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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.    )

Filed by the Registrant  

Filed by a Party other than the Registrant  

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a-12

Matson, Inc.

(Name of Registrant as Specified In Its Charter)

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

Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1)

Title of each class of securities to which transaction applies:

(2)

Aggregate number of securities to which transaction applies:

(3)

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)

Proposed maximum aggregate value of transaction:

(5)

Total fee paid:

Fee paid previously with preliminary materials.

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

(1)

Amount Previously Paid:

(2)

Form, Schedule or Registration Statement No.:

(3)

Filing Party:

(4)

Date Filed:


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Matson, Inc.

1411 Sand Island Parkway, Honolulu, Hawaii 96819

March 9, 2021

To the Shareholders of Matson, Inc.:

You are invited to attend the 2021 Annual Meeting of Shareholders of Matson, Inc. (“Matson” or the “Company”), to be held online via live webcast on Thursday, April 22, 2021 at 8:30 a.m., Hawaii Standard Time.

We have elected to provide access to our proxy materials over the internet under the Securities and Exchange Commission’s “notice and access” rules. On or around March 9, 2021, we expect to distribute to our shareholders either (i) a copy of our Proxy Statement, the accompanying proxy card and our annual report or (ii) the Notice of Internet Availability of Proxy Materials (the “Notice”) only. The Notice contains instructions for how to access our Proxy Statement and annual report over the Internet and how to request a paper copy of the Proxy Statement and annual report.

Your vote is important – no matter how many or how few shares you may own. Whether or not you plan to attend the virtual Annual Meeting, please read the Proxy Statement and vote as soon as possible. You may vote via the Internet or, if you receive printed proxy materials, by telephone or by mailing a proxy card. Instructions for Internet and telephone voting are included in your proxy card and the Proxy Statement (if you receive your materials by mail). Any shareholder attending the virtual Annual Meeting may vote at the meeting even if a proxy has been returned.

Thank you for your continued support of Matson.

Sincerely,

/s/ Matthew J. Cox

MATTHEW J. COX

Chairman and Chief Executive Officer


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Matson, Inc.

1411 Sand Island Parkway, Honolulu, Hawaii 96819

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

The Annual Meeting of Shareholders of Matson, Inc. will be held online via live webcast on Thursday, April 22, 2021 at 8:30 a.m., Hawaii Standard Time, to:

1.Elect the seven directors named in the proxy statement to serve until the next Annual Meeting of Shareholders and until their successors are duly elected and qualified;
2.Approve, on an advisory basis, executive compensation;
3.Approve the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan;
4.Ratify the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the year ending December 31, 2021; and
5.Transact such other business as properly may be brought before the meeting or any adjournment or postponement thereof.

To participate in the virtual meeting, you must go to www.virtualshareholdermeeting.com/MATX2021 and enter the control number provided on the proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials. During the meeting, shareholders may vote, ask questions and view the list of registered shareholders as of the record date by following the instructions available on the meeting website.

The Board of Directors has set the close of business on February 26, 2021 as the record date for the meeting. Owners of Matson, Inc. stock at the close of business on that date are entitled to receive notice of and to vote at the meeting.


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IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. WHETHER OR NOT YOU PLAN TO ATTEND THE VIRTUAL MEETING, PLEASE PROMPTLY VOTE VIA THE INTERNET OR IF YOU RECEIVE PRINTED PROXY MATERIALS, BY TELEPHONE OR BY MAILING THE PROXY CARD.

By Order of the Board of Directors,

/s/ Rachel C. Lee

RACHEL C. LEE

Vice President and Corporate Secretary

March 9, 2021

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE SHAREHOLDER MEETING TO BE HELD ON APRIL 22, 2021

The Notice of Annual Meeting of Shareholders, Proxy Statement and the

Annual Report to Shareholders are available at www.proxyvote.com.


SUMMARY INFORMATION

This summary highlights information contained elsewhere in this Proxy Statement. For more complete information, we encourage you to review the entire Proxy Statement and Matson’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

Annual Meeting of Shareholders

·

Date and Time:

April 22, 2021 at 8:30 a.m. (HST)

·

Place:

On-line only, at www.virtualshareholdermeeting.com/MATX2021

·

Record Date:

February 26, 2021

·

Attendance:

All shareholders may attend the virtual meeting online and listen to the webcast. You will need the 16-digit control number provided on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials.

·

Voting:

Shareholders as of the record date are entitled to vote. Each share of common stock is entitled to one vote for each director nominee and each of the other proposals. You will need the 16-digit control number provided on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials.

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Vote at
www.proxyvote.com

Vote by Calling
1-800-690-6903

Vote by Mail

Vote Online at Virtual Meeting

Meeting Agenda and Voting Recommendations

Agenda Item

Board
Recommendation

Page

Election of seven directors

FOR

7

Advisory approval of our executive compensation

FOR

52

Approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan

FOR

54

Ratification of selection of Deloitte & Touche LLP (“Deloitte”) as our independent auditors

FOR

70

Director Nominees

We are asking you to vote “FOR” all of the director nominees listed below. Set forth below is summary information about each director nominee.

Nominee and Principal Occupation

Age

Director
Since

Independent

Leadership/Committees

Matthew J. Cox, Chairman and Chief Executive Officer of Matson, Inc.

59

2012

·

Chairman of the Board

Stanley M. Kuriyama, former Chairman of Alexander & Baldwin, Inc.

67

2016

·

Lead Independent Director

·

Compensation

·

Nominating (Chair)


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Nominee and Principal Occupation

Age

Director
Since

Independent

Leadership/Committees

Meredith J. Ching, Executive Vice President, External Affairs of Alexander & Baldwin, Inc.

64

2020

·

Compensation

Admiral Thomas B. Fargo, U.S. Navy (Ret.), former Commander of the U.S. Pacific Command

72

2011

·

Audit

Mark H. Fukunaga, Chairman and Chief Executive Officer of Servco Pacific Inc.

65

2018

·

Compensation (Chair)

·

Nominating

Constance H. Lau, President and Chief Executive Officer of Hawaiian Electric Industries, Inc.

68

2004

·

Audit (Chair)

·

Nominating

Jenai S. Wall, Chairman and Chief Executive Officer of Foodland Super Market, Ltd.

62

2019

·

Audit

·

Nominating

Corporate Governance Highlights

86% of Board is independent (6 of 7 directors)

Commitment to Board diversity

43% of director nominees are women (50% of independent directors) and 71% self-identify as racially or ethnically diverse

Balanced mix of director tenures, with average of 6.7 years

Average board age of 65 years

Annual election of all directors

Plurality plus vote for directors

Board oversight of risk management

Annual shareholder engagement program

Lead Independent Director

Board oversight of succession planning for directors, CEO and senior management

Annual Board and committee self-evaluations

Executive sessions of independent directors

Continuing director education

Strong executive and director stock ownership guidelines

No supermajority voting requirements

Board oversight of sustainability initiatives and political spending

Mandatory retirement age for directors

For more information, please see “Corporate Governance” and “Proposal 1 – Election of Directors” in this Proxy Statement.

Impact of COVID-19 Pandemic on Pay

Beginning May 1, 2020, as part of the Company’s response plan to the economic effects of the COVID-19 pandemic, the Company implemented salary reductions for the executive officers. The Chairman and Chief Executive Officer’s base salary was reduced by 30% and the other NEO’s base salaries were reduced by 20% from May 1 through November 30, 2020. The Board of Directors also reduced its cash retainers and meeting fees by 30% from May 1 through November 30, 2020. The Company did not make any adjustments to performance measures, payout opportunities or plan mechanics under the incentive compensation plans.

Executive Compensation

We are asking you to vote “FOR”, on an advisory basis, our executive compensation. Matson’s compensation philosophy is to align the Company’s objectives with shareholder interests through a compensation program that attracts, motivates and retains talented executives, and rewards outstanding performance. In 2020, 80% of Mr. Cox’s and approximately 70% of the other NEO’s target total direct compensation were variable and at-risk based on annual and long-term performance.

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CEO Target Total Direct Compensation

Other NEO Target Total Direct Compensation

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At the 2020 Annual Meeting of Shareholders, our executive compensation program received strong support from shareholders with over 97% voting FOR our say on pay proposal.

Other Compensation Practices

Promote Good Pay Practices

    

Discourage Bad Pay Practices

Change in control agreements that include double triggers requiring both a change in control event and termination of employment before any severance payments can be made

Pay packages for the CEO and NEOs that are in line with the Companys peer group

Different financial, operating and stock price performance metrics to determine incentive payments in annual and long-term incentive awards

Vesting of 50% of annual equity award is tied to achievement of specified performance goals, including relative TSR

Minimum vesting periods of three years on all equity awards to senior executives

No-fault clawback policy that applies to all senior management

Policy prohibiting hedging and other speculative transactions involving Company stock by employees, officers and directors

No employment contracts with any executive officer

No guaranteed bonus payments to executive officers

No bonus payouts that are not tied to performance

No single trigger vesting of equity in change of control

No pension payouts that are not proportional to pension payouts to employees generally

No excessive perquisites

No excessive severance or change in control provisions

No tax reimbursements or gross-ups

No dividends or dividend equivalents paid on unvested Performance Shares

No unreasonable internal pay disparity

No re-pricing or replacing of underwater stock options, without prior shareholder approval

No above-market interest on deferred compensation plans

For more information, please see “Executive Compensation” and “Proposal 2 – Advisory Vote to Approve Executive Compensation” in this Proxy Statement.

Amended and Restated Matson, Inc. 2016 Incentive Stock Plan

We are asking you to vote FOR the addition of 1,850,000 shares to the Amended and Restated Matson, Inc. 2016 Incentive Stock Plan (the Amended 2016 Plan), for a total of 4,350,000 shares, reduced by the number of shares already issued under awards previously granted under the plan. This increase, if approved, would result in a total of 2,460,652 shares being available for issuance under the Amended 2016 Plan, which represents 5.7% of Matsons outstanding common stock. No other material changes have been made in Amended 2016 Plan. For more information, please see Proposal 3 –

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Approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan” in this Proxy Statement.

Auditors

As a matter of good corporate governance, we are asking you to vote “FOR” the ratification of the appointment of Deloitte as our independent auditors for the fiscal year ending December 31, 2021. Following a robust evaluation process that considered the qualifications, independence and performance of Deloitte, the Audit Committee believes that Deloitte is independent and that it is in the best interests of Matson and our shareholders for Deloitte to serve as our independent auditors. The following table summarizes the fees Deloitte billed to us for professional services for 2020 and 2019. The Audit Committee pre-approved all such services.

Fiscal Year

Audit Fees
($)

Audit-Related Fees
($)

Tax Fees
($)

All Other Fees
($)

2020

2,345,000

20,000

129,000

0

2019

2,400,000

20,000

75,000

0

For more information, please see “Proposal 4 – Ratification of Appointment of Independent Registered Public Accounting Firm” in this Proxy Statement.

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING

    

1

PROPOSAL 1 — ELECTION OF DIRECTORS

7

CORPORATE GOVERNANCE

12

Director Independence

12

Board Leadership Structure

12

Board Evaluations

13

The Board’s Role in Risk Oversight

13

Pay Risk Assessment

13

Board of Directors and Committees of the Board

14

Director Nomination Processes

15

Corporate Governance Guidelines

16

Sustainability

16

Compensation of Directors

17

Director Stock Ownership Guidelines

18

Shareholder Engagement

18

Communications with Directors

18

SECURITY OWNERSHIP OF CERTAIN SHAREHOLDERS

18

CERTAIN INFORMATION REGARDING DIRECTORS AND EXECUTIVE OFFICERS

20

Security Ownership of Directors and Executive Officers

20

Delinquent Section 16(a) Reports

20

Certain Relationships and Transactions

21

Code of Ethics

22

Code of Conduct

22

Executive Officers

22

EXECUTIVE COMPENSATION

24

Compensation Discussion and Analysis

24

Compensation Committee Report

38

Compensation Committee Interlocks and Insider Participation

38

Summary Compensation Table

39

Grants of Plan-Based Awards

39

Outstanding Equity Awards at Fiscal Year End

42

Option Exercises and Stock Vested

43

Pension Benefits

43

Non-Qualified Deferred Compensation

45

Other Potential Post-Employment Payments

46

PROPOSAL 2 – ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

52

PROPOSAL 3 – APPROVAL OF THE AMENDED AND RESTATED MATSON, INC. 2016 INCENTIVE COMPENSATION PLAN

54

AUDIT COMMITTEE REPORT

69

PROPOSAL 4 – RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

70

OTHER BUSINESS

71

SHAREHOLDER PROPOSALS AND NOMINATIONS FOR 2022

71

SHAREHOLDERS WITH THE SAME ADDRESS

72

COPIES OF ANNUAL REPORT ON FORM 10-K

72


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Matson, Inc.

1411 Sand Island Parkway, Honolulu, Hawaii 96819

PROXY STATEMENT

Annual Meeting of Shareholders

Thursday, April 22, 2021

The Board of Directors (the “Board of Directors” or the “Board”) of Matson, Inc. (“Matson” or the “Company”) is soliciting your proxy to vote at the 2021 Annual Meeting of Shareholders to be held on Thursday, April 22, 2021 at 8:30 a.m., Hawaii Standard Time, and any adjournment or postponement of that meeting (the “Annual Meeting”). The Annual Meeting will be held online via live webcast at www.virtualshareholdermeeting.com/MATX2021. This Proxy Statement and the accompanying proxy card and Notice of Annual Meeting of Shareholders were first mailed or otherwise made available, on or about March 9, 2021, to shareholders of record as of February 26, 2021, the record date for the Annual Meeting.

