1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December
19, 2000.
MIRADOR DIVERSIFIED SERVICES, INC.
(Formerly TCT Financial Group B, Inc.)
Nevada 0-28197 88-0431561
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
675 Lynnhaven Parkway 2nd Floor, Virginia Beach VA 23452
(Address of Principal Executive offices)
Registrant's telephone number, including area code: (757)463-9646
Item 1. Changes in Control of Registrant
None
Item 2. Acquisition or Disposition of Assets
None
Item 3. Bankruptcy or receivership
Not Applicable.
Item 4. Changes in Registrant's Certifying Public
Accountant
Not Applicable.
Item 5. Other Events
Mirador has formed several key partnerships. Mirador has
formed a partnership with Golden State Mutual Life Insurance
Company of California. Under this agreement Mirador will
begin training more than 500 independent and employee sales
agents through an agreement between Mirador and this 78-year-
old insurance carrier. The insurance carrier partner will
pay a fee for all the new business generated by the FNA.
Another Partnership has been reached with Legacy Unlimited a
privately owned Broker Dealer sales organization, marketers
of insurance products and mutual fund investments. Golden
State and Legacy pay a fee for all new mutual fund and
insurance sales generated by the FNA. Insurance agents will
earn a fee for each loan application they generate that can
be converted into a closed loan. This is a three-way
partnership between Golden State Mutual Life Insurance
Company, Legacy Unlimited and Mirador Diversified Services,
Inc. This agreement will allow each company to cross sell to
each other's client base.
Additionally, Legacy has more than 200 securities broker
dealers that will be trained and assisted to become
insurance licensed. The training will also consist of how to
use a Financial Needs Analysis (FNA) software program
designed to assist the agents to determine their clients'
financial and investment needs and offer financial
solutions. Those solutions are likely to include mortgage
loans when debt consolidation would be in order as well as
other services offered by Mirador such as insurance policies
and mutual fund investments (sales written by the
appropriately licensed agents).
Mirador will operate as a net branch for a large regional
bank in states where Mirador does not hold a license. This
will allow Mirador to write mortgage loans in 45 states. As
a result of this agreement Mirador will be able to
concentrate on loan production and maintain very low back
office staff.
Mirador will be able to offer the sales staff and consumers
an online loan application and follow up.
Item 6. Resignation of Registrant's Directors
None
Item 7. Financial Statements and Exhibits
Mirador Diversified Services, Inc.
Consolidated
Balance Sheet
As of October 31, 2000
Oct 31,
'00
ASSETS
Current Assets
Checking/Savings
Bank One 374.11
Keybank - Operating -23,734.57
Total Checking/Savings -23,360.46
Accounts Receivable
Accounts Receivable 15,000.00
Total Accounts Receivable 15,000.00
Other Current Assets
Cash on Hand 4,671.38
Employee Advances 200.00
Total Other Current Assets 4,871.38
Total Current Assets -3,489.08
Fixed
Assets
Accumulated Depreciation
Computers -19,132.40
Furniture & Fixtures -22,424.83
Vehicles -15,448.58
Total Accumulated
Depreciation -57,005.81
Equipment
Computers 30,701.87
Vehicles 24,530.23
Equipment - Other 149.00
Total Equipment 55,381.10
Furniture & Fixtures 25,606.03
Total Fixed Assets 23,981.32
Other
Assets
Investment 400.00
Investment - Arrngton Homes 28,914.69
Mortgage Loan Receivable 34,250.26
Organizational Costs 400.00
Refundable Deposits 925.00
Total Other Assets 64,889.95
TOTAL ASSETS 85,382.19
LIABILITIES & EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable 20,837.48
Total Accounts Payable 20,837.48
Other Current Liabilities
Bank Loan - LOC 14,663.90
Note Payable
TB Financial -122,893.03
Note Payable -
Other -13,909.36
Total Note Payable -136,802.39
Payroll Liabilities
OCC Withholding -75.53
Payroll Liabilities 20,582.78
- Other
Total Payroll 20,507.25
Liabilities
Total Other Current
Liabilities -101,631.24
Total Current Liabilities - 80,793.76
Total Liabilities - 80,793.76
Equity
Additional Paid In Capital 160,000.00
Common Stock 69,105.11
Opening Bal Equity -3,658.89
Retained Earnings - 60,307.39
Net Income 1,037.12
Total 166,175.95
Equity
TOTAL LIABILITIES & EQUITY 85,382.19
Mirador Diversified Services, Inc.
