Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

BETWEEN

 

TEAM FINANCIAL, INC.

 

AND

 

MICHAEL L. GIBSON

 

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TABLE OF CONTENTS

 

Section

 

 

1.

Term of Agreement and Definitions

 

 

2.

Entire Agreement

 

 

3.

Validity

 

 

4.

Paragraphs and other headings

 

 

5.

Successors

 

 

6.

Designation of beneficiaries

 

 

7.

Duties

 

 

8.

Salary, Bonus, Benefits, Additional Compensation

 

 

9.

Protection of Company’s Interests

 

 

10.

Termination by Company

 

 

11.

Termination by Executive

 

 

12.

Consequences of Breach

 

 

13.

Mitigation and Offset

 

 

14.

Tax “Gross-Up” Provision

 

 

15.

Remedies

 

 

16.

Binding Agreement

 

 

17.

Arbitration

 

 

18.

Amendment; Waiver

 

 

19.

Governing Law

 

 

20.

Notices

 

 

Signatures

 

(i)

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EMPLOYMENT AGREEMENT

BETWEEN

TEAM FINANCIAL, INC.

AND

MICHAEL L. GIBSON

 

This Agreement is made this 1st day of January, 2003, between Team Financial,
Inc., a Kansas corporation (“Company”) and Michael L. Gibson (“Executive”).

 

A.                                    Executive is employed as President of
Investments/CFO, has rendered valuable services to Company and has acquired an
extensive background in and knowledge of Company’s business.

 

B.                                    Company desires to continue the services
of Executive and Executive desires to continue to serve Company as President of
Investments/CFO.

 

In consideration of the foregoing recitals and the agreements set forth herein,
Company and Executive agree as follows:

 

1.                                      Term of Agreement and Definitions:

 

1.0                               Term of Agreement:  Company shall employ
Executive and Executive accepts such employment for a period beginning on the
date of this Agreement and ending the 31st day of December, 2005, subject to the
terms and condition set forth herein, unless earlier termination of the
agreement shall occur in accordance with the subsequent provisions set forth
herein.

 

1.1                               Automatic Extension of Agreement Term:  Not
withstanding the foregoing, if this Agreement shall not have been terminated in
accordance with the provisions herein on or by the 31st day of December, 2005
the term of this Agreement shall be extended automatically without further
action by either party such that at every moment of time thereafter, the term
shall be one year.

 

Provided, however, during such period of automatic extension of the term, this
Agreement may be terminated in accordance with the termination provisions of
this Agreement as set forth in Sections 10 and 11.

 

1.2                               Definitions: The following definitions shall
be used in the interpretation of this Agreement.

 

1.2.1                     Employment on an active full time basis means the
Executive’s professional services shall be substantially devoted to Company. 
Although prior approval by the Company of Executive’s employment by third
parties is not required, the Company shall have the right to review any
employment of Executive by any entity and shall have the right to require
Executive to abandon any unsuitable employment as may be determined by Company
or any activities competitive with Company. The term “active full time basis”
includes the requirement that Executive refrain from any activities which
interfere with Executive’s Company duties.

 

1.2.2                     Year, Month, Week and Day, unless otherwise provided
in this agreement, the word “year” shall be construed to mean a calendar year of
365 days, the word “month” shall be construed to mean a calendar month, the word
“week” shall be construed to mean a calendar week of 7 days, and the word “day”
shall be construed to mean a period of 24 hours running from midnight to
midnight.

 

1.2.3                     Annual Base Salary is the sum of money regularly paid
by Company to Executive each year of the term of this Agreement pursuant to
provisions of Section 8.0 of this Agreement.

 

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1.2.4                     Customary payroll practices are those policies and
procedures routinely followed by the Company concerning the time and method of
payment of compensation to its employees as may from time to time be adopted by
the Company during course of this Agreement.

 

1.2.5                   Company policies are those written policies adopted by
the Company and/or customary practices routinely followed by the Company which
may from time to time be adopted by the Company during the course of the
Agreement.  The parties acknowledge the Company may from time to time reasonably
enact new policies or alter existing policies.

 

1.2.6                     Organization as used herein shall be broadly defined
to include any business, civic or community group or entity.

 

1.2.7                     Willful Misconduct is any act performed with a
designed purpose or intent on the part of a person to do wrong.

 

1.2.8                     Gross misappropriation of funds shall be any
misappropriation of company funds by any means which is intentional and not of
an inconsequential nature or amount.

 

2.                                      Entire Agreement

 

2.0                                 With respect to the matters specified
herein, this Agreement contains the entire agreement between the parties and
supersedes all prior oral and written agreements, understandings and commitments
between the parties.  This Agreement shall not affect the provisions of any
other compensation, retirement or other benefit programs of Company to which
Executive is a party or of which he is a beneficiary.

