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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 ý

Filed by a Party other than the Registrant o

Check the appropriate box:

o
 
Preliminary Proxy Statement

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

ý
 
Definitive Proxy Statement

o
 
Definitive Additional Materials

o
 
Soliciting Material under Rule 14a-12

 

KVH INDUSTRIES, 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):

ý
 
No fee required.

o
 
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:
          

o
 
Fee paid previously with preliminary materials.

o
 
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:
          
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    (4)   Date Filed:
          

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LOGO

KVH Industries, Inc.
50 Enterprise Center
Middletown, RI 02842

April 26, 2019

Dear Fellow Stockholder:

We are pleased to invite you to attend the KVH 2019 Annual Meeting of Stockholders. The meeting will take place on Tuesday, June 4, 2019 at 11:00 a.m. local time in our world headquarters at 50 Enterprise Center, Middletown, Rhode Island.

Our strategy focuses on delivering superior performance and leveraging our competitive advantages in growing markets by integrating hardware, software and service in seamless ways that drive customer success. We deliver high performance mobile connectivity and inertial navigation products and services for maritime operation optimization, IoT, and crew welfare, satellite TV for leisure and land customers, and autonomous applications focused on accuracy. We intend to continue enhancing our product and service portfolio as we scale and accelerate KVH's growth. We are confident that we have in place a highly capable management team and group of directors who are well qualified to oversee the success of the business and to represent all stockholders. We believe that our current strategy will create significant long-term value for KVH stockholders.

In addition to this proxy statement, we encourage you to read our 2018 Annual Report for a more complete picture of our performance and how we are working to increase stockholder value.

Finally, we encourage you to vote – regardless of the size of your share holdings. Every vote is important, and your participation helps us do a better job of listening and acting on what matters to you as a stockholder. You can vote over the Internet, by telephone, or by mailing a completed proxy card as outlined in the accompanying proxy statement.

On behalf of all of us at KVH, we want to thank you for your continued support and ownership of KVH. I hope to see you at the annual meeting.

              Sincerely,

    
 
    
 
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Martin A. Kits van Heyningen
President, Chief Executive Officer and Chairman of the Board of Directors

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LOGO

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

Date and Time:   Tuesday, June 4, 2019 at 11:00 a.m.

Place:
 
The Offices of KVH Industries, Inc.
World Headquarters
50 Enterprise Center
Middletown, Rhode Island

Items of Business:
 
Proposal 1 : To vote upon the election of two Class II directors to a three-year term;

 
 
Proposal 2 : To approve, in a non-binding "say on pay" vote, the compensation of our named executive officers;

 
 
Proposal 3 : To ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm; and

 
 
To transact such further business as may properly come before the annual meeting or any adjournment of the meeting.

Record Date:
 
Our Board of Directors has fixed the close of business on Friday, April 5, 2019, as the record date for the determination of the stockholders entitled to receive notice of, and to vote at, the annual meeting and any adjournment of the meeting. Only stockholders of record on April 5, 2019 are entitled to receive notice of, and to vote at, the annual meeting or any adjournment of the meeting.
              By Order of the Board of Directors,

    
 
    
 
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              Felise Feingold
Secretary

    
 
    
 
April 26, 2019

YOUR VOTE IS IMPORTANT

  Mail   Telephone   Internet   In Person
               
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  Please sign and return the enclosed proxy, whether or not you plan to attend the annual meeting.   Use the toll-free telephone number on your proxy card to vote by telephone.   Visit the website noted on your proxy card to vote via the Internet.   Attend the meeting in person.

Important Notice Regarding the Availability of Proxy Materials
for the Annual Meeting of Stockholders to be Held on June 4, 2019

This proxy statement and our 2018 annual report to stockholders are available on the Internet at
www.kvh.com/annual .
You can read, print, download and search these materials at that website.
The website does not use "cookies" or other tracking devices to identify visitors.

You can obtain directions to be able to attend the meeting and vote in person at www.kvh.com/annual .

None of the information on our website or elsewhere on the Internet forms a part of this proxy statement or is
incorporated by reference into this proxy statement.

