Document:

Exhibit 10.16

 

THIS FLOW-THROUGH SHARE
AGREEMENT entered into this 30th day
of March, 2006.

BETWEEN:

GEOPETRO CANADA LTD., a corporation incorporated pursuant to the laws of the Province of
Alberta (the “Corporation”)

- and -

GEOPETRO RESOURCES COMPANY, a company incorporated pursuant to the laws of California (the “Subscriber”)

WHEREAS the Subscriber has offered to subscribe for shares in the capital stock
of the Corporation issued on a “flow-through” basis under the Tax Act (as
defined below);

AND WHEREAS the Corporation wishes to accept that offer upon the terms and
conditions hereinafter set forth;

NOW THEREFORE the parties hereto agree as follows:

1.                                       The Subscriber hereby irrevocably subscribes for 2,000,075 common shares
of the Corporation issued on a “flow-through basis” (“Flow-Through Shares”) at a price of $1.00
per Flow-Through Share for an aggregate subscription price of $2,000,075 (the “Commitment Amount”) upon the terms and
conditions set forth in this agreement (this “Flow-Through
Share Agreement”) constituted by the acceptance hereof.

2.                                       In this Flow-Through Share Agreement Agreement:

(a)                                  “Canadian Exploration Expense(s)”
or “CEE” means Canadian
exploration expense described in paragraph (a) or (d) of the definition of “Canadian
exploration expense” in subsection 66.1(6) of the Tax Act or that would be
included in paragraph (h) of that definition if the reference therein to “paragraphs
(a) to (d) and (f) to (g.1)” were read as “paragraphs (a) and (d)”, excluding
any amounts which are prescribed to constitute “Canadian exploration and
development overhead expense” under the Tax Act, the amount of any assistance
received by the Corporation described in paragraph 66(12.6)(a) of the Tax Act
and any expense described in paragraph 66(12.6)(b.1) of the Tax Act;

(b)                                 “Expenditure Period” means
the period commencing on the date of acceptance of this Flow-Through Share
Agreement and ending on the earlier of:

(i)                                     the date on which the Commitment Amount has been fully expended in
accordance with the terms hereof; and

(ii)                                  December 31, 2007;

 

 

(c)                                  “Principal Business Corporation”
means a principal-business corporation as defined in subsection 66(15) of the
Tax Act;

(d)                                 “Qualifying Expenditures”
means expenses that are CEE at the date they are incurred; and

(e)                                  “Tax Act” means the Income Tax Act (Canada), together with any
and all regulations promulgated thereunder (the “Regulations”), as amended from time to time.

3.                                       The Subscriber represents, warrants, covenants, certifies, acknowledges
and declares to the Corporation (and acknowledges that the Corporation is
relying thereon) that:

(a)                                  this Flow-Through Share Agreement is subject to acceptance by the
Corporation and is effective only upon such acceptance;

(b)                                 the liability of the Corporation to renounce CEE is limited to the
extent specifically stated in this Flow-Through Share Agreement.

(c)                                  this Flow-Through Share Agreement has been duly and validly authorized,
executed and delivered by and constitutes a legal, valid, binding and
enforceable obligation of the Subscriber;

(d)                                 it has the legal capacity and competence to enter into and be bound by
this Flow-Through Share Agreement and further certifies that all necessary
approvals of directors, shareholders or otherwise have been given and obtained;

(e)                                  the entering into of this Flow-Through Share Agreement and the
transactions contemplated hereby will not result in a violation of any of the
terms and provisions of any law applicable to it, or any of its constating
documents, or of any agreement to which the Subscriber is a party or by which
it is bound;

(f)                                    the Subscriber has not received nor does it expect to receive any
financial assistance from the Corporation directly or indirectly, in respect of
the Subscriber’s purchase of the Flow-Through Shares; and

(g)                                 the Subscriber will not enter into any agreement which will cause the
Flow-Through Shares to become “prescribed shares” within the meaning of
Regulation 6202.1.