 

3.                                      Validity

 

3.0                                 In the event that any provision of this
Agreement is held to be invalid, void or unenforceable, the same shall not
affect, in any respect whatsoever, the validity of any other provision of the
Agreement.

 

4.                                      Paragraphs and other headings

 

4.0                                 Paragraphs and other headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.

 

5.                                      Successors

 

5.0                                 The rights and duties of a party hereunder
shall not be assignable by that party; provided, however, that this Agreement
shall be binding upon and inure to the benefit of any successor of Company, and
any such successor shall be deemed substituted for Company under the terms of
this Agreement.  The term “successor” as used herein shall include any person,
firm, corporation or other business entity which at any time, by merger,
purchase or otherwise, acquires all or substantially all of the assets or
business of Company.

 

6.                                      Designation of beneficiaries

6.0                                 If Executive should die during the term of
this Agreement, all such sums due to Executive hereunder shall be paid as
designated by Executive on the attached Beneficiary Designation Form.

 

6.1                                 The spouse of the Executive shall join in
any designation of a beneficiary other than the spouse.

 

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6.2                                 If Executive wholly fails to designate a
beneficiary as provided for in this paragraph, or if the Executive’s spouse at
the time of his death shall not have joined in the designation of a beneficiary,
then the sums due Executive shall be paid to his estate.

 

7.                                      Duties

 

7.0                                 Company employs Executive upon an active
full-time basis, as President of Investments/CFO subject to the order and
direction of the Chief Executive Officer (“CEO”) of Company.

 

7.1                                 During the term of this Agreement Executive
shall devote substantially all of his time, attention, and best efforts to the
business of Company and its subsidiaries.  Executive shall perform such duties
and shall exercise such power and authority as delegated by the CEO from time to
time provided that such duties are commensurate with the position of President
of Investments/CFO.  Executive may engage in other non-business activities such
as charitable, educational, religious and similar types of activities so long as
such activities do not prevent the performance of Executive’s duties herein or
conflict in any material way with the business of Company.  Notwithstanding the
above, Executive shall be permitted to serve as a Director or Trustee of other
organizations, in accordance with the policies of Company.

 

7.2                                 The duties of President of Investments/CFO
shall be defined using a written job definition, developed by CEO on behalf of
Company.  The CEO shall consult with Executive in the development of the written
job definition.  Executive and said written job definition shall be subject to
any systematic evaluation system(s) that the Company may from time to time
employ.

 

7.3                                 Executive’s duties shall be performed
principally at Company’s headquarters located in Paola, Kansas.  During the term
of the Agreement, it is understood that Company expects to maintain its
principal place of business in Paola, Kansas.

 

8.                                      Salary, Bonus, Benefits, Additional
Compensation

 

8.0                               Annual Base Salary.

 

Executive shall receive an annual base salary of $155,250.00 payable according
to the customary payroll practices of Company and subject to all required
withholding taxes.  The Chief Executive Officer, in his discretion, may increase
this base salary upon relevant circumstances.  Executive will be reviewed at
least annually.  At least every two years Company will review Executive’s annual
base salary for competitiveness and appropriateness in the industry.  Any
increase in annual base salary awarded to the Executive by the Company, shall
constitute a new annual base salary for the purpose of this Agreement. To be
effective such changes in the annual base salary shall be in writing signed by
the Company.

 

8.1                               Bonus.

 

8.1.1                     Standard Company Bonuses.  Executive shall be eligible
to receive, in addition to his salary, any contributions or sums specified as
additional compensation through any established plan or policy of the Company
which is available to senior executives as compensation over and above
established salaries.

 

8.1.2                     Annual Executive Bonus.  In addition, Executive shall
be entitled to receive a yearly annual bonus.  The amount of such bonus shall be
based upon criteria established by the CEO and may include either or both stock
and cash.  Provided, however, such bonus shall not exceed fifty percent (50%) of
Executive’s annual base salary in effect for the period for which the bonus is
granted.  During the term of this Agreement, the yearly annual bonus shall be
paid not later than January 31 of the calendar year following annual bonus year.

 

8.2                               Benefits.

 

8.2.0                        Executive shall be entitled to receive all benefits
generally made available to executives of Company as may from time to time be in
effect.

 

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8.2.1                        Executive shall be entitled, in addition to life
insurance coverage in effect for all employees, to a life insurance policy in
the amount of $240,000.00 all premiums to be paid by Company.

 

8.2.2                        Executive shall be entitled to participate, during
the term of the Agreement, under the terms and conditions thereof, in any group
life, medical, dental or other health and welfare plans generally available to
management personnel of Company which may be in effect from time to time;
provided that nothing herein shall require the Company to establish or maintain
such plans.