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Proxy Summary   1
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Transition to Smaller Reporting Company Disclosure
 
4
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Questions and Answers About the Annual Meeting of Stockholders and Voting
 
5
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Proposal 1 – Election of Directors
 
7
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Proposal 2 – Non-Binding "Say on Pay" Vote
 
9
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Proposal 3 – Ratification of Appointment of Independent Registered Public Accounting Firm
 
12
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Directors and Executive Officers
 
13
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Compensation of Directors and Executive Officers
 
18
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Summary Compensation Table   18
Outstanding Equity Awards   19
Director Compensation   19
Director Compensation Table   20
Outstanding Director Equity Awards   20

Equity Compensation Plans
 
21
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Security Ownership of Certain Beneficial Owners and Management
 
22
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Section 16(a) Beneficial Ownership Reporting Compliance
 
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Board of Directors and Committees of the Board
 
25
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Director Independence   25
Board Meetings   25
Board Leadership Structure   25
Risk Management   25
Board Committees   25
Director Candidates and Selection Processes   27
Corporate Governance   27
Communications with our Board of Directors   28
Code of Ethics   28
Certain Relationships and Related-Party Transactions   28

Audit Committee Report
 
30
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Principal Accountant Fees and Services
 
31
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Fees for Professional Services   31
Pre-Approval Policies and Procedures   31

Stockholder Proposals
 
32
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Available Information
 
32
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PROXY SUMMARY

The proxy summary is an overview of information that you will find elsewhere in this proxy statement and our 2018 annual report. As this section is only a summary, we encourage you to read the entire proxy statement for more information about these topics before you vote.


ANNUAL MEETING OF STOCKHOLDERS
Tuesday, June 4, 2019 at 11:00 a.m.

The Offices of KVH Industries, Inc.
World Headquarters
50 Enterprise Center
Middletown, Rhode Island


 
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VOTING MATTERS

Management Proposals   ​ Board Vote Recommendation   ​ Page  
1. Election of Directors     FOR the Nominees     7  
2. Non-Binding "Say on Pay" Vote   ​ FOR   ​ 9  
3. Ratification of Appointment of Independent Public Accounting Firm     FOR     12  
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ELECTION OF DIRECTORS

The following table provides summary information about our nominees for election to the Board as Class II Directors. Additional information for all Directors, including the nominees, may be found on pages 7-8 and 13-14.

Name   Age   Director
Since
  		Independent   Committee Membership
Martin A. Kits van Heyningen   60   1982   No   None
Charles R. Trimble   77   1999   Yes   Audit Committee
Compensation Committee
Nominating and Corporate Governance Committee
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PROXY SUMMARY

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COMMITMENT TO GOOD CORPORATE GOVERNANCE

Our Board of Directors monitors best practices in governance and adopts measures it determines to be in the best interest of stockholders. Highlights of our governance practices include:

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Our directors are elected by majority voting for three-year terms

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We have a majority of independent directors

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All of the members of our audit, compensation and nominating and corporate governance committees are independent

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We have appointed a lead independent director to serve as a liaison between our independent directors and our Chairman of the Board, who is our President and Chief Executive Officer

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Executive sessions of independent directors are held at each regularly scheduled Board meeting

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Our independent directors attended 100% of the meetings of the Board in 2018

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We rotated our independent registered public accounting firm in June 2014

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We conduct a stockholder vote to ratify the selection of our independent registered public accounting firm

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The majority of director compensation is in the form of KVH common stock

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We have a strong pay-for-performance executive compensation philosophy

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We conduct annual non-binding "say on pay" votes regarding our executive compensation program

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We do not have any executive employment agreements or change in control agreements

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Our independent compensation consultant is hired by the compensation committee

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We conduct annual board and committee self-assessments

NON-BINDING "SAY ON PAY" VOTE

We are asking our stockholders to approve, in a non-binding vote, the compensation awarded to our named executive officers for 2018. The Compensation Committee of our Board of Directors oversees our executive compensation program, which is designed to motivate our executives to increase profitability and stockholder returns, to tie pay to performance effectively, and to compete effectively for and retain managerial talent.

We are asking our stockholders to indicate their support for our named executive officer compensation. We believe that our executive compensation program was designed appropriately and is working to ensure that management's interests are aligned with our stockholders' interests to support long-term value creation.

This "say on pay" vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the compensation methodology described in this proxy statement. While this vote is advisory and not binding, the Board and the Compensation Committee will consider the outcome of the vote, along with other relevant factors, when considering future executive compensation decisions.

Additional information regarding the non-binding "say on pay" vote may be found on pages 9 to 11.

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PROXY SUMMARY

2018 EXECUTIVE COMPENSATION HIGHLIGHTS

The 2018 compensation program for our named executive officers was comprised of three primary elements – base salary, cash-based incentive compensation and annual equity grants. We believe the compensation program for our named executive officers included key features that aligned the interests of our executives with KVH's business strategies and goals and stockholders' interests.

