AMENDMENT NO. 3 TO REVOLVING CREDIT AND SECURITY AGREEMENT

Exhibit 10.87

AMENDMENT NO. 3
TO REVOLVING CREDIT AND SECURITY AGREEMENT

     THIS AMENDMENT NO. 3 (this “Agreement”) is entered into as of March 26, 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”, collectively with 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.  Amendment . Subject to the satisfaction of Section 5 below, the Loan Agreement is hereby amended as follows:

        (a) Sections 6.5(b) and (c) of the Loan Agreement are hereby amended to read in their entirety as set forth below:

“(b) Leverage Ratio . Maintain as of the end of each fiscal quarter, a ratio of (i) Funded Debt of the Loan Parties on a Consolidated Basis outstanding on the last day of each fiscal quarter set forth below to (ii) EBITDA of the Loan Parties on a Consolidated Basis, for the twelve month period ending on the last day of such fiscal quarter, of not greater than the ratio set forth below opposite such period:

     (c) Minimum EBITDA . Maintain as of the end of each fiscal quarter set forth below, for the twelve month period ending on the last day of such fiscal quarter, EBITDA of DRI on a Consolidated Basis of at least the amount set forth opposite such fiscal quarter:

     3.  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, (y) an amendment fee of $15,000, which may be charged to Borrowers’ Account as a Revolving Advance and (z) an executed copy of an amendment to the Subordinated Loan Documentation in form and substance satisfactory to Agent.

     4.  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 amen