In accordance with rules and regulations adopted by the U.S. Securities and Exchange Commission (“SEC”), instead of mailing a printed copy of our proxy materials to each shareholder of record, we are furnishing proxy materials primarily on the Internet. On or around March 9, 2021, we mailed to our shareholders (other than to certain registered holders, certain street name shareholders, or those who previously requested electronic or paper delivery) a Notice of Internet Availability of Proxy Materials, which contains instructions as to how you may access and review on the Internet all of our proxy materials, including this Proxy Statement and our annual report. The Notice of Internet Availability of Proxy Materials also instructs you as to how you may vote your proxy on the Internet. If you would prefer to receive printed proxy materials, please follow the instructions for requesting printed materials contained in the Notice of Internet Availability of Proxy Materials. This process is designed to expedite shareholders’ receipt of proxy materials, lower the cost of the Annual Meeting and help conserve natural resources.

A Note Regarding Websites and Hyperlinks

Websites provided throughout this document are provided for convenience only, and the content on the referenced websites does not constitute a part of this Proxy Statement and is not incorporated herein by reference.

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING

Who may attend the Annual Meeting?

All shareholders as of the record date, February 26, 2021, are invited to attend the Annual Meeting.


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Why is the Annual Meeting being held online via live webcast?

The Board of Directors has decided that the Annual Meeting should be held online this year via live webcast in light of the continued impacts of and risks related to COVID-19 and potential limitations on large gatherings in Honolulu, Hawaii in order to permit shareholders from any location with access to the Internet to participate. The Company has endeavored to provide shareholders with the same rights and opportunities for participation in the Annual Meeting online as an in-person meeting.

How can I attend the Annual Meeting online?

To attend online and participate in the Annual Meeting, you will need the 16-digit control number provided on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials to log into www.virtualshareholdermeeting.com/MATX2021. If you are a beneficial shareholder, you may contact the bank, broker, trust or other nominee or custodian where you hold your shares if you have questions about obtaining your control number.

We encourage you to access the meeting prior to the start time. Please allow ample time for online check-in, which will begin at 8:00 a.m. Hawaii Standard Time. We will have technicians ready to assist you with any difficulties you may have accessing the virtual meeting. If you encounter any difficulties accessing the virtual meeting during the check-in or course of the annual meeting, please call the technical support number that will be posted on the virtual meeting log-in page.

How may I submit questions at the Annual Meeting?

Shareholders may submit questions live during the meeting at the virtual meeting website. We plan to answer as many questions as possible during the time permitted. More information regarding the question and answer process, including the number and types of questions permitted, the time allotted for questions, and how questions will be recognized and answered will be available in the meeting Rules of Conduct, which will be posted on the virtual meeting website before and during the meeting.

Who is entitled to vote at the Annual Meeting?

You are entitled to receive notice of, and to vote at, the Annual Meeting if you own shares of Matson common stock at the close of business on February 26, 2021, the record date for the Annual Meeting. At the close of business on the record date, there were 43,435,170 shares of Matson common stock issued and outstanding. Each share of common stock is entitled to one vote for each director nominee and each of the other proposals to be voted on at the Annual Meeting.

What matters will be voted on at the Annual Meeting and what are the Board’s voting recommendations?

There are four proposals scheduled to be considered and voted on at the Annual Meeting:

Election of seven directors;
Advisory vote to approve executive compensation;
Approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan; and

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Ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2021.

The Board recommends that you vote “FOR” each of the director nominees and “FOR” each of the other proposals.

How do I vote by proxy before the Annual Meeting?

If you are a shareholder of record, you may submit a proxy via the Internet, by telephone or by mail.

Submitting a Proxy via the Internet: You can submit a proxy via the Internet until 11:59 p.m. Eastern Daylight Time (5:59 p.m. Hawaii Standard Time), on April 21, 2021, by accessing www.proxyvote.com and following the instructions you will find on the website. You will need the control number provided on your proxy card or Notice of Internet Availability of Proxy Materials. Internet proxy submission is available 24 hours a day. You will be given the opportunity to confirm that your instructions have been properly recorded.
Submitting a Proxy by Telephone: You can submit a proxy for your shares by telephone until 11:59 p.m. Eastern Daylight Time (5:59 p.m. Hawaii Standard Time), on April 21, 2021, by calling 1-800-690-6903. Telephone proxy submission is available 24 hours a day. Easy-to-follow voice prompts allow you to submit a proxy for your shares and confirm that your instructions have been properly recorded. You will need the control number provided on your proxy card.
Submitting a Proxy by Mail: If you choose to submit a proxy by mail, simply mark your proxy card, date and sign it, and return it in the postage paid envelope provided with the proxy card to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, New York 11717.

By casting your vote in any of the ways listed above, you are authorizing the individuals listed on the proxy to vote your shares in accordance with your instructions. You may also attend the Annual Meeting online and vote your shares.

If you are a “street name” holder, you must provide instructions on voting to your broker, bank, trust or other nominee or custodian holder.

What is the difference between a “shareholder of record” and a “street name” holder?

These terms describe how your shares are held. If your shares are registered directly in your name with our independent transfer agent and registrar, Computershare Shareowner Services LLC, you are a “shareholder of record”. If your shares are held in the name of a brokerage, bank, trust or other nominee as a custodian, you are a “street name” holder and you are considered the “beneficial owner” of the shares. As the beneficial owner of shares, you have the right to direct your broker, bank, trustee or nominee or custodian how to vote your shares, and you will receive separate instructions from them describing how to vote your shares.

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How many proxy cards might I receive?

You could receive multiple proxy cards if you hold your shares in different ways (e.g., joint tenancy, trusts and custodial accounts) or in multiple accounts. If your shares are held in “street name”, you will receive your proxy card or other voting information from your broker, bank, trustee or other nominee or custodian, and you will return your proxy card or cards to them. You should complete and sign, or provide Internet or telephone voting instructions with respect to, each proxy card you receive.

Can I vote my shares during the Annual Meeting?

Yes. If you decide to join us on-line at the virtual Annual Meeting, you may vote your shares during the Annual Meeting by following the instructions at www.virtualshareholdermeeting.com/MATX2021.

Can I revoke my proxy or change my vote after I have submitted a proxy?

You may revoke your proxy or change your vote at any time before it is exercised by:

delivering to the Corporate Secretary a written notice of revocation, dated later than the proxy, before the vote is taken at the Annual Meeting;
delivering to the Corporate Secretary an executed proxy bearing a later date, before the vote is taken at the Annual Meeting;
submitting a proxy on a later date via the Internet or by telephone (only your last Internet or telephone proxy will be counted), before 11:59 p.m. Eastern Daylight Time (5:59 p.m. Hawaii Standard Time), on April 21, 2021; or
attending the Annual Meeting online and voting during the meeting (your attendance at the Annual Meeting, in and of itself, will not revoke the proxy).

Any written notice of revocation, or later dated proxy, should be delivered to:

Rachel C. Lee

Corporate Secretary

Matson, Inc.

555 12th Street

Oakland, California 94607

(510) 628-4000

If your shares are held by a broker, bank, trustee or other nominee or custodian, you must follow the instructions provided by them if you wish to revoke your proxy or change your vote.

What constitutes a quorum for the Annual Meeting?

In order to take action on the proposals at the Annual Meeting, a quorum, consisting of a majority of the outstanding shares entitled to vote as of the record date, must be represented at the meeting. Abstentions and broker non-votes will be counted as shares that are present for purposes of determining quorum.

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What are the voting requirements for each of the proposals?

Provided a quorum is present:

Proposal 1 – Election of directors: Directors will be elected by a plurality of the votes cast by the shares entitled to vote in the election of directors. A “plurality” voting standard means that the seven nominees who receive the most “for” votes cast will be elected as directors.

Proposal 2 – Advisory vote to approve executive compensation: The affirmative vote of a majority of the votes cast at the Annual Meeting is required to approve this proposal.

Proposal 3 — Approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan: The affirmative vote of a majority of the votes cast at the Annual Meeting is required to approve this proposal.

Proposal 4 – Ratification of the appointment of Deloitte and Touche LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021: The affirmative vote of a majority of the votes cast at the Annual Meeting is required to approve this proposal.

What is a broker “non-vote”?

A broker “non-vote” occurs when a broker or other nominee who holds shares for a beneficial owner is unable to vote those shares for the beneficial owner because the broker or other nominee does not have discretionary voting power for the proposal and has not received voting instructions from the beneficial owner of the shares. Brokers will have discretionary voting power to vote shares for which no voting instructions have been provided by the beneficial owner only with respect to the proposal to ratify the appointment of the Company’s independent registered public accounting firm. Brokers will not have such discretionary voting power to vote shares with respect to the election of directors, the advisory vote to approve executive compensation, or the approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan.

How will abstentions and broker non-votes affect the votes?

Abstentions and broker non-votes will generally have no effect on the voting results for any proposal, as they are not considered to be votes cast under Hawaii corporate law. However, for purposes of Proposal 3, approval of the Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan, New York Stock Exchange (“NYSE”) rules require abstentions to be counted as votes cast and, therefore, they will have the same effect as a vote “against” the proposal.

How will my shares be voted if I give my proxy but do not specify how my shares should be voted?

If you provide specific voting instructions, your shares will be voted at the Annual Meeting in accordance with your instructions. If you hold shares in your name (i.e., you are a shareholder of record and not a street-name holder) and sign and return a proxy card without giving specific voting instructions, your shares will be voted “FOR” each of the director nominees named in this Proxy Statement and “FOR” Proposals 2, 3 and 4, in accordance with the Board’s recommendations.

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Who will count the votes?

At the Annual Meeting, votes will be counted by an election inspector from the Company. Such inspector will participate in the Annual Meeting to process and count the votes cast by our shareholders, make a report of inspection and certify as to the number of votes cast on each proposal.

Who will conduct the proxy solicitation and how much will it cost?

We are soliciting proxies from shareholders on behalf of our Board and will pay for all costs incurred by it in connection with the solicitation. In addition to solicitation by mail, the directors, officers and employees of Matson and its subsidiaries may solicit proxies from shareholders in person or by telephone, videoconference, facsimile or email without additional compensation other than reimbursement for their actual expenses.

We have retained Alliance Advisors, a proxy solicitation firm, to assist us in the solicitation of proxies for the Annual Meeting. We will pay Alliance Advisors a fee of approximately $6,000 and reimburse the firm for its reasonable out-of-pocket expenses.

Arrangements also will be made with brokerage firms and other custodians, nominees and fiduciaries for the forwarding of solicitation material to the beneficial owners of stock held of record by such persons, and we will reimburse such custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses in connection with these forwarding services.

Where can I find the voting results of the Annual Meeting?

We will announce preliminary voting results at the Annual Meeting and expect to publish final results on a Form 8-K filed with the SEC within four business days after the Annual Meeting.

If you have any questions about voting your shares or attending the Annual Meeting, please call our Corporate Secretary at (510) 628-4000 or Alliance Advisors toll free at (855) 723-7816.

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PROPOSAL 1 — ELECTION OF DIRECTORS

The number of directors is currently fixed at seven. Each Director nominee was previously elected by shareholders at last year’s Annual Meeting. If elected, each Director nominee will serve until the next Annual Meeting of Shareholders and until his or her successor is duly elected and qualified.

Director Nominees and Qualification of Directors

The nominees of the Board of Directors are the seven persons named below. The Board of Directors believes that all nominees will be able and willing to serve. However, if any nominee should decline or become unable to serve for any reason, the proxy holder will vote your shares to approve the election of any replacement nominee proposed by the Board of Directors or just for the remaining nominees, leaving a vacancy. Alternatively, the Board of Directors may reduce the size of the Board.

Our Board members have a diverse range of perspectives and are knowledgeable about our businesses and operating markets. Each director contributes in establishing a Board climate of trust and respect, where deliberations are open and constructive. All of our Board members are U.S. citizens which helps the Company remain in compliance with the requirements of the Merchant Marine Act of 1920, commonly referred to as the Jones Act. In selecting nominees, the Board has considered these factors and has reviewed the qualifications of each nominee, which includes the factors reflected below:

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* This skills matrix represents the diverse skillsets of our seven directors being proposed for re-election. The fact that a particular skill or qualification is not designated does not mean the director does not possess that particular attribute.

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The following table provides the name, age (as of March 9, 2021) and principal occupation of each person nominated by the Board of Directors, their business experience during at least the last five years, the year each was first elected or appointed a director (including to predecessor companies), other public company board directorships, and the skills, qualifications and attributes of each director that led to the conclusion he or she should serve as a director, in light of Matson’s current business and structure.

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Matthew J. Cox
Age: 59
Chairman and CEO

Director Since: 2012

Chairman of the Board of Matson since April 2017 and Chief Executive Officer since June 2012;
President of Matson from June 2012 to April 2017;
Chairman and CEO of Matson’s subsidiary, Matson Navigation Company, Inc. (“MatNav”) since June 2012;
President of MatNav from October 2008 to April 2017;
Variety of positions, including Vice President, Refrigerated Containers, at American President Lines (“APL”) (global container transportation company) from 1987 to 1999; and
Director of First Hawaiian, Inc. (Nasdaq:FHB) (bank holding company) (“First Hawaiian”) since 2016.

Director Qualifications

As a member of Matson’s senior management team for over 19 years and with more than 33 years of transportation and logistics experience, Mr. Cox brings to the Board an in-depth knowledge of all aspects of the Company’s operations, and is knowledgeable about Matson’s operating markets through his Matson, APL and other experience and his involvement in the Hawaii business community and local community organizations.

