Document:

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                                                                    EXHIBIT 10.6

                      SERIES B CONVERTIBLE PREFERRED STOCK

                               PURCHASE AGREEMENT

                                  BY AND AMONG

                RIVER CITIES CAPITAL FUND II LIMITED PARTNERSHIP,

                                JG FUNDING, LLC,

                          SAUNDERS CAPITAL GROUP, LLC,

                              IRVING W. BAILEY II,

                                   DPEC, INC.

                                       AND

                                 CAROL A. CLARK

                                 AUGUST 27, 1999

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                                TABLE OF CONTENTS

<TABLE>
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                                                                           PAGE
<S>                                                                        <C>
1.    Sale and Issuance of Series B Convertible Preferred Stock..............1

2.    Closing................................................................2

3.    Closing Items..........................................................2

4.    Benefit Plans..........................................................3

5.    Further Assurances.....................................................4

6.    Representations and Warranties of the Company and Clark................4
       6.1     Corporate Standing............................................4
       6.2     Authorization.................................................5
       6.3     Capitalization................................................5
       6.4     Validly Issued Shares.........................................6
       6.5     No Conflict...................................................6
       6.6     Contracts and Other Commitments; Compliance...................6
       6.7     Subsidiaries..................................................7
       6.8     Consents......................................................7
       6.9     Financial Statements..........................................7
       6.10    Indebtedness for Borrowed Money; No Undisclosed Liabilities...7
       6.11    Title to Property and Assets; Leases..........................8
       6.12    Legal Proceedings.............................................8
       6.13    Environmental Matters.........................................8
       6.14    Licenses and Permits; Compliance with Laws....................8
       6.15    Employee Benefit Plans........................................9
       6.16    Labor Relations...............................................9
       6.17    Insurance....................................................10
       6.18    Tax Matters..................................................10
       6.19    Changes in Circumstances.....................................10
       6.20    Patents and Trade Names, Etc.................................12
       6.21    Affiliated Transactions......................................13
       6.22    Bank Accounts................................................13
       6.23    Brokers'and Finders'Fees.....................................13
       6.24    Registration Rights..........................................13
       6.25    Small Business Concern.......................................14
       6.26    Material Facts...............................................14
       6.27    Clark Debt Repayment Obligations.............................14
       6.28    Year 2000 Compliance.........................................14

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7.    Representations and Warranties of the Investors.......................15
       7.1     Authorization; Binding Agreement.............................15
       7.2     Investment Representations...................................15
       7.3     Accredited Investor; Residence...............................15
       7.4     Receipt of Information; Restricted Securities................15
       7.5     Investment Experience........................................16

8.    Survival of Representations and Warranties............................16

9.    Indemnification.......................................................16
       9.1     Indemnification by the Company...............................16
       9.2     Indemnification by Clark.....................................17
       9.3     Indemnification by an Investor...............................17

10.   Covenants of the Company (and Clark solely with respect to
      Section 10.6).........................................................17
       10.1    Insurance....................................................17
       10.2    Financial Reporting..........................................17
       10.3    Board of Directors...........................................18
       10.4    Reservation of Shares........................................18
       10.5    Use of Proceeds..............................................19
       10.6    Clark Debt Repayment Obligations.............................19
       10.7    Compliance with Small Business Investment Act................19
       10.8    Negative Covenants...........................................19
       10.9    Definition of a Qualified Sale...............................20

11.   Restrictions of Transfers.............................................20
       11.1    Notice of Sale by Clark......................................20
       11.2    Definition of Qualified IPO..................................20
       11.3    Co-Sale Right................................................21
       11.4    Rights of Refusal............................................21
       11.5    Exceptions...................................................22
       11.6    Right of First Refusal.......................................22
       11.7    Right of First Offer.........................................22
       11.8    Restrictive Legend...........................................23
       11.9    Preemptive Rights............................................23

12.   Default...............................................................24
       12.1    Events of Default............................................24
       12.3    Diversion of Proceeds........................................24
       12.4    Loss of Clark................................................24

13.   Public Statements.....................................................25

14.   Notices...............................................................25

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15.   Parties in Interest; Assignment.......................................26

16.   Construction; Governing Law...........................................26

17.   Entire Agreement; Amendment and Waiver................................27

18.   Severability..........................................................27

19.   Counterparts..........................................................27

20.   Expenses..............................................................27

21.   Time of Essence.......................................................27

22.   Confidentiality Agreement.............................................27

23.   Attorneys'Fees........................................................27

24.   Rights of the Investors...............................................28

25.   Termination Upon a Qualified IPO......................................28

26.   Termination of Certain Provisions.....................................28

27.   Pronouns..............................................................28
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                      SERIES B CONVERTIBLE PREFERRED STOCK
                               PURCHASE AGREEMENT

          THIS SERIES B CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
("Agreement") is made and entered into as of the 27th day of August, 1999, by
and among RIVER CITIES CAPITAL FUND II LIMITED PARTNERSHIP, a Delaware limited
partnership ("River Cities"); JG FUNDING, LLC, a Kentucky limited liability
company ("JG"); SAUNDERS CAPITAL GROUP, LLC, a Kentucky limited liability
company ("Saunders"); IRVING W. BAILEY II, an individual ("Bailey") (River
Cities, JG, Saunders and Bailey are hereinafter sometimes referred to
individually as an "Investor" and collectively as the "Investors"); DPEC, INC.,
an Ohio corporation (the "Company"); and CAROL A. CLARK ("Clark").

          WITNESSETH:

          On September 15, 1998, the Company, Clark and River Cities Capital
Group II Limited Partnership ("Group"), an affiliate of River Cities, entered
into a certain Senior Convertible Preferred Stock Purchase Agreement (the
"Senior Preferred Stock Purchase Agreement") pursuant to which, for an aggregate
purchase price of $2,000,000, the Company sold to Group and Group purchased from
the Company, 5,123 shares of the Senior Preferred Stock (as defined in the
Senior Preferred Stock Purchase Agreement).

          On February 22, 1999, Group assigned the Senior Preferred Stock to
River Cities.

          The Company desires to sell and issue, and the Investors desire to
purchase and acquire, $3,000,121 of shares of the Company's authorized but
unissued Series B Convertible Preferred Stock upon the terms and subject to the
conditions contained herein. The shares of Senior Preferred Stock and the Series
B Convertible Preferred Stock are sometimes referred to herein collectively as
the "Preferred Stock."

          NOW, THEREFORE, in consideration of the mutual covenants,
representations and warranties herein contained, and intending to be legally
bound, the Company, Clark and the Investors agree as follows:

          1.      SALE AND ISSUANCE OF SERIES B CONVERTIBLE PREFERRED STOCK.

                  1.1      The Company shall adopt and file with the Secretary
of State of Ohio on or before the Closing (as defined below) the Certificate of
Amendment of Articles of Incorporation in the form attached hereto as EXHIBIT A
(the "Amended Articles"). The Series B Convertible Preferred Stock, no par value
per share (the "Series B Preferred Stock"), will have the rights, preferences
and privileges and restrictions set forth in the Amended Articles.

                  1.2      Subject to the terms and conditions of this
Agreement, at the Closing the Investors agree to purchase from the Company, and
the Company agrees to sell, issue and deliver

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to the Investors, an aggregate of 2,979 shares of the Series B Preferred Stock
at the price of $1,007.09 per share resulting in a total purchase price at the
Closing of $3,000,121, allocated among the Investors as follows:

<TABLE>
<CAPTION>

       Investor                Number of Shares            Total Purchase Price
       --------                ----------------            --------------------
<S>                            <C>                         <C>
       River Cities                  1,490                      $1,500,564
       JG                              993                      $1,000,040
       Saunders                        198                      $  199,404
       Bailey                          298                      $  300,113
                                     -----                      ----------
                   Total             2,979                      $3,000,121
</TABLE>

                  1.3      Effective upon the Closing, the Company shall grant
to the Investors registration rights under the Securities Act of 1933, as
amended (the "Securities Act"), on the terms and subject to the conditions of
the Registration Rights Agreement in the form attached hereto as EXHIBIT B
("Registration Rights Agreement").

          2.      CLOSING. The closing of the transactions contemplated by this
Agreement (the "Closing") will occur simultaneously with the execution of this
Agreement and shall take place on or before August 27, 1999, either by facsimile
or at the offices of Graydon, Head & Ritchey, counsel to the Investors, 1900
Fifth Third Center, 511 Walnut Street, Cincinnati, Ohio 45202, or at such other
time, date, or place as shall be mutually agreed upon by the parties hereto in
writing (the "Closing Date").

          3.      CLOSING ITEMS.

                  3.1      At the Closing, the Company shall deliver, or cause
to be  delivered,  the following items:

                           3.1.1 the Amended Articles as file stamped by the
Ohio Secretary of State;

                           3.1.2 the Amended and Restated Code of Regulations
(as amended by agreed amendments) in the form attached hereto as EXHIBIT C
("Restated Regulations"), certified as to their current form by the Secretary of
the Company;

                           3.1.3 the Amended and Restated Registration Rights
Agreement duly executed by the Company;

                           3.1.4 the Fourth Amended and Restated Shareholders
Agreement among the Company, Clark, Fran Papalios ("Papalios") and Frances
Papalios, as trustee and grantor of the Frances Papalios Trust, in the form
attached hereto as EXHIBIT D duly executed by each of such parties (the
"Shareholders Agreement");

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                           3.1.5 the opinion of Vorys, Sater, Seymour and Pease
LLP, counsel to the Company, in the form attached hereto as EXHIBIT E

                           3.1.6 resolutions of the Board of Directors and
shareholders of the Company authorizing the execution, delivery and consummation
of this Agreement, the filing of the Amended Articles, the issuance of the
shares of Series B Preferred Stock, the adoption of the agreed amendments to the
Restated Regulations, and the other matters contemplated hereby, certified as to
their due adoption and continued validity by the Secretary of the Company; and

                           3.1.7 the completed United States Small Business
Administration ("SBA") Parts A and B of Form 1031.

                           3.1.8 a certificate in each Investor's name
representing the portion of the 2,979 shares of Series B Preferred Stock that
such Investor is purchasing; and

                           3.1.9 a certificate, in form reasonably acceptable to
the Investors and dated as of the Closing Date, from the Company, duly executed
by the President of the Company and by Clark, individually, as follows: (i)
except for changes expressly contemplated by the terms of this Agreement or
approved by the Investors, the representations and warranties of the Company and
Clark contained in this Agreement are true and complete in all material respects
on and as of the Closing Date as if made on and as of that date; and (ii) the
Company and Clark have complied with or performed in all material respects all
terms, covenants and conditions to be complied with or performed by them on or
prior to the Closing Date.

                  3.2      At the Closing, the Investors shall deliver, or cause
 to be delivered:

                           3.2.1 immediately available funds equal to the
aggregate purchase price of $3,000,121; and

                           3.2.2 the Amended and Restated Registration Rights
Agreement, duly executed by the Investors; and

                           3.2.3 a certificate, in form reasonably acceptable to
the Company and dated as of the Closing Date, from each Investor, duly executed
by its General Partner or Manager as appropriate, as follows: (i) except for
changes expressly contemplated by the terms of this Agreement or approved by the
Company, the representations and warranties of the Investor contained in this
Agreement are true and complete in all material respects on and as of the
Closing Date as if made on and as of that date; and (ii) the Investor has
complied with or performed in all material respects all terms, covenants and
conditions to be complied with or performed by it on or prior to the Closing
Date.

          4.      BENEFIT PLANS. Subsequent to the Closing, senior management,
employees and non-employee directors and consultants (a) may be granted
options pursuant to the 1998 Stock Option Plan or any successor thereto (the
"Plan"), with such Options to be exercisable for shares of Common Stock, no
par value per share ("Common Stock"), and (b) may be issued shares of

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 Common Stock pursuant to such other employee benefit plans as the Company
may hereafter adopt. All such grants of options and issuances of shares of
Common Stock shall be on such terms and conditions as the Compensation
Committee of the Board of Directors may determine; provided, however: (a) the
options granted (excluding options granted pursuant to an employee stock
purchase plan as described in Section 423 of the Internal Revenue Code of
1986, as amended ("Excluded Options") shall not exceed in the aggregate ten
percent (10%) of the fully diluted shares of capital stock of the Company
(including the Preferred Stock on an as converted basis and the shares of
Common Stock issued upon the exercise of outstanding options) without the
prior written consent of the designated representative on the Compensation
Committee of the holders of the Preferred Stock; (b) included in such number
of options shall be the 345 outstanding "conditional" options previously
issued to key employees by the Company or options granted under the Plan in
exchange for such conditional options, it being understood that the Company
may exchange some or all of the 345 conditional options for options under the
Plan; and (c) without the prior written consent of the designated
representative on the Compensation Committee of the holders of the Preferred
Stock: (i) the price per share, including the exercise price per share of
Common Stock covered by any options granted by the Company (excluding
Excluded Options), shall not be less than the fair market value per share of
the Common Stock at the time of grant, and (ii) the exercise price per share
of Common Stock covered by any Excluded Options granted by the Company shall
not be less than eighty-five percent of the fair market value per share of
the Common Stock at the time of grant. For purposes of the shares of Common
Stock authorized for issuance pursuant to the Plan, the fair market value of
the Common Stock at the time of the option grant shall be determined at least
annually by the Board of Directors.

          5.      FURTHER ASSURANCES. Each party shall execute such additional
documents and take such other actions as the other party or parties may
reasonably request to consummate the transactions contemplated hereby and
otherwise as may be necessary to effectively carry out the terms and provisions
of this Agreement.

          6.      REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND CLARK. The
Company hereby represents and warrants to the Investors, as of the date hereof
and as of the Closing Date (and Clark hereby represents and warrants to the
Investors as of the Closing Date solely with respect to the last sentence of
Section 6.20.1 and all of Section 6.27), as follows:

                  6.1      Corporate Standing. The Company is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Ohio. The Company has all requisite corporate power and authority to own, lease
and operate its properties and to carry on its business as now being conducted
and as presently proposed to be conducted and to execute, deliver and perform
this Agreement, the Amended and Restated Registration Rights Agreement and any
other agreement to which the Company is a party, the execution and delivery of
which is contemplated hereby (the "Ancillary Agreements"). The Company is duly
licensed, authorized and qualified to do business and is in good standing in all
jurisdictions (domestic or foreign) in which the conduct of its business or the
ownership or leasing of its properties requires it to be so licensed, authorized
or qualified, except where its failure to be so licensed, authorized or
qualified would not constitute a Material Adverse Effect. For purposes of this
Agreement,

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"Material Adverse Effect" means any event or circumstance or any action taken or
omitted to be taken by or on behalf of the Company which has constituted, or
with reasonable certainty will constitute, a material adverse effect, singly or
in the aggregate, on the condition (financial or otherwise), properties,
business, operations or prospects of the Company, taken as a whole. True and
accurate copies of the articles of incorporation (and all amendments thereto),
code of regulations (and all amendments thereto) and minute book (containing the
records of meetings and written consents of the shareholders, the board of
directors and any committees of the board of directors) of the Company have
previously been delivered to legal counsel to the Investor.

