HENNESSY ADVISORS INC

Hennessy Advisors, Inc. (the “Company”) was founded on* February 1, 1989,as a California corporation under the name Edward J. Hennessy, Incorporated. In1990,* the Company became a registered investment advisor, and on* April 15, 2001,*the Company changed its name to Hennessy Advisors, Inc.

The Company’s operating activities consist primarily of providing investment advisory services to 16 open-end mutual funds andone exchange‑traded fund (“ETF”) branded as the Hennessy Funds. The Company serves as the investment advisor to all classes of the Hennessy Cornerstone Growth Fund, the Hennessy Focus Fund, the Hennessy Cornerstone Mid Cap30 Fund, the Hennessy Cornerstone Large Growth Fund, the Hennessy Cornerstone Value Fund, the Hennessy Total Return Fund, the Hennessy Equity and Income Fund, the Hennessy Balanced Fund, the Hennessy Energy Transition Fund, the Hennessy Midstream Fund, the Hennessy Gas Utility Fund, the Hennessy Japan Fund, the Hennessy Japan Small Cap Fund, the Hennessy Large Cap Financial Fund, the Hennessy Small Cap Financial Fund, and the Hennessy Technology Fund (collectively, the “Hennessy Mutual Funds”), as well as to the Hennessy Sustainable ETF. The Company also provides shareholder services to investors in the Hennessy Mutual Funds.

The Company’s operating revenues consist of contractual investment advisory and shareholder service fees paid to it by the Hennessy Funds. The Company earns investment advisory fees from each Hennessy Fund by, among other things:

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The Company earns shareholder service fees from Investor Class shares of the Hennessy Mutual Funds by, among other things, maintaining a toll‑free number that the current investors in the Hennessy Funds* may*call to ask questions about their accounts and actively participating as a liaison between investors in the Hennessy Funds and U.S. Bank Global Fund Services.

Investment advisory and shareholder service fee revenues are earned and calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services and are subsequently reviewed by management.

The Company recognizes revenues when its obligations related to the investment advisory and shareholder services are satisfied, and it is probable that a significant reversal of the revenue amount wouldnot occur in future periods. Management judgment is required in assessing the probability of significant revenue reversal and in identification of distinct services. Investment advisory and shareholder services are performed over time because investors in the Hennessy Funds are receiving and consuming the benefits as they are provided by the Company. Fees are based on contractual percentages of net asset values of each Hennessy Fund and recognized for services provided during the period, which are distinct from services provided in other periods. Such fees are affected by changes in net asset values, including market appreciation or depreciation, foreign exchange translation, and net inflows or outflows of the Hennessy Funds. Assets under management represent the broad range of financial assets the Company manages for the Hennessy Funds on a discretionary basis pursuant to investment management and shareholder servicing agreements that are expected to continue for at least12 months. In general, reported assets under management reflect the valuation methodology that corresponds to the basis used for determining revenue. The fees are computed and billed monthly, at which time they are recognized in accordance with Accounting Standards Codification606 — Revenue from Contracts with Customers.

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The Company waives a portion of its fees with respect to the Hennessy Midstream Fund, the Hennessy Technology Fund, and the Hennessy Sustainable ETF to comply with contractual expense ratio limitations. The fee waivers are calculated daily by the Hennessy Funds’ accountants at U.S. Bank Global Fund Services, reviewed by management, and then charged to expense monthly as offsets to the Company’s revenues. Each waived fee is then deducted from investment advisory fee income and reduces the aggregate amount of advisory fees the Company receives from such fund in the subsequent month. To date, the Company has only waived fees based on contractual obligations, but the Company has the ability to waive fees at its discretion. Any decision to waive fees would apply only on a going‑forward basis.

The Company’s contractual agreements for investment advisory and shareholder services prove that a contract exists with fixed and determinable fees, and the services are rendered daily. The collectability is deemed probable because the fees are received from the Hennessy Funds in the month subsequent to the month in which the services are provided.

Cash and cash equivalents include all cash balances and highly liquid investments with original maturities ofthree months or less that are readily convertible into cash.

