial meeting, the members
of the Stock Option Committee shall select one from among them to
act as chairman of the Stock Option Committee. A quorum of the
Stock Option Committee will consist of at least two members of the
Committee, and no action may be taken by the Stock Option Committee
unless a quorum is present and concurs in that action. The Stock
Option Committee shall meet at such times and places as it may
determine to consider the granting of Options under the Plan.
Subject to the provisions of the Plan, the Stock Option Committee
will have authority in its discretion: (a) to construe and
interpret the Plan and all Options granted hereunder and to
determine the terms and provisions (and amendments thereof) of the
Options granted under the Plan (which need not be identical); (b)
to define the terms used in the Plan and in the Options granted
hereunder; (c) to prescribe, amend and rescind rules and regula-
tions relating to the Plan; (d) to recommend the individuals to
whom and the time or times at which Options will be granted, the
number of shares to be subject to each Option and the Option exer-
cise price, and to grant such options; and (e) to make all other
determinations necessary or advisable for the administration of the
Plan. All determinations and interpretations made by the Stock
Option Committee will be binding and conclusive on all persons to
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whom Options are granted and on their legal representatives and
beneficiaries.
Section 3. SHARES SUBJECT TO PLAN. Subject to adjustment as
provided in Section 8 hereof, the shares to be offered under the
Plan will be in whole or in part, as the Board of Directors of the
Company may from time to time determine, authorized but unissued
shares of the Company's Common Stock or issued shares of the
Company's Common Stock which have been reacquired by the Company.
The aggregate number of shares of Common Stock to be delivered upon
exercise of all Options granted under the Plan may not exceed
2,000,000 shares of Common Stock. If any Option granted under the
Plan expires or terminates for any reason without having been
exercised in full, the unpurchased shares of Common Stock subject
thereto will (unless the Plan has been terminated) again be avail-
able for other Options to be granted under the Plan.
Section 4. SELECTION OF OPTIONEES. Options may be granted
under the Plan to present and future directors, officers, consul-
tants, and/or employees of the Company and/or its subsidiaries
(whether now existing or hereafter acquired), all such persons
being hereafter referred to as "Optionees." In determining the
persons to whom Options will be granted and the number of shares of
Common Stock to be covered by each Option, the Stock Option
Committee shall take into account the nature of the services
rendered by such persons, their present and potential contributions
to the success of the Company and such other factors as the Stock
Option Committee in its discretion may deem relevant. An Optionee
who has been granted an Option under the Plan may be granted an
additional Option or Options under the Plan if the Stock Option
Committee so determines.
Section 5. OPTION PRICE. Options granted under the Plan will
be subject to such exercise price as may be determined by the Stock
Option Committee except that in no event shall the exercise price
be less than the par value of the Common Stock (the "Option
Price").
Section 6. TERM OF OPTIONS. The date of the granting of each
Option will be deemed to be the date such Option is granted by the
Stock Option Committee. As of such date the Optionee and the
Company shall execute a Stock Option Agreement in the form attached
hereto as Annex 1. Every Option granted pursuant to the Plan must
be exercised within the number of years after the date of granting
of such Option as determined by the Stock Option Committee and
allowed in the Stock Option Agreement, in the amounts and time
periods allowed in the Stock Option Agreement, which may provide
that a period of time must elapse after the date of grant before
such Options are exerciseable; provided, however, that the Option
may not be exercised as to less than 100 shares at any one time (or
the remaining shares then purchasable under the Option, if less
than 100 shares). The Stock Option Agreement may contain such
other provisions as the Stock Option Committee may, from time to
time, deem advisable.
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Section 7. METHOD OF EXERCISING OPTIONS.
