UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
KVH Industries, Inc.
(Name of Issuer)
Common Stock
(Title of Class of Securities)
482738101
(CUSIP Number)
James C. Roumell
Roumell Asset Management, LLC
2 Wisconsin Circle, Suite 660
Chevy Chase, MD 20815
(301) 656-8500
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 27, 2007
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rules 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box. |_|
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
- --------------------- -----------------
CUSIP No. 482738101 Page 2 of 7 Pages
- --------------------- -----------------
- -------------------------------------------------------------------------------
1 Name of Reporting Person/
I.R.S. Identification No. of Above Person (Entities Only)
Roumell Asset Management, LLC
52-2145132
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2 Check the Appropriate Box if a Member of a Group (a) |_|
(b) |_|
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
3 SEC Use Only
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
4 Source of Funds (See Instructions) OO
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
6 Citizenship or Place of Organization Maryland
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Number of 7 Sole Voting Power 0
Shares -------------------------------------------------------
Beneficially -------------------------------------------------------
Owned by Each 8 Shared Voting Power 1,246,000*
Reporting -------------------------------------------------------
Person With -------------------------------------------------------
9 Sole Dispositive Power 1,246,000*
-------------------------------------------------------
-------------------------------------------------------
10 Shared Dispositive Power 0
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person 1,246,000
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares |_|
(See Instructions) Not Applicable
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11) 8.31%**
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
14 Type of Reporting Person IA
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
* The 1,246,000 shares are deemed to be owned beneficially by Roumell Asset
Management, LLC solely as a result of its discretionary power over such shares
as investment adviser. Roumell Asset Management has no economic interest in
these shares and thus disclaims beneficial ownership thereof.
** The denominator is based on 14,996,261 shares of common stock outstanding as
of May 7, 2007, as stated on the facing page of the Form 10-Q for the quarter
ended March 31, 2007 (the "Form 10-Q") filed by KVH Industries, Inc.
- --------------------- -----------------
CUSIP No. 482738101 Page 3 of 7 Pages
- --------------------- -----------------
- -------------------------------------------------------------------------------
1 Name of Reporting Person/
I.R.S. Identification No. of Above Person (Entities Only)
James C. Roumell
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2 Check the Appropriate Box if a Member of a Group (a) |_|
(b) |_|
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
3 SEC Use Only
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
4 Source of Funds (See Instructions) PF
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
5 Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
6 Citizenship or Place of Organization United States
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Number of 7 Sole Voting Power 4,500
Shares -------------------------------------------------------
Beneficially -------------------------------------------------------
Owned by Each 8 Shared Voting Power 0
Reporting -------------------------------------------------------
Person With -------------------------------------------------------
9 Sole Dispositive Power 4,500
-------------------------------------------------------
-------------------------------------------------------
10 Shared Dispositive Power 0
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
4,500
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
12 Check if the Aggregate Amount in Row (11) Excludes Certain Shares |_|
(See Instructions) Not Applicable
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
13 Percent of Class Represented by Amount in Row (11) *
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
14 Type of Reporting Person IN
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
* Less than 1%. The denominator is based on 14,996,261 shares of common stock
outstanding as of May 7, 2007, as stated on the facing page of the Form 10-Q.
- --------------------- -----------------
CUSIP No. 482738101 Page 4 of 7 Pages
- --------------------- -----------------
Item 1. Security and Issuer.
This Schedule 13D relates to the common stock of KVH Industries, Inc.
(the "Issuer"). The principal executive office of the Issuer is 50 Enterprise
Center, Middletown, Rhode Island 02842.
Item 2. Identity and Background.
This joint statement on Schedule 13D is being filed by Roumell Asset
Management, LLC and by James C. Roumell (each, a "Reporting Person").
Roumell Asset Management is organized as a Maryland limited liability
company. Its principal address, and address of its principal business, is
2 Wisconsin Circle, Suite 660, Chevy Chase, Maryland 20815. Roumell Asset
Management is a registered investment adviser.
