SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C.  20549
                    __________________________________

                                FORM 10-Q

(Mark One)

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2000

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________.

                        Commission file number 1-8729

                             UNISYS CORPORATION
            (Exact name of registrant as specified in its charter)

               Delaware                            38-0387840
       (State or other jurisdiction             (I.R.S. Employer
       of incorporation or organization)        Identification No.)

               Unisys Way
        Blue Bell, Pennsylvania                          19424
       (Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code:  (215) 986-4011

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
registrant was required to file such reports), and (2) has been subject 
to such filing requirements for the past 90 days.  YES [X]    NO [ ]

     Number of shares of Common Stock outstanding as of September 30, 2000:
314,135,593.



<PAGE> 2

Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

<TABLE>
                             UNISYS CORPORATION
                    CONSOLIDATED BALANCE SHEET (UNAUDITED)
                                (Millions)
<CAPTION>   
                                          
                                          September 30, December 31,
                                            2000          1999
                                         -----------   ------------
<S>                                      <C>            <C>
Assets
------
Current assets
Cash and cash equivalents                 $  234.9       $  464.0
Accounts and notes receivable, net         1,386.9        1,430.5
Inventories
   Parts and finished equipment              241.5          236.8
   Work in process and materials             177.6          136.1
Deferred income taxes                        482.3          472.7
Other current assets                          94.8          105.6
                                          --------       --------
Total                                      2,618.0        2,845.7
                                          --------       --------

Properties                                 1,612.0        1,723.0
Less-Accumulated depreciation                996.1        1,102.2
                                          --------       --------
Properties, net                              615.9          620.8
                                          --------       --------
Investments at equity                        224.5          225.5
Software, net of accumulated amortization    283.2          259.8
Prepaid pension cost                       1,080.8          975.9
Deferred income taxes                        655.6          655.6
Other assets                                 366.5          306.4
                                          --------       --------
Total                                     $5,844.5       $5,889.7
                                          ========       ========
Liabilities and stockholders' equity
------------------------------------
Current liabilities
Notes payable                             $  472.3       $   26.9

Current maturities of long-term debt          18.7           22.9
Accounts payable                             990.5        1,036.7
Other accrued liabilities                    965.6        1,183.1
Estimated income taxes                       359.5          348.9
                                          --------       --------
Total                                      2,806.6        2,618.5             
                                          --------       --------
Long-term debt                               535.9          950.2
Other liabilities                            331.0          367.7

Stockholders' equity
Common stock, issued: 2000,316.0;
   1999,312.5                                  3.2            3.1
Accumulated deficit                         (868.4)      (1,054.4)
Other capital                              3,641.8        3,575.0
Accumulated other comprehensive
   loss                                     (605.6)        (570.4)
                                          --------       --------
Stockholders' equity                       2,171.0        1,953.3
                                          --------       --------
Total                                     $5,844.5       $5,889.7
                                          ========       ========
 </TABLE>

See notes to consolidated financial statements.





<PAGE> 3

<TABLE>
                              UNISYS CORPORATION
                CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
                     (Millions, except per share data)

<CAPTION>
 
                                        Three Months           Nine Months
                                     Ended September 30     Ended September 30
                                     -----------------      ------------------
                                       2000      1999         2000      1999
                                     --------  --------     --------  --------
<S>                                  <C>       <C>          <C>       <C>
Revenue                              $1,690.9  $1,865.4     $4,956.7  $5,584.7
                                     --------  --------     --------  --------
Costs and expenses
  Cost of revenue                     1,216.2   1,195.2      3,461.9   3,581.8
  Selling, general and
    administrative                      320.1     354.8        924.1   1,034.9
  Research and development expenses      77.5      86.2        237.8     251.4 
                                     --------  --------     --------  --------
                                      1,613.8   1,636.2      4,623.8   4,868.1
                                     --------  --------     --------  --------
Operating income                         77.1     229.2        332.9     716.6

Interest expense                         18.5      34.1         57.7     103.0
Other income (expense), net               6.4       1.0         36.5     (65.3)
                                     --------  --------     --------  --------
Income before income taxes               65.0     196.1        311.7     548.3
Estimated income taxes                   22.1      45.6        106.0     169.9
                                     --------  --------     --------  --------
Income before extraordinary items        42.9     150.5        205.7     378.4
Extraordinary items                               (12.1)       (19.8)    (12.1)
                                     --------  --------     --------  --------
Net income                               42.9     138.4        185.9     366.3

Dividends on preferred shares                       1.9                   36.7
                                     --------  --------     --------  --------
Earnings on common shares            $   42.9  $  136.5     $  185.9  $  329.6
                                     ========  ========     ========  ========

Earnings per common share
  Basic                              
    Before extraordinary items       $    .14  $    .49     $    .66  $   1.22
    Extraordinary items                            (.04)        (.06)     (.04)
                                     --------  --------     --------  --------
     Total                           $    .14  $    .45     $    .60  $   1.18
                                     ========  ========     ========  ========

  Diluted
    Before extraordinary items       $    .14  $    .47     $    .65  $   1.17
    Extraordinary items                            (.04)        (.06)     (.04)
                                     --------  --------     --------  --------
     Total                           $    .14  $    .43     $    .59  $   1.13
                                     ========  ========     ========  ========    

</TABLE>




See notes to consolidated financial statements.

                                                






<PAGE> 4

<TABLE>
                           UNISYS CORPORATION
               CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
                                (Millions)
<CAPTION>
                                                    Nine Months Ended
                                                       September 30
                                                    -----------------
                                                      2000       1999
                                                    --------   -------
<S>                                                 <C>       <C>
Cash flows from operating activities
Income before extraordinary items                   $ 205.7   $  378.4
Add(deduct) items to reconcile income before
   extraordinary items to net cash (used for) 
   provided by operating activities:
Extraordinary items                                   (19.8)     (12.1)
Depreciation                                          109.4      105.3
Amortization:   
   Marketable software                                 90.2       83.6
   Goodwill                                             7.7       10.2
(Increase) in deferred income taxes, net               (9.6)    ( 70.3) 
Decrease (increase) in receivables, net                 8.4     ( 47.1)
(Increase) decrease in inventories                    (46.2)      64.4
(Decrease) in accounts payable and
   other accrued liabilities                         (335.6)    (224.0)
Increase in estimated income taxes                     10.5       68.1
(Decrease) in other liabilities                        (3.4)    ( 16.2)
(Increase) in other assets                           (110.6)    ( 94.4)
Other                                                  20.6       74.2
                                                    -------    -------
Net cash (used for) provided by operating
 activities                                           (72.7)     320.1
                                                    -------    -------
Cash flows from investing activities
   Proceeds from investments                          525.1      803.6
   Purchases of investments                          (454.0)    (778.2)
   Proceeds from sales of properties                   17.0       21.7
   Investment in marketable software                 (113.6)    ( 83.7)
   Capital additions of properties                   (143.2)    (139.0)
   Purchases of businesses                            (13.9)    ( 53.9)
                                                    -------    -------
Net cash used for investing activities               (182.6)    (229.5) 
                                                    -------    -------
Cash flows from financing activities
   Redemption of preferred stock                                (197.0)
   Proceeds from issuance of long-term debt                       30.3
   Payments of long-term debt                        (447.2)    (161.5)            
   Net proceeds from (reduction in) 
    short-term borrowings                             442.5     (  9.1)
   Dividends paid on preferred shares                           ( 59.4)
   Proceeds from employee stock plans                  42.5       74.4
                                                    -------    -------
Net cash provided by (used for) financing
   activities                                          37.8     (322.3)
                                                    -------    -------
Effect of exchange rate changes on
   cash and cash equivalents                          (11.6)    ( 10.7)
                                                    -------    -------

(Decrease) in cash and cash equivalents              (229.1)    (242.4)
Cash and cash equivalents, beginning of period        464.0      616.4
                                                    -------    -------
Cash and cash equivalents, end of period            $ 234.9    $ 374.0
                                                    =======    =======
</TABLE>

See notes to consolidated financial statements.
                                               



<PAGE> 5

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In the opinion of management, the financial information furnished
herein reflects all adjustments necessary for a fair presentation of
the financial position, results of operations and cash flows for the
interim periods specified.  These adjustments consist only of normal
recurring accruals.  Because of seasonal and other factors, results
for interim periods are not necessarily indicative of the results to
be expected for the full year.

a.   The shares used in the computations of earnings per share are as
     follows (in thousands):

                         Three Months Ended     Nine Months Ended   
                             September 30         September 30
                         ------------------     ----------------- 
                           2000       1999        2000     1999
                         -------    -------     -------   -------
          Basic          313,744    302,183     312,473   279,678    
          Diluted        315,516    314,541     316,539   292,733    

b.   A summary of the company's operations by business segment for the
     three and nine month periods ended September 30, 2000 and 1999 is 
     presented below(in millions of dollars):

                                Total    Corporate    Services    Technology
     Three Months Ended         -----    ---------    --------    ----------
     September 30, 2000
     ------------------
     Customer revenue          $1,690.9               $1,200.2      $  490.7
     Intersegment                         $( 92.8)        10.6          82.2
                               --------   -------     --------      --------
     Total revenue             $1,690.9   $( 92.8)    $1,210.8      $  572.9
                               ========   =======     ========      ========
     Operating income(loss)    $   77.1   $   2.8     $   18.1      $   56.2
                               ========   =======     ========      ========

     Three Months Ended  
     September 30, 1999
     ------------------
     Customer revenue          $1,865.4               $1,318.5      $  546.9
     Intersegment                         $(151.7)        17.7         134.0
                               --------   -------     --------      --------
     Total revenue             $1,865.4   $(151.7)    $1,336.2      $  680.9
                               ========   =======     ========      ========
     Operating income(loss)    $  229.2   $( 13.5)    $  104.9      $  137.8
                               ========   =======     ========      ========

     Nine Months Ended
     September 30, 2000
     ----------------
     Customer revenue          $4,956.7               $3,454.1      $1,502.6
     Intersegment                         $(326.7)        35.2         291.5
                               --------   -------     --------      --------
     Total revenue             $4,956.7   $(326.7)    $3,489.3      $1,794.1
                               ========   =======     ========      ========
     Operating income(loss)    $  332.9   $  20.4     $   37.5      $  275.0
                               ========   =======     ========      ========
                            
     Nine Months Ended  
     September 30, 1999
     ------------------
     Customer revenue          $5,584.7               $3,901.3      $1,683.4
     Intersegment                         $(415.6)        49.0         366.6
                               --------   -------     --------      --------
     Total revenue             $5,584.7   $(415.6)    $3,950.3      $2,050.0
                               ========   =======     ========      ========
     Operating income(loss)    $  716.6   $( 21.6)    $  288.7      $  449.5
                               ========   =======     ========      ========

<PAGE> 6
Notes to Consolidated Financial Statements (cont'd)


Presented below is a reconciliation of total business segment operating
income to consolidated income before taxes (in millions of dollars):

                                             Three Months      Nine Months
                                                Ended            Ended
                                             September 30     September 30
                                            ---------------   -------------
                                             2000     1999     2000    1999
                                            ------   ------   ------  ------
     Total segment operating income         $ 74.3   $242.7   $312.5  $738.2
     Interest expense                        (18.5)  ( 34.1)   (57.7) (103.0)
     Other income (expense), net               6.4      1.0     36.5  ( 65.3)
     Corporate and eliminations                2.8   ( 13.5)    20.4  ( 21.6)
                                            ------   ------   ------  ------
     Total income before income taxes       $ 65.0   $196.1   $311.7  $548.3
                                            ======   ======   ======  ======

c.   Comprehensive income for the three and nine months ended September 30, 2000
     and 1999 includes the following components (in millions of dollars):

                                         Three Months       Nine Months
                                        Ended Sept 30      Ended Sept 30
                                       ---------------     -------------
                                        2000     1999      2000    1999
                                       ------   ------    ------  ------
     Net income                        $ 42.9   $138.4    $185.9  $366.3
     Other comprehensive
       income (loss)
        Foreign currency
         translation adjustment           2.0   ( 19.9)    (21.5) ( 63.0)
        Related tax expense
         (benefit)                        5.1      1.0      13.7     1.5
                                       ------   ------    ------  ------
     Total other comprehensive
       income (loss)                     (3.1)  ( 20.9)    (35.2) ( 64.5)
                                       ------   ------    ------  ------
     Comprehensive income              $ 39.8   $117.5    $150.7  $301.8
                                       ======   ======    ======  ======


     Accumulated other comprehensive income (loss), all of which 
     relates to foreign currency translation adjustments, as of 
     September 30,2000 and December 31, 1999 is as follows (in millions of
     dollars):

                                         September 30,     December 31,
                                             2000               1999
                                        ----------------    -----------
     
     Balance at beginning of period       $(570.4)            $(531.6)
     Translation adjustments               ( 35.2)             ( 38.8)
                                          -------             -------
     Balance at end of period             $(605.6)            $(570.4) 
                                          =======             =======

d.   The amount credited to stockholders' equity for the income tax benefit
     related to the company's stock plans for the nine months ended September
     30, 2000 and 1999 was $10.5 million and $53.8 million, respectively.  The 
     company expects to realize these tax benefits on future Federal
     income tax returns.



<PAGE> 7


I
tem 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations.

Overview
------------

The company is continuing to transition its business to meet the new 
requirements of the e-business marketplace.  During the third quarter, the 
company completed a strategic business review aimed at focusing the company 
on higher-growth, higher-margin e-business opportunities and improving its 
financial performance.  As a result of this review, the company plans to 
implement a series of actions during the fourth quarter of 2000 designed to 
build its revenue base in new high-growth markets; focus its research and 
development resources on high-potential new markets; de-emphasize non-
strategic, low-growth and low-margin businesses and products; and reduce its 
cost structure in line with its new, more focused business model.  In 
particular, the company plans to:

*    Streamline its portfolio of industry-specific repeatable solutions from 
more than 30 programs currently to approximately 15 strategic solutions, and 
introduce new, high-potential solutions in growth areas such as wealth 
management and mobile-commerce;

*    Enhance its outsourcing business to more aggressively pursue joint 
ventures and other new business models to drive accelerated growth in this 
key growth area;

*    Focus its networking business on high value-added services, such as 
managed network outsourcing services, network consulting, and an expanded 
network security management practice;

*    Continue to focus its technology business on high-end, enterprise-class 
servers and de-emphasize low-margin commodity products.  

In addition, the company plans to reduce its cost structure in line with its 
lower revenue levels and its focus on higher-growth, higher-margin 
opportunities going forward.  As the first action in this cost structure 
realignment, the company is offering an early retirement incentive to 
approximately 1,500 U.S. employees.  To the extent eligible employees elect 
this program, funding will come from the company's pension plan.  The company 
estimates that it will take a one-time, pre-tax charge of approximately $200 
million in the fourth quarter of 2000 related to the early retirement and 
other actions.

Results of Operations
---------------------

For the three months ended September 30, 2000, the company reported net 
income of $42.9 million or $.14 per diluted share, compared to $138.4 
million, or $.43 per diluted share, for the three months ended September 30, 
1999.  The prior period included an extraordinary item of $12.1 million, or 
$.04 per diluted common share, for the early extinguishment of debt and a 
one-time tax benefit of $22.0 million, or $.07 per diluted share.  Excluding 
these items, earnings in the prior period were $.40 per diluted common share.



<PAGE> 8

Total revenue for the quarter ended September 30, 2000 was $1.69 billion, 
down 9% from revenue of $1.87 billion for the quarter ended September 30, 
1999. Excluding the negative impact of foreign currency translations, revenue 
in the quarter declined 6%.  The decrease in revenue was principally due to 
continuing weakness in the company's services business as well as lower sales 
of enterprise servers.  Total gross profit percent was 28.1% in the third 
quarter of 2000 compared to 35.9% in the year-ago period, principally due to 
a lower mix of higher-margin products and services than in the year-ago 
quarter and reduced utilization of services personnel.

For the three months ended September 30, 2000, selling, general and 
administrative expenses were $320.1 million (18.9% of revenue) compared to 
$354.8 million (19.0% of revenue) for the three months ended September 30, 
1999.  The decrease in these expenses reflected continued progress in 
controlling costs through the company's worldwide business process 
standardization program as well as the benefits of tight controls placed on 
discretionary spending during the quarter.  This led to a reduction in 
general and administrative expenses which was partially offset by an increase 
in selling expenses.  Research and development expenses were $77.5 million 
compared to $86.2 million a year earlier. 

For the third quarter of 2000, the company reported an operating income 
percent of 4.6% compared to 12.3% for the third quarter of 1999.

Information by business segment is presented below (in millions):

                                       Elimi-    
                            Total      nations      Services    Technology
                           -------     -------      --------    ----------
Three Months Ended
September 30, 2000
------------------
Customer revenue          $1,690.9                  $1,200.2    $490.7
Intersegment                           $( 92.8)         10.6      82.2
                          --------     -------      --------    ------
Total revenue             $1,690.9     $( 92.8)     $1,210.8    $572.9
                          ========     =======      ========    ======
Gross profit percent          28.1%                     21.6%     38.9%
                          ========                  ========    ======
Operating income
     percent                   4.6%                      1.5%      9.8%
                          ========                  ========    ======   
Three Months Ended
September 30, 1999
------------------
Customer revenue          $1,865.4                  $1,318.5    $546.9
Intersegment                           $(151.7)         17.7     134.0 
                          --------     -------      --------    ------      
Total revenue             $1,865.4     $(151.7)     $1,336.2    $680.9
                          ========     =======      ========    ====== 
Gross profit percent          35.9%                     25.8%     48.5%
                          ========                  ========    ======
Operating income
     percent                  12.3%                      7.8%     20.2%
                          ========                  ========    ======


<PAGE> 9

In the Services segment, customer revenue decreased 9% to $1.20 billion in 
the third quarter of 2000 from $1.32 billion in the third quarter of 1999 as 
an increase in networking services revenue was more than offset by declines 
in systems integration and repeatable solutions, proprietary maintenance, and 
outsourcing.  The decline in proprietary maintenance revenue, which continues 
to decline industry wide, reflected customers' higher rates of replacement of 
older equipment last year with newer systems that are under warranty and 
require less maintenance.  The gross profit percent declined to 21.6% in the 
current quarter compared to 25.8% in the prior period, principally reflecting 
reduced utilization of services personnel as well as a lower mix of higher-
margin systems integration and solutions, and proprietary maintenance revenue 
in the quarter.  Operating income percent declined to 1.5% in the current 
quarter from 7.8% last year, principally due to the gross profit decline.

In the Technology segment, customer revenue decreased 10% to $491 million in 
the third quarter of 2000 from $547 million in the prior-year period, as 
strong initial sales of the company's new Cellular MultiProcessing servers 
were more than offset by a decline in ClearPath enterprise server revenue.  
The current quarter comparison was difficult because the September 1999 
quarter reflected strong revenue levels associated with spending by customers 
in preparation for the year 2000 transition.  The gross profit percent was 
38.9% in 2000 compared to 48.5% in 1999, due in large part to a lower 
percentage of enterprise server sales in the current quarter.  Operating 
profit in this segment declined to 9.8% in 2000 from 20.2% in 1999, 
principally due to the gross profit decline.

Interest expense for the three months ended September 30, 2000 was $18.5 
million compared to $34.1 million for the three months ended September 30, 
1999.  The decline was principally due to the company's debt reduction 
program.

Other income (expense), net, which can vary from quarter to quarter, was 
income of $6.4 million in the current quarter compared to income of $1.0 
million in the year-ago quarter.  The change was primarily due to higher 
interest income and foreign exchange gains in the current period versus a 
year ago.

Income before income taxes was $65.0 million in the third quarter of 2000 
compared to $196.1 million last year.  The provision for income taxes was 
$22.1  million in the current period (34% effective rate) compared to $45.6 
million in the year-ago period.  The tax provision in the prior period 
included a one-time benefit of $22.0 million related to a U.S. Treasury 
income tax regulation pertaining to the use of net operating loss 
carryforwards of acquired companies.  Exclusive of this benefit, the 
effective tax rate in 1999 was 35%.  The decline in the effective tax rate 
was principally due to tax planning strategies.



<PAGE> 10

For the nine months ended September 30, 2000, revenue was $4.96 billion, down 
11% from $5.58 billion for the nine months ended September 30, 1999.  Net 
income in the current nine month period was $185.9 million, or $.59 per 
diluted share, compared to net income of $366.3 million, or $1.13 per diluted 
share, in the prior-year period.  Both periods include an extraordinary item 
for the early extinguishment of debt: $19.8 million, or $.06 per diluted 
share, in the nine months ended September 30, 2000 and $12.1 million, or $.04 
per diluted share, in the nine months ended September 30, 1999.  In addition, 
the prior-year period included the one-time tax benefit mentioned above.  
Excluding these items, income in the current period was $205.7 million, or 
$.65 per diluted share, compared to $356.4 million, or $1.10 per diluted 
share, in the prior-year period.

In December 1999, the Securities and Exchange Commission's ("SEC") staff 
issued Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in 
Financial Statements."  SAB No. 101 provides the staff's views on applying 
generally accepted accounting principles to selected revenue recognition 
issues and is effective for the company in the first quarter of 2000.  
However, in March and again in September 2000, in response to requests from a 
number of groups asking for additional time to determine the effect, if any, 
on registrants' revenue recognition practices, the SEC staff delayed the 
implementation date of SAB No. 101.  SAB No. 101 now must be implemented by 
the company no later than the fourth quarter of 2000, effective retroactively 
to the first quarter of 2000.  In addition, on October 12, 2000, the SEC 
staff issued a Frequently Asked Questions ("FAQ") document which clarifies 
and elaborates on the SEC staff's views regarding revenue recognition.  The 
company's initial assessment of the impact of SAB No. 101 is that it would 
not have a material effect on its consolidated financial position, 
consolidated results of operations, or liquidity.  However, the company is in 
the process of reassessing the impact, if any, of SAB No. 101 based on the 
FAQ document.

In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, 
"Accounting for Derivative Instruments and Hedging Activities".  This 
statement, which is effective for the company for the year beginning January 
1, 2001, establishes accounting and reporting standards for derivative 
instruments and hedging activities.  SFAS No. 133 requires a company to 
recognize all derivatives as either assets or liabilities in the statement of 
financial position and measure those instruments at fair value.  Changes in 
the fair value of derivatives will be reported currently in earnings or in 
other comprehensive income depending on their effectiveness pursuant to SFAS 
No. 133.  Adoption of SFAS No. 133 will also require a change in accounting 
for the company's yen cross currency swap, as discussed separately below.  
Management does not currently expect that adoption of SFAS No. 133 will have 
a material effect on the company's consolidated financial position, 
consolidated results of operations, or liquidity.

Financial Condition
-------------------

Cash and cash equivalents at September 30, 2000 were $234.9 million compared 
to $464.0 million at December 31, 1999.  During the nine months ended 
September 30, 2000, cash used for operations was $72.7 million compared to 
cash provided by operations of $320.1 million a year ago, primarily 
reflecting a decline in profitability and higher accounts receivable levels.


<PAGE> 11

Cash used for investing activities during the first nine months of 2000 was 
$182.6 million compared to $229.5 million during the first nine months of 
1999.  During the current period, both proceeds from investments and 
purchases of investments, which represent primarily foreign exchange hedging 
contract activity, declined from the prior year as a result of extending the 
duration of individual contracts to more closely match the timeframe of 
related underlying exposures.  This change in duration of foreign currency 
contracts did not significantly impact net cash flows.  In addition, the 
current period reflects lower cash usage for purchases of businesses and, as 
described below, $27.5 million proceeds from the termination of the euro 
swap.

Cash provided by financing activities during the nine months ended September 
30, 2000 was $37.8 million compared to cash usage of $322.3 million in the 
year-ago period.  The current period includes net proceeds from short-term 
borrowings of $442.5 million, principally borrowings used to repay long-term 
debt of $447.2 million, as described below.  Included in the prior period 
were payments of $197.0 million for redemptions of preferred stock and $59.4 
million for preferred stock dividends.

Total debt was $1.0 billion at September 30, 2000, up $26.9 million from 
December 31, 1999.

