UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________
FORM N-CSR
________
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
INVESTMENT COMPANY ACT FILE NUMBER 811-22431
RIVERPARK FUNDS TRUST
(Exact name of registrant as specified in charter)
________
156 West 56th Street, 17th Floor
New York, NY 10019
(Address of principal executive offices) (Zip code)
Morty Schaja
156 West 56th Street, 17th Floor
New York, NY 10019
(Name and address of agent for service)
With copies to:
Thomas R. Westle
Blank Rome LLP
405 Lexington Avenue
New York, NY 10174
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 212-484-2100
DATE OF FISCAL YEAR END: SEPTEMBER 30, 2013
DATE OF REPORTING PERIOD: SEPTEMBER 30, 2013
ITEM 1. REPORTS TO STOCKHOLDERS.
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Annual Report
September 30, 2013
RiverPark Large Growth Fund
Retail Class and Institutional Class Shares
RiverPark/Wedgewood Fund
Retail Class and Institutional Class Shares
RiverPark Short Term High Yield Fund
Retail Class and Institutional Class Shares
RiverPark Long/Short Opportunity Fund
Retail Class and Institutional Class Shares
RiverPark/Gargoyle Hedged Value Fund
Retail Class and Institutional Class Shares
RiverPark Structural Alpha Fund
Retail Class and Institutional Class Shares
RiverPark Strategic Income Fund
Retail Class and Institutional Class Shares
Investment Adviser:
RiverPark Advisors, LLC
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TABLE OF CONTENTS
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Management's Discussion of Fund Performance and Analysis
RiverPark Large Growth Fund ............................................ 1
RiverPark/Wedgewood Fund ............................................... 3
RiverPark Short Term High Yield Fund ................................... 5
RiverPark Long/Short Opportunity Fund .................................. 7
RiverPark/Gargoyle Hedged Value Fund ................................... 10
RiverPark Structural Alpha Fund ........................................ 12
Schedules of Investments
RiverPark Large Growth Fund ............................................ 15
RiverPark/Wedgewood Fund ............................................... 16
RiverPark Short Term High Yield Fund ................................... 17
RiverPark Long/Short Opportunity Fund .................................. 20
RiverPark/Gargoyle Hedged Value Fund ................................... 24
RiverPark Structural Alpha Fund ........................................ 26
RiverPark Strategic Income Fund ........................................ 28
Statements of Assets and Liabilities ........................................ 29
Statements of Operations .................................................... 31
Statements of Changes in Net Assets ......................................... 33
Financial Highlights ........................................................ 36
Notes to Financial Statements ............................................... 40
Report of Independent Registered Public Accounting Firm ..................... 57
Trustees and Officers of the Trust .......................................... 58
Disclosure of Fund Expenses ................................................. 60
Approval of the Investment Advisory and Investment Sub Advisory Agreements .. 62
Notice to Shareholders ...................................................... 68
The RiverPark Funds file their complete schedules of fund holdings with the
Securities and Exchange Commission (the "Commission") for the first and third
quarters of each fiscal year on Form N-Q within sixty days after the end of the
period. The Funds' Forms N-Q are available on the Commission's website at
http://www.sec.gov, and may be reviewed and copied at the Commission's Public
Reference Room in Washington, D.C. Information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
A description of the policies and procedures that the Funds use to determine
how to vote proxies relating to fund securities, as well as information
relating to how a Fund voted proxies relating to fund securities during the
most recent period ended June 30 is available (i) without charge, upon request,
by calling 888-564-4517; and (ii) on the Commission's website at
http://www.sec.gov.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK LARGE GROWTH FUND
For the fiscal year ended September 30, 2013, the RiverPark Large Growth Fund
gained 23.46% and 23.15% on its Institutional Class Shares and Retail Class
Shares, respectively, while the Russell 1000 Growth Index gained 19.27% and the
S&P 500 Index gained 19.34% . The Fund's outperformance was primarily a result
of the Fund's ability to purchase some key holdings when they were out of favor
and selling at what, we believed, were attractive prices over the fiscal year.
