Hypercom Corporation Annual Report - CiteSeer

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Report of Independent Registered Public Accounting Firm The Board of Directors and Stockholders of Hypercom Corporation We have audited Hypercom Corporation’s internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Hypercom Corporation’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, Hypercom Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on the COSO criteria . We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Hypercom Corporation as of December 31, 2009 and 2008, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2009 of Hypercom Corporation, and our report dated March 12, 2010 expressed an unqualified opinion thereon. Phoenix, Arizona March 12, 2010 /s/ Ernst & Young LLP - 45 -
Item 9B. Other Information None. PART III Item 10. Directors, Executive Officers and Corporate Governance Executive Officers of the Registrant The following are our executive officers as of March 9, 2010: Name Age Title Other Business Experience since 1/1/2005 Philippe Tartavull 52 Chief Executive Officer and Director, Hypercom Corporation (since December President (since December 2007) 2007 and April 2006 – January 2007); President and Chief Operating Officer, Hypercom Corporation; President, Oberthur Card Systems, USA Thomas B. Sabol 51 Henry Gaillard Scott Tsujita Douglas J. Reich 49 46 66 Chief Financial Officer (since April 2009) Senior Vice President, Global Operations (since April 2008) Senior Vice President, Finance, Treasury and Investor Relations (since October 2003) Senior Vice President, General Counsel, Chief Compliance Officer and Secretary (since November 2001) - 46 - Chief Financial Officer, Suntron Corporation; Chief Financial Officer, Wolverine Tube Corporation Chief Operating Officer, Thales e-Transactions, a division of the Thales Group; Chief Executive Officer, Thales Navigation (Magellan); Chief Operating Officer and General Manager of the Consumer Business Unit, Thales Navigation (Magellan) The additional information required by this item regarding our directors, audit committee and compliance with Section 16 of the Exchange Act is incorporated by reference from the information contained in our 2010 Annual Meeting Proxy Statement, which will be filed with the SEC within 120 days following our fiscal year end. We have adopted a code of ethics that applies to all directors, officers and employees of our company, including our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, or persons performing similar functions. A copy of our Code of Ethics is available on our website at www.hypercom.com . We intend to satisfy the disclosure requirements under Item 10 of Form 8-K in the event of an amendment to, or a waiver from, a provision of our Code of Ethics that applies to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, or persons performing similar functions, by disclosing such information on our website. Item 11. Executive Compensation Information required in response to this item is incorporated by reference to our 2010 Annual Meeting Proxy Statement, which will be filed with the SEC within 120 days following our fiscal year end. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information required in response to this item is incorporated by reference from our 2010 Annual Meeting Proxy Statement, which will be filed with the SEC within 120 days following our fiscal year end.
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Hypercom Corporation Annual Report
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i. to our StoCkhoLderS, CuStomerS,
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iii. 2009 highLightS January - Febr
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v. iphone SeCure paymentS SoLutionS
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vii. SmartpaymentS wynid Server-baS
Page 12 and 13: iX. hyperCom Corporation End-to-End
Page 14 and 15: (This Page Left Blank Intentionally
Page 16 and 17: Yes � No � Indicate by check ma
Page 18 and 19: CAUTIONARY STATEMENT REGARDING FORW
Page 20 and 21: On April 1, 2008, we acquired all o
Page 22 and 23: solution against payment card fraud
Page 24 and 25: aggressively transitioning into the
Page 26 and 27: Trusted Transaction Services — Ou
Page 28 and 29: and biometric authentication and en
Page 30 and 31: Proprietary Rights We rely upon pat
Page 32 and 33: • the type, timing and size of or
Page 34 and 35: affecting our business. However, if
Page 36 and 37: Furthermore, we utilize contract ma
Page 38 and 39: economic climate, the credit market
Page 40 and 41: Our failure to properly comply with
Page 42 and 43: espect of the related indebtedness.
Page 44 and 45: Lisa Shipley v. Hypercom Corporatio
Page 46 and 47: (e) In September 2006, we completed
Page 48 and 49: of our stock grants and only recogn
Page 50 and 51: In 2009, we incurred employee sever
Page 52 and 53: Costs of Revenue and Gross Profit C
Page 54 and 55: Net Revenues Net revenues increased
Page 56 and 57: Our products revenues relate primar
Page 58 and 59: Changes in operating assets and lia
Page 60 and 61: significantly impacted by a 100 bas
Page 64 and 65: Item 13. Certain Relationships and
Page 66 and 67: REPORT OF INDEPENDENT REGISTERED PU
Page 68 and 69: HYPERCOM CORPORATION CONSOLIDATED S
Page 70 and 71: HYPERCOM CORPORATION CONSOLIDATED S
Page 72 and 73: Allowance for Doubtful Accounts Pay
Page 74 and 75: Revenue Recognition Revenue is reco
Page 76 and 77: The Company does not provide for fe
Page 78 and 79: The purchase price consisted of the
Page 80 and 81: and assuming no subsequent impairme
Page 82 and 83: Of the $2.9 million of costs incurr
Page 84 and 85: 7. Leases Sales-Type Leases The Com
Page 86 and 87: 12. Product Warranty Liability The
Page 88 and 89: Long-term debt, which approximates
Page 90 and 91: the issuance of non-qualified stock
Page 92 and 93: 17. Income Taxes Loss before income
Page 94 and 95: enefit obligations as of December 3
Page 96 and 97: In determining the asset allocation
Page 98 and 99: The Company’s cash and cash equiv
Page 100 and 101: The Company’s depreciation and am
Page 102 and 103: First Second Third Fourth Fiscal Qu
Page 104 and 105: EXHIBIT INDEX Exhibit Number Descri
Page 106 and 107: Exhibit Number Description of Exhib
Page 108 and 109: I, Thomas B. Sabol, certify that: C
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NOTES HYPERCOM CORPORATION
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Xi. StoCk perFormanCe Chart The fol
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World Headquarters: hypercom Corpor
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