**Exhibit 10.32**

 

**PROMISSORY NOTE**

 
| **$** | **December         ,  2008** |
|-------|---------------------------------------------------------------------------|

 

1.             FORVALUE RECEIVED, the undersigned, GeoPetro Resources Company, a Californiacorporation (“Maker”), promises to pay to                 ,(“Payee”), the principal sum of               ($          )(the “Principal Amount”) together with interest accruing on the unpaid portionof the Principal Amount from the date hereof until maturity at the annual rateof         percent (    %),with such interest payable quarterly in arrears.  This promissory note shall be referred toherein as the “Note.” The Principal Amount and all accrued and unpaid interestthereon shall be due and payable on             ,         (the “Maturity Date”).  The Principal Amount and any accrued andunpaid interest thereon may be prepaid at any time prior to the Maturity Datewithout penalty.

 

2.             Inconjunction herewith, Payee or Payee’s designee, shall receive warrants in theform attached as an exhibit hereto (the “Warrant Certificate”), to purchase           shares of no par voting common stock of Maker (“Shares”) at a price of $      per Share (the “Exercise Price”), with such Exercise Price being subject toequitable adjustment in the event of a split or reverse split of the Sharesprior to expiration of the warrants.  Thewarrants shall be exercisable during the period commencing upon the date hereofand ending on         ,       as specifically set forth in the Warrant Certificate.

 

3.             Payeeagrees that all amounts due hereunder, including Principal Amount and any accruedand unpaid interest thereon, shall be subordinated to any existing orhereinafter created loan obligations payable by Maker to the Bank of Oklahoma,National Association.

 

4.             Payeeshall have the right to accelerate this Note and to declare the entire unpaidPrincipal Amount and the obligations evidenced hereby immediately due andpayable and to seek and obtain payment of this Note upon the occurrence of anyof the following events of default (the “Events of Default”):  (a) Maker breaches its obligations underthe Warrant Certificate; or (b) Maker fails to fulfill its obligationsunder Section 2 of this Note.

 

5.             Allpayments hereunder shall be made in lawful currency of the United States ofAmerica at such place as Payee shall designate in writing and shall be payableby Maker by check or wire transfer.

 

6.             The validity, construction and performance of this Note,and any action or claim arising out of or relating to this Note, shall begoverned by the laws, without regard to the laws as to choice or conflict oflaws, of the State of California.  Theforum for disputes is San Francisco, California.  Any controversy or claim arising out of orrelating to this Note, or breach thereof, including without limitation claimsagainst either party, its affiliates, employees, professionals, officers ordirectors shall be settled by binding arbitration in San Francisco, California,in accordance with the rules of, and as determined by an arbitratoraffiliated with, JAMS/Endispute.  Thearbitrator(s) shall be an active member of the California Bar.  In the proceeding, the arbitrator(s) shallapply California substantive law and the California Evidence Code.  Payee agrees that the arbitrator(s) shallhave no authority to award punitive damages, and Payee has been advised to seekcounsel concerning the possible waiver by Payee of certain rights otherwiseavailable to the undersigned as a consequence of such agreement.  The arbitrator(s) shall prepare an awardin writing, which shall include factual findings and any legal conclusions onwhich the decision is based.  Judgmentupon any award rendered by the arbitrator(s) may be entered in any courthaving jurisdiction thereof.  In any suchproceeding, the prevailing party shall be entitled, in addition to any otherrelief awarded or adjudged, such sum as the arbitrator(s) may fix as andfor reasonable attorneys’ fees and costs, and the same shall be included in theaward and any judgment.

 

----

 

7.             Eachof the terms, provisions and obligations of this Note shall be binding upon, shallinure to the benefit of, and shall be enforceable by the parties and theirrespective legal representatives, successors and permitted assigns.

 

8.             Payee hereby agrees to execute such other documents asmay be reasonably necessary to consummate the transaction proposed herein,including, but not limited to, regulatory filings which may be required to befiled in Payee’s state of residence.

 

9.             Anynotice herein required or permitted to be given shall be in writing and may bepersonally served or delivered by nationally-recognizable overnight courier orby facsimile machine confirmed telecopy, and shall be deemed delivered at thetime and date of receipt (which shall include telephone line facsimiletransmission).  The addresses for suchcommunications shall be:

 

If to Maker:

 

GeoPetro Resources CompanyOne Maritime PlazaSuite 700San Francisco, CA  94111Attention: Stuart J. Doshi, President and CEO

 

Phone: (415) 398-8186 Facsimile: (415) 398-9227

 

Ifto Payee:

 

Attn:

 

 

 

IN WITNESS WHEREOF, Maker has executed thisNote in favor of Payee is of the date first set forth above.

 

 

MAKER:

 

GeoPetro Resources Company

a California corporation

 
| By:               | /s/ Stuart J. Doshi |   |
|-------------------|---------------------|--------|
| Stuart J. Doshi   |                |
| President and CEO |                |

 

2

----