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Graphic

Stanley M. Kuriyama
Age: 67
Lead Independent Director and Chair of the Nominating and Corporate Governance Committee

Director Since: 2016

Chairman of Alexander & Baldwin, Inc., Honolulu, Hawaii (NYSE:ALEX) (real estate investment trust) (“A&B”) from June 2012 to September 2020; and
Chief Executive Officer of A&B from January 2010 to December 2015; Director of A&B from January 2010 through June 2012; and executive Chairman of A&B from January 2016 to December 2016.

Director Qualifications

As the former Chairman and Chief Executive Officer of A&B, Mr. Kuriyama brings to the Board an in-depth knowledge of Hawaii and Matson’s operating markets. From September 2009 to June 2012, he also served as a Director and Chairman of the Board of the Company’s subsidiary, Matson Navigation Company, Inc., prior to the Company’s separation from A&B, and is knowledgeable about all aspects of the Company’s operations. Mr. Kuriyama also has extensive involvement in the Hawaii business community and local community organizations.

Graphic

Meredith J. Ching
Age: 64
Director Since: 2020

Executive Vice President, External Affairs of A&B since March 2018;
Senior Vice President, Government & Community Relations of A&B from June 2007 to March 2018; and
Director of Cincinnati Bell Inc.1 (NYSE:CBB) (telecommunications provider) (“Cincinnati Bell”) since July 2018 and former director of Hawaiian Telcom Holdco, Inc. from May 2015 to June 2018.

Director Qualifications

As Executive Vice President of External Affairs at A&B and through her extensive involvement in the Hawaii business community and local community organizations, Ms. Ching brings to the Board deep understanding about Hawaii and Matson’s operating markets. She also has public company board experience via her service on the boards of Hawaiian Telcom and Cincinnati Bell Inc.


As disclosed in filings with the SEC, Cincinnati Bell has entered into an Agreement and Plan of Merger pursuant to which Cincinnati Bell will be acquired by an affiliate of Macquarie Infrastructure Partners V, a fund managed by Macquarie Infrastructure and Real Assets. The merger is expected to close in the first half of 2021 and at the effective time of the merger, Cincinnati Bell will cease to be a publicly-traded company.

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Graphic

Thomas B. Fargo
Age: 72
Director Since: 2011

Chairman of the Board of Hawaiian Electric Industries, Inc., Honolulu, Hawaii (NYSE:HE) (electric utility/banking) (“HEI”) since May 2020 and a director since March 2005;
Commander, U.S. Pacific Command, from May 2002 to March 2005;
John M. Shalikasvili Chair in National Security Studies at the National Bureau of Asian Research from 2010 to March 2016;
Owner of Fargo Associates, LLC (defense and homeland/national security consultancy) since 2005;
Lead Director of The Greenbrier Companies, Inc. (NYSE:GBX) (transportation equipment and services) since January 2021 and a director since July 2015; and
Non-Executive Chairman of the Board, Huntington Ingalls Industries, Inc., Newport News, Virginia (NYSE:HII) (military shipbuilder) from March 2011 to April 2020; and director of Hawaiian Electric Company, Inc. (“HECO”), a subsidiary of HEI, from March 2005 to January 2017.

Director Qualifications

Through his various executive and leadership roles, Admiral Fargo brings to the Board experience in maritime and military operations and in managing complex business organizations. He is knowledgeable about Hawaii and Matson’s operating markets through his involvement in the Hawaii business community and local community organizations. Admiral Fargo also has extensive diplomatic, business and policy experience in Asia. As the senior military commander in East Asia and the Pacific, he was responsible for U.S. security arrangements and engagement with the respective governments of the region.

Graphic

Mark H. Fukunaga
Age: 65

Chair of the Compensation Committee
Director Since: 2018

Chairman and Chief Executive Officer of Servco Pacific Inc., Honolulu, Hawaii (automotive distribution and retailing) (“Servco”) since March 1994.

Director Qualifications

As the Chairman and Chief Executive Officer of Servco, a company with operations in automotive distribution and retailing, musical instruments and e-learning, and investments in venture capital and private equity, Mr. Fukunaga brings to the Board extensive operating experience and leadership skills. He is knowledgeable about Hawaii and Matson’s operating markets through his involvement in the Hawaii business community and local community organizations. In addition, Mr. Fukunaga has extensive business experience in the U.S. Pacific Northwest, Asia and the Pacific Rim.

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Graphic

Constance H. Lau
Age: 68
Chair of the Audit Committee

Director Since: 2004

President, Chief Executive Officer and Director of HEI since May 2006;
Chairman of the Board and Director of American Savings Bank, F.S.B. (“American Savings Bank”), a subsidiary of HEI, since May 2006; and
Director of HECO from May 2006 to May 2019.

Director Qualifications

As President, Chief Executive Officer and director of HEI, the largest publicly-traded corporation in Hawaii, and as Chair of the Board of HEI’s banking subsidiary, Ms. Lau brings to the Board experience with capital intensive infrastructure and regulated industries as well as in managing complex business organizations. She also serves as Chair, National Infrastructure Advisory Council, which advises the President of the United States on the security of critical infrastructure sectors, including transportation, and their information systems. In addition, Ms. Lau has extensive experience in the banking industry and has been designated by the Board of Directors as an Audit Committee Financial Expert. She also is knowledgeable about Hawaii and Matson’s operating markets through her involvement in the Hawaii business community and local community organizations.

Graphic

Jenai S. Wall
Age: 62
Director Since: 2019

Chairman and Chief Executive Officer of Foodland Super Market, Ltd. (grocery retailer) (“Foodland”), Food Pantry, Ltd., Kalama Beach Corporation and Pacific Warehouse, Inc., Honolulu, Hawaii since 1998;
Director of First Hawaiian since August 2018; and
Director of A&B from April 2015 to April 2019.

Director Qualifications

As Chairman and Chief Executive Officer of Foodland, the largest locally-owned grocery retailer in Hawaii, and other entities in the Sullivan Family of Companies, Ms. Wall brings to the Board experience in managing complex business organizations and real-time logistics expertise. She is knowledgeable about Hawaii and Matson’s operating markets through her involvement in the Hawaii business community and local community organizations. She also has public company board experience via her service on the board of First Hawaiian.

The Board of Directors recommends that shareholders vote “FOR”

each of the seven nominees for director.

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CORPORATE GOVERNANCE

Director Independence

The NYSE listing standards and our Corporate Governance Guidelines require that a majority of our Board of Directors, including every member of the Audit, Compensation and Nominating and Corporate Governance Committees be “independent” and that committee members satisfy heighted independence standards, as applicable. The Board has reviewed each of its current directors and has determined that all of such individuals, with the exception of Mr. Cox, who is an executive officer of Matson, are independent under NYSE rules. The Board had also previously determined that W. Blake Baird, who did not stand for re-election to the Board in April 2020, was independent under NYSE rules. In making its independence determinations, the Board considered the transactions, relationships or arrangements described below in “Certain Information Regarding Directors and Executive Officers—Certain Relationships and Transactions”, as well as the following, none of which the Board deemed to be material to Matson: Admiral Fargo—Matson’s banking relationships with American Savings Bank, the corporate parent of which Admiral Fargo is a director; Mr. Fukunaga—Matson’s commercial relationships with Servco, an entity of which Mr. Fukunaga is chairman and chief executive officer; Ms. Lau—Matson’s banking relationships with American Savings Bank, the corporate parent of which Ms. Lau is president, chief executive officer, and a director; and Ms. Wall—Matson’s commercial relationships with Foodland, an entity of which Ms. Wall is chairman and chief executive officer, and Matson’s banking relationships with First Hawaiian Bank, an entity of which Ms. Wall is a director and the corporate parent of which Ms. Wall is a director.

Board Leadership Structure

The Board recognizes that one of its key responsibilities is to evaluate and determine the optimal leadership structure to best serve the interests of shareholders. The Board understands that there is no single, generally accepted approach to providing Board leadership. Given the dynamic and competitive environment in which we operate, the right Board leadership structure may vary as circumstances warrant.

The Company’s Bylaws and Corporate Governance Guidelines provide the Board flexibility to determine whether it is in the best interests of the Company and its shareholders to have a combined or separate Chairman of the Board and Chief Executive Officer (“CEO”). The Board has combined the Chairman and CEO roles and the independent directors have designated a Lead Independent Director because it provides unified leadership and accountability in quickly and seamlessly identifying and carrying out the strategic priorities of the Company. With its Lead Independent Director, this governance structure also provides a form of leadership that allows the Board to function independently from management and exercise objective judgment regarding management’s performance, and enables the Board to fulfill its duties effectively and efficiently. The Lead Independent Director has significant responsibilities, which are set forth in the Company’s Corporate Governance Guidelines, including:

Consults with the Chairman on agendas and meeting schedules to assure that there is sufficient time for discussion of all agenda items;
Consults with the Chairman on information sent to the Board;
Facilitates the process for the Board’s self-evaluation;
Presides at Board meetings in the absence of the Chairman;
Presides at executive sessions of non-management directors;
Has authority to call meetings of the independent directors;
Serves as liaison between the independent directors and the Chairman and CEO; and

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If appropriate, and in coordination with executive management, be available for consultation and direct communication with major shareholders.

The Board believes that the Company and its shareholders continue to be best served at this time by having Matthew J. Cox serve as the Chairman and CEO, and Stanley M. Kuriyama serve as the Lead Independent Director.

Board Evaluations

Each year, the Nominating and Corporate Governance Committee, together with the Lead Independent Director, oversees an annual Board and committee evaluation process to assess its performance and effectiveness. As part of this process, Board members complete a questionnaire that requests subjective comment in key areas and solicits specific topics on which Directors would like to focus during the upcoming year. The results are discussed by the Board in an executive session at a regularly scheduled Board meeting. Each committee conducts its own self-evaluation and reports the findings of the self-evaluations to the full Board.

The Board’s Role in Risk Oversight

The Board has oversight of the risk management process, which includes overseeing our process for identifying, assessing and mitigating significant financial, operational, legal, strategic, cybersecurity and other risks that may affect the Company, including those related to climate change and human capital management. Risk oversight plays a role in all major Board decisions and the evaluation of risk is a key part of the decision-making process. For example, the identification of risks and the development of sensitivity analyses are key requirements for capital requests that are presented to the Board. The Board administers its oversight role in part through its committees. The Audit Committee’s responsibilities include discussing policies regarding risk assessment and risk management. The Compensation Committee’s responsibilities include assessing risks arising from the Company’s compensation policies and practices. The Nominating and Corporate Governance Committee’s responsibilities include discussing governance-related risks.

This risk management process occurs throughout all levels of the organization, but is also facilitated through a risk management steering committee comprised of senior management, whose members meet regularly to identify and address specific significant risks. Risk management is reflected in the Company’s compliance, auditing and risk management functions, and its risk-based approach to strategic and operating decision-making. Management reviews its risk management activities with the Audit Committee and the full Board of Directors on a regular basis. The Board periodically receives various reports on risk-related matters, including presentations by senior management with an overview of the risk management program and that include risk management perspectives from each of Matson’s business segments in the company-wide strategic plan.

Pay Risk Assessment

In 2020, management worked with the Compensation Committee and Exequity LLP, an independent executive compensation consulting firm retained by the Compensation Committee, to review all Company incentive plans and related policies and practices, and the overall structure of total pay, pay mix, the risk management process and related internal controls.

The Company concluded that the risks arising from our incentive compensation policies and practices are not reasonably likely to have a material adverse effect on the Company.

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Board of Directors and Committees of the Board

The Board of Directors held eight meetings during 2020. In conjunction with four of these meetings, the non-management directors of Matson met in formally-scheduled executive sessions led by the Lead Independent Director. In 2020, all directors attended all of the meetings of the Board of Directors and the Committees of the Board on which they served. In addition, Matson’s directors are strongly encouraged to attend the Annual Meeting of Shareholders. All of the current directors attended the 2020 Annual Meeting.

The Board of Directors has an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee, each of which is governed by a charter, which is available on the corporate governance page of Matson’s website at www.matson.com. Each committee meets regularly throughout the year, reports its actions to the Board, receives reports from senior management, annually evaluates its performance and can retain outside advisors. The composition of each committee is set forth below:

Audit

Compensation

Nominating and
Corporate
Governance

Matthew J. Cox

Constance H. Lau

Chair

Mark H. Fukunaga

Chair

Stanley M. Kuriyama

Chair

Meredith J. Ching

Thomas B. Fargo

Jenai S. Wall

Audit Committee: Each member is an independent director under the applicable NYSE listing standards and SEC rules. In addition, the Board has determined that Ms. Lau is an “Audit Committee Financial Expert” under SEC rules. The duties and responsibilities of the Audit Committee are set forth in a written charter adopted by the Board of Directors, and are summarized in the Audit Committee Report, which appears in this Proxy Statement. The Audit Committee met six times during 2020.

Compensation Committee: Each member is an independent director under the applicable NYSE listing standards and SEC rules. The Compensation Committee has general responsibility for the compensation and benefits of the Company’s executive officers and other salaried employees, including incentive compensation and stock incentive plans, and for making recommendations on director compensation to the Board. The Compensation Committee may form subcommittees and delegate such authority as the Compensation Committee deems appropriate, subject to any restrictions by law or listing standard. For further information on the processes and procedures for consideration of executive compensation, see the “Executive Compensation – Compensation Discussion and Analysis” section of this Proxy Statement. The Compensation Committee met four times during 2020.

