<PAGE>   1
                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-Q/A

                                AMENDMENT NO. 1

                               (Amending Item 1)

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

                       For the Quarter Ended June 30, 2001

                 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                               OF THE EXCHANGE ACT

        For the transition period from            to
                                       ----------    ----------

                         Commission file number 0-22190

                     ---------------------------------------

                            VERSO TECHNOLOGIES, INC.
             (Exact name of Registrant as specified in its charter)


                MINNESOTA                                 41-1484525
       (State or other jurisdiction         (I.R.S. Employer Identification No.)
    of incorporation or organization)


               400 Galleria Parkway, Suite 300, Atlanta, GA 30339
                    (Address of principal executive offices)

                                 (678) 589-3500
                           (Issuer's telephone number)

                     --------------------------------------

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [ ].

Shares of the Registrant's Common Stock, par value $.01 per share, outstanding
as of August 11, 2001: 51,748,415.

<PAGE>   2

                            VERSO TECHNOLOGIES, INC.
                                  FORM 10-Q/A
                                AMENDMENT NO. 1

                                      INDEX


<TABLE>
<CAPTION>
                                                                                       Page No.
                                                                                       --------
<S>                                                                                    <C>
Part I. FINANCIAL INFORMATION
   Item 1.

         Condensed Consolidated Balance Sheets as of June 30, 2001 and
          December 31, 2000.......................................................         2

         Condensed Consolidated Statements of Operations for the three months
          and for the six months ended June 30, 2001 and 2000.....................         3

         Condensed Consolidated Statements of Cash Flows for the six months
          ended June 30, 2001 and 2000............................................         4

         Notes to the Condensed Consolidated Financial Statements.................         6

   Signature Page.................................................................        15
</TABLE>

<PAGE>   3
                                EXPLANATORY NOTE

This Report on Form 10-Q/A amends and restates in its entirety Item 1 of the
Quarterly Report on Form 10-Q of Verso Technologies, Inc., a Minnesota
corporation ("Verso" or the "Company"), for the quarter ended June 30, 2001.


                       PART I-ITEM 1: FINANCIAL STATEMENTS


                            VERSO TECHNOLOGIES, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)
                        (IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                                                        JUNE 30,           DECEMBER 31,
                                                                                          2001                 2000
                                                                                       ----------          ------------
<S>                                                                                    <C>                 <C>
ASSETS:
Current assets:
      Cash and cash equivalents                                                        $    3,081           $   10,959
      Accounts receivable, net                                                              7,951               15,204
      Other current assets                                                                  3,458                4,048
      Net assets of discontinued operations                                                    --                7,066
                                                                                       ----------           ----------

          Total current assets                                                             14,490               37,277



Property and equipment, net                                                                 8,658                9,045
Intangibles, net                                                                           13,618              120,541
                                                                                       ----------           ----------

            Total assets                                                               $   36,766           $  166,863
                                                                                       ==========           ==========

LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
      Current portion of convertible subordinated debentures, net of discount          $      484           $    6,348
      Accounts payable                                                                      3,182                6,557
      Accrued compensation                                                                  1,024                2,829
      Accrued expenses                                                                      6,195                5,217
      Unearned revenue and customer deposits                                                2,848                3,716
                                                                                       ----------           ----------

          Total current liabilities                                                        13,733               24,667

Convertible subordinated debentures, net of current portion and discount                    3,291                3,153
                                                                                       ----------           ----------

          Total liabilities                                                                17,024               27,820
                                                                                       ----------           ----------

Shareholders' equity:
      Common stock, $.01 par value, 100,000,000 shares authorized;
          51,326,284 and 49,615,133 shares issued and outstanding                             513                  496
      Additional paid-in capital                                                          252,515              249,340
      Accumulated deficit                                                                (228,225)            (104,516)
      Deferred compensation                                                                (5,061)              (6,277)
                                                                                       ----------           ----------

          Total shareholders' equity                                                       19,742              139,043
                                                                                       ----------           ----------

            Total liabilities and shareholders' equity                                 $   36,766           $  166,863
                                                                                       ==========           ==========
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.