The company has a $400 million credit agreement which expires June 2001.  As 
of September 30, 2000, $240 million was outstanding under this agreement at 
an average rate of 7.05%.

On April 15, 2000, the company redeemed all of its $399.5 million outstanding 
12% senior notes due 2003 at the stated redemption price of 106% of 
principal.  As a result, the company recorded an extraordinary after-tax 
charge of $19.8 million, or $.06 per diluted share, for the call premium and 
unamortized debt expense.  In March 2000, the company entered into an 
additional $150 million credit agreement expiring April 2001 for the purpose 
of funding this redemption.  As of September 30, 2000, the entire amount was 
borrowed under this agreement at a rate of 7.47%.  The redemption was funded 
through a combination of cash and short-term borrowings under the company's 
two credit agreements.

The company may, from time to time, redeem, tender for, or repurchase its 
securities in the open market or in privately negotiated transactions 
depending upon availability, market conditions, and other factors.

In the third quarter of 1999, the company entered into interest rate swaps 
and currency swaps for euros and Japanese yen.  In May 2000, the company 
terminated the euro currency swap and received $27.5 million.  A gain of $.9 
million on the termination was recorded in the second quarter of 2000.  On 
October 5, 2000, the company terminated both of its interest rate swaps at a 
net cost of $.7 million which will be recognized in interest expense over the 
remaining terms of the related debt instruments.  



<PAGE> 12

The only remaining swap instrument is the Japanese yen cross currency swap, 
which has been designated as a hedge of the company's net investments 
denominated in yen.  Under this instrument, the company is obligated to 
deliver on April 1, 2008, 23.2 billion yen in exchange for $200 million.  At 
September 30, 2000, the company has a payable of $14.0 million included in 
other liabilities (long-term) related to the yen currency swap.  Under this 
instrument, the company pays yen libor plus .40% and receives US libor plus 
.83% (.78875% and 7.49% at September 30, 2000, respectively).  The company 
records the effect of the interest rate difference in interest expense, 
which, since inception of the swap, has approximated a $3.5 million reduction 
in interest expense each quarter.  Upon adoption of SFAS No. 133 on January 
1, 2001, this benefit can no longer be recorded in interest expense.

The company has on file with the Securities and Exchange Commission an 
effective registration statement covering $700 million of debt or equity 
securities, which enables the company to be prepared for future market 
opportunities.

At September 30, 2000, the company had deferred tax assets in excess of 
deferred tax liabilities of $1,382 million.  For the reasons cited below, 
management determined that it is more likely than not that $1,085 million of 
such assets will be realized, therefore resulting in a valuation allowance of 
$297 million.                                         

The company evaluates quarterly the realizability of its deferred tax assets    
and adjusts the amount of the related valuation allowance, if necessary.  The 
factors used to assess the likelihood of realization are the company's 
forecast of future taxable income, and available tax planning strategies that 
could be implemented to realize deferred tax assets. Approximately $3.2 
billion of future taxable income (predominantly U.S.) is needed to realize 
all of the net deferred tax assets.  Failure to achieve forecasted taxable 
income might affect the ultimate realization of the net deferred tax assets.  
See "Factors That May Affect Future Results" below. 

Stockholders' equity increased $217.7 million during the nine months ended 
September 30, 2000, principally reflecting net income of $185.9 million and 
$66.6 million for issuance of stock under stock option and other plans offset 
in part by currency translation of $35.2 million.

Conversion to the Euro Currency
-------------------------------

On January 1, 1999, certain member countries of the European Union 
established fixed conversion rates between their existing currencies and the 
European Union's common currency (the "euro").  The transition period for the 
introduction of the euro began on January 1, 1999.  The company is addressing 
the issues involved with the introduction of the euro.  The more important 
issues facing the company include converting information technology systems, 
reassessing currency risk, and negotiating and amending agreements.  Based on 
progress to date, the company believes that the use of the euro will not have 
a significant impact on the manner in which it conducts its business.  
Accordingly, conversion to the euro is not expected to have a material effect 
on the company's consolidated financial position, consolidated results of 
operations, or liquidity.


<PAGE> 13

Factors That May Affect Future Results
--------------------------------------

From time to time, the company provides information containing "forward-
looking" statements, as defined in the Private Securities Litigation Reform 
Act of 1995.  

All forward-looking statements rely on assumptions and are subject to risks, 
uncertainties, and other factors that could cause the company's actual 
results to differ materially from expectations.  In addition to changes in 
general economic and business conditions and natural disasters, these 
include, but are not limited to, the factors discussed below.

The company operates in an industry characterized by aggressive competition, 
rapid technological change, evolving technology standards, and short product 
life-cycles.

Future operating results will depend on the company's ability to design, 
develop, introduce, deliver, or obtain new products and services on a timely 
and cost-effective basis; on its ability to effectively implement the actions 
being taken as a result of its strategic review; on its ability to 
effectively execute its sales efforts under the organizational model 
implemented at the beginning of 2000; on its ability to mitigate the effects 
of competitive pressures and volatility in the information services and 
technology industry on revenues, pricing and margins; on its ability to 
effectively manage the shift of its business mix away from traditional high-
margin product and services offerings; and on its ability to successfully 
attract and retain highly skilled people.  In addition, future operating 
results could be impacted by market demand for and acceptance of the 
company's service and product offerings.

Certain of the company's systems integration contracts are fixed-price 
contracts under which the company assumes the risk for delivery of the 
contracted services at an agreed-upon price.  Future results will depend on 
the company's ability to profitably perform these services contracts and bid 
and obtain new contracts.

The company frequently forms alliances with third parties that have 
complementary products, services, or skills.  Future results will depend in 
part on the continuing relationships with, and on the performance and 
capabilities of, these third parties.  Future results will also depend upon 
the ability of external suppliers to deliver components at reasonable prices 
and in a timely manner and on the financial condition of, and the company's 
relationship with, distributors and other indirect channel partners.

Approximately 58% of the company's total revenue derives from international 
operations.  The risk of doing business internationally include foreign 
currency exchange rate fluctuations, changes in political or economic 
conditions, trade protection measures, and import or export licensing 
requirements.



<PAGE> 14


P
art II - OTHER INFORMATION
-------   -----------------


Item 1.   Legal Proceedings
-------   -----------------

As previously reported, most recently in the company's Quarterly Report on 
Form 10-Q for the period ended June 30, 2000, a number of purported class 
action lawsuits seeking unspecified compensatory damages have been filed 
against Unisys and various current and former officers in the U.S. District 
Court for the Eastern District of Pennsylvania by persons who acquired Unisys 
common stock during the period May 4, 1999 through October 14, 1999.  On 
February 16, 2000, these actions, which are in the early stages, were 
consolidated under the caption In re: Unisys Corporation Securities 
Litigation.  The plaintiffs allege violations of the Federal securities laws 
in connection with statements made by the company concerning certain of its 
services contracts.  The company believes it has meritorious defenses and 
intends to defend this action vigorously.  



Item 6.   Exhibits and Reports on Form 8-K
-------   --------------------------------

(a)       Exhibits

          See Exhibit Index

(b)       Reports on Form 8-K

          During the quarter ended September 30, 2000, the company filed no 
Current Reports on Form 8-K.


<PAGE> 



                               SIGNATURES
                               ----------



     Pursuant to the requirements of the Securities Exchange Act of 
1934, the registrant has duly caused this report to be signed on its 
behalf by the undersigned thereunto duly authorized.

                                              UNISYS CORPORATION

Date: October 23, 2000                      By: /s/ Janet M. Brutschea Haugen
                                                -----------------------------
                                                Janet M. Brutschea Haugen
                                                Senior Vice President and 
                                                Chief Financial Officer 
                                                (Principal Financial and 
                                                 Accounting Officer)


<PAGE> 

                             EXHIBIT INDEX

Exhibit
Number                        Description
-------                       -----------

10.1     1990 Unisys Long-Term Incentive Plan, as amended and restated 
         effective September 22, 2000

10.2     Unisys Directors Stock Option Plan, as amended and restated
         effective September 22, 2000

10.3     Unisys Corporation Deferred Compensation Plan, as amended and 
         restated effective September 22, 2000

10.4     Deferred Compensation Plan for Directors of Unisys Corporation, as
         amended and restated effective September 22, 2000

10.5     Unisys Corporation Director Stock Unit Plan, as amended and restated 
         effective September 22, 2000

11.1     Statement of Computation of Earnings Per Share for the nine months 
         ended September 30, 2000 and 1999

11.2     Statement of Computation of Earnings Per Share for the three months 
         ended September 30, 2000 and 1999

12       Statement of Computation of Ratio of Earnings to Fixed Charges

27       Financial Data Schedule






                      1990 UNISYS LONG-TERM INCENTIVE PLAN


                                   ARTICLE I
                          PURPOSE AND ADOPTION OF THE PLAN


1.1   Purpose.  The purpose of the 1990 Unisys Long-Term Incentive Plan 
(hereinafter referred to as the "Plan") is to assist in attracting and 
retaining highly competent employees and to act as an incentive in motivating 
selected officers and other key employees of Unisys and its Subsidiaries to 
achieve long-term corporate objectives.  

1.2   Adoption and Term.  The Plan has been approved by the Board and is 
effective as of January 1, 1990, and will remain in effect until terminated 
or abandoned by action of the Board; provided, however, that no Incentive 
Stock Option may be granted after December 31, 1999.  

                                    ARTICLE II
                                    DEFINITIONS

2.1   "Adjusted Fair Market Value" means, in the event of a Change in 
Control, the greater of (i) the highest Fair Market Value of a share of 
Company Common Stock during the sixty day period ending on the date of such 
Change in Control or (ii) in the case of a Change in Control described in 
Section 2.7(a) or 2.7(c), the highest price per share of Company Common Stock 
paid to holders of Company Common Stock in any transaction (or series of 
transactions) constituting or resulting from such Change in Control.

2.2   "Award" shall mean any one or
 a combination of Non-Qualified Stock 
Options or Incentive Stock Options described in Article VI, Stock 
Appreciation Rights described in Article VI, Restricted Shares described in 
Article VII, Performance Units described in Article VIII, Performance Awards 
described in Article IX, or any other award made under the terms of the Plan.

2.3   "Award Agreement" means a written agreement between the Company 
and a Participant or a written acknowledgement from the Company  specifically 
setting forth the terms and conditions of an Award granted under the Plan.

2.4   "Award Period" means, with respect to an Award, the period of time 
set forth in the Award Agreement during which specified target performance 
goals must be achieved or other conditions set forth in the Award Agreement 
must be satisfied.  
	
2.5   "Beneficiary" means an individual, trust or estate who or which by 
designation of the Participant or Transferee or operation of law succeeds to 
the rights and obligations of the Participant or Transferee under the Plan 
and Award Agreement upon the Participant's or Transferee's death.

2.6   "Board" means the Board of Directors of Unisys.  

2.7   "Change in Control" means any of the following events:

         (a)  The acquisition by any individual, entity or group (within the 
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 
1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership 
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% 
or more of either (i) the then outstanding shares of common stock of the 
Company (the "Outstanding Company Common Stock") or (ii) the combined voting 
power of the then outstanding voting securities of the Company entitled to 
vote generally in the election of directors (the "Outstanding Company Voting 
Securities"); provided, however, that for purposes of this subsection (a), 
the following acquisitions shall not constitute a Change of Control: (i) any 
acquisition directly from the Company, (ii) any acquisition by the Company, 
(iii) any acquisition by any employee benefit plan (or related trust) 
sponsored or maintained by the Company or any corporation controlled by the 
Company or (iv) any acquisition by any corporation pursuant to a transaction 
which complies with clauses (i), (ii) and (iii) of subsection (c) of this 
Section 2.07; or

         (b)  Individuals who, as of May 25, 1995, constitute the Board (the 
"Incumbent Board") cease for any reason to constitute at least a majority of 
the Board; provided, however, that any individual becoming a director 
subsequent to the date hereof whose election, or nomination for election by 
the Company's shareholders, was approved by a vote of at least a majority of 
the directors then comprising the Incumbent Board shall be considered as 
though such individual were a member of the Incumbent Board, but excluding, 
for this purpose, any such individual whose initial assumption of office 
occurs as a result of an actual or threatened election contest with respect 
to the election or removal of directors or other actual or threatened 
solicitation of proxies or consents by or on behalf of a Person other than 
the Board; or

         (c)  Consummation of a reorganization, merger or consolidation or 
sale or other disposition of all or substantially all of the assets of the 
Company (a "Business Combination"), in each case, unless, following such 
Business Combination, (i) all or substantially all of the individuals and 
entities who were the beneficial owners, respectively, of the Outstanding 
Company Common Stock and Outstanding Company Voting Securities immediately 
prior to such Business Combination beneficially own, directly or indirectly, 
more than 50% of, respectively, the then outstanding shares of common stock 
and the combined voting power of the then outstanding voting securities 
entitled to vote generally in the election of directors, as the case may be, 
of the corporation resulting from such Business Combination (including, 
without limitation, a corporation which as a result of such transaction owns 
the Company or all or substantially all of the Company's assets either 
directly or through one or more subsidiaries) in substantially the same 
proportions as their ownership, immediately prior to such Business 
Combination of the Outstanding Company Common Stock and Outstanding Company 
Voting Securities, as the case may be, (ii) no Person (excluding any 
corporation resulting from such Business Combination or any employee benefit 
plan (or related trust) of the Company or such corporation resulting from 
such Business Combination) beneficially owns, directly or indirectly, 20% or 
more of, respectively, the then outstanding shares of common stock of the 
corporation resulting from such Business Combination or the combined voting 
power of the then outstanding voting securities of such corporation except to 
the extent that such ownership existed prior to the Business Combination and 
(iii) at least a majority of the members of the board of directors of the 
corporation resulting from such Business Combination were members of the 
Incumbent Board at the time of the execution of the initial agreement, or of 
the action of the Board, providing for such Business Combination; or

         (d)  Approval by the shareholders of the Company of a complete 
liquidation or dissolution of the Company.

2.8   "Code" means the Internal Revenue Code of 1986, as amended.  
References to a section of the Code shall include that section and any 
comparable section or sections of any future legislation that amends, 
supplement or supersedes said section.

2.9   "Committee" means the Corporate Governance and Compensation 
Committee of the Board.

2.10  "Company Common Stock" means the common stock of Unisys, par value 
$.01 per share.

2.11  "Company Voting Securities" means the combined voting power of all 
outstanding voting securities of Unisys entitled to vote generally in the 
election of directors for the Board.

2.12  "Date of Grant" means the date designated by the Committee as the 
date as of which it grants an Award, which shall not be earlier than the date 
on which the Committee approves the granting of such Award.  

2.13  "Exchange Act" means the Securities Exchange Act of 1934, as 
amended.

2.14  "Exercise Price" means, with respect to a Stock Appreciation 
Right, the amount established by the Committee in the Award Agreement which 
is to be subtracted from the Fair Market Value on the date of exercise in 
order to determine the amount of the payment to be made to the Participant, 
as further described in Section 6.2.

2.15  "Fair Market Value" means, on any date, the average of the high 
and low quoted sales prices of a share of Company Common Stock, sold regular 
way, through the official close of the New York Stock Exchange at 4:00 p.m. 
U.S. Eastern Standard Time on such date or, if there were no sales on such 
date, on the last date preceding such date on which a sale was reported.

2.16  "Incentive Stock Option" means a stock option within the meaning 
of Section 422A of the Code.

2.17  "Incumbent Board" means the Board as of May 25, 1995. 

2.18  "Non-Qualified Stock Option" means a stock option which is not an 
Incentive Stock Option.

2.19  "Normal Retirement Date" means the date on which a Participant is 
eligible to retire with unreduced benefits under a defined benefit pension 
plan or arrangement of Unisys or one of its Subsidiaries or, in the event 
that the Participant is not a member of such a defined benefit pension plan 
or arrangement, the date on which the Participant would otherwise be eligible 
to retire with unreduced benefits under the Unisys Pension Plan.  

2.20  "Options" means all Non-Qualified Stock Options and Incentive 
Stock Options granted at any time under the Plan.

2.21  "Other Retirement Date" means a date earlier than a Participant's 
Normal Retirement Date which is specifically designated by the Committee to 
be the date upon which a Participant retires for purposes of this Plan.  

2.22  "Outstanding Company Common Stock" means, at any time, the issued 
and outstanding shares of Company Common Stock. 

2.23  "Participant" shall have the meaning set forth in Section 5.1.

2.24  "Performance Awards" means Awards granted in accordance with 
Article IX.

2.25  "Performance Units" means Awards granted in accordance with 
Article VIII.

2.26  "Plan" shall mean the 1990 Unisys Long-Term Incentive Plan as 
described herein and as may be amended from time to time.

2.27  "Purchase Price", with respect to Options, shall have the meaning 
set forth in Section 6.1(b).

2.28  "Restricted Shares" means Company Common Stock subject to 
restrictions imposed in connection with Awards granted under Article VII.

2.29  "Rule 16b-3" means Rule 16b-3 promulgated by the Securities and 
Exchange Commission under Section 16 of the Exchange Act, as it may be 
amended from time to time, and any successor rule.  

2.30  "Stock Appreciation Right" means Awards granted in accordance with 
Article VI.

2.31  "Stock Award" means a Non-Qualified Stock Option, an Incentive 
Stock Option, a Stock Appreciation Right, a Restricted Stock Award or any 
other stock-based Award authorized by the Board hereunder.

2.32  "Subsidiary" shall have the meaning set forth in Section 425(f) of 
the Code.  

2.33  "Termination of Employment" means the voluntary or involuntary 
termination of a Participant's employment with Unisys or a 
Subsidiary for any reason, including death, disability, retirement 
or as the result of the divestiture of the Participant's employer 
or any similar transaction in which the Participant's employer 
ceases to be Unisys or one of its Subsidiaries.  Whether military 
or other government or eleemosynary service shall constitute 
Termination of Employment, or whether a Termination of Employment 
is a result of disability, shall be determined in each case by the 
Committee in its sole discretion. 

2.34  "Transferee" means the holder of Non-Qualified Stock Options after 
a transfer in accordance with Section 11.4 and the Award Agreement.

2.35  "Unisys" means Unisys Corporation, a Delaware corporation.

                                 ARTICLE III
                                ADMINISTRATION

3.1   Committee.  The Plan shall be administered by the Committee.  The 
Committee shall be selected from time to time by the Board, and shall be 
comprised of not less than three members of the Board or such other persons 
who would constitute a disinterested administrator under the requirements of 
Rule 16b-3.  The Committee shall have exclusive and final authority in each 
determination, interpretation or other action affecting the Plan and its 
Participants.  The Committee shall have the sole discretionary authority to 
interpret the Plan, to establish and modify administrative rules for the 
Plan, to impose such conditions and restrictions on Awards as it determines 
appropriate, to cancel Awards (including those made pursuant to other plans 
of Unisys), to allow some or all Non-Qualified Stock Options of some or all 
Participants to be transferable subject to the limitations set forth in the 
Award Agreement, and to substitute new options for underwater options 
(including options granted under other Plans of Unisys) with the consent of 
the recipient, and to take such steps in connection with the Plan and Awards 
granted as it may deem necessary or advisable.  The Committee may, with 
respect to Participants who are not subject to Section 16(b) of the Exchange 
Act, delegate such of its powers and authority under the Plan as it deems 
appropriate to designated officers or employees of Unisys.

                                   ARTICLE IV
                                      STOCK

4.1   Number of Shares Issuable.  Subject to adjustments as provided in 
Section 11.9, the stock to be offered under the Plan shall be authorized and 
unissued shares, or issued shares which shall have been reacquired by Unisys, 
of Company Common Stock.  The total number of shares initially authorized to 
be issued under the Plan shall be 4 million shares, which limit shall be 
increased as of January 1 of each calendar year commencing in 1991 by a 
number of shares equal to 2% of the total amount of Outstanding Company 
Common Stock (not including shares issued under this Plan) as of such January 
1; provided, however, that not more than one million shares of Company Common 
Stock shall be issued upon the exercise of Incentive Stock Options awarded 
under the Plan.  In addition, the 1.4 million shares remaining available for 
the grant of awards as of January 1, 1990 under the terms of the 1982 Unisys 
Long-Term Incentive Plan shall be available for issuance hereunder.

4.2   Shares Subject to Terminated Awards.  The shares of Company Common 
Stock involved in any unexercised portions of terminated Options (including 
cancelled Options) granted under Article VI, shares of Company Common Stock 
forfeited as provided in Section 7.2(a), unexercised shares from terminated 
awards under Section 9.2 and shares of Company Common Stock subject to Awards 
which are otherwise surrendered by the Participant or Transferee may again be 
subject to Stock Awards.  Shares of Company Common Stock subject to Options, 
or portions thereof, which have been surrendered in connection with the 
exercise of Stock Appreciation Rights shall not be available for subsequent 
Option grants under the Plan, but shares of Company Common Stock issued in 
payment of such Stock Appreciation Rights shall not be charged against the 
number of shares of Company Common Stock available for the grant of Options.  
Any shares of Company Common Stock issued by Unisys pursuant to its 
assumption or substitution of outstanding grants from acquired companies 
shall not reduce the number of shares available for grants under this Plan. 

                                  ARTICLE V
                                 PARTICIPANTS

5.1   Eligible Participants.  Participants in the Plan shall be such 
officers and other key employees of Unisys and its Subsidiaries, whether or 
not members of the Board, as the Committee, in its sole discretion, may 
designate from time to time.  The Committee's designation of a Participant in 
any year shall not require the Committee to designate such person to receive 
Awards or grants in any other year.  The designation of a Participant to 
receive awards or grants under one portion of the Plan does not require the 
Committee to include such Participant under other portions of the Plan.  The 
Committee shall consider such factors as it deems pertinent in selecting 
Participants and in determining the type and amount of their respective 
Awards.  

                                  ARTICLE VI
                  STOCK OPTIONS AND STOCK APPRECIATION RIGHTS

6.1   Option Awards.  

         (a)  The Committee may grant, to such Participants as the 
Committee may select, Options entitling the Participant or 
Transferee to purchase Company Common Stock from Unisys in such 
quantity, at such price, and on such terms and subject to such 
conditions, not inconsistent with the terms of this Plan, as may 
be established by the Committee.  The terms of any Stock Option 
granted under this Plan shall be set forth in an Award Agreement.

         (b)  Purchase Price of Options.  The Purchase Price of each 
share of Company Common Stock which may be purchased upon exercise 
of any Option granted under the Plan shall be determined by the 
Committee, provided that, with respect to Participants or 
Transferees subject to Section 16(b) of the Exchange Act, such 
Purchase Price shall be not less than 50% of the Fair Market Value 
on the Date of Grant, and provided further that the Purchase Price 
for shares of Company Common Stock purchased pursuant to Stock 
Options designated by the Committee as Incentive Stock Options 
shall be equal to or greater than the Fair Market Value on the 
Date of Grant as required under Section 422A of the Code.  

         (c)  Designation of Incentive Stock Options.  Except as 
otherwise expressly provided in the Plan, the Committee may 
designate, at the time of the grant of each Option, the Option as 
an Incentive Stock Option under Section 422A of the Code.  

              (1)  Incentive Stock Option Share Limitation.  No 
Participant may be granted Incentive Stock Options under the 
Plan (or any other plans of Unisys) which would result in 
stock with an aggregate Fair Market Value (measured on the 
Date of Grant) of more than $100,000 first becoming 
exercisable in any one calendar year, or which would entitle 
such Participant to purchase a number of shares greater than 
the maximum number permitted by Section 422A of the Code as 
in effect on the Date of Grant.

              (2)  Other Incentive Stock Option Terms.  Whenever 
possible, each provision in the Plan and in every Option 
granted under this Plan which is designated by the Committee 
as an Incentive Stock Option shall be interpreted in such a 
manner as to entitle the Option to the tax treatment 
afforded by Section 422A of the Code.  If any provision of 
this Plan or any Option designated by the Committee as an 
Incentive Stock Option shall be held not to comply with 
requirements necessary to entitle such Option to such tax 
treatment, then (A) such provision shall be deemed to have 
contained from the outset such language as shall be 
necessary to entitle the Option to the tax treatment 
afforded under Section 422A of the Code, and (B) all other 
provisions of this Plan and the Stock Option Agreement shall 
remain in full force and effect.  If any agreement covering 
an Option designated by the Committee to be an Incentive 
Stock Option under this Plan shall not explicitly include 
any terms required to entitle such Incentive Stock Option to 
the tax treatment afforded by Section 422A of the Code, all 
such terms shall be deemed implicit in the designation of 
such Option and the Option shall be deemed to have been 
granted subject to all such terms. 