What We Do   What We Don't Do

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Offer competitive compensation that attracts and retains executive talent

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Align the interests of our named executive officers with those of our stockholders and reward the creation of long-term value for KVH stockholders through equity grants

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Emphasize variable performance-based compensation over fixed compensation

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Align payout of annual incentives to drivers of stockholder value, such as revenue and adjusted EBITDA

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Balance the importance of achieving long-term strategic priorities and critical short-term goals linked to long-term objectives

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Align individual performance goals with our business strategy

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Cap incentive payments

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Benchmark compensation against that of a broad group of companies

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Cash and equity awards under our 2016 Equity and Incentive Plan have clawback provisions

 

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No long-term employment agreements or change of control agreements

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No guaranteed severance programs

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No tax gross-ups

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No guaranteed salary increases

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No guaranteed bonuses

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No repricing of stock options or stock appreciation rights

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No discounted stock options or stock appreciation rights


The mix of target compensation for our named executive officers for 2018 reflects these objectives, as shown in the chart. The percentages shown represent percentages of average total target compensation, not average total actual compensation, and as a result do not match the percentages calculable from actual compensation reflected in the Summary Compensation Table on page 18. Fixed pay represents the sum of salary, holiday bonus and perquisites; variable pay represents equity awards and non-equity incentive plan compensation. The chart does not reflect any discretionary bonuses. For more information on discretionary bonuses awarded in 2018, see "Proposal 2 – Non-Binding 'Say on Pay' Vote – Annual Cash-Based Incentive Compensation".   Compensation Mix

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KVH Industries, Inc. 2019 Proxy Statement         3

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PROXY SUMMARY

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For 2018, we had a non-equity incentive compensation plan intended to reward our named executive officers for achievement of corporate, business unit and individual performance goals for that year. After assessing our overall financial performance for 2018, our Compensation Committee determined not to award any non-equity incentive compensation to our named executive officers with respect to our corporate or business unit performance goals. The Compensation Committee gave consideration to discretionary bonuses paid in March 2018 to improve morale and promote the retention of certain of our named executive officers. These discretionary bonuses were approximately 8% of base salary for the chief executive officer and approximately 9% of base salary for the other named executive officer who received a discretionary bonus; the third named executive officer did not receive a discretionary bonus. Considering both these discretionary bonuses and the awards for individual performance under our 2018 non-equity incentive plan, the cash-based bonus and incentive compensation actually received by our CEO for 2018 was 30% of his base salary, rather than the targeted 90% of his base salary, and the cash-based bonus and incentive compensation actually received by our other named executives ranged from approximately 15% to 21% of their respective base salaries, rather than the targeted range of 50% to 60% of their respective base salaries.


Actual Annual Incentive Payment Versus Target
(Average Percentage of Base Salary)

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TRANSITION TO SMALLER REPORTING COMPANY DISCLOSURE

Effective in September 2018, the Securities and Exchange Commission expanded the definition of "smaller reporting company" to include, among other companies, registrants with a public float of less than $250 million on the relevant measurement date. The amendments were intended to reduce compliance costs for these companies and promote capital formation while maintaining appropriate investor protections. Smaller reporting companies generally have reduced reporting requirements relative to other registrants. For example, smaller reporting companies are relieved of requirements to provide a Compensation Discussion and Analysis, a Compensation Committee report, several executive compensation tables and pay ratio disclosures.

We currently qualify as a smaller reporting company under the revised definition and therefore fall within the group of companies intended to benefit from the regulatory relief available to smaller reporting companies. Accordingly, in preparing this proxy statement we have elected to take advantage of this relief and have omitted certain disclosures that we provided in prior years, including a Compensation Discussion and Analysis and the other disclosures noted above.

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING OF STOCKHOLDERS AND VOTING

What is the purpose of the annual meeting?

At the annual meeting, we will submit the following proposals to our stockholders:

Proposal 1   To elect two Class II directors to a three-year term.

Proposal 2
 
To approve, in a non-binding "say on pay" vote, the compensation of our named executive officers.

Proposal 3
 
To ratify the appointment of Grant Thornton LLP as our independent registered public accounting firm.

Our Board of Directors does not intend to present to the annual meeting any business other than the proposals described in this proxy statement. Our Board of Directors was not aware, a reasonable time before mailing this proxy statement to stockholders, of any other business that may be properly presented for action at the annual meeting. If any other business should come before the annual meeting, the persons present will have discretionary authority to vote the shares they own or represent by proxy in accordance with their judgment, to the extent authorized by applicable regulations.

When is the record date?

Our Board of Directors has fixed the close of business on Friday, April 5, 2019, as the record date for the annual meeting. Only stockholders of record as of the close of business on that date are entitled to receive notice of the annual meeting, and to vote at, the annual meeting. At the close of business on the record date, there were 17,851,664 shares of our common stock outstanding. Each share of common stock outstanding on the record date will be entitled to cast one vote.

What are the methods of voting?

