OFFER OF EMPLOYMENT

1.

Position with the Company . Upon the first day of your employment (“Date of Hire”), you will serve as Senior Vice President and Chief Financial Officer of the Company. You may be called upon to serve in other capacities from time-to-time during your tenure with the Company. You will faithfully and diligently perform all duties commensurate with these positions, including those duties directed by the Company’s Chief Executive Officer (“CEO”) to whom you will report directly. Your first day of employment will be October 31, 2005, or such other date as you and the Company shall mutually agree.

2.

Compensation . You will receive the following compensation for your services:

(a)

You will receive a minimum base salary of $300,000 per year, which may be increased, but not decreased, at the discretion of the Company (the “Base Salary”). The Base Salary will be paid in equal installments in accordance with the Company’s salary payment policies as in effect from time to time, and such salary payments will be subject to the usual withholding for income tax and other customary deductions.

(b)

Your target annual bonus compensation shall be one hundred percent (100%) of your then-current Base Salary for each year during the term of your employment, if the Company achieves the annual Performance Goals as solely determined by the Board; provided that you may be entitled to receive annual bonus compensation in an aggregate amount up to one hundred and fifty percent (150%) of your then-current base salary for each year during the term of your employment if the Board deems it consistent with the achievement of the Performance Goals for such year. The Performance Goals, and the percentage of bonus compensation tied to each, will be specifically defined by the Board in its sole discretion, but will likely include some or all of the following: revenue growth, gross margin, earnings per share, market share growth and development of the organization (the “ Performance Goals ”). The determination as to whether the Company has achieved the Performance Goals will be made by the Board in its sole and reasonable discretion, and the bonus will be paid to you within five (5) business days following such determination.

(c)

Effective upon your execution of this Letter, the Board will grant to you an option for the purchase of 100,000 shares of common stock of the Company (the “Option”) pursuant to the Company’s Long-Term Incentive Plan with a per share exercise price equal to the closing market price of a share of common stock on the date of grant. The Option will vest in 1/3 increments on the first, second and third anniversaries of the date of grant.

(d)

Effective upon your execution of this Letter the Board will grant to you fifty thousand (50,000) shares of restricted common stock of the Company pursuant to the Long-Term Incentive Plan, restricted by achievement of the Performance Goals to be established by the Board for fiscal years 2006 and 2007, as follows: (i) fifty percent (50%) of the restricted common stock, or twenty-five thousand (25,000) shares of common stock, will vest based upon substantial achievement of 2006 Performance Goals as determined by the Board and (ii) the remaining fifty percent (50%) of the restricted common stock, or twenty-five thousand (25,000) shares of common stock, will vest based upon substantial achievement of 2007 Performance Goals as determined by the Board; provided, however, that if the Board, in its review of the Performance Goals, determines that you achieved a personal rating of one hundred percent (100%) or higher in either fiscal year 2006 or 2007, the entire fifty thousand (50,000) shares of restricted common stock granted pursuant to this subsection (d) shall vest. If either or both of the 2006 or 2007 Performance Goals are not fully and completely achieved, the proportion of the restricted common stock which shall vest pursuant to this subsection 2(d) shall be determined in the Board’s sole discretion taking into account the Performance Goals achieved for such year, in both quantitative and qualitative degree. The Company will also provide to you a Gross-up Payment in connection with the restricted common stock grant (but not on the cash so paid) pursuant to this subsection 2(d).

(e)

You will be eligible, but not entitled, to receive additional grants of stock options and restricted capital stock of the Company in such quantities and subject to such conditions as the Board may determine in its sole and absolute discretion.

(f)

You covenant and agree that, as soon as practicable but in no event more than three (3) years from your Date of Hire, you will beneficially own, hold and retain  shares of common stock of the Company equal in value to your Base Salary for such given year (the “ Minimum Ownership ”); provided, however, that this covenant shall not be construed to require you to purchase shares of the Company’s common stock on the open market for the sole purpose of achieving the Minimum Ownership. You also covenant and agree that you will not sell or dispose of, or cause anyone else to sell or dispose of, any common stock of the Company that you have received (i) as a result of this Letter or (ii) pursuant to any other Company compensation, until and unless you have achieved (and will continue to maintain following such sale or disposition) the Minimum Ownership.

(g)

You may participate in any incentive compensation plan, pension or profit sharing plan, stock purchase plan, group benefit plan, medical plan, bonus plan and/or other benefit plans, either currently in effect or as may be established from time to time by the Board, for which you as an officer of the Company are eligible to participate. You acknowledge that you will not be entitled to any benefits under any discretionary plan unless actually provided to you in accordance with such plan.

(h)

You will be eligible, but not entitled; to receive such other compensation as may from time to time be granted to you by the Board in its sole and absolute discretion, including additional bonuses approved by the Board or the Board’s Compensation Committee.

(i)

You will be permitted to take vacations and sick leave, in accordance with the Company’s policies and procedures as in effect for officers of the Company.

3.

Benefits and Employment Matters . You will be eligible for medical, dental and vision care on the first day of the month following your Date of Hire. In addition, you will be eligible for the following Hypercom benefits as of your Date of Hire: eight named holidays, disability insurance, life insurance, travel accident insurance, 401(k) Plan. Further, upon reaching the first quarterly enrollment for which you qualify, you will be eligible for the Hypercom Employee Stock Purchase Plan, and after one year of full time employment you will be eligible for tuition reimbursement.