wellquest_s1a-ex1011.htm


    EXHIBIT
10.11

    


    THE
SECURITIES REPRESENTED BY THIS DEBENTURE AND THE WARRANTS AND STOCK REFERENCED
HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER THE
OKLAHOMA SECURITIES ACT OR ANY OTHER STATE SECURITIES LAW, AND SUCH SECURITIES
MAY NOT BE OFFERED, RESOLD, ASSIGNED OR TRANSFERRED BY A PURCHASER THEREOF
WITHOUT BEING REGISTERED UNDER THE SECURITIES ACT OF 1933, THE OKLAHOMA
SECURITIES ACT AND ANY OTHER APPLICABLE STATE SECURITIES LAW OR UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE IN THE OPINION OF COUNSEL TO THE
COMPANY.  THIS IS A LIMITED OFFERING TO BE MADE ONLY PURSUANT TO
EXEMPTIONS PROVIDED BY THE SECURITIES ACT OF 1933 AND APPLICABLE STATE
SECURITIES LAWS.  NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR
ANY STATE AGENCY HAS PASSED UPON THE VALUE OF THESE SECURITIES, APPROVED OR
DISAPPROVED THIS OFFERING OR PASSED UPON THE ADEQUACY OR ACCURACY OF ANY
INFORMATION PROVIDED TO THE UNDERSIGNED.

    


    


    SUBORDINATED
CONVERTIBLE DEBENTURE WITH WARRANTS

    


     

    
      	$________.00	
              __________,
      2008

            


    

     

     

    FOR VALUE
RECEIVED, HQHealthQuest Medical
& Wellness Centers, Ltd., an
Oklahoma corporation (the “Company”), promises to pay to the order of _______________________________,
whose address is __________________________
(the “Holder”) the principal sum of ______________________________ and  /100 Dollars
($________.00) (the
“Principal Amount”), together with interest thereon as set forth below, at the
Holder’s office or such other place as the Holder may designate in writing to
the Company. As additional consideration for the Holder’s loan to the Company,
the Company shall issue to the Holder warrants to purchase shares of the common
stock of the Company for a discounted price, on the terms and in the form
attached hereto as EXHIBIT “A” (the “Warrant”), pursuant to which the Holder
will have the option to either: (i) exercise the
Warrant and acquire common stock, or (ii) exercise the conversion feature of
this Debenture, and acquire preferred stock of the Company).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.  Interest
Rate.   Except as provided in this Section, from the date
hereof  until repayment of this Debenture in full, interest shall
accrue on the unpaid outstanding balance of the Principal Amount of this
Debenture at the fixed rate of ten percent (10%) per annum, simple (the
“Interest Rate”) and shall be paid in arrears on a quarterly basis. Interest
shall be calculated on the basis of the actual number of days elapsed over a 360
day year. If the Company shall fail to make a payment of principal or
interest when due, and such failure shall not be cured within ten (10) days of
the Company’s receipt of written notice from the Holder of the failure, interest
shall accrue on the unpaid outstanding balance of the Principal Amount of this
Debenture from the date which is ten (10) days after the Company’s receipt of
the notice to cure until the late payment is made  at the fixed rate
of thirteen percent (13%) per annum, simple.

     

    2.  Payment
Provisions.

     

    (a)  Interest
Payments.  Commencing on April 1, 2007 and continuing on or
before the fifth day after the expiration of each calendar quarter thereafter
until this Debenture is paid in full, the Company shall pay to the Holder
installments of interest only (in arrears).

     

    (b)  Principal
Payments.  On January 1, 2009, (the “Maturity
Date”) the outstanding balance of the Principal Amount shall be due and
payable in full by the Company to the Holder.

     

    (c)  Prepayments; Application of
Payments.  The Company may at any time and from time to time
prepay all or any part of the outstanding balance of the Principal Amount,
together with all or any part of the interest evidenced by this Debenture,
without penalty upon at least three business days’ prior written or electronic
notice (or telephone notice promptly confirmed by written or electronic notice)
to the Holder.   If the Company is current on all of its payment
obligations under this Debenture, the Holder shall apply payments received from
the Company on this Debenture against the outstanding balance of the Principal
Amount.

