ENERPAC TOOL GROUP CORP — M&A Activity 1997

Sep 5, 1997

1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 5, 1997. ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ SCHEDULE 14D-1 TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 ------------------------ VERSA TECHNOLOGIES, INC. (NAME OF SUBJECT COMPANY) ------------------------ APPLIED POWER INC. TVPA CORP. (BIDDERS) ------------------------ COMMON STOCK, PAR VALUE $.01 PER SHARE (TITLE OF CLASS OF SECURITIES) 925116-10-5 (CUSIP NUMBER OF CLASS OF SECURITIES) ------------------------ ROBERT C. ARZBAECHER APPLIED POWER INC. 13000 WEST SILVER SPRING DRIVE BUTLER, WI 53007 (414) 781-6600 (414) 781-0629 (FAX) (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF BIDDERS) ------------------------ Copy to: ANTHONY W. ASMUTH III, ESQ. QUARLES & BRADY 411 EAST WISCONSIN AVENUE MILWAUKEE, WISCONSIN 53202 (414) 277-5000 (414) 271-3552 (FAX) CALCULATION OF FILING FEE

• For purposes of calculating fee only. This amount assumes the purchase of 5,974,824 shares of Common Stock, par value $.01 per share, of the Subject Company, on a fully diluted basis (consisting of 5,596,083 shares currently outstanding plus an additional 378,741 shares issuable upon exercise of options) at $24.625 in cash per share. The amount of the filing fee, calculated in accordance with Regulation 240.0-11 of the Securities Exchange Act of 1934, equals 1/50 of one percentum of the value of the shares to be purchased. [ ] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. AMOUNT PREVIOUSLY PAID: NOT APPLICABLE FILING PARTY: FORM OF REGISTRATION NO.: DATE FILED: ================================================================================ 2 CUSIP NO. 925116-10-5 SCHEDULE 14D-1 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) TVPA Corp. 39-1904753 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] 3 SEC USE ONLY 4 SOURCES OF FUNDS AF (from Parent) 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(E) OR 2(F) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware 7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON -0- 8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES [ ] 9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7) 0% 10 TYPE OF REPORTING PERSON CO 2 3 CUSIP NO. 925116-10-5 SCHEDULE 14D-1 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Applied Power Inc. 39-0168610 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [X] 3 SEC USE ONLY 4 SOURCES OF FUNDS BK, WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(E) OR 2(F) [ ] 6 CITIZENSHIP OR PLACE OF ORGANIZATION Wisconsin 7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON -0- 8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES [X] 9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7) 0% 10 TYPE OF REPORTING PERSON CO 3 4 ITEM 1. SECURITY AND SUBJECT COMPANY (a) The name of the subject company is Versa Technologies, Inc., a Delaware corporation (the "Company"). The address of the principal executive offices of the Company is set forth in Section 7 ("Certain Information Concerning the Company") of the Offer to Purchase, dated September 5, 1997 (the "Offer to Purchase"), a copy of which is filed as Exhibit (a)(1) hereto. (b) This Statement relates to a tender offer by TVPA Corp., a Delaware corporation (the "Purchaser") and a wholly-owned subsidiary of Applied Power Inc., a Wisconsin corporation ("Parent"), to purchase all outstanding shares of common stock, par value $.01 per share (the "Common Stock"), including the associated rights to purchase Series A Junior Participating Preferred Stock (together with the Common Stock, the "Shares"), of the Company, at a purchase price of $24.625 per Share, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase and in the related Letter of Transmittal, a copy of which is filed as Exhibit (a)(2) hereto. The Offer to Purchase and Letter of Transmittal (which, together with any supplements or amendments, collectively constitute the "Offer") are incorporated herein by reference. The information set forth in the Introduction of the Offer to Purchase is incorporated herein by reference. (c) The information set forth in Section 6 ("Price Range of Shares; Dividends") of the Offer to Purchase is incorporated herein by reference. ITEM 2. IDENTITY AND BACKGROUND (a)-(g) The information set forth in the Introduction, Section 8 ("Certain Information Concerning Parent and the Purchaser") and Schedule I of the Offer to Purchase is incorporated herein by reference. During the past five years, neither the Purchaser, Parent, nor any of the persons listed in Schedule I of the Offer to Purchase has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction, and, as a result of such proceeding, was or is subject to a judgment, decree or final order enjoining further violation of, or prohibiting activities subject to, federal or state securities laws or finding any violation of such laws. ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY (a)-(b) The information set forth in the Introduction, Section 7 ("Certain Information Concerning the Company"), Section 8 ("Certain Information Concerning Parent and the Purchaser"), Section 10 ("Background of the Offer; Contacts with the Company; the Merger Agreement") and Section 11 ("Purpose of the Offer; Plans for the Company After the Offer and the Merger") of the Offer to Purchase is incorporated herein by reference. ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION (a)-(b) The information set forth in the Introduction and Section 9 ("Financing of the Offer and the Merger") of the Offer to Purchase is incorporated herein by reference. (c) Not applicable. ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER Introductory Paragraph; (a)-(e) The information set forth in the Introduction, Section 10 ("Background of the Offer; Contacts with the Company; the Merger Agreement") and Section 11 ("Purpose of the Offer; Plans for the Company After the Offer and the Merger") of the Offer to Purchase is incorporated herein by reference. (f)-(g) The information set forth in Section 13 ("Effect of the Offer on the Market for the Shares; Nasdaq Listing and Exchange Act Registration") of the Offer to Purchase is incorporated herein by reference. 4 5 ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY (a) The information contained in Items 7, 8 and 9 of the cover pages hereto is incorporated herein by reference. The information set forth in the Introduction, Section 8 ("Certain Information Concerning Parent and the Purchaser") and Schedule II of the Offer to Purchase is incorporated herein by reference. (b) The information contained in Section 10 ("Background of the Offer; Contacts with the Company; The Merger Agreement"), Section 11 ("Purpose of the Offer; Plans for the Company After the Offer and the Merger") and Schedule II of the Offer to Purchase is incorporated herein by reference. ITEM 7.CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE SUBJECT COMPANY'S SECURITIES The information set forth in the Introduction, Section 9 ("Financing of the Offer and the Merger"), Section 10 ("Background of the Offer; Contacts with the Company; The Merger Agreement") and Section 16 ("Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED The information set forth in the Introduction and Section 16 ("Fees and Expenses") of the Offer to Purchase is incorporated herein by reference. ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS The information set forth in Section 8 ("Certain Information Concerning Parent and the Purchaser") of the Offer to Purchase is incorporated herein by reference. The incorporation by reference herein of the above-referenced financial information does not constitute an admission that such information is material to a decision by a holder of Common Stock of the Company whether to sell, tender or hold securities being sought in the Offer. ITEM 10. ADDITIONAL INFORMATION (a) Not applicable. (b)-(c) The information set forth in Section 15 ("Certain Regulatory and Legal Matters") of the Offer to Purchase is incorporated herein by reference. (d) The information set forth in Section 9 ("Financing of the Offer and the Merger"), Section 13 ("Effect of the Offer on the Market for the Shares; Nasdaq Listing and Exchange Act Registration") and Section 15 ("Certain Regulatory and Legal Matters") of the Offer to Purchase is incorporated herein by reference. (e) Not applicable. (f) Reference is hereby made to the Offer to Purchase and the related Letter of Transmittal, copies of which are attached hereto as Exhibits (a)(1) and (a)(2), and are incorporated herein by reference in their entirety. 5 6 ITEM 11. MATERIAL TO BE FILED AS EXHIBITS