4.                                       The Corporation hereby represents and warrants to and for the benefit of
the Subscriber (and acknowledges that the Subscriber is relying thereon) that:

(a)                                  the Corporation has been duly incorporated and organized, and is a valid
and subsisting corporation, under the laws of the Province of Alberta, and is
qualified to carry on business in the Province of Alberta and in each other
jurisdiction, if 

 

2

 

any, wherein the
carrying out of the activities contemplated hereby makes such qualification
necessary;

(b)                                 the Corporation has the full corporate right, power and authority to
execute and deliver this Flow-Through Share Agreement, to issue the
Flow-Through Shares to the Subscriber and to incur and renounce to the
Subscriber, Qualifying Expenditures in an amount equal to the Commitment
Amount;

(c)                                  the Corporation is, and at all material times will be, a Principal
Business Corporation;

(d)                                 the Flow-Through Shares will be “flow-through shares” as defined in
subsection 66(15) of the Tax Act and, except as the result of an agreement or
arrangement to which the Corporation is not a party and of which it is not
aware, will not constitute “prescribed shares” for the purpose of Section
6202.1 of the Regulations;

(e)                                  this Flow-Through Share Agreement constitutes a valid and binding
obligation of the Corporation enforceable against it in accordance with its
terms; and

(f)                                    the execution and delivery of, and the performance of the terms of this
Flow-Through Share Agreement by the Corporation, including the issuance of the
Flow-Through Shares, the incurring of Qualifying Expenditures and the
renunciation of Qualifying Expenditures to the Subscriber pursuant hereto does
not and will not constitute a breach of or constitute a default under the
constating documents of the Corporation or any law, regulation, order or ruling
applicable to the Corporation or any agreement, contract or indenture to which
the Corporation is a party or by which it is bound.

5.                                       The Corporation covenants and agrees with the Subscriber:

(a)                                  to keep proper books, records and accounts of all Qualifying Expenditures
and all transactions affecting the aggregate Commitment Amount and the
Qualifying Expenditures, and upon reasonable notice and on a reasonable basis,
to make such books, records and accounts available to the Subscriber for
inspection;

(b)                                 to file with the appropriate tax authorities, the form prescribed by
subsection 66(12.68) of the Tax Act together with a copy of this Flow-Through
Share Agreement within the time period prescribed by law;

(c)                                  to file with the appropriate tax authorities, the form prescribed by
subsection 66(12.7) of the Tax Act on or before the last day of the first month
following each month in which any renunciation is made pursuant to the terms of
this Flow-Through Share Agreement;

 

3

 

(d)                                 to incur, during the Expenditure Period, Qualifying Expenditures in such
amount as enables the Corporation to renounce to the Subscriber in accordance
with the Tax Act and this Flow-Through Share Agreement, Qualifying Expenditures
in an amount equal to the Commitment Amount;

(e)                                  to renounce to the Subscriber, effective on or before December 31, 2007,
Qualifying Expenditures incurred during the Expenditure Period as required
under the Tax Act in an amount equal to the Commitment Amount;

(f)                                    to deliver to the Subscriber, not later than February 28 next
following the end of a calendar year in which Qualifying Expenses were
renounced to the Subscriber, a statement setting forth the aggregate amounts of
CEE renounced hereunder for such calendar year;

(g)                                 that the Corporation will maintain its status as a Principal Business
Corporation throughout the Expenditure Period;

(h)                                 to file all forms required under the Tax Act to effectively renounce
Qualifying Expenditures in accordance with the provisions of this Flow-Through
Share Agreement and the Prospectus and, if requested, to promptly provide the
Subscriber with a copy of all such forms;

(i)                                     that all Qualifying Expenditures renounced to the Subscriber pursuant to
this Flow-Through Share Agreement will be Qualifying Expenditures incurred by
the Corporation that, but for the renunciation to the Subscriber, the
Corporation would, if it had sufficient income, be entitled to deduct in
computing its income for the purposes of Part I of the Tax Act;

(j)                                     that the Corporation will not be subject to the provisions of subsection
66(12.67) of the Tax Act in a manner which impairs its ability to renounce
Qualifying Expenditures to the Subscriber in an amount equal to the Commitment
Amount; and

(k)                                  that the Corporation will refrain from entering into any agreements or
transactions, or taking deductions which would otherwise reduce its cumulative
CEE to an extent, that would preclude the renunciation of Qualifying
Expenditures hereunder in an amount equal to the Commitment Amount as
contemplated herein.

6.                                       Nothing herein shall constitute or be construed to constitute a
partnership of any kind whatsoever between the Subscriber or any of them and
the Corporation.

7.                                       The contract arising out of this Flow-Through Share Agreement and all
documents relating thereto, which by common accord has been and will be drafted
in English, shall be governed by and construed in accordance with the laws of
the Province of Alberta and the laws of Canada applicable therein.

 

4

 

8.                                       Time shall be of the essence hereof.

9.                                       This Flow-Through Share Agreement shall be binding on and enure to the
benefit of the Subscriber and the Corporation and their respective successors
and assigns.

