TEAM FINANCIAL INC /KS
Below is a static gap schedule as of December 31, 2005. This is just one of several tools which may be used to measure and manage interest rate sensitivity. Interest-earning assets and interest-bearing liabilities are presented below within selected time intervals based on their re-pricing and maturity characteristics. In this presentation, the sensitivity position would be perfectly matched when an equal amount of assets and liabilities re-price during any given time period. Excess assets or liabilities re-pricing in a given time period results in the interest rate gap shown in the table. A positive gap indicates more assets than liabilities will re-price in that time period, while a negative gap indicates more liabilities than assets will re-price.             Static Gap Analysis at December 31, 2005                 3 months       4 through       13 through       37 through       61 through       More than                         or less       12 months       36 months       60 months       120 months       120 months       Total                 (Dollars in thousands)         Interest-earning assets:                                                                         Loans receivable, net of unearned income       $   102,512       $   137,626       $   98,700       $   52,226       $   13,043           $   16,074           $   420,181         Investment securities available for sale       10,821       10,068       13,428       13,410       39,309           103,373           190,409         Federal funds sold and interest-bearing deposits       19,768       —       —       —       —           —           19,768         Other assets       —       480       —       —       —           —           480         Total   interest-earning assets       $   133,101       $   148,174       $   112,128       $   65,636       $   52,352           $   119,447           $   630,838         Interest bearing   liabilities:                                                                         Savings deposits and interest-bearing checking       $   265,200       $   —       $   —       $   —       $   —           $   —           $   265,200         Time deposits under $100,000       39,173       78,052       46,658       4,406       16           —           168,305         Time deposits over $100,000        22,674       34,010       16,344       1,345       —           —           74,373         Federal funds purchased and securities sold   under agreements to repurchase       4,036       —       —       —       —           —           4,036         Federal Home Loan Bank Advances       5,000       3,000       27,000       5,000       70,401           730           111,131         Notes payable and subordinated debentures       202       16,005       —       —       —           —           16,207         Total interest-bearing liabilities       $   336,285       $   131,067       $   90,002       $   10,751       $   70,417           $   730           $   639,252         Periodic repricing gap       $   (203,184   )   $   17,107       $   22,126       $   54,885       $   (18,065   )       $   118,717           $   (8,414   )     Cumulative repricing gap       (203,184   )   (186,077   )   (163,951   )   (109,066   )   (127,131   )       (8,414   )                 Periodic repricing gap as a percent of   interest earning assets       (152.65   )%   11.55   %   19.73   %   83.62   %   (34.51   )%       99.39   %                 Cumulative   repricing gap as a percent of interest earning assets       (152.65   )%   (125.58   )%   (146.22   )%   (166.17   )%   (242.84   )%       (7.04   )%                   The table indicates that we are liability sensitive in the less than three-month period and the 61 through 120 month period, and are asset sensitive for all other periods. The liability sensitivity during the three months or less period is primarily due to the classification of savings and interest-bearing checking as three months or less as these funds may be withdrawn at any time. This means that during the first period classification, interest-bearing liabilities re-price faster than interest-earning assets, thereby improving net interest income when rates are falling and reducing net interest income when rates are rising. While the “static gap” method is a widely used measure of interest sensitivity, it is not, in management’s opinion, the only indicator of our interest rate sensitivity. 47    The following table indicates that at December 31, 2005, if there had been a sudden and sustained increase in prevailing market interest rates, our 2006 net interest income would be expected to increase, while a decrease in rates would indicate a decrease in net interest income.             Net Interest       (Decrease)       Percent         Change in Interest Rates               Income       Increase       Change                 (Dollars in thousands)         200 basis point   rise           $   25,234               $   1,363           5.71   %     100 basis point   rise           24,552               681           2.85         Base rate   scenario           23,871               —           —         100 basis point   decline           22,851               (1,020   )       (4.27   )     200 basis point decline           20,474               (3,397   )       (14.23   )                         We believe we are appropriately positioned for future interest rate movements, although we may experience fluctuations in net interest income due to short-term timing differences between the re-pricing of assets and liabilities. 48     Item 8.                        Financial Statements and Supplementary Data Index to Consolidated Financial Statements    Report of Independent   Registered Public Accounting Firm       50         Consolidated   Statements of Financial Condition as of December 31, 2005 and 2004       51         Consolidated   Statements of Operations for the fiscal years ended December 31, 2005,   2004, and 2003       52         Consolidated   Statements of Comprehensive Income for the fiscal years ended December 31, 2005,   2004, and 2003       53         Consolidated   Statements of Changes In Stockholders’ Equity for the fiscal years ended December 31, 2005,   2004, and 2003       54         Consolidated   Statements of Cash Flows for the fiscal years ended December 31, 2005, 2004, and 2003       55         Notes to Consolidated   Financial Statements       57          49     Report of Independent Registered Public Accounting Firm The Board of Directors and Stockholders Team Financial, Inc.: We have audited the accompanying consolidated statements of financial condition of Team Financial, Inc. and subsidiaries (the Company) as of December 31, 2005 and 2004, and the related consolidated statements of operations, comprehensive income, changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2005. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated 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 Team Financial, Inc. and subsidiaries as of December 31, 2005 and 2004, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2005, in conformity with accounting principles generally accepted in the United States of America.       /s/ KPMG LLP     Kansas City, Missouri   March 24, 2006          50     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Financial Condition December 31, 2005 and 2004 (In thousands)             2005       2004         Assets                         Cash and due from   banks       $   14,592       $   13,718         Federal funds sold   and interest bearing bank deposits       19,768       21,023         Cash and cash equivalents       34,360       34,741         Investment securities:                         Available for sale, at fair value (amortized cost of   $192,388 and $190,369 at December 31, 2005 and 2004, respectively)       190,409       191,842         Total investment securities       190,409       191,842         Loans receivable,   net of unearned fees       420,181       378,771         Allowance for loan   losses       (5,424   )   (4,898   )     Net loans receivable       414,757       373,873         Accrued interest   receivable       4,607       3,819         Premises and   equipment, net       16,359       15,317         Assets acquired   through foreclosure       455       408         Goodwill       10,700       10,700         Intangible assets,   net of accumulated amortization       3,223       3,811         Bank owned life   insurance policies       19,173       18,460         Other assets       2,486       2,830         Assets of discontinued   operations       —       8,282         Total assets       $   696,529       $   664,083         Liabilities   and Stockholders’ Equity                         Deposits:                         Checking deposits       $   186,791       $   183,650         Savings deposits       31,944       32,749         Money market deposits       46,465       49,931         Certificates of deposit       242,678       201,620         Total deposits       507,878       467,950         Federal funds   purchased and securities sold under agreements to repurchase       4,036       5,669         Federal Home Loan   Bank advances       111,131       111,915         Notes payable       202       3,544         Subordinated   debentures       16,005       16,005         Accrued expenses   and other liabilities       3,928       4,864         Liabilities of   discontinued operations       —       1,282         Total liabilities       643,180       611,229         Stockholders’ equity:                         Preferred stock, no par value. Authorized 10,000,000 shares;   no shares issued       —       —         Common stock, no par value. 50,000,000 shares   authorized; 4,499,470 and 4,496,753 shares issued; 4,034,995 and   4,034,178 shares outstanding at December 31, 2005 and 2004,   respectively       27,880       27,849         Capital surplus       417       306         Retained earnings       30,941       28,264         Treasury stock,   common stock 464,475 and 462,575 shares at cost at December 31,   2005 and 2004, respectively       (4,583   )   (4,537   )     Accumulated other   comprehensive income (loss)       (1,306   )   972         Total stockholders’ equity       53,349       52,854         Total liabilities   and stockholders’ equity       $   696,529       $   664,083           See accompanying notes to the consolidated financial statements 51     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Operations Years ended December 31, 2005, 2004, and 2003 (Dollars in thousands, except per share data)             2005       2004       2003         Interest income:                                 Interest and fees on loans       $   27,778       $   23,308       $   23,189         Taxable investment securities       7,352       7,364       7,144         Nontaxable investment securities       1,168       1,203       1,094         Other       311       100       152         Total interest income       36,609       31,975       31,579         Interest expense:                                 Deposits:                                 Checking deposits       1,124       570       554         Savings deposits       222       212       246         Money market deposits       627       493       557         Certificates of deposit       6,823       4,630       5,392         Federal funds purchased and securities sold under   agreements to repurchase       136       143       49         FHLB advances payable       4,696       4,865       4,998         Notes payable       62       125       174         Subordinated debtentures       1,553       1,553       1,553         Total interest expense       15,243       12,591       13,523         Net interest income before provision for loan losses       21,366       19,384       18,056         Provision for loan losses       (820   )   (1,465   )   (1,790   )     Net interest income after provision for loan losses       20,546       17,919       16,266         Non-interest income:                                 Service charges       3,891       3,952       3,573         Trust fees       702       664       608         Gain on sales of mortgage loans       887       1,264       2,788         Gain (loss) on sales of investment securities       (1   )   (50   )   294         Bank owned life insurance income       842       821       892         Other       1,385       1,499       1,653         Total non-interest income       7,706       8,150       9,808         Non-interest expenses:                                 Salaries and employee benefits       11,406       10,638       10,927         Occupancy and equipment       2,759       2,765       2,495         Data processing       2,851       2,528       2,190         Professional fees       1,348       1,179       1,090         Marketing       378       355       267         Supplies       322       378       381         Intangible asset amortization       616       798       823         Disposal of branch assets       —       —       258         Other       3,550       3,410       3,243         Total non-interest expenses       23,230       22,051       21,674         Net income from continuing operations before income   taxes       5,022       4,018       4,400         Income tax expense       944       222       958         Net income from continuing operations       4,078       3,796       3,442         Net income (loss) from discontinued operations, net   of tax       (108   )   (218   )   350         Net income       $   3,970       $   3,578       $   3,792         Basic income per share from continuing operations       $   1.01       $   0.93       $   0.84         Diluted income per share from continuing operations       $   1.00       $   0.93       $   0.83         Basic income per share from discontinued operations       $   (0.03   )   $   (0.05   )   $   0.09         Diluted income per share from dicontinued operations       $   (0.03   )   $   (0.05   )   $   0.09         Basic income per share       $   0.98       $   0.88       $   0.93         Diluted income per share       $   0.97       $   0.87       $   0.92         Shares applicable to basic income per share       4,038,097       4,060,587       4,095,903         Shares applicable   to diluted income per share       4,094,793       4,094,714       4,131,381           See accompanying notes to the consolidated financial statements 52     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income Years ended December 31, 2005, 2004, and 2003 (In thousands)             2005       2004       2003         Net income       $   3,970       $   3,578       $   3,792         Other comprehensive   income (loss), net of tax:                                 Unrealized gains (losses) on investment securities   available for sale, net of tax of $(1,175), $(493), and $(970) for the   years ended December 31, 2005, 2004, and 2003, respectively       (2,279   )   (958   )   (1,877   )     Reclassification adjustment for (gains) losses included   in net income, net of