Document:

<PAGE>   1
                                                                  Exhibit 10.7

THE SECURITIES EVIDENCED BY AND UNDERLYING THIS DOCUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES
LAW AND ACCORDINGLY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
DIRECTLY OR INDIRECTLY IN THE ABSENCE OF (I) AN EFFECTIVE REGISTRATION STATEMENT
RELATING THERETO, (II) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY
SATISFACTORY TO THE COMPANY (AS DEFINED BELOW), THAT SUCH REGISTRATION IS NOT
REQUIRED, (III) RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION THAT SUCH REGISTRATION IS NOT REQUIRED, (IV) COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (V) OTHERWISE
COMPLYING WITH THE PROVISIONS OF ARTICLE III OF THE WARRANT (AS DEFINED BELOW)
IN THE MANNER DESCRIBED BELOW.

                           CONVERTIBLE PROMISSORY NOTE

$__________                                                     Phoenix, Arizona
                                                                    June 4, 2001

          For value received, Hypercom Corporation (the "Company"), promises to
pay to _____________________________________, (the "Holder") the principal sum
of ___________________________________________________ ($__________) with
interest thereon from the date hereof until paid at a per annum rate equal to
seven and one half percent (7.5%), as follows:

          All principal and accrued interest due hereunder shall be due and
payable to the extent not previously paid or satisfied, on September 5, 2001
(the "Payment Date"). From the date hereof through the earlier of the (i)
Payment Date or (ii) the date on which the Company's obligations hereunder are
fully paid satisfied and discharged, interest shall be accrued daily on the
outstanding principal balance and shall be calculated on the basis of a 365 day
year. If any payment of interest and/or principal is not received by the Holder
when such payment is due, then, as additional remedies, all past due payments of
principal and/or interest shall bear interest from their due date until paid at
an annual rate equal to fifteen percent (15%), payable on demand.

          All payments of principal and interest on this Convertible Promissory
Note (this "Note") are payable in lawful money of the United States of America
at ____________________________________ or at such other place as the Holder may
designate in writing.

          All payments shall be credited first on late charges and costs of
collection, if any, and then on interest then due and the remainder on
principal, and interest shall thereupon cease upon the principal so credited.

          This Note may be prepaid at any time without penalty upon at least
fifteen (15) days' prior written notice to the Holder.
<PAGE>   2
          The Company hereby agrees to pay the contracted rate of interest,
which includes interest at the rate set forth herein and all costs and fees
associated with obtaining this credit accommodation to the extent any such costs
and fees are deemed interest under applicable law. This Note shall be construed
according to the laws of the State of Arizona (except for the provisions set
forth in the immediately succeeding paragraph which shall be governed by
Delaware law).

          During the term of this Note, the Holder may convert this Note, in
whole or in part, into shares of the Common Stock of the Company (the "Note
Shares") at a conversion price of $3.16 per share by delivering to the Company
at the address set forth in the Loan Agreement (as described below) (i) a duly
executed Notice of Conversion in the form of Exhibit "A" attached hereto, and
(ii) a duly executed Investment Representation Certificate in the form of
Exhibit "B" attached hereto. Concurrently herewith, the Company is granting the
lender a warrant (the "Warrant") to purchase 62,500 shares of the Company's
Common Stock. The provisions set forth in Articles II, III, IV, V, Section 6.3
and Article VII of the Warrant applicable to the Warrant and the shares of
Common Stock of the Company underlying the Warrant shall apply to this Note and
the Note Shares as if such terms were fully set forth herein (with due regard to
the need in applying such provisions to (i) replace references to "this Warrant"
in such provisions with "this Note", and (ii) replace references to "Warrant
Shares" in such provisions with "Note Shares").

          Any assignment of this Note by the Holder shall be accompanied by an
Assignment Form in the form of Exhibit "C" attached hereto, duly executed by the
Holder.

          This Note is one of the Notes referred to in, and issued pursuant to,
the Loan Agreement dated as of June 4, 2001 by and among the Company, as
borrower, George R. Wallner and the "Lenders" named therein.

          IN WITNESS WHEREOF, the Company has executed this Promissory Note as
of the day and year first above written.

                                                 HYPERCOM CORPORATION

                                                 By:____________________________

                                                 Its:___________________________

                                      -2-
<PAGE>   3
                                   EXHIBIT "A"

                            NOTICE OF CONVERSION FORM

              (To be executed only upon partial or full conversion
                  of the attached Convertible Promissory Note)

          The undersigned registered holder of the attached Convertible
Promissory Note (the "Note") hereby irrevocably converts $_____________ of the
Note for, and purchases ________ shares of, the Common Stock of Hypercom
Corporation, all at the price and on the terms and conditions specified in the
Note and requests that (i) a certificate (or _____ certificates in denominations
of ______________ shares, respectively) for the shares of Common Stock of
Hypercom Corporation hereby purchased be issued in the name of and delivered to
(choose one) (a) the undersigned or (b) [NAME]__________________________________
______________________________________, whose address is________________________
_______________________________________________________ and, (ii) if the Note is
not hereby converted in whole, that a new Convertible Promissory Note in the
same form as attached hereto but representing the remaining outstanding
principal amount of the Note not converted hereby be issued in the name of and
delivered to (choose one) (a) the undersigned or (b) [NAME]_____________________
_________________________________, whose address is ____________________________
______________________________.

Dated___________________________

Signature Guaranteed

________________________________

________________________________

                                    By:_________________________________________
                                        (Signature of Registered Holder of Note)

                                    Title:______________________________________

NOTICE: The signature to this Notice of Conversion must correspond with the name
as written upon the face of the attached Convertible Promissory Note in every
particular, without alteration or enlargement or any change whatever.
<PAGE>   4
                                   EXHIBIT "B"

                      INVESTMENT REPRESENTATION CERTIFICATE

Purchaser:_____________________________

Company: Hypercom Corporation (the "Company")
Security: Common Stock
Amount:____________________
Date:______________________

In connection with the purchase of the above-listed shares of Common Stock (the
"Note Shares"), the undersigned (the "Purchaser") hereby represents to the
Company as follows:

     (a)  PURCHASE FOR OWN ACCOUNT. The Note Shares are being acquired for
investment for the Purchaser's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and the Purchaser
has no present intention of selling, granting any participation in, or otherwise
distributing the Note Shares or any part thereof. The Purchaser does not have
any contract, undertaking, agreement or arrangement with any Person to sell,
transfer or grant participation to such Person with respect to the Note Shares
or any part thereof.

     (b)  DISCLOSURE OF INFORMATION. The Purchaser is aware of the Company's
business affairs and financial condition, has received and reviewed all
information (including all reports, registrations and other documents) filed by
the Company with the United States Securities and Exchange Commission (the
"Commission") up to the date hereof) it considers necessary or appropriate for
making an informed and knowledgeable decision as to whether to acquire this
Warrant and further represents that it has had sufficient opportunity to ask
questions and receive answers from the Company regarding the nature and affairs
of the Company, including its business, properties, prospects and financial
condition.

     (c)  INVESTMENT EXPERIENCE. The Purchaser is an investor in securities of
companies and acknowledges that it is capable of bearing the economic risk of
its investment in the Note Shares, including the risk of total loss of such
investment, and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of such
investment.

     (d)  ACCREDITED INVESTOR. The Purchaser is an "accredited investor" within
the meaning of Commission Rule 501 of Regulation D, as presently in effect.

     (e)  RESTRICTED SECURITIES. The Purchaser understands and hereby
acknowledges that (i) the Note Shares may not initially be registered under the
Securities Act, and in such event will be issued in reliance upon a specific
exemption from the registration requirements under the Securities Act, which
exemption depends upon, among other things, the bona fide nature of the
Purchaser's investment intent as expressed herein, and (ii) the Note Shares must
be held
<PAGE>   5
indefinitely unless subsequently registered under the Securities Act or unless
an exemption from registration is otherwise available.

