SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
HENNESSY ADVISORS, INC.
(Name of Registrant as Specified in Its Charter)
------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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[X] No fee required.
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(1) Title of each class of securities to which transaction applies:
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Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
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statement number, or the form or schedule and the date of its filing.
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[Graphic omitted]
LETTER FROM OUR PRESIDENT
AND
PROXY STATEMENT
Year Ended September 30, 2003
Hennessy Advisors, Inc.
The Courtyard Square
750 Grant Avenue, Suite 100
Novato, California 94945
800-966-5354
www.hennessy-funds.com
Dear Hennessy Advisors Shareholder: December, 2003
As I wrote last year's annual shareholder letter, we were navigating through a
very difficult and uncertain economy. What a difference a year makes and what a
year it has been for Hennessy Advisors! I believe the market is in the midst of
a sustainable recovery and will continue its positive momentum. Corporations are
experiencing stronger earnings and paying higher dividends, and businesses are
spending more -- which all should lead to higher consumer confidence and
increased investment in the stock market and in mutual funds. We grew our number
of mutual funds shareholders by 62% to over 51,000, and we more than doubled our
assets under management in our mutual funds in the past fiscal year, growing
from $374 to $835 million. Over 60% of our mutual fund asset growth was derived
from net new investments (purchases less redemptions), showing that we are
retaining existing customers and attracting new investors to our funds. In
September, we closed the acquisition of the $35 million Sym Select Growth Fund.
With that money we started the Hennessy Focus 30, a mid-cap growth fund that
employs a stock-selection formula similar to our highly successful Cornerstone
Growth Fund. Our funds are all performing nicely, led by our Hennessy
Cornerstone Growth Fund, whose year-to-date performance is +46.84% (through
12/3/03).
Here at Hennessy Advisors we take pride in bringing all of our shareholders
superior investment products. When you invest with Hennessy you are investing in
a company that is committed to providing every shareholder with investment value
and excellent service.
We are proud to report that in the past fiscal year (Oct. 1, 2002 to Sept. 30,
2003), Hennessy Advisors' revenue, net profit and earnings per share all
experienced significant increases. Total revenue increased from $2,270,287 to
$4,787,528 and net profit increased from $308,697 to $1,061,988. Diluted
earnings per share were $0.65 for the fiscal year ended September 30, 2003
versus $0.23 per share for the fiscal year ended September 30, 2002. This was an
exceptional year for our company. As the Company moves forward into our new
fiscal year (2003-2004) we are forging ahead with the goal of growing our assets
under management.
We sincerely appreciate your continued confidence and investment in our company.
We look forward to another strong year for Hennessy Advisors and a long and
successful partnership with our shareholders.
Sincerely,
/s/ Neil Hennessy
Neil Hennessy
President, Chairman and CEO
Hennessy Advisors, Inc.
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NOTICE AND PROXY STATEMENT
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 28, 2004
TO THE HOLDERS OF OUR COMMON STOCK:
The annual meeting of shareholders of Hennessy Advisors, Inc. will be
held on Wednesday, January 28, 2004, at 6:30 P.M., local time, at StoneTree
Country Club, 9 StoneTree Lane, Novato, California 94945.
The meeting will be held for the following purposes:
1. To elect eight directors to serve terms expiring at the annual
meeting of shareholders to be held in 2005 and until their
successors have been elected and qualified.
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The shareholders of record at the close of business on December 16,
2003 will be entitled to vote at the annual meeting.
We hope you will be able to attend the meeting, but in any event we
would appreciate your dating, signing and returning the enclosed proxy as
promptly as possible. If you are able to attend the meeting, you may revoke your
proxy and vote in person.
By Order of the Board of Directors,
/s/ Teresa M. Nilsen
Teresa M. Nilsen, Secretary
Dated: December 23, 2003
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004.406964.3
TABLE OF CONTENTS
Page
VOTING SECURITIES.............................................................1
ELECTION OF DIRECTORS.........................................................3
Section 16(a) Beneficial Ownership Reporting Compliance..................4
Board of Directors and Standing Committees...............................5
AUDIT COMMITTEE REPORT........................................................6
CODE OF ETHICS................................................................7
EXECUTIVE COMPENSATION........................................................7
CERTAIN TRANSACTIONS..........................................................9
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS.....................................10
OTHER MATTERS................................................................11
SHAREHOLDER PROPOSALS........................................................11
ANNUAL REPORT................................................................11
EXPENSES OF SOLICITATION.....................................................11
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HENNESSY ADVISORS, INC.