         (d)  Rights as a Stockholder.  A Participant or Transferee 
shall have no rights as a stockholder with respect to any shares 
of Company Common Stock covered by an Option until the Participant 
or Transferee shall have become the holder of record of any such 
shares, and no adjustment shall be made for dividends in cash or 
other property or distributions or other rights with respect to 
any such shares of Company Common Stock for which the record date 
is prior to the date on which the Participant or a Transferee of 
the Option shall have become the holder of record of any such 
shares covered by the Option.

6.2   Stock Appreciation Rights.

         (a)  Stock Appreciation Right Awards.  The Committee is 
authorized to grant to any Participant a Stock Appreciation Right 
covering any share of Company Common Stock which is at the Date of 
Grant also covered by an Option granted to the same Participant 
either prior to or simultaneously with the grant to such 
Participant of the Stock Appreciation Right, provided:  (1) any 
Option covering any share of Company Common Stock shall expire and 
not be exercisable upon the exercise of any Stock Appreciation 
Right with respect to the same share; (2) any Stock Appreciation 
Right covering any share of Company Common Stock shall not be 
exercisable upon the exercise of any related Option with respect 
to the same share; and (3) an Option and Stock Appreciation Right 
covering the same share of Company Common Stock may not be 
exercised simultaneously.  Upon exercise of a Stock Appreciation 
Right with respect to a share of Company Common Stock, the 
Participant will be entitled to receive an amount equal to the 
difference between (y) the Exercise Price established in the Award 
Agreement from (z) the Fair Market Value of a share of Company 
Common Stock on the date of exercise, which amount shall be 
payable as provided in Section 6.2(e).

         (b)  Exercise Price.  The Exercise Price established under 
any Stock Appreciation Right granted under this Plan shall be 
determined by the Committee and shall not be less than the lower 
of (1) the Purchase Price of the related Option or (2) 50% of the 
Fair Market Value on the Date of Grant of the Stock Appreciation 
Right.  Upon exercise of Stock Appreciation Rights, the number of 
shares subject to exercise under the related Option shall 
automatically be reduced by the number of shares of Company Common 
Stock represented by the Option or portion thereof which is 
surrendered as a result of the exercise of such Stock Appreciation 
Right.

         (c)  Payment of Incremental Value.  Any payment which may 
become due from Unisys by reason of a Participant's exercise of a 
Stock Appreciation Right may be paid to the Participant as 
determined by the Committee (1) all in cash, (2) all in Company 
Common Stock, or (3) in any combination of cash and Company Common 
Stock.  In the event that all or a portion of the payment is made 
in Company Common Stock, the number of shares of the Company 
Common Stock delivered in satisfaction of such payment shall be 
determined by dividing the amount of the payment by the Fair 
Market Value on the Exercise Date.  The Committee may determine 
whether payment upon exercise of a Stock Appreciation Right will 
be made in cash or stock, or a combination thereof, upon or at any 
time prior to the exercise of such Stock Appreciation Right.  No 
fractional share of Company Common Stock shall be issued to make 
any payment; if any fractional shares would be issuable, the mix 
of cash and Company Common Stock payable to the Participant shall 
be adjusted as directed by the Committee to avoid the issuance of 
any fractional share.

6.3   Terms of Stock Options and Stock Appreciation Rights.

         (a)  Conditions on Exercise.  An Award Agreement with 
respect to Options or Stock Appreciation Rights may contain such 
waiting periods, exercise dates and restrictions on exercise 
(including, but not limited to, periodic installments which may be 
cumulative) as may be determined by the Committee at the time of 
grant.  Where payment is to be made in whole or in part in cash, 
no Stock Appreciation Right may be exercised prior to six months 
from the Date of Grant.  

         (b)  Duration of Options and Stock Appreciation Rights.  
Options and Stock Appreciation Rights shall terminate after the 
first to occur of the following events:  

              (1)  Expiration of the Option or Stock Appreciation Right 
as provided in the Award Agreement; or

              (2)  Termination of the Award as provided in 
Section 6.3(e), following the Participant's Termination of 
Employment; or

              (3)  In the case of an Incentive Stock Option, ten years 
from the Date of Grant; or 

              (4)  Solely in the case of Stock Appreciation Rights, upon 
the expiration of the related Options.

         (c)  Acceleration of Exercise Time.  The Committee, in its 
sole discretion, shall have the right (but shall not in any case 
be obligated) to permit purchase of shares under any Option 
exercise or exercise of a Stock Appreciation Right prior to the 
time such Option or Stock Appreciation Right would otherwise 
become exercisable under the terms of the Award Agreement.

         (d)  Extension of Exercise Time.  In addition to the 
extensions permitted under Section 6.3(e) in the event of 
Termination of Employment, the Committee, in its sole discretion, 
shall have the right (but shall not in any case be obligated) to 
permit any Option or Stock Appreciation Right granted under this 
Plan to be exercised after its expiration date described in 
Section 6.3(e), subject, however to the limitations described in 
Section 6.3(b)(1), (3) and (4).

         (e)  Exercise of Options or Stock Appreciation Rights upon 
Termination of Employment.

              (1)  Termination of Vested Options and Stock Appreciation 
Rights Upon Termination of Employment.

                   (A)  Termination.  In the event of Termination of 
Employment of a Participant other than because of death, 
disability or retirement on a Normal Retirement Date, to the 
extent the right to exercise the Option or Stock 
Appreciation Right has accrued at the date of Termination of 
Employment, the right of the Participant or Transferee to 
exercise the Option or Stock Appreciation Right under the 
Plan shall terminate at the date of such Termination of 
Employment, unless otherwise provided in this Section 6.3(e) 
or as otherwise provided by the Committee in accordance with 
Section 6.3(d).

                   (B)  Disability or Retirement.  Upon a Participant's 
Termination of Employment by reason of disability or 
retirement on a Normal Retirement Date, a Participant or 
Transferee may, within five years after the Termination of 
Employment, exercise all or a part of his or her Options 
which were exercisable upon such Termination of Employment 
(or which became exercisable at a later date pursuant to 
Sections 6.3(e)(2) or (3)), and may, within six months after 
Termination of Employment, exercise all or a part of his or 
her Stock Appreciation Rights which he or she was entitled 
to exercise upon Termination of Employment (or which became 
exercisable at a later date pursuant to Sections 6.3(e)(2) 
or (3)).  In no event, however, may any Option or Stock 
Appreciation Right be exercised later than the date 
described in Section 6.3(b)(1), (3) or (4).

                   (C)  Death.  In the event of the death of a 
Participant while employed by Unisys or a Subsidiary, or 
within the additional period of time from the date of 
Termination of Employment and prior to the expiration of the 
Option or Stock Appreciation Right as permitted in Section 
6.3(e)(1)(B) or Sections 6.3(e)(2) or (3), to the extent the 
right to exercise the Option or Stock Appreciation Right 
accrued as of the date of such Termination of Employment or 
thereafter and did not expire during such additional period 
and prior to the Participant's death, the right of the 
Participant's Beneficiary or Transferee to exercise the 
Option under the Plan shall expire upon the earliest of (i) 
five years from the date of the Participant's death or (ii) 
five years from the date of the Participant's Termination of 
Employment or (iii) the date of expiration of the Option 
determined pursuant to Section 6.3(b)(1), (3) or (4).  
Unless otherwise provided by the Committee in accordance 
with Section 6.3(d), Stock Appreciation Rights shall expire 
upon the Participant's death.

              (2)  Termination of Unvested Options or Stock Appreciation 
Rights Upon Termination of Employment.  Except as otherwise 
provided in Section 6.3(e)(3), to the extent the right to exercise 
an Option or a Stock Appreciation Right, or any portion thereof, 
has not accrued as of the date of Termination of Employment, such 
right shall expire at the date of such Termination of Employment. 
 Notwithstanding the foregoing, the Committee, within its 
discretion and under such terms as it deems appropriate, may 
permit a Participant who terminates employment on a Normal 
Retirement Date or Other Retirement Date and who will continue to 
render significant services to Unisys or one of its Subsidiaries 
after his or her Termination of Employment, to continue vesting in 
his or her Options and Stock Appreciation Rights during the period 
in which the individual continues to render such services.

              (3)  Continued Vesting in Options upon Retirement at Age 55 
with Five Years of Service -- Extended Period of Exercise -- 
Effective for Option Grants Made on and after April 22, 1999.  
Notwithstanding anything in this Section 6.3(e) to the contrary, 
with respect to any Option or Stock Appreciation Right granted on 
or after April 22, 1999,

                   (A)  to the extent that the right to exercise the 
Option or Stock Appreciation Right, or any portion thereof, 
has not accrued as of the date of Termination of Employment, 
the Participant or Transferee shall continue to vest in the 
Option or Stock Appreciation Right after Termination of 
Employment in accordance with the vesting schedule contained 
in the applicable Award Agreement, and

                   (B)  the Participant or Transferee may exercise the 
Option, to the extent the right to exercise has accrued as 
of the date of Termination of Employment or thereafter in 
accordance with this Section 6.3(e)(3), within five years of 
the date of the Participant's Termination of Employment, and 
may exercise the Stock Appreciation Right, to the extent the 
right to exercise has accrued as of the date of Termination 
of Employment or thereafter in accordance with this Section 
6.3(e)(3), within six months of the date of the 
Participant's Termination of Employment,

     provided that the Termination of Employment occurs after the 
Participant has attained age 55 and completed five years of 
service with Unisys and/or its Subsidiaries.  In no event, 
however, may any Option or Stock Appreciation Right be exercised 
later than the date described in Section 6.3(b)(1), (3) or (4).

     The rights described in this Section 6.3(e)(3) may be revoked by 
the Senior Vice-President, Worldwide Human Resources, or his/her 
successor, if in his/her discretion it is determined that the 
Participant has been terminated for cause or, before or after 
termination, has engaged in conduct that is deemed to be 
materially adverse or detrimental to the interests of the Company, 
including, but not limited to, the violation of any restrictive 
covenant contained in the Participant's stock option Award 
Agreement.

6.4   Exercise Procedures.  Each Option and Stock Appreciation Right 
granted under the Plan shall be exercised by written notice to Unisys which 
must be received by the office of Unisys designated in the Award Agreement on 
or before the expiration date of the Award.  The Purchase Price of shares 
purchased upon exercise of an Option granted under the Plan shall be paid in 
full in cash by the Participant or Transferee pursuant to the Award 
Agreement; provided, however, that the Committee may (but need not) permit 
payment to be made by delivery to Unisys of either (a) shares of Company 
Common Stock (which may include Restricted Shares or shares issued in 
connection with the exercise of the Option, subject to such rules as the 
Committee deems appropriate) or (b) any combination of cash and shares of 
Company Common Stock, or (c) such other consideration as the Committee deems 
appropriate and in compliance with applicable law (including payment in 
accordance with a cashless exercise program under which, if so instructed by 
the Participant or Transferee, shares of Company Common Stock may be issued 
directly to the Participant's or Transferee's broker or dealer upon receipt 
of the Purchase Price in cash from the broker or dealer.)  In the event that 
any Company Common Stock shall be transferred to Unisys to satisfy all or any 
part of the Purchase Price, the part of the Purchase Price deemed to have 
been satisfied by such transfer of Company Common Stock shall be equal to the 
product derived by multiplying the Fair Market Value as of the date of 
exercise times the number of shares transferred.  The Participant or 
Transferee may not transfer to Unisys in satisfaction of the Purchase Price 
(y) a number of shares which when multiplied times the Fair Market Value as 
of the date of exercise would result in a product greater than the Purchase 
Price or (z) any fractional share of Company Common Stock.  Any part of the 
Purchase Price paid in cash upon the exercise of any Option shall be added to 
the general funds of Unisys and be used for any proper corporate purpose.  
Unless the Committee shall otherwise determine, any Company Common Stock 
transferred to Unisys as payment of all or part of the Purchase Price upon 
the exercise of any Option shall be held as treasury shares.

6.5   Change in Control.

         (a)  Options.  In the event of a Change in Control, (1) all 
Options outstanding on the date of such Change in Control shall 
become immediately and fully exercisable, and (2) a Participant 
who is an elected officer or director of Unisys will be permitted 
to surrender for cancellation within sixty days after such Change 
in Control any Option or portion of an Option to the extent not 
yet exercised (or with respect to an Option or portion of an 
Option granted less than six months prior to the date of the 
Change in Control, within sixty days after the expiration of a six 
month period following the Date of Grant) and to receive a cash 
payment in an amount equal to the excess, if any, of (A) in the 
case of a Non-Qualified Stock Option, the Adjusted Fair Market 
Value of the Company Common Stock subject to the Option or a 
portion thereof surrendered or in the case of an Incentive Stock 
Option, the Fair Market Value of the Company Common Stock subject 
to the Option or portion thereof surrendered, over (B) the 
Purchase Price.  The provisions of this Section 6.5(a) shall be 
applicable to Non-Qualified Stock Options and Incentive Stock 
Options.  The provisions of this Section 6.5(a) shall not be 
applicable to any Options granted to a Participant if any Change 
in Control results from such Participant's beneficial ownership 
(within the meaning of Rule 13d(3) under the Exchange Act) of 
Company Common Stock or Company Voting Securities.

         (b)  Stock Appreciation Rights.  In the event of a Change 
in Control, all Stock Appreciation Rights shall become immediately 
and fully exercisable.  Upon any exercise of a Stock Appreciation 
Right (other than a  Stock Appreciation Right granted in tandem 
with a related Incentive Stock Option) or any portion thereof 
during the 60-day period following the Change in Control, (or with 
respect to a Stock Appreciation Right granted to an officer or 
director of Unisys less than six months prior to the date of the 
Change in Control, within sixty days after the expiration of a six 
month period following the Date of Grant) the amount payable shall 
be determined by reference to the Adjusted Fair Market Value of 
the Company Common Stock and shall be paid in cash.  Stock 
Appreciation Rights granted in connection with Incentive Stock 
Options will be payable as determined by reference to the Fair 
Market Value of the Company Common Stock on the date of such 
exercise and shall be paid in cash.  The provisions of this 
Section 6.5(b) shall not be applicable to any Stock Appreciation 
Rights granted to a Participant if any Change in Control results 
from such Participant's beneficial ownership (within the meaning 
of Rule 13d(3) under the Exchange Act) of Company Common Stock or 
Company Voting Securities.

                            ARTICLE VII
                         RESTRICTED SHARES

7.1   Restricted Share Awards.  The Committee may grant to any 
Participant an Award of shares of Company Common Stock in such quantity, and 
on such terms, conditions and restrictions (whether based on performance 
standards, periods of service or otherwise) as the Committee shall establish. 
 The terms of any Restricted Share Award granted under this Plan shall be set 
forth in an Award Agreement with provisions subject to and not inconsistent 
with this Plan.  

         (a)  Issuance of Restricted Shares.  As soon as practicable 
after the Date of Grant of a Restricted Share Award by the 
Committee, Unisys shall cause to be transferred on the books of 
the Company, shares of Company Common Stock, evidencing the 
Restricted Shares covered by the Award, but subject to forfeiture 
to Unisys as of the Date of Grant if an Award Agreement with 
respect to the Restricted Shares covered by the Award is not duly 
executed by the Participant and timely returned to Unisys.  At the 
discretion of the Company, the shares will be registered on behalf 
of the Participant in book entry form or will be registered in the 
name of the Participant with a stock certificate, appropriately 
legended to reference the applicable restrictions, duly issued.  
All shares of Company Common Stock covered by Awards under this 
Article VII shall be subject to the restrictions, terms and 
conditions contained in the Plan and Award Agreement entered into 
by the Participant.

         (b)  Stockholder Rights.  Beginning on the Date of Grant of 
the Restricted Share Award and subject to execution of the Award 
Agreement provided for in Section 7.1(a), the Participant will 
become a stockholder of Unisys with respect to all shares 
represented under the Award Agreement and shall have all of the 
rights of a stockholder, including, but not limited to, the right 
to vote such shares and the right to receive dividends (or 
dividend equivalents); provided, however, that any shares of 
Company Common Stock distributed as a dividend or otherwise with 
respect to any Restricted Shares as to which the restrictions have 
not yet lapsed shall be subject to the same restrictions as such 
Restricted Shares and shall be represented by book entry and held 
as prescribed in Section 7.1(a); and 

         (c)  Restriction on Transferability.  None of the 
Restricted Shares may be assigned or transferred (other than by 
will or the laws of descent and distribution, or to an inter vivos 
trust with respect to which the Participant is treated as the 
owner under sections 671 through 677 of the Code), pledged or sold 
prior to their delivery to a Participant or, in the case of a 
Participant's death, to the Participant's Beneficiary; and 

         (d)  Delivery of Shares Upon Vesting.  Upon expiration or 
earlier termination of the forfeiture period without a forfeiture 
and the satisfaction of or release from any other conditions 
prescribed by the Committee, or at such earlier time as provided 
under the provisions of Section 7.3, the restrictions applicable 
to the Restricted Shares shall lapse.  As promptly as 
administratively feasible thereafter, Unisys shall deliver to the 
Participant or, in case of the Participant's death, to the 
Participant's Beneficiary, a stock certificate for the appropriate 
number of shares of Company Common Stock, free of all such 
restrictions, except for any restrictions that may be imposed by 
law.  Except in the case where a Participant has made an Election 
described in Section 11.5(c), the appropriate number of shares 
shall equal the number of Restricted Shares with respect to which 
the restrictions have lapsed, less the number of shares of Company 
Common Stock, rounded up for any fraction to the next whole 
number, whose Fair Market Value as of the date on which the 
restrictions lapse is equal to such amount as is determined by 
Unisys to be sufficient to satisfy applicable federal, state or 
local withholding tax requirements.  Unisys shall remit in a 
timely manner to the appropriate taxing authorities the amount so 
withheld with any partial share excess applied to federal 
withholding.  Although the stock certificate delivered to the 
Participant or the Participant's beneficiary will be for a net 
number of shares, the Participant or the Participant's beneficiary 
shall be considered, for tax purposes, to have received a number 
of shares of Company Common Stock equal to the full number of 
Restricted Shares with respect to which the restrictions have 
lapsed.  In the case where a Participant has made an Election 
described in Section 11.5(c) with respect to Restricted Shares, 
the appropriate number shall equal the number of Restricted Shares 
with respect to which the restrictions have lapsed.  

7.2   Terms of Restricted Shares.

         (a)  Forfeiture of Restricted Shares.  Subject to 
Sections 7.2(b) and 7.3, all of the Restricted Shares with respect 
to a Restricted Share Award shall be forfeited and returned to 
Unisys and all rights of the Participant with respect to such 
Restricted Shares shall terminate unless the Participant continues 
in the service of Unisys or a Subsidiary as an employee until the 
expiration of the forfeiture period and satisfies any other 
conditions set forth in the Award Agreement.  The Committee shall 
determine the forfeiture period and any other terms and conditions 
applicable with respect to any Restricted Share Award.

         (b)  Waiver of Forfeiture Period.  Notwithstanding anything 
contained in this Article VII to the contrary, the Committee may, 
in its sole discretion, waive the forfeiture period and any other 
conditions set forth in any Award Agreement under certain 
circumstances (including the death, disability or retirement of 
the Participant or a material change in circumstances arising 
after the date of an Award) and subject to such terms and 
conditions (including forfeiture of a proportionate number of the 
Restricted Shares) as the Committee shall deem appropriate.

7.3   Change in Control.  In the event of a Change in Control, and 
irrespective of whether or not the one year period following the date of the 
Restricted Share Award required under the provisions of Section 7.2(a) has 
been met, all restrictions applicable to a pro-rata portion of the Restricted 
Shares represented by each such Restricted Share Award shall terminate fully 
and the Participant shall immediately have the right to the delivery of stock 
certificates in accordance with Section 7.1(d).  The pro-rata portion of the 
Participant's Restricted Shares represented by each Restricted Share Award 
shall be determined by multiplying the number of shares subject to such Award 
by a fraction, the numerator of which is the number of whole months such 
Participant was employed during the Award period through the date of the 
Change in Control and the denominator of which is the number of months in the 
Award Period.  In the event a Participant remains in the employment of Unisys 
following a Change in Control through the end of the Award Period for a 
Restricted Share Award with respect to which a pro-rata portion of the 
Restricted Shares granted under such Award has been delivered to a 
Participant under this Section, the Participant shall be entitled to receive 
the difference between (x) the number of Restricted Shares delivered pursuant 
to this Section and (y) the number of Restricted Shares or other 
consideration otherwise deliverable or payable at such time pursuant to the 
Award.

                                  ARTICLE VIII
                                PERFORMANCE UNITS

8.1   Performance Unit Awards. 

         (a)  Grant of Performance Units.  The Committee may grant 
to Participants Performance Units, the value of which is related 
to the value of or the appreciation in the value of Company Common 
Stock.  The number of Performance Units awarded, the method for 
valuing such Units, and such terms and conditions as the Committee 
deems appropriate shall be set forth in an Award Agreement.  At 
the discretion of and subject to any terms established by the 
Committee, Participants may be credited with dividend equivalents 
or other distribution equivalents to correspond to dividends or 
distributions made with respect to holders of Company Common 
Stock.

         (b)  Payment of Performance Units.  Performance Units may 
become payable to the Participant after a specified period of time 
or upon the occurrence of a specified event such as death, 
disability, retirement or such other date, and may be subject to 
forfeiture under such circumstances, as are established by the 
Committee in the Award Agreement.  Payment may be made in cash, 
Company Common Stock or in such other form, in a lump sum or 
installments, as the Committee establishes in the Award Agreement.

                                 ARTICLE IX
                              PERFORMANCE AWARDS

9.1   Performance Awards.  

         (a)  Award Periods and Calculations of Potential Incentive 
Amounts.  The Committee may grant Performance Awards to 
Participants.  A Performance Award shall consist of the right to 
receive a payment contingent upon certain predetermined 
performance targets and earned during an Award Period.  
Performance Awards may be made in conjunction with, or in addition 
to, Restricted Share Awards made under Article VII and may, in 
addition to predetermined performance targets, be based on other 
factors such as changes in the Fair Market Value over the Award 
Period.  Unless otherwise determined by the Committee, the Award 
Period shall be a period of three calendar years commencing as of 
the beginning of the calendar year in which the Performance Award 
is granted.  The Committee, in its discretion and under such terms 
as it deems appropriate, may permit newly eligible employees, such 
as those who are promoted or newly hired, to receive Performance 
Awards after an Award Period has commenced.  A new Award Period 
shall commence each year, unless otherwise specified by the 
Committee.  

         (b)  Performance Targets.  The performance targets may 
include specified levels of earnings per share, return on 
investment, return on shareholder equity and/or such other goals 
related to Unisys performance as may be established by the 
Committee in its discretion.  The performance targets established 
by the Committee may vary for different Award Periods and need not 
be the same for each Participant receiving a Performance Award in 
an Award Period.  The Committee, in its discretion, but only under 
extraordinary circumstances as determined by the Committee, may 
change any prior determination of performance targets for any 
Award Period at any time prior to the final determination of the 
Award when events or transactions occur to cause the performance 
targets to be an inappropriate measure of achievement.  

         (c)  Earning Performance Awards.  The Committee at the Date 
of Grant shall prescribe a formula to determine the percentage of 
the Performance Award to be earned based upon the degree of 
attainment of performance targets.  In the event the minimum 
performance targets established by the Committee is not achieved, 
no payment shall be made to the Participant.  In the event the 
performance targets are fully achieved, 100% of the Performance 
Award shall be paid to the Participant.  The Committee may provide 
for grants up to a maximum of 150% of Performance Awards for 
achievement exceeding performance targets. 

