For Clients

Firms such as HTK that are broker-dealers and registered investment advisers play an important role in the financial services industry. They provide the infrastructure and platform for registered representatives, or financial professionals who are licensed to sell securities, to do business. These registered representatives are required to partner with a broker-dealer to run their practice. A broker-dealer facilitates financial activities and transactions. A registered investment adviser is a firm that is registered with the U.S. Securities and Exchange Commission to manage investments. HTK operates as both a broker-dealer and registered investment adviser.

Communications and statements about your financial accounts will typically come from your independent financial professional or the product sponsor (that is, the place where your account is held). On occasion, HTK contacts clients directly, as required by law, to verify that your information is up to date and to provide you with important notices about your account. If you have questions about a letter you have received, please contact your financial professional noted on the communication or contact HTK.

All activities of HTK and your financial professional are strictly regulated by the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). HTK closely supervises the activities of every registered representative with our firm. You can read our client privacy policies and related disclosures below.

HTK is a wholly-owned subsidiary of The Penn Mutual Life Insurance Company. As an independent broker-dealer and registered investment adviser, HTK provides a full range of investment solutions, including mutual funds, stocks, bonds, variable life insurance products and annuities, which financial professionals can offer their clients, depending on their licensing or registration type.

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HTK Advisory Services Disclosure Brochure (Form ADV, Part 2A)

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HTK Wrap Fee Program Brochure (Form ADV Part 2A Appendix)

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The purpose of this Business Continuity Plan (BCP) summary is to ensure our clients that HTK has a business continuity plan with detailed policies and procedures, which we will employ in the event of a Significant Business Disruption (SBD). HTK’s policy is to respond to a SBD by taking reasonable measures designed to safeguard employees’ lives and firm property, making financial and operational assessment, quickly as practicable recovering and resuming operations, protecting all of the firm’s books and records, and allowing our customers to transact business. In the event that we determine we are unable to continue our business we will take steps towards assuring customers prompt access to their funds and securities.

Our plan anticipates two kinds of SBDs, internal and external. Internal SBDs affect only our firm’s ability to communicate and do business such as a flood or fire in our building. External SBDs prevent the operation of the securities markets or a number of firms, such as a terrorist attack, a blackout or a wide scale regional disruption. Our response to an external SBD relies heavily on other organizations and systems, especially on the capabilities of our clearing firm, Pershing LLC. Pershing LLC has a BCP and their mission for contingency planning is to ensure the continuous, reliable delivery of service to Pershing’s customers while maintaining regulatory compliance.

A complete test of our business continuity plan occurs annually and the plan is updated as necessary. Further information regarding HTK's BCP is available upon written request.

This disclosure offers the clients of Hornor, Townsend & Kent, LLC (HTK) additional information concerning the marketing and compensation arrangements HTK has with approved product sponsor firms.

HTK is a Registered Broker-Dealer and Registered Investment Advisor based in Horsham, Pennsylvania. The firm has approximately 1,000 registered representatives and approximately 500 investment advisory representatives (IARs). HTK has formed partnerships with a variety of product companies who sponsor the various products and services our registered representatives sell. HTK's registered representatives sell these investment products to their clients in order to help clients achieve their financial goals.

As a result of the partnerships HTK has with its approved product sponsors, those firms may engage in activities with HTK's registered representatives to help facilitate the education and distribution of their products, such as educating registered representatives to make them more knowledgeable about such products or services. Some of those activities may include the following:

           
• One-on-one consulting

• Hosting due diligence events or presentations

• Providing teleconferences or webinars

• Distributing sales literature or other collateral materials

• Hosting group breakfasts, luncheons or dinners.

HTK and its registered representatives receive compensation for the sale of securities products, including mutual funds, money market funds, investment advisory services, variable products, stocks, bonds, UITs, non-traded REITs and business development corporations. This compensation may be in the form of:

• Commissions and sales loads based on specific transactions affected.

• Advisory fees based on the amount of assets under management or financial planning function performed by the Investment Advisory Representative of HTK. These fees are disclosed in the client's Investment Advisory contract with HTK.

• Recurring distribution fees based on assets held in an account (i.e. 12b-1 and/or management fees). Note that the fees and expenses associated with mutual fund and variable product sales are disclosed in the product sponsors' prospectus for that specific investment.

• Cash payments to HTK from product sponsors as a reimbursement for training and educational expenses incurred by registered representatives or HTK home office associates when attending educational meetings or conferences held by HTK or by a product company.

• Cash payments through HTK to registered representatives as reimbursements for certain client educational efforts or attendance at due diligence meetings.

HTK has a policy of not allowing the absorption of ticket charges by product sponsors and not participating in directed brokerage transactions. In addition, HTK receives compensation calculated on cash balances in money market funds in accounts held at Pershing, as well as margin debt interest. Registered representatives do not participate in this compensation.

HTK’s Educational Partners Program is a fee-based program designed to offer access to HTK's network of registered representatives and Investment Advisory Representatives (IARs) for education, training and marketing purposes. Because of the large number of HTK approved product sponsors with whom we have selling agreements, forming a focused group of educational sponsors enables HTK to make the most efficient use of its resources in order to educate our registered representatives and IARs. The type of access HTK’s Educational Partners receive may include participation in the following:

• Educational Conferences

• Webinar trainings for our representatives

• Lists of Registered Representatives and IARs

• Trainings conducted in our offices

• Digital marketing within our intranet site

As part of the program, HTK may publicize and/or promote the products, sales ideas, white papers or other educational materials from these sponsors. The aforementioned materials are designed to educate HTK's registered representatives and IARs on the firm’s products.

Approved product sponsors of mutual funds, advisory products and direct participation programs are provided the opportunity to participate in HTK's Educational Partners Program. If firms are interested in participating in the program, they make payments to HTK, which enables them greater access and opportunity to educate our representatives and IARs.  There is no requirement for an HTK representative or IAR to market or sell the products of the firms participating in the Educational Partners Program.

HTK does not allow additional commission or other compensation to be paid to its representatives or IARs for recommending an investment or product from a firm participating in the Educational Partners Program. Our representatives and IARs may recommend a product from any HTK approved product sponsor, with their recommendation based upon the product suitability to the client and with a focus on recommending products that are consistent with the client’s stated investment objectives and needs. HTK, its representatives and IARs may receive other reimbursements from product sponsors in the form of attending a Sponsor Partner’s conference or seminar for educational purposes. The firm may reimburse or pay for travel and other related expenses incurred by HTK representatives and IARs to attend such conferences or seminars.

The following firms are participating in various educational activities in 2021 and may be part of the HTK’s Educational Partners Program. As such, some of these firms may have a fee arrangement to participate in the educational activities. The payments range from $1,000 to up to $200,000 annually.

• AssetMark, Inc.

• Mariner Wealth Advisors

• Morningstar Investment Services

• Orion Advisor Solutions/Brinker Capital, Inc.

• SEI

Hornor, Townsend & Kent’s clearing firm, Pershing LLC (“Pershing”) provides order routing data on www.orderroutingdisclosure.com. If you would like to review order routing information, you will be required to enter “Hornor Townsend & Kent, Llc” into the search area when you access the website. To visit the site, please click here.

htk is registered with the U.S. Securities and Exchange Commission and the Municipal Securities Rulemaking Board (“msrb”). An investor brochure that describes the protections that may be provided by the msrb’s rules, and information about how to file a complaint with an appropriate regulatory authority, is available at www.msrb.org.