tax of $0, $17, and $(100) for the years ended   December 31, 2005, 2004, and 2003, respectively       1       33       (194   )     Other comprehensive income (loss), net       (2,278   )   (925   )   (2,071   )     Comprehensive   income       $   1,692       $   2,653       $   1,721           See accompanying notes to the consolidated financial statements 53     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Changes in Stockholders’ Equity Years ended December 31, 2005, 2004, and 2003 (In thousands)                                             Accumulated                                 Additional                       other       Total                 Common       paid-in       Retained       Treasury       comprehensive       stockholders’                 stock       capital       earnings       stock       income (loss)       equity         Balance, December 31, 2002           27,393               211               23,290               (3,034   )           3,968               51,828             Treasury stock purchased (50,800 shares)            —               —               —               (564   )           —               (564   )         Common stock issued in connection with compensation   plans (7,428 shares)           55               —               —               —               —               55             Contribution of shares of treasury stock to Company   ESOP (35,300 shares)           —               55               —               386               —               441             Increase in additional paid in capital in connection   with compensation plans           —               26               —               —               —               26             Net income           —               —               3,792               —               —               3,792             Dividends ($0.27 per share)           —               —               (1,103   )           —               —               (1,103   )         Other comprehensive income (loss), net of $(1,070)   in taxes           —               —               —               —               (2,071   )           (2,071   )         Balance, December 31, 2003           27,448               292               25,979               (3,212   )           1,897               52,404             Treasury stock purchased (142,992 shares)           —               —               —               (1,683   )           —               (1,683   )         Common stock issued in connection with compensation   plans (47,115 shares)           393               —               —               —               —               393             Contribution of shares of treasury stock to Company   ESOP (30,500 shares)           —               7               —               358               —               365             Decrease in additional paid in capital in connection   with compensation plans           8               (8   )           —               —               —               —             Increase in additional paid in capital in connection   with compensation plans           —               15               —               —               —               15             Net income           —               —               3,578               —               —               3,578             Dividends ($0.32 per share)           —               —               (1,293   )           —               —               (1,293   )         Other comprehensive income (loss), net of $(476)   in taxes           —               —               —               —               (925   )           (925   )         Balance, December 31, 2004           27,849               306               28,264               (4,537   )           972               52,854             Treasury stock purchased (6,100 shares)           —               —               —               (93   )           —               (93   )         Common stock issued in connection with compensation   plans (6,917 shares)           31               (18   )           —               47               —               60             Increase in additional paid in capital in connection   with compensation plans           —               129               —               —               —               129             Net income           —               —               3,970               —               —               3,970             Dividends ($0.32 per share)           —               —               (1,293   )           —               —               (1,293   )         Other comprehensive income (loss), net of $(1,175)   in taxes           —               —               —               —               (2,278   )           (2,278   )         Balance,   December 31, 2005           $   27,880               $   417               $   30,941               $   (4,583   )           $   (1,306   )           $   53,349                                                 See accompanying notes to the consolidated financial statements 54     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows Years ended December 31, 2005, 2004, and 2003 (In thousands)             2005       2004       2003         Cash flows from operating   activities:                                 Net income       $   3,970       $   3,578       $   3,792         Loss (Income) from discontinued operations       108       218       (350   )     Adjustments   to reconcile net income to net cash provided by operating activities:                                 Provision for loan losses       820       1,465       1,790         Depreciation and amortization       2,479       2,868       4,327         Contribution of common stock to ESOP       —       365       441         Deferred income taxes       (525   )   (386   )   (333   )     Noncash compensation expense       129       15       26         Change in bank owned life insurance       (713   )   (704   )   (788   )     Net (gain) loss on sales of investment securities       (1   )   50       (294   )     FHLB stock dividends       (317   )   (226   )   —         Net gain on sales of mortgage loans       (887   )   (1,264   )   (2,788   )     Net (gain) loss on sales of assets       (57   )   138       73         Disposal of branch assets       —       —       258         Proceeds from sale of mortgage loans       52,399       62,507       132,436         Origination of mortgage loans for sale       (50,456   )   (63,539   )   (121,264   )     Net (increase) decrease in other assets       (200   )   62       1,337         Net (decrease) increase in accrued expenses and other   liabilities       1,689       (217   )   (1,540   )     Net cash flows from operating activities of   discontinued operations       —       (1,486   )   911         Net cash provided by operating activities       8,438       3,444       18,034         Cash flows from investing   activities:                                 Net increase in loans       (43,256   )   (29,985   )   (16,400   )     Proceeds from sale of investment securities   available-for-sale       1,014       8,593       5,686         Proceeds from maturities and principal reductions of   investment securities available-for-sale       40,656       74,292       127,556         Purchases of investment securities available-for-sale       (44,004   )   (56,627   )   (134,684   )     Purchase of premises and equipment, net       (2,299   )   (2,820   )   (3,046   )     Proceeds from sales of assets       260       731       641         Cash paid for acquisitions       (925   )   (925   )   —         Net cash received from sale of discontinued   operations       6,892       —       —         Net cash flows from investing activities of   discontinued operations       —       753       (1,272   )     Net cash used in investing activities       (41,662   )   (5,988   )   (21,519   )     Cash flows from financing   activities:                                 Net (decrease) increase in deposits       39,928       21,791       (9,446   )     Net (decrease) increase in federal funds purchased   and securities sold under agreements to repurchase       (1,633   )   (1,511   )   2,896         Payments on Federal Home Loan Bank advances       (10,794   )   (12,098   )   (1,097   )     Proceeds from Federal Home Loan Bank advances       10,010       12,779       —         Payments on notes payable       (9,785   )   (7,990   )   (3,540   )     Proceeds of notes payable       6,443       8,312       200         Common stock issued       31       393       55         Purchase of treasury stock       (93   )   (1,683   )   (564   )     Issuance of treasury stock       29       —       —         Dividends paid on common stock       (1,293   )   (1,298   )   (1,022   )     Net cash provided by (used in) financing activities       32,843       18,695       (12,518   )     Net change in cash and cash equivalents       (381   )   16,151       (16,003   )     Cash and cash equivalents at beginning of the year       34,741       18,590       34,593         Cash and cash   equivalents at end of the year       $   34,360       $   34,741       $   18,590           See accompanying notes to the consolidated financial statements 55     TEAM FINANCIAL, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (continued) Years ended December 31, 2005, 2004, and 2003 (In thousands)             2005       2004       2003         Supplemental disclosures of   cash flow information :                                 Cash paid during   the year for:                                 Interest       $   14,611       $   12,682       $   13,596         Income taxes       804       1,404       2,055         Noncash activities   related to operations:                                 Assets acquired through foreclosure       559       2,243       549         Loans to facilitate the sale of real estate acquired   through foreclosure       336       2,106       521         Noncash activities   related to acquisitions and disposals:                                 Operating   activities:                                 Decrease in other assets       $   —       $   —       $   (45   )     Investing   activities:                                 Decrease in   premises and equipment       —       —       (213   )       See accompanying notes to the consolidated financial statements 56     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements December 31, 2005, 2004 and 2003 (1)          Summary of Significant Accounting Policies The following accounting policies, together with those disclosed elsewhere in the consolidated financial statements, represent the significant accounting policies used in presenting the accompanying consolidated financial statements. Principles of Consolidation The consolidated financial statements include the accounts of Team Financial, Inc. and its wholly owned subsidiaries, Team Financial Acquisition Subsidiary, Inc., including TeamBank, N.A. and its subsidiaries, and Post Bancorp including Colorado National Bank, all of which are collectively considered one segment. All material inter-company transactions, profits, and balances are eliminated in consolidation. Financial Statement Presentation and Use of Estimates The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, and contingent assets and liabilities as of the balance sheet dates and revenues and expenses for the reporting years. Actual results could differ from those estimates. Cash and Cash Equivalents For the purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks and federal funds sold. Securities Available-for-Sale Securities to be held for indefinite periods of time, including securities that management intends to use as a part of its asset/liability strategy that may be sold in response to changes in interest rates, loan prepayments, or other factors, are classified as available-for-sale and carried at fair value. Gains or losses on the sale of securities are determined using the specific identification method. Premiums and discounts are recognized in interest income using the interest method over the period to call date and maturity date, respectively. Unrealized holding gains or losses, net of tax, for securities available-for-sale are reported as a component of other comprehensive income (loss). A decline in the fair value of any security below cost that is deemed other than temporary is charged to earnings, resulting in the establishment of a new cost basis for the security. Loans Loans are stated at unpaid principal balances, reduced by unearned fees. Interest on loans is accrued and credited to income as it is earned using the simple interest method on daily balances of the principal amount outstanding. However, interest is generally not accrued on loans over 90 days contractually delinquent. Accrued interest income is reversed when a loan is placed on non-accrual status. Fees received on loans in excess of amounts representing the estimated cost of origination are deferred and credited to income using the interest method. 57    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Mortgage Banking Loans held for sale in the secondary market are carried at the lower of aggregate cost or fair value. Unrealized losses are recognized via a charge against operations through the establishment of a valuation reserve. Realized gains and losses on such loans are accounted for under the specific identification method. Loan origination fees and costs are not amortized during the period the loans are held for sale and are recorded as part of the gain or loss on the sale of loans. Certain mortgage loans are sold to permanent investors while we retain the right to service the loans. Service fees are recorded in income when earned. Capitalized servicing rights are recorded at the time the loan is sold, thereby increasing the gain on sale by such amount, and subsequently amortized over the period of the estimated future net servicing income of the underlying financial assets. Any remaining unamortized amount is charged to expense if the related loan is repaid prior to maturity. Management monitors the capitalized mortgage servicing rights for impairment based on the fair value of those rights, as determined on a quarterly basis. Any impairment is recognized through a valuation allowance. Allowances for Loan Losses We account for impaired loans in accordance with Statement of Financial Accounting Standards (SFAS) No. 114, Accounting By Creditors For Impairment Of A Loan, as amended by SFAS No. 118, Accounting By Creditors For Impairment Of A Loan—Income Recognition And Disclosures. SFAS No. 114 generally requires all creditors to account for impaired loans, except those loans that are accounted for at fair value or at the lower of cost or fair value, at the present value of the expected future cash flows discounted at the loan’s effective interest rate at the date of initial impairment, or, as a practical expedient, at the loan’s observable market prices or fair value of the collateral if the loan is collateral dependent. SFAS No. 114 indicates that a creditor should evaluate the collectibility of both contractual interest and contractual principal when assessing the need for a loss accrual. We consider a loan to be impaired when it is deemed probable by management that we will be unable to collect all contractual principal and interest payments in accordance with the terms of the original loan agreement. However, when determining whether a loan is impaired, management also considers the loan documentation, the current ratio of the loan’s balance to collateral value, and the borrower’s present financial position. Included as impaired loans are all loans contractually delinquent 90 days or more and all loans upon which accrual of interest has been suspended. Management believes that the allowance for loan losses as of December 31, 2005 is adequate. However, additions to or recaptures from the allowances may be necessary based upon changes in economic conditions, borrower financial status, the regulatory environment, real estate values, and loan portfolio size and composition. As such, periodic provisions for estimated loan losses may vary from time to time. Real Estate Owned Real estate acquired through foreclosure is initially recorded at the lower of cost or fair value less estimated cost to sell. If fair value less cost to sell is less than amortized cost, a charge against the allowance for loan losses is recorded at property acquisition. Declines in property value subsequent to acquisition are charged to operations. 