     (f)  RULE 144 RESTRICTIONS. The Purchaser is aware of the provisions of
Rule 144, promulgated under the Securities Act, which, in substance, permit
limited public resale of "restricted securities" acquired, directly or
indirectly, from the issuer thereof (or from an affiliate of such issuer), in a
non-public offering subject to the satisfaction of certain conditions, if
applicable, including, among other things: (i) the availability of certain
public information about the Company; (ii) the resale occurring not less than
one (1) year after the party has purchased and paid for the securities to be
sold, unless registered; (iii) the sale being made through a broker in an
unsolicited "broker's transaction" or in transactions directly with a market
maker (as said term is defined under the Exchange Act), (iv) the amount of
securities being sold during any three-month period not exceeding the specified
limitations stated therein, and (v) the filing of Form 144 with the Commission.

     (g)  RULE 144 LIMITATIONS. The Purchaser understands and acknowledges that
at the time it wishes to sell some or all of the Note Shares there may not be an
active public market upon which to make such a sale, and that, even if such an
active public market upon which to make such a sale then exists, the Company may
not be satisfying the current public information requirements of Rule 144, and
that, in such event, the Purchaser may be precluded from selling the Note Shares
under Rule 144 even if the one-year minimum holding period had been satisfied or
the Note Shares registered. The Purchaser further understands that (i) if all of
the requirements of Rule 144 are not satisfied, registration under the
Securities Act, compliance with Regulation A or Regulation S under the
Securities Act or some other registration exemption will be required to permit
the Purchaser to sell the Note Shares, and (ii) notwithstanding the fact that
Rule 144 is not exclusive, the staff of the Commission has expressed its opinion
that persons proposing to sell private placement securities other than in a
registered offering and other than pursuant to Rule 144 will have a substantial
burden of proof in establishing that an exemption from registration is available
for such offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk.

Date:________________________, 20___         PURCHASER:

                                             ___________________________________

                                       2

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                                   EXHIBIT "C"

                                 ASSIGNMENT FORM

      (To be executed only upon the assignment of the attached Convertible
                                Promissory Note)

          FOR VALUE RECEIVED, the undersigned registered holder of the attached
Convertible Promissory Note (the "Note") hereby sells, assigns and transfers
unto _____________________, whose address is _________________________________,
$____________ principal amount and related interest, and related rights of the
undersigned under the Note, and if the Note is not hereby assigned in whole, the
undersigned hereby requests that Hypercom Corporation issue to the undersigned a
new Convertible Promissory Note in the same form as attached hereto but
representing the remaining outstanding principal amount of the Note not assigned
hereby, and irrevocably constitutes and appoints ________________________
______________________________ attorney to register such assignment on the books
of Hypercom Corporation maintained for such purpose, with full power of
substitution in the premises.

Dated:______________________

Signature Guaranteed

__________________________________

__________________________________

                                           By:__________________________________
                                               (Signature of Registered Holder)

                                           Title:_______________________________

NOTICE: The signature to this Assignment must correspond with the name upon the
face of the attached Convertible Promissory Note in every particular, without
alteration or enlargement or any change whatever.<PAGE>   1
                                                                  Exhibit 10.8

THE SECURITIES EVIDENCED BY AND UNDERLYING THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES
LAW AND ACCORDINGLY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED,
DIRECTLY OR INDIRECTLY IN THE ABSENCE OF (i) AN EFFECTIVE REGISTRATION STATEMENT
RELATING THERETO, (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED, (iii)
RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION THAT
SUCH REGISTRATION IS NOT REQUIRED, (iv) COMPLIANCE WITH REGULATION S UNDER THE
SECURITIES ACT OF 1933, OR (v) OTHERWISE COMPLYING WITH THE PROVISIONS OF
ARTICLE III OF THIS WARRANT.

                                    SERIES B
                          WARRANT TO PURCHASE SHARES OF
                                  COMMON STOCK
                                       OF
                              HYPERCOM CORPORATION

                                 Warrant No. ___

                               Dated: June 4, 2001

This certifies that for value received:

                              ____________________

or registered assigns, is entitled, subject to the terms set forth herein, to
purchase from Hypercom Corporation, a Delaware corporation, and any successor
thereto (the "COMPANY"), __________________________________ (______) fully paid
and non-assessable shares of the Company's Common Stock at the price equal to
Three Dollars and Sixteen Cents ($3.16) per share (the "EXERCISE PRICE"). The
Exercise Price and the number of shares of Common Stock purchasable hereunder,
are subject to adjustment in certain events, all as more fully set forth under
Article IV herein.
<PAGE>   2
                                    ARTICLE I

                                   DEFINITIONS

"BUSINESS DAY" means any day other than a Saturday or a Sunday or a United
States federal or Arizona state holiday.

"CERTIFICATE OF INCORPORATION" means the Certificate of Incorporation of the
Company and any amendments thereto, as filed with the Delaware Secretary of
State during the Exercise Period.

"CLOSING DATE" means the date of this Warrant as first above written.

"COMMISSION" means the Securities and Exchange Commission, or any other federal
agency then administering the Exchange Act or the Securities Act, as defined
herein.

"COMMON STOCK" means the Company's Common Shares, par value $0.001, any stock
into which such Common Stock shall have been changed or any stock resulting from
any reclassification of such stock, and any other capital stock of the Company
of any class or series now or hereafter authorized having the right to share in
distributions either of earnings or assets of the Company without limit as to
amount or percentage.

"COMMON STOCK OUTSTANDING" means at any time all shares of Common Stock that are
then outstanding, plus all shares of Common Stock issuable upon conversion of
the Convertible Securities and all shares of Common Stock issuable upon exercise
of the Options (assuming for this purpose that the securities acquirable upon
exercise of the Options are converted into Common Stock).

"COMPANY" means Hypercom Corporation, a Delaware corporation, and any successor
thereto.

"CONVERTIBLE SECURITIES" means evidences of indebtedness, shares of stock or
other securities which are convertible into or exchangeable for, with or without
payment of additional consideration, shares of Common Stock, either immediately
or upon the arrival of a specified date or the happening of a specified event or
both.

"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, or any
successor federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.

"EXERCISE PERIOD" means the two-year period during which this Warrant may be
exercised commencing on the Closing Date and expiring at 5:00 p.m. (Arizona
time) on the date immediately preceding the second annual anniversary of the
Closing Date.

                                       2
<PAGE>   3
"EXERCISE PRICE" means Three Dollars and Sixteen Cents ($3.16) per share of
Common Stock, as such price may be adjusted pursuant to Article IV hereof. The
Exercise Price shall be paid as set forth in Section 2.1 hereof.

"HOLDER" means the Person specified on the first page of this Warrant, or any
successor thereto or assignee thereof in whose name this Warrant is registered
on the books of the Company maintained for such purpose.

"OPTION" means any right, warrant or option to subscribe for or purchase shares
of Common Stock or Convertible Securities.

"PERSON" means and includes natural persons, corporations, limited partnerships,
general partnerships, joint stock companies, joint ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts,
government entities and authorities and other organizations, whether or not
legal entities.

"PRINCIPAL EXECUTIVE OFFICE" means the Company's office at 2851 West Kathleen
Road, Phoenix, Arizona 85053, or such other office as designated in writing to
the Holder by the Company.

"REGISTER," "REGISTERED" and "REGISTRATION" refer to a registration effected by
preparing and filing a registration statement in compliance with the Securities
Act, and the declaration or ordering of the effectiveness of such registration
statement.

"REGISTRATION STATEMENT" has the meaning ascribed to that term in Section 5.1.

"RULE 144" means Rule 144 as promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar successor
rule that the Commission may promulgate.

"SECURITIES ACT" means the Securities Act of 1933, as amended, or any successor
federal statute, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect from time to time.

"SHAREHOLDER" means a holder of one or more Warrant Shares or shares of Common
Stock.