                                       2
<PAGE>   4


                            VERSO TECHNOLOGIES, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                        (IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                            FOR THE THREE MONTHS ENDED JUNE 30,   FOR THE SIX MONTHS ENDED JUNE 30,
                                                                 2001                 2000            2001                 2000
                                                             ------------         ------------    ------------         ------------
<S>                                                          <C>                  <C>             <C>                  <C>
Revenue:
  Services                                                   $      6,442         $      9,053    $     14,091         $     16,461
  Products                                                          2,443                8,676           5,315               19,337
                                                             ------------         ------------    ------------         ------------
    Total revenue                                                   8,885               17,729          19,406               35,798

Cost of revenue:
  Services                                                          5,155                7,719          10,992               11,896
  Products                                                          2,034                8,333           4,353               17,601
                                                             ------------         ------------    ------------         ------------
    Total cost of revenue                                           7,189               16,052          15,345               29,497

Gross profit:
  Services                                                          1,287                1,334           3,099                4,565
  Products                                                            409                  343             962                1,736
                                                             ------------         ------------    ------------         ------------
    Gross profit                                                    1,696                1,677           4,061                6,301

Operating expenses:

  Sales, general and administrative                                 6,177               12,175          12,309               20,148
  Depreciation                                                        647                  503           1,335                  747
  Amortization of intangibles                                      11,052                  351          22,114                  702
  Loss on asset abandonment                                            --                   42              --                   42
  Write-down of goodwill                                           85,000                   --          85,000                   --
  Reorganization costs                                              3,750                1,500           3,750                1,500
  Amortization of deferred compensation                               608                   --           1,216                   --
                                                             ------------         ------------    ------------         ------------

    Total operating expenses                                      107,234               14,571         125,724               23,139

                                                             ------------         ------------    ------------         ------------
       Operating loss from continuing operations                 (105,538)             (12,894)       (121,663)             (16,838)

Interest expense, net, including $116, $123, $353 and $139
  of amortization of loan fees and discount on convertible
  subordinated debentures in the three months and the six
  months ended June 30, 2001 and 2000                                 163                  194             406                  288
                                                             ------------         ------------    ------------         ------------

      Loss from continuing operations before income taxes
        and extraordinary item                                   (105,701)             (13,088)       (122,069)             (17,126)

Income taxes                                                           --                   --              --                   --
                                                             ------------         ------------    ------------         ------------

      Loss from continuing operations before extraordinary
        item                                                     (105,701)             (13,088)       (122,069)             (17,126)
                                                             ------------         ------------    ------------         ------------

Discontinued operations:

  Loss from discontinued operations, net of income taxes               --               (2,747)             --               (3,948)

  Loss on disposal of discontinued operations, net of
      income taxes                                                     --              (10,500)             --              (10,500)
                                                             ------------         ------------    ------------         ------------

      Total discontinued operations, net of income taxes               --              (13,247)             --              (14,448)
                                                             ------------         ------------    ------------         ------------

       Loss before extraordinary item                            (105,701)             (26,335)       (122,069)             (31,574)

Extraordinary item - loss from debt conversion                         --                   --           1,640                   --
                                                             ------------         ------------    ------------         ------------

        Net loss                                             $   (105,701)        $    (26,335)   $   (123,709)        $    (31,574)
                                                             ============         ============    ============         ============

Net loss per common share - basic and diluted:

  Loss from continuing operations before extraordinary
      item                                                   $      (2.07)        $      (0.51)   $      (2.40)        $      (0.69)
  Loss from discontinued operations                                    --                (0.11)             --                (0.16)
  Loss on disposal of discontinued operations                          --                (0.41)             --                (0.42)
                                                             ------------         ------------    ------------         ------------
  Loss before extraordinary item                                    (2.07)               (1.03)          (2.40)               (1.27)
  Extraordinary item - loss from debt conversion                       --                   --           (0.03)                  --
                                                             ------------         ------------    ------------         ------------

Net loss per common share - basic and diluted                $      (2.07)        $      (1.03)   $      (2.43)        $      (1.27)
                                                             ============         ============    ============         ============

Weighted average shares outstanding - basic and diluted        51,120,684           25,511,858      50,829,910           24,789,876
                                                             ============         ============    ============         ============
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.


                                       3
<PAGE>   5

                            VERSO TECHNOLOGIES, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)

                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                                  FOR THE SIX MONTHS ENDED JUNE 30,
                                                                                                     2001                   2000
                                                                                                  ----------             ----------
<S>                                                                                               <C>                    <C>
OPERATING ACTIVITIES:

     Continuing operations:
          Net loss from continuing operations                                                     $ (123,709)            $  (17,126)
          Adjustments to reconcile net loss from continuing operations to net
             cash used in continuing operating activities:
               Extraordinary item - loss on debt conversion                                            1,640                     --
               Amortization of intangibles                                                            22,114                    702
               Write-down of goodwill                                                                 85,000                     --
               Depreciation                                                                            1,335                    747
               Amortization of deferred compensation                                                   1,216                     --
               Provision for doubtful accounts                                                         2,517                  1,619
               Amortization of loan fees and discount on convertible subordinated debentures             353                    139
               Other                                                                                      (2)                    54
               Changes in current operating items:
                  Accounts receivable, net                                                             4,736                 (4,507)
                  Inventories, net                                                                       819                    311
                  Other current assets                                                                  (744)                  (837)
                  Accounts payable                                                                    (3,400)                 7,122
                  Accrued compensation                                                                (1,805)                   481
                  Accrued expenses                                                                       659                   (194)
                  Unearned revenue and customer deposits                                                (868)                (2,431)
                                                                                                  ----------             ----------

               Net cash used in continuing operating activities                                      (10,139)               (13,920)
                                                                                                  ----------             ----------

     Discontinued operations:
          Loss from discontinued operations                                                               --                (14,448)
          Estimated loss on disposal of discontinued operations                                           --                 10,500
          Adjustment to reconcile loss from discontinued operations
             to net cash (used in) provided by discontinued operating activities                        (634)                 1,889
                                                                                                  ----------             ----------

               Net cash used in discontinued operating activities                                       (634)                (2,059)
                                                                                                  ----------             ----------

               Net cash used in operating activities                                                 (10,773)               (15,979)
                                                                                                  ----------             ----------

INVESTING ACTIVITIES:

     Continuing operations:
          Net cash used in investing activities for continuing operations -
             Purchases of property and equipment, net                                                   (947)                (6,286)
                                                                                                  ----------             ----------

               Net cash used in investing activities for continuing operations                          (947)                (6,286)

     Discontinued operations:
          Software development costs capitalized, net                                                     --                 (1,738)
          Purchases of property and equipment, net                                                        --                   (195)
          Net proceeds from sale of discontinued operations                                            8,158                     --
                                                                                                  ----------             ----------

             Net cash provided by (used in) investing activities for discontinued operations           8,158                 (1,933)
                                                                                                  ----------             ----------

             Net cash provided by (used in) investing activities                                       7,211                 (8,219)
                                                                                                  ----------             ----------

               Net cash used in operating and investing activities, carried forward                   (3,562)               (24,198)
                                                                                                  ----------             ----------
</TABLE>


                                       4
<PAGE>   6

                            VERSO TECHNOLOGIES, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                  FOR THE SIX MONTHS ENDED JUNE 30,
                                                                                                     2001                   2000
                                                                                                  ----------             ----------
<S>                                                                                               <C>                    <C>
NET CASH USED IN OPERATING AND INVESTING ACTIVITIES, CARRIED FORWARD                                  (3,562)               (24,198)
                                                                                                  ----------             ----------


FINANCING ACTIVITIES:

     Continuing operations:
          Payments on long-term debt                                                                      --                   (261)
          Borrowings on credit line, net                                                                  --                  3,622
          Payments on convertible subordinated debentures                                             (4,500)                    --
          Advance from Cereus Technology Partners, Inc. prior to merger                                   --                  4,000
          Proceeds from issuances of common stock, net                                                   184                 16,709
                                                                                                  ----------             ----------
             Net cash (used in) provided by financing activities
               for continuing operations                                                              (4,316)                24,070
                                                                                                  ----------             ----------

     Discontinued operations:
          Net cash used in financing activities for discontinued operations -
             Payments on long-term debt                                                                   --                    (45)
                                                                                                  ----------             ----------

             Net cash (used in) provided by financing activities                                      (4,316)                24,025
                                                                                                  ----------             ----------

             Decrease in cash and cash equivalents                                                    (7,878)                  (173)

CASH AND CASH EQUIVALENTS:
Beginning of period                                                                                   10,959                    613
                                                                                                  ----------             ----------

End of period                                                                                     $    3,081             $      440
                                                                                                  ==========             ==========

CASH AND CASH EQUIVALENTS:
     Continuing operations                                                                        $    3,081             $       --
     Discontinued operations                                                                              --                    440
                                                                                                  ----------             ----------

          Total cash and cash equivalents                                                         $    3,081             $      440
                                                                                                  ==========             ==========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

     CASH PAYMENTS DURING THE PERIOD FOR:

          Interest                                                                                $       53             $      483
                                                                                                  ==========             ==========

          Income taxes                                                                            $       14             $      221
                                                                                                  ==========             ==========

     NON-CASH INVESTING AND FINANCING ACTIVITIES


          Common stock and compensatory
             options issued in reorganization                                                     $       21             $      556
                                                                                                  ==========             ==========

          Issuance of warrants in exchange for services                                           $       92             $       --
                                                                                                  ==========             ==========

          Issuance of common stock in exchange for services                                       $       19             $       --
                                                                                                  ==========             ==========

          Conversion of subordinated debentures to common stock - issuance of 1,496,598
             shares of common stock and 945,378 common stock warrants                             $    2,877             $       --
                                                                                                  ==========             ==========
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.