The Financial Accounting Standards Board (“FASB”) guidance on “Disclosures about Fair Value of Financial Instruments” requires disclosures regarding the fair value of all financial instruments for financial statement purposes. The estimates presented in these financial statements are based on information available to management as of the end of fiscal years2025 and2024. Accordingly, the fair values presented in the Company’s financial statements as of the end of fiscal years2025 and2024 * may**not* be indicative of amounts that could be realized on disposition of the financial instruments. The fair value of receivables, accounts payable, and notes payable has been estimated at carrying value due to the short maturity of these instruments. The fair value of marketable securities and money market accounts is based on closing net asset values as reported by securities exchanges registered with the SEC.

Investments in highly‑liquid financial instruments with remaining maturities of less thanone year are classified as short-term investments. Financial instruments with remaining maturities of greater thanone year are classified as long‑term investments. A table of investments is included in Note3 in this Item8, “Financial Statements and Supplementary Data.”

The Company holds investments in publicly traded mutual funds, which are accounted for as trading securities. Accordingly, unrealized gains and losses of less than $1,000 per year were recognized in operations for fiscal years2025 and2024.

Dividend income is recorded on the ex‑dividend date. Purchases and sales of marketable securities are recorded on a trade‑date basis, and realized gains and losses recognized on sale are determined on a specific identification/average cost basis.

Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally betweenone andten years.

Throughout its history, the Company has completed 12 purchases of the assets related to the management of 33 different investment funds, some of which were reorganized into already existing Hennessy Funds. In accordance with FASB guidance, the Company periodically reviews the carrying value of its management contract asset to determine if any impairment has occurred. Although a quantitative analysis of the fair value of the management contract asset wasnot required, management performed a high-level analysis for internal purposes only. The fair value of the management contract asset was estimated as of the end of fiscal years2025 and2024 by applying the income approach and was based on management estimates and assumptions, includingthird-party valuations that utilize appropriate valuation techniques. The analysis further supported that there wasno “more-likely-than-not” impairment trigger as of such dates.

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Under Accounting Standards Codification350 — Intangibles - Goodwill and Other, intangible assets that have indefinite useful lives arenot amortized but are tested at least annually for impairment. The Company considered various factors, such as likelihood of continued renewal, whether there are foreseeable limits on net cash flows, and whether the Company is dependent on a limited number of investors, in determining the useful life of the management contracts. After consideration of factors discussed, the Company considers the management contract asset to be an intangible asset with an indefinite useful life andno impairment as of the end of fiscal year2025.

The Company completed its most recent asset purchases on* November 10, 2023,and February 23, 2024,when it purchased assets related to the management of the CCM Small/Mid-Cap Impact Value Fund and the CCM Core Impact Equity Fund (each, a “CCM Fund”), respectively. These asset purchases added approximately $12 million and $59 million to the Company’s assets under management at the time of closing with respect to the CCM Small/Mid-Cap Impact Value Fund and the CCM Core Impact Equity Fund, respectively. Each purchase was consummated in accordance with the terms and conditions of that certain Transaction Agreement, dated as of April 26, 2023,between the Company and Community Capital Management, LLC. Upon completion of each transaction, the assets of the applicable CCM Fund were reorganized into the Hennessy Sustainable ETF. In fiscal year2024,* the Company capitalized $1.0 million in purchase price and other costs for the purchase of assets related to the management of the CCM Funds.

On* March14,* 2025, the Company announced it had signed a definitive agreement with STF Management, LP to purchase the assets related to the management of the STF Tactical Growth & Income ETF (Nasdaq: TUGN) and the STF Tactical Growth ETF (Nasdaq: TUG) (together, the “STF ETFs”). The definitive agreement includes customary representations, warranties, and covenants of the parties to the agreement, including approval of the shareholders of each STF ETF. Upon completion of the transaction, which is subject to the approval of the shareholders of each STF ETF, the assets of the STF Tactical Growth & Income ETF and the STF Tactical Growth ETF will be reorganized to become series of Hennessy Funds Trust named the Hennessy Tactical Growth and Income ETF and the Hennessy Tactical Growth ETF, respectively. The Company expects to complete the transaction in* December2025.* In fiscal year2025, the Company capitalized $0.3 million in costs related to the transaction.

The Company, under the FASB guidance on “Accounting for Uncertainty in Income Tax,” uses a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company’s income tax return and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company utilizes atwo-step approach for evaluating uncertain tax positions. Thefirst step, recognition, requires the Company to determine if the weight of available evidence indicates that a tax position is more likely thannot to be sustained upon audit, including resolution of related appeals or litigation processes, if any. Thesecond step, measurement, is based on the largest amount of benefit that is more likely thannot to be realized on ultimate settlement.

