UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549





FORM
10-K





o  ANNUAL REPORT
UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the
seven months ended July 31, 2009





x TRANSITION REPORT UNDER
SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the
transition period from January 1, 2009 to July 31, 2009





COMMISSION
FILE NUMBER 0-27889





ZURVITA
HOLDINGS, INC.


(Exact
Name of registrant as specified in its charter)





Delaware
            333-145898
            26-0531863(State
      or other jurisdiction of incorporation)
            (Commission
      File Number)
            (IRS
      Employer Identification No.)





800
Gessner


Houston, Texas
77024


(Address
of principal executive offices and Zip Code)





713-464-5002


(Registrant’s
telephone number, including area code)





Not
Applicable


(Former
name or former address since last report)





Securities
Registered Under Section 12(b) of the Exchange Act: None





Securities
Registered Pursuant to Section 12(g) of the Exchange Act: Common Stock, par
value $0.0001 per share.




Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.    Yes  o    No  x




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act.    Yes  o    No  x




Indicate
by check mark whether the Registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past
90 days.    Yes  x    No  o





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes o No o




Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will
not be contained, to the best of the Registrant’s knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.  o




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer or a smaller reporting company.
See definition of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):


Large accelerated filer
            
            o
            
            Accelerated filer
            
            oNon-accelerated
      filer
            
            o  (Do
      not check if a smaller reporting company)
            
            Smaller reporting company
            
            x




Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Securities Exchange Act of
1934).    Yes  o    No  x





The
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common stock was
last sold as of the last day of the registrants’ most recently completed second
fiscal quarter was $0.00.  No market value has been computed based
upon the fact that no active trading market had been established.





The
number of shares outstanding of each of the issuer’s classes of common stock as
of October 19, 2009: 56,440,000 shares of common stock, par value
$0.0001.




DOCUMENTS
INCORPORATED BY REFERENCE




None.
















ZURVITA
HOLDINGS, INC.





FORM
10-K


For
the Seven Months Ended July 31, 2009





TABLE
OF CONTENTS





PART
      I
            
            PAGE
      NO.ITEM
      1.
            DESCRIPTION
      OF BUSINESS.
            1ITEM
      1A.
            RISK
      FACTORS.
            6ITEM
      1B.
            UNRESOLVED
      STAFF COMMENTS.
            10ITEM
      2.
            PROPERTIES.
            10ITEM
      3.
            LEGAL
      PROCEEDINGS.
            10ITEM
      4.
            SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS.
            10PART
      IIITEM
      5.
            MARKET
      FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES.
            11ITEM
      6.
            SELECTED
      FINANCIAL DATA.
            11ITEM
      7.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS.
            11ITEM
      7A.
            QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
            19ITEM
      8.
            FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA.
            20ITEM
      9.
            CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE.
            20ITEM
      9A.
            CONTROLS
      AND PROCEDURES.
            20ITEM
      9B.
            OTHER
      INFORMATION.
            21PART
      IIIITEM
      10.
            DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
            22ITEM
      11.
            EXECUTIVE
      COMPENSATION.
            25ITEM
      12.
            SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
      STOCKHOLDER MATTERS.
            27ITEM
      13.
            CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE.
            29ITEM
      14.
            PRINCIPAL
      ACCOUNTANT FEES AND SERVICES.
            30ITEM
      15.
            EXHIBITS
      AND FINANCIAL STATEMENT SCHEDULES.
            31SIGNATURES
            32








i








PART
I







Forward-Looking
Statements




This
Transition Report on Form 10-K may contain statements which constitute
“forward-looking statements” within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended.  Generally,  words such as
“may,” “will,” “should,” “could,” “would,”  “anticipate,” “expect,”
“anticipate,” “believe,” “goal,” “plan,” “intend,” “estimate” “continue” or the negative of or
other variation on theseand similar other expressions and variations
thereof, if used, are intended to specifically identify forward-looking
statements. Those statements appear in a number of places in this Form 10-K and
in other places, and include statements regarding the intent, belief or current
expectations of the Company, its directors or its officers with respect to,
among other things, our future performance and operating results, our future
operating plans, our liquidity and capital resources and our legal
proceedings.We do
not undertake to update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise.




Forward-looking
statements are based on current expectations and involve risks and uncertainties
and our future results could differ significantly from those expressed or
implied by our forward-looking statements.   Many factors,
including those listed in “Item 1A. - Risk Factors” below, could cause our
actual consolidated results to differ materially from those expressed in any of
our forward-looking statements.








ITEM
1. DESCRIPTION OF BUSINESS





Overview





As used
in this transition report and unless otherwise indicated, “Red Sun” refers
to Red Sun Mining, Inc. and “Zurvita” refers to Zurvita, Inc., prior to the
consummation of the Share Exchange, the Repurchase, and the Private Placement,
as those terms are hereinafter defined. The terms “we,” “us,” our”, and the
“Company” refers to Zurvita Holdings, Inc “Zurvita Holdings” which includes all
wholly-owned subsidiaries.





Business
History





Red Sun
was incorporated in the State of Delaware on June 28, 2007, as a development
stage company to engage in the acquisition and exploration of mineral
properties.  Red Sun was a shell company.





Zurvita
was incorporated in the State of Delaware on January 25,
2008.   Prior to the consummation of a Share Exchange agreement,
Zurvita was a wholly-owned subsidiary of The Amacore Group, Inc.
(“Amacore”)





On July
30, 2009 (the “Closing Date”), Red Sun entered into a Share Exchange Agreement
(the “Share Exchange Agreement”) with Zurvita and the holders of all of the
issued and outstanding securities of Zurvita prior to the Closing Date (the
“Zurvita Securities Holders”), pursuant to which, among other things, the
Zurvita Securities Holders contributed all of their securities of Zurvita to Red
Sun in exchange for Red Sun’s issuance of 9.3 million shares of common stock of
Red Sun (the “Share Exchange”).





Prior to
the consummation of the Share Exchange, Matthew Taylor was Red
Sun’s President, Secretary, Treasurer, Chief Executive Officer, Chief
Financial Officer, Principal Accounting Officer and sole
Director.  Mr. Taylor owned 66.7 percent of its issued and outstanding
securities.





Pursuant
to the terms of the repurchase agreement (the “Repurchase Agreement”), Red Sun
repurchased all of Mr. Taylor’s shares of common stock for a total repurchase
price of $210 thousand. Immediately after the repurchase of these shares: (1)
the former shareholders of Zurvita received shares of common stock of Red Sun in
exchange for all of their shares of Zurvita, (2) Mr. Taylor appointed the
following individuals as directors and officers of the Company: Jay Shafer,
Chief Executive Officer and Director; Jason Post, Chief Financial Officer;
Richard Diamond, Director; Paul Morrison, Director; Christopher D. Phillips,
Director; and Guy Norberg, Director and (3) Mr. Taylor resigned from his Red Sun
officer positions and from the Red Sun board of directors.





Concurrent
with the closing of the Share Exchange Transaction, the Company entered into a
Securities Purchase Agreement (the “Purchase Agreement”) with an accredited
investor and closed a private placement offering pursuant to which it raised
gross proceeds of $1.75 million and, among other things, issued and sold
convertible preferred stock (the “Preferred Stock”) convertible into shares of
the Company’s common stock (“Conversion Shares”) at an initial conversion price
of $0.0625, subject to adjustment (the “Private Placement”).  The
Company completed the Private Placement pursuant to which it raised gross
proceeds of $1.75 million.




As a
result of the Share Exchange Transaction and the consummation of the
transactions pursuant to the Repurchase Agreement,  Red Sun
experienced a change in control and ceased to be a shell company. Zurvita became
the Company’s wholly-owned subsidiary and the former shareholders of Zurvita
became the owners of approximately 66 percent of the Company’s issued and
outstanding shares of common stock and 44 percent of the voting rights of total
equity securities outstanding (after giving effect to subsequent issuances of
common stock).  The combined entity elected to change its name from
Red Sun Mining, Inc. to Zurvita Holdings, Inc. while maintaining Red Sun’s
status as a SEC registrant and we are continuing the business plan of Zurvita
only.


1








Business
Strategy





The
Zurvita Holdings business strategy embraces the strength of direct sells
exemplified through the network marketing channel.  The business
strategy is designed to create a marketing and sales force by compensating
independent business owners (“Consultants”) of company products and services not
only for sales they personally generate, but also for the sales of other
Consultants who they introduced to the business, creating a sales organization
of Consultants and a hierarchy of multiple levels of
compensation.  The products and services and business opportunity are
usually marketed directly to consumers and potential business partners by means
of relationship referrals and word of mouth marketing.





Consultants
become associated with the Company in an independent contractor relationship and
receive remuneration for selling products and services and for expanding their
network of people doing the same by promoting the Zurvita Holdings business
opportunity.





Strategically,
the Zurvita Holdings business opportunity is built on service and technology
platforms whereby Consultants market products at many levels.  The
business opportunity is to create a Consultant sales organization that in turn
sponsors other motivated consultants.  At the core of this business
opportunity is the Company’s vision to create a business model where each
representative has an opportunity to make a living on a full-time basis and to
obtain long-term financial security through means of marketing products that
have demand in the market place that create long-term residual
income.





Zurvita
Holdings is positioned to market and sell products and services currently in
high demand in the marketplace.  Additionally, Zurvita Holdings sells
products and services through nationally recognized companies that offer
membership and/or subscription programs or services at competitive
prices.





Zurvita
Holdings has developed processes to dramatically increase performance
success:





Focus on Lead
Generation





Concurrent
with the closing of the Share Exchange, Zurvita Holdings entered into an
Advertising and Marketing Agreement with OmniReliant Holdings, Inc.,
(“OmniReliant”), pursuant to which Zurvita Holdings agreed to provide placement
of advertising for OmniReliant on its website and OmniReliant agreed to provide
the Company with certain marketing services.  The marketing services
to be provided by OmniReliant include the production of infomercials, video
production services, management of call centers, buying and fulfillment
services.  In consideration for such services, OmniReliant received an
aggregate of 15.2 million shares of the Company’s common stock.





Strengthen Brand
Recognition





National
and regional marketing efforts are administrated to support corporate and
“personal” branding initiatives.  Inherent to the network marketing
industry is the axiom that people don’t follow products or features, but rather
the people with whom they are building relationally.  Zurvita Holdings
not only invest resources promoting the corporate brand, but has developed a
technological platform allowing Consultants to build web based personal branded
sites enhancing their position as affiliate marketers of Zurvita Holdings
programs and services.





Increase Product and Service
Offerings





Zurvita
Holdings continues to explore the marketplace for new products and services
anticipated by consumers. The network marketing industry mandates a state of
continuous improvement by offering its Consultants and members products and
services that offer time, value and conveniences at cost competitive
prices.





Marketing





Zurvita
Holdings marketing strategies open new, innovative marketing and sales avenues
for Consultants to build income through expansion of their sales organization
and the residual benefits offered through the sale of product and
services.  The marketing strategy features unique components beyond
the traditional approach indicative of most network marketing
companies.





Media





The
agreement with OmniReliant brings strength and uniqueness to Zurvita Holdings’
overall marketing strategy.  The synergistic relationship brings the
strength of television production and national media placement to drive
prospects to the Zurvita Holdings business opportunity and to fuel interest in
Zurvita Holdings programs that are distributed as leads to thousands of
Consultants.  OmniReliant offers a host of products that create
additional product options for Zurvita Holdings


2





Technology





Zurvita
Holdings recognizes the Internet is a powerful platform for the network
marketer.  The highly social aspect of the Internet lends itself as a
natural marketing vehicle and opens new population of prospects
continuously.  Zurvita Holdings offers Consultants robust “back”
office support complimented with sales and marketing tools.





Training and
Support





The
success of an external marketing program is only as affective as the internal
marketing strategies to keep Consultants informed and
engaged.  Zurvita Holdings is committed to a variety of communication
initiatives that promote leadership and business
effectiveness.  Weekly telephone/webinar meetings as well as
informational seminars create opportunities to develop leaders and to promote
the business opportunity.  Two national conferences and regional
events further support Zurvita Holding’s training and development efforts of its
national sales force.







Products
and Services





Our
products consist of membership products and services and non-membership products
and services. Our products are sold directly to consumers through our network of
independent Consultants.





Our
principal products include the following:


3





Product
              Description
              Key
      FeaturesZurvita
      Protection
              Services
      that protects members against common legal issues and security
      concerns.
              Program
      offers legal assistance, tax preparation & counseling, distressed
      financial assistance, identity theft recovery services, credit repair
      services, roadside assistance and life event
counseling.Zurvita
      Health
              A
      discount medical program that combines benefits and services to help
      mitigate the cost of everyday healthcare needs.
              Program
      creates access to convenient and affordable discount medical programs.
      Services include access to a national network of board certified
      physicians providing telephone consultations to diagnose, recommend
      treatment and write short term non- narcotic prescriptions. Members
      further experience discounted medical services through network providers
      in vision, hearing, pharmacy, diagnostic, imaging and lab
      benefits.Zurvita
      Tech
              A
      membership plan that provides member discounted rates on computer and
      technology support needs.
              Program
      includes discounted prices on 24/7 remote technical support; nationwide
      onsite technical support and remote data backup and
  access.Zurvita
      Care Saver
              A
      membership program offering members cell phone concierge service and
      various retail shopping, dining, travel and recreational
      discounts.
              Program
      that includes restaurants, movie theatres, local retailers, daily
      services, personal care and pet care providers.Zurvita
      Choice
              The
      deregulation of electric and natural gas industries in certain states
      gives consumers the option to choose where they may purchase their
      energy.
              Program
      offers utility services (electric & natural gas where available) in
      Texas, Georgia, New York, Ohio, Indiana and Michigan. Service provider is
      MXenergy who is the largest independent retail provider in North American
      and is available in 39 markets. Members can lock in annual rates and
      effectively eliminate the volatile prices that makes managing energy
      expenses difficult.ZurTel
              ZurTel
      offers its customers several products and services in the ever expanding
      telecommunications industry.
              Program
      offers Voice over Internet Protocol as one of the most rapidly growing
      segments within the telecommunications industry. Additionally, Virtual
      Office services are designed to meet even the most demanding
      communications needs. ZurTel offers members access to all the major
      wireless companies for cellular service.Zurvita
      Mobile
              Zurvita
      gives customer choices and the ability to choose from all the major
      carriers for cellular service.
              Zurvita
      Mobile, through association with our fulfillment partner, is a fully
      authorized dealer for all the major carriers including AT&T Alltel
      Wireless, Sprint-Nextel, T-Mobile and Verizon Wireless. Members have the
      flexibility to choose cell phones and providers from one convenient online
      location.LocalAdlink,
      Powered by Zurvita
              Online
      Search directory that actively pushes Ads to an internal local advertising
      network as well as popular 3rd
      party search engines.
              Premiere
      placement on national search directory LocalAdLink.com. Organic results on
      high traffic websites. Strategic placement on internal Ad network. 3rd
      party placement on popular search engines; Google, Ask, Bing, Yahoo. A low
      cost leader in Online
Advertising.





Employees





As of
July 31, 2009, Zurvita Holdings had 10 full-time employees.





Customers





Our
customers mainly consist of individual consumers who purchase our products
and services through our network of independent marketing
representatives.  We also generate revenue as our independent
distributors pay the Company a fee to become marketing representatives and in
turn are provided access to various marketing tools and materials..





Competition





The
Company competes in the highly competitive direct-to-consumer industry which
consists of many different companies ranging from the small sole proprietors to
large multi-national domestic and foreign corporations who sell competing
products or who are competing for our membership’s consumer spending
dollars.  We expect our competition to continually change with the
advent of new products and services that compete for our current membership’s
consumer spending dollars or diminish the perceived value of our products and
services. There are many competitors who are more established than we are and
have greater financial and non-financial resources than we do.


4








Government
Regulation





We are
subject to federal, state and local laws, regulations, guidelines and
determinations, common laws, codes of conduct and other similar parameters that
directly and indirectly impact our business and methods of
operation.





State Discount Health Program
RegulationMany
states have enacted legislation concerning the operation and marketing of
discount health programs.  With respect to scope, some state health
program regulations apply to discounts on all health care products, while other
states’ regulations apply only to certain types of discount programs or
services.  For example, some regulations apply only to prescription
discounts.  In addition, some states require licensing and
registration of entities that provide discount health
programs.  Additional states are expected to enact such regulations in
the future.  States with such regulations currently in place may amend
existing regulations or enact new regulations which may severely restrict or
prohibit the sale of our products.  The Company monitors developments
or changes in the regulations in the states in which we operate or plan to
operate to allow compliance with the laws and regulations within those
states.  We may decide not to sell our products in states with
regulations we believe to be too burdensome or where compliance is too
costly.  In addition, such regulations may limit the products and
programs we may market and sell and the manner in which we market and sell our
products and programs.





The
discount programs we market are not insurance products and do not subject us to
insurance regulations.  However, some states have regulations that are
specific to discount plans as discussed above.  We may also receive
inquires from insurance regulators in various states in which we operate
requesting that we supply them with information about our
programs.  To date, these agencies have concurred with our view that
our health programs are not a form of insurance.  We can provide no
assurance that insurance commissioners in such states will continue to concur
with our view that our products are not a form of insurance and therefore are
not subject to insurance regulations.  In the future, states may adopt
regulations or enact legislation pursuant to which our programs may be deemed a
form of insurance, in which case we may become subject to insurance regulations
in such states.  Legislation has been introduced from time to time in
the U.S. Congress that could result in the federal government assuming a more
direct role in regulating insurance companies.  Compliance with such
regulations and laws may be costly and difficult.  Such regulations
may also preclude us from marketing some or all of our products and
programs.





Additional
governmental regulation or future interpretation of existing regulations may
increase the cost of compliance or materially and adversely affect the insurance
and/or non-insurance products and services offered by us and, as a result, our
results of operations.





Telemarketing Regulations -Our call center seats and relationships are, or may become, subject to
federal and state “do not call” laws and requirements.  Generally,
under these regulations, we are prohibited from calling any consumer whose
telephone number is listed in the national “do not call” registry, subject to
certain exceptions.  Violation of these regulations may result in
fines of up to $11,000 per violation, plus other penalties.





Product Claims and
Advertising Regulations -The Federal Trade Commission (FTC) and
certain states regulate advertising, product claims, and other consumer
matters.  The FTC and state regulators may institute enforcement
actions against companies for false and misleading advertising of consumer
products.  In addition, the FTC has increased its scrutiny of the use
of testimonials, similar to those used by us and representatives marketing our
membership programs. While we have not been the target of any FTC or state
regulatory enforcement actions, we can provide no assurance that:





·
            the
      FTC or state regulators will not question our advertising or other
      operations in the future;·
            a
      state will not interpret product claims presumptively valid under federal
      law as illegal under that state’s regulations; or·
            future
      FTC or state regulations or decisions will not restrict the permissible
      scope of such claims.





We are
also subject to the risk of claims by brokers and agents and their respective
customers who may file actions on their own behalf, as a class or otherwise, and
may file complaints with the FTC or state or local consumer affairs
offices.  These agencies may take action on their own initiative
against us for alleged advertising or product claim violations, or on a referral
from brokers, agents, customers or others.  Remedies sought in these
actions may include consent decrees and the refund of amounts paid by the
complaining brokers, agents or consumer, refunds to an entire class of brokers,
agents or customers, client refunds, or other damages, as well as changes in our
methods of doing business.  A complaint based on the practice of one
broker or agent, whether or not we authorized the practice, could result in an
order affecting some or all of the brokers and agents that we use in a
particular state.  Also, an order in one state could influence courts
or government agencies in other states considering similar
matters.  Proceedings resulting from these complaints could result in
significant defense costs, settlement payments or judgments and could have a
material adverse effect on us.


5





Insurance




The
Company significantly mitigates risk by contracting with other companies who
ultimately provide the insurance benefits that are embedded within certain of
the products we market.  The Company is not an insurance company, and
we do not retain any insurance risk associated with any of the products we
sell.




Corporate
Information




Zurvita
Holdings is a Delaware corporation formed on January 25,
2008.  Zurvita Holdings principal executive offices are located at 800
Gessner, Houston, Texas 77024.




ITEM
1A. RISK FACTORS





Our
business faces risks and uncertainties, including those discussed below and
elsewhere in this report. These factors represent risks and uncertainties that
could have a material adverse effect on our business, results of operations and
financial condition. Additional risks and uncertainties not presently known to
us or that we do not presently consider significant also may impair our business
or the trading price of our securities. Whenever the terms “our,” “we” and the
“Company” are used in this Risk Factors section, they refer to Red Sun or any of
its subsidiaries.





We
have a history of significant losses and may not be profitable in the future and
likely need significant additional outside funding to continue
operating.





We have a
history of net losses and had an accumulated deficit of approximately $9.8
million through July 31, 2009.  We have historically generated
significant net operating losses and negative operating cash
flows.  We believe that without significant equity and/or debt
investment from outside sources, we will not be able to sustain our planned
operations for the next 12 months.  Such additional capital may not be
available to us on acceptable terms or may not be available at
all.  You should not rely solely on the public market valuation of the
Company and the views of securities analysts and investors for assessing the
operational, business and financial success of the Company. Fluctuations in our
operating results or our inability to achieve profitability may cause volatility
in the price of our common stock in the public market.





Our
business is difficult to evaluate because it has a limited operating
history.





We have a
limited operating history and participate in a relatively new and rapidly
evolving market. The Company’s business has undergone significant transformation
during the past several years as a result of acquisitions, changes in the
services and products offered, changes in market conditions, changes in its
targeted membership, and are expected to continue to change for similar reasons.
We cannot assure you that our current business strategy will be successful in
the long term.  We have experienced significant losses since inception
and, even if demand from members exists, we cannot assure you that our business
will be successful.





The
Company is majority owned by shareholders who are considered related parties
and who will be able to make important decisions about our business and
capital structure.





Related
parties own approximately 93% of our outstanding common stock and
approximately 95% of the voting power of all equity
securities.  Related parties collective interest in exercising
control over us and our business may conflict with the interests of our other
non-related party stockholders.  The significant related
party control may also discourage others from acquiring us or from making a
significant investment in us.





General
economic, financial market and political conditions may materially adversely
affect our results of operations and financial conditions.





General
economic, financial market and political conditions may have an adverse effect
on demand for our services and programs and on our results of operations and
financial condition.  Concerns over a prolonged recession, the
availability and cost of credit, the declining global mortgage and real estate
market, the loss of consumer confidence and reduction in consumer spending,
inflation, and other macroeconomic factors could influence demand for our
services and programs.  There could be a number of follow-on effects
from the credit crisis on our business, including insolvency of key partners,
inability of customers to obtain credit to finance purchases of our services and
programs, and/or customer insolvencies each of which could adversely affect our
results of operations and financial condition.





We
currently generate significant revenue through our independent marketing
representatives.





We derive
our revenue through product sales of our independent marketing
representatives.  In the event we are unable to attract, motivate and
retain our independent marketing representative base our business, financial
condition and results of operations could be materially and adversely affected
as the Company’s revenue is directly tied to the activity levels of its
marketing representative base.