         (d)  Payment of Earned Performance Awards.  Payments of 
earned Performance Awards shall be made in cash or Company Common 
Stock, or a combination of cash and Company Stock at the 
discretion of the Committee.  Payment normally will be made as 
soon as is practicable following the end of an Award Period; the 
Committee, however, may permit deferral of the payment of all or a 
portion of a Performance Award paid in cash upon the request of 
the Participant timely made in accordance with rules prescribed by 
the Committee.  Deferred amounts may generate earnings for the 
Participant under the conditions of a separate plan providing for 
such as adopted by the Board. The Committee, in its sole 
discretion, may also define such other conditions of payment of 
earned Performance Awards as it may deem desirable in carrying out 
the purposes of the Plan.  

9.2   Terms of Performance Awards.

         (a)  Termination of Employment.  Unless otherwise provided 
below or in Section 9.3, in the case of a Participant's 
Termination of Employment prior to the end of an Award Period, the 
Participant will not have earned any Performance Awards. 

         (b)  Retirement.  If a Participant's Termination of 
Employment is because of retirement on a Normal Retirement Date or 
Other Retirement Date prior to the end of an Award Period, the 
Participant will not be paid any Performance Awards, unless the 
Committee, in its sole and exclusive discretion, determines that 
an Award should be paid.  In such a case, the Participant shall be 
entitled to receive a pro-rata portion of his or her Award as 
determined under Subsection (d).

         (c)  Death or Disability.  If a Participant's Termination 
of Employment is due to death or disability (as determined in the 
sole and exclusive discretion of the Committee) following at least 
twenty-four months of participation in any three year Award 
Period, but prior to the end of an Award Period, the Participant 
will be entitled to receive a pro-rata share of his or her Award 
as determined under Subsection (d).

         (d)  Pro-Rata Payment.  The amount of any payment made to a 
Participant whose employment is terminated by retirement, death or 
disability (under circumstances described in subsections (b) and 
(c)) will be the amount determined by multiplying the amount of 
the Performance Award which would have been earned, determined at 
the end of the Award Period, had such employment not been 
terminated by a fraction, the numerator of which is the number of 
whole months such Participant was employed during the Award 
Period, and the denominator of which is the number of months of 
the Award Period.  Any such payment made to a Participant whose 
employment is terminated prior to the end of an Award Period under 
this Section 9.2 shall be made at the end of the respective Award 
Period, unless otherwise determined by the Committee in its sole 
discretion.  Any partial payment previously made or credited to a 
deferred account for the benefit of a Participant as provided 
under Section 9.1(d) of the Plan shall be subtracted from the 
amount otherwise determined as payable as provided in this 
Section.

         (e)  Other Events.  Notwithstanding anything to the 
contrary in this Article IX, the Committee may, in its sole and 
exclusive discretion, determine to pay all or any portion of a 
Performance Award to a Participant who has terminated employment 
prior to the end of an Award Period under certain circumstances 
(including the death, disability or retirement of the Participant 
or a material change in circumstances arising after the Date of 
Grant) and subject to such terms and conditions as the Committee 
shall deem appropriate, provided that the Participant shall have 
completed, at his or her Termination of Employment, one year of 
employment after the Date of Grant.  The Board may determine to 
pay all or a part of a Performance Award to a Participant who has 
completed less than one year of employment after the Date of 
Grant.

9.3   Change in Control.  In the event of a Change in Control, a pro-
rata portion of Performance Awards for all Award Periods not yet completed 
shall immediately become fully payable to all Participants and shall be paid 
within 30 days after such Change in Control to Participants.  The pro-rata 
portion of each Performance Award shall be determined by multiplying 100 
percent of the targeted award by a fraction, the numerator of which is the 
number of whole months such Participant was employed during the Award Period 
as of the date of the Change in Control and the denominator of which is the 
total number of months in the Award Period.  All payments made with respect 
to Performance Awards on and after the date of Change in Control shall be 
made wholly in cash and shall be reduced by the amount of any previous 
prepayment or deferral with respect to the Award.  In the event a Participant 
remains in the employment of Unisys following a Change in Control through the 
end of any Award Period with respect to which a pro-rata portion of 
Performance Awards have been accelerated pursuant to this Section and the 
amounts payable as a result of the Company's reaching performance targets set 
forth in the Performance Award have exceeded the amounts paid to a 
Participant under this Section, a Participant shall be entitled to receive 
the difference between (x) the amount paid pursuant to this Section and (y) 
the amount otherwise payable at such time pursuant to the Award.

                                   ARTICLE X
                            OTHER STOCK-BASED AWARDS

10.1   Grant of Other Awards.  Other Awards of Company Common Stock or 
other securities of Unisys Corporation and other Awards that are valued in 
whole or in part by reference to, or are otherwise based on, Company Common 
Stock may be granted either alone or in addition to or in conjunction with 
other Awards under the Plan.  Subject to the provisions of the Plan, the 
Committee shall have sole and complete authority to determine the persons to 
whom and the time or times at which such Awards shall be made, the number of 
shares of Company Common Stock or other securities, if any, to be granted 
pursuant to such Awards, and all other conditions of the Awards.  Any such 
Award shall be confirmed by an Award Agreement executed by the Committee and 
the Participant, which Agreement shall contain such provisions as the 
Committee determines to be necessary or appropriate to carry out the intent 
of this Plan with respect to such Award.

10.2   Terms of Other Awards.  In addition to the terms and conditions 
specified in the Award Agreement, Awards made pursuant to this Article X 
shall be subject to the following:

         (a)  Any shares of Company Common Stock subject to Awards 
made under this Article X may not be sold, assigned, transferred, 
pledged or otherwise encumbered prior to the date on which the 
shares are issued, or, if later, the date on which any applicable 
restriction, performance or deferral period lapses; and

         (b)  If specified by the Committee in the Award Agreement, 
the recipient of an Award under this Article X shall be entitled 
to receive, currently or on a deferred basis, interest or 
dividends or dividend equivalents with respect to the Company 
Common Stock or other securities covered by the Award; and 

         (c)  The Award Agreement with respect to any Award shall 
contain provisions dealing with the disposition of such Award in 
the event of a Termination of Employment prior to the exercise, 
realization or payment of such Award, whether such termination 
occurs because of retirement, disability, death or other reason, 
with such provisions to take account of the specific nature and 
purpose of the Award.

                            ARTICLE XI
         TERMS APPLICABLE TO ALL AWARDS GRANTED UNDER THE PLAN

11.1   Plan Provisions Control Award Terms.  The terms of the Plan shall 
govern all Awards granted under the Plan, and in no event shall the Committee 
have the power to grant any Award under the Plan which is contrary to any of 
the provisions of the Plan.  In the event any provision of any Award granted 
under the Plan shall conflict with any term in the Plan as constituted on the 
Date of Grant of such Award, the term in the Plan as constituted on the Date 
of Grant of such Award shall control.  Except as provided in Section 11.3, 
the terms of any Award granted under the Plan may not be changed after the 
Date of Grant of such Award so as to materially decrease the value of the 
Award without the express approval of the holder.

11.2   Award Agreement.  No person shall have any rights under any Award 
granted under the Plan unless and until Unisys and the Participant to whom 
such Award shall have been granted shall have executed and delivered an Award 
Agreement or other Award acknowledgment expressly granting the Award to such 
person and containing provisions setting forth the terms of the Award.  

11.3   Modification of Award After Grant.  No Award granted under the 
Plan to a Participant may be modified (unless such modification does not 
materially decrease the value of the Award) after the date of its grant 
unless by express written agreement between Unisys and the Participant or 
Transferee provided that any such change (a) shall not be inconsistent with the 
terms of the Plan, and (b) shall be approved by the Committee.  No modifications
may be made to any Awards granted to a Participant while the Participant or 
Transferee is subject to Section 16(b) of the Exchange Act except in 
compliance with Rule 16b-3.

11.4   Limitations on Transfer.  Except as provided in Section 7.1(c) and 
this Section 11.4, a Participant's or Transferee's rights and interest under 
the Plan may not be assigned or transferred other than by will or the laws of 
descent and distribution, and during the lifetime of a Participant or 
Transferee, only the Participant or Transferee personally (or the 
Participant's or Transferee's personal representative) may exercise rights 
under the Plan.  The Participant's or Transferee's Beneficiary may exercise 
the Participant's or Transferee's rights to the extent they are exercisable 
under the Plan following the death of the Participant or Transferee.  The 
Committee, in its discretion, may allow some or all Non-Qualified Stock 
Options of some or all Participants to be transferable subject to limitations 
set forth in the Award Agreement.

11.5   Taxes.  Except as otherwise provided in Section 7.1(d) with respect to 
Restricted Share Awards, Unisys shall be entitled, if the Committee deems it 
necessary or desirable, to withhold (or secure payment from the Participant 
in lieu of withholding) the amount of any withholding or other tax required 
by law to be withheld or paid by Unisys with respect to any amount payable 
and/or shares issuable under such Participant's Award, or with respect 
to any income recognized upon a disqualifying disposition of shares received 
pursuant to the exercise of an Incentive Stock Option, and Unisys may defer 
payment or issuance of the cash or stock upon exercise or vesting of an Award 
unless indemnified to its satisfaction against any liability for any such 
tax.  The amount of such withholding or tax payment shall be determined by 
the Committee and shall be payable by the Participant at the time of issuance 
or payment (except as otherwise payable under Section 11.5(c)) in accordance 
with the following rules:  

         (a)  Unless otherwise provided by the Committee, with 
respect to Participants who are subject to the provisions of 
Section 16(b) of the Exchange Act on the date on which the 
withholding requirements apply, Unisys shall withhold from such 
Award the appropriate number of shares of Company Common Stock, 
rounded up to the next whole number, whose Fair Market Value is 
equal to such amount, or, in the case of a cash payment, the 
amount of cash, as is determined by Unisys to be sufficient to 
satisfy applicable tax withholding requirements; 

         (b)  With respect to Participants who are not subject to 
the provisions of Section 16(b) of the Exchange Act on the date on 
which the withholding requirements apply, the Participants shall 
have the right to elect to meet his or her withholding requirement 
through the method described in Subsection (a) above or by direct 
payment to Unisys of the amount of any taxes required to be 
withheld with respect to such Award; provided however, that the 
payment of withholding requirements with respect to Restricted 
Share Awards shall be governed solely by the provisions of Section 
7.1(d).

         (c)  Election to be Taxed at Date of Grant.

              If permitted under applicable Federal income tax laws, a 
Participant may elect to be taxed in the year in which an Award is made.  If 
the Participant makes such an election, the Participant shall promptly notify 
Unisys in writing and shall provide Unisys with a copy of the executed 
election form as filed with the Internal Revenue Service by no later than 
thirty days from the Date of the Grant.  Promptly following such 
notification, the Participant shall pay directly to Unisys the cash amount 
determined by Unisys to be sufficient to satisfy applicable federal, state or 
local withholding tax requirements.

11.6   Modification for Overseas Participants.  Notwithstanding any 
provision to the contrary, the Committee may incorporate such provisions, or 
make such modifications or amendments in Award Agreements of Participants who 
reside or are employed outside of the United States of America, or who are 
citizens of a country other than the United States of America, as the 
Committee deems necessary or appropriate to accomplish the purposes of the 
Plan with respect to such Participant in light of differences in applicable 
law, tax policies or customs, and to ascertain compliance with all applicable 
laws.  

11.7   Special Provisions for Certain Non-Employees.  Notwithstanding any 
provision herein to the contrary, the Committee may grant Awards under the 
Plan to non-employees who, in the judgment of the Committee, render 
significant services to Unisys or any of its Subsidiaries, on such terms and 
conditions as the Committee deems appropriate and consistent with the intent 
of the Plan.

11.8   Surrender of Awards.  Any Award granted under the Plan may be 
surrendered to Unisys for cancellation on such terms as the Committee and 
holder approve. 

11.9   Adjustments to Reflect Capital Changes.  

         (a)  Recapitalization.  The number and kind of shares 
subject to outstanding Awards, the Purchase Price or Exercise 
Price for such shares, and the number and kind of shares available 
for Awards subsequently granted under the Plan shall be 
appropriately adjusted to reflect any stock dividend, stock split, 
combination or exchange of shares, merger, consolidation or other 
change in capitalization with a similar substantive effect upon 
the Plan or the Awards granted under the Plan.  The Committee 
shall have the power to determine the amount of the adjustment to 
be made in each case.

         (b)  Sale or Reorganization.  After any reorganization, 
merger or consolidation in which Unisys is the surviving 
corporation, each Participant shall, at no additional cost, be 
entitled upon any exercise of an Option or receipt of other Award 
to receive (subject to any required action by shareholders), in 
lieu of the number of shares of Company Common Stock receivable or 
exercisable pursuant to such Award, the number and class of shares 
of stock or other securities to which such Participant would have 
been entitled pursuant to the terms of the reorganization, merger 
or consolidation if, at the time of such reorganization, merger or 
consolidation, such Participant had been the holder of record of a 
number of shares of stock equal to the number of shares receivable 
or exercisable pursuant to such Award.  Comparable rights shall 
accrue to each Participant in the event of successive 
reorganizations, mergers or consolidations of the character 
described above.

         (c)  Options to Purchase Stock of Acquired Companies.  
After any reorganization, merger or consolidation in which Unisys 
or a Subsidiary of Unisys shall be a surviving corporation, the 
Committee may grant substituted options under the provisions of 
the Plan, pursuant to Section 425 of the Code, replacing old 
options granted under a plan of another party to the 
reorganization, merger or consolidation whose stock subject to the 
old options may no longer be issued following such merger or 
consolidation.  The foregoing adjustments and manner of 
application of the foregoing provisions shall be determined by the 
Committee in its sole discretion.  Any such adjustments may 
provide for the elimination of any fractional shares which might 
otherwise become subject to any Options.

11.10  No Right to Employment.  No employee or other person shall have 
any claim of right to be granted an Award under this Plan.  Either the Plan 
or any action taken hereunder shall be construed as giving any employee any 
right to be retained in the employ of Unisys or any of its Subsidiaries.

11.11  Awards Not Includable for Benefit Purposes.  Payments received by 
a Participant pursuant to the provisions of the Plan shall not be included in 
the determination of benefits under any pension, group insurance or other 
benefit plan applicable to the Participant which are maintained by Unisys or 
any of its Subsidiaries, except as may be determined by the Board.

11.12  Governing Law.  All determinations made and actions taken pursuant 
to the Plan shall be governed by the laws of the Commonwealth of Pennsylvania 
and construed in accordance therewith.

11.13  No Strict Construction.  No rule of strict construction shall be 
implied against Unisys, the Committee, or any other person in the 
interpretation of any of the terms of the Plan, any Award granted under the 
Plan or any rule or procedure established by the Committee.

11.14  Compliance with Rule 16b-3.  It is intended that the Plan be 
applied and administered in compliance with Rule 16b-3.  If any provision of 
the Plan would be in violation of Rule 16b-3 if applied as written, such 
provision shall not have effect as written and shall be given effect so as to 
comply with Rule 16b-3, as determined by the Committee.  The Board is 
authorized to amend the plan and to make any such modifications to Award 
Agreements to comply with Rule 16b-3, as it may be amended from time to time, 
and to make any other such amendments or modifications as it deems necessary 
or appropriate to better accomplish the purposes of the Plan in light of any 
amendments made to Rule 16b-3.

11.15  Captions.  The captions (i.e., all underlined words) used in the 
Plan are for convenience only, do not constitute a part of the Plan, and 
shall not be deemed to limit, characterize or affect in any way any 
provisions of the Plan, and all provisions of the Plan shall be construed as 
if no captions have been used in the Plan.

11.16  Severability.  Whenever possible, each provision in the Plan and 
every Award at any time granted under the Plan shall be interpreted in such 
manner as to be effective and valid under applicable law, but if any 
provision of the Plan or any Award at any time granted under the Plan shall 
be held to be prohibited by or invalid under applicable law, then (a) such 
provision shall be deemed amended to accomplish the objectives of the 
provision as originally written to the fullest extent permitted by law and 
(b) all other provisions of the Plan and every other Award at any time 
granted under the Plan shall remain in full force and effect.  

11.17  Amendment and Termination.  

         (a)  Amendment.  The Board shall have complete power and 
authority to amend the Plan at any time and to add any other stock 
award or other incentive compensation programs to the Plan as it 
deems necessary or appropriate and no approval by the stockholders 
of Unisys or by any other person, committee or entity of any kind 
shall be required to make any amendment; provided, however, that 
the Board shall not, without the requisite affirmative approval of 
stockholders of Unisys, make any amendment which requires 
shareholder approval under Rule 16b-3 or the Code, unless such 
compliance is no longer desired, or under any other applicable 
law.  No termination or amendment of the Plan may, without the 
consent of the Participant to whom any Award shall theretofore 
have been granted under the Plan or without the consent of a 
Transferee, adversely affect the right of such individual under 
such Award.  For the purposes of this section, an amendment to the 
Plan shall be deemed to have the affirmative approval of the 
stockholders of Unisys if such amendment shall have been submitted 
for a vote by the stockholders at a duly called and constituted 
meeting of such stockholders at which a quorum is present and a 
majority of the votes cast with respect to such amendment at such 
meeting shall have been cast in favor of such amendment.

         (b)  Termination.  The Board shall have the right and the 
power to terminate the Plan at any time.  No Award shall be 
granted under the Plan after the termination of the Plan, but the 
termination of the Plan shall not have any other effect and any 
Award outstanding at the time of the termination of the Plan may 
be exercised after termination of the Plan at any time prior to 
the expiration date of such Award to the same extent such Award 
would have been exercisable had the Plan not terminated.


September 22, 2000




                      UNISYS DIRECTORS STOCK OPTION PLAN


                                   ARTICLE I
                         Purpose and Adoption of the Plan
                         ---------------------------------

     1.1     PURPOSE.  The Unisys Directors Stock Option Plan (the "Plan") is 
established as a sub-plan to the 1990 Unisys Long-Term Incentive Plan.  The 
purpose of the Plan is to assist in attracting and retaining highly qualified 
individuals to serve as outside directors of Unisys, to reward outside 
directors for their service to Unisys and to act as an incentive in 
motivating the outside directors to achieve long-term objectives of Unisys 
and its shareholders.  

     1.2     ADOPTION AND TERM.  The Plan has been approved by the Board and 
is effective as of January 1, 2000, and will remain in effect until 
terminated or abandoned by action of the Board.  

                                  ARTICLE II
                                  Definitions
                                  -----------

     2.1     "Adjusted Fair Market Value" means, in the event of a Change in 
Control, the greater of (i) the highest Fair Market Value of a share of 
Company Common Stock during the sixty day period ending on the date of such 
Change in Control or (ii) in the case of a Change in Control described in 
Section 2.7(a) or 2.7(c), the highest price per share of Company Common Stock 
paid to holders of Company Common Stock in any transaction (or series of 
transactions) constituting or resulting from such Change in Control.


     2.2     "Award" shall mean the grant of an Option made under the terms 
of the Plan.

     2.3     "Award Agreement" means a written agreement between the Company 
and a Participant or a written acknowledgement from the Company specifically 
setting forth the terms and conditions of an Award granted under the Plan.

     2.4     "Beneficiary" means an individual, trust or estate who or which 
by designation of the Participant or Transferee or operation of law succeeds 
to the rights and obligations of the Participant or Transferee under the Plan 
and Award Agreement upon the Participant's or Transferee's death.

     2.5     "Board" means the Board of Directors of Unisys.  

     2.6     "Change in Control" means any of the following events:

               (a)  The acquisition by any individual, entity or 
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities 
Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of 
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 
Exchange Act) of 20% or more of either (i) the then outstanding shares of 
common stock of the Company (the "Outstanding Company Common Stock") or (ii) 
the combined voting power of the then outstanding voting securities of the 
Company entitled to vote generally in the election of directors (the 
"Outstanding Company Voting Securities"); provided, however, that for 
purposes of this subsection (a), the following acquisitions shall not 
constitute a Change of Control: (i) any acquisition directly from the 
Company, (ii) any acquisition by the Company, (iii) any acquisition by any 
employee benefit plan (or related trust) sponsored or maintained by the 
Company or any corporation controlled by the Company or (iv) any acquisition 
by any corporation pursuant to a transaction which complies with clauses (i), 
(ii) and (iii) of subsection (c) of this Section 2.07; or

               (b)  Individuals who, as of May 25, 1995, constitute the Board 
(the "Incumbent Board") cease for any reason to constitute at least a 
majority of the Board; provided, however, that any individual becoming a 
director subsequent to the date hereof whose election, or nomination for 
election by the Company's shareholders, was approved by a vote of at least a 
majority of the directors then comprising the Incumbent Board shall be 
considered as though such individual were a member of the Incumbent Board, 
but excluding, for this purpose, any such individual whose initial assumption 
of office occurs as a result of an actual or threatened election contest with 
respect to the election or removal of directors or other actual or threatened 
solicitation of proxies or consents by or on behalf of a Person other than 
the Board; or

               (c)  Consummation of a reorganization, merger or consolidation 
or sale or other disposition of all or substantially all of the assets of the 
Company (a "Business Combination"), in each case, unless, following such 
Business Combination, (i) all or substantially all of the individuals and 
entities who were the beneficial owners, respectively, of the Outstanding 
Company Common Stock and Outstanding Company Voting Securities immediately 
prior to such Business Combination beneficially own, directly or indirectly, 
more than 50% of, respectively, the then outstanding shares of common stock 
and the combined voting power of the then outstanding voting securities 
entitled to vote generally in the election of directors, as the case may be, 
of the corporation resulting from such Business Combination (including, 
without limitation, a corporation which as a result of such transaction 
owns the Company or all or substantially all of the Company's assets either 
directly or through one or more subsidiaries) in substantially the same 
proportions as their ownership, immediately prior to such Business 
Combination of the Outstanding Company Common Stock and Outstanding Company 
Voting Securities, as the case may be, (ii) no Person (excluding any 
corporation resulting from such Business Combination or any employee benefit 
plan (or related trust) of the Company or such corporation resulting from 
such Business Combination) beneficially owns, directly or indirectly, 20% or 
more of, respectively, the then outstanding shares of common stock of the 
corporation resulting from such Business Combination or the combined voting 
power of the then outstanding voting securities of such corporation except to 
the extent that such ownership existed prior to the Business Combination and 
(iii) at least a majority of the members of the board of directors of the 
corporation resulting from such Business Combination were members of the 
Incumbent Board at the time of the execution of the initial agreement, or of 
the action of the Board, providing for such Business Combination; or

               (d)  Approval by the shareholders of the Company of a complete 
liquidation or dissolution of the Company.

     2.7     "Code" means the Internal Revenue Code of 1986, as amended.  
References to a section of the Code shall include that section and any 
comparable section or sections of any future legislation that amends, 
supplement or supersedes said section.

     2.8     "Committee" means the Corporate Governance and Compensation 
Committee of the Board.

     2.9     "Company Common Stock" means the common stock of Unisys, par 
value $.01 per share.

     2.10     "Company Voting Securities" means the combined voting power of 
all outstanding voting securities of Unisys entitled to vote generally in the 
election of directors for the Board.

     2.11     "Date of Grant" means the date designated by the Committee as 
the date as of which it grants an Award, which shall not be earlier than the 
date on which the Committee approves the granting of such Award.  

     2.12     "Exchange Act" means the Securities Exchange Act of 1934, as 
amended.

     2.13     "Fair Market Value" means, on any date, the average of the high 
and low quoted sales prices of a share of Company Common Stock, sold regular 
way, through the official close of the New York Stock Exchange at 4:00 p.m. 
U.S. Eastern Standard Time  on such date or, if there were no sales on such 
date, on the last date preceding such date on which a sale was reported.

     2.14     "Incumbent Board" means the Board as of May 25, 1995. 

     2.15     "Non-Qualified Stock Option" means a stock option that is not 
an incentive stock option within the meaning of Section 422A of the Code.

     2.16     "Option" means a Non-Qualified Stock Option granted under the 
Plan.

     2.17     "Outstanding Company Common Stock" means, at any time, the 
issued and outstanding shares of Company Common Stock. 

