Note 14 - Commitments and Contingencies

We have entered into employment agreements with certain of our executives and officers. The term of the agreements generally ranges from one to two years and provides for renewal provisions in one-year increments thereafter. The agreements provide for, among other items, severance and continuation of benefit payments upon termination of employment or certain change of control events.

We have entered into non-current firm transportation contracts to ensure the transport for certain of our gas production to purchasers. Firm transportation volumes and the related demand charges for the remaining term of these contracts at December 31, 2018 are summarized in the table below.

Period	Dekatherms per day		Demand Charges
January 2019 – March 2020		3,230	$	0.20 – 0.62
April 2020 – May 2020		2,150	$	0.20
June 2020 – May 2036		1,000	$	0.20
Jan 2019 – Oct 2020		6,300	$	0.21
Jan 2019 – Aug 2022		49,341	$	0.21 – 0.56
Sep 2022 – May 2027		29,990	$	0.21

F-36

As of December 31, 2018, the remaining commitment related to the firm transportation contracts assumed in the EXCO Acquisition in 2016 and OIE Membership Acquisition is $18.9 million and reflected in the Company’s consolidated balance sheet. The fair values of these firm transportation obligations were determined based upon the contractual obligations assumed by the Company and discounted based upon the Company’s effective borrowing rate. These contractual obligations are being reduced monthly as the Company pays these firm transportation obligations in the future.

Natural gas processing agreement

We have entered into an initial five-year gas processing agreement. We have an option to extend the term of the agreement by another five years. The related demand charges for volume commitments over the remaining term of the agreement at December 31, 2018 are approximately $1.8 million per year. We will pay a processing fee of $2.50 per MCF for the term of the agreement, with a minimum annual volume commitment of 720,000 MCF.

Capital Commitment

As of December 31, 2018, we had no capital commitments associated with Carbon California.