Document:

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                                                                   EXHIBIT 10.31

STATE OF NORTH CAROLINA

COUNTY OF DURHAM                                          FOURTH LEASE AMENDMENT

      THIS FOURTH LEASE AMENDMENT (the "Amendment") is entered into and
effective this 8th day of September 2003, by and between PROPERTY RESERVE,
INC, a Utah corporation (hereinafter "Landlord"), and DIGITAL RECORDERS, INC., a
North Carolina corporation (hereinafter, "Tenant").

                                    RECITALS:

      A.    The Prudential Savings Bank, F.S.B., as Trustee ("Prudential") and
Tenant entered into a Lease Agreement dated December 18, 1998, as amended by
First Lease Amendment dated December 11, 2002, and Second Lease Amendment dated
June 19, 2003, and Third Lease Amendment dated August 21, 2003, between
Landlord, successor in interest to Prudential's interest as landlord (as
amended, the "Lease"), for approximately thirty-one thousand one hundred
seventy-two (31,172) rentable square feet of space (the "Existing Premises")
being twenty-six thousand four hundred eighty-four (26,484) rentable square feet
located in Suite 100 at the east end and four thousand six hundred eighty-eight
rentable square feet (4,688 r.s.f.) at the west end of that certain building
known as 4018 Patriot Drive, Durham, Durham County North Carolina 27709 (the
"Building"), being part of that development known as One Park Center.

      B.    Landlord and Tenant now desire to modify and amend the Lease
pursuant to the terms and conditions contained herein.

                                   AGREEMENT:

      NOW, THEREFORE, for valuable consideration and ONE AND NO/100 DOLLARS
($1.00) paid by Tenant to Landlord, Landlord and Tenant agree that the Lease is
modified and amended as follows:

      1.    Commencing on the Additional Space Commencement Date, as defined
            herein, the Premises shall be expanded to include approximately four
            thousand four hundred sixteen rentable square feet (4,416 r.s.f)
            more or less, (the "Additional Space") adjacent to the portion
            occupied by Tenant on the east end of the Building, as shown on
            Exhibit A, attached hereto and incorporated herein by reference. As
            of the Additional Space Commencement Date, the Premises shall
            contain a total of thirty-five thousand five hundred eighty-eight
            rentable square feet (35,588 r.s.f.).

      2.    As of the Additional Space Commencement Date:

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            a.    Tenant's Pro Rata Share for operating expense pass throughs
                  and other purposes shall be recalculated based on the revised
                  square footage of the Premises; and

            b.    The Base Year Amount for determining operating expense pass
                  throughs attributable for the Additional Space incurred after
                  the Additional Space Commencement Date shall be the operating
                  expenses paid or incurred by Landlord for calendar year 2003.
                  The Base Year(s) for the Existing Space shall remain
                  unchanged; and

            c.    In addition to the Base Rent on the Existing Premises, Tenant
                  shall pay Base Rent on the Additional Space as follows:

 <TABLE>
 <CAPTION>
                                                           Installment of Monthly Base
                               Month                                  Rent
                               -----                                  ----
                  <S>                                      <C>
                  September___, 2003 * - April 30, 2004             $2,189.60
                      May 1, 1004 - April 30, 2005                  $2,255.84
                      May 1, 2006 - April 30, 2006                  $2,322.08
                      May 1, 2006 - April 30, 2007                  $2,392.00
                      May 1, 2007 - April 30, 2008                  $2,465,60
                      May 1, 2008 - April 30, 2009                  $2,539.20
</TABLE>

 * Monthly Base Rent for September 2003 will be prorated.

            d.    Any other sums calculated based on rentable square footage of
                  the Premises shall be recalculated based on 35,588 rentable
                  square feet. The provisions of Paragraph 3(h) of the Lease
                  limiting annual increases in Controllable Expenses shall not
                  limit increases arising from the increase in the rentable
                  square footage of the Premises.

            e.    Except as specifically modified hereby, all references to
                  "rent," "Base Rent," "operating expenses," and "additional
                  rent" shall be interpreted to apply as and to reflect the
                  revised square footage of the Premises.

      3.    The term of the Lease shall not be affected by this Fourth Lease
            Amendment; the Lease shall expire as of April 30, 2009, unless
            earlier terminated as set forth in the Lease.

      4.    The "Additional Space Commencement Date" shall mean the earlier of
            (i) September _, 2003 or (ii) Tenant's occupancy of any or all of
            the Additional Space.

      5.    Tenant has examined land inspected the Additional Space and accepts
            the Additional Space in all respects "AS IS" and "WHERE IS" subject
            to completion of the leasehold improvements as set forth on Exhibit
            B."

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      6.    Tenant understands and agrees that the services and utilities,
            including but not limited to electrical, gas, water and sewer which
            are provided to the 4,416 r.s,f. added by this Fourth Lease
            Amendment are separately metered. Tenant shall contract directly
            with the service provider for such services. Certain services or
            utilities on the meter may actually include a larger area already
            occupied by Tenant (for example under the First Lease Amendment or
            Second Lease Amendment).

      7.    Landlord acknowledges that it currently holds $15,422.38 as a
            Security Deposit pursuant to Paragraph 3(b) of the Lease. No
            additional Security Deposit is being required as part of this Fourth
            Lease Amendment.

      8.    Tenant acknowledges that its obligation to pay rent pursuant to the
            Fourth Lease Amendment shall commence on the Additional Space
            Commencement Date notwithstanding that the Landlord's Work set out
            on Exhibit B has not been done.

      9.    Tenant acknowledges that any guaranty, letter of credit, or other
            form of security which was intended to be applicable to the Existing
            Premises or Lease pursuant to Paragraph 3 of EXHIBIT D to the Lease
            shall also be applicable to the Additional Space and the Lease as
            amended by this Fourth Lease Amendment. Tenant agrees to deliver
            such documents or other items, signed by all appropriate parties as
            may be requested by Landlord to evidence this agreement.

      10.   Tenant represents and warrants to Landlord that Tenant has not
            entered into any agreements, nor will Tenant enter into any
            agreement in the future whereby Landlord would be obligated to pay
            any broker's commission or finder's fee in connection with Tenant's
            execution of this Fourth Lease Amendment. Tenant agrees to indemnify
            Landlord against, and to hold Landlord harmless from, all
            liabilities arising from any such claim.

      11.   Capitalized terms not defined herein shall have the same meaning as
            set forth in the Lease.

      12.   Except as specifically modified hereby, all the terms and provisions
            of the Lease shall remain in full force and effect and are hereby
            affirmed and ratified.

                                        3
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     IN WITNESS WHEREOF, Landlord and Tenant have executed this Fourth Lease
Amendment in triplicate originals, all as of the day and year first above
written.

                                  LANDLORD:

                                  PROPERTY RESERVE, INC.,
                                  a Utah corporation

                                  By:____________________________
                                  Name:__________________________
                                  Title:_________________________

                                  Date:__________________________

                                  TENANT:

                                  DIGITAL RECORDERS, INC.,
                                  a North Carolina corporation

                                  By:____________________________
                                  Name:__________________________
                                  Title:_________________________

                                  Date:__________________________

<PAGE>

                              SCHEDULE OF EXHIBITS

Exhibit A       Diagram showing Additional Space in relation to its location
                in the Building. Preferable to cross hatch Additional Space.

Exhibit B       Leasehold Improvements Exhibit

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                                   EXHIBIT A

                                  [FLOOR PLAN]

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                                    EXHIBIT B

                             Leasehold Improvements

Landlord shall, at Landlord's cost, perform the following work ("Landlord's
Work"):

(i)install a "1 hour" demising wall to separate the Premises from the adjacent
vacant space.

(ii) install a single door within the Premises to connect the portion of the
Premises originally leased to the space added by the First Lease Amendment,
the Second Lease Amendment and the Third Lease Amendment.

(iii) install 2,000 square feet of vinyl tile as agreed between Landlord and
Tenant.

Tenant acknowledges that the improvements (i) may be made in the Additional
Space and the Existing Premises on the east side of the Building as agreed by
Landlord and Tenant and (ii) will not be done as of the Additional Space
Commencement Date. Tenant grants, Landlord, its agents, employees and
contractors access to the Additional Space and the Existing Premises to perform
such work and shall not delay or hinder the performance of such work. Landlord's
work shall not constitute a nuisance or constructive eviction nor give Tenant
any right to abate or withhold rent. Landlord shall perform the work in a good
and workmanlike manner.<PAGE>

                                                                   EXHIBIT 10.32
                                FIRST AMENDMENT

      THIS FIRST AMENDMENT (the "Amendment") is made and entered into as of the
25th day of August, 2003, by and between STERLING PLAZA LIMITED PARTNERSHIP, a
DELAWARE LIMITED PARTNERSHIP, doing business in Texas as DALLAS STERLING PLAZA
LIMITED PARTNERSHIP ("Landlord"), and DIGITAL RECORDERS, INC. A NORTH CAROLINA
CORPORATION ("Tenant").

                                    RECITALS

A.    Landlord and Tenant are parties to that certain lease dated March 15,
      2000, which lease has been previously amended by instrument dated November
      2, 2000 (collectively, the "Lease"). Pursuant to the Lease, Landlord has
      leased to Tenant space currently containing approximately 2,206 rentable
      square feet (the "Premises") described as Suite No. 1050 on the 10th floor
      of the building located at 5949 Sherry Lane, Dallas, Texas 75225, and
      commonly known as Sterling Plaza (the "Building").

B.    The Lease by its terms shall expire on April 30, 2004 ("Prior Termination
      Date"), and the parties desire to extend the Term of the Lease, all on the
      following terms and conditions.

      NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:

I.    EXTENSION. The Term of the Lease is hereby extended for a period of 48
      months and shall expire on April 30, 2008 ("Extended Termination Date"),
      unless sooner terminated in accordance with the terms of the Lease. That
      portion of the Term commencing the day immediately following the Prior
      Termination Date ("Extension Date") and ending on the Extended Termination
      Date shall be referred to herein as the "Extended Term".

II.   BASE RENT. As of September 1, 2003, the schedule of Base Rent payable with
      respect to the Premises during the remainder of the Term and the Extended
      Term is the following:

<TABLE>
<CAPTION>
                         ANNUAL RATE            ANNUAL             MONTHLY
PERIOD                 PER SQUARE FOOT         BASE RENT          BASE RENT
------------           ---------------         -----------        ----------
<S>                    <C>                     <C>                <C>
September 1,
2003 - April
30, 2008                 $  22.00              $ 48,531.96        $ 4,044.33
</TABLE>

      All such Base Rent shall be payable by Tenant in accordance with the terms
      of the Lease.

III.  ADDITIONAL SECURITY DEPOSIT. No additional security deposit shall be
      required in connection with this Amendment.

IV.   EXPENSES AND TAXES. For the period commencing on the Extension Date and
      ending on the Extended Termination Date, Tenant shall pay for Tenant's Pro
      Rata Share of Expenses and Taxes in accordance with the terms of the
      Lease, provided, however, during such period, the Base Year for the
      computation of Tenant's Pro Rata Share of Expenses and Taxes is amended
      from 2000 to 2003.

V.    IMPROVEMENTS TO PREMISES.

      A.    CONDITION OF PREMISES. Tenant is in possession of the Premises and
            accepts the same "as is" without any agreements, representations,
            understandings or obligations on the part of Landlord to perform any
            alterations, repairs or improvements, except as may be expressly
            provided otherwise in this Amendment.

      B.    RESPONSIBILITY FOR IMPROVEMENTS TO PREMISES. Any construction,
            alterations or improvements to the Premises shall be performed by
            Tenant at its sole cost and expense using contractors selected by
            Tenant and approved by Landlord and shall be governed in all
            respects by the provisions of Article IX of the Lease.

                                       1
<PAGE>

VI.   OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
      of the date of this Amendment (unless different effective date(s) is/are
      specifically referenced in this Section), the Lease shall be amended in
      the following additional respects:

      A.    PARKING. As of September 1, 2003, Article I, "Parking" of Exhibit E,
            "Additional Provisions" to the Lease is hereby amended and modified
            by deleting the phrase "the sum of $50.00 per month per Permit" from
            the first sentence of paragraph B and inserting the following in
            lieu thereof: "the sum of $00.00 per month per Permit".

      B.    RIGHT OF FIRST REFUSAL.

            1.    Grant of Option; Conditions. Tenant shall have the one time
                  right of first refusal (the "Right of First Refusal") with
                  respect to the approximately 1,972 rentable square feet of
                  space known as Suite No. 1030 on the 10th floor of the
                  Building shown on the demising plan attached hereto as Exhibit
                  A (the "Refusal Space"). Tenant's Right of First Refusal shall
                  be exercised as follows: when Landlord has a prospective
                  tenant, other than the existing tenant in the Refusal Space,
                  (the "Prospect") interested in leasing the Refusal Space,
                  Landlord shall advise Tenant (the "Advice") of the terms under
                  which Landlord is prepared to lease the Refusal Space to such
                  Prospect and Tenant may lease the Refusal Space, under such
                  terms, by providing Landlord with written notice of exercise
                  (the "Notice of Exercise") within 5 days after the date of the
                  Advice, except that Tenant shall have no such Right of First
                  Refusal and Landlord need not provide Tenant with an Advice
                  if:

                  a.    Tenant is in default under the Lease beyond any
                        applicable cure periods at the time that Landlord would
                        otherwise deliver the Advice; or

                  b.    the Premises, or any portion thereof, is sublet (other
                        than pursuant to a Permitted Transfer, as defined in
                        Article XII of the Lease) at the time Landlord would
                        otherwise deliver the Advice; or

                  c.    the Lease has been assigned (other than pursuant to a
                        Permitted Transfer, as defined in Article XII of the
                        Lease) prior to the date Landlord would otherwise
                        deliver the Advice; or

                  d.    the Refusal Space is not intended for the exclusive use
                        of Tenant during the Term; or

                  e.    the Tenant is not occupying the Premises on the date
                        Landlord would otherwise deliver the Advice.

            2.    Terms for Refusal Space.

                  a.    The term for the Refusal Space shall commence upon the
                        commencement date stated in the Advice and thereupon
                        such Refusal Space shall be considered a part of the
                        Premises, provided that all of the terms stated in the
                        Advice, including the termination date set forth in the
                        Advice, shall govern Tenant's leasing of the Refusal
                        Space and only to the extent that they do not conflict
                        with the Advice, the terms and conditions of the Lease
                        shall apply to the Refusal Space. Tenant shall pay Base
                        Rent and Additional Rent for the Refusal Space in
                        accordance with the terms and conditions of the Advice.

                  b.    The Refusal Space (including improvements and
                        personality, if any) shall be accepted by Tenant in its
                        condition and as-built configuration existing on the
                        earlier of the date Tenant takes possession of the
                        Refusal Space or the date the term for such Refusal
                        Space commences, unless the Advice specifies work to be
                        performed by Landlord in the Refusal Space, in which
                        case Landlord shall perform such work in the Refusal
                        Space. If Landlord is delayed delivering possession of
                        the Refusal Space due to the holdover or unlawful
                        possession of such space by any party, Landlord shall
                        use reasonable efforts to obtain possession of the
                        space, and the commencement of the term for the Refusal

                                       2
<PAGE>

                        Space shall be postponed until the date Landlord
                        delivers possession of the Refusal Space to Tenant free
                        from occupancy by any party.

            3.    Termination of Right of First Refusal. The rights of Tenant
                  hereunder with respect to the Refusal Space shall terminate on
                  the earlier to occur of (i) April 30, 2007; (ii) Tenant's
                  failure to exercise its Right of First Refusal within the 5
                  day period provided in Section 1 above; and (iii) the date
                  Landlord would have provided Tenant an Advice if Tenant had
                  not been in violation of one or more of the conditions set
                  forth in Section 1 above.

            4.    Refusal Space Amendment. If Tenant exercises its Right of
                  First Refusal, Landlord shall prepare an amendment (the
                  "Refusal Space Amendment") adding the Refusal Space to the
                  Premises on the terms set forth in the Advice and reflecting
                  the changes in the Base Rent, Rentable Square Footage of the
                  Premises, Tenant's Pro Rata Share and other appropriate terms.
                  A copy of the Refusal Space Amendment shall be sent to Tenant
                  within a reasonable time after Landlord's receipt of the
                  Notice of Exercise executed by Tenant, and Tenant shall
                  execute and return the Refusal Space Amendment to Landlord
                  within 15 days thereafter, but an otherwise valid exercise of
                  the Right of First Refusal shall be fully effective whether or
                  not the Refusal Space Amendment is executed.

            5.    Subordination. Notwithstanding anything herein to the
                  contrary, Tenant's Right of First Refusal is subject and
                  subordinate to (i) the renewal or extension rights of any
                  tenant leasing all or any portion of the Refusal Space, and
                  (ii) the expansion rights (whether such rights are designated
                  as a right of first offer, right of first refusal, expansion
                  option or otherwise) of any tenant of the Building existing on
                  the date hereof.

VII.  MISCELLANEOUS.

      A.    This Amendment sets forth the entire agreement between the parties
            with respect to the matters set forth herein. There have been no
            additional oral or written representations or agreements. Under no
            circumstances shall Tenant be entitled to any Rent abatement,
            improvement allowance, leasehold improvements, or other work to the
            Premises, or any similar economic incentives that may have been
            provided Tenant in connection with entering into the Lease, unless
            specifically set forth in this Amendment.

      B.    Except as herein modified or amended, the provisions, conditions and
            terms of the Lease shall remain unchanged and in full force and
            effect.

      C.    In the case of any inconsistency between the provisions of the Lease
            and this Amendment, the provisions of this Amendment shall govern
            and control.

      D.    Submission of this Amendment by Landlord is not an offer to enter
            into this Amendment but rather is a solicitation for such an offer
            by Tenant. Landlord shall not be bound by this Amendment until
            Landlord has executed and delivered the same to Tenant.

      E.    The capitalized terms used in this Amendment shall have the same
            definitions as set forth in the Lease to the extent that such
            capitalized terms are defined therein and not redefined in this
            Amendment.

      F.    Tenant hereby represents to Landlord that Tenant has dealt with no
            broker, other than Jon White ("Broker") in connection with this
            Amendment. Tenant agrees to indemnify and hold Landlord, its
            members, principals, beneficiaries, partners, officers, directors,
            employees, mortgagee(s) and agents, and the respective principals
            and members of any such agents (collectively, the "Landlord Related
            Parties") harmless from all claims of any brokers, other than
            Broker, claiming to have represented Tenant in connection with this
            Amendment. Landlord hereby represents to Tenant that Landlord has
            dealt with no broker in connection with this Amendment. Landlord
            agrees to indemnify and hold Tenant, its members, principals,
            beneficiaries, partners, officers, directors, employees, and agents,
            and the respective principals and members of any such agents
            (collectively, the "Tenant Related Parties") harmless from all
            claims of any brokers claiming to have represented Landlord in
            connection with this Amendment.

                                       3
<PAGE>

      G.    Each signatory of this Amendment represents hereby that he or she
            has the authority to execute and deliver the same on behalf of the
            party hereto for which such signatory is acting.

      IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.

                                     LANDLORD:

                                     STERLING PLAZA LIMITED PARTNERSHIP, A
                                     DELAWARE LIMITED PARTNERSHIP, DOING
                                     BUSINESS IN TEXAS AS DALLAS STERLING
                                     PLAZA LIMITED PARTNERSHIP

                                     By: TX-Sterling Plaza Limited
                                         Partnership, a Delaware limited
                                         partnership, its general partner

                                         By: TX-Sterling Plaza GP, L.L.C., a
                                             Delaware limited liability
                                             company, its general partner

                                             By: Equity Office Management,
                                                 L.L.C., a Delaware limited
                                                 liability company, its non-
                                                 member manager

                                                 By: /s/ Brad Fricks
                                                     ---------------------------
                                                 Name:  Brad Fricks

                                                 Title: Vice President - Leasing

                                     TENANT:

                                     DIGITAL RECORDERS, INC. A NORTH CAROLINA
                                     CORPORATION

                                     By: /s/ David L. Turney
                                         ---------------------------------------
                                     Name:  David L. Turney

                                     Title: President, CEO, Chairman

                                       4

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