 

8.2.3                        Executive Expenses. Executive shall be entitled to
reimbursement for business expenses.  Executive shall be expected to incur
various business expenses customarily incurred by persons holding like
positions, including but not limited to traveling, entertainment and similar
expenses, all of which are to be incurred by Executive for the benefit of
Company.  Executive shall be subject to Company’s policies regarding the
reimbursement and non-reimbursement of said expense.  Executive acknowledges
that Company policies do not necessarily provide for the reimbursement of all
expenses.

 

8.2.4                        Special Executive Allowance.  Company agrees to pay
reasonable room, board, travel, and sponsored event expenses of Executive’s
spouse on two (2) business trips per year of Executive’s choice.

 

8.2.5                        Accounting.  Executive shall account to Company for
any reimbursement or payment of such expenses in such a manner as Company
practices may from time to time require.  Subject to Company’s policy regarding
the payment of reimbursable expenses, Company shall reimburse Executive for such
expenses from time to time, at Executive’s request.

 

8.2.6                        Company shall indemnify and hold Executive harmless
for any legal fees and expenses incurred by Executive in the performance of his
duties as a result of civil or criminal actions against him in accordance with
the indemnification provisions of the Articles of Incorporation and Bylaws of
Company.

 

8.2.7                        During (i) the term of this Agreement, (ii) the
twelve month period following the termination of this Agreement as a result of
death, (iii) a two year period following the termination of this Agreement as a
result of disability, (iv) a three year period following termination of this
Agreement by Executive for material breach or good cause, and (v) a three year
period following a termination of this Agreement by Company without cause;
Company shall pay to Executive, or his estate if he be deceased, a sum as
reimbursement for reasonable out-of-pocket expenses incurred for third-party
professional financial and tax advice provided by a licensed professional of
Executive’s choice.  Provided, however, that in (i) above, the sum shall not
exceed fifteen percent (15%) of Executive’s annual base salary for that year;
(ii) above, the sum shall not exceed twenty-five percent (25%) of Executive’s
annual base salary for that year; (iii), (iv) and (v) above, the sum shall not
exceed twenty-five percent (25%), each year, of Executive’s annual base salary
at the time of Executive’s disability or time of termination.

 

8.2.8                        Executive shall be provided with a personal
automobile under arrangements equivalent to those currently in effect with
respect to other Company executives and of equivalent size and features as
presently driving.

 

8.3                                 Additional Compensation.

 

Executive shall be eligible to receive, in addition to his salary, any
contributions or sums specified for additional compensation through any
established plan or policy of Company which is available to senior executives as
compensation over and above established salaries, including but not limited to
stock options.

 

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8.4                                 Tax Liability.

 

Any tax liability which these benefits create for Executive will be the sole
responsibility of Executive.

 

9.                                      Protection of Company’s Interests

 

9.0                                 During the term of this Agreement Executive
shall not directly or indirectly engage in competition with, or not own any
interest in any business which competes with, any business of Company; provided,
however, that the provisions of this Section 9 shall not prohibit his ownership
of not more than 5% of voting stock of any publicly held corporation.

 

9.1                                 Except for actions taken in the course of
his employment hereunder, at no time shall Executive divulge, furnish or make
accessible to any person any information of a confidential or proprietary nature
obtained by him while in the employ of Company.  Upon termination of his
employment by Company, Executive shall return to Company all such information
which exists in writing or other physical form and all copies thereof in his
possession or under his control.

 

9.2                                 Company, its successors and assigns, shall,
in addition to Executive’s services, be entitled to receive and own all of the
results and proceeds of said services (including, without limitation, literary
material and other intellectual property) produced or created during the term of
Executive’s employment hereunder.  Executive will, at the request of Company,
execute such assignments, certificates or other instruments as Company may from
time to time deem necessary or desirable to evidence, establish, maintain,
protect, enforce or defend its right or title to any such material.

 

10.                               Termination by Company

 

10.0                           Company shall have the right to terminate this
Agreement under the following circumstances:

(i)                                     Upon the death of Executive;

(ii)                                  Upon the disability of Executive;

(iii)                               Upon material breach or good cause; and

(iv)                              Upon written notice by Company without cause.

(v)                                 Upon written notice by Company, during the
period of automatic extension of the term, of Company’s

intention to have this Agreement expire in one year.

