10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-Q

(Mark one)

x Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 23, 2014

OR

¨ Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from                      to                     

Commission File Number 001-32627

HORIZON LINES, INC.

(Exact name of registrant as specified in its charter)

Delaware	74-3123672
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4064 Colony Road, Suite 200, Charlotte, North Carolina	28211
(Address of principal executive offices)	(Zip Code)

(704) 973-7000

(Registrant’s telephone number, including area code)

NOT APPLICABLE

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such a shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

At April 30, 2014, 38,927,784 shares of the Registrant’s common stock, par value $.01 per share, were outstanding.

HORIZON LINES, INC.

Form 10-Q Index

	Page No.
Part I. Financial Information		1
1. Financial Statements		1
Unaudited Condensed Consolidated Balance Sheets		1
Unaudited Condensed Consolidated Statements of Operations		2
Unaudited Condensed Consolidated Statements of Comprehensive Loss		3
Unaudited Condensed Consolidated Statements of Cash Flows		4
Notes to Condensed Consolidated Financial Statements (Unaudited)		5
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		17
3. Quantitative and Qualitative Disclosures About Market Risk		30
4. Controls and Procedures		31
Part II. Other Information		32
1. Legal Proceedings		32
1A. Risk Factors		32
2. Unregistered Sales of Equity Securities and Use of Proceeds		32
3. Defaults Upon Senior Securities		32
4. Mine Safety Disclosures		32
5. Other Information		32
6. Exhibits		32
Signature		35
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2
Exhibit 101.INS XBRL Instance Document
Exhibit 101.SCH XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document

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PART I. FINANCIAL INFORMATION

1. Financial Statements

Horizon Lines, Inc.

Unaudited Condensed Consolidated Balance Sheets

(in thousands, except per share data)

	March 23,			December 22,
	2014			2013
Assets
Current assets
Cash	$	1,479		$	5,236
Accounts receivable, net of allowance of $4,834 and $3,984 at March 23, 2014 and December 22, 2013, respectively		114,376			100,460
Materials and supplies		26,193			23,369
Deferred tax asset		1,140			1,140
Other current assets		8,537			8,915
Total current assets		151,725			139,120
Property and equipment, net		223,390			226,838
Goodwill		198,793			198,793
Intangible assets, net		32,132			35,154
Other long-term assets		26,086			24,702
Total assets	$	632,126		$	624,607
Liabilities and Stockholders’ Deficiency
Current liabilities
Accounts payable	$	48,050		$	49,897
Current portion of long-term debt, including capital leases		13,753			11,473
Other accrued liabilities		93,686			77,406
Total current liabilities		155,489			138,776
Long-term debt, including capital leases, net of current portion		523,871			504,845
Deferred tax liability		1,571			1,391
Other long-term liabilities		20,461			23,387
Total liabilities		701,392			668,399
Stockholders’ deficiency
Preferred stock, $.01 par value, 30,500 shares authorized, no shares issued or outstanding		—			—
Common stock, $.01 par value, 150,000 shares authorized, 38,928 and 38,885 shares issued and outstanding as of March 23, 2014 and December 22, 2013, respectively		999			999
Additional paid in capital		384,768			384,073
Accumulated deficit		(456,129	)		(429,891	)
Accumulated other comprehensive income		1,096			1,027
Total stockholders’ deficiency		(69,266	)		(43,792	)
Total liabilities and stockholders’ deficiency	$	632,126		$	624,607

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Horizon Lines, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

	Quarters Ended
	March 23,			March 24,
	2014			2013
Operating revenue	$	251,935		$	244,491
Operating expense:
Cost of services (excluding depreciation expense)		226,554			212,608
Depreciation and amortization		8,452			9,571
Amortization of vessel dry-docking		4,949			3,032
Selling, general and administrative		20,165			19,736
Restructuring charge		5			4,844
Miscellaneous expense (income) net		378			(1,005	)
Total operating expense		260,503			248,786
Operating loss		(8,568	)		(4,295	)
Other expense:
Interest expense, net		17,494			15,700
Gain on change in value of debt conversion features		(71	)		(45	)
Other expense, net		1			3
Loss from continuing operations before income tax expense		(25,992	)		(19,953	)
Income tax expense		283			120
Net loss from continuing operations		(26,275	)		(20,073	)
Net income (loss) from discontinued operations		37			(278	)
Net loss	$	(26,238	)	$	(20,351	)
Basic and diluted net loss per share:
Continuing operations	$	(0.66	)	$	(0.58	)
Discontinued operations		—			(0.01	)
Basic and diluted net loss per share	$	(0.66	)	$	(0.59	)
Number of weighted average shares used in calculations:
Basic		39,917			34,746
Diluted		39,917			34,746

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Horizon Lines, Inc.

Unaudited Condensed Consolidated Statements of Comprehensive Loss

(in thousands)

	Quarters Ended
	March 23, 2014			March 24, 2013
Net loss	$	(26,238	)	$	(20,351	)
Other comprehensive income:
Amortization of pension and post-retirement benefit transition obligation, net of tax		69			159
Other comprehensive income		69			159
Comprehensive loss	$	(26,169	)	$	(20,192	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Horizon Lines, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)

	Quarters Ended
	March 23, 2014			March 24, 2013
Cash flows from operating activities:
Net loss from continuing operations	$	(26,275	)	$	(20,073	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		6,276			6,112
Amortization of other intangible assets		2,176			3,459
Amortization of vessel dry-docking		4,949			3,032
Amortization of deferred financing costs		846			752
Restructuring charge		5			4,844
Gain on change in value of debt conversion features		(71	)		(45	)
Deferred income taxes		135			116
Gain on equipment disposals		(217	)		(1,038	)
Stock-based compensation		733			1,601
Payment-in-kind interest expense		6,972			6,232
Accretion of interest on debt		290			171
Other non-cash interest accretion		284			265
Changes in operating assets and liabilities:
Accounts receivable		(13,885	)		(6,540	)
Materials and supplies		(2,823	)		3,640
Other current assets		378			(707	)
Accounts payable		(1,843	)		(5,919	)
Accrued liabilities		16,206			13,680
Vessel rent		—			(777	)
Vessel dry-docking payments		(5,060	)		(4,438	)
Legal settlement payments		(4,000	)		(6,500	)
Other assets/liabilities		(218	)		(683	)
Net cash used in operating activities from continuing operations		(15,142	)		(2,816	)
Net cash used in operating activities from discontinued operations		(102	)		(752	)
Cash flows from investing activities:
Purchases of property and equipment		(1,938	)		(93,105	)
Proceeds from the sale of property and equipment		839			2,329
Net cash used in investing activities		(1,099	)		(90,776	)
Cash flows from financing activities:
Issuance of debt		—			95,000
Payments on ABL facility		(12,200	)		(11,500	)
Borrowing under ABL facility		25,700			—
Payment of financing costs		(11	)		(5,289	)
Payments on capital lease obligations		(903	)		(536	)
Net cash provided by financing activities		12,586			77,675
Net decrease in cash from continuing operations		(3,655	)		(15,917	)
Net decrease in cash from discontinued operations		(102	)		(752	)
Net decrease in cash		(3,757	)		(16,669	)
Cash at beginning of period		5,236			27,839
Cash at end of period	$	1,479		$	11,170

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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HORIZON LINES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Organization

Horizon Lines, Inc. (the “Company”) operates as a holding company for Horizon Lines, LLC (“Horizon Lines”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Lines of Alaska, LLC (“Horizon Lines of Alaska”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Logistics, LLC (“Horizon Logistics”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Lines of Puerto Rico, Inc. (“HLPR”), a Delaware corporation and wholly-owned subsidiary, Hawaii Stevedores, Inc. (“HSI”), a Hawaii corporation and wholly-owned subsidiary, as well as Road Raiders Transportation, Inc. and Road Raiders Logistics, Inc. (collectively, “Road Raiders”), Delaware corporations and wholly-owned subsidiaries.

Horizon Lines operates as a Jones Act container shipping business with primary service to ports within the continental United States, Alaska, Hawaii, and Puerto Rico. Under the Jones Act, all vessels transporting cargo between covered locations must, subject to limited exceptions, be built in the U.S., registered under the U.S. flag, manned by predominantly U.S. crews, and owned and operated by U.S.-organized companies that are controlled and 75% owned by U.S. citizens. Horizon Lines also offers terminal services. HLPR operates as an agent for Horizon Lines in Puerto Rico and also provides terminal services in Puerto Rico. The Company also provides certain third-party logistics services via its Road Raiders subsidiaries.

2. Basis of Presentation

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany items have been eliminated in consolidation.

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X, and accordingly, certain financial information has been condensed and certain footnote disclosures have been omitted. Such information and disclosures are normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). These financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 22, 2013. The Company uses a 52 or 53 week (every sixth or seventh year) fiscal year that ends on the Sunday before the last Friday in December.

The financial statements as of March 23, 2014 and the financial statements for the quarters ended March 23, 2014 and March 24, 2013 are unaudited; however, in the opinion of management, such statements include all adjustments necessary for the fair presentation of the financial information included herein, which are of a normal recurring nature. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions and to use judgment that affects the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. Results of operations for interim periods are not necessarily indicative of results for the full year.

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3. Long-Term Debt

As of the dates below, long-term debt consisted of the following (in thousands):

	March 23,			December 22,
	2014			2013
First lien notes	$	222,213		$	222,381
Second lien notes		194,269			187,129
$75.0 million term loan agreement		73,504			73,282
$20.0 million term loan agreement		19,598			19,572
ABL facility		13,500			—
Capital lease obligations		13,040			12,415
6.0% convertible notes		1,500			1,539
Total long-term debt		537,624			516,318
Less current portion		(13,753	)		(11,473	)
Long-term debt, net of current portion	$	523,871		$	504,845

On October 5, 2011, the Company issued the 6.00% Convertible Notes. On October 5, 2011, Horizon Lines issued the First Lien Notes, the Second Lien Notes, and entered into the ABL Facility, and on January 31, 2013, entered into the $20.0 Million Agreement. On January 31, 2013, Horizon Lines Alaska Vessels, LLC (“Horizon Alaska”), the Company’s newly formed special purpose subsidiary, entered into the $75.0 Million Agreement. The 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, the ABL Facility, the $20.0 Million Agreement (collectively, the “Horizon Lines Debt Agreements”), and the $75.0 Million Agreement are defined and described below.

Per the terms of the Horizon Lines Debt Agreements, the Alaska SPEs (as defined below) are not required to be a party thereto, are considered “Unrestricted Subsidiaries” under the 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement, and do not guarantee any of the Horizon Lines Debt Agreements.

The 6.00% Convertible Notes are fully and unconditionally guaranteed by the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above. The ABL Facility, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement are fully and unconditionally guaranteed by the Company and each of its subsidiaries other than Horizon Lines and the Unrestricted Subsidiaries.

The ABL Facility is secured on a first-priority basis by liens on the accounts receivable, deposit accounts, securities accounts, investment property (other than equity interests of the subsidiaries and joint ventures of the Company) and cash, in each case with certain exceptions, of the Company and the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above (collectively, the “ABL Priority Collateral”). Substantially all other assets of the Company and the Company’s subsidiaries, other than the assets of the Unrestricted Subsidiaries identified above, also serve as collateral for the Horizon Lines Debt Agreements (collectively, such other assets are the “Secured Notes Priority Collateral”).

The following table summarizes the guarantors and non-guarantors of each of the Horizon Lines Debt Agreements:

	ABL Facility	$20 Million Agreement	First Lien Notes	Second Lien Notes	6% Convertible Notes	$75 Million Agreement
Horizon Lines, Inc.	Guarantor	Guarantor	Guarantor	Guarantor	Issuer	Non-Guarantor
Horizon Lines, LLC	Issuer	Issuer	Issuer	Issuer	Guarantor	Non-Guarantor
Horizon Alaska	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Issuer
Horizon Vessels	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Alaska Terminals	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Road Raiders Inland, Inc. and subsidiaries	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor
Other subsidiaries of the Company not specifically listed above	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor

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The following table lists the order of lien priority for each of the Horizon Lines Debt Agreements on the Secured Notes Priority Collateral and the ABL Priority Collateral, as applicable:

	Secured Notes Priority Collateral	ABL Priority Collateral
$20 Million Agreement	First	Second
First Lien Notes	Second	Third
Second Lien Notes	Third	Fourth
6.0% Convertible Notes	Fourth	Fifth
ABL Facility	Fifth	First

First Lien Notes

The 11.00% First Lien Senior Secured Notes (the “First Lien Notes”) were issued pursuant to an indenture on October 5, 2011. The First Lien Notes bear interest at a rate of 11.0% per annum, payable semiannually, and mature on October 15, 2016. The First Lien Notes are callable at par plus accrued and unpaid interest. Horizon Lines is obligated to make mandatory prepayments of 1%, on an annual basis, of the original principal amount. These prepayments are payable on a semiannual basis and commenced on April 15, 2012.

The First Lien Notes contain affirmative and negative covenants which are typical for senior secured high-yield notes with no financial maintenance covenants. The First Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the First Lien Notes was $228.4 million, which reflected Horizon Lines’ ability to call the First Lien Notes at 101.5% during the first year and at par thereafter. The original issue premium of $3.4 million is being amortized through interest expense through the maturity of the First Lien Notes.

Second Lien Notes

The 13.00%-15.00% Second Lien Senior Secured Notes (the “Second Lien Notes”) were issued pursuant to an indenture on October 5, 2011.

The Second Lien Notes bear interest at a rate of either: (i) 13% per annum, payable semiannually in cash in arrears; (ii) 14% per annum, 50% of which is payable semiannually in cash in arrears and 50% is payable in kind; or (iii) 15% per annum payable in kind, payable semiannually beginning on April 15, 2012, and maturing on October 15, 2016. The Second Lien Notes were non-callable for two years from the date of their issuance, and thereafter the Second Lien Notes are callable by Horizon Lines at (i) 106% of their aggregate principal amount, plus accrued and unpaid interest thereon in the third year, (ii) 103% of their aggregate principal amount, plus accrued and unpaid interest thereon in the fourth year, and (iii) at par plus accrued and unpaid interest thereafter.

On April 15, 2012, October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $7.9 million, $8.1 million, $8.7 million and $9.4 million, respectively, of Second Lien Notes to satisfy the payment-in-kind interest obligation under the Second Lien Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the Second Lien Notes due April 15, 2014 by issuing $10.1 million additional Second Lien Notes. As such, as of March 23, 2014, Horizon Lines has recorded $8.8 million of accrued interest as an increase to long-term debt.

The Second Lien Notes contain affirmative and negative covenants that are typical for senior secured high-yield notes with no financial maintenance covenants. The Second Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the Second Lien Notes was $96.6 million. The original issue discount of $3.4 million is being amortized through interest expense through the maturity of the Second Lien Notes.

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During 2012, the Company and Horizon Lines entered into a Global Termination Agreement with Ship Finance International Limited (“SFL”) whereby Horizon Lines issued $40.0 million aggregate principal amount of its Second Lien Notes and warrants to purchase 9,250,000 shares of the Company’s common stock at a price of $0.01 per share to satisfy its obligations for certain vessel leases. The Second Lien Notes issued to SFL (the “SFL Notes”) have the same terms as the Second Lien Notes issued on October 5, 2011 (the “Initial Notes”), except that they are subordinated to the Initial Notes in the case of a bankruptcy, and holders of the SFL Notes, so long as then held by SFL, have the option to purchase the Initial Notes in the event of a bankruptcy. On April 9, 2012, the fair value of the SFL Notes outstanding on such date approximated face value. On October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $3.1 million, $3.2 million and $3.5 million, respectively, of SFL Notes to satisfy the payment-in-kind interest obligation under the SFL Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the SFL Notes due April 15, 2014 by issuing $3.7 million additional SFL Notes. As such, as of March 23, 2014, Horizon Lines has recorded $3.3 million of accrued interest as an increase to long-term debt.

ABL Facility

On October 5, 2011, Horizon Lines entered into a $100.0 million asset-based revolving credit facility (the “ABL Facility”) with Wells Fargo Capital Finance, LLC (“Wells Fargo”). Use of the ABL Facility is subject to compliance with a customary borrowing base limitation. The ABL Facility includes an up to $30.0 million letter of credit sub-facility and a swingline sub-facility up to $15.0 million, with Wells Fargo serving as administrative agent and collateral agent. Horizon Lines has the option to request increases in the maximum commitment under the ABL Facility by up to $25.0 million in the aggregate; however, such incremental facility increases have not been committed to in advance. The ABL Facility is available to be used by Horizon Lines for working capital and other general corporate purposes.

The ABL Facility was amended on January 31, 2013 in conjunction with the $75.0 Million Agreement and $20.0 Million Agreement. In addition to allowing for the incurrence of the additional long-term debt under those agreements, amendments to the ABL Facility included, among other changes, (i) permission to make certain investments in the Alaska SPEs, including the proceeds of the $20.0 Million Agreement and the arrangements related to the charters and the sublease of the terminal facility licenses for the Vessels (as defined below), (ii) excluding the Alaska SPEs from the guarantee and collateral requirements of the ABL Facility and from the restrictions of the negative covenants and certain other provisions, (iii) weekly borrowing base reporting in the event availability under the facility falls below a threshold of (a) $14.0 million or (b) 14.0% of the maximum commitment under the ABL Facility, (iv) the exclusion of certain historical charges and expenses relating to discontinued operations and severance from the calculation of bank-defined Adjusted EBITDA, (v) the exclusion of the historical charter hire expense deriving from the Vessels from the calculation of bank-defined Adjusted EBITDA, and (vi) the inclusion of pro forma interest expense on the $75.0 Million Agreement and the $20.0 Million Agreement in the calculation of fixed charges.

The ABL Facility matures October 5, 2016 (but 90 days earlier if the First Lien Notes and the Second Lien Notes are not repaid or refinanced as of such date). The interest rate on the ABL Facility is LIBOR or a base rate plus an applicable margin based on leverage and excess availability, as defined in the agreement, ranging from (i) 1.25% to 2.75%, in the case of base rate loans and (ii) 2.25% to 3.75%, in the case of LIBOR loans. A fee ranging from 0.375% to 0.50% per annum will accrue on unutilized commitments under the ABL Facility. As of March 23, 2014, borrowings outstanding under the ABL facility totaled $13.5 million and total borrowing availability was $47.1 million. Horizon Lines had $12.1 million of letters of credit outstanding as of March 23, 2014.

The ABL Facility requires compliance with a minimum fixed charge coverage ratio test if excess availability is less than the greater of (i) $12.5 million or (ii) 12.5% of the maximum commitment under the ABL Facility. In addition, the ABL Facility includes certain customary negative covenants that, subject to certain materiality thresholds, baskets and other agreed upon exceptions and qualifications, will limit, among other things, indebtedness, liens, asset sales and other dispositions, mergers, liquidations, dissolutions and other fundamental changes, investments and acquisitions, dividends, distributions on equity or redemptions and repurchases of capital stock, transactions with affiliates, repayments of certain debt, conduct of business and change of control. The ABL Facility also contains certain customary representations and warranties, affirmative covenants and events of default, as well as provisions requiring compliance with applicable citizenship requirements of the Jones Act. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

$75.0 Million Term Loan Agreement

Three of Horizon Lines’ Jones Act-qualified vessels: the Horizon Anchorage, Horizon Tacoma, and Horizon Kodiak (collectively, the “Vessels”) were previously chartered. The charter for the Vessels was due to expire in January 2015. On January 31, 2013, the Company, through its newly formed subsidiary Horizon Alaska, acquired off of charter the Vessels for a purchase price of approximately $91.8 million.

On January 31, 2013, Horizon Alaska, together with two newly formed subsidiaries of Horizon Lines, Horizon Lines Alaska Terminals, LLC (“Alaska Terminals”) and Horizon Lines Merchant Vessels, LLC (“Horizon Vessels”), entered into an approximately $75.8 million term loan agreement with certain lenders and U.S. Bank National Association (“U.S. Bank”), as the

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administrative agent, collateral agent and ship mortgage trustee (the “$75.0 Million Agreement”). The obligations under the $75.0 Million Agreement are secured by a first-priority lien on substantially all of the assets of Horizon Alaska, Horizon Vessels, and Alaska Terminals (collectively, the “Alaska SPEs”), which primarily includes the Vessels. The operations of the Alaska SPEs are limited to a bareboat charter of the Vessels between Horizon Alaska and Horizon Lines and a sublease of a terminal facility in Anchorage, Alaska between Alaska Terminals and Horizon Lines of Alaska.

The loan under the $75.0 Million Agreement accrues interest at 10.25% per annum, payable quarterly commencing March 31, 2013. Amortization of loan principal is payable in equal quarterly installments, commencing on March 31, 2014, and each amortization installment will equal 2.5% of the total initial loan amount (which may increase to 3.75% upon specified events). The full remaining outstanding amount of the loan under the $75.0 Million Agreement is payable on September 30, 2016. The proceeds of the loan under the $75.0 Million Agreement were utilized by Horizon Alaska to acquire the Vessels. In connection with the borrowing under the $75.0 Million Agreement, the Alaska SPEs paid financing costs of $2.5 million during 2013, which included loan commitment fees of $1.5 million. The financing costs have been recorded as a reduction to the carrying amount of the $75.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $75.0 Million Agreement. In addition to the commitment fees of $1.5 million paid in cash at closing, the Alaska SPEs will also pay, at maturity of the $75.0 Million Agreement, an additional $0.8 million of closing fees by increasing the original $75.0 million principal amount. The Company is recording non-cash interest accretion through maturity of the $75.0 Million Agreement related to the additional closing fees.