Nominating and Corporate Governance Committee: Each member is an independent director under the applicable NYSE listing standards. The functions of the Nominating and Corporate Governance Committee include recommending to the Board individuals qualified to serve as directors; recommending to the Board the size and composition of committees of the Board and monitoring the functioning of the committees; advising on Board composition and procedures; reviewing corporate governance issues; overseeing the annual evaluation of the Board; and ensuring that an evaluation of

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management occurs. The Nominating and Corporate Governance Committee met three times during 2020.

Director Nomination Processes

The Nominating and Corporate Governance Committee identifies potential nominees by asking current directors to notify the Nominating and Corporate Governance Committee of qualified persons who might be available to serve on the Board. From time to time, the Nominating and Corporate Governance Committee also engages firms that specialize in identifying director candidates.

The Nominating and Corporate Governance Committee will consider director candidates recommended by shareholders. In considering such candidates, the Nominating and Corporate Governance Committee will take into consideration the needs of the Board and the qualifications of the candidate. To have a candidate considered by the Nominating and Corporate Governance Committee, a shareholder must submit a written recommendation that meets the requirements of the Company’s Bylaws, including the name of the shareholder, evidence of the shareholder’s ownership of Matson stock (including the number of shares owned and the length of time of ownership), the name of the candidate, the candidate’s qualifications to be a director and the candidate’s consent for such consideration.

The shareholder recommendation and information described above must be sent to the Corporate Secretary at 555 12th Street, Oakland, California 94607.

The Nominating and Corporate Governance Committee believes that the minimum qualifications for serving as a director are high ethical standards, a commitment to shareholders, a genuine interest in Matson and a willingness and ability to devote adequate time to a director’s duties. The Company’s Corporate Governance Guidelines authorize the Nominating and Corporate Governance Committee to consider other factors it deems to be in the best interests of Matson and its shareholders, including whether nominees possess such knowledge, experience, skills, expertise and diversity to enhance the Board’s ability to manage and direct the business and affairs of the Company, including, when applicable, to enhance the ability of committees of the Board to fulfill their duties and/or to satisfy any independence requirements imposed by law, regulation or NYSE rules. While the Nominating and Corporate Governance Committee does not have a separate written diversity policy, it does consider diversity, including diversity of knowledge, skills, professional experience, gender, ethnicity, education, expertise, and representation in industries relevant to the Company, as an important factor in its evaluation of candidates. The Nominating and Corporate Governance Committee reviews annually with the Board the composition of the Board as a whole and recommends any measures to be taken so that the Board reflects the appropriate balance of knowledge, experience, skills and expertise to oversee the Company’s execution of its strategy.

Once a potential candidate has been identified by the Nominating and Corporate Governance Committee, the Nominating and Corporate Governance Committee reviews information regarding the person to determine whether the person should be considered further. If appropriate, the Nominating and Corporate Governance Committee may request information from the candidate, review the person’s accomplishments, qualifications and references, and conduct interviews with the candidate. The Nominating and Corporate Governance Committee’s evaluation process does not vary based on whether or not a candidate is recommended by a shareholder.

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Corporate Governance Guidelines

The Board of Directors has adopted Corporate Governance Guidelines to assist the Board in the exercise of its responsibilities and to promote the effective functioning of the Board and its committees. The guidelines provide details on matters such as:

Goals and responsibilities of the Board;
Selection of directors, including the Chairman of the Board and the Lead Independent Director;
Board membership criteria and director retirement age;
Stock ownership guidelines;
Director independence and executive sessions of non-management directors;
Oversight of sustainability matters;
Board self-evaluation;
Board compensation;
Board access to management and outside advisors;
Board orientation and continuing education; and
Leadership development, including annual evaluations of the CEO and management succession plans.

“Plurality Plus” Policy. Our Corporate Governance Guidelines provide that any director nominee who receives a greater number of “withhold” votes than “for” votes in an uncontested election is required to tender his or her resignation for consideration by the Nominating and Corporate Governance Committee of the Board. The Nominating and Corporate Governance Committee will consider the resignation offer and recommend to the Board whether to accept or reject the resignation offer, or whether other action should be taken. The Board will consider the recommendation of the Nominating and Corporate Governance Committee and will determine whether or not to accept the resignation offer. Full details of this policy are set forth in our Corporate Governance Guidelines, which are available on the corporate governance page of Matson’s corporate website at www.matson.com.

Sustainability

Matson’s core values include being an industry leader in environmental stewardship, contributing positively to the communities in which we live and work, and conducting our business with integrity and accountability.

Our Corporate Governance Guidelines provide that as part of our commitment to sustainability, the Board, with the assistance of the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee, is responsible for overseeing sustainability matters relevant to the Company’s business, including environmental, social and governance matters. The Board receives regular updates on our progress.

In 2020, the Company conducted a materiality assessment to identify environmental, governance and social (“ESG”) issues material to our business and our stakeholders. The assessment identified 16 material ESG issues, including greenhouse gas emissions and climate change; diversity, equity and inclusion; and safe and resilient operations. After completing the ESG materiality assessment, we developed a strategic roadmap to guide our sustainability journey with the goals to move toward a low-carbon future and safeguard our ocean environment; be a vital community partner and employer in support of people’s livelihoods, opportunities and wellbeing; and operate our business safely, ethically and reliably, delivering value to our stakeholders.

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In February 2021, Matson published its inaugural Sustainability Report. The report provides a comprehensive overview of the measures we are taking to promote responsible, sustainable and ethical operations and the progress we have made to advance our sustainability strategy and goals. For more information about the report and our sustainability initiatives, please see our website at www.matson.com/sustainability.

Compensation of Directors

The following table summarizes the compensation paid by Matson to non-employee directors for services rendered during 2020:

2020 DIRECTOR COMPENSATION

Name

    

Fees Earned
or Paid in Cash
($)

    

Stock Awards
($)(1)(2)

    

All Other
Compensation
($)(3)

    

Total
($)

(a)

(b)

(c)

(g)

(h)

W. Blake Baird

30,500 

− 

2,286 

32,786 

Meredith J. Ching

44,563 

100,027 

− 

144,590 

Thomas B. Fargo

66,225 

100,027 

8,429 

174,681 

Mark H. Fukunaga

72,813 

100,027 

− 

172,840 

Stanley M. Kuriyama

100,300 

100,027 

5,271 

205,598 

Constance H. Lau

79,425 

100,027 

2,286 

181,738 

Jenai S. Wall

69,938 

100,027 

2,286 

172,251 


(1)Represents the grant date fair value of restricted stock units granted in 2020. Each director other than Mr. Baird was granted approximately $100,000 in restricted stock units. At the end of 2020, Mmes. Ching, Lau and Wall each had 3,664 restricted stock units; Admiral Fargo and Mr. Fukunaga had 6,291 restricted stock units; Mr. Kuriyama had 10,180 restricted stock units; and Mr. Baird had 0 restricted stock units.
(2)Options have not been granted to directors since 2007. No non-employee directors had any stock option awards outstanding at the end of 2020.
(3)Represents dividend equivalent amounts payable upon vesting of restricted stock units.

Generally, non-employee directors receive cash retainers as follows, all of which are pro-rated and paid quarterly2:

Annual cash retainer:

$

70,000 

Additional annual cash retainer for Lead Independent Director:

$

30,000 

Additional annual cash retainers for committee service:

    

Chair

    

Member

Audit Committee

$

19,000 

$

9,000 

Compensation Committee

$

12,500 

$

7,500 

Nominating and Corporate Governance Committee

$

11,000 

$

6,000 


In light of the COVID-19 pandemic, the Board reduced its cash retainers and meeting fees by 30%, consistent with the salary reduction for the Chairman and Chief Executive Officer, from May 1 through November 30, 2020.

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For any telephonic or in-person board meetings in excess of seven meetings, a per meeting fee of $1,500 was paid to each director who attended such meetings. Directors who are employees of Matson or its subsidiaries did not receive compensation for serving as directors. Non-employee directors may defer half or all of their annual cash retainer and meeting fees until retirement or until a later date they may select; Mr. Fukunaga and Ms. Lau deferred all of their respective annual cash retainers and meeting fees in 2020.

Under the terms of the Matson, Inc. 2016 Incentive Compensation Plan (the “2016 Plan”), an automatic grant of approximately $100,000 in restricted stock units was awarded to each director who is elected or reelected as a non-employee director at each Annual Meeting of Shareholders. These awards have 100% cliff vesting on the earlier of the grant date anniversary or the next annual shareholders meeting following the date of the grant. Non-employee directors may defer all or a portion of their vested shares until cessation of board service or the fifth anniversary of the award date, whichever is earlier. The deferred shares earn dividend equivalents that are paid when the shares are issued. Admiral Fargo elected to make such a deferral in 2020.

Directors have business travel accident coverage of $200,000 for themselves and $50,000 for their spouses while accompanying directors on Matson business. They also may participate in the Company’s matching gifts program for employees, in which the Company matches contributions to qualified cultural and educational organizations up to a maximum of $3,000 annually.

Director Stock Ownership Guidelines

The Board has Stock Ownership Guidelines that encourage each non-employee director to own Matson common stock (including restricted stock units) with a value of five times the amount of the current cash retainer within five years of becoming a director. All non-employee directors have met or are on track to meet the established guidelines.

Shareholder Engagement

Matson values the views of its shareholders, which is why we regularly and proactively engage with our largest shareholders throughout the year. During 2020, management met or offered to meet with shareholders who collectively own approximately two-thirds of our stock to discuss our business strategy and operations, corporate governance practices and sustainability strategy, and to solicit feedback on these and a variety of other topics. Shareholder perspectives are shared with the Board.

Communications with Directors

Shareholders and other interested parties may contact any of the directors, including the lead independent director, or the independent directors as a group, by mailing correspondence “c/o Matson Law Department” to Matson’s corporate offices at 555 12th Street, Oakland, California 94607. The Law Department will forward such correspondence to the appropriate director(s). However, the Law Department reserves the right not to forward any offensive or otherwise inappropriate materials.

SECURITY OWNERSHIP OF CERTAIN SHAREHOLDERS

The following table lists the names and addresses of the only shareholders known by Matson to have owned beneficially more than five percent of Matson’s common stock outstanding as of December 31, 2020, the number of shares they beneficially own, and the percentage of outstanding shares such ownership represents, based upon the most recent reports filed with the SEC. Except as indicated in

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the footnotes, such shareholders have sole voting and dispositive power over shares they beneficially own.

Name and Address of Beneficial Owner

    

Amount of
Beneficial Ownership

    

Percent of
Class

BlackRock, Inc.

55 East 52nd Street

New York, NY 10055

7,121,719(a)

16.5%

The Vanguard Group

100 Vanguard Blvd.

Malvern, PA 19355

4,243,157 (b)

9.8%

ArrowMark Colorado Holdings, LLC

100 Fillmore Street, Suite 325

Denver, Colorado 80206

3,850,453(c)

8.9%

T. Rowe Price Associates, Inc.

100 E. Pratt Street

Baltimore, MD 21202

3,846,453(d)

8.9%

Dimensional Fund Advisors LP

Building One

6300 Bee Cave Road

Austin, TX 78746

2,466,784(e)

5.7%

Capital Research Global Investors

333 South Hope Street, 55th Floor

Los Angeles, CA 90071

2,463,400(f)

5.7%

Fuller & Thaler Asset Management, Inc.

411 Borel Avenue, Suite 300

San Mateo, CA 94402

2,205,342(g)

5.1%


(a)As reported in a Schedule 13G/A filed with the SEC on January 25, 2021, as of December 31, 2020, BlackRock, Inc. has sole voting power over 7,070,257 shares and sole dispositive power over all 7,121,719 shares, and does not have shared voting or shared dispositive power over any shares.
(b)As reported in a Schedule 13G/A filed with the SEC on February 10, 2021, as of December 31, 2020, The Vanguard Group has shared voting power over 33,489 shares, sole dispositive power over 4,188,037 shares, and shared dispositive power over 55,120 shares.
(c)As reported in a Schedule 13G/A filed with the SEC on February 16, 2021, as of December 31, 2020, ArrowMark Colorado Holdings, LLC has sole voting power and sole dispositive power over all 3,850,453 shares and does not have shared voting or shared dispositive power over any shares.
(d)As reported in a Schedule 13G/A filed with the SEC on February 16, 2021, as of December 31, 2020, T. Rowe Price Associates, Inc. has sole voting power over 1,002,708 shares and sole dispositive power over all 3,846,453 shares, and does not have shared voting or shared dispositive power over any shares.
(e)As reported in a Schedule 13G/A filed with the SEC on February 12, 2021, as of December 31, 2020 (the “Dimensional Fund 13G”), Dimensional Fund Advisors LP has sole voting power over 2,363,666 shares and sole dispositive power over all 2,466,784 shares (subject to the provision of Note 1 of the Dimensional Fund 13G), and does not have shared voting or shared dispositive power over any shares.

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(f)As reported in a Schedule 13G filed with the SEC on February 16, 2021, as of December 31, 2020, Capital Research Global Investors has sole voting power and sole dispositive power over all 2,463,400 shares and does not have shared voting or shared dispositive power over any shares.
(g)As reported in a Schedule 13G/A filed with the SEC on February 11, 2021, as of December 31, 2020, Fuller & Thaler Asset Management, Inc. has sole voting power over 2,142,809 shares and sole dispositive power over all 2,205,342 shares, and does not have shared voting or shared dispositive power over any shares.

