UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrantx

Filed by a Party other than the Registrant¨

Check the appropriate box:

LAYNE CHRISTENSEN COMPANY

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

LAYNE CHRISTENSEN COMPANY

May __, 2014[•], 2015

Dear Stockholder:

You are cordially invited to attend the Annual Meeting of Stockholders of Layne Christensen Company to be held at the Company’s Corporate Headquarters at 1800 Hughes Landing Blvd., Suite 700, The Woodlands, Texas 77380 on Friday, June 6, 2014,5, 2015, commencing at 10:00 a.m., local time. The business to be conducted at the meeting is described in the attached Notice of Annual Meeting and Proxy Statement. In addition, there will be an opportunity to meet with members of senior management and review the business and operations of the Company.

Your Board of Directors joins with me in urging you to attend the meeting. Whether or not you plan to attend the meeting, however, please sign, date and return the enclosed proxy card promptly. A prepaid return envelope is provided for this purpose. You may revoke your proxy at any time before it is exercised and it will not be used if you attend the meeting and prefer to vote in person.

Sincerely yours,

/s/ ReneMichael J. RobichaudCaliel

ReneMichael J. RobichaudCaliel

President and Chief

Executive Officer

LAYNE CHRISTENSEN COMPANY

1800 Hughes Landing Boulevard, Ste. 700

The Woodlands, TX 77380

NOTICEOF ANNUAL MEETINGOF STOCKHOLDERS

TOBE HELDON JUNE 6, 20145, 2015

The Annual Meeting of Stockholders of Layne Christensen Company, a Delaware corporation (“Layne Christensen” or the “Company”), will be held at the Company’s Corporate Headquarters at 1800 Hughes Landing Blvd., Suite 700, The Woodlands, Texas, 77380, on Friday, June 6, 2014,5, 2015, commencing at 10:00 a.m., local time, and thereafter as it may from time to time be adjourned, for the following purposes:

The Board of Directors of Layne Christensen has fixed the close of business on April 15, 2014,13, 2015, as the record date for determination of the stockholders entitled to notice of, and to vote at, the Annual Meeting and any adjournment or adjournments thereof.

All stockholders are cordially invited to attend the meeting. Whether or not you intend to be present at the meeting, the Board of Directors of Layne Christensen encourages you to sign, date and return the enclosed proxy card promptly. A prepaid return envelope is provided for this purpose. You may revoke your proxy at any time before it is exercised and it will not be used if you attend the meeting and prefer to vote in person. Your vote is important and all stockholders are urged to be present in person or by proxy.

By Order of the Board of Directors,

Steven F. Crooke

Senior Vice President—President — Chief Administrative Officer,

General Counsel and Secretary

May __, 2014[•], 2015

The Woodlands, Texas

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be held on June 6, 2014:5, 2015: The Proxy Statement and Annual Report to Stockholders are available to you athttp://www.edocumentview.com/LAYN.LAYN.

LAYNE CHRISTENSEN COMPANY

1800 Hughes Landing Boulevard, Ste. 700

The Woodlands, TX 77380

PROXY STATEMENT

ANNUAL MEETINGOF STOCKHOLDERS

TOBE HELD JUNE 6, 20145, 2015

INTRODUCTION

This Proxy Statement is being furnished to the stockholders of Layne Christensen Company, a Delaware corporation (“Layne Christensen” or the “Company”), in connection with the solicitation of proxies by the Board of Directors of the Company for use at the Annual Meeting of Stockholders to be held on June 6, 2014,5, 2015, and at any adjournment or adjournments thereof (the “Annual Meeting”). The Annual Meeting will commence at 10:00 a.m., local time, and will be held at the Company’s Corporate Headquarters at 1800 Hughes Landing Blvd., Suite 700, The Woodlands, Texas 77380.

This Proxy Statement and the enclosed form of proxy were first mailed to the Company’s stockholders on or about May __, 2014.[•], 2015.

Proxies

You are requested to complete, date and sign the enclosed form of proxy and return it promptly to the Company in the enclosed postage prepaid envelope. Shares represented by properly executed proxies will, unless such proxies have been revoked prior to exercise, be voted in accordance with the stockholders’ instructions indicated in the proxies. If no instructions are indicated, such shares will be voted in favor of the election of the nominees for director named in this Proxy Statement; in favor of the approval of the compensation of our Named Executive Officers,named executive officers, as disclosed in the proxy statement;this Proxy Statement; in favor of amending and restating the Certificateflexible settlement feature of Incorporation to authorize the issuanceCompany’s 4.25% Convertible Notes Due 2018; in favor of an additional 30,000,000increasing the number of shares of the Company’s Common Stock (the term “Common Stock” is hereinafter defined under Item 3); in favor4) that are potentially issuable upon the conversion of amending the Company’s 2006 Equity Incentive Plan to increase the number of shares available for issuance under the 2006 Equity Incentive Plan, authorize the issuance of a new form of award and extend the expiration date of the 2006 Equity Incentive Plan to June 6, 2024;8.00% Senior Secured Second Lien Convertible Notes; in favor of ratifying the selection of the accounting firm of Deloitte & Touche LLP as the Company’s independent auditors for the current fiscal year; and, as to any other matter that properly may be brought before the Annual Meeting, in accordance with the discretion and judgment of the appointed proxies. A stockholder who has given a proxy may revoke it at any time before it is exercised at the Annual Meeting by filing written notice of revocation with the Secretary of the Company, by executing and delivering to the Secretary of the Company a proxy bearing a later date, or by appearing at the Annual Meeting and voting in person.

If you plan to attend the Annual Meeting and vote in person, you will be given a ballot when you arrive. However, if your shares are held in the name of your broker, bank or other nominee (commonly referred to as being held in “street” name), proof of ownership may be required for you to be admitted to the meeting. A recent brokerage statement or letter from a bank or broker are examples of proof of ownership. If you want to vote your shares of Common Stock held in street name in person at the meeting, you will have to get a written proxy in your name from the broker, bank or other nominee who holds your shares.

Voting at the Meeting

For purposes of voting on the proposals described herein, the presence in person or by proxy of stockholders holding a majority of the total outstanding shares of the Company’s Common Stock shall constitute a quorum at the Annual Meeting. Only holders of record of shares of the Company’s Common Stock as of the close of business on April 15, 201413, 2015 (the “Record Date”), are entitled to notice of, and to vote at, the Annual Meeting or any adjournment or adjournments thereof. As of the Record Date, 19,831,63419,643,551 shares of the Company’s Common Stock were outstanding and entitled to be voted at the Annual Meeting. Each share of Common Stock is entitled to one vote on each matter properly to come before the Annual Meeting.

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Directors are elected by a plurality (a number greater than those cast for any other candidates) of the votes cast, in person or by proxy, of stockholders entitled to vote at the Annual Meeting for that purpose. In accordance with Delaware law, a stockholder entitled to vote in the election of directors can withhold authority to vote for all nominees for director or can withhold authority to vote for certain nominees for director. Votes withheld in connection with the election of one or more nominees for director will not be counted as votes cast for such nominees, and will not have any effect on the outcome of the election. With regard to the proposed amendment and restatement of the Certificate of Incorporation (Item 3), the affirmative vote of the holders of a majority of the outstanding shares of Common Stock entitled to vote thereon is required to approve the proposed amendment. Because the vote is based on the total number of shares outstanding rather than the votes cast at the Annual Meeting, abstentions and broker non-votes will have the same effect as a vote against Item 3. All other matters will be determined by a vote of a majority of the votes cast affirmatively or negatively by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon. Under Delaware law, except as described above with respect to Item 3 where the vote is based on the total number of shares outstanding, abstentions are not considered votes cast and will have no effect on whether a matter is approved.

On certain routine matters, such as the ratification of the selection of Deloitte & Touche LLP as the independent registered public accounting firm of the Company, if a stockholder that holds its shares through a broker does not provide instructions to that broker on how the stockholder wishes to vote, the broker will be allowed to exercise discretion and vote on behalf of the stockholder. A broker is prohibited, however, from voting on other non-routine matters, including the election of directors, the advisory vote on executive compensation, the amendment and restatementflexible settlement feature of the CertificateCompany’s 4.25% Convertible Notes Due 2018, and increasing the number of Incorporation and amendments toshares of the 2006 Equity Incentive Plan.Company’s Common Stock that are potentially issuable upon the conversion of the Company’s 8.00% Senior Secured Second Lien Convertible Notes. Broker “non-votes” will occur when a broker does not receive voting instructions from a stockholder on a non-routine matter or if the broker otherwise does not vote on behalf of a stockholder. Broker non-votes will not count in determining the number of votes cast with respect to the election of directors or a proposal that requires a majority of votes cast and, therefore, will not affect the outcome of the election of directors or the voting on such a proposal. However, as described above with respect to Item 3, where the vote is based on the total number of shares outstanding rather than votes cast, broker non-votes have the same effect as a vote against the proposal.

Solicitation of Proxies

This solicitation of proxies for the Annual Meeting is being made by the Company’s Board of Directors, which is sometimes referred to in this Proxy Statement as the Board. The Company will bear all costs of such solicitation, including the cost of preparing and mailing this Proxy Statement and the enclosed form of proxy. After the initial mailing of this Proxy Statement, proxies may be solicited by mail, telephone, facsimile transmission, electronically or personally by directors, officers, employees or agents of the Company. Brokerage houses and other custodians, nominees and fiduciaries will be requested to forward soliciting materials to beneficial owners of shares held of record by them, and their reasonable out-of-pocket expenses, together with those of the Company’s transfer agent, will be paid by the Company.

A list of stockholders entitled to vote at the Annual Meeting will be available for examination at least ten days prior to the date of the Annual Meeting during normal business hours at the Company’s Corporate Headquarters, 1800 Hughes Landing Boulevard, Ste. 700, The Woodlands, TX 77380. The list will also be available at the Annual Meeting.

ITEM 1

ELECTIONOF DIRECTORS

One of the purposes of this Annual Meeting is to elect six directors to serve one-year terms expiring at the Annual Meeting of Stockholders in 20152016 and until their successors are duly elected and qualified or until their earlier death, retirement, resignation or removal. The Company’s Board of Directors currently consists of seven directors, but will consist of six directors following the Annual Meeting.directors. The Board of Directors has designated Messrs. David A.B. Brown, Michael J. Caliel, J. Samuel Butler, Nelson Obus, Rene J. Robichaud,Robert R. Gilmore and John T. Nesser III and Robert R. Gilmore as the nominees proposed for election at the Annual Meeting. Messrs. Brown and Butler have been directors of the Company since 2003. Mr. Obus has been a director of the Company since 2004, Messrs. Robichaud and Gilmore have been directors of the Company since January 1, 2009 and Mr. Nesser has been a director of the Company since September 5, 2013. Mr. NesserCaliel was appointed to the Board on January 2, 2015 to fill a vacancy created by the retirementdeparture of Jeff ReynoldsRene J. Robichaud, our former Chief Executive Officer and President, on June 6, 2013.30, 2014. Mr. Nesser was recommended to the Board byCaliel has assumed Mr. Easter,Robichaud’s position as the Company’s President and Chief Financial Officer, who had previously worked with Mr. Nesser at another company.Executive Officer.