(a) Provided all of the provisions of the Plan have been
fully complied with, each Option may be exercised by forwarding to
the Company's business office in Cleburne, Texas, by certified
letter or hand delivery, a written instrument stating that the
option is being exercised and giving the number of shares with
respect to which it is being exercised. Such written instrument
shall be signed by the person exercising the Option and shall be
accompanied by a certified check or cashier's check for the full
amount of the Option Price. In lieu of paying the Option Price in
cash, and subject to the ability of the Company to repurchase its
Common Stock under Utah corporate law, the optionee may tender and
deliver to the Company with proper stock powers and required
endorsements so many shares of the Company's issued and outstanding
common stock previously acquired, owned and held by the Optionee,
the sale of which is allowable under securities laws, and which
have a fair market value equal to the Option Price. In the event a
person or persons other than an Optionee attempts to exercise the
Option, such written statement mailed to the Company shall demon-
strate compliance with Section 11 hereof and be accompanied by such
proof of right to ownership as is required by the Texas Business
and Commercial Code to be given to transfer agents in connection
with the transfer of securities. The Company shall issue a
certificate representing the shares being received upon exercise of
the Option. All shares represented by any such certificate shall
be fully paid and non-assessable. Subject to the limitations set
forth in the Plan, each Option may be exercised at one time or on
several successive occasion; however, each Option may not be
exercised in an amount less than one hundred shares at any one time
(unless such exercise is being made as to the entire portion of
Common Stock which may be purchased pursuant to the Plan).
(b) Anything herein to the contrary notwithstanding, upon
the occurrence of an event described in Section 8(b) below which
accelerates the time for exercising any Option held by an Optionee
(a "Triggering Event") an Option granted under the Plan, to the
extent it remains unexercised at the time of a Triggering Event,
may be exercised, in whole or in part.
Section 8. CHANGES IN CAPITAL STRUCTURE.
(a) Subject to any required action by the shareholders, the
number of shares of Common Stock covered by each outstanding
Option, the price per share of each such Option, and the aggregate
number of shares remaining available under the Plan shall be pro-
portionately adjusted for any increase or decrease in the number of
issued shares of Common Stock of the Company resulting from a
subdivision or consolidation of shares, the payment of a stock
dividend (but only on the Common Stock), or any other increase or
decrease in the number of such shares effected without receipt of
consideration by the Company, provided that no fractional shares
shall be subject to any Option and each Option shall be adjusted
downward to the nearest full share.
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(b) Subject to any required action by the shareholders, if
the Company is the surviving corporation in any merger or consoli-
dation, each outstanding Option will pertain to and apply to the
securities to which a holder of the number of shares of Common
Stock subject to the Option would have been entitled. A dissolu-
tion or liquidation of the Company, or a merger or consolidation in
which the Company is not the surviving corporation, will cause each
outstanding Option to terminate, provided that in such event each
Optionee may (immediately prior to such dissolution or liquidation,
or merger or consolidation in which the Company is not the surviv-
ing corporation) exercise such Optionee's Option, subject to the
terms and provisions of Section 7 hereof.
(c) In the event of a conversion or exchange of all of the
Company's Common Stock with par value into the same number of
shares with a different par value or without par value, the shares
resulting from any such conversion or exchange shall be deemed to
be Common Stock within the meaning of the Plan.
(d) To the extent that the foregoing adjustments relate to
stock or securities of the Company, such adjustments shall be made
by the Stock Option Committee whose determination in that respect
shall be final, binding and conclusive. Notwithstanding any of the
foregoing adjustments, no adjustment may be made in the minimum
number of shares which may be purchased at any one time as provided
in Section 7(a) above.
(e) Except as hereinbefore expressly provided in this Sec-
tion 8, an Optionee will have no rights by reason of any subdivi-
sion or consolidation of shares of stock of any class, the payment
of any stock dividend or any other increase or decrease in the
number of shares of stock of any class resulting from a dissolu-
tion, liquidation, merger, consolidation or other reorganization
with another corporation. Any issue by the Company of shares of
stock of any class, or securities convertible into shares of stock
of any class, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of
Common Stock subject to the Option.
(f) The grant of an Option pursuant to the Plan will not
affect in any way the right or power of the Company to make adjust-
ments, reclassifications, reorganizations or changes in its capital
or business structure; nor affect in any way the right or power of
the Company to merge, consolidate, dissolve, liquidate, sell or
otherwise transfer all or any part of its business or assets.
Section 9. TERMS AND CONDITIONS RELATING TO EMPLOYMENT.
