GB Sciences (GBLX) DEF 14A Definitive proxy

DIABETIC TREATMENT CENTERS OF AMERICA, INC.

975 EAST 5400 SOUTH, SUITE 100

SALT LAKE CITY, UTAH 84117

STATEMENT

Relating to the Annual Meeting of

Stockholders to be held August 11, 2005

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrantx Filed by a Party other than the Registrant¨

¨ Preliminary Proxy Statement

¨ Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)(2))

x  Definitive Proxy Statement

¨ Definitive Additional Materials

¨ Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12

DIABETIC TREATMENT CENTERS OF AMERICA, INC.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

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¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11

1)  Title of each class securities to which transaction applies:

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¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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Diabetic Treatment Centers of America, Inc.

975 EAST 5400 SOUTH, SUITE 100

SALT LAKE CITY, UTAH 84117

Dear Stockholder:

You are cordially invited to attend the annual meeting of stockholders ofDiabetic Treatment Centers of America, Inc.. The annual meeting will be held at the Little America Hotel & Towers located at 500 South Main Street, Salt Lake City, Utah 84101 on the 11^th day of August 2005, at 1:30 P.M., and thereafter as it may from time to time be adjourned.

Details of the business to be conducted at the annual meeting are provided in the attached Notice of Annual Meeting and Proxy Statement.

YOUR VOTE IS IMPORTANT. Whether or not you attend the annual meeting, please complete, sign, date and promptly return the enclosed proxy card in the enclosed postage-paid envelope. If you decide to attend the annual meeting and vote in person, you may do so.

I would like to express my appreciation for your continued interest in the affairs of the Company.

We look forward to seeing you at the annual meeting.

Sincerely,

/s/ Arden Oliphant

Arden Oliphant

Chief Executive Officer

DIABETIC TREATMENT CENTERS OF AMERICA, INC

NOTICE OF

2005 ANNUAL MEETING OF STOCKHOLDERS

AND

PROXY STATEMENT

DATE:	August 11, 2005
TIME:	1:30 p.m.
PLACE:	Little America Hotel & Towers, 500 South Main Street, Salt Lake City, Utah 84101

Dear Stockholders:

At our annual meeting, we will ask you to:

1. Elect two (2) directors to the Board of Directors;

2. Ratify the selection of Tedder, James, Worden & Associates, P.A. as independent auditors for 2006;

3. Approve the 2005 Restricted Stock Plan

4. Transact any other business that may properly be presented at the annual meeting.

Record Date

If you were a stockholder of record at the close of business on July 08, 2005, you are entitled to notice of and to vote at the annual meeting. A list of stockholders entitled to vote at the meeting will be available during business hours for ten days prior to the annual meeting at our offices, 975 East 5400 South, Suite 100, Salt Lake City, Utah 84117, for examination by any stockholder for any purpose germane to the annual meeting.

Proof of Ownership

Attendance at the annual meeting will be limited to stockholders of record or their authorized representative by proxy. If your shares are held through an intermediary, such as a bank or broker, you must present proof of your ownership of Diabetic Treatment Centers of America, Inc shares at the annual meeting. Proof of ownership could include a proxy from the intermediary or a copy of your account statement, which confirms your beneficial ownership ofDiabetic Treatment Centers of America, Inc. Stockholders also must present a form of personal identification that includes a photograph in order to be admitted to the annual meeting.

By order of the Board of Directors,

/s/ Arden Oliphant

Arden Oliphant

Chief Executive Officer

June 30, 2005

TABLE OF CONTENTS

	PAGE
Information about the Annual Meeting and Voting	1
Information aboutDiabetic Treatment Centers of America, Inc	4
Information about Directors and Executive Officers	4
Proposal 1: Elect two (2) Directors	7
Proposal 2: Ratify Selection of Independent Auditors for 2006	8
Proposal 3: Approve the 2005 Restricted Stock Plan	10
Other Matters	12
Information about Stockholder Proposals	13
Annex A 2005 Restricted Stock Plan	A-1

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PROXY STATEMENT FOR DIABETIC TREATMENT CENTERS OF AMERICA, INC

2005 ANNUAL MEETING OF STOCKHOLDERS

INFORMATION ABOUT THE ANNUAL MEETING AND VOTING

Why Did You Send Me This Proxy Statement?

The Board of Directors ofDiabetic Treatment Centers of America, Incsent you this proxy statement and the enclosed proxy card because the board is soliciting your proxy to vote at the 2005 annual meeting of stockholders. This Proxy Statement summarizes the information you need to know to vote intelligently at the annual meeting. However, you do not need to attend the annual meeting to vote your shares. Instead, you may simply complete, sign and return the enclosed proxy card.

We will begin sending this Proxy Statement, the attached Notice of Annual Meeting and the enclosed proxy card on or about July 15, 2005 to all stockholders entitled to vote. Stockholders who owned the Company’s common stock at the close of business on July 8, 2005 are entitled to vote. On this record date, there were 23,249,759 shares of the Company’s common stock outstanding. Common stock is our only class of voting stock.

In this Proxy Statement, unless the context otherwise requires, “we,” “our,” “Diabetic Treatment Centers of America, Inc” “us,” the “Company” and similar expressions, refer to Diabetic Treatment Centers of America, Inc.

How Many Votes Do I Have?

Each share of our common stock that you own entitles you to one vote. The proxy card enclosed herewith indicates the number of the shares that you own.

How Do I Vote By Proxy?

Whether you plan to attend the annual meeting or not, we urge you to complete, sign and date the enclosed proxy card and to return it promptly in the postage-paid envelope provided. Returning the proxy card will not affect your right to attend the annual meeting and vote.

If you properly fill in your proxy card and send it to us in time to vote, your “proxy” (one of the individuals named on your proxy card) will vote your shares as you have directed. If you sign the proxy card but do not make specific choices, your proxy will vote your shares as recommended by the Board of Directors, as follows:

1. “FOR” the election of the two (2) nominees for director; and

2. “FOR” the ratification of Tedder, James, Worden & Associates as independent auditors for 2005; and

3. “FOR” the approval of the 2005 Restricted Stock Plan

If any other matter is presented, your proxy will vote in accordance with his or her best judgment. At the time this Proxy Statement went to press, we knew of no matters that needed to be acted on at the annual meeting, other than those discussed in this Proxy Statement.

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May I Revoke My Proxy?

If you give a proxy, you may revoke it at any time before it is exercised. You may revoke your proxy in any one of three ways:

1. You may send in anotherDiabetic Treatment Centers of America, Inc proxy with a later date;

2. You may notify Diabetic Treatment Centers of America in writing before the annual meeting that you have revoked your proxy; or

3. You may vote in person at the annual meeting.

How Do I Vote In Person?

If you plan to attend the annual meeting and vote in person, we will give you a ballot when you arrive. However, if your shares are held in the name of your broker, bank or other nominee, you must bring an account statement or letter from the nominee indicating that you were the beneficial owner of the shares on July 8, 2005, the record date for voting.

What Vote Is Required To Approve Each Proposal?

