Annual Report of Employee Stock Plans (11-k)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 11-K

(Mark One)


☒			ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2020


☐			TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-38081

___________________________________________________________________________________________________


A. Full title of the plan and the address of the plan, if different from that of the issuer named below:

Liberty Oilfield Services 401(k) Savings Plan


B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

Liberty Oilfield Services Inc.

950 17th Street, Suite 2400

Denver, Colorado 80202

___________________________________________________________________________________________________

TABLE OF CONTENTS


			Page No.
Report of Independent Registered Public Accounting Firm			1
Financial Statements
Statements of Net Assets Available for Benefits			2
Statement of Changes in Net Assets Available for Benefits			3
Notes to Financial Statements			4
Supplemental Schedules			9

Schedule H, Line 4a - Schedule of Delinquent Participant Contributions			9
Schedule H, Part IV, Line 4i ‑ Schedule of Assets (Held at End of Year)			10
Index to Exhibits			12
Signatures			13

Report of Independent Registered Public Accounting Firm

To the Plan Administrator and Plan Participants

Liberty Oilfield Services 401(k) Savings Plan

Opinion on the Financial Statements

We have audited the accompanying statements of net assets available for benefits of the Liberty Oilfield Services 401(k) Savings Plan (the “Plan”) as of December 31, 2020 and 2019, and the related statement of changes in net assets available for benefits for the year ended December 31, 2020, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the net assets of the Plan as of December 31, 2020 and 2019, and the changes in its net assets for the year ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

Basis of Opinion

The Plan’s management is responsible for these financial statements. Our responsibility is to express an opinion on the Plan’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Plan in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Supplemental Information

The supplemental information in the accompanying schedules of assets held at end of year as of December 31, 2020 and delinquent participant contributions for the year ended December 31, 2020 have been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The supplemental information is the responsibility of the Plan’s management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with Department of Labor’s Rules and Regulations for Reporting under the Employee Retirement Income Security Act of 1974. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole.

/s/ Plante & Moran, PLLC

We have served as the Plan’s auditor since 2014.

Denver, Colorado

June 21, 2021

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Statements of Net Assets Available for Benefits


	December 31,
Assets	2020		2019
Investments, at fair value
Liberty Oilfield Services common stock fund	$	523,171	$	387,016
Common/collective trusts	50,806,301		70,527,523
Mutual funds	20,790,673		18,723,709
Pooled separate account	576,655		744,482
Total investments, at fair value	72,696,800		90,382,730
Receivables
Participant notes receivable	4,341,305		5,605,864
Employer contribution	2,338,995		281,643
Employee contribution	398		2,585
Total receivables	6,680,698		5,890,092
Net assets available for benefits	$	79,377,498	$	96,272,822

See Notes to Financial Statements

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Statement of Changes in Net Assets Available for Benefits


	Year Ended December 31,
Additions to net assets	2020
Investment income
Net appreciation in fair value of investments	$	7,155,269
Interest and dividend income	271,294
Total investment income	7,426,563
Interest on participant notes receivable	265,894
Contributions
Employer	6,614,562
Employee	10,174,264
Rollover	897,444
Total contributions	17,686,270
Total additions to net assets	25,378,727
Deductions from net assets
Benefits paid to participants	42,049,789
Administrative fees	224,262
Total deductions from net assets	42,274,051
Net decrease	$	(16,895,324)
Net assets available for benefits
Beginning of year	$	96,272,822
End of year	$	79,377,498

See Notes to Financial Statements

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Notes to Financial Statements

December 31, 2020

Note 1—Description of the Plan and Significant Accounting Policies

The following description of Liberty Oilfield Services 401(k) Savings Plan (the “Plan”) provides only general information. Participants and all others should refer to the Plan document for a more complete description of the Plan’s provisions.

General

The Plan is a defined contribution plan established January 15, 2013, last amended January 1, 2020. The Plan is available to all employees age 18 years or older upon hire. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”).

An Investment Committee comprised of officers and employees of Liberty Oilfield Services LLC (the “Company”) administers the Plan. Principal Trust Company (“Principal”) serves as the third-party administrator, recordkeeper, custodian, and trustee; manages Plan assets; and maintains the Plan’s records. Principal offers Plan participants a variety of investment options through various funds in accordance with provisions of the service and trust agreements with the Company. Individual accounts are invested in the various investment options at the direction of the participants.

