Recent studies have demonstrated that prompting large language models (LLM) with audio encodings enables effective speech recognition capabilities. However, the ability of Speech LLMs to comprehend and process multi-channel audio with spatial cues remains a relatively uninvestigated area of research. In this work, we present directional-SpeechLlama, a novel approach that leverages the microphone array of smart glasses to achieve directional speech recognition, source localization, and bystander cross-talk suppression. To enhance the model's ability to understand directivity, we propose two key techniques: serialized directional output training (S-DOT) and contrastive direction data augmentation (CDDA). Experimental results show that our proposed directional-SpeechLlama effectively captures the relationship between textual cues and spatial audio, yielding strong performance in both speech recognition and source localization tasks.