Proposal 1: Elect two (2) Directors

The two (2) nominees for director who receive the most votes (a “plurality” as required by Delaware law) will be elected. So, if you do not vote for a particular nominee, or you indicate, “withhold authority to vote” for a particular nominee on your proxy card, your vote will not count either “for” or “against” the nominee. A “broker non-vote” (i.e., when a broker does not have authority to vote on a specific issue) will also have no effect on the outcome since only a plurality of votes actually cast is required to elect a director.

Proposal 2: Ratify Selection of Auditors

The affirmative vote of a majority of the shares present in person or by proxy at the annual meeting is required to ratify the selection of independent auditors. Shares represented by proxy, which are marked “abstain,” will have the effect of a vote against Proposal 2. A broker non-vote will also have the effect of a vote against Proposal 2.

Proposal 3: Approval of the 2005 Restricted Stock Plan

The affirmative vote of a majority of the shares present in person or by proxy at the annual meeting is required to ratify the 2005 Restricted Stock Plan. Shares represented by proxy, which are marked “abstain,” will have the effect of a vote against Proposal 3. A broker non-vote will also have the effect of a vote against Proposal 3.

Quorum

A majority of the outstanding shares of common stock will constitute a quorum. Your broker is not entitled to vote on the proposals unless it receives instructions from you. Even if your broker does not vote your shares on the proposals, such broker non-votes will count as shares present for purposes of determining the presence or absence of a quorum for the transaction of business. Similarly, abstentions are also counted for determining if a quorum is present.

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Is Voting Confidential?

As a matter of policy, we hold proxies, ballots and voting tabulations that identify individual stockholders confidential. That information is available for examination only by the inspectors of election who are employees appointed to tabulate the votes. The identity of the vote of any stockholder is not disclosed except as may be necessary to meet legal requirements.

What are the Costs of Soliciting the Proxies?

We pay the cost of preparing, assembling and mailing this proxy-soliciting material. In addition to the use of the mail, proxies may be solicited personally, by telephone or telegraph or by officers and employees without additional compensation. We pay all costs of solicitation, including certain expenses of brokers and nominees who mail proxy material to their customers or principals.Diabetic Treatment Centers of America, Inc

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DIABETIC TREATMENT CENTERS OF AMERICA, INC

INFORMATION ABOUT DIABETIC TREATMENT CENTERS OF AMERICA, INC

Formerly Flagstick Ventures, Inc., Diabetic Treatment Centers of America, Inc. is a Delaware corporation incorporated on April 4, 2001 for the purpose of acquiring the wholesale golf equipment and accessories business previously conducted by our former president, Jeff Arthur Jones, as a sole proprietorship under the name “A and Z Golf.” We acquired the business from Mr. Jones, through our wholly owned subsidiary, A & Z Golf Corp., on June 5, 2001, in exchange for 10,000,000 shares of our common stock. Prior to that date, Mr. Jones conducted the business as a sole proprietorship.

Until August 2004, through our wholly-owned subsidiary, A & Z Golf Corp., we engaged primarily in the business of wholesale distribution of golf-related equipment, accessories and apparel. Our goal was to grow our wholesale customer base through client solicitation efforts and expanded product offerings. Our strategy was to avail ourselves of our management’s experience and relationships in the golf industry to grow our business as a wholesaler by expanding our supplier base and adding customers. Due to the low volume of purchases we made, it was difficult to improve our cost of sales.

Due to our inability to expand our wholesale golf operations, on July 1, 2004, the Board of Directors approved changing the name of the Company from Flagstick Ventures, Inc. to Diabetic Treatment Centers of America, Inc. to reflect our new business direction of owning and operating diabetic treatment centers. On August 4, 2004, the Company ceased operating in the wholesale golf industry to fully pursue its new direction of opening diabetic treatment centers.

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information as of May 15, 2005 with respect to the beneficial ownership of common stock by: (a) each shareholder known by the Company to be the beneficial owner of more than 5% of the Company common stock; (b) each director; (c) each executive officer named in the Summary Compensation Table; and (d) all executive officers and directors as a group.

Name of Beneficial Owner	Number of Shares of Common Stock Beneficially Owned	Percentage of Shares Beneficially Owned
Jeff Arthur Jones(1)	9,801,250	41.0	%
Arden Oliphant(1)	-0-	0	%
All directors and officers (1 person)	9,801,250	41.0	%

⁽¹⁾ The address of each of our officers listed in the table is in care of Diabetic Treatment Centers od America, Inc, 975 East 5400 South, Suite 100, Salt Lake City, Utah 84117.

INFORMATION ABOUT DIRECTORS AND EXECUTIVE OFFICERS

The Board of Directors

The Board of Directors oversees the business and affairs of the Company and monitors the performance of management. In accordance with corporate governance principles, the Board of Directors does not involve itself in day-to-day operations. The directors keep themselves informed through discussions with the Chairman of the Board, other key executives and our principal external advisors (legal counsel, outside auditors and other consultants), by reading reports and other materials that we send to them and by participating in board and committee meetings.

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The Committees of the Board

The Nominating Committee

We do not currently have a standing nominating audit and compensation committees. Although we are not required to appoint and maintain a standing nominating committee, our full board of directors has evaluated the nomination process and abides by certain principals in the nomination of director candidates. In particular, when evaluating potential director nominees, the board considers the following factors:

• The appropriate size of the Company’s Board of Directors;

• The needs of the Company with respect to the particular talents and experience of its directors;

• The knowledge, skills and experience of nominees, including experience in finance, administration or public service, in light of prevailing business conditions and the knowledge, skills and experience already possessed by other members of the board;

• Experience in political affairs;

• Experience with accounting rules and practices; and

• The desire to balance the benefit of continuity with the periodic injection of the fresh perspective provided by new board members.

The Company’s goal is to assemble a board of directors that brings together a variety of perspectives and skills derived from high quality business and professional experience. In doing so, the board will also consider candidates with appropriate non-business backgrounds.

Other than the foregoing, there are no stated minimum criteria for director nominees, although the board of directors may also consider such other factors as it may deem are in the best interests of the Company and its stockholders. The board does, however, believe it appropriate for members of the board to meet the criteria for an “audit committee financial expert” as defined by rules of the Securities and Exchange Commission. The Company also believes it appropriate for certain key members of the Company’s management to participate as members of the board from time to time.

The Board of Directors identifies nominees by first evaluating the current members of the board willing to continue in service. Current members of the board with skills and experience that are relevant to the Company’s business and who are willing to continue in service are considered for re-nomination. If any member of the board does not wish to continue in service or if the board decides not to re-nominate a member for re-election, the board then identifies the desired skills and experience of a new nominee in light of the criteria above. Current members of the board of directors are polled for suggestions as to individuals meeting the criteria described above. The board may also engage in research to identify qualified individuals. To date, the Company has not engaged third parties to identify or evaluate or assist in identifying potential nominees, although the Company reserves the right in the future to retain a third party search firm, if necessary.

Code of Ethics

The Company has adopted the Diabetic Treatment Centers of America, Inc . Code of Ethics (the “Code of Ethics”) which applies to our Chief Executive Officer, Chief Financial Officer and other finance organization employees. The Code of Ethics is publicly available on our website at www.dtcofamerica.com. If we make any substantive amendments to the Code of Ethics or grant to our Chief Executive Officer or Chief Financial Officer any waiver, including any implicit waiver, from a provision of the Code of Ethics, we will disclose the nature of such amendment or waiver on that website or in a report on Form 8-K.