58    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Recognition of gains on the sale of real estate is dependent upon the transaction meeting certain criteria relating to the nature of the property and the terms of the sale and potential financing. These criteria are presented within SFAS No. 66 Accounting For Sales Of Real Estate, and Accounting Principal Board No. 21, Interest On Receivables and Payables. Under certain circumstances, a gain on sale of real estate, or a portion thereof, may be deferred until the criteria are met. Losses on disposition of real estate, including expenses incurred in connection with the disposition, are charged to operations. Premises and Equipment Land is carried at cost. Other premises and equipment are reported at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the estimate useful lives of the assets or the term of the related lease, whichever is shorter. The useful lives for the principal classes of assets are:     Assets               Useful life         Buildings and   improvements       5 to 40 years         Furniture, fixtures, and   equipment       3 to 10 years           Goodwill and Other Intangible Assets Goodwill resulting from the acquisition of bank branches and subsidiaries represents the excess of the purchase price over the fair value of the net assets acquired or net liabilities assumed. Goodwill and intangible assets with indefinite useful lives are tested for impairment at least annually. Intangible assets with estimated useful lives are amortized to their estimated residual values and reviewed for impairment. Core deposit intangible assets resulting from the acquisition of bank branches and subsidiaries represent the fair value assigned to core deposits assumed. Core deposit intangible assets are amortized using the straight-line method over periods ranging from seven to fifteen years. The intangible asset resulting from the acquisition of an insurance agency represents the fair value assigned to the existing customer list of the insurance agency acquired. The agency expiration intangible asset was amortized using a straight-line basis over a period of ten years. In February 2005, the insurance agency subsidiary was sold to an independent third party. Therefore, the agency expiration intangible asset is presented in assets of discontinued operations in the 2004 consolidated financial statements. Bank Owned Life Insurance Bank owned life insurance is recorded at the cash surrender value of the underlying policies. Income on the investments in the policies, net of insurance costs, is recorded as non-interest income. Insurance Agency Commissions Insurance agency commissions are recorded as of the effective date of insurance coverage or the billing date, whichever is later. Contingent commissions and commissions on premiums billed and collected directly by insurance companies are recorded as revenue when received, which is our first notification of amounts earned. Insurance agency commissions are included in net income (loss) from discontinued operations in the 2004 and 2003 consolidated financial statements. 59    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Income Taxes We file consolidated federal income tax returns. Certain income and expense items are treated differently for financial reporting purposes than for income tax purposes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated 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 be recovered or settled. 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. Stock Incentive Plan The Company has applied the provisions of Accounting Principals Board (APB) Opinion No. 25 and related interpretations in accounting for options issued under the Stock Incentive Plan. The exercise price of certain of the stock options granted equals the market price of the underlying stock options on the date of grant, and therefore, no compensation expense is recorded. Certain other stock options granted have contingent vesting schedules based on various performance goals and therefore expense may be recorded as the difference between the exercise price and the fair market value at the date of vesting. We have adopted the disclosure-only provisions of Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (SFAS 123), included in footnote 13 of the notes to the consolidated financial statements. Income per Share Basic income per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the year. Diluted income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The shares used in the calculation of basic and diluted income per share are shown below:             Years   ended                 2005       2004       2003         Basic weighted   average common shares outstanding       4,038,097       4,060,587       4,095,903         Stock options       56,696       34,127       35,478         Diluted weighted average   common shares outstanding       4,094,793       4,094,714       4,131,381           Recent Accounting Developments In December 2004, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 123 (revised 2004), Share Based Payments, (SFAS 123R). This statement requires that the cost resulting from all share-based transactions be recognized in the financial statements. SFAS 123R establishes fair value as the measurement objective in accounting for share-based arrangements and requires all entities to apply a fair-value based measurement method in accounting for share based payments with employees except for equity instruments held by employee share ownership plans. SFAS 123R replaces FASB Statement No. 123, Accounting for Stock-Based Compensation, and  60    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 supercedes Accounting Principal Board Opinion No. 25, Accounting for Stock Issued to Employee, (APB 25) and is effective as of the beginning of the first interim or annual reporting period beginning after June 15, 2005. As discussed in the notes to consolidated financial statements, in 2005 and previous years, we have applied APB 25 in accounting for our stock incentive plans which requires compensation cost be recognized as the excess, if any, of the fair market value of our stock at the date of grant over the amount the employee must pay to acquire the stock. In accordance with APB 25 we have reported the pro forma effect on net income in the notes to the consolidated financial statements as if the share-based awards were accounted for using the fair value method in a footnote. On September 30, 2004 the FASB issued a final FASB Staff Position, FSP EITF Issue 03-1-1, that delays the effective date for the measurement and recognition guidance included in EITF Issue 03-1, The Meaning of Other-than-temporary Impairment and Its Application to Certain Investments, (EITF 03-1). Originally, this statement was effective for reporting periods beginning after June 15, 2004 and provided guidance on when to record a loss in the statement of operations and when additional information needed to be disclosed on unrealized losses. Other components of EITF 03-1 regarding quantitative and qualitative information was required to be presented in the financial statements effective for fiscal years ending after December 15, 2003 and was not deferred by the FASB’s Staff Position. This portion of EITF 03-1 was adopted in December 2003 and the required disclosures are included in footnote 3 in the Notes to Consolidated Financial Statements. The adoption of the measurement and recognition guidance, have not had a material impact on the financial position and results of operations. In December 2003, the American Institute of Certified Public Accountants issued Statement of Position 03-3, Accounting for Certain Loans or Debt Securities Acquired in a Transfer, (SOP 03-3). SOP 03-3 addresses the accounting for certain acquired loans or debt securities, including those acquired in a purchase business combination, that have experienced a deterioration of credit quality between the loan origination date that the date the loan is acquired by an investor, and for which it is probable that at acquisition the investor will be unable to collect all contractually required payments on the loan. Loans within the scope of this SOP that are acquired should be recognized initially at the present value of amounts expected to be received and no allowance for loan losses should be carried over related to these loans at acquisition. SOP 03-3 prohibits displaying accretable yield and nonaccretable differences in the balance sheet. SOP 03-3 is effective for loans acquired in fiscal years beginning after December 15, 2004. We adopted SOP 03-3 on January 1, 2005. The adoption of SOP 03-3 did not have a material impact on the financial position or results of operations. (2)          Discontinued Operations On February 25, 2005, we completed the sale of our insurance agency subsidiary, Team Insurance Group, Inc. All of the issued and outstanding shares of the subsidiary were sold to an unaffiliated third party for total cash consideration of $6,836,000. Our investment in Team Insurance Group, Inc. at February 25, 2005 was approximately $7,000,000. A loss on the sale of the subsidiary of approximately $164,000 was recorded in the second quarter of 2005 upon finalization of the selling price and is presented, net of the tax effect of $56,000, in discontinued operations in the accompanying consolidated financial statements. The sale was effective December 31, 2004 and, therefore, the operations of the insurance subsidiary during 2005 were assumed by the new owners. Pursuant to the terms of the agreement, the buyer has until August 25, 2006 to present any breach of warranty or representation claims. 61    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 As a result of the sale, the operations related to the insurance agency subsidiary have been classified as discontinued operations in the consolidated financial statements and notes to the consolidated financial statements. The following table presents the net assets of Team Insurance Group, Inc. as of December 31, 2004.             2004                 (In thousands)         Cash           $   1,033             Investments           —             Premises and   equipment, net           571             Goodwill           5,514             Intangible   assets, net of accumulated amortization           1,039             Other assets           125             Accrued expenses   and other liabilities           (1,282   )         Total net assets           $   7,000               Summarized results of operations of the insurance agency for the years ended December 31, 2004 and 2003 are as follows:             2004       2003                 (In thousands)         Insurance agency   commissions       $   4,153       $   4,454         Other income       193       229         Total income       4,346       4,683         Salary and   employee benefits       3,092       2,864         Occupancy and   equipment       338       274         Professional fees       90       53         Marketing       126       161         Supplies       39       58         Intangible asset   amortization       170       175         Goodwill   impairment       174       —         Intangible asset   write-off       119       —         Other       455       498         Total expenses       4,603       4,083         Net income (loss) from discontinued operations   before income taxes       (257   )   600         Income tax expense (benefit)       (39   )   250         Net income (loss)   from discontinued operations, net of tax       $   (218   )   $   350           62     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (3)          Investment Securities The amortized cost, gross unrealized gains and losses, and fair value of investment securities are presented below:             December 31, 2005                 Amortized   Cost       Gross   Unrealized   Gains       Gross   Unrealized   Losses       Fair value                 (In thousands)         Available for sale:                                                         Debt securities:                                                         U.S. Agency securities       $   61,062           $   32               $   (1,108   )       $   59,986         Mortgage-backed securities       86,535           404               (1,517   )       85,422         Nontaxable municipal securities       28,629           400               (168   )       28,861         Taxable municipal securities       830           42               —           872         Other debt securities       6,555           40               (152   )       6,443         Total debt securities       183,611           918               (2,945   )       181,584         Equity securities       8,777           52               (4   )       8,825         Total available for sale securities       $   192,388           $   970               $   (2,949   )       $   190,409                       December 31, 2004                 Amortized   Cost       Gross   Unrealized   Gains       Gross   Unrealized   Losses       Fair value                 (In thousands)         Available for sale:                                                         Debt securities:                                                         U.S. Agency securities       $   56,401           $   270               $   (472   )       $   56,199         Mortgage-backed securities       88,039           1,062               (435   )       88,666         Nontaxable municipal securities       30,442           863               (73   )       31,232         Taxable municipal securities       971           73               —           1,044         Other debt securities       6,057           139               —           6,196         Total debt securities       181,910           2,407               (980   )       183,337         Equity securities       8,459           53               (7   )       8,505         Total available   for sale securities       $   190,369           $   2,460               $   (987   )       $   191,842           Equity securities held at cost consist primarily of $6.8 million of Federal Home Loan Bank of Topeka common stock and $1.5 million of Federal Reserve Bank common stock. 