Investment results for the fiscal year were not uniform across quarters. The
Institutional Class Shares gained 0.94% for the December quarter, 10.29% for
the March quarter, 2.72% for the June quarter, and 7.96% in the September
quarter. These results followed a similar pattern of the market which also
exhibited performance that was not uniform across quarters.
The Fund's investment results were not uniform across sectors. The Fund's best
fiscal year-to-date performing sectors were Consumer Discretionary, Financials,
Industrials and Energy. The Fund's worst fiscal year-to-date performing sectors
were Health Care, Telecommunication Services, Information Technology and
Materials. The Fund's best fiscal year-to-date performers were The Blackstone
Group LP, priceline.com, TD Ameritrade Holding, Dollar Tree and Alliance Data
Systems. The Fund's worst fiscal year-to-date performers were Apple, Equinix,
EMC, Edwards Lifesciences and VeriFone Systems.
The RiverPark Large Growth Fund seeks to make investments in securities of
large capitalization companies, which it defines as those in excess of $5
billion. The Fund invests in what it believes are exciting growth businesses
with significant long-term growth potential, but patiently waits for
opportunities to purchase these companies at attractive prices. RiverPark
believes the style is best described as a "value orientation toward growth."
RiverPark believes that the current market environment provides it with an
opportunity to own a diversified portfolio of growth stocks at attractive
valuations. We are cautiously optimistic that we can achieve our long-term
objective of realizing above average rates of return over the next few years.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The Russell 1000 Growth Index measures the performance of the large-cap growth
segment of the U.S. equity universe. It includes those Russell 1000 Index
companies with higher price-to-book ratios and higher forecasted growth
values.
The S&P 500 Index is an unmanaged market capitalization value weighted
composite index of 500 stocks.
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Comparison of Change in the Value of a $10,000 Investment in the RiverPark Large
Growth Fund, Retail Class Shares, versus the Russell 1000 Growth Index and the
S&P 500 Index
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AVERAGE ANNUAL TOTAL RETURNS FOR
THE PERIOD ENDED SEPTEMBER 30, 2013
----------------------------------------------------------
Annualized Annualized
One Year Return 3 Year Return Inception to Date*
----------------------------------------------------------
Institutional Class Shares 23.46% 18.10% 18.10%
----------------------------------------------------------
Retail Class Shares 23.15% 17.80% 17.80%
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Russell 1000 Growth Index 19.27% 16.94% 16.94%
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S&P 500 Index 19.34% 16.27% 16.27%
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Initial Investment
Date
9/30/10 9/30/11 9/30/12 9/30/13
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RiverPark Large Growth Fund, Retail Class Shares $10,000 $10,119 $13,275 $16,347
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Russell 1000 Growth Index $10,000 $10,378 $13,407 $15,991
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S&P 500 Index $10,000 $10,114 $13,169 $15,716
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* Fund commenced operations on September 30, 2010.
Returns shown above are calculated assuming reinvestment of all dividends and
distributions. Returns do not reflect the deduction of taxes that a shareholder
would pay on dividends or distributions or the redemption of shares from a
fund. Returns reflect fee waivers and/or reimbursements in effect for the
period; absent fee waivers and reimbursements, performance would have been
lower. Results represent past performance and do not indicate future results.
The value of an investment in the Fund and the return on investment both will
fluctuate and redemption proceeds may be higher or lower than a shareholder's
original cost. Performance of the Institutional Class Shares differs due to the
differences in expenses. Current performance may be lower or higher than that
shown here. Unlike the Fund's comparative benchmarks, the Fund's total returns
are reduced by its annual operating expenses. Please note that one cannot
invest directly in an unmanaged index.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK/WEDGEWOOD FUND
For the fiscal year ended September 30, 2013, the RiverPark/Wedgewood Fund
gained 17.15% and 16.79% on its Institutional Class Shares and Retail Class
Shares, respectively, while the Russell 1000 Growth Index gained 19.27% and the
S&P 500 Index gained 19.34%.
