Document:

exv10w22w4

Exhibit 10.22.4

CONSENT AND AMENDMENT NO. 5

TO REVOLVING CREDIT AND SECURITY AGREEMENT

     THIS CONSENT AND AMENDMENT NO. 5 (this “Agreement”) is entered into as of October 5, 2009, by
and between DIGITAL RECORDERS, INC. (“DR”), TWINVISION OF NORTH AMERICA, INC. (“TVna”, collectively
with DR, each a “Borrower”, and collectively the “Borrowers”), DRI CORPORATION (“DRI”, DRI and the
Borrowers, each a “Loan Party, and collectively, the “Loan Parties”), the financial institutions
party hereto (collectively, the “Lenders” and individually a “Lender”) and PNC BANK, NATIONAL
ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity, the “Agent”).

BACKGROUND

     Loan Parties, Lenders and Agent are parties to that certain Revolving Credit and Security
Agreement dated June 30, 2008 (as amended, restated, supplemented or otherwise modified from time
to time, the “Loan Agreement”) pursuant to which Agent and Lenders provide Borrowers with certain
financial accommodations.

     Loan Parties have requested that Agent and Lenders amend certain provisions of the Loan
Agreement as hereafter provided, and Agent and Lenders are willing to do so on the terms and
conditions hereafter set forth.

     NOW, THEREFORE, in consideration of any loan or advance or grant of credit heretofore or
hereafter made to or for the account of Borrowers by Agent or Lenders, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:

     1. Definitions. All capitalized terms not otherwise defined or amended herein shall have
the meanings given to them in the Loan Agreement.

     2. Consent.

          (a) Notwithstanding anything to the contrary contained in the Loan Agreement, the Agent and
Lenders consent to DRI issuing the Series K Preferred Stock (as defined below), so long as the net
proceeds are utilized (i) to repay outstanding Advances and to use Advances to make a recallable
equity investment in Mobitec AB on or after the Fifth Amendment Effective Date in an amount not to
exceed the Contribution Amount and (ii) make a prepayment of the Subordinated Notes;
provided that (x) the amount of the proceeds applied to repay Advances must be equal to or
greater than the Contribution Amount (as defined below) and (y) the amount of the proceeds applied
to prepay the Subordinated Notes may not exceed the Prepayment Amount.

          (b) Notwithstanding anything to the contrary contained in Section 1 of the Intercreditor
Agreement, Agent and Lenders consent to the prepayment of the Subordinated
Notes by DRI with a portion of the proceeds of the Series K Preferred Stock in an amount not
to exceed the Prepayment Amount.

 

 

          (c) Notwithstanding anything to the contrary contained in the Intercreditor Agreement or
Section 7.21 of the Loan Agreement, the Agent and Lenders hereby consent to the amendment of the
Junior Agreement (as defined in the Intercreditor Agreement) and the Warrant (as defined in the
Junior Agreement), in each case substantially in the forms set forth as Exhibit A hereto.

     3. Amendment. Subject to the satisfaction of Section 3 below, the Loan Agreement is
hereby amended as follows:

          (a) Section 1.2 of the Credit Agreement is hereby amended by inserting the following defined
terms in appropriate alphabetical order:

     “Contribution Amount” means, if DRI receives gross proceeds from the
issuance of the Series K Preferred Stock of (i) no more than $3,500,000, $1,000,000,
(ii) $5,000,000 or more, $1,500,000, and (iii) in excess of $3,500,000, but less than
$5,000,000, $1,000,000 plus the Contribution Excess Amount.

     “Contribution Excess Amount” means the lesser of (i) $500,000 and (ii) an
amount determined by multiplying (x) the quotient (expressed as a percentage) of (a)
the amount by which gross proceeds from the issuance of the Series K Preferred Stock
exceed $3,500,000, divided by (b) $1,500,000, by (y) $500,000.

     “Fifth Amendment” means that certain Amendment No. 5 to the Revolving
Credit and Security Agreement, dated as of October 5, 2009, among the Loan Parties,
the Agent and the Lenders.

     “Fifth Amendment Effective Date” has the meaning set forth in the Fifth
Amendment.

     “Prepayment Amount” means, if DRI receives gross proceeds from the
issuance of the Series K Preferred Stock of (i) no more than $3,500,000, $250,000,
(ii) $5,000,000 or more, $1,000,000, and (iii) in excess of $3,500,000, but less than
$5,000,000, $250,000 plus the Prepayment Excess Amount.

     “Prepayment Excess Amount” means the lesser of (i) $750,000 and (ii) an
amount determined by multiplying (x) the quotient (expressed as a percentage) of (a)
the amount by which gross proceeds from the issuance of the Series K Preferred Stock
exceed $3,500,000, divided by (b) $1,500,000, by (y) $750,000.

     “Series K Preferred Stock” means the Series K Senior Convertible
Preferred Stock of DRI, issued on or about the Fifth Amendment Effective Date, the net
proceeds of which are to be applied (i) in repayment of outstanding Advances and to
use Advances to make a recallable equity investment in Mobitec AB on or after the
Fifth Amendment Effective Date in an amount not to exceed
the Contribution Amount and (ii) to make a prepayment of the Subordinated Note;
provided that the amount of the proceeds applied to repay Advances must be
equal to or greater than the Contribution Amount.

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     (b) Section 2.22 of the Loan Agreement is hereby amended by deleting the word “and” where it
appears immediately before sub-clause (iii) of clause (a) thereof, and by inserting the following
sub-clause immediately prior to the period at the end of such clause (a):

“and (iv) make a recallable equity investment in Mobitec AB on or after the Fifth
Amendment Effective Date in an amount not to exceed the Contribution Amount”.

     (c) Section 3.4(a) of the Loan Agreement is hereby amended by deleting the amount “$2,000”
appearing therein and inserting “$2,500” in lieu thereof.

     (d) Section 3.4(b) of the Loan Agreement is hereby amended by deleting the amount “$750”
appearing therein and inserting “$850” in lieu thereof.

     (e) Section 7.4 of the Loan Agreement is hereby amended by deleting the word “and” where it
appears immediately prior to clause (f) thereof, and by inserting the following clause immediately
prior to the period at the end of such paragraph:

“and (g) a recallable equity investment in Mobitec AB in an amount not to exceed the
Contribution Amount”.

     (f) Section 7.7 of the Loan Agreement is hereby amended by deleting “$150,000” from clause
(ii) of the proviso therein, and substituting therefor “the sum of (a) $150,000 plus (b) the result
of 9.5% of the amount of Series K Preferred Stock issued by the Guarantor on or prior to October
31, 2009”.

     (g) Section 7.10 of the Loan Agreement is hereby amended by amending clause (y) of the second
sentence thereof to read in its entirety as follows:

“(y) any such transactions, capital contributions, investments and transfers, which,
in the aggregate for all such events, do not exceed $2,000,000 plus the Contribution
Amount”.

     (h) Section 7.15 of the Loan Agreement is hereby amended by adding the following proviso
immediately prior to the period at the end of such paragraph:

“provided, that DRI shall be permitted to adopt the Certificate of Designation
of, and amend its Articles of Incorporation to authorize, the Series K Preferred
Stock”.

     (i) Section 7.17 of the Loan Agreement is hereby amended by adding the following proviso to
the end of clause (y) thereof:

“provided, that on or after the Fifth Amendment Effective Date, the Loan
Parties may make a prepayment of the Indebtedness outstanding under the Subordinated
Note with the proceeds of the issue of Series K Preferred Stock in an amount not to
exceed the Prepayment Amount”.

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     4. Conditions of Effectiveness. This Agreement shall become effective when Agent shall
have received (x) four (4) copies of this Agreement executed by the Required Lenders and each Loan
Party and (y) a copy of an amendment to the Subordinated Notes in form and substance satisfactory
to Agent.

     5. Representations, Warranties and Covenants. Each Loan Party hereby represents,
warrants and covenants as follows:

     (a) This Agreement and the Loan Agreement constitute legal, valid and binding obligations of
such Loan Party and are enforceable against such Loan Party in accordance with their respective
terms.

     (b) Upon the effectiveness of this Agreement, each Loan Party hereby reaffirms all covenants,
representations and warranties made in the Loan Agreement to the extent the same are not amended
hereby and agrees that all such covenants, representations and warranties shall be deemed to have
been remade as of the effective date of this Agreement.

     (c) The execution, delivery and performance of this Agreement and all other documents in
connection therewith has been duly authorized by all necessary corporate action, and does not
contravene, violate or cause the breach of any agreement, judgment, order, law or regulation
applicable to any Loan Party

     (d) No Event of Default or Default has occurred and is continuing or would exist after giving
effect to this letter amendment.

     (e) No Loan Party has any defense, counterclaim or offset with respect to the Loan Agreement
or the Obligations.

     6. Effect on the Loan Agreement.

     (a) Upon the effectiveness of this Agreement, each reference in the Loan Agreement to “this
Agreement,” “hereunder,” “hereof,” “herein” or words of like import shall mean and be a reference
to the Loan Agreement as amended hereby. Except as specifically amended herein, the Loan
Agreement, and all other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed.
This Agreement shall constitute an “Other Document” for all purposes under the Loan Agreement.

     (b) The execution, delivery and effectiveness of this Agreement shall not operate as a waiver
of any right, power or remedy of Agent or any Lender, nor constitute a waiver of any provision of
the Loan Agreement, or any other documents, instruments or agreements executed and/or delivered
under or in connection therewith.

     7. Release. The Loan Parties hereby acknowledge and agree that: (a) neither they nor
any of their Affiliates have any claim or cause of action against Agent or any Lender (or any of
Agent’s or any Lender’s Affiliates, officers, directors, employees, attorneys, consultants or
agents) and (b) Agent and each Lender have heretofore properly performed and satisfied in a timely
manner all of their respective obligations to the Loan Parties under the Loan Agreement

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and the Other Documents. Notwithstanding the foregoing, Agent and each Lender wish (and the Loan Parties
agree) to eliminate any possibility that any past conditions, acts, omissions, events or
circumstances would impair or otherwise adversely affect any of Agent’s or such Lender’s rights,
interests, security and/or remedies under the Loan Agreement and the Other Documents. Accordingly,
for and in consideration of the agreements contained in this Agreement and other good and valuable
consideration, the Loan Parties (for themselves and their Affiliates and the successors, assigns,
heirs and representatives of each of the foregoing) (each a “Releasor” and collectively, the
“Releasors”) does hereby fully, finally, unconditionally and irrevocably release and forever
discharge Agent, each Lender and each of their respective Affiliates, officers, directors,
employees, attorneys, consultants and agents (each a “Released Party” and collectively, the
“Released Parties”) from any and all debts, claims, obligations, damages, costs, attorneys’ fees,
suits, demands, liabilities, actions, proceedings and causes of action, in each case, whether known
or unknown, contingent of fixed, direct or indirect, and of whatever nature or description, and
whether in law or in equity, under contract, tort, statute or otherwise, which any Releasor has
heretofore had or now or hereafter can, shall or may have against any Released Party by reason of
any act, omission or thing whatsoever done or omitted to be done on or prior to the date hereof
arising out of, connected with or related in any way to this Agreement, the Loan Agreement or any
Other Document, or any act, event or transaction related or attendant thereto, or Agent’s or any
Lender’s agreements contained therein, or the possession, use, operation or control of any of the
assets of agreements contained therein, or the possession, use, operation or control of any of the
assets of the Loan Parties, or the making of any advance, or the management of such advance or the
Collateral.

     8. Governing Law. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns and shall be governed by and construed
in accordance with the laws of the State of New York (other than those conflict of law rules that
would defer to the substantive law of another jurisdiction).

     9. Cost and Expenses. Loan Parties hereby agree to pay the Agent, on demand, all costs
and reasonable expenses (including reasonable attorneys’ fees and legal expenses) incurred in
connection with this Agreement and any instruments or documents contemplated hereunder.

     10. Headings. Section headings in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other purpose.

     11. Counterparts; Facsimile Signatures. This Agreement may be executed by the parties
hereto in one or more counterparts of the entire document or of the signature pages hereto, each of
which shall be deemed an original and all of which taken together shall constitute one and the same
agreement. Any signature received by facsimile or electronic transmission shall be deemed an
original signature hereto.

[Remainder of page intentionally left blank]

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     IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first written
above.

	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION,

as Lender and as Agent

 	 
	 	By:  	/s/  John Trieu
 	 
	 	 	Name:  	John Trieu 	 
	 	 	Title:  	Vice President 	 
	 
	 	DRI CORPORATION

 	 
	 	By:  	/s/  Stephen P. Slay
 	 
	 	 	Name:  	Stephen P. Slay 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	DIGITAL RECORDERS, INC.

 	 
	 	By:  	/s/  Stephen P. Slay
 	 
	 	 	Name:  	Stephen P. Slay 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	TWINVISION OF NORTH AMERICA, INC.

 	 
	 	By:  	/s/  Stephen P. Slay
 	 
	 	 	Name:  	Stephen P. Slay 	 
	 	 	Title:  	Chief Financial Officer 	 
	 

[Signature Page to Amendment No. 5]exv10w24w7

Exhibit 10.24.7

FOURTH AMENDMENT TO THE LOAN AND SECURITY AGREEMENT

     THIS FOURTH AMENDMENT is entered into as of October 1, 2009 (this “Amendment”) among
DIGITAL RECORDERS, INC., a North Carolina corporation (“Digital”), TWINVISION OF NORTH
AMERICA, INC., a North Carolina corporation (“TwinVision” and, together with Digital, the
“Borrowers”), DRI CORPORATION, a North Carolina corporation (“Guarantor” and,
together with the Borrowers, the “Loan Parties”), and BHC INTERIM FUNDING III, L.P., a
Delaware limited partnership (“Lender”), to that certain Loan and Security Agreement dated
as of June 30, 2008 (as amended, modified, supplemented or restated from time to time, the
“Loan Agreement”) among the Loan Parties and Lender. Terms which are capitalized in this
Amendment and not otherwise defined shall have the meanings ascribed to such terms in the Loan
Agreement.

     WHEREAS, the Loan Parties have advised the Lender that the Board of Directors of the Guarantor
has authorized, and the Guarantor proposes to issue, up to 1,000 shares of Series K Senior
Convertible Preferred Stock (the “Series K Preferred Stock”) as set forth on that certain
Certificate of Designation attached hereto as Exhibit A;

     WHEREAS, in connection with the proposed offering of Series K Preferred Stock, the Loan
Parties have requested that the Lender agree to modify certain terms of the Loan Agreement, and the
Lender is willing to do so, on the terms and subject to the satisfaction of the conditions
contained herein.

     NOW, THEREFORE, in consideration of the mutual promises contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Loan
Parties and Lender hereby agree as follows:

     Section One. Definitions. Terms which are capitalized in this Amendment and
not otherwise defined shall have the meanings ascribed to such terms in the Loan Agreement as
amended by this Amendment.

     Section Two. Amendment to Loan Agreement. Effective upon satisfaction of the
conditions precedent set forth in Section Four hereof, the Loan Agreement is hereby amended
as follows:

     (a) Section 1.3 is hereby amended by inserting the following definitions in the appropriate
alphabetical order:

     “Additional Prepayment Amount” means the lesser of (i) $750,000 and
(ii) an amount determined by multiplying (x) the quotient (expressed as a
percentage) of (a) the amount by which gross proceeds from the issuance of the
Series K Preferred Stock exceed $3,500,000, divided by (b) $1,500,000, by (y)
$750,000.

     “Contribution Amount” means, if the Guarantor receives gross proceeds
from the issuance of the Series K Preferred Stock of (i) no more than $3,500,000,
$1,000,000, (ii) of $5,000,000, $1,500,000, and (iii) an amount in excess of

 

 

$3,500,000 and less than $5,000,000, the sum of $1,000,000 plus the Excess
Amount.

     “Excess Amount” means the lesser of (i) $500,000 and (ii) an amount
determined by multiplying (x) the quotient (expressed as a percentage) of (a) the
amount by which gross proceeds from the issuance of the Series K Preferred Stock
exceed $3,500,000, divided by (b) $1,500,000, by (y) $500,000.

     “Fourth Amendment” means that certain Fourth Amendment to the Loan and
Security Agreement, dated as of October 1, 2009, among the Loan Parties and the
Lender, as the same may be amended, restated, supplemented or otherwise modified or
extended or renewed from time to time.

     “Fourth Amendment Effective Date” has the meaning set forth in the
Fourth Amendment.

     “Series K Preferred Stock” means the Series K Senior Convertible
Preferred Stock of the Guarantor in an amount not to exceed $5,000,000 and described
in that certain Certificate of Designation attached as Exhibit A to the Fourth
Amendment, issued on or about the Fourth Amendment Effective Date, .

     “Prepayment Amount” means, if the Guarantor receives gross proceeds
from the issuance of the Series K Preferred Stock of (i) no more than $3,500,000,
$250,000, (ii) of $5,000,000, $1,000,000, and (iii) an amount in excess of
$3,500,000 and less than $5,000,000, the sum of $250,000 plus the Additional
Prepayment Amount.

     (b) Pursuant to Section 5.13 (Revisions or Updates to Schedules) of the Loan Agreement,
Schedule 4.1(B) is hereby updated and revised as set forth as Exhibit B hereto;

     (c) Section 6.3(A) (Transfers; Liens and Related Matters; Transfers) of the Loan Agreement is
hereby amended by deleting the word “and” where it appears immediately before clause (c) thereof,
and by inserting the following immediately prior to the period at the end of such paragraph:

     , (d) the Loan Parties shall be permitted to make a recallable equity investment in
Mobitec AB on or about the Fourth Amendment Effective Date in an amount not to
exceed the Contribution Amount and (e) the Loan Parties shall be permitted to make a
recallable equity investment in Mobitec Par on or about the Fourth Amendment
Effective Date in an amount not to exceed $400,000

     (d) Section 6.4 (Restricted Payments) of the Loan Agreement is hereby amended by deleting
“$150,000” from clause (ii) of the proviso therein, and substituting therefor the following:

the sum of (a) $150,000 plus (b) the result of 9.5% of the amount of Series K
Preferred Stock issued by the Guarantor on or prior to October 31, 2009

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     (e) Section 6.6 (Transactions with Affiliates) of the Loan Agreement is hereby amended by
amending and restating clause (y) of the second sentence thereof as follows:

(y) any such transactions, capital contributions, investments and transfers, which,
in the aggregate for all such events, do not exceed $2,000,000 plus the
Contribution Amount

     (f) Section 6.14 (Organizational Documents) of the Loan Agreement is hereby amended by adding
the following proviso immediately prior to the period at the end of such paragraph:

provided, that Guarantor shall be permitted to adopt the Certificate of Designation
of, and amend its Organizational Documents to authorize, the Series K Preferred Stock

     Section Three. Representations and Warranties. To induce Lender to enter into
this Amendment, the Loan Parties hereby warrant and represent to Lender as follows:

     (a) all of the representations and warranties contained in the Loan Agreement and each other
Loan Document to which the Loan Parties are a party continue to be true and correct in all material
respects as of the date hereof, as if repeated as of the date hereof, except for such
representations and warranties which, by their terms, are expressly made only as of a previous
date;

     (b) the execution, delivery and performance of this Amendment by each of the Loan Parties is
within their corporate powers, has been duly authorized by all necessary corporate action on their
part, and each of the Loan Parties has received all necessary consents and approvals (if any are
required) for the execution and delivery of this Amendment;

     (c) the Organizational Documents of Borrowers and Guarantor previously delivered to Lender by
the Loan Parties have not been amended or modified in any respect as of the date hereof; except
that the Organizational Document of Guarantor have been modified by the Articles of Amendment to
Articles of Incorporation of DRI;

     (d) upon execution of this Amendment, the Loan Agreement as amended by this Amendment shall
constitute the legal, valid and binding obligation of the Loan Parties, enforceable against the
Loan Parties in accordance with their terms as so amended, except as such enforceability may be
limited by (i) bankruptcy, insolvency or similar laws affecting creditors’ rights generally and
(ii) general principles of equity;

     (e) except as set forth herein or as the Loan Parties or their representatives shall have
notified Lender of in writing, none of the Loan Parties are in default under any indenture,
mortgage, deed of trust, or other material agreement or material instrument to which they are a
party or by which they may be bound which could have a Material Adverse Effect. Neither the
execution and delivery of this Amendment, nor the consummation of the transactions herein
contemplated, nor compliance with the provisions hereof will (i) violate any law or regulation
applicable to any of the Loan Parties, (ii) cause a violation by any of the Loan Parties of any

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order or decree of any court or government instrumentality applicable to them, (iii) conflict
with, or result in the breach of, or constitute a default under, any indenture, mortgage, deed of
trust, or other material agreement or material instrument to which any of the Loan Parties is a
party or by which they may be bound, or (iv) result in the creation or imposition of any lien,
charge, or encumbrance upon any property of any of the Loan Parties, except in favor of Lender, to
secure the Obligations.

     (f) no Default or Event of Default has occurred and is continuing; and

     (g) since the date of the Loan Parties’ most recent financial statements delivered to Lender,
no change or event has occurred which has had, or is reasonably likely to have, a Material Adverse
Effect.

     Section Four. Conditions Precedent. This Amendment shall become effective on
the date (the “Fourth Amendment Effective Date”) on which the following conditions
precedent are satisfied, as determined by Lender in its sole discretion:

     (a) Lender shall have received this Amendment, in form and substance satisfactory to Lender,
duly executed by the Loan Parties;

     (b) Lender shall have received that certain Consent and Amendment No. 5 to the Senior Lien
Financing Agreement, duly executed by the parties thereto and which shall permit, among other
things, Guarantor to apply the Prepayment Amount in repayment of the Obligations;

     (c) the Loan Parties shall have paid all amounts outstanding on or prior to the date of this
Amendment, including reimbursement or payment of all out-of-pocket expenses (including the legal
fees and expenses of Blank Rome LLP), incurred in connection with this Amendment, the Loan
Documents and the transactions contemplated hereby and thereby;

     (d) Lender shall have received a certificate of the secretary of Guarantor certifying the true
and correct copy of Articles of Amendment to its Articles of Incorporation, which shall be in full
force and effect as of the date of such certificate; and

     (e) no Default or Event of Default shall have occurred be continuing, and no event or
development which has had or is reasonably likely to have a Material Adverse Effect shall have
occurred, in each case, since the date of the Loan Parties’ most recent financial statements
delivered to Lender.

     Section Five. Release. The Loan Parties hereby acknowledge and agree that:
(a) neither they nor any of their Affiliates have any claim or cause of action against Lender (or
any of Lender’s Affiliates, officers, directors, employees, attorneys, consultants or agents) and
(b) Lender has heretofore properly performed and satisfied in a timely manner all of its
obligations to the Loan Parties under the Loan Agreement and the other Loan Documents.
Notwithstanding the foregoing, Lender wishes (and the Loan Parties agree) to eliminate any
possibility that any past conditions, acts, omissions, events or circumstances would impair or
otherwise adversely affect any of Lender’s rights, interests, security and/or remedies under the
Loan Agreement and the other Loan Documents. Accordingly, for and in
consideration of the

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agreements contained in this Amendment and other good and valuable consideration, the Loan Parties (for themselves and
their Affiliates and the successors, assigns, heirs and representatives of each of the foregoing)
(each a “Releasor”) do hereby fully, finally, unconditionally and irrevocably release and
forever discharge Lender and each of its Affiliates, officers, directors, employees, attorneys,
consultants and agents (each a “Released Party”) from any and all debts, claims,
obligations, damages, costs, attorneys’ fees, suits, demands, liabilities, actions, proceedings and
causes of action, in each case, whether known or unknown, contingent of fixed, direct or indirect,
and of whatever nature or description, and whether in law or in equity, under contract, tort,
statute or otherwise, which any Releasor has heretofore had or now or hereafter can, shall or may
have against any Released Party by reason of any act, omission or thing whatsoever done or omitted
to be done on or prior to the date hereof arising out of, connected with or related in any way to
this Amendment, the Loan Agreement or any other Loan Document, or any act, event or transaction
related or attendant thereto, or Lender’s agreements contained therein, or the possession, use,
operation or control of any of the assets of agreements contained therein, or the possession, use,
operation or control of any of the assets of the Loan Parties, or the making of any advance, or the
management of such advance or the Collateral.

     Section Six. Agreement. The Loan Parties shall promptly, but in any event not
later than the second Business Day, following the issuance by the Guarantor of the Series K
Preferred Stock, make (i) a prepayment of the principal amount of the Obligations equal to the
Prepayment Amount, provided that the Loan Parties shall pay to Lender amounts on account of the
Prepayment Amount as proceeds of such issuance are received (subject to the two Business Day grace
period) until the entire Prepayment Amount has been paid, (ii) an equity investment in Mobitec AB
in an amount equal to the Contribution Amount, and (iii) a repayment of a portion of the principal
amount outstanding under the Senior Lien Financing Agreement in an amount equal to the result of
the net proceeds of such issuance minus the sum of the Prepayment Amount and the Contribution
Amount. The failure of the Loan Parties to make any such prepayment, investment or repayment as
required by the preceding sentence shall be deemed to be an Event of Default under the Loan
Agreement as if set forth in the Loan Agreement and shall entitle Lender to exercise any and all
rights and remedies described in the Loan Agreement.

     Section Seven. General Provisions.

     (a) Except as herein expressly amended, each of the Loan Agreement and all of the other Loan
Documents are ratified and confirmed in all respects and shall remain in full force and effect in
accordance with their respective terms.

     (b) All references to the Loan Agreement in the Loan Agreement and each other Loan Document
shall mean such Loan Agreement as amended as of the effective date hereof, and as amended hereby
and as hereafter amended, supplemented and modified from time to time.

     (c) This Amendment embodies the entire agreement between the parties hereto with respect to
the subject matter hereof and supersedes all prior agreements, commitments, arrangements,
negotiations or understandings, whether written or oral, of the parties with respect thereto.

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     (d) Section and subsection headings in this Amendment are included herein for convenience of
reference only and shall not constitute a part of this Amendment for any other purpose or be given
any substantive effect.

     (e) THIS AMENDMENT AND ALL MATTERS RELATING HERETO AND ARISING HEREFROM (WHETHER ARISING UNDER
CONTRACT LAW, TORT LAW OR OTHERWISE) SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.

     (f) EACH LOAN PARTY FOR ITSELF AND ON BEHALF OF ITS SUBSIDIARIES HEREBY CONSENTS TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF NEW YORK, STATE OF NEW
YORK, AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING
OUT OF OR RELATING TO THIS AMENDMENT SHALL BE LITIGATED IN SUCH COURTS. EACH LOAN PARTY FOR ITSELF
AND ON BEHALF OF ITS SUBSIDIARIES ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND WAIVES
ANY DEFENSE OF FORUM NON CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH THIS AMENDMENT. IF ANY LOAN PARTY OR ANY SUBSIDIARY PRESENTLY IS, OR IN
THE FUTURE BECOMES, A NONRESIDENT OF THE STATE OF NEW YORK, EACH LOAN PARTY FOR ITSELF AND ON
BEHALF OF ITS SUBSIDIARIES HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT
ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON SUCH PERSON BY CERTIFIED OR REGISTERED MAIL, RETURN
RECEIPT REQUESTED, DIRECTED TO SUCH PERSON AT SUCH PERSON’S ADDRESS AS SET FORTH IN SECTION
8.6 OF THE LOAN AGREEMENT OR AS MOST RECENTLY NOTIFIED BY SUCH PERSON IN WRITING PURSUANT TO
SECTION 8.6 OF THE LOAN AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER
THE SAME HAS BEEN POSTED AS AFORESAID.

     (g) EACH LOAN PARTY FOR ITSELF AND ON BEHALF OF ITS SUBSIDIARIES AND LENDER HEREBY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AMENDMENT. EACH LOAN PARTY FOR ITSELF AND ON BEHALF OF ITS SUBSIDIARIES AND LENDER FURTHER WARRANT
AND REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY
AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

     (h) This Amendment is a Loan Document.

     (i) Nothing contained in this Amendment shall operate as a waiver of any right, power, or
remedy to which Lender may be entitled, nor constitute a waiver of any provision of the Loan
Agreement or any of the other Loan Documents, or any other documents, instruments or agreements
executed and/or delivered under or in connection therewith.

-6-

 

     (j) This Amendment may be executed by the parties hereto in one or more counterparts, each of
which when so executed shall be deemed an original; and such counterparts taken together shall
constitute one and the same agreement. Any signatures delivered by a party by facsimile or
electronic transmission shall be deemed an original signature hereto.

(This space intentionally left blank — signature page follows.)

-7-

 

     IN WITNESS WHEREOF, Loan Parties and Lender have signed below to indicate their agreement with
the foregoing and their intent to be bound thereby.

	 	 	 
	LENDER:
	 	BHC INTERIM FUNDING III, L.P.
	 
	 	 
	 
	 	By:  BHC Interim Funding Management III, L.P., its
	 
	 	General
Partner

	 
	 	By:  BHC Investors III, L.L.C., its Managing Member
	 
	 	By:  GHH Holdings III, L.L.C.

	 	 	 	 	 
	 	 	 
	 	By:  	                                              /s/ Gerald H. Houghton
 	 
	 	 	Gerald H. Houghton 	 
	 	 	Managing Member 	 
	 

	 	 	 	 	 
	BORROWERS: 	 DIGITAL RECORDERS, INC.

 	 
	 	By:  	/s/ David L. Turney
 	 
	 	 	David L. Turney 	 
	 	 	CEO, President 	 
	 
	 	TWINVISION OF NORTH AMERICA, INC.

 	 
	 	By:  	/s/ David L. Turney
 	 
	 	 	David L. Turney 	 
	 	 	CEO, President 	 
	 
	GUARANTOR: 	 DRI CORPORATION

 	 
	 	By:  	/s/ David L. Turney
 	 
	 	 	David L. Turney 	 
	 	 	CEO, President 	 
	 

Signature Page to Fourth Amendment to Loan and Security Agreement

 

Consented to and Acknowledged by:

	 	 	 	 	 
	 	DRI EUROPA AKTIEBOLAG

 	 
	 	By:  	/s/ David L. Turney
 	 
	 	 	David L. Turney 	 
	 	 	Chairman 	 
	 
	 	MOBITEC AB

 	 
	 	By:  	/s/ Stephen P. Slay
 	 
	 	 	Stephen P. Slay 	 
	 	 	Director 	 
	 

Acknowledgement to Fourth Amendment to Loan and Security Agreement

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