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Stockholder Communications with the Board of Directors

Historically, the Company has not adopted a formal process for stockholder communications with the board. Nevertheless, every effort has been made to ensure that the board or individual directors, as applicable, hear the views of stockholders and that appropriate responses are provided to stockholders in a timely manner. Any matter intended for the board, or for any individual member or members of the board, should be directed to the Company’s Chief Executive Officer, Arden Oliphant, with a request to forward the same to the intended recipient. All such communications will be forwarded unopened.

The Executive Officers

Currently, our executive officers consist of: Mr. Arden Oliphant as Chief Executive Officer, President and Secretary, and Mr. Allan Woodlief as Chief Financial Officer. Mr. Olophant’s and Mr. Woodlief’s biographies are included in “Proposal 1: Elect two (2) Directors” below.

Section 16(a) Beneficial Ownership Reporting Compliance

Based solely upon a review of Forms 3, 4 and 5, and amendments to these forms furnished to us, their were no parties, who are subject to the reporting requirements of Section 16(a) of the Exchange Act, that either failed to file or were delinquent in filing all such required reports with respect to fiscal year 2005:

The Company has taken steps to educate its officers, directors and ten percent owners regarding their personal reporting obligations and has provided them with additional information to prevent further delinquent filings.

Executive Compensation

We did not have any other executive officers or other employees serving at the end of fiscal year 2005 whose total annual salary and bonus exceeded $100,000. The following table sets forth certain information regarding the compensation of our Chief Executive Officer for 2003, 2004 and 2005.

Summary Compensation Table

Name and Principal Position	Year	Annual Compensation			Long-Term Compensation Awards Restricted Stock Awards (1)	All Other Compensation
		Salary		Bonus
Arden Oliphant President, Chief Executive Officer, Secretary and Director	03/31/05	$	34,000	-0-	-0-	-0-
Jeff Jones Chief Executive Officer	03/31/05		-0-	-0-	-0-	-0-
	03/31/04	$	38,270	-0-	-0-	-0-
	03/31/03	$	39,813	-0-	-0-	-0-

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Certain Relationships and Related Transactions

EMPLOYMENT AGREEMENTS

We have entered into an employment agreement with Mr. Arden Oliphant, the Company’s Chief Executive Officer. Mr. Oliphant’s employment agreement was effective July 30, 2004 and expires on July 30, 2006. The agreement includes the payment of a base salary of $3,500 per month and up to 1,000,000 shares of restricted stock based upon performance goals defined in the agreement by the Board of Directors. Per the agreement, the base salary is adjusted to $5,000 per month from the date the clinic opens through the termination date of the agreement. To date, Mr. Oliphant has not met the any of the performance goals defined by his employment agreement and therefore has not been awarded any restricted shares of the Company’s common stock pursuant to the agreement.

PROPOSAL 1: ELECT TWO (2) DIRECTORS

The board has nominated two (2) directors for election at the annual meeting to serve until the 2006 annual meeting of Stockholders, until their successors are elected and qualified.

If any of the nominees should become unavailable, your shares will be voted for a board-approved substitute, or the board may reduce the number of directors to be elected. If any director resigns, dies or is otherwise unable to serve out his term, or the Board increases the number of directors, the board may fill the vacancy until the next annual meeting.

Nominees

The nominees’ names and certain information about each of them is set forth below.

Name	Age	Current Position	Director Since
Arden Oliphant(1)	48	Chief Executive Officer, Secretary and Director	2004
Allan Woodlief	47	Chief Financial Officer	—

⁽¹⁾ Member of the Audit Committee, the Executive Compensation Committee and Restricted Stock Plan Distribution Committee of the Board of Directors.

Arden Oliphant,Age 48– Mr. Oliphant has spent 25 years working in national and international business development, for a group of companies that includes start-up operations as well as established enterprises. With a sales and marketing focus, his skills have been accessed by Internet commerce, information and application-based organizations. He has actively managed local and national sales teams with as many as 3,500 people, supervised new product launch activities, assisted new companies with early rounds of financing, and worked with established organizations as a turn-around specialist.

From January 1997 through June 2004 Mr. Oliphant ran his own consulting company, Golfing 2000 LLC, directing sales and marketing for ecommerce companies and two other national companies. Many that developed into promising venture. With over 25 years of marketing and sales experience he provides leadership to young developing companies. The latest a was young software company that developed a online inventor and sales tracking system for the wireless communication industry.

Allan Woodlief, Age 47– Mr. Woodlief has served as our Chief Financial Officer since October 2004. Mr. Woodlief has served as President and Chief Financial Officer of Horizon Holding Corporation since December 2004. Prior to that Mr. Woodlief served as Vice President and Chief Financial Officer of Diabetic Treatment Centers of America, Inc. corporation, one of Horizon Holding Corporation’s wholly owned subsidiaries, since July 1999. Prior to joining LiquidGolf Corporation, Mr. Woodlief served for 14 years with IKON Office Solutions and recently served as Chief Financial Officer of the Florida division of IKON Office Solutions.

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THE BOARD RECOMMENDS THAT YOU VOTE “FOR”

THE ELECTION OF THE TWO (2) NOMINEES FOR DIRECTOR.

PROPOSAL 2: RATIFY SELECTION OF INDEPENDENT AUDITORS FOR 2006

We are asking you to ratify the Board’s selection of Tedder, James, Worden & Associates, P.A., certified public accountants, (Tedder) as independent auditors for 2006. The Audit Committee recommended the selection of Tedder, James to the Board of Directors. Tedder, James has served as the independent auditors of the Company since March 31, 2004.

A representative of Tedder, James, Worden & Associates, P.A. will attend the annual meeting with the opportunity to make a statement if he or she desires to do so, and shall be available to respond to appropriate questions.

There were no disagreements with Tedder on any matters, and we have authorized Tedder to respond fully to any inquiries of it.

THE BOARD RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION

OF THE SELECTION OF TEDDER, JAMES, WORDEN & ASSOCIATES, P.A.

AS INDEPENDENT AUDITORS FOR 2006.

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Independent Auditor Fees

The Company’s board of directors reviews and approves audit and permissible non-audit services performed by its independent accountants, as well as the fees charged for such services. In its review of non-audit service fees and its appointment of Tedder, James Worden & Associates, P.A. as the Company’s independent accountants, the board of directors considered whether the provision of such services is compatible with maintaining independence. All of the services provided and fees charged by Tedder, James Worden & Associates, P.A. in 2005 were approved by the board of directors. The following table presents fees for audit services rendered by Tedder, James, Worden & Associates, P.A. for the audit of the Company’s annual financial statements for the years ended March 31, 2004 and March 31, 2003 and fees billed for other services rendered by Tedder, James, Worden & Associates, P.A. during those periods.

	Fiscal 2004			Fiscal 2003
Audit Fees	$	9,000	(1)	$	18,200	(2)
Audit-Related Fees(3)		-0-			-0-
Tax Fees(4)		-0-			-0-
Subtotal	$	9,000		$	18,200
All other Fees(5)		-0-			-0-
Total	$	9,000		$	18,200

⁽¹⁾ Audit Fees – Audit fees billed to us by Tedder, James, Worden & Associates, P.A. for auditing our annual financial statements for 2004 and reviewing the financial statements included our annual report on Form 10-KSB.