     

    3.  Subordination.  The
rights of the Holder under this Debenture to collect  the amounts due
under this Debenture are subordinated to the rights of the banks from which the
Company has borrowed or may borrow money under the terms of the notes, security
agreements and other instruments governing those debts.

     

    4.  Representations and
Warranties of Company.  The Company hereby represents and
warrants to the Holder that, the statements contained in the following
paragraphs of this Section 4 are all true and correct as of the date this
Debenture is signed by the Company:

     

    (a)  Organization and
Standing. The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Oklahoma and has all
requisite corporate power and authority to carry on its business as now
conducted.

     

    (b)  Corporate Authority.
The Company has all requisite legal and corporate authority to enter into,
execute and deliver this Debenture and the Warrant. This Debenture, and upon
issuance, the Warrant will be valid and binding obligations of the Company,
enforceable in accordance with their terms, except as the same may be limited by
bankruptcy, insolvency, moratorium, and other laws of general application
affecting the enforcement of creditors’ rights.

     

    
      
        
        

      

      
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    (c)  Authorization.

     

    (1)  Corporate Action. All
corporate and legal action on the part of the Company, its officers, directors
and shareholders necessary for the execution and delivery of this Debenture and
the Warrant, the sale and issuance of the Warrant and the shares to be issued in
the event of the exercise of the Warrant or the conversion of this Debenture,
and the performance of Company’s obligations hereunder and under the Warrant
have been taken.

     

    (2)  Valid Issuance. This
Debenture and the Warrant, and shares of the Company’s Common Stock issued upon
exercise of the Warrant or, in the alternative, the shares of the Company’s
Preferred Stock to be issued upon conversion of this Debenture (collectively,
the “Securities”), when issued in compliance with the provisions of this
Debenture or the Warrant will be validly issued and will be free of any liens or
encumbrances; provided,
however, that the Securities are subject to restrictions on transfer under state
or federal securities laws, and as may be required by future changes in such
laws.

     

    5.  Representations and
Warranties By Holder.  The Holder represents and warrants to
the Company as of the date of this Debenture as follows:

     

    (a)  Investment Intent
Authority.  This Debenture is executed and delivered to the
Holder in reliance upon the Holder’s representation to Company
that:  (i) the Holder is acquiring this Debenture and the
Warrant, and any Securities that may be acquired upon the exercise of the
Warrant or the alternative conversion of this Debenture, for investment for the
Holder’s own account, not as nominee or agent, for investment and not with a
view to, or for resale in connection with, any distribution or public offering
thereof within the meaning of the Securities Act of 1933, as amended, (the
“Securities Act”); and (ii) the Holder has the full right, power, authority and
capacity to make the loan evidenced by this Debenture.

     

    (b)  Securities
Not Registered.
The Holder understands and
acknowledges that the offering of the Securities represented by this
Debenture
and the Warrant will not
be registered under any federal or State securities laws or
regulations.

     

    6.  Conversion.

     

    (a)  Conversion at Option of
Holder.  This Debenture shall be convertible in full into
shares of the Company’s Class A Convertible Preferred Stock at the option of the
Holder at any time after the date hereof.  No partial conversions of
the Debenture shall be allowed. The number of shares of Preferred Stock issuable
upon a conversion hereunder equals the quotient obtained by dividing (x) the
outstanding amount of this Debenture to be converted by (y) the Conversion Price
(as defined in Section 6(d)(i)). The Company shall deliver Preferred Stock
certificates to the Holder prior to the fifth (5th)
business day after a Conversion Date as defined below.

     

    
      
        
        

      

      
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    (b)  Conversion in Lieu of
Exercise of Warrant.  Pursuant to this Debenture the Holder has
the option to either convert the Debenture into shares of Preferred Stock
(subject to adjustment as provided herein) or to exercise the Warrant to acquire
shares of Common Stock (at the exercise price and subject to adjustment as
provided in the Warrant).

     

    In the
event of the conversion of all of this Debenture into shares of Preferred Stock,
the Holder will surrender this Debenture and the Warrant to the Company, and
Warrant shall be cancelled.  In the event of the exercise of the
Warrant (which, pursuant to its terms, is exercisable in its entirety only),
then the Warrant shall be surrendered to the Company, and the conversion feature
of this Debenture shall lapse without any further action on the part of the
Company,  In the event of the exercise of the Warrant, the Company
shall have the right to require the Holder to submit this Debenture to the
Company, in exchange for an identical debenture in all respects other than the
convertibility feature.

