Hypercom Confidential

Page 9 of 9

Smith rejected the offer. On September 23, 1998, George Wallner signed a letter authorizing the same deal, except he dropped the offer to $100,000 instead of $120,000.

Wallner gave Smith less than a day to sign. Again, she didn't. That marked the end of settlement negotiations.

Smith later hired Larry Debus, a noted criminal-defense attorney now trying his hand in the civil arena, to represent her. He and co-counsel Jerry Busby have been doing battle against Snell & Wilmer's team of attorneys, led by Lonnie Williams. (As named defendants, John Murphy and Jairo Gonzalez have their own attorneys.)

Despite his dubious behavior toward Smith, John Murphy seems to be doing well at Hypercom. Around the time he was courting Smith in late 1997, the firm promoted Murphy to a newly created position of senior vice president of Human Resources and Administration. That's his job today.

Jairo Gonzalez's star at Hypercom may be on the wane. He didn't run for reelection to the board of directors. The official explanation in Hypercom's notice of its annual meeting -- which was to have been held Tuesday, November 16, at the Embassy Suites-Biltmore: "He felt he needed to devote his fulltime efforts to his current job responsibilities with Hypercom."

On July 1, Gonzalez became Hypercom's managing director of global sales and marketing. Industry sources say the new position is a demotion from his previous position as president of the international division.

Hypercom fired Colleen Smith earlier this year, after alleging she'd stolen a computer terminal from them. (The facts surrounding the alleged theft are controverted.)

Smith says she's still occasionally plagued by depression, but feels better about herself than she has in a long time. She gives her children and her new husband -- Rick Smith, the airline pilot -- much of the credit.

"I didn't ask for any of this, believe me," she says, "and I'm not happy it happened. But now that I've read the paperwork, and sat in court, and heard their crap, you know something? I think Hypercom and Jairo Gonzalez deserve each other."

Contact Paul Rubin at his online address: [email protected]

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Paul Rubin
Contact: Paul Rubin