DATED at
the City of Calgary, in the Province of Alberta, this 30th day of March, 2006.

	
   

  	
   

  	
  GEOPETRO RESOURCES COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  /s/ J. Chris
  Steinhauser

  

 

 

THIS FLOW-THROUGH SHARE AGREEMENT IS
ACCEPTED AND AGREED TO BY THE CORPORATION at
the City of Calgary, in the Province of Alberta, this 30th day of March, 2006.

GEOPETRO CANADA LTD.

 

	
  Per:

  	
  /s/ S. J. Doshi

  	
   

  

 

 

 

5Exhibit 10.17

SUBSCRIPTION
AND RENUNCIATION AGREEMENT

TO:                            GEOPETRO
RESOURCES COMPANY (the “Corporation”)

One Maritime Plaza, Suite 700

San Francisco, California  94111

USA

1.                                       _______________________,
as the duly authorized agent (the “Agent”)
for those persons listed on Schedule “A” attached hereto (the “Subscribers”) and in the respective numbers
set out therein, hereby irrevocably subscribes for 519,500 common shares of the
Corporation issued on a “flow-through basis” (“Flow-Through Common Shares”) at a price of $3.85 per
Flow-Through Common Share for an aggregate subscription price of $2,000,075,
upon the terms and conditions set forth in this agreement (the “Subscription Agreement”) constituted by the
acceptance hereof and as described in the final prospectus (the “Prospectus”) of the Corporation dated March
14, 2006.

The Agent represents and warrants to the Corporation that it has been
authorized to enter into this Subscription Agreement on behalf of the
Subscribers and to make the representations, warranties and statements
contained herein on their behalf.  The
Subscribers have received a copy of the Prospectus and have tendered payment of
their respective subscription price to the Agent in order that it may deliver a
certified cheque or bank draft payable to the Corporation in respect thereof.

2.                                       In
this Subscription Agreement:

(a)                                  “Canadian Exploration Expense(s)” or “CEE” means Canadian exploration expense
described in paragraph (a) or (d) of the definition of “Canadian
exploration expense” in subsection 66.1(6) of the Tax Act or that would be
included in paragraph (h) of that definition if the reference therein to “paragraphs (a)
to (d) and (f) to (g.1)” were read as “paragraphs (a) and (d)”, excluding
any amounts which are prescribed to constitute Canadian exploration and
development overhead expense under the Tax Act, the amount of any assistance
received by the Corporation described in paragraph 66(12.6)(a) of the Tax
Act and any expense described in paragraph 66(12.6)(b.1) of the Tax Act;

(b)                                 “Commitment Amount” means an amount equal to
$3.85 multiplied by the number of Flow-Through Common Shares subscribed for
hereunder;

(c)                                  “Expenditure Period” means the period
commencing on the date of acceptance of this Subscription Agreement and ending
on the earlier of:

(i)                                     the
date on which the Commitment Amount has been fully expended in accordance with
the terms hereof; and

(ii)                                  December 31, 2007;

(d)                                 “Principal Business Corporation” means a
principal-business corporation as defined in subsection 66(15) of the Tax Act;

(e)                                  “Qualifying Expenditures” means expenses
that are CEE at the date they are incurred, or are deemed to be incurred; and

 

(f)                                    “Tax Act” means the Income Tax Act (Canada), together with any
and all regulations promulgated thereunder (the “Regulations”), as amended from time to time.

3.                                       All
capitalized terms used herein and not otherwise defined herein shall have the
same meanings herein as are ascribed thereto in the Prospectus.

4.                                       Each
Subscriber represents, warrants, covenants, certifies, acknowledges and
declares to the Corporation and the Agent (and acknowledges that the
Corporation and the Agent are relying thereon) that:

(a)                                  this
Subscription Agreement is subject to acceptance by the Corporation and is
effective only upon such acceptance;

(b)                                 the
Subscriber has received and reviewed a copy of the Prospectus;

(c)                                  except
as provided herein or as otherwise set out in the Prospectus, the Subscriber
waives any right it may have to any potential incentive grants, credits or
similar or like payments or benefits which accrue as a result of the operations
relating to CEE and acknowledges that all such grants, credits, payments or
benefits accrue to the benefit of the Corporation;

(d)                                 neither
the Subscriber nor any beneficial purchaser for whom it is acting is a non-resident
of Canada for the purposes of the Tax Act;

(e)                                  the
Subscriber, if an individual, is of the full age of majority and is otherwise
legally competent to enter into this Subscription Agreement;