Consolidated
Statement of Income
For the period ended October 31, 2000
Oct '00 Feb - Oct'00
Ordinary Income/Expense
Income
Fees 42,994.07 380,064.49
Total Income 42,994.07 380,064.49
Expense
Advertising 269.78 2,062.96
Automobile Expense 553.51 1,685.18
Bank Service Charges 23.95 2,171.88
Commission 503.01 21,237.61
Cost of Sales
Appraisal Fees 5,409.12 46,463.46
Credit Reports 2,049.30 12,860.75
Freight/Express 295.98 4,562.28
Origination Labor 0.00 1,325.00
Costs
Cost of Sales - 1,371.95 2,835.01
Other
Total Cost of Sales 9,126.35 68,046.50
Dues and Subscriptions 0.00 651.43
Insurance
Health 0.00 743.88
Liability Insurance 0.00 307.21
Insurance - Other 1,672.22 14,873.26
Total Insurance 1,672.22 15,924.35
Interest Expense
Finance Charge 215.48 1,249.56
Total Interest Expense 215.48 1,249.56
Licenses and Permits 0.00 745.00
Office Supplies 699.58 11,015.40
Outside Services 11,298.65 95,019.23
Payroll Expenses
Officer Salary 6,309.55 48,923.02
Payroll Expenses - 4,074.59 36,566.94
Other
Total Payroll Expenses10,384.14 85,489.96
Postage and Delivery 200.00 1,030.76
Printing and 17.61 4,275.59
Reproduction
Professional 0.00 1,530.55
Development
Professional Fees
Accounting 0.00 5,540.00
Legal Fees 1,990.00 3,942.50
Total Professional 1,990.00 9,482.50
Fees
Rent 348.00 13,686.11
Repairs 900.00 3,382.50
Taxes
Local 58.50 58.50
Total Taxes 58.50 58.50
Telephone 1,720.01 19,491.90
Travel & Ent
Entertainment 108.25 985.18
Meals 20.00 101.16
Travel 2,705.00 14,027.70
Travel & Ent - 0.00 2,355.00
Other
Total Travel & Ent 2,833.25 17,469.04
Uncategorized Expenses 0.00 0.00
Utilities
Gas and Electric 0.00 3,320.86
Total Utilities 0.00 3,320.86
Total Expense 42,814.04 379,027.37
Net Ordinary Income 180.03 1,037.12
Net 180.03 1,037.12
Income
Item 8. Change in Fiscal Year
Not Applicable.
Item 9. Contracts
Golden State Mutual Life Insurance Company / Legacy
Unlimited LLC / Mirador Diversified Services, Inc.
Insurance Brokerage Agreement
This Agreement is made and entered into as of the 5th day of
December 2000 by and between Legacy Insurance Group, LLC. a
Maryland corporation (hereinafter Legacy Insurance Group),
Mirador Diversified Services, Inc. a Nevada corporation
(hereinafter (Mirador), and Golden State Mutual Life
Insurance Company a California Mutual Insurance Company
("hereinafter "Licensee").