The Company believes the positions taken on its tax returns are fully supported, but tax authorities* maychallenge these positions and they may**not* be fully sustained on examination by the relevant tax authorities. Accordingly, the income tax provision includes amounts intended to satisfy assessments that* mayresult from these challenges. Determining the income tax provision for these potential assessments and recording the related effects requires management judgement and estimates. The amounts ultimately paid on resolution of an audit could be materially different from the amounts previously included in the income tax provision and, therefore, could have a material impact on the Company’s income tax provision, net income, and cash flows. The accrual for uncertain tax positions is attributable primarily to uncertainties concerning the tax treatment of the Company’s domestic operations, including the allocation of income among different jurisdictions. For a further discussion on taxes, refer to Note12* in this Item8, “Financial Statements and Supplementary Data.”

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The Company is subject to income tax in the U.S. federal jurisdiction and various state jurisdictions. The Company’s U.S. federal income taxes for2019 through 2023 remain open and subject to examination. For state tax jurisdictions with unfiled tax returns, the statutes of limitations remains open indefinitely.

Basic earnings per share is determined by dividing net earnings by the weighted average number of shares of common stock outstanding, while diluted earnings per share is determined by dividing net earnings by the weighted average number of shares of common stock outstanding adjusted for the dilutive effect of common stock equivalents, which consist of restricted stock units (“RSUs”).

Amended and Restated2024 Omnibus Incentive Plan

Effective as of* February 8, 2024,the Company adopted, and the Company’s shareholders approved, the2024* Omnibus Incentive Plan (the “Omnibus Plan”), which provides for the issuance of options, stock appreciation rights, restricted stock, RSUs, performance awards, and other equity awards for the purpose of attracting and retaining executive officers, key employees, and outside directors and advisors and increasing shareholder value. The Omnibus Plan replaced the Amended and Restated2013 Omnibus Incentive Plan. Under the Omnibus Plan, participants* may*be granted RSUs, among other awards, each of which represents an unfunded, unsecured right to receive a share of the Company’s common stock on the dates specified in the recipient’s award. The Company issues new shares of its common stock when it is required to deliver shares to an RSU recipient. The RSUs granted under the Omnibus Plan vest over four years at a rate of 25% per year. The Company recognizes stock-based compensation expense on a straight line basis over thefour-year vesting term of each award, and accounts for forfeitures as they occur.

The compensation committee of the Company’s Board of Directors has the authority to determine the awards granted under the Omnibus Plan, including among other things, the individuals who receive the awards, the times when they receive them, vesting schedules, performance goals, whether an option is an incentive or nonqualified option, and the number of shares to be subject to each award.

The Omnibus Plan contains change of control provisions whereby, among other things, all outstanding RSUs and other securities issued under the Omnibus Plan will vest immediately upon the occurrence of the following events constituting a change of control of the Company: (i) an acquisition, in anyone transaction or series of transactions, after which any individual, entity or group has beneficial ownership of 50% or more of either the then outstanding shares of the common stock or combined voting power of the Company’s then outstanding voting securities, but excluding an acquisition (A) by the Company or any of its employee benefit plans (or related trusts), (B) by Neil J. Hennessy or any affiliate, or (C) by any corporation which, following the acquisition, is beneficially owned, directly or indirectly, in substantially the same proportions, by the beneficial owners of the common stock and voting securities of the Company immediately prior to such acquisition, (ii)50% or more of the members of the Company’s Board of Directors (A) arenot continuing directors, or (B) are nominated or elected by the same beneficial owner or are elected or appointed in connection with an acquisition of the Company, or (iii) the (A) consummation of a reorganization, merger, share exchange, consolidation or similar transaction, with respect to which the beneficial owners of the Company immediately prior to such transaction donot, following such transaction, beneficially own more than 50% of the then outstanding shares of common stock and voting securities of the corporation resulting from the transaction, (B) consummation of the sale or other disposition of all or substantially all of the assets of the Company or (C) approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.

All compensation costs related to RSUs vested during fiscal years2025 and2024 have been recognized in the financial statements.

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The Company has available up to 3,671,300 shares of the Company’s common stock in respect of granted stock awards, in accordance with terms of the Omnibus Plan.

