EX-10.4






March 21, 2005




Mr. Grant Lyon




Re: Employment Agreement



Dear Grant:



Upon execution by you, this letter will constitute your employment agreement (this
“Agreement”) with Hypercom Corporation (the “Company”).




	 	1.	 	Term. This Agreement will be effective as of March 22, 2005 and will terminate on
September 22, 2005, unless mutually extended by the parties in writing.






	 	2.	 	Position with the Company. During the term of this Agreement, you will serve as
interim Chief Financial Officer of the Company. You will faithfully and diligently perform all
duties commensurate with this position, including those duties directed by the Company’s Board
of Directors (the “Board”), as well as those set forth in the Company’s Bylaws that relate to
such position. It is expected that you will devote a majority of your weekly working hours to
this position, with you and the Company having estimated that you will spend approximately 30
hours per week on the Company’s business. You will report directly to the Chief Executive
Officer of the Company.






	 	3.	 	Compensation. You will receive a salary of $35,000 per month. Your 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 federal and state income taxes and FICA. You will not participate in any bonus plan of
the Company.






	 	4.	 	Vacation. With the concurrence of the Chief Executive Officer, you will be permitted
to take vacations and sick leave.






	 	5.	 	Business Expenses. The Company will pay or reimburse you for all ordinary and
necessary business expenses incurred or paid by you in furtherance of the Company’s business,
in accordance with the Company’s policies and procedures.






	 	6.	 	No Employee Benefits. Notwithstanding anything to the contrary in this Agreement,
the Company will not provide, and you will not be entitled to receive, any employee benefits,
including, without limitation, medical benefits, retirement benefits or other fringe benefits
(except as provided in Paragraphs 4 and 5 above) or any options to purchase the Company’s
stock or other equity grants. Without limiting the generality of the preceding sentence, the
Company will not be obligated to provide any employee benefits to you despite your eligibility
to participate in any of the Company’s employee benefit programs, whether such participation
would be of little or no additional cost to the Company. Except as provided in Paragraphs 4
and 5 above, you hereby acknowledge and agree to not participate in any of the Company’s
employee benefit programs and agree to execute any and all documents and take such further
action necessary to effectuate the intent of the parties under this Paragraph 6. However, as
a Company executive officer, you will be covered by the Company’s director and officer
liability insurance policies.





7. Termination for Cause or by Voluntary Resignation.




	 	(a)	 	The Company may terminate you for Cause, as defined below. Upon any
termination for Cause, or in the event that you voluntarily resign from the Company,
you will be entitled to receive only that compensation due you through the date of
termination or resignation, as the case may be.






	 	(b)	 	For purposes of this Agreement, “Cause” means if the Board, in its reasonable
and good faith discretion, determines that you (i) have developed or pursued interests
substantially adverse to the Company, (ii) have materially breached any employment or
confidentiality agreement or otherwise failed to satisfactorily discharge your duties,
(iii) have not devoted a majority of your business time, effort and attention to the
affairs of the Company (or such lesser amount as has been agreed to in writing by the
Company), (iv) are charged with or convicted of a felony, or (v) have engaged in
activities or omissions that are detrimental to the well-being of the Company.





8. Death or Disability.




	 	(a)	 	If during the term of this Agreement you die, then this Agreement will
terminate and your estate will be entitled to receive the compensation due you through
September 22, 2005 (or the date of your death if this Agreement is mutually extended by
the parties past September 22, 2005).






	 	(b)	 	If during the term of this Agreement you become so disabled or incapacitated by
reason of any physical or mental illness or any drug or alcohol addiction so as to be
unable to perform the services required of you pursuant to this Agreement for a
continuous period of one month, then, at the option of the Company, this Agreement will
terminate at the end of such one month period, provided that during such period of
disability or incapacity, you will be paid the full salary and expenses otherwise
payable to you.