WHEREAS, Primarily, Legacy Insurance Group and its
affiliates, and secondarily, Mirador and its affiliates
provide certain insurance services to Insurance Brokers,
Insurance General Agents and Writing Agents which assist
them in performing their business; and
WHEREAS, Mirador provides certain financial planning
services to Insurance Brokers, Insurance General Agents and
Writing Agents which assist them in performing their
business; and
WHEREAS, Licensee, who is or will become an Insurance
Broker with Legacy Insurance Group and wishes to establish
an insurance brokerage office in the states listed under
Exhibit A (the "Office") for the purpose of operating an
insurance brokerage business and to engage General Agents
and Writing Agents to conduct their business out of such
Office; and
WHEREAS, Licensee wishes to utilize certain of the
services provided by Legacy Insurance Group to assist the
Licensee, the General Agent(s), and the Writing Agent(s)
working in the Office, and Legacy Insurance Group is willing
to provide such services to Licensee.
NOW, THEREFORE, in consideration of the foregoing
premises and such other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:
1. Legacy Insurance Group - Legacy Insurance Group
hereby agrees to perform the services described in this
Agreement for Licensee:
(a) Provide systems and support personnel necessary to
introduce business to Life, Health, Annuity, and
Supplemental Insurance Carriers (the "Carriers") as
listed in Exhibit B for the origination of life,
health, annuity, and supplemental insurance contracts
and for the execution and maintenance of transactions
facilitated through each Carrier in life, health,
annuity, and supplemental insurance programs and
services.
(b) Provide customer statements and confirmations from
Carriers in good standing as determined by A.M. Best.
(c) Provide such other administrative services as
shall be determined in the sole discretion of Legacy
Insurance Group to be necessary or appropriate for the
operation of an insurance brokerage business.
(d) By the 15th calendar day following the calendar
month-end transaction date, deliver monthly
reconciliation summarizing the life, health, annuity,
and supplemental insurance business of each General
Agent and Writing Agent in each Office for the prior
month, including the date of each transaction made by
the General Agent and Writing Agent, the face amount of
each transaction, the collected premium date of each
transaction, and the amounts due to the General Agent,
Writing Agent and to the Licensee for commissions
earned on such transactions, as well as such other
information as Legacy Insurance Group shall, from time
to time, include on such reconciliation.
(e) Establish with each Carrier their disbursement schedule
for amounts due to Insurance Broker, General Agent and
Writing agent for commissions of prior month transaction
activity. Legacy Insurance Group will arrange for
commissions to be disbursed directly to the Insurance
Broker, General Agent and Writing Agent from Carrier unless
otherwise specified by Carrier.
(f) Add, subtract or delete Carriers based on suitability,
appeal, quality of service, quality of underwriting, Carrier
rating, and all other applicable reasons.
2. Compliance and Supervision - Legacy Insurance Group
and Licensee each acknowledge the regulated nature of the
insurance industry and the importance of compliance with the
rules and regulations imposed by, among others, various
state and federal regulatory authorities and Carriers.
Licensee shall at all times operate the Office in accordance
with all internal rules, regulations, policies, requests,
directives, memoranda and the like of Legacy Insurance
Group, as well as local, state and federal rules,
regulations, ordinances, and requirements, including without
limitation, those governing the operation of an insurance
brokerage office and the various state regulatory agencies
having jurisdiction over the activities of the Office and
the Licensee's General Agent(s) and Writing Agent(s).
3. Representations, Warranties and Covenants of Legacy
Insurance Group
(a) Licenses - Legacy Insurance Group shall maintain a
registration as a residence or non-residence licensed
insurance brokerage or insurance agent within the
states listed in Exhibit A. All such licenses will be
maintained and renewed on a timely basis by Legacy
Insurance Group at its sole cost and expense. Legacy
Insurance Group may secure additional state life,
health, annuity, and supplemental insurance licenses
so to provide insurance products and services for
Licensee, General Agents and Writing Agents in new
jurisdictions.
4. Representations, Warranties and Covenants of Licensee
(a) Licenses - Licensee represents and warrants that
it has secured a resident or non-resident license as
determined by Legacy Insurance Group for doing
business in such states and verification of
authorization to applicable Carriers. All such
licenses will be maintained and renewed on a timely
basis by Licensee at Licensee's sole cost and expense.
