Commitments and Contingencies As of December 31, 2018 and 2017 , the Company had $4.2 million and $19.8 million of deposits on equipment, respectively. Outstanding purchase commitments on equipment were $43.6 million and $82.5 million , as of December 31, 2018 and 2017 , respectively. As of December 31, 2018 , the Company has committed $2.4 million and anticipates committing a further $3.3 million to research and development with its equity-method investee, which is expected to generate economic benefits in 2019. As of December 31, 2018 , the Company has a letter of credit of $2.5 million under the 2017 ABL Facility, which secures its performance obligations related to the Companys CIT capital lease. In the normal course of operations, the Company enters into certain long-term raw material supply agreements for the supply of proppant to be used in hydraulic fracturing. As part of these agreements, the Company is subject to minimum tonnage purchase requirements and may pay penalties in the event of any shortfall. The Company purchased $107.4 million , $150.0 million and $24.6 million amounts of proppant under its take-or-pay agreements during the years ended December 31, 2018 , 2017 and 2016 . Aggregate minimum commitments under long-term raw material supply agreements for the next five years as of December 31, 2018 are listed below: (Thousands of Dollars) Year-end December 31, 2019 $ 34,495 2020 32,803 2021 15,863 2022 9,300 2023 1,600 $ 94,061 Litigation From time to time, the Company is subject to legal and administrative proceedings, settlements, investigations, claims and actions, as is typical of the industry. These claims include, but are not limited to, contract claims, environmental claims, employment related claims, claims alleging injury or claims related to operational issues. The Companys assessment of the likely outcome of litigation matters is based on its judgment of a number of factors, including experience with similar matters, past history, precedents, relevant financial information and other evidence and facts specific to the matter. In accordance with GAAP, the Company accrues for contingencies where the occurrence of a material loss is probable and can be reasonably estimated, based on the Companys best estimate of the expected liability. The Company may increase or decrease its legal accruals in the future, on a matter-by-matter basis, to account for developments in such matters. Notwithstanding the uncertainty as to the final outcome and based upon the information currently available to it, the Company does not currently believe these matters in aggregate will have a material adverse effect on its financial position or results of operations. The Company was served with class and collective action claims alleging that the Company failed to pay a nationwide class of workers overtime in compliance with the Fair Labor Standards Act (FLSA) and state laws. On December 27, 2016, two former employees filed a complaint for a proposed collective action in United States District Court for the Southern District of Texas entitled Hickson and Villa v. Keane Group Holdings, LLC, et al., alleging certain field professionals were not properly classified under the FLSA and Pennsylvania law. In the first quarter of 2018, the parties agreed to settle the claims for $4.2 million , which was funded in the fourth quarter of 2018. The Company was involved in a commercial dispute whereby a former customer commenced an arbitration proceeding, captioned Halcon Operating Co., Inc. and Halcon Energy Properties, Inc. v. Keane Frac LP and Keane Frac GP, LLC. The Company settled this claim for $1.6 million and wrote-off the associated $0.6 million of bad debt on its consolidated and combined balance sheet as of December 31, 2018 . Additionally, in November 2017, the Company was served with two class or collective claims, captioned Omar Castro v. Keane and Vu Tran v. Keane, both alleging that the Company failed to pay a Texas class of workers an appropriate overtime rate in compliance with the FLSA and state laws. These two claims were consolidated on January 30, 2018 and captioned Vu Tran, et al. v. Keane. After the Company substantially completed its discovery, the Company recognized an estimated liability in the third quarter of 2018, as the occurrence of a loss was probable and reasonably estimable. In the first quarter of 2019, the parties agreed to settle this consolidated claim for $1.0 million . Environmental The Company is subject to various federal, state and local environmental laws and regulations that establish standards and requirements for protection of the environment. The Company cannot predict the future impact of such standards and requirements, which are subject to change and can have retroactive effectiveness. The Company continues to monitor the status of these laws and regulations. Currently, the Company has not been fined, cited or notified of any environmental violations that would have a material adverse effect upon its financial position, liquidity or capital resources. However, management does recognize that by the very nature of the Companys business, material costs could be incurred in the near term to maintain compliance. The amount of such future expenditures is not determinable due to several factors, including the unknown magnitude of possible regulation or liabilities, the unknown timing and extent of the corrective actions which may be required, the determination of the Companys liability in proportion to other responsible parties and the extent to which such expenditures are recoverable from insurance or indemnification. Regulatory Audits In 2017, the Company was notified by the Texas Comptroller of Public Accounts that it will conduct a routine audit of Keane Frac TX, LLCs direct payment sales tax for the periods of January 2014 through May 2017. As of December 31, 2018, the audit is ongoing; however, the Company currently anticipates that the audit could result in an assessment of $0.8 million , which has been recorded in selling, general and administrative expenses in the Companys consolidated and combined statements of operations and comprehensive income (loss).