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Unless authority to vote for the nominees is withheld, it is intended that the shares represented by properly executed proxies in the form enclosed will be voted for the election of the nominees for director. In the event that one or more of the nominees should become unavailable for election, it is intended that the shares represented by the proxies will be voted for the election of such substitute nominee as may be designated by the Board of Directors, unless the authority to vote for the nominee who has ceased to be a candidate has been withheld. The nominees have indicated their willingness to serve as directors if elected, and the Board of Directors has no reason to believe that the nominees will be unavailable for election.

The Board of Directors unanimously recommends that you vote FOR“FOR” the election of David A.B. Brown, Michael J. Caliel, J. Samuel Butler, Nelson Obus, Rene J. Robichaud,Robert R. Gilmore and John T. Nesser III and Robert R. Gilmore as directors of the Company.

Nominees for Director

The following table sets forth certain information with respect to the persons nominated by the Board of Directors for election as directors at the Annual Meeting.

The business experience during the last five fiscal years of the persons nominated by the Board of Directors for election as directors at the Annual Meeting is as follows:

David A.B. Brown served as the Company’s interim President and CEO from June 25, 2014 through January 2, 2015. Mr. Brown also served as Chairman of the Board of Directors of Pride International, Inc. from 2005 until Pride’s acquisition by Ensco Plc in 2011, at which time he became a member of the Board of Directors of Ensco Plc.Plc and served in such capacity until May 2014. He is also on the board of directors of EMCOR Group, Inc., and from 1984 to 2005 Mr. Brown was president of The Windsor Group, a consulting firm that focused on strategic issues facing oilfield services and engineering companies. He is a Chartered Accountant and CPA and has over 40 years of energy-related experience. Mr. Brown’s pertinent experience, qualifications, attributes and skills include: financial literacy and extensive managerial experience attained from serving as the president of The Windsor Group, and the chairman of Pride International, Inc., and the interim President and Chief Executive Officer of the Company, the knowledge and experience he has attained from service on other public company boards, and the knowledge and experience he has attained from his service on the Company’s Board since 2003, and in his capacity as the Company’s Chairman since 2005.

Michael J. Caliel was appointed President and Chief Executive Officer of the Company on January 2, 2015. Mr. Caliel has 30 years of global sales, management and operating experience. From 2011 to 2014, Mr. Caliel served as President and Chief Executive Officer of the Invensys Software and Industrial Automation Division of Invensys plc, a LSE-listed global software, systems and technology company that serves both manufacturing and infrastructure industries. From 2006 to 2011, Mr. Caliel served as President, CEO, and Executive Director of Integrated Electrical Services, Inc., a Nasdaq-listed national provider of electrical and communications solutions for the commercial, industrial and residential markets. Mr. Caliel’s pertinent experience, qualifications, attributies and skills include: extensive managerial and operational experience attained from serving as the President and CEO of Invensys Software, and as the President, CEO, and Executive Director of Integrated Electrical Services, Inc.

J. Samuel Butler has been president of Trinity Petroleum Management, LLC, an oil and gas management outsourcing company, since 1996. Mr. Butler has also served as chairman of the board, chief executive officer and president of ST Oil Company, an independent oil and gas exploration and production company, since 1996. Mr. Butler was appointed to the Colorado School of Mines Board of Governors in 2009, and in 2007, Mr. Butler became the chairman of Genesis Gas & Oil Partners LLC, a private oil and gas partnership focused on the acquisition and

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exploitation of coalbed methane and other unconventional oil and gas reserves. Mr. Butler’s pertinent experience, qualifications, attributes and skills include: financial literacy and extensive managerial experience attained from serving as the president, chairman and chief executive officer of two companies in the oil and gas industry, Trinity Petroleum Management, LLC and ST Oil Company, the knowledge and experience he has attained from service on other company boards, and the knowledge and experience he has attained from his service on the Company’s Board since 2003.

Nelson Obus has served as president of Wynnefield Capital, Inc. since November 1992 and as the managing member of Wynnefield Capital Management, LLC since January 1997. Wynnefield Capital Management manages two partnerships and Wynnefield Capital, Inc. manages one partnership, all three of which invest in small-cap value U.S. public equities. Mr. Obus served as a member of the board of directors of Gilman Ciocia, Inc., a company that provides income tax return preparation, accounting and financial planning services from September 2007 to January 2012. Mr. Obus is also a member of the board of directors of Breeze-Eastern Corporation, a company that designs, develops, manufactures, sells and services sophisticated mission equipment for helicopters. Mr. Obus’ pertinent experience, qualifications, attributes and skills include: financial literacy and expertise, capital markets expertise and managerial experience gained through his leadership roles and ownership interestinterests in related investment management companies, Wynnefield Capital Management, LLC and Wynnefield Capital, Inc., the knowledge and experience he has attained from service on other public company boards, and the knowledge and experience he has attained from his service on the Company’s Board since 2004.

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Robert R. Gilmore is an independent CPA. From 1997 to May 2006 and from March 2008 to present, Mr. Gilmore has served as an independent financial consultant to a number of companies. From May 2006 to February 2008, he was chief financial officer of NextAction Corporation, a private company engaged in multi-channel direct marketing using technology-based proprietary lead generation methods for the retail industry. Since April 2003, Mr. Gilmore has been a director of Eldorado Gold Corporation, serving as non-executive chairman of the board since December 2009. Since June 2010, Mr. Gilmore has been a director of Fortuna Silver Mines, Inc. Mr. Gilmore also served as a director of Global Med Technologies, Inc. from March 31, 2006, until March 2010. From July 2007 to March 2009, Mr. Gilmore was also a director of Frontera Copper Corporation. Mr. Gilmore was also a director of Ram Power Corporation from October 2009 until April 2010. Mr. Gilmore’s pertinent experience, qualifications, attributes and skills include: public accounting and financial reporting expertise (including extensive experience as a certified public accountant), managerial experience attained from serving as the chief financial officer of NextAction Corporation, the knowledge and experience he has attained from service on other public company boards, and the knowledge and experience he has attained from his service on the Company’s Board since 2009.

Rene J. Robichaud has served as President of the Company since September 2011 and as Chief Executive Officer since February 2012. Prior to coming to the Company, Mr. Robichaud served as a consultant to various corporate clients since 2008. Mr. Robichaud served as president and chief executive officer of NS Group, Inc., a publicly-traded manufacturer of oil country tubular goods and line pipe, from February 2000 until the company’s sale in December 2006. Prior to that, Mr. Robichaud served as president and chief operating officer of NS Group, Inc. from June 1999 to February 2000. From 1997 to 1998, Mr. Robichaud served as a managing director and co-head of the Global Metals & Mining Group for Salomon Smith Barney. Mr. Robichaud also served as a director of The Midland Company from 2006 to 2008. Mr. Robichaud’s pertinent experience, qualifications, attributes and skills include: managerial experience he has attained from serving as the President and Chief Executive Officer of the Company, and as the president, chief executive officer and chief operating officer of NS Group, Inc., financial literacy and expertise, capital markets expertise, and managerial expertise gained through his mergers and acquisitions experience and leadership roles with Salomon Smith Barney, and the knowledge and experience he has attained from his service on other public company boards and on the Company’s Board since 2009.

John T. Nesser III brings 40 years of executive, corporate, and legal experience to the Company, including a proven record of success in the international oil & gas, engineering & construction, and maritime industries. Since July 2013, Mr. Nesser has served as the co-founder, co-chief executive officer and manager of All Coast, LLC, the owner and operator of a large fleet of Liftboards for the offshore oil and gas market in the Gulf of Mexico. Beginning in 1998 through his retirement in July 2011, Mr. Nesser held positions of increasing responsibility at McDermott International, a NYSE-listed international engineering and construction company, including chief operating officer responsible for all worldwide operations, chief administrative and legal officer and general counsel. Prior to joining McDermott, Mr. Nesser spent seven yearsserved as a partner, and then 13 years as a co-foundingmanaging partner of two majorNesser, King and LeBlanc, a law firms.firm that he co-founded in 1985. Mr. Nesser also serves on the Board of Directors of Thermon Group Holdings, Inc. Mr. Nesser served on the Board of Directors of Seahawk Drilling Incorporated from August 2009 to October 2011. In February 2011, Seahawk Drilling Incorporated announced that substantially all of its assets would be sold to Hercules Offshore, Inc., such sale being implemented through a Chapter 11 bankruptcy filing, citing heavy losses due to the slow issuance of shallow water drilling permits following the April 2010 oil spill in the Gulf of Mexico and other factors. Mr. Nesser’s pertinent experience, qualifications, attributes and skills include: financial literacy and extensive managerial experience attained from serving as the chief operating officer of McDermott International, legal experience attained from serving as the general counsel of McDermott International and practicing law at a private law firm that he founded,co-founded, the knowledge and experience he has attained from service on other public company boards, and the knowledge and experience he has attained from his service on the Company’s Board since 2013.

There is no arrangement or understanding between any director and any other person pursuant to which such director was selected as a director of the Company.

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Compensation of Directors

For fiscal 2014,2015, each director of the Company who was not also an employee of the Company, except the Chairman of the Board and Mr. Nesser,Anthony Helfet, received an annual retainer of $50,000.$47,500. Mr. NesserHelfet received a prorated retainer in the amount of that retainer of $15,934$25,000 for fiscal 20142015, in light of his partial year of service during fiscal 2014.2015. The Chairman of the Board received an annual retainer of $75,000$37,500 for fiscal 2014.2015 for his service for the portion of fiscal 2015 during which he was not serving as interim President and Chief Executive Officer. The Chairmen of the Audit, the Compensation and the Nominating & Corporate Governance Committees received additional annual retainers of $15,000, $10,000 and $5,000, respectively, for fiscal 2014.2015. All such retainers were payable in quarterly installments. In addition, each non-employee director received $1,500 for each board meeting he attended either in person or via teleconference and each member of the Audit, the Compensation and the Nominating & Corporate Governance Committeescommittees received $1,500 for each committee meeting he attended either in person or via teleconference during fiscal 2014.2015. As an additional component of their compensation packages, all non-employee directors of the Company receive a onetimeone-time award of an option to purchase 3,000 shares of the Company’s Common Stock upon becoming a member of the Board. For fiscal 2014,2015, each non-employee director, except the Chairman, and Mr. Nesser, also received an annual award of restricted stock or stock options of the Company, or a combination of both, whichever theyhe chose, with a value approximately equal to $50,000 on the date of the award. For fiscal 2014,2015, the Chairman received an annual award of either restricted stock or stock options of the Company or a combination of both, whichever he chose, with a value equal to $75,000 on the date of the award and Mr. Nesser, who did not join the Board until September 2013, did not receive an equity award. However, Mr. Nesser did receiveas consideration for his onetime award of an option to purchase 3,000 shares of the Company’s Common Stock on September 5, 2013.services as a director. The annual equity award for fiscal 20142015 was made on AprilMay 1, 2013.2014. The restricted stock is valued based on the market price of the Company’s Common Stock on the day the stock is issued, vests one year from the date of issuance, and is otherwise subject to all of the terms and conditions of the Company’s 2006 Equity Incentive Plan, or such other plan under which the restricted stock may be issued. The director options have an exercise price equal to the market price of the Common Stock on the day they were issued, are 100% vested upon issuance, have a ten-year life and are otherwise subject to all of the terms and conditions of the 2006 Equity Incentive Plan or such other plan under which the options may be issued. Directors of the Company who are also employees of the Company receive no compensation for service to the Company as directors.

