Document:

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                                                                   EXHIBIT 10.73

                          ARBITRATION AWARD AGREEMENT

         THIS ARBITRATION AWARD AGREEMENT (the "Agreement") is entered into as
of the 3rd day of February, 2003, by and between WILLIAM P. O'REILLY
("O'Reilly"), MONTANA CORPORATION, a Michigan corporation ("O'Reilly Consulting
Firm"), and VERSO TECHNOLOGIES, INC., a Minnesota corporation ("Verso").

                              W I T N E S S E T H:

         WHEREAS, the parties hereto are parties to that certain arbitration
proceeding pending before the American Arbitration Association (Case No.
54-199-002862) (the "Proceeding"); and

         WHEREAS, the parties hereto desire to structure the satisfaction and
payment of all amounts (of whatever character or nature) awarded to O'Reilly and
the O'Reilly Consulting Firm (collectively, the "Claimants") in the Proceeding
(the "Award") as hereinafter set forth;

         NOW, THEREFORE, in consideration of the mutual terms and conditions
contained herein and other good and valuable consideration, the receipt and
adequacy of which the parties hereby acknowledge, the parties hereto agree as
follows:

         SECTION 1. AWARD SATISFACTION AND PAYMENT. The satisfaction and payment
of any Award shall be based on the aggregate amount of the Award to the
Claimants as follows:

                (a) Within three (3) business days of the execution of this
Agreement, Verso shall cause to be delivered to O'Reilly 275,000 unregistered
shares (the "Base Shares") of Verso's common stock, $.01 par value per share
(the "Common Stock"). If the aggregate amount of the Award to the Claimants is
less than or equal to $125,000, then the delivery of the Base Shares to O'Reilly
shall be full and final satisfaction of the Award.

                (b) If the amount of the Award to the Claimants is greater
than $125,000, then Verso shall satisfy and pay the Award by (i) the delivery of
the Base Shares to O'Reilly; and (ii) entering into, and performing its
obligations under, a consulting agreement with O'Reilly in substantially the
form attached hereto as Exhibit A (the "O'Reilly Consulting Agreement"). The
number to be inserted in Section 4.1 of the O'Reilly Consulting Agreement shall
be calculated in the manner set forth in Section 2 below.

                (c) The Claimants agree that the amounts (and the form
thereof) to be paid to O'Reilly pursuant to this Agreement (and the O'Reilly
Consulting Agreement, if applicable) in respect of the Award are in lieu, and in
complete satisfaction, of the Award, and each Claimant hereby irrevocably waives
its right to enforce the Award other than through the enforcement of this
Agreement and the Consulting Agreement (if applicable).

         SECTION 2. O'REILLY CONSULTING AGREEMENT.

                (a) As soon as the Award is finalized, Verso and O'Reilly
shall calculate the numbers to be inserted into Section 4.1 of the O'Reilly
Consulting Agreement, as set forth

<PAGE>

below, shall insert those numbers, and shall execute and deliver the O'Reilly
Consulting Agreement. The numbers to be inserted in Section 4.1 of the O'Reilly
Consulting Agreement shall be calculated as follows:

                (i) The number to be set forth in Section 4.1A of the
Consulting Agreement shall be equal to 140,000 multiplied by the Multiplier (as
determined below);

                (ii) The number to be set forth in Section 4.1B of the
Consulting Agreement shall be equal to 140,000 multiplied by the Multiplier (as
determined below); and

                  (iii) The number to be set forth in Section 4.1C of the
Consulting Agreement shall be equal to 70,000 multiplied by the Multiplier (as
determined below).

         (b) For the purposes of this Section 2, the Multiplier shall be equal
to (i) the quantity equal the Award minus $125,000, divided by (ii) $275,000,
but the Multiplier shall not be less than zero nor greater than one (1). The
following are examples of the calculation of the Multiplier:

                  (i) If the Award is $262,500, then the Multiplier is equal to
$262,500, minus $125,000 (which is $137,500), divided by $275,000 (which results
in the Multiplier being equal to 0.5 in this example);

                  (ii) If the Award is $125,000, then the Multiplier is equal to
$125,000, minus $125,000 (which is zero), divided by $275,000 (which results in
the Multiplier being equal to zero in this example); and

                  (iii) If the Award is $525,000, then the Multiplier is equal
to $525,000, minus $125,000 (which is $400,000), divided by $275,000 (which
results in the Multiplier being equal to 1.45, but the Multiplier cannot be
greater than one, and, therefore, the Multiplier equals one (1) in this
example).