The $75.0 Million Agreement contains certain covenants, including a minimum EBITDA threshold and limitations on the incurrence of indebtedness, liens, asset sales, investments and dividends (all as defined in the agreement). The Alaska SPEs were in compliance with all such covenants as of March 23, 2014. The agent and the lenders under the $75.0 Million Agreement do not have any recourse to the stock or assets of the Company or any of its subsidiaries (other than the Alaska SPEs or equity interests therein). Defaults under the $75.0 Million Agreement do not give rise to any remedies under the Horizon Lines Debt Agreements.

On January 31, 2013, the fair value of the $75.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $75.0 Million Agreement, the Company utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $75.0 Million Agreement. The Company determined the estimated benchmark yield approximated the stated interest rate.

$20.0 Million Term Loan Agreement

On January 31, 2013, the Company and those of its subsidiaries that are parties (collectively, the “Loan Parties”) to the existing First Lien Notes, the Second Lien Notes, and the 6.00% Convertible Notes (collectively, the “Notes”) entered into a $20.0 million term loan agreement with certain lenders and U.S. Bank, as administrative agent, collateral agent, and ship mortgage trustee (the “$20.0 Million Agreement”). The loan under the $20.0 Million Agreement matures on September 30, 2016 and accrues interest at 8.00% per annum, payable quarterly. The $20.0 Million Agreement does not provide for any amortization of principal, and the full outstanding amount of the loan is payable on September 30, 2016. Horizon Lines is not permitted to optionally prepay the $20.0 Million Agreement except for prepayment in full (together with a prepayment premium equal to 5.0% of the principal amount prepaid) following repayment in full of the First Lien Notes and the $75.0 Million Agreement.

In connection with the issuance of the $20.0 Million Agreement, Horizon Lines paid financing costs of $0.6 million during 2013. The financing costs have been recorded as a reduction to the carrying amount of the $20.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $20.0 Million Agreement.

The covenants in the $20.0 Million Agreement are substantially similar to the negative covenants contained in the indentures governing the Notes, which indentures permit the incurrence of the term loan borrowed under the $20.0 Million Agreement and the contribution of such amounts to Horizon Alaska. The proceeds of the loan borrowed under the $20.0 Million Agreement were contributed to Horizon Alaska to enable it to acquire the Vessels.

On January 31, 2013, the fair value of the $20.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $20.0 Million Agreement, the Company utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $20.0 Million Agreement. The Company determined the estimated benchmark yield approximated the stated interest rate.

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6.00% Convertible Notes

On October 5, 2011, the Company issued $178.8 million in aggregate principal amount of new 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and $99.3 million in aggregate principal amount of new 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, collectively the “6.00% Convertible Notes”). The 6.00% Convertible Notes were issued pursuant to an indenture, which the Company and the Loan Parties entered into with U.S. Bank , as trustee and collateral agent, on October 5, 2011 (the “6.00% Convertible Notes Indenture”).

During 2012, the Company completed various debt-to-equity conversions of the 6.00% Convertible Notes. On October 5, 2012, all outstanding Series B Notes not previously converted into shares of the Company’s common stock were mandatorily converted into Series A Notes as required by the terms of the 6.00% Convertible Notes Indenture. As of March 23, 2014, $2.0 million face value of the Series A Notes remains outstanding. The Series A Notes bear interest at a rate of 6.00% per annum, payable semiannually. The Series A Notes mature on April 15, 2017 and are convertible at the option of the holders, and at the Company’s option under certain circumstances, into shares of the Company’s common stock or warrants, as the case may be. Upon conversion, foreign holders may, under certain conditions, receive warrants in lieu of shares of common stock.

The conversion rate of the remaining Series A Notes may be increased in certain circumstances to compensate the holders thereof for the loss of the time value of the conversion right (i) if at any time the Company’s common stock or the common stock into which the new notes may be converted is greater than or equal to $11.25 per share and is not listed on the NYSE or NASDAQ markets or (ii) if a change of control occurs, unless at least 90% of the consideration received or to be received by holders of common stock, excluding cash payments for fractional shares, in connection with the transaction or transactions constituting the change of control, consists of shares of common stock, American Depositary Receipts or American Depositary Shares traded on a national securities exchange in the United States or which will be so traded or quoted when issued or exchanged in connection with such change of control. Upon a change of control, holders will have the right to require the Company to repurchase for cash the outstanding Series A Notes at 101% of the aggregate principal amount, plus accrued and unpaid interest.

The long-term debt and embedded conversion options associated with the 6.00% Convertible Notes were recorded on the Company’s balance sheet at their fair value on October 5, 2011. On October 5, 2011, the fair value of the long-term debt portion of the Series A Notes and Series B Notes was $105.6 million and $58.6 million, respectively. The original issue discounts associated with the 6.00% Convertible Notes still outstanding are being amortized through interest expense through the maturity of the Series A Notes.

Warrants

Certain warrants, not including the warrants issued to SFL, were issued pursuant to a warrant agreement, which the Company entered into with The Bank of New York Mellon Trust Company, N.A, as warrant agent, on October 5, 2011, as amended by Amendment No. 1, dated December 7, 2011 (the “Warrant Agreement”). Pursuant to the Warrant Agreement, each warrant entitles the holder to purchase common stock at a price of $0.01 per share, subject to adjustment in certain circumstances. In connection with a reverse stock split in December 2011, warrant holders will receive 1/25th of a share of the Company’s common stock upon conversion. As of March 23, 2014 there were 1.1 billion warrants outstanding for the purchase of up to 52.9 million shares of the Company’s common stock. Upon issuance, in lieu of payment of the exercise price, a warrant holder will have the right (but not the obligation) to require the Company to convert its warrants, in whole or in part, into shares of its common stock without any required payment or request that the Company withhold, from the shares of common stock that would otherwise be delivered to such warrant holder, shares issuable upon exercise of the Warrants equal in value to the aggregate exercise price.

Warrant holders will not be permitted to exercise or convert their warrants if and to the extent the shares of common stock issuable upon exercise or conversion would constitute “excess shares” (as defined in the Company’s certificate of incorporation) if they were issued in order to abide by the foreign ownership limitations imposed by the Company’s certificate of incorporation. In addition, a warrant holder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the holder, the person that the holder has designated to receive the common stock upon exercise or conversion) is a United States citizen will not be permitted to exercise or convert its warrants to the extent the receipt of the common stock upon exercise or conversion would cause such person or any person whose ownership position would be aggregated with that of such person to exceed 4.9% of the Company’s outstanding common stock.

The warrants contain no provisions allowing the Company to force redemption, and there is no conditional obligation of the Company to redeem or convert the warrants. Each warrant is convertible into shares of the Company’s common stock at an exercise price of $0.01 per share, which the Company has the option to waive. In addition, the Company has sufficient authorized and unissued shares available to settle the warrants during the maximum period the warrants could remain outstanding. As a result, the warrants do not meet the definition of an asset or liability and were classified as equity on the date of issuance, on December 22, 2013, and on March 23, 2014. The warrants will be evaluated on a continuous basis to determine if equity classification continues to be appropriate.

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Fair Value of Financial Instruments

The estimated fair value of the Company’s debt as of March 23, 2014 and December 22, 2013 totaled $501.2 million and $488.9 million, respectively. The fair value of the First Lien Notes and the Second Lien Notes is based upon quoted market prices. The fair value of the other long-term debt approximates carrying value.

4. Income Taxes

The Company continues to believe it will not generate sufficient taxable income to realize its deferred tax assets. Accordingly, the Company maintains a valuation allowance against its deferred tax assets. The valuation allowance is reviewed quarterly and will be maintained until sufficient positive evidence exists to support the reversal of the valuation allowance. In addition, until such time the Company determines it is more likely than not that it will generate sufficient taxable income to realize its deferred tax assets, income tax enefits associated with future-period losses will be fully reserved, except for intraperiod allocations of income tax expense.

As a result of the loss from continuing operations and income from discontinued operations and other comprehensive income during 2014, the Company is required to record a tax benefit from continuing operations with an offsetting tax expense from discontinued operations and other comprehensive income. For the quarter ended March 23, 2014 the Company has recorded a tax benefit in continuing operations due to intraperiod allocations of income tax expense, resulting in lower net tax expense in continuing operations. As such, the Company’s tax benefit recorded in continuing operations will approximate the income from discontinued operations and other comprehensive income multiplied by the statutory tax rate during 2014.

5. Stock-Based Compensation

Stock-based compensation costs are measured at the grant date, based on the estimated fair value of the award, and are recognized as an expense in the income statement over the requisite service period. Compensation costs related to stock options, restricted shares and restricted stock units (“RSUs”) granted under the Amended and Restated Equity Incentive Plan (the “Plan”), the 2009 Incentive Compensation Plan (the “2009 Plan”), and the 2012 Incentive Compensation Plan (“the 2012 Plan”) are recognized using the straight-line method, net of estimated forfeitures. Stock options and restricted shares granted to employees under the Plan and the 2009 Plan typically cliff vest and become fully exercisable on the third anniversary of the grant date, provided the employee who was granted such options/restricted shares is continuously employed by the Company or its subsidiaries through such date, and provided any performance based criteria, if any, are met. RSUs granted under the 2012 Plan typically contain a graded vesting schedule with a portion vesting each year over a three-year period.

The following compensation costs are included within selling, general, and administrative expenses on the condensed consolidated statements of operations (in thousands):

	Quarters Ended
	March 23, 2014		March 24, 2013
Restricted stock units	$	711	$	1,540
Restricted stock		22		61
Total	$	733	$	1,601

Restricted Stock Units

The following table details grants of RSUs during 2012 and 2013:

					RSUs Vested
		Total			as of		Potential Future Vesting Dates
Grant Date	Recipient	RSUs Outstanding		Vesting Criteria	March 23, 2014		March 31, 2014		December 31, 2014		March 31, 2015		June 30, 2015
July 5, 2012	CEO		1,500,000	Time-Based		750,000		—		500,000		—		250,000
July 5, 2012	CEO		1,500,000	Performance-Based		—		—		1,500,000		—		—
July 25, 2012	Board of Directors		900,000	Time-Based		180,000		360,000		—		360,000		—
July 25, 2012	Management		1,109,584	Time-Based		221,917		443,833		—		443,834		—
July 25, 2012	Management		1,109,583	Performance-Based		—		—		—		1,109,583		—
December 26, 2012	Management		120,834	Time-Based		—		72,500		—		48,334		—
December 26, 2012	Management		120,833	Performance-Based		—		—		—		120,833		—
June 1, 2013	Management		87,500	Time-Based		—		52,500		—		35,000		—
June 1, 2013	Management		87,500	Performance-Based		—		—		—		87,500		—
						1,151,917		928,833		2,000,000		2,205,084		250,000

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The grant date fair value of the RSUs granted during 2012 and 2013 was determined using the closing price of the Company’s common stock on the grant date. The time-based RSUs will vest solely if the employee remains in continuous employment with the Company. A portion of the performance-based RSUs would have vested on March 31, 2013 and March 31, 2014, however, the Company did not meet the performance goals established for 2012 or 2013. Accordingly, the Company did not record any expense during 2012 or 2013 related to these performance-based RSUs. Per the terms of the agreement, if any of the performance-based RSUs do not vest on their assigned performance date solely because the performance goals are not met, then such RSUs shall remain outstanding and shall be eligible to vest on subsequent performance dates to the extent performance goals are established and met for such subsequent year. The performance-based RSUs will vest on December 31, 2014 and March 31, 2015 if certain performance goals for 2014 are met and the employee remains in continuous employment with the Company.

Each vested RSU shall be settled within 30 days following termination of the employment with the Company or termination of the director’s service as a member of the Board of Directors. All of the vested RSUs granted to the Company’s Chief Executive Officer and members of its Board of Directors shall be settled in shares of the Company’s common stock. Fifty percent of the vested RSUs granted to members of the Company’s management shall be settled in shares of the Company’s common stock and the remaining 50% of such vested RSUs shall be settled, in the discretion of the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”), either in shares of the Company’s common stock, cash or any combination thereof. The amount of any cash is to be determined based on the value of a share of the Company’s common stock on the settlement date.

A summary of the status of the Company’s RSU awards as of March 23, 2014 is presented below:

Restricted Stock Units	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		5,883,917		$	1.85
Granted		—
Vested		(500,000	)		1.95
Forfeited		—
Nonvested at March 23, 2014		5,383,917		$	1.84

As of March 23, 2014, there was $6.2 million of unrecognized compensation expense related to the RSUs. A total of $3.3 million is expected to be recognized over a weighted-average period of one year. The remaining $2.9 million is not expected to be recognized since the Company does not expect to meet the performance criteria established for 2014.

Restricted Stock

A summary of the status of the Company’s restricted stock awards as of March 23, 2014 is presented below:

Restricted Shares	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		3,343		$	89.75
Granted		—
Vested		(3,343	)	$	89.75
Forfeited		—
Nonvested at March 23, 2014		—

As of March 23, 2014, there was no unrecognized compensation costs related to all restricted stock awards.

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Stock Options

The Company’s stock option plan provides for grants of stock options to key employees at prices not less than the fair market value of the Company’s common stock on the grant date. The Company has not granted any stock options since 2008. As of both March 23, 2014 and December 22, 2013, there were outstanding and exercisable options to purchase 26,829 shares of the Company’s common stock at a weighted average exercise price of $402.25 per share. The weighted average remaining contractual term of the outstanding and exercisable options is 2.3 years. As of March 23, 2014, there was no unrecognized compensation costs related to stock options.

6. Net Loss per Common Share

Basic net loss per share is computed by dividing net loss by the weighted daily average number of shares of common stock outstanding during the period. Diluted net loss per share is based upon the weighted daily average number of shares of common stock outstanding for the period plus dilutive potential shares of common stock, including stock options and warrants to purchase common stock, using the treasury-stock method.

Net loss per share is as follows (in thousands, except per share amounts):

	Quarters Ended
	March 23,			March 24,
	2014			2013
Numerator:
Net loss from continuing operations	$	(26,275	)	$	(20,073	)
Net income (loss) from discontinued operations		37			(278	)
Net loss	$	(26,238	)	$	(20,351	)
Denominator:
Denominator for basic net loss per common share:
Weighted average shares outstanding		39,917			34,746
Effect of dilutive securities:
Stock-based compensation		—			—
Warrants to purchase common stock		—			—
Denominator for diluted net loss per common share		39,917			34,746
Basic and diluted net loss per common share:
From continuing operations	$	(0.66	)	$	(0.58	)
From discontinued operations		—			(0.01	)
Basic and diluted net loss per common share	$	(0.66	)	$	(0.59	)

Warrants outstanding to purchase 52.3 million and 56.4 million common shares have been excluded from the denominator for calculating diluted net loss per share during the quarters ended March 23, 2014 and March 24, 2013, respectively, as the impact would be anti-dilutive.

On August 27, 2012, the Company adopted a rights plan (the “Rights Plan”) intended to avoid an “ownership change” within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended, and thereby preserve the current ability of the Company to utilize certain net operating loss carryovers and other tax benefits of the Company. As part of the Rights Agreement, the Company authorized and declared a dividend distribution of one right (a “Right”) for each outstanding share of Common Stock to stockholders of record at the close of business on September 7, 2012. Each Right entitles the holder to purchase from the Company a unit consisting of one ten-thousandth of a share (a “Unit”) of Series A Participating Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”) at a purchase price of $8.00 per Unit, subject to adjustment (the “Purchase Price”). Until a Right is exercised, the holder thereof, as such, will have no separate rights as a stockholder of the Company, including the right to vote or to receive dividends in respect of Rights. The issuance of the Rights alone does not cause any change in the number of shares deliverable upon the exercise of the Company’s outstanding warrants or convertible notes, or the exercise price or conversion price (as applicable) thereof. In its 2014 proxy statement for the Annual Meeting of Stockholders to be held June 5, 2014, the Company included a proposal soliciting stockholder approval of the Rights Plan. If the Company does not receive the affirmative vote of the majority of shares present in person or represented by proxy at the June 5, 2014 Annual Meeting of Stockholders, then the Company intends to take action to repeal the Rights Plan.

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7. Property and Equipment

Property and equipment consists of the following (in thousands):

	March 23, 2014				December 22, 2013
	Historical		Net Book		Historical		Net Book
	Cost		Value		Cost		Value
Vessels and vessel improvements	$	228,377	$	126,634	$	227,705	$	129,384
Containers		39,652		24,218		39,894		24,710
Chassis		21,289		12,520		20,435		11,847
Cranes		27,829		12,140		27,409		12,088
Machinery and equipment		35,008		12,497		34,367		11,784
Facilities and land improvements		30,765		21,483		30,065		21,171
Software		24,448		1,135		24,177		1,041
Construction in progress		12,763		12,763		14,813		14,813
Total	$	420,131	$	223,390	$	418,865	$	226,838

8. Intangible Assets

Intangible assets consist of the following (in thousands):

	March 23,			December 22,
	2014			2013
Customer contracts/relationships	$	141,430		$	141,430
Trademarks		63,800			63,800
Deferred financing costs		15,691			15,691
Total intangibles with definite lives		220,921			220,921
Accumulated amortization		(188,789	)		(185,767	)
Net intangibles with definite lives		32,132			35,154
Goodwill		198,793			198,793
Intangible assets, net	$	230,925		$	233,947

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9. Accrued Liabilities

Other current accrued liabilities consist of the following (in thousands):

	March 23, 2014		December 22, 2013
Vessel operations	$	17,237	$	12,286
Payroll and employee benefits		16,704		16,101
Marine operations		8,918		5,382
Terminal operations		9,535		8,477
Fuel		8,889		5,193
Interest		12,922		6,817
Legal settlements		3,758		4,382
Restructuring		476		587
Other liabilities		15,247		18,181
Total other current accrued liabilities	$	93,686	$	77,406

The Company has recorded certain of its legal settlements at their net present value and is recording accretion of the liability balance through interest expense. In addition to the current accrued liabilities related to legal settlements, the Company also has commitments to make payments after March 23, 2015. The Company is required to make payments related to the plea agreement with the Antitrust Division of the Department of Justice of $4.0 million on or before March 24, 2015 and $4.0 million on or before March 21, 2016, both of which are included in other long-term liabilities.

10. Commitments and Contingencies

Legal Proceedings

In May 2013, the U.S. Department of Justice declined to intervene in a qui tam complaint filed in the U.S. District Court for the Central District of California by Mario Rizzo under the Federal False Claims Act. The case was unsealed in May 2013, and the Company was served with a complaint in June 2013. The case is entitled United States of America, ex rel. Mario Rizzo v. Horizon Lines, LLC et al. The qui tam complaint alleges, among other things, that the Company and another defendant submitted false claims by claiming fuel surcharges in excess of what was permitted by the Department of Defense. The complaint seeks significant damages, penalties and other relief. The Company has filed responsive pleadings and intends to vigorously defend against the allegations set forth in the complaint.

On March 5, 2014, the Company entered into a settlement agreement that resolved pending inquiries of the United States Department of Justice on behalf of the United States Postal Service, the United States Department of Agriculture and the United States Department of Defense (collectively, the “United States”). The settlement agreement relates to a federal qui tam complaint filed by the relator, William B. Stallings, in the United States District Court for the Middle District of Florida, entitled United States of America, ex rel. Stallings v. Sea Star Line, LLC et al., pursuant to the qui tam provisions of the False Claims Act. The claims underlying the qui tam civil complaint were the alleged price fixing of certain ocean transportation contracts between the continental United States and Puerto Rico during the period from April 2002 through April 2008 that involved the United States as a customer. This qui tam action was unsealed on March 6, 2014. The settlement agreement provides that the Company will pay to the United States the total sum of $1.5 million in six different installment payments through April 2015. During the fourth quarter of 2013, the Company recorded a charge of $1.4 million related to this legal settlement, which represents the present value of the expected future payments.

In the ordinary course of business, from time to time, the Company becomes involved in various legal proceedings. These relate primarily to claims for loss or damage to cargo, employees’ personal injury claims, and claims for loss or damage to the person or property of third parties. The Company generally maintains insurance, subject to customary deductibles or self-retention amounts, and/or reserves to cover these types of claims. The Company also, from time to time, becomes involved in routine employment-related disputes and disputes with parties with which it has contractual relations. The Company’s policy is to disclose contingent liabilities associated with both asserted and unasserted claims after all available facts and circumstances have been reviewed and the Company determines that a loss is reasonably possible. The Company’s policy is to record contingent liabilities associated with both asserted and unasserted claims when it is probable that the liability has been incurred and the amount of the loss is reasonably estimable.

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Standby Letters of Credit

The Company has standby letters of credit, primarily related to its property and casualty insurance programs, as well as customs bonds. On March 23, 2014 and December 22, 2013, these letters of credit totaled $12.1 million and $12.9 million, respectively.

11. Recent Accounting Pronouncements

Accounting pronouncements effective after March 23, 2014 are not expected to have a material effect on the Company’s consolidated financial position or results of operations.

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2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our consolidated financial condition and results of operations should be read in conjunction with the financial statements of the Company and notes thereto included elsewhere in this quarterly report. In this quarterly report, unless the context otherwise requires, references to “we,” “us,” and “our” mean the Company, together with its subsidiaries, on a consolidated basis.