A director may elect to defer receipt of all or a portion of his cash compensation in accordance with the terms of the Company’s Deferred Compensation Plan for Directors. Under the Company’s Deferred Compensation Plan for Directors, non-employee directors of the Company can elect to receive deferred compensation in three forms—a cash credit, a stock credit or a combination of the two. The value of deferrals made in the form of a stock credit track the value of the Company’s Common Stock. Deferrals made in the form of a cash credit will accumulate interest at a rate based on the annual yield of the longest term United States Treasury Bond outstanding at the end of the preceding year. All payments made under the plan will be made in cash. As of January 31, 2014,2015, Mr. Brown had accumulated the equivalent of 11,494.8015,370.72 shares of Common Stock in his stock credit account, Mr. Butler had accumulated the equivalent of 2,939.76 shares of Common Stock in his stock credit account, Mr. Helfet had accumulated the equivalent of 3,182.25 shares of Common Stock in his stock credit account, Mr. Obus had accumulated the equivalent of 11,481.08 shares of Common Stock in his stock credit account, Mr. Gilmore had accumulated the equivalent of 468.7515,253.55 shares of Common Stock in his stock credit account and Mr. RobichaudGilmore had accumulated the equivalent of 4,754.77762.97 shares of Common Stock in his stock credit account. Mr. Nesser and Mr. Helfet had no shares of Common Stock in histheir respective stock credit account.accounts.

The following table sets forth the compensation paid to our directors during the fiscal year ended January 31, 2014.2015. Because Mr. Brown (in his capacity as interim President and CEO), Mr. Caliel and Mr. Robichaud was our only director who waswere were also an employee ofemployed by the Company during the fiscal year. Mr. Robichaud’syear, their compensation is reported in our Summary Compensation Table.Table and not in the following table.

Fiscal 20142015 Director Compensation Table

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Meetings of the Board and Committees

During the fiscal year ended January 31, 2014,2015, the Company’s Board of Directors held tenthirteen meetings. All directors attended at least 75% of the meetings of the Board of Directors and the committees of the Board of Directors on which they served that were held during such fiscal year and during the period which such director served. It should be noted that the Company’s directors discharge their responsibilities throughout the year, not only at such Board of Directors and committee meetings, but through personal meetings and other communications with members of management and others regarding matters of interest and concern to the Company.

The Company has a policy encouraging its directors to attend the Annual Meeting of Stockholders. All directors then serving attended the Company’s 20132014 Annual Meeting.

Pursuant to the Company’s Bylaws, the Board of Directors has established an Audit Committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act, as amended, a Nominating & Corporate Governance Committee and a Compensation Committee.

Audit Committee

The Audit Committee assists the Board of Directors in fulfilling its responsibilities with respect to the oversight of (i) the integrity of the Company’s financial statements, financial reporting process and internal control system; (ii) the Company’s compliance with legal and regulatory requirements; (iii) the independent registered public accounting firm qualifications and independence; (iv) the performance of the Company’s internal audit function and its independent auditors and (v) the system of internal controls and disclosure controls and procedures established by management. The Audit Committee is responsible for the appointment of the Company’s independent registered public accounting firm and the terms of their engagement, reviewing the Company’s policies and procedures with respect to internal auditing, accounting, financial and disclosure controls and reviewing the scope and results of audits and any auditor recommendations. The Audit Committee held four meetings during the fiscal year ended January 31, 2014,2015, in addition to personal meetings and other communications conducted throughout the year with members of management and each other regarding issues within the committee’s area of responsibility. The Amended and Restated Audit Committee Charter is available on the Company’s website under the heading “Governance” on the Investor Relations page (http:(http://investor.laynechristensen.com/governance.cfm)governance.cfm). The current members of the Audit Committee are Robert R. Gilmore (Chairperson), J. Samuel Butler, Nelson Obus and Nelson Obus.John T. Nesser III. All of the members of the Audit Committee are independent within the meaning of SEC Regulationsregulations and the NASDAQ listing standards. The Board has determined that each memberall members of the Audit Committee iscommittee are qualified as an audit committee financial expertexperts within the meaning of SEC regulations and that all such members are financially literate and have experience in finance or accounting resulting in their financial sophistication within the meaning of the NASDAQ listing standards. The Report of the Audit Committee for fiscal year 20142015 appears below.

THE FOLLOWING REPORT OF THE AUDIT COMMITTEE DOES NOT CONSTITUTE SOLICITING MATERIAL AND SHOULD NOT BE DEEMED FILED OR INCORPORATED BY REFERENCE INTO ANY OTHER COMPANY FILING UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES EXCHANGE ACT OF 1934, EXCEPT TO THE EXTENT THE COMPANY SPECIFICALLY INCORPORATES THIS REPORT BY REFERENCE THEREIN.

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REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Board of Directors is composed of independent directors as required by and in compliance with the listing standards of the NASDAQ Stock Market. The Audit Committee operates pursuant to a written charter adopted by the Board of Directors.

The functions of the Audit Committee are set forth in its charter. One of the Audit Committee’s principle functions is overseeing the Company’s financial reporting process on behalf of the Board of Directors. Management of the Company has the primary responsibility for the Company’s financial reporting process, principles and internal controls as well as preparation of its financial statements. The Company’s independent registered public accounting firm is responsible for performing an audit of the Company’s financial statements and expressing an opinion as to the conformity of such financial statements with accounting principles generally accepted in the United States.

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The Audit Committee has reviewed and discussed the Company’s audited financial statements as of and for the year ended January 31, 2014,2015, with management and the independent registered accounting firm. The Audit Committee has discussed with the independent registered accounting firm the matters required to be discussed under Public Company Accounting Oversight Board (United States) (“PCAOB”) Auditing Standard No. 16, “Communications with Audit Committees.” The independent registered public accounting firm has provided to the Audit Committee the written disclosures under applicable requirements of the PCAOB, and the Audit Committee has discussed with the auditors their independence from the Company. The Audit Committee has also considered whether the independent registered public accounting firm’s provision of information technology and other non-audit services to the Company is compatible with maintaining the registered public accounting firm’s independence. The Audit Committee has concluded that the independent registered public accounting firm is independent from the Company and its management.

Based on the reports and discussions described above, the Audit Committee has approved the inclusion of the Company’s audited financial statements and Management’s Report on Internal Control Over Financial Reporting in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2014,2015, which was filed with the Securities and Exchange Commission.

Respectfully submitted on April[30], 2014, 24, 2015, by the members of the Audit Committee of the Board of Directors:

Robert R. Gilmore, Chairman

J. Samuel Butler

Nelson Obus

John T. Nesser III

Nominating & Corporate Governance Committee

The Nominating & Corporate Governance Committee (the “Nominating Committee”), in accordance with the process described below under the heading “Selection of Board Nominees,” identifies individuals qualified to become members of the Company’s Board of Directors, recommends to the Board proposed nominees for Board membership, recommends to the Board directors to serve on each standing committee of the Board and assists the Board in developing and overseeing corporate governance guidelines. The Nominating Committee’s evaluation of director nominees takes into account their ability to contribute to the diversity of age, background and experience represented on the Board, and the Nominating Committee reviews its effectiveness in balancing these considerations when assessing the composition of the Board. The Nominating & Corporate Governance Committee Charter is available on the Company’s website under the heading “Governance” on the Investor Relations page (http:(http://investor.laynechristensen.com/governance.cfm)governance.cfm). The Nominating Committee held three meetingsone meeting during the fiscal year ended January 31, 2014,2015, in addition to personal meetings and other communications conducted throughout the year with members of management and each other regarding issues within the committee’s area of responsibility. The current members of the Nominating Committee are J. Samuel Butler (Chairperson), David A.B. Brown, and Robert R. Gilmore. All of the members of the Nominating CommitteeGilmore, Nelson Obus and John T. Nesser. Messrs. Butler, Gilmore, Obus and Nesser are independent within the meaning of SEC regulations and the NASDAQ listing standards.standards and the Board of Directors has determined that Mr. Brown is independent under the SEC regulations and the Nasdaq listing standards other than during the time that he served as interim President and CEO.

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Compensation Committee

The Compensation Committee establishes annual and long-term performance goals and objectives for the Company’s management, evaluates the performance of management and makes recommendations to the Board of Directors regarding the compensation and benefits of the Company’s executive officers and the members of the Board of Directors. The Compensation Committee also administers certain of the Company’s incentive plans, including the Company’s Executive Incentive Compensation Plan. The Amended and Restated Compensation Committee Charter is available on the Company’s website under the heading “Governance” on the Investor Relations page (http:(http://investor.laynechristensen.com/governance.cfm)governance.cfm). The current members of the Compensation Committee are John T. Nesser III (Chairperson), David A.B. Brown, J. Samuel Butler, Robby Gilmore and Nelson Obus. All of the members of the Compensation CommitteeMessrs. Nesser, Butler, Gilmore and Obus are independent within the meaning of SEC regulations and the NASDAQ listing standards.standards and the Board of Directors has determined that Mr. Brown is independent under the SEC regulations and the Nasdaq listing standards other than during the time that he served as interim President and CEO. The Compensation Committee met fourseven times during the fiscal year ended January 31, 2014,2015, in addition to personal meetings and other communications conducted throughout the year with members of management and each other regarding compensation issues within the committee’s area of responsibility.

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Selection of Board Nominees

The Nominating Committee considers candidates for Board membership suggested by its members and other Board members, as well as management and stockholders. A stockholder who wishes to recommend a prospective nominee for the Board should notify the Company’s Secretary in writing with whatever supporting material the stockholder considers appropriate or that is required by the Company’s bylaws relating to stockholder nominations as described below under the heading “Advance Notice Procedures.” The Company’s Secretary will forward the information to the members of the Nominating Committee, who will consider whether to nominate any person nominated by a stockholder pursuant to the provisions of the proxy rules, the Company’s bylaws, the Company’s Nominating Committee Charter, the Company’s Corporate Governance Guidelines and the director selection procedures established by the Nominating Committee.

Once the Nominating Committee has identified a prospective nominee candidate, the Committee makes an initial determination as to whether to conduct a full evaluation of the candidate. This initial determination is based on the information provided to the Nominating Committee with the recommendation of the prospective candidate, as well as the Nominating Committee’s own knowledge of the candidate. This information may be supplemented by inquiries to the person making the recommendation or others. The preliminary determination is based primarily on the need for additional Board members to fill vacancies or expand the size of the Board and the likelihood that the prospective nominee can satisfy the criteria and qualifications described below. If the Nominating Committee determines, in consultation with the Chairman of the Board and other Board members as appropriate, that additional consideration is warranted, the Nominating Committee then evaluates the prospective nominees against the criteria and qualifications set out in the Company’s Corporate Governance Guidelines. Such criteria and qualifications include:

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However, as determining the specific qualifications or criteria against which to evaluate the fitness or eligibility of potential director candidates is necessarily dynamic and an evolving process, the Board believes that it is not always in the best interests of the Company or its stockholders to attempt to create an exhaustive list of such qualifications or criteria. Appropriate flexibility is needed to evaluate all relevant facts and circumstances in context of the needs of the Board and the Company at a particular point in time.