         (c) Notwithstanding anything herein to the contrary, with the prior
consent of O'Reilly, Verso shall have the right to accelerate the payment of any
amounts due under the Consulting Agreements and any such payment shall be
reduced to the present value thereof based on a time value of money factor equal
to five percent (5%) per annum calculated by reference to the original due date
of the payment so accelerated.

         SECTION 3. REPRESENTATIONS AND WARRANTIES OF VERSO. Verso hereby
represents and warrants to the Claimants as follows:

                (a) Verso is a corporation duly organized, validly existing
and in good standing under the laws of the State of Minnesota.

                (b) Verso has the right, power and capacity to execute,
deliver and perform this Agreement and the O'Reilly Consulting Agreement
(collectively, the "Transaction Documents") and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance by
Verso of the Transaction Documents, and the

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consummation of the transactions contemplated thereby, have been duly and
validly authorized by all necessary corporate action on the part of Verso. This
Agreement has been, and the other Transaction Documents will be, duly and
validly executed and delivered by Verso and constitute Verso's legal, valid and
binding obligation, enforceable in accordance with its and their terms.

                (c) The execution and delivery of this Agreement by Verso and
the other Transaction Documents, the consummation by Verso of the transactions
contemplated herein and therein, and the performance of the covenants and
agreements of Verso contained herein and therein will not, with or without the
giving of notice or the lapse of time, or both, (i) violate or conflict with any
of the provisions of the articles of incorporation or bylaws of Verso, (ii)
violate, conflict with or result in a breach or default under or cause
termination of any term or condition of any mortgage, indenture, contract,
license, permit, instrument or other agreement to which Verso is a party or by
which Verso or any of its assets may be bound, or (iii) violate any provision of
law, statute, rule, regulation, court order, judgment or decree, or ruling of
any governmental authority, to which Verso is a party or by which Verso or any
of its assets may be bound.

                  (d) Any shares of Common Stock issued to O'Reilly pursuant to
the terms and conditions of any of the Transaction Documents shall be, when
issued, duly and validly issued, fully-paid and non-assessable.

         SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE CLAIMANTS. (a) Each
Claimant (as to itself or himself, as the case may be) hereby represents and
warrants to Verso as follows:

                  (i)      If Claimant is corporation, it is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation.

                  (ii)     Each Claimant has the right, power and capacity to
execute, deliver and perform this Agreement and the other Transaction Documents
to which it is a party and to consummate the transactions contemplated hereby
and thereby. The execution, delivery and performance of this Agreement and the
other Transaction Documents to which such Claimant is a party, and the
consummation of the transactions contemplated hereby and thereby, have been duly
and validly authorized by all necessary action (corporate or otherwise, as the
case may be) on the part of such Claimant. This Agreement has been, and the
other Transaction Documents to which such Claimant is a party shall be, duly and
validly executed and delivered by such Claimant and constitute such Claimant's
legal, valid and binding obligation, enforceable in accordance with its and
their terms.

                  (iii)    The execution and delivery by such Claimant of this
Agreement and the other Transaction Documents to which such Claimant is a party,
the consummation of the transactions contemplated herein and therein by such
Claimant, and the performance of the covenants and agreements of the such
Claimant will not, with or without the giving of notice or the lapse of time, or
both (i) violate or conflict with, in the case of the O'Reilly Consulting Firm,
any of the provisions of its certificate of incorporation or bylaws, (ii)
violate, conflict with or result in a breach or default under or cause
termination of any term or condition of any mortgage, indenture, contract,
license, permit, instrument or other agreement to which such Claimant is a party
or by which such Claimant or any of its assets may be bound or (iii) violate any
provision

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of law, statute, rule, regulation, court order, judgment or decree, or
ruling of any governmental authority, to which such Claimant is a party or by
which such Claimant or any of its assets may be bound.

         (b)      O'Reilly represents and warrants to Verso that he is acquiring
the shares of Common Stock hereunder or under the O'Reilly Consulting Agreement
(collectively, the "Shares") for his own account as principal, for investment
purposes only, and not with a view to, or for, resale, distribution or
fractionalization thereof, in whole or in part.