     

    (c)  Conversion
Procedure.

     

    The
Holder shall effect a conversion by delivering to the Company a completed notice
in the form attached hereto as EXHIBIT B (a “Conversion Notice”),
together with the delivery of the Warrant.  The date on which a
Conversion Notice is delivered is the “Conversion
Date”.  A conversion hereunder shall have the effect of paying
the outstanding principal amount of this Debenture plus all accrued and unpaid
interest thereon. The Holder and the Company shall maintain records showing the
amount converted and the date of such conversion. In the event of any dispute or
discrepancy, the records of the Company shall be controlling and determinative
in the absence of manifest error.


    (d)  Conversion Price and
Adjustments to Conversion Price.

     

    (i)  The conversion price in
effect on the date hereof is equal to $22.22 per share (the “Conversion Price”).
The Conversion Price may be adjusted pursuant to the terms of this
Debenture.

     

    (ii)  If the Company, at any
time while this Debenture is outstanding, shall (a) pay a stock dividend or
otherwise make a distribution or distributions on shares of its Preferred Stock
or any other equity or equity equivalent securities payable in shares of
Preferred Stock, (b) subdivide outstanding shares of Preferred Stock into a
larger number of shares, (c) combine (including by way of reverse stock split)
outstanding shares of Preferred Stock into a smaller number of shares, or (d)
issue by reclassification of shares of the Preferred Stock any shares of capital
stock of the Company, then the Conversion Price shall be multiplied by a
fraction of which the numerator shall be the number of shares of Preferred Stock
(excluding treasury shares, if any) outstanding before such event and of which
the denominator shall be the number of shares of Preferred Stock outstanding
after such event. Any adjustment made pursuant to this Section shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or re-classification.

     

    
      
        
        

      

      
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    (iii)  If the Company, at any
time while this Debenture is outstanding, shall issue rights, options or
warrants to all holders of Preferred Stock (and not to the Holder) entitling
them to subscribe for or purchase shares of Preferred Stock at a price per share
less than the Conversion Price, then the Conversion Price shall be multiplied by
a fraction, of which the denominator shall be the number of shares of the
Preferred Stock (excluding treasury shares, if any) outstanding on the date of
issuance of such rights or warrants (plus the number of additional shares of
Preferred Stock offered for subscription or purchase), and of which the
numerator shall be the number of shares of the Preferred Stock (excluding
treasury shares, if any) outstanding on the date of issuance of such rights or
warrants, plus the number of shares which the aggregate offering price of the
total number of shares so offered would purchase at the Conversion Price. Such
adjustment shall be made whenever such rights or warrants are issued, and shall
become effective immediately after the record date for the determination of
stockholders entitled to receive such rights, options or warrants. However, upon
the expiration of any such right, option or warrant to purchase shares of the
Common Stock the issuance of which resulted in an adjustment in the Conversion
Price pursuant to this Section, if any such right, option or warrant shall
expire and shall not have been exercised, the Conversion Price shall immediately
upon such expiration be recomputed and effective immediately upon such
expiration be increased to the price which it would have been (but reflecting
any other adjustments in the Conversion Price made pursuant to the provisions of
this Section after the issuance of such rights or warrants) had the adjustment
of the Conversion Price made upon the issuance of such rights, options or
warrants been made on the basis of offering for subscription or purchase only
that number of shares of the Preferred Stock actually purchased upon the
exercise of such rights, options or warrants actually exercised.