The Nominating Committee also considers such other relevant factors as it deems appropriate, including the current composition and diversity of age, background and experience of the Board, the balance of management and independent directors, the need for Audit Committee expertise and the evaluations of other prospective nominees. In connection with this evaluation, the Nominating Committee determines whether to interview the prospective nominees, and, if warranted, one or more members of the Nominating Committee, and others as appropriate, interview prospective nominees in person or by telephone. After completing this evaluation and interview, the Nominating Committee makes a recommendation to the full Board as to the persons who should be nominated by the Board, and the Board determines the nominees after considering the recommendation and report of the Nominating Committee.

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Leadership Structure of the Board

The Company’s Corporate Governance Guidelines do not require the separation of the roles of Chairman of the Board and Chief Executive Officer, as the Board believes that an effective board leadership structure can be highly dependent on the experience, skills and personal interaction between persons in leadership roles. Since 1992, other than during Mr. Brown’s service as interim Chief Executive Officer, the Company has separated the positions of chairman and chief executive officer. David A.B.During the period in which Mr. Brown servesserved as Chairman and interim Chief Executive Officer, the Board appointed John T. Nesser III to serve as lead independent director. Mr. Brown resumed his role as the independent chairman and Renefollowing the appointment of Michael J. Robichaud servesCaliel as the Chief Executive Officer of the Company. The Board believes this structure provides strong leadership for the Board, while also positioning the Chief Executive Officer as the leader of the Company in the eyes of our customers, employees and other stakeholders. The Board also believes that this structure has afforded the Company an effective combination of internal and external experience, continuity and independence that has served the Board and the Company well.

Chief Executive Officer Succession Planning

Assuring that the Company has the appropriate management talent to successfully pursue the Company’s strategies is one of the Board’s primary responsibilities. To fulfill this responsibility the Board has adopted a policy to assure that the Company has in place an appropriate plan to address succession should the Company’s Chief Executive Officer become unexpectedly unable to perform his duties, Chief Executive Officer succession in the ordinary course of business, and succession for key members of senior management. The Board annually reviews the senior executive team’s experience, skills, and competencies and assesses which, if any, of the executives possess, or have the ability to develop, attributes the Board believes are necessary to lead and achieve the Company’s goals. The Company’s succession plan is reviewed annually by the Board.

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Communications with the Board of Directors

The Board of Directors has approved a formal policy for stockholders to send communications to the Board or its individual members. Stockholders can send communications to the Board and specified individual Directors by mailing a letter to the attention of the Board or a specific Director (c/o the General Counsel) at Layne Christensen Company, 1800 Hughes Landing Boulevard, Ste. 700, The Woodlands, TX 77380, or by sending a message through the Company’s website athttp://investor.laynechristensen.com/contactus.cfm.contactus.cfm.

Upon receipt of a communication for the Board or an individual Director, the General Counsel will promptly forward any such communication to all the members of the Board or the individual Director or Directors, as appropriate. If a communication to an individual Director deals with a matter regarding the Company, the General Counsel will forward the communication to the entire Board, as well as the individual Director. Neither the Board nor a specific Director is required to respond to stockholder communications and when responding shall do so only in compliance with the Company’s Corporate Governance Guidelines.

Risk Oversight

The Board considers oversight of the Company’s risk management efforts to be a responsibility of the entire Board. The Board’s role in risk oversight includes receiving regular reports from members of senior management on areas of material risk to the Company, or to the success of a particular project or endeavor under consideration, including operational, financial, legal and regulatory, security, strategic and reputational risks. The full Board (or the appropriate Committee, in the case of risks that are under the purview of a particular Committee) receives these reports from the appropriate members of management to enable the Board (or Committee) to understand the Company’s risk identification, risk management, and risk mitigation strategies. When a report is vetted at the Committee level, the chairperson of that Committee subsequently reports on the matter to the full Board. This enables the Board and its Committees to coordinate the Board’s risk oversight role. The Board also believes that risk management is an integral part of Layne Christensen’s annual strategic planning process, which addresses, among other things, the risks and opportunities facing the Company.

Part of the Audit Committee’s responsibilities, as set forth in its charter, is to review with corporate management, the independent auditors and the internal auditors, if applicable, any legal matters, risks or exposures that could have a significant impact on the financial statements and the steps management has taken to minimize the Company’sCompany��s exposure. In this regard, the Company’s internal auditors prepare annually a comprehensive risk assessment report and review that report with the Audit Committee. This report identifies the material business risks for the Company, and identifies the Company’s internal controls that respond to and mitigate those risks. The Company’s management regularly evaluates these controls, and the Audit Committee is provided regular updates regarding the effectiveness of the controls. The Audit Committee regularly reports to the full Board.

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Risk Assessment of Compensation Policies

In March 2014,2015, the Company conducted a risk assessment of its compensation policies and practices. The Company’s compensation policies and practices were evaluated to ensure that they do not foster risk-taking above the level of risk associated with the Company’s business model. The Company considered the design and operation of its compensation arrangements, including the performance objectives and target levels used in connection with incentive awards, and evaluated the relationship between the Company’s risk management and these arrangements. The results of the assessment were then reported to the Compensation Committee. Based on this assessment, the Compensation Committee concluded that the Company has a balanced pay and performance program that does not encourage unnecessary or excessive risk-taking and that any risks arising from the Company’s compensation policies and practices for its employees are not reasonably likely to have a material adverse effect on the Company.

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Other Corporate Governance Matters

All of the members of the Board are independent within the meaning of SEC regulations and the NasdaqNASDAQ listing standards, with the exception of ReneMichael J. Robichaud.Caliel. Mr. RobichaudCaliel is considered an inside director because of his employment as an executive of the Company. During Mr. Brown’s service as interim President and CEO, he was not considered independent. Following such service, which did not last longer than a year, the Board of Directors determined that he is independent under applicable SEC regulations and the NASDAQ listing standards.

Transactions with Management/Related-Party Transactions

The Company considers any transaction that would require disclosure under Item 404(a) of Regulation S-K to be a related-party transaction. The Company has an Employee Conflict of Interest Policy that requires employees to identify potential conflicts of interest, including related-party transactions, to the Compliance Department. Furthermore, the Company’s Audit Committee must review and approve all related-party transactions that are required to be disclosed pursuant to Item 404(a) of Regulation S-K.

The Company was not a party to any transactions with any directors or executive officers of the Company during the last fiscal year requiring disclosure under the regulations of the Securities and Exchange Commission.

The Company has a Code of Business Conduct and Ethics that applies to all directors and employees of the Company, including the chief executive officer, chief financial officer and controller. The Code of Business Conduct and Ethics is available free of charge on the Company’s website under the heading “Governance” on the Investor Relations page (http:(http://investor.laynechristensen.com/governance.cfm)governance.cfm).

COMPENSATION DISCUSSION AND ANALYSIS

The following discussion and analysis of compensation arrangements of our Executivesnamed executive officers (which we refer to collectively as our “Executives”) for fiscal 2014 (as set forth in the Summary Compensation Table below)2015 should be read together with the compensation tables and related disclosures set forth below.

Executive Summary

Our compensation program for our Chief Executive Officer, Chief Financial Officer, our former Chief Financial Officer (who resigned as Chief Financial Officer effective May 6, 2013), and the three other most highly compensated executive officers as of the end of fiscal 2014 (which we refer to collectively as our “Executives”)Executives is designed to attract and retain top-quality executives, tie annual and long-term equity incentives to achievement of measurable corporate, business unit and individual performance objectives, and align the Executives’ incentives with stockholder value creation. To achieve these objectives, our executive compensation program emphasizes performance-based incentive compensation under our Executive Short-Term Incentive Plan (the “STI Plan”) and our Long-Term Incentive Plan (the “LTI Plan”), which aligns our Executives’ compensation with the Company’s financial performance and stock price, providing them with an incentive to maximize stockholder value.

Our Compensation Committee (the “Committee”) is responsible for establishing and overseeing the administration of annual and long-term performance goals for our Executives, as well as setting the overall compensation philosophy for the Company, subject to approval by the Board. Consistent with our strong pay-for-performance culture, the Committee seeks to tie the compensation of the Executives to the Company’s financial and stock performance.

As discussed below, fiscal 2015 was a year of transition for the Company’s leadership team. The leadership changes and the impact on the Company’s executive compensation program are described below under “—Leadership Changes in Fiscal 2015”. Several of the Executives (Messrs. Caliel, Brown and Atchison) did not participate in our full compensation program for fiscal 2015 due to the interim nature of their employment (in the case of Messrs. Brown and Atchison) or as a result of being hired late in the fiscal year (in the case of Mr. Caliel).

The Committee believes that its historical commitment to a strong pay-for-performance philosophy is evidenced by the fact that in the recent past, the Company’s executive officers have realized very little value from the equity awards that have been granted to them. For example, during the period from fiscal 20092011 through fiscal 2012, 181,7112015, over 845,000 shares of performance-contingent restricted stock, (“performanceperformance-contingent restricted stock units, (collectively, “performance shares”), and stock options, with an aggregate grant date fair market value of $4,608,133approximately $8.8 million were granted to our executive officers. As of January 31, 2014, however, the Company did not expect any of these performance shares to vest2015, due to Companythe decrease of the Company’s performance and stock price, the general business climate. Furthermore, the potential value that our executive officers could have realized as of January 31,

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2014,not been able to realize any value from all of the outstanding stock options (vested and unvested) that were grantedduring the last ten years was approximately $90,682, based on the difference between the closing price of our Common Stock on January 31, 2014, and the exercise price for each option.these awards.

Due to the general business climate and outlook for the Company, the Committee took a conservative approach for Executive salaries in fiscal 2014 and did not make any changes to the base salaries for the Executives.Executives in fiscal 2015, with the exception of providing a raise to Mr. Crooke in December 2014 in connection with assigning him the additional responsibility of serving as the Company’s Chief Administrative Officer.

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Under the STI Plan, our Executives had a primary goalperformance was linked to Company achievement of the Company achievingan EBITDA threshold of at least a 4% Return on Net Assets (“RONA”)$50.6 million for fiscal 2014,2015 (which was not met) and the achievement of individual performance goals. In addition, Mr. Purlee and Mr. Thalacker, as heads of our Inliner and Water Resources divisions, had the majority of their STI opportunity linked to achievement of an EBITDA threshold of at least $19.1 million at the Inliner division and $15.9 million at the Water Resources division, respectively, both of which was notwere met. As a result of the poor overall company financial performance, none of our Executives (other than Mr. Purlee and Mr. Thalacker) received any awards under the STI Plan for fiscal 2014.2015. See “Compensation Components—Short Term Incentive Plan—Awards for Fiscal 2014”2015”.

Under the LTI Plan for fiscal 2014,2015, the Committee recommended and the Board approved equity awards consisting of a combination of stock options, performance shares (which will vest only if the Company’s stock price significantly increases over the three yearthree-year period from the date of grant), and time-vestedtime-vesting restricted stock units (which are subject to a five-yearthree-year cliff vesting and cannot be sold until the Executive is no longer employed by the Company).

Additionally, the Committee recommended and the Board approved awards made in connection with the hiring of certain Executives.

The remainder of this Compensation Discussion and Analysis addresses the following topics in greater detail:

l           the objectives of our compensation program;

l          the role others play in designing and implementing our compensation program, including compensation consultants, peer groups and our Chief Executive Officer;

l           the components of compensation for our Executives, including the determination of base salaries, annual bonuses under our STI Plan and equity grants under our LTI Plan; and

l           the manner in which the Company addresses Internal Revenue Code limits on deductibility of compensation.