"WARRANT" means this warrant dated as of the Closing Date, issued to the Holder,
subject to partial or full reissuance as provided herein upon the partial
exercise, transfer or division hereof.

"WARRANT SHARES" means _________________________ (_________) fully paid and
non-assessable shares of Common Stock issuable upon the exercise of this
Warrant, such number of shares to be subject to adjustment pursuant to Section
4.2. If under the terms

                                       3
<PAGE>   4
of this Warrant there shall be a change such that the securities purchasable
hereunder shall be issued by an entity other than the Company or there shall be
a change in the type or class of securities purchasable hereunder, then the term
"WARRANT SHARES" shall also mean such other type or class or the securities
issuable by such other entity.

                                   ARTICLE II

                                    EXERCISE

2.1   EXERCISE RIGHT; MANNER OF EXERCISE.

      (a) EXERCISE. The purchase rights represented by this Warrant may be
exercised by the Holder, in whole or in part, at any time and from time to time
during the Exercise Period upon (i) surrender of this Warrant, together with an
executed Notice of Exercise, substantially in the form of EXHIBIT "A" attached
hereto, at the Principal Executive Office, and (ii) payment to the Company of
the aggregate Exercise Price for the number of Warrant Shares specified in the
Notice of Exercise. Any exercise by the Holder of such purchase rights must be
for the purchase of a minimum of 50,000 Warrant Shares, except in the event that
less than 50,000 Warrant Shares are issuable at such time of exercise, in which
event such exercise must be for the purchase of all of such Warrant Shares
issuable. The Holder of this Warrant may, in its sole and exclusive discretion,
pay the Exercise Price for the Warrant Shares in cash or by forgiving any
portion or all of the unpaid principal and interest due under the Promissory
Note at the time of the exercise of this Warrant or by a combination of such
methods. If paid in cash, the Exercise Price shall be paid by check or wire
transfer. If paid by forgiveness of any portion or all of the unpaid principal
and interest due under the Promissory Note, the Holder shall advise the Company
in writing of the amount of the debt forgiveness and such amount shall be
treated as a payment under the Promissory Note. The Holder's right of exercise
under this subsection 2.1(a) shall terminate and be of no further force or
effect immediately after expiration of the Exercise Period.

      (b) ISSUE OF WARRANT SHARES. The Person or Person(s) in whose name(s) any
certificate(s) representing the Warrant Shares which are issuable upon exercise
of this Warrant shall be deemed to become the holder(s) of, and shall be treated
for all purposes as the record holder(s) of, such Warrant Shares, and such
Warrant Shares shall be deemed to have been issued, immediately prior to the
close of business on the date on which this Warrant and Notice of Exercise are
presented and payment made for such Warrant Shares, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such Warrant Shares shall not then be actually delivered to such
Person or Person(s). Certificates for the Warrant Shares so purchased shall be
delivered to the Holder within a reasonable time, not exceeding fifteen (15)
days after this Warrant is exercised. If this Warrant is exercised in part only,
the Company shall, upon surrender of this Warrant for cancellation, deliver a
new Warrant evidencing the rights

                                       4
<PAGE>   5
of the Holder to purchase the balance of the Warrant Shares which Holder is
entitled to purchase hereunder. The issuance of Warrant Shares upon exercise of
this Warrant shall be made without charge to the Holder for any issuance tax
with respect thereto or any other cost incurred by the Company in connection
with the exercise of this Warrant and the related issuance of Warrant Shares.

2.2 FRACTIONAL SHARES. The Company shall not issue fractional shares of Common
Stock or scrip representing fractional shares of Common Stock upon any exercise
or conversion of this Warrant. As to any fractional share of Common Stock which
the Holder would otherwise be entitled to purchase from the Company upon such
exercise or conversion, it shall become one share of the pertinent security
without payment of additional consideration by the Holder.

                                   ARTICLE III

                REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT

3.1 MAINTENANCE OF REGISTRATION BOOKS. The Company shall keep at the Principal
Executive Office a register in which, subject to such reasonable regulations as
it may prescribe, it shall provide for the registration, transfer and exchange
of this Warrant. The Company and any Company agent may treat the Person in whose
name this Warrant is registered as the owner of this Warrant for all purposes
whatsoever and neither the Company nor any Company agent shall be affected by
any notice to the contrary.

3.2   RESTRICTIONS ON TRANSFERS.

      (a) COMPLIANCE WITH SECURITIES ACT. Upon exercise of this Warrant, the
Holder shall confirm in writing, by executing the Investment Representation
Certificate in the form attached as EXHIBIT "B" hereto, that the Warrant Shares
are being acquired for investment, solely for the Holder's own account and not
as a nominee for any other Person, and not with a view toward distribution or
resale, and such other matters as set forth in the Investment Representation
Certificate.

      (b) CERTIFICATE LEGENDS. This Warrant, any warrant resulting from the
exercise, subdivision, consolidation or transfer hereof, and all Warrant Shares
issued upon exercise of this Warrant or any such other warrant (unless
Registered under the Securities Act) shall be stamped or imprinted with a legend
in substantially the following form (in addition to any legends required by
applicable state securities laws):

                  THE SECURITIES EVIDENCED BY AND UNDERLYING
                  THIS CERTIFICATE HAVE NOT BEEN REGISTERED
                  UNDER THE SECURITIES ACT OF 1933, AS AMENDED
                  OR ANY STATE SECURITIES LAW AND ACCORDINGLY
                  MAY NOT BE

                              5
<PAGE>   6
                  SOLD, OFFERED FOR SALE, PLEDGED OR
                  HYPOTHECATED, DIRECTLY OR INDIRECTLY IN THE
                  ABSENCE OF (i) AN EFFECTIVE REGISTRATION
                  STATEMENT RELATING THERETO, (ii) AN OPINION
                  OF COUNSEL FOR THE HOLDER, REASONABLY
                  SATISFACTORY TO THE COMPANY, THAT SUCH
                  REGISTRATION IS NOT REQUIRED, (iii) RECEIPT
                  OF A NO-ACTION LETTER FROM THE SECURITIES
                  AND EXCHANGE COMMISSION THAT SUCH
                  REGISTRATION IS NOT REQUIRED, (iv)
                  COMPLIANCE WITH REGULATION S UNDER THE
                  SECURITIES ACT OF 1933, OR (v) OTHERWISE
                  COMPLYING WITH THE PROVISIONS OF ARTICLE III
                  OF THIS WARRANT.

      (c) DISPOSITION OF WARRANT OR SHARES. With respect to any offer, sale or
other disposition of this Warrant or any Warrant Shares prior to Registration of
such shares, the Holder or the Shareholder, as the case may be, agrees to give
written notice to the Company prior thereto, describing briefly the manner
thereof, together with a written opinion of the Holder's or Shareholder's
counsel, if reasonably requested by the Company, to the effect that such offer,
sale or other disposition may be effected without Registration under the
Securities Act or qualification under any applicable state securities laws of
this Warrant or such shares, as the case may be, and indicating whether or not
under the Securities Act certificates for this Warrant or such shares, as the
case may be, to be sold or otherwise disposed of require any restrictive legend
as to applicable restrictions on transferability in order to insure compliance
with the Securities Act. Promptly upon receiving such written notice and
reasonably satisfactory opinion, if so requested, the Company, as promptly as
practicable, shall notify the Holder or the Shareholder, as the case may be, as
to whether it may sell or otherwise dispose of this Warrant or such shares, as
the case may be, all in accordance with the terms of the notice delivered to the
Company. If a determination has been made pursuant to this subsection (c) that
the opinion of counsel for the Holder or the Shareholder, as the case may be, is
not reasonably satisfactory to the Company, the Company shall so notify the
Holder or the Shareholder, as the case may be, promptly after such determination
has been made and shall specify the legal analysis supporting any such adverse
conclusion. Notwithstanding the foregoing, this Warrant or such shares, as the
case may be, may be offered, sold or otherwise disposed of in accordance with
Rule 144, provided that the Company shall have been furnished with such
information as the Company may reasonably request to provide reasonable
assurance that the provisions of Rule 144 have been satisfied. Each certificate
representing this Warrant or the shares thus transferred (except a transfer
pursuant to Rule 144) shall bear a legend as to the applicable restrictions on
transferability in order to insure compliance with the Securities Act, unless in
the aforesaid reasonably satisfactory opinion of counsel for the Holder or the
Shareholder, as the case may be, such legend is not necessary in order to insure
compliance with the Securities Act. The Company may issue stop transfer
instructions to its transfer agent in connection with such restrictions.

