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UNISYS CORPORATION
and
THE BANK OF NEW YORK, Trustee
_______________________________
First Supplemental Indenture
Dated as of March 8, 1996
______________________________
8 1/4% Convertible Subordinated Notes due 2006
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FIRST SUPPLEMENTAL INDENTURE dated as of March 8, 1996 (the
"First Supplemental Indenture"), to the Indenture, dated as of March
1, 1996 (the "Indenture"), between UNISYS CORPORATION, a Delaware
corporation (hereinafter called the "Company"), having its principal
executive office at Township Line and Union Meeting Roads, Blue Bell,
Pennsylvania, 19424 and THE BANK OF NEW YORK, a banking corporation
organized and existing under the laws of the State of New York
(hereinafter called the "Trustee"), having its Corporate Trust Office
at 101 Barclay Street, New York, New York 10286.
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the execution and
delivery of the Indenture to provide for the issuance from time to
time of its unsecured subordinated debentures, notes, bonds or other
evidences of subordinated indebtedness (the "Securities") to be issued
in one or more series, as in the Indenture provided;
WHEREAS, the Company desires and has requested the Trustee
to join it in the execution and delivery of this First Supplemental
Indenture in order to establish and provide for the issuance by the
Company of a series of Securities designated as its 8 1/4% Convertible
Subordinated Notes due 2006 in the aggregate principal amount not to
exceed $299,000,000, a specimen copy of which is attached hereto as
Exhibit A (the "Notes") and incorporated by reference thereby, on the
terms set forth herein;
WHEREAS, Section 901 of the Indenture provides that a
supplemental indenture may be entered into by the Company and the
Trustee without the consent of any holder of any Securities to, inter
alia, establish the terms of any Securities as permitted by Sections
201 and 301 of the Indenture, provided certain conditions are met;
WHEREAS, the conditions set forth in the Indenture for the
execution and delivery of this First Supplemental Indenture have been
complied with; and
WHEREAS, all things necessary to make this First
Supplemental Indenture a valid agreement of the Company and the
Trustee, in accordance with its terms, and a valid amendment of, and
supplement to, the Indenture have been done;
NOW THEREFORE:
There is hereby established a series (as that term is used
in Section 301 of the Indenture) of Securities to be issued under the
Indenture, which series of Securities shall have the terms set forth
herein and in the Notes, and in consideration of the premises and the
purchase and acceptance of the Notes by the holders thereof, the
Company mutually covenants and agrees with the Trustee, for the equal
and proportionate benefit of all holders of the Notes, that the
Indenture is supplemented and amended, to the extent and for the
purposes expressed herein, as follows
ARTICLE ONE
Scope of This First
Supplemental Indenture
----------------------
Section 1.1 Changes, etc. Applicable Only to the Notes.
The changes, modifications and supplements to the Indenture effected
by this First Supplemental Indenture in Sections 2.1 through 2.4
hereof shall only be applicable with respect to, and govern the terms
of, the Notes, which shall be limited in aggregate principal amount to
$299,000,000, except as provided in Section 301(2) of the Indenture,
and shall not apply to any other Securities which may be issued under
the Indenture unless a supplemental indenture with respect to such
other Securities specifically incorporates such changes, modifications
and supplements.
ARTICLE TWO
Amendments to the Indenture
---------------------------
Section 2.1 Amendments to Section 101. Section 101 of
the Indenture is hereby amended by adding the following definitions in
their proper alphabetical order:
"Change In Control" means an event or series of events as a
result of which (1) any "person" (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934
(the "Exchange Act") is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) of
shares entitling the holder thereof to cast more than 50% of the
votes for the election of directors of the Company; (2) the
Company consolidates with or merges into any other corporation,
or conveys, transfers or leases all or substantially all of its
assets to any person, or any other corporation merges into the
Company, and, in the case of any such transaction, the
outstanding Common Stock of the Company is changed or exchanged
as a result; (3) at any time Continuing Directors do not
constitute a majority of the Board of Directors; or (4) on any
day (a "Calculation Date") the Company makes any distribution or
distributions of cash, property or securities (other than regular
quarterly dividends, Common Stock, preferred stock which is
substantially equivalent to Common Stock or rights to acquire
Common Stock or preferred stock which is substantially equivalent
to Common Stock) to holders of Common Stock, or the Company or
any of its Subsidiaries purchases or otherwise acquires Common
Stock, and the sum of the fair market value of such distribution
or purchase on the Calculation Date, plus the fair market value,
when made, of all other such distributions and purchases which
have occurred during the twelve-month period ending on the
Calculation Date, in each case expressed as a percentage of the
aggregate fair market value of all of the shares of Common Stock
of the Company outstanding at the close of business on the last
day prior to the date of declaration of each such distribution
or the date of purchase, exceeds 50%.
"Company Notice" shall have the meaning specified in Section 1006.
"Continuing Director" means at any date a member of the
Board of Directors (1) who was a member of such board 24 months
prior to such date or (2) who was nominated or elected by at
least two-thirds of the directors who were Continuing Directors
at the time of such nomination or election or whose election to
the Board of Directors was recommended or endorsed by at least
two-thirds of the directors who were Continuing Directors at the
time of such election.