     

    (iv)  If the Company, at any
time while this Debenture is outstanding, shall issue shares of Preferred Stock
or rights, warrants, options or other securities or debt that are convertible
into or exchangeable for shares of Preferred Stock (“Preferred Stock Equivalents”)
entitling any Person to acquire shares of Preferred Stock, at a price per share
less than the Conversion Price (if the holder of the Preferred Stock or
Preferred Stock Equivalent so issued shall at any time, whether by operation of
purchase price adjustments, reset provisions, floating conversion, exercise or
exchange prices or otherwise, or due to warrants, options or rights per share
which is issued in connection with such issuance, be entitled to receive shares
of Preferred Stock at a price per share which is less than the Conversion Price,
such issuance shall be deemed to have occurred for less than the Conversion
Price), then, at the sole option of the Holder, the Conversion Price shall be
adjusted to mirror the conversion, exchange or purchase price for such Preferred
Stock or Preferred Stock Equivalents (including any reset provisions thereof) at
issue. Such adjustment shall be made whenever such Preferred Stock or Preferred
Stock Equivalents are issued. The Company shall notify the Holder in writing, no
later than five (5) business days following the issuance of any Preferred Stock
or Preferred Stock Equivalent subject to this Section, indicating therein the
applicable issuance price, or of applicable reset price, exchange price,
conversion price and other pricing terms.

     

    
      
        
        

      

      
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    (v)  In case of any
reclassification of the Preferred Stock or any compulsory share exchange
pursuant to which the Preferred Stock is converted into other securities, cash
or property, the Holder shall have the right thereafter to, at its option, (A)
convert the then outstanding principal amount, together with all accrued but
unpaid interest and any other amounts then owing hereunder in respect of this
Debenture into the shares of stock and other securities, cash and property
receivable upon or deemed to be held by holders of the Preferred Stock following
such reclassification or share exchange, and the Holder of this Debenture shall
be entitled upon such event to receive such amount of securities, cash or
property as the shares of the Preferred Stock of the Company into which the then
outstanding principal amount, together with all accrued but unpaid interest and
any other amounts then owing hereunder in respect of this Debenture could have
been converted immediately prior to such reclassification or share exchange
would have been entitled, or (B) require the Company to prepay the outstanding
principal amount of this Debenture, plus all interest and other amounts due and
payable thereon. The entire prepayment price shall be paid in cash. This
provision shall similarly apply to successive reclassifications or share
exchanges.

     

    (vi)  Whenever the Conversion
Price is adjusted pursuant to this Section, the Company shall promptly mail to
the Holder a notice setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such
adjustment.

     

    (vii)  If (A) the Company shall
declare a dividend (or any other distribution) on the Preferred Stock; (B) the
Company shall authorize the granting to all holders of the Preferred Stock
rights or warrants to subscribe for or purchase any shares of capital stock of
any class or of any rights; (C) the approval of any stockholders of the Company
shall be required in connection with any reclassification of the Preferred
Stock, any consolidation or merger to which the Company is a party, any sale or
transfer of all or substantially all of the assets of the Company, of any
compulsory share exchange whereby the Preferred Stock is converted into other
securities, cash or property; or (D) the Company shall authorize the voluntary
or involuntary dissolution, liquidation or winding up of the affairs of the
Company; then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Debenture, and shall
cause to be mailed to the Holder at its last address as it shall appear upon the
stock books of the Company, at least twenty (20) calendar days prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken,
the date as of which the holders of the Preferred Stock of record to be entitled
to such dividend, distributions, redemption, rights or warrants are to be
determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer or share exchange is expected to become effective or
close, and the date as of which it is expected that holders of the Preferred
Stock of record shall be entitled to exchange their shares of the Preferred
Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer or share exchange,
provided, that the failure to mail such notice or any defect therein or in the
mailing thereof shall not affect the validity of the corporate action required
to be specified in such notice. The Holder is entitled to convert this Debenture
during the 20-day calendar period commencing the date of such notice to the
effective date of the event triggering such notice.

     

    
      
        
        

      

      
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    7.  Assignment.  This
Debenture and the obligations hereunder may not be assigned by the Company
without the prior written consent of the Holder.  .

     

    8.  Default and
Remedies.  The occurrence of an event of default under the
Debenture shall constitute a default hereunder and during the continuation
thereof shall entitle the Holder to exercise the rights and remedies of a
creditor under law or in equity.

     

    9.  Waivers.  The
Company hereby waives presentment, demand, protest or further notice of any kind
to the extent permitted by applicable law.

     

    10.  Controlling Law; Attorneys’
Fees.  This Debenture, the Warrant and all matters related
hereto shall be governed, construed and interpreted in accordance with the laws
of the State of Oklahoma, without regard to its principles of conflicts of
laws.  In the event an action is brought to enforce this Debenture,
the prevailing party shall be entitled to recover a reasonable attorney’s fee
and costs to be set by the court.