⁽²⁾ Audit Fees – Audit fees paid by us to Richard M. Prinzi, Jr. for auditing our annual financial statements for 2003 and reviewing the financial statements included in our Quarterly Reports on Form 10-QSB.

⁽³⁾ Audit-Related Fees – There were no other fees billed by during the last two fiscal years for assurance and related services that were reasonably related to the performance of the audit or review of the Company’s financial statements and not reported under “Audit Fees” above.

⁽⁴⁾ Tax Fees – There were no tax fees billed during the last past fiscal year for professional services by Tedder, James, Worden & Associates, P.A or Richard M. Prinzi, Jr.

⁽⁵⁾ All Other Fees – There were no other fees billed by during the last two fiscal years for products and services provided.

Pre-Approval of Audit and Non-Audit Services of Independent Auditor

The Company’s policy is to pre-approve all audit and non-audit services provided by the independent auditors. These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for up to 12 months from the date of pre-approval and any pre-approval is detailed as to the particular service or category of services. The Audit Committee may delegate pre-approval authority to one or more of its members when expedition of services is necessary. The Audit Committee has determined that the provision of non-audit services by Tedder, James, Worden & Associates, P.A. is compatible with maintaining its independence.

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PROPOSAL 3: APPROVE THE 2005 RESTRICTED STOCK PLAN

Background and Purpose

On May 16, 2005, the Board of Directors adopted the Diabetic Treatment Centers of America,Inc. 2005 Restricted Stock Plan (the “2005 Plan”) and recommended that it be submitted to our stockholders for their approval at the Annual Meeting. The terms of the 2005 Plan provide for grants of restricted stock awards (collectively, “Awards”). The purpose of the 2005 Plan is to provide a means through which the Company and its subsidiaries may attract key personnel (collectively, the “Participants”) to enter into and remain in the employ of the Company and its subsidiaries, as well as to provide a means whereby those key persons upon whom the responsibilities of the successful administration and management of the Company rest, and whose present and potential contributions to the welfare of the Company are of importance, can acquire and maintain stock ownership, thereby strengthening their commitment to the welfare of the Company and promoting the mutuality of interests between Participants and the Company’s stockholders.

The effective date of the 2005 Plan is the date of the Annual Meeting (the “Effective Date”).

The following is a summary of certain principal features of the 2005 Plan. This summary is qualified in its entirety by reference to the complete text of the 2005 Plan. Stockholders are urged to read the actual text of the 2005 Plan in its entirety, the full text of which is set forth inAnnex A.

Shares Available for Awards

Under the 2005 Plan, the total number of shares of common stock that may be subject to the granting of Awards under the 2005 Plan during the term of the Plan shall be equal to 5,000,000 shares, plus the number of shares with respect to which Awards previously granted thereunder that are forfeited or cancelled or terminated.

The Board of Directors is authorized to adjust the limitations described in the preceding paragraph and is authorized to adjust outstanding Awards in the event that a dividend or other distribution (whether in cash, shares of common stock or other property), recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange or other similar corporate transaction or event affects the common stock so that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of participants.

Eligibility

The persons eligible to receive Awards under the 2005 Plan are the officers, directors, employees and independent contractors of the Company and its related entities. An employee on leave of absence may be considered as still in the employ of the Company or a related entity for purposes of eligibility for participation in the 2005 Plan.

Administration

The 2005 Plan is to be administered by a committee designated by the Board of Directors (the “Committee”), or if no Committee is so designated, then the Board of Directors shall administer 2005 Plan. Subject to the terms of the 2005 Plan, the Committee or the Board is authorized to select eligible persons to receive Awards, determine the number of Awards to be granted and the number of shares of common stock to which Awards will relate, specify times at which Awards will be vested, set other terms and conditions of Awards, prescribe forms of Award agreements, interpret and specify rules and regulations relating to the 2005 Plan, and make all other determinations that may be necessary or advisable for the administration of the 2005 Plan.

General Terms of Awards

The Committee or the Board is authorized to grant restricted stock awards. Restricted stock is a grant of shares of common stock which may not be sold or disposed of, and which may be forfeited in the event of certain terminations

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of employment, prior to the end of a restricted period specified by the Committee or the Board. A participant granted restricted stock generally has all of the rights of a stockholder of the Company, unless otherwise determined by the Committee or the Board.

The Committee or the Board may condition any payment relating to an Award on the withholding of taxes and may provide that a portion of any shares of common stock or other property to be distributed will be withheld (or previously acquired shares of common stock or other property be surrendered by the participant) to satisfy withholding and other tax obligations. Awards granted under the 2005 Plan generally may not be pledged or otherwise encumbered and are not transferable except by will or by the laws of descent and distribution, or to a designated beneficiary upon the participant’s death, except that the Committee or the Board may, in its discretion, permit transfers for estate planning or other purposes subject to any applicable restrictions under Rule 16b-3.

Awards under the 2005 Plan, are generally granted without a requirement that the participant pay consideration in the form of cash or property for the grant. The Committee or the Board may, however, grant Awards in exchange for other Awards under the 2005 Plan, awards under other Company plans, or other rights to payment from the Company.

The Committee or the Board may, in its discretion, accelerate the exercisability, the lapsing of restrictions or the expiration of deferral or vesting periods of any Award, and such accelerated exercisability, lapse, expiration and if so provided in the Award agreement, vesting shall occur automatically in the case of a “change in control” of the Company, as defined in the 2005 Plan. For purposes of the 2005 Plan, the term “change in control” generally means (a) approval by stockholders of any reorganization, merger or consolidation or other transaction or series of transactions if persons who were stockholders immediately prior to such reorganization, merger or consolidation or other transaction do not, immediately thereafter, own more than 50% of the combined voting power of the reorganized, merged or consolidated company’s then outstanding, voting securities, or a liquidation or dissolution of the Company or the sale of all or substantially all of the assets of the Company (unless the reorganization, merger, consolidation or other corporate transaction, liquidation, dissolution or sale is subsequently abandoned), or (b) a change in the composition of the Board such that the persons constituting the Board on the date the Award is granted (the “Incumbent Board”), and subsequent directors approved by the Incumbent Board (or approved by such subsequent directors), cease to constitute at least a majority of the Board, or (c) the acquisition by any person, entity or “group”, within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act, of more than 50% of either the then outstanding shares of the Company’s common stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors (hereinafter referred to as the ownership of a “Controlling Interest”) excluding, for this purpose, any acquisitions by (1) the Company or its subsidiaries, (2) any person, entity or “group” that as of the date on which the Award is granted owns beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act) of a Controlling Interest or (3) any employee benefit plan of the Company or its subsidiaries.