"Notes" shall have the meaning specified in the second
recital of this First Supplemental Indenture.
"Put Price" means 100% of the principal amount of the Notes
to be repurchased on the Repurchase Date in accordance with
Section 1006, plus accrued and unpaid interest to the Repurchase Date.
"Repurchase Date" shall have the meaning specified in Section 1006.
"Repurchase Right" shall have the meaning specified in Section 1006.
Section 2.2 Amendment to Article 9. Section 902(1) of
the Indenture is hereby amended by adding the phrase "or reduce any
amount payable on redemption thereof or upon exercise of the
Redemption Right with respect thereto, or" immediately following the
phrase "or any premium payable upon the redemption thereof," and
immediately preceding the phrase "or reduce the amount of the
principal of an Original Issue Discount Security".
Section 2.3 Amendments to Article 10. Article 10 of
the Indenture is hereby amended by adding, immediately following
Section 1005 thereof, the following new Section 1006:
SECTION 1006. Purchase of Notes Upon Change in Control.
(a) Upon the occurrence of a Change in Control, each
Holder of Notes shall have the right (the "Repurchase Right"), at the
Holders' option, to require the Company to repurchase all or any
portion of such Holder's Notes, in integral multiples of $1,000, at
the Put Price in cash, in accordance with and subject to the terms of
this Section 1006. Such repurchase shall occur on the date (the
"Repurchase Date") that is 45 days after the date of the Company
Notice hereinafter described. The Company will mail a notice
containing the information set forth in Subsection 1006(b) below (the
"Company Notice") to all Holders of Notes within 30 days following any
Change in Control, and the Company will purchase all tendered Notes by
making payment of the Put Price on the Repurchase Date. The Company
shall promptly deliver a copy of the Company Notice to the Trustee and
shall cause a copy of such notice to be published in The Wall Street
Journal or another newspaper of national circulation.
(b) The Company Notice shall state:
(i) that a Change in Control has occurred and
that each Holder of Notes has the right to require the
Company to repurchase such Holder's Note at the Put Price in
cash;
(ii) the circumstances and relevant facts
regarding such Change in Control;
(iii) the Repurchase Date and the instructions a
Holder of Notes must follow in order to have such Holder's
Notes repurchased in accordance with this Section 1006;
(iv) that any Note not tendered will continue to
accrue interest;
(v) that on the Repurchase Date any Note
tendered for payment pursuant to the terms hereof and for
which money sufficient to pay the Put Price has been
deposited with the Trustee, as provided in this Section
1006, shall cease to accrue interest after the Repurchase Date;
(vi) that Holders electing to have a Note
repurchased pursuant to this Section 1006 will be required
to surrender the Note, duly endorsed for transfer, together
with an irrevocable written notice in the form entitled
"Election to Exercise Repurchase Right Upon a Change in
Control" on the reverse of the Note, to the Company (or an
agent designated by the Company for such purpose) at the
address specified in the Company Notice and the Trustee on
or prior to the close of business on the 30th day after the
date of the Company Notice; and
(vii) such other information as may be required
by applicable law and regulations;
provided that no failure of the Company to give the foregoing notices
and no defect therein shall limit the Repurchase Rights or affect the
validity of the proceedings for the repurchase of the Notes pursuant
to this Section 1006.
(c) Following a Change in Control, the Company shall
accept for payment Notes properly tendered pursuant to this Section
1006. Prior to the Repurchase Date, the Company shall deposit with
the Trustee money sufficient to pay the Put Price for all Notes (or
portions thereof) so tendered and deliver, or cause to be delivered,
to the Trustee Notes properly tendered pursuant to this Section 1006
and accepted together with an Officers' Certificate describing the
Notes so tendered to and being purchased by the Company. On the
Repurchase Date, the Trustee shall, to the extent that monies
deposited with the Trustee are available therefor, mail to the Holders
of Notes so tendered and accepted for payment an amount equal to the
Put Price and, as soon as possible after such payment, the Trustee
shall cancel the Notes so tendered and accepted. The Company will
publicly announce the results of the Change in Control tender offer as
soon as practicable after the Repurchase Date. The Company will issue
to Holders whose Notes are purchased only in part new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.
(d) Notwithstanding the foregoing, in repurchasing the
Notes pursuant to this Section 1006, the Company will comply with all
applicable tender offer rules, including but not limited to Sections
13(e) and 14(e) under the Exchange Act and Rules 13e-1 and 14e-1
thereunder.
(e) Each Holder of Notes properly tendered for purchase
pursuant to this Section 1006 who is not paid the Put Price for such
Notes in the manner described in Subsection 1006(c) will be entitled
to receive (as part of any subsequent payment of the Put Price prior
to the earlier of (i) the date such Holder's election to require the
Company to purchase such Notes is withdrawn or (ii) the date all
outstanding Notes are accelerated under Section 502 or an Event of
Default under subsection 501(4) or 501(5) shall occur) interest on the
entire principal of such outstanding Notes at the rate provided in
such Outstanding Notes through the date the Put Price is paid, to the
extent not theretofore paid on such Notes in accordance with their
terms.