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identification of our named executive officers;

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leadership changes in fiscal 2015;

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the objectives of our compensation program;

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the role others play in designing and implementing our compensation program, including compensation consultants, peer groups and our Chief Executive Officer;

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the components of compensation for our Executives, including the determination of base salaries, annual bonuses under our STI Plan and equity grants under our LTI Plan; and

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the manner in which the Company addresses Internal Revenue Code limits on deductibility of compensation.

The compensation tables appear immediately following this Compensation Discussion and Analysis.

Named Executive Officers

Our “named executive officers” (referred to as “Executives” throughout) are the executive officers that are included in the Summary Compensation Table on page [•]. They include the following current officers:

Under applicable SEC rules, our Executives for fiscal 2015 also include the following former executive officers: Rene J. Robichaud (who resigned as Chief Executive Officer effective June 25, 2014), David A.B. Brown (who served as interim Chief Executive Officer from June 25, 2014 through January 2, 2015), James R. Easter (who resigned as Chief Financial Officer effective August 1, 2014), Gernot E. Penzhorn (whose position as Senior Vice President of Operations - International was eliminated effective January 30, 2015), and David D. Singleton (who resigned as Senior Vice President of Operations - Domestic effective January 30, 2015).

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Leadership Changes in Fiscal 2015

Fiscal 2015 was a year of transition for the Company’s leadership team. The leadership changes and the impact on the Company’s executive compensation program are described below.

Resignation of Rene J. Robichaud as Chief Executive Officer

Mr. Robichaud resigned from the Company effective June 25, 2014. His severance payments that are listed in the Summary Compensation Table are governed by the terms of his existing severance agreement with the Company dated July 29, 2011, which is described under “Executive Compensation and Other Information—Potential Payments Upon Change of Control, Retirement, Death or Disability.” Mr. Robichaud forfeited 52,500 restricted shares of Common Stock that were unvested as of the date of his termination of employment that were issued as part of a restricted stock inducement grant in connection with his hiring.

Hiring of David A. B. Brown as interim Chief Executive Officer

David A.B. Brown, our non-executive Chairman of the Board, served as the Company’s interim Chief Executive Officer from June 25, 2014 until the hiring of Mr. Michael Caliel, as Chief Executive Officer. Mr. Brown’s service as interim CEO makes him a “named executive officer” for purposes of the SEC’s disclosure rules. We entered into an agreement with Mr. Brown pursuant to which he agreed to serve as the CEO on an interim basis until Mr. Robichaud’s replacement was hired. The agreement provided for (i) an annual salary of $550,000 (prorated) to be paid in accordance with the Company’s normal payroll practices and (ii) a non-qualified stock option under the Company’s 2006 Equity Incentive Plan for the purchase of that number of shares of Common Stock determined by dividing $275,000 by the value of such option determined by the Company’s option pricing model as of June 25, 2014 (the date of grant), with an exercise price per share equal to the Fair Market Value (as defined in Company’s 2006 Equity Incentive Plan) of a share of the Company’s Common Stock as of June 25, 2014 and that was to vest upon the earlier of (a) one year of service (after June 25, 2014) on the Board or as the President and Chief Executive Officer of the Company or (b) the hiring of a successor President and Chief Executive Officer.

Compensation for Board of Director service (i.e., Board and committee fee amounts) was eliminated for the period that Mr. Brown served as interim CEO. While serving as interim CEO, Mr. Brown did not participate in the STI Plan or the LTI Plan. Mr. Brown was reimbursed for out of pocket travel and interim living expenses incurred in his interim CEO role. He did not serve on any Board Committees during his tenure as interim CEO. In connection with the hiring of Mr. Brown as the Company’s interim CEO, the Committee sought the advice of Frederic W. Cook & Co. (“F.W. Cook”), the Committee’s independent compensation consultant, regarding a compensation package for an interim chief executive officer. The Committee then made its recommendations to the Board, which then approved the agreement.

Due to the interim nature of Mr. Brown’s compensation package, the discussion in this Compensation Discussion and Analysis does not otherwise relate to Mr. Brown’s compensation as interim CEO, and references herein to the compensation of our Executives do not include Mr. Brown.

Hiring of Michael J. Caliel as Chief Executive Officer

Michael J. Caliel, the Company’s President and Chief Executive Officer, joined the Company on January 2, 2015. On December 8, 2014, the Company entered into an offer letter with Mr. Caliel relating to his service as the Company’s President and CEO. In connection with the hiring of Mr. Caliel as the Company’s Chief Executive Officer, the Committee sought the advice of F.W. Cook regarding a proposed compensation package for the Company’s Chief Executive Officer. The Committee then made its recommendations to the Board, which approved them. The offer letter provides for the benefits listed below.

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The vesting of the Inducement Option will accelerate and become fully vested upon a “change in control” (as defined in the Company 2006 Equity Incentive Plan). If Mr. Caliel is terminated without “cause” by the Company or he resigns for “good reason” (as defined therein), prior to the third anniversary of his start date, a pro rata portion of the Inducement Option will vest and be exercisable.

The vesting of the Inducement RSUs will accelerate and become fully vested upon a change in control. If Mr. Caliel is terminated without “cause” by the Company or he resigns for “good reason”, prior to the third anniversary of his start date, a pro rata portion of the Inducement RSUs will vest based on time assuming all performance conditions have been met.

If Mr. Caliel’s employment with the Company ends prior to the third anniversary of his start date for any other reason, he will forfeit the Inducement Option. After the third anniversary of his start date, if Mr. Caliel is terminated for “cause,” any unexercised portion of the Inducement Option will be immediately forfeited.

Vesting of the Inducement Cash will accelerate and become fully vested upon a “change in control”. If Mr. Caliel is terminated without “cause” or by Mr. Caliel for “good reason” prior to the third anniversary of his start date, a pro-rata portion of Inducement Cash will vest based on time assuming all performance conditions have been met.

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Mr. Caliel’s Inducement Grant was made pursuant to NASDAQ Listing Rule 5635(c)(4) and therefore the awards were made outside of the share limits of the 2006 Equity Incentive Plan. However, the award agreements provide that the awards are otherwise subject to the terms of Company’s 2006 Equity Incentive Plan.

Mr. Caliel also entered into a severance agreement with the Company providing for the payment of certain benefits under certain circumstances. See “Executive Compensation and Other Information—Potential Payments Upon Change of Control, Retirement, Death or Disability” below for descriptions of the amounts Mr. Caliel may receive upon a change in control, retirement, death or disability.

Due to the fact that Mr. Caliel was hired near the end of fiscal 2015 and did not participate in the STI Plan or the LTI Plan for fiscal 2015, the discussion in this Compensation Discussion and Analysis does not otherwise relate to Mr. Caliel’s compensation as CEO, and references herein to the compensation of our Executives do not include Mr. Caliel.

Resignation of James Easter as Chief Financial Officer

James Easter resigned from the Company effective August 1, 2014. Mr. Easter was not party to an employment or severance related agreement with the Company.

Appointment of Andrew Atchison as interim Chief Financial Officer

Following Mr. Easter’s resignation, Andrew Atchison, the Company’s former controller, agreed to serve as Chief Financial Officer of the Company effective August 1, 2014, on an interim basis until Mr. Easter’s replacement could be hired. Compensation for Mr. Atchison was set at an annual salary of $300,000 with no anticipated participation in the Company’s STI Plan or LTIP Plan. The Company did not enter into any employment-related agreements with Mr. Atchison. Since Mr. Atchison’s salary was significantly below Mr. Easter’s salary and the Committee did not expect Mr. Atchison to participate in the STI Plan or the LTI Plan, the Committee determined that it was not necessary to consult with F.W. Cook in connection with hiring Mr. Atchison.

On December 12, 2014, in order to reward Mr. Atchison for his exemplary service and dedication to the Company (and as a retention incentive), the Committee recommended, and the Board approved, the grant of a non-qualified stock option to acquire 25,000 shares of the Company’s common stock. The option will vest on the earlier of December 12, 2015 or the effective employment start date of the Company’s new Chief Financial Officer; provided that Mr. Atchison is employed by the Company on the vesting date. The per share option exercise price is $8.22, the closing price of the Company’s Common Stock on the date of grant (December 12, 2014) and has a 10 year maximum term and may be exercised for up to three years after Mr. Atchison’s termination of employment as interim CFO.

Due to the interim nature of Mr. Atchison’s compensation package, the discussion in this Compensation Discussion and Analysis does not otherwise relate to Mr. Atchison’s compensation as interim CFO, and references herein to the compensation of our Executives do not include Mr. Atchison.

Senior Vice Presidents of Operations

In January 2015, Mr. Caliel decided to streamline the management reporting structure of the Company and to have each of the division presidents report directly to the Chief Executive Officer rather than to the International and Domestic Senior Vice Presidents of Operations. This change was implemented effective as of January 30, 2015. In connection with this change, Mr. Singleton resigned as Senior Vice President of Operations—Domestic and Mr. Penzhorn’s position as Senior Vice President of Operations—International was eliminated. No severance is payable to Mr. Singleton in connection with his resignation. In connection with Mr. Penzhorn’s termination, the Company and Mr. Penzhorn entered into a letter agreement and Mr. Penzhorn provided a release of claims in favor of the Company. The terms of Mr. Penzhorn’s severance package are described under “Executive Compensation and Other Information—Potential Payments Upon Change of Control, Retirement, Death or Disability.”

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Objectives of Our Compensation Program

The Company’s compensation philosophy is to structure compensation to drive financial and strategic growth and build long-term stockholder value. The foundation of the Company’s compensation programs is based on the following core principles:

lPay for Performance– align incentive compensation with performance measures that motivate Executives and provide a linkage between the individual and his or her specific business division as well as the overall performance of the Company;

lReinforce “One Layne” Culture – through incentive design, drive behavior to achieve collaboration while never sacrificing the Company’s four core values of safety, sustainability, integrity and excellence;

lOffer Competitive Compensation – set target compensation opportunity to be competitive within the markets in which we operate;

lAlign with Stockholder Interests– structure compensation with performance measures that motivate executives to maximize stockholder value; and

lFocus on Both Short-term and Long-term Performance- provide a balanced compensation opportunity that rewards both short-term results and long-term strategic contributions which reinforce sustained business performance and discourage excessive risk-taking.

To achieve these objectives, the Committee implements and maintains compensation plans that tie a significant portion of the Executives’ overall compensation to our financial performance. The Committee generally believes that the Company’s target total target compensation program should be set at, or near, the 50^th percentile of the market. Based on the most recent benchmarking data provided by the Committee’s compensation consultant, the Company’s target total target compensation is slightly below the 50^th percentile of the benchmark data. See “Role of Peer Group” below. However, for the reasons discussed above in “Executive Summary,” the Company believes that the Executives’ realized total compensation for the past three fiscal years has likely been significantly below the 50^th percentile.

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Role of Compensation Consultants

To assist in carrying out its responsibilities, the Committee has from time to time retained independent consultants to provide advice on executive compensation and to perform specific tasks as requested by the Committee. Any consultant retained by the Committee reports directly to the Committee. On an annual basis the Committee reviews and assesses the independence and performance of any consultant then engaged in order to confirm that the consultant is independent, free of any potential conflicts and meets all applicable regulatory requirements.