     2.18     "Participant" shall have the meaning set forth in Section 5.1.

     2.19     "Plan" shall mean the Unisys Directors Stock Option Plan as 
described herein and as may be amended from time to time.

     2.20     "Purchase Price", with respect to Options, shall have the 
meaning set forth in Section 6.1(b).

     2.21     "Rule 16b-3" means Rule 16b-3 promulgated by the Securities and 
Exchange Commission under Section 16 of the Exchange Act, as it may be 
amended from time to time, and any successor rule.  

     2.22     "Subsidiary" shall have the meaning set forth in Section 425(f) 
of the Code.  

     2.23     "Termination of Service" means the voluntary or involuntary 
termination of a Participant's service as a director of Unisys for any 
reason, including death, disability or retirement.  Whether a Termination of 
Service is a result of disability shall be determined in each case by the 
Committee in its sole discretion. 

     2.24     "Transferee" means the holder of Non-Qualified Stock Option 
after a transfer in accordance with Section 7.4.

     2.25     "Unisys" means Unisys Corporation, a Delaware corporation.

                                  ARTICLE III
                                 Administration
                                 --------------

     3.1     COMMITTEE.  The Plan shall be administered by the Committee.  
The Committee shall be selected from time to time by the Board, and shall be 
comprised of not less than three members of the Board or such other persons 
who would constitute "Non-Employee Directors" under the requirements of Rule 
16b-3.  The Committee shall have exclusive and final authority in each 
determination, interpretation or other action affecting the Plan and its 
Participants.  The Committee shall have the sole discretionary authority to 
interpret the Plan, and to take such steps in connection with the Plan and 
Awards granted as it may deem necessary or advisable.  With Board 
ratification, the Committee may cancel Awards and substitute new Options for 
underwater Options with the consent of the recipient and under such terms as 
it deems appropriate.

                                  ARTICLE IV
                          Shares Issued Under Awards
                          ---------------------------

     4.1     SHARES AVAILABLE FOR ISSUANCE.  The shares issued as a result of 
the grant of Awards under this Plan shall be issued from the shares available 
for awards made under the terms of the 1990 Unisys Long-Term Incentive Plan.

     4.2     SHARES SUBJECT TO TERMINATED AWARDS.  The shares of Company 
Common Stock involved in any unexercised portions of terminated Options 
(including cancelled Options) granted under the Plan may again be subject to 
Awards under the Plan or the 1990 Unisys Long-Term Incentive Plan. 

                                   ARTICLE V
                                  Participants
                                  ------------

     5.1     ELIGIBLE PARTICIPANTS.  Participants in the Plan eligible to 
receive Awards shall be those members of the Board who are not employees of 
Unisys.

                                  ARTICLE VI
                                 Stock Options 
                                ---------------

     6.1     OPTION AWARDS.  

               (a)     The Committee may grant, to such Participants as the 
Committee may select, Options entitling the Participant or Transferee to 
purchase Company Common Stock from Unisys in such quantity, at such price, 
and on such terms and subject to such conditions, not inconsistent with the 
terms of this Plan, as may be established by the Committee.  The terms of any 
Stock Option granted under this Plan shall be set forth in an Award 
Agreement.  All Awards made by the Committee under the Plan will be subject 
to ratification by the Board.

              (b)     PURCHASE PRICE OF OPTIONS.  The Purchase Price of each 
share of Company Common Stock which may be purchased upon exercise of any 
Option granted under the Plan shall be determined by the Committee, provided 
that such Purchase Price shall be not less than 50% of the Fair Market Value 
on the Date of Grant

               (c)     RIGHTS AS A STOCKHOLDER.  A Participant or Transferee 
shall have no rights as a stockholder with respect to any shares of Company 
Common Stock covered by an Option until the Participant or Transferee shall 
have become the holder of record or beneficial owner of any such shares, and 
no adjustment shall be made for dividends in cash or other property or 
distributions or other rights with respect to any such shares of Company 
Common Stock for which the record date is prior to the date on which the 
Participant or Transferee shall have become the holder of record or 
beneficial owner of any such shares covered by the Option.

     6.2     TERMS OF STOCK OPTIONS.

               (a)     CONDITIONS ON EXERCISE.  An Award Agreement with 
respect to Options may contain such waiting periods, exercise dates and 
restrictions on exercise (including, but not limited to, periodic 
installments which may be cumulative) as may be determined by the Committee 
at the time of grant.  Unless otherwise authorized by the Board, no Stock 
Option may be exercised in whole or in part prior to one year from the Date 
of Grant, except as set forth in Section 6.4. 

               (b)     DURATION OF OPTIONS.  Options shall terminate after 
the first to occur of the following events:  

                  (1)   Expiration of the Option as provided in the Award 
Agreement; or

                  (2)   Termination of the Award as provided in Section 
6.2(e), following the Participant's Termination of Service.

               (c)     ACCELERATION OF EXERCISE TIME.  The Committee, in its 
sole discretion, shall have the right (but shall not in any case be 
obligated) to permit purchase of shares under any Option prior to the time 
such Option would otherwise become exercisable under the terms of the Award 
Agreement, except that the acceleration of exercise prior to one year from 
the Date of Grant must be approved by the Board.

               (d)     EXTENSION OF EXERCISE TIME.  In addition to the 
extensions permitted under Section 6.2(e) in the event of Termination of 
Service, the Committee, in its sole discretion, shall have the right (but 
shall not in any case be obligated) to permit any Option granted under this 
Plan to be exercised after its expiration date described in Section 6.2(e), 
subject, however to the limitations described in Section 6.2(b)(1).

               (e)     EXERCISE OF OPTIONS UPON TERMINATION OF SERVICE.

                  (1)   TERMINATION WITH LESS THAN FIVE YEARS OF SERVICE.  In 
the event of Termination of Service of a Participant who had not served on 
the Board for at least five years for a reason other than death or 
disability, to the extent the right to exercise the Option had accrued at the 
date of Termination of Service, the right of the Participant or Transferee to 
exercise the Option under the Plan shall terminate at the date of such 
Termination of Service, unless otherwise provided by the Committee in 
accordance with Section 6.2(d).  Options, or any portion thereof, that had 
not become exercisable as of the date of such Termination of Service shall 
expire as of such date.

                        (A)   DISABILITY.  Upon a Participant's Termination 
of Service by reason of disability prior to the date on which the Participant 
completes five years of service, the Participant or Transferee may, within 
five years after the Termination of Service, exercise all or any part of his 
or her Options which were exercisable upon such Termination of Service.  In 
no event, however, may any Option be exercised later than the date described 
in Section 6.2(b)(1).  Options, or any portion thereof, that had not become 
exercisable as of the date of such Termination of Service shall expire as of 
such date.

                        (B)   DEATH.  In the event of the death of a 
Participant while serving as a director of Unisys or within the additional 
period of time from the date of Termination of Service and prior to the 
expiration of the Option as permitted in Section 6.2(e)(1)(A) or Section 
6.2(e)(2), to the extent the right to exercise the Option accrued as of the 
date of such Termination of Service or thereafter and did not expire during 
such additional period and prior to the Participant's death, the right of the 
Participant's Beneficiary or Transferee to exercise the Option under the Plan 
shall expire upon the earliest of (i) five years from the date of the 
Participant's death or (ii) five years from the date of the Participant's 
Termination of Service or (iii) the date of expiration of the Option 
determined pursuant to Section 6.2(b)(1).  Options, or any portion thereof, 
that had not become exercisable as of the date of the Participant's death 
shall expire as of the date of death.

                  (2)   TERMINATION OF SERVICE WITH FIVE YEARS OF SERVICE.  
If a Participant terminates service after completing five years of service as 
a director of Unisys,

                        (A)   to the extent that the right to exercise an 
Option, or any portion thereof, has not accrued as of the date of Termination 
of Service, the Participant or Transferee shall continue to vest in the 
Option after Termination of Service in accordance with the vesting schedule 
contained in the applicable Award Agreement, and

                        (B)   the Participant or Transferee may exercise the 
Option, to the extent the right to exercise has accrued as of the date of 
Termination of Service or thereafter in accordance with Section 6.2(e)(2)(A), 
within five years of the date of the Participant's Termination of Service, 
provided in no event may any Option be exercised later than the date 
described in Section 6.2(b)(1).

     6.3     EXERCISE PROCEDURES.  Each Option granted under the Plan shall 
be exercised by written notice to Unisys which must be received by the office 
of Unisys designated in the Award Agreement on or before the expiration date 
of the Award.  The Purchase Price of shares purchased upon exercise of an 
Option granted under the Plan shall be paid in full in cash by the 
Participant or Transferee pursuant to the Award Agreement; provided, however, 
that the Committee may (but need not) permit payment to be made by delivery 
to Unisys of either (a) shares of Company Common Stock (which may include 
shares issued in connection with the exercise of the Option, subject to such 
rules as the Committee deems appropriate) or (b) any combination of cash and 
shares of Company Common Stock, or (c) such other consideration as the 
Committee deems appropriate and in compliance with applicable law (including 
payment in accordance with a cashless exercise program under which, if so 
instructed by the Participant or Transferee, shares of Company Common Stock 
may be issued directly to the Participant's or Transferee's broker or dealer 
upon receipt of the Purchase Price in cash from the broker or dealer.)  In 
the event that any Company Common Stock shall be transferred to Unisys to 
satisfy all or any part of the Purchase Price, the part of the Purchase Price 
deemed to have been satisfied by such transfer of Company Common Stock shall 
be equal to the product derived by multiplying the Fair Market Value as of 
the date of exercise times the number of shares transferred.  The Participant 
or Transferee may not transfer to Unisys in satisfaction of the Purchase 
Price (y) a number of shares which when multiplied times the Fair Market 
Value as of the date of exercise would result in a product greater than the 
Purchase Price or (z) any fractional share of Company Common Stock. Any part 
of the Purchase Price paid in cash upon the exercise of any Option shall be 
added to the general funds of Unisys and be used for any proper corporate 
purpose.  Unless the Committee shall otherwise determine, any Company Common 
Stock transferred to Unisys as payment of all or part of the Purchase Price 
upon the exercise of any Option shall be held as treasury shares.

     6.4     CHANGE IN CONTROL.  In the event of a Change in Control, (1) all 
Options outstanding on the date of such Change in Control shall become 
immediately and fully exercisable, and (2) a Participant will be permitted to 
surrender for cancellation within sixty days after such Change in Control any 
Option or portion of an Option to the extent not yet exercised (or with 
respect to an Option or portion of an Option granted less than six months 
prior to the date of the Change in Control, within sixty days after the 
expiration of a six month period following the Date of Grant) and to receive 
a cash payment in an amount equal to the excess, if any, of (A) the Adjusted 
Fair Market Value of the Company Common Stock subject to the Option or a 
portion thereof surrendered, over (B) the Purchase Price.  The provisions of 
this Section 6.4 shall not be applicable to any Options granted to a 
Participant if any Change in Control results from such Participant's 
beneficial ownership (within the meaning of Rule 13d(3) under the Exchange 
Act) of Company Common Stock or Company Voting Securities.

                                ARTICLE VII
            Terms Applicable to All Awards Granted Under the Plan
            -----------------------------------------------------

     7.1     PLAN PROVISIONS CONTROL AWARD TERMS.  The terms of the Plan 
shall govern all Awards granted under the Plan, and in no event shall the 
Committee have the power to grant any Award under the Plan which is contrary 
to any of the provisions of the Plan.  In the event any provision of any 
Award granted under the Plan should conflict with any term in the Plan as 
constituted on the Date of Grant of such Award, the term in the Plan as 
constituted on the Date of Grant of such Award shall control.  Except as 
provided in Section 7.3, the terms of any Award granted under the Plan may 
not be changed after the Date of Grant of such Award so as to materially 
decrease the value of the Award without the express approval of the holder.

     7.2     AWARD AGREEMENT.  No person shall have any rights under any 
Award granted under the Plan unless and until Unisys and the Participant to 
whom such Award shall have been granted shall have executed and delivered an 
Award Agreement or other Award acknowledgment expressly granting the Award to 
such person and containing provisions setting forth the terms of the Award.  

     7.3     MODIFICATION OF AWARD AFTER GRANT.  No Award granted under the 
Plan to a Participant may be modified (unless such modification does not 
materially decrease the value of the Award) after the date of its grant 
unless by express written agreement between Unisys and the Participant or 
Transferee provided that any such change (a) shall not be inconsistent with 
the terms of the Plan, and (b) shall be approved by the Committee.  No 
modifications may be made to any Awards granted to a Participant while the 
Participant or Transferee is subject to Section 16(b) of the Exchange Act 
except in compliance with Rule 16b-3.

     7.4     LIMITATIONS ON TRANSFER.  A Participant's or Transferee's rights 
and interest under the Plan may not be assigned or transferred other than by 
will or the laws of descent and distribution, and during the lifetime of a 
Participant or Transferee, only the Participant or Transferee personally (or 
the Participant's or Transferee's personal representative) may exercise 
rights under the Plan.  The Participant's or Transferee's Beneficiary may 
exercise the Participant's or Transferee's rights to the extent they are 
exercisable under the Plan following the death of the Participant or 
Transferee.  The Committee, in its discretion, may allow some or all Non-
Qualified Stock Options of some or all Participants to be transferable 
subject to limitations set forth in the Award Agreement.

     7.5     TAXES.  Unisys shall be entitled, if the Committee deems it 
necessary or desirable, to withhold (or secure payment from the Participant 
in lieu of withholding) the amount of any withholding or other tax required 
by law to be withheld or paid by Unisys with respect to any amount payable 
and/or shares issuable under such Participant's Award, and Unisys may defer 
payment or issuance of the cash or stock upon exercise of an Award unless 
indemnified to its satisfaction against any liability for any such tax.  The 
amount of such withholding or tax payment shall be determined by the 
Committee and shall be payable by the Participant at the time of issuance or 
payment

     7.6     SURRENDER OF AWARDS.  Any Award granted under the Plan may be 
surrendered to Unisys for cancellation on such terms as the Committee and 
holder approve. 

     7.9     ADJUSTMENTS TO REFLECT CAPITAL CHANGES.  

               (a)     RECAPITALIZATION.  The number and kind of shares 
subject to outstanding Awards, the Purchase Price or Exercise Price for such 
shares, and the number and kind of shares available for Awards subsequently 
granted under the Plan shall be appropriately adjusted to reflect any stock 
dividend, stock split, combination or exchange of shares, merger, 
consolidation or other change in capitalization with a similar substantive 
effect upon the Plan or the Awards granted under the Plan.  The Committee 
shall have the power to determine the amount of the adjustment to be made in 
each case.

               (b)     SALE OR REORGANIZATION.  After any reorganization, 
merger or consolidation in which Unisys is the surviving corporation, each 
Participant shall, at no additional cost, be entitled upon any exercise of an 
Option to receive (subject to any required action by shareholders), in lieu 
of the number of shares of Company Common Stock receivable or exercisable 
pursuant to such Award, the number and class of shares of stock or other 
securities to which such Participant would have been entitled pursuant to the 
terms of the reorganization, merger or consolidation if, at the time of such 
reorganization, merger or consolidation, such Participant had been the holder 
of record of a number of shares of stock equal to the number of shares 
receivable or exercisable pursuant to such Award.  Comparable rights shall 
accrue to each Participant in the event of successive reorganizations, 
mergers or consolidations of the character described above.

               (c)     OPTIONS TO PURCHASE STOCK OF ACQUIRED COMPANIES.  
After any reorganization, merger or consolidation in which Unisys or a 
Subsidiary of Unisys shall be a surviving corporation, the Committee may 
grant substituted options under the provisions of the Plan, pursuant to 
Section 425 of the Code, replacing old options granted under a plan of 
another party to the reorganization, merger or consolidation whose stock 
subject to the old options may no longer be issued following such merger or 
consolidation.  The foregoing adjustments and manner of application of the 
foregoing provisions shall be determined by the Committee in its sole 
discretion.  Any such adjustments may provide for the elimination of any 
fractional shares, which might otherwise become subject to any Options.

     7.7     GOVERNING LAW.  All determinations made and actions taken 
pursuant to the Plan shall be governed by the laws of the Commonwealth of 
Pennsylvania and construed in accordance therewith.

     7.8     NO STRICT CONSTRUCTION.  No rule of strict construction shall be 
implied against Unisys, the Committee, or any other person in the 
interpretation of any of the terms of the Plan, any Award granted under the 
Plan or any rule or procedure established by the Committee.

     7.9     COMPLIANCE WITH RULE 16B-3.  It is intended that the Plan be 
applied and administered in compliance with Rule 16b-3.  If any provision of 
the Plan would be in violation of Rule 16b-3 if applied as written, such 
provision shall not have effect as written and shall be given effect so as to 
comply with Rule 16b-3, as determined by the Committee.  The Board is 
authorized to amend the plan and to make any such modifications to Award 
Agreements to comply with Rule 16b-3, as it may be amended from time to time, 
and to make any other such amendments or modifications as it deems necessary 
or appropriate to better accomplish the purposes of the Plan in light of any 
amendments made to Rule 16b-3.

     7.10     CAPTIONS.  The captions (i.e., all underlined words) used in 
the Plan are for convenience only, do not constitute a part of the Plan, and 
shall not be deemed to limit, characterize or affect in any way any 
provisions of the Plan, and all provisions of the Plan shall be construed as 
if no captions have been used in the Plan.

     7.11     SEVERABILITY.  Whenever possible, each provision in the Plan 
and every Award at any time granted under the Plan shall be interpreted in 
such manner as to be effective and valid under applicable law, but if any 
provision of the Plan or any Award at any time granted under the Plan shall 
be held to be prohibited by or invalid under applicable law, then (a) such 
provision shall be deemed amended to accomplish the objectives of the 
provision as originally written to the fullest extent permitted by law and 
(b) all other provisions of the Plan and every other Award at any time 
granted under the Plan shall remain in full force and effect.  

     7.12     AMENDMENT AND TERMINATION.  

               (a)     AMENDMENT.  The Board shall have complete power and 
authority to amend the Plan at any time and to add any other stock award or 
other incentive compensation programs to the Plan as it deems necessary or 
appropriate and no approval by the stockholders of Unisys or by any other 
person, committee or entity of any kind shall be required to make any 
amendment.  No termination or amendment of the Plan may, without the consent 
of the Participant to whom any Award shall theretofore have been granted 
under the Plan or without the consent of a Transferee, adversely affect the 
right of such individual under such Award.  

               (b)     TERMINATION.  The Board shall have the right and the 
power to terminate the Plan at any time.  No Award shall be granted under the 
Plan after the termination of the Plan, but the termination of the Plan shall 
not have any other effect and any Award outstanding at the time of the 
termination of the Plan may be exercised after termination of the Plan at any 
time prior to the expiration date of such Award to the same extent such Award 
would have been exercisable had the Plan not terminated.




                      UNISYS CORPORATION
                  DEFERRED COMPENSATION PLAN
      (as amended and restated effective September 22, 2000)


                        ARTICLE I
                    PURPOSE & AUTHORITY


          1.1   PURPOSE.  The purpose of the Plan is to offer Eligible 
Executives the opportunity to defer receipt of a portion of their 
compensation from the Corporation, under terms advantageous to both the 
Eligible Executive and the Corporation.  

          1.2   EFFECTIVE DATE.  The Board originally approved the 
Officers' Plan on January 29, 1982.  The Plan has been amended and 
restated from time to time since its original adoption and, except to 
the extent specifically provided otherwise, this amended and restated 
version of the Plan is effective with respect to all amounts credited to 
a Participant's Account as of September 22, 2000 or any date thereafter.

          1.3   AUTHORITY.  Any decision made or action taken by the 
Corporation and any of its officers or employees involved in the 
administration of this Plan, or any member of the Board or the Committee 
arising out of or in connection with the construction, administration, 
interpretation and effect of the Plan shall be within the absolute 
discretion of all and each of them, as the case may be, and will be 
conclusive and binding on all parties.  No member of the
 Board and no 
employee of the Corporation shall be liable for any act or action 
hereunder, whether of omission or commission, by any other member or 
employee or by any agent to whom duties in connection with the 
administration of the Plan have been delegated or, except in 
circumstances involving the member's or employee's bad faith, for 
anything done or omitted to be done by himself or herself.


                          ARTICLE II
                          DEFINITIONS

          2.1   "Account" means, for any Participant, each memorandum 
account established for the Participant under Section 5.1.

          2.2   "Account Balance" means, for any Participant as of any 
date and with respect to any Account, the aggregate amount reflected in 
that Account.

          2.3   "Annual Incentive Pay" means, for any individual, the 
amount payable, if any, to such individual under the Unisys Executive 
Variable Compensation Plan (or under any successor annual incentive plan 
of the Corporation) or under any other similar annual incentive plan of 
the Corporation approved by the Vice President, Human Resources.

          2.4   "Beneficiary" means the person or persons designated 
from time to time in writing by a Participant to receive payments under 
the Plan after the death of such Participant or, in the absence of such 
designation or in the event that such designated person or persons 
predeceases the Participant, the Participant's estate.

          2.5   "Board" means the Board of Directors of the Corporation.

          2.6   "Committee" means the Corporate Governance and 
Compensation Committee of the Board, or such other committee as may be 
appointed by the Board to administer the Plan.

          2.7   "Corporation" means Unisys Corporation.

          2.8   "Corporation Contributions" means discretionary 
contributions that are made by the Corporation at any time based on 
individual or corporate performance or such other criteria as is deemed 
appropriate by the Corporation.

          2.9   "Corporation Contributions Account" means that portion 
of a Participant's Account to which any Corporation Contributions made 
under the Plan for him or her are credited.

          2.10  "Deferral Election" means an election by an Eligible 
Executive to defer a portion of his or her compensation from the 
Corporation under the Plan, as described in Section 3.1.

          2.11  "Directors' Plan" means the Deferred Compensation Plan 
for Directors of Unisys Corporation.

          2.12  "Eligible Executive" means, for any calendar year, an 
employee (a) whose base salary from the Corporation equals or exceeds 70 
percent (70%) of the maximum amount of compensation that is permitted to 
be taken into account under Section 401(a)(17) of the Internal Revenue 
Code and who is eligible to receive Annual Incentive Pay or sales 
commissions, (b) whose base salary from the Corporation equals or 
exceeds the maximum amount of compensation that is permitted to be taken 
into account under Section 401(a)(17) of the Internal Revenue Code, or 
(c) who satisfies any other eligibility criteria established by the 
Committee.

          2.13  "Fair Market Value" means, on any date, the  sales price 
of a share of Unisys Common Stock  as of the official close of the New 
York Stock Exchange at 4:00 p.m. US Eastern Standard Time. .

          2.14  "Investment Measurement Option" means any of the 
hypothetical investment alternatives available for determining the 
additional amounts to be credited to a Participant's Account under 
Section 5.2.  Effective January 1, 1997, the Investment Measurement 
Options available are all of the investment options available to 
eligible participants under the USP.  Performance Unit Compensation 
deferred under the Plan will be held as Stock Units.

          2.15  "Officers' Plan" means the Deferred Compensation Plan 
for Officers of Unisys Corporation, the predecessor of this Plan.

          2.16  "Option for Stock Units" means an option, created 
pursuant to a Participant's election in accordance with Section 3.2, 
that, if exercised by the Participant, will result in the crediting of 
Stock Units to the Participant's Account.

          2.17  "Participant" means an Eligible Executive or former 
Eligible Executive who has made a Deferral Election and who has not 
received a distribution of his or her entire Account Balance.

          2.18  "Performance Unit Compensation" means any amount payable 
to an Eligible Executive as a result of the Eligible Executive's vesting 
in a Performance Unit award (including, but not limited to, share unit 
and restricted share unit awards) made under the terms of the 1990 
Unisys Long-Term Incentive Plan, or any successor equity-based incentive 
compensation plan.

          2.19  "Plan" means the Unisys Corporation Deferred 
Compensation Plan, as set forth herein and as amended from time to time.

          2.20  "Revised Election" means an election made by a 
Participant, in accordance with Section 6.2, to change the date as of 
which payment of his or her Account Balance is to commence and/or the 
form in which such payment is to be made.