6 7 SIGNATURES After due inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: September 5, 1997 TVPA CORP. BY: /s/ ROBERT C. ARZBAECHER ------------------------------------ Robert C. Arzbaecher, Vice President APPLIED POWER INC. BY: /s/ ROBERT C. ARZBAECHER ------------------------------------ Robert C. Arzbaecher, Vice President and Chief Financial Officer S-1 8 EXHIBIT INDEX

EI-1 9 EXHIBIT (a)(1) OFFER TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE SERIES A JUNIOR PARTICIPATING PREFERRED STOCK) OF VERSA TECHNOLOGIES, INC. AT $24.625 NET PER SHARE BY TVPA CORP. A WHOLLY OWNED SUBSIDIARY OF APPLIED POWER INC. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., EASTERN TIME, ON FRIDAY, OCTOBER 3, 1997, UNLESS THE OFFER IS EXTENDED. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE A NUMBER OF SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE, INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK, OF VERSA TECHNOLOGIES, INC. REPRESENTING NOT LESS THAN A MAJORITY OF THE SHARES THEN OUTSTANDING AND ENTITLED TO VOTE, MEASURED ON A FULLY DILUTED BASIS. THE OFFER IS ALSO CONDITIONED UPON CERTAIN OTHER TERMS AND CONDITIONS, INCLUDING THE EXPIRATION OR TERMINATION OF ALL WAITING PERIODS IMPOSED BY THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED, AND THE REGULATIONS THEREUNDER. SEE SECTIONS 14 AND 15. THE OFFER IS NOT CONDITIONED ON THE RECEIPT OF FINANCING. ------------------ THE BOARD OF DIRECTORS OF VERSA TECHNOLOGIES, INC. (THE "COMPANY") HAS UNANIMOUSLY APPROVED THE OFFER AND UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS TENDER THEIR SHARES PURSUANT TO THE OFFER. ------------------ IMPORTANT Any shareholder desiring to tender all or any portion of such shareholder's shares of common stock, par value $.01 per share, of the Company (the "Common Stock"), including the associated rights to purchase Series A Junior Participating Preferred Stock (the "Rights" and, together with the Common Stock, the "Shares"), should either (1) complete and sign the Letter of Transmittal (or a facsimile thereof) in accordance with the instructions in the Letter of Transmittal, including any required signature guarantees, and mail or deliver the Letter of Transmittal (or such facsimile) with the certificate(s) for the tendered Shares and any other required documents to the Depositary, (2) follow the procedures for book-entry tender of Shares set forth in Section 3, or (3) request such shareholder's broker, dealer, commercial bank, trust company or other nominee to effect the transaction for such shareholder. Shareholders having Shares registered in the name of a broker, dealer, commercial bank, trust company or other nominee are urged to contact such broker, dealer, commercial bank, trust company or other nominee if they desire to tender Shares so registered. A shareholder who desires to tender Shares and whose certificates for such Shares are not immediately available, or who cannot comply with the procedures for book-entry transfer on a timely basis, may tender such shares by following the procedures for guaranteed delivery set forth in Section 3. QUESTIONS AND REQUESTS FOR ASSISTANCE MAY BE DIRECTED TO THE INFORMATION AGENT AT ITS ADDRESS AND TELEPHONE NUMBER SET FORTH ON THE BACK COVER OF THIS OFFER TO PURCHASE. ADDITIONAL COPIES OF THIS OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL AND THE NOTICE OF GUARANTEED DELIVERY MAY ALSO BE OBTAINED FROM THE INFORMATION AGENT OR FROM BROKERS, DEALERS, COMMERCIAL BANKS OR TRUST COMPANIES. ------------------ SEPTEMBER 5, 1997 10 TABLE OF CONTENTS

11 To the Holders of Common Stock of Versa Technologies, Inc.: INTRODUCTION TVPA Corp., a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Applied Power Inc., a Wisconsin corporation ("Parent"), hereby offers to purchase all of the outstanding shares of common stock, par value $.01 per share (the "Common Stock"), of Versa Technologies, Inc., a Delaware corporation (the "Company"), including the associated rights to purchase Series A Junior Participating Preferred Stock (the "Rights") issued pursuant to the Rights Agreement dated as of December 13, 1988, as amended (the "Rights Agreement"), between the Company and Firstar Trust Company, as rights agent (the Common Stock and the Rights together are referred to herein as the "Shares") at $24.625 per Share, net to the seller in cash, without interest thereon (the "Offer Price"), upon the terms and subject to the conditions set forth in this Offer to Purchase and in the related Letter of Transmittal (which, as either may be amended or supplemented from time to time, collectively constitute the "Offer"). Tendering shareholders will not be obligated to pay brokerage fees or commissions or, subject to Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase of Shares by the Purchaser. The Purchaser will pay all charges and expenses of ChaseMellon Shareholder Services, L.L.C., which firm is acting as the Depositary (the "Depositary"), and of Georgeson & Company Inc., which firm is acting as the Information Agent (the "Information Agent"), incurred in connection with the Offer. See Section 16 herein. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE A NUMBER OF SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE, INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK, OF VERSA TECHNOLOGIES, INC. REPRESENTING NOT LESS THAN A MAJORITY OF THE SHARES THEN OUTSTANDING AND ENTITLED TO VOTE, MEASURED ON A FULLY DILUTED BASIS (THE "MINIMUM CONDITION"). THE OFFER IS ALSO CONDITIONED UPON CERTAIN OTHER TERMS AND CONDITIONS, INCLUDING THE EXPIRATION OR TERMINATION OF ALL WAITING PERIODS IMPOSED BY THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED, AND THE REGULATIONS THEREUNDER. SEE SECTIONS 14 AND 15. THE OFFER IS NOT CONDITIONED ON THE RECEIPT OF FINANCING. The Offer is being made pursuant to an Agreement and Plan of Merger (the "Merger Agreement"), dated as of September 2, 1997, among the Company, Parent and the Purchaser, pursuant to which, after the completion of the Offer, the Purchaser will be merged with and into the Company and each outstanding Share (except as described below) will be converted into the right to receive $24.625 in cash (the "Merger"). THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT EACH OF THE OFFER AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF, THE SHAREHOLDERS OF THE COMPANY, AND UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS TENDER THEIR SHARES PURSUANT TO THE OFFER. According to the Company, as of September 2, 1997, there were 5,596,083 Shares outstanding and there were 378,741 Shares subject to issuance pursuant to the Company's stock option and incentive plans. According to the Company, there are no other classes of capital stock issued and outstanding as of the date hereof other than the Common Stock. Assuming each Option (as defined in Section 10) is repurchased as described in Section 10, which Parent and the Purchaser anticipate will be the case, then the Minimum Condition would be satisfied by the tender of 2,798,042 Shares, provided none of such Shares is withdrawn in accordance with the procedures set forth in Section 4. If none of the Options is repurchased as described in Section 10, then the Minimum Condition would be satisfied by the tender of 2,987,413 Shares, provided none of such Shares is withdrawn in accordance with the procedures set forth in Section 4. The actual number of Shares that must be tendered and 12 not withdrawn in order for the Minimum Condition to be satisfied will depend upon the facts as they exist on the date of purchase. The purpose of the Offer is to acquire for cash as many outstanding Shares as possible as a first step in acquiring the entire equity interest in the Company. Upon the consummation of the Offer, Parent intends to consummate, as soon as possible