     

    11.  Purpose of Loan. The
Company represents and warrants that this Debenture evidences an investment made
in the Company made for the purpose of carrying on a business or commercial
enterprise.  There are no restrictions on the use of the loan
proceeds, as long as the same are used for the Company’s business.

     

    12.  No
Usury.  This Debenture is subject to the express condition that
at no time shall the Company be obligated or required to pay interest hereunder
at a rate that could subject the Holder to either civil or criminal liability as
a result of being in excess of the maximum rate that the Company is permitted by
law to contract or agree to pay.  If, by the terms of this Debenture,
the Company is at any time required or obligated to pay interest at a rate in
excess of such maximum rate, the rate of interest under this Debenture shall be
deemed to be immediately reduced to such maximum rate and interest payable
hereunder shall be computed at such maximum rate and the portion of all prior
interest payments in excess of such maximum rate shall be applied and shall be
deemed to have been payments in reduction of the principal balance of this
Debenture.

     

    13.  Waiver of Trial by
Jury.  The Company and the Holder agree that any suit, action
or proceeding, whether claim or counterclaim, brought or instituted by the
Company or the Holder on or with respect to this Debenture, the Warrant or any
event, transaction or occurrence arising out of or in any way connected
therewith or dealing with the parties hereto, shall be tried only by a court and
not by a jury.  THE
COMPANY AND THE HOLDER HEREBY EXPRESSLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN
ANY SUCH SUIT, ACTION OR PROCEEDING.

     

    
      
        
        

      

      
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    14.  Severability.  In
the event any one or more of the provisions contained in this Debenture shall
for any reason be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other
provision of this Debenture, but this Debenture shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein or
therein.

     

    IN WITNESS WHEREOF, the
undersigned has caused this Debenture to be executed on the day and year first
above written.

     

    


     

    
      	HQHealthQuest Medical &
      Wellness Centers,
      Ltd.	Holder
	 	 
	
              By
      _____________________________

              Stephen H. M. Swift,
      President

            	
              ________________________

               

            


    

     

     

    
      
        
        

      

      
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    EXHIBIT
A TO DEBENTURE

    HQHealthQuest Medical & Wellness
Centers,
Ltd.

     

    
      
        
          

        

      

      THE
SECURITIES REPRESENTED BY THESE WARRANTS AND THE STOCK REFERENCED HEREIN HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER THE OKLAHOMA
SECURITIES ACT OR ANY OTHER STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE
OFFERED, RESOLD, ASSIGNED OR TRANSFERRED BY A PURCHASER THEREOF WITHOUT BEING
REGISTERED UNDER THE SECURITIES ACT OF 1933, THE OKLAHOMA SECURITIES ACT AND ANY
OTHER APPLICABLE STATE SECURITIES LAW OR UNLESS AN EXEMPTION FROM REGISTRATION
IS AVAILABLE IN THE OPINION OF COUNSEL TO THE COMPANY.  THIS IS A
LIMITED OFFERING TO BE MADE ONLY PURSUANT TO EXEMPTIONS PROVIDED BY THE
SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS.  NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE AGENCY HAS PASSED UPON THE
VALUE OF THESE SECURITIES, APPROVED OR DISAPPROVED THIS OFFERING OR PASSED UPON
THE ADEQUACY OR ACCURACY OF ANY INFORMATION PROVIDED TO THE
UNDERSIGNED.

    

    
      
        
          

        



       

      
        	
                Warrant
      No.:_____________

                Date of Grant:____________

              	
                Number of
      Shares:____________

              


      

       

    

    


    WARRANT
TO PURCHASE SHARES

    OF
COMMON STOCK

     

    THIS
CERTIFIES THAT, for value received, ________________________ (the “Holder”) and
the Holder’s permitted assignees are entitled to subscribe for and purchase
________ shares of the fully paid and nonassessable Common Stock (as adjusted
from time to time pursuant to the provisions of this Warrant), the (“Shares”) of
HQHealthQuest Medical
& Wellness Centers, Ltd., an
Oklahoma corporation (the “Company”), on the following terms and conditions and
for the price set forth in this Warrant.  As used herein, the term
“Date of Grant” shall mean the Date of Grant listed above.