Basis of Presentation

The accompanying financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Contributions

Participants may make before-tax or Roth contributions up to 100% of their annual eligible compensation, as limited by the Internal Revenue Service (“IRS”), which is adjusted annually by the Secretary of the Treasury for inflation. This maximum percentage may be reduced by the Plan administrator in certain circumstances. Eligible employees who have reached age 50 during the Plan year may elect to make catch-up contributions, as limited by the IRS. The Plan also permits rollover contributions from other qualified retirement plans. Employee contributions to the Plan are made through regular payroll deductions. Certain employee contributions in 2019 were paid after the time frame required by the Department of Labor. The Company remitted these contributions and related lost earnings to the Plan in 2020.

The Company makes discretionary matching contributions of 100% of elective deferrals up to 6% of annual eligible compensation. Matching contributions are funded each pay period. On April 15, 2020, in connection with other cost savings measures undertaken in response to declining demand for frac services as a result of the impacts of the COVID-19 pandemic, the Company suspended its 6% matching contribution. Effective January 1, 2021, the Company reinstated the 6% matching contribution. The Company has the right to designate all or a portion of the matching contributions as qualified. To the extent matching contributions are so designated, they are non-forfeitable and may not be withdrawn from the Plan prior to separation from service or attainment of age 59½. Discretionary matching contributions made by the Company totaled $4,275,567 for the year ended December 31, 2020.

Once eligibility requirements are met, employees are automatically enrolled in the Plan, and 6% of each employee’s annual eligible compensation is automatically withheld and contributed to the Plan unless the employee makes another election.

The Company may make discretionary or profit-sharing contributions. There were no profit-sharing contributions made for the year ended December 31, 2020.

Participants’ Accounts

Each participant’s account is credited or debited with the participant’s contributions and withdrawals, as applicable, and an allocation of the Company’s contributions, Plan earnings or losses and Plan expenses. Allocations are based upon Plan earnings or losses and account balances, as defined by the Plan. The benefit to which a participant is entitled is the vested portion of the participant’s account.

Vesting

Participants are vested immediately in their contributions, qualified employer contributions, employer discretionary matching contributions, and employer profit-sharing contributions plus actual earnings, less losses thereon.

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Notes to Financial Statements

December 31, 2020

Participant Notes Receivable

Participants may borrow from their accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balances. Participants may have a maximum of one loan outstanding at any given time. The notes receivable are secured by the balances in the participants’ accounts and bear interest at The Wall Street Journal prime rate plus 1.00% (4.25% as of December 31, 2020), which is commensurate with local prevailing rates as determined quarterly by the Plan administrator at loan origination. Notes receivable have a maximum term of five years, unless such loan is for the purchase of the participant’s primary residence, in which case the repayment period may not exceed thirty years from the date of the loan origination. Principal and interest are paid ratably through payroll deductions. Participant notes receivable are recorded in the financial statements at amortized cost (which represents unpaid principal plus accrued interest). Upon termination of a participant from employment, the participant’s loan shall continue to be payable in accordance with the provisions of the participant’s loan or be due in full.

Pursuant to the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act enacted in March 2020, Plan participants could request a delay of note repayments for repayments that occurred between March 27, 2020 and December 31, 2020. If a delay was granted, the participant’s note was reamortized and included any interest accrued during the period of delay. The ability to request a delay in note repayments under the CARES Act ceased as of December 31, 2020.

Payment of Benefits

Upon death, disability, retirement, or termination of service, a participant may receive a lump sum payment in the amount equal to the participant’s vested account balance within a reasonable period of time after termination of employment upon election by the participant. Accounts with balances less than $5,000 may be immediately distributed upon a distribution event. If the participant’s total vested balance is greater than $5,000, the participant may elect not to receive a distribution until required by law to receive required minimum distributions, pursuant to the CARES Act, participants who were currently receiving required minimum distributions were offered the option to waive their 2020 payment and participants who were due to receive the first required distribution in 2020 had their distribution automatically waived. The ability to request special waivers with respect to required minimum distributions under the CARES Act ceased as of December 31, 2020. The Plan allows hardship withdrawals in the event of undue financial hardship. Such withdrawal is limited to the participants’ pre-tax or Roth elective deferral contributions and earnings thereon. Benefits are recorded as distributions to participants when paid. The Plan also permits participants to request up to $100,000 in coronavirus-related distributions, with repayment terms of up to three years, in accordance with the CARES Act. The ability to request coronavirus-related distributions under the CARES Act ceased as of December 31, 2020.

Valuation of Investments and Income Recognition

Investments are recorded at fair value as reported to the Plan by the trustee. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See Note 3 for discussion of fair value measurements.