Investment results for the fiscal year were not uniform across quarters. The
Institutional Class Shares gained 0.03% for December quarter, 5.71% for the
March quarter, 1.85% for the June quarter, and 8.79% in the September quarter.
The Fund's investment results were not uniform across sectors. The Fund's best
fiscal year-to-date performing sectors were Financials, Industrials and Health
Care. The Fund's worst fiscal year-to-date performing sectors were Energy,
Consumer Discretionary and Information Technology. The Fund's best fiscal
year-to-date performers were Gilead Sciences, Cognizant Technology Solutions,
priceline.com, Charles Schwab and Cummins. The Fund's worst fiscal year-to-date
performers were Apple, M&T Bank, Express Scripts Holding, Coach and Expeditors
International of Washington.
The RiverPark/Wedgewood Fund seeks to make investments in about 19-21
companies, with market capitalizations in excess of $5 billion, which it
believes have above-average growth prospects. The Fund invests in businesses
that it believes are market leaders with a long-term sustainable competitive
advantage. It patiently waits for opportunities to purchase what it believes
are great businesses at attractive prices. While the Fund invests in growth it
believes that valuation is the key to generating attractive returns over the
long-term. Unlike most growth investors, the Fund's sub-adviser, Wedgewood
Partners Inc. ("Wedgewood") is not a momentum investor but rather a contrarian
growth investor. Wedgewood is a firm that believes in investing as opposed to
trading and generally experiences an annual portfolio turnover of less than
50%. Wedgewood believes that the current market environment provides it with an
opportunity to own a portfolio of growth stocks at attractive valuations. We
are cautiously optimistic that we can achieve our long-term objective of
realizing above average rates of return over the next few years.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The Russell 1000 Growth Index measures the performance of the large-cap growth
segment of the U.S. equity universe. It includes those Russell 1000 Index
companies with higher price-to-book ratios and higher forecasted growth
values.
The S&P 500 Index is an unmanaged market capitalization value weighted
composite index of 500 stocks.
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Comparison of Change in the Value of a $10,000 Investment in the
RiverPark/Wedgewood Fund, Retail Class Shares, versus the Russell 1000 Growth
Index and the S&P 500 Index
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AVERAGE ANNUAL TOTAL RETURNS FOR
THE PERIOD ENDED SEPTEMBER 30, 2013
----------------------------------------------------------
Annualized Annualized
One Year Return 3 Year Return Inception to Date*
----------------------------------------------------------
Institutional Class Shares 17.15% 17.66% 17.66%
----------------------------------------------------------
Retail Class Shares 16.79% 17.35% 17.35%
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Russell 1000 Growth Index 19.27% 16.94% 16.94%
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S&P 500 Index 19.34% 16.27% 16.27%
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Initial Investment
Date
9/30/10 9/30/11 9/30/12 9/30/13
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RiverPark/Wedgewood Fund, Retail Class Shares $10,000 $10,312 $13,836 $16,160
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Russell 1000 Growth Index $10,000 $10,378 $13,407 $15,991
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S&P 500 Index $10,000 $10,114 $13,169 $15,716
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* Fund commenced operations on September 30, 2010.
Returns shown above are calculated assuming reinvestment of all dividends and
distributions. Returns do not reflect the deduction of taxes that a shareholder
would pay on dividends or distributions or the redemption of shares from a
fund. Returns reflect fee waivers and/or reimbursements in effect for the
period; absent fee waivers and reimbursements, performance would have been
lower. Results represent past performance and do not indicate future results.