6





We
may be unable to fund future growth.





Our
business strategy calls for expansion through an increase in our independent
marketing representative base and increase breadth of product
offering.  We will require significant funding for additional
personnel, capital expenditures as well as for working capital purposes.
Financing may not be available to us on favorable terms, if at all. If adequate
funds are not available on acceptable terms, then we may not be able to meet our
business objectives for expansion and profitability which could consequently
harm our business, results of operations and financial condition.





In
addition, if we raise additional funds through the issuance of equity or
convertible debt securities, or a combination of both, then the stockholders
will suffer dilution, and any new securities may have rights, preferences and
privileges senior to those of our common stock and other series of Preferred
Stock. Furthermore, if we raise capital or acquire businesses by incurring
indebtedness, we will become subject to the risks associated with indebtedness,
including interest rate fluctuations and any financial or other covenants that
our lender may require. Moreover, if our strategy to increase our sales and
marketing resources in order to grow revenues does not produce the desired
result, then the Company may incur significant, unrecoverable
expenses.





Our growth may be limited if we are
unable to attract and retain qualified
personnel.





Our
business is largely dependent on the skills, experience and performance of key
members of our senior management team. We plan to increase the Company’s
operations and finance personnel. We believe that our success depends largely on
our ability to attract and retain highly-skilled and qualified technical and
managerial personnel. The market for highly skilled sales, marketing and support
personnel is highly competitive as a result of the limited availability of
technically-qualified personnel with the requisite understanding of the industry
in which we operate. The inability to hire or retain qualified personnel may
hinder our ability to implement our business strategy and may harm our
business.





Our
future growth could strain our personnel and infrastructure resources, and if we
are unable to implement appropriate controls and procedures to manage our
growth, we may not be able to successfully implement our business
plan.





We have
been experiencing strong growth in our operations which is placing, and will
continue to place, a significant strain on our management, administrative,
operational and financial infrastructure. Our future success will depend in part
upon the ability of our management to manage growth effectively. This may
require us to hire and train additional personnel to manage our expanding
operations. In addition, we will be required to continue to improve our
operational, financial and management controls and our reporting systems and
procedures. If we fail to successfully manage our growth, we may be unable to
execute upon our business plan and our business and operations may be adversely
impacted.





Our
ability to anticipate and respond to market trends and changes in consumer
preferences could affect our financial results.





Our
success depends on our ability to anticipate, gauge and react in a timely and
effective manner to changes in consumer spending patterns and preferences for
products and services. We must continually work to develop new products,
maintain and enhance the recognition of our branded products. Furthermore,
material shifts or decreases in market demand for our products, including as a
result of changes in consumer spending patterns and preferences, could result in
lower revenue.





Any
future acquisition may expose us to additional risks





Our
business plan does not preclude growth through the acquisitions of qualified
companies who complement our current product offerings or enhance our product
distribution.  The financing for any future acquisition could dilute
the interests of our stockholders or result in an increase in our indebtedness
or both.  Acquisitions may entail numerous risks,
including:





·
            difficulties
      in assimilating acquired operations or products, including the loss of key
      employees from acquired businesses and disruption to our direct selling
      channel;·
            diversion
      of management’s attention from our core
business


·
            adverse
      effects on existing business relationships with suppliers and customers;
      and·
            risks
      of entering markets in which we have limited or no prior
      experience.





Our
failure to successfully complete the integration of any acquired business could
have a material adverse effect on our business, financial condition and
operating results. In addition, there can be no assurance that we will be able
to identify suitable acquisition candidates or consummate acquisitions on
favorable terms.





We face significant competition
for our products and services.





While our
products and services are relatively new, the direct-to-consumer industry is
intensely competitive, continually evolving and, in some cases, subject to rapid
change. We expect the intensity of competition and the pace of change to be
increased or at least be maintained in the future. Many of our potential
competitors have greater financial, technical, product development, marketing
and other resources than us. These organizations may be better known than we are
and may have more customers or members than us. We cannot provide assurance that
we will be able to compete successfully against these organizations or any
alliances they have formed or may form.  Therefore, there can be no
assurance that our competitors will not:


7








·
            increase
      their emphasis on products and services similar to those we
      offer;·
            provide
      products and services comparable or superior to those we provide at lower
      consumer cost; and


·
            adapt
      more quickly than we do to evolving industry trends or changing market
      requirements;





We
must replace the customers we lose in the ordinary course of business and
if we fail to do so our revenue may decline and our customer base will
decline.





We lose a
substantial number of our customers each year in the ordinary course of
business.  The loss of customers may occur due to numerous factors,
including:





·
            changing
      customer preferences;·
            competitive
      price pressures;


·
            customer
      dissatisfaction;·
            discontinuance
      of third-party products and
services





We
depend on third-party vendors to supply certain products and services that we
market.  The failure of these vendors to provide these products or
services could result in customer dissatisfaction and harm our business and
financial condition.





We depend
on third-party vendors to supply certain products and services that we
market.  Many of our third-party vendors are independent
contractors.  As a result, the quality of service they provide is not
entirely within our control.  If any third-party vendor were to cease
operations, or terminate, breach or not renew its contract with us, or suffer
interruptions, delays or quality problems, we may not be able to substitute a
comparable third-party vendor on a timely basis or on terms favorable to
us.  With respect to our products that contain an insurance benefit,
we are dependent on the insurance carriers that underwrite the insurance to
obtain appropriate regulatory approvals.  If we are required to use an
alternative insurance carrier, it may materially increase the time required to
bring an insurance related product to market.  As we are generally
obligated to continue providing our products and services to our customers even
if we lose a third-party vendor, any disruption in our product offerings could
harm our reputation and result in customer dissatisfaction.  Replacing
existing third-party vendors with more expensive or less quality third-party
vendors could decrease our profitability and harm our reputation.





We
are dependent on Amacore to provide credit card processing and payment
collection.  If Amacore’s credit card processing is interrupted in any
way it could result in delays in collecting payments and our ability to generate
sales.





In the
event Amacore’s credit card processor ceases operations or terminates its
agreement with Amacore, there can be no assurance the Company could find and
retain a replacement credit card processor on a timely basis, if at
all.  Any service interruptions, delays or quality problems could
result in delays in collecting payments, which could adversely affect our
revenue and profitability.





We
must comply with Federal and State telephone consumer protection
laws.





Federal
and State telephone consumer protection laws prohibit deceptive, unfair or
abusive practices in telemarketing sales.  Any new legislation further
regulating telemarketing practices could adversely affect or limit our
operations.





We
face potential liability related to the privacy and security of personal
information we collect from consumers through our website and marketing
operations.





Internet
user privacy has become a major issue both in the United States and abroad. We
have privacy policies posted on our website that we believe comply with
applicable laws requiring notice to users about our information collection, use
and disclosure practices. However, whether and how existing privacy and consumer
protection laws in various jurisdictions apply to the Internet is still
uncertain and may take years to resolve. Any legislation or regulation in the
area of privacy of personal information could affect the way we operate our
website and could harm our business. Further, we cannot assure you that the
privacy policies and other statements on our website or our practices will be
found sufficient to protect us from liability or adverse publicity relating to
the privacy and security of personal information.  Any unauthorized
release or failure to adequately protect private information could cast a
negative public perception of us which in turn could adversely affect our
ability to attract and retain customers.


8





We
may become involved in the future, in legal proceedings that, if adversely
adjudicated or settled, could adversely affect our financial
results.





We have
in the past been a party to litigation and have incurred significant legal costs
and settlement expense.  In general, litigation claims can be
expensive and time consuming to bring or defend against and could result in
settlements or damages that could significantly affect our financial
results.





Risks
Related to Our Stock





We
do not intend to pay dividends on our capital
stock.





We have
never declared or paid any cash dividend on our capital stock. We currently
intend to retain any future earnings and do not expect to pay any dividends in
the foreseeable future, except as required by the terms of the preferred stock
we have issued.





The Company may raise additional
funds in the future through issuances of securities and such additional funding
may be dilutive to stockholders or impose operational
restrictions





We may
raise additional capital in the future to help fund acquisitions and our
operations through sales of shares of our common stock or securities convertible
into shares of our common stock, as well as issuances of debt.  Such
additional financing may be dilutive to our stockholders, and debt financing, if
available, may involve restrictive covenants which may limit our operating
flexibility.  If additional capital is raised through the issuances of
shares of our common stock or securities convertible into shares of our common
stock, the percentage ownership of existing stockholders will be
reduced.  These stockholders may experience additional dilution in net
book value per share and any additional equity securities may have rights,
preferences and privileges senior to those of the holders of our common
stock.





We
are not subject to certain of the corporate governance provisions of the
Sarbanes-Oxley Act of 2002 and, without voluntary compliance with such
provisions, neither you nor the Company will receive the benefits and
protections they were enacted to provide.





Since our common stock
is not listed for trading on a national securities exchange, we are not subject
to certain of the corporate governance rules established by the national
securities exchanges pursuant to the Sarbanes-Oxley Act of
2002.  These rules relate to independent director standards, director
nomination procedures, audit and compensation committees standards, and the
presence of an audit committee financial expert and the adoption of a code of
ethics.





While we
intend to file an application to have our securities listed for trading on a
national securities exchange in the future which would require us to fully
comply with those obligations, we cannot assure you that we will file such an
application, that we will be able to satisfy applicable listing standards, or,
if we do satisfy such standards, that we will be successful in receiving
approval of our application by the governing body of the applicable national
securities exchange.





Applicable
SEC rules governing the trading of “penny stocks” may limit the trading and
liquidity of our common stock which may affect the trading price of our common
stock.





Our
common stock is a “penny stock” as defined under Rule 3a51-1 of the Exchange Act
and is accordingly subject to SEC rules and regulations that impose limitations
upon the manner in which our common stock may be publicly
traded.  These regulations require the delivery, prior to any
transaction involving a penny stock, of a disclosure schedule explaining the
penny stock market and the associated risks.  Under these regulations,
certain brokers who recommend such securities to persons other than established
customers or certain accredited investors must make a special written
suitability determination regarding such a purchaser and receive such
purchaser’s written agreement to a transaction prior to sale.  These
regulations may have the effect of limiting the trading activity of our common
stock and reducing the liquidity of an investment in our common
stock.





Our
common share price may subject us to securities
litigation.





The
market for our common stock is expected to be characterized by significant price
volatility when compared to seasoned issuers, and we expect that our future
share price will be more volatile than a seasoned issuer for the indefinite
future. In the past, plaintiffs have often initiated securities class action
litigation against a company following periods of volatility in the market price
of its securities. We may, in the future, be the target of similar litigation.
Securities litigation could result in substantial costs and liabilities and
could divert management's attention and resources.





Our
stock price may be volatile, which may result in losses to our
stockholders.





The stock
markets have experienced significant price and trading volume fluctuations, and
the market prices of companies listed on the OTC Bulletin Board® (OTCBB) have
been volatile in the past and have experienced sharp share price and trading
volume changes. The trading price of our common stock is likely to be volatile
and could fluctuate widely in response to many of the following factors, some of
which are beyond our control:


9




·
            variations
      in our operating results;·
            changes
      in expectations of our future financial performance, including financial
      estimates by securities analysts and investors;·
            changes
      in operating and stock price performance of other companies in our
      industry;·
            additions
      or departures of key personnel; and·
            future
      sales of our common stock.





Domestic
and international stock markets often experience significant price and volume
fluctuations. These fluctuations, as well as general economic and political
conditions unrelated to our performance, may adversely affect the price of our
common stock.





We
became public by means of a reverse merger, and, as a result, we are subject to
the risks associated with the prior activities of the public
company.





Additional
risks may exist because Zurvita became public through a reverse merger with Red
Sun, which did not have significant operations or assets prior to the time of
the transaction. Red Sun Shell Company was a development stage company from the
time of its inception until the time of the Share Exchange on July 30, 2009.
Prior to the Share Exchange, Red Sun had no significant business operations and
generated no revenues. We may require the cooperation or assistance of persons
or organizations, such as auditors, previously associated with Red Sun in
connection with future matters that could be costly or difficult to secure.
Although we performed a due diligence review of Red Sun, we still may be exposed
to undisclosed liabilities resulting from its prior operations and we could
incur losses, damages or other costs as a result. In connection with the Share
Exchange, claims may not be brought against such shareholders after six months
from the closing of the Share Exchange. Therefore, any liabilities associated
with the prior operations, capitalization or ownership of securities of our
company by the shareholders of Red Sun may be borne by the holders of securities
issued in the Share Exchange or the Private Placement.





Our
common stock may be affected by limited trading volume and price fluctuations,
each of which could adversely impact the value of our common stock.





Our
common stock is listed on the Over the Counter Bulletin Board, but it does not
trade, and there can be no assurance that an active trading market in our Common
stock will either develop or be maintained. In addition, we believe that factors
such as quarterly fluctuations in our financial results and changes in the
overall economy or the condition of the financial markets could cause the price
of our Common stock to fluctuate substantially. These fluctuations also may
cause short sellers to enter the market from time to time in the belief that we
will have poor results in the future. We cannot predict the actions of market
participants and, therefore, can offer no assurances that the market for our
stock will be stable or appreciate over time.





ITEM
1B. UNRESOLVED STAFF COMMENTS





None.





ITEM
2. PROPERTIES





Zurvita
Holdings’s management offices are located at 800 Gessner, Houston, TX
77024.  These facilities are leased and consist of approximately 4 thousand
square feet.  The lease expires on July 31, 2012.





ITEM
3. LEGAL PROCEEDINGS





The
Company is not involved in any lawsuits, claims or disputes arising in the
normal course of business.





ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIY HOLDERS





On June
26, 2009, Matthew Taylor, by action of written consent as former majority
shareholder of the Company adopted resolutions authorizing and directing the
Company to amend its Articles of Incorporation to create a series of preferred
stock consisting of 10 million shares, no par value.





On July
31, 2009, The Amacore Group, Inc. by action of written consent as majority
shareholder adopted resolutions authorizing and directing the Company to amend
its Articles of Incorporation to (i) effect a one (1) for four (4) forward split
of the Company’s common stock and (ii) change the name of Red Sun to Zurvita
Holdings, Inc. and to effectively adopt an incentive stock
plan.


10








PART
II





ITEM
5. MARKET FOR THE REGISTRANT’S
COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES.





Market
Information





The
common stock of the Company is quoted for trading on the OTC Bulletin Board
under the symbol “ZRVT”.  From August 18, 2008, through September 2,
2009, the common stock of the Company was quoted on the OTC Bulletin Board under
the symbol RDSN.  Prior to September 3, 2009, there was no established
public trading market for its common stock.





For the
period from September 3, 2009 through November 6, 2009, the low and high bid
prices for the common stock of the Company as reported on the OTC Bulletin Board
was $0.99 and $1.49.





The
closing price of our common stock on the OTC Bulletin Board on November 6, 2009
was $1.40 per share.





Holders





As of
July 31, 2009, there were 34 holders of record of the Company’s common
stock.





Dividends





The
Company never has paid any cash dividends on the common stock and does not
anticipate paying cash dividends in the foreseeable future. Our current policy
is to retain earnings, if any, to fund operations, and the development and
growth of our business. Any future determination to pay cash dividends will be
at the discretion of the Board of Directors and will be dependent upon the
Company’s financial condition, results from operations, capital requirements,
applicable contractual restrictions, restrictions in the organizational
documents and any other factors that the Board of Directors deems
relevant.





Shares
Authorized for Issuance Under Equity Compensation Plans





Plan
      Category
              Number
      of securities
                to
      be issued upon
                exercise
      of
                outstanding
      options,
                warrants
      and rights (a)
              Weighted-average
                exercise
      price of
                outstanding
      options,
                warrants
      and rights (b)
              Number
      of securities
                remaining
      available for
                future
      issuance under
                equity
      compensation plans
                (excluding
      securities
                reflected
      in column (a)) (c )Equity
      compensation plans approved by security holders
              -
              -
              6,000,000Equity
      compensation plans not approved by security holders
              -
              -
              -Total
              -
              -
              6,000,000








ITEM 6. SELECT FINANCIAL
DATA





Not
applicable.





ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS





Introduction





Management’s
discussion and analysis of results of operations and financial condition
(“MD&A”) is provided as a supplement to and should be read in conjunction
with our audited consolidated financial statements and the related notes thereto
included elsewhere herein to help provide an understanding of our financial
condition and results of our operations.  The MD&A is organized as
follows:


11








·
            Overview– This section
      provides a general description of our business and operating
      segments.





·
            Results of operations –This section provides an analysis of our results of operations
      comparing the seven months ended July 31, 2009 to the period from January
      25, 2008 (Date of Inception) through July 31,
  2008.





·
            Liquidity and capital
      resources– This section provides an analysis of our cash flows for
      the seven months ended July 31, 2009 and from the period January 25, 2008
      (Date of Inception) through July 31, 2008 as well as a discussion of our
      liquidity and capital resources.





·
            Critical accounting policies
      – This section discusses certain significant accounting policies
      considered to be important to our financial condition and results of
      operations and which require significant judgment and estimates on the
      part of management in their application.  In addition, all of
      our significant accounting policies, including our critical accounting
      policies, are summarized in Note 2 to our audited consolidated financial
      statements included within Item 8 of Part II of this 2009 Transition
      Report on Form 10K.





Overview





Description
of Business





The
Company is a provider of products and benefits through the use of a multi-level
marketing distribution channel which consist of independent business
operators.  The products marketed include residential gas and
electricity energy rate plans, discount healthcare benefits and discount
benefits on various retail products and services.  The Company also
markets numerous low cost ancillary products such as home warranty, legal
assistance and restoration services for identity theft and consumer
credit.




12


Results
of Operations


Successor
              
              
              Predecessor(Unaudited)For
      the Seven
                Months
      Ended
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                July
      31, 2008
              
              
              Increase
                (Decrease)Revenues
              
              $
              2,814,449
              
              
              $
              672,938
              
              
              $
              2,141,511Cost
      of Sales
              
              
              2,117,007
              
              
              
              1,077,446
              
              
              
              1,039,561Gross
      Profit (Loss)
              
              
              697,442
              
              
              
              (404,508
              )
              
              
              1,101,950Operating
      Expenses
              
              
              4,256,324
              
              
              
              2,847,926
              
              
              
              1,408,398Operating
      Loss
              
              
              (3,558,882
              )
              
              
              (3,252,434
              )
              
              
              (306,448
              )Other
      Income
              
              
              35,686
              
              
              
              -
              
              
              
              35,686Loss
      Before Income Taxes
              
              
              (3,523,196
              )
              
              
              (3,252,434
              )Income
      Taxes
              
              
              19,144
              
              
              
              4,711
              
              
              
              14,433Net
      Loss
              
              $
              (3,542,340
              )
              
              $
              (3,257,145
              )
              
              $
              (285,195
              )Basic
      and Diluted Loss Per Share
              
              $
              (0.07
              )
              
              $
              (0.07
              )





Revenue:





For the
seven months ended July 31, 2009, revenue was approximately $2.8 million, as
compared to approximately $673 thousand for the period from January 25, 2008
(Date of Inception) through July 31, 2008 an increase of approximately $2.1
million which primarily consisted of membership product sales to individual
consumers and marketing fees paid by Individual Business Owners (“IBO”) of
approximately $1.0 million and $1.8 million, respectively.  Revenue
growth is attributable to the progression of Zurvita’s business plan which has
resulted in new product offerings and continued growth in the Company’s network
sales representatives from 2,417 to 5,068.





Cost
of Sales:





For the
seven months ended July 31, 2009, cost of sales was approximately $2.1 million
as compared to approximately $1.1 million for the period January 25, 2008 (Date
of Inception) through July 31, 2008, an increase of approximately $1
million.  Cost of sales includes sales commissions paid to IBO’s and
the benefit and service costs associated with the products and services
sold.  Commissions and benefit/service costs were approximately $1.7
million and $413 thousand, respectively, for the seven months ended July 31,
2009 as compared to approximately $887 thousand and $191 thousand, respectively,
for the period from January 25, 2008 (Date of Inception) through July 31,
2008.  Less non-traditional sales incentive compensation strategies
were employed during the seven months ended July 31, 2009 which has decreased
cost of sales as a percentage of revenue to 75% from 160% for the seven months
ended July 31, 2009 as compared to the period from January 25, 2008 (Date of
Inception) through July 31, 2008.  In order to attract and retain
marketing representatives while the division was being structured and products
developed, non-traditional means of sales compensation were
employed.  During the seven months ended July 31, 2009, the division
had a greater product offering thereby reducing the need for non-traditional
compensation methods to encourage and retain representatives.





Gross
Profit (Loss) Percentage:





For the
seven months ended July 31, 2009, gross profit was approximately $697 thousand
as compared to a gross loss of approximately $405 thousand for the period from
January 1, 2008 (Date of Inception) through July 31, 2008, an increase of $1.1
million.  The increase in gross profit is due to the fact that the
Company’s product offering and IBO base were further
developed  between the two periods; thus reducing the number of
non-traditional sales incentives the Company utilized to attract and retain
IBO’s, which resulted in higher commissions being paid in proportion to revenue
recognized.





Operating
Expenses:





Our
operating expenses for the seven months ended July 31, 2009 and for the period
January 25, 2008 (Date of Inception) through July 31, 2008 were $4.3 million and
$2.8 million, respectively.


13








The table
below sets forth components of our operating expenses for the seven months ended
July 31, 2009 and for the period January 25, 2008 (Date of Inception) through
July 31, 2008:





Successor
              
              
              Predecessor(Unaudited)For
      the Seven
                Months
      Ended
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                July
      31, 2008
              
              
              Increase
                (Decrease)Depreciation
              
              $
              19,722
              
              
              $
              3,458
              
              
              $
              16,264Office
      related expenses
              
              
              124,239
              
              
              
              74,352
              
              
              
              49,887Payroll
      and benefits
              
              
              758,164
              
              
              
              421,651
              
              
              
              336,513Professional
      fees
              
              
              1,409,565
              
              
              
              1,517,504
              
              
              
              (107,939
              )Selling
      and marketing
              
              
              1,878,349
              
              
              
              659,433
              
              
              
              1,218,916Travel
              
              
              66,285
              
              
              
              171,527
              
              
              
              (105,242
              )Total
      operating expenses
              
              $
              4,256,324
              
              
              $
              2,847,925
              
              
              $
              1,408,399




Depreciation
expense, which is computed on a straight-line method over the assets’ estimated
lives, for the seven months ended July 31, 2009 and the period from January 25,
2008 (Date of Inception) through July 31, 2008, was approximately $20 thousand
and approximately $3 thousand, respectively, an increase of approximately $16
thousand.  The increase is directly related to the purchase of
property, plant and equipment as the growth of the business required additional
capital assets.





Office
related expenses include rent, utilities and office maintenance.  For
the seven months ended July 31, 2009, these expenses were approximately $75
thousand, $27 thousand and $22 thousand, respectively as compared to
approximately $16 thousand, $18 thousand and $40 thousand, respectively, for the
period from January 25, 2008 (Date of Inception) through July 31,
2008.  The overall increase of approximately $50 thousand is due to a
lower level of operations of the first year the Company was operating versus a
more developed operating plan for the second year.