Executive Overview

	Quarters Ended
	March 23, 2014			March 24, 2013
	($ in thousands)
Operating revenue	$	251,935		$	244,491
Operating expense		260,503			248,786
Operating loss	$	(8,568	)	$	(4,295	)
Operating ratio		103.4	%		101.8	%
Revenue containers (units)		55,223			51,321
Average unit revenue	$	4,197		$	4,363

We believe that in addition to GAAP based financial information, EBITDA and Adjusted EBITDA are meaningful disclosures for the following reasons: (i) EBITDA and Adjusted EBITDA are components of the measure used by our board of directors and management team to evaluate our operating performance, (ii) EBITDA and Adjusted EBITDA are components of the measure used by our management to facilitate internal comparisons to competitors’ results and the marine container shipping and logistics industry in general and (iii) the payment of discretionary bonuses to certain members of our management is contingent upon, among other things, the satisfaction by Horizon Lines of certain targets, which contain EBITDA and Adjusted EBITDA as components. We acknowledge that there are limitations when using EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA are not recognized terms under GAAP and do not purport to be an alternative to net income as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Additionally, EBITDA and Adjusted EBITDA are not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as tax payments and debt service requirements. Because all companies do not use identical calculations, this presentation of EBITDA and Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. The EBITDA amounts presented below contain certain charges that our management team excludes when evaluating our operating performance, for making day-to-day operating decisions and that have historically been excluded from EBITDA to arrive at Adjusted EBITDA when determining the payment of discretionary bonuses.

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A reconciliation of net loss to EBITDA and Adjusted EBITDA is included below (in thousands):

	Quarters Ended
	March 23, 2014			March 24, 2013
Net loss	$	(26,238	)	$	(20,351	)
Net income (loss) from discontinued operations		37			(278	)
Net loss from continuing operations		(26,275	)		(20,073	)
Interest expense, net		17,494			15,700
Income tax expense		283			120
Depreciation and amortization		13,401			12,603
EBITDA		4,903			8,350
Union/other severance charges		1,104			300
Antitrust and false claims legal expenses		768			212
Legal settlement		45			—
Restructuring charge		5			4,844
Gain on change in value of debt conversion features		(71	)		(45	)
Adjusted EBITDA	$	6,754		$	13,661

In addition to EBITDA and Adjusted EBITDA, we use various other non-GAAP measures such as adjusted net income (loss), and adjusted net income (loss) per share. As with EBITDA and Adjusted EBITDA, the measures below are not recognized terms under GAAP and do not purport to be an alternative to net income (loss) as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Similar to the amounts presented for EBITDA and Adjusted EBITDA, because all companies do not use identical calculations, the amounts below may not be comparable to other similarly titled measures of other companies.

The tables below present a reconciliation of net loss to adjusted net loss and net loss per share to adjusted net loss per share (in thousands, except per share amounts):

	Quarters Ended
	March 23, 2014			March 24, 2013
Net loss	$	(26,238	)	$	(20,351	)
Net income (loss) from discontinued operations		37			(278	)
Net loss from continuing operations		(26,275	)		(20,073	)
Adjustments:
Union/other severance charges		1,104			300
Antitrust and false claims legal expenses		768			212
Accretion of legal settlements		284			265
Legal settlement		45			—
Restructuring charge		5			4,844
Gain on change in value of debt conversion features		(71	)		(45	)
Tax impact of adjustments		—			6
Total adjustments		2,135			5,582
Adjusted net loss	$	(24,140	)	$	(14,491	)

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	Quarters Ended
	March 23, 2014			March 24, 2013
Net loss per share	$	(0.66	)	$	(0.59	)
Net loss per share from discontinued operations		—			(0.01	)
Net loss per share from continuing operations		(0.66	)		(0.58	)
Adjustments:
Union/other severance charges		0.03			0.01
Antitrust and false claims legal expenses		0.02			—
Accretion of legal settlements		0.01			0.01
Restructuring charge		—			0.14
Total adjustments		0.06			0.16
Adjusted net loss per share	$	(0.60	)	$	(0.42	)

General

We believe that we are one of the nation’s leading Jones Act container shipping and integrated logistics companies. In addition, we are the only ocean carrier serving all three noncontiguous domestic markets of Alaska, Hawaii, and Puerto Rico from the continental United States. Under the Jones Act, all vessels transporting cargo between U.S. ports must, subject to limited exceptions, be built in the U.S., registered under the U.S. flag, manned by predominantly U.S. crews, and owned and operated by U.S.-organized companies that are controlled and 75% owned by U.S. citizens.

We own 13 vessels, all of which are fully qualified Jones Act vessels, and own or lease approximately 22,700 cargo containers. We provide comprehensive shipping and integrated logistics services in our markets. We have long-term access to terminal facilities in each of our ports, operating our terminals in Alaska, Hawaii, and Puerto Rico, as well as contracting for terminal services in the six ports in the continental U.S.

History

Our long operating history dates back to 1956, when Sea-Land Service, Inc. pioneered the marine container shipping industry and established our business. In 1958, we introduced container shipping to the Puerto Rico market, and in 1964 we pioneered container shipping in Alaska with the first year-round scheduled vessel service. In 1987, we began providing container shipping services between the U.S. west coast and Hawaii and Guam through our acquisition from an existing carrier of all of its vessels and certain other assets that were already serving that market. Today, as the only Jones Act vessel operator with an integrated organization serving Alaska, Hawaii, and Puerto Rico, we are uniquely positioned to serve our customers that require shipping and logistics services in more than one of these markets.

Critical Accounting Policies

We prepare our financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of our financial statements requires us to make estimates and assumptions in the reported amounts of revenue and expense during the reporting period and in reporting the amounts of assets and liabilities, and disclosures of contingent assets and liabilities at the date of our financial statements. Since many of these estimates and assumptions are based upon future events which cannot be determined with certainty, the actual results could differ from these estimates.

We believe that the application of our critical accounting policies, and the estimates and assumptions inherent in those policies, are reasonable. These accounting policies and estimates are periodically reevaluated and adjustments are made when facts or circumstances dictate a change. Historically, we have found the application of accounting policies to be appropriate and actual results have not differed materially from those determined using necessary estimates.

There have been no material changes to the Company’s critical accounting policies during the quarter ended March 23, 2014. The critical accounting policies can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 22, 2013 as filed with the Securities and Exchange Commission (“SEC”).

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Seasonality

Our container volumes are subject to seasonal trends common in the transportation industry. Financial results in the first quarter are normally lower due to reduced loads during the winter months. Volumes typically build to a peak in the third quarter and early fourth quarter, which generally results in higher revenues, improved margins, and increased earnings and cash flows.

Results of Operations

Operating Revenue Overview

We derive our revenue primarily from providing comprehensive shipping and integrated logistics services to and from the continental U.S. and Alaska, Puerto Rico, and Hawaii. We charge our customers on a per load basis and price our services based primarily on the length of inland and ocean cargo transportation hauls, type of cargo, and other requirements such as shipment timing and type of container. In addition, we assess fuel surcharges on a basis consistent with industry practice and at times may incorporate these surcharges into our basic transportation rates. There is occasionally a timing disparity between volatility in our fuel costs and related adjustments to our fuel surcharges (or the incorporation of adjusted fuel surcharges into our base transportation rates) that may result in variances in our fuel recovery.

During 2013, over 90% of our revenue was generated from our shipping and integrated logistics services in markets where the marine trade is subject to the Jones Act. The balance of our revenue was derived from (i) vessel loading and unloading services that we provide for vessel operators at our terminals, (ii) agency services that we provide for third-party shippers lacking administrative presences in our markets, (iii) warehousing services for third parties, and (iv) other non-transportation services.

As used in this Form 10-Q, the term “revenue containers” refers to containers that are transported for a charge, as opposed to empty containers.

Cost of Services Overview

Our cost of services consist primarily of vessel operating costs, marine operating costs, inland transportation costs, land costs and rolling stock rent. Our vessel operating costs consist primarily of vessel fuel costs, crew payroll costs and benefits, vessel maintenance costs, space charter costs, vessel insurance costs and vessel rent. We view our vessel fuel costs as subject to potential fluctuation as a result of changes in unit prices in the fuel market. Our marine operating costs consist of stevedoring, port charges, wharfage and various other costs to secure vessels at the port and to load and unload containers to and from vessels. Our inland transportation costs consist primarily of the costs to move containers to and from the port via rail, truck or barge. Our land costs consist primarily of maintenance, yard and gate operations, warehousing operations and terminal overhead in the terminals in which we operate. Rolling stock rent consists primarily of rent for street tractors, yard equipment, chassis, gensets and various dry and refrigerated containers.

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Quarter Ended March 23, 2014 Compared with the Quarter Ended March 24, 2013

	Quarters Ended
	March 23, 2014			March 24, 2013			Change			% Change
	($ in thousands)
Operating revenue	$	251,935		$	244,491		$	7,444			3.0	%
Operating expense:
Vessel		77,962			76,237			1,725			2.3	%
Marine		54,688			49,384			5,304			10.7	%
Inland		46,839			41,891			4,948			11.8	%
Land		37,362			35,444			1,918			5.4	%
Rolling stock rent		9,703			9,652			51			0.5	%
Cost of services		226,554			212,608			13,946			6.6	%
Depreciation and amortization		8,452			9,571			(1,119	)		(11.7	)%
Amortization of vessel dry-docking		4,949			3,032			1,917			63.2	%
Selling, general and administrative		20,165			19,736			429			2.2	%
Restructuring charge		5			4,844			(4,839	)		(99.9	)%
Miscellaneous expense (income), net		378			(1,005	)		1,383			(137.6	)%
Total operating expense		260,503			248,786			11,717			4.7	%
Operating loss	$	(8,568	)	$	(4,295	)	$	(4,273	)		99.5	%
Operating ratio		103.4	%		101.8	%					1.6	%
Revenue containers (units)		55,223			51,321			3,902			7.6	%
Average unit revenue	$	4,197		$	4,363		$	(166	)		(3.8	)%

Operating Revenue. Our operating revenue increased $7.4 million, or 3.0%, during the quarter ended March 23, 2014 compared to the quarter ended March 24, 2013. This revenue increase can be attributed to the following factors (in thousands):

Revenue container volume increase	$	12,882
Revenue container rate decrease		(3,251	)
Bunker and intermodal fuel surcharges decrease		(2,390	)
Other non-transportation services revenue increase		203
Total operating revenue increase	$	7,444

The increase in revenue container volume was primarily due to improved volumes in our Puerto Rico and Hawaii markets, partially offset by a decline in volumes in our Alaska market. The volume increases in our Puerto Rico market were primarily due to the May 2013 addition of a bi-weekly Jacksonville, Florida sailing to our southbound service between Houston, Texas and San Juan, Puerto Rico, as well as market share gains in both our northbound and southbound service between Philadelphia, Pennsylvania and San Juan. These volume increases were partially offset by volume declines resulting from the startup of a new competitor in our Puerto Rico market. Volume increases in our Hawaii market were primarily due to modest growth in the Hawaii economy, including construction materials and tourism, as well as an increase in automobile shipments. The decline in our container rates was primarily due to increased competition in our markets. Bunker and intermodal fuel surcharges, which are included in our transportation revenue, accounted for approximately 20.7% of total revenue in the quarter ended March 23, 2014 and approximately 22.3% of total revenue in the quarter ended March 24, 2013. We adjust our bunker and intermodal fuel surcharges as a result of changes in the cost of bunker fuel for our vessels, in addition to diesel fuel fluctuations passed on to us by our truck, rail, and barge service providers. Fuel surcharges are evaluated regularly as the price of fuel fluctuates, and we may at times incorporate these surcharges into our base transportation rates that we charge.

Cost of Services. The $13.9 million increase in cost of services is primarily due to higher container volumes, the addition of a bi-weekly Jacksonville sailing to our southbound service between Houston and San Juan, and contractual rate increases.

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Vessel expense, which is not primarily driven by revenue container volume, increased $1.7 million for the quarter ended March 23, 2014 compared to the quarter ended March 24, 2013. This increase was a result of the following factors (in thousands):

Labor and other vessel operating expense increase	$	4,299
Vessel lease expense decrease		(1,526	)
Vessel space charter expense decrease		(568	)
Vessel fuel costs decrease		(480	)
Total vessel expense increase	$	1,725

The $4.3 million increase in labor and other vessel operating expense was primarily due to contractual rate increases, the addition of a bi-weekly Jacksonville sailing to our southbound service between Houston and San Juan, and higher duplicate fuel and vessel labor costs related to dry-docking transits. The $1.5 million decrease in vessel lease expense is due to the purchase of three vessels previously under charter. The $0.5 million decline in fuel costs was comprised of a $2.4 million reduction as a result of lower fuel prices, partially offset by a $1.9 million increase resulting from higher consumption as a result of more operating days in 2014 due to dry-docking transits.

Marine expense is comprised of the costs incurred to bring vessels into and out of port, and to load and unload containers. The types of costs included in marine expense are stevedoring and associated benefits, pilotage fees, tug fees, government fees, wharfage fees, dockage fees, and line handler fees. The $5.3 million increase in marine expense during the quarter ended March 23, 2014 was primarily due to higher container volumes, the addition of a bi-weekly Jacksonville sailing, and contractual labor increases.

Inland expense increased to $46.8 million for the quarter ended March 23, 2014 compared to $41.9 million during the quarter ended March 24, 2013. The $4.9 million rise in inland expense was primarily due to higher container volumes, as well as contractual rate increases.

Land expense is comprised of the costs included within the terminal for the handling, maintenance, and storage of containers, including yard operations, gate operations, maintenance, warehouse, and terminal overhead. The increase in land expense can be attributed to the following (in thousands):

	Quarters Ended
	March 23, 2014		March 24, 2013		% Change
	(in thousands)
Land expense:
Maintenance	$	13,325	$	12,879		3.5	%
Terminal overhead		13,573		13,339		1.8	%
Yard and gate		8,619		7,539		14.3	%
Warehouse		1,845		1,687		9.4	%
Total land expense	$	37,362	$	35,444		5.4	%

The increase in yard and gate expenses was primarily due to higher equipment storage and fees associated with the monitoring of refrigerated containers, both of which were the result of an increase in container volumes, as well as contractual rate increases. Non-vessel related maintenance expense increased primarily as a result of a higher level of repair activities during the first quarter of 2014. Terminal overhead expenses increased during the first quarter of 2014 primarily due to expense related to certain union employees that elected early retirement, partially offset by lower utilities expenses.

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Depreciation and Amortization. Depreciation and amortization was $8.5 million during the quarter ended March 23, 2014 compared to $9.6 million during the quarter ended March 24, 2013. The increase in depreciation-owned vessels is due to the acquisition of three vessels that were previously chartered. The decrease in amortization of intangible assets was due to certain customer relationship assets becoming fully amortized.

	Quarters Ended
	March 23, 2014		March 24, 2013		% Change
	(in thousands)
Depreciation and amortization:
Depreciation—owned vessels	$	3,426	$	3,184		7.6	%
Depreciation and amortization—other		2,851		2,928		(2.6	)%
Amortization of intangible assets		2,175		3,459		(37.1	)%
Total depreciation and amortization	$	8,452	$	9,571		(11.7	)%
Amortization of vessel dry-docking	$	4,949	$	3,032		63.2	%

Amortization of Vessel Dry-docking. Amortization of vessel dry-docking was $4.9 million during the quarter ended March 23, 2014 compared to $3.0 million for the quarter ended March 24, 2013. Amortization of vessel dry-docking fluctuates based on the timing of dry-dockings, the number of dry-dockings that occur during a given period, and the amount of expenditures incurred during the dry-dockings. Dry-dockings for each vessel generally occur every two and a half years, and historically we have dry-docked approximately four vessels per year.

Selling, General and Administrative. Selling, general and administrative costs increased slightly to $20.2 million for the quarter ended March 23, 2014 compared to $19.7 million for the quarter ended March 24, 2013, an increase of $0.4 million or 2.1%. This increase is primarily due to a $0.6 million rise in legal fees and $0.6 million related to incentive-based compensation, partially offset by $0.9 million of lower stock-based compensation expense.

Restructuring Charge. During April 2013, we moved our northeast terminal operations to Philadelphia, Pennsylvania from Elizabeth, New Jersey. In association with the relocation of the terminal operations, we recorded a restructuring charge of $4.1 million during the first quarter of 2013 resulting from the estimated liability for withdrawal from the Port of Elizabeth’s multiemployer pension plan. The remaining $0.7 million restructuring charge was associated with the return of excess equipment and additional severance charges related to the service adjustment in Puerto Rico.

Miscellaneous Expense (Income), Net. Miscellaneous expense (income), net increased $1.4 million during the quarter ended March 23, 2014 compared to the quarter ended March 24, 2013, primarily as a result of lower gains on the sale of assets and higher bad debt expense.

Interest Expense, Net. Interest expense, net increased to $17.5 million for the quarter ended March 23, 2014 compared to $15.7 million for the quarter ended March 24, 2013, an increase of $1.8 million or 11.5%. This increase was primarily due to interest expense related to the debt issued during the first quarter of 2013 to acquire our three Alaska vessels that were previously chartered. In addition, on April 15, 2013 and October 15, 2013 we issued additional Second Lien Notes to satisfy the payment-in-kind interest obligation under the Second Lien Notes.

Income Tax Expense. The effective tax rate for the quarters ended March 23, 2014 and March 24, 2013 was (1.1)% and (0.6)%, respectively. As a result of the loss from continuing operations and income from discontinued operations and other comprehensive income during the first quarter of 2014, we are required to record a tax benefit from continuing operations with an offsetting tax expense from discontinued operations and other comprehensive income. For the quarter ended March 23, 2014, we have recorded a tax benefit in continuing operations equal to the income from discontinued operations and other comprehensive income multiplied by the statutory tax rate.

We continue to believe it is unclear as to the timing of when we will generate sufficient taxable income to realize our deferred tax assets. Accordingly, we maintain a valuation allowance against our deferred tax assets. Although we have recorded a valuation allowance against our deferred tax assets, it does not affect our ability to utilize our deferred tax assets to offset future taxable income. Until such time that we determine it is more likely than not that we will generate sufficient taxable income to realize our deferred tax assets, income tax benefits associated with future-period losses will be fully reserved, except for intraperiod allocations of income tax expense. As a result, we do not expect to record a current or deferred federal tax benefit or expense and only minimal state tax provisions during those periods.

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Liquidity and Capital Resources

Our principal sources of funds have been (i) earnings before non-cash charges and (ii) borrowings under debt arrangements. Our principal uses of funds have been (i) capital expenditures on our container fleet, terminal operating equipment, purchase of vessels and improvements to our vessel fleet, and our information technology systems, (ii) vessel dry-docking expenditures, (iii) working capital consumption, and (iv) principal and interest payments on our existing indebtedness. Cash totaled $1.5 million at March 23, 2014. Borrowing outstanding under the ABL facility totaled $13.5 million and total borrowing availability was $47.1 million as of March 23, 2014, resulting in total liquidity of $48.6 million.

Operating Activities

Net cash used in operating activities was $15.1 million for the quarter ended March 23, 2014 compared to $2.8 million for the quarter ended March 24, 2013. The increase in cash used in operating activities is primarily due to the following (in thousands):

Decrease in earnings adjusted for non-cash charges	$	(10,146	)
Increase in accounts receivable		(7,345	)
Increase in materials and supplies		(6,463	)
Increase in dry-docking payments		(622	)
Increase in accounts payable		4,076
Decrease in legal settlement payments		2,500
Increase in other accrued liabilities		2,526
Other changes in working capital, net		3,148
Total increase in cash used in operating activities	$	(12,326	)

Investing Activities

Net cash used in investing activities was $1.1 million for the quarter ended March 23, 2014 compared to $90.8 million for the quarter ended March 24, 2013. The $89.7 million decrease in net cash consumed is primarily due to the 2013 acquisition of three Alaska vessels that were previously chartered, partially offset by a reduction in proceeds received from the sale of assets.

Financing Activities

Net cash provided by financing activities during the quarter ended March 23, 2014 was $12.6 million compared to $77.7 million for quarter ended March 24, 2013. The net cash provided by financing activities during the quarter ended March 23, 2014 included a net $13.5 million borrowed under the ABL Facility. The net cash provided by financing activities during the quarter ended March 24, 2013 included the issuance of $95.0 million of new debt in connection with the purchase of three Alaska vessels that were previously chartered, as well as a net $11.5 million repayment under the ABL Facility. In addition, during the quarter ended March 24, 2013, we paid $5.3 million in financing costs related to fees associated with the new debt issued.

Outlook

We expect 2014 revenue container loads to be above 2013 levels due to anticipated modest volume growth in all three markets we serve. This projected volume growth takes into consideration the estimated impacts of a new competitor that entered the Puerto Rico Gulf service in May 2013, as well as a second vessel being added by a competitor in our Hawaii service during the fourth quarter of 2014, partially offset by the full-year impact of adding a bi-weekly Jacksonville sailing to our southbound service between Houston, Texas and San Juan, Puerto Rico.

Overall, container rates are expected to be below 2013 levels due to very competitive market conditions and a slight change in cargo mix. The new vessel capacity added in Puerto Rico in 2013 and expected to be added in Hawaii in 2014 will continue to impact rates as well.

We will experience increases in expenses associated with our revenue container volumes, including our vessel payroll costs and benefits, stevedoring, port charges, wharfage, inland transportation costs, and rolling stock costs, among others. Although the number of vessels being dry-docked in 2014 is less than 2013, the costs associated with repositioning vessels and expenses related to spare vessels will slightly exceed 2013 levels.