A summary of RSU activity is as follows:

Additional information related to RSUs is as follows:

Dividend Reinvestment and Stock Purchase Plan

In* January**2024,* the Company adopted an updated Dividend Reinvestment and Stock Purchase Plan (the “DRSPP”), replacing the previous Dividend Reinvestment and Stock Purchase Plan that had been in place since2021. The DRSPP provides shareholders and new investors with a convenient and economical means of purchasing shares of the Company’s common stock and reinvesting cash dividends paid on the Company’s common stock. Under the DRSPP and its predecessor plan, the Company issued 16,572 and 12,902 shares of common stock in fiscal years2025 and2024, respectively. The maximum number of shares that* maybe issued under the DRSPP is 1,530,000, of which 1,513,428 shares remained available for issuance as of September 30, 2025*.

Stock Buyback Program

In* August2010,* the Company’s Board of Directors adopted a stock buyback program pursuant to which the Company was authorized to repurchase up to 1,500,000 shares of its common stock in the open market, in privately negotiated transactions, or otherwise. The program doesnot have an expiration date. In* August2022,* the Board of Directors increased the number of shares that* maybe repurchased under the program to 2,000,000 shares. A total of 1,096,368 shares remain available for repurchase under the stock buyback program. The Company didnot repurchase any shares of its common stock pursuant to the stock buyback program during fiscal year2025*.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

The Company determines its reporting units in accordance with FASB ASC280, “Segment Reporting” (“ASC280”). The Company evaluates a reporting unit byfirst identifying its operating segments under ASC280. The Company then evaluates each operating segment to determine if it includesone or more components that constitute a business. If there are components within an operating segment that meet the definition of a business, the Company evaluates those components to determine if they must be aggregated intoone or more reporting units. If applicable, when determining if it is appropriate to aggregate different operating segments, the Company determines if the segments are economically similar and, if so, the operating segments are aggregated.

The Company operates inone business segment, which is its investment advisory business. The investment advisory segment derives revenues from the Hennessy Funds by managing the composition of each fund’s portfolio, monitoring each fund’s compliance with its investment objectives, reviewing each fund’s investment performance, overseeing service providers, and preparing and distributing regulatory reports. The determination of a single business segment is consistent with the financial information regularly provided to the Company’s chief operating decision maker (“CODM”), and included consideration of factors such as revenue coming from a single source (investment advisory fees generated by the Hennessy Funds) and the Company utilizing the same technology, marketing, sales, and distribution programs to support all of the Hennessy Funds. The Company’s CODM is the President and COO, who reviews and evaluates the line items disclosed in the income statement as presented in the accompanying statements of income for purposes of assessing performance, making operating decisions, allocating resources, and planning and forecasting for future periods. The key measure of segment profitability that the CODM uses to allocate resources and assess performance is consolidated net income, as reported on the statement of income.

The CODM doesnot regularly review disaggregated expense categories beyond those presented in the accompanying statements of income. The measure of segment assets is reported in the accompanying balance sheets as “Total assets.” Expenditures for long-lived assets are reported as “Purchases of property and equipment” on the statements of cash flows for the fiscal years ended2025 and2024.”

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The Company applies Accounting Standards Codification820 — Fair Value Measurement for all financial assets and liabilities, which establishes a framework for measuring fair value and expands disclosures about fair value measurements. The standard defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” It also establishes a fair value hierarchy consisting of the followingthree levels that prioritize the inputs to the valuation techniques used to measure fair value:

Based on the definitions, the following table represents the Company’s assets categorized in the Level1 to Level3 hierarchies:

There wereno transfers between levels during fiscal years2025 or2024.

The fair values of receivables, payables, and accrued liabilities approximate their book values given the short-term nature of those instruments.

The fair value of the2026 Notes (see Note9 in this Item8, “Financial Statements and Supplementary Data”) was approximately $40.1 million as of* September 30, 2025*, based on the last trading price of the notes on that date (Level1). The Company didnot elect to apply the fair value option to the carrying value of the2026 Notes under Accounting Standards Codification825 — Financial Instruments.

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The cost, gross unrealized gains, gross unrealized losses, and fair market value of the Company’s trading investments were as follows:

The mutual fund investments are included as a separate line item in current assets on the Company’s balance sheets.