         (c)      O'Reilly acknowledges its understanding that the offering and
sale of the Shares is intended to be exempt from registration under the
Securities Act of 1933, as amended (the "1933 Act"), by virtue of Section 4(2)
of the 1933 Act and the provisions of Regulation D thereunder, and in
furtherance thereof, such Claimant represents and warrants to, and agrees with,
Verso as follows:

                  (i)      O'Reilly has the financial ability to bear the
economic risk of its investment, has adequate means for providing for its
current needs and has no need for liquidity with respect to its investment in
Verso;

                  (ii)     O'Reilly is an "accredited investor" (as that term is
defined in Rule 501(a) of Regulation D under the 1933 Act (17 C.F.R.
230.501(a));

                  (iii)    O'Reilly has had access to Verso's files and records
(collectively, the "Documents"), understands and has evaluated the risks of a
purchase of the Shares, and has relied solely on the information contained in
the Documents;

                  (iv)     O'Reilly has been provided an opportunity to obtain
additional information concerning Verso and has been given the opportunity to
ask questions of and receive answers from Verso concerning the items and
conditions of this investment, and has been given the opportunity to obtain such
additional information necessary to verify the accuracy of the information
contained in the Documents or that which was otherwise provided in order for
such Claimant to evaluate the merits and risks of purchase of the Shares, and
has not been furnished any other offering literature or prospectus except as
mentioned herein;

                  (v)      O'Reilly has not relied on any oral representation or
oral information in connection with the offering of the Shares which is not
contained in this Agreement or in the Documents; and

                  (vi)     O'Reilly has determined that the Shares are a
suitable investment and that such Claimant could bear a complete loss of its
investment; and

                  (vii)    O'Reilly (A) will not sell or otherwise transfer the
Shares unless registered under the 1933 Act or in reliance upon an exemption
therefrom, and fully understands and agrees that it must bear the economic risk
of its purchase for an indefinite period of time because, among other reasons,
the Shares or underlying securities have not been registered under the 1933 Act
or under the securities laws of certain states and, therefore, cannot be resold,
pledged, assigned or otherwise disposed of other than pursuant to an exception
from registration under the 1933 Act and any other applicable securities laws;
and (B) acknowledges that a legend

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indicating that the Shares have not been registered under such laws and
referring to the restrictions on transferability and sale of the Shares may be
placed on the certificate or certificates delivered to the undersigned or any
substitute certificate therefor, and any transfer agent of Verso may be
instructed to require compliance therewith.

         SECTION  5. MUTUAL RELEASE.

                  (a)      Each Claimant, for itself or himself, as the case may
be, and on behalf of its or his agents, representatives, successors, heirs and
assigns, hereby releases, waives, acquits, withdraws, retracts, and forever
discharges any and all claims, manner of actions, causes of action, in law or in
equity, suits, judgments, debts, liens, contracts, agreements, promises,
liabilities, demands, damages, losses, costs, expenses or disputes, known or
unknown, fixed or contingent, which he now has or may hereafter have, directly
or indirectly, personally or in any capacity, against Verso and all and any of
its present or former affiliates, parents, subsidiaries, predecessors,
successors and assigns, as well as its present or former owners, shareholders,
investors, lenders, agents, independent contractors, directors, officers,
partners, employees, associates, representatives, consultants, attorneys and
insurers, whatsoever, from the beginning of time to, and including, the date of
this Agreement, including, without limitation, in any way relating to or arising
out of the that certain consulting agreement (as amended) which is the subject
of the Proceeding (the "Old Consulting Agreement"); provided, however, that
nothing herein shall release Verso from its obligations under (i) this
Agreement; (ii) the O'Reilly Consulting Agreement; (iii) Section 9(a) of the Old
Consulting Agreement; or (iv) provided that the aggregate Award is greater than
$125,000, those certain stock options (including, without limitation, any stock
option agreement relating thereto) described on Exhibit B hereto (collectively,
the "Options") granted by Verso to O'Reilly.