after completion of the Offer, the Merger pursuant to and in accordance with the terms set forth in the Merger Agreement. The Merger Agreement provides that, among other things, as soon as practicable after the purchase of Shares pursuant to the Offer and the satisfaction of the other conditions set forth in the Merger Agreement and in accordance with the relevant provisions of the Delaware General Corporation Law ("DGCL"), the Purchaser will be merged with and into the Company. Following consummation of the Merger, the Company will continue as the surviving corporation (the "Surviving Corporation") and will become a wholly owned subsidiary of Parent. At the effective time of the Merger (the "Effective Time"), each Share issued and outstanding immediately prior to the Effective Time (other than Shares held in the treasury of the Company or owned by the Purchaser, Parent or any direct or indirect wholly owned subsidiary of Parent or the Company, and other than Shares held by shareholders who shall have demanded and perfected appraisal rights, if any, under the DGCL) will be canceled and converted automatically into the right to receive $24.625 in cash, without interest (the "Merger Consideration"). See Sections 10 and 11. THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION AND SHOULD BE READ IN THEIR ENTIRETY BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER. 1. TERMS OF THE OFFER; EXPIRATION DATE. Upon the terms and subject to the conditions set forth in the Offer (including, if the Offer is extended or amended, the terms and conditions of such extension or amendment), the Purchaser will accept for payment, and pay for, all Shares validly tendered on or prior to the Expiration Date and not withdrawn as permitted by Section 2. The term "Expiration Date" means 5:00 p.m., Eastern time, on Friday, October 3, 1997, unless and until the Purchaser, in its sole discretion, shall have extended the period of time during which the Offer is open, in which event the term "Expiration Date" shall mean the latest time and date at which the Offer, as so extended by the Purchaser, will expire. In all cases, payment for Shares tendered and purchased pursuant to the Offer will be made only after timely receipt by the Depositary of, among other things, certificates representing Rights ("Rights Certificates"), if such Rights Certificates have been distributed to shareholders. See Sections 3 and 7. Any reference in this Offer to Purchase to Shares shall be deemed to include, when appropriate in the context, a reference to such Rights Certificates following any distribution thereof. The Purchaser expressly reserves the right, in its sole discretion but subject to the provisions of the Merger Agreement, at any time or from time to time, to extend the period of time during which the Offer is open by giving oral or written notice of such extension to the Depositary. See Section 10. Any such extension will also be publicly announced by press release issued no later than 9:00 a.m., Eastern time, on the next business day after the previously scheduled Expiration Date. During any such extension, all Shares previously tendered and not withdrawn will remain subject to the Offer, subject to the right of a tendering shareholder to withdraw his Shares. See Section 4. Subject to the applicable regulations of the Securities and Exchange Commission (the "Commission"), the Purchaser also expressly reserves the right, in its sole discretion but subject to the provisions of the Merger Agreement, at any time or from time to time, (i) to delay acceptance for payment of or, regardless of whether such Shares were theretofore accepted for payment, payment for any Shares or to terminate the Offer and not accept for payment or pay for any Shares not theretofore accepted for payment, or paid for, upon the occurrence of any of the conditions specified in Section 14 and (ii) to waive any condition or otherwise amend the Offer in any respect, by giving oral or written notice of such delay, termination, waiver or amendment to the Depositary and by making a public announcement thereof. See Section 10. If the Purchaser accepts any Shares for payment pursuant to the terms of the Offer, it will accept for payment all Shares validly tendered prior to the Expiration Date and not withdrawn, and, subject to (i) above, will promptly pay for all Shares so accepted for payment. The Purchaser confirms that its reservation of the right to delay payment for Shares which it has accepted for payment is limited by 2 13 Rule 14e-1(c) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which requires that a tender offeror pay the consideration offered or return the tendered securities promptly after the termination or withdrawal of a tender offer. Any extension, delay, termination or amendment of the Offer will be followed as promptly as practicable by public announcement thereof, such announcement in the case of an extension to be issued no later than 9:00 a.m., Eastern time, on the next business day after the previously scheduled Expiration Date. Subject to applicable law (including Rules 14d-4(c) and 14d-6(d) under the Exchange Act, which require that any material change in the information published, sent or given to shareholders in connection with the Offer be promptly disseminated to shareholders in a manner reasonably designed to inform shareholders of such change) and without limiting the manner in which the Purchaser may choose to make any public announcement, the Purchaser shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making a release to the Dow Jones News Service and making any appropriate filing with the Commission. The Purchaser confirms that if it makes a material change in the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Purchaser will extend the Offer to the extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act. If, prior to the Expiration Date, the Purchaser, with the Company's consent, shall decrease the percentage of Shares being sought or the consideration offered to holders of Shares, such decrease shall be applicable to all holders whose Shares are accepted for payment pursuant to the Offer and, if at the time notice of any decrease is first published, sent or given to holders of Shares, the Offer is scheduled to expire at any time earlier than the tenth business day from and including the date that such notice is first so published, sent or given, the Offer will be extended until the expiration of such ten business-day period. For purposes of the Offer, a "business day" means any day other than a Saturday, Sunday or federal holiday and consists of the time period from 12:01 a.m. through 12:00 Midnight, Eastern time. The Offer is being mailed to holders of Shares from a list provided to the Purchaser by the Company pursuant to the Merger Agreement. 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. Upon the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), the Purchaser will accept for payment, and will pay for, Shares validly tendered and not withdrawn as promptly as practicable after the later of (i) the expiration or termination of the waiting period applicable to the acquisition of Shares pursuant to the Offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended ("HSR Act"), and (ii) the Expiration Date. Parent expects to file a Notification and Report Form under the HSR Act on or about September 8, 1997, and unless earlier terminated or extended by a request for additional information, the waiting period under the HSR Act would expire at 11:59 p.m., Eastern time, on the fifteenth day following such filing. See Section 15. In addition, subject to applicable rules of the Commission, the Purchaser expressly reserves the right to delay acceptance for payment of or payment for Shares in order to comply, in whole or in part, with any applicable law. See Section 14. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) certificates for such Shares (or a confirmation of a book-entry transfer of such Shares into the Depositary's account at The Depository Trust Company (the "Book-Entry Transfer Facility")), (ii) a properly completed and duly executed Letter of Transmittal (or facsimile thereof) and (iii) any other required documents. For purposes of the Offer, the Purchaser will be deemed to have accepted for payment Shares validly tendered and not withdrawn as, if and when the Purchaser gives oral or written notice to the Depositary of its acceptance for payment of such Shares pursuant to the Offer. Payment for Shares accepted for payment pursuant to the Offer will be made by deposit of the purchase price therefor with the Depositary, which will act as agent for the tendering shareholders for purpose of receiving payments from the Purchaser and transmitting such payments to the tendering shareholders. Under no circumstances will interest on the purchase price for Shares be paid, regardless of any delay in making such payment. 3 14 If any tendered Shares are not accepted for payment pursuant to the terms and conditions of the Offer for any reason, or if certificates are submitted for more Shares than are tendered, certificates for such unpurchased Shares will be returned, without expense to the tendering shareholder (or, in the case of Shares tendered by book-entry transfer of such Shares into the Depositary's account at the Book-Entry Transfer Facility pursuant to the procedures set forth in Section 3, such Shares will be credited to an account maintained with the Book-Entry Transfer Facility), as soon as practicable following expiration or termination of the Offer. The Purchaser reserves the right to transfer or assign in whole or in part from time to time to one or more direct or indirect subsidiaries of Parent the right to purchase all or any portion of the Shares tendered pursuant to the Offer, but any such transfer or assignment will not relieve the Purchaser of its obligations under the Offer and will in no way prejudice the rights of tendering shareholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offer. 3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES. In order for a holder of Shares validly to tender Shares pursuant to the Offer, either (a) a properly completed and duly executed Letter of Transmittal (or a facsimile thereof) in accordance with the instructions of the Letter of Transmittal, with any required signature guarantees, along with certificates for the Shares to be tendered and any other documents required by the Letter of Transmittal, must be received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase prior to the Expiration Date, (b) such Shares must be delivered pursuant to the procedures for book-entry transfer described below (and a confirmation of such delivery received by the Depositary, including an Agent's Message (as defined herein) if the tendering shareholder has not delivered a Letter of Transmittal), prior to the Expiration Date, or (c) the tendering shareholder must comply with the guaranteed delivery procedures set forth below. The term "Agent's Message" means a message, transmitted by the Book-Entry Transfer Facility to, and received by, the Depositary and forming a part of a book-entry confirmation, which states that the Book-Entry Transfer Facility has received an express acknowledgment from the participant in such Book-Entry Transfer Facility tendering the Shares which are the subject of such book-entry confirmation, that such participant has received and agrees to be bound by the terms of the Letter of Transmittal and that the Purchaser may enforce such agreement against the participant. Unless a Distribution Date (as defined in Section 7) occurs, the Rights will be transferred with and only with the certificates for Common Stock and the surrender for transfer of any certificates for Common Stock will also constitute the transfer of the Rights associated with the Shares represented by such certificate. Prior to entering into the Merger Agreement, the Company amended the Rights Agreement so that neither Parent nor the Purchaser will be deemed an Acquiring Person (as defined in Section 7), no Stock Acquisition Date (as defined in Section 7) or Distribution Date will occur or be deemed to occur. Accordingly, the Rights will not become subject to an adjustment or become exercisable or separate from the Shares as a result of entry into the Merger Agreement, commencement or consummation of the Offer or the Merger, or the other transactions contemplated by the Merger Agreement. If the Rights Agreement should otherwise be triggered and separate certificates representing the Rights are issued to holders of Common Stock prior to the time a holder's shares of Common Stock are tendered pursuant to the Offer, certificates representing a number of Rights equal to the number of shares of Common Stock tendered must be delivered to the Depositary, or, if available, a Book-Entry Confirmation (as defined herein) received by the Depositary with respect thereto, in order for such shares of Common Stock to be validly tendered. If a Distribution Date occurs and separate certificates representing the Rights are not distributed prior to the time shares of Common Stock are tendered pursuant to the Offer, Rights may be tendered prior to a shareholder receiving the certificates for Rights by use of the guaranteed delivery procedures described below. A tender of shares of Common Stock constitutes an agreement by the tendering shareholder to deliver certificates representing all Rights formerly associated with the number of shares of Common Stock tendered pursuant to the Offer to the Depositary prior to expiration of the period permitted by such guaranteed delivery procedures for delivery of certificates for, or a Book-Entry Confirmation with respect to, Rights (the "Rights Delivery Period"). However, after expiration of the Rights Delivery Period, the Purchaser may elect to reject as invalid a tender of shares of Common Stock with respect to which certificates for, or a Book-Entry Confirmation with respect to, the number of Rights required to be tendered with such Common Stock have not been received by the Depositary. Nevertheless, the 4 15 Purchaser will be entitled to accept for payment shares of Common Stock tendered by a shareholder prior to receipt of the certificates for the Rights required to be tendered with such shares of Common Stock, or a Book-Entry Confirmation with respect to such Rights, and either (a) subject to complying with applicable rules and regulations of the Commission, withhold payment for such shares of Common Stock pending receipt of the certificates for, or a Book-Entry Confirmation with respect to, such Rights or (b) make payment for shares of Common Stock accepted for payment pending receipt of the certificates for, or a Book-Entry Confirmation with respect to, such Rights in reliance upon the agreement of a tendering shareholder to deliver Rights and such guaranteed delivery procedures. Any determination by the Purchaser to make payment for shares of Common Stock in reliance upon such agreement and such guaranteed delivery procedures or, after expiration of the Rights Delivery Period, to reject a tender as invalid will be made in the sole and absolute discretion of the Purchaser. Book-Entry Delivery. The Depositary will establish accounts with respect to the Shares at the Book-Entry Transfer Facility for purposes of the Offer within two business days after the date of this Offer to Purchase. Any financial institution that is a participant in the Book-Entry Transfer Facility's systems may make a book-entry transfer of Shares by causing the Book-Entry Transfer Facility to transfer such Shares into the Depositary's account in accordance with the Book-Entry Transfer Facility's procedures for such transfer. However, although delivery of Shares may be effected through book-entry transfer, either the Letter of Transmittal (or facsimile thereof), properly completed and duly executed, together with any required signature guarantees, or an Agent's Message in lieu of the Letter of Transmittal, and any other required documents, must, in any case, be transmitted to and received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase by the Expiration Date, or the tendering shareholder must comply with the guaranteed delivery procedures described below. If a Distribution Date occurs, the Depositary will also make a request to establish an account with respect to the Rights at the Book-Entry Transfer Facility, but no