Payroll
and benefits-related expenses for the seven months ended July 31, 2009 was
approximately $758 thousand, an increase of approximately $337 thousand from the
period from January 25, 2008 (Date of Inception) through July 31,
2008.  The increase is due to the addition of personnel from the first
year of operations versus the second year.





Professional
fees consist of consulting, accounting, and legal costs and litigation
contingency accruals. For the seven months ended July 31, 2009, these costs were
approximately $165 thousand, $76 thousand, and $1.2 million, respectively as
compared to approximately $175 thousand, $0 and $1.3 million, respectively for
the period from January 25, 2008 (Date of Inception) through July 31,
2008.  During period from January 25, 2008 (Date of Inception) through
July 31, 2008 legal expense represented approximately $1.3 million of the
professional fees incurred and was primarily related to litigation between
Zurvita/Amacore and Ameriplan.  On July 7, 2009, the Companies were
able to settle the outstanding litigation noted above for $1.8 million by means
of a Mutual Compromise and Settlement Agreement of which $1.2 million was paid
by Amacore and of which $600 thousand was the future responsibility of Zurvita
and structured as a note payable.  If Zurvita and Amacore were not
related parties or named parties of the lawsuit at the time of the settlement,
the outcome, and consequently, the loss incurred by Zurvita with respect to this
settlement may have been materially different.  As a result of the
settlement, the Company’s legal costs have been materially reduced, which was
the primary contributor for the overall decrease in professional fees of $108
thousand for the seven months ended July 31, 2009 compared to the period from
January 25, 2008 (Date of Inception) through July 31, 2008.





Selling
and marketing expenses for the seven months ended July 31, 2009 were
approximately $1.9 million, an increase of  approximately $1.2 million
over the period from January 25, 2008 (Date of Inception) through July 31,
2008.  The increase is directly related to various marketing
initiatives undertaken to create awareness of the Zurvita brand as well as
attract and recruit representatives to the Zurvita business
opportunity.





Travel
expenses for the seven months ended July 31, 2009 were approximately $66
thousand, a decrease of approximately $105 thousand as compared to the period
from January 25, 2008 (Date of Inception) through July 31, 2008.  The
decrease in travel expense is a result of the Company’s efforts to reduce
non-essential costs.





14





Income
Taxes:





For the
seven months ended July 31, 2009, the Company incurred approximately $19
thousand in Texas gross margin tax, an increase of $14 thousand for the period
from January 25, 2008 (Date of Inception) through July 31, 2008.  The
increase is directly correlated with the Company’s increased revenue between the
two periods.





Net
loss:





The
Company’s net loss amounted to approximately $3.5 million for the seven months
ended July 31, 2009 as compared to approximately $3.3 million for the period
from January 25, 2008 (Date of Inception) through July 31, 2008.  The
decrease is due to the factors listed above.





Loss
per common share:





Loss per
common share amounted to $0.07 for the seven months ended July 31, 2009 and
$0.07 for the period from January 25, 2008 (Date of Inception) through July 31,
2008.





Off
Balance Sheet Arrangements





As of
July 31, 2009 the Company did not have any off balance sheet
arrangements.





Liquidity
and Capital Resources





The
following table compares our cash flows for seven months ended July 31, 2009 and
the period from January 25, 2008 (Date of Inception) through July 31,
2008.




Successor
              
              
              PredecessorFor
      the Seven Months Ended July 31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Net
      cash used in operating activities
              
              $
              (3,185,815
              )
              
              $
              (5,165,931
              )Net
      cash provided by (used in) investing activities
              
              
              182
              
              
              
              (143,640
              )Net
      cash provided by financing activities
              
              
              4,576,586
              
              
              
              5,309,571Net
      increase in cash
              
              $
              1,390,953
              
              
              $
              -




Since its
inception, the Company has primarily met its operating cash requirements through
equity contributions from The Amacore Group, Inc. who was the Company’s sole
shareholder prior to the July 30, 2009 share exchange between The Company and
Zurvita Inc.  Since the share exchange, the Company has sold several
series of preferred stock for gross proceeds of $3.75 million. We are using
the proceeds from the sale of preferred stock to subsidize the Company’s
operations as the Company’s revenues are not currently sufficient to support the
Company’s current operations.  These costs and expenses include
operating expenses, such as salary expenses, professional fees, rent
expenses and other general and administrative expenses discussed above, and the
costs of sales discussed above to the extent such costs of sales exceeded our
revenue.


15





The
Company believes that its cash resources, together with increasing revenue and
assuming the continued support of its related party stockholders, will be
sufficient to sustain current planned operations for the next 12 months. The
Company raised $3.75 million from the sale of preferred stock in two tranches
completed in July 2009 and October 2009.  Additional cash resources
may be required should the Company not meet its sales targets, exceed its
projected operating costs, wish to accelerate sales or complete one or more
acquisitions or if unanticipated expenses arise or are incurred.





The
Company does not currently maintain a line of credit or term loan with any
commercial bank or other financial institution and has not made any other
arrangements to obtain additional financing.  We can provide no
assurance that we will not require additional financing.  Likewise, we
can provide no assurance that if we need additional financing that it will be
available in an amount or on terms acceptable to us, if at all.  If we
are unable to obtain additional funds when they are needed or if such funds
cannot be obtained on terms favorable to us, we may be unable to execute our
business plan or pay our costs and expenses as they are incurred, which could
have a material, adverse effect on our business, financial condition and results
of operations.





At July
31, 2009, the Company had positive working capital of approximately $647
thousand and an accumulated deficit of approximately $9.8
million.  For the seven months ended July 31, 2009, the Company had a
net loss of approximately $3.5 million.





Critical
Accounting Policies





Revenue
Recognition





Membership
Fees





The
Company recognizes revenues from membership fees as earned for the sales of
health-related discount benefit plans and other lifestyle discount benefit
programs, such as household protection and personal financial
services.  These arrangements are generally renewable monthly and
revenue is recognized over the renewal period.  As these products
often include elements sold through contracts with third-party providers, the
Company considers each contractual arrangement in accordance with EITF 99-19,
Reporting Revenue Gross as a Principal versus Net as
an Agent(EITF 99-19). The Company’s current contracts meet the
requirements of EITF 99-19 for reporting revenue on a gross basis. The Company
records a reduction in revenue for estimated refunds, chargebacks from credit
card companies, and allowances based upon experience and management’s evaluation
of current facts and circumstances. Refunds and chargebacks totaled
approximately $66 and $80 thousand for the seven months ended July 31, 2009 and
the period from January 25, 2008 (Date of Inception) through December 31, 2008,
respectively.  An estimate for refunds and chargebacks of
approximately $10 thousand for the seven months ended July 31, 2009 and the
period from January 25, 2008 (Date of Inception) through ended December 31, 2008
is included in accrued expenses in the balance sheet.





Commissions





The
Company is paid a commission for its sales of third-party products. Commissions
are recognized as products are sold and services performed and the Company has
accomplished all activities necessary to complete the earnings
process.





Marketing
Fees and Materials





The
Company markets certain of its products through a multi-level sales organization
whereby independent distributors establish their own network of associates. The
independent distributors pay the Company a fee to become marketing
representatives on behalf of the Company. In exchange, the representatives
receive access, on an annual basis, to various marketing and promotional
materials and tools as well as access to customized management reports;
accordingly revenue from marketing fees is recognized over an annual
period.  The Company also earns ancillary revenue from the sale of
marketing materials recognized when marketing materials are provided to the
representatives.





Concentration of Credit
Risk





At
certain times during the year, the Company’s bank deposits exceed the amounts
insured by the FDIC. As of seven months ended July 31, 2009, the Company had
$1.1 million in excess of FDIC insured limits.  Should the financial
institution cease operations when the Company’s deposit balances exceed FDIC
insured limits, it would be a significant disruption to the Company’s cash
flow.  Management continually monitors the Company’s banking
relationships to lessen this risk.  Additionally, all of the Company’s
credit card processing is with one merchant processor, as well as all
multi-level marketing sales commission payments are calculated by a third-party
service provider.





Use of
Estimates





The
preparation of the Company’s consolidated financial statements in conformity
with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.  The accounting
estimates requiring a high degree of  management’s subjective judgment
include sales refund, capitalization of certain assets, depreciable/amortizable
lives, the expected volatility of common stock, and the fair value of common
stock and warrants issued for services or in connection with the sale of
redeemable preferred stock.  Due to the uncertainty inherent in such
estimates, actual results may differ from those estimates.





16





Share-Based
Compensation





The
Company accounts for share-based payments in accordance with Statement of
Financial Accounting Standards No. 123R, Share Based Payment (SFAS
123R).  SFAS 123R requires that the cost resulting from all share-based
payment transactions, including those awarded by the parent, be recognized in
the financial statements.  SFAS 123R establishes fair value as the
measurement objective in accounting for share-based payment arrangements and
requires all entities to apply a fair-value-based measurement method in
accounting for share-based payment transactions.  The Company uses the
Black-Scholes Option Pricing Model in computing fair value of warrant instrument
issuances.  The fair value of share based compensation awarded by the
majority stockholder is reflected as share based compensation expense and as a
capital contribution in the Company’s financial statements over the requisite
service period.





Income
Taxes





We
account for income taxes under Statement of Financial Accounting Standards No.
109, Accounting for Income
Taxes (SFAS 109).  Under SFAS 109, deferred tax assets and
liabilities are recognized for future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases.  Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
reverse.  The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.





We also
follow guidance of Financial Accounting Standards Board’s Interpretation No. 48,
Accounting for Uncertainty in
Income Taxes — An Interpretation of FASB Statement No. 109 (FIN
48).  FIN 48 clarified the accounting for uncertainty in an
enterprise's financial statements by prescribing a recognition threshold and
measurement attribute for the financial statement recognition and measurement of
a tax position taken or expected to be taken in a tax return. FIN 48 requires us
to evaluate our open tax positions that exist on the date of initial adoption in
each jurisdiction.





When tax
returns are filed, it is highly certain that some positions taken would be
sustained upon examination by the taxing authorities, while others are subject
to uncertainty about the merits of the position taken or the amount of the
position that would be ultimately sustained.  The benefit of a tax
position is recognized in the financial statements in the period during which,
based on all available evidence, we believe it is more likely than not that the
position will be sustained upon examination, including the resolution of appeals
or litigation processes, if any.  Tax positions taken are not offset
or aggregated with other positions.  Tax positions that meet the
more-likely-than-not recognition threshold are measured as the largest amount of
tax benefit that is more than 50 percent likely of being realized upon
settlement with the applicable taxing authority.  The portion of the
benefits associated with tax positions taken that exceeds the amount measured as
described above is reflected as a liability for unrecognized tax benefits in the
accompanying balance sheet along with any associated interest and penalties that
would be payable to the taxing authorities upon examination. Interest and
penalties associated with unrecognized tax benefits are classified as income tax
expense in the statement of operations.





Convertible
Instruments





The
Company reviews the terms of convertible preferred stock for indications
requiring bifurcation, and separate accounting, for the embedded conversion
feature. Generally, embedded conversion features where the ability to physical
or net-share settle the conversion option is not within the control of the
Company are bifurcated and accounted for as derivative financial instruments.
Bifurcation of the embedded derivative instrument requires allocation of the
proceeds first to the fair value of the embedded derivative instrument with the
residual allocated to the host instrument. The resulting discount to the
redemption value of convertible preferred securities is accreted through
periodic charges to dividends over the period to the earliest conversion date
using the effective interest rate method.





17





Fair Value
Measurements





On
January 25, 2008, we adopted Statement of Financial Accounting Standard No. 157
Fair Value Measurements
(SFAS 157) except for nonfinancial assets and nonfinancial liabilities that are
recognized or disclosed at fair value in the financial statements on a
nonrecurring basis for which delayed application is permitted until the fiscal
year beginning after January 1, 2009.  SFAS 157 defines fair value as
the price that would be received to sell an asset or paid to transfer a
liability (an exit price) in the principal or most advantageous market for the
asset or liability in an orderly transaction between market participants on the
measurement date. In many cases, the exit price and the transaction (or entry)
price will be the same at initial recognition.  However, in certain
cases, the transaction price may not represent fair value. Prior to SFAS 157,
the fair value of a liability was often based on a settlement price concept,
which assumed the liability was extinguished.  Under SFAS 157, fair
value is based on the amount that would be paid to transfer a liability to a
third party with the same credit standing. SFAS 157 requires that fair value be
a market-based measurement in which the fair value is determined based on a
hypothetical transaction at the measurement date, considered from the
perspective of a market participant.  Accordingly, fair value is no
longer determined based solely upon the perspective of the reporting
entity.  When quoted prices are not used to determine fair value, SFAS
157 requires consideration of three broad valuation techniques: (i) the market
approach, (ii) the income approach, and (iii) the cost approach.  SFAS
157 requires that entities determine the most appropriate valuation technique to
use, given what is being measured and the availability of sufficient
inputs.  SFAS 157 prioritizes the inputs to fair valuation techniques
and allows for the use of unobservable inputs to the extent that observable
inputs are not available.  SFAS 157 establishes a three-level
hierarchy, based on the priority of the inputs to the respective valuation
technique.  The fair value hierarchy gives the highest priority to
quoted prices in active markets for identical assets or liabilities (Level 1)
and the lowest priority to unobservable inputs (Level 3).  An asset or
liability’s classification within the fair value hierarchy is based on the
lowest level of significant input to its valuation.  SFAS 157 defines
the input levels as follows:





Level
      1
            Unadjusted
      quoted prices in active markets for identical assets or
      liabilities.





Level
      2
            Quoted
      prices in markets that are not active or inputs that are observable either
      directly or indirectly. Level 2 inputs include quoted prices for similar
      assets or liabilities other than quoted prices in Level 1, quoted prices
      in markets that are not active, or other inputs that are observable or can
      be derived principally from or corroborated by observable market data for
      substantially the full term of the assets or
  liabilities.





Level
      3
            Unobservable
      inputs that are supported by little or no market activity and are
      significant to the fair value of the assets or
      liabilities.  Unobservable inputs reflect the reporting entity’s
      own assumptions about the assumptions that market participants would use
      in pricing the asset or liability.  Level 3 assets and
      liabilities include those whose values are determined using pricing
      models, discounted cash flow methodologies, or similar techniques, as well
      as those for which the determination of fair value requires significant
      management judgment or estimation.





Recent Accounting
Pronouncements





We have
reviewed accounting pronouncements and interpretations thereof that have
effectiveness dates during the periods reported and in future periods. We
believe that the following impending standards may have an impact on our future
filings. Also see Fair Value Measurements, above. The applicability of any
standard is subject to the formal review of our financial management and certain
standards are under consideration.





In April
2009, Financial Accounting Standards Board (“FASB”) issued Staff Position FSP
No. FAS 107-1 and Accounting Principles Board Opinion (“APB”) 28-1,
“Interim Disclosures about Fair Value of Financial Instruments,” (“FSP No. FAS
107-1”).  This FSP amends Statement No. 107, “Disclosures about
Fair Value of Financial Instruments,” to require disclosures about fair value of
financial instruments for interim reporting periods of publicly traded companies
as well as in annual financial statements. This FSP also amends APB Opinion
No. 28, “Interim Financial Reporting,” to require those disclosures in
summarized financial information at interim reporting periods. This FSP is
effective for interim reporting period ending after June 15, 2009.  As
this pronouncement is only disclosure-related, it did not have an impact on our
financial position and results of operations. The Company’s adoption of FSP
No. 107-1 and APB 28-1 is not expected to have a material impact on the
Company’s consolidated financial position, results of operations and cash
flows.




In
June 2009, the FASB issued FASB Statement No. 166, “Accounting for
Financial Assets – an amendment of FASB Statement No. 140” (“SFAS
No. 166”). SFAS No. 166 is a revision to FASB Statement No. 140,
“Accounting for Transfers and Servicing of Financial Assets and Extinguishment
of Liabilities” and will require more information about transfers of financial
assets, including securitization transactions, and where companies have
continuing exposure to the risks related to transferred financial assets. It
eliminates the concept of a “qualifying special-purpose entity”, changes the
requirements for derecognizing financial assets, and requires additional
disclosures. SFAS No. 166 is effective for financial asset transfers
occurring after the beginning of an entity’s first fiscal year that begins after
November 15, 2009. Early adoption is prohibited. The Company’s adoption of
SFAS No. 166 is not expected to have a material impact on the Company’s
consolidated financial position, results of operations and cash
flows.




In July
2009, the FASB Accounting Standards Codification (“Codification”) became the
single source of authoritative generally accepted accounting principles (“GAAP”)
in the United States. The previously existing GAAP hierarchy consisted of four
levels of authoritative accounting and reporting guidance (levels A through D),
including original pronouncements of the FASB, Emerging Issues Task Force
abstracts and other accounting literature. The Codification eliminates this
hierarchy and replaced the previously existing GAAP (other than rules and
interpretive releases of the SEC) with just two levels of literature:
authoritative and nonauthoritative.  This statement is effective for
financial statements issued for interim and annual periods ending September 15,
2009.





18





Other
recent accounting pronouncements issued by the FASB (including its Emerging
Issues Task Force), the AICPA, and the SEC did not, or are not believed by
management to, have a material impact on our present or future financial
statements.





ITEM 7A.QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.





Not
applicable.

























19





ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.









ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.





On
November 9, 2009, the board of directors of the Company approved the dismissal
of George Stewart, CPA (“Stewart”) as the Company’s independent registered
public accounting firm.  Stewart’s dismissal was effective
immediately.
 
 During
the fiscal years ended July 31, 2008 and 2007,  Stewart’s reports on
the Company's financial statements did not contain an adverse opinion or
disclaimer of opinion, and was not qualified or modified as to uncertainty,
audit scope or accounting principles except, Stewart’s audit reports for the
years ended July 31, 2008 and 2007 stated that several factors raised
substantial doubt about the Company’s ability to continue as a going concern and
that the financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
 
 During
the fiscal years ended July 31, 2008 and 2007 and the subsequent period through
November 9, 2009, (i) there were no disagreements between the Company and
Stewart on any matter of accounting principles or practices, financial statement
disclosure or auditing scope or procedure which, if not resolved to the
satisfaction of Stewart would have caused Stewart to make reference to the
matter in its reports on the Company's financial statements; and  (ii)
there were no reportable events as the term described in Item 304(a)(1)(iv) of
Regulation S-K.
 
 On
November 9, 2009, the Company provided Stewart with a copy of the disclosures it
is making in response to Item 4.01 of Form 8-K and requested that Stewart
furnish it with a letter addressed to the Securities and Exchange Commission
stating whether it agrees with the above statements.  A copy of the
letter, dated November 3, 2009, was filed as Exhibit 16.1  to its Current
Report on Form 8-K filed with the SEC on November 9, 2009..
 
 On
November 9, 2009, the Company engaged McGladrey & Pullen, LLP (“McGladrey”)
as its independent registered public accounting firm for the Company’s fiscal
year ended July 31, 2009. The change in the Company’s independent registered
public accounting firm was approved by the Company’s Board of Directors on
November 9, 2009.
 
 During
the years ended July 31, 2008 and 2007 and the subsequent interim period through
November 9, 2009, the Company did not consult with McGladrey regarding either
(i) the application of accounting principles to a specific completed or
contemplated transaction, or the type of audit opinion that might be rendered on
the Company’s financial statements or (ii) any matter that was either the
subject of a disagreement or event identified in response to (a)(1)(iv) of Item
304 of Regulation S-K.





We had no
disagreements with accountants on accounting and accounting disclosure in 2009
or 2008.




ITEM
9A. CONTROLS AND PROCEDURES.





Evaluation
of Disclosure Controls and Procedures





Our
management, with the participation of our principal executive and principal
financial officer, evaluated the effectiveness of our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act)
as of the end of the period covered by this transition report on Form 10-K.
Based on this evaluation, our principal executive and principal financial
officer concluded that our disclosure controls and procedures are ineffective to
ensure that information we are required to disclose in reports that we file or
submit under the Exchange Act (i) is recorded, processed, summarized and
reported within the time periods specified in SEC rules and forms, and (ii) is
accumulated and communicated to our management, including our principal
executive and principal financial officers, as appropriate to allow timely
decisions regarding required disclosure. Our disclosure controls and procedures
are not designed adequately to provide reasonable assurance that such
information is accumulated and communicated to our management. Our disclosure
controls and procedures include components of our internal control over
financial reporting. Management's assessment of the effectiveness of our
internal control over financial reporting is expressed at the level of
reasonable assurance that the control system, no matter how well designed and
operated, can provide only reasonable, but not absolute, assurance that the
control system's objectives will be met. This conclusion was based on the
material weaknesses identified below with regard to internal controls over
financial reporting.





Report
of Management on Internal Control over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting.  Internal control over financial
reporting is a process designed by, or under the supervision of, our principal
executive and principal financial officer and effected by our Board of
Directors, management and other personnel, to provide reasonable assurance
regarding the reliability of our financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles in the United States of America.  Internal
control over financial reporting includes policies and procedures that (i)
pertain to the maintenance of records that in reasonable detail accurately and
fairly reflect the Company’s transactions and dispositions of its assets; (ii)
provide reasonable assurance that transactions are recorded as necessary for
preparation of our financial statements in accordance with generally accepted
accounting principles in the United States of America and that receipts and
expenditures of the Company’s assets are made in accordance with authorizations
of our management and directors; and (iii) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use or
disposition of our assets that could have a material effect on our financial
statements.  Because of its inherent limitations, internal control
over financial reporting is not intended to provide absolute assurance that a
misstatement of the Company’s financial statements would be prevented or
detected.





Our
management conducted an evaluation of the effectiveness of our internal control
over financial reporting as of July 31, 2009 using the criteria set forth in the
Internal Control over Financial Reporting – Guidance for Smaller Public
Companies issued by the Committee of Sponsoring Organizations of the Treadway
Commission.   Based upon the evaluation, our management concluded that
our internal controls over financial reporting were not effective as of July 31,
2009 because of a material weakness in our internal control over financial
reporting.  A material weakness is a control deficiency that results
in a more than remote likelihood that a material misstatement of the annual or
interim financial statements will not be prevented or detected on a timely basis
by employees in the normal course of their assigned functions.  Our
management concluded that we have several material weaknesses in our internal
control over financial reporting because of inadequate segregation of duties
over authorization, review and recording of transactions as well as the
financial reporting of such transactions.  In addition, the lack of
standardization in the financial reporting process of the Company’s subsidiaries
increases the risk that financial information is not captured completely and
accurately. The Company has developed a plan and is in process of executing the
plan to mitigate these material weaknesses, which includes the addition of
personnel to the accounting function and the implementation of a new accounting
software package that will have system access restrictions based on management
defined user roles based on job function.  Upon the implementation of
this accounting system, the risk of incomplete and inaccurate reporting of
financial information will be mitigated.  In addition, consultants
have been retained to provide specialized technical skills such as valuation of
warrant instruments requiring fair value accounting and impairment
testing.  Use of specialists will reduce the likeliness of a material
error occurring in more technical accounting areas.