Mr. Roumell's home address is 3516 Raymond Street, Chevy Chase,
Maryland 20815. Mr. Roumell's present principal occupation is acting as the
President of Roumell Asset Management, a registered investment adviser, whose
address is set forth above.
During the last five years, none of the Reporting Persons have been
convicted in any criminal proceeding (excluding traffic violations and similar
misdemeanors). During the last five years, none of the Reporting Persons have
been a party to any civil proceeding of a judicial or administrative body of
competent jurisdiction which resulted in or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any
violations with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
Roumell Asset Management directed client accounts as to which it had
discretionary authority to purchase, for the clients' benefit and in the
clients' names (or in street names), 1,246,000 shares of common stock of the
Issuer. The aggregate purchase price was $12,194,734, inclusive of brokerage
commissions. The sources of funding for these purchases were individual client
funds. Mr. Roumell purchased 4,500 shares of common stock for a purchase price
of $44,984.90, inclusive of brokerage commissions. The source of funding for
these purchases was funds in a retirement account.
Item 4. Purpose of Transaction.
The Reporting Persons acquired shares of the common stock of the
Issuer for investment purposes, based on their belief that the Issuer's stock
is undervalued and represents an attractive investment opportunity. The
Reporting Persons may attempt to discuss matters directly with the Issuer's
management and board of directors or may propose matters directly to the
Issuer's stockholders, in each case regarding factors contributing to the
current undervaluation of the Issuer's stock and new strategies to create and
maximize value for the Issuer's stockholders. Accordingly, the Reporting
Persons sent a letter, dated June 27, 2007, to the Chairman of the Issuer's
board of directors and the Issuer's chief executive officer. A copy of this
letter is being filed with this Schedule 13D as Exhibit 7.02 and is
incorporated herein by this reference.
The Reporting Persons intend to regularly review their equity
interest in the Issuer. Depending upon their review, one or more of the
Reporting Persons may from time to time purchase additional securities of the
Issuer, dispose of all or a portion of the securities then beneficially owned
by such Reporting Person, or cease buying or selling such securities. Any
such additional purchases or sales of securities of the Issuer may be in the
open market or privately negotiated transactions or otherwise.
Depending on their assessment of the foregoing factors, the Reporting
Persons may, from time to time, modify their present intention as stated in
this Item 4.
- --------------------- -----------------
CUSIP No. 482738101 Page 5 of 7 Pages
- --------------------- -----------------
Except as set forth above, the Reporting Persons do not have at this
time any specific plans which would result in (a) the acquisition by the
Reporting Persons of additional securities of the Issuer or the disposition by
the Reporting Persons of securities of the Issuer; (b) any extraordinary
corporate transactions such as a merger, reorganization or liquidation
involving the Issuer or any of its subsidiaries; (c) any sale or transfer of a
material amount of the assets of the Issuer or of any of its subsidiaries; (d)
any change in the present management or board of directors, including any plans
or proposals to change the number or term of directors or to fill any existing
vacancies on the board of directors; (e) any material change in the present
capitalization or dividend policy of the Issuer; (f) any other material change
in the Issuer's business or corporate structure; (g) any change in the
Issuer's charter or bylaws which may impede the acquisition of control of the
Issuer by any person; (h) the Issuer's common stock being delisted from a
national securities exchange or ceasing to be authorized to be quoted in an
inter-dealer quotation system or a registered national securities association;
(i) causing a class of equity securities of the Issuer to become eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934; or (j) any action similar to those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) See Items 11 and 13 of the cover pages of this Schedule 13D, which
Items are incorporated herein by reference, for the aggregate number of shares
and percentage of common stock owned by each of the Reporting Persons.
(b) See Items 7, 8, 9 and 10 of the cover pages to this Schedule 13D,
which Items are incorporated herein by reference, for the aggregate number of
shares of common stock beneficially owned by each of the Reporting Persons as
to which there is sole or shared power to vote or direct the vote and sole or
shared power to dispose or to direct the disposition of such shares of common
stock.
The 1,246,000 shares are deemed to be owned beneficially by
Roumell Asset Management solely as a result of its discretionary power over
such shares as investment adviser. Roumell Asset Management has no economic
interest in these shares and thus disclaims beneficial ownership thereof.
