Exhibit 4.2
AMENDMENT AGREEMENT
THIS AGREEMENT dated the 3rd day of February, 2005 (the "Agreement Date")
BETWEEN:
XXXXX XXXXX, businessman, of 00000 - 000xx Xxxxxx, Xxxxx Xxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Manager")
OF THE FIRST PART
AND:
SMARTIRE SYSTEMS INC., a company duly incorporated pursuant to the
laws of the Province of British Columbia, having an office at 150 -
13151 Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
("SmarTire" or the "Company")
OF THE SECOND PART
A. The Manager and SmarTire entered into a management agreement (the
"Management Agreement") dated May 1, 2002 whereby SmarTire appointed the Manager
as an officer of SmarTire;
B. SmarTire and the Manager wish to amend the terms of the Management
Agreement on the terms and conditions set forth herein.
THEREFORE, in consideration of the mutual covenants and premises contained
herein, and payment of $10, the receipt and sufficiency of which is hereby
acknowledged, the parties covenant and agree as follows:
1. DEFINITIONS
1.1 In this Amendment Agreement, the following terms have the meaning as
ascribed below:
(a) "Acquisition" means an acquisition of substantially all of
SmarTire or of substantially all assets of SmarTire by a party
not an Affiliate of SmarTire prior to completion of the
acquisition;
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(b) "Affiliate" means a director, officer, wholly or partially
owned subsidiary or 10% or greater shareholder of SmarTire, or
a company controlled by such person or any party acting in
conjunction with such person;
(c) "Hostile Takeover" means a Takeover that the directors of
SmarTire recommend to shareholders to reject in a management
circular;
(d) "Merger" means a merger by SmarTire with a corporation that
was not an Affiliate prior to completion of the merger;
(e) "Takeover" means a successful tender offer (as that term is
determined by reference to the United States Securities
Exchange Act of 1934) or takeover bid (as that term is defined
in the Securities Act (British Columbia)) that has been made
by a party who was not an Affiliate prior to the completion of
the tender offer or takeover;
(f) "Termination Date" means the date which is one (1) year from
the date of termination plus one month for each year of the
Manager's employment with SmarTire to a maximum of two and a
half (2.5) years.
2. TERMINATION PROVISIONS AMENDED
2.1 The following is added to section 7.3 of the Agreement, entitled
"Termination by Company", and shall be construed and interpreted in accordance
with this Amendment Agreement:
2.2 "Notwithstanding anything else in this Agreement, in the event that
the employment of the Manager under the Agreement is terminated within eighteen
(18) months of an Acquisition, a Hostile Takeover or a Merger and the
termination is without cause, the Company, at its option, will either (a)
continue to pay the salary under the Agreement and provide the benefits under
the Agreement until the Termination Date or (b) pay upon termination an amount
equal to the salary payable to the Termination Date in lieu of notice. Any stock
options that have been granted but that have not yet vested shall immediately
vest at the date of the final payment, and may be exercised for a period of 30
days only after the final payment."
3. GENERAL
3.1 In all other respects, the Agreement shall remain in full force and
effect.
3.2 This Agreement will enure to the benefit of and be binding upon the
parties and their respective successors and permitted assigns.
3.3 This Agreement will be governed by and construed in accordance with
the laws of British Columbia.
3.4 This Agreement may be executed in several counterparts, each of which
will be deemed to be an original and all of which will together constitute one
and the same instrument.
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3.5 Except as expressly amended by this Agreement, the Management
Agreement is hereby ratified and confirmed.
IN WITNESS WHEREOF the parties have executed this Agreement as of the date first
above written.
SIGNED, SEALED and DELIVERED by XXXXX XXXXX in the )
presence of: )
)
/s/ Xxxx Xxxxxxxxxxx )
-------------------- )
Signature )
Xxxx Xxxxxxxxxxx ) /s/ Xx Xxxxx
---------------- )
Print Name ) XXXXX XXXXX
Suite 150 - 13151 Vanier Place )
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Address )
Xxxxxxxx, X.X. X0X 0X0 )
)
C.A. )
---- )
Occupation )
SMARTIRE SYSTEMS INC.
Per: /s/ Xxxx Xxxxxxxxxxx
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Authorized Signatory
Title: Chief Financial Officer
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