Amendment and Termination

The Board of Directors may amend, alter, suspend, discontinue or terminate the 2005 Plan, or the Committee’s authority to grant Awards without further stockholder approval, except stockholder approval must be obtained for any amendment or alteration if such approval is required by law or regulation or under the rules of any stock exchange or quotation system on which shares of common stock are then listed or quoted. Thus, stockholder approval may not necessarily be required for every amendment to the 2005 Plan, which might increase the cost of the 2005 Plan or alter the eligibility of persons to receive Awards. Unless earlier terminated by the Board, the 2005 Plan will terminate on the tenth anniversary of the Effective Date, or if earlier, at such time as no shares of common stock remain available for issuance under the 2005 Plan and the Company has no further rights or obligations with respect to outstanding Awards under the 2005 Plan.

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Federal Income Tax Consequences of Awards

The 2005 Plan is not qualified under the provisions of section 401(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and is not subject to any of the provisions of the Employee Retirement Income Security Act of 1974, as amended. Generally, the recipient of a stock award will recognize ordinary compensation income at the time the stock is received equal to the excess, if any, of the fair market value of the stock received over any amount paid by the recipient in exchange for the stock. If, however, the stock is non-vested when it is received under the 2005 Plan (e.g., if the employee is required to work for a period of time in order to have the right to sell the stock), the recipient generally will not recognize income until the stock becomes vested, at which time the recipient will recognize ordinary compensation income equal to the excess, if any, of the fair market value of the stock on the date it becomes vested over any amount paid by the recipient in exchange for the stock. A recipient may, however, file an election with the Internal Revenue Service, within thirty (30) days of his or her receipt of the stock award, to recognize ordinary compensation income, as of the date the recipient receives the award, equal to the excess, if any, of the fair market value of the stock on the date the award is granted over any amount paid by the recipient in exchange for the stock.

The recipient’s basis for the determination of gain or loss upon the subsequent disposition of shares acquired, as stock awards will be the amount paid for such shares plus any ordinary income recognized either when the stock is received or when the stock becomes vested. Upon the disposition of any stock received as a stock award under the 2005 Plan the difference between the sale price and the recipient’s basis in the shares will be treated as a capital gain or loss and generally will be characterized as long-term capital gain or loss if the shares have been held for more the one year from the date as of which he or she would be required to recognize any compensation income.

The information set forth above is a summary only and does not purport to be complete. In addition, the information is based upon current federal income tax rules and therefore is subject to change when those rules change. Moreover, because the tax consequences to any recipient may depend on his particular situation, each recipient should consult his tax adviser as to the federal, state, local and other tax consequences of the grant or exercise of an Award or the disposition of stock acquired as a result of an Award.

THE BOARD RECOMMENDS THAT YOU VOTE “FOR”

APPROVAL OF THE 2005 RESTRICTED STOCK PLAN

*    *    *    *    *

A COPY OF THE COMPANY’S ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED MARCH 31, 2005, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WITH FINANCIAL STATEMENTS AND THE SCHEDULES THERETO BUT WITHOUT ANY OTHER EXHIBITS, `WILL BE MAILED TO THE STOCKHOLDERS OF THE COMPANY UPON REQUEST AND WITHOUT CHARGE.

*    *    *    *    *

OTHER MATTERS

Management does not know of any matters to be presented for action at the meeting other than the election of directors, the ratification of the independent auditors, and the approval of the name change, as further described in the Notice of Annual Meeting of Stockholders. However, if any other matters come before the annual meeting, it is intended that the holders of the proxies will vote thereon in their discretion.

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INFORMATION ABOUT STOCKHOLDER PROPOSALS

Any stockholder who desires to present a proposal qualified for inclusion in our proxy materials relating to our 2005 annual meeting must forward the proposal to the Secretary at the address set forth below in time to arrive at our offices no later than June 1, 2005. This June 1, 2005 deadline will change in accordance with the rules and regulations promulgated by the Securities and Exchange Commission if the date of the 2005 annual meeting is 30 calendar days earlier or later than July 21, 2005. Stockholder proposals to be considered at the 2005 annual meeting but not to be included in the proxy statement for that meeting will be considered untimely after June 15, 2005. The notice provided by the stockholders must contain:

A complete and accurate description of the proposal;

• a statement that the stockholder (or the stockholder’s legal representative) intends to attend the meeting and present the proposal and that the stockholder intends to hold the record of securities entitled to vote at the meeting through the meeting date;

• the stockholder’s name and address and the number of shares of our voting securities that the stockholder holds of record and beneficially as of the notice date; and

• a complete and accurate description of any material interest of such stockholder in such proposal.

All stockholder proposals are subject to the requirements of the proxy rules adopted under the Securities Exchange Act of 1934, as amended (regardless of whether included in the proxy materials), and applicable Delaware law.

Our Bylaws do not provide separate or additional procedures for stockholders to nominate directors or to bring business before the stockholders.

If you wish to submit a stockholder proposal for the 2005 annual meeting of Stockholders or if you would like a copy of our Bylaws (without charge), please write toDiabetic Treatment Centers of America, Inc., 975 East 5400 South, Suite 100, Salt Lake City, Utah 84117.

By order of the Board of Directors,

/s/ Arden Oliphant

Arden Oliphant

Chief Executive Officer

June 30, 2005

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ANNEX A

DIABETIC TREATMENT CENTERS OF AMERICA, INC.

2005 RESTRICTED STOCK PLAN

1.Purpose. The purpose of the DIABETIC TREATMENT CENTERS OF AMERICA, INC. 2005 RESTRICTED STOCK PLAN (the “Plan”) is to advance the interest of DIABETIC TREATMENT CENTERS OF AMERICA, INC., a Delaware corporation (the “Company”) and Related Entities by providing an additional incentive to attract, retain and motivate qualified and competent Employees, Directors and Consultants upon whose efforts and judgment the success of the Company and its Related Entities are largely dependent, through the encouragement of stock ownership in the Company by such persons.

2.Definitions. As used herein, the following terms shall have the meaning indicated:

(a) “Board” shall mean the Board of Directors of the Company.

(b) “Cause” shall, with respect to any Recipient, have the equivalent meaning (or the same meaning as “cause” or “for cause”) set forth in any employment agreement between the Recipient and the Company or a Related Entity or, in the absence of any such agreement, such term shall mean (i) the failure by the Recipient to perform his or her duties as assigned by the Company (or a Related Entity) in a reasonable manner, (ii) any violation or breach by the Recipient of his or her employment agreement with the Company (or a Related Entity), if any, (iii) any violation or breach by the Recipient of his or her non-competition and/or non-disclosure agreement with the Company (or a Related Entity), if any, (iv) any act by the Recipient of dishonesty or bad faith with respect to the Company (or a Related Entity), (v) chronic addiction to alcohol, drugs or other similar substances affecting the Recipient’s work performance, or (vi) the commission by the Recipient of any act, misdemeanor, or crime reflecting unfavorably upon the Recipient or the Company or a Related Entity. The good faith determination by the Committee of whether the Recipient’s employment was terminated by the Company for “Cause” shall be final and binding for all purposes hereunder.