750 Grant Avenue, Suite 100
Novato, California 94945
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PROXY STATEMENT FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD JANUARY 28, 2004
This proxy statement and the enclosed form of proxy are first being
sent to shareholders of Hennessy Advisors, Inc. on or about December 23, 2003 in
connection with the solicitation by our board of directors of proxies to be used
at our 2004 annual meeting of shareholders. The meeting will be held on
Wednesday, January 28, 2004, at 6:30 P.M., local time, at StoneTree Country
Club, 9 StoneTree Lane, Novato, California 94945.
The board of directors has designated Neil J. Hennessy and Teresa M.
Nilsen, and each or either of them, as proxies to vote the shares of common
stock solicited on its behalf. If you sign and return the enclosed form of
proxy, you may nevertheless revoke it at any time insofar as it has not been
exercised by (1) giving written notice to Hennessy's Secretary, (2) delivering a
later dated proxy, or (3) attending the meeting and voting in person. The shares
represented by your proxy will be voted unless the proxy is mutilated or
otherwise received in such form or at such time as to render it not votable.
VOTING SECURITIES
The record of shareholders entitled to vote was taken at the close of
business on December 16, 2003. At such date, we had outstanding and entitled to
vote 1,626,142 shares of common stock. Each share of common stock entitles the
holder to one vote. Holders of a majority of the outstanding voting stock must
be present in person or represented by proxy to constitute a quorum at the
annual meeting.
The following table shows information relating to the beneficial
ownership as of the record date of (1) each person known to us to be the
beneficial owner of more than 5% of our voting stock, (2) each director, (3)
each of the executive officers named in the summary compensation table elsewhere
in this proxy statement, and (4) all directors and executive officers as a
group. Except as otherwise indicated, the shareholders listed exercise sole
voting and dispositive power over the shares.
Amount and Nature of Shares Beneficially Owned
Number of Shares Percent
Name(1) Owned(2) of Class
---- ----- --------
Neil J. Hennessy....................... 662,822 40.4%
Teresa M. Nilsen....................... 35,100 2.1%
Daniel B. Steadman..................... 17,500 1.1%
Henry Hansel........................... 45,000 2.7%
Brian A. Hennessy...................... 79,500 4.8%
Daniel G. Libarle...................... 25,000 1.5%
Rodger Offenbach....................... 30,170 1.8%
Thomas L. Seavey....................... 25,000 1.5%
All directors and executive officers
as a group (8 persons)............. 920,092 51.5%
------------------------
(1) The address of each individual is 750 Grant Avenue, Suite 100, Novato,
California 94945. (2) Includes shares subject to presently exercisable options,
as follows:
Name Number of Options
---- -----------------
Neil J. Hennessy..................................... 15,000
Teresa M. Nilsen..................................... 15,000
Daniel B. Steadman................................... 15,000
Henry Hansel......................................... 20,000
Brian A. Hennessy.................................... 20,000
Daniel G. Libarle.................................... 20,000
Rodger Offenbach..................................... 20,000
Thomas L. Seavey..................................... 20,000
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ELECTION OF DIRECTORS
At the meeting, eight directors will be elected to serve for a one-year
term, until their successors are elected and qualified. The board of directors
has nominated each of our current directors to stand for reelection. Directors
will be elected by a plurality of votes cast by shares entitled to vote at the
meeting. Broker non-votes and votes withheld have no effect on the outcome.
Cumulative voting does not apply unless a shareholder entitled to vote at the
meeting gives notice before the voting begins of the shareholder's intent to
exercise cumulative voting. If cumulative voting applies, each shareholder has
the right to distribute among one or more nominees the number of votes equal to
the number of directors to be elected multiplied by the number of shares that
the shareholder is entitled to vote at the meeting.
The accompanying proxy will be voted, if authority to do so is not
withheld, for the election as directors of each of the board's nominees. Each
nominee is presently available for election. If any nominee should become
unavailable, which is not now anticipated, the persons voting the accompanying
proxy may, in their discretion, vote for a substitute.