                  (b)      Verso, for itself and on behalf of its agents,
representatives, successors and assigns, hereby releases, waives, acquits,
withdraws, retracts, and forever discharges any and all claims, manner of
actions, causes of action, in law or in equity, suits, judgments, debts, liens,
contracts, agreements, promises, liabilities, demands, damages, losses, costs,
expenses or disputes, known or unknown, fixed or contingent, which he now has or
may hereafter have, directly or indirectly, in any capacity, against any of the
Claimants and all and any of their respective present or former affiliates,
parents, subsidiaries, predecessors, successors and assigns, as well as their
present or former owners, shareholders, investors, lenders, agents, independent
contractors, directors, officers, partners, employees, associates,
representatives, consultants, attorneys and insurers, whatsoever, from the
beginning of time to, and including, the date of this Agreement, including,
without limitation, in any way relating to or arising out of the Old Consulting
Agreements; provided, however, that nothing herein shall release the Claimants
from their respective obligations under (i) this Agreement; (ii) the Consulting
Agreements; or (iii) provided that the aggregate Award is greater than $125,000,
the Options.

         SECTION 6. OPTIONS. If the aggregate Award is greater than $125,000,
then the Options shall remain in effect and O'Reilly shall be entitled to
exercise his rights thereunder in accordance with the terms thereof; it being
understood and agreed that, unless the applicable Option provides an earlier
termination date, O'Reilly's right to exercise the Options shall terminate 90
days following the termination or expiration of the O'Reilly Consulting
Agreement.

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If the aggregate Award is less than or equal to $125,000, then the
Options shall be terminated without any further action and shall be of no force
or effect whatsoever.

         SECTION  7. PIGGYBACK RIGHTS AND RELATED MATTERS.

                  (a)      Verso agrees to register for resale, at its expense,
the shares of Common Stock issued to O'Reilly pursuant to this Agreement and to
be issued pursuant to the O'Reilly Consulting Agreement (collectively, the
"Shares")), upon the filing of a registration statement under the 1933 Act for
Verso's next registered primary public offering, other than a registration
relating solely to employee benefit plans, a registration relating solely to a
Rule 145 (as promulgated by the Securities and Exchange Commission under the
1933 Act) transaction, or a registration on any registration form that does not
permit secondary sales, subject to customary underwriter cut-backs and the
registration rights of other holders of shares of Common Stock.

                  (b)      Verso shall promptly cause unlegended certificates
for the Shares to be issued and delivered to O'Reilly upon receipt of an opinion
of counsel (which may be counsel to Verso), which opinion shall be in form and
substance reasonably satisfactory to Verso, to the effect that the shares
represented by such certificates may be lawfully disposed of in compliance with
the 1933 Act without registration, qualification or legend. In addition, Verso
shall use its reasonable best efforts to facilitate any sale by O'Reilly of
shares of Common Stock held by him in accordance with Rule 144 under the 1933
Act, including issuing or causing to be issued any necessary instructions to the
transfer agent for the Common Stock. In the event that a legal opinion is
required for any of the foregoing, Verso shall arrange for its counsel to
provide that legal opinion, as long as O'Reilly provides all appropriate
documentation requested by counsel.

         SECTION  8. MISCELLANEOUS.

                  (a)      All notices and other communications required or
permitted under this Agreement shall be in writing and shall be deemed given
when delivered personally, mailed by certified mail (postage pre-paid and return
receipt requested), sent by overnight courier service or faxed (transmission
confirmed), or otherwise actually received. All such notices and other
communications shall be delivered, mailed, couriered or faxed (in each case,
together with an e-mail notification to the e-mail addresses set forth herein
(or otherwise designated in writing to the other party) of the sending of such
notice or communication), (i) if to a Claimant, at the address or facsimile
number set forth on the signature pages hereof, and (ii) if to Verso, at 400
Galleria Parkway, Suite 300, Atlanta, Georgia 30339 (Facsimile No.:
678-589-3750), Attention: Juliet M. Reising (e-mail: Juliet.reising @verso.com),
or at such other address or facsimile number as such Claimant or Verso may
designate in writing to the other party.

                  (b)      This Agreement shall be governed and construed in
accordance with the laws of the State of Michigan (without giving effect to
choice of law principles thereof). Each of the parties hereto irrevocably agrees
that any controversy or claim arising out of or relating to this Agreement, or
the breach thereof, shall be settled by arbitration in Southfield, Michigan in
accordance with the commercial arbitration rules of the American Arbitration
Association then in effect. If the arbitrator in the Proceeding is available and
willing to serve as arbitrator with respect to any such controversy or claim,
then he shall be the arbitrator for any such controversy or claim. If the
arbitrator in the Proceeding is unavailable or unwilling to so serve, then a
single

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arbitrator shall be selected in accordance with the commercial arbitration rules
of the American Arbitration Association. The decision of the arbitrator shall be
final and binding as to any matter submitted to him under this Agreement, and
judgment on any award rendered by the arbitrator may be entered in any court
having jurisdiction thereof.