The shares represented by your properly signed proxy card will be voted in accordance with your directions. If you do not specify a choice with respect to a proposal for which our Board of Directors has made a recommendation, the shares covered by your signed proxy card will be voted as recommended in this proxy statement. We encourage you to vote on all matters to be considered.

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By signing and returning the proxy card in the enclosed envelope, you are enabling each individual named on the proxy card (known as a "proxy") to vote your shares at the meeting in the manner you indicate. We encourage you to sign and return the proxy card even if you plan to attend the meeting. In this way, your shares will be voted even if you are unable to attend the meeting. If you received more than one proxy card, it is an indication that your shares are held in multiple accounts. Please sign and return all proxy cards to ensure that all of your shares are voted.

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To vote by telephone, please follow the instructions included on your proxy card. If you vote by telephone, you do not need to complete and mail your proxy card.

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To vote on the Internet, please follow the instructions included on your proxy card. If you vote on the Internet, you do not need to complete and mail your proxy card.

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If you plan to attend the meeting and vote in person, we will provide you with a ballot at the meeting. If your shares are registered directly in your name, you are considered the stockholder of record and you have the right to vote in person at the meeting. If your shares are held in the name of your broker or other nominee, you are considered the beneficial owner of the shares held in street name. If you wish to vote shares held in street name at the meeting, you will need to bring with you to the meeting a legal proxy from your broker or other nominee authorizing you to vote your shares.

What constitutes a quorum? What is a broker "non-vote"?

Our by-laws provide that a quorum consists of a majority of the shares of common stock outstanding and entitled to vote at the annual meeting. Shares of common stock represented by a properly signed and returned proxy (including shares properly voted by telephone or on the Internet) will be treated as present at the annual meeting for purposes of determining the existence of a quorum at the annual meeting. Abstentions and broker "non-votes" are counted as present or represented for purposes of determining the existence of a quorum at the annual meeting. A "non-vote" occurs when a broker or nominee holding shares for a beneficial owner returns a proxy but does not vote that owner's shares on a proposal because the broker or nominee does not have discretionary voting power and has not received instructions from that owner.

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KVH Industries, Inc. 2019 Proxy Statement         5

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING OF STOCKHOLDERS AND VOTING

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What vote is required for approval?

A majority of the votes properly cast at the annual meeting will be necessary to elect each Class II director to a three-year term (proposal 1), to approve, in the non-binding "say on pay" vote, the compensation of our named executed officers (proposal 2), and to approve the ratification of the appointment of Grant Thornton LLP as our independent registered public accounting firm (proposal 3). A majority of the votes properly cast at the annual meeting will be necessary to approve any other matter to be acted upon at the annual meeting. For more information on majority voting, please see "Board of Directors and Committees of the Board – Corporate Governance—Majority Voting."

What effect do abstentions and broker non-votes have?

Abstentions and broker "non-votes" will not be included in calculating the number of votes cast on any proposal. As a result, abstentions and broker "non-votes" will not have any effect on the outcome of the vote on any proposal.

Who will count the votes?

Our transfer agent, Computershare Trust Company, N.A., will separately tabulate the votes on each matter presented to the stockholders at the annual meeting.

Who is soliciting my vote? Are they paid solicitors?

We are soliciting proxies on behalf of our Board of Directors. No compensation will be paid by any person for our solicitation of proxies. We will reimburse brokers, banks and other nominees for the out-of-pocket expenses and other reasonable clerical expenses they incur in obtaining instructions from beneficial owners of our common stock. In addition to our solicitation by mail, our directors, officers and employees may make special solicitations of proxies personally or by telephone, facsimile, courier or e-mail. We expect that the expense of any special solicitation will be nominal. We will pay all expenses incurred in connection with this solicitation.

How can a proxy be revoked?

You may revoke your proxy at any time before it is voted at the meeting. In order to revoke your proxy, you must either:

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sign and return another proxy card with a later date;

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provide written notice of the revocation of your proxy to our secretary;

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if you voted by Internet or telephone, by following the instructions for revocation provided by Internet or telephone; or

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attend the meeting and vote in person.
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PROPOSAL 1 – ELECTION OF DIRECTORS

Proposal 1 concerns the election of two Class II directors for a three-year term.

Our Board of Directors currently consists of six directors and is divided into three classes. We refer to these classes as Class I, Class II and Class III. The term of one class of directors expires each year at the annual meeting of stockholders. Each director also continues to serve as a director until his or her successor is duly elected

and qualified. This year, the term of our Class II directors, Martin Kits van Heyningen and Charles R. Trimble, is expiring.

Our Nominating and Corporate Governance Committee has nominated Messrs. Kits van Heyningen and Trimble to serve as Class II directors for another three-year term. Our stockholders last elected Messrs. Kits van Heyningen and Trimble at our annual meeting of stockholders in June 2016.