Our board of directors recommends a vote "for" the election of each of
its nominees. Proxies solicited by the board will be so voted unless
shareholders specify in their proxies a contrary choice.
Information concerning all incumbent directors and nominees, based on
data furnished by them, is set forth below.
Neil J. Hennessy (age 47) has served as director, president and chief
executive officer of Hennessy since 1989, as president and investment manager of
The Hennessy Funds, Inc. since 1996 and as director and president of Hennessy
Mutual Funds, Inc. since 2000. He is the portfolio manager to our five no-load
mutual funds. Mr. Hennessy started his financial career almost 25 years ago as a
broker at Paine Webber. He subsequently moved to Hambrecht & Quist and later
returned to Paine Webber. Mr. Hennessy has served as an expert witness/ mediator
to the securities industry since 1989, and has heard/evaluated approximately 450
cases to date, in which he has prepared, reviewed, consulted and evaluated
securities sensitive issues. Mr. Hennessy's securities industry experience is
vast. From 1987 to 1990, Mr. Hennessy served as a nominated member of the
National Association of Securities Dealers, Inc., District Business Conduct
Committee (DBCC), and in March of 1993 he accepted the nomination to this
committee again. From January 1993 to January 1995, Mr. Hennessy served his
elected term as chairman of the DBCC. Mr. Hennessy is the brother of Dr. Brian
A. Hennessy.
Teresa M. Nilsen (age 37) has served as director, executive vice
president, chief financial officer and secretary of Hennessy since 1989, as
executive vice president and secretary of The Hennessy Funds, Inc. since 1996
and as executive vice president and secretary of Hennessy Mutual Funds, Inc.
since 2000. Ms. Nilsen has worked in the securities industry for over 15 years.
Ms. Nilsen graduated with a bachelor's degree in economics from the University
of California, Davis, in 1987.
Daniel B. Steadman (age 47) has served as director and executive vice
president of Hennessy since 2000, as executive vice president of The Hennessy
Funds, Inc. since 2000 and as executive vice president of Hennessy Mutual Funds,
Inc. since 2000. Mr. Steadman has been in the financial services industry for
over 29 years, serving as vice president of WestAmerica Bank from 1995 through
2000, vice president and an organizing officer of Novato National Bank from 1984
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through 1995, assistant vice president and manager of Bank of Marin from 1980
through 1984, and banking services officer of Wells Fargo Bank from 1974 through
1980.
Henry Hansel (age 55) has served as a director of Hennessy since 2001.
Mr. Hansel attended the University of Santa Clara where he graduated in 1970
with a B.S. in economics. He is president (since 1982) of The Hansel Dealer
Group, which includes seven automobile dealerships. Mr. Hansel is a founding
director of the Bank of Petaluma.
Brian A. Hennessy (age 50) has served as a director of Hennessy since
1989, as a director of The Hennessy Funds, Inc. since 1996, and as a director of
Hennessy Mutual Funds, Inc. since 2000. Dr. Hennessy has been a self-employed
dentist for more than 20 years. Dr. Hennessy is the brother of our chairman,
Neil J. Hennessy. Dr. Hennessy attended the University of San Francisco where
he earned a B.S. in biology in 1975. Dr. Hennessy received his D.D.S. from the
University of the Pacific in 1980.
Rodger Offenbach (age 52) has served as a director of Hennessy since
2001 and a director of The Hennessy Funds, Inc. from 1996 to 2001. Mr.
Offenbach attended California State University, Sonoma where he received a B.S.
in business administration in 1972. Mr. Offenbach has been the owner of Ray's
Catering and Marin-Sonoma Picnics since 1973.
Daniel G. Libarle (age 62) has been a director of Hennessy since 2001.
Mr. Libarle attended the University of Oregon and San Jose State University,
where he graduated in 1963 with a B.A. in economics. Mr. Libarle is the owner
and president of Lace House Linen, Inc. and is a founding director and chairman
of the board of directors for Bank of Petaluma. Mr. Libarle is currently a
director of Greater Bay Bancorp and serves on the bank's audit committee.
Thomas L. Seavey (age 56) has served as a director of Hennessy since
2001. Mr. Seavey graduated from Western Michigan University with a B.A. in
English and history in 1969. For the majority of Mr. Seavey's business career,
he has been involved in the sales and marketing of athletic and leisure
products, as well as marketing professional athletes. Mr. Seavey spent 12 years
at Nike as head agent for sales in the Midwest, as well as California, and spent
three years at International Management Group as the vice president of products.