                  (c)      This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument, and delivered by
facsimile.

                  (d)      This Agreement may be amended only by a written
instrument signed by the Claimants and Verso. No failure to exercise and no
delay in exercising, on the part of any party, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.

                  (e)      All rights, covenants and agreements of the parties
contained in this Agreement shall be binding upon and inure to the benefit of
their respective successors and assigns (including, without limitation, any
trustees or liquidators). This Agreement, and the rights and obligations
hereunder, may not be assigned by any party without the prior written consent of
the other parties.

                  (f)      The Claimants, on the one hand, and Verso, on the
other hand, will each bear their respective legal and other fees and expenses in
connection with the transactions contemplated hereby.

                  (g)      Each party hereto agrees to do all acts and to make,
execute and deliver such written instruments as shall from time to time be
reasonably necessary to carry out the terms and provisions of this Agreement.

                  (h)      This Agreement and the other Transaction Documents
constitute the entire agreement among the parties hereto with respect to the
subject matter hereof and supersede and preempt any prior written or oral
agreements between the parties hereto which may have related to the subject
matter hereof in any way.

                         [SIGNATURES ON FOLLOWING PAGE]

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         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.

                                  VERSO TECHNOLOGIES, INC.

                                  By: /s/ Juliet M. Reising
                                      ----------------------------

                                  Its:Executive Vice President and
                                      ----------------------------
                                      Chief Financial Officer
                                      ----------------------------

                                  /s/ William P. O'Reilly
                                  --------------------------------
                                  WILLIAM P. O'REILLY

                                  MONTANA CORPORATION

                                  By:/s/ William P. O'Reilly
                                  --------------------------------
                                  Its: President
                                  --------------------------------

                                  ADDRESS FOR NOTICE FOR O'REILLY AND O'REILLY
                                  CONSULTING FIRM:

                                  280 N. Old Woodward
                                  Suite 211
                                  Birmingham, Michigan  48009
                                  Fax: (248) 927-0350
                                  E-mail:  oreilly55@hotmail.com<PAGE>
                                                                   EXHIBIT 10.74

                              CONSULTING AGREEMENT

         THIS CONSULTING AGREEMENT (the "Agreement") is made and entered into as
of the 14th day of March, 2003, by and between, WILLIAM P. O'REILLY, an
individual resident of the State of Michigan ("Consultant"), and VERSO
TECHNOLOGIES, INC., a Minnesota corporation (the "Company").

                              W I T N E S S E T H:

         WHEREAS, the Company wishes to engage Consultant to provide to the
Company certain consulting services, as more particularly described herein, and
Consultant desires to render such consulting services to the Company, on the
terms and conditions set forth herein;

         NOW, THEREFORE, in consideration of the premises and of the promises
and agreements hereinafter set forth, the parties hereto, intending to be
legally bound, do hereby agree as follows:

         SECTION  1. DUTIES. Consultant hereby agrees, during the Term (as
hereinafter defined), to provide up to twenty (20) hours of consulting services
per calendar month to the Company on such matters pertaining to the Company's
business as may, from time to time, be reasonably requested of Consultant by the
Company; provided, however, that such services shall be limited to
executive-level services comparable in scope to those previously performed by
Consultant for or on behalf of the Company. In this regard, Consultant shall be
available throughout the Term at reasonable times, and upon reasonable notice,
to meet, in person or via telephone, with the Company, for the purposes of
providing such consulting services; provided, however, that (i) the foregoing
shall not be deemed to restrict Consultant from engaging in any part or
full-time employment with, or providing consulting services to, someone other
than the Company; and (ii) if Consultant is required to meet any place other
than his residence, then he shall be entitled to be reimbursed for his
reasonable travel expenses in accordance with Section 4.3 below, and in no event
shall Consultant be required to travel more than two (2) days per calendar
month. At the Company's request, Consultant may, but shall not be obligated to,
consult for more than twenty (20) hours per calendar month, in which event
Consultant shall receive no additional compensation for such additional
consulting services, but such additional consulting time shall be credited to
(and shall thereupon satisfy the portion of) the 20-hour requirement on an
hour-for-hour basis for the next succeeding calendar month or months (as
necessary to give full credit for such additional consulting time).