assurance can be given that book-entry transfer of Rights will be available. If book-entry transfer of Rights is available, the foregoing book-entry transfer procedures will also apply to Rights. If book-entry transfer of Rights is not available and a Distribution Date has occurred, a tendering shareholder will be required to tender Rights by means of physical delivery to the Depositary of certificates for Rights (in which event references in this Offer to Purchase to Book-Entry Confirmations with respect to Rights will be inapplicable). The confirmation of a book-entry transfer of shares of Common Stock or Rights into the Depositary's account at the Book-Entry Transfer Facility as described above is referred to herein as a "Book-Entry Confirmation." DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH THE BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. SHARES WILL BE DEEMED DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE CASE OF A BOOK-ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL, IT IS RECOMMENDED THAT THE SHAREHOLDER USE PROPERLY INSURED REGISTERED MAIL WITH RETURN RECEIPT REQUESTED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. Signature Guarantees. Except as otherwise provided below, all signatures on a Letter of Transmittal must be guaranteed by a financial institution (including most commercial banks, savings and loan associations and brokerage houses) that is a participant in the Securities Transfer Agents Medallion Program, the New York Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange Medallion Program (an "Eligible Institution"). Signatures on a Letter of Transmittal need not be guaranteed (a) if the Letter of Transmittal is signed by the registered holder (which term, for purposes of this section, includes any participant in the Book-Entry Transfer Facility's systems whose name appears on a security position listing as the owner of the Shares) of Shares and such registered holder has not completed the box entitled "Special Payment Instructions" or the box entitled "Special Delivery Instructions" on the Letter of Transmittal or 5 16 (b) if such Shares are tendered for the account of an Eligible Institution. See Instructions 1 and 5 of the Letter of Transmittal. If the certificates for Shares are registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made or certificates for Shares not tendered or not accepted for payment are to be returned to a person other than the registered holder of the certificates surrendered, then the tendered certificates must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name or names of the registered holders or owners appear on the certificates, with the signatures on the certificates or stock powers guaranteed as described above. See Instructions 1 and 5 of the Letter of Transmittal. Guaranteed Delivery. A shareholder who desires to tender Shares pursuant to the Offer and whose certificates for Shares are not immediately available, or who cannot comply with the procedure for book-entry transfer on a timely basis, or who cannot deliver all required documents to the Depositary prior to the Expiration Date, may tender such Shares by following all of the procedures set forth below: (i) such tender is made by or through an Eligible Institution; (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided by the Purchaser, is received by the Depositary (as provided below) prior to the Expiration Date; and (iii) the certificates for all tendered Shares, in proper form for transfer (or a Book-Entry Confirmation with respect to all such Shares), together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof), with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message in lieu of the Letter of Transmittal), and any other required documents, are received by the Depositary within (a) in the case of shares for Common Stock, three trading days after the date of execution of such Notice of Guaranteed Delivery and (b) in the case of Rights, a period ending on the later of (1) three trading days after the date of execution of such Notice of Guaranteed Delivery or (2) three trading days after the date certificates for Rights are distributed to shareholders by the Rights Agent. A "trading day" is any day on which the New York Stock Exchange is open for business. The Notice of Guaranteed Delivery may be delivered by hand to the Depositary or transmitted by facsimile transmission or mail to the Depositary and must include a guarantee by an Eligible Institution in the form set forth in such Notice of Guaranteed Delivery. Stock Purchase and Dividend Reinvestment Plan. Holders of Shares through the Company's Stock Purchase and Dividend Reinvestment Plan ("DRIP") will need to contact the DRIP administrator, Firstar Trust Company, at 1-800-637-7549 in order to make arrangements to tender Shares held in the DRIP pursuant to the Offer. Other Requirements. Notwithstanding any provision hereof, payment for Shares accepted for payment pursuant to the Offer will in all cases be made only after timely receipt by the Depositary of (a) certificates for (or a timely Book-Entry Confirmation with respect to) such Shares, (b) a Letter of Transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message in lieu of the Letter of Transmittal) and (c) any other documents required by the Letter of Transmittal. Accordingly, tendering shareholders may be paid at different times depending upon when certificates for Shares or Book-Entry Confirmations with respect to Shares are actually received by the Depositary. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE OF THE SHARES BE PAID BY THE PURCHASER, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT. Tender Constitutes An Agreement. The valid tender of Shares pursuant to one of the procedures described above will constitute a binding agreement between the tendering shareholder and the Purchaser upon the terms and subject to the conditions of the Offer. Appointment. By executing a Letter of Transmittal as set forth above, the tendering shareholder irrevocably appoints designees of the Purchaser as such shareholder's proxies, each with full power of 6 17 substitution, to the full extent of such shareholder's rights with respect to the Shares tendered by such shareholder and accepted for payment by the Purchaser and with respect to any and all other Shares or other securities issued or issuable in respect of such Shares on or after September 5, 1997. All such proxies will be considered coupled with an interest in the tendered Shares. Such appointment is effective when, and only to the extent that, the Purchaser deposits the payment for such Shares with the Depositary. Upon the effectiveness of such appointment, all prior powers of attorney, proxies and consents given by such shareholder will be revoked, and no subsequent powers of attorney, proxies and consents may be given (and, if given, will not be deemed effective). The Purchaser's designees will, with respect to the Shares for which the appointment is effective, be empowered to exercise all voting and other rights of such shareholder as they, in their sole discretion, may deem proper at any annual, special or adjourned meeting of the shareholders of the Company, by written consent in lieu of any such meeting or otherwise. The Purchaser reserves the right to require that, in order for Shares to be deemed validly tendered, immediately upon the Purchaser's payment for such Shares, the Purchaser must be able to exercise full voting rights with respect to such Shares. Determination Of Validity. All questions as to the validity, form, eligibility (including time of receipt) and acceptance of any tender of Shares will be determined by the Purchaser in its sole discretion, which determination will be final and binding. The Purchaser reserves the absolute right to reject any and all tenders determined by it not to be in proper form or the acceptance for payment of or payment for which may, in the opinion of the Purchaser's counsel, be unlawful. The Purchaser also reserves the absolute right to waive any defect or irregularity in the tender of any Shares of any particular shareholder whether or not similar defects or irregularities are waived in the case of other shareholders. No