 

10.1         If Executive dies before his employment with Company is otherwise
terminated, Executive’s designated beneficiary, or in the absence of a
designated beneficiary, the estate of the Executive, will receive all sums due
under the Split Dollar Agreement and Deferred Compensation Agreement between
Executive and TeamBank, N. A. then in existence.  In the event the total amount
paid to the beneficiaries or the estate of Executive is less than $500,000.00,
Company shall pay to the designated beneficiary of Executive, or in the absence
of a designated beneficiary, to the estate of Executive, as soon as reasonably
practical, a sum equal to the difference between the total amount paid under the
Split Dollar Agreement and $500,000.00.  Under this section it is the intent of
the Company and Executive that the Executive’s beneficiary, or in the absence of
a designated beneficiary, to the estate of Executive, receive in total death
benefits shall not be less than $500,000.00. Company may purchase life insurance
to cover all or any part of its obligations contained in this section. Executive
agrees to take a physical examination to facilitate the Company’s purchase of
such insurance.  In the event that Executive is uninsurable, Company may elect
to disperse any funds owed by Company under this section in equal monthly
payments over the remaining period of the year of Executive’s death, or if less
than six (6) months, over a period of twelve (12) consecutive months. 
Executive’s dependents will also be entitled to:

 

(i)                                     All Company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination, provided, however, that if Company so elects, or such continued
participation is not possible under the general terms and conditions of such
plans or under such policies, Company shall, in lieu of the foregoing, arrange
to have issued for the benefit of Executive’s dependents equivalent benefits (on
an after-tax basis); provided, further that, in no event shall Executive’s
dependents be required to pay any premiums or other charges in an

 

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amount greater than that which Executive would have paid in order to participate
in Company’s plans and policies.

 

Entitlement (i) above shall be maintained in effect for the continued benefit of
Executive’s dependents for a period of six (6) months after the date of
termination due to death.

 

10.2                           For the purposes of this Agreement, Executive
shall be deemed to have become disabled, if, during any year of the term of this
Agreement, because of ill health, physical or mental impairment, or for other
causes beyond Executive’s control, Executive shall have been continuously unable
or unwilling, or shall have failed to perform his duties under this Agreement
for ninety (90) consecutive days, or if, during any calendar year of the term of
this Agreement, Executive shall have been unable or unwilling or shall have
failed to perform his duties for a total period of one hundred eighty (180)
days, irrespective of whether or not such days are consecutive.  With respect to
any termination by Company for disability, the specifics of the basis of
termination shall be communicated to Executive in writing at least thirty (30)
days before the date on which the termination is proposed to take effect. 
Executive shall have until the effective date of the notice to cure or remedy
such disability and or correct the misconception of the disability.  If this
Agreement is terminated for disability, any questions as to the existence of the
Total and Permanent disability of Executive as to which Executive and Company
cannot agree shall be determined in writing by a qualified independent physician
mutually acceptable to Executive and Company.  If Executive and Company cannot
agree as to a qualified independent physician, each shall appoint such a
physician and those two physicians shall select a third who shall make such
determination in writing.  If there is a disagreement between Executive and
Company as to the disability of Executive, the effective date of the termination
will be extended a reasonable time to allow for a determination by a physical,
as described above.  Any refusal by Executive to submit to a medical examination
for the purpose of certifying disability under this section shall be deemed to
constitute evidence of Executive’s disability.  If Executive is disabled before
his employment with Company is otherwise terminated, Company shall continue to
pay the current annual base salary for the remainder of the contract to the
Executive, or if the Executive is totally incapacitated, to his appointed
guardian, at the time he is determined to be disabled.  Whenever compensation is
payable to Executive hereunder, during a time when he is disabled, pursuant to
the terms of any insurance provided by Company, the compensation payable to him
hereunder shall be inclusive of any such disability insurance and shall not be
in addition thereto.  If this agreement is terminated for disability Executive
shall also be entitled to:

 

(i)                                     All Company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination paid for by the company for a period of one year provided,
further that, in no event shall Executive be required to pay any premiums or
other charges in an amount greater than that which Executive would have paid in
order to participate in Company’s plans and policies..

(ii)                                  The group individual life insurance
policies of Company then in effect for Executive for a period of one year;
provided that if Company so elects, or such continued participation is not
possible under the general terms and conditions of such plans or under such
policies, Company shall, in lieu of the foregoing, arrange to have issued for
the benefit of Executive and Executive’s dependents equivalent benefits (on an
after-tax basis); provided, further that, in no event shall Executive be
required to pay any premiums or other charges in an amount greater than that
which Executive would have paid in order to participate in Company’s plans and
policies.

(iii)                               All such Bonuses and Other Compensation as
provided for in Section 8 above, it being understood, however, that all such
payments due, if made pursuant to this clause shall be paid in cash within
thirty (30) days of the date of termination.  All stock options granted by
Company to Executive under any provision of Section 8 or granted by Company to
Executive prior to the date hereof will accelerate and become immediately
exercisable;

(iv)                              Company shall pay Executive a sum to pay for a
Paola Country Club membership dues for one (1) year;

(v)                                 Company shall transfer to Executive title of
the personal car, furnished Executive by Company, in use at the time of the
termination.