CERTAIN INFORMATION REGARDING DIRECTORS AND EXECUTIVE OFFICERS

Security Ownership of Directors and Executive Officers

The following table shows the number of shares of Matson common stock beneficially owned as of February 26, 2021 by each director and nominee, by each Named Executive Officer (as defined below), and by directors, nominees and executive officers as a group. Except as indicated in the footnotes, directors, nominees and executive officers have sole voting and dispositive power over shares they beneficially own.

Name or Number in Group

    

Number of
Shares Owned
(a)

    

Restricted
Stock Units
(b)

    

Total

    

Percent of
Class

Meredith J. Ching

23,255 

3,664 

26,919 

*

Matthew J. Cox

273,127 

− 

273,127 

*

Thomas B. Fargo

28,809 

− 

28,809 

*

Mark H. Fukunaga

13,432 

3,664 

17,096 

*

Stanley M. Kuriyama

32,475 

3,664 

36,139 

*

Constance H. Lau

59,375 

3,664 

63,039 

*

Jenai S. Wall

2,627 

3,664 

6,291 

Joel M. Wine

159,072 

− 

159,072 

*

Ronald J. Forest

71,151 

− 

71,151 

*

Peter T. Heilmann

42,441 

− 

42,441 

*

John P. Lauer

34,266 

− 

34,266 

*

20 Current Directors and Executive Officers as a Group

854,497 

18,907 

873,404 

2.0%


(a)Amounts include shares as to which directors, nominees and executive officers have shared voting and dispositive power, as follows: Mr. Forest and spouse — 69,600 shares.
(b)Amounts include shares deemed to be beneficially owned by directors, nominees and executive officers because they may be acquired within 60 days from February 26, 2021 upon the vesting of restricted stock units.

*

Represents less than 1% of the issued and outstanding shares of the Company’s common stock as of February 26, 2021.

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) requires Matson’s directors and executive officers, and persons who own more than 10% of Matson’s common stock, to file reports of ownership and changes in ownership with the SEC. Based solely on a review of those reports filed with the SEC and any written representations that no other reports were required, Matson believes that, during fiscal 2020, its directors and executive officers and persons who owned more than 10% of Matson’s common stock filed all reports required to be filed under Section 16(a) on a timely basis, except that due to administrative errors (i) a Form 5 was filed in February 2021 to report 1,069 shares of Matson common stock that should have been reported on Branton B. Dreyfus’ Form 3 filed in March 2019, and

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(ii) a Form 4 was filed in March 2021 for Admiral Fargo that corrected the underreporting of 125 shares of Matson common stock in connection with automatic purchases under a Dividend Reinvestment Program.

Certain Relationships and Transactions

Matson has adopted a written policy under which the Audit Committee must pre-approve or ratify all related person transactions that are disclosable under SEC Regulation S-K, Item 404(a). Prior to entering into a transaction with Matson, directors and executive officers (and their family members) and shareholders who beneficially own more than five percent of Matson’s common stock must make full disclosure of all facts and circumstances to the Law Department. The Law Department then determines whether such transaction requires the approval of the Audit Committee. The Audit Committee considers all of the relevant facts available, including (if applicable) but not limited to: the benefits to the Company; the impact on a director’s independence in the event the person in question is a director, an immediate family member of a director or an entity in which a director is a partner, shareholder or executive officer; the availability of other sources for comparable products or services; the terms of the transaction; and the terms available to unrelated third parties or to employees generally. The Audit Committee will approve only those related person transactions that are in, or are not inconsistent with, the best interests of the Company and its shareholders.

The Audit Committee has established written procedures to address situations when approvals need to be sought between meetings. Whenever possible, proposed related person transactions will be included as an agenda item at the next scheduled Audit Committee meeting for review and approval. However, if it appears that a proposed related person transaction will occur prior to the next scheduled Audit Committee meeting, approval will be sought from Audit Committee members between meetings. Approval by a majority of the Audit Committee members will be sufficient to approve the related person transaction. If a related person transaction is approved in this manner, the action will be reported at the next Audit Committee meeting. The transactions described below were ratified or approved by the Audit Committee in accordance with its written procedures.

Mr. Fukunaga, a director of Matson, is Chairman and Chief Executive Officer, and owns more than 10% of the common stock, of Servco. In 2020, Matson provided shipping services to or for the benefit of Servco for approximately $315,000. The transactions between Servco and Matson were conducted in the ordinary course of business on standard commercial terms.

Ms. Lau, a director of Matson, is President, Chief Executive Officer and Director of HEI, as well as Chairman of the Board of American Savings Bank, a subsidiary of HEI. American Savings Bank currently has a 5.38% participation in the Company’s $650,000,000, five-year unsecured revolving credit facility. The credit facility, including American Savings Bank’s participation, was entered into in the ordinary course of business; was made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to the lender; and did not involve more than the normal risk of collectability or present other unfavorable features. Ms. Lau abstained from voting when the Board approved the amendment and restatement of the revolving credit facility in 2017.

Ms. Wall, a director of Matson, is Chairman and Chief Executive Officer, and owns more than 10% of the common stock, of Foodland. In 2020, Matson provided shipping services to or for the benefit of Foodland for approximately $534,200. The transactions between Foodland and Matson were conducted in the ordinary course of business on standard commercial terms.

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The parents of Vicente S. Angoco, the Senior Vice President, Pacific of Matson, own and operate a company which provides drayage of some Matson containers in Guam. The approximate dollar value of the payment from Matson in connection with this service in 2020 was $349,600. The brother of Mr. Angoco owns and operates a company with which the Company contracts for chassis repair and maintenance services in Guam. The approximate dollar value of the payment from Matson in connection with this service in 2020 was $482,000. The brother-in-law of Mr. Angoco owns and operates a company with which the Company contracts for the provision of temporary and contract workers in Guam. The approximate dollar value of the payment from Matson in connection with this service in 2020 was $1,013,900. Mr. Angoco has no monetary or other interest in any of the businesses described above. These transactions were conducted in the ordinary course of business on standard commercial terms.

Code of Ethics

Matson has adopted a Code of Ethics that applies to the CEO, the Chief Financial Officer (“CFO”) and the Controller. A copy of the Code of Ethics is posted on the corporate governance page of Matson’s corporate website, www.matson.com. Matson intends to disclose any changes in or waivers from its Code of Ethics by posting such information on its website within four business days following the amendment or waiver.

Code of Conduct

Matson has adopted a Code of Conduct, which is applicable to all directors, officers and employees, and is posted on the corporate governance page of Matson’s corporate website. Matson intends to disclose any changes in its Code of Conduct or waivers from its Code of Conduct granted to directors or executive officers by posting such information on its website.

Executive Officers

The name of each executive officer of Matson, age as of March 9, 2021, and present and prior positions with Matson and business experience for the past five years are given below. Generally, the term of office of executive officers is at the pleasure of the Board of Directors.

Vicente S. Angoco, Jr. (54): Senior Vice President since June 2012; Senior Vice President, Pacific of MatNav since January 2011; Vice President, Pacific of MatNav, March 2008 – January 2011; General Manager, Guam and Micronesia of MatNav, December 2006 – March 2008; first joined Matson or a subsidiary in 1996.

Grace M. Cerocke (42): Senior Vice President since February 2021; Senior Vice President, Finance of Matson Logistics, since February 2021; Vice President, Finance of Matson Logistics, October 2012 – January 2021; first joined Matson or a subsidiary in 1997.

Matthew J. Cox (59): Chairman of the Board since April 2017 and Chief Executive Officer since June 2012; President, June 2012 – April 2017; Chairman and CEO of MatNav since June 2012; President of MatNav, October 2008 – April 2017; Executive Vice President and Chief Operating Officer of MatNav, July 2005 – September 2008; first joined Matson or a subsidiary in 2001.

Branton B. Dreyfus (67): Senior Vice President since January 2020; Vice President, February 2019 – January 2020; Senior Vice President, Alaska of MatNav since January 2020; Vice President, Alaska of MatNav, February 2019 – January 2020; Vice President, Key Commodities of MatNav, January 2019 – February 2019; Vice President, Equipment and Purchasing of MatNav, May 2017 –

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February 2019; Vice President, West Coast Terminals and Vehicle Operations of MatNav, July 2005 – May 2017; first joined Matson or a subsidiary in 1993.

Ronald J. Forest (65): President since April 2017; Senior Vice President, June 2012 – April 2017; President of MatNav since April 2017; Senior Vice President, Operations of MatNav, April 2003 – April 2017; first joined Matson or a subsidiary in 1995.

Qiang Gao (57): Senior Vice President since February 2021; Senior Vice President, Asia of MatNav since February 2021; Vice President, Asia of MatNav, September 2012 – January 2021; first joined Matson or a subsidiary in 2003.

Peter T. Heilmann (52): Executive Vice President, Chief Administrative Officer and General Counsel since February 2021; Senior Vice President, Chief Administrative Officer and General Counsel, April 2018 – February 2021; Senior Vice President and Chief Administrative Officer, January 2018 – April 2018; Senior Vice President and Chief Administrative Officer, April 2017 – January 2018; Senior Vice President and Chief Legal Officer, March 2014 – April 2017; Executive Vice President, Chief Administrative Officer and General Counsel of MatNav since February 2021; Senior Vice President, Chief Administrative Officer and General Counsel of MatNav, April 2017 – February 2021; Senior Vice President and Chief Administrative Officer of MatNav, March 2014 – April 2017; first joined Matson or a subsidiary in 2012.

Richard S. Kinney (57): Senior Vice President since April 2020; Senior Vice President, Network Operations of MatNav since January 2020; Vice President, West Coast Terminals and Purchasing of MatNav, May 2017 – January 2020; Vice President, Equipment & Inland Operations, January 2016 – April 2017; first joined Matson or a subsidiary in 1998.

John P. Lauer (60): Executive Vice President and Chief Commercial Officer since February 2021; Senior Vice President and Chief Commercial Officer, April 2017 – January 2021; Senior Vice President, Ocean Services, March 2015 – April 2017; Executive Vice President and Chief Commercial Officer of MatNav since February 2021; Senior Vice President and Chief Commercial Officer of MatNav, April 2017 – January 2021; Senior Vice President, Ocean Services of MatNav, March 2015 – April 2017; Vice President, Transpacific Services of MatNav, 2012 – March 2015; Director, Transpacific Services of MatNav, 2010 – 2012; first joined Matson or a subsidiary in 2007.

Laura L. Rascon (58): Senior Vice President since February 2021; Senior Vice President, Customer Experience of MatNav since February 2021; Vice President, Customer Support of MatNav, July 2008 – January 2021; first joined Matson or a subsidiary in 1983.

Rusty K. Rolfe (63): Executive Vice President since February 2021; Senior Vice President, June 2012 – January 2021; President of Matson Logistics since July 2012; Executive Vice President, Matson Logistics, August 2011 – July 2012; Executive Vice President, Matson Integrated Logistics, April 2006 – August 2011; first joined Matson or a subsidiary in 2001.

Christopher A. Scott (47): Senior Vice President since February 2021; Senior Vice President, Transpacific Services of MatNav since February 2021; Vice President, Transpacific Services of MatNav, January 2015 – January 2021; first joined Matson or a subsidiary in 1995.

John W. Sullivan (67): Senior Vice President since April 2020; Senior Vice President, Vessel Operations and Engineering of MatNav since January 2020; Vice President, Vessel Operations and Engineering of MatNav, August 2003 – January 2020; first joined Matson or a subsidiary in 1993.

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Joel M. Wine (49): Executive Vice President and Chief Financial Officer since February 2021; Senior Vice President and Chief Financial Officer, September 2011 – January 2021; Executive Vice President and Chief Financial Officer of MatNav since February 2021; Senior Vice President and Chief Financial Officer of MatNav, June 2012 – January 2021; first joined Matson or a subsidiary in 2011.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

In this Compensation Discussion and Analysis (“CD&A”), Matson explains the material elements of its 2020 compensation practices for the executive officers named in the Summary Compensation Table on page 39 (collectively, the “Named Executive Officers” or “NEOs”). The NEOs for 2020 are:

Matthew J. Cox, Chairman of the Board and Chief Executive Officer,
Joel M. Wine, Executive Vice President and Chief Financial Officer,
Ronald J. Forest, President,
Peter T. Heilmann, Executive Vice President, Chief Administrative Officer and General Counsel, and
John P. Lauer, Executive Vice President and Chief Commercial Officer.

Executive Summary

For 2020, Matson generated net income of $193.1 million, or $4.44 per diluted share, as compared to net income of $82.7 million, or $1.91 per diluted share, generated in 2019. Earnings before interest, income taxes, depreciation and amortization (“EBITDA”) for 2020 increased $159.4 million year-over-year to $423.7 million. A reconciliation of our GAAP to non-GAAP results can be found in Exhibit B to this Proxy Statement. Matson’s consolidated financial performance in 2020 was solid despite the challenges presented by the COVID-19 pandemic and related economic effects. Our China tradelane service saw significant demand for its CLX and CLX+ expedited ocean services (CLX+ is a new service initiated in 2020) and was the primary driver of the increase in consolidated operating income year-over-year. Hawaii and Guam volumes approached the levels achieved in the year ago period despite the economic challenges from the pandemic, and Alaska volume was modestly higher than the level achieved in the full year 2019. Logistics operating income was modestly lower compared to the level achieved in the full year 2019 largely due to the pandemic’s impacts on the business lines in the first half of the year.

The Company’s 2020 results exceeded the extraordinary annual performance measures that were incorporated into the Board of Directors approved 2020-2022 Operating Plan, and Matson’s three-year performance for the period ended December 31, 2020 under the equity compensation program was above extraordinary performance. Each operating plan is Matson’s tactical and strategic view of future performance, and contains a three-year projection of financial and operating results, the key elements of which are incorporated as performance targets in the Company’s incentive compensation plans, as discussed in this CD&A.