tender of Shares will be deemed to have been validly made until all defects and irregularities relating thereto have been cured or waived. None of the Purchaser, the Depositary, the Information Agent, or any other person will be under any duty to give notification of any defects or irregularities in tenders or incur any liability for failure to give any such notification. The Purchaser's interpretation of the terms and conditions of the Offer (including the Letter of Transmittal and Instructions thereto) will be final and binding. Backup Withholding. In order to avoid "backup withholding" of Federal income tax on payments of cash pursuant to the Offer, a shareholder surrendering Shares in the Offer must, unless an exemption applies, provide the Depositary with such shareholder's correct taxpayer identification number ("TIN") on a Substitute Form W-9 and certify under penalties of perjury that such TIN is correct and that such shareholder is not subject to backup withholding. If a shareholder does not provide such shareholder's correct TIN or fails to provide the certifications described above, the Internal Revenue Service (the "IRS") may impose a penalty on such shareholder and payment of cash to such shareholder pursuant to the Offer may be subject to backup withholding of 31%. All shareholders surrendering Shares pursuant to the Offer should complete and sign the main signature form and the Substitute Form W-9 included as part of the Letter of Transmittal to provide the information and certification necessary to avoid backup withholding (unless an applicable exemption exists and is proved in a manner satisfactory to the Purchaser and the Depositary). Certain shareholders (including, among others, corporations and certain foreign individuals and entities) may not be subject to backup withholding. Non-corporate foreign shareholders should complete and sign the main signature form and a Form W-8, Certificate of Foreign Status, a copy of which may be obtained from the Depositary, in order to avoid backup withholding. See Instruction 9 to the Letter of Transmittal. 4. WITHDRAWAL RIGHTS. Tenders of Shares made pursuant to the Offer are irrevocable except that Shares tendered pursuant to the Offer may be withdrawn pursuant to the procedures set forth below at any time prior to the Expiration Date and, unless theretofore accepted for payment by the Purchaser pursuant to the Offer, may also be withdrawn at any time after November 3, 1997. To be effective, a written, telegraphic, telex or facsimile transmission notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase. Any notice of withdrawal must specify the name of the person having tendered the Shares to be withdrawn, the number of Shares to be withdrawn and the names in which the certificate(s) evidencing the Shares to be withdrawn are registered, if different from that of the person who tendered such Shares. The signature(s) on the notice of withdrawal must be guaranteed by an Eligible Institution, unless such Shares have been tendered for the account of any Eligible Institution. If Shares have been tendered pursuant to the procedures for book-entry 7 18 tender as set forth in Section 3, any notice of withdrawal must specify the name and number of the account at the Depository Institution to be credited with the withdrawn Shares. If certificates have been delivered or otherwise identified to the Depositary, the name of the registered holder and the serial numbers of the particular certificates evidencing the Shares withdrawn must also be furnished to the Depositary as aforesaid prior to the physical release of such certificates. All questions as to the form and validity (including time of receipt) of any notice of withdrawal will be determined by the Purchaser, in its sole discretion, which determination shall be final and binding. None of the Purchaser, Parent, the Depositary, the Information Agent, or any other person will be under any duty to give notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give such notification. Withdrawals of tenders of Shares may not be rescinded, and any Shares properly withdrawn will be deemed not to have been validly tendered for purposes of the Offer. However, withdrawn Shares may be retendered by following one of the procedures described in Section 3 at any time prior to the Expiration Date. If the Purchaser extends the Offer, is delayed in its acceptance for payment of Shares, or is unable to accept for payment Shares pursuant to the Offer, for any reason, then, without prejudice to the Purchaser's rights under this Offer but in accordance with any applicable rules or interpretations of the Commission, the Depositary may, nevertheless, on behalf of the Purchaser, retain tendered Shares, and such Shares may not be withdrawn except to the extent that tendering shareholders are entitled to exercise, and do duly exercise, withdrawal rights as set forth in this Section 4. 5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. Sales of Shares pursuant to the Offer and the exchange of Shares for cash pursuant to the Merger will be taxable transactions for Federal income tax purposes and may also be taxable under applicable state, local and other tax laws. For Federal income tax purposes, a shareholder whose Shares are purchased pursuant to the Offer or who receives cash as a result of the Merger will realize gain or loss equal to the difference between the adjusted basis of the Shares sold or exchanged and the amount of cash received therefor. Such gain or loss will be capital gain or loss if the Shares are held as capital assets by the shareholder. A shareholder (other than certain exempt shareholders including, among others, certain corporations, foreign individuals and foreign entities) who tenders Shares may be subject to 31% backup withholding unless the shareholder provides its TIN and certifies that such number is correct or properly certifies that it is awaiting a TIN, or unless an exemption applies. A shareholder that does not furnish its TIN may be subject to a penalty imposed by the IRS. See Section 3. If backup withholding applies to a shareholder, the Depositary is required to withhold 31% from payments to such shareholder. Backup withholding is not an additional tax. Rather, the amount of the backup withholding can be credited against the federal income tax liability of the person subject to the backup withholding, provided that the required information is given to the IRS. If backup withholding results in an overpayment of tax, a refund can be obtained by the shareholder upon filing an appropriate income tax return. THE INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE TO SHAREHOLDERS IN SPECIAL SITUATIONS SUCH AS SHAREHOLDERS WHO RECEIVED THEIR SHARES UPON THE EXERCISE OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION AND SHAREHOLDERS WHO ARE NOT UNITED STATES PERSONS. SHAREHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE OFFER AND THE MERGER, INCLUDING THE APPLICATION AND EFFECT OF STATE, LOCAL, FOREIGN OR OTHER TAX LAWS. 6. PRICE RANGE OF SHARES; DIVIDENDS. The Shares are listed on The Nasdaq Stock Market, Inc.'s ("Nasdaq") National Market (the "Nasdaq NM") and trade under the symbol VRSA. The following table 8 19 sets forth, for the periods indicated, the high and low last reported sales prices for the Shares on the Nasdaq NM and the amount of cash dividends paid per Share, based upon public sources:

• ------------------------- * Including a special cash dividend of $.35 per Share. ** On July 22, 1997, the Board of Directors of the Company announced an increase in the Company's regular quarterly dividend from $.10 to $.11 per Share, beginning on November 10, 1997 to shareholders of record on October 31, 1997. On August 27, 1997, the last full trading day prior to the Company's press release indicating a possible transaction was being negotiated with Parent at a price of $24.625 per Share, the last reported sales price of the Shares on the Nasdaq NM was $18.00. On September 2, 1997, the last full trading day prior to announcement that the Merger Agreement had been signed, the last reported sales price on the Nasdaq NM was $22.125. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES. The Rights trade together with the Common Stock. Upon the occurrence of a Distribution Date, the Rights are to detach, and may trade separately, from the Common Stock. See Section 7. The Company has entered into an amendment to the Rights Agreement so that a Distribution Date will not occur in connection with the Merger Agreement, the Offer or the Merger. See Sections 3 and 7. However, if the occurrence of a Distribution Date is otherwise triggered and the Rights begin to trade separately from the Common Stock, shareholders should also obtain current market quotations for the Rights. 7. CERTAIN INFORMATION CONCERNING THE COMPANY. The Company is a Delaware corporation with its principal offices at 9301 Washington Avenue, Racine, Wisconsin 53408. The following description of the Company's business has been taken from the Company's Form 10-K for the fiscal year ended March 31, 1997 (the "Company 10-K"): The Company comprises three business segments serving diverse markets. The Electronics Segment designs and manufactures custom electronic and electrical systems for a broad range of applications. The Engineered Materials Segment fabricates custom components from elastomers for special applications requiring a high degree of engineering expertise and product quality. The Fluid Power Segment manufactures custom engineered cylinders; hydraulic devices that raise, lower, stabilize, or level semitrailers, trucks, recreational vehicles and a variety of off-highway vehicles and equipment; and electrically powered systems that serve as drive mechanisms for slideout rooms on trailers and recreational vehicles. Selected Consolidated Financial Data. Set forth below is certain summary consolidated financial information for the Company's last three fiscal years ended March 31, 1997 as contained in the Company 10-K and for the three months ended June 30, 1997 as contained in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997. More comprehensive financial information is included in such reports (including management's discussion and analysis of financial condition and results of operations) and 9 20 other documents filed by the Company with the Commission, and the following summary is qualified in its entirety by reference to such reports and other documents and all of the financial information and notes contained therein. Copies of such reports and other documents may be examined at or obtained from the Commission or from Nasdaq in the manner set forth below under "Available Information". VERSA TECHNOLOGIES, INC. SELECTED CONSOLIDATED FINANCIAL INFORMATION (IN THOUSANDS, EXCEPT PER SHARE DATA)

The Company has indicated that it intends to borrow up to $6,000,000 from its existing credit facility to fund the repurchase of options and the payment of certain deferred compensation liabilities in connection with the Merger. See Section 10. Upon completion of the Merger, this indebtedness will become indebtedness of the Surviving Corporation. In connection with Parent's review of the Company and in the course of the negotiations between the Company and Parent described in Section 10, the Company provided Parent with certain business and financial information which Parent and the Purchaser believe is not publicly available. The additional information included business plans, forecasts, customer and supplier information and current results for the Company's segments including business unit detail. Results of various environmental procedures that had been performed during the past few years, as well as current union contracts, health and welfare plans and employee agreements, were also received. The Rights. Prior to entering into the Merger Agreement, the Company amended the Rights Agreement so that neither Parent nor the Purchaser will be deemed an Acquiring Person (as defined below), no Stock Acquisition Date or Distribution Date (each as defined below) will occur or be deemed to occur, and the Rights will not become subject to an adjustment or become exercisable or separate from the Shares as a result of entry into the Merger Agreement, commencement or consummation of the Offer or the Merger, or the other transactions contemplated by the Merger Agreement. Set forth below is a summary description of the publicly available information concerning the Rights. According to the Company's Registration Statement on Form 8-A, dated December 13, 1988 and filed with the Commission on December 16, 1988 (the "Company 8-A"), the Board of Directors of the Company declared a dividend on December 13, 1988 of one Right for each outstanding share of Common Stock. The dividend was payable on December 21, 1988 to shareholders of record on that date (the "Record Date"). 10 21 Each Right entitles the registered holder to purchase from the Company one one-hundredth of a share of Series A Junior Participating Preferred Stock, $.01 par value (the "Preferred Shares"), of the Company at a price of $60 per one one-hundredth of a Preferred Share, subject to adjustment (the "Purchase Price"). The description and terms of the Rights are set forth in the Rights Agreement between the Company and the Rights Agent, which was included as an exhibit to the Company 8-A. The following information concerning the Rights and the Rights Agreement is taken from or is based upon information presented in the Company 8-A. The Rights are represented by and traded with the Common Stock certificates and are not exercisable or transferable apart from the Common Stock until the earlier of (i) twenty business days after a public announcement that a person or group has acquired beneficial ownership of 20% or more of the Voting Power (such person or group being called an "Acquiring Person" and such date of first public announcement being called the "Stock Acquisition Date") or (ii) twenty business days after a person or group commences, or announces it intends to commence, a tender or exchange offer, the consummation of which would give such person or group 30% or more of the Voting Power (the earlier of such days being called the "Distribution Date"). "Voting Power" means the voting power of all securities of the Company then outstanding generally entitled to vote for the election of directors of the Company. Separate certificates for the Rights will be mailed to holders of Common Stock as of the Distribution Date, and thereafter the separate Rights certificates alone will evidence the Rights. The Preferred Shares comprise a series of preferred stock that is nonredeemable and which may rank junior to other series of preferred stock of the Company that may be issued in the future. Each Preferred Share will be entitled to a minimum preferential quarterly dividend of $5 per share but will be entitled to an aggregate dividend equal to 100 times the dividend declared per share of Common Stock. In the event of liquidation, each Preferred Share will be entitled to a minimum preferential liquidation payment of $6,000 per share but will be entitled to an aggregate payment of 100 times the payment made per share of Common Stock. Each Preferred Share will have 100 votes, voting together with the Common Stock. Finally, in the event of any merger, consolidation or other transaction in which shares of Common Stock are exchanged, each Preferred Share will be entitled to receive 100 times the amount received per share of Common Stock. These rights are protected by customary antidilution provisions. Because of the nature of the Preferred Shares' dividend, liquidation and voting rights, the value of the one one-hundredth of a share purchasable upon exercise of each Right should approximate the value of one share of the Common Stock. In the event that, after December 21, 1988, any person becomes the beneficial owner of 30% or more of the Voting Power, the Rights will adjust so that, assuming the Rights are then exercisable, each Right (other than Rights held by an Acquiring Person) will entitle its holder to purchase, at the then current price of the Right, that number of shares of Common Stock of the Company having, at the time of such transaction, a market value of two times the exercise price of the Right. However, the Rights will not so adjust if the event causing the 30% ownership threshold to be crossed is a tender offer or exchange offer for all outstanding shares of Common Stock at a price and on terms determined by a majority of the members of the Board of Directors of the Company who are not officers of the Company and who are Continuing Directors (as defined below), after receiving advice from the Board's financial advisors, to be at a fair price and otherwise in the best interests of the Company and its shareholders, provided that such tender offer results in the offeror beneficially owning at least 80% of the Voting Power (a "Fair Tender Offer"). Furthermore, in the event that, on or after the Stock Acquisition Date, the Company is acquired in a merger or other business combination or 50% or more of its assets or earning power is sold, each Right, assuming it is then exercisable, will entitle its holder to purchase, at the then current exercise price of the Right, that number of shares of Common Stock of the surviving company having, at the time of such transaction, a market value of two times the exercise price of the Right. In the event that the Company is the surviving corporation in a merger involving an Acquiring Person and the Common Stock is not changed or exchanged, or in the event of certain types of self-dealing transactions by an Acquiring Person, each Right (other than Rights owned by the Acquiring Person), assuming it is then exercisable , will entitle its holder to purchase at the then current exercise price of the Right, that number of shares of Common Stock of the Company having, at the time of such transaction, a market value of two times the exercise price of the Right. 11 22 Notwithstanding the foregoing, the provisions of this paragraph will not apply to a "second-step" merger or other business combination between the Company and an Acquiring Person who has completed a Fair Tender Offer, provided that the price per share of Common Stock offered in the second-step transaction is not less than the price paid in the Fair Tender Offer and the form of consideration offered in the second-step transaction is the same as that paid in the Fair Tender Offer. At any time after the Distribution Date, the Board of Directors of the Company may exchange the Rights (other than Rights owned by such Acquiring Person, if they have become void), in whole or in part, at an exchange ratio of one share of Common Stock, or one one-hundredth of a Preferred Share (or of a share of a class or series of the Company preferred stock having equivalent rights, preferences and privileges), per Right (subject to adjustment). Under certain circumstances, authorization of any such exchange must be by a majority of the Continuing Directors (as defined below) then in office. At any time prior to the occurrence of an event that causes each Right to become exercisable for Common Stock (or common stock of an acquiring company) having a market value of two times the exercise price of the Right (a "Triggering Event"), the Company, at its option, may redeem the Rights at a price of $.01 per Right (the "Redemption Price"); provided that if the Board of Directors of the Company authorizes redemption of the Rights under certain circumstances, there must be at least one Continuing Director and such authorization shall require the approval of a majority of the Continuing Directors then holding office. Immediately upon the authorization of the redemption of the Rights by the Board of Directors of the Company, the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. "Continuing Director" means a director who (i) either (A) was a member of the Board of Directors of the Company prior to December 21, 1988, or (B) subsequently became a director of the Company and whose initial election or initial nomination for election subsequent to such date was approved by a vote of a majority of the Continuing Directors then on the Board of Directors of the Company, and (ii) is not an Acquiring Person or an affiliate or associate of an Acquiring Person or a representative of an Acquiring Person or any such affiliate or associate. The Rights expire on December 21, 1998, unless earlier redeemed by the Company as described above. Until a Right is exercised, the holder thereof has no rights as a stockholder of the Company, including without limitation, the right to vote or to receive dividends. So long as the Rights are attached to the Common Stock, the Company issues one Right with each new share of Common Stock issued so that all such shares will have attached Rights. No fractional shares will be issued, other than fractional Preferred Shares that are integral multiples of one one-hundredth of a share, and a cash payment will be made in lieu thereof based on the market price of the preferred stock or Common Stock on the last trading day prior to the date of exercise. The Board of Directors of the Company may amend the Rights Agreement. After the Distribution Date, however, the Board of Directors of the Company may amend the Rights Agreement only to cure any ambiguity, to cure any defective or inconsistent provisions, to make changes which do not adversely affect the interest of the holders of the Rights (other than an Acquiring Person or an affiliate or associate of an Acquiring Person) or to shorten or lengthen any time period under the Rights Agreement; provided that no amendment to adjust the time period governing redemption may be made at any time when the Rights are not redeemable. In addition, no supplement or amendment may be made which changes the Redemption Price, the final expiration date, the Purchase Price or the number of Preferred Shares for which a Right is exercisable, unless at the time of such supplement or amendment there is no Acquiring Person and such supplement or amendment does not adversely affect the interests of the holders of Rights certificates (other than an Acquiring Person or an affiliate or associate of an Acquiring Person). As described above, prior to entering into the Merger Agreement and as authorized by the Board of Directors of the Company, the Company amended the Rights Agreement, effective September 2, 1997, making the Rights Agreement inapplicable to the Offer, the Merger and the other transactions contemplated by the Merger Agreement. 12 23 The foregoing summary of the Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement. The Rights Agreement should be available for inspection and copies thereof should be obtainable in the manner set forth below under "Available Information". Company Information. Except as otherwise set forth herein, the information concerning the Company contained in this Offer to Purchase has been taken from or based upon publicly available documents and records on file with the Commission and other public sources and is qualified in its entirety by reference thereto. Although Parent has no knowledge that would indicate that any statements contained herein based on such documents and records are untrue, Parent cannot take responsibility for the accuracy or completeness of the information contained in such documents and records, or for any failure by the Company to disclose events which may have occurred or may affect the significance or accuracy of any such information but which are unknown to Parent. Available Information. The Company is subject to the information and reporting requirements of the Exchange Act and in accordance therewith is obligated to file reports and other information with the Commission relating to its business, financial condition and other matters. Information, as of particular dates, concerning the Company's directors and officers, their remuneration, stock options granted to them, the principal holders of the Company's securities, any material interests of such persons in transactions with the Company and other matters is required to be disclosed in proxy statements distributed to the Company's shareholders and filed with the Commission. Such reports, proxy statements and other information are available for inspection and copying at the public reference facilities of the Commission located at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices at Seven World Trade Center, 13th Floor, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. The Commission also maintains an Internet site on the World Wide Web at