The following table summarizes the Company’s property and equipment balances:

The following useful lives are assigned to fixed assets: furniture isseven years, equipment isthree years, and software ranges fromone tothree years. During fiscal year2025 and2024, depreciation expense was $0.3 million and $0.2 million, respectively.

The costs related to the Company’s purchase of assets related to management contracts are capitalized as incurred and comprise the management contract asset. This asset was $82.6 million as of the end of fiscal year2025, an increase of $0.3 million from the end of fiscal year2024. The increase was related to costs associated with the definitive agreement signed with STF Management, LP. The Company considers the management contract asset to be an intangible asset per Accounting Standards Codification350 — Intangibles – Goodwill and Other. The purchase costs that comprise the management contract asset include consideration to the seller, as well as legal and similar external transaction costs.

The Company has investment advisory agreements with Hennessy Funds Trust under which it provides investment advisory services to all classes of the 17 Hennessy Funds.

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The investment advisory agreements must be renewed annually (except in limited circumstances) by (a) the Funds’ Board of Trustees or the vote of a majority of the outstanding shares of the applicable Hennessy Fund and (b) the vote of a majority of the trustees of Hennessy Funds Trust who arenot interested persons of the Hennessy Funds. If an investment advisory agreement isnot renewed, it terminates automatically. There aretwo additional circumstances in which an investment advisory agreement terminates. First, an investment advisory agreement automatically terminates if the Company assigns it to another advisor (assignment includes “indirect assignment,” which is the direct or indirect transfer of the Company’s common stock in sufficient quantities deemed to constitute a controlling block). Second, an investment advisory agreement* may*be terminated prior to its expiration upon 60 days’ written notice by either the applicable Hennessy Fund or the Company.

As provided in each investment advisory agreement, the Company receives investment advisory fees monthly based on a percentage of the applicable fund’s average daily net asset value.

The Company has entered into sub-advisory agreements for the Hennessy Focus Fund, the Hennessy Equity and Income Fund, the Hennessy Japan Fund, the Hennessy Japan Small Cap Fund, and the Hennessy Sustainable ETF. Under each of these sub-advisory agreements, the sub‑advisor is responsible for the investment and reinvestments of the assets of the applicable Hennessy Fund in accordance with the terms of such agreement and the applicable Hennessy Fund’s Prospectus and Statement of Additional Information. The sub‑advisors are subject to the direction, supervision, and control of the Company and the Funds’ Board of Trustees. The sub‑advisory agreements must be renewed annually (except in limited circumstances) in the same manner as, and are subject to the same termination provisions as, the investment advisory agreements.

In exchange for the sub-advisory services, the Company (not the Hennessy Funds) pays sub-advisory fees to the sub-advisors out of its own assets. Sub‑advisory fees are calculated as a percentage of the applicable sub‑advised fund’s average daily net asset value.

The Company determines if an arrangement is an operating lease at inception. Operating leases are included in operating lease right‑of‑use assets and current and long‑term operating lease liabilities on the Company’s balance sheet. There wereno long‑term operating leases as of* September30,* 2023. During the quarter ended* March31,* 2024, the Company renewed the lease for its office in Novato, California for an additional three years. The renewed lease will expire on* July 31, 2027.The renewal created a long‑term operating lease asset recorded during the quarter ended March 31, 2024.There wereno other long‑term operating leases as of September 30, 2025.*

Upon renewal of the lease for its office in Novato, California, the Company recorded a right‑of‑use asset of $1.1 million on its balance sheet. Right‑of‑use assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease right‑of‑use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date. The Company’s lease terms* mayinclude options to extend the lease when it is reasonably certain that it will exercise any such options. For its leases, the Company concluded that it isnot* reasonably certain that any renewal options would be exercised, and, therefore, the amounts arenot recognized as part of operating lease right‑of‑use assets or operating lease liabilities. Leases with initial terms of12 months or less, and certain office equipment leases that are deemed insignificant, arenot recorded on the balance sheet and are expensed as incurred and included within rent expense under general and administrative expense. Lease expense related to operating leases is recognized on a straight-line basis over the expected lease terms.