         SECTION  2. TERM. The term of this Agreement shall commence on the date
hereof and continue until September 14, 2005 (the "Term").

<PAGE>

         SECTION  3. TERMINATION. This Agreement may be terminated prior to the
expiration of the Term upon the occurrence of any of the following events:

                  (a)      the mutual written agreement of the parties hereto to
                           terminate this Agreement; or

                  (b)      the Company's termination of Consultant hereunder,
                           upon written notice to Consultant, for "good cause,"
                           which shall exist (i) if Consultant fails to cure any
                           material breach of Consultant's duties or obligations
                           under this Agreement within thirty (30) days after
                           written notice of the same from the Company; (ii) if
                           Consultant is convicted of (from which no appeal may
                           be taken), or pleads guilty to, any act of fraud,
                           misappropriation or embezzlement; or (iii) if, in the
                           good faith determination of the Board of Directors of
                           the Company, Consultant has engaged in conduct or
                           activities materially and demonstrably damaging to
                           the business of the Company (it being understood that
                           neither conduct nor activities pursuant to
                           Consultant's exercise of his good faith business
                           judgment nor unintentional physical damage to
                           property by Consultant shall be grounds for such a
                           determination by the Board of Directors of the
                           Company); provided, however, that this Agreement
                           shall not be terminated pursuant to this Section
                           3(b)(iii) unless and until there shall have been
                           delivered to Consultant a copy of the resolution duly
                           adopted by the affirmative vote of not less than a
                           majority of the entire membership of the Company's
                           Board of Directors at a meeting called and held for
                           such purpose (after reasonable notice is provided to
                           Consultant and Consultant is given an opportunity,
                           together with counsel, to be heard before such Board
                           of Directors), finding that, in the good faith
                           determination of such Board of Directors, Consultant
                           has engaged in such conduct or activities, and
                           specifying such conduct or activities in reasonable
                           detail.

                SECTION 4. COMPENSATION AND RELATED MATTERS.

                           4.1      COMPENSATION. In consideration for the
consulting services hereunder, the Company shall deliver to Consultant a number
of shares of the Company's common stock ("Common Stock") on the dates and in the
amounts determined as follows (collectively, the "Shares"):

                  A.       On January 21, 2004: a number of Shares equal to
                           $69,236 divided by the Average Price (as hereafter
                           defined);

                  B.       On January 21, 2005: a number of Shares equal to
                           $69,236 divided by the Average Price; and

                  C.       On January 21, 2006: a number of Shares equal to
                           $34,618 divided by the Average Price.

                                      -2-
<PAGE>
"Average Price" for each of the dates specified above shall mean the arithmetic
average of the daily closing price per share of Common Stock as reported on The
Nasdaq Stock Market ("Nasdaq") for each of the twenty (20) trading days prior to
(and not including) the date specified. Notwithstanding the foregoing, in the
Company's sole discretion, the Company may pay any portion of the consideration
set above in cash (rather than in the form of shares of Common Stock) in an
amount equal to the number of shares times the Average Price, times 85% (e.g.,
if 50% of the first payment under this Agreement is to be paid in the form of
cash and 50% is to be paid in the form of shares of Common Stock, then the cash
portion of such total payment would be equal to 0.85 multiplied by 0.50
multiplied by $69,236 (or expressed mathematically, cash portion = .85 x (.50 x
$69,236)).

                  4.2      NO BENEFITS. Consultant shall not be entitled to
participate in, or receive any benefits under, any welfare benefit plan or
program (including, without limitation, medical, dental, disability, group life
and business travel insurance plans and programs), any retirement savings plan
or program (including, without limitation, 401(k) and pension plans) or any
other fringe benefit program of the Company currently in effect or as the
Company may, from time to time, hereafter adopt and implement for the benefit of
the Company's employees. The foregoing shall not affect the continuing effect of
existing options previously granted by the Company to Consultant.

                  4.3      OUT-OF-POCKET EXPENSES. Consultant shall be entitled
to receive reimbursement for all reasonable expenses incurred in connection with
the fulfillment of Consultant's duties hereunder upon presentation of
appropriate vouchers therefor, provided that Consultant has complied with all
policies and procedures relating to the reimbursement of such expenses as shall,
from time to time, be reasonably established by the Company and consistently
applied.

