UNITED
STATES
SECURITIES
AND EXCHANGE COMMISION
Washington, D.C. 20549
FORM 11-K
(Mark One)
ý ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year end 12/31/2002
OR
o TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQURIED)
For the transition period from to
Commission file number 000-26335
A. Full title of the plan and the address of the plan, if different from that of the issuer named below:
B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
TEAM FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Financial Statements and Schedules
December 31, 2002 and 2001
(With Independent Auditors’ Report Thereon)
Independent Auditors’ Report
To the Plan Advisory Committee of the
Team Financial, Inc. Employees’ Stock
Ownership Plan of Team Financial, Inc:
We have audited the accompanying statements of net assets available for plan benefits of the Team Financial, Inc. Employees’ Stock Ownership Plan as of December 31, 2002 and 2001 and the related statements of changes in net assets available for plan benefits for the years ended December 31, 2002, 2001, and 2000. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. 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 financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Team Financial, Inc. Employees’ Stock Ownership Plan as of December 31, 2002 and 2001 and the changes in net assets available for plan benefits for the years ended December 31, 2002, 2001, and 2000, in conformity with accounting principles generally accepted in the United States of America.
Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions are presented for the purpose of additional analysis and are not a required part of the basic financial statements, but are supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
|
|
June 6, 2003
TEAM FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2002 and 2001
|
|
|
2002 |
|
2001 |
|
|
|
Assets: |
|
|
|
|
|
|
|
Cash |
|
$ |
162,014 |
|
145,716 |
|
|
Investments, at fair value: |
|
|
|
|
|
|
|
Common stocks: |
|
|
|
|
|
|
|
Team Financial, Inc. |
|
11,550,110 |
|
10,116,898 |
|
|
|
Other |
|
389,310 |
|
592,313 |
|
|
|
U. S. government agency obligations |
|
— |
|
69,698 |
|
|
|
Interest and dividends receivable |
|
68,381 |
|
59,493 |
|
|
|
|
|
|
|
|
|
|
|
Net assets available for plan benefits |
|
$ |
12,169,815 |
|
10,984,118 |
|
See accompanying notes to financial statements.
2
TEAM FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Statements of Changes in Net Assets Available for Plan Benefits
For the years ended December 31, 2002, 2001, and 2000
|
|
|
2002 |
|
2001 |
|
2000 |
|
|
|
Additions to net assets attributed to: |
|
|
|
|
|
|
|
|
|
Appreciation (depreciation) in fair value of investments |
|
$ |
1,658,661 |
|
1,744,679 |
|
(2,496,650 |
) |
|
Dividend income |
|
260,379 |
|
249,237 |
|
257,372 |
|
|
|
Contributions from employer |
|
375,000 |
|
375,000 |
|
340,500 |
|
|
|
Interest income |
|
3,744 |
|
13,403 |
|
26,574 |
|
|
|
Transfers from other plan |
|
— |
|
— |
|
53,910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net additions |
|
2,297,784 |
|
2,382,319 |
|
(1,818,294 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Deductions from net assets attributed to: |
|
|
|
|
|
|
|
|
|
Distributions to participants |
|
1,112,073 |
|
1,182,000 |
|
1,148,826 |
|
|
|
Administrative expenses |
|
14 |
|
15 |
|
22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deductions |
|
1,112,087 |
|
1,182,015 |
|
1,148,848 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in net assets available for plan benefits |
|
1,185,697 |
|
1,200,304 |
|
(2,967,142 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net assets available for plan benefits: |
|
|
|
|
|
|
|
|
|
Beginning of year |
|
10,984,118 |
|
9,783,814 |
|
12,750,956 |
|
|
|
|
|
|
|
|
|
|
|
|
|
End of year |
|
$ |
12,169,815 |
|
10,984,118 |
|
9,783,814 |
|
See accompanying notes to financial statements.
3
TEAM
FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(1) Summary of Significant Accounting Policies
Organization
The Team Financial, Inc. Employees’ Stock Ownership Plan (the Plan) has been adopted by Team Financial, Inc. and its affiliates: TeamBank N.A., and Colorado National Bank. The Plan is administered by the Company as Plan Administrator and Trustee.