(a) A primary reason for the Company's granting the Options
under the Plan is to encourage each Optionee to remain directors,
officers, consultants, and/or employees of the Company and/or its
subsidiaries. Accordingly, if such status as director, officer,
consultant, and/or employee is terminated for any reason other than
upon the completion of a contract with a specified term or with and
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upon the written consent of the Company, which consent may be
granted or withheld solely in the discretion of the Company, then
such Optionee's Option granted hereunder and then held by such
Optionee (to the extent of the unexercised portion thereof) will be
deemed to have expired on the same date as such termination
occurred (or 90 days prior thereto if an Optionee attempts to
exercise such Optionee's Option in anticipation of such termina-
tion). The failure of the Company to promptly declare that such
Option is deemed to have expired after the occurrence of any such
event will not constitute a waiver of such right, and the Company
may at any time thereafter declare such Option to have expired
regardless of its actions during the interim period. Under no
circumstances may an Optionee's Option be in any way affected by
any change of the Optionee's activities, title or position within
the group consisting of the Company and its subsidiaries. An
Optionee who terminates his employment with the Company qualifying
him for Options hereunder with the written consent of the Company
may exercise his Option within three (3) months following the date
of such termination.
(b) The Stock Option Committee may, in its discretion,
include in any Option granted under the Plan a condition that the
Optionee shall agree to remain in the employ of the Company or any
of its subsidiaries for a period of time (specified in the Stock
Option Agreement) following the date the Option is granted. No
such agreement shall impose upon the Company or any of its subsid-
iaries, however, any obligation to employ the Optionee for any
period of time.
Section 10. DEATH OF OPTIONEE. If an Optionee dies while in
the employ of the Company or one of its subsidiaries, then the
unexercised portion (to the extent then unexercised) of such
Optionee's Option may be exercised in full at any time (to the
extent that the Optionee shall have been entitled to do so at the
date of his death) within one (1) year after the date of such
Optionee's death, but only if exercised by an heir, devisee or
personal representative of the deceased Optionee's estate who
acquired the Option directly from the Optionee through the latter's
will or pursuant to the applicable laws of descent and distribu-
tion.
Section 11. NONTRANSFERABILITY. No Option may be sold,
pledged, assigned, hypothecated, transferred or disposed of in any
manner other than by will or by the laws of descent and distribu-
tion, or pursuant to a qualified domestic relations order as
defined by the Internal Revenue Code of 1986, as amended, or Title
I of the Employee Retirement Income Security Act, or the rules
thereunder. Each Option is exercisable, during the lifetime of an
Optionee, only by the Optionee. Any attempted assignment, trans-
fer, pledge, hypothecation or other encumbrance of any Option
contrary to the provisions hereof, and any execution, attachment or
similar process upon any Option, will be null, void and of no
effect.
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Section 12. RIGHTS AS SHAREHOLDER. No Optionee may have any
rights as a shareholder with respect to any shares of the Company's
Common Stock covered by these Options until the date of issuance of
a stock certificate to such Optionee for such shares after exer-
cise. Except as is otherwise provided in Section 8 above, no
adjustment will be made for dividends (ordinary or extraordinary
and whether in cash, securities or other property) or distributions
or other rights for which the record date is prior to the date such
stock certificate is issued.
Section 13. COMPANY'S OBLIGATIONS. The Company agrees to
maintain at all times sufficient authorized but unissued or
reacquired stock to meet the requirements of the Plan. The
proceeds received by the Company from the sale of the Common Stock
pursuant to these Options shall be used for general corporate
purposes. The Company further agrees to pay all fees and expenses
necessarily incurred by the Company in connection with these
Options. Although the Company shall in no event be obligated to
register any securities covered hereby pursuant to the Securities
Act of 1933, as amended (the "Act"), it will use its best efforts
to comply with all laws and regulations which, in the opinion of
the Company's counsel, are applicable thereto. The inability of
the Company to obtain from any regulatory body having jurisdiction
the authority deemed necessary by counsel for the Company for the
lawful issuance and sale of Common Stock hereunder shall relieve
the Company of any liability in respect of the failure to issue or
sell Common Stock as to which the requisite authority has not been
obtained.
Section 14. REQUIREMENTS OF LAW.
(a) The Company shall not be required to sell or issue any
shares of Common Stock subject to the Options if the issuance of
such shares shall constitute a violation of any provision of any
law or regulation of any governmental authority. Specifically, in
connection with the Act, upon exercise of an Option, unless a
registration statement under the Act is in effect with respect to
the shares of Common Stock covered by the Option, the Company shall
not be required to issue such shares of Common Stock unless the
Company has received an opinion of counsel that registration of
such shares is not required. Any reasonable determination in this
connection by the Company shall be final, binding and conclusive.
If required by the Act or applicable state law in the opinion of
counsel for the Company, an appropriate legend shall be placed on
certificates representing shares of Common Stock issued pursuant to
the exercise of an Option.