	 	9.	 	Termination by the Company Other than for Cause. In the event that you are
terminated without Cause, or in the event a new Chief Financial Officer is hired by the
Company, you will be entitled to receive the compensation due you through September 22, 2005
(or the date of termination if this Agreement is mutually extended by the parties past
September 22, 2005) upon effectiveness of the release contemplated by Paragraph 16 below.






	 	10.	 	Confidential Information and Non-Disclosure. You hereby agree to execute and deliver
to the Company the Hypercom Employee Non-Disclosure Agreement attached hereto as Exhibit
A.






	 	11.	 	Personal Rights and Obligations. This Agreement and all rights and obligations
hereunder are personal and will not be assignable by either you or the Company except as
provided in this Paragraph 11, and any purported assignment in violation thereof will be null
and void. Any person, firm or corporation succeeding to the business of the Company by
merger, consolidation, purchase of assets or otherwise will assume by contract or operation of
law the obligations of the Company hereunder and in such a case you will continue to honor
this Agreement with such business substituted for the Company as the employer.






	 	12.	 	Notices. Any notice, election or communication to be given under this Agreement will
be in writing and delivered in person or deposited, certified or registered, in the United
States mail, postage prepaid, addressed as follows:






If to the Company:




Hypercom Corporation


2851 West Kathleen Road


Phoenix, Arizona 85053


Attn: General Counsel




If to you:


Grant Lyon




or to such other addresses as the Company or you may from time to time designate by notice
hereunder. Notices will be effective upon delivery in person or upon receipt of any
facsimile or e-mail, or at midnight on the fourth business day after the date of mailing, if
mailed.




	 	13.	 	Entire Agreement. Except for the Hypercom Employee Non-Disclosure Agreement attached
hereto as Exhibit A to which you are subject, this Agreement constitutes and embodies
the full and complete understanding and agreement of the Company and you with respect to your
employment by the Company and supersedes all prior understandings or agreements whether oral
or in writing. This Agreement may be amended only by a writing signed by you and the Company.
This Agreement may be executed in any number of counterparts, each of which will be
considered a duplicate original.






	 	14.	 	Arbitration. Any controversy relating to this Agreement or relating to the breach
hereof will be settled by arbitration conducted in Phoenix, Arizona in accordance with the
Commercial Arbitration Rules of the American Arbitration Association then in effect. The
award rendered by the arbitrator(s) will be final and judgment upon the award rendered by the
arbitrator(s) may be entered upon it in any court having jurisdiction thereof. The
arbitrator(s) will possess the powers to issue mandatory orders and restraining orders in
connection with such arbitration. The expenses of the arbitration will be borne by the losing
party unless otherwise allocated by the arbitrator(s). This agreement to arbitrate will be
specifically enforceable under the prevailing arbitration law. During the continuance of any
arbitration proceedings, the parties will continue to perform their respective obligations
under this Agreement. Nothing in this Agreement will preclude the Company or any affiliate or
successor from seeking equitable relief, including injunction or specific performance, in any
court having jurisdiction, in connection with any obligations of confidentiality.






	 	15.	 	Governing Law. This Agreement will be governed by and interpreted in accordance with
the laws of the State of Arizona.






	 	16.	 	Withholding and Release. You acknowledge and agree that payments made to you
hereunder may be subject to withholding. You further acknowledge and agree that payment of
any compensation to be provided to you under this Agreement following any termination of your
employment is subject to your compliance with any reasonable and lawful policies or procedures
of the Company relating to employee severances, including the execution and delivery by you of
a release reasonably satisfactory to the Company of any and all claims that you may have
against the Company or related persons, except for (i) the continuing obligations provided
herein, and (ii) for any continuing obligations of indemnification due you as an officer (or a
former officer).






Very truly yours,




/s/ C. S. Alexander




	 	 	 	Christopher S. Alexander

Chief Executive Officer





ACCEPTED:



/s/ Grant Lyon


Grant Lyon



Date: March 21, 2005