For fiscal 2014,2015, the Committee engaged the independent compensation consulting firm of Frederic W.F.W. Cook & Co. (“on a limited basis to assist with specific situations, primarily related to the leadership changes at the Company discussed above. The Committee did not retain F.W. Cook”)Cook to (i) perform a competitive reviewan in depth market analysis for fiscal 2015. Instead, the Committee relied on the most recent market analysis prepared by F.W. Cook two years ago. The Committee determined that it was not necessary to update the market analysis given that base salaries were not increasing and analysis of executive officer base salary and other components ofthat no significant changes to the Company’s compensation program relativewere being proposed.

In addition, F.W. Cook provided advice to survey market data and the Company’s identified peer group, (ii) advise the Committee in connection with respect to evaluating whether any changes should be made to the Company’s identified peer group, (iii) conduct an overall reviewhiring of Mr. Brown as interim Chief Executive Officer and Mr. Caliel as the Company’s compensation program, including the relative mix of base salary and short- and long-term incentive compensation, and (iv) assist in the design of the Company’s short- and long-term incentive plans.Chief Executive Officer.

Role of the Peer Group

TheFrom time to time, the Committee directs its consultant to review the base salary and short- and long-term incentive levels of our Executives. In order to ensure that our compensation programs are market-based, the Committee’s consultant analyzes and matches the position and responsibilities of each Executive to proxy statement data from a peer group of companies.

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Peer groups require periodic review for fit to ensure that the peer framework continues to provide an appropriate benchmark for executive pay and company performance. As part of F.W. Cook’s fiscal 2014 engagement, the consultant recommended that the Company significantly revise its peer group for fiscal 2014. In doing so, F.W. Cook noted the unique challenges in creating a peer group for the Company given its three distinct lines of business and the limited number of comparator companies that provide a similar mix of services.

In selecting its peer group, F.W. Cook recommended that the Committee select companies based on similar industry classifications, organizational scope and size, financial metrics and comparable business operations. The Committee believes that the peer group consists of those companies for which executive compensation information is publicly available that are most comparable to the Company’s various businesses. However, several of the Company’s direct competitors are principally either privately held and/or incorporated in foreign jurisdictions that do not require public disclosure of executive compensation. Also, the uniqueness of the Company’s businesses results in a large number of companies in the peer group that are tangentially related to the Company or focused only on one of the Company’s lines of business. For these reasons, among others, the Committee recognizes that compensation comparisons are imperfect.

Based on the recommendation of F.W. Cook, the Company significantly revised its peer group at the beginning of fiscal 2014. No further changes were made to the peer group for fiscal 2015.

The peer group recommended by F.W. Cook and approved by the Committee for fiscal 2014 consistedcurrently consists of the 15 peer companies listed below.

The Committee believes the peer group data providedprovides additional insights regarding competitive pay data and pay mix. The Committee also uses general industry survey data for benchmarking purposes.

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Role of Executive Officers

Each of Rene J. Robichaud, our former Chief Executive Officer, David A.B. Brown, our former interim Chief Executive Officer, and Michael J. Caliel, our current Chief Executive Officer, regularly attended meetings of the Committee during fiscal 2014,2015 during the time such individual served as Chief Executive Officer, but, with the exception of Mr. Brown prior to his service as interim CEO, was not a member of the Committee and did not vote on Committee matters. Mr. Robichaud, wasMr. Brown and Mr. Caliel, during the time such individual served as CEO, were not present for certain portions of Committee meetings, such as when the Committee held executive sessions or discussed CEO compensation.

In late fiscal 2013,2014, Mr. Robichaud submitted compensation recommendations to the Committee for each of the Executives (other than himself). that were then serving as an Executive. Based on the general business climate and outlook for the Company, Mr. Robichaud recommended that the Company not make any changes to the Executives’ base salaries for fiscal 2014.2015. In addition, Mr. Robichaud recommended to the Committee the primary and secondary goals for each of the Executives under the STI Plan, the relative mix of the equity awards for the Executives under the LTI Plan and the performance criteria for the performance shares.

Mr. Brown submitted a recommendation to the Committee regarding the proposed compensation for Mr. Atchison.

Shortly after the end of fiscal 2014,2015, Mr. RobichaudCaliel provided recommendations to the Committee with respect to the payment of awards to the Executives under the STI Plan for 2014.2015. Mr. Caliel also submitted a recommendation to the Committee regarding the severance package for Mr. Penzhorn.

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Compensation Components

Our compensation program consists of the following components:four core components as described in more detail below: (i) base salary, (ii) a short-term incentive plan, (iii) a long-term incentive plan, and (iv) benefits and perquisites.

Base Salary

The Committee annually reviews base salaries, and recommends adjustments from time to time to realign our salaries with market levels paid by other companies for similar positions after taking into account individual performance, responsibilities, experience, autonomy, strategic perspectives and marketability, as well as the recommendation of the Chief Executive Officer.

Generally, the Committee believes that Executive base salaries should be targeted at, or near, the 50^th percentile for executives at competitive general industry companies in similar positions and with similar responsibilities. For fiscal 2014,2015, the Committee, with input from Mr. Robichaud prior to his resignation (for Executives other than himself), initially recommended to the Board that no changes be made to the Executives’ base salaries. This decision was based primarily on challenging economic conditions and the outlook for the Company. Effective December 4, 2014, the Committee appointed Mr. Crooke to the position of Chief Administrative Officer in addition to his existing duties as Senior Vice President—General Counsel. In connection with the hiring of Mr. Easter aspromotion, upon the Company’s Chief Financial Officer in May 2013, Mr. Robichaud recommended toBoard’s acceptance and recommendation, the Committee authorized the Company to increase Mr. Easter’sCrooke’s base salary based on input from Heidrick & Struggles, an independent executive search firm retained by management. The Committee approved such recommendation and recommended$362,250 to the Board that it approve Mr. Easter’s salary. The Board approved the Committee’s recommendations with respect to the Executives’ salaries for fiscal 2014.$400,000.

The table below lists the Executives’ annual base salaries for fiscal 2014.2015.

1         James R. Easter was elected Senior Vice President and Chief Financial Officer of the Company on May 6, 2013. The salary listed for Mr. Easter is his annualized salary.

2         Jerry W. Fanska resigned from his position as the Senior Vice President—Finance of the Company effective May 6, 2013. He continued as an employee of the Company at his current base salary until September 13, 2013. The salary listed for Mr. Fanska is his annualized salary.

Short Term Incentive Plan

Targets for Fiscal 20142015. Shortly beforeThe Committee and the beginning of fiscal 2014, F.W. Cook recommended toBoard have adopted the Committee that the Company adopt the Layne Christensen Company Short Term IncentiveSTI Plan (the “STI Plan”) for the purpose of providing incentives for Executives to promote the best interests and profitable operation of the Company. All of the Executives participated in the STI Plan in fiscal 2014.2015.

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The STI Plan is a short termshort-term incentive plan designed to annually reward and incent participants for their performance and contributions to the Company’s overall financial and operational performance. Pursuant to the STI Plan, participantsParticipants may receive awards based on the extent to which specified primarypre-established performance goals recommended by the CEO and secondary performance goalsapproved by the Committee are met during a one-year performance period. For each annualIn general, performance period, the Committee will establish the primary and secondary goals based on the CEO’s recommendations, subject to the Board’s approval. The primary goals will relate to corporate levelboth corporate-level and individual performance, (or division level performanceand in the case of a division president).presidents, division-level performance.

If the primary goal for an Executive is not achieved, then the Executive will not receive any award under the STI Plan. For all of the Executives, the primary goal for fiscal 2014 was the Company achieving a RONA of at least 4%. If the primary goal is achieved, then the Executive will be entitled to an award to the extent that the Executive’s secondary goals are achieved. Secondary goals relate to corporate level, division level and individual level performance.

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Consistent with a strong pay-for-performance philosophy, the STI Plan is structured to generally provide increases in short termshort-term incentive compensation (expressed as a percentage of base salary) if the Executives exceed established targets and decreases in short termshort-term incentive compensation if the Executives fail to meet established targets. The target annual incentive award opportunities of each Executive in fiscal 2015 are listed below.

Target Annual Incentive Award Opportunity

(as a % of base salary)

In setting the fiscal 20142015 targets, the Committee considered information in the Company’s business plans and preliminary recommendations from Mr. Robichaud.

In general, for the Executives, the secondary goals are weighted 80% towards the achievement of targeted Company consolidated earnings before interest and taxes (“Adjusted EBIT”) and 20% towards the achievement of personal goals. However, given the low-level of anticipated Adjusted EBIT forprior fiscal 2014,years, the Committee recommended to the Board that the Executives would not be eligible for the normal 80% of the short term incentive awardhad set a primary goal based on the achievement of an Adjusted EBIT targeta threshold return on net assets, which if it was not met, no awards would be paid, even if the other financial and individual performance goals were met. For fiscal 2015, the Committee decided not to set a primary goal based on a threshold return on net assets. The goals for fiscal 2015 for the corporate Executives were a combination of 4% RONA was achieved.Company EBITDA (net income from continuing operations, plus interest, income taxes, depreciation, amortization, other non-cash items and only including equity earnings to the extent of dividends received) and personal goals. For the Division Presidents, the fiscal 2015 goals were a combination of Division EBITDA, Company EBITDA and personal goals. For each of the Executives, the secondary personal goals were based on recommendations by Mr. Robichaud. The personal goals recommendedproposed by Mr. Robichaud were related to the achievement of various goals set forth in the business plan for each Executive’s respective corporate function or division.

In general, ifThe table below lists the primary and secondaryEBITDA goals (both financial and personal) are achieved, Mr. Robichaud’s target award underfor fiscal 2015 (in thousands):

The table below lists for fiscal 2015, the STI Plan would be 100% of his base salary and the target award under the STI Plan for eachrelative weighting of the other Executives would be 60%performance goals for the Executives:

Weighting of his base salary.Performance Goals

If Mr. Robichaud achieved more than 100% of his secondary financial target goal, then for each 1% increase above the secondary financial target, Mr. Robichaud’s base salary percentage would be increased by 5% but his base salary percentage cannot be increased by more than 100%. If Mr. Robichaud achieved less than 100% of his secondary financial target goal, then for each 1% decrease below the target, the 100% base salary percentage would be decreased by 2.5%. Notwithstanding the above, if Mr. Robichaud achieved 80% or less of the secondary financial target, his base salary percentage would be zero. As discussed earlier, the amount of the total award related to the achievement of the secondary financial goals would make up 80% of the total award.

All of the other Executives will receive an incentive award of 60% of their individual base salaries, if they each achieve 100% of their respective secondary financial target goals. If the other Executives achieve more than 100% of their respective secondary financial target goals, then for each 1% increase above the secondary financial target goals, the Executive’s base salary percentage would be increased by 5%, but such base salary percentage cannot be increased by more than 100%. If the other Executives achieve less than 100% of their respective secondary financial target goals, then for each 1% decrease below the secondary financial target, the 60% base salary percentage would be decreased by 2.5%; provided, however that if an Executive achieved 80% or less of the secondary financial target, the base salary percentage would be zero. As discussed above, the amount of the total award related to the achievement of the secondary financial goals would make up 80% of the total award.