                                        6
<PAGE>   7
      (d) WARRANT TRANSFER PROCEDURE. Transfer of this Warrant to a third party,
following compliance with the preceding subsections of this Section 3.2, shall
be effected by execution of the Assignment Form attached hereto as EXHIBIT "C",
and surrender for registration of transfer of this Warrant at the Principal
Executive Office, together with funds sufficient to pay any applicable transfer
tax. Upon receipt of the duly executed Assignment Form and the necessary
transfer tax funds, if any, the Company, at its expense, shall execute and
deliver, in the name of the designated transferee or transferees, one or more
new Warrants representing the right to purchase a like aggregate number of
Warrant Shares.

      (e) TERMINATION OF RESTRICTIONS. Unless otherwise required by law, the
restrictions imposed under this Section 3.2 upon the transferability of the
Warrant and the Warrant Shares shall cease when (i) a registration statement
covering all shares of Common Stock issued or issuable upon exercise of this
Warrant becomes effective under the Securities Act, (ii) the Company is
presented with an opinion of counsel reasonably satisfactory to the Company that
such restrictions are no longer required in order to insure compliance with the
Securities Act or with a Commission "no-action" letter stating that future
transfers of such securities by the transferor or the contemplated transferee
would be exempt from registration under the Securities Act, or (iii) such
securities may be transferred in accordance with Rule 144(k). When such
restrictions terminate, the Company shall, or shall instruct its transfer agent
to, promptly, and without expense to the Holder or the Shareholder, as the case
may be, issue new securities in the name of the Holder and/or the Shareholder,
as the case may be, not bearing the legends required under subsection (b) of
this Section 3.2. In addition, new securities shall be issued without such
legends if such legends may be properly removed under the terms of Rule 144(k).

3.3 EXCHANGE. At the Holder's option, this Warrant may be exchanged for other
Warrants representing the right to purchase a like aggregate number of Warrant
Shares upon surrender of this Warrant at the Principal Executive Office.
Whenever this Warrant is so surrendered to the Company at the Principal
Executive Office for exchange, the Company shall execute and deliver the
Warrants which the Holder is entitled to receive. All Warrants issued upon any
registration of transfer or exchange of Warrants shall be the valid obligations
of the Company, evidencing the same rights, and entitled to the same benefits,
as the Warrants surrendered upon such registration of transfer or exchange. No
service charge shall be made for any exchange of this Warrant.

3.4 REPLACEMENT. Upon receipt of evidence reasonably satisfactory to the Company
of the loss, theft, destruction or mutilation of this Warrant and (i) in the
case of any such loss theft or destruction, upon delivery of indemnity
reasonably satisfactory to the Company in form and amount, or (ii) in the case
of any such mutilation, upon surrender of such Warrant for cancellation at the
Principal Executive Office, the Company, at its expense, shall execute and
deliver, in lieu thereof, a new Warrant.

                                       7
<PAGE>   8
                                   ARTICLE IV

                             ANTIDILUTION PROVISIONS

4.1   REORGANIZATION, RECLASSIFICATION OR RECAPITALIZATION OF THE COMPANY.

      (a) Subject to section 4.1(b), in the event of (1) a capital
reorganization, reclassification or recapitalization of the Company's capital
stock (other than in the cases referred to in Section 4.3 hereof), (2) the
Company's consolidation or merger with or into another corporation in which the
Company is not the surviving entity, or a reverse triangular merger in which the
Company is the surviving entity but the shares of the Company's capital stock
outstanding immediately prior to the merger are converted, by virtue of the
merger, into other property, whether in the form of securities, cash or
otherwise, or (3) the sale or transfer of the Company's property as an entirety
or substantially as an entirety, then, as part of such reorganization,
reclassification, recapitalization, merger, consolidation, sale or transfer,
lawful provision shall be made so that there shall thereafter be deliverable
upon the exercise of this Warrant or any portion thereof (in lieu of or in
addition to the number of shares of Common Stock theretofore deliverable, as
appropriate), and without payment of any additional consideration, the number of
shares of stock or other securities or property to which the holder of the
number of shares of Common Stock which would otherwise have been deliverable
upon the exercise of this Warrant or any portion thereof at the time of such
reorganization, reclassification, recapitalization, consolidation, merger, sale
or transfer would have been entitled to receive in such reorganization,
reclassification, recapitalization, consolidation, merger, sale or transfer.
This subsection 4.1(a) shall apply to successive reorganizations,
reclassifications, re-capitalizations, consolidations, mergers, sales and
transfers and to the stock or securities of any other corporation that are at
the time receivable upon the exercise of this Warrant. If the per-share
consideration payable to the Holder for shares of Common Stock in connection
with any transaction described in this subsection 4.1(a) is in a form other than
cash or marketable securities, then the value of such consideration shall be as
reasonably determined in good faith by the Company's Board of Directors.

      (b) If the Company undertakes a consolidation or merger with or into
another corporation, a reverse triangular merger or any other transaction or
series of related transactions pursuant to which all Shareholders (other than
George Wallner or Paul Wallner or any affiliates or associates thereof) receive
100% cash consideration for their shares of Common Stock, then at the option of
the Person acquiring all of such shares of Common Stock, the Holder shall
receive in connection with the completion of such transaction(s), without
exercise and upon surrender of this Warrant, cash in an amount equal to (a) the
per share acquisition price payable by the acquiring Person to the Shareholders
for their shares of Common Stock minus the Exercise Price determined as of the
date of completion of such transaction(s), multiplied by (b) the number of
Warrant Shares that are eligible for issuance under this Warrant on such date of
completion (which,

                                       8
<PAGE>   9
in the case of a series of related transactions, shall be the date of completion
of the final transaction in such series). Upon payment of such amount to the
Holder, this Warrant shall automatically expire and the rights hereunder (other
than as set forth in Section 5.4) shall be of no further force or effect.

4.2 SPLITS AND COMBINATIONS. If the Company at any time subdivides any of its
outstanding shares of Common Stock into a greater number of shares, the Exercise
Price in effect immediately prior to such subdivision shall be proportionately
reduced, and, conversely if the outstanding shares of Common Stock are combined
into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination shall be proportionately increased. Upon any adjustment of
the Exercise Price under this Section 4.2, the number of shares of Common Stock
issuable upon exercise of this Warrant shall equal the number of shares
determined by dividing (i) the aggregate Exercise Price payable for the purchase
of all shares issuable upon exercise of this Warrant immediately prior to such
adjustment by (ii) the Exercise Price per share in effect immediately after such
adjustment.

4.3 RECLASSIFICATIONS. If the Company changes any of the securities as to which
purchase rights under this Warrant exist into the same or a different number of
securities of any other class or classes, this Warrant shall thereafter
represent the right to acquire such number and kind of securities as would have
been issuable as the result of such change with respect to the securities that
were subject to the purchase rights under this Warrant immediately prior to such
reclassification or other change and the Exercise Price therefor shall be
appropriately adjusted.

4.4 LIQUIDATION; DISSOLUTION. If the Company shall dissolve, liquidate or wind
up its affairs, the Holder shall have the right, but not the obligation, to
exercise this Warrant effective as of the date of such dissolution, liquidation
or winding up. If any such dissolution, liquidation or winding up would result
in any cash distribution to the Holder in excess of the aggregate Exercise Price
for the shares of Common Stock for which this Warrant is exercised, then the
Holder may, at its option, exercise this Warrant without making payment of such
aggregate Exercise Price and, in such case, the Company shall, upon distribution
to the Holder, consider such aggregate Exercise Price to have been paid in full,
and in making such settlement to the Holder, shall deduct an amount equal to
such aggregate Exercise Price from the amount payable to the Holder.