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The Company’s most significant leases are real estate leases of office facilities. The Company leases office space under non-cancelable operating leases. Its principal executive office is located in Novato, California, and it has additional offices in Austin, Texas, Dallas, Texas, Boston, Massachusetts, and Chapel Hill, North Carolina. Only the office lease in Novato, California has been capitalized because the other operating leases have terms of12 months or less, including leases that are month‑to‑month in nature. Other supplemental cash flow information, lease term, and discount rate is as follows for the years ended* September 30, 2025and2024:*

For fiscal years2025 and2024, the Company’s lease payments for amounts included in the measurement of operating lease liabilities totaled $0.39 million and $0.41 million, respectively, and total rent expense for all offices, which is recorded under general and administrative expense in the statements of income, totaled $0.53 million and $0.56 million, respectively.

The undiscounted cash flows for future maturities of the Company’s operating lease liabilities and the reconciliation to the balance of operating lease liabilities reflected on the Company’s balance sheet are as follows:

Details relating to the accrued liabilities and accounts payable reflected on the Company’s balance sheet are as follows:

On* October**20,* 2021, the Company completed a public offering of 4.875% notes due2026 in the aggregate principal amount of $40,250,000 (the*“2026* Notes”), which included the full exercise of the underwriters’ overallotment option. The initial net proceeds received were approximately $38,607,000 after considering the impact of issuance costs and underwriter discounts. The2026 Notes bear interest at 4.875% per annum, payable on the last day of each calendar quarter and at maturity, beginning* December 31, 2021.The effective interest rate, which reflects the amortization of issuance costs over the term of the loan, during both fiscal years2025* and2024 was 5.7%. Total interest expense for both fiscal years2025 and2024 comprises $2.0 million of contractual interest and $0.3 million related to the amortization of debt issuance costs. The2026 Notes mature on* December 31, 2026.*

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The2026 Notes are direct unsecured obligations, rank equally in right of payment with any of the Company’s future unsecured unsubordinated indebtedness, senior to any of the Company’s future indebtedness that expressly provides that it is subordinate to the2026 Notes, effectively subordinate to all of the Company’s future secured indebtedness, and structurally subordinate to all future indebtedness and other obligations of any of the Company’s future subsidiaries.

In addition to the operating leases discussed in Note7 in this Item8, “Financial Statements and Supplementary Data,” the Company has contractual expense ratio limitations in place with respect to the Hennessy Midstream Fund, the Hennessy Technology Fund, and the Hennessy Sustainable ETF. Such contractual expense ratio limitations will expire* February 28, 2026,unless extended. Total fees waived during fiscal years2025* and2024 were $0.20 million and $0.18 million, respectively. To date, the Company has only waived fees based on contractual obligations but has the ability to waive fees at its discretion. Any decision to waive fees would apply only on a going forward basis.

In* November 2024,the Company entered into a settlement agreement with respect to employment-related claims made by a former employee in fiscal year2024.* The Company believed the settlement provided for an efficient and effective resolution to the matter. The Company has employment practices liability insurance for such claims, and therefore paid the amount of the settlementnot covered by the employment practices liability insurance.

The Company hasno other commitments andno significant contingencies with original terms in excess ofone year.

The Company has a401(k) retirement plan covering eligible employees. Employees are eligible to participate if they are over21 years of age and have completed a minimum ofone month of service with at least80 hours worked in that month. The Company also made discretionary profit-sharing contributions of $0.2 million in each of the fiscal years2025 and2024. To be eligible for the discretionary profit-sharing contribution, an employee must be eligible to participate in the401(k) retirement plan and must complete at least501 hours of service during the calendar year or be employed as of the last day of the calendar year.

As of the end of each of fiscal years2025 and2024, the Company’s gross liability for unrecognized tax benefits related to uncertain tax positions was $0.4 million and $0.4 million, respectively. If the tax benefits of such amounts were recognized, $0.3 million and $0.3 million of such amounts, respectively, would decrease the Company’s effective income tax rate. As of* September 30, 2025*, and* September 30, 2024*, the Company’s net liability for accrued interest and penalties was $0.4 million and $0.3 million, respectively. The Company has elected to recognize interest and penalties related to unrecognized tax benefits as a component of income tax expense. The Company recognized approximately $0.05 million in interest and penalties during each of the years ended* September 30, 2025*, and* September 30, 2024*.

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A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

The total amount of unrecognized tax benefits can change due to final regulations, audit settlements, tax examinations activities, lapse of applicable statutes of limitations, and the recognition and measurement criteria under the guidance related to accounting for uncertainly in income taxes. The Company is unable to estimate what this change could be within the next12 months, but doesnot believe it would be material to its financial statements.

On* July 4, 2025,the “One Big Beautiful Bill Act” (OBBBA) was signed into law. The OBBBA contains a broad range of provisions affecting businesses, including provisions related to bonus depreciation, research and development expensing, a favorable change for calculating the business interest deduction limitation under Section163*(j), and modifications to certain international rules. The impacts of the OBBBA arenot anticipated to be material to the Company based on current operations, however the Company will continue to evaluate any future impacts to the consolidated financial statements.

The Company’s income tax expense was as follows:

The principal reasons for the differences from the federal statutory income tax rate and the Company’s effective tax rate were as follows:

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The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities were as follows:

The weighted average common shares outstanding used in the calculation of basic earnings per share and weighted average common shares outstanding, adjusted for common stock equivalents, used in the computation of diluted earnings per share were as follows:

For fiscal years2025 and2024, the Company excluded 32,190 and 162,315 common stock equivalents, respectively, from the diluted earnings per share calculations because they werenot dilutive. In each case, the excluded common stock equivalents consisted of non-vested RSUs.

The Company maintains its cash accounts withthree commercial banks that, at times,* mayexceed federally insured limits. The amount on deposit at September 30, 2025*, exceeded the insurance limits of the Federal Deposit Insurance Corporation by approximately $5.4 million. In addition, total cash and cash equivalents include $66.5 million held in the First American U.S. Government Money Market Fund that isnot federally insured. The Company believes it isnot exposed to any significant credit risk on cash and cash equivalents.

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In* November 2023,FASB issued ASU2023*-07, “Segment Reporting (Topic280): Improvements to Reportable Segment Disclosures,” which requires public companies to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis that are regularly provided to the CODM, as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. ASU2023-07 requires that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources. The guidance is effective for fiscal years beginning after* December 15, 2023,including interim periods within those fiscal years, which means that it will be effective for the Company’s annual periods beginning September 1, 2024,and its interim periods beginning September 1, 2025.The Company adopted the ASU2023*-07 and determined that its adoption didnot have a material impact on the Company’s financial statements and related disclosures.

In* December 2023,the FASB issued ASU2023*-09, “Income Taxes (Topic740): Improvements to Income Tax Disclosures,” which requires more detailed income tax disclosures. The guidance requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as expanded information on income taxes paid by jurisdiction. The guidance is effective for financial statements issued for annual periods beginning after* December 15, 2024,with early adoption permitted. The Company is required to adopt this standard prospectively in fiscal year2026.* The Company is currently in the process of evaluating the impact of adoption on its financial statements.

In* November 2024,the FASB issued ASU2024*-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic220-40): Disaggregation of Income Statement Expenses,” as amended by ASU2025-01, which requires public business entities to disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. In particular, this amendment requires public business entities to disclose detailed information about specific costs that are presented in commonly referred expense captions, such as general and administrative expenses. The guidance is effective for financial statements issued for annual reporting periods beginning after* December 15, 2026,and interim reporting periods within annual reporting periods beginning after December 15, 2027.*Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption on its financial statements.

There have beenno other significant changes to the Company’s critical accounting policies and estimates during fiscal year2025.

The short and long-term implications of Russia’s invasion of Ukraine and Hamas’ attack against Israel are difficult to predict. Because of the highly uncertain and dynamic nature of these events, their impact on the Company’s business, financial condition, or operating results cannot be reasonably estimated at this time.

As of* December 3, 2025*, the filing date of this Annual Report on Form10‑K, management evaluated the existence of events occurring subsequent to the end of fiscal year2025, and determined the following to be a subsequent event:

On* October 29, 2025,the Company announced a quarterly cash dividend of $0.1375 per share paid on November 26, 2025,to shareholders of record as of November 12, 2025.The declaration and payment of dividends to holders of the Company’s common stock, if any, are subject to the discretion of the Company’s Board of Directors. The Company’s Board of Directors will take into account such matters as general economic and business conditions, the Company’s strategic plans, the Company’s financial results and condition, contractual, legal, and regulatory restrictions on the payment of dividends by the Company, and such other factors as the Company’s Board of Directors may*consider relevant.