(f)                                    the
Subscriber, and any beneficial purchaser for whom it is acting deals, and until
January 1, 2008 will continue to deal, at arm’s length with the Corporation for
the purposes of the Tax Act;

(g)                                 neither
the Subscriber nor any beneficial purchaser for whom it is acting, has received
or expects to receive any financial assistance from the Corporation directly or
indirectly in respect of the purchase of Flow-Through Common Shares;

(h)                                 neither
the Subscriber nor any beneficial purchaser for whom it is acting will enter
into any arrangement with any person, trust or partnership (other than the
Corporation) which will cause the Flow-Through Common Shares to become “prescribed
shares” within the meaning of Regulation 6202.1; and

(i)                                     the
liability of the Corporation to renounce CEE is limited to the extent
specifically stated in the Prospectus and in this Subscription Agreement.

5.                                       The
Corporation hereby represents and warrants to and for the benefit of the
Subscribers and the Agent (and acknowledges that the Subscribers and the Agent
are relying thereon) that:

(a)                                  the
Corporation has been duly amalgamated and organized, and is a valid and
subsisting corporation, under the laws of the state of California, and is
qualified to carry on business in the state of California and in each other
jurisdiction, if any, wherein the carrying out of the activities contemplated
hereby makes such qualification necessary;

 

2

 

(b)                                 the
Corporation has the full corporate right, power and authority to execute and
deliver this Subscription Agreement, to issue the Flow-Through Common Shares to
the Subscribers and to incur, or be deemed to incur, and renounce to the
Subscribers, Qualifying Expenditures in an amount equal to the Commitment
Amount;

(c)                                  the
Corporation is, and at all material times will be, a Principal Business
Corporation;

(d)                                 except
as the result of an agreement or arrangement to which the Corporation is not a
party and of which it is not aware, the Flow-Through Common Shares will be “flow-through
shares” as defined in subsection 66(15) of the Tax Act and will not constitute “prescribed
shares” for the purpose of Section 6202.1 of the Regulations;

(e)                                  this
Subscription Agreement constitutes a valid and binding obligation of the
Corporation enforceable against it in accordance with its terms; and

(f)                                    the
execution and delivery of, and the performance of the terms of this
Subscription Agreement by the Corporation, including the issuance of the
Flow-Through Common Shares, the incurring (or the deemed incurrence) of Qualifying
Expenditures and the renunciation of Qualifying Expenditures to the Subscribers
pursuant hereto does not and will not constitute a breach of or constitute a
default under the constating documents of the Corporation or any law,
regulation, order or ruling applicable to the Corporation or any agreement,
contract or indenture to which the Corporation is a party or by which it is
bound.

6.                                       The
Corporation covenants and agrees with each of the Subscribers:

(a)                                  to
keep proper books, records and accounts of all Qualifying Expenditures and all
transactions affecting the aggregate Commitment Amount and the Qualifying
Expenditures, and upon reasonable notice and on a reasonable basis, to make
such books, records and accounts available to an authorized representative of
the Subscribers for inspection by such representative on behalf of the
Subscribers;

(b)                                 to
file with the appropriate tax authorities, the form prescribed by subsection 66(12.68) of the Tax Act (and, if
applicable, the corresponding form prescribed by provincial tax legislation)
together with a copy of this Subscription Agreement and the Prospectus within
the time period prescribed by law;

(c)                                  to
file with the appropriate tax authorities, the form prescribed by subsection 66(12.7) of the Tax Act (and, if
applicable, the corresponding form prescribed by provincial tax legislation) on
or before the last day of the first month following each month in which any
renunciation is made pursuant to the terms of this Subscription Agreement;

(d)                                 to
incur (or be deemed to incur pursuant to subsection 66(12.61) of the Tax
Act), during the Expenditure Period, Qualifying Expenditures in an amount not
less than the Commitment Amount so as to enable the Corporation to renounce to
each of the Subscribers in accordance with the Tax Act and this Subscription
Agreement, Qualifying Expenditures in an amount equal to the Commitment Amount
of each such Subscriber;

(e)                                  to
renounce on or before March 31, 2007 in the prescribed form, to each of the
Subscribers, effective on or before December 31,
2006, Qualifying Expenditures incurred 

 

3

 

during the Expenditure
Period as required under the Tax Act in an amount equal to the Commitment
Amount of each such Subscriber;

(f)                                    to
deliver to each Subscriber at the Subscriber’s address set forth in Schedule “A”
attached hereto, not later than March 31,
2007, a statement setting forth the aggregate amounts of CEE renounced to such
Subscriber pursuant hereto;