 

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10.3                           For purposes of this Agreement, material breach
and good cause shall mean willful misconduct in following the legitimate
directions of the Chief Executive Officer; commission of a significant act of
dishonesty, deceit or breach of fiduciary duty in the performance of Executive’s
duties; gross misappropriation of Company funds or property; habitual
drunkenness; excessive absenteeism not related to illness, sick leave or
vacations.  Provided, however, Executive shall be entitled to notice of any acts
which the CEO considers to be misconduct or excessive absenteeism as described
in this paragraph.  Such notice shall include the specifics of the basis for
possible termination and shall be communicated to Executive in writing at least
thirty (30) days prior to any such intended termination.  Prior to any such
termination, if requested before the effective date of the intended termination,
Executive shall be given a reasonable period of time in which to show that he
has corrected any specified deficiencies.  Upon the cure or remedy of such
deficiencies, the Company shall rescind its notice of termination.  If there is
any question about the effective correction of the deficiencies, a decision will
be sought from a lawyer agreed to by Company and Executive.  If the Company and
Executive cannot agree on a lawyer, each will pick a lawyer who will together
pick a lawyer who will render a decision.

 

If this agreement is terminated for material breach or good cause, Executive
shall be entitled to:

(i)                                     All Company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination; and

(ii)                                     The group individual life insurance and
disability policies of Company then in effect for Executive;

provided, however, that if Company so elects, or such continued participation is
not possible under the general terms and conditions of such plans or under such
policies, Company shall, in lieu of the foregoing, arrange to have issued for
the benefit of Executive and Executive’s dependents equivalent benefits (on an
after-tax basis); provided, further that, in no event shall Executive be
required to pay any premiums or other charges in an amount greater than that
which Executive would have paid in order to participate in Company’s plans and
policies.

 

Entitlement of (i) and (ii) of this section shall be maintained in effect for
the continued benefit of the Executive and his dependents for a period of six
(6) months after the date of termination or until the commencements of each
equivalent benefit from Executive’s new employer, but not to be provided longer
than six (6) months.

 

10.4                           Company shall be entitled to terminate this
Agreement without cause upon ninety (90) days written notice to Executive.  If
Company shall so terminate this Agreement, Executive shall be entitled to:

(i)                                     All Company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination; and

(ii)                                  The group individual life insurance and
disability insurance policies of Company then in effect for Executive; 
provided, however, that if Company so elects, or such continued participation is
not possible under the general terms and conditions of such plans or under such
policies, Company shall, in lieu of the foregoing, arrange to have issued for
the benefit of Executive and Executive’s dependents equivalent benefits (on an
after-tax basis); provided, further that, in no event shall Executive be
required to pay any premiums or other charges in an amount greater than that
which Executive would have paid in order to participate in Company’s plans and
policies.

 

Entitlement of (i) and (ii) of this section shall be maintained in effect for
the continued benefit of Executive and his dependents for a period of three (3)
years after the date of termination or until the commencement of each equivalent
benefit from Executive’s new employer, but not to be provided longer than three
(3) years after the date of termination.

(iii)                               A furnished office, like his Company office,
from which to operate for a period of six (6) months or until Executive accepts
employment with another employer, which ever occurs first.  Executive’s office
will be provided, at Company’s expense, with a desk; phone; access to fax for
outgoing and incoming faxes; computer, software, and access to a printer.

(iv)                              A cash payment equal to the present value
(based on a discount rate equal to the then current 5 year treasure note with a
floor of 5% and a ceiling of 9%) of Executive’s annual base salary hereunder for
the remainder of the term of the Agreement, or for one (1) year, which ever is
longer, payable within thirty (30) days of the date of such termination;

 

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(v)                                 All such Bonuses and Other Compensation as
provided for in Section 8 above, it being understood, however, that all such
payments due, if made pursuant to this clause shall be paid in cash within
thirty (30) days of the date of termination.  All stock options granted by
Company to Executive under any provision of Section 8 or granted by Company to
Executive prior to the date hereof will accelerate and become immediately
exercisable;

(vi)                              A sum as reimbursement for reasonable
out-of-pocket expenses incurred for third-party professional financial and tax
advice provided by a licensed professional of Executive’s choice for a period of
three (3) years after the date of termination, sum not to exceed, in any one
year, twenty-five percent (25%) and in the aggregate, seventy-five percent (75%)
of Executive’s base salary, as provided in Section 8;

(vii)                           A sum as reimbursement for reasonable
out-of-pocket expenses incurred for out-placement advice and counseling provided
by a professional placement agency and/or recruiter of Executive’s choice for a
period of twelve (12) months after date of termination, sum not to exceed fifty
percent (50%) of Executive’s base salary, as provided in Section 8;

(viii)                        Company shall pay Executive a sum to pay for Paola
Country Club membership dues for one (1) year;

(ix)                                Company shall transfer to Executive title of
the personal car, furnished Executive by Company, in use at the time of the
termination.