Impact of COVID-19 pandemic on pay. Beginning May 1, 2020, as part of the Company’s response plan to the economic effects of the COVID-19 pandemic, the Company implemented salary reductions for approximately 100 management employees including the executive officers. Mr. Cox’s base salary was reduced by 30% and the base salaries of the other named executive officers’ were reduced by 20% from May 1 through November 30, 2020. The Board of Directors also reduced its cash retainers

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and meeting fees by 30% from May 1 through November 30, 2020. The Company did not make any adjustments to performance measures, payout opportunities or plan mechanics under the incentive compensation plans.

Pay-for-performance. In line with Matson’s continued emphasis on managing a compensation program that links pay to performance, performance-based awards are determined using the following performance metrics: EBITDA for the Company’s annual cash incentive plan and the average annual return on invested capital (“ROIC”) and three-year cumulative total shareholder return (“TSR”) relative to peer indices for the Company’s Performance Share awards (“Performance Shares”). These performance metrics align with Matson’s strategic objectives for profitable growth, efficient use of capital and increasing the value of Matson’s common stock for shareholders. Compensation awarded to the NEOs for 2020 performance reflected Matson’s financial results:

Annual Cash Incentive: Above extraordinary performance of the overall Company goals and above target performance of individual goals resulted in payouts for NEOs ranging from approximately 188% to 199% of their respective targets. See “Components of Executive Compensation — Annual Cash Incentives”.
2018-2020 Performance Shares: Above extraordinary average ROIC performance and above extraordinary relative TSR positioning resulted in payouts for NEOs of 250% of their respective targets. See “Components of Executive Compensation — Equity-Based Compensation”.

Matson’s Compensation Philosophy

The objective of Matson’s executive compensation program is to help attract, retain and motivate talented executives who provide strong leadership for Matson and develop and execute effective strategies that maximize long-term shareholder value. The program is designed to be market competitive and emphasize pay-for-performance by making the majority of NEO compensation “at risk”. This is accomplished by aligning incentive pay with the achievement of key annual and long-term operating goals, growth in shareholder value and individual performance. In 2020, 80% of Mr. Cox’s and approximately 70% of the other NEOs’ target total direct compensation were variable and at-risk based on annual and long-term performance. The material elements of total direct compensation for Matson’s NEOs are base salaries, annual cash incentives and equity incentives. Annual equity awards are split evenly between time-based restricted stock units (“time-based RSUs”) and Performance Shares that are measured over a 3-year performance period. NEOs are also eligible for retirement, severance and change in control termination benefits and participate in other employee health and welfare programs.

All elements of total direct compensation to the NEOs are generally benchmarked against the 50th percentile of competitive market practices. However, market data is only one of many factors considered in determining individual executive pay, including demonstrated performance, experience in the position, scope of impact and internal equity with other executives.

In order to promote the compensation philosophy described above, Matson continues to monitor its existing pay practices, as highlighted below, to ensure that it adopts the best practices to the extent they are aligned to the business goals and strategy of the Company, as well as shareholder interests.

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Promote Good Pay Practices

    

Discourage Bad Pay Practices

Change in control agreements that include double triggers requiring both a change in control event and termination of employment before any severance payments can be made

Pay packages for the CEO and NEOs that are in line with the Companys peer group

Different financial, operating and stock price performance metrics to determine incentive payments in annual and long-term incentive awards

Vesting of 50% of annual equity award is tied to achievement of specified performance goals, including relative TSR

Strong executive and director stock ownership guidelines

Minimum vesting periods of three years on all equity awards to senior executives

No-fault clawback policy that applies to all senior management

Policy prohibiting hedging and other speculative transactions involving Company stock by employees, officers and directors

No employment contracts with any executive officer

No guaranteed bonus payments to executive officers

No bonus payouts that are not tied to performance

No single trigger vesting of equity in change of control

No pension payouts that are not proportional to pension payouts to employees generally

No excessive perquisites

No excessive severance or change in control provisions

No tax reimbursements or gross-ups

No dividends or dividend equivalents paid on unvested Performance Shares

No unreasonable internal pay disparity

No re-pricing or replacing of underwater stock options, without prior shareholder approval

No above-market interest on deferred compensation plans

Matson’s Continued Focus on Pay-for-Performance

Say-on-Pay Vote in 2020. At the 2020 Annual Meeting of Shareholders, an advisory vote approved the compensation of the NEOs with over 97% of votes cast voting in favor of the executive compensation program. The Compensation Committee took these results into consideration and concluded it should continue to apply the same basic compensation philosophy.

Pay-for-Performance Emphasis. The following features of the 2020 NEO compensation program emphasize Matson’s focus on pay-for-performance:

Performance Metrics are Aligned with Shareholder Value. Matson’s performance-based awards are determined using the following performance metrics: EBITDA for the Company’s annual incentive plan and ROIC and TSR relative to peer indices for the Company’s Performance Shares. These performance metrics align with Matson’s strategic objectives for profitable growth, efficient use of capital and increasing the value of Matson’s common stock for shareholders. The financial performance metrics used for annual cash and long-term incentive compensation are also different in order to avoid focusing the NEOs’ attention on a single performance goal at the expense of achieving other important goals for maximizing the long-term value of the Company for shareholders. To continue to promote pay-for-performance, beginning in 2021, the relative TSR modifier will be replaced with a discrete relative TSR metric for Performance Share awards. Further details on the TSR metric are provided on page 42.
Multi-Year Performance Periods to Emphasize Long-Term Growth. Matson grants Performance Shares focused on multi-year performance over a three-year measurement period with vesting determined at the end of the period based on average annual ROIC and three-year cumulative TSR relative to the companies comprising the S&P Transportation

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Select Industry Index and S&P MidCap 400 Index. The three-year performance period is intended to encourage Matson’s NEOs to focus on growth of the Company and shareholder value over a multi-year period of time. Performance Shares granted in 2020 will not be settled until 2023 following the end of the three-year performance period (FY 2020-2022).

No Stock Option Grants. With its continued emphasis on granting awards that contain specific performance goals, such as the Performance Shares, Matson again did not grant stock options to its NEOs in 2020.

Compensation Decision Process

Role of the Compensation Committee. The Compensation Committee of Matson’s Board makes all decisions about the compensation of the NEOs. The process that it follows for Mr. Cox is different from the process for all other NEOs.

Determining CEO Compensation. For decisions affecting the CEO’s compensation, the Board has a formal performance review process that starts at the beginning of the year with an analysis and establishment of the CEO’s future performance goals. Mr. Kuriyama, in his role as Lead Independent Director, directed this process in developing the CEO’s objectives. Mr. Kuriyama reviewed a variety of factors, including the CEO’s prior performance objectives, the CEO’s achievement of those objectives, the performance of the Company, the Company’s current Operating Plan, as well as the Compensation Committee’s independent consultant’s market analysis and recommendations of CEO pay, including target annual incentive levels and equity grants. Following the analysis and review process, Mr. Kuriyama received input from the Board of Directors, after which the Board finalized the CEO’s annual performance objectives. The objectives for any given year include, but are not limited to, achieving the annual operating plan results, any growth initiatives, other strategic initiatives and the CEO’s core responsibilities. The objectives are documented as part of setting the CEO’s annual compensation package.

After completion of the fiscal year, Mr. Kuriyama and the Compensation Committee conducted an assessment of the CEO’s performance against the objectives set at the beginning of the year and determined the payout of the CEO’s annual cash incentive. Mr. Kuriyama and the Compensation Committee also reviewed competitive market data and determined the merit adjustment to the CEO’s base salary and size of equity incentive award to be granted. The Compensation Committee subsequently presented the results of this process to the full Board of Directors. The Board of Directors discussed the results of the assessment, including the areas of greatest strength and areas where improvements could be made.

Determining Compensation of other NEOs. For decisions affecting the compensation of the other NEOs, the Compensation Committee follows a similar process, but takes into consideration recommendations made by Mr. Cox.

In evaluating pay actions and the mix of pay elements for all NEOs (including Mr. Cox), the Compensation Committee reviews:

A summary of the value of all compensation elements provided to the executive during the year;
Competitive market peer group and broader industry survey data;
Health and welfare benefits and retirement plan balances;
Prior compensation decisions and realized values for the past five years through tally sheets;

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Business strategic goals and performance expectations;
Expected and actual Company and individual performance; and
Insight from the shareholder say-on-pay vote results.

The Compensation Committee uses the above information to evaluate the following:

Alignment of the pay program with the Compensation Committee’s commitment to pay-for-performance;
Consistency with competitive market practices;
Reasonableness and balance of pay elements as they relate to pay risk;
Year-to-year pay movement for each NEO to ensure it reflects any variations in annual performance and market conditions;
Internal pay equity with other executives based on individual performance, job scope and impact; and
The effect of potential future payments, awards and plan design changes on the executive’s total pay package.

Role of the CEO. Mr. Cox recommends annual compensation actions for other NEOs to the Compensation Committee. In consultation with each NEO, Mr. Cox develops individual performance plans that serve as the basis for the determination of annual incentive awards. After the completion of the fiscal year, Mr. Cox reviews executive officer performance relative to individual goals and Company performance and makes recommendations to the Compensation Committee about each officer’s incentive award. In addition to performance results, Mr. Cox considers any changes in job scope, internal pay relationships to other executives, merit increase guidelines and market pay studies to recommend changes in base salary, annual cash incentive awards and equity awards for Compensation Committee approval.

Role of Independent Consultant. The Compensation Committee believes that using an independent compensation consultant is important in developing executive compensation programs that are reasonable, consistent with Matson’s pay philosophy and market competitive. Since the end of 2012, the Compensation Committee has retained Exequity LLP (“Exequity”), an independent executive compensation consulting firm, to provide executive compensation services. Exequity reports directly to the Compensation Committee and the Compensation Committee Chair pre-approves all executive compensation engagements, including the nature, scope and fees of assignments. Exequity advised the Compensation Committee on all aspects of executive compensation including the following during 2020:

Recommended peer group assessment criteria and identified and recommended potential peer companies;
Provided information on trends and regulatory developments for executive compensation;
Evaluated the size and structure of the components of Matson’s executive compensation program relative to the Company’s peer group and broader market practices;
Reviewed and commented on recommendations regarding executive pay, including target annual incentive levels, equity grants, and performance share unit design;
Reviewed the compensation risk assessment;
Analyzed and reviewed equity usage levels in determining new share authorization proposal; and
Reviewed and assisted in the preparation of the executive compensation disclosure in the annual proxy statement.

Exequity also assessed Board pay levels, reviewed the structure of Board compensation, and recommended adjustments to Board pay. In the course of fulfilling these responsibilities, a representative

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attended all Compensation Committee meetings held during the year, participated in executive sessions of the Compensation Committee without management present, and met with management from time to time to gather relevant information and provide input in assessing management proposals. The Compensation Committee’s executive compensation decisions, including the specific amounts paid to Matson’s executive officers, are made through the exercise of its own judgment and may reflect factors and considerations other than the information and recommendations provided by its compensation consultant, including the executive’s role and organizational impact, experience, tenure, sustained performance over time, and internal pay relationships. Exequity has not provided any other services to the Compensation Committee and has received no compensation from the Company other than with respect to the services described above.

Pursuant to SEC rules, the Compensation Committee has assessed the independence of Exequity and concluded that no conflict of interest exists that would prevent Exequity from independently representing the Compensation Committee.

Role of Management. Management assists the Compensation Committee in its role of determining executive compensation in a number of ways, including:

Providing management’s perspective on compensation plan structure and implementation;
Identifying appropriate performance measures and establishing individual performance goals that are consistent with the Board-approved Operating Plan;
Providing the data used to measure performance against established goals, with Mr. Cox providing perspective on individual executive performance and compensation amounts; and
Providing recommendations, based on information provided by the Compensation Committee consultant, regarding pay levels for NEOs in 2020 on the basis of plan formulas, salary structures and Mr. Cox’s assessment of individual officer performance.

Role of Market Data. As there are few companies directly comparable to Matson in business mix, size and location of operation, based on the recommendation of its compensation consultant, the Compensation Committee used a combination of peer group proxy statement data and published general industry survey data as a benchmark reference in the 2020 compensation decision-making process. This competitive market data serve as only one of many factors the Compensation Committee considers in assessing and determining appropriate pay levels as it exercises its business judgment. Other factors the Committee considers include Matson’s pay philosophy, incumbent job scope of responsibility, tenure, organization impact, internal equity, Company and individual performance, and historical pay actions.

The consultant conducted an independent review of the peer group and established the following selection criteria to develop a recommended peer group for the Compensation Committee’s approval:

Transportation-related companies (including air freight, airline, marine, railroad, trucking and logistics management operations);
Companies with similar size characteristics, including annual revenues generally within one-half to two times Matson’s annual revenue and having a market capitalization that is generally less than five times Matson’s market capitalization; and
Additional companies that may be outside these size parameters but have other relevant business and operating characteristics to Matson and are influenced by similar economic and regulatory factors.

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Based on these factors, the consultant recommended and the Compensation Committee approved a peer group of the following sixteen public transportation-related companies (“peer group”) for pay comparisons starting in 2019 for 2020 pay assessments:

·

Air Transport Services Group, Inc.

·

ArcBest Corporation

·

Atlas Air Worldwide Holdings, Inc.

·

Echo Global Logistics, Inc.

·

Forward Air Corporation

·

Genesee & Wyoming Inc.