(c) “Change in Control” shall mean:

(i) Approval by the stockholders of the Company of (1) a reorganization, merger, consolidation or other form of corporate transaction or series of transactions, in each case, with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger or consolidation or other transaction do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated Company’s then outstanding voting securities in substantially the same proportions as their ownership immediately prior to such reorganization, or (2) a liquidation or dissolution of the Company, or (3) the sale of all or substantially all of the assets of the Company (unless such reorganization, merger, consolidation or other corporate transaction, liquidation, dissolution or sale is subsequently abandoned); OR

(ii) Individuals who, as of the Effective Date of this Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the Effective Date of this Plan whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the Directors of the Company) shall be, for purposes of this Plan, considered as though such person were a member of the Incumbent Board; OR

(iii) the acquisition (other than from the Company) by any person, entity or “group”, within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act, of more than 50% of either the then outstanding shares of the Company’s Common Stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors (hereinafter referred to as the ownership of a “Controlling Interest”) excluding, for this purpose, any acquisitions by (1) the Company, (2) any person, entity or “group” that as of the Date of Grant owns beneficial ownership (within the meaning

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of Rule 13d-3 promulgated under the Securities Exchange Act) of a Controlling Interest or (3) any employee benefit plan of the Company.

(d) “Code” shall mean the Internal Revenue Code of 1986, as amended.

(e) “Committee” shall mean the committee described inSection 11(a) hereof.

(f) “Common Stock” shall mean the Company’s Common Stock, par value $.001 per share.

(g) “Company” shall mean Diabetic Treatment Centers of America, Inc., a Delaware corporation, and its successors or assignees.

(h) “Consultant” shall mean any person (other than an Employee or a Director, solely with respect to such person’s capacity or services as a Director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity.

(i) “Continuous Service” shall mean the continuous service to the Company or a Related Entity, without interruption, of Recipient, in the Recipient’s capacity as an Employee, Director and/or a Consultant of the Company. Continuous Service shall not be considered interrupted (or to have ceased or terminated) in the case of (1) any approved leave of absence, (2) transfers among the Company, any Related Entity, or any successor thereto, so long as Recipient continues in his capacity as an Employee, Director or Consultant thereof, or (3) any change in status (e.g., from Employee to Director, from Employee to Consultant, etc.), if and so long as (x) the individual remains in the service of the Company or a Related Entity in any capacity of Employee, Director or Consultant (except as otherwise provided herein), and (y) which change in status is approved in writing by the Company in its sole discretion (with an express acknowledgement that such change in status continues, and does not cease or terminate, “Continuous Service” for purposes of this Agreement). An approved leave of absence shall include sick leave, military leave or any other authorized personal leave approved by the Company in writing.

(j) “Date of Grant” shall mean the date on which the Committee grants to the Recipient shares of Restricted Stock pursuant to this Plan, as set forth in the applicable Restricted Stock Agreement.

(k) “Director” shall mean a member of the Board or the board of directors of any Related Entity.

(l) “Disability” shall mean the Recipient’s inability to perform his or her duties for the Company for one hundred eighty (180) days in any twelve (12) month period as a result of mental or physical incapacity, illness or disability.

(m) “Effective Date” shall mean the date on which the Company’s stockholders approve the Plan at a meeting to be held on July 21, 2005.

(n) “Employee” shall mean any person, including an Officer or Director, who is an employee of the Company or any Related Entity. The payment of a Director’s normal compensation and fee (as applicable to all Directors) by the Company or a Related Entity shall not be sufficient to constitute “employment” by, or to cause such person to be an “Employee” of, the Company.

(o) “Officer” shall mean the Company’s Chairman of the Board, President, Chief Executive Officer, principal financial officer, principal accounting officer, any vice-president of the Company, any other officer who performs a policy-making function, or any other person who performs similar policy-making functions for the Company. As used in this paragraph, the phrase “policy-making function” does not include policy-making functions that are not significant. If pursuant to Item 401(b) of Regulation S-K (17 C.F.R. § 229.401(b)) the Company identifies a person as an “executive officer,” the person so identified shall be deemed an “Officer” even though such person may not otherwise be an “Officer” pursuant to the foregoing provisions of this paragraph.

(p) “Parent” shall mean any corporation (other than the Company), whether now or hereafter existing, (i) which owns capital stock possessing 50% or more of the total combined voting power of all classes of capital stock of the Company, and/or (ii) in an unbroken chain of corporations ending with the Company, if each of the corporations in the chain

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(other than the Company) owns stock possessing 50% or more of the combined voting power of all classes of capital stock in one of the other corporations in the chain.

(q) “Plan” shall mean this Diabetic Treatment Centers of America, Inc. 2005 Restricted Stock Plan.

(r) “Recipient” shall mean any Employee, Director or Consultant who is awarded a grant of Shares pursuant to this Plan, or any individual who succeeds to the rights hereunder of such Employee, Director or Consultant in accordance with this Plan and any applicable Restricted Stock Agreement.

(s) “Related Entity” shall mean any Parent or Subsidiary, and any business, corporation, partnership, limited liability company, trust or other entity in which the Company, a Parent or a Subsidiary holds a substantial ownership interest, directly or indirectly.

(t) “Restricted Stock” shall mean Shares issued pursuant to this Plan.

(u) “Restricted Stock Agreement” shall mean the agreement entered into between the Company and a Recipient, pursuant toSection 4(b) hereof, which agreement evidences the award of Shares pursuant to the Plan and which sets forth certain terms, provisions, conditions and restrictions relating to the grant of Shares hereunder and thereunder.

(v) “Securities Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

(w) “Securities Act” means the Securities Act of 1933, as amended.

(x) “Share” shall mean a share of common stock of the Company.

(y) “Subsidiary” shall mean any corporation (other than the Company) in any unbroken chain of corporations beginning with the Company if, at the time of the granting of the Option, each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

(z) “Transfer” shall mean any sale, transfer, encumbrance, gift, donation, assignment, pledge, hypothecation, or other disposition, whether similar or dissimilar to those previously enumerated, whether voluntary or involuntary, and including, but not limited to, any disposition by operation of law, by court order, by judicial process, or by foreclosure, levy or attachment.

(aa) “Vested Shares” shall mean the portion of the Restricted Stock granted pursuant to the Plan in which the Recipient is vested pursuant toSection 5(a) hereof and the Restricted Stock Agreement pursuant to which the Restricted Stock was granted (and any stock dividends declared with respect thereto).

(bb) “Voting Agreement” shall mean those voting agreements and voting trusts that the Committee may require the Recipient to enter into as a condition to the issuance of Shares under this Plan pursuant tosubsection 6(b)(iii) hereof.

3.Available Shares of Restricted Stock. The Committee may from time to time grant to one or more Recipients up to an aggregate of Five Million (5,000,000) shares of restricted common stock from the Company’s authorized and unissued Shares (collectively the “Restricted Stock”). If any Shares of Restricted Stock granted under the Plan are forfeited or surrendered, such forfeited or surrendered Shares shall be available for future grants by the Committee under this Plan.

4. Conditions for Grant of Restricted Stock.

(a) Each grant of shares of Restricted Stock shall be evidenced by a Restricted Stock Agreement that may contain any term deemed necessary or desirable by the Committee, provided such terms are not inconsistent with this Plan or any applicable law. Recipients shall be those persons selected by the Committee from the class of all regular Employees, Directors and Consultants of the Company.

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(b) In granting shares of Restricted Stock, the Committee shall take into consideration the contribution the Recipient has made to the success of the Company and such other factors as the Committee shall determine. The Committee shall also have the authority to consult with and receive recommendations from officers and other personnel of the Company with regard to these matters. The Committee may from time to time in granting shares of Restricted Stock under the Plan prescribe such other terms and conditions concerning such shares as it deems appropriate, including, without limitation, (i) the amount, if any, to be paid by the Recipient for the Restricted Stock, (ii) the date or dates on which the Restricted Stock becomes vested, and (iii) the events upon which the Recipient may be deemed to have forfeited his right, title or interest, if any, in the Shares, provided that such terms and conditions are not more favorable to a Recipient than those expressly permitted herein.

(c) The shares of Restricted Stock granted to a Recipient under this Plan shall be in addition to his or her regular salary, pension, life insurance or other benefits related to the Recipient’s employment with the Company. Neither the Plan nor any Restricted Stock grant under the Plan shall confer upon any person any right to employment or service, or continuance of employment or service with the Company.

5. Vesting of Restricted Shares.

(a) The shares of Restricted Stock granted to a Recipient pursuant to this Plan shall vest and thus become Vested Shares at such times and in such a manner as determined by the Committee at the time of the grant, and as set forth in the Restricted Stock Agreement to be entered into by and between the Company and the Recipient.

(b) The Committee shall be authorized to accelerate the vesting of any Restricted Stock under this Plan or the Restricted Stock Agreement, at such times and upon such terms and conditions as the Committee shall deem advisable.

6. Issuance of Restricted Shares

(a) Upon the execution and delivery of a Restricted Stock Agreement, the Company shall be deemed to have issued and delivered to the Recipient, and the Recipient party thereto shall be deemed to have received, the number of Shares specified under such Restricted Stock Agreement, which shares shall have all such rights, benefits and entitlements, and be subject to all terms, provisions, conditions and restrictions, as are provided for pursuant to such Restricted Stock Agreement and this Plan.

(b) As a condition to any issuance of Shares pursuant to this Plan, the Committee may require such agreements or undertakings as the Committee may deem necessary or advisable to facilitate compliance with any applicable law or regulation including, but not limited to, the following:

(i) a representation and warranty by the Recipient to the Company, at the Date of Grant, that he is acquiring the Shares to be issued to him for investment and not with a view to, or for sale in connection with, the distribution of any such Shares;

(ii) a representation, warranty and/or agreement to be bound by any legends endorsed upon the certificate(s) for such Shares that are, in the opinion of the Committee, necessary or appropriate to facilitate compliance with the provisions of any securities laws deemed by the Committee to be applicable to the issuance and transfer of such Shares; and

(iii) a representation, warranty and/or agreement to be bound by any other agreement to be entered into with respect to such Shares that are, in the opinion of the Committee, deemed to be necessary or appropriate, including, without limitation, a Voting Agreement and/or a stockholders agreement.

7. Rights as to Shares.

(a) A Recipient to whom Shares of Restricted Stock have been granted under this Plan shall have all the rights of a holder of common stock of the Company with respect to the Shares awarded hereunder (regardless of the extent to which such Shares are vested), including, without limitation, (i) the right to receive dividends with respect to such Shares, (ii) the right to vote such Shares, and (iii) the rights available to all holders of Shares of the Company upon any merger, consolidation, reorganization, liquidation or dissolution, stock split-up, stock dividend or recapitalization undertaken by the

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Company;provided,however, that all of such rights shall be subject to the terms, provisions, conditions and restrictions set forth in (x) this Plan; (y) the applicable Restricted Stock Agreement, and (z) any other applicable agreement including, without limitation, a Voting Agreement and/or a stockholders agreement. Any shares issued to the Recipient as a dividend with respect to Restricted Stock shall have the same status and bear the same legend as the Restricted Stock and shall be held by the Company, if the Restricted Stock is being so held unless otherwise determined by the Committee.

(b) Notwithstanding any other term or provision hereof, once the Shares of Restricted Stock granted to a Recipient hereunder have become vested in accordance with the terms of this Plan (and the applicable Restricted Stock Agreement), the holder of such Vested Shares shall have all the rights and privileges of a holder of shares of Common Stock of the Company (not otherwise granted inSection 7(a) of this Plan), and such Vested Shares shall no longer be subject to or bound or governed by this Plan (or the applicable Restricted Stock Agreement). The Vested Shares, however, may still be subject to the terms and conditions of an applicable agreement such as a Voting Agreement or stockholders agreement.

(c) Notwithstanding any term or provision of this Plan to the contrary, the existence of this Plan, or of any outstanding Shares awarded hereunder, shall not affect in any manner the right, power or authority of the Company to make, authorize or consummate: (i) any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business; (ii) any merger, share exchange or consolidation by or of the Company; (iii) any issue by the Company of debt securities, or preferred or preference stock, that would rank prior to or on parity with the Shares; (iv) the dissolution or liquidation of the Company; (v) any sale, transfer or assignment of all or any part of the stock, assets or business of the Company; or (vi) any other corporate transaction, act or proceeding (whether of a similar character or otherwise).

8.Transferability. Unless otherwise provided in the Restricted Stock Agreement, the Shares are not transferable otherwise than by will or the laws of descent and distribution. Each and every stock certificate representing Shares issued to a Recipient shall bear such restrictive legends as are necessary or appropriate to reflect restrictions on transferability or to comply with the provisions of any securities law or other restriction applicable to the issuance of the Shares, together with such other legend(s) as the Committee shall in its sole discretion deem appropriate. The Company is under no obligation to register the Shares under applicable federal or state securities laws (the “Securities Laws”); before a Recipient may transfer any Shares which become Vested Shares hereunder such Shares must be either registered, or exempt from registration, under such laws.

9. Restrictions.

(a) The Shares granted to the Recipient pursuant to this Plan shall not be subject to a Transfer without complying with the terms, provisions and conditions of the Plan and the applicable Restricted Stock Agreement for such period of time as determined by the Committee and set forth in the Restricted Stock Agreement. Any Transfer or attempted Transfer not in compliance with thissubsection 9(a), or any other applicable provision or restriction of this Plan, such Restricted Stock Agreement shall be null, void and of no effect, and shall not be effected upon the stock transfer records of the Company.

(b) Each Recipient shall be required, as a condition to the grant of Shares pursuant to this Plan, to acknowledge and agree that the Committee may, if it chooses in its sole and absolute discretion, permit the Transfer of the Shares out of such Recipient’s name, which Transfer may be conditioned upon any condition(s) the Committee may deem to impose, but only when such request for transfer is accompanied by an opinion, satisfactory to the Company, of counsel to the effect that the proposed transfer (i) is being effected in accordance with, and does not violate, an applicable exemption from registration under the Securities Laws, and (ii) does not violate or conflict with any term or provision of this Plan or the applicable Restricted Stock Agreement.

(c) Each Recipient must agree to indemnify and hold harmless the Company and its directors, officers, employees, agents and controlling stockholders, and their respective heirs, representatives, administrators, successors and assigns, from, against and in respect of any and all liabilities, claims, causes, damages, deficiencies, costs, expenses or losses arising out of or resulting from (i) any transfer of Shares by him in violation of any Securities Laws, or (ii) any breach by such Recipient of any representation, warranty, covenant or agreement contained in this Plan or in the applicable Restricted Stock Agreement.

10.Adjustment of Shares. Subject to any required action by the stockholders of the Company, the number of Shares covered by this Plan and any Restricted Stock Agreement, and the aggregate number of shares which have been authorized for award and issuance hereunder and under any Restricted Stock Agreement, shall be proportionately adjusted for

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any increase or decrease in the number of issued Shares resulting from a stock dividend or through any recapitalization, reclassification, stock split-up, combination or Company exchange of shares (other than any such exchange or issuance of Shares through which capital stock is issued to effect an acquisition of another business or entity). Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of Shares subject to this Plan.

11. Administration of the Plan.

(a) The Plan shall be administered by the Compensation Committee of the Board of the Company (the “Committee”) consisting of such number of members appointed from time to time by the Board, or if no Committee is appointed, then the Plan shall be administered by the Board, which shall then be deemed the “Committee” for purposes of this Plan.

(b) Subject to the limitations ofSection 12 hereof, the Committee, from time to time, may adopt rules and regulations for carrying out the purposes of the Plan. The determinations by the Committee, and the interpretation and construction of any provision of the Plan or any Restricted Stock Agreement by the Committee, shall be final and conclusive.

(c) Any and all decisions or determinations of the Committee shall be made either (i) by a majority vote of the members of the Committee at a meeting or (ii) without a meeting by the unanimous written approval of the members of the Committee.

12. Interpretation.

(a) At any time that any shares of the Common Stock of the Company shall be registered underSection 12 of the Securities Exchange Act, it is the intent of the Company that the Plan comply in all respects with Rule 16b-3 promulgated under the Securities Exchange Act (“Rule 16b-3”), and any ambiguities or inconsistencies in construction of the Plan shall be interpreted to give effect to such intention, and if any provision of the Plan is found not to be in compliance with Rule 16b-3, such provision shall be deemed null and void to the extent required to permit the Plan to comply with Rule 16b-3. The Committee may from time to time adopt rules and regulations under, and amend, the Plan in furtherance of the intent of the foregoing.

(b) If any provision of this Plan should be held invalid, illegal or unenforceable for any reason, such determination shall not affect the remaining provisions hereof, but instead this Plan shall be construed and enforced as if such provision had never been included in this Plan.

(c) This Plan shall be governed by and construed in accordance with the laws of the State of Florida.

(d) Headings contained in this Plan are for convenience only and shall in no manner be construed as part of this Plan.

(e) Any reference to the masculine, feminine, or neuter gender shall be a reference to such other gender as is appropriate.

(f) Inasmuch as the Shares may not be readily purchased or sold in the open market and the Company and the Recipients desire to impose significant restrictions on the transfer of such Shares, irreparable damage will result in the event that the restrictions set forth in this Plan or in any Restricted Stock Agreement are not specifically enforced and, therefore, any damages available at law for a breach of the restrictions set forth in this Plan would not be an adequate remedy. Therefore, the terms, provisions, conditions and restrictions of this Plan (and the applicable Restricted Stock Agreement) and the obligations of the Company and the Recipient hereunder (and thereunder) shall be enforceable in a court of equity, or other tribunal having jurisdiction, by a decree of specific performance, and appropriate injunctive relief may be applied for and awarded in connection therewith and the parties further agree that no bond of the Company shall be required in connection therewith.

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13.No Right to Continued Employment or Engagement. Nothing in this Plan shall confer upon any Recipient, or give rise to any inference regarding, any right to or claim for employment or service, or continued employment or service, or to any rights incident or related to any such employment with or services to the Company; nor shall it interfere in any way with any Recipient’s right to terminate his or her employment or services with the Company or any Related Entity at any time.

14.Successors/Assignees of Company. Any successor(s) or assignee(s) of the Company shall be obligated to assume any and all obligations of the Company under this Plan and under any Restricted Stock Agreements entered into pursuant to this Plan.

15.Amendment/Termination of Plan. The Committee, without approval of the Company’s stockholders, may at any time amend the terms or provisions of this Plan or terminate or suspend this Plan;provided,however, that any such amendment, termination or suspension shall not affect any Shares, or the terms or provisions of any grant of Shares (in accordance with the applicable Restricted Stock Agreement), awarded prior to such amendment, termination or suspension; and provided further, that no such amendment shall eliminate the requirement inSection 3 hereof that any Shares of Restricted Stock that are forfeited or surrendered pursuant to the Plan be reallocated among those Recipients who have received prior grants of Restricted Stock under this Plan. No Shares may be awarded while this Plan is suspended or after it is terminated.

16.Termination Date. The Plan shall terminate on the tenth anniversary of the Effective Date.

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DIABETIC TREATMENT CENTERS OF AMERICA, INC.

TO BE HELD ON AUGUST 11, 2005

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned stockholder of Diabetic Treatment Centers of America, Inc, (the “Company”) hereby constitutes and appoints Mr. Arden Oliphant as attorney and proxy, with the power to appoint a substitute, and hereby authorizes him to represent and vote, as designated below, all of the shares of common stock of the Company which the undersigned is entitled to vote at the annual meeting of stockholders of the Company to be held August 11, 2005, or at any and all adjournments or postponements thereof, with respect to the matters set forth below and described in the Notice of Annual Meeting of Stockholders and the Proxy Statement dated June 30, 2005.

Proposal 1:	To consider and act upon a proposal to elect five (5) directors to hold office for a one year term or until their successors are elected and qualified
	¨ FOR ELECTION OF ALL NOMINEES (except as shown below)
	¨ WITHHOLD AUTHORITY TO VOTE FOR ALL NOMINEES
	INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE THROUGH THE NOMINEE’S NAME BELOW:
	Arden Oliphant
	Allan Woodlief
Proposal 2:	To appoint Tedder, James, Worden & Associates, P.A. as independent auditors for 2006.
	¨ FOR APPOINTMENT    ¨ AGAINST APPOINTMENT    ¨ ABSTAIN
Proposal 3:	To approve the 2005 Restricted Stock Plan
	¨ FOR APPROVAL          ¨ AGAINST APPROVAL    ¨ ABSTAIN
Proposal 4:	In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any and all adjournments thereof.
	¨ AUTHORIZED TO VOTE    ¨ ABSTAIN

This proxy, when properly executed, will be voted in the manner directed herein by the undersigned stockholder(s). IF NO INDICATION IS MADE, THIS PROXY WILL BE VOTED “FOR” THE NOMINEES LISTED, FOR THE INDEPENDENT AUDITORS, FOR THE APPROVAL OF THE 2005 RESTRICTED STOCK PLAN, AND THE PROXY HOLDERS WILL VOTE ON ANY MATTER UNDER PROPOSAL NO. 4 IN THEIR DISCRETION AND IN THEIR BEST JUDGMENT.

SIGNATURE(S): (Please sign exactly as your name appears on the proxy. When shares are held by joint tenants, both should sign. When signing as attorney, executor, administrator, trustee or partner, please give full title as such. If a corporation, please sign in full corporate name by president or by other authorized officer. If a partnership, please sign in partnership name by authorized person.)

Date: _______________________________

Number of Shares: ____________________