10.5                           Company shall be entitled to terminate this
Agreement during the period of automatic extension of the term as set forth in
section 1.1, by giving written notice to Executive of the company’s intention to
have the term of this Agreement expire one year from the date of such
notification.  If Company shall so terminate this agreement, Executive shall be
entitled only to those benefits provided under existing law.

 

10.6                           Company may purchase life insurance to cover all
or any part of its obligations contained in this paragraph and Executive agrees
to take a physical examination to facilitate the placement of such insurance. 
In the event that Executive is uninsurable, Company may elect to disperse the
funds due in equal monthly payments over the remaining period of the year due,
or if less than six (6) months, over a period of twelve (12) consecutive months.

 

11.                               Termination by Executive

 

11.0                           Executive shall have the right to terminate this
Agreement under the following circumstances:

(i)                                     Upon material breach or good cause; and

(ii)                                  Upon written notice to the Chief Executive
Officer without cause.

 

11.1                           For purposes of this Agreement, a material breach
by Company of the terms of this Agreement shall entitle Executive, upon written
notice to the Company, to terminate his services under this Agreement effective
thirty (30) days from and after receipt of such notice by Company.  Such notice
shall include a specific description of such breach and the Company shall have
until the effective date of the notice to cure or remedy such breach.  Upon the
cure or remedy of such breach, the Executive shall rescind his notice of
termination.  For purposes of this Agreement, a termination for good cause by
Executive shall be based upon the following action by the Company:  a failure,
without good cause to continue Executive as President of Investments/CFO of
Company; a failure, without good cause to continue to vest Executive with the
power and authority of President of Investments/CFO of Company; the loss,
without good cause of Executive’s consent, of any significant duties or
responsibilities attending such office.  Provided, however, Executive’s title,
duties and responsibilities shall be deemed to be altered with good cause by the
Chief Executive Officer if Company is (or substantially all of its assets are)
sold to or combined with another entity and Executive shall thereafter continue
to have the same significant duties and responsibilities with respect to
Company’s continuing business and if Executive shall report to the Chief
Executive Officer of the continuing Company with a like Agreement, for a term no
less than that remaining on this Agreement or two (2) years, whichever is
longer.  Upon the occurrence of any happening which would authorize Executive to
terminate his employment for good cause, Executive shall notify the Chief
Executive Officer in writing within sixty (60) days following such occurrence or
Executive shall be deemed to have waived his right to terminate this Agreement
for such occurrence.  The Chief Executive Officer shall have until the effective
date of the notice to cure or remedy such good cause occurrence.  Upon the cure
or remedy of

 

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such good cause occurrence, the Executive shall rescind his notice of
termination.  Upon termination of employment by Executive for material breach or
good cause, Executive shall be entitled to:

(i)                                     All company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination; and

(ii)                                  The group individual life insurance and
disability insurance policies of Company then in effect for Executive; provided,
however, that if Company so elects, or such continued participation is not
possible under the general terms and conditions of such plans or under such
policies, Company shall, in lieu of the foregoing, arrange to have issued for
the benefit of Executive and Executive’s dependents equivalent benefits (on an
after-tax basis); provided, further that, in no event shall Executive be
required to pay any premiums or other charges in an amount greater than that
which Executive would have paid in order to participate in Company’s plans and
policies.

 

Entitlement of (i) and (ii) of this section shall be maintained in effect for
the continued benefit of Executive and his dependents for a period of three (3)
years after the date of termination or until the commencement of each equivalent
benefit from Executive’s new employer, but not to be provided longer than three
(3) years after the date of termination.

(iii)                               A furnished office, like his Company office,
from which to operate for a period of one (1) year or until Executive accepts
employment with another employer, which ever occurs first.  Executive’s office
will be provided, at Company expense, with a desk; phone; access to fax for
outgoing and incoming faxes; computer, software, and access to printer.

(iv)                              A cash payment equal to the present value
(based on a discount rate equal to the then current 5 year treasure note with a
floor of 5% and a ceiling of 9%) of Executive’s base salary hereunder for the
remainder of the term of the Agreement, or for one (1) year, which ever is
longer, payable within thirty (30) days of the date of such termination;

(v)                                 All such Bonuses and Other Compensation as
provided for the Section 8 above, it being understood, however, that all such
payments due, if made pursuant to this clause shall be paid in cash within
thirty (30) days of the date of termination.  All stock options granted by
Company to Executive under any provision of Section 8 or granted by Company to
Executive prior to the date hereof will accelerate and become immediately
exercisable;

(vi)                              A sum as reimbursement for reasonable
out-of-pocket expenses incurred for third-party professional financial and tax
advice provided by a licensed professional of Executive’s choice for a period of
three (3) years after date of termination, sum not to exceed, in any one year,
twenty five  percent (25%) and in the aggregate, seventy five percent (75%) of
Executive’s base salary, as provided in Section 8;

(vii)                           A sum as reimbursement for reasonable
out-of-pocket expenses incurred for out-placement advice and counseling provided
by a professional placement agency and/or recruiter of Executive’s choice for a
period of twelve (12) months after date of termination, sum not to exceed fifty
(50) percent of Executive’s base salary.