This
transition report does not include an attestation report of our registered
public accounting firm regarding internal control over financial
reporting.  Management's report was not subject to attestation by our
registered public accounting firm pursuant to temporary rules of the SEC that
permit the Company to provide only management's report in this transition
report.


20





Changes
in Internal Controls





There was
no change in our internal control over financial reporting that occurred during
the periods covered by this transition report on Form 10-K that materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.





ITEM
9B - OTHER INFORMATION





Not
Applicable.













































21


PART
III








ITEM
10. DIRECTORS, EXECUTIVE OFFICERS
AND CORPORATE GOVERNANCE





The
following table sets forth the respective names, ages and positions of our
directors and executive officers.




Name
      of Officers and Directors
              
              Age
              
              PositionJay
      Shafer
              
              49
              
              Co-Chief
      Executive Officer and DirectorMark
      Jarvis
              
              50
              
              Co-Chief
      Executive OfficerJason
      Post
              
              34
              
              Chief
      Financial OfficerRichard
      Diamond
              
              45
              
              DirectorPaul
      Morrison
              
              41
              
              DirectorChris
      Phillips
              
              37
              
              DirectorGuy
      Norberg
              
              48
              
              Director





Executive
Officers and Directors





Jay
Shafer – Chief Executive Officer and Director





Jay
Shafer was appointed as Co-Chief Executive Officer and as a director of the
Company upon consummation of the Share Exchange.  Mr. Shafer also
serves as Chief Executive Officer and as a director of Amacore.  Mr.
Shafer also served as President of Amacore from January 2007 through December
2008.  Prior to joining Amacore, Mr. Shafer was employed by Protective
Marketing Enterprises, Inc. (PME) from 1997 to 2006. He served as PME’s Vice
President Business Development from 1997 to 2002 and as its Chief Executive
Officer from 2002 to 2006. He was Vice President- Financial Services Division of
John Harland Company from 1988 to 1997.








Mark
Jarvis – Co-Chief Executive Officer





Mark
Jarvis was appointed as Co-Chief Executive Office and as a director upon
consummation of the Share Exchange.  Mr. Jarvis was employed by Amacore in
February 2008 as a Senior Vice President of Sales and Marketing solely
responsible for the development of Zurvita Holdings, Inc., a wholly owned
subsidiary of the Amacore Group.  Mr. Jarvis served as Zurvita Holdings’s
President from February 2008 through July 2009.  Prior to joining Amacore,
Mr. Jarvis enjoyed a prosperous 26-year career in direct sales marketing with
national companies Ameriplan, Reliv Nutritional Products, Primerica Financial
Services and Amway.  His longevity and success in the direct sales industry
demonstrates his visionary leadership in building high-performance teams and
developing new business leaders for increased sales and organizational
growth.





Jason
Post – Chief Financial Officer





Jason
Post was appointed as Chief Financial Officer and Corporate Secretary upon
consummation of the Share Exchange.  Mr. Post also serves as Principal
Accounting Officer and Corporate Secretary of Amacore.  Mr. Post’s
background includes experience as an external auditor for Deloitte & Touche,
LLP (“Deloitte”).  While at Deloitte, he gained specialized knowledge and
experience in the area Sarbanes Oxley compliance and developmental stage
enterprises.  Mr. Post received a B.S. in Accountancy from the University
of South Florida and holds an active Florida and Virginia CPA license and the
American Institute of Certified Fraud Examiner’s CFE designation.





22


Richard
Diamond – Director





Richard
Diamond was appointed to the board of directors of the Company upon consummation
of the Share Exchange.  Mr. Diamond also serves on the board of
directors of Amacore.  Mr. Diamond has served as a Director of
OmniReliant since its inception in August 2006. Since October 2004, Mr. Diamond
has served as the Senior Vice President of Apogee Financial Investments, Inc.
(“Apogee”) a private merchant bank incorporated in Florida. His areas of
responsibility include administration, due diligence, document preparation and
review, and assisting clients with corporate filings and compliance. Apogee owns
100% of Midtown Partners & Co., LLC, a FINRA licensed broker-dealer. From
April 2000 until December 2005, Mr. Diamond served as Managing Member and Vice
President of Apogee Business Consultants, LLC, a Nevada limited liability
corporation specializing in reverse mergers and acquisitions. From October 2001
until December 2005, Mr. Diamond served as founder, President and sole director
of RJ Diamond Consulting, Inc., a privately owned Florida corporation
specializing in financial and public company consulting. From July 2003 until
December 2003, Mr. Diamond served as a Director of Sabre Marketing, Inc. a
private Florida corporation. From August 2001 until August 2002, Mr. Diamond
served as the sole officer and director of Conus Holdings, Inc., a publicly
reporting Nevada shell corporation.





Paul
Morrison – Director





Paul
Morrison was appointed to the board of directors of the Company upon
consummation of the Share Exchange.  Mr. Morrison also serves as Chief
Executive Officer, Chief Financial Officer, President and Assistant Secretary of
OmniReliant.  From October 2005 until October 2006, Mr. Morrison was
the COO of WG Products, a cosmetic company, where he directed all facets of
operations including production, customer service, planning, scheduling,
maintenance, warehousing, distribution, purchasing, sales, and strategic
initiatives. From 2001 through 2005 he managed various operations at Wyeth
Pharmaceuticals. Mr. Morrison started his career working for Calvin Klein
Cosmetics, and has accumulated sixteen years of experience serving in cosmetic
and pharmaceutical operations management roles for Fortune 100 companies. He
received a Bachelor’s of Science degree in Business Management from the Rutgers
University and an Honorable discharge from the United States Air
Force.





Christopher
D. Phillips – Director





Christopher
D. Phillips was appointed to the board of directors of the Company upon
consummation of the Share Exchange.  Mr. Phillips also serves as a
member of the board of directors of Amacore.  Mr. Phillips has been a
managing director for Vicis Capital, LLC since February 2008.  From
2004 through January 2008, Mr. Phillips served as President and CEO of Apogee
Financial Investments, Inc., a merchant bank that owns 100% of Midtown Partners
& Co., LLC, a FINRA licensed broker-dealer. From 2000 through January 2008,
he also served as managing member of TotalCFO, LLC, which provides consulting
and CFO services to a number of public and private companies and high net worth
individuals.  From November 2007 through January 2008 Mr. Phillips served
as the CEO and Chief Accounting Officer of OmniReliant Holdings, Inc. (OTCBB:
ORHI). Presently, he is a member of the Board of Directors OmniReliant Holdings,
Inc., Precision Aerospace Components, Inc. (OTCBB: PAOS) and a few private
companies. Mr. Phillips received a B.S. in Accounting and Finance and a Masters
of Accountancy, with a concentration in Tax, both from the University of
Florida. Mr. Phillips is a Florida CPA. Mr. Phillips currently is a director of
Brookside Technology Holdings Corp., OmniReliant Holdings, Inc., Precision
Aerospace Components, Inc., MDwerks, Inc. and a few private
companies.





Guy
Norberg – Director





Guy
Norberg was appointed to the board of directors of the Company upon consummation
of the Share Exchange.  Mr. Norberg also serves as President and as a
member of the board of directors of Amacore.  Mr. Norberg has been
the  Senior Vice President, Sales and Marketing of Amacore since June,
2008.  Prior to joining Amacore, Mr. Norberg was Vice President, Sales
and Marketing of Protective Marketing Enterprises, Inc. and prior to that he was
a founder and the President of US Health Options / Innovative Health
Benefits.





BOARD
OF DIRECTORS





Audit,
Nominating and Compensation Committees





Our Board
of Directors does not have standing audit, nominating or compensation
committees, committees performing similar functions, or charters for such
committees. Instead, the functions that might be delegated to such committees
are carried out by our Board of Directors, to the extent required.  Our
Board of Directors believes that the cost of establishing such committees,
including the costs necessary to recruit and retain qualified independent
directors to serve on our Board of Directors and such committees and the legal
costs to properly form and document the authority, policies and procedures of
such committees are not justified under our current circumstances.





Given our
lack of operations to date, our Board of Directors believes that its current
members have sufficient knowledge and experience to fulfill the duties and
obligations of the audit committee for our company.


23








We have
no audit committee financial expert. We believe that the cost related to
retaining a financial expert at this time is prohibitive. Further, because of
our stage of development, we believe the services of a financial expert are not
warranted.





Our Board
of Directors does not currently have a policy for the qualification,
identification, evaluation, or consideration of board candidates. Our Board of
Directors does not believe that a defined policy with regard to the
qualification, identification, evaluation, or consideration of candidates
recommended by stockholders is necessary at this time, due to the lack of
operations and the fact that we have not received any stockholder
recommendations in the past.





We expect
to create one or more of such committees and/or policies as determined by our
Board of Directors, provided that we will be required to have audit and
compensation committees when, and if, our shares of Common Stock commence
trading on the Nasdaq Capital or Global Market or on a national securities
exchange such as the American Stock Exchange.





Code
of Ethics





We have
not yet adopted a Code of Business Conduct and Ethics that applies to our
principal executive officer, principal financial officer, and principal
accounting officer or controller, or persons performing similar functions.
However, we intend to adopt a formal Code of Business Conduct and
Ethics.





Corporate
Governance





Meetings
and committees of the Board of Directors





Our Board
of Directors (the Board) conducts its business through meetings of the Board and
through activities of its committees.





During
our last fiscal year, our board of directors had no meetings. All proceedings of
the Board of Directors were conducted by written consent.





Procedure
for Nominating Directors





We have
not made any material changes to the procedures by which security holders may
recommend nominees to our board of directors.





The Board
does not have a written policy or charter regarding how director candidates are
evaluated or nominated for the board. Additionally, the Board has not adopted
particular qualifications or minimum standards that candidates for the board
must meet. Instead, the Board considers how a candidate could contribute to the
company's business and meet the needs of the company and the board.





The Board
will consider candidates for director recommended by our stockholders.
Candidates recommended by stockholders are evaluated with the same methodology
as candidates recommended by management or members of the board. To refer a
candidate for director, please send a resume or detailed description of the
candidate's background and experience with a letter describing the candidate's
interest in the company to Maitland Promenade 1, 485 North Keller Road, Suite
450, Maitland, FL 32751, Attention: Chairman. All candidate referrals are
reviewed by at least one current board member.





Audit
Committee and Audit Committee Financial Expert





As of
July 31, 2009, the Company did not have an audit committee.  However,
Chris Phillips who is a Director of the Board is considered the financial expert
of the Board.  Since our common stock is not listed for trading on a
national securities exchange, but rather quoted on the OTCBB, we are not subject
to rules relating to the independence of our directors or audit committee
members.





Other
Committees





The Board
does not have a compensation committee or a nominating committee, the functions
of which are performed by the Board.





All of
our directors hold office until the next annual meeting of stockholders or until
their successors are duly elected and qualified, and all executive officers hold
office at the discretion of the Board of Directors.








24





Involvement
in Certain Legal Proceedings





Other
than the following legal proceedings listed below that were settled as of the
year ended July 31, 2009, there have been no events under any bankruptcy act, no
criminal proceedings and no judgments, injunctions, orders or decrees material
to the evaluation of the ability and integrity of any director, executive
officer, promoter or control person of Company during the past five
years.





As
previously reported in the 10-K of Amacore for the year ended December 31, 2008
as filed with the SEC on March 31, 2009, Amacore initiated an action, Case No.
DC-08-01101-K), on January 30, 2008, in an attempt to clarify its rights to
engage in business with Mark Jarvis and various other
individuals.   The action, Mark Jarvis and Zurvita, Inc. v.
AmeriPlan Corp. v. Allen Masters v. The Amacore Group, Inc., Patty Duke, Rusty
Duke, Gail Weitl and Rick Weitl (the “Action”),was filed in the 192nd Judicial District Court of
Dallas County Texas.  Mr. Jarvis was a former employee of AmeriPlan
Corporation (“AmeriPlan”) who, along with certain others that were formerly
associated with AmeriPlan, left AmeriPlan to work at
Zurvita.  AmeriPlan responded to the action by asserting counterclaims
against Zurvita, Mr. Jarvis and others that were formerly associated with
AmeriPlan for breach of contract, breach of fiduciary duties, breach of duty of
loyalty, tortuous interference with contractual relations, misappropriation of
confidential information, conversion, unfair competition, and
conspiracy.  In response to the counterclaims, the Company and
Amacore, on behalf of Zurvita Holdings and its employees, asserted numerous
affirmative defenses to the claims.





On July
9, 2009, Amacore entered into a Mutual Compromise Settlement Agreement and
General Release of Claims (the “Settlement Agreement”) with AmeriPlan, Zurvita,
TransMark Financial Services, Inc. and Mark Jarvis.  Pursuant to the
Settlement Agreement and in consideration for the dismissal of all claims and
counterclaims of the Action, Amacore and Zurvita agreed to pay AmeriPlan the sum
of $1.15 million.  In addition, Zurvita Holdings agreed to issue a
promissory note to AmeriPlan in the principal amount of $600 thousand bearing
interest at a rate of 7.5% per annum, payable in 24 monthly installments of
approximately $27 thousand beginning on July 1, 2009 and each month thereafter
until paid in full (the “Note”).  In connection with the issuance of
the Note, Amacore entered into a Guaranty Agreement (the “Guaranty”), pursuant
to which Amacore guaranteed the payment of the Note by Zurvita.  The
Company recognized a loss on settlement of $600 thousand which is included in
professional fees in the accompanying consolidated statement of
operations.





Director
Independence





Our
common stock is quoted on the OTC bulletin board interdealer quotation system,
which does not have director independence requirements. None of our current
board members are independent with respect to NASDAQ rule 4200(a)(15), which
states a director is not considered to be independent if he or she also is an
executive officer or employee of the corporation.





Term
of Office





Our
directors are appointed for a one-year term to hold office until the next annual
general meeting of our shareholders or until removed from office in accordance
with our bylaws. Our officers are appointed by our board of directors and hold
office until removed by the board.





Shareholder
Communications





Shareholder
communications may be sent to our board of directors by mail addressed to: Board
of Directors, Zurvita Holdings, Inc., 800 Gessner, Houston, Texas
77024.





Additional
Information





You may
request a copy of public filings made by the Company with the SEC, by writing to
our Corporate Secretary at Zurvita Holdings, Inc., 800 Gessner, Houston, Texas
77024. Copies of the documents mentioned above also may be found on the SEC’s
EDGAR database at www.sec.gov.





ITEM
11. EXECUTIVE COMPENSATION





Summary
Compensation Table





The
following table sets forth the compensation earned for services for the two most
recently completed years by (i) Zurvita Holdings’s Co-Chief Executive Officer’s
and (ii) the one additional most highly compensated executive officers whose
total compensation during the period from January 1, 2008 (Date of Inception) to
December 31, 2008 and for the seven months ended July 31, 2009 exceeded $100
thousand.


25





Name
      and Principal Position
                Year
                Base
                  Salary
                  ($)
                Bonus
      ($)
                Stock
                  Awards
                  ($)(1)
                Option
      Awards
                  ($)(1)
                Non-Equity
                  IncentivePlan
      Compensation ($)
                Nonqualified
                  Deferred
                  Compensation
                  Earnings
                  ($)
                All
      Other Compensation
                  ($)(4)
                Total
                  Compensation
                  ($)Jay
      Shafer
                2008
                -
                
                -
                -
                -
                -
                -
                -
                -Co-Chief
      Executive Officer and Director
                2009
                -
                
                -
                -
                -
                -
                -
                -
                -Mark
      Jarvis
                2008
                424,615
                
                -
                164,230
                -
                -
                -
                -
                588,845Co-Chief
      Executive Officer
                2009
                295,385
                (2)
                -
                168,557
                -
                -
                -
                -
                463,942Jason
      Post
                2008
                -
                
                -
                -
                -
                -
                -
                -
                -Chief
      Financial Officer
                2009
                -
                
                -
                -
                -
                -
                -
                -
                -
  (1)  Represents
      the dollar amount recognized for financial statement reporting purposes in
      accordance with SFAS 123R.  For a discussion of valuation
      assumptions, see Note 15 to the financial statements contained in this
      transition Report of Form 10K.(2)  Represents
      the compensation dollar amount paid  from January 1, 2009
      through July 31, 2009.





Narrative
Disclosure to Summary Compensation Table


Employment
Agreement with Mark Jarvis





Immediately
following the closing of the Share Exchange Transaction, the Company entered
into an employment agreement with Mark Jarvis (the “Jarvis
Agreement”), pursuant to which Mr. Jarvis agreed to serve as Co-CEO of the
Company for a term of two years.  Pursuant to the Jarvis Agreement,
Mr. Jarvis shall receive annual compensation of $480 thousand (the “Base
Salary”).  Mr. Jarvis shall also be entitled certain other benefits,
including health insurance, as may be provided to other comparable executives of
Zurvita Holdings.  In addition, within 30 days of the execution of the
Jarvis Agreement, the Company shall place 1.8 million shares of the Company’s
common stock in escrow on behalf of Mr. Jarvis pursuant to the Company’s 2009
Incentive Stock Plan (the “Initial Jarvis Shares”). The Initial Jarvis Shares
shall be subject to a vesting period pursuant to which (i) 900.6 thousand shares
shall vest on July 30, 2010, and (ii) 900 thousand shares shall vest on July 30,
2011.  In addition, in the event that for the first quarter ending six
months after July 30, 2009 Zurvita Holdings is cash flow positive, the Company
shall, within 30 days of the Company filing its Form 10-Q, issue to Mr. Jarvis
1.8 shares if such shares were issued on July 30, 2009 would own 5% of the
issued and outstanding shares of the Company (the “Performance Shares”).
Alternatively, for the two quarters ending six (6) months after Start-Up Period,
(“Extended Measuring Quarters”), should the average Zurvita Holdings monthly
cash flow during the Extended Measuring Quarters, as documented on the monthly
cash flow statements, and verified in the Quarterly Report(s), be operationally
cash flow positive, the Performance Shares shall be issued to
Executive.  The Performance Shares shall be issued under the Company’s
2009 Incentive Stock Plan and shall be subject to a one year vesting period from
the time of initial grant.  In addition to his Base Salary, Mr. Jarvis
shall also be eligible to receive certain incentive bonus compensation (the
“Incentive Bonus”) based upon the revenue generated by Zurvita
Holdings.  Mr. Jarvis’ Incentive Bonus shall be calculated as 10% of
Zurvita Holdings net income.  If Mr. Jarvis’ employment is terminated
by the Company as a result of his disability (as such term is defined in the
Jarvis Agreement), Mr. Jarvis shall be entitled to receive a lump sum payment
equal to his (i) accrued but unpaid Base Salary, (ii) any outstanding expense
reimbursements, (iii) any accrued but unpaid Incentive Bonus, (iv) a monthly
amount, which when added to any amounts received by Mr. Jarvis from any
disability policy in effect at the time of his disability, will equal Mr.
Jarvis’ Base Salary for the 12 month period following the date of disability
termination.





None of
the named executive officers of Zurvita Holdings held any options at December
31, 2008.





2009
Incentive Stock Plan





Following
the closing of the Share Exchange Transaction, our Board of Directors adopted
the 2009 Incentive Stock Plan (the 2009 Plan), pursuant to which we reserved for
issuance 6 million shares of our common stock to be used as awards to employees,
directors, consultants, and other service providers. The purpose of the 2009
Plan is to provide an incentive to attract and retain officers, consultants,
advisors and employees whose services are considered valuable, to encourage a
sense of proprietorship and to stimulate an active interest of such persons into
our development and financial success. It is currently anticipated that we will
adopt a separate plan for our Board of Directors. Under the proposed 2009 Plan,
we are authorized to issue incentive stock options intended to qualify under
Section 422 of the Code, non-qualified stock options, stock appreciation rights,
performance shares, restricted stock and long term incentive awards. The 2009
Plan will be administered by our Board of Directors until such time as such
authority has been delegated to a committee of the Board of
Directors.





Director
Compensation





Following
the closing of the Share Exchange Transaction, our Board of Directors intends to
adopt the Zurvita Holdings Non-Employee Director Compensation Policy (the
“Director Compensation Policy”).  Pursuant to the Director
Compensation Policy, each Eligible Director (as such term is defined in the
Director Compensation Policy) shall be entitled to a fee of $1 thousand per
telephonic meeting of the Board of Directors and $2 thousand for live meetings
of the Board of Directors (the “Meeting Fees”).  The Meeting Fees
shall be payable in shares of the Company’s common stock issued under the 2009
Plan based upon the closing price of the Company’s common stock as reported on
the OTC Bulletin Board on the day preceding the meeting.  All Eligible
Directors shall also be entitled to reimbursement from the Company for their
reasonable travel to and from meetings of the Board of Directors and reasonable
logging and meal expenses incident thereto.


26








Family
Relationships





Tracy
Jarvis who is Mark Jarvis’ spouse has a commission agreement with the Company to
recognize her for the past efforts in founding Zurvita Holdings and developing
of Zurvita Holdings’s business, marketing and compensation plans as well as her
involvement in the recruitment of independent marketing
representatives.  Significant terms of the agreement are detail
below:





Relationship –
Tracy is designated as the master representative of the Company.  All
existing and future independent representatives of the Company shall be in her
downline and placed underneath her in the Company’s genealogy
structure.





Compensation
– As sole compensation for her services, she will receive commissions based on
her position in the Company’s downline for the sale of commissionable
products.





Term –
The agreement is effective as of July 29, 2009 and shall continue so long as the
Company and its successors or assigns sell commissionable products through
independent representatives.





Tracy
will continue work with the Company to grow its independent representative base
as well as consult on products and commission structures.





ITEM
12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS





The
following table sets forth certain information known to us with respect to the
beneficial ownership (as defined in Instruction 4 to Item 403 of
Regulation S-K under the Securities Exchange Act of 1934) of our Common
Stock by (i) each person who we anticipate being a beneficial owner of more
than five percent (5%) of any class of our voting securities, (ii) each of
our directors and named executive officers, and (iii) all of our executive
officers and directors as a group.  Except as otherwise listed below, the
address of each person is 800 Gessner, Houston, Texas 77024.





With
respect to the dispositive control over shares, the control rests with the board
of directors for both OmniReliant and Amacore, while for Vicis the control rests
with executive management.


27


Name
      and Address of Beneifical Owner (1)
              
              Amount
      and Nature Of
                Beneficial
      Ownership
                (2)
              
              
              Percentage
                of
      Class
                (2)Executive
      Officers and Directors:Richard
      Diamond (5)
              
              
              -
              
              
              
              
              
              
              -Mark
      Jarvis
              
              
              -
              
              
              
              (3)
              
              
              
              -Jay
      Shafer (6)
              
              
              -
              
              
              
              
              
              
              
              -Paul
      Morrison (5)
              
              
              -
              
              
              
              
              
              
              
              -Christopher
      Phillips (5)
              
              
              -
              
              
              
              
              
              
              
              -Guy
      Norberg (6)
              
              
              -
              
              
              
              
              
              
              
              -Jason
      Post (6)
              
              
              -
              
              
              
              
              
              
              
              -All
      officers and directors as a group (7 persons) (7)
              
              
              -
              
              
              
              
              
              
              
              -Other
      Beneficial Owners:The
      Amacore Group, Inc.
              