We expect 2014 financial results to approximate 2013 results, with 2014 adjusted EBITDA projected between $85.0 million and $95.0 million, compared with $95.2 million in fiscal 2013.

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Based on our current level of operations, we believe cash flow from operations and borrowings available under the ABL Facility will be adequate to support our business plans. We expect total liquidity during 2014 to reach a low of approximately $35.0 million during the second quarter, then build over the balance of the year and end 2014 at approximately $70.0 million.

Capital Requirements and Commitments

Based upon our current level of operations, we believe cash flow from operations and available cash, together with borrowings available under the ABL Facility, will be adequate to meet our liquidity needs for the next twelve months.

During the next twelve months, we expect to spend approximately $27.0 million and $11.0 million on capital expenditures and dry-docking expenditures, respectively. Such capital expenditures will include vessel modifications, rolling stock, and terminal infrastructure and equipment. We also expect to spend approximately $4.0 million during the next twelve months for legal settlements.

In addition to the dry-docking, capital expenditures, and legal settlements, we expect to utilize cash flows to make principal and interest payments. Due to the seasonality within our business and the above mentioned payments and expenses, we will utilize borrowings under the ABL Facility during the next twelve months.

Long-Term Debt

On October 5, 2011, we issued the 6.00% Convertible Notes. On October 5, 2011, Horizon Lines issued the First Lien Notes, the Second Lien Notes, and entered into the ABL Facility, and on January 31, 2013, entered into the $20.0 Million Agreement. On January 31, 2013, Horizon Lines Alaska Vessels, LLC (“Horizon Alaska”), our newly formed special purpose subsidiary, entered into the $75.0 Million Agreement. The 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, the ABL Facility, the $20.0 Million Agreement (collectively, the “Horizon Lines Debt Agreements”), and the $75.0 Million Agreement are defined and described below.

Per the terms of the Horizon Lines Debt Agreements, the Alaska SPEs (as defined below) are not required to be a party thereto, are considered “Unrestricted Subsidiaries” under the 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement, and do not guarantee any of the Horizon Lines Debt Agreements.

The 6.00% Convertible Notes are fully and unconditionally guaranteed by the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above. The ABL Facility, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement are fully and unconditionally guaranteed by the Company and each of its subsidiaries other than Horizon Lines and the Unrestricted Subsidiaries.

The ABL Facility is secured on a first-priority basis by liens on the accounts receivable, deposit accounts, securities accounts, investment property (other than equity interests of the subsidiaries and joint ventures of the Company) and cash, in each case with certain exceptions, of the Company and the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above (collectively, the “ABL Priority Collateral”). Substantially all other assets of the Company and the Company’s subsidiaries, other than the assets of the Unrestricted Subsidiaries identified above, also serve as collateral for the Horizon Lines Debt Agreements (collectively, such other assets are the “Secured Notes Priority Collateral”).

The following table summarizes the guarantors and non-guarantors of each of the Horizon Lines Debt Agreements:

	ABL Facility	$20 Million Agreement	First Lien Notes	Second Lien Notes	6% Convertible Notes	$75 Million Agreement
Horizon Lines, Inc.	Guarantor	Guarantor	Guarantor	Guarantor	Issuer	Non-Guarantor
Horizon Lines, LLC	Issuer	Issuer	Issuer	Issuer	Guarantor	Non-Guarantor
Horizon Alaska	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Issuer
Horizon Vessels	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Alaska Terminals	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Road Raiders Inland, Inc. and subsidiaries	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor
Other subsidiaries of the Company not specifically listed above	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor

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The following table lists the order of lien priority for each of the Horizon Lines Debt Agreements on the Secured Notes Priority Collateral and the ABL Priority Collateral, as applicable:

	Secured Notes Priority Collateral	ABL Priority Collateral
$20 Million Agreement	First	Second
First Lien Notes	Second	Third
Second Lien Notes	Third	Fourth
6.0% Convertible Notes	Fourth	Fifth
ABL Facility	Fifth	First

First Lien Notes

The 11.00% First Lien Senior Secured Notes (the “First Lien Notes”) were issued pursuant to an indenture on October 5, 2011. The First Lien Notes bear interest at a rate of 11.0% per annum, payable semiannually, and mature on October 15, 2016. The First Lien Notes are callable at par plus accrued and unpaid interest. Horizon Lines is obligated to make mandatory prepayments of 1%, on an annual basis, of the original principal amount. These prepayments are payable on a semiannual basis and commenced on April 15, 2012.

The First Lien Notes contain affirmative and negative covenants which are typical for senior secured high-yield notes with no financial maintenance covenants. The First Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the First Lien Notes was $228.4 million, which reflected Horizon Lines’ ability to call the First Lien Notes at 101.5% during the first year and at par thereafter. The original issue premium of $3.4 million is being amortized through interest expense through the maturity of the First Lien Notes.

Second Lien Notes

The 13.00%-15.00% Second Lien Senior Secured Notes (the “Second Lien Notes”) were issued pursuant to an indenture on October 5, 2011.

The Second Lien Notes bear interest at a rate of either: (i) 13% per annum, payable semiannually in cash in arrears; (ii) 14% per annum, 50% of which is payable semiannually in cash in arrears and 50% is payable in kind; or (iii) 15% per annum payable in kind, payable semiannually beginning on April 15, 2012, and maturing on October 15, 2016. The Second Lien Notes were non-callable for two years from the date of their issuance, and thereafter the Second Lien Notes are callable by Horizon Lines at (i) 106% of their aggregate principal amount, plus accrued and unpaid interest thereon in the third year, (ii) 103% of their aggregate principal amount, plus accrued and unpaid interest thereon in the fourth year, and (iii) at par plus accrued and unpaid interest thereafter.

On April 15, 2012, October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $7.9 million, $8.1 million, $8.7 million and $9.4 million, respectively, of Second Lien Notes to satisfy the payment-in-kind interest obligation under the Second Lien Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the Second Lien Notes due April 15, 2014 by issuing $10.1 million additional Second Lien Notes. As such, as of March 23, 2014, Horizon Lines has recorded $8.8 million of accrued interest as an increase to long-term debt.

The Second Lien Notes contain affirmative and negative covenants that are typical for senior secured high-yield notes with no financial maintenance covenants. The Second Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the Second Lien Notes was $96.6 million. The original issue discount of $3.4 million is being amortized through interest expense through the maturity of the Second Lien Notes.

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During 2012, we entered into a Global Termination Agreement with Ship Finance International Limited (“SFL”) whereby Horizon Lines issued $40.0 million aggregate principal amount of its Second Lien Notes and warrants to purchase 9,250,000 shares of our common stock at a price of $0.01 per share to satisfy its obligations for certain vessel leases. The Second Lien Notes issued to SFL (the “SFL Notes”) have the same terms as the Second Lien Notes issued on October 5, 2011 (the “Initial Notes”), except that they are subordinated to the Initial Notes in the case of a bankruptcy, and holders of the SFL Notes, so long as then held by SFL, have the option to purchase the Initial Notes in the event of a bankruptcy. On April 9, 2012, the fair value of the SFL Notes outstanding on such date approximated face value. On October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $3.1 million, $3.2 million and $3.5 million, respectively, of SFL Notes to satisfy the payment-in-kind interest obligation under the SFL Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the SFL Notes due April 15, 2014 by issuing $3.7 million additional SFL Notes. As such, as of March 23, 2014, Horizon Lines has recorded $3.3 million of accrued interest as an increase to long-term debt.

ABL Facility

On October 5, 2011, Horizon Lines entered into a $100.0 million asset-based revolving credit facility (the “ABL Facility”) with Wells Fargo Capital Finance, LLC (“Wells Fargo”). Use of the ABL Facility is subject to compliance with a customary borrowing base limitation. The ABL Facility includes an up to $30.0 million letter of credit sub-facility and a swingline sub-facility up to $15.0 million, with Wells Fargo serving as administrative agent and collateral agent. Horizon Lines has the option to request increases in the maximum commitment under the ABL Facility by up to $25.0 million in the aggregate; however, such incremental facility increases have not been committed to in advance. The ABL Facility is available to be used by Horizon Lines for working capital and other general corporate purposes.

The ABL Facility was amended on January 31, 2013 in conjunction with the $75.0 Million Agreement and the $20.0 Million Agreement. In addition to allowing for the incurrence of the additional long-term debt under those agreements, amendments to the ABL Facility included, among other changes, (i) permission to make certain investments in the Alaska SPEs, including the proceeds of the $20.0 Million Agreement and the arrangements related to the charters and the sublease of the terminal facility licenses for the Vessels (as defined below), (ii) excluding the Alaska SPEs from the guarantee and collateral requirements of the ABL Facility and from the restrictions of the negative covenants and certain other provisions, (iii) weekly borrowing base reporting in the event availability under the facility falls below a threshold of (a) $14.0 million or (b) 14.0% of the maximum commitment under the ABL Facility, (iv) the exclusion of certain historical charges and expenses relating to discontinued operations and severance from the calculation of bank-defined Adjusted EBITDA, (v) the exclusion of the historical charter hire expense deriving from the Vessels from the calculation of bank-defined Adjusted EBITDA, and (vi) the inclusion of pro forma interest expense on the $75.0 Million Agreement and the $20.0 Million Agreement in the calculation of fixed charges.

The ABL Facility matures October 5, 2016 (but 90 days earlier if the First Lien Notes and the Second Lien Notes are not repaid or refinanced as of such date). The interest rate on the ABL Facility is LIBOR or a base rate plus an applicable margin based on leverage and excess availability, as defined in the agreement, ranging from (i) 1.25% to 2.75%, in the case of base rate loans and (ii) 2.25% to 3.75%, in the case of LIBOR loans. A fee ranging from 0.375% to 0.50% per annum will accrue on unutilized commitments under the ABL Facility. As of March 23, 2014, borrowings outstanding under the ABL facility totaled $13.5 million and total borrowing availability was $47.1 million. Horizon Lines had $12.1 million of letters of credit outstanding as of March 23, 2014.

The ABL Facility requires compliance with a minimum fixed charge coverage ratio test if excess availability is less than the greater of (i) $12.5 million or (ii) 12.5% of the maximum commitment under the ABL Facility. In addition, the ABL Facility includes certain customary negative covenants that, subject to certain materiality thresholds, baskets and other agreed upon exceptions and qualifications, will limit, among other things, indebtedness, liens, asset sales and other dispositions, mergers, liquidations, dissolutions and other fundamental changes, investments and acquisitions, dividends, distributions on equity or redemptions and repurchases of capital stock, transactions with affiliates, repayments of certain debt, conduct of business and change of control. The ABL Facility also contains certain customary representations and warranties, affirmative covenants and events of default, as well as provisions requiring compliance with applicable citizenship requirements of the Jones Act. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

$75.0 Million Term Loan Agreement

Three of Horizon Lines’ Jones Act-qualified vessels: the Horizon Anchorage, Horizon Tacoma, and Horizon Kodiak (collectively, the “Vessels”) were previously chartered. The charter for the Vessels was due to expire in January 2015. For each chartered Vessel, Horizon Lines generally had the following options in connection with the expiration of the charter: (i) purchase the vessel for its fixed price or fair market value, (ii) extend the charter for an agreed upon period of time at a fixed price or fair market value charter rate or, (iii) return the vessel to its owner. On January 31, 2013, we, through our newly formed subsidiary Horizon Alaska, acquired off of charter the Vessels for a purchase price of approximately $91.8 million.

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On January 31, 2013, Horizon Alaska, together with two newly formed subsidiaries of Horizon Lines, Horizon Lines Alaska Terminals, LLC (“Alaska Terminals”) and Horizon Lines Merchant Vessels, LLC (“Horizon Vessels”), entered into an approximately $75.8 million term loan agreement with certain lenders and U.S. Bank National Association (“U.S. Bank”), as the administrative agent, collateral agent and ship mortgage trustee (the “$75.0 Million Agreement”). The obligations under the $75.0 Million Agreement are secured by a first priority lien on substantially all of the assets of Horizon Alaska, Horizon Vessels and Alaska Terminals (collectively, the “Alaska SPEs”), which primarily includes the Vessels. The operations of the Alaska SPEs are limited to a bareboat charter of the Vessels between Horizon Alaska and Horizon Lines and a sublease of a terminal facility in Anchorage, Alaska between Alaska Terminals and Horizon Lines of Alaska, LLC.

The loan under the $75.0 Million Agreement accrues interest at 10.25% per annum, payable quarterly commencing March 31, 2013. Amortization of loan principal is payable in equal quarterly installments, commencing on March 31, 2014, and each amortization installment will equal 2.5% of the total initial loan amount (which may increase to 3.75% upon specified events). The full remaining outstanding amount of the loan under the $75.0 Million Agreement is payable on September 30, 2016. The proceeds of the loan under the $75.0 Million Agreement were utilized by Horizon Alaska to acquire the Vessels. In connection with the borrowing under the $75.0 Million Agreement, the Alaska SPEs paid financing costs of $2.5 million during 2013, which included loan commitment fees of $1.5 million. The financing costs have been recorded as a reduction to the carrying amount of the $75.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $75.0 Million Agreement. In addition to the commitment fees of $1.5 million paid in cash at closing, the Alaska SPEs will also pay, at maturity of the $75.0 Million Agreement, an additional $0.8 million of closing fees by increasing the original $75.0 million principal amount. We are recording non-cash interest accretion through maturity of the $75.0 Million Agreement related to the additional closing fees.

The $75.0 Million Agreement contains certain covenants, including a minimum EBITDA threshold and limitations on the incurrence of indebtedness, liens, asset sales, investments and dividends (all as defined in the agreement). The Alaska SPEs were in compliance with all such covenants as of March 23, 2014. The agent and the lenders under the $75.0 Million Agreement do not have any recourse to our stock or assets (other than the Alaska SPEs or equity interests therein). Defaults under the $75.0 Million Agreement do not give rise to any remedies under the Horizon Lines Debt Agreements.

On January 31, 2013, the fair value of the $75.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $75.0 Million Agreement, we utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $75.0 Million Agreement. We determined the estimated benchmark yield approximated the stated interest rate.

$20.0 Million Term Loan Agreement

On January 31, 2013, we and those of our subsidiaries that are parties (collectively, the “Loan Parties”) to the existing First Lien Notes, the Second Lien Notes, and the 6.00% Convertible Notes (collectively, the “Notes”) entered into a $20.0 million term loan agreement with certain lenders and U.S. Bank, as administrative agent, collateral agent, and ship mortgage trustee (the “$20.0 Million Agreement”). The loan under the $20.0 Million Agreement matures on September 30, 2016 and accrues interest at 8.00% per annum, payable quarterly commencing March 31, 2013 with interest calculated assuming accrual beginning January 8, 2013. The $20.0 Million Agreement does not provide for any amortization of principal, and the full outstanding amount of the loan is payable on September 30, 2016. We are not permitted to optionally prepay the $20.0 Million Agreement except for prepayment in full (together with a prepayment premium equal to 5.0% of the principal amount prepaid) following repayment in full of the First Lien Notes and the $75.0 Million Agreement.

In connection with the issuance of the $20.0 Million Agreement, Horizon Lines paid financing costs of $0.6 million during 2013. The financing costs have been recorded as a reduction to the carrying amount of the $20.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $20.0 Million Agreement.

The covenants in the $20.0 Million Agreement are substantially similar to the negative covenants contained in the indentures governing the Notes, which indentures permit the incurrence of the term loan borrowed under the $20.0 Million Agreement and the contribution of such amounts to Horizon Alaska. The proceeds of the loan borrowed under the $20.0 Million Agreement were contributed to Horizon Alaska to enable it to acquire the Vessels.

On January 31, 2013, the fair value of the $20.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $20.0 Million Agreement, we utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $20.0 Million Agreement. We determined the estimated benchmark yield approximated the stated interest rate.

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6.00% Convertible Notes

On October 5, 2011, we issued $178.8 million in aggregate principal amount of new 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and $99.3 million in aggregate principal amount of new 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, collectively the “6.00% Convertible Notes”). The 6.00% Convertible Notes were issued pursuant to an indenture, which we and the Loan Parties entered into with U.S. Bank, as trustee and collateral agent, on October 5, 2011 (the “6.00% Convertible Notes Indenture”).

During 2012, we completed various debt-to-equity conversions of the 6.00% Convertible Notes. On October 5, 2012, all outstanding Series B Notes not previously converted into shares of our common stock were mandatorily converted into Series A Notes as required by the terms of the 6.00% Convertible Notes Indenture.

Warrants

Certain warrants, not including the warrants issued to SFL, were issued pursuant to a warrant agreement, which we entered into with The Bank of New York Mellon Trust Company, N.A, as warrant agent, on October 5, 2011, as amended by Amendment No. 1, dated December 7, 2011 (the “Warrant Agreement”). Pursuant to the Warrant Agreement, each warrant entitles the holder to purchase common stock at a price of $0.01 per share, subject to adjustment in certain circumstances. In connection with a reverse stock split in December 2011, warrant holders will receive 1/25th of a share of our common stock upon conversion. As of March 23, 2014, there were 1.1 billion warrants outstanding for the purchase of up to 52.9 million shares of our common stock. Upon issuance, in lieu of payment of the exercise price, a warrant holder will have the right (but not the obligation) to require us to convert our warrants, in whole or in part, into shares of our common stock without any required payment or request that we withhold, from the shares of common stock that would otherwise be delivered to such warrant holder, shares issuable upon exercise of the Warrants equal in value to the aggregate exercise price.

Warrant holders will not be permitted to exercise or convert their warrants if and to the extent the shares of common stock issuable upon exercise or conversion would constitute “excess shares” (as defined in our certificate of incorporation) if they were issued in order to abide by the foreign ownership limitations imposed by our certificate of incorporation. In addition, a warrant holder who cannot establish to our reasonable satisfaction that it (or, if not the holder, the person that the holder has designated to receive the common stock upon exercise or conversion) is a United States citizen will not be permitted to exercise or convert its warrants to the extent the receipt of the common stock upon exercise or conversion would cause such person or any person whose ownership position would be aggregated with that of such person to exceed 4.9% of our outstanding common stock.

The warrants contain no provisions allowing us to force redemption, and we have no conditional obligation to redeem or convert the warrants. Each warrant is convertible into shares of our common stock at an exercise price of $0.01 per share, which we have the option to waive. In addition, we have sufficient authorized and unissued shares available to settle the warrants during the maximum period the warrants could remain outstanding. As a result, the warrants do not meet the definition of an asset or liability and were classified as equity on the date of issuance, on December 22, 2013, and on March 23, 2014. The warrants will be evaluated on a continuous basis to determine if equity classification continues to be appropriate.

Goodwill

We review our goodwill, intangible assets and long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be recoverable, and also review goodwill annually. As of March 23, 2014, the carrying value of goodwill was $198.8 million. Earnings estimated to be generated are expected to support the carrying value of goodwill. However, should our operating results be lower from what is expected or other triggering events occur, it could imply that our goodwill may not be recoverable and may result in the recognition of a non-cash write down of goodwill.

Interest Rate Risk

Our primary interest rate exposure relates to the ABL Facility. As of March 23, 2014, we had $13.5 million outstanding under the ABL Facility. The interest rate on the ABL Facility is based on LIBOR or a base rate plus an applicable margin based on leverage and excess availability, as defined in the agreement, ranging from (i) 1.25% to 2.75%, in the case of base rate loans and (ii) 2.25% to 3.75%, in the case of LIBOR loans. Each quarter point change in interest rates would result in a $34 thousand change in annual interest expense on the ABL facility.

Recent Accounting Pronouncements

Accounting pronouncements effective after March 23, 2014 are not expected to have a material effect our consolidated financial position or results of operations.

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Forward Looking Statements

This Form 10-Q (including the exhibits hereto) contains “forward-looking statements” within the meaning of the federal securities laws. These forward-looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that do not relate solely to historical fact. They include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “projects,” “likely,” “will,” “would,” “could” and similar expressions or phrases identify forward-looking statements.

All forward-looking statements involve risks and uncertainties. The occurrence of the events described, and the achievement of the expected results, depend on many events, some or all of which are not predictable or within our control. Actual results may differ materially from expected results.

Factors that may cause actual results to differ from expected results include:

• unfavorable economic conditions in the markets we serve, despite general economic improvement elsewhere,

• our substantial leverage may restrict cash flow and thereby limit our ability to invest in our business,

• the vessels in our fleet continue to age, and we may not have the resources to replace our vessels,

• our ability to obtain financing on acceptable terms to pay for the potential vessel repowering project,

• our ability to manage the potential vessel repowering project effectively to deliver the results we hope to achieve,

• volatility in fuel prices,

• decreases in shipping volumes,

• our ability to maintain adequate liquidity to operate our business,

• our ability to make interest payments on our outstanding indebtedness,

• work stoppages, strikes, and other adverse union actions,

• government investigations and legal proceedings,

• suspension or debarment by the federal government,

• failure to comply with safety and environmental protection and other governmental requirements,

• failure to comply with the terms of our probation,

• increased inspection procedures and tighter import and export controls,

• the start-up of any additional Jones-Act competitors,

• repeal or substantial amendment of the coastwise laws of the United States, also known as the Jones Act,

• catastrophic losses and other liabilities,

• failure to comply with the various ownership, citizenship, crewing, and build requirements dictated by the Jones Act,

• the arrest of our vessels by maritime claimants,

• severe weather and natural disasters, or

• unexpected substantial dry-docking or repair costs for our vessels.

