Horizon Lines, Inc. announced it has reached an agreement in principle providing for the settlement and dismissal, with prejudice, of the consolidated putative class action complaint pending in the Delaware Court of Chancery in connection with Horizon's proposed merger with Matson Navigation, Inc., a subsidiary of Matson, Inc.
Pursuant to the settlement with plaintiffs, which is subject to Court approval, Horizon agreed to make certain supplemental disclosures to Horizon's stockholders through a supplement to Horizon's proxy statement. Further, Horizon agreed to amend the Agreement and Plan of Merger, dated as of November 11, 2014, by and among Horizon, Matson, and Hogan Acquisition Inc., a wholly-owned subsidiary of Matson to reduce the termination fee that may be payable by Horizon to Matson under certain circumstances from $17,149,600 to $9,500,000.
The settlement will not affect the merger consideration to be paid to Horizon's stockholders in connection with the Merger or the timing of the special meeting of Horizon's stockholders scheduled for February 25, 2015 to consider and to vote upon a proposal to adopt the Merger Agreement, among other things.
Horizon and its board of directors believe that the claims in the actions are entirely without merit but are entering into this settlement because it will eliminate the risks, costs, and other burdens of litigation. In the event the Court does not approve the settlement, Horizon and its board of directors intend to contest the claims vigorously.