          2.21  "Stock Units" means Unisys common stock-equivalent 
units.  Each Stock Unit represents the equivalent of one share of Unisys 
common stock; therefore, the value of a Stock Unit on any given date is 
the Fair Market Value of a share of Unisys Common Stock on that date.  

          2.22  "USP" means the Unisys Savings Plan.

          2.23  "Valuation Date" means any business day as of which the 
interest of a Participant in each of the Participant's Accounts is 
valued. 

                               ARTICLE III
                         DEFERRAL OF COMPENSATION

          3.1   DEFERRAL ELECTION.

            (a)   During any calendar year, each individual who is an 
Eligible Executive for such calendar year may, by properly completing 
and filing a Deferral Election in the form and manner prescribed by the 
Committee (including properly completing a life insurance application if 
required by the Committee), elect to defer:

                  (1)  all or a portion of his or her salary that, 
absent deferral under this Plan but giving effect to any deferral or 
salary deduction election under any other plan maintained by the 
Corporation (other than the USP), would be paid to him or her for 
services rendered during the remainder of the current calendar year 
and/or the next following calendar year; and/or

                  (2)  up to seventy-five percent (75%) of his or her 
sales commissions that, absent deferral under this Plan but giving 
effect to any deferral or salary deduction election under any other plan 
maintained by the Corporation (other than the USP), would be paid to him 
or her during the remainder of the current calendar year and/or the next 
following calendar year; and

                  (3)  all or a portion of his or her Annual Incentive 
Pay that, absent deferral under this Plan, but giving effect to any 
deferral or salary deduction election under any other plan maintained by 
the Corporation (other than the USP), would be paid to him/her in the 
next following calendar year.

            (b)   To be effective, a Deferral Election with respect to 
salary, sales commissions and/or Annual Incentive Pay must be filed by 
the date specified by the Committee, or if no date is specified, by 
October 31 of the calendar year immediately preceding the calendar year 
in which the amounts to be deferred, absent deferral, would be paid to 
the Eligible Executive.  Notwithstanding the foregoing, an Eligible 
Executive may make a Deferral Election with respect to salary and/or 
sales commissions by filing a Deferral Election on or before the date 
that is at least three months and one day before the date on which the 
amounts to be deferred, absent deferral, would be paid to the Eligible 
Executive, provided, however, that an individual who becomes an Eligible 
Executive after the effective date of the Plan (as set forth in Section 
1.2) may make and file a Deferral Election on or before the date that is 
30 days after the date on which he or she becomes an Eligible Executive 
with respect to salary and/or sales commissions that, absent deferral, 
would be paid to him or her during the remainder of the calendar year in 
which he or she becomes an Eligible Executive, with such Deferral 
Election becoming effective as soon as administratively practicable.  

            (c)   In addition to the Deferral Elections described in 
Section 3.1(a), an Eligible Executive may make a Deferral Election with 
respect to Performance Unit Compensation that, absent deferral, would be 
paid to the Eligible Executive.  To be effective, a Deferral Election 
with respect to Performance Unit Compensation must be made in writing by 
the Eligible Executive on or before the date that is 12 months and one 
day before the date on which the amounts to be deferred, absent 
deferral, would be paid to the Executive.

            (d)   Once made, a Deferral Election shall become effective 
upon approval by the Corporate Executive Compensation Department and is 
thereafter irrevocable, except to the extent otherwise provided in 
Section 6.2.  A Deferral Election will be deemed to have been approved 
by the Corporate Executive Compensation Department if it is not 
disapproved by the Corporate Executive Compensation Department within 
ten days of the date on which it is received.

            (e)   An Eligible Executive's Deferral Election must specify 
either a percentage or a certain dollar amount of his or her salary, 
sales commissions, and/or Annual Incentive Pay, and/or a percentage of 
his or her Performance Unit Compensation, to be deferred under the Plan.  
In addition, the Deferral Election must specify the portion of the year, 
if less than the full year, to which the Deferral Election is to apply.  
Finally, the Deferral Election must specify the date on which payment of 
the Eligible Executive's Account Balance is to commence and the manner 
in which such payment is to be made.

                  (1)  The Eligible Executive must specify the date as 
of which payment of his or her Account Balance is to commence and may 
specify that such payment is to commence as of:

                       (A)  his or her termination of active employment 
(including as a result of retirement, onset of long term disability or 
other reason for termination) with the Corporation; or

                       (B)  a specific date (which may be determined by 
reference to the Eligible Executive's termination of employment by 
retirement or otherwise) that is at least two years after the end of the 
calendar year containing the date on which the amounts to be deferred, 
absent deferral, would be paid to the Eligible Executive.

                  (2)  The Eligible Executive must specify the manner in 
which payment of his or her Account Balance is to be made and may 
specify that such payment is to be made either in a single sum or in 
annual installments.  If the Eligible Executive is still employed when 
such distributions commence, then annual installments  may not be for a 
period shorter than 2 years nor longer than 5 years.

                  (3)  Notwithstanding the foregoing, an Eligible 
Executive may not elect a time of benefit commencement and/or a form of 
payment to the extent that such an election would cause any payments to 
be made after the March 31 first following the date that is 20 years 
after the date of the Eligible Executive's termination of employment (by 
retirement or otherwise).

            (f)   Deferrals of an Eligible Executive's salary shall be 
credited to the Plan ratably throughout the year (or, where applicable, 
the portion of the year) to which the Deferral Election applies.  
Deferrals of an Eligible Executive's Annual Incentive Pay and 
Performance Unit Compensation shall be credited in a single sum.  Any 
deferral will be credited to the Plan as soon as administratively 
practicable after the date on which the amount, absent deferral, would 
be payable to the Participant.

            (g)   A Deferral Election with respect to salary shall 
expire as of the last day of the calendar year that includes the first 
day on which any amount, absent deferral, would be paid to the Eligible 
Executive and a Deferral Election with respect to Annual Incentive Pay 
or Performance Unit Compensation shall expire as of the date on which 
the Annual Incentive Pay or Performance Unit Compensation that is the 
subject of the Deferral Election is credited under the Plan.

          3.2   OPTIONS FOR STOCK UNITS.  A Participant who holds an 
option for Corporation common stock that was awarded to him or her under 
any plan maintained by the Corporation may elect, to the extent 
permitted under that plan or otherwise by the Committee, to convert all 
or part of that option to an Option for Stock Units in accordance with 
the provisions of this Section 3.2.

            (a)   ELECTION TO CONVERT OPTION. A Participant can elect to 
convert all or a portion of an outstanding option to an Option for Stock 
Units by providing written notice to the Corporation, which must be 
received by the Corporate Executive Compensation Department, at least 
six months before the expiration date of the option.  The election must 
specify the number of shares of Corporation common stock subject to the 
option that are to become subject to the Option for Stock Units.  The 
election must also specify the date on which the Stock Units to be 
credited to the Participant's Account upon the exercise of the Option 
for Stock Units are to be paid to the Participant; such date may be (1) 
the Participant's termination of active employment (including as a 
result of retirement, onset of long term disability or other reason for 
termination) with the Corporation or (2) a specific date (which may be 
determined by reference to the Participant's termination of employment 
(by retirement or otherwise) or by reference to the date of the 
Participant's exercise of the Option for Stock Units).  

            (b)   EXERCISE OF OPTIONS FOR STOCK UNITS.  A Participant may 
not exercise an Option for Stock Units until the expiration of the six-
month period beginning on the date on which the Participant's option is 
converted to an Option for Stock Units.  Thereafter, but only until the 
expiration of the period during which the option that the Participant 
converted to an Option for Stock Units could, in accordance with its 
original terms be exercised, a Participant may exercise Options for 
Stock Units by providing written notice of exercise to the place 
designated by the Committee.  At the time of the exercise of an Option 
for Stock Units, the Participant must certify to the Corporation or its 
designee that he or she currently owns shares of Corporation common 
stock sufficient to pay the aggregate option price and, if the shares 
were acquired for services to the Corporation that he or she has held 
those shares for at least six months.

            (c)   EFFECT OF EXERCISE.   
                  (1)  As soon as practicable following receipt of a 
Participant's notice of exercise under Section 3.2(b), Stock Units will 
be credited to the Participant's Account.  The number of Stock Units to 
be so credited will be equal to (A) the difference between (i) the 
aggregate Fair Market Value (as defined in the Unisys 1990 Long-Term 
Incentive Plan) on the date of exercise of the shares of Corporation 
common stock relating to the portion of the Option for Stock Units that 
the Participant has elected to exercise and (ii) the sum of (a) the 
aggregate exercise price and (b) any Social Security, Medicare or state 
or local income tax required to be withheld with respect to the 
exercise, divided by (B) the Fair Market Value (as defined in the 
Unisys 1990 Long-Term Incentive Plan)  of a share of Corporation common 
stock on the date of exercise.  

                  (2)  Notwithstanding a Participant's election of a 
payment date under Section 3.2(a), if the Participant exercises an 
Option for Stock Units later than two years before the payment date 
elected, the Stock Units credited to his or her Account as a result of 
the exercise will be paid as soon as practicable after the second 
anniversary of the date of exercise. 

            (d)   EFFECT OF TERMINATION OF EMPLOYMENT.  If a Participant 
terminates employment before exercising an Option for Stock Units, the 
Option for Stock Units will remain exercisable to the extent that the 
option that the Participant converted to the Option for Stock Units 
would have remained exercisable absent conversion.  If, however, the 
Participant (or his or her Beneficiary) subsequently exercises the 
Option for Stock Units after his or her Account Balance has been paid or 
has begun to be paid as a result of his or her termination of 
employment, the Stock Units acquire upon such exercise will be 
distributed immediately.  If the Participant (or his or her Beneficiary) 
fails to exercise the Option for Stock Units before the date on which 
the option that the Participant converted to an Option for Stock Units 
would have expired or terminated, then the Participant's (or 
Beneficiary's) right to exercise the Option for Stock Units will 
likewise terminate.

          3.3   PAYMENT OF FICA AND OTHER TAXES.  Generally, any FICA or 
other taxes that are payable by the Eligible Executive and are required 
to be withheld by the Corporation during any period with respect to 
amounts deferred under the Plan pursuant to Section 3.1 above during 
such period shall be withheld from the compensation otherwise currently 
payable to the Eligible Executive during the period.  To the extent 
that, as a result of a Deferral Election, the compensation currently 
payable to an Eligible Executive during any period is insufficient to 
permit an amount equal to the FICA and other taxes that are payable by 
the Eligible Executive, and required to be withheld by the Corporation, 
during that period to be withheld from such current compensation, the 
Eligible Executive's Account Balance shall be reduced by an amount equal 
to the sum of (a) the difference between the amount of FICA and other 
taxes payable by the Eligible Executive, and required to be withheld by 
the Corporation, during the period and the amount of compensation 
otherwise currently payable to the Eligible Executive during the period 
and (b) any additional Federal, state and local income taxes payable by 
the Eligible Executive with respect to the reduction in his or her 
Account Balance made pursuant to this Section 3.3.

                            ARTICLE IV
                     CORPORATION CONTRIBUTIONS


          4.1   CORPORATION CONTRIBUTIONS.  The Corporation may make 
Corporation Contributions to a Participant's Corporation Contributions 
Account from time to time.

          4.2   VESTING.  Participants will vest in their Corporation 
Contributions Accounts according to the schedule established by the 
Corporation when the Corporation Contribution is made to that 
Corporation Contributions Account.  If a Participant dies while employed 
by the Corporation, the Participant will be fully vested in all his 
Corporation Contributions Accounts, if any.

                            ARTICLE V
                  TREATMENT OF DEFERRED AMOUNTS

          5.1   MEMORANDUM ACCOUNT.  The Corporation shall establish on 
its books a separate Account for each Participant for each calendar year 
in which the Participant defers amounts pursuant to a Deferral Election.  
In addition, Corporation Contributions, if any, will be credited to a 
Participant's Account and recorded in a separate Corporation 
Contributions Account therein.  Further, when a Participant acquires any 
Deferred Stock Units, those Deferred Stock Units will be credited to his 
or her Account.  Performance Unit Compensation will be credited to the 
Participant's Account as Stock Units.  As of each Valuation Date, 
incremental amounts determined in accordance with Section 5.2 will be 
credited or debited to each Participant's Account.  Any payments made to 
or on behalf of the Participant and for his or her Beneficiary shall be 
debited from the Account.  No assets shall be segregated or earmarked in 
respect to any Account and no Participant or Beneficiary shall have any 
right to assign, transfer, pledge or hypothecate his or her interest or 
any portion thereof in his or her Account.  The Plan and the crediting 
of Accounts hereunder shall not constitute a trust or a funded 
arrangement of any sort and shall be merely for the purpose of recording 
an unsecured contractual obligation of the Corporation.

          5.2   INVESTMENT MEASUREMENT OPTIONS.  

            (a)   Subject to the provisions of this Section 5.2, a 
Participant's Account shall be credited or debited with amounts equal to 
the amounts that would be earned or lost with respect to the 
Participant's Account Balance (including, with respect to Stock Units, 
dividend equivalents and other adjustments) if amounts equal to that 
Account Balance were actually invested in the Investment Measurement 
Options in the manner specified by the Participant.

            (b)   Each Eligible Executive may elect, at the same time as 
a Deferral Election is made, to have one or more of the Investment 
Measurement Options applied to current deferrals.  Such election with 
respect to current deferrals may be changed at any time upon appropriate 
notice to the Plan recordkeeper

            (c)   Subject to the restrictions described in subsection 
(e), a Participant may elect to change the manner in which Investment 
Measurement Options apply to existing Account Balances.  Such an 
election will be effective as soon as practicable after the Participant 
has provided appropriate notice to the Plan recordkeeper.

            (d)   Notwithstanding anything to the contrary in the Plan, 
Deferred Stock Units credited to a Participant's Account as the result 
of the Participant's exercise of an Option for Stock Units or the 
deferral of Performance Unit Compensation may not be credited with any 
Investment Measurement Option.

            (e)   The following rules apply to Investment Measurement 
Options. 

                  (1)  The percentage of a Participant's current 
deferrals and/or Account Balance to which a specified Investment 
Measurement Option is to be applied must be in integral multiples of one 
percent (1%).  The Participant may change the specified Investment 
Measurement Options which shall apply to his or her Account(s) on any 
business day as of which the Plan's recordkeeper is open for business.  
Changes in a specified Investment Measurement Option with respect to a 
Participant's Account will be effective as soon as administratively 
practicable following receipt of the Participant's election.   

                  (2)  To the extent that a Participant has not 
specified an Investment Measurement Option to apply to all or a portion 
of his or her current deferrals and/or Account Balance, the Insurance 
Contract Fund or such other fund as designated by the Committee from 
time to time shall be deemed to be the applicable Investment Measurement 
Option.

                  (3)  The chosen Investment Measurement Option or 
Options shall apply to deferred amounts on and after the date on which 
such amounts are credited to the Participant's Account. 

            (f)   The Committee shall have the authority to modify the 
rules and restrictions relating to Investment Measurement Options 
(including the authority to change such Investment Measurement Options 
prospectively) as it, in its discretion, deems necessary and in accord 
with the investment practices in place under the USP.

                            ARTICLE VI
                   PAYMENT OF DEFERRED AMOUNTS

          6.1   FORM AND TIME OF PAYMENT.  The benefits to which a 
Participant or a Beneficiary may be entitled under the Plan shall be 
paid in accordance with this Section 6.1.

            (a)   All payments under the Plan shall be made in cash, 
provided, however, that unless otherwise provided by the Committee, 
Stock Units shall be paid in shares of Unisys common stock.

            (b)   Except as otherwise provided in Sections 6.3 and 6.4, 
payment of a Participant's Account Balance (other than with respect to 
his Deferred Stock Units) shall commence as of the Valuation Date next 
following the date or dates specified in the Participant's Deferral 
Election or Elections or (where applicable) the Participant's Revised 
Election or Elections, provided, however, that where the Participant's 
Deferral Election or Elections or (where applicable) the Participant's 
Revised Election or Elections specify that payments with respect to a 
Participant's Account Balance are to commence as of a specified date or 
specified dates not determined by reference to the Participant's 
termination of employment and the Participant terminates employment with 
the Corporation prior to such date or dates, payment of the portion of 
the Participant's Account Balance that was deferred to such date or 
dates shall commence as of the Valuation Date next following the 
Participant's termination of employment, but in the same form specified 
in the Participant's Deferral Election or Elections or (where 
applicable) the Participant's Revised Election or Elections.  

            (c)   All payments shall be made in the form or forms 
specified in the Participant's Deferral Election or Elections or (where 
applicable) the Participant's Revised Election or Elections.

            (d)   To the extent a Participant has not specified the form 
or time of payment of his or her Account Balance, payment will be made 
in a single sum as soon as administratively practicable, but within 90 
days, after the first Valuation Date following the Participant's 
termination of employment (by retirement or otherwise) with the 
Corporation.  

            (e)   Where a Participant has elected payment in the form of 
annual installments, each installment payment after the initial 
installment payment shall be made on or about March 31 of each year 
following the year in which the first installment was paid.  With 
respect to each Deferral Election made by a Participant, the amount of 
each annual installment payment to be made to a Participant or 
Beneficiary under such Deferral Election shall be determined by dividing 
the portion of the Participant's Account Balance attributable to such 
Deferral Election as of the latest Valuation Date preceding the date of 
payment by the number of installments remaining to be paid under such 
Deferral Election.

            (f)   Notwithstanding any Deferral Election made by the 
Participant:

                  (1)  If the Participant terminates employment (by 
retirement, by onset of a long term disability or otherwise) before the 
specific date as of which a Participant's Account Balance is scheduled 
to be paid to the Participant, the Participant's election with respect 
to the time of commencement of payment will be accelerated until the 
date as of which the Participant terminated employment.

                  (2)  If a Participant terminates employment (by reason 
of retirement, long term disability or otherwise) after beginning to 
receive any portion of an Account Balance that was to be paid to the 
Participant as of a specific date, the remaining Account Balance shall 
be distributed in accordance with the distribution election in effect at 
the time of the Participant's termination of employment.

                  (3)  If the balance in all of a Participant's Accounts 
is less than $25,000 at the time of a Participant's termination of 
employment (by retirement or otherwise), the balance in all the 
Participant's Accounts shall be paid to the Participant in a single sum.

                  (4)  Any portion of a Participant's Account Balance 
that has not been paid to the Participant as of the date of his or her 
death shall be paid to the Participant's Beneficiary in a single sum as 
soon as administratively practicable after the Valuation Date following 
the date on which the Corporation receives notification of the 
Participant's death.

          6.2   REVISED ELECTION.  

            (a)   Pursuant to a Revised Election, a Participant may 
specify:

                  (1)  a date for the commencement of the payment of the 
Participant's Account Balance that is either the date of the 
Participant's termination of employment (by retirement or otherwise) or 
a date at least one year after the date specified in the Participant's 
applicable Deferral Election; and/or 

                  (2)  a form of payment that calls for a greater number 
of annual installment payments than that specified in the Participant's 
applicable Deferral Election, or a number of annual installment payments 
where the Participant specified a single sum payment in his or her 
applicable Deferral Election.

                  (3)  Notwithstanding the foregoing, an Eligible 
Executive may not elect a time of benefit commencement and/or a form of 
payment to the extent that such an election would cause any payments to 
be made after the March 31 first following the date that is 20 years 
after the date of the Eligible Executive's termination of employment.

            (b)   A Participant may only make three Revised Elections 
with respect to each of the Participant's Accounts.

            (c)   To be effective, a Revised Election must be:

                  (1)  made in writing by the Participant on a form 
furnished for such purpose by the Corporate Executive Compensation 
Department;

                  (2)  submitted to the Corporate Executive Compensation 
Department on or before the date that is three months and one day before 
the date on which the portion of the Participant's Account Balance that 
is the subject of the Revised Election would, absent the Revised 
Election, first become payable; and 

                  (3)  approved by the Corporate Executive Compensation 
Department.  A Revised Election will be deemed to have been approved by 
the Corporate Executive Compensation Department if it is not disapproved 
by the Corporate Executive Compensation Department within ten days of 
the date on which it is received.

          6.3   SPECIAL PAYMENTS.

            (a)   Notwithstanding any other provision of the Plan to the 
contrary, a Participant may receive payment of all or a portion of the 
balance in one or more of his or her Accounts as soon as 
administratively practicable following the receipt by the Corporate 
Executive Compensation Department of the Participant's written request 
for such payment.  The Participant's election may specify the Account or 
Accounts from which the payment is to be made.

            (b)   As a condition of receiving any payment made pursuant 
to Subsection 6.3(a), a Participant will be required to pay to the 
Corporation an amount equal to eight percent of the amount of the 
payment made pursuant to Subsection 6.3(a), which payment shall 
generally be deducted from the amount otherwise payable to the 
Participant under Subsection 6.3(a), and the Participant will be subject 
to suspension of the Participant's further participation in the Plan or 
any equivalent plan or plans maintained by the Corporation or a 
subsidiary of the Corporation until the last day of the first full 
calendar year that follows the date on which the Participant submits his 
request for payment under this Subsection 6.3(b). 

            (c)   If a Participant receives a payment of less than the 
entire balance in any of his or her Accounts from which payment is being 
made pursuant to Subsection 6.3(a), the portion of the Participant's 
Account Balance to which each Investment Measurement Option is applied 
shall be reduced proportionately so that the Investment Measurement 
Options apply to the Participant's Account Balance in the same 
percentages immediately before and immediately after the payment.

            (d)   Notwithstanding any provision of the Plan to the 
contrary, in the event the Committee determines that any portion of a 
Participant's Account Balance is the subject of a final determination by 
the Internal Revenue Service that such portion is includible in the 
Participant's taxable income, the Participant's Account Balance shall be 
distributed to the extent it is so includible.  All income taxes and 
related interest and penalties associated with credits to or 
distributions from a Participant's Account shall be borne by the 
Participant.

          6.4   ACCELERATION OF PAYMENT.  Notwithstanding any other 
provision of this Plan to the contrary, the Committee in its sole 
discretion may accelerate the payment of Account Balances to all or any 
group of similarly situated Participants or Beneficiaries, whether 
before or after the Participants' termination of service, in response to 
changes in the tax laws or accounting principles.

                            ARTICLE VII
                           MISCELLANEOUS

          7.1   AMENDMENT.  The Board may modify or amend, in whole or in 
part, any of or all the provisions of the Plan, or suspend or terminate 
it entirely; provided, however, that any such modification, amendment, 
suspension or termination may not, without the Participant's consent, 
adversely affect any deferred amount credited to him or her for any 
period prior to the effective date of such modification, amendment, 
suspension or termination.  The Plan shall remain in effect until 
terminated pursuant to this provision.

          7.2   ADMINISTRATION.  The Committee shall have the sole 
authority to interpret the Plan and in its discretion to establish and 
modify administrative rules for the Plan, including (but not limited to) 
establishing rules regarding elections, investments and distributions.  
All expenses and costs in connection with the operation of this Plan 
shall be borne by the Corporation.  The Corporation shall have the right 
to deduct from any payment to be made pursuant to this Plan any federal, 
state or local taxes required by law to be withheld, and any associated 
interest and/or penalties.

          7.3   GOVERNING LAW.  The Plan shall be construed and its 
provisions enforced and administered in accordance with the laws of the 
Commonwealth of Pennsylvania except as such laws may be superseded by 
the federal law.

          7.4   UNFUNDED PLAN.  It is intended that the Plan constitute 
an "unfunded" plan for deferred compensation.  The Corporation may 
authorize the creation of trusts or other arrangements to meet the 
obligations created under the Plan; provided, however, that, unless the 
Corporation otherwise determines, the existence of such trusts or other 
arrangements is consistent with the "unfunded" status of the Plan.  Any 
liability of the Corporation to any person with respect to any grant 
under the Plan shall be based solely upon any contractual obligations 
that may be created pursuant to the Plan.  No such obligation of the 
Corporation shall be deemed to be secured by any pledge of, or other 
encumbrance on, any property of the Corporation.