The percentage of the Executive’s target award that is paid based on personal performance is determined by comparing each Executive’s actual results to his individual goals, but cannot exceed 20% of the Executive’s target award.19

Awards for Fiscal 2014.2015. In March 2014,2015, the Committee discussed fiscal 20142015 awards under the STI Plan. The Company did not exceedachieve its EBITDA threshold during fiscal 2015. With the primary RONA goal for an awardexception of the portion of Messrs. Purlee’s and Thalacker’s financial goals tied to the performance of the Inliner and Water Resources divisions, respectively, none of the financial thresholds were achieved during fiscal 2015. The Inliner and Water Resources divisions achieved 107% and 120% of their EBITDA targets, respectively. Although some of the Executives achieved some of their individual performance goals, with the exception of Mr. Purlee and Mr. Thalacker, the Committee exercised its discretion to not award the 20% of the targeted STI Plan bonus based on individual performance due to the poor financial results of the Company for fiscal 2015. Mr. Purlee and Mr. Thalacker each achieved 80% of their individual performance goals. As a result, the Committee recommended, and the Board approved, the payment of an STI Plan bonus to Mr. Purlee and Mr. Thalacker based on their respective division’s financial performance and individual performance. Each participating Executive earned bonuses under the 2015 STI Plan and as a result no awards were awarded to any of the Executives.

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Equity Compensation

The Committee believes that aligning the interests of stockholders and its Executives is achieved through ownership of stock-based awards, such as stock options and restricted stock, which expose the Executives to the risks of declining stock prices and provides an incentive for Executives to maximize stockholder value.

2006 Equity Incentive Plan.Plan. Awards under the Company’s 2006 Equity Incentive Plan are designed to encourage Executives to acquire a proprietary and vested interest in the growth and performance of the Company, as well as to assist the Company in attracting and retaining Executives by providing them with the opportunity to participate in the success and profitability of the Company. The 2006 Equity Incentive Plan permits the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and performance units.

Fiscal 20142015 Grants under 2006 Equity Incentive Plan.PlanShortly before the beginning of fiscal 2014, F.W. Cook recommended to. The Board and the Committee that the Company adopthave adopted the LTI Plan for the purpose of making equity grants on an annual basis to certain key employees. Under the LTI Plan, the Board willis required to establish an annual equity pool (the “LTI Pool”) within the first 90 days of each fiscal year. The equity awards issued from the LTI Pool relate to the Company’s Common Stock and will be made pursuant to the Company’s 2006 Equity Incentive Plan, or any successor or other Company stockholder-approved equity plan. The size of the LTI Pool in any year will generally be limited to 1%2% of the average market capitalization of the Company during the 30-day period ending on January 31st31^st of the award year. Within the limits of the LTI Pool, the Board will make awards to participants based on recommendations made by the Compensation Committee.

A participant’s award from the LTI Pool (i.e., the participant’s “LTI Target Opportunity”) will beis expressed as a percentage of the participant’s current base salary, which percentage will vary depending on the participant’s position in the Company. The percentages range from 200% of base salary for the Company’s Chief Executive Officer to 30% of base salary for the Company’s corporate vice-presidents. A percentage of each participant’s LTI Target Opportunity, as determined by the Committee, will be granted in the form of time-vested stock options, time-vested restricted stock units (“RSUs”) and performance shares. In general, the percentages for the time-vested options, time-vested RSUs and performance shares are generally expected to be 40%, 10% and 50%, respectively, of each participant’s LTI Target Opportunity. However, theThe Committee has sole discretion to increase or decrease these percentages recognizing that circumstances surrounding annual LTI grants will change from year to year. DueFor fiscal 2015, the percentages for the time-vested options, time-vested RSUs and performance shares were set at 30%, 20% and 50%, respectively, of each participant’s LTI Target Opportunity.

Awards were made to Executives that were employed by the Company on May 1, 2014 with the exception of the awards made to Mr. Robichaud, which were made on June 6, 2014 to ensure sufficient shares were available under the Company’s 2006 Equity Incentive Plan to permit issuance of awards to the difficult economic environment and performance of the Company, for fiscal 2014, the Committee recommended and the Board approved a reductionother participants in the total valueCompany’s 2006 Equity Incentive Plan in the event the shareholders did not approve an increase in the number of the Executives’ awardsshares available under the LTI Plan by 25%.2006 Equity Incentive Plan.

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Stock Options.The Committee recommended, and the Board approved, grants of nonqualified stock options under the 2006 Equity Incentive Plan to the following Executives for the purchase of that number of shares of Company Common Stock determined by dividing the Stock Option Amount set forth in the table below by the value of such option determined by the Company’s option pricing model as of AprilMay 1, 2013, or May2014 (or June 6, 20132014 for Mr. EasterRobichaud) (the date of grant).

The Committee recommended, and the Board approved, an exercise price for all such options in an amount equal to the Fair Market Value (as defined in the 2006 Equity Incentive Plan) of the Company’s Common Stock as of the date of grant, with vesting to occur over a period of three years from the date of grant.

The nonqualified stock options granted under the 2006 Equity Incentive Plan expire ten years from the date of grant. See “Executive Compensation and Other Arrangements—Information—Potential Payments Upon Change of Control, Retirement, Death or Disability” below for descriptions of the amounts Executives may receive upon a change in control, retirement, death or disability.

Time-Vesting Restricted Stock Units.The Committee also recommended, and the Board approved, grants of time-vesting RSUs determined by dividing the RSU Amount set forth oppositein the respective Executive’s nametable below by the closing price of our Common Stock as of AprilMay 1, 2013, or May2014 (or June 6, 20132014 for Mr. EasterRobichaud) (the date of grant).

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EachWith the exception of the retention grant made to Mr. Purlee, each RSU grant will vest and be payable on the fifththird anniversary of each such award’s grant date, or, if earlier, upon the participant’s retirement from the Company, which can occur only if the participant is age 60 and has been employed with the Company for at least five years. The participant is required to hold and not sell any shares issued in connection with the settlement of a vested RSU until his separation from the Company. See “Executive Compensation and Other Arrangements—Information—Potential Payments Upon Change of Control, Retirement, Death or Disability” below for descriptions of the amounts Executives may receive upon a change in control, retirement, death or disability.

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Performance Shares.The Committee also recommended, and the Board approved, grants of performance shares of Company Common Stock determined by dividing the Performance Share Amount set forth oppositein the respective Executive’s nametable below by the value of such shares determined by the Company’s performance share valuation method as of AprilMay 1, 20132014 (or June 6, 2014 for Mr. Robichaud) (the date of grant).

Mr. Easter did not receive a grant of performance shares for fiscal 2014.

If the trailing average closing price of the Company’s Common Stock during any 3020 consecutive trading daytrading-day period is at or above any of the following stock price goals during the period commencing on AprilMay 1, 20132014 and ending on March 31, 2016,May 1, 2017, then the performance shares will vest as follows: 33% will vest if at or above $25$22.00 per share; 67% will vest if at or above $27$24.00 per share and 100% will vest if at or above $30$26.00 per share. See “Executive Compensation and Other Arrangements—Information—Potential Payments Upon Change of Control, Retirement, Death or Disability” below for descriptions of the amounts Executives may receive upon a change in control, retirement, death or disability.

Benefits

Our Executives who meet minimum service requirements are entitled to receive medical, dental, life and short-term and long-term disability insurance benefits and may participate in a capital accumulation plan, as described below. Such benefits are provided equally to all Company employees, other than where benefits are provided pro-rata based on the respective Executive’s salary (such as the level of disability insurance coverage).

Capital Accumulation Plan

The Company has adopted a capital accumulation plan (the “Capital Accumulation Plan”). Each of the Company’s executive officers, including the Executives, and substantially all other employees of the Company are eligible to participate in the Capital Accumulation Plan. The Capital Accumulation Plan is a defined contribution plan qualified under Section 401, including Section 401(k), of the Internal Revenue Code of 1986, as amended (the “Code”). The Capital Accumulation Plan provides for two methods of Company contributions, a Company matching contribution tied to and contingent upon participant deferrals and a Company profit sharing contribution which is not contingent upon participant deferrals. The amount, if any, of Company paid contributions, both matching and profit sharing, for each fiscal year under the Capital Accumulation Plan is determined by the Board of Directors in its discretion. Each eligible employee meeting certain service requirements and electing to defer a portion of his or her compensation under the Capital Accumulation Plan participates in the Company’s matching contribution

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program pursuant to a formula as designated by the Board of Directors. Currently, the Company makes a matching contribution that is equal to 100% of a participant’s salary deferrals that do not exceed 3% of the participant’s compensation plus 50% of a participant’s salary deferrals between 3% and 5% of the participant’s compensation. This form of matching contribution qualifies as what is known as a “safe harbor” matching contribution under the Employee Retirement Income Security Act of 1974. In addition, each eligible employee meeting certain service requirements participates in Company profit sharing contributions to the Capital Accumulation Plan in the proportion his or her eligible compensation bears to the aggregate compensation of the group participating in the Capital Accumulation Plan. At the option of the Board of Directors, all or any portion of Company contributions to this plan may be made in the Company’s Common Stock. Furthermore, each participant can voluntarily contribute, on a pre-tax basis, a portion of his or her compensation (which cannot exceed $17,500 for participants who are 49 or younger, or $23,000 for participants who are 50 or older, for the calendar year 2013)2014) under the Capital

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Accumulation Plan. A participant’s account will be placed in a trust and invested at the participant’s direction in any one or more of a number of available investment options. Each participant may receive the funds in his or her Capital Accumulation Plan account upon termination of employment. For services rendered in fiscal 2014,2015, total Company contributions under the Capital Accumulation Plan of $7,744, $9,027, $10,773, $10,742$11,000, $7,082, $1,385, $10,574, $10,400, $4,015, $10,400 and $10,683$10,446 accrued for the accounts of Messrs. Brown, Robichaud, Fanska,Atchison, Crooke, Purlee, Thalacker, Penzhorn, and Singleton, respectively. Messrs. Caliel and Easter did not participate in the Capital Accumulation Plan during fiscal 2015.

Deferred Compensation

The Company’s Key Management Deferred Compensation Plan was designed to provide additional retirement benefits and income tax deferral opportunities for a select group of management and highly compensated employees. The plan allows such key executives, including the Executives, to defer the receipt of up to 50% of base salary and 100% of performance-based awards. The Company may match contributions to this plan in an amount determined annually by the Committee, generally based on recommendations from Company management. Currently, the Company is not making a matching contribution under the plan. In addition, the Company may make contributions on a discretionary basis. Company contributions to the plan are subject to a five-year vesting schedule, with 50% of all such contributions becoming vested after three years of completed plan participation and 100% of all such contributions becoming vested after five years of completed plan participation or upon a participant turning 60 years of age. However, Company contributions become fully vested if a participant is involuntarily terminated by the Company within one year after a change of control of the Company. If a plan participant is not employed by the Company as of the last day of the plan year other than by reason of his or her retirement, death or disability, the Company contributions, if any, for such plan year shall be zero. In the event of an Executive’s retirement, disability or death, he or she shall be credited with the Company contribution, if any, for such plan year.

The deferred compensation plan is a nonqualified and unfunded plan, and participants have only an unsecured promise from the Company to pay the amounts when they become due from the general assets of the Company. The Committee offers this benefit to provide Executives with an opportunity to save, on a tax deferredtax-deferred basis, amounts in addition to what they can save under the Company’s qualified retirement plans for retirement or future dates. The Committee believes this plan is important as a retention and recruitment tool because most of the companies with which the Company competes for executive talent provide a deferral plan for their executives.