General
The Plan is a defined contribution plan subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The following description of the Plan provides only general information. Participants should refer to the Plan Agreement for a more complete description of the Plan’s provisions.
Basis of Presentation
The accompanying financial statements have been prepared on an accrual basis in conformity with accounting principles generally accepted in the United States of America and present net assets available for plan benefits and changes in those net assets. Dividend income is accrued on the ex-dividend date. Purchases and sales of investments are recorded on a trade-date basis. Realized gains and losses from security transactions are reported on the average cost method.
Income Taxes
The Plan has received a favorable determination letter from the Internal Revenue Service indicating that it is qualified under Section 401(a) of the Internal Revenue Code and, therefore, the related trust is exempt from tax under Section 501(a) of the Internal Revenue Code. The Plan Administrator has amended the Plan to conform to the Tax Reform Act of 1986 and has requested a determination letter from the Internal Revenue Service. The Plan Administrator is not aware of any activity or transactions that may adversely affect the qualified status of the Plan, as amended.
Use of Estimates
The Plan utilizes a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with generally accepted accounting principles. Actual results could differ from those estimates.
(2) Investment Policy and Contributions
Contributions to fund the Plan are determined by Team Financial’s Board of Directors. Contributions may be made in cash, common stock, or other investments as determined by the Board of Directors. Team Financial may make a contribution up to 15% of the compensation paid to participating employees during the Plan year. Pursuant to certain limitations set forth in the Internal Revenue Code, Team Financial may contribute additional amounts of up to 10% of the total compensation of all participants to apply to a principal repayment on the borrowings incurred for the purpose of acquiring common stock, and/or an amount without limitation if it is to be applied to the repayment of interest on borrowings incurred for the purpose of acquiring common stock.
4
The Plan does not permit contributions by participants.
(3) Provisions of the Plan
All employees are eligible to become participants of the Plan on the January 1 or July 1 following the later of six months of employment or age nineteen.
With limited exceptions, an employee must complete 1,000 hours of service during the Plan year and must be employed by the employer on the last day of the Plan year to be entitled to an allocation of Team Financial contributions. Contributions are allocated based upon vesting percentages as shown below:
|
Years of service |
|
Percent |
|
|
|
|
|
|
|
Less than 3 years |
|
— |
% |
|
3 years |
|
20 |
|
|
4 years |
|
40 |
|
|
5 years |
|
60 |
|
|
6 years |
|
80 |
|
|
7 years or more |
|
100 |
|
Participants are eligible for benefit distributions following death, disability, retirement, or other termination of employment. When a participant’s employment is terminated because of retirement, permanent disability, or death, then, unless the participant elects otherwise, the distributions of the participant’s account must commence not later that one-year after the close of the Plan year in which the event occurs. When a participant’s employment is terminated for any other reason, the form of the distribution depends on the balance in the participant’s account. If the vested balance is less than $5,000, the Plan will distribute that amount, in a lump sum, in the Plan year following the Plan year in which the participant terminates. If the vested account balance exceeds $5,000, then, unless the participant elects otherwise, the Plan will generally commence distributions of such amount in the Plan year following the date of termination. Distributions may be in a lump sum or installments. Generally, the portion of a participant’s account invested in Team Financial common stock will be distributed in the form of Team Financial common stock, and the remaining portion of the participant’s account will be distributed at the participant’s election, either in the form of Team Financial common stock or cash. Additionally, vested benefits may be paid to a participant if the participant reaches age sixty or if the participant reaches age fifty-five and has participated in the Plan for at least ten years.
Forfeitures are allocated to the account of each participant in the same manner as Company contributions.
5
(4) Investments
The Plan’s investments are stated at fair value as determined by quoted market prices.
The following presents the investment that represented 5% or more of the Plan’s net assets:
|
|
|
2002 |
|
2001 |
|
|
|
|
|
|
|
|
|
|
|
Team Financial, Inc. common stock |
|
$ |
11,550,110 |
|
10,116,898 |
|
The investment in Team Financial common stock represents approximately 29% and 28% of the outstanding common stock of Team Financial at December 31, 2002 and 2001, respectively. During the year ended December 31, 2002, the Plan purchased and sold 25,000 and 95,913 shares of Team Financial, Inc. common stock, a party-in-interest to the Plan.