4.5   CERTIFICATES AND NOTICES.

      (a) ADJUSTMENT CERTIFICATES. Upon any adjustment of the Exercise Price
and/or the number of shares of Common Stock purchasable upon exercise of this
Warrant, a certificate, signed by (i) the Company's President and Chief
Financial Officer, or (ii) any independent firm of certified public accountants
of recognized national standing the Company selects at its own expense, setting
forth in reasonable detail the events requiring the adjustment and the method by
which such adjustment was calculated, shall be mailed

                                       9
<PAGE>   10
to the Holder and shall specify the adjusted Exercise Price and the number of
shares of Common Stock purchasable upon exercise of the Warrant after giving
effect to the adjustment.

      (b) EXTRAORDINARY CORPORATE EVENTS. If the Company, after the date hereof,
proposes to effect (i) any transaction described in Sections 4.1 or 4.2 hereof,
(ii) a liquidation, dissolution or winding up of the Company described in
Section 4.3 hereof, or (iii) any payment of a dividend or distribution with
respect to Common Stock or Common Stock, then, in each such case, the Company
shall mail to the Holder a notice describing such proposed action and specifying
the date on which the Company's books shall close, or a record shall be taken,
for determining the holders of Common Stock entitled to participate in such
action, or the date on which such reorganization, reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding up
shall take place or commence, as the case may be, and the date as of which it is
expected that holders of Common Stock of record shall be entitled to receive
securities and/or other property deliverable upon such action, if any such date
is to be fixed. Such notice shall be mailed to the Holder at least ten (10) days
prior to the record date for such action in the case of any action described in
clause (i) or clause (iii) above, and in the case of any action described in
clause (ii) above, at least ten (10) days prior to the date on which the action
described is to take place and at least ten (10) days prior to the record date
for determining holders of Common Stock entitled to receive securities and/or
other property in connection with such action; provided, however, that the
failure by the Company to provide any such notice within the time prescribed
herein or otherwise in a timely manner shall have no effect on any of the
transactions contemplated herein.

4.6 NO IMPAIRMENT. The Company shall not, by amendment of the Certificate of
Incorporation or through any reorganization, recapitalization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or performance of
any of the terms to be observed or performed hereunder by the Company, but shall
at all times in good faith assist in the carrying out of all the provisions of
this Article IV and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the Holder against impairment.

                                    ARTICLE V

                               REGISTRATION RIGHTS

5.1 REGISTRATION. Within ninety (90) days after the Closing Date, the Company
shall prepare and file a registration statement under the Securities Act (the
"REGISTRATION STATEMENT") for the registration of (i) the Warrant Shares and,
(ii) at the Company's option, shares of Common Stock issued or issuable to other
security holders of the Company. The Company shall use commercially reasonable
efforts to cause the Registration Statement to become effective within one
hundred and eighty (180) days after the Closing Date.

                                       10
<PAGE>   11
5.2 HOLDER INFORMATION; REGISTRATION EXPENSES. The Holder shall promptly supply
the Company with all such information as the Company may reasonably request for
preparation of the Registration Statement and any amendments or supplements
thereto. All expenses incurred in connection with the preparation and filing of
the Registration Statement, including, without limitation, all federal and "blue
sky" registration and qualification fees, printers' and accounting fees, fees
and disbursements of counsel for the Company, and listing fees of any securities
exchange or automated trading or quotation system on which the Common Stock is
listed or traded, but excluding the Holder's legal fees and related
disbursements and brokers' discounts and commissions, shall be borne by the
Company.

5.3 REGISTRATION RELATED COVENANTS OF COMPANY. In connection with the
registration obligations of the Company provided in this Article V, the Company
hereby covenants that it shall:

      (a) provide to the Holder such number of copies as the Holder may
reasonably request of (i) the Registration Statement, (ii) each amendment and
supplement thereto, and (iii) the prospectus included therein, to facilitate the
Holder's disposition of the Warrant Shares contemplated by the Registration
Statement;

      (b) prepare and file with the Commission any amendment or supplement to
the Registration Statement or the prospectus included therein as may be
necessary to correct any statement or omission or to update any material
information therein (with due regard to the Company's potential need to maintain
in confidence undisclosed information relating to pending transactions or other
corporate matters);

      (c) use commercially reasonable efforts, once the Registration Statement
is declared effective, to keep the Registration Statement effective (subject to
subsection 5.3(d)) until the earlier of (i) the date on which all of the Warrant
Shares have been sold, and (ii) the date on which all of the Warrant Shares may
be immediately sold without restriction (including, without limitation, as to
volume by each holder thereof) without registration under the Securities Act;
provided, however, that in no event shall the Company be required to keep the
Registration Statement effective for longer than five (5) years after it is
first declared effective;

      (d) promptly notify the Holder of any period (a "DEFERRAL PERIOD") during
which the Holder must discontinue its use or dissemination of the prospectus
included in the Registration Statement (including by reason of the fact that
there is a material event or development involving the Company, that the Company
intends to effect a primary offering of securities, or that the information in
the prospectus needs to be amended or supplemented); provided, however, that the
Company shall use commercially reasonable efforts to ensure that (i) no Deferral
Period runs for more than 30 consecutive days, and

                                       11
<PAGE>   12
(ii) the aggregate number of days in all Deferral Periods does not exceed 60
days in any 12-month period; and

      (e) notify the Holder promptly after the Company receives notice of the
issuance of any stop order by the Commission suspending the effectiveness of the
Registration Statement, or the threat or initiation of any proceeding for such
purpose, and use commercially reasonable efforts to prevent the issuance of any
stop order or to obtain its withdrawal if such stop order should be issued.

5.4   INDEMNIFICATION.

      (a) BY THE COMPANY. With respect to the Registration Statement, to the
extent permitted by law, the Company will indemnify and hold harmless the
Holder, the legal counsel and accountants for the Holder and each Person, if
any, who controls the Holder within the meaning of the Securities Act or the
Exchange Act (collectively, the "HOLDER INDEMNIFIED PARTIES"), against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively a "VIOLATION"):

            (i) any untrue statement or alleged untrue statement of a material
      fact contained in the Registration Statement, including any preliminary
      prospectus or final prospectus contained therein or any amendments or
      supplements thereto;

            (ii) the omission or alleged omission to state therein a material
      fact required to be stated therein, or necessary to make the statements
      therein not misleading, or

            (iii) any violation or alleged violation by the Company of the
      Securities Act, the Exchange Act, any federal or state securities law or
      any rule or regulation promulgated under the Securities Act, the Exchange
      Act or any federal or state securities law in connection with the offering
      covered by the Registration Statement;

and the Company will reimburse such Holder Indemnified Parties for any legal or
other expenses reasonably incurred by them, as incurred, in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided however, that the indemnity agreement contained in this subsection
5.4(a) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of the Company (which consent shall not be unreasonably withheld), nor shall the
Company be liable in any such case for any such loss, claim, damage, liability
or action to the extent that it arises out of or is based upon a Violation which
(i) occurs in reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by any of such Holder
Indemnified

                                       12
<PAGE>   13
Parties, or (ii) arises out of the Holder's failure to satisfy prospectus
delivery or other distribution requirements in connection with such
registration.