                  6.2       AUTHORIZATION. The execution and delivery of this
Agreement, the Amended and Restated Registration Rights Agreement and any
Ancillary Agreement and the consummation of the transactions contemplated hereby
and thereby have been duly authorized by all necessary corporate action on the
part of the Company. Each of this Agreement, the Amended and Restated
Registration Rights Agreement and any Ancillary Agreement has been duly executed
and delivered by the Company and constitutes the legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and (ii) the availability of equitable remedies may be limited by
equitable principles of general applicability.

                  6.3       CAPITALIZATION. The authorized capital stock of the
Company consists of (i) 70,000 shares of Common Stock of which as of the date
hereof 33,737 shares are validly issued and outstanding, fully paid and
non-assessable, 5,123 shares of which have been duly and validly reserved for
issuance upon conversion of the Senior Preferred Stock, and 2,979 shares of
which have been duly and validly reserved for issuance upon conversion of the
Series B Preferred Stock, (ii) 5,123 shares of Senior Preferred Stock of which
as of the date hereof 5,123 shares are validly issued and outstanding, fully
paid and non-assessable, and (iii) 2,979 shares of Series B Preferred Stock,
none of which are outstanding as of the date hereof. Except as set forth on
SCHEDULE 6.3 or as contemplated by this Agreement, the Senior Preferred Stock
Purchase Agreement, the Amended Articles, the Amended and Restated Registration
Rights Agreement and Ancillary Agreements, there are outstanding no
subscriptions, options, warrants, calls, commitments or rights (including
conversion or preemptive rights and rights of first refusal), proxy or
shareholder agreements or agreements of any character relating to shares of the
Company's capital stock or any instruments that can be converted into shares of
the Company's capital stock. None of the shares of the Company's capital stock
have been issued in violation of any preemptive right. All issuances, transfers
or purchases of the capital stock of the Company have been in compliance with
all applicable agreements and all applicable laws, including federal and state
securities laws, and all taxes thereon, if any, have been paid. Except as set
forth on SCHEDULE 6.3, no former or present holder of any of the shares of
capital stock of the Company has any legally cognizable claim against the
Company based on any issuance, sale, purchase, redemption or involvement in any
transfer of any shares of capital stock by the Company. Except as contemplated
by this Agreement, the Senior Preferred Stock Purchase Agreement or as set forth
on SCHEDULE 6.3, there are no contractual obligations of the Company to
repurchase, redeem or otherwise acquire any shares of capital stock of the
Company. No bonds, debentures, notes or other indebtedness having the right to
vote (or convertible into or

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exercisable for securities having the right to vote) on any matters on which
shareholders of the Company may vote are issued or outstanding. Except for this
Agreement, the Senior Preferred Stock Purchase Agreement and the Shareholders
Agreement, the Company is not a party or subject to any agreement or
understanding, and, to the Company's best knowledge, there is no agreement or
understanding between any persons that affects or relates to the voting or
giving of written consents with respect to any security or the voting by any
director of the Company.

                  6.4       VALIDLY ISSUED SHARES. The shares of Series B
Preferred Stock to be issued, sold and delivered in accordance with the terms of
this Agreement for the consideration set out herein, will, upon issuance in
accordance with the terms hereof, be duly and validly issued, fully paid and
non-assessable, free of restrictions on transfer other than restrictions on
transfer under this Agreement and under applicable federal and state securities
laws. The issuance of the Series B Preferred Stock to the Investors pursuant to
this Agreement will comply with all applicable laws, including federal and state
securities laws (assuming the accuracy of the representations set forth in
Sections 7.2 through 7.5 hereof), and will not violate the preemptive rights of
any person. The Common Stock issuable upon conversion of the Series B Preferred
Stock being purchased under this Agreement will be, upon issuance and delivery
in accordance with the terms of the Amended Articles, duly and validly issued,
fully paid and non-assessable and free of restrictions on transfer other than
restrictions on transfer under this Agreement and under applicable federal and
state securities laws. The issuance of the Common Stock upon conversion of the
Series B Preferred Stock will comply with all applicable laws, including federal
and state securities laws (assuming the accuracy of the representations set
forth in Sections 7.2 through 7.5 hereof as of the date of issuance of such
Common Stock and of such Series B Preferred Stock), and will not violate the
preemptive rights of any person.

                  6.5      NO CONFLICT. Except as set forth on SCHEDULE 6.5, the
execution and delivery of this Agreement, the Amended and Restated Registration
Rights Agreement and any Ancillary Agreement do not, and the consummation of the
transactions contemplated hereby and thereby will not, conflict with, or result
in any violation of, or default (with or without notice or lapse of time, or
both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or the loss of a material benefit under, or the
creation of a lien, pledge, security interest, charge or other encumbrance on
assets (any such conflict, violation, default, right of termination,
cancellation or acceleration, loss or creation, a "Violation") pursuant to, any
provision of the Amended Articles or Restated Regulations, or result in any
Violation of any lease, agreement, obligation, instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company or the Company's properties or assets.

                  6.6       CONTRACTS AND OTHER COMMITMENTS; COMPLIANCE. Except
as set forth on SCHEDULE 6.6 or those which do not constitute a Material Adverse
Effect, the Company is not bound by any judgment, order, writ or decree, written
or oral, absolute or contingent. The Company has made available to the Investors
for their review prior to the date hereof a copy of all written contracts,
agreements, leases, loans, and commitments with a third party to which the
Company is a party (each a "Contract") and the Company has described to the
Investors the terms of any oral Contracts that are material to the condition
(financial or otherwise), properties,

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business, operations or prospects of the Company taken as a whole. Except those
which do not constitute a Material Adverse Effect, the Company is not in
violation or default of any provision of its Amended Articles or Restated
Regulations, any provision of a written or oral Contract, or any provisions of
any other items listed on SCHEDULE 6.6.

                  6.7      SUBSIDIARIES. As of the date of this Agreement, the
Company does not own or control, directly or indirectly, any interest in any
other corporation, partnership, limited liability company, association or other
business entity and is not a participant in any joint venture, partnership or
similar arrangement.

                  6.8      CONSENTS. Except as set forth on SCHEDULE 6.8, no
consent, approval, qualification, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or commission or
other governmental authority or instrumentality, domestic or foreign, or other
third party is required by or with respect to the Company in connection with the
execution and delivery of this Agreement, or the consummation by the Company of
the transactions contemplated hereby, which has not already been obtained,
except for notices of sale required to be filed with the Securities and Exchange
Commission under Regulation D of the Securities Act or such post closing filings
as may be required under applicable state securities laws which will be timely
filed within the applicable periods therefor.

                  6.9      FINANCIAL STATEMENTS. The Company has delivered to
the Investors prior to the date hereof the Company's balance sheet as of July
31, 1998, and the related statements of income and cash flows for the twelve
months ended July 31, 1998, the Company's unaudited balance sheet as of June 30,
1999 and the related unaudited statements of income and cash flows for the year
to date ended June 30, 1999, and SCHEDULE 6.9 related thereto (the "Financial
Statements"). The Financial Statements present fairly in all material respects
the financial condition and results of operations of the Company as of such
dates and the periods indicated and have been prepared in all material respects
in accordance with GAAP consistently applied during such periods except for the
omission of footnote disclosures and the omission of year-end adjustments.

                  6.10      INDEBTEDNESS FOR BORROWED MONEY; NO UNDISCLOSED
LIABILITIES. Except as and to the extent reflected in the Financial Statements
or on SCHEDULE 6.10, the Company has no direct or indirect indebtedness for
borrowed money, indebtedness by way of lease-purchase arrangements, guarantees,
undertakings, chattel mortgages or other security arrangements with any bank,
financial institution or other third party or any other material liability
required by GAAP to be disclosed in the Financial Statements.

                  6.11      TITLE TO PROPERTY AND ASSETS; LEASES.

                           6.11.1 SCHEDULE 6.11.1 sets forth a complete and
accurate list and description of all the real property that the Company owns or
leases and all personal property that the Company owns or leases that the
Company carries on its books at a value of greater than $100,000. Except as set
forth in SCHEDULE 6.11.1, the Company is not bound or committed to

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make any capital improvement or expenditure in excess of $100,000 with respect
to any single piece of owned or leased real or personal property.

                           6.11.2 Except as set forth in SCHEDULE 6.11.2, the
Company has good, valid and marketable title to all the personal and mixed,
tangible and intangible properties and assets which it purports to own, free and
clear of all liens, restrictions, claims, charges, security interests, easements
or other encumbrances of any nature whatsoever, except for liens for current
taxes not yet due and payable and except for liens, claims or other encumbrances
that do not constitute a Material Adverse Effect. With respect to the property
and assets that it leases, the Company is in compliance with such leases and
holds a valid leasehold interest free and clear of any liens, claims and
encumbrances except for liens, claims or other encumbrances that do not
constitute a Material Adverse Effect. Except in accordance with a valid license
or other agreement with the Company, all properties and assets of the Company
are in the possession or control of the Company, and no other person is entitled
to possession of any such properties and assets.

                  6.12      LEGAL PROCEEDINGS. Except as set forth on SCHEDULE
6.12, there are no claims of any kind or any actions, suits, proceedings,
arbitrations or investigations ("Legal Actions") pending or, to the Company's
knowledge, threatened against or affecting the Company or against any asset,
interest or right of any of them or which questions the validity of the
transactions contemplated by this Agreement and the Company does not know of any
facts which may constitute a basis for Legal Actions which would constitute a
Material Adverse Effect.

                  6.13      ENVIRONMENTAL MATTERS. The Company is not in
violation of any applicable statute, law or regulation relating to the
environment or occupational health and safety (the "Environmental Laws") except
to the extent that such violation does not constitute a Material Adverse Effect,
and as of the date hereof no material expenditures are required to be made by
the Company in order to comply with any of the Environmental Laws.

                  6.14     LICENSES AND PERMITS; COMPLIANCE WITH LAWS. Except as
set forth on SCHEDULE 6.14, the Company holds all franchises, permits, licenses,
variances, exemptions, orders and approvals of all governmental entities which
are required for the operation of the Company's business and is in compliance
with the terms thereof, except where the failure to so hold or to be in such
compliance would not constitute a Material Adverse Effect. The Company has
complied with and is not in any default under (and has not been charged with or
received notice with respect to, nor is threatened with or under investigation
with respect to, any charge concerning any violation of any provision of) any
federal, state or local law, regulation, ordinance, rule or order (whether
executive, judicial, legislative or administrative) or any order, writ,
injunction or decree of any court, agency or instrumentality, except where the
failure to be in compliance or where being in default would not constitute a
Material Adverse Effect, and no action, suit, proceeding, hearing,
investigation, charge, complaint, claim, demand, or notice has been filed or
commenced against any of them alleging any failures to comply.

                  6.15      EMPLOYEE BENEFIT PLANS. Except as set forth on
SCHEDULE 6.15, the Company has no employee benefit plans including any profit
sharing, deferred compensation,

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incentive compensation, stock ownership, stock purchase, phantom stock,
retirement, vacation, severance, disability, death benefit, hospitalization,
medical or other plan, arrangement or understanding (whether or not legally
binding) providing benefits to any current or former employee, officer or
director of the Company (collectively, the "Benefit Plans"), or any employment,
consulting, severance, termination or indemnification agreement, arrangement or
understanding between the Company and any officer, director or employee of the
Company. The Company has delivered to the Investors true, complete and correct
copies of each Benefit Plan, or, in the case of any unwritten Benefit Plans,
descriptions thereof. Each Benefit Plan has been administered in compliance with
its terms and all applicable laws except where the failure to be in compliance
would not constitute a Material Adverse Effect.

                  6.16      LABOR RELATIONS.

                           6.16.1 The Company is in compliance with all
applicable laws respecting employment and employment practices, terms and
conditions of employment and wages and hours and occupational safety and health
except where the failure to be in compliance would not constitute a Material
Adverse Effect.

                           6.16.2 There is no unfair labor practice charge or
complaint or any other matter against or involving the Company pending or, to
the Company's knowledge, threatened against the Company before the National
Labor Relations Board or any court of law.

                           6.16.3 There is no labor strike, dispute, slowdown or
stoppage actually pending or, to the Company's knowledge, threatened against the
Company.

                           6.16.4 The Company is not a party to or bound by any
collective bargaining agreement or any similar labor union arrangement.

                           6.16.5 There are no charges, investigations,
administrative proceedings or formal complaints of discrimination (including
discrimination based upon sex, age, marital status, race, color, religion,
national origin, sexual preference, disability, handicap or veteran status)
pending or, to the Company's best knowledge, threatened against the Company
before the Equal Employment Opportunity Commission or any federal, state or
local agency or court. There have been no governmental audits of the equal
employment opportunity practices of the Company and, to the Company's best
knowledge, no basis for any such claim of violation exists except where such
violation would not constitute a Material Adverse Effect.

                           6.16.6 The Company is in compliance with the
requirements of the Americans With Disabilities Act except where the failure to
be in compliance would not constitute a Material Adverse Effect.

                  6.17     INSURANCE. SCHEDULE 6.17 sets forth a list of all
insurance policies, including property, casualty, liability and other insurance
maintained with respect to the assets and business of the Company (the "Company
Insurance"). The Company is not liable for any material retroactive premium
adjustments with respect to any of its insurance policies or bonds.

                                       9
<PAGE>

All such policies and bonds are legal, valid and enforceable and in full force
and effect and the Company is not in breach or default (including with respect
to the payment of premiums or the giving of notices) and no event has occurred
which, with notice or the lapse of time or both, would constitute such a breach
or default, or permit termination, modification or acceleration under the
policy. The Company has not received any notice of premium increases or
cancellations with respect to any such policies and bonds except in the ordinary
course of business. The Company believes the amount and type of the Company
Insurance coverage is adequate for the Company's business and is consistent with
good business practice.

                  6.18     TAX MATTERS. Except as set forth on SCHEDULE 6.18,
the Company has timely filed or caused to be filed all federal, state, foreign
and local income, franchise, gross receipts, payroll, sales, use, withholding,
occupancy, excise, real and personal property, employment and other tax returns,
tax information returns and reports (the "Tax Returns") required to be filed and
all such Tax Returns were correct and complete in all respects, except where the
failure to file or to be correct and complete would not constitute a Material
Adverse Effect. The Company has paid, or made adequate provisions for the
payment of, all taxes, duties or assessments of any nature whatsoever, interest
payments, penalties and additions (whether or not reflected in the returns as
filed) due and payable (and/or property accruable for all periods ending on or
before the date of this Agreement) to any city, county, state, foreign country,
the United States or any other taxing authority, except where the failure to pay
or make adequate provisions for payment would not constitute a Material Adverse
Effect. There are no security interests on any of the assets of the Company that
arise in connection with any failure (or alleged failure) to pay timely any tax.
The Company has withheld and paid all taxes required to have been withheld and
paid in connection with amounts paid or owing to any employee, independent
contractor, creditor, shareholder or other third party, except where the failure
to withhold or pay would not constitute a Material Adverse Effect. Except as set
forth in SCHEDULE 6.18, no deficiencies for any taxes have been asserted or
assessed or, to the knowledge of the Company, proposed against the Company that
are not adequately reserved for.

                  6.19     CHANGES IN CIRCUMSTANCES. Except as set forth in
SCHEDULE 6.19 and except for any of the following actions which occur after the
Closing and are authorized by the Company's Board of Directors, since June 30,
1999 there has not been:

                           6.19.1 any change in the condition (financial or
otherwise), properties, business, operations or prospects of the Company, or any
event or circumstance, which constitutes a Material Adverse Effect;

                           6.19.2 any indebtedness, liability or obligation
(whether absolute, accrued, contingent or otherwise and whether due or to become
due) incurred by the Company or any transaction entered into by the Company,
other than in the ordinary course of business and consistent with past practice,
or any guarantee by the Company of any indebtedness, liability or obligation of
any other person;

                                       10
<PAGE>

                           6.19.3 any declaration, setting aside or payment of
any dividend or other distribution in respect of any of the capital stock or
other securities of the Company other than the minimum amount of distributions
required by the Shareholders Agreement;

                           6.19.4 any obligation, liability, lien or encumbrance
paid, discharged or satisfied by or on behalf of the Company, other than in the
ordinary course of business and consistent with past practice;

                           6.19.5 any mortgage, lien, pledge, charge or
encumbrance affecting the properties of the Company (except liens for current
taxes not yet due and payable) created, suffered or assumed by or on behalf of
the Company in excess of $50,000;

                           6.19.6 any sale, transfer or other disposition of any
tangible asset of the Company or any cancellation of any debt or claim owed the
Company, except in the ordinary course of business and consistent with past
practice, or any sale, transfer or other disposition of any of the Company's
intangible properties, assets or rights, except in the ordinary course of
business and consistent with past practice;

                           6.19.7 any loan made or increased by the Company,
including any loan to any officer, director, employee or agent of the Company or
to any member of their families, except for advances to non-executive officers
in the ordinary course of business;

                           6.19.8 any action taken or omitted to be taken by or
on behalf of the Company that would cause (after lapse of time, notice or both)
the breach, default or acceleration of any right, contact or other obligation of
the Company except where the breach, default or acceleration would not
constitute a Material Adverse Effect;

                           6.19.9 any material change in the compensation
arrangement or agreement with any officer, director, employee or agent of the
Company except in the ordinary course of business and consistent with past
practice; or

                           6.19.10 any agreement or commitment by the Company to
do any of the foregoing.

                  6.20     PATENTS AND TRADE NAMES, ETC.

                           6.20.1 SCHEDULE 6.20.1 sets forth a complete list of
all trade names, trademark and service mark registrations, common law
trademarks, copyright registrations and copyright applications currently owned
by the Company and a complete list of all works of authorship licensed to the
Company and from which the Company has created a courseware product on the basis
of such license (which, together with any proprietary works of authorship,
including software, owned by the Company for which there is no current copyright
registration or application, are referred to herein as the "Intellectual
Property"). The Company does not own or license any patents. Except as set forth
on SCHEDULE 6.20.1, all of the Intellectual Property is owned by the Company.
SCHEDULE 6.20.1 also indicates whether any of the Intellectual Property

                                       11
<PAGE>

was acquired by assignment to the Company or is used by the Company under
authority of a license. Except as set forth in SCHEDULE 6.20.1, to the knowledge
of the Company, no employees of the Company, past or present, claim or have
claimed any interest in the Intellectual Property and no basis for such claim
exists. Clark hereby acknowledges to and for the benefit of the Company and the
Investors that she claims no independent interest in the Intellectual Property
of the Company or any such intellectual property previously used in the business
of the Company other than by virtue of any ownership interest she may maintain
in the Company.

                           6.20.2 Except as provided on SCHEDULE 6.20.1, with
respect to the Intellectual Property listed thereon:

                           6.20.2.1 the Intellectual Property and all rights
appurtenant thereto are free and clear of any and all liens, claims, security
interests and other encumbrances of any nature or kind except for those which do
not constitute a Material Adverse Effect;

                           6.20.2.2 no prior transfer, sale or assignment has
been made by the Company of any part of any item constituting part of the
Intellectual Property or any rights appurtenant thereto;

                           6.20.2.3 each item constituting part of the
Intellectual Property which is owned by the Company has been duly registered
with, filed in or issued by, as the case may be, the United States Patent and
Trademark Office, and such registrations, filings and issuances remain in full
force and effect, or is otherwise protected as unregistered under common law
principles; and

                           6.20.2.4 the Intellectual Property constitutes all
intellectual property necessary for the Company to carry on its business as
presently conducted.

                           6.20.3 Except as set forth on SCHEDULE 6.20.3, there
are no pending or, to the knowledge of the Company, threatened proceedings or
litigation or other adverse claims affecting or with respect to the Intellectual
Property as currently used by the Company. Except as set forth on SCHEDULE
6.20.3, no person or entity is known to be infringing upon the Company's rights
with respect to the Intellectual Property. None of the operations, processes or
products of the Company are known to infringe upon or violate the rights of any
third party and the Company has not received any charge, complaint, claim or
notice alleging any such infringement or violation. The Company has not copied
in violation of the rights of others any proprietary feature of any competitive
product in designing the Company's products. The Company has not knowingly
misappropriated any trade secrets which are the property of a third party.

                           6.20.4 There are no claims pending or, to the
knowledge of the Company, threatened to the effect that any shareholder,
director, employee or agent of the Company has, in respect of his or her
activities to date, violated any terms or conditions of any written or oral
Contract, or disclosed or utilized any trade secrets or proprietary information
or documentation of such third party, or interfered in the employment
relationship between such third party and any

                                       12
<PAGE>

of its employees and, to the knowledge of the Company, no basis for any such
action exists except where such actions would not constitute a Material Adverse
Effect.

                  6.21     AFFILIATED TRANSACTIONS. Except as set forth on
SCHEDULE 6.21, to the knowledge of the Company, no affiliate of the Company has
any interest (other than as a non-controlling holder of securities of a
publicly-traded company), either directly or indirectly, in any person (whether
as an employee, officer, director, shareholder, agent, independent contractor,
security holder, creditor, consultant or otherwise) that currently (i) provides
any services or designs, produces and/or sells any products or product lines, or
engages in any activity which is the same, similar to or competitive with any
activity or business in which the Company is now engaged; (ii) is a supplier of,
customer of, creditor of, or has an existing contractual relationship with, the
Company; or (iii) has any direct or indirect interest in any asset or property
used by the Company or any property, real or personal, tangible or intangible,
that is necessary or desirable for the conduct of the business of the Company.
All transactions set forth on SCHEDULE 6.21 were negotiated and entered into on
an arms'-length basis

                  6.22     BANK ACCOUNTS. SCHEDULE 6.22 sets forth a complete
and accurate list of each bank or financial institution in which the Company has
an account or safe deposit box (giving the address and account numbers) and the
names of the persons authorized to draw thereon or to have access thereto.

                  6.23     BROKERS' AND FINDERS' FEES. Except as set forth on
SCHEDULE 6.23, the Company has not employed any broker, finder or financial
advisor or incurred any liability for fees or commissions payable to any broker,
finder or financial advisor in connection with the negotiations relating to or
the transactions contemplated by this Agreement.

                  6.24     REGISTRATION RIGHTS. Except as provided in the
Amended and Restated Registration Rights Agreement attached hereto as EXHIBIT B,
the Registration Rights Agreement between the Company, Papalios, Francis
Papalios Trust (as successor to Fran Papalios) and Clark dated May 10, 1996, or
the Supplement to Registration Rights Agreement between the Company and Gary
Qualmann dated July 31, 1996, the Company is presently not under any obligation
and has not granted any rights to register under the Securities Act any of its
outstanding securities or any of its securities that may be subsequently issued.

                  6.25     SMALL BUSINESS CONCERN. The Company acknowledges that
River Cities is a Federal licensee under the Small Business Investment Act of
1958, as amended (the "SBIA"). The Company, together with its "affiliates" (as
that term is defined in Title 13, Code of Federal Regulations, Section 121.103),
is a "small business concern" within the meaning of the SBIA, and the
regulations thereunder, including Title 13, Code of Federal Regulations, Section
121.101 ET SEQ. The information regarding the Company and its affiliates set
forth in the SBA Form 1031 delivered at the Closing is accurate and complete.
The Company does not presently engage in, and it shall not hereafter engage in,
any activities prohibited by the SBIA and the regulations thereunder, nor shall
the Company use, directly or indirectly, the proceeds from the sale of the
Series B Preferred Stock hereunder for any purpose for which a Small Business
Investment Company is prohibited from providing funds by the SBIA and such
regulations thereunder.

                                       13
<PAGE>

                  6.26     MATERIAL FACTS. To the knowledge of the Company, the
Company has provided the Investors with all the information reasonably available
to the Company that the Investors have requested for deciding whether to
purchase the Series B Preferred Stock. This Agreement and the documents or
written statements furnished by the Company to the Investors in connection with
the transactions contemplated hereby do not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements contained herein or therein, in light of the circumstances in which
they are made, not misleading, except, with respect to assumptions, projections
and expressions of opinions or predictions contained in the documents or written
materials furnished by the Company, the Company represents only that such
assumptions, projections and expressions of opinions and predictions were made
in good faith and the Company believes that there is a reasonable basis
therefor.

                  6.27     CLARK DEBT REPAYMENT OBLIGATIONS. All payments due to
date by Clark to Firstar, N.A., in connection with that certain term note issued
to Firstar in the original principal amount of $660,464.20 dated July 28, 1999
(the "Refinancing"), have been paid in full and when due and all payments due to
date by the Company to Clark pursuant to that certain promissory note in the
principal amount of $1,000,000 dated May 10, 1996, have been paid in full and
when due. In connection with the Refinancing, Clark repaid in full that certain
term note issued to Huntington National Bank in the original principal amount of
$800,000.

                  6.28     YEAR 2000 COMPLIANCE. All of the assets and products
of the Company that are material to its business and that contain (i) computer
hardware and/or software, and/or (ii) embedded chips/controllers with date-time
functionality, are or will be prior to January 1, 2000, "Year 2000 Compliant".
"Year 2000 Compliant" means such asset or product is able to provide all of the
following functions: (i) handle date information before, during and after
January 1, 2000, including but not limited to accepting date input, providing
date output, and performing calculations on dates or portions of dates; (ii)
function accurately and without interruption before, during and after January 1,
2000, without any change in operations associated with the advent of the new
century; (iii) respond to two-digit year-date input in a way that resolves the
ambiguity as to century in a disclosed, defined and predetermined manner; and
(iv) store and provide output of date information in ways that are unambiguous
as to century.

         7.      REPRESENTATIONS AND WARRANTIES OF THE INVESTORS. Each Investor
hereby represents and warrants to the Company, as of the date hereof and as of
the Closing Date, as follows:

                  7.1      Authorization; Binding Agreement. This Agreement and
the Amended and Restated Registration Rights Agreement have been duly
authorized, executed and delivered by the Investor and each constitutes the
legal, valid and binding obligation of the Investor enforceable against it in
accordance with its terms; except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and (ii) the availability of equitable remedies may
be limited by equitable principles of general applicability.

                                       14
<PAGE>

                  7.2      INVESTMENT REPRESENTATIONS. The Investor is acquiring
the Series B Preferred Stock and the Common Stock issuable upon conversion
thereof (collectively the "Securities") solely for its own account as principal,
for investment purposes only and not with a view to resale or distribution
thereof in whole or in part, and the Investor has no present intention of
selling, granting any participation in, or otherwise distributing the
Securities. No other person has a direct or indirect beneficial interest in the
Securities to be acquired by the Investor hereunder and the Investor does not
have any contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participation to any third person, with respect to any
of the Securities.

                  7.3      ACCREDITED INVESTOR; RESIDENCE. River Cities is a
resident of the State of Ohio; Bailey is a resident of the State of Florida;
each of the other Investors is a resident of the State of Kentucky. Each of the
Investors is an "accredited investor" as such term is defined under Regulation D
of the Securities Act.

                  7.4      RECEIPT OF INFORMATION; RESTRICTED SECURITIES. The
Investor acknowledges that the Securities are not being and will not be
registered under the Securities Act or the securities laws of any other
jurisdiction in reliance on exemptions thereunder. Accordingly, each certificate
evidencing the Securities shall be imprinted with the legend set forth in
Article FOURTH of the Amended Articles. The Investor acknowledges that the
Securities have not been and will not be approved or disapproved by the
Securities and Exchange Commission or any other governmental authority or agency
of any jurisdiction. The Investor represents that it has had an opportunity to
ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Series B Preferred Stock and the business,
properties, prospects, and financial condition of the Company and to obtain
additional information (to the extent the Company possessed such information or
could acquire it without unreasonable effort or expense) necessary to verify the
accuracy of any information furnished to the Investor or to which the Investor
had access. The Investor's representations under this Section 7, however, shall
not limit or modify the representations and warranties of the Company in Section
6 of this Agreement or the right of the Investor to rely thereon.

                  7.5      INVESTMENT EXPERIENCE. The Investor is experienced in
evaluating and investing in private placement transactions of securities of
companies in a similar stage of development and acknowledges that it can bear
the economic risk of the Investor's investment and has such knowledge and
experience in financial and business matters that the Investor is capable of
evaluating the merits and risks of the investment in the Securities. The
Investor also represents that it has not been organized for the purpose of
acquiring the Series B Preferred Stock.

         8.       SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained in this Agreement by the Company and
the Investors and any certificate or other instrument delivered by or on behalf
of such party pursuant to this Agreement shall survive the Closing and shall
continue so long as the Preferred Holders (as defined in Section 15 hereof),
individually or in the aggregate, hold capital stock of the Company in the form
of Senior Preferred Stock, Series B Preferred Stock, Common Stock or a
combination thereof equal to a

                                       15
<PAGE>

minimum of 1,000 shares (subject to adjustment for stock splits, combinations,
dividends and other similar events occurring on or after the Closing Date) of
Common Stock (a "Minimum Interest"). Each party shall have the right to rely on
each other party's representations and warranties made herein, notwithstanding
any investigation conducted by such party.

         9.       INDEMNIFICATION.

                  9.1      INDEMNIFICATION BY THE COMPANY. The Company shall
indemnify and reimburse an Investor for any and all claims, losses, liabilities,
damages (including, without limitation, fines, penalties, and criminal or civil
judgments and settlements), costs (including, without limitation, court costs)
and expenses (including, without limitation, reasonable attorneys' and
accountants' fees) (hereinafter "Loss" or "Losses") suffered or incurred by the
Investor or any successors or assigns thereto as a result of or with respect to:

                           9.1.1 any breach or inaccuracy of any representation
or warranty of the Company set forth in this Agreement and the Exhibits hereto;

                           9.1.2 any breach of or noncompliance by the Company
with any covenant or agreement of the Company contained in this Agreement; and

                           9.1.3 any and all actions, suits, proceedings,
claims, demands, assessments and judgments incident to any of the foregoing.

                  9.2      INDEMNIFICATION BY CLARK. Clark shall indemnify and
reimburse an Investor for any Loss suffered or incurred by the Investor or any
successors or assigns thereto as a result of or with respect to:

                           9.2.1 any breach or inaccuracy of any representation
or warranty by Clark set forth in the last sentence of Section 6.20.1 and
Section 6.27; and

                           9.2.2 any breach of or noncompliance by Clark with
any covenant or agreement of Clark contained in Section 10.6; and

                           9.2.3 any and all actions, suits, proceedings,
claims, demands, assessments and judgments incident to any of the foregoing.

                  9.3      INDEMNIFICATION BY AN INVESTOR. An Investor shall
indemnify and reimburse the Company and Clark for any and all Losses suffered or
incurred by the Company or Clark or any successors or assigns thereto as a
result of, or with respect to:

                           9.3.1 any breach or inaccuracy of any representation
or warranty of the Investor set forth in this Agreement and the Exhibits hereto;

                           9.3.2 any breach of or noncompliance by the Investor
with any covenant or agreement of the Investor contained in this Agreement; and

                                       16
<PAGE>

                           9.3.3 any and all actions, suits, proceedings,
claims, demands, assessments and judgments incident to any of the foregoing.

         10. CONVENANTS OF THE COMPANY (AND CLARK SOLELY WITH RESPECT TO
SECTION 10.6).

                  10.1      INSURANCE. The Company will use commercially
reasonable efforts to obtain, as soon as practicable after the Closing Date, but
not later than sixty (60) days after the Closing Date, additional term life
insurance on the life of Clark in the face amount of $3,000,000 naming the
Company as loss payee and the Investors as collateral assignee of the proceeds.
The Company shall use commercially reasonable efforts to maintain such insurance
for so long as the Preferred Holders hold a Minimum Interest.

                  10.2      FINANCIAL REPORTING. For periods commencing on or
after the Closing Date, the Company shall deliver or cause to be delivered to
the Investors monthly and year-to-date balance sheets and income and cash flow
statements (each as compared to budget and the comparable prior year period), a
brief monthly written summary of operations and such other information and data
with respect to the Company as the Investors may reasonably request. Such
monthly reports shall be provided on or before 15 days following the end of each
month. Prior to the end of each fiscal year, the Company shall provide a
business plan and projections for the next fiscal year which are similar in
format to those provided by the Company historically. Annual audits of the
Company's financial statements for periods commencing on or after August 1, 1998
shall be performed by Deloitte & Touche or another independent accounting firm
reasonably acceptable to the Investor and copies thereof shall be delivered to
the Investors on or before the 120th day following the end of the Company's
fiscal year.

                  10.3      BOARD OF DIRECTORS.

                           10.3.1 The Restated Regulations of the Company
provide for a Board of Directors of seven members. So long as the Preferred
Holders hold a Minimum Interest and do not possess the rights set forth in
Section 12.2.2 below, Clark and the Investors shall vote their respective
Preferred Stock in a manner intended to cause the following composition of the
Board of Directors: the Investors shall designate one director, Clark and the
other holders of Common Stock shall designate four directors (one of whom must
be Clark), and Clark and the other holders of Common Stock shall designate two
directors (who must be non-employees and not related to an employee) who must be
reasonably acceptable to the Investors. The initial directors are currently
expected to include Clark, Gary Qualmann (an employee director designated by
Clark and the other holders of Common Stock), Neal Ater (a non-employee director
designated by Clark and the other holders of Common Stock and reasonably
acceptable to the Investors), and Murray R. Wilson (designated by and related to
the Investors). The remaining vacancies on the seven member Board of Directors
shall be filled by Clark and the other holders of Common Stock in accordance
with the above requirements as soon as practicable.

                           10.3.2 The Company shall reimburse the director
designated by the Investors for the reasonable travel expenses incurred in
connection with meetings of the Board of

                                       17
<PAGE>

Directors. Pursuant to the Restated Regulations, the Board of Directors shall
also have a Compensation Committee and an Audit Committee, each of which shall
be comprised of three directors. So long as the Preferred Holders hold a Minimum
Interest, Clark and the Investors shall use their best efforts to cause at least
two of the members of each such committee to be non-employee (and not related to
an employee) directors and one of those two shall be designated by the
Investors. The Compensation Committee shall be responsible for initiating all
decisions regarding the compensation of the directors, executive officers and
senior management of the Company, including, but not limited to, all decisions
regarding salary increases, bonus awards, perquisites and stock option awards.
The Audit Committee shall supervise the annual audit of the Company and
undertake such other responsibilities and duties as the Board of Directors of
the Company may from time to time designate.

                  10.4     RESERVATION OF SHARES. So long as any shares of
Preferred Stock are outstanding, the Company shall reserve and keep reserved at
all times sufficient shares of Common Stock for issuance upon conversion of the
Preferred Stock. Upon conversion of any shares of Preferred Stock, the Company
shall promptly issue and deliver the shares of Common Stock required to be
delivered.

                  10.5     USE OF  PROCEEDS.  The proceeds from the sale of the
Series B Preferred  Stock shall be used by the Company for working capital
and/or the payment of indebtedness.

                  10.6     CLARK DEBT REPAYMENT OBLIGATIONS. Clark shall remain
current in her principal and interest payments to Firstar Bank, N.A. pursuant to
the Refinancing, in accordance with that certain term note in the original
principal amount of $660,464.20 dated July 28,1999, as such indebtedness may be
restructured and/or refinanced from time to time.

                  10.7     COMPLIANCE WITH SMALL BUSINESS INVESTMENT ACT. The
Company agrees to provide each Investor with sufficient information to permit
the Investor to comply with its obligations under the SBIA and the regulations
thereunder. Upon reasonable request, the Company shall also provide each
Investor with (i) reasonable access to the Company's properties, places of
business, records (including financial records) and offices during normal
business hours and (ii) the opportunity to discuss the affairs, finances and
accounts of the Company with the officers of the Company. Each Investor and
representatives of the SBA shall be given reasonable access to the Company's
records to confirm that the proceeds received by the Company in connection with
the consummation of the transactions contemplated by this Agreement are used for
the purposes set forth in Section 10.5 hereof. The President of the Company
shall certify to the Investors, within three months of the date of the First
Closing Date and from time to time thereafter, that the Company has used the
proceeds in accordance with the purposes set forth in Section 10.5 hereof.

                  10.8 NEGATIVE COVENANTS. So long as any shares of Preferred
Stock are outstanding, the Company shall not, without the prior written consent
of the holders of a majority of the shares of Preferred Stock then outstanding:

                           10.8.1 sell a material portion of the Company's
assets;

                                       18
<PAGE>

                           10.8.2 merge or sell a controlling interest in the
Company (except in the case of a Qualified Sale (as defined below) and except
that the Company may, without the consent of the holders of the Preferred stock,
merge with another entity if the Company (or its subsidiary) is the surviving
corporation and the consideration paid by the Company (or its subsidiary) for
the merged entity's securities is cash);

                           10.8.3 amend the Amended Articles or the Restated
Regulations in any manner, the consent of the holders of the Preferred Stock to
which shall not be unreasonably withheld;

                           10.8.4 declare dividends or distributions (other than
the minimum tax distributions required by the Shareholders Agreement) to, and/or
redemptions or repurchases of any securities other than the Preferred Stock or
pursuant to buy-sell agreements between the Company and its employees;

                           10.8.5 become a party to, modify, amend or restate
the terms of any agreement which restricts or would restrict the rights of the
Preferred Stock; provided, however, that, without restricting or limiting an
Investor's ability to exercise its remedies pursuant to Section 12.2 or any
other section hereof, the Company may enter into credit agreements that restrict
the Company's ability to pay dividends on or repurchase the Preferred Stock if
such restrictions are required by the lender;

                           10.8.6 make any significant change in the fundamental
nature of the Company's business not contemplated in its existing business plan;

                           10.8.7 create a subsidiary or make an investment in
any entity;

                           10.8.8 enter into transactions with affiliates other
than on an arms'-length basis and on commercially reasonable terms; or

                           10.8.9 issue or sell Common Stock without
consideration.

                  10.9     DEFINITION OF A QUALIFIED SALE. A Qualified Sale is a
sale transaction which yields the Investors at least an amount in cash equal to
the greater of: (i) return of the aggregate purchase price of the Preferred
Stock purchased by the Investors from the Company, plus a compounded annual
return of 20% on such amount or (ii) two times the aggregate purchase price of
the Preferred Stock purchased by the Investors from the Company.

         11.      RESTRICTIONS OF TRANSFERS.

                  11.1     NOTICE OF SALE BY CLARK. In the absence of and until
a Qualified IPO (as defined below), Clark shall give written notice to the
holders of the Preferred Stock and the Company if at any time she desires to
sell or transfer any of her shares ("Notice of Sale"). The Notice of Sale shall
set forth a description of the proposed sale or transfer, including the name of

                                       19
<PAGE>

the proposed purchaser or transferee, the number of shares affected, the
purchase price or consideration and any other conditions of the sale or
transfer. For a period of ten days following receipt of such Notice of Sale, the
Investors shall have the right to prohibit such sale or transfer by Clark. The
holders of a majority of the shares of Preferred Stock then outstanding shall
notify Clark and the Company in writing within ten days of receipt of the Notice
of Sale of their intention to either allow or prohibit the proposed sale or
transfer ("Notice Reply").

                  11.2     DEFINITION OF QUALIFIED IPO. A Qualified IPO is an
initial public offering which yields net proceeds to the Company of at least
$30,000,000 at a price per share indicating a total market equity capitalization
(post-money) of at least $90,000,000.

                  11.3     CO-SALE RIGHT. If the holders of the majority of the
shares of Preferred Stock then outstanding do not prohibit the proposed sale or
transfer of shares by Clark pursuant to Section 11.1, for a period of 30 days
following the receipt by the holders of the Preferred Stock of the Notice of
Sale, each holder of Preferred Stock shall have the right to elect to
participate in such sale or transfer with Clark (on a pro rata basis, I.E., if
Clark owns 75 shares of Common Stock and such holder owns 25 shares of Preferred
Stock, the holder may sell one-fourth of the shares proposed to be sold by
Clark) on the same terms and conditions and for the price or consideration
designated in the Notice of Sale. Notice of the holder's intention to
participate in such sale or transfer shall be evidenced by a writing signed by
the holder and delivered to Clark prior to the end of the 30th day following the
holders' receipt of the Notice of Sale. If the holder fails to notify Clark
within such 30-day period of its intent to participate in such sale, its rights
under this Section 11.3 shall be waived with respect to the proposed sale or
transfer by Clark.

                  11.4     RIGHTS OF REFUSAL. If the holders of a majority of
the shares of Preferred Stock then outstanding do not prohibit the proposed sale
or transfer of shares by Clark pursuant to Section 11.1, for a period of 30 days
following the Company's receipt of the Notice of Sale, the Company shall have
the right to purchase all but not less than all of the shares designated in the
Notice of Sale on the same terms and conditions and for the price or
consideration designated therein (the "First Right of Refusal"). If the Company
does not exercise its First Right of Refusal, then, for a period of 30 days
following the receipt by the holders of the Preferred Stock of notice from the
Company of the Company's decision not to exercise its First Right of Refusal,
the holders of the Preferred Stock shall' have the right to purchase all but not
less than all of the shares from Clark on the same terms and conditions and for
the price or consideration designated in the Notice of Sale (the "Second Right
of Refusal"). At the sole option of the holders of a majority of the shares of
Preferred Stock then outstanding, the Company may be permitted to participate
with the holders of the Preferred Stock in the purchase of the shares pursuant
to the Second Right of Refusal so long as the holders of the Preferred Stock and
the Company together purchase all but not less than all of the shares.

         Notice of the Company's intention to purchase the shares pursuant to
its First Right of Refusal shall be evidenced by a writing signed by the Company
and delivered to Clark prior to the end of the 30th day following the Company's
receipt of the Notice of Sale. Notice of the intention of the holders of the
Preferred Stock to purchase the shares evidenced by their Second

                                       20
<PAGE>

Right of Refusal shall be evidenced by a writing signed by the holders of the
Preferred Stock and delivered to Clark prior to the end of the 30th day
following the later of the holders' receipt of the Notice of Sale or the
holders' receipt of the notice of the Company's decision not to exercise its
First Right of Refusal.

         In the event the holders of the Preferred Stock do not exercise their
Second Right of Refusal, Clark shall have the right to sell or transfer the
shares designated in the Notice of Sale on the same terms and conditions and for
the price or consideration designated therein within 60 days from the expiration
of the period during which the holders had the option to purchase the shares
pursuant to its Second Right of Refusal. After such 60-day period, Clark shall
not transfer Clark's shares again without complying with this Section 11.

                  11.5     EXCEPTIONS. Sections 11.1, 11.3, and 11.4 shall not
apply (a) to any sale or transfer by Clark for estate planning purposes or
to her ancestors, siblings, descendants or spouse, (b) if the Preferred
Holders no longer hold a Minimum Interest, or (c) to sales or transfers of up
to 4,000 shares in the aggregate (subject to adjustment for stock splits,
combinations, dividends and other similar events) to employees of the Company.

                  11.6     RIGHT OF FIRST REFUSAL. In the absence of and until a
Qualified IPO, if a holder of Preferred Stock desires to sell or transfer any of
its Preferred Stock pursuant to a bona fide offer, the holder shall first give
notice (the "Notice of Intent") to the Company. The Notice of Intent shall set
forth the terms of the bona fide offer, including the name(s) of the proposed
transferee(s), the type and number of securities proposed to be transferred and
the price or consideration for the securities proposed to be transferred.

         For a period of 30 days following receipt of such Notice of Intent, the
Company shall have the right to purchase all (but not less than all) of the
Preferred Stock designated in the Notice of Intent on the same terms and
conditions and for the price or consideration designated therein. Notice of the
Company's intention to purchase such Preferred Stock shall be evidenced by a
writing signed by the Company and delivered to the holder prior to the end of
the 30th day following the Company's receipt of the Notice of Intent.

         In the event the Company does not exercise its Right of First Refusal,
the holder shall have the right to sell or transfer the Preferred Stock
designated in the Notice of Intent on the same terms and conditions and for the
price or consideration and to the proposed transferee designated therein within
60 days from the expiration of the period during which the Company had the
option to purchase such Preferred Stock. Notwithstanding the foregoing, the
holder may not transfer any Preferred Stock pursuant to this Section 11.6 to
those persons competitive with the Company which are described on Schedule 11.6
without the consent of the Company. This Section 11.6 shall not apply to any
distribution in kind by a holder to its partners, members or shareholders
pursuant to Section 15.

                  11.7     RIGHT OF FIRST OFFER. In the absence of and until a
Qualified IPO, if a holder of Preferred Stock desires to sell or transfer any of
its Preferred Stock (except pursuant to a bona fide offer received by the holder
in accordance with Section 11.6), the holder shall first

                                       21
<PAGE>

give a Notice of Intent to the Company. The Notice of Intent shall set forth the
number of shares of Preferred Stock which the holder desires to sell.

         For a period of 30 days following receipt of such Notice of Intent, the
Company shall have the right to negotiate a transaction with the holder whereby
the Company will purchase for cash all (but not less than all) of the Preferred
Stock designated in the Notice of Intent at a price and upon other terms and
conditions acceptable to the holder and the Company. Any such purchase shall be
consummated on or prior to the 60th day after the Company's receipt of the
Notice of Intent.

         If (a) the Company elects not to exercise the right provided in this
Section 11.7, (b) the Company and the holder cannot agree on the terms and
conditions of a purchase by the Company during such 30 day period, or (c) the
Company and the holder shall agree on the terms and conditions of such purchase
but the Company shall fail to pay the purchase price in a timely manner, then
the holder may sell the Preferred Stock designated in the Notice of Intent at a
price and on terms not more favorable to the purchaser than the price and terms
offered to the Company. The holder may sell such Preferred Stock during the
period ending on the 150th day following the later of the end of such 30 day
period and the date on which the Company fails to pay such price. If the holder
does not sell such Preferred Stock in such 150 day period, the Preferred Stock
shall again be subject to this Section 11.7. This Section 11.7 shall not apply
to any distribution in kind by the holder to its partners or shareholders
pursuant to Section 15. Notwithstanding the foregoing, the holder may not
transfer any Preferred Stock pursuant to this Section 11.7 to those persons
competitive with the Company which are described on SCHEDULE 11.6 without the
consent of the Company.

                  11.8     RESTRICTIVE LEGEND. The share certificates evidencing
the shares subject to the foregoing provisions of this Section 11 shall bear
appropriate legends referring to the restrictions on transfer.

                  11.9     PREEMPTIVE RIGHTS. In the absence of and until a
Qualified IPO, each holder of Preferred Stock shall have the right of first
refusal to purchase all or part of its pro rata share (equal to its percentage
ownership of the Company on a fully diluted basis) of New Preferred Stock (as
defined below) that the Company may, from time to time, propose to sell and
issue, subject to the terms and conditions set forth below. "New Securities"
shall mean any capital stock of the Company whether now authorized or not, and
rights, options, or warrants to purchase capital stock, and securities of any
type whatsoever that are, or may become, convertible into capital stock,
provided, however, that the term "New Securities" does not include (i) the
Series B Preferred Stock issuable under this Agreement or the shares of Company
Stock issuable upon conversion of the Series B Preferred Stock or the Senior
Preferred Stock; (ii) securities issued pursuant to an acquisition; (iii)
options granted or securities issued pursuant to an employee or director stock
option program; or (iv) securities issued as a result of any stock split, stock
dividend, or reclassification of Common Stock, distributable on a pro rata basis
to all holders of Common Stock. In the event the Company intends to issue New
Securities, it shall give written notice to the holders of Preferred Stock
("Notice of Issuance") which shall set forth the purchase price and any other
conditions of the issuance. Each holder of Preferred Stock shall

                                       22
<PAGE>

have 30 days from the date of Notice of Issuance to agree to purchase all or
part of its pro rata share of such New Securities for the price and upon the
general terms and conditions specified in the Notice of Issuance by giving
written notice to the Company stating the quantity of New Securities to be so
purchased.

         The Company shall have the right during the period expiring 150 days
after the giving of the Notice of Issuance to sell any or all of such New
Securities not purchased by the holders of Preferred Stock at a price and upon
general terms no more favorable to the purchasers than specified in the Notice
of Issuance. In the event that the Company has not sold such New Securities
within such 150 day period, the Company shall not thereafter issue or sell any
New Securities without first offering such New Securities to the holders of
Preferred Stock in the manner provided in this Section 11.9.

         12.      DEFAULT.

                  12.1     EVENTS OF DEFAULT. The occurrence of any of the
following events shall constitute an "Event of Default":

                  12.1.1   a material breach of any representation, warranty or
covenant of the Company or Clark contained herein or in the exhibits hereto
or in the Senior Preferred Stock purchase Agreement or the exhibits thereto;

                  12.1.2   any default in the performance by the Company or
Clark of any other material term of this Agreement or of the Senior Preferred
Stock Purchase Agreement or a declared event of default under any loan
agreement or financing agreement to which the Company is a party (following
any applicable cure period contained in such loan agreement or financing
agreement);

                  12.1.3   the adjudication of the insolvency of the Company or
the filing by or against the Company of any proceedings in bankruptcy,
reorganization or receivership (unless such proceedings are stayed or
dismissed), any assignment by the Company for the benefit of creditors or the
exercise of control rights by any secured lender of the Company; or

                  12.1.4   the failure of the Company to redeem or repurchase
the Preferred Stock or converted shares in accordance with the terms of this
Agreement, the Senior Preferred Stock Purchase Agreement and the Amended
Articles.

                  12.2 REMEDY. Upon the occurrence of any Event of Default,
the holders of a majority of the Preferred Stock then outstanding may, at
their option, elect either of the following rights and remedies:

                  12.2.1   require the Company to redeem all but not less than
all of the Preferred Stock (including repurchase of conversion stock) at a
price equal to the greater of (i) the aggregate original issue price of the
Preferred Stock plus any accrued and unpaid dividends or (ii) the Fair Market
Value (as defined below) thereof, including any accrued and unpaid dividends;
or

                  12.2.2   as authorized by the Amended Articles, the holders
of a majority of the Preferred Stock then outstanding shall have the right to
elect a majority of the Board of Directors of the Company and to vote two
thirds (2/3) of the combined voting power within the Company until the Event
of Default is cured, and such majority of the Board of Directors may vote to
require the Company to redeem the Preferred Stock in accordance with Section
12.2.1 above.

                  The "Fair Market Value" per share shall take into account
the liquidation preference of the Preferred Stock provided in the Amended
Articles but not any discount for lack of marketability or for the minority
interest and shall be determined by a qualified, independent appraiser
experienced in valuation of shares of companies similar to the Company (the
"Qualified Appraiser") acceptable to both the Company (with the decision of
the Company being exercised by a majority of the directors who were not
designated by the holders of the Preferred Stock) and the holders of a
majority of the Preferred Stock then outstanding. If the holders of a
majority of the Preferred Stock then outstanding and the Company are unable
to agree upon a Qualified Appraiser, each of them shall separately designate
a person and those two persons shall jointly designate a Qualified Appraiser.
The Qualified Appraiser's determination of the Fair Market Value of the
Preferred Stock shall be conclusive and binding upon the parties. The fees
and expenses of the Qualified Appraiser shall be borne one-half by the
holders of the Preferred Stock and one-half by the Company.

                  12.3     DIVERSION OF PROCEEDS. In addition, any diversion by
the Company of the proceeds hereunder from the Use of Proceeds as set forth in
Section 10.5 hereof shall constitute a default requiring the immediate
redemption of the Investor's interest in the Company and full refund of the
purchase price, plus interest at 14% per annum.

                  12.4     LOSS OF CLARK. In addition, so long as the holders of
the Preferred Stock hold a Minimum Interest, in the event of the death,
permanent disability or termination of full time employment of Clark, except for
a termination by the Company other than for "cause" or a termination by Clark
for "good reason" (as those terms are defined in the Employment Agreement
between Clark and the Company), upon six months written notice to the Company,
the holders of a majority of the Preferred Stock then outstanding may require
the Company to redeem all but not less than all of the Preferred Stock
(including the conversion stock) for the higher of (i) aggregate original issue
price of the Preferred Stock plus any accrued and unpaid dividends or (ii) Fair
Market Value of the Preferred Stock, as determined in accordance with Section
12.2. Permanent disability shall occur whenever Clark, due to ill health,
physical or mental disability for a period of 180 consecutive working days, is
unable or otherwise fails to perform the essential functions of her job. If the
holders of a majority of the Preferred Stock then outstanding and the Company
are unable to agree as to whether Clark is permanently disabled, the question of
permanent disability shall be submitted to three physicians, one of whom shall
be appointed by the holders of a majority of the Preferred Stock then
outstanding, one of whom shall be appointed by Clark's representative and one of
whom shall be appointed by the first two appointed physicians. The decision of
any two of the three physicians shall be final and binding. If the question of
permanent disability is raised, Clark shall submit to a medical examination by
such physicians and the holders of the Preferred Stock shall have access to the
findings of the physicians. This Section 12.4 shall be of no force or effect for
such time as the Company employs a Chief Operating Officer (other than Clark)
who is reasonably acceptable to the holders

                                       23
<PAGE>

of a majority of the Preferred Stock then outstanding, or if a Chief Operating
Officer has been appointed but is no longer employed by the Company, for such
time as the Company is actively seeking such a Chief Operating Officer.
Notwithstanding the foregoing, this Section 12.4 shall terminate and be of no
further force and effect as of August 27, 2000.

         13.      PUBLIC STATEMENTS. Neither the Company, Clark nor the
Investors shall, without the prior written approval of the other parties hereto,
make any press release or other public announcement concerning the transactions
contemplated by this Agreement, provided, however, that an Investor may issue a
"tombstone" advertisement stating the amount of its investment in the Company.
Each Investor, the Company and Clark may disclose additional information with
respect to the transactions contemplated hereby to their respective employees,
agents, consultants and third parties only to the extent such persons have a
need to know such information.

         14.      NOTICES. All notices, requests, consents, and other
communications under this Agreement shall be in writing and shall be mailed by
first class, registered, or certified mail, postage prepaid, or sent via
overnight courier service, or delivered personally:

       If to River Cities, to:  River Cities Capital Fund II Limited Partnership
                                ATTN: Murray R. Wilson
                                221 East Fourth Street, Suite 1900
                                Cincinnati, Ohio 45202-4147

       With a copy to:          Graydon, Head & Ritchey
                                ATTN:  Michael A.  Hirschfeld, Esq.
                                1900 Fifth Third Center
                                511 Walnut Street
                                Cincinnati, Ohio 45202-3157

       If to JG, to:            JG Funding, LLC
                                ATTN: David Jones, Jr.
                                1850 National City Tower
                                101 South Fifth Street
                                Louisville, Kentucky 40202

       If to Saunders, to:      Saunders Capital Group, LLC
                                ATTN: Robert S. Saunders
                                1850 National City Tower
                                101 South Fifth Street
                                Louisville, Kentucky 40202

       If to Bailey, to:        Irving W.  Bailey II
                                c/o Bailey Capital Corporation
                                205 Worth Avenue, Suite 201
                                Palm Beach, Florida 33480

                                       24
<PAGE>

       If to the Company or
       Clark, to:               DPEC, Inc.
                                ATTN:  Carol A. Clark
                                Building 3
                                851 West Third Avenue
                                Columbus, Ohio 43212

       With a copy to:          Vorys, Sater, Seymour and Pease LLP
                                ATTN: Michael A. Cline, Esq.
                                52 East Gay Street
                                Columbus, Ohio 43215

or to such other address of which the addressee shall have notified the sender
in writing. Notices mailed in accordance with this section shall be deemed given
when mailed, and notices sent by overnight courier service shall be deemed given
when placed in the hands of a representative of such service.

         15.      PARTIES IN INTEREST; ASSIGNMENT. Except as otherwise provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties to this Agreement shall bind and inure to the benefit of
their respective heirs, executors, successors, and permitted assigns, whether so
expressed or not. Nothing in this Agreement, express or implied, is intended to
confer upon any party other than the parties hereto and their respective
successors and permitted assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement. This Agreement and the rights
and obligations under this Agreement are not assignable and any purported
assignment shall be null and void, provided that, subject to the provisions of
Sections 11.6 and 11.7, prior to the termination of an Investor's fund and the
resulting distribution in kind by the Investor to its partners, members or
shareholders, an Investor may assign its rights and obligations under this
Agreement to an affiliate and/or a maximum of two unrelated assignees, and, upon
the termination of an Investor's fund and the resulting distribution in kind by
the Investor to its partners, members or shareholders, the Investor may assign
its rights and obligations under this Agreement to any and all of its partners,
members or shareholders (all of such permitted assignees being collectively
referred to as the "Preferred Holders"). Notwithstanding such permitted
assignment, the Investor shall not be released from its obligations hereunder.

         16.      CONSTRUCTION; GOVERNING LAW. The section headings contained in
this Agreement are inserted as a matter of convenience and shall not affect in
any way the construction of the terms of this Agreement. This Agreement shall be
governed by and interpreted in accordance with the laws of the State of Ohio as
applied to agreements entered into and performed entirely within Ohio. The
parties agree that any actions brought in connection with this Agreement or the
transactions contemplated hereby shall be filed and heard in Hamilton County,
Ohio, and each party submits to the jurisdiction of the Court of Common Pleas of
Hamilton County, Ohio, and to the United States District Court for the Southern
District of Ohio.

                                       25
<PAGE>

         17.      ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Agreement,
including the Schedules and Exhibits hereto, constitutes and contains the entire
agreement between the parties hereto with respect to the transactions
contemplated hereby and supersedes any prior writing by the parties. Any term of
this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company,
Clark and the holders of a majority of the shares of the Preferred Stock then
outstanding). Any amendment or waiver effected in accordance with this paragraph
shall be binding upon the Investors, each other holder of any Preferred Stock
purchased under this Agreement at the time outstanding (including Common Stock
into which such Preferred Stock have been converted), each future holder of any
such Preferred Stock, Clark and the Company.

         18.      SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability
of the remaining provisions.

         19.      COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same agreement.

         20.      EXPENSES. The Company agrees, upon consummation of the
transactions contemplated by this Agreement, to pay, against receipt of the
documentation therefor in reasonable detail, up to $22,500 of the reasonable
legal and out-of-pocket expenses incurred by the Investors in connection with
this Agreement and the transactions contemplated hereunder, including, without
limitation, all fees and expenses of legal counsel, accountants and other
advisers engaged by the Investors in connection with this Agreement and the
transactions contemplated hereunder.

         21.      TIME OF ESSENCE. Time is of the essence to the performance of
the obligations set forth in this Agreement.

         22.      CONFIDENTIALITY AGREEMENT. At the request of the Company, an
Investor and any subsequent holder of Preferred Stock or the conversion stock
shall execute and deliver to the Company a confidentiality letter in a form
reasonably acceptable to the Investor.

         23.      ATTORNEYS' FEES. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the Amended and
Restated Registration Rights Agreement, any Ancillary Agreement or the Amended
Articles, the prevailing party shall be entitled to reasonable attorneys' fees,
costs, and disbursements in addition to any other relief to which such party may
be entitled.

         24.      RIGHTS OF THE INVESTORS. The holders of a majority of the
shares of Preferred Stock then outstanding shall have the absolute right to
exercise or refrain from exercising any rights that the Investors may have by
reason of this Agreement, including without limitation the right to consent to
the waiver of any obligation of Company under this Agreement and to enter into
an agreement with Company for the purpose of modifying this Agreement or any
agreement

                                       26
<PAGE>

effecting any such modification, and shall not incur any liability to
any other holder or holders of Preferred Stock with respect to exercising or
refraining from exercising any such rights and all other holders of Preferred
Stock shall be bound by such exercising or refraining from exercising any such
rights.

         25.      TERMINATION UPON A QUALIFIED IPO. Notwithstanding anything to
the contrary contained in this Agreement, this Agreement shall terminate upon
the closing of a Qualified IPO.

         26.      TERMINATION OF CERTAIN PROVISIONS. Sections 4, 10, 11 and 12
of the Senior Preferred Stock Purchase Agreement are hereby terminated and shall
be of no further force and effect.

         27.      PRONOUNS. Use of male, female and neuter pronouns in the
singular or plural in this Agreement shall be understood to include each of the
other pronouns as the context requires.

         IN WITNESS WHEREOF, the Company, Clark and the Investors have caused
this Agreement to be executed as of the day and year first above written.

                               INVESTORS

                               RIVER CITIES CAPITAL FUND II
                               LIMITED PARTNERSHIP

                               By:   /s/ Edwin T. Robinson
                                     -------------------------------------------
                                     Edwin T.  Robinson, President of Mayson,
                                     Inc., the General Partner of River Cities
                                     Fund II Limited Partnership

                               Address:       Suite 2250
                                              221 East Fourth Street
                                              Cincinnati, Ohio  45202-4 147

                                       27
<PAGE>

                               JG FUNDING, LLC

                               By:  /s/ David Jones, Jr.
                                    --------------------------------------------
                                     David Jones, Jr., Manager of Chrysalis
                                     Ventures, LLC, the Manager of JG Funding,
                                     LLC

                               Address:       1850 National City Tower
                                              101 South Fifth Street
                                              Louisville, Kentucky 40202

                               SAUNDERS CAPITAL GROUP, LLC

                               By:  /s/ Robert S. Saunders
                                    --------------------------------------------
                                       Robert S.  Saunders, Manager

                               Address:       1850 National City Tower
                                              101 South Fifth Street
                                              Louisville, Kentucky 40202

                                    /s/ Irving W. Bailey
                                    --------------------------------------------
                                    Irving W. Bailey II

                               Address:     c/o Bailey Capital Corporation
                                            205 Worth Avenue, Suite 201
                                            Palm Beach, Florida  33480

                               COMPANY

                               DPEC, INC.

                               By:  /s/ Carol A. Clark
                                    --------------------------------------------
                                   Carol A. Clark, President

                               Address:     851 West Third Avenue
                                            Building 3
                                            Columbus, Ohio  43212

                                       28
<PAGE>

                               CLARK

                               By:   /s/ Carol A. Clark
                                    --------------------------------------------
                                    Carol A. Clark

                               Address:     851 West Third Avenue
                                            Building 3
                                            Columbus, Ohio  43212

                                       29<PAGE>

                                                                    EXHIBIT 10.8

            SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

         This Second Amended and Restated Registration Rights Agreement (this
"Agreement") is made as of January __, 2000 (the "Effective Date"), by and among
DPEC, INC., an Ohio corporation (the "Company"), and RIVER CITIES CAPITAL FUND
II LIMITED PARTNERSHIP, a Delaware limited partnership ("River Cities"), JG
FUNDING, LLC, a Kentucky limited liability company ("JG"), SAUNDERS CAPITAL
GROUP, LLC, a Kentucky limited liability company ("Saunders"), and IRVING W.
BAILEY II, an individual ("Bailey") (River Cities, JG, Saunders and Bailey are
hereinafter sometimes referred to individually as an "Investor" and collectively
as the "Investors").

                              W I T N E S S E T H:

         WHEREAS, the Company has issued to one or more of the Investors shares
of Series C Convertible Preferred Stock, no par value per share of the Company
(the "Series C Preferred Stock"), shares of Series B Convertible Preferred
Stock, no par value per share of the Company (the "Series B Preferred Stock"),
shares of Senior Convertible Preferred Stock, no par value of the Company (the
"Senior Convertible Preferred Stock") (the Senior Convertible Preferred Stock,
Series B Preferred Stock and Series C Convertible Preferred Stock are
hereinafter sometimes referred to, collectively, as the "Preferred Stock") and a
warrant to acquire shares of Common Stock, no par value of the Company (the
"Warrant");

         WHEREAS, the parties to this Agreement also are parties to that certain
Series C Convertible Preferred Stock Purchase Agreement (the "Purchase
Agreement") of even date herewith pursuant to which the Company issued the
Series C Preferred Stock and the Warrant;

         WHEREAS, the Company and the Investors are parties to that certain
Amended and Restated Registration Rights Agreement dated August 27, 1999 (the
"Prior Registration Rights Agreement"); and

         WHEREAS, the Company and the Investors desire by this Agreement to
amend and restate the Prior Registration Rights Agreement for the purpose of
adding to the definition of "Registrable Securities" the Series C Preferred
Stock, the Warrant, the Common Stock issuable upon the conversion of the Series
C Preferred Stock and the Common Stock issuable upon exercise of the Warrant;

         NOW, THEREFORE, in consideration of the recitals, the mutual covenants
and agreements herein contained and the issuance and purchase of the Preferred
Stock and the Warrant, the parties hereto, intending to be legally bound, do
hereby covenant and agree as follows:

<PAGE>

         1.       REGISTRATION OF SECURITIES.

                  1.1      REGISTRATION BY THE COMPANY. If at any time or from
time to time the Company proposes to file on its behalf a registration
statement under the Securities Act of 1933, as amended (the "Securities
Act"), with respect to its Common Stock, other than a registration that has
been initiated at the request of the holders of Registrable Securities (as
defined below) pursuant to Section 1.2 or that has been initiated at the
request of the holders of securities (other than Registrable Securities) of
the Company who have been granted registration rights by the Company which
are similar to the rights set forth in Section 1.2, the Company shall in each
case give written notice at least thirty (30) days before the anticipated
filing date to the Investors and each other holder of shares of Preferred
Stock or of shares of Common Stock previously acquired by the conversion of
Preferred Stock or the exercise of the Warrant ("Registrable Securities").
The notice shall offer to include in the filing, subject to reduction as
provided below, the number of Registrable Securities held by such holder. If
a holder desires to have any of its Registrable Securities registered under
this Section 1.1, it shall advise the Company in writing within ten (10) days
after receiving the Company's notice, setting forth the number of Registrable
Securities for which registration is requested. In connection with any
registration of any of the Registrable Securities pursuant to this Section
1.1, the Company shall pay all expenses of the registration and the related
offering, including, without limitation, any and all special audits, legal
and accounting fees and disbursements (including reasonable fees and
disbursements of one legal counsel designated to represent all holders of
Registrable Securities and selected by the holders of a majority of the
Registrable Securities being registered), blue sky fees and expenses,
printing costs and related disbursements arising out of the preparation,
filing, amending and supplementing of the registration statement, but not
including brokers' and underwriters' discounts and commissions which shall be
paid by the holders of the Registrable Securities being registered. Neither
the delivery of the notice by the Company nor the request by the holders of
Registrable Securities shall in any way obligate the Company to file a
registration statement and, notwithstanding such filing, the Company may, at
any time prior to the effective date thereof, determine not to offer the
securities to which the registration statement relates without liability to
any holder of Registrable Securities. No registration of any of the
Registrable Securities effected under this Section 1.1 shall relieve the
Company of its obligation to effect registration of any of the Registrable
Securities upon the request of a holder pursuant to the provisions of Section
1.2 below.

         If the managing underwriter of an underwritten registration under this
Section 1.1 gives the Company its written opinion that the total number of
securities proposed or requested to be included in the registration exceeds the
number of securities that can be sold without adversely affecting the marketing
of the securities, the Company shall be entitled to limit the number of
securities to be included in the registration and shall include the securities
in the registration in the following order of priority: first, all securities
the Company proposes to sell; second, to the extent of any balance, up to the
full number of securities requested to be included in the registration by the
holders of Registrable Securities and by other holders of the Company's
securities who have been granted registration rights by the Company (allocated
pro rata among each such holder on the basis of the

                                       2
<PAGE>

number of such securities owned by all such holders); and third, to the
extent of any balance but only if permitted by the Company, up to the full
number of any other securities requested to be included by other holders of
securities (allocated among such holders in such proportions as the Company
and such holders may agree). In the event that the managing underwriter
advises the Company that an underwriters' overallotment option is necessary
or advisable, the preceding priority shall apply to the determination of
which securities are to be included in the primary portion of such
registration and, if necessary, the overallotment portion of such
registration.

                  1.2      REGISTRATION AT THE HOLDERS' REQUEST. At any time
after the earlier of (i) an initial public offering of the Common Stock or
(ii) September 14, 2003, the holders of a majority of the Registrable
Securities may request in writing that the Company effect the registration
under the Securities Act of any of the holders' shares of Registrable
Securities. The request shall specify the intended method or methods of
disposition of such Registrable Securities (including, if the proposed
offering is to be an underwritten offering, the managing underwriter or
underwriters thereof which underwriter shall be acceptable to the Company).
Upon receiving the request of the holders of the Registrable Securities, the
Company shall promptly notify any other holders of Registrable Securities of
the request and shall permit such holders to request that their Registrable
Securities also be included in such registration. If such a holder desires to
have any of its Registrable Securities registered under this Section 1.2, it
shall advise the Company in writing within ten (10) days after receiving the
Company's notice, setting forth the number of Registrable Securities for
which registration is requested. Thereafter, the Company shall expeditiously
prepare and file a registration statement with respect to, and use its best
efforts to effect the registration under the Securities Act of, the
Registrable Securities specified in the holders' request; provided, however,
that, (i) in the case of any registration pursuant to this Section 1.2 which
is an underwritten offering, the Company shall have the right to postpone
such registration for up to sixty (60) days on the advice of the managing
underwriter thereof; and (ii) no more than two registrations pursuant to this
Section 1.2 will be effected by the Company.

         If at any time the holders of a majority of the Registrable Securities
request registration of any of their Registrable Securities pursuant to this
Section 1.2, the Company shall have the option, exercisable within ten (10) days
of the date of the holders' request, to purchase the Registrable Securities
requested to be registered at the average closing sale price of the Common
Stock, as reported on the applicable exchange or other market on which the
Common Stock is traded or quoted, during the period from the date of the request
through the date the Company exercises its option to purchase; provided,
however, that if the Common Stock is not traded or quoted on an exchange or
other market, the purchase price shall be the fair market value of the
Registrable Securities as determined in accordance with the provisions of
paragraph (B)(5) of Article FOURTH of the Company's Articles of Incorporation,
as amended. The Company shall pay to such holders the purchase price for the
Registrable Securities and the holders shall tender to the Company
certificate(s) representing the Registrable Securities sold, within sixty (60)
days of the exercise of the option.

                                       3
<PAGE>

         Any registration of Registrable Securities requested by the holders
pursuant to the provisions of this Section 1.2 which, for any reason (other than
by reason of the fault of the Company) shall not become effective within ninety
(90) days after its filing with the Commission, may be terminated by the
Company. Any such registration which is so terminated by the Company shall,
nonetheless, be deemed to be a registration under this Section.

         In connection with the registration of the Registrable Securities
pursuant to this Section 1.2, the Company shall pay all expenses of such
registration and the related offering, including, without limitation, any and
all special audits, legal and accounting fees and disbursements (including fees
and disbursements of legal counsel designated to represent all holders of the
Registrable Securities and selected by the holders of a majority of the
Registrable Securities being registered), blue sky fees and expenses, printing
costs and related disbursements arising out of the preparation, filing, amending
and supplementing of the registration statement, except for broker's and
underwriter's discounts and commissions which shall be paid by the holders of
the Registrable Securities being registered.

         If the managing underwriter of an underwritten registration under this
Section 1.2 gives the Company its written opinion that the total number of
securities proposed or requested to be included in the registration exceeds the
number of securities that can be sold without adversely affecting the marketing
of the securities, the Company shall be entitled to limit the number of
securities to be included in the registration and shall include the securities
in the registration in the following order of priority: first, all Registrable
Securities requested to be included in the registration by the holders thereof;
second, to the extent of any balance, up to the full number of securities the
Company proposes to sell; third, to the extent of any balance, up to the full
number of other securities requested to be included in the registration by the
holders of the Company's securities who have been granted registration rights by
the Company (allocated pro rata among each such holder on the basis of the
number of such securities owned by all such holders); and fourth, to the extent
of any balance but only if permitted by the Company, up to the full number of
any other securities requested to be included by other holders of securities
(allocated among such holders in such proportions as the Company and such
holders may agree). In the event that the managing underwriter advises the
Company that an underwriters' overallotment option is necessary or advisable,
the preceding priority shall apply to the determination of which securities are
to be included in the primary portion of such registration and, if necessary,
the overallotment portion of such registration.

         Anything in this Section 1.2 to the contrary notwithstanding, if the
Registrable Securities are included in any registration of any securities for
sale by or on behalf of the Company, such registration shall not be deemed to be
a registration for the purpose of this Section 1.2 but shall be deemed to be a
registration pursuant to the provisions of Section 1.1 hereof; provided,
however, that this paragraph shall not entitle the holders of Registrable
Securities to more than two registrations pursuant to Section 1.2.

                                       4
<PAGE>

                  1.3      REGISTRATION GENERALLY. If and when the Company shall
be required by the provisions of this Section 1 to effect the registration of
Registrable Securities under the Securities Act, the Company shall, as
expeditiously as possible:

                           1.3.1    prepare and file a registration statement
under the Securities Act on Form S-1, S-2 or S-3 (or on any other form for
the general registration of securities) with respect to the Registrable
Securities being registered, and use its best efforts to cause the
registration statement to become effective; provided, however, that before
filing the registration statement and any amendment or supplement thereto,
the Company shall furnish to the holders of the Registrable Securities being
registered or, if requested by such holders, to counsel selected by such
holders, copies of all documents proposed to be filed, which documents shall
be subject to the review and approval of such counsel, which approval shall
not be unreasonably withheld or delayed;

                           1.3.2    prepare and file with the Securities and
Exchange Commission (the "Commission") such amendments and supplements to the
registration statement and the prospectus used in connection therewith as may
be necessary to keep the registration statement effective for a period of one
hundred eighty (180) days from the effective date of the applicable
registration statement or such shorter period agreed upon by the Company and
the holders of a majority of the Registrable Securities being registered, and
to comply with the provisions of the Securities Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), with respect to the
offer of the Registrable Securities covered by the registration statement
during the period required for distribution of the Registrable Securities;

                           1.3.3    furnish to the holders of Registrable
Securities being registered such number of printed copies of the registration
statement and of each amendment and supplement thereto, the prospectus
included in the registration statement (including each preliminary prospectus
and any summary prospectus), the documents incorporated by reference in the
registration statement or prospectus and any other documents as such holders
may reasonably request in order to facilitate the disposition of the
Registrable Securities covered by the registration statement, in conformity
with the requirements of the Securities Act;

                           1.3.4    use its best efforts to register or qualify
the Registrable Securities covered by the registration statement under the
securities or blue sky laws in such jurisdictions within the United States as
the holders may reasonably request; provided however, that the Company shall
not be obligated to qualify its business in any jurisdiction where it is not
then so qualified or otherwise required to be so qualified or to take any
action which would subject it to the service of process in suits other than
those arising out of such registrations;

                           1.3.5    furnish to the holders of the Registrable
Securities being registered and, in the case of any registration pursuant to
Section 1.2 which is an underwritten offering, to the managing underwriter
thereof, a signed counterpart of customary closing documents including (A) an
opinion of counsel for the Company, dated the effective date of the
registration statement (or, in the case of any underwritten offering, the
date of closing with the underwriters) and (B) a so-called

                                       5
<PAGE>

"cold comfort" letter signed by the independent public accountants who have
certified the Company's financial statements included in the registration
statement, covering substantially the same matters with respect to the
registration statement (and the prospectus included therein) and, in the case
of such accountants' letter, with respect to events subsequent to the date of
such financial statements, as are customarily covered in accountants' letters
delivered to underwriters in connection with underwritten public offerings of
securities;

                           1.3.6    immediately notify the holders of the
Registrable Securities being registered at any time when a prospectus
relating to the registration of the Registrable Securities is required to be
delivered under the Securities Act (except where circumstances requiring such
deliveries are within the knowledge or control of the holders) of the
happening of any event as a result of which the prospectus included in the
registration statement, as then in effect, includes an untrue statement of a
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and at the request of any holder prepare and furnish to the holder
a reasonable number of copies of a supplement to or an amendment of the
prospectus as may be necessary so that, as thereafter delivered to the
purchasers of the Registrable Securities, such prospectus shall not include
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing;

                           1.3.7    otherwise use its best efforts to comply
with the Securities Act, Exchange Act and all applicable rules and
regulations of the Commission, and make available to its securities holders,
as soon as reasonably practicable, an earnings statement covering a period of
at least twelve (12) months, but not more than eighteen (18) months,
beginning with the first month of the first fiscal quarter after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act; and

                           1.3.8    use its best efforts to list the Registrable
Securities being registered on the securities exchange or securities association
on which the Common Stock is then listed, and to provide, if appropriate, a
transfer agent and registrar for the Registrable Securities not later than the
effective date of such registration statement.

         If requested by the underwriters of any underwritten offering of the
Registrable Securities, the Company and the holders of the Registrable
Securities being registered shall enter into an underwriting agreement with the
underwriters of the offering, such agreement to contain such representations and
warranties by the Company and such holders and such other terms and provisions
as are customarily contained in underwriting agreements with respect to
secondary distributions, including, without limitation, indemnities to the
effect and to the extent provided in Section 1.5 hereof. If the Company at any
time proposes to register any of its securities under the Securities Act, other
than pursuant to a request made under Section 1.2 hereof, whether or not for
sale for its own account, and such securities are to be distributed by or
through one or more underwriters, the Company shall make reasonable efforts to
arrange for the underwriters to include the Registrable Securities among those
securities to be distributed by or through the underwriters.

                                       6
<PAGE>

         If an underwritten registration of the Company has been initiated at
the request of the holders of securities (other than Registrable Securities) of
the Company who have been granted registration rights by the Company which are
similar to the rights set forth in Section 1.2 and if the managing underwriter
gives the Company its written opinion that the total number of securities
proposed or requested to be included in the registration exceeds the number of
securities that can be sold without adversely affecting the marketing of the
securities, the Company shall be entitled to limit the number of securities to
be included in the registration and shall include the securities in the
registration in the following order of priority: first, up to the sum of the
full number of securities requested to be included in the registration by the
holders who have requested the registration and the number of Registrable
Securities requested to be included in the registration by the holders thereof
(allocated pro rata among each such holder on the basis of the number of
securities owned by all such holders); second, to the extent of any balance, up
to the full number of securities the Company proposes to sell; and third, to the
extent of any balance but only if permitted by the Company, up to the full
number of any other securities requested to be included by other holders of
securities (allocated among such holders in such proportions as the Company and
such holder may agree). In the event that the managing underwriter advises the
Company that an underwriter's overallotment option is necessary or advisable,
the preceding priority shall apply to the determination of which securities are
to be included in the primary portion of such registration and, if necessary,
the overallotment portion of such registration.

         In connection with the preparation and filing of each registration
statement registering Registrable Securities under the Securities Act, the
Company shall give the holders of the Registrable Securities being registered
and their underwriter, if any, and their counsel and accountants the opportunity
to participate in the preparation of such registration statement, each
prospectus included therein or filed with the Commission, and each amendment
thereof or supplement thereto. The Company shall also give each of them such
access to its books and records and such opportunities to discuss the business
of the Company with its officers, its counsel and the independent public
accountants who have certified its financial statements as shall be necessary,
in the opinion of the holders of a majority of the Registrable Securities being
registered and the underwriter or counsel for such holders, to conduct a
reasonable investigation within the meaning of the Securities Act prior to the
effectiveness of the registration statement.

                  1.4      CONDITIONS TO REGISTRATION. The right of the holders
to have Registrable Securities included in any registration statement filed
by the Company in accordance with the provisions of this Section 1 shall be
subject to the following conditions:

                           1.4.1    the holders shall furnish the Company in a
timely manner with all information required by the applicable rules and
regulations of the Commission concerning the proposed method of sale or other
disposition of the Registrable Securities, the identity of and compensation
to be paid to any proposed underwriters to be employed in connection
therewith, and such other information as may be reasonably required by the
Company to prepare and file such registration statement in accordance with
applicable provisions of the Securities Act;

                                       7
<PAGE>

                           1.4.2    if the holders desire to sell and distribute
the Registrable Securities over a period of time, or from time to time, at
then prevailing market prices, then the holders shall execute and deliver to
the Company such written undertakings as the Company and its counsel may
reasonably require in order to assure full compliance with relevant
provisions of the Securities Act and the Exchange Act;

                           1.4.3    in the case of any underwritten offering on
behalf of the holders of Registrable Securities pursuant to the provisions of
Section 1.2 hereof, the managing underwriters shall be subject to the
approval of the Company, such approval not to be unreasonably withheld or
delayed; and

                           1.4.4    in the case of a filing involving Common
Stock which has not yet been acquired by the conversion of Preferred Stock,
the holder shall complete the conversion of its Preferred Stock into such
Common Stock by the effective date of the registration statement.

                  1.5      INDEMNIFICATION. In the event of the registration of
any of the Registrable Securities under the Securities Act pursuant to the
provisions hereof, the Company shall, to the extent permitted by law,
indemnify and hold harmless the holders of such Registrable Securities, their
respective partners, directors, officers, agents, and any underwriters, and
each other person, if any, who controls or is controlled by such holders or
any such underwriters within the meaning of the Securities Act (each such
person being hereinafter sometimes referred to as an "indemnified person"),
against any losses, claims, damages or liabilities, joint or several
(collectively, the "Losses"), to which such indemnified person may become
subject under the Securities Act or otherwise, insofar as such Losses (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained or
incorporated by reference in the registration statement, any preliminary
prospectus or final prospectus contained therein (as they may be amended or
supplemented), or any document incorporated by reference therein, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The Company shall reimburse each indemnified person for any
legal or other expenses reasonably incurred by the indemnified person (which
shall be limited as provided in this Section 1.5) in connection with
investigating or defending any Losses. However, the Company shall not be
liable in any case to the extent that any Losses arise out of or are based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made or incorporated by reference in the registration statement,
preliminary prospectus or final prospectus (as they may be amended or
supplemented) in reliance upon and in conformity with written information
furnished to the Company by an indemnified person specifically stating that
it is for use in preparation thereof or an indemnified person's failure to
deliver a copy of the registration statement or prospectus or any amendments
or supplements thereto to any purchaser. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the
indemnified person and shall survive the transfer of the Registrable
Securities by the holders.

                                       8
<PAGE>

         In the event of the registration of any holder's Registrable Securities
under the Securities Act pursuant to the provisions hereof, the holder shall, to
the extent permitted by law, indemnify and hold harmless the Company, each
director of the Company, each officer of the Company who signs the registration
statement, each underwriter, broker and dealer, if any, who participates in the
offering and sale of the Registrable Securities and each other person, if any,
who controls or is controlled by the Company or any such underwriter, broker or
dealer within the meaning of the Securities Act, against any Losses to which the
Company, such director, officer, underwriter, broker or dealer or controlling or
controlled person may become subject under the Securities Act or otherwise,
insofar as such Losses (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained or incorporated by reference in the registration statement, any
preliminary prospectus or final prospectus contained therein (as they may be
amended or supplemented), or any document incorporated by reference therein, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, which untrue statement or alleged untrue
statement or omission or alleged omission has been made or incorporated therein
in reliance upon and in conformity with written information furnished to the
Company by the holder of Registrable Securities specifically stating that it is
for use in the preparation thereof. Such holder of Registrable Securities shall
also reimburse the Company, each such director, officer, underwriter, broker,
dealer and controlling or controlled person for any legal or other expenses
reasonably incurred by the Company, such director, officer, underwriter, broker,
dealer or controlling or controlled person in connection with investigating or
defending any such Losses.

         Each party entitled to indemnification under this Section 1.5 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, but the
failure of any Indemnifying Party to give such notice shall not relieve the
Indemnifying Party of its obligations under this Section 1.5 (except and to the
extent the Indemnifying Party has been materially prejudiced as a consequence
thereof). The Indemnifying Party shall be entitled to participate in, and if it
provides written notice to the Indemnified Party promptly after receiving the
notice from the Indemnified Party, at its expense to assume, the defense of any
such claim or any litigation resulting therefrom with counsel reasonably
satisfactory to the Indemnified Party; provided, that the Indemnified Party may
participate in such defense at its expense, notwithstanding the assumption of
such defense by the Indemnifying Party, and provided, further, that if the
defendants in any such action shall include both the Indemnified Party and the
Indemnifying Party and the Indemnified Party shall have reasonably concluded
that there may be a conflict of interest in counsel representing both the
Indemnifying Party and the Indemnified Party, the Indemnified Party or Parties
shall have the right to select one separate counsel on behalf of all of the
Indemnified Party or Parties and the reasonable fees and expenses of such
counsel shall be paid by the Indemnifying Party. No Indemnifying Party, in the
defense of any such claim or litigation, shall, except with the consent of each
Indemnified Party (which shall not be unreasonably withheld), consent to entry
of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to the
Indemnified Party of a

                                       9
<PAGE>

release from all liability in respect to such claim or litigation. Each
Indemnified Party shall furnish such information regarding itself or the
claim in question as an Indemnifying Party may reasonably request in writing
and as shall be reasonably required in connection with the defense of such
claim and litigation resulting therefrom.

         The amount paid or payable by an Indemnifying Party as a result of the
Losses (or actions in respect thereof) referred to above in this Section 1.5 or
Section 1.6 hereof shall include any legal or other expenses reasonably incurred
by the Indemnified Party in connection with investigating or defending any such
action or claim (which shall be limited as provided in this Section 1.5). No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.

         Indemnification similar to that specified in the preceding provisions
of this Section 1.5 (with appropriate modifications) shall be given by the
Company to the holders of Registrable Securities being registered and by such
holders to the Company with respect to any required registration or other
qualification of such Registrable Securities under any federal or state law or
regulation of governmental authority other than the Securities Act.

         In the event of any underwritten offering of the Registrable Securities
under the Securities Act pursuant to the provisions of this Section 1, the
Company and the holders thereof agree to enter into an underwriting agreement,
in standard form, with the underwriters, which underwriting agreement may
contain provisions with respect to indemnification different from those set
forth in this Section 1.5, but this Agreement shall govern as between the
Company and such holders.

                  1.6      EXCHANGE ACT REGISTRATION. The Company covenants and
agrees that until such time as a holder no longer holds any of the
Registrable Securities:

                           1.6.1    subsequent to any registration of Common
Stock under the Securities Act, the Company shall, if required by law,
maintain an effective registration statement (containing such information and
documents as the Commission shall specify) with respect to the Common Stock
under Section 12(g) of the Exchange Act and shall file on time such
information, documents and reports as the Commission may require or prescribe
for companies whose stock has been registered pursuant to said Section 12(g);

                           1.6.2    the Company shall, if a registration
statement with respect to the shares of the Company under Section 12(b) or
Section 12(g) of the Exchange Act is, or is required to be maintained,
effective, upon the request of the holder, make whatever other filings with
the Commission or otherwise make generally available to the public such
financial and other information as may be reasonably necessary in order to
enable the holder to be permitted to sell its Registrable Securities pursuant
to the provisions of Rule 144 promulgated under the Securities Act (or any
successor rule or regulation thereto or any statute hereafter adopted to
replace or to establish the exemption that is now covered by said Rule 144)
if otherwise available; and

                                      10
<PAGE>

                           1.6.3    upon the reasonable request of the holder,
the Company shall deliver to the holder a written statement as to whether the
Company has complied with the requirements of this Section 1.6.

         The Company represents and warrants that the registration statement or
any information, documents or reports filed with the Commission and incorporated
by reference therein shall not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in
order to make the statements contained therein, in light of the circumstances
under which such statements were made, not misleading. The Company agrees to
indemnify and hold harmless (or, to the extent the same is not enforceable, make
contribution to) the holders of Registrable Securities being registered, their
respective partners, officers, directors and agents, each broker, dealer or
underwriter (within the meaning of the Securities Act) acting for such holders
in connection with any offering or sale by such holders of Registrable
Securities or any person, firm or corporation controlling or controlled by
(within the meaning of the Securities Act) any such holder and any such broker,
dealer or underwriter from and against any and all Losses (or actions in respect
thereof) arising out of or resulting from any breach of the foregoing
representation or warranty, all on terms and conditions comparable to those set
forth in Section 1.5 hereof; provided, however, that the Company shall not be
liable in any such case to the extent that any such Losses arise out of or are
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made or incorporated by reference in the registration
statement, document or report in reliance upon filings made by any such holder
under the Exchange Act and in conformity with written information furnished to
the Company by any such holder specifically stating that it is for use in the
preparation thereof; provided, further, that the Company shall be given written
notice and an opportunity to participate in, and, to the extent that it may
wish, to assume on terms and conditions comparable to those set forth in Section
1.5 hereof, the defense thereof.

                  1.7      LIMITATION ON REGISTRATION RIGHTS OF OTHERS. The
Company covenants and agrees that, so long as there are any shares of
Registrable Securities in respect of which any of the rights of registration
provided for in this Section 1 shall continue, the Company shall not,
directly or indirectly, without the prior written consent of the holders of a
majority of such Registrable Securities, which consent shall not be
unreasonably withheld or delayed, grant at any time after the date hereof to
any person or agree to or otherwise become obligated in respect of any rights
of registration of securities of the Company which are either (i) more
favorable than, or (ii) in the nature or substantially in the nature of, the
rights of registration of the holders of Registrable Securities pursuant to
Sections 1.1 or 1.2 hereof; provided, however, that the consent of the
holders of Registrable Securities shall not be required with regard to (ii)
above if such rights of registration are being offered to a holder of
securities of the Company who purchased such securities for a price per share
equal to or greater than the then applicable Conversion Price (as defined in
the Company's Articles of Incorporation, as amended) per share of the shares
of Series B Preferred Stock issued to the Investors on the Effective Date.

                                      11
<PAGE>

                  1.8      EXCEPTION TO REGISTRATION. The Company shall not be
required to effect a registration of Registrable Securities under this
Agreement if (i) the Registrable Securities have been previously sold
pursuant to a registration under the Securities Act, (ii) in the written
opinion of counsel for the Company, which counsel and the opinion so rendered
shall be reasonably acceptable to the holders of a majority of Registrable
Securities, the holder may sell without registration under the Securities Act
substantially all of the Registrable Securities for which it requested
registration under the provisions of the Securities Act and in the manner and
in the quantity in which the Registrable Securities were proposed to be sold
or (iii) the Company shall have obtained from the Commission a "no-action"
letter to that effect; provided that this Section 1.8 shall not apply to
sales made under Rule 144(k) or any successor rule promulgated by the
Commission until two years after the effective date of the Company's initial
registration of shares under the Securities Act.

                  1.9      HOLDBACK OBLIGATIONS. Each holder of Registrable
Securities agrees not to make, during the seven days prior to and the 90 days
after the effective date of an underwritten registration by the Company, any
public sale or distribution of any of its Registrable Securities (except as
part of the underwritten registration or pursuant to a registration on Form
S-8 or any successor or comparable forms), including a sale pursuant to Rule
144, unless the managing underwriter agrees otherwise. The Company agrees not
to make any public sale or distribution of any of its equity securities or
any securities convertible into or exchangeable or exercisable for any of its
equity securities, including a sale under Regulation D of the Securities Act
or under any other exemption of the Securities Act (except as part of the
underwritten registration or pursuant to a registration on Form S-4, Form S-8
or any successor or comparable forms), during the seven days prior to and the
90 days after the effective date of any underwritten registration by the
Company, unless the managing underwriter agrees otherwise. The Company also
agrees to use reasonable efforts to cause each holder of at least 5% (on a
fully-diluted basis) of its equity securities or any securities convertible
into or exchangeable or exercisable for any of its equity securities,
purchased from the Company at any time on or after the date of this Agreement
(other than pursuant to a registration), and shall cause each holder of its
equity securities or any securities convertible into or exchangeable or
exercisable for any of its equity securities who is selling securities
pursuant to an underwritten registration, to agree not to make any public
sale or distribution of those securities, including a sale pursuant to Rule
144 (except as part of the underwritten registration or pursuant to a
registration on Form S-8 or any successor or comparable forms), during the
seven days prior to and the 90 days after the effective date of the
registration, unless the managing underwriter agrees otherwise.
Notwithstanding anything to the contrary herein, this Section 1.9 shall not
apply to any of the Investors, or their partners, members or shareholders.

         2.       SPECIFIC PERFORMANCE. The Company recognizes that the rights
of the holders of Registrable Securities under this Agreement are unique and,
accordingly, the holders shall, in addition to such other remedies as may be
available to them at law or in equity, have the right to enforce their rights
hereunder by actions for injunctive relief and specific performance to the
extent permitted by law. This Agreement is not intended to limit or abridge
any right of the holders of Registrable Securities which may exist apart from
this Agreement.

                                      12
<PAGE>

         3.       EXPENSES. Pursuant to Section 23 of the Purchase Agreement,
the Company shall pay all expenses incident to the performance or enforcement
of this Agreement, including all fees and expenses of counsel for all
activities undertaken pursuant to this Agreement, except as otherwise
provided in Section 1 hereof.

         4.       NOTICES, ETC. All notices and other communications hereunder
shall be in writing and shall be (i) mailed by first class or express mail,
postage prepaid, (ii) sent by telex, telegram, telecopy or other similar form
of rapid transmission, confirmed by mailing (by first class or express mail,
postage prepaid) written confirmation at substantially the same time as such
rapid transmission, or (iii) personally delivered to an officer of the
receiving party. All such communications shall be mailed, sent or delivered
as follows:

              If to the Company:      DPEC, Inc.
                                      851 West Third Street
                                      Building 3
                                      Columbus, Ohio 43212
                                      Attn:  Carol A. Clark

              with a copy to:         Vorys, Sater, Seymour and Pease LLP
                                      52 East Gay Street
                                      Columbus, Ohio 43215
                                      Attn:  Michael A.  Cline, Esq.

              If to the Investors
              or other holder
              of Registrable
              Securities:             River Cities Capital Fund II Limited
                                      Partnership
                                      221 East Fourth Street, Suite 1900
                                      Cincinnati, Ohio 45202
                                      Attn: Murray R. Wilson

                                      JG Funding, LLC
                                      1850 National City Tower
                                      101 South Fifth Street
                                      Louisville, Kentucky 40202
                                      Attn: David Jones, Jr.

                                      Saunders Capital Group, LLC
                                      1850 National City Tower
                                      101 South Fifth Street
                                      Louisville, Kentucky 40202
                                      Attn: Robert S. Saunders

                                      13
<PAGE>

                                      Irving W. Bailey II
                                      c/o Bailey Capital Corporation
                                      205 Worth Avenue, Suite 201
                                      Palm Beach, Florida 33480

              with a copy to:         Graydon, Head & Ritchey
                                      1900 Fifth Third Center
                                      511 Walnut Street
                                      Cincinnati, Ohio 45202
                                      Attn: Michael A. Hirschfeld, Esq.

or to such other person(s) or address(es) as the addressee shall have furnished
to the sender in writing.

         Any notice so addressed and mailed shall be deemed to be given when so
mailed. Any notice so sent by rapid transmission shall be deemed to be given
when receipt of such transmission is acknowledged, and any communication so
delivered in person shall be deemed to be given when receipted for by, or
actually received by, an authorized officer of the party to whom it is given.

         5.       ENTIRE AGREEMENT. The parties hereto agree that this Agreement
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings as between
them as to such subject matter. There are no restrictions, agreements or
arrangements, oral or written, between the parties relating to the subject
matter hereof which are not fully expressed or referred to herein.

         6.       WAIVERS AND FURTHER AGREEMENTS. No waiver of any breach of any
term or condition of this Agreement shall operate as a waiver of any other
breach of such terms or conditions or any other term or condition, nor shall
any failure to enforce any provision hereof operate as a waiver of such
provision or of any other provision hereof. Each of the parties hereto agrees
to execute all such further instruments and documents and to take all such
further actions as the other parties may reasonably require in order to
effectuate the terms and purposes of this Agreement.

         7.       AMENDMENTS. This Agreement may not be amended nor shall any
waiver, change, modification, consent or discharge be effected except by an
instrument in writing executed by or on behalf of the party against whom
enforcement of any amendment, waiver, change, modification, consent or
discharge is sought.

         8.       ASSIGNMENT; SUCCESSORS AND ASSIGNS. This Agreement shall be
binding  upon and shall inure to the benefit of the Investors and their
successors and permitted assigns and, provided that any transaction entered
into by the Company is in accordance with Section 10.8 of the Purchase
Agreement, this Agreement shall be binding upon and shall inure to the
benefit of the Company and its successors and permitted assigns.

                                      14
<PAGE>

         9.       SEVERABILITY. If any provision of this Agreement shall be held
or deemed to be, or shall in fact be, invalid, inoperative or unenforceable
as applied to any particular case in any jurisdiction or jurisdictions, such
circumstance shall not have the effect of rendering the provision or
provisions in question, invalid, inoperative or unenforceable in any other
jurisdiction or in any other case or circumstance or of rendering any other
provision or provisions herein contained invalid, inoperative or
unenforceable, but this Agreement shall be reformed and construed in any such
jurisdiction or case as if such invalid, inoperative or unenforceable
provision had never been contained herein and such provision reformed so that
it would be valid, operative and enforceable to the maximum extent permitted
in such jurisdiction or in such case.

         10.      COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument, and in pleadings or proving any
provision of this Agreement, it shall not be necessary to produce more than
one of such counterparts.

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

         12.      PLURALS. Whenever used herein, the singular number shall
include the plural and the plural shall include the singular.

         13.      GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Ohio.

         14.      TERMINATION OF THE PRIOR REGISTRATION RIGHTS AGREEMENT. The
Prior Registration Rights Agreement is hereby terminated and shall be of no
further force or effect.

                                      15
<PAGE>

         IN WITNESS WHEREOF, the parties have executed or caused to be executed
this Agreement as of the date first above written.

                                              DPEC, INC.

                                              By:  /s/ Carol A. Clark
                                                 -------------------------------
                                                     Carol A. Clark,
                                                     President

                                              RIVER CITIES CAPITAL FUND II
                                              LIMITED PARTNERSHIP

                                              By: /s/ Edwin T. Robinson
                                                 ------------------------------
                                                   Edwin T. Robinson, President
                                                   of Mayson, Inc., the General
                                                   Partner of River Cities
                                                   Capital Fund II Limited
                                                   Partnership

                                              JG FUNDING, LLC

                                              By:  /s/ David Jones, Jr.
                                                 -------------------------------
                                                       David Jones, Jr., Manager
                                                       of Chrysalis Ventures,
                                                       LLC, the Manager of JG
                                                       Funding, LLC

                                              SAUNDERS CAPITAL GROUP, LLC

                                              By: /s/ Robert S. Saunders
                                                 -------------------------------
                                                      Robert S. Saunders,
                                                      Manager

                                              /s/Irving W. Bailey II
                                              ----------------------------------
                                              Irving W. Bailey II

                                      16

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