63    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Gross realized gains and losses on sale of investment securities available for sale are summarized as follows:             Year ended December 31                 2005       2004       2003                 (In thousands)         Gain on sales of   investment securities available for sale       $   25       $   12       $   300         Loss on sales of   investment securities available for sale       (26   )   (62   )   (6   )     Net gain (loss) on sales of investment securities available   for sale       $   (1   )   $   (50   )   $   294         Proceeds from the sale   of investment securities available for sale       $   1,014       $   8,593       $   5,686           Information on temporarily impaired securities at December 31, 2005 and 2004, segregated by those investments that have been in continuous unrealized loss position for less than 12 months and those investments that have been in continuous unrealized loss position for 12 months or longer, is summarized as follows:             December 31, 2005                 Less than 12 months       12 months or longer       Total                 Fair   Value       Unrealized   Losses       Fair   Value       Unrealized   Losses       Fair   Value       Unrealized   Losses                 (In thousands)         Description of securities                                                                                 Debt securities:                                                                                 U. S. Agency securities       $   23,615           $   (344   )       $   30,052           $   (764   )       $   53,667           $   (1,108   )         Mortgage-backed securities       45,512           (838   )       21,002           (679   )       66,514           (1,517   )         Nontaxable municipal securities       8,355           (130   )       1,158           (38   )       9,513           (168   )         Other debt securities       2,853           (152   )       —           —           2,853           (152   )         Total debt securities       80,335           (1,464   )       52,212           (1,481   )       132,547           (2,945   )         Equity securities       7           (3   )       6           (1   )       13           (4   )         Total temporarily   impaired securities       $   80,342           $   (1,467   )       $   52,218           $   (1,482   )       $   132,560           $   (2,949   )                       December 31, 2004                 Less than 12 months       12 months or longer       Total                 Fair   Value       Unrealized   Losses       Fair   Value       Unrealized   Losses       Fair   Value       Unrealized   Losses                 (In thousands)         Description of securities                                                                                 Debt securities:                                                                                 U. S. Agency securities       $   28,312           $   (305   )       $   6,133           $   (167   )       $   34,445           $   (472   )         Mortgage-backed securities       35,978           (362   )       4,257           (73   )       40,235           (435   )         Nontaxable municipal securities       3,083           (35   )       1,507           (38   )       4,590           (73   )         Total debt securities       67,373           (702   )       11,897           (278   )       79,270           (980   )         Equity securities       4           —           10           (7   )       14           (7   )         Total temporarily   impaired securities       $   67,377           $   (702   )       $   11,907           $   (285   )       $   79,284           $   (987   )           The table above represents 218 investment securities at December 31, 2005 where the current fair value is less than the related amortized cost. The unrealized losses on these temporarily impaired securities are a result of changes in interest rates for fixed-rate securities where the interest rate received is less than the  64    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 current rate available for new offerings of similar securities, changes in market spreads as a result of shifts in supply and demand, and changes in the level of prepayments for mortgage-backed securities. These unrealized losses are considered temporary based on our ability and intent to hold until values recover. Contractual maturities of investment securities classified as available-for-sale are set forth in the following table. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without penalties.             December 31, 2005       December 31, 2004                 Amortized   Cost       Fair    Value       Amortized   Cost       Fair    Value                 (In thousands)       (In thousands)         Available-for-sale:                                         Due less than one year       $   12,159       $   12,064       $   4,861       $   4,901         Due after one through five years       27,288       26,838       36,192       36,329         Due after five through ten years       39,598       39,309       29,547       30,195         Due after ten years       104,566       103,373       111,310       111,912         Equity investments       8,777       8,825       8,459       8,505                 $   192,388       $   190,409       $   190,369       $   191,842           At December 31, 2005, securities with amortized cost of approximately $163,126,000 and fair value of approximately $161,145,000 were pledged as collateral to creditors, collateral for repurchase agreements, collateral for public funds on deposits and for other purposes as required by law. At December 31, 2004 securities with amortized cost of approximately $161,723,000 and fair value of approximately $162,677,000 were pledged for the same purposes. 65    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (4)          Loans Major classifications of loans at December 31, 2005 and 2004 are as follows:             2005       2004                         Percent of               Percent of                 Total       Total Loans       Total       Total Loans                 (Dollars in thousands)         Loans receivable:                                                         Loans secured by   real estate:                                                         One to four family       $   86,880           20.7   %       87,633           23.1   %         Construction and land development       80,918           19.3           49,388           13.0             Nonfarm, nonresidential       136,318           32.4           122,007           32.2             Farmland       32,135           7.6           13,480           3.6             Multifamily       4,603           1.1           4,301           1.1             Commercial and industrial       55,128           13.1           67,970           18.0             Agricultural       7,952           1.9           14,919           3.9             Installment loans       11,843           2.8           13,691           3.6             Obligations of state and political subdivision       4,131           1.0           4,370           1.2             Lease financing receivables       1,202           0.3           1,802           0.5             Gross loans       421,110           100.2           379,561           100.2             Less unearned fees       929           0.2           790           0.2             Total loans receivable       $   420,181           100.0   %       378,771           100.0   %           66     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Included in one-to-four family real estate loans are mortgage loans held for sale of approximately $1,845,000 and $3,107,000 at December 31, 2005 and 2004, respectively. A summary of non-performing assets is as follows:             December 31                 2005       2004                 (In thousands)         Non-performing assets:                         Non-accrual   loans:                         Real estate loans       $   1,303       $   710         Commercial, industrial, and agricultural       906       308         Installment loans       134       263         Total non-accrual loans       2,343       1,281         Loans past due 90 days   or more still accruing:                         Real estate loans       604       40         Commercial, industrial, and agricultural       534       344         Installment loans       46       36         Total past due 90 days or more still accruing       1,184       420         Restructured loans       1,055       1,053         Total non-performing loans       4,582       2,754         Assets acquired through foreclosure       455       408         Total   non-performing assets       $   5,037       $   3,162           An analysis of impaired loans is summarized as follows:            Accrual status       Non-accrual status       Total impaired loans                         Specific               Specific               Specific                 Principal       Allowances       Principal       Allowances       Principal       Allowances                 (In thousands)         December 31,   2005           $   1,184               $   —               $   2,343               $   613               $   3,527               $   613             December 31, 2004           $   420               $   —               $   1,281               $   262               $   1,701               $   262               Average investment in impaired loans was $2,331,000, $4,008,000 and $6,683,000 during the years ended December 31, 2005, 2004 and 2003 respectively. Activity related to loans made to our directors and executive officers during 2005 is presented below. Such loans were made in the ordinary course of business on normal credit terms, including interest rate and collateralization (in thousands):     Loans to   executive officers and directors at January 1, 2005       $   1,263         Additions       618         Amounts collected       (371   )     Balance at   December 31, 2005       $   1,510           Our primary market areas in Kansas are Miami County, Allen County, Franklin County, Labette County, Johnson County and surrounding counties. The primary market areas in Nebraska are Washington  67    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 County, and Sarpy County. The primary market areas in Colorado are El Paso County and Teller County along the front range of the Colorado Rocky Mountains and in Missouri the primary market areas are Vernon County and Barton County. The majority of the loans made by our subsidiary banks are within these primary market areas. (5)          Mortgage Banking Activities We service first mortgage loans for secondary investors. Escrow balances are held on deposit for first mortgage loans serviced in our subsidiary banks. The aggregate first mortgage loans serviced and escrow balances held are as follows:             December 31                 2005       2004                 (In thousands)         Mortgage loans   serviced       $   88,959       $   106,371         Escrow deposits       501       522                     Included in gain on sales of mortgage loans are capitalized mortgage servicing rights. A summary of the net mortgage servicing rights, which are included in intangible assets for the years ended December 31, 2005, 2004, and 2003 is as follows:             2005       2004       2003                 (In thousands)         Balance   January 1       $   514       $   656       $   637         Mortgage   servicing rights capitalized during the year       29       80       288         Amortization       (140   )   (222   )   (510   )     Valuation   adjustment       —       —       241         Balance December 31       $   403       $   514       $   656           Service fees earned, included in other income, were approximately $248,000, $290,000, and $329,000 for the years ended December 31, 2005, 2004 and 2003, respectively. (6)          Allowance for Loan Losses A summary of the allowances for loan losses for the years ended December 31, 2005, 2004, and 2003 is as follows:             December 31                 2005       2004       2003                 (In thousands)         Balance,   beginning of year       $   4,898       $   4,506       $   4,611         Provision for   loan losses       820       1,465       1,790         Charge-offs       (711   )   (1,306   )   (2,247   )     Recoveries       417       233       352         Balance, end of year       $   5,424       $   4,898       $   4,506           68     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (7)   Premises and Equipment, Net Major classifications of bank premises and equipment at December 31, 2005 and 2004 for continuing operations are summarized as follows:             December 31                 2005       2004                 (In thousands)         Land       $   4,666       $   3,020         Bank premises       13,582       12,450         Furniture,   fixtures, and equipment       11,012       11,591                 29,260       27,061         Less accumulated   depreciation       12,901       11,744                 $16,359       $   15,317                     Depreciation expense from continuing operations aggregating $1,231,000, $1,194,000, and $1,083,000 for the years ended December 31, 2005, 2004, and 2003, respectively, is included in occupancy and equipment expense in the accompanying consolidated statements of operations. Space in certain facilities is rented under operating leases extending to 2007. Rent expense for continuing operations related to the leases was approximately $108,000 during 2005 and $107,000 during 2004 and 2003. Following is a summary of future minimum lease payments for years following December 31, 2005:             (In thousands)         2006           $   108,000             2007           85,000             Thereafter           —                         $193,000               (8)   Goodwill and Intangible Assets The following table presents the original cost and accumulated amortization of intangible assets for continuing operations.             