                                       5
<PAGE>   7

                            VERSO TECHNOLOGIES, INC.

            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                  June 30, 2001

1.       BASIS OF PRESENTATION

         The accompanying unaudited condensed consolidated financial statements
         have been prepared by Verso Technologies, Inc., (formerly known as
         Eltrax Systems, Inc.) - (the "Company" or "Verso") in accordance with
         accounting principles generally accepted in the United States of
         America, pursuant to the rules and regulations of the Securities and
         Exchange Commission. Pursuant to such rules and regulations, certain
         financial information and footnote disclosures normally included in the
         financial statements have been condensed or omitted.

         In the opinion of management, the accompanying unaudited condensed
         consolidated financial statements contain all necessary adjustments,
         consisting only of those of a recurring nature, and disclosures to
         present fairly the Company's financial position as of June 30, 2001,
         and its results of operations and cash flows for the periods ended June
         30, 2001 and 2000.

         The Company historically operated through two separate business units:
         the Technology Services Group and the Hospitality Services Group
         ("HSG"). On July 19, 2000, the Company's Board of Directors authorized
         the disposition of HSG and in the first quarter of 2001 the sale of all
         of HSG was completed. HSG is reported as a discontinued operation and
         the consolidated financial statements have been reclassified to
         segregate the net assets and operating results of this business
         segment. Technology Services Group and corporate operations are
         reflected in continuing operations.

         The condensed consolidated financial statements include the accounts of
         Verso Technologies, Inc. and its wholly-owned subsidiaries, including
         Cereus Technology Partners, Inc. ("Cereus") and its subsidiaries, which
         merged with the Company on September 29, 2000, and MessageClick, Inc.
         ("MessageClick"), which merged with the Company on November 22, 2000,
         each in transactions accounted for as purchases. Significant
         intercompany transactions have been eliminated. Certain prior year
         amounts in the consolidated financial statements and notes have been
         reclassified to conform with the current year presentation. These
         reclassifications had no effect on previously reported net income
         (loss) or shareholders' equity.

         The year-end condensed consolidated balance sheet was derived primarily
         from audited consolidated financial statements, but does not include
         all disclosures required by generally accepted accounting principles.
         For further information, refer to the consolidated financial statements
         and footnotes thereto included in the Company's annual report on Form
         10-K for the year ended December 31, 2000.


                                       6
<PAGE>   8

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

2.       MERGERS AND ACQUISITIONS

         MessageClick, Inc.

         On November 22, 2000, the Company acquired MessageClick, Inc. The
         purchase consideration was approximately $4.2 million, consisting of
         1,405,923 shares of the Company's common stock with a fair value of
         $3.2 million, warrants to acquire 181,901 shares of the Company's
         common stock with an exercise price of $4.03 per share (estimated fair
         value of $301,000 using the Black-Scholes option pricing model based on
         the following weighted-average assumptions: expected volatility - 88%;
         expected life - five years; risk-free interest rate - 5.5%; and
         expected dividend yield - 0%), cash of $5,000 and acquisition costs of
         approximately $637,000.

         The acquisition was treated as a purchase for accounting purposes, and,
         accordingly, the assets and liabilities were recorded at their fair
         value at the date of the acquisition. The excess of the purchase price
         over the estimated fair value of net liabilities acquired totaled
         approximately $9.8 million and was allocated to goodwill. The goodwill
         has historically been amortized over three years (See Notes 6 and 7).

         Prior to the Company's mergers with Cereus (as described below) and
         MessageClick, Cereus purchased 3,000,000 shares of MessageClick's
         Series E Preferred Stock for an aggregate purchase price of $1,500,000.


                                       7
<PAGE>   9

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

2.       MERGERS AND ACQUISITIONS, Continued

         Cereus Technology Partners, Inc.