(g)                                 that
the Corporation will not reduce the amount renounced to each Subscriber
pursuant to this Subscription Agreement and, in the event that an appropriate
tax authority reduces the amount renounced to a Subscriber under this
Subscription Agreement pursuant to subsection 66(12.73)
of the Tax Act, as the sole recourse by such Subscriber for such reduction, the
Corporation shall indemnify such Subscriber as to, and pay to such Subscriber
an amount equal to, the amount of any tax payable or that may become payable
under the Tax Act (and any other corresponding provincial legislation) by such
Subscriber as a consequence of such reduction;

(h)                                 that
if the Corporation does not renounce, effective on or before December 31, 2006, to a Subscriber Qualifying
Expenditures incurred during the Expenditure Period equal to the Commitment
Amount of such Subscriber, as the sole recourse by such Subscriber for such
failure to renounce, the Corporation shall indemnify such Subscriber as to, and
pay to such Subscriber, an amount equal to the amount of any tax payable or
that may become payable under the Tax Act (and under any corresponding
provincial legislation) by such Subscriber as a result of such failure;

(i)                                     that
the Corporation will maintain its status as a Principal Business Corporation
throughout the Expenditure Period;

(j)                                     to
file all forms required under the Tax Act (and any applicable provincial tax
laws) to effectively renounce Qualifying Expenditures in accordance with the
provisions of this Subscription Agreement and the Prospectus and, if requested,
to promptly provide the Subscribers with a copy of all such forms;

(k)                                  that
all Qualifying Expenditures renounced to the Subscribers pursuant to this
Subscription Agreement will be Qualifying Expenditures incurred (or deemed by
subsection 66(12.61) of the Tax Act to have been incurred) by the
Corporation that, but for the renunciation to the Subscribers, the Corporation
would, if it had sufficient income, be entitled to deduct in computing its
income for the purposes of Part I of the Tax Act;

(l)                                     that
the Corporation will not be subject to the provisions of subsection 66(12.67) of the Tax Act in a manner
which impairs its ability to renounce Qualifying Expenditures to the
Subscribers in an amount equal to the Commitment Amount; and

(m)                               that
the Corporation will refrain from entering into transactions or taking
deductions which would otherwise reduce its cumulative CEE to an extent that
would preclude the renunciation of Qualifying Expenditures hereunder in an
amount equal to the Commitment Amount as contemplated herein.

7.                                       Nothing
herein shall constitute or be construed to constitute a partnership of any kind
whatsoever between the Subscribers or any of them and the Corporation.

 

4

8.                                       The
contract arising out of this Subscription Agreement and all documents relating
thereto, which by common accord has been and will be drafted in English, shall
be governed by and construed in accordance with the laws of the Province of
Alberta and the laws of Canada applicable therein.

9.                                       Time
shall be of the essence hereof.

10.                                 The
covenants, representations and warranties contained in this Subscription
Agreement shall be true and correct as of closing and shall survive the closing
of the offering of securities under the Prospectus.

11.                                 The
subscriptions of the Subscribers are further subject to any rights available to
the Subscribers under applicable laws.

12.                                 This
Subscription Agreement shall be binding on and enure to the benefit of the
Subscribers and the Corporation and their respective heirs, executors,
administrators, successors and assigns.

DATED at the City of Calgary, in the Province of
Alberta, this 30th day of March, 2006.

	
   

  	
   

  	
  DUNDEE SECURITIES CORPORATION, as duly authorized agent for
  those Subscribers whose names are set out on Schedule “A” attached hereto.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  /s/ Vilma Jones

  
	
   

  	
   

  	
   

  

 

THIS SUBSCRIPTION AND RENUNCIATION AGREEMENT IS ACCEPTED AND AGREED TO
BY THE CORPORATION at the City of Calgary, in the Province of Alberta, this
30th day of March, 2006.

GEOPETRO RESOURCES COMPANY

 

	
  Per:

  	
  /s/ J. Chris
  Steinhauser

  	
   

  

 

 

5

SCHEDULE “A”

GEOPETRO RESOURCES COMPANY

 

	
  Name of 

  Subscriber

  	
   

  	
  Address of 

  Subscriber

  	
   

  	
  Social Insurance No. or Corporate Tax
  Account No.

  	
   

  	
  Number of Flow-Through Common Shares

  Subscribed for

  	
   

  	
  Total Subscription Amount @ $3.85 per Share

  (Commitment Amount)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]