In light of these risks and uncertainties, expected results or other anticipated events or circumstances discussed in this Form 10-Q (including the exhibits hereto) might not occur. We undertake no obligation, and specifically decline any obligation, to publicly update or revise any forward-looking statements, even if experience or future developments make it clear that projected results expressed or implied in such statements will not be realized, except as may be required by law.

See the section entitled “Risk Factors” in our Form 10-K for the fiscal year ended December 22, 2013, as filed with the SEC for a more complete discussion of these risks and uncertainties and for other risks and uncertainties. Those factors and the other risk factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could harm our results. Consequently, there can be no assurance that actual results or developments anticipated by us will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, us. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements.

3. Quantitative and Qualitative Disclosures About Market Risk

We maintain policies for managing risk related to exposure to variability in interest rates, fuel prices and other relevant market rates and prices, which includes entering into derivative instruments in order to mitigate our risks. We do not currently have any derivative instruments outstanding.

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Our exposure to market risk for changes in interest rates is limited to our ABL Facility and one of our operating leases. The interest rate for our ABL Facility is currently indexed to LIBOR of one, two, three, or six months as selected by us (or nine or twelve months, if available, and consented to by the Lenders), or the Alternate Base Rate as defined in the ABL Facility. One of our operating leases is currently indexed to LIBOR of one month.

In addition, at times we utilize derivative instruments tied to various indexes to hedge a portion of our quarterly exposure to bunker fuel price increases. These instruments consist of fixed price swap agreements. We do not use derivative instruments for trading purposes. Credit risk related to the derivative financial instruments is considered minimal and is managed by requiring high credit standards for counterparties. We currently do not have any bunker fuel price hedges in place.

Changes in fair value of derivative financial instruments are recorded as adjustments to the assets or liabilities being hedged in the statement of operations or in accumulated other comprehensive income (loss), depending on whether the derivative is designated and qualifies for hedge accounting, the type of hedge transaction represented, and the effectiveness of the hedge.

4. Controls and Procedures

Disclosure Controls and Procedures

The Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based on such evaluation, each of the Company’s Chief Executive Officer and Chief Financial Officer has concluded that the Company’s disclosure controls and procedures are effective.

Changes in Internal Control

There were no changes in the Company’s internal control over financial reporting during the Company’s fiscal quarter ending March 23, 2014, that have materially affected or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

1. Legal Proceedings

In May 2013, the U.S. Department of Justice declined to intervene in a qui tam complaint filed in the U.S. District Court for the Central District of California by Mario Rizzo under the Federal False Claims Act. The case was unsealed in May 2013, and we were served with a complaint in June 2013. The case is entitled United States of America, ex rel. Mario Rizzo v. Horizon Lines, LLC et al. The qui tam complaint alleges, among other things, that we and another defendant submitted false claims by claiming fuel surcharges in excess of what was permitted by the Department of Defense. The complaint seeks significant damages, penalties and other relief. We have filed responsive pleadings and intend to vigorously defend against the allegations set forth in the complaint.

On March 5, 2014, we entered into a settlement agreement that resolved pending inquiries of the United States Department of Justice on behalf of the United States Postal Service, the United States Department of Agriculture and the United States Department of Defense (collectively, the “United States”). The settlement agreement relates to a federal qui tam complaint filed by the relator, William B. Stallings, in the United States District Court for the Middle District of Florida, entitled United States of America, ex rel. Stallings v. Sea Star Line, LLC et al., pursuant to the qui tam provisions of the False Claims Act. The claims underlying the qui tam civil complaint were the alleged price fixing of certain ocean transportation contracts between the continental United States and Puerto Rico during the period from April 2002 through April 2008 that involved the United States as a customer. This qui tam action was unsealed on March 6, 2014. The settlement agreement provides that we will pay to the United States the total sum of $1.5 million in six different installment payments through April 2015. During the fourth quarter of 2013, we recorded a charge of $1.4 million related to this legal settlement, which represents the present value of the expected future payments.

In the ordinary course of business, from time to time, we become involved in various legal proceedings. These relate primarily to claims for loss or damage to cargo, employees’ personal injury claims, and claims for loss or damage to the person or property of third parties. We generally maintain insurance, subject to customary deductibles or self-retention amounts, and/or reserves to cover these types of claims. We also, from time to time, become involved in routine employment-related disputes and disputes with parties with which it has contractual relations. Our policy is to disclose contingent liabilities associated with both asserted and unasserted claims after all available facts and circumstances have been reviewed and we determines that a loss is reasonably possible. Our policy is to record contingent liabilities associated with both asserted and unasserted claims when it is probable that the liability has been incurred and the amount of the loss is reasonably estimable.

1A. Risk Factors

There have been no material changes from our risk factors as previously reported in our Annual Report on Form 10-K for the fiscal year ended December 22, 2013, as filed with the SEC.

2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

3. Defaults Upon Senior Securities

None.

4. Mine Safety Disclosures

None.

5. Other Information

None.

6. Exhibits

    4.1 Third Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s 11.00% First Lien Senior Secured Notes due 2016 (filed as Exhibit 4.1 to the Company’s report on Form 8-K filed March 26, 2014).

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4.2	Fourth Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes (filed as Exhibit 4.2 to the Company’s report on Form 8-K filed March 26, 2014).
4.3	Fourth Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s Second Lien Senior Secured Notes due 2016 (filed as Exhibit 4.3 to the Company’s report on Form 8-K filed March 26, 2014).
10.1	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s 11.00% First Lien Senior Secured Notes due 2016 (filed as Exhibit 10.1 to the Company’s report on Form 8-K filed March 26, 2014).
10.2	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes (filed as Exhibit 10.2 to the Company’s report on Form 8-K filed March 26, 2014).
10.3	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s Second Lien Senior Secured Notes due 2016 (filed as Exhibit 10.3 to the Company’s report on Form 8-K filed March 26, 2014).
10.4	Joinder No. 1 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Transportation, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.4 to the Company’s report on Form 8-K filed March 26, 2014).
10.5	Joinder No. 2 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Inland, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.5 to the Company’s report on Form 8-K filed March 26, 2014).
10.6	Joinder No. 3 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Technology, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.6 to the Company’s report on Form 8-K filed March 26, 2014).
10.7	Joinder No. 4 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Logistics, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.7 to the Company’s report on Form 8-K filed March 26, 2014).
10.8	Joinder No. 1 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Transportation, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.8 to the Company’s report on Form 8-K filed March 26, 2014).
10.9	Joinder No. 2 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Inland, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.9 to the Company’s report on Form 8-K filed March 26, 2014).
10.10	Joinder No. 3 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Technology, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.10 to the Company’s report on Form 8-K filed March 26, 2014).

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10.11	Joinder No. 4 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Logistics, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.11 to the Company’s report on Form 8-K filed March 26, 2014).
31.1*	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document

* Filed herewith.

** Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

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SIGNATURE

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

Date: May 7, 2014

HORIZON LINES, INC.
By:	/s/ MICHAEL T. AVARA
	Michael T. Avara
	Executive Vice President & Chief Financial Officer (Principal Financial Officer & Authorized Signatory)

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EXHIBIT INDEX

Exhibit No.	Description
4.1	Third Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s 11.00% First Lien Senior Secured Notes due 2016 (filed as Exhibit 4.1 to the Company’s report on Form 8-K filed March 26, 2014).
4.2	Fourth Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes (filed as Exhibit 4.2 to the Company’s report on Form 8-K filed March 26, 2014).
4.3	Fourth Supplemental Indenture, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as Trustee, relating to Horizon’s Second Lien Senior Secured Notes due 2016 (filed as Exhibit 4.3 to the Company’s report on Form 8-K filed March 26, 2014).
10.1	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s 11.00% First Lien Senior Secured Notes due 2016 (filed as Exhibit 10.1 to the Company’s report on Form 8-K filed March 26, 2014).
10.2	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s 6.00% Series A Convertible Senior Secured Notes due 2017 and 6.00% Series B Mandatorily Convertible Senior Secured Notes (filed as Exhibit 10.2 to the Company’s report on Form 8-K filed March 26, 2014).
10.3	Joinder to Security and Pledge Agreement, dated March 20, 2014, among Road Raiders Transportation, Inc., Road Raiders Inland, Inc., Road Raiders Technology, Inc., Road Raiders Logistics, Inc. and U.S. Bank National Association, as collateral agent, relating to Horizon’s Second Lien Senior Secured Notes due 2016 (filed as Exhibit 10.3 to the Company’s report on Form 8-K filed March 26, 2014).
10.4	Joinder No. 1 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Transportation, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.4 to the Company’s report on Form 8-K filed March 26, 2014).
10.5	Joinder No. 2 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Inland, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.5 to the Company’s report on Form 8-K filed March 26, 2014).
10.6	Joinder No. 3 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Technology, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.6 to the Company’s report on Form 8-K filed March 26, 2014).
10.7	Joinder No. 4 to ABL Security Agreement, dated March 6, 2014, between Road Raiders Logistics, Inc. and Wells Fargo Capital Finance, LLC, as agent (filed as Exhibit 10.7 to the Company’s report on Form 8-K filed March 26, 2014).

10.8	Joinder No. 1 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Transportation, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.8 to the Company’s report on Form 8-K filed March 26, 2014).
10.9	Joinder No. 2 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Inland, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.9 to the Company’s report on Form 8-K filed March 26, 2014).
10.10	Joinder No. 3 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Technology, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.10 to the Company’s report on Form 8-K filed March 26, 2014).
10.11	Joinder No. 4 to Guaranty and Security Agreement, dated March 6, 2014, between Road Raiders Logistics, Inc. and U.S. Bank National Association, as agent (filed as Exhibit 10.11 to the Company’s report on Form 8-K filed March 26, 2014).
31.1*	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document

* Filed herewith.

** Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

EX-31.1

Exhibit 31.1

HORIZON LINES, INC.

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEYACT OF 2002

I, Samuel A. Woodward, President and Chief Executive Officer, certify that:

1. I have reviewed this report on Form 10-Q of Horizon Lines, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2014

/s/ SAMUEL A. WOODWARD

Samuel A. Woodward

President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

HORIZON LINES, INC.

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEYACT OF 2002

I, Michael T. Avara, Executive Vice President and Chief Financial Officer, certify that:

1. I have reviewed this report on Form 10-Q of Horizon Lines, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 7, 2014

/s/ MICHAEL T. AVARA

Michael T. Avara

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

HORIZON LINES, INC.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Horizon Lines, Inc. (the “Company”) on Form 10-Q for the period ending March 23, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Samuel A. Woodward, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ SAMUEL A. WOODWARD

Samuel A. Woodward

President and Chief Executive Officer

(Principal Executive Officer)

May 7, 2014

EX-32.2

Exhibit 32.2

HORIZON LINES, INC.

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Horizon Lines, Inc. (the “Company”) on Form 10-Q for the period ending March 23, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael T. Avara, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ MICHAEL T. AVARA

Michael T. Avara

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

May 7, 2014

XML

Property and Equipment - Property and Equipment (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Property, Plant and Equipment [Line Items]
Historical Cost	$ 420,131	$ 418,865
Net Book Value	223,390	226,838
Vessels and Vessel Improvements [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	228,377	227,705
Net Book Value	126,634	129,384
Containers [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	39,652	39,894
Net Book Value	24,218	24,710
Chassis [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	21,289	20,435
Net Book Value	12,520	11,847
Cranes [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	27,829	27,409
Net Book Value	12,140	12,088
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	35,008	34,367
Net Book Value	12,497	11,784
Facilities and Land Improvements [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	30,765	30,065
Net Book Value	21,483	21,171
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	12,763	14,813
Net Book Value	12,763	14,813
Software [Member]
Property, Plant and Equipment [Line Items]
Historical Cost	24,448	24,177
Net Book Value	$ 1,135	$ 1,041

XML

Stock-Based Compensation - Summary of Grants Related to Restricted Stock Units (Detail)	3 Months Ended
	Mar. 23, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	1,151,917
Time-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	1,500,000
Grant RSUs Vested	750,000
Time-Based [Member] | Board of Directors [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	900,000
Grant RSUs Vested	180,000
Time-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	1,109,584
Grant RSUs Vested	221,917
Time-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	120,834
Grant RSUs Vested
Time-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	87,500
Grant RSUs Vested
Performance-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	1,500,000
Grant RSUs Vested
Performance-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	1,109,583
Grant RSUs Vested
Performance-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	120,833
Grant RSUs Vested
Performance-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs Outstanding	87,500
Grant RSUs Vested
March 31, 2014 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	928,833
March 31, 2014 [Member] | Time-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2014 [Member] | Time-Based [Member] | Board of Directors [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	360,000
March 31, 2014 [Member] | Time-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	443,833
March 31, 2014 [Member] | Time-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	72,500
March 31, 2014 [Member] | Time-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	52,500
March 31, 2014 [Member] | Performance-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	2,000,000
December 31, 2014 [Member] | Time-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	500,000
December 31, 2014 [Member] | Time-Based [Member] | Board of Directors [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Time-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Time-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Time-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Performance-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	1,500,000
December 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
December 31, 2014 [Member] | Performance-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2015 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	2,205,084
March 31, 2015 [Member] | Time-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2015 [Member] | Time-Based [Member] | Board of Directors [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	360,000
March 31, 2015 [Member] | Time-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	443,834
March 31, 2015 [Member] | Time-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	48,334
March 31, 2015 [Member] | Time-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	35,000
March 31, 2015 [Member] | Performance-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
March 31, 2015 [Member] | Performance-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	1,109,583
March 31, 2015 [Member] | Performance-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	120,833
March 31, 2015 [Member] | Performance-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	87,500
June 30, 2015 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	250,000
June 30, 2015 [Member] | Time-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested	250,000
June 30, 2015 [Member] | Time-Based [Member] | Board of Directors [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Time-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Time-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Time-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Performance-Based [Member] | CEO [Member] | July 5, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Performance-Based [Member] | Management [Member] | July 25, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Performance-Based [Member] | Management [Member] | December 26, 2012 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested
June 30, 2015 [Member] | Performance-Based [Member] | Management [Member] | June 1, 2013 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant RSUs Vested

XML

Organization - Additional Information (Detail)	3 Months Ended
	Mar. 23, 2014
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Minimum percentage of ownership by domestic citizens subsidiary in shipping business	75.00%

XML

Accrued Liabilities - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	0 Months Ended	3 Months Ended
	Mar. 05, 2014	Mar. 23, 2014 On or Before March 24, 2015 [Member]	Mar. 23, 2014 On or Before March 21, 2016 [Member]
Loss Contingencies [Line Items]
Payments related to the plea agreement with the Antitrust Division	$ 1.5	$ 4.0	$ 4.0
Payment date		Mar. 24, 2015	Mar. 21, 2016

XML

Net Loss Per Common Share - Net Loss Per Common Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 23, 2014	Mar. 24, 2013
Numerator:
Net loss from continuing operations	$ (26,275)	$ (20,073)
Net income (loss) from discontinued operations	37	(278)
Net loss	$ (26,238)	$ (20,351)
Denominator for basic net loss per common share:
Weighted average shares outstanding	39,917	34,746
Effect of dilutive securities:
Stock-based compensation
Warrants to purchase common stock
Denominator for diluted net loss per common share	39,917	34,746
Basic and diluted net loss per common share:
From continuing operations	$ (0.66)	$ (0.58)
From discontinued operations		$ (0.01)
Basic and diluted net loss per common share	$ (0.66)	$ (0.59)

XML

Long-Term Debt

3 Months Ended

Mar. 23, 2014

Debt Disclosure [Abstract]

Long-Term Debt

3. Long-Term Debt

As of the dates below, long-term debt consisted of the following (in thousands):

	March 23,			December 22,
	2014			2013
First lien notes	$	222,213		$	222,381
Second lien notes		194,269			187,129
$75.0 million term loan agreement		73,504			73,282
$20.0 million term loan agreement		19,598			19,572
ABL facility		13,500			—
Capital lease obligations		13,040			12,415
6.0% convertible notes		1,500			1,539
Total long-term debt		537,624			516,318
Less current portion		(13,753	)		(11,473	)
Long-term debt, net of current portion	$	523,871		$	504,845

On October 5, 2011, the Company issued the 6.00% Convertible Notes. On October 5, 2011, Horizon Lines issued the First Lien Notes, the Second Lien Notes, and entered into the ABL Facility, and on January 31, 2013, entered into the $20.0 Million Agreement. On January 31, 2013, Horizon Lines Alaska Vessels, LLC (“Horizon Alaska”), the Company’s newly formed special purpose subsidiary, entered into the $75.0 Million Agreement. The 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, the ABL Facility, the $20.0 Million Agreement (collectively, the “Horizon Lines Debt Agreements”), and the $75.0 Million Agreement are defined and described below.

Per the terms of the Horizon Lines Debt Agreements, the Alaska SPEs (as defined below) are not required to be a party thereto, are considered “Unrestricted Subsidiaries” under the 6.00% Convertible Notes, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement, and do not guarantee any of the Horizon Lines Debt Agreements.

The 6.00% Convertible Notes are fully and unconditionally guaranteed by the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above. The ABL Facility, the First Lien Notes, the Second Lien Notes, and the $20.0 Million Agreement are fully and unconditionally guaranteed by the Company and each of its subsidiaries other than Horizon Lines and the Unrestricted Subsidiaries.

The ABL Facility is secured on a first-priority basis by liens on the accounts receivable, deposit accounts, securities accounts, investment property (other than equity interests of the subsidiaries and joint ventures of the Company) and cash, in each case with certain exceptions, of the Company and the Company’s subsidiaries other than the Unrestricted Subsidiaries identified above (collectively, the “ABL Priority Collateral”). Substantially all other assets of the Company and the Company’s subsidiaries, other than the assets of the Unrestricted Subsidiaries identified above, also serve as collateral for the Horizon Lines Debt Agreements (collectively, such other assets are the “Secured Notes Priority Collateral”).

The following table summarizes the guarantors and non-guarantors of each of the Horizon Lines Debt Agreements:

	ABL Facility	$20 Million Agreement	First Lien Notes	Second Lien Notes	6% Convertible Notes	$75 Million Agreement
Horizon Lines, Inc.	Guarantor	Guarantor	Guarantor	Guarantor	Issuer	Non-Guarantor
Horizon Lines, LLC	Issuer	Issuer	Issuer	Issuer	Guarantor	Non-Guarantor
Horizon Alaska	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Issuer
Horizon Vessels	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Alaska Terminals	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Road Raiders Inland, Inc. and subsidiaries	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor
Other subsidiaries of the Company not specifically listed above	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor

The following table lists the order of lien priority for each of the Horizon Lines Debt Agreements on the Secured Notes Priority Collateral and the ABL Priority Collateral, as applicable:

	Secured Notes Priority Collateral	ABL Priority Collateral
$20 Million Agreement	First	Second
First Lien Notes	Second	Third
Second Lien Notes	Third	Fourth
6.0% Convertible Notes	Fourth	Fifth
ABL Facility	Fifth	First

First Lien Notes

The 11.00% First Lien Senior Secured Notes (the “First Lien Notes”) were issued pursuant to an indenture on October 5, 2011. The First Lien Notes bear interest at a rate of 11.0% per annum, payable semiannually, and mature on October 15, 2016. The First Lien Notes are callable at par plus accrued and unpaid interest. Horizon Lines is obligated to make mandatory prepayments of 1%, on an annual basis, of the original principal amount. These prepayments are payable on a semiannual basis and commenced on April 15, 2012.

The First Lien Notes contain affirmative and negative covenants which are typical for senior secured high-yield notes with no financial maintenance covenants. The First Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the First Lien Notes was $228.4 million, which reflected Horizon Lines’ ability to call the First Lien Notes at 101.5% during the first year and at par thereafter. The original issue premium of $3.4 million is being amortized through interest expense through the maturity of the First Lien Notes.

Second Lien Notes

The 13.00%-15.00% Second Lien Senior Secured Notes (the “Second Lien Notes”) were issued pursuant to an indenture on October 5, 2011.

The Second Lien Notes bear interest at a rate of either: (i) 13% per annum, payable semiannually in cash in arrears; (ii) 14% per annum, 50% of which is payable semiannually in cash in arrears and 50% is payable in kind; or (iii) 15% per annum payable in kind, payable semiannually beginning on April 15, 2012, and maturing on October 15, 2016. The Second Lien Notes were non-callable for two years from the date of their issuance, and thereafter the Second Lien Notes are callable by Horizon Lines at (i) 106% of their aggregate principal amount, plus accrued and unpaid interest thereon in the third year, (ii) 103% of their aggregate principal amount, plus accrued and unpaid interest thereon in the fourth year, and (iii) at par plus accrued and unpaid interest thereafter.

On April 15, 2012, October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $7.9 million, $8.1 million, $8.7 million and $9.4 million, respectively, of Second Lien Notes to satisfy the payment-in-kind interest obligation under the Second Lien Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the Second Lien Notes due April 15, 2014 by issuing $10.1 million additional Second Lien Notes. As such, as of March 23, 2014, Horizon Lines has recorded $8.8 million of accrued interest as an increase to long-term debt.

The Second Lien Notes contain affirmative and negative covenants that are typical for senior secured high-yield notes with no financial maintenance covenants. The Second Lien Notes contain other covenants, including: change of control put at 101% (subject to a permitted holder exception); limitation on asset sales; limitation on incurrence of indebtedness and preferred stock; limitation on restricted payments; limitation on restricted investments; limitation on liens; limitation on dividends; limitation on affiliate transactions; limitation on sale/leaseback transactions; limitation on guarantees by restricted subsidiaries; and limitation on mergers, consolidations and sales of all/substantially all of the assets of Horizon Lines. These covenants are subject to certain exceptions and qualifications. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

On October 5, 2011, the fair value of the Second Lien Notes was $96.6 million. The original issue discount of $3.4 million is being amortized through interest expense through the maturity of the Second Lien Notes.