(viii)                        Company shall pay Executive a sum to pay for Paola
Country Club membership dues for one (1) year; and

(ix)                                Company shall transfer to Executive title of
the personal car, furnished Executive by company, in use at the time of the
termination.

 

11.2                           Company may purchase life insurance to cover all
or any part of its obligations contained in this paragraph and Executive agrees
to take a physical examination to facilitate the placement of such insurance. 
In the event that Executive is uninsurable, Company may elect to disperse the
funds due in equal monthly payments over the remaining period of the year due,
or if less than six (6) months, over a period of twelve (12) consecutive months.

 

11.3                           Executive shall be entitled to terminate this
Agreement without cause upon ninety (90) days written notice to Company.  If
Executive shall so terminate this Agreement, Executive shall be entitled to
those benefits provided under existing law.

 

11.4                           If Company is (or substantially all of its assets
are) sold to or combined with another entity, Executive shall have the exclusive
right and option to approve any resulting salary, benefits, title, duties and/or
responsibilities of Executive if the entity offers Executive continuing
employment

 

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with the entity or in the alternative Executive shall be entitled to terminate 
this Agreement for good cause and shall have all of the entitlements set forth
in Section 11.1 (i) through (ix) except the entitlement provided for in (iv)
which shall be void in these circumstances and the following shall be
substituted therefore; “(iv) A cash payment equal to the present value (based on
a discount rate equal to the then current 5 year treasure note with a floor of
5% and a ceiling of 9%) of Executives base after-tax salary hereunder for the
remainder of the term of this Agreement, or for three (3) years, which ever is
longer, payable within thirty days of the date of such termination.”Executive
shall also be entitled to:

 

(i)                                     All Company insured and self insured
medical and dental plans in which Executive was participating immediately prior
to termination; and

(ii)                                  The group individual life insurance and
disability insurance policies of Company then in effect for Executive; provided,
however, that if Company so elects, or such continued participation is not
possible under the general terms and conditions of such plans or under such
policies, Company shall, in lieu of the foregoing, arrange to have issued for
the benefit of Executive and Executive’s dependents equivalent benefits (on an
after-tax basis); provided, further that, in no event shall Executive be
required to pay any premiums or other charges in an amount greater than that
which Executive would have paid in order to participate in Company’s plans and
policies.

 

Entitlement of (i) and (ii) of this section shall be maintained in effect for
the continued benefit of Executive and his dependents for a period of three (3)
years after the date of termination or until the commencement of each equivalent
benefit from Executive’s new employer, but not to be provided longer than three
(3) years after the date of termination.

 

(iii)                               A furnished office, equivalent to his
Company office, from which to operate for a period of one (1) year or until
Executive accepts employment with another employer, which ever occurs first. 
Executive’s office will be provided, at Company’s expense, with a desk;
credenza; phone; access to fax for outgoing and incoming faxes; computer,
software, and printer.  All of the above will be equivalent to what Executive
was using at the time of termination.

(iv)                              All such Bonuses and Other Compensation as
provided for in Section 8 above, it being understood, however, that all such
payments due, if made pursuant to this clause shall be paid in cash within
thirty (30) days of the date of termination.  All stock options granted by
Company to Executive under any provision of Section 8 or granted by Company to
Executive prior to the date hereof will accelerate and become immediately
exercisable;

(v)                                 A sum as reimbursement for reasonable
out-of-pocket expenses incurred for third-party professional financial and tax
advice provided by a licensed professional of Executive’s choice for a period of
three (3) years after the date of termination, sum not to exceed, in any one
year, twenty-five percent (25%) and in the aggregate, seventy-five percent (75%)
of Executive’s base salary, as provided in Section 8;

(vi)                              A sum as reimbursement for reasonable
out-of-pocket expenses incurred for out-placement advice and counseling provided
by a professional placement agency and/or recruiter of Executive’s choice for a
period of twelve (12) months after date of termination, sum not to exceed fifty
percent (50%) of Executive’s base salary, as provided in Section 8;

(vii)                           Company shall pay Executive a sum to pay for
Paola Country Club membership dues for one (1) year;

(viii)                        Company shall transfer to Executive title of the
personal car, furnished Executive by Company, in use at the time of the
termination.