(b) As a condition to the exercise of any portion of an
Option, the Company may require the Optionee exercising such Option
to represent and warrant at the time of such exercise that any
shares of Common Stock acquired at exercise are being acquired only
for investment and without any present intention to sell or dis-
tribute such shares, if, in the opinion of counsel for the Company,
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<PAGE>
such a representation is required under the Act or any other
applicable law, regulation or rule of any governmental agency.
Section 15. RELIANCE ON REPORTS. Each member of the Stock
Option Committee and each member of the Board of Directors shall be
fully justified in relying or acting in good faith upon any report
made by the independent public accountants of the Company and its
subsidiaries and upon any other information furnished in connection
with the Plan by any person or persons other than himself. In no
event shall any person who is or shall have been a member of the
Stock Option Committee or of the Board of Directors be liable for
any determination made or other action taken or any omission to act
in reliance upon any such report or information or for any action,
including the furnishing of information, taken or failure to act,
if in good faith.
Section 16. AMENDMENT OR TERMINATION OF PLAN. The Company's
Board of Directors may at any time amend the provisions of the Plan
for the purpose of complying with applicable corporate, securities,
or federal tax laws. Further, the Board of Directors may at any
time amend, alter or discontinue the Plan, except that no amendment
or alteration may be made which would impair the rights of any
Optionee under any Option previously granted without such Option-
ee's consent.
Section 17. MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS.
Subject to the terms and conditions and within the limitations of
the Plan, the Stock Option Committee may modify, extend or renew
outstanding options granted under the Plan, or accept the surrender
of outstanding options (to the extent not theretofore exercised)
and authorize the granting of new options in substitution therefor
(to the extent not theretofore exercised), including canceling
outstanding options and reissuing new options at a lower Option
Price in the event that the fair market value per share of Common
Stock at any time prior to the date of exercise falls below the
Option Price of options granted pursuant to the Plan. Notwith-
standing the foregoing, however, no modification of an option
shall, without the consent of the participant, alter or impair any
rights or obligations under any option theretofore granted under
the Plan.
Section 18. EFFECTIVE DATE. The Plan shall become effective
as of the date of its adoption by the Board of Directors of the
Company.
The Secretary of the Company hereby certifies that the Plan was
adopted by the Board of Directors effective the first day of July,
1998.
/s/Harold L. Gilliam
-----------------------------
Harold L. Gilliam, Secretary
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<PAGE>
Annex 1
STOCK OPTION AGREEMENT
This STOCK OPTION AGREEMENT ("Agreement") is made this ___ day
of __________, 199___ between United Heritage Corporation, a Utah
corporation (the "Company"), and ________________, hereinafter
called the Optionee.
The Company desires, by affording the Optionee an opportunity
to purchase shares of its $0.001 par value common stock (the "Com-
mon Stock"), as hereinafter provided, to carry out the purpose of
the 1998 Stock Option Plan of United Heritage Corporation (the
"Plan"), approved and adopted by its directors.
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth and for other good and valuable consider-
ation, the parties hereto agree as follows:
1. Grant of Option. The Company hereby irrevocably grants
to the Optionee the right and option (the "Option") to purchase all
or any part of an aggregate of ______ shares of Common Stock (such
number being subject to adjustment as provided in Section 8 of the
Plan) on the terms and conditions herein set forth and subject
further to all of the terms and provisions of the Plan which are
incorporated herein by reference for all purposes. For purposes of
the Plan and this Agreement, the terms "employment" or "employ"
shall also include serving as a director, officer, or consultant to
the Company and/or its subsidiaries, and the term "employee" shall
include any of such persons.
2. Purchase Price. The purchase price of the Common Stock
covered by the Option shall be $_________ per share.
3. Term of Option. Subject to earlier termination as pro-
vided in paragraphs 5 and 6 hereof, the term of the Option, and any
limitations on number of shares or time periods that it may be
exercised are as follows:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Unless otherwise stated above, the Options may be exercised, prior
to expiration or termination, at any time or from time to time, as
to any part or all of the shares covered thereby; provided, howev-
er, that the Option may not be exercised as to less than 100 shares
at any one time (or the remaining shares then purchasable under the
Option, if less than 100 shares). The purchase price of the shares
as to which the Option shall be exercised shall be paid in full in
cash, or by the delivery of other shares of Common Stock of the
Company, at the time of exercise and as provided by the Plan.