During 2012, the Company and Horizon Lines entered into a Global Termination Agreement with Ship Finance International Limited (“SFL”) whereby Horizon Lines issued $40.0 million aggregate principal amount of its Second Lien Notes and warrants to purchase 9,250,000 shares of the Company’s common stock at a price of $0.01 per share to satisfy its obligations for certain vessel leases. The Second Lien Notes issued to SFL (the “SFL Notes”) have the same terms as the Second Lien Notes issued on October 5, 2011 (the “Initial Notes”), except that they are subordinated to the Initial Notes in the case of a bankruptcy, and holders of the SFL Notes, so long as then held by SFL, have the option to purchase the Initial Notes in the event of a bankruptcy. On April 9, 2012, the fair value of the SFL Notes outstanding on such date approximated face value. On October 15, 2012, April 15, 2013 and October 15, 2013, Horizon Lines issued an additional $3.1 million, $3.2 million and $3.5 million, respectively, of SFL Notes to satisfy the payment-in-kind interest obligation under the SFL Notes. In addition, Horizon Lines elected to satisfy its interest obligation under the SFL Notes due April 15, 2014 by issuing $3.7 million additional SFL Notes. As such, as of March 23, 2014, Horizon Lines has recorded $3.3 million of accrued interest as an increase to long-term debt.

ABL Facility

On October 5, 2011, Horizon Lines entered into a $100.0 million asset-based revolving credit facility (the “ABL Facility”) with Wells Fargo Capital Finance, LLC (“Wells Fargo”). Use of the ABL Facility is subject to compliance with a customary borrowing base limitation. The ABL Facility includes an up to $30.0 million letter of credit sub-facility and a swingline sub-facility up to $15.0 million, with Wells Fargo serving as administrative agent and collateral agent. Horizon Lines has the option to request increases in the maximum commitment under the ABL Facility by up to $25.0 million in the aggregate; however, such incremental facility increases have not been committed to in advance. The ABL Facility is available to be used by Horizon Lines for working capital and other general corporate purposes.

The ABL Facility was amended on January 31, 2013 in conjunction with the $75.0 Million Agreement and $20.0 Million Agreement. In addition to allowing for the incurrence of the additional long-term debt under those agreements, amendments to the ABL Facility included, among other changes, (i) permission to make certain investments in the Alaska SPEs, including the proceeds of the $20.0 Million Agreement and the arrangements related to the charters and the sublease of the terminal facility licenses for the Vessels (as defined below), (ii) excluding the Alaska SPEs from the guarantee and collateral requirements of the ABL Facility and from the restrictions of the negative covenants and certain other provisions, (iii) weekly borrowing base reporting in the event availability under the facility falls below a threshold of (a) $14.0 million or (b) 14.0% of the maximum commitment under the ABL Facility, (iv) the exclusion of certain historical charges and expenses relating to discontinued operations and severance from the calculation of bank-defined Adjusted EBITDA, (v) the exclusion of the historical charter hire expense deriving from the Vessels from the calculation of bank-defined Adjusted EBITDA, and (vi) the inclusion of pro forma interest expense on the $75.0 Million Agreement and the $20.0 Million Agreement in the calculation of fixed charges.

The ABL Facility matures October 5, 2016 (but 90 days earlier if the First Lien Notes and the Second Lien Notes are not repaid or refinanced as of such date). The interest rate on the ABL Facility is LIBOR or a base rate plus an applicable margin based on leverage and excess availability, as defined in the agreement, ranging from (i) 1.25% to 2.75%, in the case of base rate loans and (ii) 2.25% to 3.75%, in the case of LIBOR loans. A fee ranging from 0.375% to 0.50% per annum will accrue on unutilized commitments under the ABL Facility. As of March 23, 2014, borrowings outstanding under the ABL facility totaled $13.5 million and total borrowing availability was $47.1 million. Horizon Lines had $12.1 million of letters of credit outstanding as of March 23, 2014.

The ABL Facility requires compliance with a minimum fixed charge coverage ratio test if excess availability is less than the greater of (i) $12.5 million or (ii) 12.5% of the maximum commitment under the ABL Facility. In addition, the ABL Facility includes certain customary negative covenants that, subject to certain materiality thresholds, baskets and other agreed upon exceptions and qualifications, will limit, among other things, indebtedness, liens, asset sales and other dispositions, mergers, liquidations, dissolutions and other fundamental changes, investments and acquisitions, dividends, distributions on equity or redemptions and repurchases of capital stock, transactions with affiliates, repayments of certain debt, conduct of business and change of control. The ABL Facility also contains certain customary representations and warranties, affirmative covenants and events of default, as well as provisions requiring compliance with applicable citizenship requirements of the Jones Act. Horizon Lines was in compliance with all such applicable covenants as of March 23, 2014.

$75.0 Million Term Loan Agreement

Three of Horizon Lines’ Jones Act-qualified vessels: the Horizon Anchorage, Horizon Tacoma, and Horizon Kodiak (collectively, the “Vessels”) were previously chartered. The charter for the Vessels was due to expire in January 2015. On January 31, 2013, the Company, through its newly formed subsidiary Horizon Alaska, acquired off of charter the Vessels for a purchase price of approximately $91.8 million.

On January 31, 2013, Horizon Alaska, together with two newly formed subsidiaries of Horizon Lines, Horizon Lines Alaska Terminals, LLC (“Alaska Terminals”) and Horizon Lines Merchant Vessels, LLC (“Horizon Vessels”), entered into an approximately $75.8 million term loan agreement with certain lenders and U.S. Bank National Association (“U.S. Bank”), as the

administrative agent, collateral agent and ship mortgage trustee (the “$75.0 Million Agreement”). The obligations under the $75.0 Million Agreement are secured by a first-priority lien on substantially all of the assets of Horizon Alaska, Horizon Vessels, and Alaska Terminals (collectively, the “Alaska SPEs”), which primarily includes the Vessels. The operations of the Alaska SPEs are limited to a bareboat charter of the Vessels between Horizon Alaska and Horizon Lines and a sublease of a terminal facility in Anchorage, Alaska between Alaska Terminals and Horizon Lines of Alaska.

The loan under the $75.0 Million Agreement accrues interest at 10.25% per annum, payable quarterly commencing March 31, 2013. Amortization of loan principal is payable in equal quarterly installments, commencing on March 31, 2014, and each amortization installment will equal 2.5% of the total initial loan amount (which may increase to 3.75% upon specified events). The full remaining outstanding amount of the loan under the $75.0 Million Agreement is payable on September 30, 2016. The proceeds of the loan under the $75.0 Million Agreement were utilized by Horizon Alaska to acquire the Vessels. In connection with the borrowing under the $75.0 Million Agreement, the Alaska SPEs paid financing costs of $2.5 million during 2013, which included loan commitment fees of $1.5 million. The financing costs have been recorded as a reduction to the carrying amount of the $75.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $75.0 Million Agreement. In addition to the commitment fees of $1.5 million paid in cash at closing, the Alaska SPEs will also pay, at maturity of the $75.0 Million Agreement, an additional $0.8 million of closing fees by increasing the original $75.0 million principal amount. The Company is recording non-cash interest accretion through maturity of the $75.0 Million Agreement related to the additional closing fees.

The $75.0 Million Agreement contains certain covenants, including a minimum EBITDA threshold and limitations on the incurrence of indebtedness, liens, asset sales, investments and dividends (all as defined in the agreement). The Alaska SPEs were in compliance with all such covenants as of March 23, 2014. The agent and the lenders under the $75.0 Million Agreement do not have any recourse to the stock or assets of the Company or any of its subsidiaries (other than the Alaska SPEs or equity interests therein). Defaults under the $75.0 Million Agreement do not give rise to any remedies under the Horizon Lines Debt Agreements.

On January 31, 2013, the fair value of the $75.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $75.0 Million Agreement, the Company utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $75.0 Million Agreement. The Company determined the estimated benchmark yield approximated the stated interest rate.

$20.0 Million Term Loan Agreement

On January 31, 2013, the Company and those of its subsidiaries that are parties (collectively, the “Loan Parties”) to the existing First Lien Notes, the Second Lien Notes, and the 6.00% Convertible Notes (collectively, the “Notes”) entered into a $20.0 million term loan agreement with certain lenders and U.S. Bank, as administrative agent, collateral agent, and ship mortgage trustee (the “$20.0 Million Agreement”). The loan under the $20.0 Million Agreement matures on September 30, 2016 and accrues interest at 8.00% per annum, payable quarterly. The $20.0 Million Agreement does not provide for any amortization of principal, and the full outstanding amount of the loan is payable on September 30, 2016. Horizon Lines is not permitted to optionally prepay the $20.0 Million Agreement except for prepayment in full (together with a prepayment premium equal to 5.0% of the principal amount prepaid) following repayment in full of the First Lien Notes and the $75.0 Million Agreement.

In connection with the issuance of the $20.0 Million Agreement, Horizon Lines paid financing costs of $0.6 million during 2013. The financing costs have been recorded as a reduction to the carrying amount of the $20.0 Million Agreement and will be amortized through non-cash interest expense through maturity of the $20.0 Million Agreement.

The covenants in the $20.0 Million Agreement are substantially similar to the negative covenants contained in the indentures governing the Notes, which indentures permit the incurrence of the term loan borrowed under the $20.0 Million Agreement and the contribution of such amounts to Horizon Alaska. The proceeds of the loan borrowed under the $20.0 Million Agreement were contributed to Horizon Alaska to enable it to acquire the Vessels.

On January 31, 2013, the fair value of the $20.0 Million Agreement approximated face value and was classified within level 2 of the fair value hierarchy. In determining the estimated fair value of the $20.0 Million Agreement, the Company utilized a quantitatively derived rating estimate and creditworthiness analysis, a credit rating gap analysis, and an analysis of credit market transactions. These analyses were used to estimate a benchmark yield, which was compared to the stated interest rate in the $20.0 Million Agreement. The Company determined the estimated benchmark yield approximated the stated interest rate.

6.00% Convertible Notes

On October 5, 2011, the Company issued $178.8 million in aggregate principal amount of new 6.00% Series A Convertible Senior Secured Notes due 2017 (the “Series A Notes”) and $99.3 million in aggregate principal amount of new 6.00% Series B Mandatorily Convertible Senior Secured Notes (the “Series B Notes” and, together with the Series A Notes, collectively the “6.00% Convertible Notes”). The 6.00% Convertible Notes were issued pursuant to an indenture, which the Company and the Loan Parties entered into with U.S. Bank , as trustee and collateral agent, on October 5, 2011 (the “6.00% Convertible Notes Indenture”).

During 2012, the Company completed various debt-to-equity conversions of the 6.00% Convertible Notes. On October 5, 2012, all outstanding Series B Notes not previously converted into shares of the Company’s common stock were mandatorily converted into Series A Notes as required by the terms of the 6.00% Convertible Notes Indenture. As of March 23, 2014, $2.0 million face value of the Series A Notes remains outstanding. The Series A Notes bear interest at a rate of 6.00% per annum, payable semiannually. The Series A Notes mature on April 15, 2017 and are convertible at the option of the holders, and at the Company’s option under certain circumstances, into shares of the Company’s common stock or warrants, as the case may be. Upon conversion, foreign holders may, under certain conditions, receive warrants in lieu of shares of common stock.

The conversion rate of the remaining Series A Notes may be increased in certain circumstances to compensate the holders thereof for the loss of the time value of the conversion right (i) if at any time the Company’s common stock or the common stock into which the new notes may be converted is greater than or equal to $11.25 per share and is not listed on the NYSE or NASDAQ markets or (ii) if a change of control occurs, unless at least 90% of the consideration received or to be received by holders of common stock, excluding cash payments for fractional shares, in connection with the transaction or transactions constituting the change of control, consists of shares of common stock, American Depositary Receipts or American Depositary Shares traded on a national securities exchange in the United States or which will be so traded or quoted when issued or exchanged in connection with such change of control. Upon a change of control, holders will have the right to require the Company to repurchase for cash the outstanding Series A Notes at 101% of the aggregate principal amount, plus accrued and unpaid interest.

The long-term debt and embedded conversion options associated with the 6.00% Convertible Notes were recorded on the Company’s balance sheet at their fair value on October 5, 2011. On October 5, 2011, the fair value of the long-term debt portion of the Series A Notes and Series B Notes was $105.6 million and $58.6 million, respectively. The original issue discounts associated with the 6.00% Convertible Notes still outstanding are being amortized through interest expense through the maturity of the Series A Notes.

Warrants

Certain warrants, not including the warrants issued to SFL, were issued pursuant to a warrant agreement, which the Company entered into with The Bank of New York Mellon Trust Company, N.A, as warrant agent, on October 5, 2011, as amended by Amendment No. 1, dated December 7, 2011 (the “Warrant Agreement”). Pursuant to the Warrant Agreement, each warrant entitles the holder to purchase common stock at a price of $0.01 per share, subject to adjustment in certain circumstances. In connection with a reverse stock split in December 2011, warrant holders will receive 1/25th of a share of the Company’s common stock upon conversion. As of March 23, 2014 there were 1.1 billion warrants outstanding for the purchase of up to 52.9 million shares of the Company’s common stock. Upon issuance, in lieu of payment of the exercise price, a warrant holder will have the right (but not the obligation) to require the Company to convert its warrants, in whole or in part, into shares of its common stock without any required payment or request that the Company withhold, from the shares of common stock that would otherwise be delivered to such warrant holder, shares issuable upon exercise of the Warrants equal in value to the aggregate exercise price.

Warrant holders will not be permitted to exercise or convert their warrants if and to the extent the shares of common stock issuable upon exercise or conversion would constitute “excess shares” (as defined in the Company’s certificate of incorporation) if they were issued in order to abide by the foreign ownership limitations imposed by the Company’s certificate of incorporation. In addition, a warrant holder who cannot establish to the Company’s reasonable satisfaction that it (or, if not the holder, the person that the holder has designated to receive the common stock upon exercise or conversion) is a United States citizen will not be permitted to exercise or convert its warrants to the extent the receipt of the common stock upon exercise or conversion would cause such person or any person whose ownership position would be aggregated with that of such person to exceed 4.9% of the Company’s outstanding common stock.

The warrants contain no provisions allowing the Company to force redemption, and there is no conditional obligation of the Company to redeem or convert the warrants. Each warrant is convertible into shares of the Company’s common stock at an exercise price of $0.01 per share, which the Company has the option to waive. In addition, the Company has sufficient authorized and unissued shares available to settle the warrants during the maximum period the warrants could remain outstanding. As a result, the warrants do not meet the definition of an asset or liability and were classified as equity on the date of issuance, on December 22, 2013, and on March 23, 2014. The warrants will be evaluated on a continuous basis to determine if equity classification continues to be appropriate.

Fair Value of Financial Instruments

The estimated fair value of the Company’s debt as of March 23, 2014 and December 22, 2013 totaled $501.2 million and $488.9 million, respectively. The fair value of the First Lien Notes and the Second Lien Notes is based upon quoted market prices. The fair value of the other long-term debt approximates carrying value.

XML

Commitments and Contingencies - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	0 Months Ended	3 Months Ended
	Mar. 05, 2014 Installment	Dec. 22, 2013	Mar. 23, 2014
Commitments And Contingencies Disclosure [Abstract]
Settlement agreement amount	$ 1.5
Number of installment payments for settlement agreement amount	6
Charge recorded related to legal settlement		1.4
Letters of credit amount		$ 12.9	$ 12.1

XML

Long-Term Debt - Summary of Information Related to Guarantors and Non-Guarantors of Each of the Debt Agreements (Detail)	3 Months Ended
	Mar. 23, 2014
Horizon Lines, Inc. [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
Horizon Lines, LLC [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
Horizon Alaska [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
Horizon Vessels [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
Alaska Terminals [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
Road Raiders Inland, Inc. and Subsidiaries [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
Other Subsidiaries of the Company [Member] | Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$20.0 Million Term Loan Agreement [Member] | Horizon Lines, Inc. [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$20.0 Million Term Loan Agreement [Member] | Horizon Lines, LLC [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
$20.0 Million Term Loan Agreement [Member] | Horizon Alaska [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
$20.0 Million Term Loan Agreement [Member] | Horizon Vessels [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
$20.0 Million Term Loan Agreement [Member] | Alaska Terminals [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
$20.0 Million Term Loan Agreement [Member] | Road Raiders Inland, Inc. and Subsidiaries [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$20.0 Million Term Loan Agreement [Member] | Other Subsidiaries of the Company [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
First Lien Notes [Member] | Horizon Lines, Inc. [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
First Lien Notes [Member] | Horizon Lines, LLC [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
First Lien Notes [Member] | Horizon Alaska [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
First Lien Notes [Member] | Horizon Vessels [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
First Lien Notes [Member] | Alaska Terminals [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
First Lien Notes [Member] | Road Raiders Inland, Inc. and Subsidiaries [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
First Lien Notes [Member] | Other Subsidiaries of the Company [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
Second Lien Notes [Member] | Horizon Lines, Inc. [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
Second Lien Notes [Member] | Horizon Lines, LLC [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
Second Lien Notes [Member] | Horizon Alaska [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
Second Lien Notes [Member] | Horizon Vessels [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
Second Lien Notes [Member] | Alaska Terminals [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
Second Lien Notes [Member] | Road Raiders Inland, Inc. and Subsidiaries [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
Second Lien Notes [Member] | Other Subsidiaries of the Company [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
6.0% Convertible Notes [Member] | Horizon Lines, Inc. [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
6.0% Convertible Notes [Member] | Horizon Lines, LLC [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
6.0% Convertible Notes [Member] | Horizon Alaska [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
6.0% Convertible Notes [Member] | Horizon Vessels [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
6.0% Convertible Notes [Member] | Alaska Terminals [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Unrestricted
6.0% Convertible Notes [Member] | Road Raiders Inland, Inc. and Subsidiaries [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
6.0% Convertible Notes [Member] | Other Subsidiaries of the Company [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$75.0 Million Term Loan Agreement [Member] | Horizon Lines, Inc. [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
$75.0 Million Term Loan Agreement [Member] | Horizon Lines, LLC [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
$75.0 Million Term Loan Agreement [Member] | Horizon Alaska [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Issuer
$75.0 Million Term Loan Agreement [Member] | Horizon Vessels [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$75.0 Million Term Loan Agreement [Member] | Alaska Terminals [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Guarantor
$75.0 Million Term Loan Agreement [Member] | Road Raiders Inland, Inc. and Subsidiaries [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor
$75.0 Million Term Loan Agreement [Member] | Other Subsidiaries of the Company [Member]
Debt Instrument [Line Items]
Description of guarantors and non-guarantors relationship for debt agreements	Non-Guarantor

XML

Long-Term Debt - Components of Long-Term Debt (Parenthetical) (Detail) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Mar. 23, 2014	Dec. 22, 2013	Jan. 31, 2013
$75.0 Million Term Loan Agreement [Member]
Debt Instrument [Line Items]
Debt instrument principal amount		$ 75.0	$ 75.0	$ 75.0
Senior notes stated percentage				10.25%
$20.0 Million Term Loan Agreement [Member]
Debt Instrument [Line Items]
Debt instrument principal amount		$ 20.0	$ 20.0	$ 20.0
Senior notes stated percentage				8.00%
6.0% Convertible Notes [Member]
Debt Instrument [Line Items]
Senior notes stated percentage	6.00%	6.00%	6.00%	6.00%

XML

Long-Term Debt - Order of Lien Priority on Debt Agreements for Priority Collateral (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended				3 Months Ended		3 Months Ended
	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member]	Mar. 23, 2014 $20.0 Million Term Loan Agreement [Member]	Dec. 22, 2013 $20.0 Million Term Loan Agreement [Member]	Jan. 31, 2013 $20.0 Million Term Loan Agreement [Member]	Mar. 23, 2014 First Lien Notes [Member]	Oct. 05, 2011 First Lien Notes [Member]	Mar. 23, 2014 Second Lien Notes [Member]	Mar. 23, 2014 6.0% Convertible Notes [Member]	Mar. 31, 2014 6.0% Convertible Notes [Member]	Dec. 22, 2013 6.0% Convertible Notes [Member]	Jan. 31, 2013 6.0% Convertible Notes [Member]
Debt Instrument [Line Items]
Secured Notes Priority Collateral	Fifth	First			Second		Third	Fourth
ABL Priority Collateral	First	Second			Third		Fourth	Fifth
Debt instrument principal amount		$ 20.0	$ 20.0	$ 20.0
Senior notes stated percentage				8.00%		11.00%		6.00%	6.00%	6.00%	6.00%

