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COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Dec. 31, 2018
COMMITMENTS AND CONTINGENCIES |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES The Company is obligated under various non-cancellable lease agreements providing for office space, warehouse space, and automobiles that expire at various dates through the year 2033. Rent expense under operating leases was $6.1 million, $10.7 million and $9.9 million for the years ended December 31, 2018, 2017 and 2016, respectively. Future minimum rental payments at December 31, 2018 under the operating leases referred to above are as follows:
Year Ending December 31: |  |  |
2019 |  | $ | 3,954
2020 |  |  | 2,949
2021 |  |  | 2,410
2022 |  |  | 2,114
2023 |  |  | 1,681
2024 and thereafter |  |  | 14,860
|  | $ | 27,968
Contractual obligations – The Company has the following contractual obligations related primarily to sponsorships and other commitments as of December 31, 2018:
Year Ending December 31: |  |  |
2019 |  | $ | 99,004
2020 |  |  | 51,572
2021 |  |  | 23,577
2022 |  |  | 12,628
2023 |  |  | 3,405
2024 and thereafter |  |  | —
|  | $ | 190,186
Purchase Commitments – The Company has purchase commitments aggregating approximately $49.8 million at December 31, 2018, which represent commitments made by the Company and its subsidiaries to various suppliers of raw materials for the production of its products. These obligations vary in terms, but are generally satisfied within one year. The Company purchases various raw material items, including, but not limited to, flavors, ingredients, dietary ingredients, containers, milk, glucose, sucralose, cream and protein, from a limited number of suppliers. An interruption in supply from any of such resources could result in the Company’s inability to produce certain products for limited or possibly extended periods of time. The aggregate value of purchases from suppliers of such limited resources described above for the years ended December 31, 2018, 2017 and 2016 was $289.6 million, $273.6 million and $205.9 million, respectively. Guarantees – The Company from time to time enters into certain types of contracts that contingently require the Company to indemnify parties against third-party claims. These contracts primarily relate to: (i) certain agreements with the Company’s officers, directors and employees under which the Company may be required to indemnify such persons for liabilities arising out of their employment relationship, (ii) certain distribution or purchase agreements under which the Company may have to indemnify the Company’s customers from any claim, liability or loss arising out of any actual or alleged injury or damages suffered in connection with the consumption or purchase of the Company’s products or the use of Company trademarks, and (iii) certain real estate leases, under which the Company may be required to indemnify property owners for liabilities and other claims arising from the Company’s use of the applicable premises. The terms of such obligations vary and typically, a maximum obligation is not explicitly stated. Generally, the Company believes that its insurance coverage is adequate to cover any resulting liabilities or claims. Litigation – The Company, TCCC and certain affiliates are parties to various agreements setting forth, among other things, provisions relating to TCCC’s equity holding in the Company and the terms on which the Company’s energy products are distributed globally by members of TCCC’s distribution network. Among other provisions, the agreements restrict TCCC from competing in the energy drink category in certain territories prior to the termination of the applicable distribution coordination agreement with TCCC, with certain exceptions. TCCC has developed three energy products that it believes it may market under the exception relating to the Coca-Cola brand. The Company believes that the exception does not apply to this situation. By mutual agreement to obtain clarification, the issue was submitted to the American Arbitration Association on October 31, 2018. We expect a decision will be reached during the second quarter of 2019. TCCC has indicated that it has suspended the proposed launch of such products until April 2019. As the relief sought is limited, no reasonable possible range of losses, if any, can be estimated. The Company is currently a defendant in a number of personal injury lawsuits, claiming that the death or other serious injury of the plaintiffs was caused by consumption of Monster Energy® brand energy drinks. The plaintiffs in these lawsuits allege strict product liability, negligence, fraudulent concealment, breach of implied warranties and wrongful death. The Company believes that each complaint is without merit and plans a vigorous defense. The Company also believes that any damages, if awarded, would not have a material adverse effect on the Company’s financial position or results of operations. Furthermore, from time to time in the normal course of business, the Company is named in other litigation, including consumer class actions, intellectual property litigation and claims from prior distributors. Although it is not possible to predict the ultimate outcome of such litigation, based on the facts known to the Company, management believes that such litigation in the aggregate will likely not have a material adverse effect on the Company’s financial position or results of operations. The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that is accrued, if any, or in the amount of any related insurance reimbursements recorded. As of December 31, 2018, the Company’s consolidated balance sheet includes accrued loss contingencies of approximately $0.06 million.

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