Except as provided in paragraphs 5 and 6 hereof, the Option may not
be exercised at any time unless the Optionee shall have been in the
continuous employ of the Company and/or of one or more of its
PAGE
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subsidiaries, from the date hereof to the date of the exercise of
the Option. The holder of the Option shall not have any of the
rights of a shareholder with respect to the shares covered by the
Option except to the extent that one or more certificates for such
shares shall be delivered to him upon the due exercise of the
Option. The Option may not be exercised unless at the date of
exercise a registration statement on Form S-8 under the Securities
Act of 1933, as amended (the "Act"), relating to the shares covered
by the Option shall be in effect, or if, in the opinion of counsel
for the Company, the exercise and issuance of Common Stock would be
exempt from registration requirements under the Act and under
applicable securities laws. The Company is under no obligation to
register the shares covered by the Option under the Act.
4. Nontransferability. The Option shall not be
transferable otherwise than by will or the laws of descent and
distribution, or pursuant to a qualified domestic relations order
as defined by the Internal Revenue Code of 1986, as amended, or
Title I of the Employee Retirement Income Security Act, or the
rules thereunder, and the Option may be exercised, during the
lifetime of the Optionee, only by him. More particularly (but
without limiting the generality of the foregoing), the Option may
not be assigned, transferred (except as provided above), pledged or
hypothecated in any way, shall not be assignable by operation of
law, and shall not be subject to execution, attachment or similar
process. Any attempted assignment, transfer, pledge, hypothecation
or other disposition of the Option contrary to the provisions
hereof, and they levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
5. Termination of Employment. In the event the employment
of the Optionee shall be terminated, other than with and upon the
written consent of the Company, which consent may be granted or
withheld solely in the discretion of the Company, or pursuant to
completion of an agreement containing a specific term duration,
then such Optionee's Option granted hereunder and then held by such
Optionee (to the extent of the unexercised portion thereof) will be
deemed to have expired on the same date as such termination oc-
curred (or 90 days prior thereto if an Optionee attempts to exer-
cise such Optionee's Option in anticipation of such termination).
The failure of the Company to promptly declare that such Option is
deemed to have expired after the occurrence of any such event will
not constitute a waiver of such right, and the Company may at any
time thereafter declare such Option to have expired regardless of
its actions during the interim period. Nothing in this Agreement
shall confer upon the Optionee any right to continue in the employ
of the Company or of any of its subsidiaries or interfere in any
way with the right of the Company or any such subsidiaries to
terminate his employment at any time.
6. Death of Optionee. If the Optionee shall die while he
shall be employed by the Company or one or more of its subsidiar-
ies, the Option may be exercised (to the extent that the Optionee
shall have been entitled to do so at the date of his death) by a
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<PAGE>
legatee or legatees of the Optionee under his last will, or by his
personal representatives or distributees, at any time within one
(1) year after his death.
7. Method of Exercising Option. This Option may be exer-
cised by written notice to the Company.
8. Subsidiary. As used herein, the term "subsidiary" shall
mean any present or future corporation which would be a "subsidiary
corporation" of the Company, as that term is defined in Section 425
of the Internal Revenue Code of 1986.
10. Other Matters. The Optionee acknowledges receipt of a
copy of the Plan, a copy of which is annexed hereto, and represents
that the Optionee is familiar with the terms and provisions there-
of. The Optionee hereby accepts this Option subject to all of the
terms and provisions of the Plan. The Optionee hereby agrees to
accept as binding, conclusive and final all decisions and interpre-
tations of the Board of Directors and, where applicable, the Stock
Option Committee, upon any questions arising under the Plan or this
Agreement. As a condition to the issuance of shares of Common
Stock of the Company under this Agreement, the Optionee authorizes
the Company to withhold in accordance with applicable law from any
regular cash compensation payable to him any taxes required to be
withheld by the Company under federal, state or local law as a
result of his exercise of this Option.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
duly executed by its officers thereunto duly authorized, and the
Optionee has hereunto set his hand, all on the date and year first
above written.
COMPANY: UNITED HERITAGE CORPORATION
Attest:
____________________________ By:____________________________
___________________, ______________________,
___________ ___________
OPTIONEE: _______________________________
_________________________
_______________________________
_______________________________
(Address)
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