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Long-Term Debt - Additional Information (Detail) (USD $)	3 Months Ended				0 Months Ended	3 Months Ended	0 Months Ended		3 Months Ended										3 Months Ended						0 Months Ended	12 Months Ended			0 Months Ended	12 Months Ended						3 Months Ended			3 Months Ended			3 Months Ended										3 Months Ended		3 Months Ended
	Mar. 23, 2014 Vessel	Mar. 24, 2013	Dec. 22, 2013	Dec. 23, 2012	Jan. 31, 2013 D-7 Vessels [Member]	Mar. 23, 2014 Warrants [Member]	Jan. 31, 2013 Asset Based Revolving Credit Facility [Member]	Oct. 05, 2011 Asset Based Revolving Credit Facility [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Minimum [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Minimum [Member] Base Rate Loan [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Minimum [Member] LIBOR Rate Loan [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Maximum [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Maximum [Member] Base Rate Loan [Member]	Mar. 23, 2014 Asset Based Revolving Credit Facility [Member] Maximum [Member] LIBOR Rate Loan [Member]	Oct. 05, 2011 Letter of Credit Sub-Facility [Member] Asset Based Revolving Credit Facility [Member]	Oct. 05, 2011 Swingline Sub Facility [Member] Asset Based Revolving Credit Facility [Member]	Jan. 31, 2013 $20.0 Million Term Loan Agreement [Member] Significant Other Observable Inputs (Level 2) [Member]	Mar. 23, 2014 SFL Second Lien Notes Due 2016 [Member]	Oct. 15, 2013 SFL Second Lien Notes Due 2016 [Member]	Apr. 15, 2013 SFL Second Lien Notes Due 2016 [Member]	Dec. 23, 2012 SFL Second Lien Notes Due 2016 [Member]	Oct. 15, 2012 SFL Second Lien Notes Due 2016 [Member]	Apr. 15, 2014 SFL Second Lien Notes Due 2016 [Member] Subsequent Event [Member]	Jan. 31, 2013 $75.0 Million Term Loan Agreement [Member]	Dec. 22, 2013 $75.0 Million Term Loan Agreement [Member]	Mar. 23, 2014 $75.0 Million Term Loan Agreement [Member]	Jan. 31, 2013 $75.0 Million Term Loan Agreement [Member] Significant Other Observable Inputs (Level 2) [Member]	Jan. 31, 2013 $20.0 Million Term Loan Agreement [Member]	Dec. 22, 2013 $20.0 Million Term Loan Agreement [Member]	Mar. 23, 2014 $20.0 Million Term Loan Agreement [Member]	Mar. 31, 2014 6.0% Convertible Notes [Member]	Mar. 23, 2014 6.0% Convertible Notes [Member]	Dec. 22, 2013 6.0% Convertible Notes [Member]	Jan. 31, 2013 6.0% Convertible Notes [Member]	Mar. 23, 2014 6.0% Convertible Notes [Member] Series A Convertible Senior Secured Notes [Member]	Oct. 05, 2011 6.0% Convertible Notes [Member] Series A Convertible Senior Secured Notes [Member]	Oct. 05, 2011 6.0% Convertible Notes [Member] Series B Mandatorily Convertible Senior Secured Notes [Member]	Mar. 23, 2014 First Lien Notes [Member]	Dec. 22, 2013 First Lien Notes [Member]	Oct. 05, 2011 First Lien Notes [Member]	Mar. 23, 2014 Second Lien Notes [Member]	Dec. 22, 2013 Second Lien Notes [Member]	Oct. 15, 2013 Second Lien Notes [Member]	Apr. 15, 2013 Second Lien Notes [Member]	Oct. 15, 2012 Second Lien Notes [Member]	Apr. 15, 2012 Second Lien Notes [Member]	Oct. 05, 2011 Second Lien Notes [Member]	Apr. 15, 2014 Second Lien Notes [Member] Subsequent Event [Member]	Oct. 05, 2011 Second Lien Notes [Member] Minimum [Member]	Oct. 05, 2011 Second Lien Notes [Member] Maximum [Member]	Mar. 23, 2014 Second Lien Notes [Member] Interest Rate Criteria One [Member]	Mar. 23, 2014 Second Lien Notes [Member] Interest Rate Criteria One [Member] Minimum [Member]	Mar. 23, 2014 Second Lien Notes [Member] Interest Rate Criteria Two [Member]	Mar. 23, 2014 Second Lien Notes [Member] Interest Rate Criteria Three [Member] Maximum [Member]
Debt Instrument [Line Items]
Senior notes stated percentage																									10.25%				8.00%			6.00%	6.00%	6.00%	6.00%		6.00%	6.00%			11.00%									13.00%	15.00%		13.00%	14.00%	15.00%
Convertible senior notes date of maturity																													Sep. 30, 2016							Apr. 15, 2017			Oct. 15, 2016			Oct. 15, 2016
Senior secured notes, date of first required payment																																							Apr. 15, 2012			Apr. 15, 2012
Senior secured notes, mandatory prepayment percentage on annual basis																																							1.00%
Percentage of change of control in other covenants																																							101.00%			101.00%
Debt instruments, fair value of company's debt	$ 501,200,000		$ 488,900,000																																		$ 105,600,000	$ 58,600,000			$ 228,400,000							$ 96,600,000
Senior secured notes, original issue discount or premium																																							(3,400,000)			3,400,000
Senior secured notes, percentage price of principal amount at which notes can be called																																							101.50%													106.00%		103.00%
Percentage of interest payable in cash in arrears																																										50.00%
Percentage of interest payable in kind																																										50.00%
Senior secured notes, periods for which notes cannot be called																																										2 years
Additional second lien note to satisfy interest obligation									12,500,000											3,500,000	3,200,000		3,100,000	3,700,000																				9,400,000	8,700,000	8,100,000	7,900,000		10,100,000
Accrued interest recorded as an increase to long-term debt																			3,300,000																							8,800,000
Senior secured notes issued to SFL, aggregate principal amount																						40,000,000
Warrants issued to SFL to purchase company's common stock				9,250,000
Common stock per share value	$ 0.01		$ 0.01	$ 0.01																																$ 11.25
Revolving credit facility maximum borrowing capacity								100,000,000								30,000,000	15,000,000
Optional increase in maximum commitment under asset based lending facility							14,000,000	25,000,000
Debt instrument principal amount																		20,000,000							75,000,000	75,000,000	75,000,000	75,000,000	20,000,000	20,000,000	20,000,000						178,800,000	99,300,000
Percentage of borrowing on maximum borrowing capacity under line of credit facility							14.00%		12.50%
Maturity date									Oct. 05, 2016
Advance maturity date description									90 days earlier
Debt instrument basis spread on variable rate											1.25%	2.25%		2.75%	3.75%
Variable commitment fee on the unused portion of the commitment										0.375%			0.50%
Borrowing outstanding	537,624,000		516,318,000						13,500,000																	73,282,000	73,504,000			19,572,000	19,598,000		1,500,000	1,539,000					222,213,000	222,381,000		194,269,000	187,129,000
Current borrowing capacity under senior credit facility									47,100,000
Letters of credit amount	12,100,000		12,900,000						12,100,000
Number of previously chartered vessels	3
Chartered vessels expiration date	2015-01
Purchase price of vessels					91,800,000
Amount of first term loan agreement with certain lenders																									75,800,000
Quarterly amortization installment percentage																									2.50%
Increase in amortization installment percentage																									3.75%
Payment of financing costs	11,000	5,289,000																								2,500,000				600,000
Loan commitment fees																										1,500,000
Additional loan closing fee																										800,000
Debt instrument prepayment premium, percentage																													5.00%
Debt instrument, remaining outstanding amount																																				$ 2,000,000
Percentage of consideration received by stockholders																																				90.00%
Percentage of repurchase rate on principal amount																																				101.00%
Conversion price of warrants per common shares						0.01
Warrants outstanding						1,100,000,000
Common stock, shares issued	38,928,000		38,928,000			52,900,000
Common stock conversion ratio						1/25
Ownership position						4.90%

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Basis of Presentation

3 Months Ended

Mar. 23, 2014

Accounting Policies [Abstract]

Basis of Presentation

2. Basis of Presentation

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany items have been eliminated in consolidation.

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X, and accordingly, certain financial information has been condensed and certain footnote disclosures have been omitted. Such information and disclosures are normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). These financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 22, 2013. The Company uses a 52 or 53 week (every sixth or seventh year) fiscal year that ends on the Sunday before the last Friday in December.

The financial statements as of March 23, 2014 and the financial statements for the quarters ended March 23, 2014 and March 24, 2013 are unaudited; however, in the opinion of management, such statements include all adjustments necessary for the fair presentation of the financial information included herein, which are of a normal recurring nature. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions and to use judgment that affects the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. Results of operations for interim periods are not necessarily indicative of results for the full year.

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Stock-Based Compensation - Compensation Cost Included in Selling, General, and Administration Expenses (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 23, 2014	Mar. 24, 2013
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total Compensation Costs	$ 733	$ 1,601
Restricted Stock Units [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Compensation Costs	711	1,540
Restricted Stock [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Compensation Costs	$ 22	$ 61

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Intangible Assets - Schedule of Intangible Assets (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Finite-Lived Intangible Assets [Line Items]
Total intangibles with definite lives	$ 220,921	$ 220,921
Accumulated amortization	(188,789)	(185,767)
Net intangibles with definite lives	32,132	35,154
Goodwill	198,793	198,793
Intangible assets, net	230,925	233,947
Customer Contracts/Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangibles with definite lives	141,430	141,430
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangibles with definite lives	63,800	63,800
Deferred Financing Costs [Member]
Finite-Lived Intangible Assets [Line Items]
Total intangibles with definite lives	$ 15,691	$ 15,691

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Current assets
Cash	$ 1,479	$ 5,236
Accounts receivable, net of allowance of $4,834 and $3,984 at March 23, 2014 and December 22, 2013, respectively	114,376	100,460
Materials and supplies	26,193	23,369
Deferred tax asset	1,140	1,140
Other current assets	8,537	8,915
Total current assets	151,725	139,120
Property and equipment, net	223,390	226,838
Goodwill	198,793	198,793
Intangible assets, net	32,132	35,154
Other long-term assets	26,086	24,702
Total assets	632,126	624,607
Current liabilities
Accounts payable	48,050	49,897
Current portion of long-term debt, including capital leases	13,753	11,473
Other accrued liabilities	93,686	77,406
Total current liabilities	155,489	138,776
Long-term debt, including capital leases, net of current portion	523,871	504,845
Deferred tax liability	1,571	1,391
Other long-term liabilities	20,461	23,387
Total liabilities	701,392	668,399
Stockholders' deficiency
Preferred stock, $.01 par value, 30,500 shares authorized, no shares issued or outstanding
Common stock, $.01 par value, 150,000 shares authorized, 38,928 and 38,885 shares issued and outstanding as of March 23, 2014 and December 22, 2013, respectively	999	999
Additional paid in capital	384,768	384,073
Accumulated deficit	(456,129)	(429,891)
Accumulated other comprehensive income	1,096	1,027
Total stockholders' deficiency	(69,266)	(43,792)
Total liabilities and stockholders' deficiency	$ 632,126	$ 624,607

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 23, 2014	Mar. 24, 2013
Cash flows from operating activities:
Net loss from continuing operations	$ (26,275)	$ (20,073)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	6,276	6,112
Amortization of other intangible assets	2,176	3,459
Amortization of vessel dry-docking	4,949	3,032
Amortization of deferred financing costs	846	752
Restructuring charge	5	4,844
Gain on change in value of debt conversion features	(71)	(45)
Deferred income taxes	135	116
Gain on equipment disposals	(217)	(1,038)
Stock-based compensation	733	1,601
Payment-in-kind interest expense	6,972	6,232
Accretion of interest on debt	290	171
Other non-cash interest accretion	284	265
Changes in operating assets and liabilities:
Accounts receivable	(13,885)	(6,540)
Materials and supplies	(2,823)	3,640
Other current assets	378	(707)
Accounts payable	(1,843)	(5,919)
Accrued liabilities	16,206	13,680
Vessel rent		(777)
Vessel dry-docking payments	(5,060)	(4,438)
Legal settlement payments	(4,000)	(6,500)
Other assets/liabilities	(218)	(683)
Net cash used in operating activities from continuing operations	(15,142)	(2,816)
Net cash used in operating activities from discontinued operations	(102)	(752)
Cash flows from investing activities:
Purchases of property and equipment	(1,938)	(93,105)
Proceeds from the sale of property and equipment	839	2,329
Net cash used in investing activities	(1,099)	(90,776)
Cash flows from financing activities:
Issuance of debt		95,000
Payments on ABL facility	(12,200)	(11,500)
Borrowing under ABL facility	25,700
Payment of financing costs	(11)	(5,289)
Payments on capital lease obligations	(903)	(536)
Net cash provided by financing activities	12,586	77,675
Net decrease in cash from continuing operations	(3,655)	(15,917)
Net decrease in cash from discontinued operations	(102)	(752)
Net decrease in cash	(3,757)	(16,669)
Cash at beginning of period	5,236	27,839
Cash at end of period	$ 1,479	$ 11,170

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Stock-Based Compensation - Summary of Restricted Stock Units (Detail) (USD $)	3 Months Ended
	Mar. 23, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Vested, Number of Shares	(1,151,917)
Restricted Stock Units [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Nonvested, Number of Shares, Beginning Balance	5,883,917
Granted, Number of Shares
Vested, Number of Shares	(500,000)
Forfeited, Number of Shares
Nonvested, Number of Shares, Ending Balance	5,383,917
Nonvested, Weighted-Average Fair Value at Grant Date, Beginning Balance	$ 1.85
Granted, Weighted-Average Fair Value at Grant Date
Vested, Weighted-Average Fair Value at Grant Date	$ 1.95
Forfeited, Weighted-Average Fair Value at Grant Date
Nonvested, Weighted-Average Fair Value at Grant Date, Ending Balance	$ 1.84

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Property and Equipment (Tables)

3 Months Ended

Mar. 23, 2014

Property Plant And Equipment [Abstract]

Property and Equipment

Property and equipment consists of the following (in thousands):

	March 23, 2014				December 22, 2013
	Historical		Net Book		Historical		Net Book
	Cost		Value		Cost		Value
Vessels and vessel improvements	$	228,377	$	126,634	$	227,705	$	129,384
Containers		39,652		24,218		39,894		24,710
Chassis		21,289		12,520		20,435		11,847
Cranes		27,829		12,140		27,409		12,088
Machinery and equipment		35,008		12,497		34,367		11,784
Facilities and land improvements		30,765		21,483		30,065		21,171
Software		24,448		1,135		24,177		1,041
Construction in progress		12,763		12,763		14,813		14,813
Total	$	420,131	$	223,390	$	418,865	$	226,838

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Stock-Based Compensation - Summary of Restricted Stock Awards (Detail) (USD $)	3 Months Ended
	Mar. 23, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Vested, Number of Shares	(1,151,917)
Restricted Stock [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Nonvested, Number of Shares, Beginning Balance	3,343
Granted, Number of Shares
Vested, Number of Shares	(3,343)
Forfeited, Number of Shares
Nonvested, Weighted-Average Fair Value at Grant Date, Beginning Balance	$ 89.75
Granted, Weighted-Average Fair Value at Grant Date
Vested, Weighted-Average Fair Value at Grant Date	$ 89.75
Forfeited, Weighted-Average Fair Value at Grant Date

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Accrued Liabilities (Tables)

3 Months Ended

Mar. 23, 2014

Payables And Accruals [Abstract]

Other Current Accrued Liabilities

Other current accrued liabilities consist of the following (in thousands):

	March 23, 2014		December 22, 2013
Vessel operations	$	17,237	$	12,286
Payroll and employee benefits		16,704		16,101
Marine operations		8,918		5,382
Terminal operations		9,535		8,477
Fuel		8,889		5,193
Interest		12,922		6,817
Legal settlements		3,758		4,382
Restructuring		476		587
Other liabilities		15,247		18,181
Total other current accrued liabilities	$	93,686	$	77,406

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Organization

3 Months Ended

Mar. 23, 2014

Accounting Policies [Abstract]

Organization

1. Organization

Horizon Lines, Inc. (the “Company”) operates as a holding company for Horizon Lines, LLC (“Horizon Lines”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Lines of Alaska, LLC (“Horizon Lines of Alaska”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Logistics, LLC (“Horizon Logistics”), a Delaware limited liability company and wholly-owned subsidiary, Horizon Lines of Puerto Rico, Inc. (“HLPR”), a Delaware corporation and wholly-owned subsidiary, Hawaii Stevedores, Inc. (“HSI”), a Hawaii corporation and wholly-owned subsidiary, as well as Road Raiders Transportation, Inc. and Road Raiders Logistics, Inc. (collectively, “Road Raiders”), Delaware corporations and wholly-owned subsidiaries.

Horizon Lines operates as a Jones Act container shipping business with primary service to ports within the continental United States, Alaska, Hawaii, and Puerto Rico. Under the Jones Act, all vessels transporting cargo between covered locations must, subject to limited exceptions, be built in the U.S., registered under the U.S. flag, manned by predominantly U.S. crews, and owned and operated by U.S.-organized companies that are controlled and 75% owned by U.S. citizens. Horizon Lines also offers terminal services. HLPR operates as an agent for Horizon Lines in Puerto Rico and also provides terminal services in Puerto Rico. The Company also provides certain third-party logistics services via its Road Raiders subsidiaries.

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Statement Of Financial Position [Abstract]
Allowance on accounts receivable	$ 4,834	$ 3,984
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	30,500	30,500
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	150,000	150,000
Common stock, shares issued	38,928	38,928
Common stock, shares outstanding	38,885	38,885

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Recent Accounting Pronouncements

3 Months Ended

Mar. 23, 2014

Accounting Changes And Error Corrections [Abstract]

Recent Accounting Pronouncements

11. Recent Accounting Pronouncements

Accounting pronouncements effective after March 23, 2014 are not expected to have a material effect on the Company’s consolidated financial position or results of operations.

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Document and Entity Information	3 Months Ended
	Mar. 23, 2014	Apr. 30, 2014
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 23, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Entity Registrant Name	HORIZON LINES, INC.
Entity Central Index Key	0001302707
Current Fiscal Year End Date	--12-21
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		38,927,784

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Basis of Presentation (Policies)

3 Months Ended

Mar. 23, 2014

Accounting Policies [Abstract]

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X, and accordingly, certain financial information has been condensed and certain footnote disclosures have been omitted. Such information and disclosures are normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). These financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 22, 2013. The Company uses a 52 or 53 week (every sixth or seventh year) fiscal year that ends on the Sunday before the last Friday in December.

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Condensed Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 23, 2014	Mar. 24, 2013
Income Statement [Abstract]
Operating revenue	$ 251,935	$ 244,491
Operating expense:
Cost of services (excluding depreciation expense)	226,554	212,608
Depreciation and amortization	8,452	9,571
Amortization of vessel dry-docking	4,949	3,032
Selling, general and administrative	20,165	19,736
Restructuring charge	5	4,844
Miscellaneous expense (income) net	378	(1,005)
Total operating expense	260,503	248,786
Operating loss	(8,568)	(4,295)
Other expense:
Interest expense, net	17,494	15,700
Gain on change in value of debt conversion features	(71)	(45)
Other expense, net	1	3
Loss from continuing operations before income tax expense	(25,992)	(19,953)
Income tax expense	283	120
Net loss from continuing operations	(26,275)	(20,073)
Net income (loss) from discontinued operations	37	(278)
Net loss	$ (26,238)	$ (20,351)
Basic and diluted net loss per share:
Continuing operations	$ (0.66)	$ (0.58)
Discontinued operations		$ (0.01)
Basic and diluted net loss per share	$ (0.66)	$ (0.59)
Number of weighted average shares used in calculations:
Basic	39,917	34,746
Diluted	39,917	34,746

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Net Loss per Common Share

3 Months Ended

Mar. 23, 2014

Earnings Per Share [Abstract]

Net Loss per Common Share

6. Net Loss per Common Share

Basic net loss per share is computed by dividing net loss by the weighted daily average number of shares of common stock outstanding during the period. Diluted net loss per share is based upon the weighted daily average number of shares of common stock outstanding for the period plus dilutive potential shares of common stock, including stock options and warrants to purchase common stock, using the treasury-stock method.

Net loss per share is as follows (in thousands, except per share amounts):

	Quarters Ended
	March 23,			March 24,
	2014			2013
Numerator:
Net loss from continuing operations	$	(26,275	)	$	(20,073	)
Net income (loss) from discontinued operations		37			(278	)
Net loss	$	(26,238	)	$	(20,351	)
Denominator:
Denominator for basic net loss per common share:
Weighted average shares outstanding		39,917			34,746
Effect of dilutive securities:
Stock-based compensation		—			—
Warrants to purchase common stock		—			—
Denominator for diluted net loss per common share		39,917			34,746
Basic and diluted net loss per common share:
From continuing operations	$	(0.66	)	$	(0.58	)
From discontinued operations		—			(0.01	)
Basic and diluted net loss per common share	$	(0.66	)	$	(0.59	)

Warrants outstanding to purchase 52.3 million and 56.4 million common shares have been excluded from the denominator for calculating diluted net loss per share during the quarters ended March 23, 2014 and March 24, 2013, respectively, as the impact would be anti-dilutive.

On August 27, 2012, the Company adopted a rights plan (the “Rights Plan”) intended to avoid an “ownership change” within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended, and thereby preserve the current ability of the Company to utilize certain net operating loss carryovers and other tax benefits of the Company. As part of the Rights Agreement, the Company authorized and declared a dividend distribution of one right (a “Right”) for each outstanding share of Common Stock to stockholders of record at the close of business on September 7, 2012. Each Right entitles the holder to purchase from the Company a unit consisting of one ten-thousandth of a share (a “Unit”) of Series A Participating Preferred Stock, par value $0.01 per share, of the Company (the “Preferred Stock”) at a purchase price of $8.00 per Unit, subject to adjustment (the “Purchase Price”). Until a Right is exercised, the holder thereof, as such, will have no separate rights as a stockholder of the Company, including the right to vote or to receive dividends in respect of Rights. The issuance of the Rights alone does not cause any change in the number of shares deliverable upon the exercise of the Company’s outstanding warrants or convertible notes, or the exercise price or conversion price (as applicable) thereof. In its 2014 proxy statement for the Annual Meeting of Stockholders to be held June 5, 2014, the Company included a proposal soliciting stockholder approval of the Rights Plan. If the Company does not receive the affirmative vote of the majority of shares present in person or represented by proxy at the June 5, 2014 Annual Meeting of Stockholders, then the Company intends to take action to repeal the Rights Plan.