December 31                 2005       2004                 Gross Carrying       Accumulated       Gross Carrying       Accumulated                 Amount       Amortization       Amount       Amortization                 (In thousands)       (In thousands)         Core deposit   intangible           $   6,400               $   3,581               $   6,400               $   3,103             Noncompete   agreements           —               —               150               150             Mortgage   servicing rights           2,450               2,046               2,420               1,906             Total intangible assets           $   8,850               $   5,627               $   8,970               $   5,159               69    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Expected amortization expense is as follows:             Estimated amortization expense                 Core Deposit       Mortgage                         Intangible       Servicing Rights       Total                 (In thousands)         Year ending   December 31,                                                 2006           $   475               $   69           $   544         2007           475               69           544         2008           391               69           460         2009           383               69           452         2010           383               69           452                            Goodwill was $10,700,000 at December 31, 2005 and December 31, 2004. There was no impairment of goodwill associated with continuing operations recorded for the years ended December 31, 2005, 2004 and 2003. See additional information in footnote 2, Discontinued Operations, for goodwill associated with discontinued operations in 2004. (9)   Deposit Accounts Deposits are summarized as follows:             December 31                 2005       2004                 (In thousands)         Demand:                         Noninterest bearing       $   76,011       $   71,598         Interest bearing:                         NOW       110,780       112,052         Money market       46,465       49,931                 157,245       161,983         Total demand       233,256       233,581         Savings       31,944       32,749         Time       242,678       201,620         Total deposits       $   507,878       $   467,950         Time deposits of   $100,000 and over       $   74,426       $   52,785           70    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Principal maturities of time deposits at December 31, 2005 are as follows:             Amount                 (In thousands)         Year:                         2006           $   173,910             2007           48,314             2008           14,688             2009           4,331             2010           1,419             Thereafter           16                         $   242,678               71     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (10)                        Securities Sold under Agreements to Repurchase Our obligation to repurchase securities sold at December 31, 2005 and 2004 aggregated approximately $4,036,000 and $5,669,000, respectively. Information concerning securities sold under agreements to repurchase is as follows:             December 31                 2005       2004                 (Dollars in thousands)         Average monthly   balance during the year       $   5,347       $   10,481         Average interest   rate during the year       2.54   %   1.36   %     Maximum month-end   balance during the year       $   12,936       $   22,416           At December 31, 2005 and 2004, such agreements were secured by investment securities. (11)                        Advances from the Federal Home Loan Bank, Notes Payable and Other Borrowings Following is a summary of the advances from the Federal Home Loan Bank, notes payable and other borrowings at December 31:             2005       2004                 (In thousands)         Borrowing under a   line of credit, interest floating at 2.00%   over one month LIBOR (5.51% and 4.28% at December 31,   2005 and 2004); due June 30, 2006; secured by common   stock of subsidiary banks; maximum credit limit as of   December 31, 2005 was $6,000,000       $   —       $   3,400         Other borrowings       202       144                 202       3,544         Federal Home Loan   Bank borrowings   at interest rates ranging from 2.62% to 6.96%;   maturities ranging from 2006 to 2019; secured by real   estate loans, investments securities, and Federal Home   Loan Bank stock       111,131       111,915                 $   111,535       $   119,003           As of December 31, 2005, we did not have an outstanding balance on the $6,000,000 line of credit. Interest of .1875% is payable on the unused line of credit amounts. Our subsidiary banks maintain lines of credit with the Federal Home Loan Bank of Topeka approximating $167,603,000. As of December 31, 2005, our subsidiary banks had $111,131,000 outstanding on the lines of credit and $41,400,000 of outstanding letters of credit, leaving available borrowings of approximately $15,072,000. The Federal Home Loan Bank borrowings at December 31, 2005 consisted of $4,131,000 in fixed rate advances with interest ranging from 2.62%-6.96%, maturing in 2006 through 2019, $22,000,000 in variable rate advances with interest ranging from 3.52% to 5.87%, maturing in 2010 through 2015 and $85,000,000  72    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 in fixed rate advances convertible to floating rate if LIBOR increases to a range of 6.0% to 7.50%, interest ranging from 3.66% to 4.21%, maturing in 2007 through 2012. Principal maturities on advances from the Federal Home Loan Bank, and long-term notes payable at December 31, 2005 were as follows:             Amount                 (In thousands)         Year:                         2006           $   3,202             2007           10,000             2008           —             2009           5,000             2010           5,000             Thereafter           88,131                         $   111,333               (12)                        Subordinated Debentures On August 10, 2001, Team Financial Capital Trust I (the Trust), a Delaware business trust formed by Team Financial, Inc., completed the sale of $15.5 million 9.50% Cumulative Trust Preferred Securities. The Trust used the net proceeds from the offering to purchase a like amount of Team Financial, Inc.’s 9.50% subordinated debentures. The debentures, maturing August 10, 2031, are the sole assets of the Trust. In exchange for the capital contribution made to the Trust by Team Financial, Inc. upon formation, Team Financial, Inc. owns all of the common securities of the Trust. In accordance with Financial Accounting Standards Board Interpretation No. 46R, Consolidation of Variable Interest Entities (FIN 46 R), adopted in December 2003, the Trust qualifies as a special purpose entity that is not required to be consolidated in the financial statements of Team Financial, Inc. The $15.5 million Trust Preferred Securities issued by the Trust will remain on the records of the Trust. We continue to include the Trust Preferred Securities issued by the Trust in Tier I capital for regulatory capital purposes. Total expenses associated with offering the preferred securities of the Trust, paid by Team Financial, Inc., approximated $1.0 million and are reflected in Team Financial Inc.’s financial statements. The costs are included in “Other Assets” and are being amortized on a straight-line basis to interest expense over the life of the debentures. As of December 31, 2005, approximately $846,000 of the cost related to offering the Trust Preferred Securities remained unamortized. The Trust Preferred Securities accrue and pay distributions quarterly at annual rates of 9.50% of the stated liquidation amount of $10 per preferred security. We have fully and unconditionally guaranteed all of the obligations of the Trust. The guaranty covers the quarterly distributions and payments on liquidation or redemption of the Trust Preferred Securities. The Trust Preferred Securities are mandatorily redeemable upon the maturity of the debentures on August 10, 2031 or upon earlier redemption as provided in the Indentures. We have the right to redeem the debentures, in whole or in part, on or after August 10, 2006 at a redemption price specified in the  73    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Indentures plus any accrued but unpaid interest to the redemption date. In the event that we would redeem all or part of the debentures on or after August 10, 2006, we would amortize the proportionate unamortized cost of the offering and incur a charge. The maximum charge that would be incurred should we redeem all of the subordinated debentures on August 10, 2006 would be approximately $826,000. (13) Employee Benefit Plans Eligible employees participate in an employee stock ownership plan (ESOP). ESOP contributions charged to salaries and benefits expense were approximately $250,000 in 2005, $365,000 in 2004, and $441,400 in 2003. The 2005 contribution consisted of cash only. The 2004 contribution consisted of 30,500 shares of common stock with a fair value of $11.95 per share. The 2003 contribution consisted of 33,000 shares of common stock with a fair value of $12.50 per share and 2,300 shares with fair value of $12.55. Employees have the opportunity to purchase our common stock pursuant to Section 423 of the Internal Revenue Code through the ESOP. The price per share of the common stock under the ESOP is 85% of the fair market value of the stock at the commencement of each offering period. We issued 2,717 shares in January 2005 in exchange for cash of $30,485. We issued 7,915 and 4,678 shares in January 2004 and 2003, respectively, in exchange for cash of approximately $67,000 and $33,000. Under various performance incentive programs, employees may be granted awards for their performance based on certain financial and growth targets determined by management. Bonus awards for the Chief Executive Officer and Chief Financial Officer are at the discretion of the Compensation Committee of the Board of Directors, and bonus awards for all other employees are at the discretion of executive management. Bonus awards consist of cash, common stock, or a combination thereof. We charged approximately $643,900, $74,800 and $46,500 to salaries and employee benefits expense as a result of this bonus program in 2005, 2004, and 2003, respectively. Employees meeting certain conditions are eligible to participate in the Team Financial, Inc. 401(k) Savings Plan immediately upon their employment date. Upon meeting certain conditions, the Company matches 50% of the first 6% of deferred compensation that employees contribute to the Plan. Team Financial, Inc.’s contributions vest ratably over five years. We recorded $164,000, $186,400 and $210,000, to salaries and employee benefits expense as a result of this program in 2005, 2004, and 2003, respectively. Employees meeting certain conditions are eligible to participate in the Stock Incentive Plan (the Plan). The selection of participants is solely within the discretion of the board of directors. The stock incentive awards authorized to be distributed under the Plan on a stand alone, combination, or tandem basis are (i) stock options, (ii) stock appreciation rights, (iii) other stock based awards. Pursuant to the Plan, 470,000 shares of Team Financial, Inc. common stock are reserved for issuance under the stock option components of the Plan. We charged approximately $91,000, $15,000 and $125,600 to compensation expense during 2005, 2004 and 2003, respectively, in connection with stock options to acquire shares of common stock granted at exercise prices below market value. 74    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 The following table presents option activity for the years ended December 31, 2005, 2004 and 2003:                     Weighted Average                 Number       Exercise Price         Options outstanding at December 31, 2002       228,300           $   8.25             Options awarded       49,750           10.79             Options exercised       (2,750   )       7.86             Options outstanding at   December 31, 2003       275,300           8.71             Options awarded       39,750           12.33             Options exercised       (39,200   )       8.33             Options forfeited       (21,300   )       8.80             Options outstanding at   December 31, 2004       254,550           9.33             Options awarded       54,500           13.33             Options exercised       (4,200   )       7.03             Options outstanding at   December 31, 2005       304,850           $   10.08             Options vested at   December 31, 2005       250,250           $   9.36               The following table summarizes information about the plan’s stock options at December 31, 2005:     Options Outstanding       Options Vested                         Weighted Average       Weighted               Weighted         Range of Exercise       Number       Remaining       Average       Number       Average         Price       Outstanding       Contractual Life (years)       Exercise Price       Vested       Exercise Price         $    6.50 - 6.75           47,050               5.01               $   6.625           47,050           $   6.625             8.25 - 8.50           34,850               6.01               8.320           34,850           8.320             8.75 - 9.00           70,000               4.00               8.940           70,000           8.940             10.00 - 10.25           43,950               7.01               10.100           43,950           10.100             12.00 - 12.25           39,750               9.01               12.194           23,050           12.194             12.25 - 12.50           39,750               8.01               12.410           31,350           12.410             14.25 - 14.50           29,500               10.00               14.300           0           0.000             $ 6.50 - 14.50           304,850               6.58               $   10.075           250,250           $   9.357               75    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 The Company has applied the provisions of Accounting Principals Board (APB) Opinion No. 25 and related interpretations in accounting for options issued under the Stock Incentive Plan. Under APB No. 25, compensation cost for stock options is measured as the excess, if any, of the fair market value of our stock at the date of grant over the amount the employee must pay to acquire the stock. Had compensation costs for the stock option components of the Plan been determined based upon the fair value at the date of grant consistent with SFAS No. 123, Accounting For Stock Based Compensation, our net income and earnings per share would have been reported as the pro forma amounts indicated below:             2005       2004       2003                 (Dollars in thousands, except per share data)         Net income:                                 As reported       $   3,970       $   3,578       $   3,792         Stock-based compensation   expense included   in reported net income, net of tax       60       10       83         Compensation