TERMINATION AGREEMENT

                                                                     Exhibit 4.3
                              TERMINATION AGREEMENT

      THIS TERMINATION AGREEMENT (the "Agreement") is made and entered into
effective as of March 22, 2005, by and among SMARTIRE SYSTEMS, INC., a
corporation organized and existing under the laws of the Yukon Territory (the
"Company"), and CORNELL CAPITAL PARTNERS, LP., a Delaware limited partnership
(the "Buyer").

                                    Recitals:

      WHEREAS, the Company and Buyer entered into a Securities Purchase
Agreement (the "Securities Purchase Agreement"); a Convertible Debenture in the
amount of Two Million Five Hundred Thousand Dollars ($2,500,000) (the
"Convertible Debenture"); a Security Agreement (the "Security Agreement"); an
Investor Registration Rights Agreement (the "Investor Registration Rights
Agreement"); an Escrow Agreement (the "Escrow Agreement"); and an Irrevocable
Transfer Agent Instructions (the "Irrevocable Transfer Agent Instructions"), all
of which are dated December 15, 2004 as well as a Promissory Note in the amount
of Three Hundre