         On September 29, 2000, the Company acquired all of the outstanding
         capital stock of Cereus. The purchase consideration was approximately
         $134.1 million, consisting of 21,866,600 shares of the Company's common
         stock with a fair value of $106.6 million, assumed options and warrants
         to acquire 20,947,900 shares of the Company's common stock with
         exercise prices ranging from $.51 to $10.14 per share (estimated fair
         value of $35.8 million, net of $6.9 million of deferred compensation
         discussed in Note 9, using the Black-Scholes option pricing model based
         on the following weighted-average assumptions: expected volatility -
         88%; expected life - five years; risk-free interest rate - 5.5%; and
         expected dividend yield - 0%) and acquisition costs of approximately
         $1.9 million, reduced by a $10.2 million bridge facility advanced to
         the Company by Cereus prior to closing. The bridge facility accrued
         interest at 2% over prime and the Company recorded interest expense,
         prior to the closing of the transaction, of approximately $261,000
         during the year ended December 31, 2000.

         The acquisition was treated as a purchase for accounting purposes, and,
         accordingly, the assets and liabilities were recorded at their fair
         value at the date of the acquisition. The excess of the purchase price
         over the estimated fair value of net assets acquired totaled
         approximately $113.0 million and was allocated to goodwill. The
         goodwill has historically been amortized over three years (See Notes 7
         and 11).

         Pro Forma Effect of MessageClick and Cereus Transactions

         The following unaudited pro forma information presents the results of
         continuing operations of the Company for the six months ended June 30,
         2000, as if the acquisitions above had taken place on January 1, 2000,
         (in thousands, except per share amounts):

<TABLE>
                  <S>                                             <C>
                  Revenues                                        $     40,392
                  Loss from continuing operations                 $    (48,250)
                  Loss from continuing operations
                    per common share
                                     -basic and diluted           $      (1.00)
                  Weighted average shares outstanding
                                     -basic and diluted             48,062,399
</TABLE>


                                       8
<PAGE>   10

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

3.       DISCONTINUED OPERATIONS

         On July 19, 2000, the Company's board of directors formally determined
         to dispose of HSG. In December 2000, the Company completed the sale of
         its domestic lodging business and international hospitality business
         for aggregate proceeds of $10.0 million. The Company sold its
         restaurant solutions business for aggregate proceeds of $8.5 million in
         January 2001. HSG is reported as a discontinued operation, and the
         consolidated financial statements have been reclassified to segregate
         the net assets and operating results of the business segment.

         The loss on the sale of HSG totaled $11.0 million and was recorded in
         the third and fourth quarters of 2000. The loss included a reduction in
         asset values of approximately $4.3 million and a provision for
         anticipated closing costs and operating losses until disposal of
         approximately $6.7 million.

         Summary operating results of the discontinued operations for the three
         months and six months ended June 30, 2000 (in thousands) are as
         follows:

<TABLE>
<CAPTION>
                                                           Three months ended     Six months ended
                                                              June 30, 2000         June 30, 2000
                                                           ------------------     ----------------
                           <S>                             <C>                    <C>
                           Revenue                              $ 11,481               $ 24,306
                           Gross profit                            4,794                 10,165
                           Operating loss                         (2,296)                (3,357)
                           Interest expense                         (204)                  (334)
                           Loss on disposal of assets                (88)                   (88)
                           Income tax expense                       (159)                  (169)
                                                                --------               --------
                           Loss from
                             discontinued operations            $ (2,747)              $ (3,948)
                                                                ========               ========
</TABLE>

         Net assets held for sale at December 31, 2000 (in thousands) were as
         follows:

<TABLE>
                  <S>                                                    <C>
                  Cash and cash equivalents                              $   196
                  Other current assets                                     9,543

                  Furniture and equipment, net                               685
                  Capitalized software, net                                4,532
                  Intangibles, net                                         1,387
                  Current liabilities                                     (3,694)
                  Reserve for loss on sale and operating losses           (5,784)
                  Accumulated other comprehensive loss                       201
                                                                         -------
                    Net assets of discontinued operations                $ 7,066
                                                                         =======
</TABLE>


                                       9
<PAGE>   11

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

4.       LOAN FACILITY WITH PNC BANK, NATIONAL ASSOCIATION

         In March 2000, the Company obtained a $20.0 million revolving credit
         agreement (the "Credit Agreement") with PNC Bank, National Association
         (the "Bank"). The Credit Agreement is secured by substantially all of
         the assets of the Company. The Credit Agreement was amended in January
         2001 to reduce the availability thereunder to $10.0 million and in
         March 2001 to adjust certain covenants, in connection with the sale of
         HSG. Interest is charged at .5% above the Bank's Base Rate (7.25% at
         June 30, 2001). As amended, the Credit Agreement provides for up to
         $3,000,000 in letters of credit. Advances are limited by a formula
         based on eligible receivables, certain cash balances, outstanding
         letters of credit and certain subjective limitations. Interest payments
         are due monthly, and the Credit Agreement, as amended, expires March
         2003. The Credit Agreement, as amended, includes fees of 3% on
         outstanding letters of credit and .25% on unused available borrowings.
         The Company paid certain loan fees and attorney's fees totaling
         approximately $185,000 in connection with the Credit Agreement, which
         fees are being amortized to interest expense over the term of the
         Credit Agreement, as amended.