The net realized and unrealized investment gain or loss (net appreciation or depreciation in fair value of investments) is reflected on the accompanying statement of changes in net assets available for benefits and is determined as the difference between fair value at the beginning of the year (or date purchased if during the year) and selling price (if sold during the year) or year-end fair value. Purchases and sales of investments are recorded on a trade-date basis. Interest income is recognized on the accrual basis. Dividends are recognized on the ex-dividend date.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes in net assets available for benefits and disclosures. Accordingly, actual results could differ from those estimates.

Risks, Uncertainties, and Concentrations

The Plan provides for various investments that, in general, are exposed to various risks, such as interest rate, credit, and overall market volatility risks. Due to the level of risk associated with certain investments, it is reasonably possible that changes in the value of investments will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported on the statements of net assets available for benefits.

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Notes to Financial Statements

December 31, 2020

During 2020, the global outbreak of COVID-19, which was declared a pandemic by the World Health Organization in March, has led to significant volatility in financial markets. The ultimate impact of COVID-19 on the Plan, which may be material, is uncertain and will depend on future developments.

Additionally, some investments held by Principal are invested in the securities of foreign companies, which involve special risks and considerations not typically associated with investing in companies in the United States of America. These risks include devaluation of currencies, less reliable information about issuers, different securities transaction clearance and settlement practices, and possible adverse political and economic developments. Moreover, securities of many foreign companies and their markets may be less liquid and their prices more volatile than those of securities of comparable U.S. companies.

Subsequent Events

The financial statements and related disclosures include evaluation of events up through and including June [xx], 2021, which is the date the financial statements were available to be issued.

Note 2—Reconciliation of the Financials Statements to Form 5500

The following is a reconciliation of the increase in net assets available for benefits per the financial statements to Form 5500 for the year ended December 31, 2020 and 2019.


	December 31, 2020
Net assets available for benefits per the financial statements	$	79,377,498
Employer contribution receivable	(2,338,995)
Net assets available for benefits per the Form 5500	$	77,038,503


	Year ended
	December 31, 2020
Net decrease in assets available for benefits per the financial statements	$	(16,895,324)
Employer contribution receivable	(2,338,995)
Net decrease in assets available for benefits per the Form 5500	$	(19,234,319)

Note 3—Fair Value Accounting

Generally accepted accounting principles require disclosure about how fair value is determined and establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2: Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3: Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The following tables set forth by level, within the fair value hierarchy, the Plan’s investments measured at fair value on a recurring basis.

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Notes to Financial Statements

December 31, 2020

As of December 31, 2020:


Description	Level 1		Level 2		Level 3		Total
Mutual funds	$	20,790,673	$	—	$	—	$	20,790,673
Company stock	523,171		—		—		523,171
Total	21,313,844		—		—		21,313,844

Investments measured at net asset value*							$	51,382,956
Total investments at fair value							$	72,696,800

As of December 31, 2019:


Description	Level 1		Level 2		Level 3		Total
Mutual funds	$	18,723,709	$	—	$	—	$	18,723,709
Company stock	387,016		—		—		387,016
Total	19,110,725		—		—		19,110,725

Investments measured at net asset value*							71,272,005
Total investments at fair value							$	90,382,730

*Investments measured at net asset value (“NAV”) have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation to total investments at fair value.

The valuation technique used to measure the fair value of the mutual funds and common stock was based on quoted prices in active markets for identical assets that the Plan has the ability to access at the measurement date (market approach).

There were no changes to the valuation techniques used during the period.

Reported Net Asset Values

The Plan’s investments in pooled separate account and common/collective investment trusts had a value of $51,382,956 and $71,272,005 as of December 31, 2020 and 2019, respectively, determined based upon the NAV of the underlying assets and securities, the majority of which have observable Level 1 pricing inputs, including publicly quoted prices and quoted prices for similar assets in active or non-active markets (market approach). The NAV is used as a practical expedient to approximate fair value. The NAV investments have no unfunded commitments, can be redeemed daily, and have daily redemption notice periods.

Note 4—Income Taxes

The Plan did not obtain a plan-specific determination letter, as it operates with the trustee’s opinion letter, which was issued on the basic Plan document dated August 8, 2014. The Plan has been subsequently amended. The Plan administrator believes that the Plan continues to be operated and administered in compliance with the applicable requirements of the Internal Revenue Code.

Generally accepted accounting principles require Plan management to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress.