The percentage of the common stock set forth for each Reporting
Person in this Item 5 was calculated based upon 14,996,261 shares of common
stock outstanding as of May 7, 2007, as stated on the facing page of the
Issuer's Form 10-Q for the quarter ended March 31, (2007).
(c) During the 60-day period ended June 27, 2007, Roumell Asset
Management conducted the following transactions in the Issuer's common stock.
Each of the below listed transactions was a purchase and was conducted in the
ordinary course of business on the open market for cash. Purchase prices
exclude brokerage commissions paid.
Date No. of Shares Purchase Price
05/01/07 1,300 $9.4700
05/02/07 1,300 $9.5254
05/11/07 1,700 $9.5800
05/14/07 3,750 $9.4400 - $9.5300
05/15/07 800 $9.4600
05/18/07 1,700 $9.2900 - $9.3300
05/22/07 500 $9.2200
05/23/07 200 $9.2000
05/24/07 500 $9.2400
05/29/07 250 $9.2922
06/04/07 250 $9.2960
- --------------------- -----------------
CUSIP No. 482738101 Page 6 of 7 Pages
- --------------------- -----------------
06/06/07 1,300 $9.1969
06/07/07 700 $9.1300 - $9.1700
06/11/07 1,450 $9.1400
06/13/07 2,400 $8.8516
06/18/07 31,700 $8.5794 - $8.8300
06/20/07 10,100 $8.9800 - $8.9900
06/21/07 29,800 $8.9400
06/22/07 37,750 $8.9400 - $8.9697
06/25/07 19,350 $8.9126 - $9.0027
06/26/07 28,400 $8.8381 - $8.8900
Mr. Roumell did not have any transactions in the Issuer's common stock
during the 60-day period ended June 27, 2007.
(d) Roumell Asset Management's advisory clients have the right to
receive or direct the receipt of dividends from, or the proceeds from the sale
of, the 1,246,000 shares of the Issuer's common stock. Mr. Roumell has the
right, through his retirement account, to receive dividends from,
or the proceeds from the sale of, the 4,500 shares of the Issuer's common stock.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
The Investment Advisory Agreement between Roumell Asset Management
and its clients for whom Roumell Asset Management conducted the acquisition of
the subject shares provides that Roumell Asset Management has shared authority
to vote and discretionary authority to dispose of securities such as the
subject shares. A copy of the form of Investment Advisory Agreement is being
filed as Exhibit 7.01 with this Schedule 13D and is incorporated herein by this
reference.
Item 7. Material to be Filed as Exhibits.
Exhibit 7.01 Form of Roumell Asset Management, LLC Investment Advisory
Agreement.
Exhibit 7.02 Letter to Board of Directors of KVH Industries, Inc.
dated June 27, 2007.
Exhibit 7.03 Joint Filing Agreement by and among the Reporting Persons,
dated June 28, 2007.
- --------------------- -----------------
CUSIP No. 482738101 Page 7 of 7 Pages
- --------------------- -----------------
SIGNATURES
After reasonable inquiry and to the best of his or its knowledge and
belief, each of the undersigned Reporting Persons certifies that the
information set forth in this statement with respect to him or it, as
applicable, is true, complete and correct.