Licensee may secure additional state life, health,
annuity, and supplemental insurance licenses, provided
that prior to obtaining such licenses, notification is
given to Legacy Insurance Group.
(b) Supervision - Licensee shall diligently and regularly
monitor the activities of all General Agents and Writing
Agents operating out of the Office to insure compliance with
all rules and regulations and policies and procedures of the
state regulatory authorities, Carriers, and Legacy Insurance
Group. Any failure by any General Agent or Writing Agent to
comply with all such applicable rules and regulations,
policies, and procedures shall be promptly reported to
Legacy Insurance Group.
(c) Insurance - Licensee agrees that it and all of
its General Agents and Writing Agents shall subscribe
to at their own cost, errors and omissions insurance
in such form and amounts as determined by Licensee, to
the satisfaction of Legacy Insurance Group, including
extended reporting coverage upon the General Agent's
or Writing Agent's termination, either voluntary or
otherwise, at the cost of one (1) year's premium.
Licensee shall not allow any General Agent or Writing
Agent to conduct any life, health, annuity, and
supplemental insurance business until such errors and
omission insurance is in force and effect.
5. Commission Rate and Appointment Contract
(a) Legacy Insurance Group shall establish the Licensee's
commission rate on a carrier-by-carrier basis (refer to
Exhibit C) at which point, Licensee must complete an
appointment contract with each Carrier and Legacy Insurance
Group the Licensee decides to have its General Agents and
Writing Agents market.
(b) In addition to the carrier commission rates set
forth in Exhibit C, Licensee shall be responsible for
and shall be liable to Legacy Insurance Group for the
payment of all debts, unsecured debts, unsecured
debits, expenses, costs or charges incurred by Legacy
Insurance Group for the account of any customer or
vendor of Licensee or his/her Writing Agents
(collectively "Customer Account Losses"). Such
Customer Account Losses shall include, without
limitation, the following:
(I) The cost of any chargebacks;
(II) Carrier transaction charges;
(III) Wire transfer or draft charges;
(VI) Processing charges of Legacy Insurance
Group, overnight fees, interest charges,
postage charges, telephone charges;
(IV) Unsecured debits;
(V) Any other charge(s) which typically is/are paid by a
General Agent or Writing Agent in the Office, but, for
whatever reason, was/were not paid by the General Agent or
Writing Agent; and
(VI) Arbitration awards and civil judgments as well as
settlements thereof and arbitration fees, member surcharges,
and other court or arbitration costs incurred with any of
the foregoing or any dispute with any customer of License or
its General Agents and Writing Agents, as more fully set
forth in Paragraph six (6) below. Such payment may be
procured by Legacy Insurance Group either by reducing
amounts otherwise due from Legacy Insurance Group to
Licensee, or by requesting a check from Licensee, or any
combination thereof, at the sole option of Legacy Insurance
Group.
(b) Licensee shall be solely responsible for the payment
structure of each General Agent or Writing Agent's monthly
commission. Licensee shall deliver a schedule to Legacy
Insurance Group disclosing the Commission rates applicable
to each General Agent or Writing Agent in the Office. To
the extent that Licensee does not otherwise owe any sums to
Legacy Insurance Group, Legacy Insurance Group will
authorize the Carriers to calculate the amounts due to each
General Agent or Writing Agent, deduct such amount from the
Licensee and remit such amount to the appropriate General
Agent or Writing Agent, on Licensee's behalf.
(c) Licensee and each General Agent or Writing Agent must
have registration in states where commissions are generated.
