DRI CORP

(11) SHAREHOLDERS’ EQUITY, COMPREHENSIVE INCOME (LOSS) AND NONCONTROLLING INTEREST

     Set forth below is a reconciliation of shareholders’ equity attributable to the Company and total noncontrolling interest at the beginning and end of the nine months ended September 30, 2011 and 2010 (in thousands).

		DRI Shareholders’ Equity
																		Accumulated
										Additional				Accum-				Other				Total DRI								Compre-				Total
		Preferred				Common				Paid-in				ulated				Comprehensive				Shareholders’				Noncontrolling				hensive				Shareholders’
		Stock				Stock				Capital				Deficit				Income				Equity				Interest				Income (loss)				Equity
Balance as of December 31, 2010		$	5,854			$	1,184			$	30,374			$	(20,121	)		$	3,180			$	20,471			$	847							$	21,318
Issuance of common stock							10				109												119												119
Conversion of Series AAA Preferred Stock			(30	)			1				29												—												—
Preferred stock dividends											(541	)											(541	)											(541	)
Stock-based compensation expense											265												265												265
Comprehensive income (loss):
Net loss															(9,846	)							(9,846	)			(158	)		$	(10,004	)			(10,004	)
Translation adjustment																			231				231								231				231
Total comprehensive loss																														$	(9,773	)
Balance as of September 30, 2011		$	5,824			$	1,195			$	30,236			$	(29,967	)		$	3,411			$	10,699			$	689							$	11,388

		DRI Shareholders’ Equity
																		Accumulated
										Additional				Accum-				Other				Total DRI								Compre-				Total
		Preferred				Common				Paid-in				ulated				Comprehensive				Shareholders’				Noncontrolling				hensive				Shareholders’
		Stock				Stock				Capital				Deficit				Income				Equity				Interest				Income				Equity
Balance as of December 31, 2009		$	4,923			$	1,175			$	30,393			$	(18,276	)		$	1,976			$	20,191			$	755							$	20,946
Issuance of common stock							5				86												91												91
Issuance of Series K preferred stock, net of issuance costs			683																				683												683
Issuance of Series G preferred stock dividend			190																				190												190
Issuance of Series H preferred stock dividend			20																				20												20
Conversion of Series K Preferred Stock, net of issuance costs			(67	)			4				63												—												—
Preferred stock dividends											(381	)											(381	)											(381	)
Stock-based compensation expense											279												279												279
Comprehensive income (loss):
Net Income (loss)															(396	)							(396	)			524			$	128				128
Translation adjustment																			1,322				1,322								1,322				1,322
Total comprehensive income																														$	1,450
Balance as of September 30, 2010		$	5,749			$	1,184			$	30,440			$	(18,672	)		$	3,298			$	21,999			$	1,279							$	23,278

COMPREHENSIVE INCOME (LOSS)

		Three Months Ended September 30,								Nine Months Ended September 30,
		2011				2010				2011				2010
		(In thousands)								(In thousands)
Net income (loss)		$	45			$	(190	)		$	(10,004	)		$	128
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment, net of tax			(1,135	)			2,758				231				1,322
Total other comprehensive income (loss), net of tax			(1,135	)			2,758				231				1,322
Comprehensive income (loss)			(1,090	)			2,568				(9,773	)			1,450
Comprehensive (income) loss attributable to the noncontrolling interest			133				(219	)			151				(623	)
Comprehensive income (loss) attributable to DRI Corporation		$	(957	)		$	2,349			$	(9,622	)		$	827