HL Proposed Rate Increase

Effective October 1, 2007

Dear Valued Customer:

In reference to the recently announced tariff changes, please not the following revisions:

Effective October 1st, 2007, Horizon Lines will increase its public tariff 414 for shipments moving Southbound between the continental United States and Puerto Rico.

Inland rate increases also apply to shipments moving between either Canada or Mexico and Puerto Rico via the Continental United States.

Increases will be as follows:

Dry Rates:

• Rates for Dry container shipments moving Port-to-Port will increase by 9%.

• Rates for Dry shipments with an inland component will increase by 9%.

Port-to-Port Reefer Rates:

• Rates for Refrigerated Containers moving Port-to-Port over Jacksonville will increase by 7%.

• Rates for Refrigerated Containers moving Port-to-Port over Elizabeth or Houston will also

increase by 7% and be at least $125 USD above the new Jacksonville Port-to-Port Reefer rate.

Inland Reefer Rates:

• Rates for Refrigerated Containers with an inland component moving over all ports

(Jacksonville, Elizabeth, and Houston) will all increase by 7%.

• Rates for Refrigerated Containers with an inland component moving over Jacksonville from

South Florida will increase to a level $200 USD above the new Jacksonville Reefer Rate to cover some of the additional inland expense.

If you have any questions, please contact your Horizon Lines Sales representative or Customer Service, 1-877-678-7447. Thank you for choosing Horizon Lines.

Customers may access their shipment information via the NetCaptain 24 hours-a-day, 7 days-a-week at www.horizonlines.com