While employed at Nike, Mr. Seavey formed a family business selling sport and
leisure products in 1980, and formally took over the management of that company
in 1993, selling half the interest in it in 1998. Mr. Seavey is currently
managing Continental Sports Group (formerly Seavey Corp.)
Section 16(a) Beneficial Ownership Reporting Compliance
Under Section 16(a) of the Securities Exchange Act of 1934, a Form 4
reporting the acquisition or disposition of Hennessy equity securities by an
officer, director or 10% shareholder must be filed with the Securities and
Exchange Commission no later than the second business day after the date on
which the transaction occurred, unless certain exceptions apply. Most
transactions not reported on Form 4 must be reported on Form 5 within 45 days
after the end of the company's fiscal year. To our knowledge, based solely on a
review of copies of the reports furnished to us and written representations that
no other reports were required, our officers, directors, and greater than 10%
beneficial owners complied with all applicable Section 16(a) filing requirements
during the fiscal year ended September 30, 2003.
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Board of Directors and Standing Committees
The board held four regular meetings and one special meeting during the
fiscal year ended September 30, 2003. All directors attended at least 75% of all
meetings of the board and board committees on which they served during fiscal
2003.
The board of directors has established two standing committees: an
audit committee and a compensation committee, which are described below. Members
of these committees are elected annually at the regular board meeting held in
conjunction with the annual shareholders' meeting. Our board of directors does
not have a nominating committee.
Compensation Committee. The compensation committee presently is
composed of Rodger Offenbach (Chairman), Daniel G. Libarle and Thomas L. Seavey.
The compensation committee held one meetings during fiscal 2003 to review annual
performance. This committee has the responsibility of approving the compensation
arrangements for our management, including annual bonus and long-term
compensation. It also recommends to the board of directors adoption of any
compensation plans in which our officers and directors are eligible to
participate, as well as makes grants of employee stock options and other stock
awards under our incentive plan.
Audit Committee. The audit committee presently is composed of Daniel G.
Libarle (Chairman), Henry Hansel and Thomas L. Seavey, all of whom are
considered independent under Nasdaq rules. The audit committee met five times
during fiscal 2003. The principal responsibilities of and functions to be
performed by the audit committee are established in the audit committee charter,
which was adopted on November 6, 2002. The responsibilities and functions of the
audit committee include reviewing our internal controls and the integrity of our
financial reporting, approving the employment and compensation of and overseeing
our independent auditors, and reviewing the annual audit with the auditors.
Audit Committee Financial Expert. Our board of directors has determined
that Daniel G. Libarle, who has served as chairman of our audit committee since
2001, is also the audit committee financial expert, and is independent as
defined by Rule 4200(a)(15) of the National Association of Securities Dealers,
Inc. The Board based its determination on the fact that Mr. Libarle has
extensive experience evaluating financial statements, and actively supervising
financial managers responsible for preparing financial statements in accordance
with generally accepted accounting principles, in his capacity as the owner and
president of Lace House Linen, Inc. for the past 20 years. Mr. Libarle has also
acquired an understanding of internal controls, procedures for financial
reporting and audit committee functions as the founding chairman of the board
for Bank of Petaluma, since 1985, and as a member of the audit committee of the
board of directors of Greater Bay Bancorp for the past three years.
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AUDIT COMMITTEE REPORT
Management is responsible for our internal controls and financial
reporting process. Our independent accountants for fiscal 2003, Pisenti &
Brinker LLP, are responsible for performing an independent audit of our
financial statements in accordance with auditing standards generally accepted in
the United States of America and issuing their report. The audit committee's
responsibility is to monitor and oversee these processes.
In connection with these responsibilities, the audit committee met with
management and the independent accountants to review and discuss the financial
statements for the fiscal year ended September 30, 2003. The audit committee
also discussed with the independent accountants the matters required by
Statement on Auditing Standards No. 61 (communication with audit committees).
The audit committee also received written disclosures from the independent
accountants required by Independence Standards Board Standard No. 1
(Independence discussions with audit committees), and the audit committee
discussed with the independent accountants that firm's independence.