(f) The Company is solely responsible for performing the
duties and responsibilities contained in this Section 1006, other than
the obligations of the Trustee specifically set forth in Subsection
1006(c). The Trustee shall not be responsible for any failure of the
Company to make any deposit with the Trustee or to deliver to the
Trustee Notes tendered pursuant to this Section 1006 or, subject to
Section 601, any failure of the Company to comply with any of the
other covenants of the Company contained in this Section 1006.
Section 2.4 Amendments to Article 16. (a) Section
1605(c) of the Indenture is hereby amended by deleting the second
parenthetical phrase thereof and replacing it with the following
parenthetical phrase: "(excluding cash dividends or cash
distributions)".
(b) Section 1605 of the Indenture is hereby amended by
adding, immediately following subsection (c) thereof, the following
new subsection (d):
(d) In case the Company shall pay to substantially
all holders of its Common Stock cash dividends and other
distributions exclusively in cash within any 12-month period and
the aggregate per share amount of such dividends and distributions
during such 12-month period in respect of which no conversion
price or conversion rate adjustment pursuant to this Subsection
(d) has been made previously shall exceed the greater of (x) $1.00
per share and (y) 15% of the closing price per share of the Common
Stock, calculated, with respect to each such dividend or
distribution within such 12-month period, as of the last Trading
Day prior to the declaration date for each such dividend or
distribution (such greater amount, the "Threshold Amount"), then,
except as provided in subsection (f) below, in each such case the
conversion price or conversion rate shall be adjusted by
multiplying the conversion price or dividing the conversion rate,
as the case may be, in effect immediately prior to the record date
for the determination of stockholders entitled to receive the
dividend or distribution that causes aggregate per share dividends
and distributions in the applicable 12-month period to exceed the
Threshold Amount by a fraction of which the numerator shall be the
current market price per share (as defined in subsection (e)
below) of the Common Stock on such record date less the amount of
cash by which such aggregate per share dividends or distributions
exceed the Threshold Amount and the denominator shall be the
current market price per share of the Common Stock on such record
date. Such adjustment shall become effective immediately after
the record date for the determination of stockholders entitled to
receive the dividend or distribution that causes aggregate per
share dividends and distributions in the applicable 12-month
period to exceed the Threshold Amount, except as provided in
subsection (f) below.
(c) Subsections (d) through (g) of Section 1605 are hereby
renamed subsections (e) through (h), respectively, and all cross
references to such subsections found elsewhere in Article 16 shall be
amended accordingly.
Section 2.5 Other Provisions Unchanged. All Provisions
of the Indenture, other than as set forth in Sections 2.1 through 2.4,
inclusive, of this First Supplemental Indenture shall be unchanged by
this First Supplemental Indenture and shall remain in full force and
effect. The Indenture, as supplemented and amended by this First
Supplemental Indenture, is in all respects ratified and confirmed, and
the Indenture and this First Supplemental Indenture shall be read,
taken and construed as one and the same instrument.
Section 2.6 Ranking. The Notes will be unsecured
general obligations of the Company, subordinate in right of payment to
certain other obligations of the Company.
Miscellaneous
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Section 3.1 Defined Terms. Unless otherwise provided in
this First Supplemental Indenture, all defined terms used in this
First Supplemental Indenture shall have the meanings assigned to them
in the Indenture.
Section 3.2 Conflict of Any Provision of Indenture with
Trust Indenture Act of 1939. If and to the extent that any provision
of this First Supplemental Indenture limits, qualifies or conflicts
with another provision included in this First Supplemental Indenture
or in the Indenture which is required to be included herein or therein
by any of Section 310 to 317, inclusive, of the Trust Indenture Act of
1939, such required provision shall control.
Section 3.3 New York Law to Govern. THIS FIRST
SUPPLEMENTAL INDENTURE AND THE NOTES, SHALL BE DEEMED TO BE CONTRACTS
MADE AND TO BE PERFORMED ENTIRELY IN THE STATE OF NEW YORK, AND FOR
ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF SAID STATE WITHOUT REGARD TO THE CONFLICTS OF LAW RULES OF
SAID STATE.
Section 3.4 Counterparts. This First Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute
but one and the same instrument.
Section 3.5 Effect of Headings. The Article and Section
headings herein are for convenience only and shall not affect the
construction hereof.
Section 3.6 Severability of Provisions. In case any
provision in this First Supplemental Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 3.7 Successors and Assigns. All covenants and
agreements in this First Supplemental Indenture by the parties hereto
shall bind their respective successors and assigns and inure to the
benefit of their respective successors and assigns, whether so
expressed or not.
Section 3.8 Benefit of Supplemental Indenture. Nothing in
this First Supplemental Indenture, express or implied, shall give to
any Person, other than the parties hereto, any Security Registrar, any
Paying Agent and their successors hereunder, and the Holders of the
Notes, any benefit or any legal or equitable right, remedy or claim
under this First Supplemental Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this
First Supplemental Indenture to be duly executed, all as of the day
and year first above written.
UNISYS CORPORATION
By: _______________________________
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By: _______________________________
Name:
Title: