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                                                                    Exhibit 10.2


                              MANAGEMENT AGREEMENT


THIS AGREEMENT effective as of the 23rd day of October, 2002 (the "Effective
Date").

BETWEEN:

          SMARTIRE SYSTEMS INC., a company duly incorporated pursuant
          to the laws of the Province of British Columbia, having an
          office at 150 - 13151 Vanier Place, Richmond, British
          Columbia, V6V 2J1

          (hereinafter referred to as the "Company")

                                                               OF THE FIRST PART

AND:

          JEFF A. FINKELSTEIN, businessman, of 2208 Portside Court,
          Vancouver, British Columbia, V5P 4V1

          (hereinafter referred to as the "Manager")

                                                              OF THE SECOND PART


RECITALS

WHEREAS the Company has requested the assistance of the Manager in providing
certain management services to the Company, as hereinafter described;

WHEREAS the Manager has agreed to provide such assistance and services to the
Company in accordance with the terms and conditions herein set forth;

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants set forth below, the parties hereto agree as follows:

1       DUTIES AND DEVOTION OF TIME

1.1     Duties. During the term of this Agreement the Manager shall be
responsible for the duties contained in Schedule "A" attached hereto and
incorporated herein by this reference (the "Duties").

1.2     Devotion of Time. The parties hereto acknowledge and agree that the work
of the Manager is and shall be of such a nature that regular hours may not be
sufficient and



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occasions may arise whereby the Manager shall be required to work more than
eight (8) hours per day and/or five (5) days per week. The Manager agrees that
the consideration set forth herein shall be in full and complete satisfaction
for such work and services, regardless of when and where such work and services
are performed. The Manager further releases the Company from any claims for
overtime pay or other such compensation which may accrue to the Manager.
Notwithstanding the foregoing, the Company agrees that so long as the Manager
properly discharges his duties hereunder, the Manager may devote the remainder
of his time and attention to other non-competing business and personal pursuits.

1.3     Business Opportunities the Property of the Company. The Manager agrees
to communicate immediately to the Company all business opportunities, inventions
and improvements in the nature of the business of the Company which, during the
term of this Agreement, the Manager may conceive, make or discover, become aware
of, directly or indirectly, or have presented to him in any manner which relates
in any way to the Company, either as it is now or as it may develop, and such
business opportunities, inventions or improvements shall become the exclusive
property of the Company without any obligation on the part of the Company to
make any payments therefor in addition to the salary and benefits herein
described to the Manager.

1.4     No Personal Use. The Manager shall not use any of the work the Manager
shall perform for the Company for any personal purposes without first obtaining
the prior written consent of the Company.

2       SALARY, BONUSES AND BENEFITS

2.1     Salary. In consideration of the Manager providing the services referred
to herein, the Company agrees to pay the Manager an annual base salary (the
"Annual Base Salary") of one hundred and twenty thousand dollars ($120,000) less
applicable deductions, payable bi-weekly, subject to increase as from time to
time approved by the Board of Directors of the Company.

2.2     Benefits. The Company shall provide, maintain and pay for:

        (a)   medical, dental for the Manager and his immediate family as is
              provided by the Company's medical services plan or an equivalent
              plan; and

        (b)   such extended health and other benefits for the Manager and his
              immediate family as are provided to employees of the Company,
              subject to the eligibility of the Manager.

2.3     Payment in Cash or Shares. All payments payable by the Company to the
Manager, including the Annual Base Salary and reimbursement of expenses under
Section 4.1 hereof, may be payable in cash or, at the election of the Manager,
with approval by the Board of Directors, and subject to the approval of the
regulatory authorities, such will be paid in whole or in part in common shares
in the capital stock of the Company ("Remuneration Shares"), issued at


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the 5 day average closing price (for the 5 days prior to the Manager's election)
of the Company's common shares on any stock exchange or quotation system upon
which the Company's common shares are listed for trading.

2.4     Registration of Performance Bonus Shares. To ensure that any shares
issued to the Manager under paragraph 2.3 of this Agreement are freely tradable,
the Company shall register with the SEC any such shares issued. Upon or as soon
as is practical after the issuance of such shares, the Company shall file a form
S-8 or other appropriate form with the United States Securities and Exchange
Commission (the "SEC) to effect registration.

2.5     Incentive Stock Options. The Company hereby agrees to grant to the
Manager a total of Seventy Thousand (70,000) stock options (the "Options"), each
entitling the Manager to purchase one common share in the capital of the
Company, as follows:

        (a)   Forty Thousand (40,000) Options will be granted pursuant to a
              stock option agreement to be entered into between the Company and
              the Manager as at October 23, 2002 (the "Initial Grant Date")
              pursuant to the Company's 1998 Stock Incentive Plan (Non-U.S.)
              (the "1998 Plan"), and will be subject to the following terms and
              conditions:

              (i)    Twenty-Three Thousand Three Hundred and Thirty-Four
                     (23,334) Options will vest immediately upon issuance at an
                     exercise price of U.S.$1.00 per share, which price is
                     hereby acknowledged by the parties to be equal to the Fair
                     Market Value (as defined in the 1998 Plan) of a share of
                     the Company's common stock as at the Initial Grant Date,
                     but not less than U.S. $1.00; and

              (ii)   Sixteen Thousand Six Hundred and Sixty-Six (16,666) Options
                     will vest on October 23, 2003 at an exercise price of
                     U.S.$1.20 per share.

        (b)   Subject to paragraph 2.5(d) hereof, Thirty Thousand (30,000)
              Options will be granted pursuant to a stock option agreement (the
              "Deferred Stock Option Agreement") to be entered into between the
              Company and the Manager pursuant to a new [non-U.S.] Stock
              Incentive Plan proposed to be adopted by the Company (the "2002
              Plan"), and will be subject to the following terms and conditions:

              (i)    Six Thousand Six Hundred and Sixty-Seven (6,667) Options
                     will vest on October 23, 2003 at an exercise price per
                     share equal to U.S.$1.20 (the "Base Exercise Price"); and

              (ii)   Twenty-Three Thousand Three Hundred and Thirty-Three
                     (23,333) Options will vest on October 23, 2004 at an
                     exercise price per share equal to One Hundred and Twenty
                     Percent (120%) of the Base Exercise Price;

        (c)   the Options will terminate, to the extent not previously
              exercised, at 5:00 p.m. (Vancouver time) on October 23, 2007; and


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        (d)   The Manager hereby acknowledges and agrees that the Company shall
              be precluded from entering into the Deferred Stock Option
              Agreement, and shall be released from any obligation to do so, if
              the adoption of the 2002 Plan by the Company is not approved by
              the members of the Company in accordance with the applicable
              NASDAQ Marketplace Rules at the next annual general meeting of the
              Company.

3       VACATION

3.1     Entitlement to Vacation. The Company acknowledges that the Manager shall
be entitled to an annual vacation of four (4) weeks. The Manager shall use his
best efforts to ensure that such vacation is arranged with the Company in
advance such that his vacation does not unduly affect the operations of the
Company.

3.2     Increase in Vacation. The period set out in Section 3.1 above may be
increased from time to time as mutually agreed to by the Manager and the
Company's Board of Directors.

4       REIMBURSEMENT OF EXPENSES

4.1     Reimbursement of Expenses. The Manager shall be reimbursed for all
reasonable out-of-pocket expenses incurred by the Manager in or about the
execution of the Duties contained herein, including without limiting the
generality of the foregoing, all reasonable travel and promotional expenses
payable or incurred by the Manager in connection with the Duties under this
Agreement. All payments and reimbursements shall be made within two (2) weeks of
submission by the Manager of vouchers, bills or receipts for such expenses.

5       CONFIDENTIAL INFORMATION

5.1     Confidential Information. The Manager shall not, either during the term
of this Agreement or under the provisions of Section 5.3, without specific
consent in writing, disclose or reveal in any manner whatsoever to any other
person, firm or corporation, nor will he use, directly or indirectly, for any
purpose other than the purposes of the Company, the private affairs of the
company or any confidential information which he may acquire during the term of
this Agreement with relation to the business and affairs of the directors and
shareholders of the Company, unless the Manager is ordered to do so by a court
of competent jurisdiction or unless required by any statutory authority.

5.2     Non-Disclosure Provisions. The foregoing provision shall be subject to
the further non-disclosure provisions contained in Schedule "B" attached hereto
and incorporated hereinafter by this reference.

5.3     Provisions Survive Termination. The provisions of this section shall
survive the termination of this Agreement for a period of three years.


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6       TERM

6.1     Term. This Agreement shall remain in effect until terminated in
accordance with any of the provisions contained in this Agreement.

7       TERMINATION

7.1     Termination by Manager. Notwithstanding any other provision contained
herein, the parties hereto agree that the Manager may terminate this Agreement,
with or without cause, by giving ninety (90) days' written notice of such
intention to terminate.

7.2     Resignation or Cessation of Duties. In the event that the Manager ceases
to perform all of the Duties contained herein, other than by reason of the
Manager's death or disability, or if the Manager resigns unilaterally and on his
own initiative from all of his positions this Agreement shall be deemed to be
terminated by the Manager as of the date of such cessation of Duties or such
resignation, and the Company shall have no further obligations under Section 2
hereof.

7.3     Termination by Company. The Company may terminate this Agreement at any
time for just cause without further obligation. In the event of termination for
any reason other than for just cause within six (6) months of the effective date
of this Agreement, the Company, at its option, will either (a) continue to pay
the salary under Clause 2.1 and provide benefits under Clauses 2.2 until three
(3) months from the date of termination or (b) pay three (3) months' salary
under Clause 2.1 in lieu of notice. In the event of termination for any reason
other than for just cause six (6) months after the effective date of this
Agreement, but within twelve (12) months of the effective date of this
Agreement, the Company, at its option, will either (a) continue to pay the
salary under clause 2.1 and provide the benefits under Clauses 2.2 until six (6)
months from the date of termination or (b) pay six (6) months' salary under
Clause 2.1 in lieu of notice. In the event of termination for any reason other
than for just cause twelve (12) months after the effective date of this
Agreement, but within twenty-four (24) months of the effective date of this
Agreement, the Company, at its option, will either (a) continue to pay the
salary under clause 2.1 and provide the benefits under Clauses 2.2 until nine
(9) months from the date of termination or (b) pay nine (9) months' salary under
Clause 2.1 in lieu of notice. In the event of termination for any reasons other
than for just cause twenty-four (24) months after the effective date of this
Agreement, the Company, at its option, will either (a) continue to pay the
salary under Clause 2.1 and provide the benefits under Clauses 2.2 until twelve
(12) months from the date of termination or (b) pay twelve (12) months' salary
under Clause 2.1 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.

7.4     Death. In the event of the death of the Manager during the term of this
Agreement, this Agreement shall be terminated as of the date of such death, and
the Manager's

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spouse, if living, or surviving children shall be entitled to the termination
allowance stated in Section 7.3 hereof.

7.5     Disability. In the event that the Manager will during the term of this
Agreement by reason of illness or mental or physical disability or incapacity be
prevented from or incapable of performing the Duties hereunder, then the Manager
shall be entitled to receive the remuneration provided for herein at the rate
specified hereinbefore for the period during which such illness, disability or
incapacity will continue, but not exceeding six (6) successive months. If such
illness, disability or incapacity continues or will continue for a period longer
than six (6) successive months, then this Agreement may, at the option of the
Directors of the Company, forthwith be terminated, and the Manager shall be
entitled to the termination allowance stated in Section 7.3 hereof.

7.6     Termination Payments. Any payments made by the Company to the Manager
upon the termination of this Agreement shall be made in cash, or, if the Company
does not have available funds, in equal monthly cash instalments over one year,
or in Remuneration Shares, or in a combination of cash and Remuneration Shares,
subject to regulatory approval. All payments required to be made by the Company
to the Manager pursuant to Section 7 hereof shall be made in full.

8       RIGHTS AND OBLIGATIONS UPON TERMINATION

8.1     Rights and Obligations. Upon termination of this Agreement, the Manager
shall deliver up to the Company all documents, papers, plans, materials and
other property of or relating to the affairs of the Company, other than the
Manager's personal papers in regard to his role in the Company, which may then
be in the Manager's possession or under his control.

9       CLOSING

9.1     Closing Date. This Agreement shall be effective as of October 23, 2002.

9.2     Conditions of Closing. The parties hereto agree that it shall be a
condition of the execution of this Agreement that prior to or contemporaneously
with the execution of this Agreement:

        (a)   this Agreement shall be approved by the Board of Directors of the
              Company.

10      NOTICES AND REQUESTS

10.1    Notices and Requests. All notices and requests in connection with this
Agreement shall be deemed given as of the day they are received either by
messenger, delivery service, or mailed by registered or certified mail with
postage prepaid and return receipt requested and addressed as follows:


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        (a)   if to the Company:

              SmarTire Systems Inc.
              150 - 13151 Vanier Place
              Richmond, British Columbia
              V6V 2J1

              with a copy to:

              CLARK, WILSON
              Suite 800-885 West Georgia Street
              Vancouver, British Columbia
              V6C 3H1

              Attention:  Bernard Pinsky

        (b)   If to the Manager:

              Jeff Finkelstein
              2208 Portside Court
              Vancouver, BC
              V5P 4V1

or to such other address as the party to receive notice or request so designates
by written notice to the others.

11      INDEPENDENT PARTIES

11.1    Independent Parties. This Agreement is intended solely as a management
services agreement and no partnership, agency, joint venture, distributorship or
other form of agreement is intended.

12      AGREEMENT VOLUNTARY AND EQUITABLE

12.1    Agreement Voluntary. The parties acknowledge and declare that in
executing this Agreement they are each relying wholly on their own judgement and
knowledge and have not been influenced to any extent whatsoever by any
representations or statements made by or on behalf of any other party regarding
any matters dealt with herein or incidental thereto.

12.2    Agreement Equitable. The parties further acknowledge and declare that
they each have carefully considered and understand the provisions contained
herein, including, but without limiting the generality of the foregoing, the
Manager's rights upon termination and the restrictions on the Manager after
termination and agree that the said provisions are mutually fair and equitable,
and that they executed this Agreement voluntarily and of their own free will.


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13      CONTRACT NON-ASSIGNABLE; INUREMENT

13.1    Contract Non-Assignable. This Agreement and all other rights, benefits
and privileges contained herein may not be assigned by the Manager.

13.2    Inurement. The rights, benefits and privileges contained herein,
including without limitation the benefits of Sections 2 and 7 hereof, shall
inure to the benefit of and be binding upon the respective parties hereto, their
heirs, executors, administrators and successors.

14      ENTIRE AGREEMENT

14.1    Entire Agreement. This Agreement represents the entire Agreement between
the parties and supersedes any and all prior agreements and understandings,
whether written or oral, among the parties. The Manager acknowledges that he was
not induced to enter into this Agreement by any representation, warranty,
promise or other statement, except as contained herein.

14.2    Previous Agreements Cancelled. Save and except for the express
provisions of this Agreement, any and all previous agreements, written or oral,
between the parties hereto or on their behalf relating to the services of the
Manager for the Company are hereby terminated and cancelled and each of the
parties hereby releases and further discharges the other of and from all manner
of actions, causes of action, claims and demands whatsoever under or in respect
of any such agreements.

15      WAIVER

15.1    Waiver. No consent or waiver, express or implied, by either party to or
of any breach or default by the other party in the performance by the other of
its or his obligations herein shall be deemed or construed to be a consent or
waiver to or of any breach or default of the same or any other obligation of
such party. Failure on the part of either party to complain of any act or
failure to act, or to declare the other party in default irrespective of how
long such failure continues, shall not constitute a waiver by such party of its
or his rights herein or of the right to then or subsequently declare a default.

16      SEVERABILITY

16.1    Severability. If any provision contained herein is determined to be void
or unenforceable in whole or in part, it is to that extent deemed omitted. The
remaining provisions shall not be affected in any way.

17      AMENDMENT

17.1    Amendment. This Agreement shall not be amended or otherwise modified
except by a written notice of even date herewith or subsequent hereto signed by
both parties.


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18      HEADINGS

18.1    Headings. The headings of the sections and subsections herein are for
convenience only and shall not control or affect the meaning or construction of
any provisions of this Agreement.

19      GOVERNING LAW

19.1    Governing Law. This Agreement shall be construed under and governed by
the laws of the Province of British Columbia and the laws of Canada applicable
therein.

20      EXECUTION

20.1    Execution in Several Counterparts. This Agreement may be executed by
facsimile and in several counterparts, each of which shall be deemed to be an
original and all of which shall together constitute one and the same instrument.


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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
23rd day of October, 2002.

SMARTIRE SYSTEMS INC.

Per:   /s/Robert Rudman
       -------------------------
       Authorized Signatory

SIGNED by JEFF A. FINKELSTEIN in the presence of:   )
                                                    )
/s/Lisa Yahov                                       )
-------------                                       )
Name                                                )
1771 Westover Rd. Vancouver, B.C.                   )
---------------------------------                   )
Address                                             )     /s/Jeff Finkelstein
                                                    )    -------------------
--------------------------------------              )     JEFF A. FINKELSTEIN
                                                    )
H.R. Manager                                        )
------------                                        )
Occupation                                          )
                                                    )



This is page 10 of Agreement dated above for reference the 23rd day of October,
2002.


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                                  SCHEDULE "A"

                                MANAGER'S DUTIES

1.      The Manager shall be appointed as the Chief Financial Officer and
Corporate Secretary of the Company, and the Manager shall faithfully, honestly
and diligently serve the Company and each of the Company's subsidiaries.

2.      To create value for the Company's shareholders by managing the financial
interests of the Company and performing the functions of Corporate Secretary.

3.      The Manager shall be responsible for managing the Company's capital and
assuring that the Company's capital is used efficiently. The Manager shall be
responsible for leading the financial policy making and contributing to
corporate planning for the Company and each of the Company's subsidiaries. The
Manager shall be responsible for corporate secretary functions, assuring that
proper procedure, filing and record keeping are followed to meet stock exchange
and corporate legal requirements. The Manager shall report to the Chief
Operating Officer of the Company and may be appointed to additional
responsibilities as deemed appropriate by the Chief Operating Officer.


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                                  SCHEDULE "B"

                            NON-DISCLOSURE PROVISIONS

1.      CONFIDENTIAL INFORMATION AND MATERIALS

        (a)   "Confidential Information" shall mean, for the purposes of this
              Agreement, non-public information which the Company designates as
              being confidential or which, under the circumstances surrounding
              disclosure ought reasonably to be treated as confidential.
              Confidential Information includes, without limitation,
              information, whether written, oral or communicated by any other
              means, relating to released or unreleased Company software or
              hardware products, the marketing or promotion of any product of
              the Company, the Company's business policies or practices, and
              information received from others which the Company is obliged to
              treat as confidential. Confidential Information disclosed to the
              Manager by any subsidiary and/or agents of the Company is covered
              by this Agreement.

        (b)   Confidential Information shall not include that information
              defined as Confidential Information hereinabove which the Manager
              can exclusively establish:

              (i)    is or subsequently becomes publicly available without
                     breach of any obligation of confidentiality owed to the
                     Company;

              (ii)   became known to the Manager prior to disclosure by the
                     Company to the Manager;

              (iii)  became known to the Manager from a source other than the
                     Company other than by the breach of any obligations of
                     confidentiality owed to the Company; or

              (iv)   is independently developed by the Manager.

        (c)   Confidential Materials shall include all tangible materials
              containing Confidential Information, including, without
              limitation, written or printed documents and computer disks or
              tapes, whether machine or user readable.

2.      RESTRICTIONS

        (a)   The Manager shall not disclose any Confidential Information to
              third parties for a period of three (3) years following the
              termination of this Agreement, except as provided herein. However,
              the Manager may disclose Confidential Information during bona fide
              execution of the Duties or in accordance with judicial or other
              governmental order, provided that the Manager shall give


<PAGE>

              reasonable notice to the Company prior to such disclosure and
              shall comply with any applicable protective order or equivalent.

        (b)   The Manager shall take reasonable security precautions, at least
              as great as the precautions he takes to protect his own
              confidential information, to keep confidential the Confidential
              Information, as defined hereinabove.

        (c)   Confidential Information and Materials may be disclosed,
              reproduced, summarized or distributed only in pursuance of the
              business relationship of the Manager with the Company, and only as
              provided hereunder.

3.      RIGHTS AND REMEDIES

        (a)   The Manager shall notify the Company immediately upon discovery of
              any unauthorized use or disclosure of Confidential Information or
              Materials, or any other breach of this Agreement by the Manager,
              and shall co-operate with the Company in every reasonable manner
              to aid the Company to regain possession of said Confidential
              Information or Materials and prevent all such further unauthorized
              use.

        (b)   The Manager shall return all originals, copies, reproductions and
              summaries of or relating to the Confidential Information at the
              request of the Company or, at the option of the Company, certify
              destruction of the same.

        (c)   The parties hereto recognize that a breach by the Manager of any
              of the provisions contained herein would result in damages to the
              Company and that the Company could not be compensated adequately
              for such damages by monetary award. Accordingly, the Manager
              agrees that in the event of any such breach, in addition to all
              other remedies available to the Company at law or in equity, the
              Company shall be entitled as a matter of right to apply to a court
              of competent jurisdiction for such relief by way of restraining
              order, injunction, decree or otherwise, as may be appropriate to
              ensure compliance with the provisions of this Agreement.

4.      MISCELLANEOUS

        (a)   All Confidential Information and Materials are and shall remain
              the property of the Company. By disclosing information to the
              Manager, the Company does not grant any express or implied right
              to the Manager to or under any and all patents, copyrights,
              trademarks, or trade secret information belonging to the Company.

        (b)   All obligations created herein shall survive change or termination
              of any and all business relationships between the parties for a
              period of three years after such termination.


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        (c)   The Company may from time to time request suggestions, feedback or
              other information from the Manager on Confidential Information or
              on released or unreleased software belonging to the Company. Any
              suggestions, feedback or other disclosures made by the Manager are
              and shall be entirely voluntary on the part of the Manager and
              shall not create any obligations on the part of the Company or a
              confidential agreement between the Manager and the Company.
              Instead, the Company shall be free to disclose and use any
              suggestions, feedback or other information from the Manager as the
              Company sees fit, entirely without obligation of any kind
              whatsoever to the Manager.


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