Date: June 28, 2007 By: /s/ James C. Roumell
----------------------------------
James C. Roumell
Roumell Asset Management, LLC
Date: June 28, 2007 By: /s/ James C. Roumell
---------------------------------
James C. Roumell, President
Exhibit 7.01
Roumell Asset Management, LLC
Investment Advisory Agreement
This Investment Advisory Agreement, the ("Agreement"), dated as of
______________, 20____, is by and between Roumell Asset Management, LLC
("Adviser"), also referred to as "RAM" or the "Firm," an investment adviser
registered with the U.S. Securities and Exchange Commission pursuant to the
provisions of the Investment Advisers Act of 1940 ("Advisers Act") and
_____________________________________________ ("Client").
1. Services of Adviser
By execution of this Agreement, Client hereby establishes an Investment
Advisory Account ("Account") and appoints Adviser as the investment manager to
supervise and direct the investments of the Account on a discretionary basis in
accordance with the Client's stated objectives and financial goals. In
consultation with the client, Roumell Asset Management will assist the client in
determining whether the account is to be managed as an: (a) Equity Account (up
to 100% invested into stocks), or (b) Concentrated Equity Account (up to 100%
invested into roughly 20 stocks), or (c) Balanced Account (with the typical
balanced account having a 65% target equity allocation and a 35% target for
fixed-income securities). That said, RAM does not provide comprehensive
financial planning services. Moreover, in those instances where a financial
planning professional introduces the client to RAM, the financial planning
professional will determine (with the client) the appropriate overall investment
strategy of the client and will instruct RAM as to whether the account is to be
managed as an: (a) Equity Account, or (b) Concentrated Equity Account, or (c)
Balanced Account. Investments made by RAM may include mutual funds, closed-end
fund shares, bonds, common and preferred stocks, American Depository Receipts
("ADR"), Exchange Traded Funds ("ETF"), Unit Investment Trusts ("UIT"), and/or
Real Estate Investment Trusts ("REIT"). The custodian holding the Account will
be responsible for providing regular statements to the client showing portfolio
holdings. On a quarterly basis, these statements will include a category titled
"Performance Summary".
2. Standard of Care
In providing such services, it is agreed that except for negligence, malfeasance
or violation of applicable law, neither Adviser nor any of its officers,
directors or employees shall be liable for any action performed or for any
errors of judgment in managing client's account(s) under this Agreement.
However, the Federal Securities Laws impose liabilities under certain
circumstances and therefore nothing contained in this Agreement with respect to
liabilities should be construed as limiting a client's rights which he/she may
have under applicable state or Federal Securities Laws, or, if applicable ERISA.
Client expressly understands and agrees that Adviser does not guarantee that a
specific result will be achieved through Adviser's management of the Account.
3. Custody
As a condition of opening an account with RAM, client agrees to deposit his or
her funds and securities in a securities brokerage account at Raymond James
Financial Services, Inc. ("Raymond James"). Raymond James will act as the
custodian of the client's assets and will execute the purchase and sale
transactions in the client's account. RAM has determined that the fees Raymond
James charges are reasonable and competitive in view of the quality of execution
and access to research that Raymond James provides. Raymond James charges a flat
$25 (unlimited shares) per stock trade (listed or OTC); $0 per bond trade
(unlimited number of bonds); and $14.95 per mutual fund trade for non-platform
listed mutual funds. Nevertheless, RAM may execute trades through other
broker-dealers if the circumstances warrant, i.e., to gain access to other
firms' research. In such instances, clients will typically pay five cents per
share in addition to Raymond James' transaction cost. Such trades are unusual
and not the norm. Finally, in limited cases, and always at RAM's discretion, RAM
may permit clients to direct that their assets be custodied at, and trades for
their accounts be effected through, broker-dealers of their own choosing.
4. Confidential Relationship
All information and advice furnished by either party to the other, including
their respective agents and employees, shall be treated as confidential and
shall not be disclosed to third parties, except as required by law or necessary
to carry out designated powers or as granted by the Client.
5. Service to Other Clients
It is understood that Adviser performs investment advisory services for other
clients. Client agrees that Adviser may give advice and take action with respect
to any of its other clients, which may differ from the advice given or the
timing or nature of action taken with respect to the Client's Account, so long
as it is Adviser's policy to the extent practical, to allocate investment
opportunities to the Account over a period of time on a fair and equitable basis
relative to other clients.
