Business Context and Reporting Period
This Form 8-K reports on events occurring on December 31, 2020, for Liberty Oilfield Services Inc. (the "Company"). The filing documents the completion of a previously announced transaction to acquire Schlumberger's onshore hydraulic fracturing business in the United States and Canada. The acquired assets include pressure pumping, pumpdown perforating, and Permian frac sand businesses.
Key Financial Metrics and Transaction Consideration
The filing does not provide specific revenue, profit, cash flow, margin, debt, or liquidity figures for the Company or the acquired business. The transaction was structured as an equity sale with the following consideration:
- US Acquisition: 57,377,232 shares of Company Class A common stock issued to Schlumberger US.
- Canadian Acquisition: 8,948,902 shares of Company Class A common stock issued to satisfy a non-interest-bearing demand promissory note to Schlumberger Canada.
- Total Equity Issued: 66,326,134 shares of Class A common stock.
Historical financial statements and pro forma financial information for the acquired business are not included in this filing and are scheduled to be filed by amendment within 71 days.
Material Changes and Corporate Actions
The following material changes were effected on the Closing Date:
- Asset Acquisition: The Company acquired 100% of the membership interests in subsidiaries holding Schlumberger's US and Canadian onshore hydraulic fracturing assets.
- Stockholder Agreements: An Amended and Restated Stockholders Agreement (A&R SHA) was entered into with Riverstone and the Schlumberger Parties. This agreement outlines director nomination rights based on ownership thresholds and imposes lock-up and standstill restrictions on the Schlumberger Parties.
- Registration Rights: An Amended and Restated Registration Rights Agreement (A&R RRA) was executed, granting demand and piggyback registration rights to certain holders, including the Schlumberger Parties and Riverstone.
- Termination of Prior Agreement: The original IPO Stockholders Agreement dated January 17, 2018, was terminated.
- Board Composition: Directors N. John Lancaster, Jr. and Jesal Shah resigned. Simon Ayat and James McDonald were appointed to the Board, resulting in a nine-member Board.
Guidance, Outlook, and Risks
The filing does not contain specific financial guidance or management commentary regarding future earnings or operational outlook. Key contractual restrictions and contingencies include:
- Lock-Up and Transfer Restrictions: Schlumberger Parties are restricted from transferring shares for nine months post-closing and are prohibited from transferring shares to direct competitors or Schedule 13D filers for four years.
- Standstill Provisions: Schlumberger Parties are subject to a four-year standstill preventing them from acquiring additional equity or seeking merger proposals.
- Registration Thresholds: The Company is not obligated to effect an underwritten offering for Sponsoring Holders unless the gross sale proceeds are reasonably likely to be at least $25 million.
Investor Verification Checklist
- Verify the total number of outstanding shares post-transaction to assess dilution impact.
- Review the upcoming amendment to this 8-K (due within 71 days) for historical financial statements and pro forma data of the acquired Schlumberger assets.
- Confirm the specific ownership percentages of Riverstone and the Schlumberger Parties to understand current board nomination rights.
- Monitor the press release (Exhibit 99.1) for any additional operational details not contained in the legal text of the 8-K.