During 2002, 2001, and 2000, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value as follows:
|
|
|
2002 |
|
2001 |
|
2000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
U. S. government agency obligations |
|
$ |
— |
|
(629 |
) |
4,286 |
|
|
Common stock |
|
1,658,661 |
|
1,745,308 |
|
(2,500,936 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,658,661 |
|
1,744,679 |
|
(2,496,650 |
) |
6
Schedule 1
TEAM FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Schedule of Assets Held for Investment Purposes at End of Year
December 31, 2002
|
Units |
|
Description of investment |
|
Fair |
|
Historical |
|
|
|
|
|
Common stock: |
|
|
|
|
|
|
|
1,126,840 |
|
Team Financial, Inc.* |
|
$ |
11,550,110 |
|
5,460,839 |
|
|
1,000 |
|
Abbot Laboratories |
|
40,000 |
|
37,775 |
|
|
|
600 |
|
AOL Time Warner, Inc. |
|
7,860 |
|
40,702 |
|
|
|
500 |
|
Bristol Myers Squibb Company |
|
11,575 |
|
35,398 |
|
|
|
1,000 |
|
Cisco Systems, Inc. |
|
13,100 |
|
35,926 |
|
|
|
1,048 |
|
Citigroup, Inc. |
|
36,879 |
|
36,589 |
|
|
|
400 |
|
Clorox Company |
|
16,500 |
|
16,614 |
|
|
|
500 |
|
Coca-Cola Company |
|
21,920 |
|
24,694 |
|
|
|
400 |
|
EMC Corporation |
|
2,456 |
|
14,029 |
|
|
|
1,792 |
|
Exxon Mobile Corporation |
|
62,612 |
|
66,535 |
|
|
|
500 |
|
Fannie Mae |
|
32,165 |
|
33,976 |
|
|
|
750 |
|
Gillette Company |
|
22,770 |
|
28,203 |
|
|
|
700 |
|
Intel Corporation |
|
10,899 |
|
28,309 |
|
|
|
700 |
|
McDonalds Corporation |
|
11,256 |
|
31,007 |
|
|
|
400 |
|
Merck & Co., Inc. |
|
22,644 |
|
30,872 |
|
|
|
600 |
|
Microsoft Corporation |
|
31,020 |
|
48,087 |
|
|
|
1,050 |
|
Pfizer, Inc. |
|
32,099 |
|
32,960 |
|
|
|
500 |
|
SBC Communications, Inc. |
|
13,555 |
|
25,131 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common stock |
|
11,939,420 |
|
6,027,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets held for investment purposes |
|
$ |
11,939,420 |
|
6,027,646 |
|
* Team Financial, Inc. is a party-in-interest to the Plan.
See accompanying independent auditors’ report.
7
Schedule 2
TEAM FINANCIAL, INC.
EMPLOYEES’ STOCK OWNERSHIP PLAN
Schedule of Reportable Transactions
Year ended December 31, 2002
|
Description |
|
Purchase |
|
Selling |
|
Expense |
|
Cost |
|
Current |
|
Net |
|
|
|
Cash equivalents |
|
$ |
1,532,152 |
|
— |
|
— |
|
1,532,152 |
|
1,532,152 |
|
— |
|
|
Cash equivalents |
|
— |
|
1,515,854 |
|
— |
|
1,515,854 |
|
1,515,854 |
|
— |
|
|
|
Team Financial, Inc. common stock* |
|
243,250 |
|
— |
|
— |
|
243,250 |
|
243,250 |
|
— |
|
|
|
Team Financial, Inc. common stock* |
|
— |
|
823,893 |
|
— |
|
444,403 |
|
823,893 |
|
379,490 |
|
|
See accompanying independent auditors’ report.
* Team Financial, Inc. is a party-in-interest to the Plan.
8
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 June 27, 2003.
|
|
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 |
|
|
|
|
9
EXHIBIT INDEX
|
23.1 |
|
Independent Auditor Consent |
10