      (b) BY THE HOLDER. With respect to the Registration Statement, to the
extent permitted by law, the Holder will indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the
Registration Statement, each Person, if any, who controls the Company within the
meaning of the Securities Act, legal counsel and accountants for the Company and
other shareholders of the Company against any losses, claims, damages or
liabilities (joint or several) to which the Company or any such director,
officer, controlling Person or other shareholder (collectively, the "COMPANY
INDEMNIFIED PARTIES") may become subject under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation (i) occurs in reliance upon and in conformity with written information
furnished by the Holder expressly for use in connection with such registration,
or (ii) arises out of the Holder's failure to satisfy prospectus delivery or
other distribution requirements in connection with such registration; and the
Holder will reimburse any legal or other expenses reasonably incurred by any
Company Indemnified Party in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this subsection 5.4(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder (which consent shall
not be unreasonably withheld); and provided further, that in no event shall the
Holder's cumulative, aggregate liability under this subsection 5.4(b) or under
subsection 5.4(d), or under such subsections together, exceed the net proceeds
received by the Holder in the registered offering out of which such Violation
arises.

      (c) NOTICE. Promptly after receipt by an indemnified party under this
Section 5.4 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 5.4, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if representation of
such indemnified party by the counsel retained by the indemnifying party would
be inappropriate due to actual or potential conflict of interests between such
indemnified party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action, if materially
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
5.4, but the omission so to deliver written notice to the

                                       13
<PAGE>   14
indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 5.4.

      (d) CONTRIBUTION. If the indemnification provided for in this Section 5.4
is held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage, or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission; provided, however, that (A) in no event shall the
Holder's cumulative, aggregate liability under subsection 5.4(b) or under this
subsection 5.4(d) hereof, or under such subsections together, exceed the net
proceeds from the offering received by such Holder; and (B) no Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. Notwithstanding anything to the
contrary herein, no party shall be liable for contribution under this subsection
5.4(d), except to the extent and under the circumstances as such party would
have been liable to indemnify under subsection 5.4(a) or subsection 5.4(b)
hereof, as the case may be, if such indemnification were enforceable under
applicable law.

      (e) SURVIVAL. The obligations of the Company and the Holder under this
Section 5.4 shall survive the completion of any offering of Warrant Shares under
the Registration Statement or otherwise.

5.5 RULE 144 REPORTING. With a view to making available to the Holder the
benefits of certain rules and regulations of the Commission which may at any
time permit the sale of the Warrant Shares to the public without registration,
after such time as a public market exists for the Common Stock, the Company
agrees to use commercially reasonable efforts to:

      (a) file with the Commission in a timely manner (after giving effect to
permitted extensions) all reports and other documents required of the Company
under the Securities Act and the Exchange Act (at any time after it has become
subject to such reporting requirements); and

      (b) so long as the Holder owns any Warrant Shares, furnish to the Holder

                                       14
<PAGE>   15
forthwith upon request (i) a written statement by the Company (A) as to its
compliance with the reporting requirements of said Rule 144 (at any time after
ninety (90) days after the effective date of the first registration statement
filed by the Company for an offering of its securities to the general public),
and of the Securities Act and the Exchange Act (for so long as it is subject to
the reporting requirements of the Exchange Act), or (B) that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any time
after it so qualifies after the date hereof), (ii) a copy of the most recent
annual or quarterly report of the Company, and (iii) such other reports and
documents of the Company and information as the Holder may reasonably request in
availing itself of any rule or regulation of the Commission allowing the Holder
to sell any such securities without registration or pursuant to Form S-3 (for so
long as the Company is subject to the reporting requirements of the Exchange
Act).

                                   ARTICLE VI

                   REPRESENTATIONS, WARRANTIES AND COVENANTS

6.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants that:

      (a) LEGAL STATUS; QUALIFICATION. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is qualified or licensed to do business in all other countries,
states and provinces in which the laws thereof require the Company to qualify
and/or be licensed, except where failure to qualify or be licensed would not
have a material adverse effect on the business or assets of the Company taken as
a whole;

      (b)   AUTHORITY.  The Company has the right and power, and is duly
authorized and empowered, to enter into, execute, deliver and perform this
Warrant;

      (c)   BINDING EFFECT.  This Warrant has been duly authorized, executed
and delivered and constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms;

      (d) NO CONFLICT. The execution, delivery and/or performance by the Company
of this Warrant shall not, by the lapse of time, the giving of notice or
otherwise, constitute a violation of any applicable law or a breach of any
provision contained in the Company's Certificate of Incorporation or By-laws or
contained in any agreement, instrument, or document to which the Company is a
party or by which it is bound;

      (e) CONSENTS. Except for filings required pursuant to applicable
securities laws, no consent, approval, authorization or other order of any
court, regulatory body, administrative agency or other governmental body is
required for the valid issuance of the Warrant or for the performance of any of
the Company's obligations hereunder;

                                       15
<PAGE>   16
      (f) OFFERING. Neither the Company nor any agent acting on its behalf has
or will sell or offer for sale or dispose of, or attempt or offer to dispose of,
this Warrant or any part thereof to, or solicit any offers to buy any warrant of
like tenor from, or otherwise approach or negotiate in respect thereof, with,
any Person or Persons so as thereby to bring the issuance of this Warrant within
the provisions of Section 5 of the Securities Act;

      (g) REGISTRATION. Subject to the Company's reliance on the truth and
accuracy of the Holder's representations and warranties in Section 6.2, it is
not necessary in connection with the issuance and sale of this Warrant to the
Holder to register this Warrant under the Securities Act; and

      (h) OVERALL REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company contained in this Warrant, and the other provisions of
this Warrant, do not contain any untrue statement of material fact or omit any
material fact necessary to make the statements contained herein, in view of the
circumstances under which they were made, not misleading.

6.2   REPRESENTATIONS AND WARRANTIES OF THE HOLDER.  The Holder represents
and warrants that:

      (a) PURCHASE FOR OWN ACCOUNT. This Warrant is, and the Warrant Shares to
be received by the Holder upon exercise hereof will be, acquired for investment
for the Holder's own account, not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and the Holder has no present
intention of selling, granting any participation in, or otherwise distributing
this Warrant, the Warrant Shares or any part thereof. The Holder does not have
any contract, undertaking, agreement or arrangement with any Person to sell,
transfer or grant participation to such Person with respect to this Warrant, the
Warrant Shares or any part thereof.

      (b) DISCLOSURE OF INFORMATION. The Holder is aware of the Company's
business affairs and financial condition, has received and reviewed all
information (including all reports, registrations and other documents) filed by
the Company with the Commission up to the date hereof) it considers necessary or
appropriate for making an informed and knowledgeable decision as to whether to
acquire this Warrant and further represents that it has had sufficient
opportunity to ask questions and receive answers from the Company regarding the
nature and affairs of the Company, including its business, properties, prospects
and financial condition.

      (c) INVESTMENT EXPERIENCE. The Holder is an investor in securities of
companies and acknowledges that it is capable of bearing the economic risk of
its investment in this Warrant and the Warrant Shares, including the risk of
total loss of any or all of such investments, and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of such investments.

                                       16
<PAGE>   17
      (d)   ACCREDITED INVESTOR.  The Holder is an "accredited investor"
within the meaning of Commission Rule 501 of Regulation D, as presently in
effect.

      (e) RESTRICTED SECURITIES. The Holder understands and hereby acknowledges
that (i) the Warrant Shares it may purchase pursuant to the provisions of this
Warrant may not initially be registered under the Securities Act, and in such
event will be issued in reliance upon a specific exemption from the registration
requirements under the Securities Act, which exemption depends upon, among other
things, the bona fide nature of the Holder's investment intent as expressed
herein, and (ii) the Warrant Shares must be held indefinitely unless
subsequently registered under the Securities Act or unless an exemption from
registration is otherwise available.

      (f) RULE 144 RESTRICTIONS. The Holder is aware of the provisions of Rule
144, promulgated under the Securities Act, which, in substance, permit limited
public resale of "restricted securities" acquired, directly or indirectly, from
the issuer thereof (or from an affiliate of such issuer), in a non-public
offering subject to the satisfaction of certain conditions, if applicable,
including, among other things: (i) the availability of certain public
information about the Company; (ii) the resale occurring not less than one (1)
year after the party has purchased and paid for the securities to be sold,
unless registered; (iii) the sale being made through a broker in an unsolicited
"broker's transaction" or in transactions directly with a market maker (as said
term is defined under the Exchange Act), (iv) the amount of securities being
sold during any three-month period not exceeding the specified limitations
stated therein, and (v) the filing of Form 144 with the Commission.