Based upon the audit committee's discussions with management and the
independent accountants, and the audit committee's review of the representations
of management and the independent accountants, the audit committee recommended
that the board of directors include the audited financial statements in
Hennessy's annual report on Form 10-KSB for the fiscal year ended September 30,
2003 filed with the Securities and Exchange Commission.
Daniel G. Libarle, Chairman
Henry Hansel
Thomas L. Seavey
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CODE OF ETHICS
On February 5, 2003, we adopted a code of ethics that applies to the
principal executive officer, principal financial officer, executive vice
presidents and controller. The code has been designed in accordance with
provisions of the Sarbanes-Oxley Act of 2002, to promote honest and ethical
conduct. The code is included as an exhibit to our annual report on Form 10-KSB
for the fiscal year ended September 30, 2003.
You may obtain a copy of the Hennessy Advisors, Inc. Code of Ethics, at
no cost, by forwarding a written request to:
Hennessy Advisors, Inc.
750 Grant Avenue, Suite No. 100
Novato, CA 94945
Attention: Teresa A. Nilsen
EXECUTIVE COMPENSATION
The following table summarizes the compensation for services rendered
for the fiscal year ended September 30, 2003, by our executive officers, each
having received total salary and bonus in excess of $100,000 in fiscal 2003:
Annual Compensation
-------------------------------------------------
Long-term
Other Compensation All
Name and Principal Annual Awards - Securities Other
Position Year Salary Bonus Compensation Underlying Options Compensation
-------- ---- ------ ----- ------------ ------------------ ------------
Neil J. Hennessy
Chief Executive Officer 2003 $ 180,000 $223,755 $0 7,500 $ 8,968(1)
2002 $ 156,500 $36,000 $ 4,233(2) 7,500 $ 8,443(3)
2001 $ 135,468 $0 $ 6,950(4) 0 $ 1,456(5)
Teresa M. Nilsen
Chief Officer and Secretary(6) 2003 $ 96,000 $55,000 $0 7,500 $0
2002 $ 75,333 $ 2,500 $0 7,500 $0
Daniel B. Steadman
Executive Vice President(6) 2003 $ 96,000 $50,000 $0 7,500 $0
2002 $ 82,000 $ 2,500 $0 7,500 $0
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(1) 2003 Premiums for life insurance ($5,828) and disability insurance
($3,140).
(2) Auto allowance.
(3) 2002 Premiums for life insurance ($5,827) and disability insurance
($2,616).
(4) Auto allowance and health club membership.
(5) Life insurance premiums.
(6) Information for fiscal 2001 has been omitted as permitted by rules of
the Securities and Exchange Commission.
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We made the following stock option grants to the named executive
officers in the summary compensation table above during the fiscal year ended
September 30, 2003:
Option/SAR Grants In Last Fiscal Year
(Individual Grants)
-----------------------------------------------------------------------------------------------------------------------
Number of
Securities Percent Of Total
Underlying Options Granted Exercise Or
Options To Employees In Base Price Expiration
Name Granted(1) Fiscal Year ($/Share) Date
---- ------- ----------- --------- ----
Neil J. Hennessy 7,500 10.3% $12.00 8/06/2014
Teresa M. Nilsen 7,500 10.3% $12.00 8/06/2014
Daniel B. Steadman 7,500 10.3% $12.00 8/06/2014
-------------------------------------
(1) The options, which have an exercise price of $12 per share and a term
of 11 years, were 100% vested on the date of grant.
As shown in the following table, no executive officers exercised
options during the fiscal year ended September 30, 2003:
Aggregated Option/SAR Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
--------------------------------------------------------------------------------------------------------------------------------
Number of Number Of Unexercised Value Of Unexercised
Shares Securities Underlying In-The-Money Options
Acquired On Value Options At FY-End (#) At FY-End ($)
Name Exercise Realized Exercisable/Unexercisable Exercisable/Unexercisable
---- -------- -------- ------------------------- -------------------------
Neil J. Hennessy -- -- 15,000/0 $60,000/$0
Teresa M. Nilsen -- -- 15,000/0 $60,000/$0
Daniel B. Steadman -- -- 15,000/0 $60,000/$0
Employment Agreements
Neil J. Hennessy entered into an employment agreement relating to his
service as chairman of the board of directors and chief executive officer of
Hennessy and as chief investment officer and portfolio manager for our mutual
funds, effective at the completion of our initial public offering in February
2002. Under the employment agreement, Mr. Hennessy is responsible for managing
or overseeing the management of our mutual funds, attracting mutual fund
accounts, attracting or managing accounts for high net worth individuals or
retirement accounts or otherwise generating revenues. Mr. Hennessy receives an
annual salary of $180,000 plus a car, insurance, and any other benefits that
other employees receive. In addition to his base compensation, Mr. Hennessy
receives an incentive-based management fee in the amount of 10% of our pre-tax
profit, if any, as computed for financial reporting purposes in accordance with
accounting principles generally accepted in the United States of America.