                            ARTICLE VIII
                     TRANSFER OF ACCOUNT BALANCE

          8.1   TRANSFER TO DIRECTOR'S PLAN.  Notwithstanding any 
election of form of payments made hereunder, a Participant who, 
following his termination of employment with the Corporation will be 
eligible to participate in the Directors' Plan, may elect at any time 
prior to the date that is three months and one day before the 
Participant's termination of employment to transfer all or any portion 
of his Account Balance to the Directors' Plan.  Such transfer must occur 
prior to the date that payments of the Participant's Account Balance 
would otherwise be made, or commence, hereunder.  Upon transfer, the 
Participant's Account Balance (or the portion thereof transferred) will 
be subject to the terms and conditions of the Directors' Plan; provided, 
however, that any election of form of payment made under the Directors' 
Plan with respect to the amount transferred may not provide for a form 
of payment that is in any way more rapid than the form of payment in 
effect under this Plan with respect to such amounts immediately prior to 
transfer to the Directors' Plan.  Valuation of the Account Balance (or 
the portion thereof) to be transferred shall be made consistent with the 
valuation provisions described in Article V.  Upon transfer, the 
Participant's (or his or her Beneficiary's) rights hereunder with 
respect to the amounts transferred shall cease.




                              DEFERRED COMPENSATION
                     PLAN FOR DIRECTORS OF UNISYS CORPORATION

                                    ARTICLE I
                                PURPOSE & AUTHORITY


          1.1   Purpose.  The purpose of the Plan is to offer members of the 
Board of Directors who are not employees of the Corporation the opportunity 
to defer receipt of a portion of their Compensation, under terms advantageous 
to both the Director and the Corporation.  

          1.2   Effective Date.  The Board originally approved the Plan on 
November 20, 1981, and the Plan was subsequently amended, effective January 
1, 1994.  This document reflects the Plan as amended and restated effective 
September 22, 2000.  The terms of this amended and restated Plan shall apply 
to all Account Balances and elections made pursuant to the Plan prior to its 
amendment.

          1.3   Authority.  Any decision made or action taken by the 
Corporation and any of its officers or employees involved in the 
administration of this Plan, or any member of the Board or the Committee 
arising out of or in connection with the construction, administration, 
interpretation and effect of the Plan shall be within the absolute discretion 
of all and each of them, as the case may be, and will be conclusive and 
binding on all parties.  No member of the Board and no employee of the 
Corporation shall
 be liable for any act or action hereunder, whether of 
omission or commission, by any other member or employee or by any agent to 
whom duties in connection with the administration of the Plan have been 
delegated or, except in circumstances involving the member's or employee's 
bad faith, for anything done or omitted to be done by himself or herself.

                                   ARTICLE II
                                  DEFINITIONS


          2.1   "Account" means, for any Participant, each memorandum 
account established for the Participant under Section 4.1.

          2.2   "Account Balance" means, for any Participant as of any date, 
the aggregate amount reflected in his or her Account.

          2.3   "Beneficiary" means the person or persons designated from 
time to time in writing by a Participant to receive payments under the Plan 
after the death of such Participant or, in the absence of such designation or 
in the event that such designated person or persons predeceases the 
Participant, the Participant's estate.

          2.4   "Board" means the Board of Directors of the Corporation.

          2.5   "Committee" means the Corporate Governance and Compensation 
Committee of the Board, or such other committee as may be appointed by the 
Board to administer the Plan.

          2.6   "Compensation" means amounts payable by the Corporation, 
absent deferral, with respect to services provided by a Participant to the 
Corporation as a Director, including retainer and meeting fees, but shall not 
include non-elective stock unit amounts credited, payable or paid under the 
Stock Unit Plan.

          2.7   "Corporation" means Unisys Corporation.

          2.8   "Deferral Election" means an election by an Eligible 
Director to defer a portion of his or her Compensation under the Plan, as 
described in Section 3.1.

          2.9   "Eligible Director" means a member of the Board who is not 
an employee of the Corporation.

          2.10  "Executives' Plan" means the Unisys Corporation  Deferred 
Compensation Plan .

          2.11  "Investment Measurement Option" means any of the 
hypothetical investment alternatives available for determining the additional 
amounts to be credited to a Participant's Account under Section 4.2.  The 
Investment Measurement Options available are all of the investment options 
available to eligible participants under the USP other than the Unisys Common 
Stock Fund.  

          2.12  "Participant" means an Eligible Director or former Eligible 
Director who has made a Deferral Election and who has not received a 
distribution of his or her entire Account Balance.

          2.13  "Plan" means the Deferred Compensation Plan for Directors of 
Unisys Corporation, as set forth herein and as amended from time to time.

          2.14  "Revised Election" means an election made by a Participant, 
in accordance with Section 5.2, to change the date as of which payment of his 
or her Account Balance is to commence and/or the form in which such payment 
is to be made.

          2.15  "USP" means the Unisys Savings Plan.

          2.16  "Valuation Date" means any business day as of which the 
interest of a Participant in each of the Participant's Accounts is valued.


                                 ARTICLE III
                           DEFERRAL OF COMPENSATION


          3.1   Deferral Election.

                (a)  Prior to or during any calendar year, each Eligible 
Director may elect to defer all or a portion of his or her Compensation that, 
absent deferral, would be paid to him or her for services rendered during the 
following calendar year or the remainder of the current calendar year, as 
applicable, by properly completing a Deferral Election form.

                (b)  To be effective, a Deferral Election must be made in 
writing by the Eligible Director on a form furnished by the Secretary of the 
Corporation on or before the date that is (I) no later than the December 31 
prior to the calendar year to which the Deferral Election applies or (II) at 
least three months and one day before the date on which the amounts to be 
deferred, absent deferral, would be paid to the Eligible Director, provided, 
however, that an individual who becomes an Eligible Director after January 1 
of a calendar year may make a Deferral Election with respect to Compensation 
that, absent deferral, would be paid to him or her during the remainder of 
the 
calendar year in which he or she has become an Eligible Director, by filing 
the required written election on or before the date that is 30 days after the 
date on which he or she becomes an Eligible Director.  

                (c)  Once made, a Deferral Election shall become effective 
upon approval by the Secretary of the Corporation and is thereafter 
irrevocable, except to the extent otherwise provided in Section 5.2.  A 
Deferral Election will be deemed to have been approved by the Secretary of 
the Corporation if it is not disapproved by the Secretary of the Corporation 
within ten days of the date on which it is received.

                (d)  An Eligible Director's Deferral Election must specify 
either a percentage or a certain dollar amount of his or her Compensation to 
be deferred under the Plan.  In addition, the Deferral Election must specify 
the date on which payment of the amount deferred is to commence and the 
manner in which such payment is to be made.

                  (1)  The Eligible Director must specify the date as of 
which payment of the amount deferred is to commence, subject to Section 
5.1(b) hereof, and may specify that such payment is to commence as of:

                        (A)  his or her termination of service as a member of 
the Board (including as a result of disability); or

                        (B)  a specific date (which may be determined by 
reference to the Eligible Director's termination of service) that is at least 
two years after the date on which the initial amounts to be deferred, absent 
deferral, would be paid to the Eligible Director.

                  (2)  The Eligible Director must specify the manner in which 
payment of his or her Account Balance is to be made and may specify that such 
payment is to be made either in a single sum or in annual installments.

                  (3)  Notwithstanding the foregoing, an Eligible Director 
may not elect a time of benefit commencement and/or a form of payment to the 
extent that such an election would cause any payments to be made after the 
March 31 first following the date that is 20 years after the date of the 
Eligible Director's  termination of service.

                (e)  Deferrals of an Eligible Director's Compensation shall 
be credited to the Plan at the time at which the Compensation, absent 
deferral, would be payable to the Participant.

                (f)  Unless the Deferral Election form specifically provides 
otherwise, a Deferral Election shall expire as of the last day of the 
calendar year that includes the first day on which any amount, absent 
deferral, would be paid to the Eligible Director.


                                   ARTICLE IV
                          TREATMENT OF DEFERRED AMOUNTS


          4.1   Memorandum Account.  The Corporation shall establish on its 
books a separate Account for each Participant for each calendar year in which 
the Participant elects to defer Compensation.  Amounts deferred by a 
participant pursuant to a Deferral Election shall be credited to the 
Participant's Account on the date on which the deferred amounts, absent 
deferral, would have been paid to the Participant. In addition, as of each 
Valuation Date, incremental amounts determined in accordance with Section 4.2 
will be credited or debited to each Participant's Account.  Any payments made 
to or on behalf of the Participant and for his or her Beneficiary shall be 
debited from the Account.  No assets shall be segregated or earmarked in 
respect to any Account and no Participant or Beneficiary shall have any right 
to assign, transfer, pledge or hypothecate his or her interest or any portion 
thereof in his or her Account.  The Plan and the crediting of Accounts 
hereunder shall not constitute a trust or a funded arrangement of any sort 
and shall be merely for the purpose of recording an unsecured contractual 
obligation of the Corporation.

          4.2  Investment Measurement Options.  

                (a)  Subject to the provisions of this Section 4.2, a 
Participant's Account shall be credited or debited with amounts equal to the 
amounts that would be earned or lost with respect to the Participant's 
Account Balance if amounts equal to that Account Balance were actually 
invested in the Investment Measurement Options in the manner specified by the 
Participant.

                (b)  Each Eligible Director may elect, at the same time as a 
Deferral Election is made, to have one or more of the Investment Measurement 
Options applied to current deferrals.  Such election with respect to current 
deferrals may be changed at any time upon appropriate notice to the Corporate 
Executive Compensation Department.  

                (c)  Subject to the restrictions described in Subsection (d), 
a Participant may elect to change the manner in which Investment Measurement 
Options apply to existing Account Balances.  In addition, a Participant may 
elect to transfer all or any portion of his/her Account balance to the 
Director Stock Unit Plan and such amounts will be credited under that Plan as 
Elective Stock Units, subject to the terms and conditions of the Director 
Stock Unit Plan.  Any election described in this subsection (c) will be 
effective upon appropriate notice to the Corporate Executive Compensation 
Department.  

                (d)  The following rules apply to Investment Measurement 
Options. 

                  (1)  The percentage of a Participant's current deferrals 
and/or Account Balance to which a specified Investment Measurement Option is 
to be applied must be a multiple of one percent (1%).  The Participant may 
change the specified Investment Measurement Options which shall apply to his 
or her Account(s) on any business day as of which the Plan's recordkeeper is 
open for business.  Changes in a specified Investment Measurement Option with 
respect to a Participant's Account will be effective as soon as 
administratively practicable following receipt of the Participant's election.

                  (2)  To the extent that a Participant has not specified an 
Investment Measurement Option to apply to all or a portion of his or her 
current deferrals and/or Account Balance, the Insurance Contract Fund or such 
other fund as is designated by the Committee shall be deemed to be the 
applicable Investment Measurement Option.

                  (3)  The chosen Investment Measurement Option or Options 
shall apply to deferred amounts on and after the date on which such amounts, 
absent deferral, would have been paid to the Participant.

                 (e)  The Committee shall have the authority to modify the 
rules and restrictions relating to Investment Measurement Options (including 
the authority to change such Investment Measurement Options prospectively) as 
it, in its discretion, deems necessary and in accord with the investment 
practices in place under the USP.


                                      ARTICLE V
                            PAYMENT OF DEFERRED AMOUNTS


          5.1   Form and Time of Payment.  The benefits to which a 
Participant or a Beneficiary may be entitled under the Plan shall be paid in 
accordance with this Section 5.1.

                (a)  All payments under the Plan shall be made in cash. 

                (b)  Except as otherwise provided in Sections 5.3 and 5.4, 
payment of a Participant's Account Balance shall commence as of the Valuation 
Date next following the date or dates specified in the Participant's Deferral 
Election or Elections or (where applicable) the Participant's Revised 
Election or Elections; provided, however, that where the Participant's 
Deferral Election or Elections or (where applicable) the Participant's 
Revised Election or Elections specify that payments with respect to a 
Participant's Account Balance are to commence as of a specified date or 
specified dates not determined by reference to the Participant's retirement 
or other termination of service and the Participant terminates service with 
the Corporation prior to such date or dates, payment of the portion of the 
Participant's Account Balance that was deferred to such date or dates shall 
commence as of the Valuation Date next following the Participant's 
termination of service, but in the same form specified in the Participant's 
Deferral Election or Elections or (where applicable) the Participant's 
Revised Election or Elections.

                (c)  All payments shall be made in the form or forms 
specified in the Participant's Deferral Election or Elections or (where 
applicable) the Participant's Revised Election or Elections.

                (d)  To the extent a Participant has not specified the form 
or time of payment of all or a part of his or her Account Balance, payment of 
the amounts not specified will be made in a single sum as soon as 
administratively practicable, but within 90 days, after the first Valuation 
Date following the Participant's termination of service as a Director. 

                (e)  Where a Participant has elected payment in the form of 
annual installments, each installment payment after the initial installment 
payment shall be made on or about March 31 of each year following the year in 
which the first installment was paid.  With respect to each Deferral Election 
made by a Participant, the amount of each annual installment payment to be 
made to a Participant under such Deferral Election shall be determined by 
dividing the portion of the Participant's Account Balance covered by such 
Deferral Election as of the latest Valuation Date preceding the date of 
payment by the number of installments remaining to be paid under such 
Deferral Election.

                (f) Notwithstanding any Deferral Election made by the 
Participant:

                  (1)  If the Participant terminates service as a Director 
before the specific date as of which a Participant's Account Balance is 
scheduled to be paid to the Participant, the Participant's election with 
respect to the time of commencement of payment will be accelerated to  the 
date as of which the Participant terminated service as a director.

                  (2)  If a Participant terminates service as a Director 
after beginning to receive any portion of an Account Balance that was to be 
paid to the Participant as of a specific date, the remaining Account Balance 
shall be distributed in accordance with the distribution election in effect 
at the time of the Participant's termination of service as a Director.

                  (3)  If the balance in all of a Participant's Accounts is 
less than a minimum amount established by the Committee at the time of a 
Participant's termination of service as a Director, the balance in all the 
Participant's Accounts shall be paid to the Participant in a single sum.

                  (4)  Any portion of a Participant's Account Balance that 
has not been paid to the Participant as of the date of his or her death shall 
be paid to the Participant's Beneficiary in a single sum as soon as 
administratively practicable after the Valuation Date following the date on 
which the Corporation receives notification of the Participant's death.

          5.2   Revised Election.  

                (a)  Pursuant to a Revised Election, a Participant may 
specify:

                  (1)  a date for the commencement of the payment of the 
Participant's Account Balance that is either the date of the Participant's 
termination of service as a Director or a date at least one year after the 
date specified in the Participant's applicable Deferral Election; and/or 

                  (2)  a form of payment that calls for a greater number of 
annual installment payments than that specified in the Participant's 
applicable Deferral Election, or a number of annual installment payments 
where the Participant specified a single sum payment in his or her applicable 
Deferral Election.

                  (3)  Notwithstanding the foregoing, a Participant  may not 
elect a time of benefit commencement and/or a form of payment to the extent 
that such an election would cause any payments to be made after the March 31 
first following the date that is 20 years after the date of the Eligible 
Executive's termination of service as a Director.

                (b)  A Participant may only make three Revised Elections with 
respect to each of  the Participant's Accounts.
 
                (c)  To be effective, a Revised Election must be:

                  (1)  made in writing by the Participant on a form furnished 
for such purpose by the Corporate Executive Compensation Department;

                  (2)  submitted to the Corporate Executive Compensation 
Department on or before the date that is three months and one day before the 
date on which the portion of the Participant's Account Balance that is the 
subject of the Revised Election would, absent the Revised Election, first 
become payable; and 

                  (3)  approved by the Corporate Executive Compensation 
Department.  A Revised Election will be deemed to have been approved by the 
Corporate Executive Compensation Department if it is not disapproved by the 
Corporate Executive Compensation Department within ten days of the date on 
which it is received.

          5.3   Special Payment.  

                (a)  Notwithstanding any other provision of the Plan to the 
Contrary, a Participant may receive payment of all or a portion of his or her 
Account Balance as soon as administratively practicable following the receipt 
by the Secretary of the Corporation of the Participant's written request for 
such payment.

                (b)  As a condition of receiving any payment made pursuant to 
Subsection 5.3(a), a Participant will be subject to, as a penalty, payment to 
the Company of an amount equal to eight percent of the amount of the payment 
made pursuant to Subsection 5.3(a) and suspension of the Participant's 
further participation in the Plan, the Unisys Corporation Director Stock Unit 
Plan, or any equivalent plan or plans maintained by the Corporation or a 
subsidiary of the Corporation for the entire full calendar year that follows 
the date on which the Participant submits to the Secretary of the Corporation 
his or her request for payment pursuant to Subsection 5.3(a).  The payment to 
the Company shall generally be deducted from the amount otherwise payable to 
the Participant under Subsection 5.3(a).

                (c)  If a Participant receives a payment of less than his or 
her entire Account Balance pursuant to Subsection 5.3(a), the portion of the 
Participant's Account Balance to which each Investment Measurement Option is 
applied shall be reduced proportionately so that the Investment Measurement 
Options apply to the Participant's Account Balance in the same percentage 
immediately before and immediately after the payment.

                (d)  Notwithstanding any provision of the Plan to the 
contrary, in the event the Committee determines that any portion of a 
Participant's Account Balance is the subject of a determination by the 
Internal Revenue Service that such portion is includible in the Participant's 
taxable income, the Participant's Account Balance shall be distributed to the 
extent it is so includible.  All income taxes and related interest and 
penalties associated with credits to or distributions from a Participant's 
Account shall be borne by the Participant.

          5.4   Acceleration of Payment.  Notwithstanding any other 
provision of this Plan to the contrary, the Committee in its sole discretion 
may accelerate the payment of Account Balances to all or any group of 
similarly situated Participants or Beneficiaries, whether before or after the 
Participant's termination of service, in response to changes in the tax laws 
or accounting principles.


                                  ARTICLE VI
                                 MISCELLANEOUS


          6.1   Amendment.   The Board may modify or amend, in whole or in 
part, any of or all the provisions of the Plan, or suspend or terminate it 
entirely; provided, however, that any such modification, amendment, 
suspension or termination may not, without the Participant's consent, 
adversely affect any deferred amount credited to him or her for any period 
prior to the effective date of such modification, amendment, suspension or 
termination.  The Plan shall remain in effect until terminated pursuant to 
this provision.

          6.2   Administration.  The Committee shall have the sole authority 
to interpret the Plan and in its discretion to establish and modify 
administrative rules for the Plan.  All expenses and costs in connection with 
the operation of this Plan shall be borne by the Corporation.  The 
Corporation shall have the right to deduct from any payment to be made 
pursuant to this Plan any federal, state or local taxes required by law to be 
withheld, and any associated interest and/or penalties.

          6.3   Governing Law.  The Plan shall be construed and its 
provisions enforced and administered in accordance with the laws of the 
Commonwealth of Pennsylvania except as such laws may be superseded by the 
federal law.


                                   ARTICLE VII
                          TRANSFER OF ACCOUNT BALANCE


          7.1   Transfer of Executives' Plan Accounts.  Notwithstanding any 
other provision of the Plan to the contrary, a Director who is a former 
employee of Unisys Corporation and who is a participant in the Executives' 
Plan may elect to transfer any or all of his/her account balance in the 
Executives' Plan into this Plan.  Upon transfer, such amounts shall be 
subject to the terms and conditions of this Plan, provided that all elections 
previously made under the Executives' Plan with respect to such amounts shall 
continue in effect until otherwise modified hereunder.  Notwithstanding the 
payment election provision described in Article V hereof, in no event may a 
Director elect a form of payment with respect to amounts transferred from the 
Executives' Plan that is any more rapid than the form of payment in effect 
under the Executives' Plan at the time of such transfer.  



                                  ARTICLE VIII
                                CHANGE IN CONTROL


          8.1   Withdrawal Election.

                (a)  Notwithstanding any other provision of the Plan to the 
contrary, in the event of a "change in control," as defined below, each 
Participant may elect to receive a single sum payment of all or any portion 
of his/her account balance. Such election shall only be effective if 
delivered to the Secretary of the Corporation within the ninety-day period 
immediately following the date of the occurrence of the change in control.

                (b)  If an election is timely made, the Participant(or 
Beneficiary) will be entitled to receive, as soon as practicable after the 
expiration of the ninety-day period, an amount equal to (1) the full value or 
any portion thereof of the Account Balance minus (2) an early withdrawal 
penalty equal to 8% of the total value of (1).  The Committee, upon advice of 
counsel, may modify the early withdrawal penalty described above in any way 
it 
deems appropriate and consistent with the purposes of the Plan.

          8.2   Litigation Expenses.  If litigation is brought by a 
Participant or Beneficiary after a change in control to enforce or interpret 
any provision of the Plan, the Corporation to the extent permitted by 
applicable law shall reimburse the Participant (or Beneficiary) for the 
reasonable fees and disbursements of counsel incurred in such litigation.

          8.3   Change in Control Definition.  For purposes of this Article 
VIII, a "change in control" shall have the same meaning as is ascribed to 
that term under the 1990 Long-Term Incentive Plan, or any successor plan 
designated by the Committee.




                          UNISYS CORPORATION
                        DIRECTOR STOCK UNIT PLAN


     1.   Purpose.  The purpose of the Unisys Corporation Director Stock 
Unit Plan (the "Plan") is to provide a vehicle through which all or a portion 
of the remuneration paid to Directors of Unisys Corporation (the 
"Corporation") who are not employees of the Corporation may be paid in a form 
which (1) more closely aligns directors' and stockholders' interests and (ii) 
permits Directors to defer recognition of income until termination of service 
with the Corporation.

     2.   Effective Date.  The Board of Directors (the "Board") approved the 
Plan on November 21, 1991.  The Plan has been amended and restated from time 
to time since its original adoption and the effective date of this amended 
and restated Plan is September 22, 2000.

     3.   Definitions.

          (A)  "Account" means, for any Director, each memorandum account 
established for the Director under Section 7.

          (B)  "Beneficiary" means the person or persons designated from 
time to time in writing by a participating Director to receive payments after 
the death of such Director or, in the absence of any such designation or in 
the event that such designated person or persons shall predecease such 
Director, his/her estate.

          (C)  "Board" shall mean the Board of Directors
 of the 
Corporation.

          (D)  "Change in Control" shall have the same meaning as is 
ascribed to that term under the 1990 Long-Term Incentive Plan, or any 
successor stock option plan.

          (E)  "Committee" means the Corporate Governance and Compensation 
Committee of the Board.

          (F)  "Compensation" includes remuneration (other than that paid 
in accordance with Section 4(B) hereof) for services as a Director, including 
Directors' retainer fees ("Retainer Fees")and Board and Committee meeting 
fees ("Meeting Fees").

          (G)  "Compensation Payment Date" means, with respect to a 
Retainer Fee, the first business day of the month for which such monthly 
Retainer Fee or Meeting Fee is due and payable or such other date as may be 
designated by the Board or Committee from time to time as the payment date 
for Retainer Fees or Meeting Fees.  If Unisys Common Stock is not traded on 
such date, the Compensation Payment Date shall be the next preceding trading 
day.

          (H)  "Corporation" means Unisys Corporation.

          (I)  "Deferred Compensation" means the amount the Director elects 
to defer pursuant to Section 4(A) hereof.

          (J)  "Director" means a member of the Board who is not an 
employee of the Corporation.

          (K)  "Fair Market Value" means, on any date, the sales price of a 
share of Unisys Common Stock as of the official close of the New York Stock 
Exchange at 4:00 p.m. U.S. Eastern Standard Time on such date


          (L)  "Option for Stock Units" means an option, created pursuant 
to a Director's election in accordance with Section 6 that, if exercised by 
the Director, will result in the crediting of Stock Units to the Director's 
Account.

          (M)  "Stock Units" means Unisys common stock-equivalent units, 
which may be awarded pursuant to the Plan as Elective or Non-elective Stock 
Units or may be credited to a Director's Account as a result of the 
Director's exercise of an Option for Stock Units.  Stock Units also include 
Frozen Stock Units held under the Directors Deferred Compensation Plan and 
transferred to this Plan effective July 25, 1996.

