• SEC Filings

On March 19, 2018, Layne Christensen Company (the "Company") entered into a Note Purchase Agreement with two funds advised by Corre Partners Management, LLC. Under the Note Purchase Agreement, the purchasers have committed to purchase $71.0 million of the Company's 11% Senior Unsecured Notes due October 16, 2019 (the "Notes") at a purchase price equal to 50% of the principal amount of the Notes. The closing of the purchase and sale of the Notes will be the earlier to occur of (i) October 1, 2018 and (ii) the fifth business day after delivery of a funding notice by the Company to the purchasers. The use of proceeds from the issuance of the Notes is limited to repaying the unpaid principal amount of the Company's 8.00% convertible notes or 4.25% convertible notes, in each case together with accrued and unpaid interest thereon, on their respective maturity date or Effectively Discharging (as defined in the indenture for the 8.00% convertible notes) the 4.25% convertible notes. The commitment of the purchasers to purchase the Notes terminates upon the earliest to occur of: (i) a change of control of the Company (including the previously announced pending merger with Granite Construction Incorporated) and (ii) delivery to the purchasers of a notice of termination by the Company.

The Company at its option may prepay the Notes in whole or in part at any time. The Notes are subject to a mandatory prepayment upon the closing of a change of control. The Notes are subject to an Early Payment Event Fee if the Notes are repaid less than 90 days after the Notes are issued. The amount of the Early Payment Event Fee will be equal to the excess, if any, of (x) 90 days of accrued interest on the principal amount repaid, over (y) the amount of interest accrued and paid or payable with respect to the principal amount repaid from the date of issuance to and including the date of the repayment.

There are no covenants applicable to the Company under the Note Purchase Agreement so long as: (i) the Notes have not been issued, (ii) any of the 8.00% convertible notes are outstanding and (iii) none of the provisions of the indenture governing the 8.00% convertible notes have been amended or waived. After the Notes have been issued, the Company will be subject to certain covenants, including, delivery of financial statements and other reports, compliance with material contracts and applicable laws, and maintenance of corporate existence, insurance and properties. In addition, after the earliest date that (i) none of the 8.00% convertible notes are outstanding or (ii) all or any of the provisions of the indenture governing the 8.00% convertible notes are no longer in effect or have been amended or waived, the Company will be subject to negative covenants related to indebtedness, liens, sale and leaseback transactions, asset sales, dividends and restricted payments, transactions with affiliates, and maximum ratio of funded indebtedness to EBITDA.

Based on information provided by Corre Partners Management to the Company, as of March 19, 2018, Corre Partners Management and its affiliated funds and persons (including the purchasers of the Notes) own approximately $16 million of the 4.25% convertible notes and $1.9 million of the 8.00% convertible notes.

Item 2.03Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

See the disclosures under Item 1.01 of this Current Report on Form 8-K, which are incorporated herein by reference.

About LAYNE CHRISTENSEN COMPANY (NASDAQ:LAYN)

Layne Christensen Company (Layne) is a water management, construction and drilling company. The Company provides drilling solutions for water management, mineral services and specialty drilling needs. The Company operates through four segments: Water Resources, Inliner, Heavy Civil and Mineral Services. Its Water Resources segment provides its customers with solutions for various aspects of water supply system development and technology throughout the United States. Its Inliner segment is a service rehabilitation company offering a range of solutions for wastewater, storm water and process sewer pipeline networks. Its Heavy Civil segment delivers solutions to government agencies and industrial clients by overseeing the design and construction of water and wastewater treatment plants and pipeline installation. Its Mineral Services conducts ground drilling activities, including core drilling, reverse circulation, dual tube, hammer and rotary air-blast methods.