              
              37,240,000
              
              
              
              
              
              
              
              33%Vicis
      Capital Master Fund
              
              
              56,000,000
              
              
              
              (4)
              
              
              
              50%OmniReliant
      Holdings, Inc.
              
              
              15,200,000
              
              
              
              
              
              
              
              14%  (1)
      Unless otherwise indicated, the address for each individual listed in this
      column is c/o Zurvita Holdings, Inc., 800 Gessner, Houston, TX
      77024.(2)
      Unless otherwise indicated, each person has sole investment and voting
      power with respect to the shares indicated, subject to community property
      laws, where applicable. For purposes of this table, 56,440,000
      million shares of our common stock outstanding as of July 31, 2009,
      together with securities exercisable or convertible into shares of our
      Common Stock within 60 days of July 31, 2009 for each stockholder.
      Beneficial ownership is determined in accordance with the rules of the
      Securities and Exchange Commission and generally includes voting or
      investment power with respect to securities. Shares of Common Stock that
      are currently exercisable or exercisable within 60 days of July 31, 2009,
      are deemed to be beneficially owned by the person holding such securities
      for the purpose of computing the percentage of ownership of such person,
      but are not treated as outstanding for the purpose of computing the
      percentage ownership of any other person.(3)
      Pursuant to the terms of Mr. Jarvis’ employment agreement, the Company
      granted 1,800,625 shares of the Company’s common stock to Mr. Jarvis
      pursuant to the Company’s 2009 Incentive Stock Plan (the “Initial Jarvis
      Shares”). The Initial Jarvis Shares are subject to a vesting period
      pursuant to which (i) 900,625 shares shall vest on July 30, 2010, and (ii)
      900,000 shares shall vest on July 30, 2011. These shares were
      excluded from this table as they were neither vested as of July 31, 2009
      nor will they be vested within 60 days of July 31,
2009.(4)
      Includes 28,000,000 shares of Common Stock issuable upon exercise of
      outstanding convertible preferred stock and 28,000,000 shares of Common
      Stock issuable upon exercise of outstanding warrants.(5)
      Beneficial owners address: 14375 Myerlake Circle, Clearwater, Florida
      33760(6)
      Beneficial owners address: 485 N. Keller Rd., Maitland, Florida
      32751(7)
      To the best of the Company's knowledge, the ownership amounts reflect
      accurately the named officers' and beneficial owners' current holdings as
      of the date of this analysis.


28





ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE.





Transactions
with Related Persons





Other
than the transactions described below, none of the following parties has, since
our date of incorporation, had any material interest, direct or indirect, in any
transaction with us or in any presently proposed transaction that has or will
materially affect us:





·
            Any
      of our directors or executive
officers;


·
            Any
      person proposed as a nominee for election as a
  director


·
            Any
      person who beneficially owns, directly or indirectly, shares carrying more
      than 5% of any class of voting
securities;


·
            Any
      of our promoters;


·
            Any
      relative or spouse of any of the foregoing persons who has the same house
      as such person.





During
the seven months ended July 31, 2009 and the period from January 25, 2008 (Date
of Inception) to December 31, 2008, the Company received approximately $2.6
million and $5.7 million of equity contributions from its majority stockholder,
Amacore, respectively.





There are
immediate family members of Mr. Jarvis, who operate as Independent Business
Owners (“IBO”) who were paid agent advances and commission compensation which
amounted to approximately $37 thousand and approximately $37 thousand,
respectively, for the seven months ended July 31, 2009, for work in which they
perform on behalf of the Company.





Repurchase
Agreement





On the
Closing Date, the Company also entered into the Repurchase Agreement with Mr.
Taylor, pursuant to which the Company repurchased from Mr. Taylor an aggregate
of 2 million shares of Common Stock, which represented 66.7 percent of the
Company’s shares of Common Stock then issued and outstanding, for an aggregate
purchase price of $210 thousand.





Agreement
with OmniReliant Holdings, Inc.





Zurvita
Holdings entered into an Advertising and Marketing Agreement with OmniReliant
Holdings, Inc., pursuant to which Zurvita agreed to provide placement of
advertising for OmniReliant on its website and OmniReliant agreed to provide
Zurvita with certain marketing services.  The marketing services to be
provided by OmniReliant include the production of infomercials, video production
services, management of call centers, buying and fulfillment
services.  In consideration for such services, OmniReliant received an
aggregate of 3.8 million shares of the Company’s common stock which was valued
at $657 thousand.





Agreement
with Amacore Group, Inc.





Zurvita
Holdings entered into a Marketing and Sales Agreement with its majority
stockholder, Amacore, pursuant to which Amacore agreed to provide certain
services to Zurvita Holdings.  In addition, pursuant to the Amacore
Agreement, Zurvita shall continue to have the right to benefit from certain
agreements which Amacore maintains with product and service
providers.





Director
Independence





Our
common stock is quoted on the OTC bulletin board interdealer quotation system,
which does not have director independence requirements. None of our current
board members are independent with respect to NASDAQ rule 4200(a)(15), which
states a director is not considered to be independent if he or she also is an
executive officer or employee of the corporation.


29


ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES





The
following table presents fees for professional audit services performed by our
principal accountants, McGladrey & Pullen, LLP for the audit of our annual
financial statements and review of financial statements for the period ended
July 31, 2009 and for the period from January 25, 2008 (Date of Inception)
through December 31, 2008, respectively, and fees billed for other services
rendered by McGladrey & Pullen, LLP during such years.





Successor
              
              
              PredecessorFor
      the Period from January 1, 2009
                through
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Audit
      Fees
              
              
              62,925
              
              
              
              -Tax
      Fees
              
              
              -
              
              
              
              -Other
              
              
              -
              
              
              
              -Total
              
              $
              62,925
              
              
              $
              -





Pre-Approval
Policy And Procedures





We may
not engage our independent auditors to render any audit or non-audit service
unless our Board approves the service in advance.































30





Item
15. Exhibits





Exhibit
              Number
            
            
            Description
            
            Document
      Location2.1
            
            
            Share
      Exchange Agreement by and among Red Sun Mining, Inc., Zurvita, Inc. and
      the shareholders of Zurvita, Inc. dated July 30, 2009
            
            Exhibit
      2.1 to the Current Report on Form 8-K filed on  August 5,
      2009.3.1
            
            
            Certificate
      of Amendment
            
            Exhibit
      3.1 to the Current Report on Form 8-K filed on August 5,
2009.3.2
            
            
            Certificate
      of Amendment to the Certificate of Incorporation
            
            Exhibit
      3.1 to the Current Report on Form 8-K filed on August 25,
      2009.4.1
            
            
            Series
      A Convertible Preferred Stock Certificate of Designation
            
            Exhibit
      4.1 to Form 8-K filed on August 5, 2009.4.2
            
            
            Form
      of Series A Common Stock Purchase Warrant Certificate 1 between Red Sun
      Mining, Inc. and Vicis Capital Master Fund
            
            Exhibit
      4.2 to Form 8-K filed on August 5, 2009.4.3
            
            
            Form
      of Series A Common Stock Purchase Warrant Certificate 2 between Red Sun
      Mining, Inc. and Midtown Partners & Co., LLC.
            
            Exhibit
      4.3 to the Annual Report on Form 8-K filed on August 5,
    2009.4.4
            
            
            Securities
      Purchase Agreement by and among Red Sun Mining, Inc., and Vicis Capital
      Master Fund dated July 30, 2009.
            
            Exhibit
      4.4 to the Annual Report on Form 8-K filed on August 5,
    2009.10.1
            
            
            Advertising
      and Marketing Agreement by and between Zurvita, Inc. and OmniReliant
      Holdings, Inc. dated July 30, 2009
            
            Exhibit
      10.14 to the Annual Report on Form 8-K filed on August 5,
      2009.10.2
            
            
            Marketing
      and Sales Agreement by and between The Amacore Group, Inc. and Zurvita,
      Inc. dated July 30, 2009
            
            Exhibit
      10.2 to the Annual Report on Form 8-K filed on August 5,
2009.10.3
            
            
            Employment
      Agreement with Mark Jarvis dated July 30, 2009
            
            Exhibit
      10.3 to the Annual Report on Form 8-K filed on August 5,
    2009.10.4
            
            
            Commission
      Agreement with Tracy Jarvis dated July 30, 2009
            
            Exhibit
      10.4 to the Annual Report on Form 8-K filed on August 5,
    2009.10.5
            
            
            Securities
      Purchase Agreement by and among Zurvita Holdings, Inc., and Midtown
      Partners & Co., LLC dated October 6, 2009.
            
            Exhibit
      10.14 to the Annual Report on Form 8-K filed on October 6,
      2009.10.6
            
            
            Series
      B Convertible Preferred Stock Certificate of Designation
              Marketing
      and Sales Agreement by Zurvita Holdings, Inc. dated October 6,
      2009
            
            Exhibit
      10.2 to the Annual Report on Form 8-K filed on October 6,
      2009.10.7
            
            
            Form
      of Series B Common Stock Purchase Warrant Certificate between Zurvita
      Holdings, Inc. and Midtown Partners & Co., LLC.
            
            Exhibit
      10.3 to the Annual Report on Form 8-K filed on October 6,
      2009.10.8
            
            
            Securities
      Purchase Agreement by and among Zurvita Holdings, Inc., and Beyond
      Commerce, Inc. dated October 9, 2009
            
            Exhibit
      10.4 to the Annual Report on Form 8-K filed on October 9,
      2009.10.9
            
            
            License
      and Marketing Agreement between OmniReliant Holdings, Inc. and Zurvita
      Holdings, Inc. dated October 9, 2009
            
            Exhibit
      10.3 to the Annual Report on Form 8-K filed on October 9,
      2009.10.10
            
            
            6%
      Promissory Note dated October 9, 2009 due October 9, 2012
            
            Exhibit
      10.4 to the Annual Report on Form 8-K filed on October 9,
      2009.31.1
            
            
            Certification  of
      the Co-Chief Executive Officer pursuant to Section 13(a) or 15(d) of the
      Securities Exchange Act of 1934 adopted by Section 302 of the
      Sarbanes-Oxley Act of 2002.
            
            Filed
      herewith31.2
            
            
            Certification  of
      the Chief Financial Officer pursuant to Section 13(a) or 15(d) of the
      Securities Exchange Act of 1934 adopted by Section 302 of the
      Sarbanes-Oxley Act of 2002.
            
            Filed
      herewith32.1
            
            
            Certification
      pursuant to Section 906 Sarbanes-Oxley Act of 2002 (18 U.S.C Section
      1350).
            
            Filed
      herewith





31





SIGNATURES





In
accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.








Dated:November
      12, 2009
            /s/ Jay ShaferJay
      ShaferCo-Chief
      Executive Officer





In
accordance with the Securities Exchange Act of 1934, this report has been signed
below by the following persons on behalf of the Registrant on the 12th day of November, 2009 in the
capacities indicated.





/s/Jay
Shafer


Jay
Shafer


Co-Chief
Executive Officer and


Director





/s/ Mark
Jarvis


Mark
Jarvis


Co-Chief
Executive Officer





/s/  Jason
Post


Jason
Post


Chief
Financial Officer





/s/  Richard
Diamond


Richard
Diamond


Director





/s/  Paul
Morrison


Paul
Morrison


Director





/s/ 
Chris Phillips


Chris
Phillips


Director





/s/ 
Guy Norberg


Guy
Norberg


Director














32











Exhibit
Index








Exhibit
              Number
            
            
            Description31.1
            
            
            Certification  of
      the Co-Chief Executive Officer pursuant to Section 13(a) or 15(d) of the
      Securities Exchange Act of 1934 adopted by Section 302 of the
      Sarbanes-Oxley Act of 2002.31.2
            
            
            Certification  of
      the Chief Financial Officer pursuant to Section 13(a) or 15(d) of the
      Securities Exchange Act of 1934 adopted by Section 302 of the
      Sarbanes-Oxley Act of 2002.32.1
            
            
            Certification
      pursuant to Section 906 Sarbanes-Oxley Act of 2002 (18 U.S.C Section
      1350).




























33




Index to
Financial Statements








Report of
      Independent Registered Public Accounting
    Firm
            F-2Consolidated Balance
      Sheets - Successor - July 31, 2009 - Predecessor - December 31,
    2008
            F-3Consolidated
      Statements of Operations -  Successor - For
      the SevenMonths
      EndedJuly
      31, 2009;
              Precedessor 
      For
      the Period from January 25, 2008 (Date of Inception) throughDecember
      31, 2008
            F-4Consolidated
      Statements of Cash Flows -  Successor - For
      the SevenMonths
      EndedJuly
      31, 2009;
              Precedessor 
      For
      the Period from January 25, 2008 (Date of Inception) throughDecember
      31, 2008
            F-5Consolidated
      Statements of Stockholders' Deficit
            F-6Notes to
      Consolidated Financial Statements
            F-7


















































F-1




Report
of Independent Registered Public Accounting Firm


To the
Board of Directors and Stockholders
 Zurvita
Holdings, Inc.
 
 We have
audited the accompanying consolidated balance sheets of Zurvita Holdings, Inc.
and subsidiaries as of July 31, 2009 and December 31, 2008, and the related
consolidated statements of operations, stockholders' deficit, and cash flows for
the seven months ended July 31, 2009 and for the period from January 25, 2008
(date of inception) through December 31, 2008.  These financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements based on
our audits.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis
for our opinion.
 
 In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Zurvita Holdings, Inc. and
subsidiaries as of July 31, 2009 and December 31, 2008, and the results of their
operations and their cash flows for the seven months ended July 31, 2009
and for the period from January 25, 2008 (date of inception) through December
31, 2008, in conformity with U.S. generally accepted accounting
principles.
 
 We were
not engaged to examine management's assessment of the effectiveness of Zurvita
Holdings, Inc. and subsidiaries' internal control over financial reporting as of
July 31, 2009, included in the accompanying Management’s Annual Report on
Internal Control over Financial Reporting and, accordingly, we do not express an
opinion thereon.
 
 The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operations
and has not generated sufficient cash flows from operations to meet its
needs.  This raises substantial doubt about the Company's ability to
continue as a going concern.  Management's plans in regard to these
matters are also described in Note 1.  The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
 
 
 /s/  McGladrey
& Pullen, LLP
  
 Orlando,
Florida
 November
12, 2009


F-2


ZURVITA
      HOLDINGS, INC.CONSOLIDATED
      BALANCE SHEETSSuccessor
                
                
                PredecessorJuly
      31, 2009
                
                
                December
      31, 2008ASSETSCurrent
      assetsCash
                
                $
                1,390,953
                
                
                $
                -Accounts
      receivable
                
                
                47,732
                
                
                
                10,963Agent
      advanced compensation
                
                
                927,002
                
                
                
                622,206Deferred
      marketing costs
                
                
                657,400
                
                
                
                -Total
      current assets
                
                
                3,023,087
                
                
                
                633,169Property,
      plant and equipment (net of accumulated depreciation of$31,604
      and $11,802 for 2009 and 2008, respectively)
                
                
                112,036
                
                
                
                131,758Agent
      advanced compensation
                
                
                271,344
                
                
                
                507,299Legal
      retainer
                
                
                -
                
                
                
                50,000Merchant
      account deposit
                
                
                115,333
                
                
                
                115,333Other
      assets
                
                
                24,126
                
                
                
                8,216Total
      assets
                
                $
                3,545,926
                
                
                $
                1,445,775LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      liabilitiesAccounts
      payable
                
                $
                471,081
                
                
                $
                204,626Notes
      payable - current
                
                
                787,237
                
                
                
                -Accrued
      expenses
                
                
                148,001
                
                
                
                664,458Deferred
      revenue
                
                
                934,321
                
                
                
                1,085,676Income
      tax payable
                
                
                35,276
                
                
                
                16,133Total
      current liabilities
                
                
                2,375,916
                
                
                
                1,970,893Notes
      payable - long term
                
                
                284,967
                
                
                
                -Fair
      value of warrants
                
                
                549,780
                
                
                
                -Total
      liabilities
                
                
                3,210,663
                
                
                
                1,970,893Redeemable
      Preferred Stock
                
                
                1,211,000
                
                
                
                -Commitments
      and contingencies (Note 17)Stockholders'
      deficitCommon
      stock ($.0001 par value, 100,000,000 sharesauthorized;
      64,440,000 and 49,240,000 shares issued and56,440,000
      and 49,240,000 shares outstanding as of July 31, 2009 andDecember
      31, 2008, respectively)
                
                
                6,444
                
                
                
                4,924Treasury
      Stock
                
                
                (210,000
                )
                
                
                -Additional
      paid-in capital
                
                
                9,094,182
                
                
                
                5,693,981Accumulated
      deficit
                
                
                (9,766,363
                )
                
                
                (6,224,023
                )Total
      stockholders' deficit
                
                
                (875,737
                )
                
                
                (525,118
                )Total
      liabilities and stockholders' deficit
                
                $
                3,545,926
                
                
                $
                1,445,775The
      accompanying notes are an integral part of these financial
      statements.




F-3




ZURVITA
      HOLDINGS, INC.CONSOLIDATED
      STATEMENTS OF OPERATIONSSuccessor
              
              
              PredecessorFor
      the Seven
                Months
      Ended
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008 (Date of Inception)
      through
                December
      31, 2008REVENUESCommissions
              
              $
              65,876
              
              
              $
              458Marketing
      fees and materials
              
              
              1,783,676
              
              
              
              1,238,919Membership
      fees
              
              
              964,897
              
              
              
              1,065,332Total
      revenues
              
              
              2,814,449
              
              
              
              2,304,709COST
      OF SALESBenefit
      and service cost
              
              
              412,676
              
              
              
              481,933Sales
      commissions
              
              
              1,704,331
              
              
              
              2,465,238Total
      cost of sales
              
              
              2,117,007
              
              
              
              2,947,171GROSS
      PROFIT (LOSS)
              
              
              697,442
              
              
              
              (642,462
              )OPERATING
      EXPENSESDepreciation
              
              
              19,722
              
              
              
              11,882Office
      related expenses
              
              
              124,239
              
              
              
              181,528Payroll
      and employee benefits
              
              
              758,164
              
              
              
              943,000Professional
      fees
              
              
              1,409,565
              
              
              
              2,286,433Selling
      and marketing
              
              
              1,878,349
              
              
              
              1,757,873Travel
              
              
              66,285
              
              
              
              384,712Total
      operating expenses
              
              
              4,256,324
              
              
              
              5,565,428Loss
      from operations before other income (expense)
              
              
              (3,558,882
              )
              
              
              (6,207,890
              )OTHER
      INCOME (EXPENSE)Gain
      on settlement of liability
              
              
              38,700
              
              
              
              -Interest
      expense
              
              
              (3,014
              )
              
              
              -Total
      other income (expense)
              
              
              35,686
              
              
              
              -Loss
      before income taxes
              
              
              (3,523,196
              )
              
              
              (6,207,890
              )Income
      taxes
              
              
              19,144
              
              
              
              16,133Net
      loss
              
              $
              (3,542,340
              )
              
              $
              (6,224,023
              )Basic
      and diluted loss per share
              
              $
              (
      0.07
              )
              
              $
              (
      0.13
              )Basic
      and diluted weighted average number of common shares
      outstanding
              
              
              49,307,924
              
              
              
              49,240,000The
      accompanying notes are an integral part of these financial
      statements.









F-4






ZURVITA
      HOLDINGS, INC.CONSOLIDATED
      STATEMENTS OF STOCKHOLDERS' DEFICITShares
                  Common
      Stock
                
                
                Common
                  Stock
                
                
                Treasury
                  Stock
                
                
                Additional
                  Paid-In
                  Capital
                
                
                Accumulated
                  Deficit
                
                
                Total
                  Stockholder's
                  DeficitBalance,
      January 25, 2008
                
                
                -
                
                
                $
                -
                
                
                $
                -
                
                
                $
                -
                
                
                $
                -
                
                
                $
                -Reverse
      recapitalization
                
                
                49,240,000
                
                
                
                4,924
                
                
                
                -
                
                
                
                (
      4,923
                )
                
                
                -
                
                
                
                1Contributions
      of capital
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                5,534,674
                
                
                
                -
                
                
                
                5,534,674Share
      based compensation (non-cash capital contribution)
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                164,230
                
                
                
                -
                
                
                
                164,230Net
      loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (
      6,224,023
                )
                
                
                (6,224,023
                )Balance,
      December 31, 2008
                
                
                49,240,000
                
                
                $
                4,924
                
                
                $
                -
                
                
                $
                5,693,981
                
                
                $
                (
      6,224,023
                )
                
                $
                (
      525,118
                )Contributions
      of capital
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                2,564,382
                
                
                
                -
                
                
                
                2,564,382Share
      based compensation (non-cash capital contribution)
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                179,757
                
                
                
                -
                
                
                
                179,757Issuance
      of common stock for marketing agreement
                
                
                15,200,000
                
                
                
                1,520
                
                
                
                -
                
                
                
                655,880
                
                
                
                -
                
                
                
                657,400Treasury
      stock purchase
                
                
                -
                
                
                
                -
                
                
                
                (
      210,000
                )
                
                
                -
                
                
                
                -
                
                
                
                (
      210,000
                )Net
      assets acquired of Red Sun
                
                
                
                
                
                
                
                
                
                
                -
                
                
                
                182
                
                
                
                -
                
                
                
                182Net
      loss
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (3,542,340
                )
                
                
                (3,542,340
                )Balance,
      July 31, 2009
                
                
                64,440,000
                
                
                $
                6,444
                
                
                $
                (210,000
                )
                
                $
                9,094,182
                
                
                $
                (9,766,363
                )
                
                $
                (875,737
                )The
      accompanying notes are an integral part of these financial
      statements.








F-5


ZURVITA
      HOLDINGS, INC.CONSOLIDATED
      STATEMENTS OF CASH FLOWSSuccessor
                
                
                PredecessorFor
      the Seven
                  Months
      Ended
                  July
      31, 2009
                
                
                For
      the Period from January 25, 2008 (Date of Inception)
      through
                  December
      31, 2008Cash
      flows from operating activitiesNet
      loss
                
                $
                (3,542,340
                )
                
                $
                (6,224,023
                )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
                
                
                19,722
                
                
                
                11,882Share-based
      compensation
                
                
                190,537
                
                
                
                164,230Gain
      on extinguishment of liabilities
                
                
                38,700
                
                
                
                -Loss
      on legal settlement
                
                
                600,000
                
                
                
                -Changes
      in operating assets and liabilitiesIncrease
      in accounts receivable
                
                
                (36,771
                )
                
                
                (10,963
                )Increase
      in agent advanced compensation
                
                
                (68,841
                )
                
                
                (1,129,505
                )(Increase)
      decrease in legal retainer
                
                
                50,000
                
                
                
                (50,000
                )Increase
      in merchant account deposits
                
                
                -
                
                
                
                (115,333
                )Increase
      in other assets
                
                
                (15,909
                )
                
                
                (8,216
                )Increase
      (decrease) in accounts payable and accrued expenses
                
                
                (269,558
                )
                
                
                1,110,321Increase
      (decrease) in deferred revenue
                
                
                (151,355
                )
                
                
                1,085,676Net
      cash used in operating activities
                
                
                (3,185,815
                )
                
                
                (5,165,931
                )Cash
      flows from investing activitiesPurchase
      of property and equipment
                
                
                -
                
                
                
                (143,640
                )Funds
      obtained from reverse recapitalization
                
                
                182
                
                
                
                -Net
      cash provided by (used in) investing activities
                
                
                182
                
                
                
                (143,640
                )Cash
      flows from financing activitiesContributions
      of capital from The Amacore Group, Inc.
                
