The Amacore Group, Inc., (OTC BB: ACGI), a leader in providing
membership benefit programs, insurance programs, and other
innovative and high-quality benefit solutions to individuals,
families and employer groups nationwide, announces the spin off of
its Zurvita division to Red Sun Mining, Inc. (“Red Sun”) in a
transaction that became effective July 30, 2009. Incorporated by
Amacore in 2008, Zurvita has become a wholly-owned subsidiary of
Red Sun, and will be operating under the “Zurvita, Inc.” name, with
shares being traded on the OTC Bulletin Board under the stock
symbol “RDSN.”
Based in Houston, Texas, Zurvita is a national network marketing
company that markets health, financial, technology, energy, and
consumer products to individuals, families, and businesses around
the country in a variety of sales models and channels. Pursuant to
the terms of the Share Exchange Agreement (“Share Exchange”), Red
Sun Mining issued to Amacore a total of 9,310,000 shares of Red Sun
common stock for one hundred percent of the outstanding shares of
Zurvita common stock. Jay Shafer, Amacore’s CEO, will become Co-CEO
of Red Sun, sharing the CEO role with Mark Jarvis, Zurvita’s
founder. Terms of the agreement can be found in Amacore’s Form 8-K
which was filed with the United States Securities and Exchange
Commission on August 5, 2009.
As a result of the spin off, Amacore retains a significant
investment stake in Zurvita’s new parent company, Red Sun, while
reducing the cash burn associated with Zurvita’s establishment,
growth, and expansion. Additionally, as part of the Share Exchange
Transaction, Amacore entered into a comprehensive marketing and
sales agreement with Zurvita, whereby Amacore will, at its option,
continue to provide Zurvita with a variety of administrative
services and access to key benefits Amacore maintains with third
party vendors and product and service providers.
Commenting on the spin off, Jay Shafer, Amacore’s CEO stated:
“We’re excited about this new path for Zurvita. While Amacore has
benefitted from the increased revenue growth and gross margin
contributions Zurvita has provided, its business model is unique
and best suited for this new structure. As a separate public
company, Zurvita will be able to further its entrepreneurial
operations and pursue its own growth strategy. Further, since
Zurvita has accounted for approximately fifty percent of Amacore’s
operational cash requirements in the past eighteen months, the spin
off of Zurvita will allow Amacore to significantly reduce its
monthly cash burn rate as well as its dependence on dilutive equity
financings to fund Zurvita.”
Regarding the spin off, Mark Jarvis, Zurvita co-CEO stated: “We
at Zurvita welcome this opportunity for Zurvita to boldly continue
its growth and expansion, with new products, new partners, new
channels, and in new markets, all the while remaining true to the
core values and the remarkable team that have brought us to this
point.”
Concurrent with the closing of the Share Exchange, Zurvita
entered into an Advertising and Marketing Agreement (“Advertising
Agreement”) with OmniReliant Holdings, Inc., a builder of global
consumer brands through domestic and international direct marketing
channels. Under this agreement, Zurvita will provide advertising
placement for OmniReliant on its website and OmniReliant will
provide Zurvita with certain marketing services including the
production of infomercials, video production services, management
of call centers, buying and fulfillment services. As part of the
agreement OmniReliant received 3,800,000 shares of Zurvita’s common
stock. Vicis Capital Master Fund, Amacore’s majority shareholder,
will also be a significant shareholder of Zurvita. Other terms of
the agreement can be found in Red Sun’s Form 8-K which was filed
with the United States Securities and Exchange Commission on August
5, 2009.
After the effects of the Share Exchange and Advertising
Agreement, Amacore’s investment in Red Sun represents approximately
59% of the issued and outstanding common stock and approximately
41% of the voting rights of total equity securities outstanding;
OmniReliant’s investment in Red Sun represents approximately 24% of
the issued and outstanding common stock and approximately 17% of
the voting rights of total equity securities outstanding. The
remaining 17% of the issued and outstanding common stock is held by
various investors and represents approximately 12% of the voting
rights of total equity securities outstanding.
Mr. Shafer continued: “As an equity holder of Red Sun, Amacore
will continue to benefit from Zurvita’s success. We believe the
marketing agreement that Zurvita has signed with OmniReliant has
positioned Zurvita for even greater success. Additionally, we are
pleased that Vicis’ management has given its support to this new
venture, demonstrating Vicis’ belief in Zurvita’s business plan and
path to growth.”
Mr. Shafer concluded: “The Amacore management team continues to
concentrate our efforts on reviewing and refining operations,
streamlining costs, and maximizing profitability and shareholder
value. We believe this transaction is consistent with those efforts
and in the best interests of the company and its shareholders.”
About The Amacore Group, Inc. (www.amacoregroup.com)
The Amacore Group, Inc. is primarily a provider and marketer of
healthcare related products, including healthcare benefits, vision
and dental networks, and administrative services such as billing,
fulfillment, patient advocacy, claims administration and servicing.
The company primarily markets healthcare-related membership
programs such as limited and major medical programs, supplemental
medical and discount dental programs to individuals and families.
It distributes these products and services through various
distribution methods such as its agent network, direct response
marketing companies, DRTV (direct response television), inbound
call centers, in-house sales representatives, network marketing and
affinity marketing partners. The company’s secondary line of
business is to place membership programs through these same
marketing channels. These membership programs utilize the same back
office and systems creating marketing efficiencies to provide low
cost ancillary products such as pet insurance, home warranty,
involuntary unemployment insurance, and accident insurance.
This press release contains forward-looking statements that are
subject to risks and uncertainties. These forward-looking
statements include information about possible or assumed future
results of our business, including anticipated growth and
geographic expansion, new products and services, new business
development and opportunities, anticipated revenues, possible
reduction or elimination of material weaknesses, anticipated
revenue growth, expenses, profitability, losses and profit margins.
In some cases, you may identify forward-looking statements by words
such as "may," "should," "plan," "intend," "potential," "continue,"
"believe," "expect," "predict," "anticipate" and "estimate," the
negative of these words or other comparable words. These statements
are only predictions. One should not place undue reliance on these
forward-looking statements. The forward-looking statements are
qualified by their terms and/or important factors, many of which
are outside the Company's control, involve a number of risks,
uncertainties and other factors that could cause actual results and
events to differ materially from the statements made. The
forward-looking statements are based on the Company's beliefs,
assumptions and expectations of the Company’s future performance,
taking into account information currently available to the Company.
These beliefs, assumptions and expectations can change as a result
of many possible events or factors, including those events and
factors described in "Risk Factors" in the Company’s Annual Report
on Form 10-KSB for 2008 filed with the Securities and Exchange
Commission, not all of which are known to the Company. The Company
will update the information in this press release only to the
extent required under applicable securities laws. If a change
occurs, the Company's business, financial condition, liquidity and
results of operations may vary materially from those expressed in
the aforementioned forward-looking statements.
Amacore (CE) (USOTC:ACGI)
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