         The Company had no borrowings under the Credit Agreement, as amended,
         as of June 30, 2001. The availability under the Credit Agreement, as
         amended, at June 30, 2001 was approximately $2.2 million. Under the
         terms of the Credit Agreement, as amended, the Company is required to
         meet increasing quarterly cash flow requirements, cannot declare
         dividends or incur any additional indebtedness and has annual capital
         expenditure limits. Although the Company was not in compliance with the
         Net Cash Flow required under Section 6.5 of the Credit Agreement for
         the two fiscal quarters ending June 30, 2001, the Bank waived
         compliance with such covenant.

         In connection with the Bank's granting of the waiver for covenant
         non-compliance and the Bank's consent to the NACT Telecommunications,
         Inc. acquisition, the issuance of $15 million of preferred stock to
         Telemate.Net and the Telemate.Net merger, the Company agreed not to
         borrow under the Credit Agreement until it was in compliance with the
         covenants for the third quarter 2001 or had restructured these
         covenants to bring the Company into compliance.

5.       CONVERTIBLE SUBORDINATED DEBENTURES

         In connection with the acquisition of MessageClick, Inc., the Company
         issued to certain investors of MessageClick $4.5 million of the
         Company's 7.5% convertible subordinated debentures and warrants to
         purchase an aggregate of 1,000,000 shares of the Company's common stock
         at an exercise price of $7.39 per share. The debentures are convertible
         into the Company's common stock at a conversion price of $4.45. The
         convertible subordinated debentures are due November 22, 2005. The
         debentures have been discounted to reflect the fair value of the
         warrants issued, totaling approximately $1.4 million, using the
         Black-Scholes option pricing method based on the following
         weighted-average assumptions: expected volatility - 88%; expected life
         - five years; risk-free interest rate - 5.5%; and expected dividend
         yield - 0%. The unamortized discount totaled approximately $1.2 million
         at June 30, 2001. In addition, the Company paid certain private
         placement fees and attorney's fees in connection with the sale of the
         debentures totaling $50,000. The fees are being amortized to interest
         expense over the term of the debentures.


                                       10
<PAGE>   12

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

5.       CONVERTIBLE SUBORDINATED DEBENTURES, Continued

         The Company issued $7.0 million of its 5% convertible subordinated
         debentures during the year ended December 31, 2000. The convertible
         subordinated debentures were issued with warrants to purchase 364,584
         shares of the Company's common stock at an exercise price of $5.03 per
         share. The debentures have been discounted to reflect the fair value of
         the warrants issued, totaling approximately $1.0 million, using the
         Black-Scholes option pricing method based on the following
         weighted-average assumptions: expected volatility - 88%; expected life
         - five years; risk-free interest rate - 5.5%; and expected dividend
         yield - 0%. The unamortized discount totaled approximately $15,700 at
         June 30, 2001. In addition, the Company paid certain private placement
         fees (including 88,712 shares of the Company's common stock with a fair
         value at the date of issuance totaling $350,000) and attorney's fees in
         connection with the sale of the debentures totaling $454,000. The fees
         are being amortized to interest expense over the term of the
         debentures.

         In January 2001, the Company modified the terms of its 5% convertible
         subordinated debentures. According to the modified terms of the
         agreement, the Company repurchased $4.5 million of the outstanding $7.0
         million of its 5% convertible subordinated debentures. Of the remaining
         $2.5 million in outstanding 5% convertible subordinated debentures,
         $1.5 million were converted by the investors into the Company's common
         stock at a price of $1.40 per share. The remaining $1.0 million of 5%
         convertible subordinated debentures (due October 5, 2001) is
         convertible at $1.19 per share. The Company may re-borrow up to $3.5
         million at its option, subject to the satisfaction of certain
         conditions, through the issuance of new 5% convertible debentures,
         which will have a fixed conversion price determined at the time of
         issuance. In connection with this modification, the Company issued
         warrants to purchase 945,378 shares of the Company's common stock at an
         exercise price of $2.00 per share. The fair value of the warrants
         issued, totaled approximately $977,000, using the Black-Scholes option
         pricing method based on the following weighted-average assumptions:
         expected volatility - 91%; expected life - five years; risk-free
         interest rate - 5.5%; and expected dividend yield - 0%. In April 2001,
         $500,000 of the Company's 5% convertible subordinated debentures was
         converted by the investors into the Company's common stock at $1.19 per
         share. In July and August 2001, $500,000 of the Company's 5%
         convertible subordinated debentures was converted by the investors into
         the Company's common stock at $1.19 per share, see Note 11. The cost of
         conversion, including the warrants issued, totaled $1.6 million in the
         six months ended June 30, 2001.