expense   determined under fair value, net of tax       (143   )   (98   )   (188   )     Pro forma       $   3,887       $   3,490       $   3,687         Basic earnings per share:                                 As reported       $   0.98       $   0.88       $   0.93         Pro forma       0.96       $   0.86       0.90         Diluted earnings per share:                                 As reported       $   0.97       $   0.87       $   0.92         Pro forma       0.95       0.85       0.89         Shares applicable to   basic earnings per share       4,038,097       4,060,587       4,095,903         Shares applicable to   diluted earnings per share       4,094,793       4,094,714       4,131,381           For purposes of the table above, the fair value of options granted was estimated at the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions; risk free interest rate of 4.39% for 2005, 4.23% for 2004, and 4.26% for 2003; an expected life of 10 years; expected volatility of stock price of 17.13% for 2005, 16.14% for 2004, and 15.93% for 2003; and expected dividends of 2.19% per year for 2005, 2.69% for 2004, and 2.45% for 2003. The weighted average of the estimated fair value of the options granted in 2005, 2004 and 2003 was $2.60, $2.60 and $2.70, respectively. As described in note 1, the Company will adopt the provisions of SFAS 123R Share Based Payment in 2006 which requires that the cost resulting from all share-based transactions be recognized in the consolidated financial statements. In July 2001, our board of directors approved a nonqualified salary continuation plan for executive officers and certain other officers whereby the officer will receive monthly benefits for ten years commencing with the month after retirement or termination due to disability. The monthly benefits accrue based upon a stated percentage ranging from 25% to 65% of the average of the highest of the participant’s salary for any three years in the ten year period immediately preceding termination of employment on or after the normal retirement date. In the event of death of certain participants, the plan provides a continuing benefit to the spouse based on a vesting schedule defined by a percentage of the participant’s age. The subsidiary banks charged $306,800, $285,500 and $246,600 to salary and employee benefits expense for 2005, 2004 and 2003, respectively, as a result of this program. In connection with the plan, we have recorded a liability of $1,144,400 and $837,700 at December 31, 2005 and 2004, respectively. 76     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 In January of 2002, our board of directors approved a nonqualified deferred compensation plan for executive officers and certain other bank officers whereby the officer may defer a stated percentage of salary ranging from 2% of compensation to 10% of compensation. The deferral amounts are matched by the Company based on a stated percentage ranging from 15% to 25%. We accrue interest on the deferred amounts based on a modified return on equity calculation, which includes the return on equity of our subsidiary bank, TeamBank, N.A, net of core deposit intangible asset amortization. We charged $40,600 during 2005, $31,200 during 2004 and $22,600 during 2003 to salary and employee benefits expense as a result of this program. A liability of $382,900 and $285,000 was recorded at December 31, 2005 and 2004, respectively, associated with this plan. (14)   Income Taxes Total income tax expense for 2005, 2004, and 2003 was allocated as follows:             2005       2004       2003                 (In thousands)         Income from   continuing operations       $   944       $   222       $   958         Income (loss)   from discontinued operations       (56   )   (39   )   250         Other   comprehensive income       (1,174   )   (477   )   (1,070   )     Stockholders’   equity, recognition to tax benefit for stock options       (38   )   —       —         Total       $   (324   )   $   (294   )   $   138           Income tax expense (benefit) attributable to income from continuing operations for 2005, 2004, and 2003 consists of the following:             2005       2004       2003                 (In thousands)         Current                                 Federal       $   1,240       $   335       $   1,129         State       186       273       162         Deferred                                 Federal       (428   )   (339   )   (372   )     State       (54   )   (47   )   39         Total       $   944       $   222       $   958           77    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Following is a reconciliation between income tax expense attributable to income from continuing operations and the amount computed by multiplying earnings before income taxes by the statutory federal income tax rate of 34%:             2005       2004       2003                 (In thousands)         Expected federal   income tax expense       $   1,707       $   1,366       $   1,496         Interest on obligations   of state and political                                 subdivisions       (500   )   (516   )   (508   )     State income taxes, net   of federal tax                                 benefit       24       125       138         Cash value increase of   bank owned life                                 insurance, net of   premiums paid       (245   )   (242   )   (271   )     Income tax benefit on   dividends paid to                                 ESOP       (105   )   (109   )   (87   )     Reduction of   estimated income tax accrual       (25   )   (453   )   —         Other       88       51       190         Income tax   expense attributable to income from continuing operations       $   944       $   222       $   958           78    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 The income tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities of continuing operations at December 31, 2005 and 2004 are presented below:             2005       2004                 (In thousands)         Deferred tax assets:                         Allowance for loan losses       $   1,844       $   1,665         Net unrealized loss on securities available for sale       673       —         State net operating losses       735       635         Deferred compensation       572       437         Self insurance accrual       108       148         Other       41       113         State taxes, net       78       42         Deferred tax assets from continuing operations       4,051       3,040         Deferred tax assets of discontinued operations       —       171         Total gross deferred tax assets       4,051       3,211         Less valuation allowance       (735   )   (635   )     Total net deferred tax assets       3,316       2,576         Deferred liabilities:                         Dividends from real estate investment trust       —       202         Net unrealized gain on securities available for sale       —       501         Mortgage servicing rights       137       175         Premises and equipment       937       1,029         Core deposit intangible asset       65       97         FHLB stock       367       259         Carrying value of bonds due to acquisition       9       23         Other       39       13         Deferred tax liabilities from continuing operations       1,554       2,299         Deferred tax liabilities of discontinued operations       —       535         Total gross deferred tax liabilities       1,554       2,834         Net deferred tax (liability) asset       $   1,762       $   (258   )       The Company carries a valuation allowance to reduce certain state net operating loss carryforwards which expire at various times through 2025. At December 31, 2005, management believes it is more likely than not that these items will not be realized. We had deferred income for tax purposes related to our investment in a Real Estate Investment Trust because of a different tax year for a subsidiary entity. As a result of a new regulation promulgated by the Treasury Department in 2002, income of $606,000 has been included in taxable income ratably over a four-year period beginning in 2002. As a result of this change in tax law, deferred income taxes payable of $202,000 as of December 31, 2004 were paid during 2005. There was no remaining balance payable as of December 31, 2005. 79     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (15)   Fair Value of Financial Instruments Fair value of financial instruments at December 31, 2005 and 2004, including methods and assumptions utilized, are set forth below:             2005       2004                 Carrying       Estimated       Carrying       Estimated                 Amount       Fair Value       Amount       Fair Value                 (In thousands)       (In thousands)         Cash and cash   equivalents       $   34,000       $   34,000       $   35,000       $   35,000         Accrued interest   receivable       5,000       5,000       4,000       4,000         Investment   securities       190,000       190,000       192,000       192,000         Loans, net of   unearned discounts and allowance for loan losses        415,000       414,000       374,000       373,000         Bank owned life   insurance policies       19,173       19,173       18,460       18,460         Demand deposits       $   76,000       $   76,000       $   72,000       $   72,000         Money market and   NOW deposits       157,000       157,000       161,000       161,000         Savings deposits       32,000       32,000       33,000       33,000         Time deposits       243,000       243,000       202,000       202,000         Total deposits       $   508,000       $   505,000       $   468,000       $   466,000         Accrued interest   payable       $   2,000       $   2,000       $   1,000       $   1,000         Notes payable and   FHLB advances       111,000       108,000       115,000       114,000         Subordinated debentures       16,000       16,000       16,000       17,000           Methods and assumptions The estimated fair value of cash and cash equivalents has no stated maturity and is equal to the carrying value. The estimated fair value of accrued interest receivable has no stated maturity and is equal to the carrying value. The estimated fair value of investment securities is based on quoted market prices or bid quotations received from securities dealers. The estimated fair value of our loan portfolio is based on the segregation of loans by maturity using a weighted average pool rate. In estimating the fair value of loans, the carrying amount is reduced by the allowance for loan losses. The estimated fair value is calculated by discounting scheduled cash flow through the estimated maturity using estimated market discount rates based upon our current offering rates with similar maturities that reflect the interest rate risk inherent in the loans. The estimated fair value of bank owned life insurance policies is based on quoted net policy values from the insurance carrier and is equal to the carrying value. The estimated fair value of deposits with no stated maturity, such as non-interest bearing demand deposits, savings, NOW accounts, and money market accounts, is equal to the amount payable on demand. The fair value of interest bearing time deposits is based on the discounted value of contractual cash flows of such deposits. The discount rate is estimated using the rates currently offered for deposits of similar remaining maturities. 80    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 The estimated fair value of accrued interest payable has no stated maturity and is equal to the carrying value. The estimated fair value of fixed rate notes payable and Federal Home Loan Bank Advances is based on the discounted value of contractual maturities. The discount rate is estimated using the spread adjusted London Inter-Bank Offering Rate (LIBOR). The carrying value of all floating rate notes payable and Federal Home Loan Bank Advances approximates fair value, as all these notes are based upon floating market rates, which approximate market rates. The estimated fair value of our obligated mandatory redeemable preferred securities of subsidiary trust holding solely subordinated debentures is based on quoted market prices on the NASDAQ National Market. Limitations Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering for sale at one time our entire holdings of a particular financial instrument. Because no market exists for a significant portion of our financial instruments, fair value estimates are based on judgments regarding future loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. 81    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (16)   Capital Adequacy Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the table below for Team Financial Inc. and our subsidiary banks) of total risk-based and Tier 1 capital (as defined in the regulations) to risk-weighted assets, and of Tier 1 capital to average assets. Management believes, as of December 31, 2005 and 2004, that the banks and Team Financial Inc. met all applicable capital adequacy requirements.                                             