Perquisites

The Company believes its executive compensation program described above is generally sufficient for attracting talented executives and that providing other significant perquisites is generally neither necessary nor in the stockholders’ best interests. However, in connection with the hiring of Mr. Robichaud, the Company agreed to reimburse Mr. Robichaud for temporary housing for up to one year and for weekly commuting expenses between Kansas City and Cincinnati during such period for either him or his spouse, which in connection with the relocation of the Company’s headquarters to the Houston metropolitan area was extended through July 2013.

In connection with the Company’s relocation to The Woodlands, Texas, the Company provided all of its employees that relocated to The Woodlands with customary relocation assistance, which varied based on the employee’s position with the Company. The Company was also able to negotiate a free corporate membership to a country club in The Woodlands with individual memberships being issued to Messrs. Robichaud, Crooke and Singleton. The Company pays the monthly dues for each of the Executives.

In connection with the hiring of Mr. Easter, the Company agreed to issue to Mr. Easter stock options under the Company’s 2006 Equity Incentive Plan relating to the purchase of shares of Common Stock if Mr. Easter relocated his personal residence to The Woodlands, Texas area on or before May 5, 2014. The number of shares of Common Stock subject to the options is equal to $50,000 divided by the per share Fair Market Value of each option as determined pursuant to the Company’s option pricing model as of December 6, 2013 (the date of such relocation), which was also the date of grant for such options. The options have the same terms as the LTI Plan options described above.

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Except for thesethe following items, none of the Executives received any perquisites that have a value in the aggregate in excess of $10,000 during fiscal 2015.

In connection with the fiscal year ended January 31, 2014.hiring of Messrs. Brown and Atchison as interim Chief Executive Officer and Chief Financial Officer, respectively, the Company agreed to reimburse them for a reasonable housing allowance in The Woodlands, Texas and for travel expenses as appropriate and necessary.

AdjustmentsMr. Thalacker was reimbursed for certain expenses related to his relocation to The Woodlands, Texas.

Mr. Singleton was reimbursed for certain expenses related to his relocation to The Woodlands, Texas and for monthly country club dues through June 30, 2015 (at which time the Company discontinued the reimbursement).

Clawback Policy

The Board has adopted a policy that gives the Board, or if designated by the Board, the Committee, the ability to recoup cash and equity-based incentive compensation due to misconduct resulting in the Company’s material noncompliance with any financial reporting requirement under the securities laws. For purposes of the clawback policy, incentive compensation does not include compensation, in any form, for which vesting, payment, delivery, or exercisability is not based on goal or performance achievement. The Board, or the Committee, has discretion to seek recovery of any amount that it determines was received inappropriately by these individuals.

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Stock Ownership Guidelines

On April 10, 2015, the Board adopted stock ownership guidelines for certain executive officers that require the Company’s chief executive officer to own shares of the Company’s common stock with a market value equal to three times his base salary and the chief financial officer and general counsel to own shares of common stock with a market value equal to one time their base salary. The executive officers are required to achieve the applicable ownership level within five years of the later of the effective date of the policy or the date an individual becomes subject to the stock ownership guidelines. If an individual becomes subject to a greater ownership amount for any reason (e.g., due to promotion or increase in base salary), the individual is expected to meet the higher ownership amount within the later of the original period of becoming subject to the stock ownership guidelines or five years from the effective date of the increased requirement.

Hedging Policies

We do not have a policy with respect to hedging the economic risks of stock ownership. However, our policy statement regarding Securities Trading and Handling of Nonpublic Information prohibits our executive officers and directors from engaging in certain types of hedging activity, such as short sales or buying or selling put or call options of any of our securities.

Advisory Vote on Executive Compensation Plan

The Company has no formal policyconducts an advisory vote on recapturing salaryexecutive compensation each year at its annual meeting. While the votes are not binding on the Company, its Board, or incentive awards (equity or cash) grantedthe Committee, the Committee believes that an annual advisory vote on executive compensation offers stockholders the opportunity to an Executive,express their views regarding the Company’s compensation program and the Committee’s decisions on executive compensation. The Board and the Committee value the opinions of stockholders and each year the Committee closely examines stockholders’ concerns and evaluates whether any actions are necessary to address those concerns.

At last year’s annual meeting, over 70% of the votes cast “for” and “against” the advisory vote on executive compensation were voted “for” the Company’s named executive officer compensation as disclosed in the eventproxy statement. The percentage of votes cast “for” the Company’s named executive officer compensation represented a significant increase from the prior two years. The Board believes the increase reflects the Committee’s increased focus on ensuring that the Company were to have to restate its financial statements (whether arising from conduct or actions oftotal short and long term incentive compensation for the Executive, or otherwise). However, the discretion retained by the Committee to make adjustments in all types of compensation, permits it to decrease an Executive’s compensation under such circumstances if such compensation has not already been paid or become final. The Company intends to adopt a compensation claw-back policy after the Securities and Exchange Commission adopts final rules related to compensation claw backs pursuantCompany’s executive officers is linked to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Dodd-Frank Act. To date, the Company has never been required to restate its financial statements.Company’s performance as discussed elsewhere in this Proxy Statement.

Tax and Accounting Treatment of Compensation

Deductibility of Compensation

The Committee has taken, and it intends to continue to take, reasonable steps necessary to assure the Company’s ability to deduct for federal tax purposes compensation provided to senior executives. However, such steps may not always be practical or consistent with the Committee’s compensation objectives. Given that the earnings limit for deductibility has remained fixed since 1993, and the value of some compensation elements cannot be determined until year-end, there are circumstances in which some executive compensation may not meet tax deductibility requirements. The Company can deduct all of the compensation shown in the Summary Compensation Table for fiscal 2014,2015, excluding the value of equity-based awards which are subject to taxation in a later period.

Nonqualified Deferred Compensation

Certain of the Company’s nonqualified compensation and benefits arrangements, incentive programs and corporate practices (such as severance, relocation and expense reimbursements) are considered nonqualified deferred compensation and subject to IRC Section 409A and the related regulations. In general, Code Section 409A restricts the timing and manner of payment (as well as the timing of participant elections) under these types of taxable compensation programs. The Company has amended theseCompany’s arrangements, programs and practices to cause them to beare in compliance with thethese statutory and regulatory provisions. The changes have no financial impact on the Company, nor do they have any material impact on the way in which it compensates the Executives.

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Accounting for Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with the requirements of ASC Topic 718, which requires the Company to expense the estimated value of certain stock-based compensation.

Stock Ownership Guidelines and Hedging Policies

We do not have formal stock ownership guidelines for executive officers or a policy with respect to hedging the economic risks of stock ownership. But our policy statement regarding Securities Trading and Handling of Nonpublic Information prohibits our executive officers and directors from engaging in certain types of hedging activity, such as short sales or buying or selling put or call options of any of our securities. Additionally, we require executives to continue to own non-performance-based restricted stock until they are no longer employed by the Company as a means of ensuring equity retention and long-term linkage to stockholders.

Advisory Vote on Executive Compensation

The Company conducts an advisory vote on executive compensation each year at its annual meeting. While the votes are not binding on the Company, its Board, or the Committee, the Committee believes that an annual advisory vote on executive compensation offers stockholders the opportunity to express their views regarding the Company’s compensation program and the Committee’s decisions on executive compensation. The Board and the Committee value the opinions of stockholders and each year the Committee closely examines stockholders’ concerns and evaluates whether any actions are necessary to address those concerns.

At last year’s annual meeting, a majority of the votes cast on the advisory vote on executive compensation were voted against the Company’s Named Executive Officer compensation as disclosed in the proxy statement despite the Company having received a positive vote recommendation by the proxy advisory firm Institutional Shareholder Services (ISS). Following the annual meeting, the Company contacted several of its largest institutional stockholders to discuss any concerns they might have had regarding the Company’s Executive compensation. None of the stockholders contacted indicated any specific concerns regarding the Company’s Executive compensation.

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At the annual meeting in 2012, only 57% of the votes cast for and against the advisory vote on executive compensation were voted in favor of the Company’s Named Executive Officer compensation. After that vote, the Committee focused on improving the link between pay and performance and with the assistance of F.W. Cook re-evaluated the Company’s Executive compensation program. As a result of that review, in early fiscal 2014, the Committee recommended, and the Board approved, the adoption of the STI Plan and the LTI Plan, which replaced our prior plans. However, stockholders at last year’s annual meeting did not have any data as to how the revised compensation program would actually be implemented by the Committee and the Board, which may have contributed to last year’s negative votes. The Committee believes that the total compensation amounts listed in the Summary Compensation Table for fiscal 2014 reflect the Committee’s commitment to create a stronger link between pay and performance than in prior years.

In addition, the Committee believes that the negative votes last year may have been due in part to the compensation disclosure requirements of the SEC that focus on grant date fair market value for equity-based awards without any disclosure in subsequent years of the amount that was actually realized by the Executives. As discussed above, the Committee has historically set very difficult vesting criteria for performance-based equity awards and as a result, the Executives have not realized any significant value from those past performance-based equity awards. See “—Executive Summary” above.

REPORTOFTHE COMPENSATION COMMITTEE

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis included in this Proxy Statement beginning at page 10.[•].

Based on the review and discussion with management, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement for the Company’s 20142015 Annual Meeting of Stockholders and be incorporated by reference into the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2014.2015.

Respectfully submitted by the members of the Compensation Committee of the Board of Directors:

John T. Nesser III, Chairman

David A.B. BrownRobert R. Gilmore

J. Samuel Butler

Nelson Obus

COMPENSATION COMMITTEE INTERLOCKSAND INSIDER PARTICIPATION

The members of the Compensation Committee are set forth in the preceding section. During the most recent fiscal year, no Layne Christensen executive officer served as a (i) member of the compensation committee (or equivalent), or the board of directors, of another entity, one of whose executive officers served on the Company’s Compensation Committee or (ii) member of the compensation committee (or equivalent) of another entity, one of whose executive officers served as a director of the Company.

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EXECUTIVE COMPENSATIONAND OTHER INFORMATION

Executive Compensation

The following table sets forth for the fiscal years ended January 31, 2015, 2014 2013 and 2012,2013, respectively, the compensation of the Company’s chiefnamed executive officer, chief financial officer, former chief financial officer and of each of the Company’s three other most highly compensated executive officers whose remuneration for the fiscal year ended January 31, 2014, exceeded $100,000 for services to the Company and its subsidiaries in all capacities (collectively, the “Named Executive Officers”):officers:

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Summary Compensation Table

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The incentive compensation paid to Messrs. Robichaud, Fanska and Crooke with respect to fiscal 2012 is also reported in the “Bonus” column rather than the “Non-Equity Incentive Plan Compensation” column since the Company did not meet the target performance goals set for those Executive Officers under the Executive Incentive Compensation Plan due to the non-cash write-off of goodwill and other intangible assets, the additional compensation cost associated with the transition of the Chief Executive Officer position and the FCPA accrual. As a result, the incentive awards for those Named Executive Officers for fiscal 2012 were discretionary bonuses.

2127

Grants of Plan-Based Awards during Fiscal 20142015

The following table sets forth information with respect to each Named Executive Officernamed executive officer concerning grants during the fiscal year ended January 31, 2014,2015, of awards under both the Company’s equity and non-equity plans.

28

22