      (g) RULE 144 LIMITATIONS. The Holder understands and acknowledges that at
the time it wishes to sell some or all of the Warrant Shares there may not be an
active public market upon which to make such a sale, and that, even if such an
active public market upon which to make such a sale then exists, the Company may
not be satisfying the current public information requirements of Rule 144, and
that, in such event, the Holder may be precluded from selling the Warrant Shares
under Rule 144 even if the one-year minimum holding period had been satisfied or
the Warrant Shares registered. The Holder further understands that (i) if all of
the requirements of Rule 144 are not satisfied, registration under the
Securities Act, compliance with Regulation A or Regulation S under the
Securities Act or some other registration exemption will be required to permit
the Holder to sell the Warrant Shares, and (ii) notwithstanding the fact that
Rule 144 is not exclusive, the staff of the Commission has expressed its opinion
that Persons proposing to sell private placement securities other than in a
registered offering and other than pursuant to Rule 144 will have a substantial
burden of proof in establishing that an exemption from registration is available
for such offers or sales, and that such Persons and their respective brokers who
participate in such transactions do so at their own risk.

6.3   COMPANY'S COVENANTS.  The Company covenants as follows:

                                       17
<PAGE>   18
      (a) AUTHORIZED SHARES. The Company will use commercially reasonable
efforts to have, at all times, authorized, and reserved for the purpose of issue
or transfer upon exercise of the rights evidenced by this Warrant, a sufficient
number of shares of Common Stock to provide for the exercise of the rights
represented by this Warrant (for purposes of determining compliance with this
covenant, the shares of Common Stock issuable upon exercise of all other Options
shall be deemed issued and outstanding);

      (b) PROPER ISSUANCE. The Company and the Holder shall, at their respective
expenses, use commercially reasonable efforts to take all such action as may be
necessary to assure that the Common Stock issuable upon the exercise of this
Warrant may be so issued without violation of any applicable law or regulation,
or of any requirements of any domestic securities exchange upon which any
capital stock of the Company may be listed. In addition, the Company shall, at
its sole expense, upon the Holder's written request, use commercially reasonable
efforts to cause the Warrant Shares to be listed for trading on the New York
Stock Exchange or, if the Common Stock ceases to be traded on the New York Stock
Exchange, on such other national securities exchange, national market system or
over-the-counter market on which the Common Stock is listed or quoted for
trading.

      (c) FULLY PAID SHARES. The Company shall take all actions necessary or
appropriate to validly and legally issue fully paid and non-assessable shares of
Common Stock upon exercise of this Warrant.

                                   ARTICLE VII

                                  MISCELLANEOUS

7.1 CERTAIN EXPENSES. The Company shall pay all expenses in connection with, and
all taxes (other than stock transfer taxes) and other governmental charges that
may be imposed in respect of, the issuance, sale and delivery of the Warrant and
the Warrant Shares to the Holder.

7.2 HOLDER NOT A SHAREHOLDER. Prior to the exercise of this Warrant as
hereinbefore provided, the Holder shall not be entitled to any of the rights of
a shareholder of the Company including, without limitation, the right as a
shareholder (i) to vote on or consent to any proposed action of the Company or
(ii) to receive (a) dividends or any other distributions made to shareholders,
(b) notice of or attend any meetings of shareholders of the Company, or (c)
notice of any other proceedings of the Company.

7.3 REMEDIES. The Company stipulates that the remedies at law of the Holder in
the event of any default or threatened default by the Company in the performance
of or compliance with any of the terms of this Warrant are not and will not be
adequate to the fullest extent permitted by law, and that such terms may be
specifically enforced by a

                                       18
<PAGE>   19
decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise.

7.4 ENFORCEMENT COSTS. If any party to, or beneficiary of, this Warrant seeks to
enforce its rights hereunder by legal proceedings or otherwise, then the
non-prevailing party shall pay all reasonable costs and expenses incurred by the
prevailing party, including, without limitation, all reasonable attorneys' fees.
The term "PREVAILING PARTY" shall mean that party whose position is
substantially upheld in a final judgment rendered in such litigation or in a
final arbitration award, or if the final judgment or arbitration award is
appealed, that party whose final position is substantially upheld by the
decision of the final appellate body.

7.5 NONWAIVER; CUMULATIVE REMEDIES. No course of dealing or any delay or failure
to exercise any right hereunder on the part of the Holder shall operate as a
waiver of such right or otherwise prejudice the rights, powers or remedies of
the Holder. No single or partial waiver by the Holder of any provision of this
Warrant or of any breach or default hereunder or of any right or remedy shall
operate as a waiver of any other provision, breach, default right or remedy or
of the same provision, breach, default, right or remedy on a future occasion.
The rights and remedies provided in this Warrant are cumulative and are in
addition to all rights and remedies which the Holder may have in law or in
equity or by statute or otherwise.

7.6 NOTICES. Any notice, demand or delivery to be made pursuant to this Warrant
shall be deemed delivered and received (i) when personally delivered, (ii) on
the third Business Day next following the day when deposited in the U.S. mail,
postage prepaid, certified or registered mail, return receipt requested,
addressed as set forth below or (iii) on the first Business Day after proper and
timely deposit for next day delivery, charges prepaid, with a nationally
recognized delivery service providing next-day service to the location of the
recipient, to such party at the address set forth below. The Holder's address
shall be its last known addresses appearing on the books of the Company
maintained for such purpose. The Company's address shall be its Principal
Executive Office. The Holder and the Company may each designate a different
address by notice to the other pursuant to this Section 7.6.

7.7 ACTIONS ON NON-BUSINESS DAYS. If the last or appointed day for the taking of
any action or the expiration of any right required or granted herein shall be a
day that is not a Business Day, then such action may be taken or such right may
be exercised on the next succeeding Business Day.

7.8 SUCCESSORS AND ASSIGNS. Subject to subsection 4.1(b), this Warrant shall be
binding upon, the Company and any Person succeeding the Company by merger,
consolidation or acquisition of all or substantially all of the Company's
assets, and all of the obligations of the Company with respect to the shares of
Common Stock issuable upon exercise of this Warrant shall survive the exercise,
expiration or termination of this Warrant and all of the covenants and
agreements of the Company shall inure to the benefit of the

                                       19
<PAGE>   20
Holder and its successors and assigns. The Company shall, at the time of
exercise of this Warrant, in whole or in part, upon request of the Holder but at
the Company's expense, acknowledge in writing its continuing obligations
hereunder with respect to rights of the Holder to which it shall continue to be
entitled after such exercise in accordance with the terms hereof; provided that
the failure of the Holder to make any such request shall not affect the
continuing obligation of the Company to the Holder in respect of such rights.

7.9   MODIFICATION; SEVERABILITY.

      (a) If, in any action before any court or agency legally empowered to
enforce any term, any term is found to be unenforceable, then such term shall be
deemed modified to the extent necessary to make it enforceable by such court or
agency.

      (b) If any term is not curable as set forth in subsection (a) above, the
unenforceability of such term shall not affect the other provisions of this
Warrant but this Warrant shall be construed as if such unenforceable term had
never been contained herein.

7.10 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company and the Holder in this Warrant shall survive the
execution and delivery of this Warrant and the consummation of the transactions
contemplated hereby, notwithstanding any investigation by the Holder or its
agents.

7.11  AMENDMENT.  This Warrant may not be modified or amended except by
written agreement of the Company and  the Holder.

7.12 HEADINGS. The headings of the Articles and Sections of this Warrant are for
the convenience of reference only and shall not, for any purpose, be deemed a
part of this Warrant.