·

Hawaiian Holdings, Inc.

·

Hub Group, Inc.

    

·

Kansas City Southern

·

Kirby Corporation

·

Knight-Swift Transportation Holdings Inc.

·

Landstar System, Inc.

·

Old Dominion Freight Line, Inc.

·

Saia, Inc.

·

SEACOR Holdings Inc.

·

Werner Enterprises, Inc.

Bristow Group was eliminated from the peer group due to their bankruptcy filing and Air Transport Services Group, Inc. was added. Matson is between the 25th and 50th percentiles of this peer group in revenue and market capitalization. Given the limited number of relevant publicly traded transportation companies similar enough to Matson’s profile to serve as meaningful comparisons, the Compensation Committee believes the peer group recommended by its compensation consultant provides a reasonable basis for analyzing compensation for Matson’s NEOs. The Compensation Committee will continue to collect general industry data for similar revenue size companies as additional reference for competitive market analysis, particularly for NEOs other than Mr. Cox, given the limited number of similarly sized companies in the peer group and competition for talent with other industry segments.

Components of Executive Compensation

The material elements of compensation for Matson’s NEOs are base salaries, annual cash bonuses and equity incentives. NEOs also are eligible for retirement, severance and change in control termination benefits and participate in other employee benefit programs.

Base Salary: Salary is intended to provide a minimum fixed rate of pay which comprises less than 32% of an NEO’s target total direct compensation. Salary increases can be awarded in recognition of extraordinary performance, organizational advancement and increasing levels of responsibility, as well as projections for market movement and merit guidelines established for the Company. Generally, base salaries for Matson’s NEOs are based on the Compensation Committee’s determination of appropriate salary levels, taking into consideration peer group and survey information, Mr. Cox’s recommendations (for NEOs other than himself), the executive’s role in the organization, individual performance during the prior fiscal year and relative pay position to other Matson executives.

In January 2020, the Compensation Committee increased base salary for Mr. Lauer by 13% reflecting his individual performance, contributions to the Company and competitive positioning relative to market levels. In February 2020, in connection with Matson’s overall merit program, the Compensation Committee increased the base salaries for all NEOs, including Mr. Cox, by 3% to keep up with inflation and general market practices.

In response to the concern regarding the impact of the COVID-19 pandemic on the Company’s business, from May 1, 2020 to November 30, 2020, Mr. Cox’s base salary was reduced by 30% and the base salaries of the other named executive officers were reduced by 20%.

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Annual Cash Incentives: Annual incentives for NEOs are provided through the Cash Incentive Plan (the “CIP”). The CIP was designed to align performance incentives at all participating organization levels, to motivate executives to contribute to the Company’s success and to reward them if they achieve specific pre-established corporate and individual goals. These goals are established in February of each year based on the use of the metrics described below.

Weighting of Goals. The weighting of the corporate and individual goals depends on the executive’s position and responsibilities. The intention is to weight a significant portion of the awards on the financial results of the Company, but balance that with important strategic and operating goals that have been established for the year through the individual portion. The 2020 weighting is as follows:

Weighting of 2020 CIP Goals for NEOs

NEO

    

Corporate

    

Individual

Matthew J. Cox

70%

30%

Joel M. Wine

70%

30%

Ronald J. Forest

70%

30%

Peter T. Heilmann

70%

30%

John P. Lauer

70%

30%

Determination of Annual Cash Incentive Award. Each component – corporate and individual – is evaluated against the respective performance goals. There are three levels of award opportunities for each component: threshold, target and extraordinary. In 2020, the target award opportunity levels for NEOs ranged from 70% to 100% of salary, which is consistent with competitive market targets. If a threshold goal is not achieved, there is no payout for that component. If threshold goals are achieved, a participant receives 50% of the target award opportunity set for that component. If target or extraordinary goals are achieved, a participant receives 100% or 200%, respectively, of the target award opportunity for that component. Awards are prorated for performance between the threshold, target and extraordinary levels, as applicable. No additional award is provided for performance above the extraordinary goal level. The maximum achievable award in the aggregate is 200% of the NEO’s target award opportunity.

Mr. Cox reviews the annual individual incentive award calculations for each individual other than himself and makes recommendations to the Compensation Committee regarding payouts. For Mr. Cox’s individual incentive award calculation, the Lead Independent Director reviews Mr. Cox’s individual performance achievement and provides the results to the Compensation Committee. The Compensation Committee reviews and approves all awards and has discretion to modify recommended awards to take into consideration factors it believes appropriately reflect the performance of the Company and the individual. Such factors vary, but may include, for individuals, adjustments for an executive taking on temporary but significant responsibilities in addition to his normal job role, or for the Company or a business unit, adjustments for extraordinary or unusual events.

Company Performance. The corporate component measure in 2020 was based on the 2020-2022 Operating Plan approved by the Board of Directors and was weighted 100% on consolidated EBITDA performance, subject to any adjustments made to accurately reflect the Company’s 2020 performance. Any adjustments are at the sole discretion of the Compensation Committee. EBITDA was selected as the CIP corporate performance measure because the Company believes it best reflects the annual operating results of business execution and profitability levels. The Company believes that EBITDA is a critical annual operating performance measure and, in combination with the multi-year performance measures of ROIC and relative TSR applicable to Performance Shares (described below in “Performance Shares”), provides focus and alignment with shareholder interests.

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Annual incentive goals at threshold, target and extraordinary (maximum) are approved by the Compensation Committee in February of each year. The 2020 annual corporate and business unit targets reflected the Company’s Board-approved Operating Plan. When establishing the Operating Plan, management and the Board of Directors consider the historical performance of the Company, external elements such as economic conditions and competitive factors and Company capabilities. In 2020, the Compensation Committee set threshold performance at 90% of target and extraordinary performance at 120% of target for EBITDA results. The threshold and extraordinary goals were determined on the basis of the level of difficulty in achieving the target objective as well as establishing a reasonable range of performance variability around the Operating Plan target.

For determination of CIP award levels for 2020, the Company’s operating performance was compared to the performance goals approved by the Compensation Committee in February 2020. Corporate goals and the actual result were as follows:

Company Performance Results Related to the 2020 CIP

Corporate Goal

    

Threshold

    

Target

    

Extraordinary

    

Actual

 

EBITDA (000s)

$

264,604 

$

294,005 

$

352,806 

$

423,709 

Individual Performance. In addition to the corporate performance goal, 30% of each NEO’s 2020 award under the CIP was based on achieving individual goals, which reflect the NEO’s position in the Company and the activities of the NEO’s business function. Individual goals contain performance metrics and are reviewed by the Compensation Committee each year. Performance against individual goals is assessed at threshold, target and extraordinary levels; achievement of some but not all individual goals can result in a partial payout. The primary individual NEO goals are listed below.

NEO

    

Individual Goals

Matthew J. Cox

·

Perform core CEO responsibilities effectively

·

Hawaii service vessel transition

·

Effective execution of organic growth initiatives

·

Achieve Companys cost reduction and margin improvement initiatives

Joel M. Wine

·

Perform core CFO responsibilities effectively

·

Lead strategic growth initiatives and other critical initiatives within the Company

·

Manage and improve the Companys debt capital structure

·

Achieve Western Alaska growth strategy

·

Achieve Companys cost reduction and margin improvement initiatives

Ronald J. Forest

·

Achieve operations expense and income objectives

·

Achieve capital plan, dry-dock plan, vessel maintenance & repair plan and hull & machinery insurance reserve objectives

·

Achieve service objectives

·

Manage Companys new vessel program

·

Lead Companys steamship recycling strategy

·

Achieve Companys cost reduction and margin improvement initiatives

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NEO

    

Individual Goals

Peter T. Heilmann

·

Oversee resolution of government investigations, general claims and litigation matters

·

Manage and oversee legal aspects of significant corporate initiatives

·

Perform core Chief Administrative Officer responsibilities effectively

·

Oversee general regulatory compliance and mitigate future litigation risks through compliance

·

Achieve Companys cost reduction and margin improvement initiatives

John P. Lauer

·

Achieve Hawaii market share objectives

·

Lead Hawaii Optimization strategy

·

Develop strategic commercial initiatives

·

Develop growth initiatives

·

Achieve Companys cost reduction and margin improvement initiatives

Total Performance for 2020. Actual CIP awards earned versus target averaged approximately 194% of the overall targeted goal payouts and were as follows:

2020 CIP Payouts for NEOs

NEO

    

2020
Target

Award

    

Actual
Award

for 2020

    

% of
Target

    

Corporate
Performance
Relative to

Target

    

Corporate
Component
Payout
(1) 
(70%
Weighting)

    

Overall
Individual
Performance

Rating

   

Individual
Component
Payout (30%

  Weighting)

Matthew J. Cox

$

844,132 

$

1,669,271 

198%

200.0%

$

1,181,785 

Extraordinary

$

487,486 

Joel M. Wine

$

383,260 

$

760,771 

199%

200.0%

$

536,564 

Extraordinary

$

224,207 

Ronald J. Forest

$

382,455 

$

720,449 

188%

200.0%

$

535,437 

Above Target

$

185,012 

Peter T. Heilmann

$

305,964 

$

584,391 

191%

200.0%

$

428,350 

Above Target

$

156,041 

John P. Lauer

$

307,593 

$

578,275 

188%

200.0%

$

430,631 

Above Target

$

147,644 


(1)144% consolidated EBITDA performance resulted in a 200% corporate component payout.

Equity-Based Compensation: The equity portion of the total compensation program is designed to:

Align management and shareholder interests;
Provide incentive to achieve strategic operating goals and increase shareholder value over the longer-term; and
Motivate and retain Matson’s executives.

With equity being an important and significant element of the total compensation program, management has proposed new share reserve authorization be presented for shareholder approval in 2021.

Performance Shares. In 2020, Matson continued the use of Performance Share awards focused on multi-year performance over a three-year measurement period. Settlement of the Performance Shares granted in 2020 is determined after the end of the three-year performance period (i.e., December 31, 2022). The actual number of shares that vest is based on Matson’s three-year annual average ROIC

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performance against pre-established goals approved by the Compensation Committee in January 2020 (the primary performance measure) and Matson’s TSR as measured against the S&P Transportation Select Industry Index and S&P MidCap 400 Index over the three-year period (the performance modifier). The total number of Performance Shares earned may range from zero to 200% of the target grant size based on the Company’s primary performance measure results and then that percentage is further adjusted +/- 25% based on the TSR performance modifier results. No Performance Shares will vest sooner than three years from the date of grant except under certain circumstances in connection with the occurrence of a change in control of the ownership of Matson.

On December 31, 2020, the performance period for the 2018-2020 Performance Share grant ended. For determination of the Performance Share award levels, the Company’s ROIC and relative TSR performance were compared to the performance goals approved by the Compensation Committee in January 2018. ROIC is defined as (1) net income plus (2) after-tax interest expense divided by (3) average debt plus average total shareholders’ equity, subject to any adjustments made to accurately reflect the Company’s performance. Any adjustments are at the sole discretion of the Compensation Committee. Corporate goals and the actual results were as follows:

Company Performance Results Related to the 2018-2020 Performance Share Awards

Corporate Goals

    

Threshold

    

Target

    

Extraordinary

    

Actual

3-Year Average ROIC

5.2%

6.5%

7.8%

8.7%

3-Year Relative TSR – MidCap 400

25th

50th

75th

90th

3-Year Relative TSR – Transportation

25th

50th

75th

95th

Settlement of 2018-2020 Performance Share Grant. Actual Performance Share awards earned versus target were 250%, as follows:

2018-2020 Performance Share Award Settlement for NEOs

NEO

    

2018-2020
Target
Award (#)

    

ROIC
Performance
Relative to
Target

    

ROIC
Payout %

    

TSR
Performance

    

TSR Modifier
% Applied to
ROIC

Payout%

    

2018-2020
Actual
Award (#)

Matthew J. Cox

39,962

133.9%

200.0%

90th/95th

+25%

99,905

Joel M. Wine

9,591

133.9%

200.0%

90th/95th

+25%

23,977

Ronald J. Forest

9,591

133.9%

200.0%

90th/95th

+25%

23,977

Peter T. Heilmann

7,993

133.9%

200.0%

90th/95th

+25%

19,982

John P. Lauer

7,993

133.9%

200.0%

90th/95th

+25%

19,982

Each NEO was awarded a 2018-2020 Performance Share grant in January 2018. Pursuant to the vesting provisions of these grants, vesting occurred on January 27, 2021, and approval of the performance results associated with the awards similarly took place on January 27, 2021.

Restricted Stock Units. In 2020, the Company granted time-based RSUs to the NEOs. Time-based RSU grants align participant interests directly with shareholders and are intended to increase executive beneficial share ownership, focus the efforts of executives on improving long-term stock price performance, and strengthen retention of participants through a three-year vesting period.

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Equity-based grants are generally considered and granted annually in January by the Compensation Committee. Mr. Cox makes recommendations for each NEO (other than himself) to the Compensation Committee which retains full discretion to set the grant amount. In determining the type and size of a grant to an executive officer, the Compensation Committee generally considers, among other things:

Company and individual performance;
The executive officer’s current and expected future contributions to the Company;
Effect of a potential award on total compensation and pay philosophy;
Internal pay equity relationships;
Competitive market data;
Potential dilutive impact on shareholders and available share pool; and
Size and potential value of recent equity grants outstanding.

Equity grants were made to executives at the Compensation Committee’s January 2020 meeting and NEO grants were allocated 50/50 between Performance Shares and time-based RSUs. In 2020, the Compensation Committee increased equity award amounts for each of the executive officers based on individual performance, contributions to the Company and competitive positioning relative to market levels.