6. Proxies and Class Action Lawsuits
RAM does not vote proxies for or make proxy recommendations to its advisory
clients except in certain situations. First, RAM will vote on proposals
regarding closed-end mutual funds that seek to open-end such funds or other
proposals that it believes possess a meaningful likelihood of substantially
closing the discount to such funds' net asset value (NAV). Additionally, RAM may
vote company proposals when the proposal pertains to a change of control. Client
may contact RAM to obtain information about how it voted. Other than these
specific situations, RAM will not vote company proxies. RAM also will not take
any action or render any advice involving legal matters, including securities
class actions, on behalf of clients with respect to securities or other
investments held in client accounts or the issuers thereof. The custodians who
hold securities on behalf of RAM's clients will send proxy and class action
information directly to the clients. In the event that RAM receives any such
material on a client's behalf, RAM will promptly forward that material to the
client. A copy of RAM's proxy voting policies and procedures is available upon
request.
7. Fees
RAM's fees are payable quarterly in advance and are based on the following
annualized fee schedule:
First $200,000 1.75%
Next $300,000 1.50%
Assets over $500,000 1.00%
Fees are computed based on the value of the account on the last day of the
preceding quarter. The fee is prorated for a partial quarter. Multiple
household accounts are aggregated for purposes of determining the appropriate
fee. Adviser and Raymond James are hereby authorized to deduct from Client's
Account any fee owed to Adviser pursuant to the terms of this Agreement, and
pay said fee to Adviser or its designee. All fees paid to Adviser will be
reported to Client on the regular statements provided by Raymond James &
Associates for Raymond James Financial Services, Inc. Alternatively, client
will be billed directly by RAM and agrees to pay their fee within 30 days of
receiving the bill.
8. Limitation of Responsibility
Raymond James' responsibility pursuant to this agreement is limited to executing
transactions pursuant to directions of Adviser or Client. Client authorizes
Adviser to act as Client's agent to buy or sell investments for the Client's
Account.
9. Investment Objectives and Restrictions
Client acknowledges that Adviser will rely on information provided to Adviser by
the Client (or financial planning professional) in managing the Account. Client
agrees to give Adviser prompt written notice of any modifications, changes or
investment restrictions applicable to the Account and to notify Adviser if
Client deems any investments recommended or made for the Account to be in
violation of such investment objectives or restrictions. Unless Client promptly
notifies Adviser in writing of specific investment restrictions on the Account,
the investments recommended for or made on behalf of the Account shall be deemed
to be in conformity with Client's investment objectives. Although tax
considerations are not generally a factor in managing accounts, it is the
Client's responsibility to notify Adviser if such considerations are relevant to
the Client's overall financial circumstances.
10. Authority to Contract
If the client is not an individual (i.e. a corporation, partnership, trust or
retirement plan), the party executing on behalf of the Client (hereinafter
referred to as the "Authorized Person") represents that he or she is fully
authorized to execute this agreement with the Adviser.
11. Termination of Agreement
This Agreement may not be modified or amended except in writing and signed by
both Adviser and Client. Client may terminate the Agreement within five days of
the date of acceptance, without penalty. After the five-day period, either party
may terminate the Agreement on 30 days written notice to the other party. Upon
termination, any prepaid fees will be pro-rated to the date of termination and
any unearned portion thereof will be refunded to the Client.
12. Assignment of Agreement
No assignment, as that term is defined in the Advisers Act, of this Agreement
shall be made by Adviser without the written consent of Client.
13. Notices
Notices to Adviser must be in writing, and shall be sent to Address of Adviser.
All notices or communications to the Client will be sent to the address of
record on the account or such other address as may be given in writing to the
Adviser. All notices hereunder shall be sufficient if delivered by facsimile,
regular or overnight mail, or by hand.
14. Acknowledgment of Adviser's ADV Part II
Client hereby acknowledges receipt of a copy of Part II of Adviser's Form ADV
and Privacy Notice.
15. Governing Law
The internal law of Maryland will govern this agreement. However, nothing in
this agreement will be construed contrary to the Advisers Act or any rule or
order of the Securities and Exchange Commission under the Advisers Act.
16. Severability
The parties hereby agree that if any term, provision, duty, obligation or
undertaking herein contained is held to be unenforceable or in conflict with
applicable law, the validity of the remaining portions shall not be affected,
and the rights and obligations of the parties shall be construed and enforced as
if such invalid or unenforceable provision was not contained herein.