                
                2,564,382
                
                
                
                5,309,570Net
      proceeds from borrowings from related parties
                
                
                523,190
                
                
                
                -Proceeds
      from sale of preferred stock
                
                
                1,750,000
                
                
                
                -Proceeds
      from sale of common stock
                
                
                -
                
                
                
                1Principal
      payments on notes payable
                
                
                (50,986
                )
                
                
                -Repurchase
      of treasury stock
                
                
                (210,000
                )
                
                
                -Net
      cash provided by financing activities
                
                
                4,576,586
                
                
                
                5,309,571Net
      change in cash balance
                
                $
                1,390,953
                
                
                $
                -Beginning
      cash
                
                
                -
                
                
                
                -Ending
      cash
                
                $
                1,390,953
                
                
                $
                -Supplemental
      disclosure of cash flow informationCash
      paid for interest
                
                $
                3,014
                
                
                $
                -Cash
      paid for income taxes
                
                $
                -
                
                
                $
                -The
      accompanying notes are an integral part of these financial
      statements.


F-6


ZURVITA
HOLDINGS, INC.


NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS


FOR
THE PERIODS JANUARY 1, 2009 THROUGH JULY 31, 2009


AND


JANUARY
25, 2008 (DATE OF INCEPTION) THROUGH DECEMBER 31, 2008







NOTE
1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION





Our
consolidated financial statements include the accounts of the Zurvita Holdings,
Inc. (Company) and our wholly-owned subsidiaries, Red Sun Mining, Inc. (Red Sun)
and Zurvita, Inc. (Zurvita).  Material intercompany transactions and
balances have been eliminated upon consolidation.  Zurvita is a
provider of products and benefits through the use of a multi-level marketing
distribution channel which consist of independent business
operators.  The products marketed include residential gas and
electricity energy rate plans, discount healthcare benefits and discount
benefits on various retail products and services.  Zurvita also
markets numerous low cost ancillary products such as home warranty, legal
assistance and restoration services for identity theft and consumer
credit.  Red Sun was a shell company and has not yet realized any
revenues from its planned operations.




On July
30, 2009, Zurvita completed a share exchange with Red Sun, a publicly traded
shell company.  All of the outstanding shares of Zurvita were
exchanged for 9.3 million shares of Red Sun.  As a result of the
transaction, Red Sun experienced a change in control and ceased to be a shell
company, and Zurvita became its wholly-owned subsidiary, and the former
shareholders of Zurvita  became the owners of approximately 66 percent
of the Company’s issued and outstanding shares of common stock and 44 percent of
the voting rights of total equity securities outstanding (after giving effect to
subsequent issuances of common stock).  Consequently, the transaction
was accounted for as a recapitalization with Zurvita designated as the
accounting acquirer. The combined entity elected to change its name from Red Sun
Mining, Inc. to Zurvita Holdings, Inc. while maintaining Red Sun’s previous
status as a SEC registrant, and we are continuing the business plan of Zurvita
only.




As a
result of Zurvita being treated as the accounting acquirer, the historical
financial statements of the consolidated entity, prior to the recapitalization,
are those of Zurvita. Therefore, the consolidated balance sheet as of December
31, 2008 includes Zurvita’s financial activity at historical
amounts.  In contrast, the consolidated balance sheet as of July 31,
2009 is a combination of Zurvita and Red Sun accounts.  Historical
stockholders’ equity of Zurvita prior to the merger was retroactively restated
for the equivalent number of shares received in the merger after giving effect
to the difference in par value of the Red Sun’s and Zurvita’s stock with an
offset to paid-in capital.  The accumulated deficit of Zurvita has
been carried forward after the recapitalization.  Earnings per share
for the periods prior to the merger have been restated to reflect the number of
equivalent share received by the Zurvita shareholders.




As a
result of this transaction, Zurvita changed its fiscal year end from December 31
to July 31.  For comparative purposes, the predecessor company’s
financial activity for the seven months ended July 31, 2009 and the period from
January 25, 2008 (Date of Inception) through July 31, 2008 is provided
below.


F-7





(Unaudited)For
      the Seven
                Months
      Ended
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008 (Date of Inception)
      through
                July
      31, 2008Revenues
              
              $
              2,814,449
              
              
              $
              672,938Cost
      of Sales
              
              
              2,117,007
              
              
              
              1,077,446Gross
      Profit (Loss)
              
              
              697,442
              
              
              
              (404,508
              )Operating
      Expenses
              
              
              4,256,324
              
              
              
              2,847,926Total
      Other Income
              
              
              35,686
              
              
              
              -Net
      loss before income taxes
              
              
              (3,523,196
              )
              
              
              (3,252,434
              )Income
      taxes
              
              
              19,144
              
              
              
              4,711Net
      loss
              
              $
              (3,542,340
              )
              
              $
              (3,257,145
              )Basic
      and diluted loss per share
              
              $
              (0.07
              )
              
              $
              (0.07
              )Basic
      and diluted weighted average number of common shares
      outstanding
              
              $
              49,307,924.00
              
              
              $
              49,240,000.00





On August
19, 2009, the Company had a one (1) for four (4) forward split of the
outstanding Zurvita Holdings, Inc. common stock. The record date for the forward
split was August 11, 2009 but has retroactive treatment to be effective as of
January 25, 2008.  The number of issued and outstanding common shares
prior to and subsequent to the effect of the forward split was 14.11 million and
56.44 million, respectively.  The Company’s calculation of Earnings
Per Share has reflected this stock split.





Management’s Assessment of
Liquidity





Since the
Company’s inception, the Company has primarily met its operating cash
requirements through equity contributions from The Amacore Group, Inc., who was
the Company’s sole shareholder prior to the July 30, 2009 share exchange between
the Company and Zurvita, Inc.  Since the share exchange, the Company
has sold several series of preferred stock for gross proceeds of $3.75
million. We are using the proceeds from the sale of preferred stock to
subsidize the Company’s operations as the Company’s revenues are not currently
sufficient to support the Company’s current operations.





The
Company believes that its cash resources, together with increasing revenue and
assuming the continued support of its related party stockholders, will be
sufficient to sustain current planned operations for the next 12 months. The
Company raised $3.75 million from the sale of preferred stock in two tranches
completed in July 2009 and October 2009.   Additional cash resources
may be required should the Company not meet its sales targets, exceed its
projected operating costs, wish to accelerate sales or complete one or more
acquisitions or if unanticipated expenses arise or are
incurred.





The
Company does not currently maintain a line of credit or term loan with any
commercial bank or other financial institution and has not made any other
arrangements to obtain additional financing.  We can provide no
assurance that we will not require additional financing.  Likewise, we
can provide no assurance that if we need additional financing that it will be
available in an amount or on terms acceptable to us, if at all.  If we
are unable to obtain additional funds when they are needed or if such funds
cannot be obtained on terms favorable to us, we may be unable to execute our
business plan or pay our costs and expenses as they are incurred, which could
have a material, adverse effect on our business, financial condition and results
of operations.





At July
31, 2009, the Company had positive working capital of approximately $647
thousand and an accumulated deficit of approximately $9.8
million.  For the seven months ended July 31, 2009, the Company had a
net loss of approximately $3.5 million.


F-8





NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





The
accompanying consolidated financial statements for Zurvita Holdings, Inc.
(referred to herein as the “Company,” “Zurvita Holdings,” “we,” “us” or “our”)
and its subsidiaries have been prepared in accordance with accounting principles
generally accepted in the United States of America.





Revenue
Recognition





Membership
Fees





The
Company recognizes revenues from membership fees as earned for the sales of
health-related discount benefit plans and other lifestyle discount benefit
programs, such as household protection and personal financial
services.   These arrangements are generally renewable monthly
and revenue is recognized over the renewal period.  As these products
often include elements sold through contracts with third-party providers, the
Company considers each contractual arrangement in accordance with EITF 99-19,
Reporting Revenue Gross as a Principal versus Net as
an Agent(EITF 99-19). The Company’s current contracts meet the
requirements of EITF 99-19 for reporting revenue on a gross basis. The Company
records a reduction in revenue for estimated refunds, chargebacks from credit
card companies, and allowances based upon experience and management’s evaluation
of current facts and circumstances. Refunds and chargebacks totaled
approximately $66 and $80 thousand for the seven months ended July 31, 2009 and
the period from January 25, 2008 (Date of Inception) through December 31, 2008,
respectively.  An estimate for refunds and chargebacks of
approximately $10 thousand is included in accrued expenses in the accompanying
consolidated balance sheets as of July 31, 2009 and December 31,
2008.





Commissions





The
Company is paid a commission for its sales of third-party products. Commissions
are recognized as products are sold and services performed and the Company has
accomplished all activities necessary to complete the earnings
process.





Marketing
Fees and Materials





The
Company markets certain of its products through a multi-level sales organization
whereby independent distributors establish their own network of associates. The
independent distributors pay the Company a fee to become marketing
representatives on behalf of the Company. In exchange, the representatives
receive access, on an annual basis, to various marketing and promotional
materials and tools as well as access to customized management reports;
accordingly, revenue from marketing fees is recognized over an annual
period.  The Company also earns ancillary revenue from the sale of
marketing materials recognized when marketing materials are provided to the
representatives.





Concentration of Credit
Risk





At
certain times during the year, the Company’s bank deposits exceed the amounts
insured by the FDIC. As of seven months ended July 31, 2009, the Company had
$1.1 million in excess of FDIC insured limits.  Should the financial
institution cease operations when the Company’s deposit balances exceed FDIC
insured limits, it would be a significant disruption to the Company’s cash
flow.  Management continually monitors the Company’s banking
relationships to lessen this risk.  Additionally, all of the Company’s
credit card processing is with one merchant processor, as well as all
multi-level marketing sales commission payments are calculated by a third-party
service provider.





Use of
Estimates





The
preparation of the Company’s consolidated financial statements in conformity
with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.  The accounting
estimates requiring a high degree of  management’s subjective judgment
include sales refund, capitalization of certain assets, depreciable/amortizable
lives, the expected volatility of common stock, and the fair value of common
stock and warrants issued for services or in connection with the sale of
redeemable preferred stock.  Due to the uncertainty inherent in such
estimates, actual results may differ from those estimates.





Accounts
Receivable





Accounts
receivable are stated at estimated net realizable value.  Accounts
receivable are primarily comprised of balances due from memberships, net of
estimated allowances for uncollectible accounts.  In determining
collectability, historical trends are evaluated and specific customer issues are
reviewed to arrive at appropriate allowances. At July 31, 2009 and December 31,
2008, no allowance was recorded.


F-9





Property, Plant and
Equipment





Property,
plant and equipment are recorded at cost.  The cost of additions and
improvements are capitalized, while maintenance and repairs are charged to
expense as incurred.  The Company provides for depreciation and
amortization using the straight-line method over the estimated useful lives of
the property as follows: computer hardware, 3 years; furniture and fixtures, 7
years; equipment and machinery, 5 years; and leasehold improvements, the shorter
of the term of the lease or the life of the asset.  When assets are
retired or otherwise disposed of, the assets and related accumulated
depreciation are eliminated from the accounts and the resulting gain or loss is
reflected in the results of operations.





Share-Based
Compensation





The
Company accounts for share-based payments in accordance with Statement of
Financial Accounting Standards No. 123R, Share Based Payment (SFAS
123R).  SFAS 123R requires that the cost resulting from all share-based
payment transactions, including those awarded by the parent, be recognized in
the financial statements.  SFAS 123R establishes fair value as the
measurement objective in accounting for share-based payment arrangements and
requires all entities to apply a fair-value-based measurement method in
accounting for share-based payment transactions.  The Company uses the
Black-Scholes Option Pricing Model in computing fair value of warrant instrument
issuances.  The fair value of share based compensation awarded by the
majority stockholder is reflected as share based compensation expense and as a
capital contribution in the Company’s financial statements over the requisite
service period.





Convertible
Instruments





The
Company reviews the terms of convertible preferred stock for indications
requiring bifurcation, and separate accounting, for the embedded conversion
feature. Generally, embedded conversion features where the ability to physical
or net-share settle the conversion option is not within the control of the
Company are bifurcated and accounted for as derivative financial instruments.
(See Derivative
Financial Instruments below). Bifurcation of the embedded derivative
instrument requires allocation of the proceeds first to the fair value of the
embedded derivative instrument with the residual allocated to the host
instrument. The resulting discount to the redemption value of convertible
preferred securities is accreted through periodic charges to dividends over the
period to the earliest conversion date using the effective interest rate
method.





Derivative Financial
Instruments





The
Company generally does not use derivative financial instruments to hedge
exposures to cash-flow or market risks. However, certain other financial
instruments, such as detachable warrants and the embedded conversion features of
preferred instruments that are indexed to the Company’s common stock are
classified as liabilities when either (a) the holder possesses rights to
net-cash settlement or (b) physical or net share settlement is not within the
control of the Company. In such instances, net-cash settlement is assumed for
financial accounting and reporting. Such financial instruments are initially
recorded at fair value and subsequently adjusted to fair value at the close of
each reporting period. Fair value for option-based derivative financial
instruments is determined using the Black-Scholes Option Pricing
Model.





Beneficial
conversion features in preferred stock instruments that are not derivative
financial instruments are accounted for pursuant to Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjustable
Conversion RatiosEITF 98-5 and  Application of Issue No. 98-5 to
Certain Convertible InstrumentsEITF 00-27 by recording the intrinsic
value of the embedded conversion feature as a discount from the initial value of
the instrument and accreted back to face value to the earliest conversion date
using the effective interest rate method.





Income
Taxes





We
account for income taxes under Statement of Financial Accounting Standards No.
109, Accounting for Income
Taxes (SFAS 109).  Under SFAS 109, deferred tax assets and
liabilities are recognized for future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases.  Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
reverse.  The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.





We also
follow guidance of Financial Accounting Standards Board’s Interpretation No. 48,
Accounting for Uncertainty in
Income Taxes — An Interpretation of FASB Statement No. 109 (FIN 48). FIN
48 clarified the accounting for uncertainty in an enterprise's financial
statements by prescribing a recognition threshold and measurement attribute for
the financial statement recognition and measurement of a tax position taken or
expected to be taken in a tax return. FIN 48 requires us to evaluate our open
tax positions that exist on the date of initial adoption in each
jurisdiction.


F-10





When tax
returns are filed, it is highly certain that some positions taken would be
sustained upon examination by the taxing authorities, while others are subject
to uncertainty about the merits of the position taken or the amount of the
position that would be ultimately sustained.  The benefit of a tax
position is recognized in the financial statements in the period during which,
based on all available evidence, we believe it is more likely than not that the
position will be sustained upon examination, including the resolution of appeals
or litigation processes, if any.  Tax positions taken are not offset
or aggregated with other positions.  Tax positions that meet the
more-likely-than-not recognition threshold are measured as the largest amount of
tax benefit that is more than 50 percent likely of being realized upon
settlement with the applicable taxing authority.  The portion of the
benefits associated with tax positions taken that exceeds the amount measured as
described above is reflected as a liability for unrecognized tax benefits in the
accompanying balance sheet along with any associated interest and penalties that
would be payable to the taxing authorities upon examination. Interest and
penalties associated with unrecognized tax benefits are classified as income tax
expense in the statement of operations.





Fair Value
Measurements





On
January 25, 2008, we adopted Statement of Financial Accounting Standard No. 157
Fair Value Measurements
(SFAS 157).  SFAS 157 defines fair value as the price that would be
received to sell an asset or paid to transfer a liability (an exit price) in the
principal or most advantageous market for the asset or liability in an orderly
transaction between market participants on the measurement date. In many cases,
the exit price and the transaction (or entry) price will be the same at initial
recognition.  However, in certain cases, the transaction price may not
represent fair value. Prior to SFAS 157, the fair value of a liability was often
based on a settlement price concept, which assumed the liability was
extinguished.  Under SFAS 157, fair value is based on the amount that
would be paid to transfer a liability to a third party with the same credit
standing. SFAS 157 requires that fair value be a market-based measurement in
which the fair value is determined based on a hypothetical transaction at the
measurement date, considered from the perspective of a market
participant.  Accordingly, fair value is no longer determined based
solely upon the perspective of the reporting entity.  When quoted
prices are not used to determine fair value, SFAS 157 requires consideration of
three broad valuation techniques: (i) the market approach, (ii) the income
approach, and (iii) the cost approach.  SFAS 157 requires that
entities determine the most appropriate valuation technique to use, given what
is being measured and the availability of sufficient inputs.  SFAS 157
prioritizes the inputs to fair valuation techniques and allows for the use of
unobservable inputs to the extent that observable inputs are not
available.  SFAS 157 establishes a three-level hierarchy, based on the
priority of the inputs to the respective valuation technique.  The
fair value hierarchy gives the highest priority to quoted prices in active
markets for identical assets or liabilities (Level 1) and the lowest priority to
unobservable inputs (Level 3).  An asset or liability’s classification
within the fair value hierarchy is based on the lowest level of significant
input to its valuation.  SFAS 157 defines the input levels as
follows:





Level
      1
            Unadjusted
      quoted prices in active markets for identical assets or
      liabilities.





Level
      2
            Quoted
      prices in markets that are not active or inputs that are observable either
      directly or indirectly. Level 2 inputs include quoted prices for similar
      assets or liabilities other than quoted prices in Level 1, quoted prices
      in markets that are not active, or other inputs that are observable or can
      be derived principally from or corroborated by observable market data for
      substantially the full term of the assets or
  liabilities.





Level
      3
            Unobservable
      inputs that are supported by little or no market activity and are
      significant to the fair value of the assets or
      liabilities.  Unobservable inputs reflect the reporting entity’s
      own assumptions about the assumptions that market participants would use
      in pricing the asset or liability.  Level 3 assets and
      liabilities include those whose values are determined using pricing
      models, discounted cash flow methodologies, or similar techniques, as well
      as those for which the determination of fair value requires significant
      management judgment or estimation.





Earnings Per
Share





The
Company follows the provisions of Statement of Financial Accounting Standard
No. 128, Earnings Per
Share (SFAS 128) which requires the disclosure of basic and diluted
earnings per common share for all periods presented.  Earnings (loss)
per share are computed using the basic and diluted calculations on the face of
the statement of operations. Basic earnings (loss) per share are calculated by
dividing net income (loss) available to common stockholders by the weighted
average number of shares of common stock outstanding for the period. Diluted
earnings (loss) per share is calculated by dividing the net income (loss) by the
weighted average number of shares of common stock outstanding for the period,
adjusted for the dilutive effect of common stock equivalents, using the treasury
stock method. Convertible debt and warrants, officer, employee and non-employee
stock options that are considered potentially dilutive are included in the fully
diluted shares calculation as long as the effect is not
anti-dilutive.  Contingently issuable shares are included in the
computation of basic loss per share when the issuance of the shares is no longer
contingent.


F-11





Reclassifications





Certain
amounts within the operating expense category of the statement of operations for
the period year have been reclassified to conform to the current period
presentation.





Subsequent
Events





The
Company has evaluated subsequent events through November 12, 2009, the date on
which the financial statements were issued.  See Note 20 for a
discussion of subsequent events noted.





Recent Accounting
Pronouncements





We have
reviewed accounting pronouncements and interpretations thereof that have
effectiveness dates during the periods reported and in future periods. We
believe that the following impending standards may have an impact on our future
filings.  The applicability of any standard is subject to the formal
review of our financial management and certain standards are under
consideration.





In April
2009, Financial Accounting Standards Board (“FASB”) issued Staff Position FSP
No. FAS 107-1 and Accounting Principles Board Opinion (“APB”) 28-1,
“Interim Disclosures about Fair Value of Financial Instruments,” (“FSP No. FAS
107-1”).  This FSP amends Statement No. 107, “Disclosures about
Fair Value of Financial Instruments,” to require disclosures about fair value of
financial instruments for interim reporting periods of publicly traded companies
as well as in annual financial statements. This FSP also amends APB Opinion
No. 28, “Interim Financial Reporting,” to require those disclosures in
summarized financial information at interim reporting periods. This FSP is
effective for interim reporting period ending after June 15, 2009.  As
this pronouncement is only disclosure-related, it did not have an impact on our
financial position and results of operations. The Company’s adoption of FSP
No. 107-1 and APB 28-1 is not expected to have a material impact on the
Company’s consolidated financial position, results of operations and cash
flows.




In
June 2009, the FASB issued FASB Statement No. 166, “Accounting for
Financial Assets – an amendment of FASB Statement No. 140” (“SFAS
No. 166”). SFAS No. 166 is a revision to FASB Statement No. 140,
“Accounting for Transfers and Servicing of Financial Assets and Extinguishment
of Liabilities” and will require more information about transfers of financial
assets, including securitization transactions, and where companies have
continuing exposure to the risks related to transferred financial assets. It
eliminates the concept of a “qualifying special-purpose entity”, changes the
requirements for derecognizing financial assets, and requires additional
disclosures. SFAS No. 166 is effective for financial asset transfers
occurring after the beginning of an entity’s first fiscal year that begins after
November 15, 2009. Early adoption is prohibited. The Company’s adoption of
SFAS No. 166 is not expected to have a material impact on the Company’s
consolidated financial position, results of operations and cash
flows.




In July
2009, the FASB Accounting Standards Codification (“Codification”) became the
single source of authoritative generally accepted accounting principles (“GAAP”)
in the United States. The previously existing GAAP hierarchy consisted of four
levels of authoritative accounting and reporting guidance (levels A through D),
including original pronouncements of the FASB, Emerging Issues Task Force
abstracts and other accounting literature. The Codification eliminates this
hierarchy and replaced the previously existing GAAP (other than rules and
interpretive releases of the SEC) with just two levels of literature:
authoritative and nonauthoritative.  This statement is effective for
financial statements issued for interim and annual periods ending after
September 15, 2009.





Other
recent accounting pronouncements issued by the FASB (including its Emerging
Issues Task Force), the AICPA, and the SEC did not, or are not believed by
management to, have a material impact on our present or future financial
statements.





NOTE
3 – NONCASH INVESTING AND FINANCING ACTIVITIES





The
following table presents a summary of the various noncash investing and
financing transactions that the Company entered into during  the seven
months ended July 31, 2009 and for the period from January 25, 2008 (Date of
Inception) through December 31, 2008.