         The cost of conversion consisted of the following:

                 <Table>
                 <S>                                       <C>
                 Fair value of warrants issued .......... $  976,666
                 Write off of related discount ..........    365,307
                 Write off of related loan fees .........    165,390
                 Beneficial conversion ..................    107,485
                 Legal and other costs ..................     25,000
                                                          ----------
                                                          $1,639,848
                                                          ==========
                 </Table>


                                       11
<PAGE>   13

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

6.       REORGANIZATION COSTS

         In the second quarter of 2001, the Company announced that as part of
         its effort to improve operational efficiencies and financial
         performance, it had eliminated approximately 50 positions held by
         employees, closed certain sales offices and reorganized its
         MessageClick unified messaging operations. The Company has decided to
         discontinue offering its MessageClick ASP service and refocus the
         development of this proprietary application to be offered as a licensed
         software product. As a result of these actions, the Company recorded
         reorganization costs of $3.8 million during the three months ended June
         30, 2001. Annualized savings beginning in the third quarter of 2001 are
         expected to be approximately $4.5 million. The reorganization costs
         consist of the following:

<TABLE>
                  <S>                                         <C>
                  Severance costs                             $   517,000
                  Facilities closings                           2,409,000
                  MessageClick related exiting costs              824,000
                                                              -----------
                  Total                                       $ 3,750,000
                                                              ===========
</TABLE>

7.       WRITE-DOWN OF GOODWILL

         During the quarter ended June 30, 2001, the Company determined that it
         was changing its strategic direction from primarily acting as a
         value-added reseller of prepackaged software to pursue opportunities
         the Company believes exist in the next generation networking and
         softswitch technology market. The Company plans to leverage its
         telecommunications and networking expertise to assist clients in
         migrating their networks to deliver IP-based telephony services. The
         Company's change in strategic direction is demonstrated by its
         acquisition, in July 2001, of NACT Telecommunications, Inc., a provider
         of next generation network solutions, including softswitch-based
         gateways, billing systems and application technologies. (See Note 11).
         As a result of its change in strategy, the Company re-evaluated its
         operations obtained through prior acquisition transactions, and
         determined that several operations, such as its business applications
         business, did not add value to the new strategic direction. Management
         evaluated its net intangibles associated with these non-strategic
         operations, and based upon its consolidated operating projections of
         expected future cash flows over a three-year period, discounted using a
         8.0% interest rate, determined that the related net intangibles were
         impaired. Accordingly, the Company recognized a write-down of goodwill
         of $85.0 million during the quarter ended June 30, 2001.


                                       12
<PAGE>   14

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

8.       OTHER EVENTS

         On May 4, 2001, the Company signed a definitive merger agreement for
         the acquisition of Telemate.Net Software, Inc. ("Telemate.Net"). In the
         merger, the Telemate.Net security holders will be entitled to receive a
         number of shares, as defined, of the Company's common stock valued at
         approximately $30.0 million, subject to adjustment if Telemate.Net's
         cash is less than $20.0 million and certain other adjustments.

         The Telemate.Net acquisition will be accounted for as a purchase, and
         the expected closing in the fourth quarter of 2001 is subject to the
         receipt of the approval of the shareholders of Telemate.Net and the
         Company, and other customary closing conditions.

9.       RECENT ACCOUNTING PRONOUNCEMENTS

         In June 2001, the Financial Accounting Standards Board ("FASB") issued
         Statement of Financial Accounting Standards No. 141, "Business
         Combinations" ("SAFS 141"), which is effective for all business
         combinations initiated after June 30, 2001. SFAS 141 requires companies
         to account for all business combinations using the purchase method of
         accounting, recognize intangible assets if certain criteria are met, as
         well as provide additional disclosures regarding business combinations
         and allocation of purchase price. The Company will adopt SFAS No. 141
         as of July 1, 2001, and the impact of such adoption is not anticipated
         to have a material adverse impact on the Company's financial
         statements.