     

    
      1.  Number of Shares, Exercise
Price and Term:

       

      (a)  The number of Shares for
which this Warrant is exercisable is set forth in the preceding
paragraph.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (b)  Warrant
Price.  The price at which this Warrant may be exercised shall
be $.01 per Share (the “Warrant Price”).

       

      (c)  Method of Exercise;
Payment.   The stock purchase right represented by this
Warrant may be exercised by the Holder only as to all Shares and not partially,
at any time on or before the Maturity Date, as defined in a Subordinated
Convertible Debenture of even date herewith, issued to the Holder in connection
with the loan by the Holder of funds to the Company (“Debenture”), by the
surrender of this Warrant, and a written Notice of Exercise at the principal
office of the Company and by the payment to the Company, by cash or bank check,
by wire transfer to an account designated by the Company (a “Wire Transfer”), or
by the cancellation by the Holder of indebtedness or other obligations of the
Company to the Holder of an amount equal to the Warrant Price multiplied by the
number of Shares then being purchased.  The person or persons in whose
name(s) any certificate(s) representing shares of Common Stock shall be issuable
upon exercise of this Warrant shall be deemed to have become the holder(s) of
record of, and shall be treated for all purposes as the record holder(s) of, the
shares represented thereby (and such shares shall be deemed to have been issued)
immediately prior to the close of business on the date or dates upon which this
Warrant is exercised.  In the event of the exercise of the rights
represented by this Warrant, certificates for the shares of stock so purchased
shall be delivered to the Holder by the Company at the Company’s expense as soon
as possible and in any event within thirty (30) days after such
exercise.

       

      (d)  Exercise of Debenture in
Lieu of Conversion.  This Warrant has been issued to the Holder
in connection with the Debenture.  Pursuant to the terms of the
Debenture, the Holder has the right to convert all of the Debenture into
Preferred Stock of the Company, which conversion will be in lieu of the right of Holder
to exercise this Warrant.  In the event of any such conversion, the
Holder will be required to surrender this Warrant to the Company and this
Warrant will be
cancelled in its entirety.  Further, pursuant to the terms of
the Debenture, in the event of the exercise of this Warrant by the Holder, the
convertibility feature of the Debenture shall lapse, and if requested by the
Company, at the time this Warrant is surrendered, the Holder will also surrender
the Debenture, in exchange for a debenture which is identical in all respects to
the Debenture, except for conversion rights.

    

     

    2.  Stock Fully Paid;
Reservation of Shares.  All Shares issued upon the exercise of
the rights represented by this Warrant will, upon issuance pursuant to the terms
and conditions herein, be duly authorized, validly issued, fully paid and
nonassessable, and free from all taxes, liens and charges with respect to the
issuance thereof.  During the period within which the rights
represented by this Warrant may be exercised, the Company will at all times have
authorized, and reserved for the purpose of the issue upon exercise of the
purchase rights evidenced by this Warrant, a sufficient number of shares of its
Common Stock to provide for the exercise of the rights represented by this
Warrant.

     

    3.  Subdivision or Combination
of Shares.  If the Company at any time while this Warrant
remains outstanding and unexpired shall split, subdivide or combine the
securities as to which purchase rights under this Warrant exist, into a
different number of securities of the same class, the number of shares covered
by this Warrant shall be proportionately decreased in the case of a split or
subdivision or increased in the case of a combination, effective at the close of
business on the date the subdivision or combination becomes
effective.

     

    
      
        
        

      

      
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    4.  Rights.  The
rights applicable to the Shares of Common Stock purchasable hereunder are set
forth in the Company’s Certificate of Incorporation, as amended through the Date
of Grant, a true and complete copy of which has been supplied to the holder of
this Warrant, and as it may be later amended.  The Company shall
promptly provide the holder hereof with any restatement, amendment, modification
or waiver of the Certificate of Incorporation promptly after the same has been
made.

