"The proposed settlement, which is subject to certain conditions, including court approval, requires the Company to pay $65.0 million for claims alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934," the company said Tuesday in a filing with the Securities and Exchange Commission.
The company will pay the settlement with insurance proceeds, about $45.5 million, and company cash, about $19.5 million, the 8-K filing said. SeaWorld did not comment further on its filings.
The settlement stems from a 2014 lawsuit filed by SeaWorld investors against the company's top executives, including Jim Atchison, its CEO at the time, James Heaney, its CFO at the time, and The Blackstone Group, its investment banker. SeaWorld is based in Orlando.
The suit contends that SeaWorld deliberately misled investors about a falloff in attendance, and a resultant "6-7%" drop in revenues and "14-16%" drop in earnings that stemmed from the documentary, which CNN broadcast on Oct. 24, 2013, to 21 million viewers.
The documentary featured interviews with OSHA scientists and former SeaWorld trainers, who alleged the company mistreated its orcas, SeaWorld's famed black-and-white killer whales that perform regularly at the company's three theme parks -- in Orlando, San Diego and San Antonio.
The suit also alleges SeaWorld continued to feature Tilikum, even after the whale killed a SeaWorld trainer in Orlando in 2010 and two other people in the 1990s. The whale spent most of his life -- more than 30 years -- at SeaWorld. He died in 2017.
The suit said the mistreatment of the orcas, coupled with Tilikum's appearances, could have an adverse effect on the company's finances.
The company, when reporting the financial results of the fourth quarter of 2013 and all of 2013 in March 2014, said the decline in attendance was due to the weather and an early Easter.
But then SeaWorld issued a press release on Aug. 13, 2014, noting a drop in attendance at its theme parks along with the decline in revenues and double-digit drop in earnings. It said its attendance falloff was due to "demand pressures related to recent media attention surrounding proposed legislation in the state of California."
California legislators had proposed banning orca whales in captivity for entertainment purposes.
The 2014 press release caused the price of SeaWorld stock to plummet by 32.9 percent, to $9.25 a share. Entertainers canceled their concerts, and SeaWorld's CEO, Atchison, resigned in December 2014.
In 2016, California passed a law phasing out killer whales held in captivity in the future and set standards for those whales currently in captivity.
Since the documentary, SeaWorld ended its orca breeding program, overhauled its Shamu show cutting out orca tricks, strongly pushed its animal rescue efforts and heavily invested in animal-free attractions. SeaWorld also owns Busch Gardens.
The $65 million settlement follows a $5 million settlement that SeaWorld paid to the SEC in 2018 over the same issues.
In the first nine months of 2019, the company's most recent financial data, SeaWorld's attendance dropped by 57,000 to 17.9 million guests. Its revenues increased by $8 million to $1.1 billion, the company said during a November earnings call.