Commitments and Contingencies

On December 13, 2013, Evolution Petroleum Corporation and its wholly-owned subsidiaries, Tertiaire Resources Company and NGS Sub. Corp. (collectively, “Evolution”) filed a lawsuit in the 133^rd Judicial District Court of Harris County, Texas, against Denbury Onshore, LLC (“Denbury”) alleging breaches of certain 2006 agreements between the parties regarding the Delhi field in northeast Louisiana. On June 24, 2016, Evolution entered into a settlement agreement with Denbury to resolve all outstanding disputes and claims between the parties, including claims related to the pending litigation between Evolution and Denbury with respect to the Delhi field. Pursuant to the settlement, the parties dismissed with prejudice all such claims between them with respect to such litigation. In addition to clarifying certain aspects of the parties' ongoing relationship, the settlement resolves (a) claims by Evolution in connection with the June 2013 incident at the Delhi field involving a release of well fluids (the “June 2013 Incident”); (b) disputes regarding the occurrence, determination, timing, nature and terms of “payout” and Evolution's related reversionary interest in the Delhi Field; and (c) any claims by Denbury related to the purchase by Denbury of its original Delhi field interest from the Company. Under the terms of the settlement, Evolution retains any and all rights under its existing agreements with Denbury regarding indemnification for any costs which are asserted or arise subsequent to the effective date of the settlement and which relate to periods prior to reversion of its working interest, including any such costs related to the June 2013 Incident. See Note 3 — Delhi Field Litigation Settlement.

On December 3, 2013, our wholly owned subsidiary, NGS Sub Corp., was served with a lawsuit filed in the 8th Judicial District Court of Winn Parish, Louisiana by Cecil M. Brooks and Brandon Hawkins, residents of Louisiana, alleging that in 2006 a former subsidiary of NGS Sub Corp. improperly disposed of water from an off-lease well into a well located on the plaintiffs’ lands in Winn Parish. The plaintiffs requested monetary damages and other relief. NGS Sub Corp. divested its ownership of the property in question along with its ownership of the subsidiary in 2008 to a third party. The district court granted our exception of no right of action and dismissed certain claims against NGS Sub Corp. The plaintiffs subsequently filed an amended petition naming NGS Sub Corp. and the Company as defendants. NGS Sub Corp. and the Company have denied the plaintiffs’ claims. Various pretrial motions filed on behalf of multiple parties were recently decided by the court and discovery is in process. We will continue to vigorously defend all claims by plaintiffs and consider the likelihood of a material loss to the Company in this matter to be remote.

Lease Commitments. We had a non-cancelable lease for office space that expired on July 31, 2016. Late in fiscal 2016, the Company entered into a new non-cancelable office space with a three year term ending on May 31, 2019. Future minimum lease commitments as of June 30, 2016 under these operating leases are as follows:



For the fiscal year ended June 30,
2017	$	80,235
2018	73,073
2019	66,984
Total	$	220,292

Rent expense for the years ended June 30, 2016, 2015, and 2014 was $182,626, $175,103, and $174,229, respectively.

Capital Expenditures. See Note 6 for discussion of capital projects in progress and expected remaining capital commitments.