To be well                                                 capitalized under                                 For capital       prompt corrective                 Actual       adequacy purposes       action provisions                 Amount       Ratio       Amount       Ratio       Amount       Ratio                 (Dollars in thousands)         At December 31,   2005:                                                                 Team   Financial, Inc.:                                                                 Risk-based capital (to risk weighted assets)       $   62,085       12.72   %   $   39,061           8.00   %                         Tier 1 capital (to risk weighted assets)       56,661       11.60   %   19,530           4.00   %                         Tier 1 capital (to average assets)       56,661       8.42   %   26,903           4.00   %                         TeamBank, N.A.:                                                                 Risk-based capital (to risk weighted assets)       $   50,987       12.18   %   $   33,483           8.00   %       $   41,853       10.00   %     Tier 1 capital (to risk weighted assets)       46,263       11.05   %   16,741           4.00   %       25,112       6.00   %     Tier 1 capital (to average assets)       46,263       8.16   %   22,668           4.00   %       20,927       5.00   %     Colorado National   Bank:                                                                 Risk-based capital (to risk weighted assets)       $   9,075       13.34   %   $   5,442           8.00   %       $   6,802       10.00   %     Tier 1 capital (to risk weighted assets)       8,375       12.31   %   2,721           4.00   %       4,081       6.00   %     Tier 1   capital (to average assets)       8,375       8.04   %   4,165           4.00   %       3,401       5.00   %       82    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003                                               To be well                                                 capitalized under                                 For capital       prompt corrective                 Actual       adequacy purposes       action provisions                 Amount       Ratio       Amount       Ratio       Amount       Ratio                 (Dollars in thousands)         At December 31,   2004                                                                 Team   Financial, Inc.:                                                                 Risk-based capital (to risk weighted assets)       $   51,755       11.81   %   $   35,049           8.00   %                         Tier 1 capital (to risk weighted assets)       46,857       10.70   %   17,524           4.00   %                         Tier 1 capital (to average assets)       46,857       7.43   %   25,213           4.00   %                         TeamBank, N.A.:                                                                 Risk-based capital (to risk weighted assets)       $   43,861       11.56   %   $   30,363           8.00   %       $   37,953       10.00   %     Tier 1 capital (to risk weighted assets)       39,540       10.42   %   15,181           4.00   %       22,772       6.00   %     Tier 1 capital (to average assets)       39,540       7.38   %   21,438           4.00   %       26,797       5.00   %     Colorado National   Bank:                                                                 Risk-based capital (to risk weighted assets)       $   8,756       15.39   %   $   4,553           8.00   %       $   5,691       10.00   %     Tier 1 capital (to risk weighted assets)       8,179       14.37   %   2,276           4.00   %       3,414       6.00   %     Tier 1   capital (to average assets)       8,179       8.83   %   3,704           4.00   %       4,630       5.00   %       (17)   Commitments, Contingencies and Off-Balance Sheet Risks Team Financial, Inc. has commitments to extend credit to our customers of approximately $81,310,000 at December 31, 2005. Additionally, the contractual amount of standby letters of credit at December 31, 2005 was approximately $6,202,000. These commitments involve credit risk in excess of the amount stated in the consolidated balance sheet. Exposure to credit loss in the event of nonperformance by the customer is represented by the contractual amount of those instruments. Standby letters of credit are a conditional, but irrevocable form of guarantee issued to guarantee payment to a third party obligee upon default of payment by our customer. Standby letters of credit are initially issued for a period of one year, but can be extended depending on the customers’ needs. As of December 31, 2005, the maximum remaining term for any standby letter of credit was 2008. Since the credit risk involved in issuing standby letters of credit is the same as that involved in extending loans to customers, Team Financial, Inc. uses the same credit policies in evaluating the creditworthiness of the customers and determining the required collateral. Pursuant to the terms of the agreement to sell our insurance agency subsidiary on February 25, 2005, the buyer has until August 25, 2006 to present any breach of warranty or representation claims. Although no formal warranty or representation claims have been presented, in the event that claims are presented, their ultimate outcome is not ascertainable at this time. See note 2 to the consolidated financial statements for additional information on the sale of this subsidiary. 83     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 During the third quarter of 2005, a summary judgment was entered against the Company and its subsidiaries by a Nebraska district court in pending litigation regarding a contract provision in the Company’s 1999 acquisition of Ft. Calhoun State Bank, now operated as part of TeamBank, N.A. Although this judgment is currently on appeal, it did result in a charge of $214,000 to other non-interest expense in the third quarter of 2005. We do not anticipate that any interest that may be accrued on this amount until the appeal is settled will be material to our financial position or operating results. The Company does not believe that any other pending litigation to which we are a party will have a material adverse effect on our liquidity, financial condition, or results of operations. (18)   Parent Company Condensed Financial Statements Condensed Statements of Financial Condition (In thousands)             December 31                 2005       2004         Assets                         Cash and cash   equivalents       $   1,451       $   1,805         Investment in   subsidiaries       66,818       69,208         Other       1,709       1,913         Total assets       $   69,978       $   72,926         Liabilities and Stockholders’   Equity                         Subordinated   debentures       $   16,005       $   16,005         Other liabilities   and notes payable       624       4,067         Stockholders’   equity       53,349       52,854         Total liabilities   and stockholders’ equity       $   69,978       $   72,926           Condensed Statements of Operations (In thousands)             Years ended December 31                 2005       2004       2003         Income:                                 Dividends from subsidiaries       $   5,730       $   4,261       $   4,800         Interest income       50       49       3         Loss on discontinued operations       —       (119   )   —         Other expense, net       (2,648   )   (2,124   )   (2,198   )     Income before equity in undistributed earnings of   subsidiaries       3,132       2,067       2,605         Increase   (decrease) in undistributed equity of subsidiaries       (109   )   667       358         Income before income tax benefit       3,023       2,734       2,963         Income tax   benefit       947       844       829         Net income       $   3,970       $   3,578       $   3,792           84    TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 Condensed Statements of Cash Flows (In thousands)             Year ended December 31                 2005       2004       2003         Cash flows from   operating activities:                                 Net income       $   3,970       $   3,578       $   3,792         (Increase) decrease in undistributed equity of   subsidiaries       109       (667   )   (358   )     Contribution of treasury stock to ESOP       —       365       441         Non-cash compensation expense       129       7       26         Other       207       (592   )   1,815         Net cash provided by operating activities       4,415       2,691       5,716         Cash flows from   investing activities:                                 Other       (16   )   —       —         Net cash used in investing activities       (16   )   —       —         Cash flows from   financing activities:                                 Proceeds from notes payable       600       2,877       200         Principal payments on notes payable       (4,027   )   (2,565   )   (3,540   )     Purchase of treasury stock       (64   )   (1,683   )   (564   )     Issuance of common stock       31       401       55         Dividends paid on common stock       (1,293   )   (1,298   )   (1,022   )     Net cash used in financing activities       (4,753   )   (2,268   )   (4,871   )     Net increase (decrease) in cash and cash equivalents       (354   )   423       845         Cash and cash   equivalents at beginning of the year       1,805       1,382       537         Cash and cash equivalents   at end of the year       $   1,451       $   1,805       $   1,382           The primary source of funds available to us is the payment of dividends by our subsidiaries. Subject to maintaining certain minimum regulatory capital requirements, regulations limit the amount of dividends that may be paid without prior approval of the subsidiaries’ regulatory agencies. At December 31, 2005, the subsidiaries could pay additional dividends of $1,200,000 without prior regulatory approval. 85     TEAM FINANCIAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (19)   Quarterly Results of Operations (Unaudited) The following is a summary of quarterly results:             First       Second       Third       Fourth                 quarter       quarter       quarter       quarter                 (Dollars in thousands, except per share data)         Year ended 2005:                                         Interest income       $   8,406       $   9,008       $   9,316       $   9,879         Interest expense       3,372       3,714       3,933       4,224         Provision for loan losses       145       267       263       145         Net income from continuing operations       996       967       881       1,234         Net income (loss) from discontinued operations       —       (108   )   —       —         Net income       996       859       881       1,234         Basic income per share from continuing operations       0.25       0.24       0.22       0.31         Diluted income per share from continuing operations       0.24       0.24       0.21       0.30         Basic income per share from discontinued operations       —       (0.03   )   —       —         Diluted income per share from discontinued   operations       —       (0.03   )   —       —         Basic income per share       0.25       0.21       0.22       0.31         Diluted income per share       $   0.24       $   0.21       $   0.21       $   0.30         Year ended 2004:                                         Interest income       $   7,806       $   7,953       $   7,896       $   8,321         Interest expense       3,130       3,083       3,121       3,257         Provision for loan losses       250       310       261       644         Net income from continuing operations       778       850       1,035       1,133         Net income (loss) from discontinued operations       50       (96   )   117       (289   )     Net income       828       754       1,152       844         Basic income per share from continuing operations       0.19       0.21       0.32       0.28         Diluted income per share from continuing operations       0.19       0.20       0.31       0.28         Basic income per share from discontinued operations       0.01       (0.02   )   (0.03   )   (0.07   )     Diluted income per share from discontinued   operations       0.01       (0.02   )   (0.03   )   (0.07   )     Basic income per share       0.20       0.18       0.29       0.21         Diluted income   per share       $   0.20       $   0.18       $   0.28       $   0.21           86
under the caption “Principal Accountant Fees and Services”, and is incorporated in this Report by reference. Item 15.                 Exhibits, Financial Statement Schedules       (a)   1.   Financial Statements             These documents are   listed in the Index to Consolidated Financial Statements under Item 8.         2.   Financial Statement   Schedules             All financial statement   schedules required by Article 9 of Regulation S-X have been included in   the Consolidated Financial Statements or are either not applicable or not   significant.         3.   Exhibits           Exhibit    Number       Description     3.1       Restated and Amended   Articles of Incorporation of Team Financial, Inc. (1)     3.2       Amended Bylaws of Team   Financial, Inc. (1)     4.1       Form of Indenture.   (5)     4.2       Form of   Subordinated Debenture (included as Exhibit A to Exhibit 4.1). (5)     4.3       Certificate of Trust.   (5)     4.4       Trust Agreement. (5)     4.5       Form of Amended and   Restated Trust Agreement. (5)     4.6       Form of Preferred   Securities Certificate (included as Exhibit D to Exhibit 4.5). (5)     4.7       Form of Preferred   Securities Guarantee Agreement. (5)     4.8       Form of Agreement   as to Expenses and Liabilities (included as Exhibit C to   Exhibit 4.5). (5)     10.1       Employment Agreement   between Team Financial, Inc. and Robert J. Weatherbie effective   January 1, 2005. (6)     10.2       Employment Agreement   between Team Financial, Inc. and Michael L. Gibson effective   January 1, 2005. (6)     10.5       Data Processing Services   Agreement between Team Financial, Inc. and Metavante Corporation dated   March 1, 2001. (5)     10.6       401K Plan of Team   Financial, Inc. 401(k) Trust, effective January 1, 1999 and   administered by Nationwide Life Insurance Company. (1)     10.7 - 10.10       Exhibit numbers   intentionally not used.     10.11       Team   Financial, Inc. Employee Stock Ownership Plan Summary. (1)     10.12       Team   Financial, Inc. 1999 Stock Incentive Plan. (1)     10.13       Rights Agreement between   Team Financial, Inc. and American Securities Transfer &   Trust, Inc. dated June 3, 1999. (1)     10.14       Team   Financial, Inc.—Employee Stock Purchase Plan. (1)     88          10.15       Revolving Credit   Agreement between between Team Financial, Inc. and US Bank dated   March 18, 2004. (7)     10.18       Deferred Compensation   Agreement between TeamBank, N.A. and Robert J. Weatherbie dated   February 1, 2002. (3)     10.19       Salary Continuation   Agreement between TeamBank, N.A. and Robert J. Weatherbie dated July 1,   2001. (3)     10.20       Split Dollar Agreement   between TeamBank, N.A. and Robert J. Weatherbie dated January 25, 2002.   (3)     10.21       Deferred Compensation   Agreement between TeamBank, N.A. and Michael L. Gibson dated February 1,   2002. (3)     10.22       Salary Continuation   Agreement between TeamBank, N.A. and Michael L. Gibson dated July 1, 2001.   (3)     10.23       Split Dollar Agreement   between TeamBank, N.A. and Michael L. Gibson dated January 25, 2002. (3)     10.24       Deferred Compensation   Agreement between TeamBank, N.A. and Carolyn S. Jacobs dated February 1,   2002. (3)     10.25       Salary Continuation Agreement   between TeamBank, N.A. and Carolyn S. Jacobs dated July 1, 2001. (3)     10.26       Split Dollar Agreement   between TeamBank, N.A. and Carolyn S. Jacobs dated January 25, 2002. (3)     10.29       Employment Agreement   between Team Financial, Inc. and Carolyn S. Jacobs effective   January 1, 2005. (6)     10.30       Stock Purchase Agreement   dated February 7, 2005 between TeamBank N.A. and International Insurance   Brokers, Ltd. LLC. (8)     11.1       Statement regarding   Computation of per share earnings—see consolidated financial statements.     21       Subsidiaries of Team   Financial, Inc. (9)     23       Consent of KPMG LLP (8)     24       Power of attorney—see   signature page     31.1       Certification of Chief   Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of   2002 (9)     31.2       Certification of Chief   Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of   2002 (9)     32.1       Certification of Chief   Executive Officer Pursuant to 18 U.S.C. §1350, as Adopted Pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002 (9)     32.2       Certification of Chief   Financial Officer Pursuant to 18 U.S.C. §1350, as Adopted Pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002 (9)       89         (1)       Filed with Registration Statement on Form S-1,   as amended, (Registration Statement No. 333-76163) and   incorporated herein by reference.     (2)       Filed with Form 8-K dated   December 18, 2002 and incorporated herein by reference.     (3)       Filed with the Annual Report on Form 10-K   for December 31, 2002, and incorporated herein by reference.     (4)       Filed with the quarterly report on Form 10-Q   for the period ended September 30, 2000, and incorporated herein by   reference.     (5)       Filed with Registration Statement on Form S-1   dated July 12, 2001, as amended, (Registration Statement No. 333-64934)   and is incorporated herein by reference.     (6)       Filed with quarterly report on Form 10-Q   for the period ended March 31, 2005, and incorporated herein by   reference.     (7)       Filed with the quarterly report on Form 10-Q   for the period ended March 31, 2004, and incorporated herein by   reference.     (8)       Filed with Annual Report on Form 10-K for   the year ended December 31, 2004, and incorporated herein by reference.     (9)       Filed Herewith.       90     SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in Paola, Kansas on March 30, 2006.           TEAM FINANCIAL, INC.             By:                             /s/ ROBERT J. WEATHERBIE                     Robert J.   Weatherbie,                     Chairman   and Chief Executive Officer                     /s/   MICHAEL L. GIBSON                     Michael L.   Gibson,                     President   of Investments and Chief Financial Officer      91    POWER OF ATTORNEY Each individual whose signature appears below hereby designates and appoints Robert J. Weatherbie and Michael L. Gibson, and each of them, as such person’s true and lawful attorneys-in-fact and agents (the Attorneys-in-Fact) with full power of substitution and resubstitution, for each person and in such person’s name, place, and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Annual Report on Form 10-K for the year ended December 31, 2005, which amendments may make such changes in this Annual Report on Form 10-K as either Attorney-in-Fact deems appropriate and to file each such amendment with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission, granting unto such Attorneys-in-Fact and each of them, full power and authority to do and perform each and every act and think requisite and necessary to be done in and about the premises, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that such Attorneys-in-Fact or either of them, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities indicated on March 30, 2006. SIGNATURES    /s/ ROBERT J. WEATHERBIE       Director, Chairman and   Chief Executive       March 30, 2006     Robert   J. Weatherbie       Officer (Principal   Executive Officer)             /s/ MICHAEL L.   GIBSON       Director,   President of Investments and       March 30,   2006     Michael   L. Gibson       Chief Financial Officer             /s/ GERALD   (JERRY) D. WIESNER       Director       March 30,   2006     Gerald   (Jerry) D. Wiesner                     /s/ R.G.   (GARY) KILKENNY       Director       March 30,   2006     R.G.   (GARY) Kilkenny                     /s/ CAROLYN S.   JACOBS       Director       March 30,   2006     Carolyn   S. Jacobs                     /s/ LLOYD A.   BYERHOF       Director       March 30,   2006     Lloyd   A. Byerhof                     /s/ DENIS A.   KURTENBACH       Director       March 30,   2006     Denis   A. Kurtenbach                     /s/ KEITH B.   EDQUIST       Director       March 30,   2006     Keith   B. Edquist                     /s/ KENNETH L.   SMITH       Director       March 30,   2006     Kenneth   L. Smith                      92     Exhibit Index     Exhibit    Number               Description     3.1       Restated and Amended   Articles of Incorporation of Team Financial, Inc.(1)     3.2       Amended Bylaws of   Team Financial, Inc.(1)     4.1       Form of   Indenture.(5)     4.2       Form of   Subordinated Debenture (included as Exhibit A to Exhibit 4.1).(5)     4.3       Certificate of   Trust.(5)     4.4       Trust Agreement.(5)     4.5       Form of Amended   and Restated Trust Agreement.(5)     4.6       Form of Preferred   Securities Certificate (included as Exhibit D to Exhibit 4.5).(5)     4.7       Form of Preferred   Securities Guarantee Agreement.(5)     4.8       Form of Agreement   as to Expenses and Liabilities (included as Exhibit C to Exhibit 4.5).(5)     10.1       Employment   Agreement between Team Financial, Inc. and Robert J. Weatherbie   effective January 1, 2005.(6)     10.2       Employment   Agreement between Team Financial, Inc. and Michael L. Gibson   effective January 1, 2005.(6)     10.5       Data Processing   Services Agreement between Team Financial, Inc. and Metavante   Corporation dated March 1, 2001.(5)     10.6       401K Plan of Team   Financial, Inc. 401(k) Trust, effective January 1, 1999 and   administered by Nationwide Life Insurance C ompany.(1)     10.7–10.10       Exhibit numbers   intentionally not used.     10.11       Team   Financial, Inc. Employee Stock Ownership Plan Summary.(1)     10.12       Team   Financial, Inc. 1999 Stock Incentive Plan.(1)     10.13       Rights Agreement   between Team Financial, Inc. and American Securities Transfer &   Trust, Inc. dated June 3, 1999.(1)     10.14       Team   Financial, Inc.—Employee Stock Purchase Plan.(1)     10.15       Revolving Credit   Agreement between Team Financial, Inc. and US Bank dated March 18,   2004.(4)     10.18       Deferred   Compensation Agreement between TeamBank, N.A. and Robert J. Weatherbie dated   February 1, 2002.(3)     10.19       Salary   Continuation Agreement between TeamBank, N.A. and Robert J. Weatherbie dated   July 1, 2001.(3)     10.20       Split Dollar   Agreement between TeamBank, N.A. and Robert J. Weatherbie dated   January 25, 2002.(3)     10.21       Deferred   Compensation Agreement between TeamBank, N.A. and Michael L. Gibson dated   February 1, 2002.(3)     93          10.22       Salary   Continuation Agreement between TeamBank, N.A. and Michael L. Gibson dated   July 1, 2001.(3)     10.23       Split Dollar   Agreement between TeamBank, N.A. and Michael L. Gibson dated January 25,   2002.(3)     10.24       Deferred   Compensation Agreement between TeamBank, N.A. and Carolyn S. Jacobs dated   February 1, 2002.(3)     10.25       Salary   Continuation Agreement between TeamBank, N.A. and Carolyn S. Jacobs dated   July 1, 2001.(3)     10.26       Split Dollar   Agreement between TeamBank, N.A. and Carolyn S. Jacobs dated January 25,   2002.(3)     10.29       Employment   Agreement between Team Financial, Inc. and Carolyn S. Jacobs effective   January 1, 2005.(6)     10.30       Stock Purchase   Agreement dated February 7, 2005 between TeamBank N.A. and International   Insurance Brokers, Ltd. LLC.(8)     11.1       Statement   regarding Computation of per share earnings—see consolidated financial   statements.     21       Subsidiaries of   Team Financial, Inc. (9)     23       Consent of KPMG   LLP(9)     24       Power of   attorney—see signature page     31.1       Certification of   Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley   Act of 2002(9)     31.2       Certification of   Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley   Act of 2002(9)     32.1       Certification of   Chief Executive Officer Pursuant to 18 U.S.C. §1350, as Adopted Pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002(9)     32.2       Certification of   Chief Financial Officer Pursuant to 18 U.S.C. §1350, as Adopted Pursuant to   Section 906 of the Sarbanes-Oxley Act of 2002(9)      (1)          Filed with Registration Statement on Form S-1, as amended, (Registration Statement No. 333-76163) and incorporated herein by reference. (2)          Filed with Form 8-K dated December 18, 2002 and incorporated herein by reference.  (3)          Filed with Annual Report on Form 10-K for December 31, 2002, and incorporated herein by reference. (4)          Filed with quarterly report on Form 10-Q for the period ended September 30, 2000, and incorporated herein by reference. (5)          Filed with Registration Statement on Form S-1 dated July 12, 2001, as amended, (Registration Statement No. 333-64934) and is incorporated herein by reference.  (6)          Filed with quarterly report on Form 10-Q for the period ended March 31, 2005, and incorporated herein by reference. 94    (7)          Filed with quarterly report on Form 10-Q for the period ended March 31, 2004, and incorporated herein by reference. (8)          Filed with Annual Report on Form 10-K for the year ended December 31, 2004, and incorporated herein by reference. (9)          Filed herewith. 95        EX-21 2 a06-2182_1ex21.htm SUBSIDIARIES OF THE REGISTRANT       Exhibit 21   Subsidiaries of the Registrant   The consolidated subsidiaries of the Registrant as of March 1, 2006 were as follows:              State or Other             Jurisdiction of     Subsidiary       Incorporation     Post Bancorp, Inc.       Colorado     Colorado National Bank       Colorado                   Team Financial Acquisition Subsidiary, Inc.       Kansas     TeamBank, National Association       Kansas     TeamBank, N.A. Asset Corporation       Kansas     TBNA Holdings, LLC       Missouri     TBNA REIT, LLC       Missouri                   Team Financial Capital Trust 1       Delaware                EX-23 3 a06-2182_1ex23.htm CONSENTS OF EXPERTS AND COUNSEL       Exhibit 23   Consent of Independent Registered Public Accounting Firm   The Board of Directors Team Financial, Inc.:   We consent to the incorporation by reference in the registration statement (No. 333-74424) on Form S-8 of Team Financial, Inc. of our report dated March 24, 2006, with respect to the consolidated statements of financial condition of Team Financial, Inc. as of December 31, 2005 and 2004, and the related consolidated statements of operations, comprehensive income, changes in stockholders’ equity, and cash flows, and for each of the years in the three-year period ended December 31, 2005, which report appears in the December 31, 2005 annual report on Form 10-K of Team Financial, Inc.      /S/ KPMG LLP                     Kansas   City, Missouri     March 30, 2006                EX-31.1 4 a06-2182_1ex31d1.htm 302 CERTIFICATION       EXHIBIT 31.1 Certification of Chief Executive Officer Under Section 302 of the Sarbanes-Oxley Act of 2002 I, Robert J. Weatherbie, Chief Executive Officer of Team Financial, Inc., certify that: 1.                I have reviewed this Annual Report on Form 10-K of Team Financial, Inc. (“registrant”); 2.                Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.                Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.                The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) for the registrant and have: (a)           Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)          [reserved] (c)           Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)          Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5.                The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)           All significant deficiencies and material weaknesses in the design of operation of internal control over financial reporting which are reasonably likely to adversely effect the registrant’s ability to record, process, summarize and report financial information; and (b)          Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.    Date: March 30, 2006         Signature:   /s/   ROBERT J. WEATHERBIE             Robert J. Weatherbie         Title:   Chief Executive Officer                 EX-31.2 5 a06-2182_1ex31d2.htm 302 CERTIFICATION       Exhibit 31.2 Certification of Chief Financial Officer Under Section 302 of the Sarbanes-Oxley Act of 2002 I, Michael L. Gibson, Chief Financial Officer of Team Financial, Inc., certify that: 1.                I have reviewed this Annual Report on Form 10-K of Team Financial, Inc. (“registrant”); 2.                Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.                Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.                The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) for the registrant and have: (a)           Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)          [reserved] (c)           Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)          Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5.                The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): (a)           All significant deficiencies and material weaknesses in the design of operation of internal control over financial reporting which are reasonably likely to adversely effect the registrant’s ability to record, process, summarize and report financial information; and (b)          Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.    Date: March 30, 2006         Signature:   /s/   MICHAEL L. GIBSON             Michael L. Gibson         Title:   Chief Financial Officer                 EX-32.1 6 a06-2182_1ex32d1.htm 906 CERTIFICATION       Exhibit 32.1   Certification of Chief Executive Officer of Team Financial, Inc. Pursuant to 18 U.S.C. Section §1350, Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002   I, Robert J. Weatherbie, certify that:   In connection with the Annual Report on Form 10-K of Team Financial, Inc. (the Company) for the period ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Robert J. Weatherbie, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:   1.                                       the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and   2.                                       the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.          /s/ ROBERT J. WEATHERBIE             Name:   Robert J. Weatherbie         Title:   Chief Executive Officer         Date:   March 30, 2006                      EX-32.2 7 a06-2182_1ex32d2.htm 906 CERTIFICATION       Exhibit 32.2   Certification of Chief Financial Officer of Team Financial, Inc. Pursuant to 18 U.S.C. §1350, Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002   I, Michael L. Gibson, certify that:   In connection with the Annual Report on Form 10-K of Team Financial, Inc. (the Company) for the period ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Michael L. Gibson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:   1.                                       the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and   2.                                       the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.          /s/ MICHAEL L. GIBSON             Name:   Michael L.   Gibson         Title:   Chief Financial   Officer         Date:   March 30,   2006                      -----END PRIVACY-ENHANCED MESSAGE-----