Type of Account:
Balanced: These accounts are composed of equity, fixed income and cash
investments. This option is typically chosen when the account
represents a significant percentage of a client's overall
financial net worth or for those clients who desire a lower
overall risk level as compared to a straight equity account. On
average, balanced accounts hold between 25 and 30 stocks
(representing 65% of the total portfolio) with the remaining
portion of the account in fixed income and cash.
Equity: These accounts can have up to 100% of assets invested in stocks,
although they may also include certain types of fixed income
investments. Equity accounts typically hold between 30 and 35
stocks. A more concentrated strategy is available where accounts
typically hold about 20 stocks. Equity accounts are designed for
those who wish to maximize our equity investment strategy while
assuming a commensurate level of risk.
____ Balanced:
___ Standard (65/35 Equity/Fixed Income & Cash)
___ Other ( )
____ Equity
____ Concentrated Equity
Investment Restrictions: ___________________________________________________
Link this Account with Related Accounts: __________ ___________ __________
Investment Experience
(Circle: N-None, L-Limited, M-Moderate, E-Extensive)
Equities N L M E
Bonds N L M E
Options/Futures N L M E
Mutual Funds N L M E
Annuities N L M E
Margin Trading N L M E
Investment Objective and
Associated Risk Tolerance Time Horizon
Capital Preservation __ Low __ < 5 years
Income __ Low __ Medium __ High __ 5-10 years
Growth __ Medium __ High __ > 10 years
Speculation __ High
Accepted: Date: ______________________________
By: ________________________________ __________________________________
Client Name Client Signature
By: ________________________________ __________________________________
Client Name Client Signature
By: ________________________________ __________________________________
Adviser Title
Exhibit 7.02
[Roumell Asset Management Letterhead]
June 27, 2007
KVH Industries, Inc.
Board of Directors
50 Enterprise Center
Middletown, RI 02842-5279
Attention:
Arent H. Kits van Heyningen, Chairman of the Board
Martin A. Kits van Heyningen, Chief Executive Officer
We currently own 1,246,000 shares of KVH Industries, Inc. stock, or roughly 8.3%
of outstanding shares. We are impressed with the company's history of technology
innovation, its multiple commercial end-market opportunities as well as its
defense business, particularly with the emergence of remote controlled weapons
systems. The company has long been conservatively managed; and we appreciate
that aspect of its history as well.
Although truly strategic opportunities should not be overlooked, it would be
hard for us to imagine a more compelling acquisition opportunity than
repurchasing KVHI stock at a price below $10/share. Given the menu of commercial
products (serving the marine, RV and automobile markets), and the emergence of
new applications for the company's gyroscopes because of the CROWS program and
others like it, we feel the company's plate is full and that the opportunities
for organic growth are plentiful.
We respectively urge the Board to seriously weigh any acquisition idea against
the very compelling investment opportunity presented by buying back KVH stock at
current levels. To wit, we note the following valuation metrics: 40%+ of market
capitalization is represented by cash; the enterprise value to sales ratio is
less than 1x; and free-cash flow is positive while overall commercial business
continues to improve and new defense programs provide reason for optimism. In
our view, KVHI common stock is a compelling investment that would be hard to
duplicate.
Sincerely,
/s/ James C. Roumell
James C. Roumell
Roumell Asset Management, LLC
Exhibit 7.03
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(k) under the Securities Exchange Act of 1934,
as amended, the undersigned hereby agree to the joint filing on behalf of each
of them this Schedule 13D (including further amendments thereto) with respect to
the common stock, par value $0.01 per share, of KVH Industries, Inc., and that
this Joint Filing Agreement be included as an exhibit to such joint filing.
This Joint Filing Agreement may be executed in one or more counterparts,
and each such counterpart shall be an original but all of which, taken together,
shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the undersigned hereby execute this Joint Filing
Agreement as of this 28th day of June 2007.
By: /s/ James C. Roumell
--------------------------------
James C. Roumell
ROUMELL ASSET MANAGEMENT, LLC
By: /s/ James C. Roumell
--------------------------------
James C. Roumell, President