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The term of the employment agreement extends through the year 2006 and
is automatically renewed thereafter for one-year terms unless either party gives
notice of nonrenewal at least 60 days before the end of the current term. The
agreement can be modified only with the consent of our board of directors. If we
terminate Mr. Hennessy's employment without cause or he terminates his
employment for good reason, he will be entitled to a severance payment equal to
the greater of (1) his base salary and allocable bonus for the remainder of the
term of the agreement, or (2) one year of base salary and allocable bonus. The
allocable bonus will be 75% of the average annual bonus actually paid to Mr.
Hennessy during the term of his employment.
Director Compensation
During fiscal 2003, outside directors have been compensated in cash for
their participation in board meetings ($750 per meeting) and committee meetings
($250 per meeting, 2 committees). Outside directors have also been granted
20,000 stock options each, through the fiscal year ended September 30, 2003.
Effective October 1, 2003, compensation for attending board meetings
was increased to $1,000 per meeting.
CERTAIN TRANSACTIONS
There have been no transactions of more than $60,000 between Hennessy
and any shareholder, director or executive officer during the last two-year
period ending September 30, 2003.
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INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
On June 3, 2003, we dismissed our auditors, KPMG LLP and appointed
Pisenti & Brinker, LLP as our new independent auditors, effective June 4, 2003.
This change was approved by the audit committee.
During the two recent fiscal years ended September 30, 2002, and the
subsequent interim period through June 3, 2003, there were no disagreements
between us and KPMG on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to KPMG's satisfaction, would have caused KPMG to
make reference to the subject matter of the disagreement in connection with its
reports.
The audit reports of KPMG on our financial statements as of and for the
fiscal years ended September 30, 2002 and September 30, 2001 did not contain any
adverse opinion or disclaimer of opinion, nor were they qualified or modified as
to uncertainty, audit scope or accounting principles. A letter from KPMG is
attached as an exhibit to our current report on Form 8-K filed June 10, 2003.
The board of directors has selected Pisenti & Brinker LLP to serve as
our independent certified public accountants for the current fiscal year ending
September 30, 2004. That firm has served as our auditors beginning on June 4,
2003 for the fiscal year ended September 30, 2003. Representatives of Pisenti &
Brinker LLP are expected to be present at the annual meeting of shareholders and
will be accorded the opportunity to make a statement, if they so desire, and to
respond to appropriate questions.
The following table provides information relating to the fees KPMG and
Pisenti & Brinker billed to Hennessy Advisors, Inc., Hennessy Funds, Inc., and
Hennessy Mutual Funds Inc., for the fiscal years ended September 30, 2003 and
2002.
Audit Audit-Related Tax All Other Total
Fees Fees(1) Fees(2) Fees(3) Fees
---- ---- ---- ---- ----
Fiscal Year 2003
-- KPMG LLP $28,000 $36,000 $0 $0 $64,000
-- Pisenti & Brinker LLP $0 $4,500 $3,500 $0 $8,000
Fiscal Year 2002
-- KPMG LLP only $30,000 $9,950 $0 $50,000 $89,950
______________________
(1)Audit-related fees are for SEC compliance reviews of Form 10-QSB.
(2)Tax fees are for preparation of federal and state income tax returns.
(3)KPMG LLP "All Other Fees" were for services provided during preparation of
SEC Form SB-2, for the initial public offering of our common stock.
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All decisions regarding selection of independent accounting firms and
approval of accounting services and fees are made by our audit committee in
accordance with the provisions of the Sarbanes-Oxley Act of 2002. There are no
exceptions to the policy of securing pre-approval of our audit committee for any
service provided by our independent accounting firm.