     

    5.  Rights as Stockholders;
Information.  No holder of this Warrant, as such, shall be
entitled to vote or receive dividends or be deemed the holder of Common Stock or
any other securities of the Company which may at any time be issuable on the
exercise hereof for any purpose, nor shall any provision contained herein be
construed to confer upon the holder of this Warrant, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to receive notice of meetings, or to receive dividends or subscription rights
or otherwise until this Warrant shall have been exercised and the Shares
purchasable upon the exercise hereof shall have become deliverable, as provided
herein.

     

    6.  Mergers.  The
Company shall provide the holder of this Warrant with at least thirty (30) days’
notice of the terms and conditions of any of the following potential
transactions: (i) the sale, lease, exchange, conveyance or other disposition of
all or substantially all of the Company’s property or business, or (ii) its
merger into or consolidation with any other corporation (other than a
wholly-owned subsidiary of the Company), or any transaction (including a merger
or other reorganization) or series of related transactions, in which more than
50% of the voting power of the Company is transferred.

     

    7.  Modification and
Waiver.  This Warrant and any provision hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of the same is sought.

     

    8.  Notices.  Any
notice, request, communication or other document required or permitted to be
given or delivered to the holder hereof or the Company shall be delivered, or
shall be sent by certified or registered mail, postage prepaid, to each such
holder at its address as shown on the books of the Company or to the Company at
the address indicated therefor on the signature page of this
Warrant.

     

    9.  Descriptive
Headings.  The descriptive headings of the several paragraphs
of this Warrant are inserted for convenience only and do not constitute a part
of this Warrant.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    10.  Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Oklahoma without regard to its conflicts of law
principles.

     

    11.  Remedies.  In
case any one or more of the covenants and agreements contained in this Warrant
shall have been breached, the holders hereof (in the case of a breach by the
Company), or the Company (in the case of a breach by a holder), may proceed to
protect and enforce their or its rights either by suit in equity and/or by
action at law, including, but not limited to, an action for damages as a result
of any such breach and/or an action for specific performance of any such
covenant or agreement contained in this Warrant.  In the event an
action or proceeding is brought to enforce any provision of this Warrant, the
prevailing party shall be entitled to recover its reasonable attorney’s fees and
costs from the other party.

     

    12.  Severability.  The
invalidity or unenforceability of any provision of this Warrant in any
jurisdiction shall not affect the validity or enforceability of such provision
in any other jurisdiction, or affect any other provision of this Warrant, which
shall remain in full force and effect.

     

    13.  Entire
Agreement.  This Warrant constitutes the entire agreement
between the parties pertaining to the subject matter contained in it and
supersedes all prior and contemporaneous agreements, representations, and
undertakings of the parties, whether oral or written, with respect to such
subject matter.

     

    HQHealthQuest Medical
& Wellness Centers,
Ltd.

    


    


    


    By
_________________________

    Stephen
H. M. Swift,

    President

    


    5158 Oak
Leaf Drive

    Tulsa,
Oklahoma  74131-2653

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
B TO DEBENTURE

    HQHealthQuest Medical & Wellness
Centers,
Ltd.

     

    CONVERSION
NOTICE

    


    (To be executed by the Holder in
order to convert the $______________ Convertible Subordinated Debenture issued
by HQHealthQuest Medical
& Wellness Centers, Ltd., on December __, 2006 [the
“Debenture”])

     

    The
undersigned hereby irrevocably elects to convert $
_____________________________, evidencing the entire principal amount and
accrued interest of the above Debenture, into shares of Preferred Stock of
HQHealthQuest Medical & Wellness Centers, Ltd., according to the conditions
stated therein, as of the conversion date written below.

     

    
      	
              Conversion
      Date:

            	 
      	
                

            
	 
      	 
      	 
      
	
              Amount
      to be converted:

            	
              $

            	
                

            
	 
      	 
      	 
      
	
              Conversion
      Price:

            	
              $

            	 
      
	 
      	 
      	 
      
	
              Number
      of shares of Preferred Stock to be issued:

            	 
      	 
      
	 
      	
              $

            	 
      


    

     

    
      	
              Please
      issue the shares of Preferred Stock in the following name and to the
      following address:

            


    

     

    
      	
              Issue
      to:

            	
              ________________________________

              ________________________________

            
	 
      	 
      
	
              Authorized
      Signature:

            	 
      
	 
      	 
      
	
              Name:

            	 
      
	 
      	 
      
	
              Title: