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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 1, 2006
Digital Recorders, Inc.
(Exact Name of Registrant as Specified in Charter)
North Carolina 1-13408 56-1362926
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
5949 Sherry Lane, Suite 1050 75225
Dallas, Texas (Zip Code)
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (214) 378-8992
Not applicable.
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 3.02. Unregistered Sales of Equity Securities.
Effective as of January 1, 2006, the Company will issue on a quarterly
basis restricted common stock of the Company to members of its Board of
Directors in lieu of cash for a portion of their monthly director fees. Under
this revised director compensation plan, members of the Board of Directors of
the Company shall be entitled to receive shares of restricted common stock of
the Company in an amount up to $12,000 annually. The Company intends to seek
shareholder approval of these revisions to the director compensation plan as
well at the next regular meeting of shareholders. The Board of Directors intends
to permit members of the Company's senior management team to also receive shares
of restricted common stock of the Company in lieu of cash compensation in an
amount up to $12,000 annually.
The shares issuable to the Company's Board of Directors and members of the
senior management team pursuant to the compensation plan shall be issued
quarterly at the then fair market value of such shares and shall be exempt from
registration under the Securities Act of 1933, as amended, in reliance on
Section 4(2) of such act as transactions by an issuer not involving any public
offering. The recipients of securities in each such transaction shall represent
their intentions to acquire the securities for investment only and not with a
view to or for sale in connection with any distribution thereof and appropriate
legends shall be affixed to the share certificates issued in such transactions.
All recipients shall have adequate access, through their relationships with the
Company, to information about the Company.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, we
have duly caused this report to be signed on our behalf by the undersigned
hereunto duly authorized.
DIGITAL RECORDERS, INC.
Date: January 5, 2006 By: /S/ DAVID N. PILOTTE
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David N. Pilotte
Chief Financial Officer