(d) At the termination of Licensee's and/or the
General Agent or Writing Agent's association with
Legacy Insurance Group, Legacy Insurance Group shall
instruct each Carrier to hold all commissions, for a
period of thirty (30) days from the date that the last
commission checks would otherwise be due or until
Legacy Insurance Group is satisfied that all pending
or asserted claims against Legacy Insurance Group,
Licensee and/or Licensee's General Agent or Writing
Agent (s) are satisfactorily resolved, whichever is
later regardless of whether Licensee or General Agent
or Writing Agent is specifically named as a Respondent
or Defendant in any proceeding.
6. Indemnification - General Agent, Writing Agent and
Licensee shall indemnify and hold harmless Legacy Insurance
Group from and against any and all claims or actions and all
costs, expenses, losses of any kind (including without
limitation, all arbitration awards, civil judgments,
reasonable attorney fees and costs, and court, arbitration
fees, member surcharges and costs), against the Office, the
Licensee and/or a General Agent or Writing Agent in the
Office or against Legacy Insurance Group relating to the
acts or asserted acts of Licensee and/or its Writing
Agent(s), regardless of whether Licensee or Writing Agent(s)
is/are specifically named as a Respondent or Defendant in
any proceeding. Legacy Insurance Group, at its sole option,
and without the prior approval of either the Licensee or
applicable General Agent or Writing Agent may settle or
compromise any claim at any time. Licensee agrees that any
settlement entered into by Legacy Insurance Group with a
customer, vendor of Licensee or any third party shall be
binding upon Licensee, and shall conclusively determine the
amount of loss attributable to such claim. In the event
Licensee wishes to disagree with such settlement, he/she may
do so by filing a bond or depositing into an escrow account
for the benefit of Legacy Insurance Group, the amount of
damages alleged by Plaintiff or claimant. In such event,
Legacy Insurance Group will not settle the claim without the
consent of Licensee. Licensee further agrees that Legacy
may offset such costs, expenses or losses resulting from
such civil verdicts or judgments, arbitration awards and
settlements, against any monies due Licensee under this
Agreement or any addendum to this Agreement as well as
against any securities or monies contained in any individual
brokerage account which Licensee and/or the applicable
General Agent or Writing Agent may maintain with Legacy
Insurance Group, and that such offset may be made prior to
determination by any court or arbitration panel as to the
reasonableness thereof. Legacy Insurance Group may also opt
to hold monies due Licensee in advance of actual damages
being incurred by Legacy Insurance Group by notifying
Licensee and providing a reasonable explanation thereof.
7. Use of Corporate Name - Legacy Insurance Group hereby
grants to Licensee a non-assignable exclusive right to
operate the office under the name of Legacy Insurance Group,
LLC. This operating right shall be limited to dealings with
customers concerning their insurance contracts. Licensee
shall not have the right to, enter into contracts,
commitments, or incur any liabilities under the name Legacy
Insurance Group, LLC. Whether in connection with the
operation of the office or otherwise, except with customers
in the ordinary course of business.
8. Assignment - The rights granted hereunder to Licensee
are personal in nature. Any purported transfer of any such
rights (by operation of law or otherwise) not specifically
authorized pursuant to this Agreement will be void, and will
also be a breach of this Agreement. The rights granted
hereunder to Licensee, including without limitation the
right to the use of the name Legacy Insurance Group, LLC.
may not be the subject of any security interest, lien, levy,
attachment or execution by any creditor of Licensee. Legacy
Insurance Group may freely assign all of its rights and
obligations under this Agreement to any person, firm,
corporation or other entity.
9. Relationship of Parties - Except as provided for in
this Agreement, neither party is the legal representative or
agent of, or has the power to obligate the other for any
purpose whatsoever; and no partnership, joint venture,
agency, fiduciary or employment relationship is intended or
created by reason of this Agreement. It is the intent of
parties that for all federal and state tax purposes, the
Licensee shall be an independent contractor of Legacy
Insurance Group.
10. Term - This agreement shall be in full force and effect
until December 31, 2002 (with the exception of Paragraphs
4(c), 5,6, and 12, which shall survive any termination)
unless Licensee's registration is, terminated for cause,
prior thereto.
