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Unisys (UIS) called a timeout on Friday in its struggle to get out from under $759 million in long-term debt. Until the firm cleans up its balance sheet and the information-technology market picks up, its fate is uncertain.

On Friday, the company said it was able to extend its deadline for refinancing a chunk of loans to June 12 from May 31. The company wants to exchange notes set to expire between 2010 and 2015 for new 12.625% notes due in 2014 to maintain an important source of credit.

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Once a pioneering mainframe computer maker known as Sperry Univac, Unisys now sells data-processing and tech support services to corporate and government clients. The shift from mainframe computers to servers has damped revenue, causing four straight years of losses.

Profits aren't on the near-term horizon for the IT services company, which has cut staff, benefits and research costs. After losing $5.09 per share in 2005, Unisys suffered deficits as high as 81 cents each year from 2006 to 2008. It lost 7 cents in the first quarter.

With shareholder equity of negative $1.4 billion, meaning its debt exceeds its assets, and long-term debt of $759 million as of March 31, a balance sheet clean-up is a life-and-death matter for Unisys.

J. Edward Coleman, who took over as chairman and chief executive officer in October, has been leading the firm's survival efforts. Coleman was previously CEO of computer maker Gateway, which he successfully restructured and sold to Acer of Taiwan.

Unisys has made some strides. It reduced its debt 31% from $1.1 billion at the end of 2008. Analysts expect the company to lose 4 cents this year and ring up a 9-cent profit next year.

With capital spending in the pits, Unisys faces an uphill battle. The company, which generated $5.2 billion in revenue last year, competes with the likes of International Business Machines (IBM) and Computer Sciences (CSC) . They take in $104 billion and $17 billion a year, respectively.

Unisys also provides servers for data centers where it competes with heavyweights Hewlett-Packard (HPQ) and Dell (DELL) .

Cost cuts might make it even more difficult for Unisys to compete. The company has slashed research & development spending by 44% and headcount by 8,000 over the past two years.

The company's shares almost hit $50 as the tech bubble swelled in 1999. The stock has rolled downhill during this decade, reaching a nadir of 28 cents in March. They've been trading for $1.25 to $1.50 in recent weeks.

Unisys will need to overcome some daunting obstacles to turn its operations around. While it's possible, the stock probably isn't a safe investment for now. TheStreet.com Ratings grades the company E-plus, a recommendation to "sell."

TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

Richard Widows will be answering questions on Stockpickr Answers on Wednesday, June 3. Stop by and join in the discussion!

Richard Widows is a senior financial analyst for TheStreet.com Ratings. Prior to joining TheStreet.com, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.