F-12











For
      the Seven
                Months
      Ended
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Accounts
      payable paid directly by majority stockholder
              
              $
              -
              
              
              $
              225,104Deferred
      marketing agreement
              
              
              657,400
              
              
              
              -





NOTE
4 – AGENT ADVANCED COMPENSATION





The
Company entered into loan agreements with certain of its independent sales
agents which represent advanced compensation.  The agreements have an
approximately 2 year term; however, if an agent is still selling for the Company
at the maturity date then the note is forgiven.  Therefore, the
Company is expensing them over the term of the loan.  The expense is
recognized in selling and marketing expenses on the statement of operations as
it is not directly related to sales of product or
services.  Approximately $472 thousand and $298 thousand of expense
was recognized for the seven months ended July 31, 2009 and the period from
January 25, 2008 (Date of Inception) through December 31, 2008,
respectively.  As of July 31, 2009 the balance of the loans was
approximately $1.2 million.




NOTE
5 – DEFERRED MARKETING AGREEMENT





On July
30, 2009, Zurvita entered into an Advertising and Marketing Agreement with
OmniReliant Holdings, Inc., a shareholder, and issued 15.2 million shares
of common stock.  The marketing agreement is capitalized at the
Company’s estimated fair value of the stock and amortized over the life of the
agreement which has a one-year contract term.  See Footnote 10 –
Assets and Liabilities Measured at Fair Value for further information on the
Company’s determination of fair value.  No amortization was taken for
the seven months ended July 31, 2009.





NOTE
6 – PROPERTY, PLANT AND EQUIPMENT, NET





Property,
Plant and Equipment, net of accumulated depreciation, consist of the following
at July 31, 2009 and December 31, 2008:





Successor
              
              
              PredecessorJuly
      31, 2009
              
              
              December
      31, 2008Computer
      hardware
              
              $
              18,943
              
              
              $
              18,943Furniture
      and fixtures
              
              
              43,969
              
              
              
              43,969Equipment
      and machinery
              
              
              25,168
              
              
              
              25,168Leasehold
      improvements
              
              
              55,560
              
              
              
              55,560143,640
              
              
              
              143,640Less
      accumulated depreciation
              
              
              (31,604
              )
              
              
              (11,882
              )Total
              
              $
              112,036
              
              
              $
              131,758





Depreciation
expense for the seven months ended July 31, 2009 and the period from January 25,
2008 (Date of Inception) through December 31, 2008 was approximately $20
thousand and approximately $12 thousand, respectively.





F-13





NOTE
7 – NOTES PAYABLE





Notes
payable consist of the following:





July
      31, 2009
              
              
              December
      31, 2008Promissory
      note payable; bearing interest of 7.5% per annum; unsecured; principal
      payments due monthly approximately $27 thousand through July
      2011
              
              $
              549,014
              
              
              $
              -Promissory
      note payable to related parties (on demand; noninterest bearing;
      unsecured)
              
              
              523,190
              
              
              
              -Total
      notes payable
              
              $
              1,072,204
              
              
              $
              -





Of the
notes payable presented in the preceding table, $787 thousand is classified as
current maturities as of July 31, 2009.





The
following is a schedule of the future maturity payments required under the
Company’s promissory notes payable.





As
      of July 31, 20092010
              
              $
              787,2372011
              
              
              284,9672012
              
              
              -2013
              
              
              -2014
              
              
              -Thereafter
              
              
              -$
              1,072,204




On August
4, 2009, the note payable to The Amacore Group, Inc. was paid off in the amount
of approximately $523 thousand





NOTE
8 – ACCRUED EXPENSES





Accrued
expenses consist of the following at July 31, 2009 and December 31,
2008:




Successor
              
              
              PredecessorJuly
      31, 2009
              
              
              December
      31, 2008Commissions
              
              $
              97,023
              
              
              $
              -Marketing
      materials
              
              
              -
              
              
              
              8,485Payroll
              
              
              29,252
              
              
              
              38,981Professional
      fees-legal
              
              
              3,118
              
              
              
              594,420Refund
      reserve
              
              
              10,000
              
              
              
              10,000Rent
              
              
              -
              
              
              
              7,642Sales
      tax payble
              
              
              8,608
              
              
              
              4,930Total
              
              $
              148,001
              
              
              $
              664,458





NOTE
9- DEFERRED REVENUE





Deferred
revenue consists of the following at July 31, 2009 and December 31,
2008:




Successor
              
              
              PredecessorJuly
      31, 2009
              
              
              December
      31, 2008Deferred
      marketing fees
              
              $
              787,603
              
              
              $
              974,939Deferred
      member fees
              
              
              146,718
              
              
              
              110,737Total
              
              $
              934,321
              
              
              $
              1,085,676


F-14





NOTE
10 – ASSETS AND LIABILITIES MEASURED AT FAIR VALUE





Financial
instruments which are measured at estimated fair value in the consolidated
financial statements include certain non-compensatory warrants.  The
fair value of these warrants was determined by an independent expert valuation
specialist using the Black-Scholes Option Pricing Model.





Assets
and liabilities measured at estimated fair value and their corresponding fair
value hierarchy is summarized as follows:





For
      the Seven Month Period Ended July 31, 2009Fair
      Value Measurements at Reporting Date UsingSignificant
                Unobservable
                Inputs
                (Level
      3)
              
              
              Total
                Fair
      ValueDeferred
      Marketing Costs
              
              $
              657,400
              
              
              $
              657,400Total
      Assets
              
              $
              657,400
              
              
              $
              657,400Warrants
              
              $
              549,780
              
              
              $
              549,780Total
      liabilities
              
              $
              549,780
              
              
              $
              549,780




The
Company has categorized its assets and liabilities measured at fair value into
the SFAS 157 three-level fair value hierarchy, based upon the priority of inputs
to respective valuation techniques.  Assets included within level 3 of
the fair value hierarchy presented in the preceding table include a marketing
agreement which is not required to be fair valued on a recurring
basis.  Liabilities included within level 3 of the fair value
hierarchy presented in the preceding table include certain warrants which
require fair value on a recurring basis.  The valuation methodology
uses a combination of observable and unobservable inputs in calculating fair
value.





With
respect to the deferred marketing agreement which gave rise to the deferred
marketing costs, there was no quoted market price for the Company’s securities
at the date the Company issued common stock as consideration. Consequently, the
Company utilized an independent expert valuation specialist to determine the
fair value of stock issued.  The common stock’s fair value was
estimated to be $0.04325 per share.  This estimate utilized the
Company’s July 30, 2009 sale of convertible preferred stock with common stock
warrants.  This was the Company’s sole issuance of securities for
cash.  The conversion price of the preferred stock was
$0.0625.  The common stock was valued by subtracting the $0.04 fair
value of warrants using the Black-Scholes Option Pricing Model from the
conversion price of $0.0625.  The deferred marketing costs will not be
subject to fair value measuring on a recurring basis.





The
changes in level 3 liabilities measured at fair value on a recurring basis
during the seven months ended July 31, 2009 are summarized as
follows:




Balance
                  Beginning
                  of
      Period
                
                
                Issuance
                
                
                (Gain)
      or Loss Recognized in Earning from
                  Change
      in
                  Fair
      Value
                
                
                Balance
      End
                  of
      PeriodWarrants
                
                $
                -
                
                
                $
                549,780
                
                
                $
                -
                
                
                $
                549,780








Fair
Value of Financial Instruments





The fair
values of accounts receivable, accounts payable and accrued expenses approximate
their carrying values due to the short term nature of these
instruments.  The fair values of notes payable approximate their
carrying amounts as interest rates on these obligations are representative of
estimated market rates available to the Company on similar
instruments.  The promissory note payable to the related party is
non-interest bearing, yet due to its short-term nature its representative of
fair value.





F-15





NOTE
11—REDEEMABLE PREFERRED STOCK





The
Company is authorized to issue 10 million shares of preferred stock with a par
value of $0.0001 per share.





On July
30, 2009 the company issued 1.75 million shares of Series A Convertible
Preferred Stock (the “Convertible Preferred Stock”) for proceeds of $1.75
million which are convertible at a conversion price of $0.0625 (the “Conversion
Price”) into 28 million shares (the “Conversion Shares”) of common
stock.  The proceeds of $1.75 million were allocated between the
preferred stock and detachable warrants based on the relative fair values of
$1.21 million and $540 thousand, respectively.  The stated value of each
issued share of Convertible Preferred Stock is $1.00 (the “Stated
Value”).  Significant rights of the Convertible Preferred Stock are
discussed below:





Dividends





The
Convertible Preferred Stock does not accrue dividends.





Voting
Rights





Each
holder of the shares of Convertible Preferred Stock shall have the right to the
number of votes equal to the number of Conversion Shares then issuable upon
conversion of the Convertible Preferred Stock held by such holder in all matters
as to which shareholders are required or permitted to vote, and with respect to
such vote, such holder shall have full voting rights and powers equal to the
voting rights and powers of the holders of Common Stock, and shall be entitled
to vote, together with the holders of Common Stock as a single class, with
respect to any question upon which holders of Common Stock have the right to
vote; provided, however, as to any holder of Convertible Preferred Stock, the
right to vote such shares shall be limited to the number of shares issuable to
such holder pursuant to certain beneficial ownership limitations (as listed
below) as of the record date for such vote.  To the extent permitted
under applicable corporate law, but subject to certain limitations on corporate
actions as disclosed below, the Corporation’s shareholders may take action by
the affirmative vote of a majority of all shareholders of the Company entitled
to vote on an action.  Without limiting the generality of the
foregoing, the Company may take any of the actions by the affirmative vote of
the holders of a majority of the Convertible Preferred Stock and the Common
Stock and other voting common stock equivalents, voting together as one
class.





As long
as any shares of Convertible Preferred Stock are outstanding, the Company shall
not, without the written consent or affirmative vote of the holders of no-less
than 51 percent of the then outstanding stated value of the Convertible
Preferred Stock consenting or voting as a separate class from the common stock,
the Company shall not, either directly or by amendment, merger, consolidation or
otherwise:





(i) amend
its certificate or articles of incorporation in any manner that adversely
affects the rights of the holders of Convertible Preferred Stock;





(ii) alter
or change adversely the voting or other powers, preferences, rights, privileges,
or restrictions of the  Convertible Preferred Stock;





(iii) increase
the authorized number of shares of preferred stock or  Convertible
Preferred Stock or reinstate or issue any other series of preferred
stock;





(iv)  redeem,
purchase or otherwise acquire directly or indirectly any junior securities or
any shares pari passu with the Convertible Preferred Stock;





(v) directly
or indirectly pay or declare any dividend or make any distribution in respect
of, any junior securities, or set aside any monies for the purchase or
redemption (through a sinking fund or otherwise) of any junior securities or any
shares pari passu with the Convertible Preferred Stock;





(vi) authorize
or create any class of stock ranking as to dividends, redemption or distribution
of assets upon a liquidation senior to or otherwise pari passu with the
Convertible Preferred Stock; or





(vii) enter
into any agreement with respect to any of the foregoing.





Liquidation
Preferences





Upon any
liquidation, dissolution or winding-down of the Company, whether voluntary or
involuntary (a “Liquidation”), the holders of the shares of Convertible
Preferred Stock shall be paid in cash, before any payment shall be paid to the
holders of common stock, or any other junior stock, an amount for each share of
Convertible Preferred Stock held by such holder equal to the sum of the Stated
Value thereof (such applicable amount payable with respect to a share of
Convertible Preferred Stock sometimes being referred to as the “Individual
Preferred Liquidation Preference Payment” and with respect to all shares of
Convertible Preferred Stock in the aggregate sometimes being referred to as the
“Aggregate Liquidation Preference Payment”).  If, upon such
liquidation, dissolution or winding-up of the Company, whether voluntary or
involuntary, the assets to be distributed among the holders of shares of
Convertible Preferred Stock shall be insufficient to permit payment to the
holders of Convertible Preferred Stock of an aggregate amount equal to the
Aggregate Liquidation Preference Payment, then the entire assets of the
Corporation to be so distributed shall be distributed ratably among the holders
of Convertible Preferred Stock (based on the Individual Preferred Liquidation
Preference Payments due to the respective holders of Convertible Preferred
Stock).





F-16





The
liquidation value of Convertible Preferred Stock was $1.75 million as of July
31, 2009.





Conversion
Rights





Each
share of Convertible Preferred Stock shall be convertible, at the option of the
holder thereof, at any time after the original issue date (subject to beneficial
ownership limitations as listed below), and without the payment of additional
consideration by the holder thereof, into such number of fully-paid and
nonassessable shares of common stock as is determined by dividing the Stated
Value per share, by the Conversion Price in effect at the time of
conversion.  The Conversion Price originallyshall be $0.0625;
provided, however, that the Conversion Price, and the rate at which shares of
Convertible Preferred Stock may be converted into shares of common stock, shall
be subject to adjustment as a result of stock dividends, stock splits, and
subsequent equity sales at a price lower than the Convertible Preferred Stock’s
Conversion Price. Shares of Convertible Preferred Stock converted into common
stock shall be canceled and shall not be reissued.





Beneficial Ownership
Limitations





The
Company shall not affect any conversion of the Convertible Preferred Stock, and
a holder shall not have the right to convert any portion of the Convertible
Preferred Stock, to the extent that, after giving effect to the conversion, such
holder (together with such holder’s affiliates, and any other person or entity
acting as a group together with such holder or any of such holder’s affiliates)
would beneficially own in excess 4.99% of the number of shares of the common
stock outstanding immediately after giving effect to the issuance of shares of
common stock issuable upon conversion of Convertible Preferred Stock held by the
applicable holder.  The Beneficial Ownership Limitation provisions may
be waived by such holder, at the election of such holder, upon not less than
sixty one (61) days’ prior notice to the Company, to change the Beneficial
Ownership Limitation to 9.99% of the number of shares of the common stock
outstanding immediately after giving effect to the issuance of shares of common
stock upon conversion of Convertible Preferred Stock held by the applicable
holder and the provisions of this section shall continue to
apply.  Upon such a change by a holder of the Beneficial Ownership
Limitation from such 4.99% limitation to such 9.99% limitation, the Beneficial
Ownership Limitation shall not be further waived by such holder.





Redemption Rights of the
Company





Shares of
the Convertible Preferred Stock shall be redeemable, in whole or in part, at the
option of the Company, by resolution of its Board of Directors at any time after
the original issue date and before the first (1st) anniversary of the original
issue date at a price equal to one hundred and ten percent (110%) of the Stated
Value.





Redemption Rights of
Holder





The
Convertible Preferred Stock is redeemable for cash in an amount representing the
Stated Value of outstanding Convertible Preferred Stock. The following events
give rise to a redemption triggering event:





·
            The
      Company shall be party to a change of control
  transaction;





·
            The
      Company shall fail to have available a sufficient number of authorized and
      unreserved shares of common stock to issue to such holder upon a
      conversion;





Unless
      specifically addressed elsewhere in the Convertible Preferred Stock’s
      Certificate of Designation as a Triggering Event, the Corporation shall
      fail to observe or perform any other covenant, agreement or warranty
      contained in the Certificate of Designation, and such failure or breach
      shall not, if subject to the possibility of a cure by the Company, have
      been cured within 20 calendar days after the date on which written notice
      of such failure or breach shall have been
  delivered;





·
            There
      shall have occurred a bankruptcy event or material monetary
      judgment;





If the
Company fails to pay the redemption amount as a result of a triggering event on
the date it is due, interest will accrue at a rate equal to the lesser of 18%
per year, or the maximum rate permitted by applicable law, accruing daily from
the date of the triggering event until the amount is paid in
full.


F-17








Events
that may result in the redemption for cash of preferred stock, and that are not
within a company’s control, may require the preferred stock to be classified
outside of stockholders’ equity (in the mezzanine section), as required in EITF
D-98 Classification and
Measurement of Redeemable Securities (EITF D-98). All of the above
triggering events are presumed not to be within our control. Accordingly, these
instruments are recorded in our balance sheet in the caption Redeemable
Preferred Stock, which is outside of stockholders’ equity.  Management
estimates the probability of the triggering events to be remote due to the
Company’s affiliation with stockholders that represent a majority of
the outstanding common and preferred stock.  Therefore, the carrying
value of the preferred stock has not been increased to the full redemption
value.  The reason the carrying value is not equal to the redemption
amount is due to the allocation of value to certain warrants issued in
connection with the preferred stock.  The warrants were valued at $540
thousand and the remaining proceeds were allocated to the preferred stock of
$1.21 million.





Convertible
Preferred Stock outstanding as of July 31, 2009 and December 31, 2008, was 1.75
million shares and 0 shares, respectively.





NOTE
12 - COMMON STOCK





The
Company has authorized 100 million common shares with a par value of $0.0001 per
share.   On all matters required by law to be submitted to a vote
of the holders of common stock, each share of common stock is entitled to one
vote per share.





On July
31, 2009, the Company’s majority shareholder effected the Company’s adoption of
a long-term incentive stock plan (the “2009 Incentive Stock Plan”). A maximum of
6 million shares of common stock has been authorized to be issued under the 2009
Incentive Stock Plan in connection with the grant of awards, subject to
adjustment for corporate transactions, including, without limitation, any stock
dividend, forward stock split, reverse stock split, merger or recapitalization.
Common stock issued under the 2009 Incentive Stock Plan may be either newly
issued shares, treasury shares, reacquired shares or any combination thereof. If
common stock issued as restricted stock, restricted stock units or otherwise
subject to repurchase or forfeiture rights is reacquired by us pursuant to such
rights, or if any award is cancelled, terminates, or expires unexercised, the
common stock which would otherwise have been issuable pursuant to such awards
will be available for issuance under new awards.





The Board
of Directors has the discretion to select to whom awards will be granted; to
determine the type, size, terms and conditions of each award; to modify or
waive, within certain limits, the terms and conditions of any award; to
determine the time when awards will be granted; to establish performance
objectives; to prescribe the form of documents representing awards under the
2009 Incentive Stock Plan; and to make all other determinations which it deems
necessary, advisable or desirable in the interpretation and administration of
the 2009 Incentive Plan. The Board’s decisions are final, conclusive and
binding.





On August
19, 2009, the Company had a one (1) for four (4) forward split of the
outstanding Zurvita Holdings, Inc. common stock. The record date for the forward
split was August 11, 2009 but has retroactive treatment to be effective as of
January 25, 2008.  The number of issued and outstanding common shares
prior to and subsequent to the effect of the forward split was 14.11 million and
56.44 million, respectively.





NOTE
13 – NON-COMPENSATORY WARRANTS





During
the seven month period ended July 31, 2009 the Company issued warrants to
purchase an aggregate of approximately 7.14 million shares of common
stock.  Due to the forward stock split discussed in Note 1, at July
31, 2009, there were approximately 28.6 million warrants outstanding to purchase
common stock, exercisable at $0.0625 per share through 2016.





Certain
of these warrants are liability instruments issued in conjunction with preferred
stock while others are non-compensatory warrants classified as liability
instruments.  These warrants are classified as liability instruments
in accordance with EITF Issue No. 00-19 Accounting for Derivative Financial
Instruments Indexed to and potentially settled in a Company’s Own Stock
as net share settlement is not considered within the Company’s control. As of
July 31, 2009, approximately 28.6 million warrants were classified as
liabilities.  No warrants were issued, exercised, canceled or expired,
outstanding or exercisable at December 31, 2008.





Assumptions
used to determine the fair value of the stock options and warrants granted for
the seven months ended July 31, 2009 are as follows.  There is no
fair value of stock options and warrants granted at December 31,
2008.





Weighted
      average values:Expected
      dividends
                0%Expected
      volatility
                65%Risk
      free interest rate
                3.22%Expected
      life
                5 -
      7 years


F-18





A summary
of the status of the Company's non-compensatory warrants classified as
liabilities on the balance sheet is presented below.





Warrants
              
              
              Weighted
                Average
                Exercise
                Price
              
              
              Weighted
                Average
                Remaining
                Contractual
                Term
              
              
              Aggregate
                Intrinsic
                ValueOutstanding
      at January 1, 2009
              
              
              -
              
              
              $
              -
              
              
              
              -
              
              
              $
              -Issued
              
              
              28,560,000
              
              
              
              0.06
              
              
              
              6.96
              
              
              
              -Exercised
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -Cancelled
      or Expired
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -Outstanding
      at July 31, 2009
              
              
              28,560,000
              
              
              $
              0.06
              
              
              
              6.96
              
              
              $
              -Exercisable
      at July 31, 2009
              
              
              28,560,000
              
              
              $
              0.06
              
              
              
              6.96
              
              
              $
              -





The
following table summarizes the status of warrants outstanding at July 31,
2009:





Range
      of
                Exercise
                Prices
              Number
      of
                Warrants
              Weighted
                Average
                Exercise
                Price
              Weighted
                Average
                Remaining
                Contractual
      Life
                in
      Years$0.01
      to $0.49
              28,560,000
              $    0.06
              6.96





As of
July 31, 2009, there was no unrecognized compensation cost related to non-vested
warrants as all warrants outstanding are vested.  There were no
warrants exercised during the seven months ended July 31, 2009 and the period
from January 25, 2008 (Date of Inception) through December 31, 2008 and
therefore no intrinsic value associated.  The total fair value of
warrants vested during the seven months ended July 31, 2009 was approximately
$550 thousand.  The weighted average grant date fair value of warrants
granted during the seven months ended  July 31, 2009 and the period
from January 25, 2008 (Date of Inception) through December 31, 2008 was $0.02
and $0, respectively.





A summary
of the status of the Company's non-vested shares as of July 31, 2009, and the
changes during the seven months ended July 31, 2009, is presented
below.





Warrants
              
              
              Weighted
                Average
                Grant-Date
                Fair
      ValueNon-vested
      at January 1, 2009
              
              
              -
              
              
              $
              -Granted
              
              
              28,560,000
              
              
              
              0.02Vested
              
              
              (28,560,000
              )
              
              
              -Forfeited
              
              
              -
              
              
              
              -Non-vested
      at July 31, 2009
              
              
              -
              
              
              $
              -





Share-Based
Expense





For the
seven months ended July 31, 2009, the Company issued to Midtown, for consulting
services, a warrant to purchase up to 140 thousand shares of Common Stock at an
initial exercise price of $0.25 per share.  Due to the stock split
discussed in Note 1, the number of warrants increased to 560 thousand and the
exercise price has been adjusted to $0.0625 per share.  The Company
recognized $11 thousand share-based expense within the Statement of
Operations.  The Company recognized $0 expense for the period from
January 25, 2008 (Date of Inception) through December 31, 2008.





F-19





NOTE 14 – COMPENSATORY WARRANTS AND
STOCK




During
2008, Amacore granted to Mr. Jarvis 800 thousand warrants to purchase common
stock in connection with his employment agreement with the
Company.  In the event the warrants are exercised, Amacore will issue
the corresponding authorized and available common stock to Mr.
Jarvis.  The contractual term of the warrants issued was five
years.






The fair
value of each warrant is estimated on the date of the grant using the
Black-Scholes Option Pricing Model that uses the assumptions noted in the
following table.  Expected volatility is based on the historical
volatility of the parent’s common stock.    The risk-free
rate for periods within the contractual life of the warrant is based on the U.S.
Treasury Strip yield curve in effect at the time of grant.  The
expected term of warrants granted represents the period of time that warrants
are expected to be outstanding.  The Company has estimated the
expected life to be equal to the contractual life due to the limited history of
exercised warrants.