11. Non-Disclosure - Licensee shall not during the term of
this Agreement or at any time after its termination disclose
any information concerning the manner in which Legacy
Insurance Group conducts its business, including without
limitation, the names of customers of Legacy Insurance
Group, to any person or party except if so required by law.
12. Remedies - The remedies provided in this Agreement are
not exclusive, and its provisions are sever able. It will
be governed by Maryland law, it is exclusively for the
benefit of the parties hereto and it may not give rise to
liability to a third party.
13. Entire Agreement - This is the entire agreement between
the parties. It supersedes all previous agreements. No
change in this Agreement will be valid unless in writing
signed by both parties. The section headings in this
Agreement will not affect their interpretation. No failure
to require strict performance or to exercise any right or
remedy hereunder will preclude requiring strict performance
or exercising any right or remedy in the future. Legacy
Insurance Group's consent, wherever required, may be
withheld if any default by Licensee exists under this
Agreement.
14. Notices - Notices will be effective hereunder when they
are reduced to writing and delivered personally or mailed b
certified mail to the appropriate party at its address
stated below, or to such person and at such address as may
be designated by written notice hereunder. Approvals and
consents by Legacy Insurance Group will not be effective
unless evidenced in writing or by telefax and duly executed
on behalf of Legacy Insurance Group.
LICENSEE: GOLDEN STATE MUTUAL LIFE INSURANCE COMPANY, INC.
NAME:
_S/S__________________________________________________
Charles James, Vice President
BY: S/S_____________________________________________
ADDRESS: 1999 Adams Ave., Los Angeles, CA
LEGACY INSURANCE GROUP, LLC
BY: S/S
_______________________________________________________
NAME: Vernon Marrow, President
ADDRESS: 2 E. Fayette Street, Baltimore, MD 21202
MIRADOR DIVERSIFIED SERVICES, INC.
BY: S/S
_______________________________________________________
NAME: John Edward Jones, President CEO
675 Lynnhaven Parkway, 2nd Floor, Virginia Beach, VA 23452
Exhibit A
Golden State Mutual Life Insurance Company
State Insurance Brokerage Offices
Licensed to do business in:
Arizona
California
District of Columbia
Georgia
Hawaii
Illinois
Louisiana
Maryland
Michigan
Mississippi
Missouri
Nevada
North Carolina
Tennessee
Texas
Virginia
Exhibit B
Life, Health, Annuity & Supplemental Carriers
Life Insurance Carriers:
Old Line Life Insurance Company, Inc. (American General)
Security Connecticut Insurance Company, Inc.
F&G Life Insurance Company, Inc.
Disability Income Carriers:
Illinois Mutual
Annuity Carriers:
F&G Life Insurance Company, Inc.
Jackson National Life Insurance Company, Inc.
Supplemental Insurance Carriers:
AFLAC
Exhibit C
Life, Health, Annuity & Supplemental Carrier
Commission Rates for Licensee
Life Insurance Carriers:
Old Line Life Insurance Co, Inc. 100%
Security Connecticut Insurance Company, Inc. 100%
F&G Life Insurance Company, Inc. 100%
Disability Income Carriers:
Illinois Mutual 50%
Annuity Carriers (% of Gross Commission):
F&G Life Insurance Company, Inc. 85%
Jackson National Life Insurance Company, Inc. 85%
Supplemental Insurance Carriers (% of Override):
AFLAC 10%
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the Registrant has caused this report to be
signed in its behalf by the undersigned, hereunto duly
authorized.
Dated: December 19, 2000 Mirador Diversified
Services, Inc.
S/S___John Edward Jones
John Edward Jones, President
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the Registrant has caused this report to be
signed in its behalf by the undersigned, hereunto duly
authorized.
Dated: December 19, 2000 Mirador Diversified
Services, Inc.
S/S___John Edward Jones
John Edward Jones, President
