Business Description

Hennessy Advisors, Inc. (the “Company,” “we,” “us,” or “our”) is a publicly traded investment management firm whose primary business activity is providing investment advisory services to a family of 16 open-end mutual funds (collectively, the “Hennessy Mutual Funds”) and one exchange‑traded fund (“ETF”) branded as the Hennessy Funds. We are committed to providing superior service to investors and employing a consistent and disciplined approach to investing based on a buy‑and‑hold philosophy that rejects the idea of market timing. Our goal is to provide products that investors can have confidence in, knowing their money is invested as promised and with their best interests in mind. Our firm was founded on these principles over 35 years ago, and the same principles guide us today. We earn revenues primarily by providing investment advisory services to the Hennessy Funds and secondarily by providing shareholder services to investors in the Hennessy Mutual Funds. Investment advisory services include managing the composition of each fund’s portfolio (including the purchase, retention, and disposition of portfolio securities in accordance with each fund’s investment objectives, policies, and restrictions), monitoring each fund’s compliance with its investment objectives and restrictions and federal securities laws, monitoring the liquidity of each fund, reviewing each fund’s investment performance, overseeing the selection and continued employment of sub-advisors and monitoring such sub-advisors’ adherence to the fund’s investment objectives, policies, and restrictions, overseeing other service providers, maintaining in‑house marketing and distribution departments, preparing and distributing regulatory reports, and overseeing distribution of the funds through third‑party financial institutions. Shareholder services include maintaining a toll‑free number that the current investors in the Hennessy Funds may call to ask questions about their accounts or the funds and actively participating as a liaison between investors in the Hennessy Funds and U.S. Bank Global Fund Services, the Hennessy Funds’ administrator. The fees we receive for investment advisory and shareholder services are calculated as a percentage of the average daily net asset values of the Hennessy Funds. Accordingly, our total revenue increases or decreases as our average assets under management rises or falls. The percentage amount of the investment advisory fees varies from fund to fund, but the percentage amount of the shareholder service fees is consistent across all Hennessy Mutual Funds. We have delegated the day‑to‑day portfolio management responsibilities to sub‑advisors, subject to our oversight, for some of the Hennessy Funds. In exchange for these sub‑advisory services, we pay each sub‑advisor a fee out of our own assets, which is calculated as a percentage of the average daily net asset values of the sub‑advised funds. Accordingly, the sub‑advisory fees we pay increase or decrease as our average assets under management in our sub‑advised funds increases or decreases, respectively. Our average assets under management for fiscal year 2025 was $4.5 billion, and our total assets under management as of the end of fiscal year 2025 was $4.2 billion. Our business strategy centers on (i) organic growth through our marketing, sales, and distribution efforts and (ii) growth through strategic purchases of management‑related assets. HISTORICAL CALENDAR YEAR TIMELINE 1989 In February, we were founded as a California corporation under our previous name, Edward J. Hennessy, Inc., and registered as a broker-dealer with the Financial Industry Regulatory Authority. 1996 In March, we launched our first mutual fund, the Hennessy Balanced Fund. 1998 In October, we launched our second mutual fund, the Hennessy Total Return Fund. 2000 In June, we successfully completed our first asset purchase by purchasing the assets related to the management of two mutual funds previously managed by Netfolio, Inc. (“Netfolio”) and changed the fund names to the Hennessy Cornerstone Growth Fund and the Hennessy Cornerstone Value Fund. The amount of the purchased assets as of the closing date totaled approximately $197 million. 1 Table of Contents 2002 In May, we successfully completed a self-underwritten initial public offering of our stock by raising $5.7 million at an offering price of $1.98 (HNNA.OB) and changed our firm name to Hennessy Advisors, Inc.…