 

12.                               Consequences of Breach

 

12.0                           If this Agreement is terminated pursuant to
Section 11.01 hereof, or if Company shall terminate Executive’s employment under
this Agreement in any other way that is a breach of this Agreement by Company,
the following shall apply:

(i)                                     The parties believe that because of the
limitations of Section 11 the payments to Executive do not constitute “Excess
Parachute Payments” under Section 280G of the Internal Revenue Code of 1954, as
amended (the “Code”).  Notwithstanding such belief, if any benefit under the
preceding paragraph is determined to be an “Excess Parachute Payment” Company
shall

 

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pay Executive an additional amount (“Tax Payment”) such that (x) the excess of
all Excess Parachute Payments (including payments under this sentence) over the
sum of excise tax thereon under Section 4999 of the Code and income tax thereon
under Subtitle A of the Code and under applicable state law is equal to (y) the
excess of all Excess Parachute Payments (excluding payments under this sentence)
over income tax thereon under Subtitle A of the Code and under applicable state
law.

 

13.                               Mitigation and Offset

 

13.0                           Executive shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking employment or
otherwise, nor to offset the amount of any payment provided for in this
Agreement by amounts earned as a result of Executive’s employment or
self-employment during the period he is entitled to such payment.

 

14.                               Tax “Gross-Up” Provision

 

14.0                           If any payment due Executive under this Agreement
results in Executive’s liability for an excise tax (“parachute tax”) under
Section 49 of the Internal Revenue Code of 1986, as amended (the “Code”), the
Company will pay to Executive, after deducting any Federal, state or local
income tax imposed on the payment, an amount sufficient to fully satisfy the
“parachute tax” liability.  Such payment shall be made to Executive no later
than thirty (30) days prior to the due date of the “parachute tax”.

 

15.                               Remedies

 

15.0                           Company recognizes that because of Executive’s
special talents, stature and opportunities in the financial services industry,
in the event of termination by Company hereunder (except under Section 10.0), or
in the event of termination by Executive under Section 11, before the end of the
agreed term, Company acknowledges and agrees that the provisions of this
Agreement regarding further payments of base salary, bonuses and the
exerciseability of stock options constitute fair and reasonable provisions for
the consequences of such termination, do not constitute a penalty, and such
payments and benefits shall not be limited or reduced by amounts Executive might
earn or be able to earn from any other employment or ventures during the
remainder of the agreed term of this Agreement.

 

16.                               Binding Agreement

 

16.0                           This Agreement shall be binding upon and inure to
the benefit of Executive, his heirs, distributes and assigns and company, its
successors and assigns.  Executive may not, without the express written
permission of the Company, assign or pledge any rights or obligations hereunder
to any person, firm or corporation.

 

17.                               Arbitration

 

17.0                           Company and Executive agree that any dispute or
claim concerning this Agreement, or the terms and conditions of employment under
this Agreement, shall be settled by arbitration.  The arbitration proceedings
will be conducted under the Commercial Arbitration Rules of the American
Arbitration Association in effect at the time a demand for arbitration under the
Rules is made.  The decision of the arbitrators, including determination of the
amount of any damages suffered, will be exclusive, final and binding on Company
and Executive, their heirs, executors, administrators, successors and assigns. 
Each party will bear that party’s own expenses in the arbitration proceedings
for arbitrators’ fees and attorney fees, for that party’s witnesses, and other
expenses of presenting the case.  Other arbitration costs, including
administrative fees and fees for records or transcripts, will be borne equally
by Company and Executive.

 

18.                               Amendment; Waiver

 

18.0                           This instrument contains the entire agreement of
the parties with respect to the employment of Executive by Company and
supersedes any prior Agreement between Company and Executive (it being
understood, however, that this agreement shall not affect any stock options
granted to Executive prior to the

 

11

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date hereof).  No amendment or modification of this Agreement shall be valid
unless evidenced by a written instrument executed by the parties hereto.  No
waiver by either party of any breach by the other party of any provision or
condition of this Agreement shall be deemed a waiver of any similar or
dissimilar provision or condition at the same or any prior or subsequent time.

 

19.                               Governing Law

 

19.0                           This Agreement shall be governed by and construed
in accordance with the laws of the State of Kansas.

 

20.                               Notices

 

20.0                           All notices which a party is required or may
desire to give to the other party under or in connection with this Agreement
shall be given in writing by addressing the same to the other party as follows:

If to Executive, to:

Michael L. Gibson

205 Overhill Dr.

Paola, Kansas 66071

 

If to Company, to:

Team Financial, Inc.

Chairman of the Board

8 West Peoria

Paola, Kansas 66071

 

or at such other place as may be designated in writing by like notice.  Any
notice shall be deemed to have been given within forty-eight (48) hours after
being addressed as required herein and deposited, first-class postage prepaid,
in the United States mail.

 

IN WITNESS THEREOF, the parties have executed this agreement this          day
of                             , 2003, effective as of the day and year first
above written.

 

 

TEAM FINANCIAL, INC.

 

 

 

By:

 

 

 

 

Chief Executive Officer

 

 

 

MICHAEL L. GIBSON

 

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