2020 Equity Awards for NEOs

Annual Equity Award

NEO

    

Performance Shares

    

Time-Based RSUs

    

Total Equity Value

Matthew J. Cox

$

1,325,000

$

1,325,000

$

2,650,000

Joel M. Wine

$

400,000

$

400,000

$

800,000

Ronald J. Forest

$

400,000

$

400,000

$

800,000

Peter T. Heilmann

$

350,000

$

350,000

$

700,000

John P. Lauer

$

350,000

$

350,000

$

700,000

Combination of Total Direct Pay Elements: The Company’s combination of pay elements for its NEOs is designed to place the emphasis on incentive compensation, while at the same time focusing on long-term talent retention and maintaining a balanced program to ensure an appropriate relationship between pay and risk. The Compensation Committee believes this is consistent with one of its key compensation objectives, which is to align management and shareholder interests.

Percentage of Target Total Direct Compensation Provided by Each Pay Element for 2020

2020 Pay Elements

NEO

    

Salary

    

Annual Incentives

    

Long-Term Incentives

Matthew J. Cox

20%

20%

60%

Joel M. Wine

32%

22%

46%

Ronald J. Forest

32%

22%

46%

Peter T. Heilmann

30%

21%

49%

John P. Lauer

30%

21%

49%

Retirement Benefits: Matson provides various benefit plans to meet the retirement needs of all employees, including NEOs. Retirement plans are an important part of the Company’s total compensation program designed to provide executives with the ability to plan for their future while keeping them focused on Matson’s present success. The Pension Benefits for 2020 table of this Proxy

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Statement provides a more detailed description and estimated values for each NEO related to the Retirement Plan for Employees of Matson and Matson Excess Benefits Plan. The basic objective of these plans is to provide long-term eligible employees with retirement benefits proportional to their cash-based compensation from Matson.

The Matson, Inc. 401(k) and Profit Sharing Plan for Non-Bargaining Employees: The Company has a tax-qualified defined contribution retirement plan (the “401(k) Plan”) available to most non-bargaining unit employees which includes a cash-based profit sharing incentive component with an award of zero to three percent of eligible base salary. This component provides for discretionary contributions to participants’ retirement savings account of up to three percent of compensation based on the degree of achievement of consolidated EBITDA as established in the Company’s annual Board-approved Operating Plan. The resulting payout percentage for 2020 was three percent. The 401(k) component of the 401(k) Plan provides for a match of the compensation deferred by a participant during the fiscal year. The matching contribution for 2020 applicable to most participants, including all of the NEOs, was 100% of a participant’s deferrals up to three percent of eligible compensation. The value of the Company’s 2020 401(k) matching contributions for NEOs is included in the Summary Compensation Table of this Proxy Statement.

Retiree Health and Welfare Plan: The Company provides NEOs with the same retiree medical and life insurance benefits as are provided in general to all salaried non-bargaining unit employees. These benefits are limited to only those employees (including NEOs) who joined the Company prior to January 1, 2008. These benefits aid in retaining long-term service employees by providing a fixed dollar contribution towards the monthly premium based on the employee’s age and years of service.

Perquisites: The Company provides limited perquisites to the NEOs. These perquisites include Company-provided parking and reimbursement for spousal travel to certain Company events.

Severance Plan and Change in Control Agreements: The Company maintains the Matson Executive Severance Plan (the “Severance Plan”) that covers each of the NEOs. The Company has entered into change in control agreements (“Change in Control Agreements”) with all NEOs to retain talent during transitions due to a change in control of the ownership of the Company or other covered event, and to provide a competitive pay package. Change in Control Agreements promote the continuation of management to ensure a smooth transition. The Compensation Committee designed the agreements to provide a competitively structured program, and yet be conservative overall in the amounts of potential benefits. The Compensation Committee’s decisions regarding other compensation elements are affected by the potential benefits under these arrangements, as the Compensation Committee considers how the terms of these arrangements and the other pay components interrelate. These agreements and the Severance Plan are described in further detail in the “Other Potential Post-Employment Payments” section of this Proxy Statement.

CEO Pay Ratio

The Dodd-Frank Wall Street Reform and Consumer Protection Act requires the Company to disclose the CEO to median employee pay ratio. The methodology management applied to determine the median employee and pay ratio is consistent with past practice and in accordance with the SEC’s guidance pursuant to Item 402(u) of Regulation S-K as detailed below.

For 2020, Matson identified the median employee using total taxable wages as reported in Box 1 of the W-2 for all employees employed on December 31, 2020. This population of 2,561 employees includes all full-time, part-time and on-call regular employees and seagoing personnel. As the Company’s total combined employee population in China (97 employees) and New Zealand

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(21 employees) totaled less than five percent, these foreign pay levels were excluded from the process used to determine the median employee. For full-time, part-time and on-call employees hired in 2020, total taxable wages were annualized for the year.

In determining the Summary Compensation Table amount of pay for both Mr. Cox and the median employee, management employed the same methodology used for NEOs as set forth in the 2020 Summary Compensation Table of this Proxy Statement. The Company’s contribution to employee health plans was also included. As illustrated below, using the Total Pay amounts, Matson’s 2020 CEO to median employee pay ratio is 47:1.

CEO to Median Employee Pay Ratio

    

Summary Compensation
Table Amount

 + 

Company Contributions
to Health Plans

 = 

Total Pay

CEO

$

5,477,333

    

$

29,735

    

$

5,507,068

Median Employee

$

102,110

$

14,312

$

116,422

Tax and Accounting Considerations

In evaluating the compensation structure, the Compensation Committee considers tax and accounting treatment, balancing the effects on the individual and the Company. The Compensation Committee considers, among other items, deductibility of executive compensation, as limited by Section 162(m) of the Internal Revenue Code, which generally disallows a tax deduction for compensation in excess of $1 million paid to certain executive officers. The Tax Cuts and Jobs Act of 2017 repealed the performance-based exception to the deduction limit for compensation that is deductible in tax years commencing after December 31, 2017. However, certain compensation is specifically exempt from the deduction limit under a transition rule to the extent that it is “performance based” as defined in Section 162(m) and subject to a “written binding contract” in effect as of November 2, 2017 that is not later modified in any material respect. Even though performance awards granted to executives in 2020 are not eligible for the former exception from the deduction limitations of Section 162(m), the Company remains committed to tying the compensation of its executives to the performance of the Company. The 2017 amendments to Section 162(m) did not have any meaningful impact on the design of the Company’s executive compensation programs, and they are not expected to have any meaningful impact in future years.

Policies and Practices

Share Ownership Guidelines: To enhance shareholder alignment and ensure commitment to longer-term decision-making that enhances shareholder value, the Company has share ownership guidelines. Executives are required to own a value of stock equal to the salary multiple below within a five-year period:

Position

    

Salary Multiple

Chairman & CEO

5X

Other NEOs

3X

All NEOs have met their respective share ownership requirements.

Equity Granting Policy: Equity awards are typically granted to current employees at the January Compensation Committee meeting, and the meeting is generally scheduled on the fourth Wednesday of the month. Equity grants for new hires or promoted employees are approved at regularly scheduled

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Compensation Committee meetings, which meetings are scheduled approximately 8-12 months in advance of the meeting date. The timing of these grants is made without regard to anticipated earnings or other major announcements by the Company. For any outstanding stock options granted by the Company, the exercise price for stock option grants is the closing price on the date of the grant.

Policy Regarding Speculative Transactions and Hedging: The Company has adopted a formal policy prohibiting directors, officers and employees from (i) entering into speculative transactions, such as trading in options, warrants, puts and calls or similar instruments involving Matson stock, or (ii) hedging or monetization transactions involving Matson stock.

Policy Regarding Recoupment of Certain Compensation: The Company has adopted a formal “clawback” policy for senior management, including all NEOs. Pursuant to such policy, the Company will seek to recoup certain incentive compensation, including cash bonuses and equity awards based upon the achievement of financial performance metrics, from executives in the event that the Company is required to restate its consolidated financial statements.

Compensation Committee Report

The Compensation Committee has reviewed and discussed the CD&A section of this Proxy Statement with management and, based on these discussions and review, it has recommended to the Board of Directors that the CD&A disclosure be included in this Proxy Statement.

The foregoing report is submitted by Mr. Fukunaga (Chair), Ms. Ching and Mr. Kuriyama.

Compensation Committee Interlocks and Insider Participation

No member of the Compensation Committee is, or was during or prior to fiscal 2020, an officer or employee of the Company or any of its subsidiaries. During fiscal 2020, none of the Company’s executive officers served as a director or member of the compensation committee of another entity where an executive officer of such other entity serves or served as a director or member of the Compensation Committee of the Company. See “Certain Relationships and Transactions” on page 21 for a description of certain transactions between Matson and Foodland, where Ms. Wall serves as Chairman and Chief Executive Officer, and owns more than 10% of the common stock. Ms. Wall served on the Company’s Compensation Committee in 2020.

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Summary Compensation Table

The following table summarizes the compensation paid by Matson to the NEOs in 2020, 2019 and 2018:

2020 SUMMARY COMPENSATION TABLE

Change in

Pension Value

and

Nonqualified

Non-Equity

Deferred

Stock

Option

Incentive Plan

Compensation

All Other

Name and

Salary

Bonus

Awards

Awards

Compensation

Earnings

Compensation

Total

Principal Position

   

Year

   

($)

   

($)

   

($)(1)

   

($)(2)

   

($)(3)

   

($)(4)

   

($)

   

($)

(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

(j)

Matthew J. Cox

2020

689,276  

(5) 

2,662,521 

(6) 

1,669,271 

362,244 

94,021 

(7) 

5,477,333 

Chairman and Chief

2019

813,119 

2,484,702 

781,600 

301,308 

94,306 

4,475,035 

Executive Officer

2018

789,436 

2,511,612 

1,122,856 

47,396 

93,299 

4,564,599 

Joel M. Wine

2020

479,081 

(5) 

803,814 

(6)

760,771 

69,404 

40,349 

(7)

2,153,419 

Executive Vice President and

2019

527,399 

596,326 

344,405 

167,398 

23,963 

1,659,491 

Chief Financial Officer

2018

512,037 

602,794 

524,710 

47,521 

39,400 

1,726,462 

Ronald J. Forest

2020

478,075 

(5) 

803,814 

(6)

720,449 

135,702 

40,666 

(7)

2,178,706 

President

2019

526,290 

596,326 

339,503 

180,704 

24,485 

1,667,308 

2018

510,962 

602,794 

516,849 

37,871 

1,668,476 

Peter T. Heilmann

2020

382,460 

(5) 

703,367 

(6)

584,391 

50,213 

35,044 

(7)

1,755,475 

Executive Vice President, Chief Administrative

2019

421,032 

496,993 

287,754 

106,765 

26,535 

1,339,079 

Officer and General Counsel

2018

408,769 

502,360 

419,969 

38,026 

33,856 

1,402,980 

John P. Lauer

2020

383,150 

(5) 

703,367 

(6)

578,275 

79,822 

35,181 

(7)

1,779,795 

Executive Vice President and

2019

373,666 

496,993 

241,541 

93,920 

21,719 

1,227,839 

Chief Commercial Officer

2018

362,783 

502,360 

340,089 

24,863 

31,297 

1,261,392 


(1)Represents the grant date fair value of time-based RSUs and the grant date fair value of Performance Shares (assuming the target level of performance is attained) for the fiscal year identified in column (b).
(2)No stock option grants were made in 2018, 2019 or 2020.
(3)Represents the NEO’s actual award under the CIP for the fiscal year identified in column (b) payable in cash in February of the following year.
(4)All amounts are attributable to the aggregate change in the actuarial present value of the NEO’s accumulated benefit under all defined benefit and actuarial pension plans.
(5)Reflects temporary salary reduction from May 1, 2020 through November 30, 2020.
(6)Includes the grant date fair value of Performance Shares at target of $1,337,493 for Mr. Cox, $403,789 each for Mr. Wine and Mr. Forest, and $353,330 each for Mr. Heilmann and Mr. Lauer. The grant date fair value of these Performance Share awards at maximum are $3,343,733 for Mr. Cox, $1,009,472 each for Mr. Wine and Mr. Forest, and $883,325 each for Mr. Heilmann and Mr. Lauer.
(7)Represents dividends paid on unvested time-based RSUs, the Company’s contributions to the 401(k) and profit sharing plan.

Grants of Plan-Based Awards

The following table contains information concerning the equity and non-equity grants under Matson’s incentive plans during 2020 for the NEOs:

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2020 GRANTS OF PLAN-BASED AWARDS

All Other

Grant

Stock

Date Fair

Awards:

Value of

Estimated Possible Payouts

Estimated Future Payouts

Number of

Stock

Under Non-Equity Incentive

Under Equity Incentive

Shares of

And

Plan Awards(1)

Plan Awards(2)

Stock or

Option

Grant

Threshold

Target

Maximum

Threshold

Target

Maximum

Units

Awards

Name

   

Date

   

($)

   

($)

   

($)

   

(#)

   

(#)

   

(#)

   

(#)(3)(4)

   

($)(5)

(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

(l)

Matthew J. Cox

422,066 

844,132 

1,688,263 

— 

— 

— 

— 

— 

1/22/2020

— 

— 

— 

6,317 

33,690 

84,225 

— 

1,337,493 

1/22/2020

— 

— 

— 

— 

— 

— 

33,690 

1,325,028 

Joel M. Wine

191,630 

383,260 

766,520 

— 

— 

— 

—