          (N)  "Stock Unit Award Value" means the dollar amount of the 
Retainer Fee or Meeting Fee, as established by the Board from time to time, 
payable on a Compensation Payment Date.

          (O)  "Valuation Date" means any business day as of which the 
value of a Director's Accounts are determined.

     4.   Crediting of Stock Units.
		
          (A)  \	Elective Stock Units.  Prior to or during any calendar 
year, a Director may elect (i) to defer all or a portion of his or her cash 
Compensation that would be paid to him for services rendered during the 
following calendar year or for the remainder of the current calendar year, as 
applicable, and (ii) to be credited in lieu of such amount with Stock Units.

          (B)  Non-Elective Stock Unit Awards.  On the Compensation Payment 
Date, each Director's Account shall be credited with Stock Units equal to the 
Stock Unit Award Value.  The Board shall have the discretion to make 
additional Stock Unit awards at such times and in such amounts as it deems 
appropriate.

          (C)  Amount Credited.  The number of Stock Units to be credited 
to a Director's Account under Sections 4(A) and (B) shall be the quotient of 
(a) divided by (b) where (a) equals the Deferred Compensation or Stock Unit 
Award Value, as applicable, and (b) equals the Fair Market Value on the 
Compensation Payment Date.

          (D)  Transfer of Previously Deferred Amounts.  Upon the election 
of a Director, all or any portion of a Director's Account held under the 
terms of the Deferred Compensation Plan for Directors of Unisys Corporation 
may be transferred and credited under this Plan as Elective Stock Units, 
based on the Fair Market Value on the date of transfer.  Payment of a 
Director's Stock Units credited to the Plan under this Section 4(D) shall be 
made in accordance with the Director's original deferral election, subject to 
any subsequent elections permitted under this Plan.

     5.   Elections.

          (A)  A Director's election to defer Compensation shall be 
executed in writing on a form furnished by the Secretary of the Corporation 
on or before the date that is (I) no later than December 31 of the year 
preceding the calendar year to which the election applies or (II) at least 
three months and one day before the date on which the Retainer Fee or Meeting 
Fee to be deferred, absent deferral, would be paid to the Director, provided, 
however, that an individual who becomes a Director after January 1 of a 
calendar year may make an Election with respect to Compensation that has not 
been paid and, absent deferral, would be paid to him or her during the 
remainder of the calendar year in which he or she has become a Director, by 
executing the required written election on or before the date that is 30 days 
after the date on which he or she becomes a Director.  The election must 
specify that the Director desires to be credited Stock Units in lieu of 
receiving his/her Compensation in cash.

          (B)  An election, once made, shall be irrevocable with respect to 
Compensation payable for the calendar year or years to which it applies. 

          (C)  An election must specify either a percentage or a certain 
dollar amount of the Compensation to be deferred under the Plan.

          (D)  Any amounts distributed under the Plan on or after April 26, 
2000 shall be distributed in the form of shares of common stock of the 
Corporation.

          (E)  An election shall specify the date on which payment of the 
amount deferred is to commence, subject to Sections 9 and 10 hereof, and may 
specify that such payment is to commence as of:

                (1)  the Director's termination of service as a member of 
the Board (including as a result of disability); or

                (2)  a specific date (which may be determined by reference 
to the Director's termination of service) that is at least two years after 
the date on which the initial amounts to be deferred, absent deferral, would 
be paid to the Director.

          (F)  The Director must specify the manner in which payment of his 
or her Account is to be made and may specify that such payment is to be made 
either in a single sum or in annual installments.

          (G)  Notwithstanding the foregoing, a Director may not elect a 
time of benefit commencement and/or a form of payment to the extent that such 
an election would cause any payments to be made after the March 31 first 
following the date that is 20 years after the date of the Director's 
termination of service.

          (H)  Deferrals of a Director's Compensation shall be credited to 
the Plan at the time at which the Compensation, absent deferral, would 
otherwise be payable to the Director.

          (I)  Unless the Election form specifically provides otherwise, an 
Election shall expire as of the last day of the calendar year that includes 
the first day on which any compensation, absent deferral, would be paid to 
the Director.

          (J)  Additional payment elections with respect to Non- Elective 
Stock Unit Awards may be provided if deemed necessary and appropriate by 
the Committee. 

	
     6.   Options for Stock Units.  A Director who holds an option for 
Corporation common stock that was awarded to him or her under any plan 
maintained by the Corporation may elect, to the extent permitted under that 
plan or otherwise by the Committee, to convert all or part of that option to 
an Option for Stock Units in accordance with the provisions of this Section 
6.

          (a)  Election to Convert Option.  A Director can elect to convert 
all or a portion of an outstanding option to an Option for Stock Units by 
providing written notice to the Corporation, which must be received by the 
Corporate Executive Compensation Department, at least six months before the 
expiration date of the option.  The election must specify the number of 
shares of Corporation common stock subject to the option that are to become 
subject to the Option for Stock Units.  The election must also specify the 
date on which the Stock Units to be credited to the Director's Account upon 
the exercise of the Option for Stock Units are to be paid to the Director; 
such date may be (1) the Director's termination of service or (2) a specific 
date (which may be determined by reference to the Director's termination of 
service or by reference to the date of the Director's exercise of the Option 
for Stock Units).  

          (b)  Exercise of Options for Stock Units.  A Director may not 
exercise an Option for Stock Units until the expiration of the six-month 
period beginning on the date on which the Director's option is converted to 
an Option for Stock Units.  Thereafter, but only until the expiration of the 
period during which the option that the Director converted to an Option for 
Stock Units could, in accordance with its original terms be exercised, a 
Director may exercise Options for Stock Units by providing written notice of 
exercise to the place designated by the Committee.  At the time of the 
exercise of an Option for Stock Units, the Director must certify to the 
Corporation or its designee that he or she currently owns shares of 
Corporation common stock sufficient to pay the aggregate option price and, if 
the shares were acquired for services to the Corporation that he or she has 
held those shares for at least six months.

          (c)  Effect of Exercise.   

                (1)  As soon as practicable following receipt of a 
Director's notice of exercise under Section 6(b), Stock Units will be 
credited to the Director's Account.  The number of Stock Units to be so 
credited will be equal to (A) the difference between (i) the aggregate Fair 
Market Value (as defined in the Directors Stock Option Plan) on the date of 
exercise of the shares of Corporation common stock relating to the portion of 
the Option for Stock Units that the Director has elected to exercise and (ii) 
the sum of (a) the aggregate exercise price and (b) any Social Security, 
Medicare or state or local income tax required to be withheld with respect to 
the exercise, divided by (B) the Fair Market Value (as defined in Directors 
Stock Option Plan)  of a share of Corporation common stock on the date of 
exercise.  

                (2)  Notwithstanding a Director's election of a payment 
date under Section 6(a), if the Director exercises an Option for Stock Units 
later than two years before the payment date elected, the Stock Units 
credited to his or her Account as a result of the exercise will be paid as 
soon as practicable after the second anniversary of the date of exercise. 

          (d)  Effect of Termination of Service.  If a Director 
terminates service before exercising an Option for Stock Units, the Option 
for Stock Units will remain exercisable to the extent that the option that 
the Director converted to the Option for Stock Units would have remained 
exercisable absent conversion.  If, however, the Director (or his or her 
Beneficiary) subsequently exercises the Option for Stock Units after his or 
her Account Balance has been paid or has begun to be paid as a result of his 
or her termination of service, the Stock Units acquired upon such exercise 
will be distributed immediately.  If the Director (or his or her Beneficiary) 
fails to exercise the Option for Stock Units before the date on which the 
option that the Director converted to an Option for Stock Units would have 
expired or terminated, then the Director's (or Beneficiary's) right to 
exercise the Option for Stock Units will likewise terminate.

     7.   Memorandum Account.  The Corporation shall establish on its books 
a separate memorandum account for each Director for each year in which Stock 
Units are awarded to the Director.  Stock Units, dividends and other 
adjustments shall be credited to the account and payments made to the 
Director or Beneficiary shall be debited to the account.  No assets shall be 
segregated or earmarked in respect of any amounts credited to the Account and 
no Director shall have any right to assign, transfer, pledge or hypothecate 
his or her interest or any portion thereof in his or her Account.  The Plan 
and the crediting of Accounts hereunder shall not constitute a trust and 
shall be merely for the purpose of recording an unsecured contractual 
obligation.

     8.   Dividends and Other Adjustments.  If the Corporation shall issue a 
stock dividend on the common stock, stock dividend equivalents shall be 
credited to the Account, as of the dividend payment date, as Stock Units in 
the same amount as the stock dividends to which the Director would have been 
entitled if the Stock Units were shares of common stock.  Cash dividends, if 
any, shall be credited to the Account, as of the dividend payment date, in 
the form of Stock Units determined in the manner set forth in Section 4(C) 
hereof based on the Fair Market Value of the Common Stock on the dividend 
payment date.  The Account shall be appropriately adjusted to reflect splits, 
reverse splits, or comparable changes to the Corporation's common stock.

     9.   Distribution of Accounts.
		
          (A)  Payment Election.  Except as otherwise provided in Section 
10, payment of an Account shall commence as of the Valuation Date next 
following the date or dates specified in the Election or Elections or (where 
applicable) the Revised Election or Elections; provided, however, that where 
the Election or Elections or (where applicable) the Revised Election or 
Elections specify that payments with respect to an Account are to commence as 
of a specified date or specified dates not determined by reference to the 
Director's termination of service and the Director terminates service prior 
to such date or dates, payment of the portion of the Director's Account that 
was to commence on such date or dates shall commence as of the Valuation Date 
next following the Director's termination of service, but in the same form 
specified in the Director's Election or Elections or (where applicable) the 
Revised Election or Elections.

                (1)  All payments shall be made in the form or forms 
specified in the Election or Elections or (where applicable) the Revised 
Election or Elections.  

                (2)  To the extent a Director has not specified the form or 
time of payment of all or a part of his or her Account, payment of the 
amounts not specified will be made in a single sum as soon as 
administratively practicable, but within 90 days, after the first Valuation 
Date following the Director's termination of service as a Director. 

                (3)  Where a Director has elected payment in the form of 
annual installments, each installment payment after the initial installment 
payment shall be made on or about March 31 of each year following the year in 
which the first installment was paid.  With respect to each Election made by 
a Director, the amount of each annual installment payment to be made to the 
Director shall be determined by dividing the portion of the Director's 
Account covered by such Election as of the latest Valuation Date preceding 
the date of payment by the number of installments remaining to be paid under 
such Election.

                (4)  Notwithstanding any election made by a Director, any 
portion of a Director's Account that has not been paid to the Director as of 
the date of his or her death shall be paid to the Director's Beneficiary in a 
single sum as soon as administratively practicable, but within 90 days 
following the Valuation Date on which the Corporation receives notification 
of the Director's death.

          (B)  Revised Election.

                (1)  Pursuant to a Revised Election, a Director may specify:

                     (I)   a date for the commencement of the payment of 
the Director's Account that is after the date specified in the Director's 
Election; and/or

                     (II)  a form of payment that calls for a greater 
number of annual installment payments than that specified in the Director's 
Election, or a number of annual installment payments where the Director 
specified a single sum payment in his or her Election; and/or

                     (III) Notwithstanding the foregoing, a Director may 
not elect a time of benefit commencement and/or a form of payment to the 
extent that such an election would cause any payments to be made after the 
March 31 first following the date that is 20 years after the date of the 
Director's termination of service as a Director.

                (2)  To be effective, a Revised Election must be:

                     (I)   made in writing by the Director on a form 
furnished for such purpose by the Secretary of the Corporation;

                     (II)  submitted to the Secretary of the Corporation on 
or before the date that is three months and one day before the date on which 
the portion of the Director's Account that is the subject of the Revised 
Election would, absent the Revised Election, first become payable; and 

                     (III) approved by the Secretary of the Corporation.  A 
Revised Election will be deemed to have been approved by the Secretary of the 
Corporation if it is not disapproved by the Secretary of the Corporation 
within ten days of the date on which it is received.

                (3)  A Director may only make three revised elections with 
respect to each of his or her accounts.

          (C)  Valuation of Account.  In determining the amount to be paid 
upon termination of service, the cash value of a Director's Account shall 
equal the product of the number of Stock Units credited to the Account 
multiplied by the Fair Market Value as of the applicable Valuation Date. The 
value of Stock Units payable in stock shall equal shares of Unisys Common 
Stock equal to the number of whole Stock Units.  The value of fractional 
Stock Units shall be paid in cash.  The amount of each annual installment 
payment shall be determined by dividing the value determined in according 
with the preceding sentence as of the date of the installment payment by the 
number of installments remaining to be paid.  

          (D)  No Early Withdrawals.  No early withdrawal of a Director's 
Account shall be permitted.  Except as provided in Section 9 hereof or as 
provided in an Election or Revised Election, distribution of a Director's 
Account may be made only upon termination of service as a Director.

     9.   Accelerated Payment.

          (A)  Change in Control.

                (1)  Notwithstanding any other provision of the Plan to the 
contrary, in the event of a "change in control," each Director may elect to 
receive a single sum payment of all or any portion of his or her Stock Unit 
Account balance.  Such election shall only be effective if delivered to the 
Secretary of the Corporation within the ninety-day period immediately 
following the date of the occurrence of the change in control.

                (2)  If an election is timely made, the Director (or 
Beneficiary) will be entitled to receive, as soon as practicable after the 
expiration of the ninety-day period, an amount equal to (a) the full value or 
any portion thereof of the Stock Unit Account minus (b) an early withdrawal 
penalty equal to 8% of the total value of (a).  The Committee, upon advice of 
counsel, may modify the early withdrawal penalty described above in any way 
it deems appropriate and consistent with the purposes of the Plan.

                (3)  If litigation is brought by the Director or the 
Beneficiary after a change in control to enforce or interpret any provision 
of the Plan, the Corporation to the extent permitted by applicable law shall 
reimburse the Director (or Beneficiary) for the reasonable fees and 
disbursements of counsel incurred in such litigation.

          (B)  Change in Circumstances.  Notwithstanding any other 
provision of this Plan to the contrary, the Committee in its sole discretion 
may accelerate the payment of Stock Units Accounts to all or any group of 
similarly situated Directors or Beneficiaries, whether before or after the 
Director's termination of service, in response to changes in the tax laws or 
accounting principles.

     10.  Amendment and Termination.  The Board may modify or amend, in 
whole or in part, any or all of the provisions of the Plan, or suspend or 
terminate it entirely; provided, however, that any such modification, 
amendment, suspension or termination may not, without the participating 
Director's consent, adversely affect any amount credited to his/her Account 
for any period prior to the effective date of such modification, amendment, 
suspension or termination.  The Plan shall remain in effect until terminated 
pursuant to this provision.

     11.  Administration.  The Plan shall be administered by the Committee.  
Any decision made or action taken by the Committee arising out of or in 
connection with the construction, administration, interpretation, or effect 
of the Plan shall be within the absolute discretion of the Committee and 
shall be conclusive and binding on all parties.

     12.  Expenses and Taxes.  All expenses and costs in connection with the 
operation of this Plan shall be borne by the Corporation.  The Corporation 
shall have the right to deduct from any payment to be made pursuant to this 
Plan any federal, state or local taxes required by law to be withheld.

     13.  Governing Law.  The Plan shall be construed and its provisions 
enforced and administered in accordance with the laws of the Commonwealth of 
Pennsylvania except as such laws may be superseded by any federal law.

     14.  SEC Rule 16b.  The Plan is intended to comply with SEC Rule 16b-3 
as adopted by the Securities and Exchange Commission effective November 1, 
1996, and as amended thereafter, and the Committee is authorized to interpret 
the Plan, modify the Plan and/or adopt rules pursuant to the Plan in order to 
comply with Rule 16b-3 or such other exemptions as may be applicable.  
Specifically, the Committee may delay payment of accounts which have been 
deferred or credited for a period of less than six months as of the payment 
date. 




<TABLE>
                             UNISYS CORPORATION
              STATEMENT OF COMPUTATION OF EARNINGS PER SHARE 
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999 
                                (UNAUDITED)
                      (Millions, except share data)
<CAPTION>
                                                  2000             1999
                                               -----------     -----------
<S>                                            <C>             <C>
Basic Earnings Per Common Share

Income before extraordinary items              $     205.7     $     378.4
Less dividends on preferred shares                              (     36.7)
                                               -----------     -----------
Income available to common stockholders
 before extraordinary items                          205.7           341.7
Extraordinary items                             (     19.8)     (     12.1)
                                               -----------     -----------
Net income available to common stockholders    $     185.9     $     329.6
                                               ===========     ===========
                       
Weighted average shares                        312,473,220     279,677,558
                                               ===========     ===========
Basic earnings per share                       
 Before extraordinary items                    $       .66     $      1.22
 Extraordinary items                                  (.06)           (.04)
                                               -----------     -----------
   Total                                       $       .60     $      1.18
                                               ===========     ===========

Diluted Earnings Per Common Share

Income available to common stockholders 
 before extraordinary items                    $     205.7     $     341.7
Plus impact of assumed conversions
  Interest expense on 8 1/4% Convertible 
  Notes due 2006, net of tax                                            .3                
                                               -----------     -----------
Income available to common stockholders
 plus assumed conversions before
 extraordinary items                                 205.7           342.0

Extraordinary items                             (     19.8)     (     12.1)
                                               -----------     -----------
Net income available to common stockholders    $     185.9     $     329.9
                                               ===========     ===========

Weighted average shares                        312,473,220     279,677,558
Plus incremental shares from assumed 
  conversions
  Employee stock plans                           4,065,766      10,796,201
  8 1/4% Convertible Notes due 2006                              1,090,473          
  Preferred
 stock                                                1,169,000
                                               -----------     -----------
Adjusted weighted average shares               316,538,986     292,733,232
                                               ===========     ===========
Diluted earnings per share                                              
  Before extraordinary items                   $       .65     $      1.17
  Extraordinary items                                 (.06)           (.04)
                                               -----------     -----------
     Total                                     $       .59     $      1.13
                                               ===========     ===========
</TABLE>



The average shares listed below were not included in the computation of diluted 
earnings per share because to do so would have been antidilutive for the periods
presented.
  
  Series A preferred stock                                      25,862,243





<TABLE>

                             UNISYS CORPORATION
              STATEMENT OF COMPUTATION OF EARNINGS PER SHARE 
              FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999 
                                (UNAUDITED)
                      (Millions, except share data)
<CAPTION>
                                                  2000             1999
                                               -----------     -----------
<S>                                            <C>             <C>
Basic Earnings Per Common Share

Income before extraordinary item               $      42.9     $     150.5
Less dividends on preferred shares                              (      1.9)
                                               -----------     -----------
Income available to common stockholders
 before extraordinary item                            42.9           148.6
Extraordinary item                                              (     12.1)
                                               -----------     -----------
Net income available to common stockholders    $      42.9     $     136.5
                                               ===========     ===========

Weighted average shares                        313,744,279     302,182,675
                                               ===========     ===========
Basic earnings per share                                              
 Before extraordinary item                     $       .14     $       .49
 Extraordinary item                                                   (.04)
                                               -----------     -----------
    Total                                      $       .14     $       .45      
                                               ===========     ===========

Diluted Earnings Per Common Share

Income available to common stockholders
  before extraordinary item                    $      42.9     $     148.6
Extraordinary item                                              (     12.1)
                                               -----------     -----------
Net income available to common stockholders    $      42.9     $     136.5
                                               ===========     ===========

Weighted average shares                        313,744,279     302,182,675
Plus incremental shares from assumed 
  conversions
  Employee stock plans                           1,771,865      11,492,800
  Preferred stock                                                  866,000          
                                               -----------     -----------
Adjusted weighted average shares               315,516,144     314,541,475
                                               ===========     ===========
Diluted earnings per share                     
  Before extraordinary item                    $       .14     $       .47
  Extraordinary item                                                  (.04)       
                                               -----------     -----------
  Total                                        $       .14     $       .43
                                               ===========     ===========
</TABLE>

The average shares listed below were not included in the computation of diluted 
earnings per share
 because to do so would have been antidilutive for the periods
presented.
  
  Series A preferred stock                                       3,895,078



<TABLE>

                             UNISYS CORPORATION
       COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)
                               ($ in millions)

<CAPTION>                                

                                  Nine             
                                  Months     
                                  Ended           Years Ended December 31
                                  Sept. 30,  ---------------------------------
                                  2000       1999   1998    1997   1996   1995
                                  --------   ----   ----    ----   ----   ----
<S>                                 <C>     <C>    <C>     <C>    <C>    <C>
Fixed charges
Interest expense                    $ 57.7  $127.8 $171.7  $233.2 $249.7 $202.1   
Interest capitalized during 
  the period                           8.9     3.6     -       -      -       -  
Amortization of debt issuance
  expenses                             2.6     4.1    4.6     6.7    6.3    5.1   
Portion of rental expense
  representative of interest          34.7    46.3   49.1    51.8   59.8   65.9
                                    ------  ------ ------  ------ ------ ------
    Total Fixed Charges              103.9   181.8  225.4   291.7  315.8  273.1
                                    ------  ------ ------  ------ ------ ------
Earnings                             
Income (loss) from continuing
 operations before income taxes      311.7   770.3  594.2  (748.1)  80.2 (786.0)
Add (deduct) share of loss 
  (income) of associated 
  companies                          (17.7)    8.9    (.3)    5.9   (4.9)   5.0    
                                    ------  ------ ------  ------ ------- ------
    Subtotal                         294.0   779.2  593.9  (742.2)  75.3 (781.0)
                                    ------  ------ ------  ------ ------- ------

Fixed charges per above              103.9   181.8  225.4   291.7  315.8  273.1
Less interest capitalized during
  the period                          (8.9)   (3.6)    -       -      -       -
                                    ------  ------ ------  ------ ------ -------
Total earnings (loss)               $389.0  $957.4 $819.3 $(450.5)$391.1$(507.9)
                                    ======  ====== ====== ======= ====== =======

Ratio of earnings to fixed 
  charges                             3.74    5.27   3.63    *      1.24     *
                                    ======  ====== ====== ======= ====== =======
</TABLE>


* Earnings for the years ended December 31, 1997 and 1995 were inadequate
  to cover fixed charges by approximately $742.2 and $781.0 million, 
  respectively.






<TABLE> <S> <C>
                                                
<ARTICLE>     5
<LEGEND>      THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
              FROM THE FINANCIAL STATEMENTS INCLUDED IN THE COMPANY'S FORM 10-Q
              FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000 AND IS QUALIFIED
              IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
<MULTIPLIER>  1,000,000
       
<S>                                                              <C>
<PERIOD-TYPE>                                                    9-MOS
<FISCAL-YEAR-END>                                                DEC-31-2000
<PERIOD-END>                                                     SEP-30-2000

<CASH>                                                              235
<SECURITIES>                                                          0
<RECEIVABLES>                                                     1,381
<ALLOWANCES>                                                        (36)
<INVENTORY>                                                         419
<CURRENT-ASSETS>                                                  2,614
<PP&E>                                                            1,612
<DEPRECIATION>                                                     (996)
<TOTAL-ASSETS>                                                    5,845
<CURRENT-LIABILITIES>                                             2,807
<BONDS>                                                             536
<PREFERRED-MANDATORY>                                                 0
<PREFERRED>                                                           0
<COMMON>                                                              3
<OTHER-SE>                                                        2,168
<TOTAL-LIABILITY-AND-EQUITY>                                      5,845
<SALES>                                                           1,794
<TOTAL-REVENUES>                                                  4,957
<CGS>                                                             1,018
<TOTAL-COSTS>                                                     3,462
<OTHER-EXPENSES>                                                      0
<LOSS-PROVISION>                                                      3
<INTEREST-EXPENSE>                                                   58
<INCOME-PRETAX>                                                     312
<INCOME-TAX>                                                        106
<INCOME-CONTINUING>                                                 206
<DISCONTINUED>                                                        0
<EXTRAORDINARY>                                                     (20)
<CHANGES>                                                             0
<NET-INCOME>                                                        186
<EPS-BASIC>                                                         .60
<EPS-DILUTED>                                                       .59


        

</TABLE>