7.13 MEANINGS. Whenever used in this Warrant, any noun or pronoun shall be
deemed to include both the singular and plural and to cover all genders; and the
words "herein," "hereof" and "hereunder" and words of similar import shall refer
to this instrument as a whole, including any amendments hereto.

7.14  GOVERNING LAW.  This Warrant shall be governed by, and construed in
accordance with, the laws of the State of Delaware.

                                       20
<PAGE>   21
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
duly authorized officer as of June 4, 2001.

                                     HYPERCOM  CORPORATION

                                    By:
                                        --------------------------------------
                                          Christopher S. Alexander,
                                          Chief Executive Officer

                                       21
<PAGE>   22
                              SCHEDULE OF EXHIBITS

EXHIBIT "A"       Notice of Exercise (Section 2.1)

EXHIBIT "B"       Investment Representation Certificate (Subsection 3.2(a))

EXHIBIT "C"       Assignment Form (Subsection 3.2(d))
<PAGE>   23
                                   EXHIBIT "A"
                             NOTICE OF EXERCISE FORM

    (To be executed only upon partial or full exercise of the within Warrant)

      The undersigned registered Holder of the within Warrant hereby irrevocably
exercises the within Warrant for and purchases shares of Common Stock of
Hypercom Corporation and herewith makes payment therefor in the amount of
$_________, all at the price and on the terms and conditions specified in the
within Warrant and requests that a certificate (or _____ certificates in
denominations of shares) for the shares of Common Stock of Hypercom Corporation
hereby purchased be issued in the name of and delivered to (choose one) (a) the
undersigned or (b) [NAME]___________, whose address is ________________________
and, if such shares of Common Stock shall not include all the shares of Common
Stock issuable as provided in the within Warrant, that a new Warrant of like
tenor for the number of shares of Common Stock of Hypercom Corporation not being
purchased hereunder be issued in the name of and delivered to (choose one) (a)
the undersigned or (b) [NAME]__________________, whose address is______________
_________________________________________________.

      The undersigned herewith makes payment for the shares of Common Stock of
Hypercom Corporation as follows:

            (i)   in cash (ie., check or wire transfer) in the sum of
            $_______________________ , and/or

            (ii) ___ by forgiveness of debt under the Promissory Note
            (including principal and interest) in the sum of $________________.

Dated: ____________________________

Signature Guaranteed

                                          By:__________________________________
                                              (Signature of Registered Holder)

                                          Title:_______________________________

NOTICE: The signature to this Notice of Exercise must correspond with the name
as written upon the face of the within Warrant in every particular, without
alteration or enlargement or any change whatever.
<PAGE>   24
                                   EXHIBIT "B"

                      INVESTMENT REPRESENTATION CERTIFICATE

Purchaser: __________________________

Company:  Hypercom Corporation (the "Company")
Security:  Common Stock
Amount: _________________________
Date:_____________________

In connection with the purchase of the above-listed shares of Common Stock (the
"Warrant Shares"), the undersigned (the "Purchaser") hereby represents to the
Company as follows:

      (a) PURCHASE FOR OWN ACCOUNT. The Warrant Shares are being acquired for
investment for the Purchaser's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and the Purchaser
has no present intention of selling, granting any participation in, or otherwise
distributing the Warrant Shares or any part thereof. The Purchaser does not have
any contract, undertaking, agreement or arrangement with any Person to sell,
transfer or grant participation to such Person with respect to the Warrant
Shares or any part thereof.

      (b) DISCLOSURE OF INFORMATION. The Purchaser is aware of the Company's
business affairs and financial condition, has received and reviewed all
information (including all reports, registrations and other documents) filed by
the Company with the United States Securities and Exchange Commission (the
"Commission") up to the date hereof) it considers necessary or appropriate for
making an informed and knowledgeable decision as to whether to acquire this
Warrant and further represents that it has had sufficient opportunity to ask
questions and receive answers from the Company regarding the nature and affairs
of the Company, including its business, properties, prospects and financial
condition.

      (c) INVESTMENT EXPERIENCE. The Purchaser is an investor in securities of
companies and acknowledges that it is capable of bearing the economic risk of
its investment in the Warrant Shares, including the risk of total loss of such
investment, and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of such
investment.

      (d)  ACCREDITED INVESTOR.  The Purchaser is an "accredited investor"
within the meaning of Commission Rule 501 of Regulation D, as presently in
effect.

      (e) RESTRICTED SECURITIES. The Purchaser understands and hereby
acknowledges that (i) the Warrant Shares may not initially be registered under
the
<PAGE>   25
Securities Act, and in such event will be issued in reliance upon a specific
exemption from the registration requirements under the Securities Act, which
exemption depends upon, among other things, the bona fide nature of the
Purchaser's investment intent as expressed herein, and (ii) the Warrant Shares
must be held indefinitely unless subsequently registered under the Securities
Act or unless an exemption from registration is otherwise available.

      (f) RULE 144 RESTRICTIONS. The Purchaser is aware of the provisions of
Rule 144, promulgated under the Securities Act, which, in substance, permit
limited public resale of "restricted securities" acquired, directly or
indirectly, from the issuer thereof (or from an affiliate of such issuer), in a
non-public offering subject to the satisfaction of certain conditions, if
applicable, including, among other things: (i) the availability of certain
public information about the Company; (ii) the resale occurring not less than
one (1) year after the party has purchased and paid for the securities to be
sold, unless registered; (iii) the sale being made through a broker in an
unsolicited "broker's transaction" or in transactions directly with a market
maker (as said term is defined under the Exchange Act), (iv) the amount of
securities being sold during any three-month period not exceeding the specified
limitations stated therein, and (v) the filing of Form 144 with the Commission.

      (g) RULE 144 LIMITATIONS. The Purchaser understands and acknowledges that
at the time it wishes to sell some or all of the Warrant Shares there may not be
an active public market upon which to make such a sale, and that, even if such
an active public market upon which to make such a sale then exists, the Company
may not be satisfying the current public information requirements of Rule 144,
and that, in such event, the Purchaser may be precluded from selling the Warrant
Shares under Rule 144 even if the one-year minimum holding period had been
satisfied or the Warrant Shares registered. The Purchaser further understands
that (i) if all of the requirements of Rule 144 are not satisfied, registration
under the Securities Act, compliance with Regulation A or Regulation S under the
Securities Act or some other registration exemption will be required to permit
the Purchaser to sell the Warrant Shares, and (ii) notwithstanding the fact that
Rule 144 is not exclusive, the staff of the Commission has expressed its opinion
that persons proposing to sell private placement securities other than in a
registered offering and other than pursuant to Rule 144 will have a substantial
burden of proof in establishing that an exemption from registration is available
for such offers or sales, and that such persons and their respective brokers who
participate in such transactions do so at their own risk.

Date: _______________________ , 20___        PURCHASER:

                                             __________________________________

                                       3
<PAGE>   26
                                   EXHIBIT "C"

                                 ASSIGNMENT FORM

         (To be executed only upon the assignment of the within Warrant)

      FOR VALUE RECEIVED, the undersigned registered holder of the within
Warrant hereby sells, assigns and transfers unto , whose address is all of the
rights of the undersigned under the within Warrant, with respect to shares of
Common Stock of Hypercom Corporation and, if such shares of Common Stock shall
not include all the shares of Common Stock issuable as provided in the within
Warrant, that a new Warrant of like tenor for the number of shares of Common
Stock of Hypercom Corporation not being transferred hereunder be issued in the
name of and delivered to the undersigned, and does hereby irrevocably constitute
and appoint ___________________________________________ attorney to register
such transfer on the books of Hypercom Corporation maintained for the purpose,
with full power of substitution in the premises.

Dated: ___________

Signature Guaranteed

                                          By:__________________________________
                                              (Signature of Registered Holder)

                                          Title:_______________________________

NOTICE:     The signature to this Assignment must correspond with the name
upon the face of the within Warrant in every particular, without alteration
or enlargement or any change whatever.

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