         SECTION  5. MISCELLANEOUS.

                  5.1      BINDING EFFECT. This Agreement shall inure to the
benefit of and shall be binding upon Consultant, Consultant's executor,
administrator, heirs, personal representatives and assigns, and the Company and
its successors and assigns; provided, however, that the obligations and duties
of Consultant may not be assigned or delegated.

                  5.2      GOVERNING LAW. This Agreement shall be deemed to be
made in, and in all respects shall be interpreted, construed and governed by and
in accordance with, the laws of the State of Michigan, without giving effect to
any conflicts of laws principles.

                  5.3      INVALID PROVISIONS. The parties herein hereby agree
that the agreements, provisions and covenants contained in this Agreement are
severable and divisible, that none of such agreements, provisions or covenants
depends upon any other provision, agreement or covenant for its enforceability,
and that each such agreement, provision and covenant constitutes an enforceable
obligation between the Company and Consultant. Consequently, the parties hereto
agree that neither the invalidity nor the unenforceability of any agreement,
provision or covenant of this Agreement shall affect the other agreements,
provisions

                                      -3-
<PAGE>
or covenants hereof, and this Agreement shall remain in full force and effect
and be construed in all respects as if such invalid or unenforceable agreement,
provision or covenant were omitted.

                  5.4      HEADINGS. The section and paragraph headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.

                  5.5      NOTICES. All communications provided for hereunder
shall be in writing and shall be deemed to be given when delivered in person or
deposited in the United States mail, first class, registered mail, return
receipt requested, with proper postage prepaid, and

                           If to Consultant, addressed to:

                                    William P. O'Reilly
                                    280 N. Old Woodward
                                    Suite 211
                                    Birmingham, Michigan  48009

                           If to the Company, addressed to:

                                    Verso Technologies, Inc.
                                    400 Galleria Parkway
                                    Suite 300
                                    Atlanta, Georgia  30339
                                    Attn.:  Juliet M. Reising

or at such other place or places or to such other person or persons as shall be
designated in writing by the parties hereto in the manner provided above for
notices.

                  5.6      COUNTERPARTS. This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.

                  5.7      WAIVER OF BREACH. No act, event or circumstance shall
be a breach of this Agreement by Consultant (or a reason for termination under
Section 3(b)(iii) hereof) unless the Company shall have given Consultant written
notice of such act, event or circumstance specifying in reasonable detail the
breach occasioned thereby (a "Breach Event") and Consult fails to cure or
discontinue such Breach Event within thirty (30) days of the date of such
notice; provided, however, that the Company shall not be obligated to give any
such notice to Consultant with respect to, and Consultant shall have no right to
cure or discontinue, any Breach Event that is the same or substantially the same
as any Breach Event as to which the Company has previously given notice to
Consultant. The waiver by the Company of a breach of any provision, agreement or
covenant of this Agreement by Consultant shall not operate or be construed as a
waiver of any prior or subsequent breach of the same or any other provision,
agreement or covenant by Consultant.

                                      -4-
<PAGE>

                  5.8      AMENDMENT. This Agreement may not be amended,
modified or supplemented except by written agreement of the parties hereto.

                  5.9      ARBITRATION. Any controversy or claim arising out of
or relating to this Agreement, or the breach thereof, shall be settled by
arbitration in Southfield, Michigan in accordance with the commercial
arbitration rules of the American Arbitration Association then in effect. If the
arbitrator in that certain arbitration proceeding before the American
Arbitration Proceeding (Case No. 54-199-002862) to which Consultant and the
Company, among others, are parties (the "Proceeding") is available and willing
to serve as arbitrator with respect to any such controversy or claim, then he
shall be the arbitrator for any such controversy or claim. If the arbitrator in
the Proceeding is unavailable or unwilling to so serve, then a single arbitrator
shall be selected in accordance with the commercial arbitration rules of the
American Arbitration Association. The decision of the arbitrator shall be final
and binding as to any matter submitted to him under this Agreement, and judgment
on any award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. If the dispute involves the failure of the Company to
issue to Consultant the Shares, then, provided that Consultant prevails in the
arbitration proceeding, (i) the Company shall pay all arbitration fees and all
of Consultant's reasonable costs and attorneys fees associated with the
arbitration of such dispute, and (ii) the measure of damages shall be the
highest closing price of the Shares as reported on Nasdaq during the period
commencing on the date that Shares were scheduled to be issued to Consultant
pursuant to Section 4.1 hereof and the date of the arbitration hearing relating
to such dispute, unless the Company issues to Consultant on or prior to the one
(1) year anniversary of the respective date set forth in Section 4.1 hereof the
number of Shares required to be so issued in accordance with such section and
such Shares have been the registered under the Securities Act of 1933, as
amended, in which event the agreement regarding the measure of damages set forth
in the foregoing clause (ii) shall not apply.