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Stock-Based Compensation

3 Months Ended

Mar. 23, 2014

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

5. Stock-Based Compensation

Stock-based compensation costs are measured at the grant date, based on the estimated fair value of the award, and are recognized as an expense in the income statement over the requisite service period. Compensation costs related to stock options, restricted shares and restricted stock units (“RSUs”) granted under the Amended and Restated Equity Incentive Plan (the “Plan”), the 2009 Incentive Compensation Plan (the “2009 Plan”), and the 2012 Incentive Compensation Plan (“the 2012 Plan”) are recognized using the straight-line method, net of estimated forfeitures. Stock options and restricted shares granted to employees under the Plan and the 2009 Plan typically cliff vest and become fully exercisable on the third anniversary of the grant date, provided the employee who was granted such options/restricted shares is continuously employed by the Company or its subsidiaries through such date, and provided any performance based criteria, if any, are met. RSUs granted under the 2012 Plan typically contain a graded vesting schedule with a portion vesting each year over a three-year period.

The following compensation costs are included within selling, general, and administrative expenses on the condensed consolidated statements of operations (in thousands):

	Quarters Ended
	March 23, 2014		March 24, 2013
Restricted stock units	$	711	$	1,540
Restricted stock		22		61
Total	$	733	$	1,601

Restricted Stock Units

The following table details grants of RSUs during 2012 and 2013:

					RSUs Vested
		Total			as of		Potential Future Vesting Dates
Grant Date	Recipient	RSUs Outstanding		Vesting Criteria	March 23, 2014		March 31, 2014		December 31, 2014		March 31, 2015		June 30, 2015
July 5, 2012	CEO		1,500,000	Time-Based		750,000		—		500,000		—		250,000
July 5, 2012	CEO		1,500,000	Performance-Based		—		—		1,500,000		—		—
July 25, 2012	Board of Directors		900,000	Time-Based		180,000		360,000		—		360,000		—
July 25, 2012	Management		1,109,584	Time-Based		221,917		443,833		—		443,834		—
July 25, 2012	Management		1,109,583	Performance-Based		—		—		—		1,109,583		—
December 26, 2012	Management		120,834	Time-Based		—		72,500		—		48,334		—
December 26, 2012	Management		120,833	Performance-Based		—		—		—		120,833		—
June 1, 2013	Management		87,500	Time-Based		—		52,500		—		35,000		—
June 1, 2013	Management		87,500	Performance-Based		—		—		—		87,500		—
						1,151,917		928,833		2,000,000		2,205,084		250,000

The grant date fair value of the RSUs granted during 2012 and 2013 was determined using the closing price of the Company’s common stock on the grant date. The time-based RSUs will vest solely if the employee remains in continuous employment with the Company. A portion of the performance-based RSUs would have vested on March 31, 2013 and March 31, 2014, however, the Company did not meet the performance goals established for 2012 or 2013. Accordingly, the Company did not record any expense during 2012 or 2013 related to these performance-based RSUs. Per the terms of the agreement, if any of the performance-based RSUs do not vest on their assigned performance date solely because the performance goals are not met, then such RSUs shall remain outstanding and shall be eligible to vest on subsequent performance dates to the extent performance goals are established and met for such subsequent year. The performance-based RSUs will vest on December 31, 2014 and March 31, 2015 if certain performance goals for 2014 are met and the employee remains in continuous employment with the Company.

Each vested RSU shall be settled within 30 days following termination of the employment with the Company or termination of the director’s service as a member of the Board of Directors. All of the vested RSUs granted to the Company’s Chief Executive Officer and members of its Board of Directors shall be settled in shares of the Company’s common stock. Fifty percent of the vested RSUs granted to members of the Company’s management shall be settled in shares of the Company’s common stock and the remaining 50% of such vested RSUs shall be settled, in the discretion of the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”), either in shares of the Company’s common stock, cash or any combination thereof. The amount of any cash is to be determined based on the value of a share of the Company’s common stock on the settlement date.

A summary of the status of the Company’s RSU awards as of March 23, 2014 is presented below:

Restricted Stock Units	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		5,883,917		$	1.85
Granted		—
Vested		(500,000	)		1.95
Forfeited		—
Nonvested at March 23, 2014		5,383,917		$	1.84

As of March 23, 2014, there was $6.2 million of unrecognized compensation expense related to the RSUs. A total of $3.3 million is expected to be recognized over a weighted-average period of one year. The remaining $2.9 million is not expected to be recognized since the Company does not expect to meet the performance criteria established for 2014.

Restricted Stock

A summary of the status of the Company’s restricted stock awards as of March 23, 2014 is presented below:

Restricted Shares	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		3,343		$	89.75
Granted		—
Vested		(3,343	)	$	89.75
Forfeited		—
Nonvested at March 23, 2014		—

As of March 23, 2014, there was no unrecognized compensation costs related to all restricted stock awards.

Stock Options

The Company’s stock option plan provides for grants of stock options to key employees at prices not less than the fair market value of the Company’s common stock on the grant date. The Company has not granted any stock options since 2008. As of both March 23, 2014 and December 22, 2013, there were outstanding and exercisable options to purchase 26,829 shares of the Company’s common stock at a weighted average exercise price of $402.25 per share. The weighted average remaining contractual term of the outstanding and exercisable options is 2.3 years. As of March 23, 2014, there was no unrecognized compensation costs related to stock options.

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Intangible Assets (Tables)

3 Months Ended

Mar. 23, 2014

Goodwill And Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets

Intangible assets consist of the following (in thousands):

	March 23,			December 22,
	2014			2013
Customer contracts/relationships	$	141,430		$	141,430
Trademarks		63,800			63,800
Deferred financing costs		15,691			15,691
Total intangibles with definite lives		220,921			220,921
Accumulated amortization		(188,789	)		(185,767	)
Net intangibles with definite lives		32,132			35,154
Goodwill		198,793			198,793
Intangible assets, net	$	230,925		$	233,947

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Long-Term Debt (Tables)

3 Months Ended

Mar. 23, 2014

Debt Disclosure [Abstract]

Components of Long-Term Debt

As of the dates below, long-term debt consisted of the following (in thousands):

	March 23,			December 22,
	2014			2013
First lien notes	$	222,213		$	222,381
Second lien notes		194,269			187,129
$75.0 million term loan agreement		73,504			73,282
$20.0 million term loan agreement		19,598			19,572
ABL facility		13,500			—
Capital lease obligations		13,040			12,415
6.0% convertible notes		1,500			1,539
Total long-term debt		537,624			516,318
Less current portion		(13,753	)		(11,473	)
Long-term debt, net of current portion	$	523,871		$	504,845

Summary of Information Related to Guarantors and Non-Guarantors of Each of the Debt Agreements

The following table summarizes the guarantors and non-guarantors of each of the Horizon Lines Debt Agreements:

	ABL Facility	$20 Million Agreement	First Lien Notes	Second Lien Notes	6% Convertible Notes	$75 Million Agreement
Horizon Lines, Inc.	Guarantor	Guarantor	Guarantor	Guarantor	Issuer	Non-Guarantor
Horizon Lines, LLC	Issuer	Issuer	Issuer	Issuer	Guarantor	Non-Guarantor
Horizon Alaska	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Issuer
Horizon Vessels	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Alaska Terminals	Non-Guarantor	Unrestricted	Unrestricted	Unrestricted	Unrestricted	Guarantor
Road Raiders Inland, Inc. and subsidiaries	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor
Other subsidiaries of the Company not specifically listed above	Guarantor	Guarantor	Guarantor	Guarantor	Guarantor	Non-Guarantor

Order of Lien Priority on Debt Agreements for Priority Collateral

The following table lists the order of lien priority for each of the Horizon Lines Debt Agreements on the Secured Notes Priority Collateral and the ABL Priority Collateral, as applicable:

	Secured Notes Priority Collateral	ABL Priority Collateral
$20 Million Agreement	First	Second
First Lien Notes	Second	Third
Second Lien Notes	Third	Fourth
6.0% Convertible Notes	Fourth	Fifth
ABL Facility	Fifth	First

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Accrued Liabilities

3 Months Ended

Mar. 23, 2014

Payables And Accruals [Abstract]

Accrued Liabilities

9. Accrued Liabilities

Other current accrued liabilities consist of the following (in thousands):

	March 23, 2014		December 22, 2013
Vessel operations	$	17,237	$	12,286
Payroll and employee benefits		16,704		16,101
Marine operations		8,918		5,382
Terminal operations		9,535		8,477
Fuel		8,889		5,193
Interest		12,922		6,817
Legal settlements		3,758		4,382
Restructuring		476		587
Other liabilities		15,247		18,181
Total other current accrued liabilities	$	93,686	$	77,406

The Company has recorded certain of its legal settlements at their net present value and is recording accretion of the liability balance through interest expense. In addition to the current accrued liabilities related to legal settlements, the Company also has commitments to make payments after March 23, 2015. The Company is required to make payments related to the plea agreement with the Antitrust Division of the Department of Justice of $4.0 million on or before March 24, 2015 and $4.0 million on or before March 21, 2016, both of which are included in other long-term liabilities.

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Property and Equipment

3 Months Ended

Mar. 23, 2014

Property Plant And Equipment [Abstract]

Property and Equipment

7. Property and Equipment

Property and equipment consists of the following (in thousands):

	March 23, 2014				December 22, 2013
	Historical		Net Book		Historical		Net Book
	Cost		Value		Cost		Value
Vessels and vessel improvements	$	228,377	$	126,634	$	227,705	$	129,384
Containers		39,652		24,218		39,894		24,710
Chassis		21,289		12,520		20,435		11,847
Cranes		27,829		12,140		27,409		12,088
Machinery and equipment		35,008		12,497		34,367		11,784
Facilities and land improvements		30,765		21,483		30,065		21,171
Software		24,448		1,135		24,177		1,041
Construction in progress		12,763		12,763		14,813		14,813
Total	$	420,131	$	223,390	$	418,865	$	226,838

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Intangible Assets

3 Months Ended

Mar. 23, 2014

Goodwill And Intangible Assets Disclosure [Abstract]

Intangible Assets

8. Intangible Assets

Intangible assets consist of the following (in thousands):

	March 23,			December 22,
	2014			2013
Customer contracts/relationships	$	141,430		$	141,430
Trademarks		63,800			63,800
Deferred financing costs		15,691			15,691
Total intangibles with definite lives		220,921			220,921
Accumulated amortization		(188,789	)		(185,767	)
Net intangibles with definite lives		32,132			35,154
Goodwill		198,793			198,793
Intangible assets, net	$	230,925		$	233,947

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Commitments and Contingencies

3 Months Ended

Mar. 23, 2014

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

10. Commitments and Contingencies

Legal Proceedings

In May 2013, the U.S. Department of Justice declined to intervene in a qui tam complaint filed in the U.S. District Court for the Central District of California by Mario Rizzo under the Federal False Claims Act. The case was unsealed in May 2013, and the Company was served with a complaint in June 2013. The case is entitled United States of America, ex rel. Mario Rizzo v. Horizon Lines, LLC et al. The qui tam complaint alleges, among other things, that the Company and another defendant submitted false claims by claiming fuel surcharges in excess of what was permitted by the Department of Defense. The complaint seeks significant damages, penalties and other relief. The Company has filed responsive pleadings and intends to vigorously defend against the allegations set forth in the complaint.

On March 5, 2014, the Company entered into a settlement agreement that resolved pending inquiries of the United States Department of Justice on behalf of the United States Postal Service, the United States Department of Agriculture and the United States Department of Defense (collectively, the “United States”). The settlement agreement relates to a federal qui tam complaint filed by the relator, William B. Stallings, in the United States District Court for the Middle District of Florida, entitled United States of America, ex rel. Stallings v. Sea Star Line, LLC et al., pursuant to the qui tam provisions of the False Claims Act. The claims underlying the qui tam civil complaint were the alleged price fixing of certain ocean transportation contracts between the continental United States and Puerto Rico during the period from April 2002 through April 2008 that involved the United States as a customer. This qui tam action was unsealed on March 6, 2014. The settlement agreement provides that the Company will pay to the United States the total sum of $1.5 million in six different installment payments through April 2015. During the fourth quarter of 2013, the Company recorded a charge of $1.4 million related to this legal settlement, which represents the present value of the expected future payments.

In the ordinary course of business, from time to time, the Company becomes involved in various legal proceedings. These relate primarily to claims for loss or damage to cargo, employees’ personal injury claims, and claims for loss or damage to the person or property of third parties. The Company generally maintains insurance, subject to customary deductibles or self-retention amounts, and/or reserves to cover these types of claims. The Company also, from time to time, becomes involved in routine employment-related disputes and disputes with parties with which it has contractual relations. The Company’s policy is to disclose contingent liabilities associated with both asserted and unasserted claims after all available facts and circumstances have been reviewed and the Company determines that a loss is reasonably possible. The Company’s policy is to record contingent liabilities associated with both asserted and unasserted claims when it is probable that the liability has been incurred and the amount of the loss is reasonably estimable.

Standby Letters of Credit

The Company has standby letters of credit, primarily related to its property and casualty insurance programs, as well as customs bonds. On March 23, 2014 and December 22, 2013, these letters of credit totaled $12.1 million and $12.9 million, respectively.

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Stock-Based Compensation - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 23, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total unrecognized compensation expense	$ 3,300,000
Remaining unrecognized compensation expense	2,900,000
Outstanding and exercisable, Number of Options	26,829
Outstanding and exercisable, Weighted-Average Exercise Price	$ 402.25
Weighted-Average Remaining Contractual Term	2 years 3 months 18 days
Restricted Stock Units [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Settlement period of RSU	30 days
Unrecognized compensation expense	6,200,000
Weighted-average period	1 year
Restricted Stock Units [Member] | Employment Contracts [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Vested RSUs settled in shares of the Company's common stock	50.00%
Performance Shares [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Vested RSUs settled in shares of the Company's common stock	50.00%
Restricted Stock [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation expense	0
Stock Option [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation expense	$ 0

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Net Loss per Common Share (Tables)

3 Months Ended

Mar. 23, 2014

Earnings Per Share [Abstract]

Net Loss per Common Share

Net loss per share is as follows (in thousands, except per share amounts):

	Quarters Ended
	March 23,			March 24,
	2014			2013
Numerator:
Net loss from continuing operations	$	(26,275	)	$	(20,073	)
Net income (loss) from discontinued operations		37			(278	)
Net loss	$	(26,238	)	$	(20,351	)
Denominator:
Denominator for basic net loss per common share:
Weighted average shares outstanding		39,917			34,746
Effect of dilutive securities:
Stock-based compensation		—			—
Warrants to purchase common stock		—			—
Denominator for diluted net loss per common share		39,917			34,746
Basic and diluted net loss per common share:
From continuing operations	$	(0.66	)	$	(0.58	)
From discontinued operations		—			(0.01	)
Basic and diluted net loss per common share	$	(0.66	)	$	(0.59	)

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Basis of Presentation - Additional Information (Detail)	3 Months Ended
	Mar. 23, 2014
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Number of week used for fiscal year every sixth year by entity	364 days
Number of week used for fiscal year every seventh year by entity	371 days

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Accrued Liabilities - Other Current Accrued Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Payables And Accruals [Abstract]
Vessel operations	$ 17,237	$ 12,286
Payroll and employee benefits	16,704	16,101
Marine operations	8,918	5,382
Terminal operations	9,535	8,477
Fuel	8,889	5,193
Interest	12,922	6,817
Legal settlements	3,758	4,382
Restructuring	476	587
Other liabilities	15,247	18,181
Total other current accrued liabilities	$ 93,686	$ 77,406

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Condensed Consolidated Statements of Comprehensive Loss (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 23, 2014	Mar. 24, 2013
Statement Of Income And Comprehensive Income [Abstract]
Net loss	$ (26,238)	$ (20,351)
Other comprehensive income:
Amortization of pension and post-retirement benefit transition obligation, net of tax	69	159
Other comprehensive income	69	159
Comprehensive loss	$ (26,169)	$ (20,192)

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Income Taxes

3 Months Ended

Mar. 23, 2014

Income Tax Disclosure [Abstract]

Income Taxes

4. Income Taxes

The Company continues to believe it will not generate sufficient taxable income to realize its deferred tax assets. Accordingly, the Company maintains a valuation allowance against its deferred tax assets. The valuation allowance is reviewed quarterly and will be maintained until sufficient positive evidence exists to support the reversal of the valuation allowance. In addition, until such time the Company determines it is more likely than not that it will generate sufficient taxable income to realize its deferred tax assets, income tax enefits associated with future-period losses will be fully reserved, except for intraperiod allocations of income tax expense.

As a result of the loss from continuing operations and income from discontinued operations and other comprehensive income during 2014, the Company is required to record a tax benefit from continuing operations with an offsetting tax expense from discontinued operations and other comprehensive income. For the quarter ended March 23, 2014 the Company has recorded a tax benefit in continuing operations due to intraperiod allocations of income tax expense, resulting in lower net tax expense in continuing operations. As such, the Company’s tax benefit recorded in continuing operations will approximate the income from discontinued operations and other comprehensive income multiplied by the statutory tax rate during 2014.

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Long-Term Debt - Components of Long-Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 23, 2014	Dec. 22, 2013
Debt Instrument [Line Items]
Total long-term debt	$ 537,624	$ 516,318
Less current portion	(13,753)	(11,473)
Long-term debt, net of current portion	523,871	504,845
First Lien Notes [Member]
Debt Instrument [Line Items]
Total long-term debt	222,213	222,381
Second Lien Notes [Member]
Debt Instrument [Line Items]
Total long-term debt	194,269	187,129
$75.0 Million Term Loan Agreement [Member]
Debt Instrument [Line Items]
Total long-term debt	73,504	73,282
$20.0 Million Term Loan Agreement [Member]
Debt Instrument [Line Items]
Total long-term debt	19,598	19,572
Capital Lease Obligations [Member]
Debt Instrument [Line Items]
Total long-term debt	13,040	12,415
6.0% Convertible Notes [Member]
Debt Instrument [Line Items]
Total long-term debt	1,500	1,539
Asset Based Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Total long-term debt	$ 13,500

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Net Loss Per Common Share - Additional Information (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	0 Months Ended			3 Months Ended
	Aug. 27, 2012	Mar. 23, 2014	Dec. 22, 2013	Mar. 23, 2014 Warrants [Member]	Mar. 24, 2013 Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total number of shares excluded from denominator for basic net loss per share				52.3	56.4
Common stock purchase rights share	$ 0.01
Preferred stock, par value	$ 0.01	$ 0.01	$ 0.01
Preferred stock, purchase price	$ 8.00

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Stock-Based Compensation (Tables)

3 Months Ended

Mar. 23, 2014

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Compensation Cost Included in Selling, General, and Administration Expenses

The following compensation costs are included within selling, general, and administrative expenses on the condensed consolidated statements of operations (in thousands):

	Quarters Ended
	March 23, 2014		March 24, 2013
Restricted stock units	$	711	$	1,540
Restricted stock		22		61
Total	$	733	$	1,601

Summary of Grants Related to Restricted Stock Units

The following table details grants of RSUs during 2012 and 2013:

					RSUs Vested
		Total			as of		Potential Future Vesting Dates
Grant Date	Recipient	RSUs Outstanding		Vesting Criteria	March 23, 2014		March 31, 2014		December 31, 2014		March 31, 2015		June 30, 2015
July 5, 2012	CEO		1,500,000	Time-Based		750,000		—		500,000		—		250,000
July 5, 2012	CEO		1,500,000	Performance-Based		—		—		1,500,000		—		—
July 25, 2012	Board of Directors		900,000	Time-Based		180,000		360,000		—		360,000		—
July 25, 2012	Management		1,109,584	Time-Based		221,917		443,833		—		443,834		—
July 25, 2012	Management		1,109,583	Performance-Based		—		—		—		1,109,583		—
December 26, 2012	Management		120,834	Time-Based		—		72,500		—		48,334		—
December 26, 2012	Management		120,833	Performance-Based		—		—		—		120,833		—
June 1, 2013	Management		87,500	Time-Based		—		52,500		—		35,000		—
June 1, 2013	Management		87,500	Performance-Based		—		—		—		87,500		—
						1,151,917		928,833		2,000,000		2,205,084		250,000

Summary of Restricted Stock Units

A summary of the status of the Company’s RSU awards as of March 23, 2014 is presented below:

Restricted Stock Units	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		5,883,917		$	1.85
Granted		—
Vested		(500,000	)		1.95
Forfeited		—
Nonvested at March 23, 2014		5,383,917		$	1.84

Summary of Restricted Stock Awards

A summary of the status of the Company’s restricted stock awards as of March 23, 2014 is presented below:

Restricted Shares	Number of Shares			Weighted- Average Fair Value at Grant Date
Nonvested at December 22, 2013		3,343		$	89.75
Granted		—
Vested		(3,343	)	$	89.75
Forfeited		—
Nonvested at March 23, 2014		—