Assumptions
used to determine the fair value of the warrants granted are as
follows:






Weighted
      average values:Expected
      dividends
              0%Expected
      volatility
              65%Risk
      free interest rate
              3.22%Expected
      life
              5 -
      7 years






During
the seven months ended July 31, 2009 and the period from January 25, 2008 (Date
of Inception) through December 31, 2008, the Company recognized stock-based
compensation expense related to the issuance of the compensatory warrants to Mr.
Jarvis, within the statement of operations in the amount of approximately $180
thousand and $164 thousand, respectively.






As of
July 31, 2009, all compensation costs related to warrants had been recognized as
Amacore had accelerated the vesting conditions of the original award subsequent
to December 31, 2008.  As of July 31, 2009 there were 800 thousand
warrants outstanding and exercisable.  During the seven months ended
July 31, 2009, 800 thousand warrants vested.  No warrants expired, nor
were any warrants exercised or forfeited during the seven months ended July 31,
2009. The intrinsic value of warrants exercised as of July 31, 2009 was
$0.  As of July 31, 2009 the weighted average exercise price of
warrants granted was $0.60.  As of July 31, 2009 the weighted average
grant date fair value of warrants granted was $0.43.




Stock Awards
Issued





On July
30, 2009, the Company granted Mr. Jarvis 1.8 million shares of common stock, to
be held in escrow, in connection with the execution of an employment agreement
and pursuant to the Company’s 2009 Incentive Stock Plan.  These shares
will be issued to Mr. Jarvis is accordance with the vesting period or upon
completion of certain performance measures (Note 17).  Due to the
forward stock split discussed in Note 1, the amount of shares were increased to
7.2 million shares of common stock.  The shares shall be subject to a
vesting period which 3.6 million shares shall vest on July 30, 2010 and July 30,
2011, respectively.  The grant date fair value was $180. For the
seven months ended July 31, 2009, no stock-based compensated expense was
recognized.





NOTE 15
- INCOME TAXES





The
Company accounts for income taxes under FASB Statement No. 109, "Accounting for
Income Taxes (FASB 109)." Deferred income tax assets and liabilities are
determined based upon differences between financial reporting and tax bases of
assets and liabilities and are measured using the enacted tax rates and laws
that will be in effect when the differences are expected to
reverse.










F-20




The
components of the income tax provision (benefit) are as follows:





Successor
              
              
              PredecessorFor
      the Period
                from
                January
      1, 2009
                through
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Current
              
              $
              19,144
              
              
              $
              16,133Deferred
              
              
              -
              
              
              
              -Total
              
              $
              19,144
              
              
              $
              16,133




Deferred
income taxes reflect the net tax effects of temporary differences between the
carrying amount of assets and liabilities for financial reporting purposes and
the amounts used for income tax purposes. Significant components of the
Company's net deferred income taxes are as follows:





Successor
              
              
              PredecessorFor
      the Period from January 1, 2009
                through
                July
      31, 2009
              
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Deferred
      tax assets:Depreciation
      of property, plant and equipment
              
              $
              7,632
              
              
              $
              -Other
              
              
              10,062
              
              
              
              3,400Net
      operating loss carryforward
              
              
              3,032,861
              
              
              
              2,124,496Gross
      deferred tax asset
              
              
              3,050,555
              
              
              
              2,127,896Less
      Valuation Allowance
              
              
              (3,050,555
              )
              
              
              (2,110,683
              )Gross
      deferred tax asset
              
              
              -
              
              
              
              17,213Deferred
      tax liabilities:Depreciation
      of property, plant and equipment
              
              
              -
              
              
              
              (17,213
              )Gross
      deferred tax liability
              
              
              -
              
              
              
              (17,213
              )Total
      deferred tax asset
              
              $
              -
              
              
              $
              -





The
company files as part of a consolidated US tax group with its
parent.  The consolidated amount of current and deferred tax expense
is allocated using the benefits of loss method to members of the
group.





SFAS 109
requires a valuation allowance to reduce the deferred tax assets reported if,
based on the weight of the evidence, it is more likely than not that some
portion or all of the deferred tax assets will not be realized. After
consideration of all the evidence, both positive and negative, management has
determined that a $3.1 million valuation allowance at July 31, 2009 is necessary
to reduce the deferred tax assets to the amount that will more likely than not
be realized. The change in the valuation allowance for the current year is $940
thousand.  At July 31, 2009, the Company has available net operating
loss carryforwards of $9 million, of which, $5.5 million expires in tax year
ending 2028 and $3.5 million expires in tax year ending 2029.





The
Company adopted the provisions of Financial Accounting Standards Board (“FASB”)
Interpretation No. 48, “Accounting for Uncertainty in Income Taxes, an
Interpretation of FASB Statement No. 109” (“Interpretation No. 48”),
on January 25, 2008. Among other things, FIN 48 requires application of a “more
likely than not” threshold to the recognition and non-recognition of tax
positions. It further requires that a change in judgment related to prior years’
tax positions be recognized in the quarter of such change.   The
Company does not currently have any tax position liability recorded. The tax
year ended December 31, 2008 remains open to examination by the major taxing
jurisdictions to which the Company is subject.





F-21





Below is
a reconciliation of the statutory federal income tax rate to the Company’s
effective tax rate for the seven months ended July 31, 2009 and the period from
January 25, 2008 (Date of Inception) through December 31, 2008:






Successor
              
              
              
              
              
              
              PredecessorFor
      the Seven MonthsEnded
                July
      31, 2009
              
              
              
              
              
              
              For
      the Period from
                January
      25, 2008
                (Date
      of Inception)
                through
                December
      31, 2008Tax
      provision at U.S. federal income tax rate
              
              $
              (1,197,887
              )
              
              
              (34.00
              %)
              
              $
              (2,110,683
              )
              
              
              (34.00
              %)State
      income tax provision net of federal
              
              
              19,144
              
              
              
              0.54
              %
              
              
              16,133
              
              
              
              0.26
              %Meals
      & Entertainment
              
              
              2,684
              
              
              
              0.08
              %
              
              
              -
              
              
              
              0.00
              %Prior
      year true up of Valuation Allowance
              
              
              255,330
              
              
              
              7.25
              %
              
              
              -
              
              
              
              0.00
              %Change
      in Valuation Allowance
              
              
              939,873
              
              
              
              26.68
              %
              
              
              2,110,683
              
              
              
              34.00
              %Provision
      for income taxes
              
              $
              19,144
              
              
              
              0.54
              %
              
              $
              16,133
              
              
              
              0.26
              %




NOTE
16 - EARNINGS (LOSS) PER SHARE







The
Company follows the provisions of SFAS No. 128, Earnings Per Share (SFAS 128)
which requires the disclosure of basic and diluted earnings per common share for
all periods presented.  Earnings (loss) per share are computed using
the basic and diluted calculations on the face of the statement of operations.
Basic earnings (loss) per share are calculated by dividing net income (loss)
available to common stockholders by the weighted average number of shares of
common stock outstanding for the period. Diluted earnings (loss) per share is
calculated by dividing the net income (loss) by the weighted average number of
shares of common stock outstanding for the period, adjusted for the dilutive
effect of common stock equivalents, using the treasury stock method. Convertible
debt and warrants, officer, employee and non-employee stock options that are
considered potentially dilutive are included in the fully diluted shares
calculation as long as the effect is not anti-dilutive.  Contingently
issuable shares are included in the computation of basic loss per share when the
issuance of the shares is no longer contingent.





As
discussed in Note 1, the Company initiated a forward stock split of one (1) for
four (4) shares outstanding.  The Company’s calculation of Earnings
Per Share has reflected this stock split.





The
following is the computation of basic and diluted net earnings (loss) per common
share for the seven months ended July 31, 2009 and the period from January 25
2008 (Date of Inception) to December 31, 2008:





Successor
            
            
            PredecessorFor
      the Seven
              Months
      Ended
              July
      31, 2009
            
            
            For
      the Period from January 25, 2008
              (Date
      of Inception) through
              December
      31, 2008Numerator:Net
      loss
            
            $
            (3,542,340
            )
            
            $
            (6,224,023
            )Denominator:Weighted
      average basic and fully diluted shares outstanding
            
            
            49,307,924
            
            
            
            49,240,000Net
      loss per common share - basic and diluted
            
            $
            (0.07
            )
            
            $
            (0.13
            )





During
the seven months ended July 31, 2009 and the period from January 25, 2008 (Date
of Inception) through December 31, 2008, the effect of outstanding exercisable
warrants and convertible preferred stock were not included within the Company’s
earnings (loss) per share calculation as their effect would be
anti-dilutive.





F-22





Securities
that could potentially dilute earnings per share in the future, but which were
not included in the calculation of diluted earnings per share because to do so
would have been anti-dilutive for the periods presented, are as
follows:




Successor
              
              
              PredecessorFor
      the Seven
                Months
      Ended
                July
      31, 2009
              
              For
      the Period from January 25, 2008
                (Date
      of Inception) through
                December
      31, 2008Potentially
      dilutive securities outstanding at end of period:Common
      stock warrants
              
              
              28,560,000
              
              
              
              -Convertible
      preferred stock
              
              
              28,000,000
              
              
              
              -Weighted-average
      common share equivalents outstanding
              
              
              268,057
              
              
              
              -





NOTE 17
- COMMITMENTS AND CONTINGENCIES





The
Company is committed under a lease of office space through July 31,
2012.  For the seven months ended July 31, 2009 and for the period
January 25, 2008 (Date of Inception) through December 31, 2008, rent expense was
approximately $75 thousand and $76 thousand, respectively.





The
following is a schedule of future minimum lease payments required under the
Company leased office.





As
      of July 31, 20092010
            
            $
            92,5112011
            
            
            106,8082012
            
            
            106,8082013
            
            
            -2014
            
            
            -Thereafter
            
            
            -$
            306,127





Employment
Agreement with Mark Jarvis





Immediately
following the closing of the Share Exchange Transaction, the Company entered
into an employment agreement with Mark Jarvis (the “Jarvis Agreement”),
pursuant to which Mr. Jarvis agreed to serve as Co-CEO of the Company for a term
of two years.  Pursuant to the Jarvis Agreement, Mr. Jarvis shall
receive annual compensation of $480 thousand (the “Base Salary”).  Mr.
Jarvis shall also be entitled certain other benefits, including health
insurance, as may be provided to other comparable executives of Zurvita
Holdings.  In addition, within 30 days of the execution of the Jarvis
Agreement, the Company shall place 1.8 million shares of the Company’s common
stock in escrow on behalf of Mr. Jarvis pursuant to the Company’s 2009 Incentive
Stock Plan (the “Initial Jarvis Shares”). The Initial Jarvis Shares shall be
subject to a vesting period pursuant to which (i) 900.6 thousand shares shall
vest on July 30, 2010, and (ii) 900 thousand shares shall vest on July 30,
2011.  In addition, in the event that for the first quarter ending six
months after July 30, 2009 Zurvita Holdings is cash flow positive, the Company
shall, within 30 days of the Company filing its Form 10-Q, issue to Mr. Jarvis
1.8 shares if such shares were issued on July 30, 2009 would own 5% of the
issued and outstanding shares of the Company (the “Performance Shares”).
Alternatively, for the two quarters ending six (6) months after Start-Up Period,
(“Extended Measuring Quarters”), should the average Zurvita Holdings monthly
cash flow during the Extended Measuring Quarters, as documented on the monthly
cash flow statements, and verified in the Quarterly Report(s), be operationally
cash flow positive, the Performance Shares shall be issued to
Executive.  The Performance Shares shall be issued under the Company’s
2009 Incentive Stock Plan and shall be subject to a one year vesting period from
the time of initial grant.  In addition to his Base Salary, Mr. Jarvis
shall also be eligible to receive certain incentive bonus compensation (the
“Incentive Bonus”) based upon the revenue generated by Zurvita
Holdings.  Mr. Jarvis’ Incentive Bonus shall be calculated as 10% of
Zurvita Holdings net income.  If Mr. Jarvis’ employment is terminated
by the Company as a result of his disability (as such term is defined in the
Jarvis Agreement), Mr. Jarvis shall be entitled to receive a lump sum payment
equal to his (i) accrued but unpaid Base Salary, (ii) any outstanding expense
reimbursements, (iii) any accrued but unpaid Incentive Bonus, (iv) a monthly
amount, which when added to any amounts received by Mr. Jarvis from any
disability policy in effect at the time of his disability, will equal Mr.
Jarvis’ Base Salary for the 12 month period following the date of disability
termination.


F-23





NOTE
18 - LEGAL PROCEEDINGS





Other
than the following legal proceedings listed below that were settled the seven
months ended July 31, 2009, there have been no events under any bankruptcy act,
no criminal proceedings and no judgments, injunctions, orders or decrees
material to the evaluation of the ability and integrity of any director,
executive officer, promoter or control person of Company during the past five
years.





As
previously reported in the 10-K of Amacore for the year ended December 31, 2008
as filed with the SEC on March 31, 2009, Amacore, initiated an action, Case No.
DC-08-01101-K), on January 30, 2008, in an attempt to clarify its rights to
engage in business with Mark Jarvis and various other
individuals.   The action, Mark Jarvis and Zurvita, Inc. v.
AmeriPlan Corp. v. Allen Masters v. The Amacore Group, Inc., Patty Duke, Rusty
Duke, Gail Weitl and Rick Weitl (the “Action”),was filed in the 192nd Judicial District Court of
Dallas County Texas.  Mr. Jarvis was a former employee of AmeriPlan
Corporation (“AmeriPlan”) who, along with certain others that were formerly
associated with AmeriPlan, left AmeriPlan to work at
Zurvita.  AmeriPlan responded to the action by asserting counterclaims
against Zurvita, Mr. Jarvis and others that were formerly associated with
AmeriPlan for breach of contract, breach of fiduciary duties, breach of duty of
loyalty, tortuous interference with contractual relations, misappropriation of
confidential information, conversion, unfair competition, and
conspiracy.  In response to the counterclaims, the Company and
Amacore, on behalf of Zurvita Holdings and its employees, asserted numerous
affirmative defenses to the claims.





On July
9, 2009, Amacore entered into a Mutual Compromise Settlement Agreement and
General Release of Claims (the “Settlement Agreement”) with AmeriPlan, Zurvita,
TransMark Financial Services, Inc. and Mark Jarvis.  Pursuant to the
Settlement Agreement and in consideration for the dismissal of all claims and
counterclaims of the Action, Amacore and Zurvita agreed to settle with AmeriPlan
for a sum of $1.8 million of which $1.2 million was paid by Amacore and Zurvita
Holdings agreed to issue a promissory note to AmeriPlan in the principal amount
of $600 thousand bearing interest at a rate of 7.5% per annum, payable in 24
monthly installments of approximately $27 thousand beginning on July 1, 2009 and
each month thereafter until paid in full (the “Note”).  In connection
with the issuance of the Note, Amacore entered into a Guaranty Agreement (the
“Guaranty”), pursuant to which Amacore guaranteed the payment of the Note by
Zurvita.  The Company recognized a loss on settlement of $600 thousand
which is included in professional fees in the accompanying consolidated
statement of operations.








NOTE 19
- RELATED PARTY TRANSACTIONS





During
the seven months ended July 31, 2009 and the period from January 25, 2008 (Date
of Inception) to December 31, 2008, the Company received approximately $2.6
million and $5.7 million of equity contributions from its majority stockholder,
Amacore, respectively.





During
the seven months ended July 31, 2009, the Company entered into a promissory note
in the amount of approximately $523 thousand payble to its majority stockholder,
Amacore.  The promissory note is a non-bearing interest note and is
payable upon demand.  As of July 31, 2009, the principal balance
remains outstanding.





There are
immediate family members of Mr. Jarvis who operate as Independent Business
Owners (“IBO”) who were paid agent advances and commission compensation which
amounted to approximately $37 thousand and approximately $37 thousand,
respectively, for the seven months ended July 31, 2009, for work in which they
perform on behalf of the Company.





Repurchase
Agreement





Zurvita
Holdings also entered into the Repurchase Agreement with Mr. Taylor, pursuant to
which the Company repurchased from Mr. Taylor an aggregate of 8 million shares
of Common Stock, which represented 66.7 percent of the Company’s shares of
Common Stock then issued and outstanding, for an aggregate purchase price of
$210 thousand.





Agreement
with OmniReliant Holdings, Inc.





Zurvita
Holdings entered into an Advertising and Marketing Agreement with OmniReliant
Holdings, Inc., shareholder, pursuant to which Zurvita agreed to provide
placement of advertising for OmniReliant on its website and OmniReliant agreed
to provide Zurvita with certain marketing services.  The marketing
services to be provided by OmniReliant include the production of infomercials,
video production services, management of call centers, buying and fulfillment
services.  In consideration for such services, OmniReliant received an
aggregate of 15.2 million shares of the Company’s common stock which was valued
at $657 thousand.


F-24





Agreement
with Amacore Group, Inc.





Zurvita
Holdings entered into a Marketing and Sales Agreement with its majority
stockholder, Amacore, pursuant to which Amacore agreed to provide certain
services to Zurvita Holdings.  In addition, pursuant to the Amacore
Agreement, Zurvita shall continue to have the right to benefit from certain
agreements which Amacore maintains with product and service
providers.  Zurvita shall pay Amacore $13 thousand monthly for these
services.





NOTE
20 - SUBSEQUENT EVENTS





Amendment
of Certificate of Incorporation





On August
19, 2009, Red Sun Mining, Inc. filed with the State of Delaware a Certificate of
Amendment of Certificate of Incorporation, pursuant to which Red Sun Minning,
Inc. changed its name to Zurivta Holdings, Inc. and affected a one (1) for four
(4) forward split of the outstanding Zurvita Holdings, Inc..common stock. The
record date for the forward split was August 11, 2009.  The number of
issued and outstanding common shares prior to and subsequent to the effect of
the forward split was 14.11 million and 56.44 million,
respectively.





On October
6, 2009, the Company entered into a Securities Purchase Agreement with an
accredited investor, pursuant to which the Company issued and sold 2
million shares of its newly designated Series B Convertible Preferred Stock (the
“Series B Preferred Stock”) and Series B Common Stock Purchase Warrants (the
“Series B Warrants”) to purchase an aggregate of 8 million shares of the
Company’s common stock.





Sale
of Unregistered Securities





The
Series B Preferred Stock is convertible into shares of the Company’s common
stock at an initial conversion price of $0.0625 per share, subject to
adjustment.  The holders of the Company’s Series B Preferred Stock
shall have the right to the number of votes equal to the number of shares
issuable upon conversion of the Series B Preferred Stock.  In
addition, so long as any shares of Series B Preferred Stock are outstanding, the
Company cannot, without the written consent of the holders of 51% of the then
outstanding Series B Preferred Stock: (i) amend its articles of incorporation in
any manner that adversely affects the rights of the holders; (ii) alter or
change adversely the voting or other powers, preferences, rights, privileges, or
restrictions of the Series B Preferred Stock; (iii) increase the authorized
number of shares of preferred stock or Series B Preferred Stock or reinstate or
issue any other series of preferred stock; (iv) redeem, purchase or otherwise
acquire directly or indirectly any Junior Securities (as such term is defined in
the certificate of designation of the Series B Preferred Stock) or any shares
pari passu with the Series B Preferred Stock; (v) directly or indirectly
pay or declare any dividend or make any distribution in respect of, any Junior
Securities, or set aside any monies for the purchase or redemption (through a
sinking fund or otherwise) of any Junior Securities or any shares
pari passu with the Series B Preferred Stock; (vi) authorize or create any
class of stock ranking as to dividends, redemption or distribution of assets
upon a Liquidation (as such term is defined in the certificate of designation of
the Series B Preferred Stock) senior to or otherwise pari passu with the
Series B Preferred Stock; or (vii) enter into any agreement with respect to any
of the foregoing.  The holders of the Company’s Series B Preferred
Stock shall also have liquidation preferences over the holders of the Company’s
common stock.  The Series B Preferred Stock also contain anti-dilution
provisions, including but not limited to if the Company issues shares of its
common stock at less than the then existing conversion price, the conversion
price of the Series B Preferred Stock will automatically be reduced to such
lower price and the number of shares to be issued upon exercise will be
proportionately increased.  The Series B Preferred Stock also contains
limitations on exercise, including the limitation that the holders may not
convert their shares to the extent that upon exercise the holder, together with
its affiliates, would own in excess of 4.99% of the Company’s outstanding shares
of common stock (subject to an increase upon at least 61-days’ notice by the
investor to the Company, of up to 9.99%).





The
Series B Warrants are exercisable for a term of seven years at an exercise price
of $0.0625 per share.  The Series B Warrants also contain
anti-dilution provisions, including but not limited to if the Company issues
shares of its common stock at less than the then existing conversion price, the
conversion price of the Series B Warrants will automatically be reduced to such
lower price and the number of shares to be issued upon exercise will be
proportionately increased.  The Series B Warrants contain limitations
on exercise, including the limitation that the holders may not convert their
Series B Warrants to the extent that upon exercise the holder, together with its
affiliates, would own in excess of 4.99% of the Company’s outstanding shares of
common stock (subject to an increase upon at least 61-days’ notice by the
investor to the Company, of up to 9.99%).





Purchase
of Unregistred Securities





On
October 9, 2009 (the “First Closing Date”), the Company entered into a
Securities Purchase Agreement (the “Agreement”) with Beyond Commerce, Inc.
(“Beyond Commerce”), pursuant to which the Company agreed to purchase an
aggregate of 8 million shares of common stock of Beyond Commerce at a price per
share of $0.10 for aggregate consideration of $800,000.  The closing
of the transaction was subject to certain conditions, including but not limited
to, the acquisition of certain software assets of Beyond Commerce by OmniReliant
Holdings, Inc. (“OmniReliant”) and the Company’s entry into a license agreement
with OmniReliant (as described below) covering such software.





F-25





Pursuant
to the terms of the Agreement, on the First Closing Date, the Company purchased
3 million shares of common stock.  In addition, the Company agreed to
purchase an additional 2 million shares on the date on which the Company is able
to sell ads. The Company agreed to acquire 1 million shares on October 23, 2009
and 2 million shares on the date on which the entire sales, operational and
technical transition has taken place allowing OmniReliant and the Company to
operate independently on their own platform, which shall occur no later than
November 1, 2009.





Execution
of License and Marketing Agreement





On
October 9, 2009, the Company entered into a license and marketing agreement (the
“License Agreement”) with OmniReliant whereby OmniReliant granted a perpetual
right and license, under all intellectual property rights applicable to the
LocalAdLink Software (the “Software”), to access, use, execute, display, market,
and sell the Software to the Company in consideration for a royalty fee of $2.00
per user for a period of twenty four (24) months, commencing ninety (90) days
from the date the Company runs its first advertisement.  Additionally,
pursuant to the terms of the License Agreement, OmniReliant granted the Company
the right to market and sell the Software through its independent sales
representatives in consideration for a 6% promissory note in the principal
amount of $2 million, payable three (3) years from the date of issuance and
convertible at any time at the option of OmniReliant at a conversion price of
$0.0625 per share.
















































F-26