OTHER MATTERS
The board of directors does not know of any other matters to come
before the meeting. However, if any other matters properly come before the
meeting, the persons designated as proxies intend to vote in accordance with
their best judgment on such matters. If any other matter should come before the
meeting, action on the matter will be approved if the number of votes cast in
favor of the matter exceeds the number opposed.
SHAREHOLDER PROPOSALS
Regulations of the Securities and Exchange Commission require proxy
statements to disclose the date by which shareholder proposals must be received
by us in order to be included in our proxy materials for the next annual
meeting. In accordance with these regulations, shareholders are hereby notified
that if, pursuant to Rule 14a-8, they wish a proposal to be included in our
proxy statement and form of proxy relating to the 2005 annual meeting, a written
copy of their proposal must be received at our principal executive offices no
later than August 25, 2004. Proposals must comply with the proxy rules relating
to shareholder proposals in order to be included in our proxy materials.
Notice to us of a shareholder proposal submitted otherwise than
pursuant to Rule 14a-8, including any nomination for director, will be
considered untimely under our bylaws if we receive it after August 25, 2004, and
will not be placed on the agenda for the 2005 annual meeting.
To ensure prompt receipt by Hennessy, proposals should be sent
certified mail, return receipt requested.
ANNUAL REPORT
A copy of our annual report on Form 10-KSB for the fiscal year ended
September 30, 2003 accompanies this proxy statement. Additional copies may be
obtained by writing to Teresa M. Nilsen, at our principal executive offices, at
750 Grant Avenue, Suite 100, Novato, California 94945.
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by Hennessy. We may
reimburse brokers and other persons holding stock in their names, or in the
names of nominees, for their expenses for sending proxy material to principals
and obtaining their proxies.
PLEASE SPECIFY YOUR CHOICES, DATE, SIGN AND RETURN THE ENCLOSED PROXY
IN THE ENCLOSED ENVELOPE, POSTAGE FOR WHICH HAS BEEN PROVIDED. YOUR PROMPT
RESPONSE WILL BE APPRECIATED.
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THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO Please
DIRECTION IS INDICATED WILL BE VOTED "FOR" EACH Mark Here [_]
OF THE NOMINEES LISTED BELOW. For Address
Change or
Comments
SEE REVERSE SIDE
The Board of Directors recommends
a vote FOR each nominee listed below. FOR WITHHELD
ALL FOR ALL
Election of Directors
Nominees: [_] [_]
01. Neil J. Hennessy
02. Teresa M. Nilsen
03. Daniel B. Steadman
04. Henry Hansel WILL
05. Brian A. Hennessy ATTEND
06. Rodger Offenbach
07. Daniel G. Libarle If you plan to attend the annual meeting,
08. Thomas L. Seavey please mark the WILL ATTEND box [_]
WITHHELD FOR: (Write that nominee's name
in the space provided below.)
_________________________________________
Signature __________________ Signature ___________________ Date ________________
NOTE: Please sign as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.
FOLD AND DETACH HERE
YOUR VOTE IS IMPORTANT!
Mark, sign and date your proxy card and return promptly in the enclosed
envelope.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
HENNESSY ADVISORS, INC.
The undersigned hereby appoints Neil J. Hennessy and Teresa M. Nilsen,
and each of them, with power to act without the other and with power of
substitution, as proxies and attorneys-in-fact and hereby authorizes them to
represent and vote, as provided on the other side, all the shares of Hennessy
Advisors, Inc. common stock which the undersigned is entitled to vote, and, in
their discretion, to vote upon such other business as may properly come before
the annual meeting of shareholders of the company to be held January 28, 2004 or
any adjournment thereof, with all powers which the undersigned would possess if
present at the meeting.
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED,
WILL BE VOTED "FOR" EACH OF THE BOARD'S NOMINEES.
Should any other matters requiring a vote of the shareholders arise,
including matters incident to the conduct of the meeting, the above named
proxies are authorized to vote the same in accordance with their best judgment
in the interest of the company.
(Continued, and to be marked, dated and signed, on the other side)
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Address Change/Comments (Mark the corresponding box on the reverse side)
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FOLD AND DETACH HERE
YOUR VOTE IS IMPORTANT!
You can vote by mail - by promptly returning your
completed proxy card in the enclosed envelope.