                  5.10     ENTIRE AGREEMENT. This Agreement constitutes the full
and entire understanding and agreement between the parties with regard to the
subject matter hereof.

                  5.11     NON-DISCLOSURE OF CONFIDENTIAL INFORMATION AND TRADE
                           SECRETS.

                           (A)      CONFIDENTIAL INFORMATION; TRADE SECRETS. As
used in this Agreement, the term "Confidential Information" shall mean valuable,
non-public, competitively sensitive data and information relating to the
Company's business or the business of any entity affiliated with the Company,
other than (i) Trade Secrets (as defined below); (ii) information contained in
any publicly available press release, a regulatory filing or other public
communication which is otherwise in the public domain on the date of this
Agreement; (iii) information that hereafter enters the public domain through no
action on the part of Consultant; (iv) information that is known by Consultant
or becomes available to him from a source other than the Company or any of its
affiliates, provided that such information was not obtained as a result of a
breach of any confidentiality obligation by the source of such information; (v)
information that was already in the possession of Consultant prior to the date
hereof and which was not acquired from the Company or any of its affiliates; or
(vi) information obtained from discovery in a legal proceeding, but only to the
extent such information is used in such a proceeding. "Confidential Information"
shall include, among other things, information

                                      -5-
<PAGE>
specifically designated as a Trade Secret that is, notwithstanding the
designation, determined by a court of competent jurisdiction not to be a "trade
secret" under applicable law. As used in this Agreement, the term "Trade
Secrets" shall mean information or data of or about the Company or any entity
affiliated with the Company, including, without limitation, technical or
non-technical data, formulas, patterns, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans,
product plans or lists of actual or potential customers or suppliers, that (i)
derive economic value, actual or potential, from not being generally known to,
and not being readily ascertainable by proper means by, other persons who can
obtain economic value from their disclosure or use; and (ii) are subject of
efforts that are reasonable under the circumstances to maintain their secrecy.
To the extent that the foregoing definition is inconsistent with a definition of
"trade secret" under applicable law, the foregoing definition shall be deemed
amended to the extent necessary to render it consistent with applicable law.

                           (B)      NON-DISCLOSURE. Consultant will be exposed
to Trade Secrets and Confidential Information as a result of the relationship
with the Company as provided in this Agreement. Consultant acknowledges and
agrees that any unauthorized disclosure or use of any of the Trade Secrets or
Confidential Information of the Company would be wrongful and would likely
result in immediate and irreparable injury to the Company. In consideration of
the terms of this Agreement, except as appropriate in connection with the
performance of Consultant's duties and obligations under this Agreement,
Consultant shall not, without the express prior written consent of an executive
officer of the Company, redistribute, market, publish, disclose or divulge to
any other person or entity, or use or modify for use, directly or indirectly, in
any way for any person or entity (i) any Confidential Information during the
Term of this Agreement and for a period of two (2) years after the date of the
termination of this Agreement; and (ii) any Trade Secrets at any time (during or
after the Term of this Agreement) during which such information or data shall
continue to constitute a "trade secret" under applicable law. Consultant agrees
to cooperate with any reasonable confidentiality requirements of the Company.
Consultant shall immediately notify the Company of any disclosure or use of any
Trade Secrets or Confidential Information by Consultant in violation of the
terms hereof of which Consultant becomes aware.

                            [Signature page follows.]

                                      -6-
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first written above.

                                    /s/ William P. O'Reilly
                                    -------------------------------------
                                    WILLIAM P. O'REILLY

                                    VERSO TECHNOLOGIES, INC.

                                    By: /s/ Juliet M. Reising
                                       -------------------------------------
                                    Its: Executive Vice President and
                                        ------------------------------------
                                         Chief Financial Officer
                                        ------------------------------------

                                      -7-

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