In February 2020, the Company submitted to the IRS a compliance statement under the IRS’ Voluntary Correction Program (“VCP”) to resolve certain Plan discrepancies identified relating to the definition of compensation during a compliance review conducted by the Company. In October 2020, the IRS approved the corrections of the discrepancies disclosed in the compliance statement, including the calculation method for the missed participant deferrals and related Company match. A total of $2,338,995 was paid by the Company to the Plan in March 2021 to account for the missed participant deferrals, Company match, and corresponding lost investment returns, which has been recorded as a contribution receivable as of December 31, 2020.

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LIBERTY OILFIELD SERVICES 401(K) SAVINGS PLAN

Note 5—Administration of the Plan

The Company provides, at no cost to the Plan, certain administrative, accounting, and legal services to the Plan and also pays the cost of certain outside services for the Plan.

Note 6—Plan Termination

Although it has not expressed any intent to do so, the Company has the right under the Plan to terminate the Plan subject to the provisions of ERISA. If the Plan is terminated for any reason, all participants become 100% vested, and the Plan administrator is to distribute each participant’s interest to the participant or the participant’s beneficiary.

Note 7—Related Party and Party-in-Interest Transactions

Certain Plan investments are managed by Principal. Principal is the asset trustee, as defined by the Plan; therefore, these transactions qualify as party-in-interest and are exempt from the prohibited transaction rules. In addition, the Plan provides for notes to participants, which are also party-in-interest transactions that are exempt from the prohibited transaction rules.

SUPPLEMENTAL SCHEDULES

Schedule H, Line 4a - Schedule of Delinquent Participant Contributions

As of December 31, 2020

Employer Identification Number ‑ 45-3073116

Plan Number – 001


	Participant Contributions Transferred Late to Plan		Total that Constitute Nonexempt Prohibited Transactions
	Check here if Late Participant Loan Repayments are included: ☐		Contributions Not Corrected		Contributions Corrected Outside VFCP		Contributions Pending Correction in VFCP		Total Fully Corrected Under VFCP and PTE 2002-51
2019	$	886	$	—	$	886	$	—	$	—

- 9 -

Schedule H, Part IV, Line 4i ‑ Schedule of Assets (Held at End of Year)

As of December 31, 2020

Employer Identification Number ‑ 45-3073116

Plan Number ‑ 001

(a)

(b) Identity of Issue, Borrower, Lessor, or Similar Party

(e) Current Value

Mutual funds

Fidelity

500 Index

3,888,053

Fidelity

Large-Cap Growth Index

3,052,279

T. Rowe Price

New Horizons

2,869,644

MFS

Value

1,249,987

Fidelity

Mid-Cap Index

992,613

Goldman Sachs

International Growth

964,247

Fidelity

Small-Cap Index

902,900

Vanguard

Wellington

899,589

MassMutual

Mid-Cap Growth Institutional

870,194

Oppenheimer

Developing Markets

855,598

PIMCO

Investment Grade Corporate Bond

847,030

Vanguard

Short-Term Federal

654,820

Goldman Sachs

Financial Square Treasury Solutions

632,782

Vanguard

Small-Cap Value Index

507,589

Victory Sycamore

Established Value

493,023

American Funds

U.S. Government Securities

341,786

Vanguard

Energy

319,192

PGIM

High Yield

249,535

American Century

Inflation-Adjusted Bond

199,812

Total mutual funds

20,790,673

Common/collective investment trusts

Principal

Target 2050 Fund

10,669,130

Principal

Target 2055 Fund

10,250,500

Principal

Target 2045 Fund

8,034,614

Principal

Target 2040 Fund

6,006,207

Principal

Target 2030 Fund

4,239,369

Principal

Target 2035 Fund

4,023,778

Principal

Target 2060 Fund

3,842,383

Principal

Target 2025 Fund

1,732,424

Principal

Target 2020 Fund

916,080

Principal

Income Fund

457,262

Principal

Target 2015 Fund

342,898

Principal

Target 2065 Fund

248,259

Principal

Target 2010 Fund

43,397

Total common/collective investment trusts

50,806,301

- 10 -

(Continued from the previous page)

Pooled separate account

Principal

Real Estate Securities Separate Account

576,655

Total pooled separate account

576,655

Common stock

Liberty Oilfield Services Inc.

523,171

Total common stock

523,171

Participant notes receivable

Participant notes receivable, interest rate of 4.25% to 6.50%, collateralized by participants’ vested account balances

4,341,305

77,038,105

* Party-in-interest

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INDEX TO EXHIBITS


Exhibit No.						Description

23.1						Consent of Plante & Moran, PLLC *

* Filed herewith.

- 12 -

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the plan administrator has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.