         In June 2001, the FASB issued Statement of Financial Accounting
         Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"),
         which requires non-amortization of goodwill and intangible assets that
         have indefinite useful lives and annual tests of impairments of those
         assets. The statement also provides specific guidance about how to
         determine and measure goodwill and intangible asset impairments, and
         requires additional disclosure of information about goodwill and other
         intangible assets. The provisions of this statement are required to be
         applied starting with fiscal years beginning after December 15, 2001
         and applied to all goodwill and other intangible assets recognized in
         its financial statements at that date. Goodwill and intangible assets
         acquired after June 30, 2001 will be subject to the non-amortization
         provisions of the statement at the date of acquisition. The Company
         will adopt SFAS No. 142 beginning January 1, 2002, and upon adoption
         the Company does not currently anticipate any additional impairment of
         goodwill or other intangible assets capitalized as of June 30, 2001.

10.      LITIGATION

         The Company is involved in claims and proceedings, which are routine
         and which in the aggregate are not deemed material to the Company's
         business or financial affairs.


                                       13
<PAGE>   15

                            VERSO TECHNOLOGIES, INC.

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 2001

11.      SUBSEQUENT EVENTS

         NACT

         On July 27, 2001, the Company acquired NACT Telecommunications, Inc.
         ("NACT"). The purchase consideration was approximately $20.5 million,
         consisting of a cash payment of $14.2 million at closing funded
         primarily by the $15 million preferred stock investment made by
         Telemate.Net, an additional amount payable on March 31, 2002 of up to
         $5.4 million, a commitment to grant to NACT employees in-the-money
         non-qualified options with a value of not less than the sum of $625,000
         and an additional amount equal to the increase in stock price, if any,
         from July 27, 2001 and the date the options can be granted under the
         Company's 1999 Stock Incentive Plan and acquisition costs of
         approximately $400,000.

         According to the terms of the definitive merger agreement with
         Telemate.Net, on July 27, 2001, Telemate.Net purchased $15 million of a
         new series of Verso preferred stock. This purchase was contingent upon
         Verso's successful negotiation of a transaction to acquire NACT.
         The preferred stock maintains a redemption feature which allows
         Telemate.Net to redeem all outstanding preferred stock for cash in the
         amount of $15 million plus an additional premium of $3.75 million on
         or anytime after January 1, 2002. As execution of the redemption
         feature is not considered probable based on current merger activities
         with Telemate.Net, the Company does not anticipate accreting the
         premium redemption value in future periods.

         In addition the Company will pay to the former owner of NACT, no later
         than April 15, 2002, an additional $4.9 million if certain performance
         objectives, as defined, are met. As it is not possible to estimate
         what, if any, payment will be due, no such amounts will be recognized
         until such performance objectives are met. However, when determined,
         this additional purchase price will be recorded as an intangible asset.

         The NACT acquisition will be accounted for as a purchase and the
         Company will record goodwill of approximately $16.0 million.

         Prior to the purchase of NACT, the Company became an NACT reseller
         in the first quarter of 2001. The Company resold NACT soft switching
         systems with product revenues for the six months ended June 30, 2001
         totaling $2.8 million and cost of product sales of $2.2 million.

         Reorganization

         On July 27, 2001, the Company eliminated approximately 70 full-time
         positions. In addition, to more effectively manage the resources
         required for its technology solutions business, the Company has signed
         an agreement with a third party managed services provider to outsource
         certain professional services. The Company previously maintained a
         full-time professional services staff, which was significantly
         underutilized. Additionally, the Company has signed an agreement to
         transition its business applications services and customers to a third
         party. This business is not strategic to the Company's new direction
         and it has not been profitable. In connection with this reorganization,
         the Company will record a restructuring charge between $5.5 million and
         $6.5 million in the third quarter of 2001, inclusive of approximately
         $4.5 million of non-cash charges for abandonment of property and
         equipment and the write-off of deferred compensation related to a
         previous acquisition. Annualized savings beginning in the fourth
         quarter of 2001 are expected to be approximately $6.8 million.

         Conversion of Convertible Subordinated Debentures

         On July 19, 2001, $250,000 of the Company's 5% convertible subordinated
         debentures was converted by the investors into the Company's common
         stock at a price of $1.19 per share. In addition, on August 2, 2001,
         $250,000 of the Company's 5% convertible subordinated debentures was
         converted by the investors into the Company's common stock at a price
         of $1.19 per share.


                                       14
<PAGE>   16

                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                            VERSO TECHNOLOGIES, INC.




Date: October 11, 2001      /s/ Juliet M. Reising
                            ----------------------------------------------------
                            Executive Vice President and Chief Financial Officer
                            (duly authorized signatory and
                            Principal Financial and Accounting Officer)


                                       15