The value of an investment in the Fund and the return on investment both will
fluctuate and redemption proceeds may be higher or lower than a shareholder's
original cost. Performance of the Institutional Class Shares differs due to the
differences in expenses. Current performance may be lower or higher than that
shown here. Unlike the Fund's comparative benchmarks, the Fund's total returns
are reduced by its annual operating expenses. Please note that one cannot
invest directly in an unmanaged index.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK SHORT TERM HIGH YIELD FUND
For the fiscal year ended September 30, 2013, the RiverPark Short Term High
Yield Fund gained 3.39% and 3.14% on its Institutional Class Shares and Retail
Class Shares, respectively, while the BofA Merrill Lynch 1-3 Year U.S.
Corporate Index gained 1.76% and the BofA Merrill Lynch 1-Year U.S. Treasuries
Index gained 0.31% .
Investment results for the Fiscal Year were not uniform across quarters. The
Institutional Class Shares gained 0.89% for December quarter, 0.96% for the
March quarter, 0.46% for the June quarter, and 1.04% in the September quarter.
The Fund realized positive contributions from its investments in each of its
five categories of investment in the fiscal year ended September 30, 2013. The
Fund realized a contribution to its performance of 1.05% in its investments in
the Short Term Maturity category, 1.00% in Redeemed Debt investments, 0.89% in
Cushion Bonds, 0.69% in Event-Driven, and 0.64% in Strategic Recap investments.
The Fund continues to strive for maximum yield with the lowest effective
duration possible. As of September 30, 2013, 71% of the Fund's invested
portfolio is expected to mature or be repaid within 90 days, while 89% of the
Fund's invested portfolio is expected to mature or be repaid within 12 months.
Over 71% of the invested portfolio is expected to be repaid as the result of a
corporate event (redemption or early retirement due to an acquisition or
recapitalization).
The RiverPark Short Term High Yield Fund focuses on short term high yield
securities for which they believe credit ratings do not accurately reflect a
company's ability to meet their short term credit obligations. The RiverPark
Short Term High Yield Fund seeks to make investments in fixed income securities
of companies that have announced or, in the opinion of the Fund's sub-adviser,
Cohanzick Management LLC ("Cohanzick"), will announce a funding event,
reorganization or other corporate event that they believe will have a positive
impact on a company's ability to repay their debt. Additionally, the Fund will
invest in securities in which it perceives there is limited near term risk of
default. In Cohanzick's view, the risks associated with investing in short term
high yield debt are very different from investing in long-dated paper in which
operating performance and business sustainability are of primary concern.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The BofA Merrill Lynch 1-3 Year U.S. Corporate Bond Index is an unmanaged index
comprised of U.S. dollar denominated investment grade corporate debt securities
publicly issued in the U.S. domestic market with at least one year remaining
term to final maturity.
The BofA Merrill Lynch 1-Year U.S. Treasury Index tracks the performance of
U.S. dollar denominated sovereign debt publicly issued by the U.S. government
in its domestic market with at least one year remaining term to final
maturity.
The BofA Merrill Lynch 0-3 Year U.S. High Yield Index Excluding Financials
considers all securities from the BofA Merrill Lynch US High Yield Master II
Index and the BofA Merrill Lynch U.S. High Yield, 0-1 Year Index, and then
applies the following filters: securities greater than or equal to one month
but less than 3 years to final maturity, and exclude all securities with Level
2 sector classification = Financial (FNCL).
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Comparison of Change in the Value of a $10,000 Investment in the RiverPark Short
Term High Yield Fund, Retail Class Shares, versus the BofA Merrill Lynch 1-3
Year U.S. Corporate Bond Index, the BofA Merrill Lynch 1-Year U.S. Treasury
Index and the BofA Merrill Lynch 0-3 Year U.S. High Yield Index
----------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR
THE PERIOD ENDED SEPTEMBER 30, 2013
----------------------------------------------------------
Annualized Annualized
One Year Return 3 Year Return Inception to Date*
----------------------------------------------------------
----------------------------------------------------------
Institutional Class Shares 3.39% 3.96% 3.96%
----------------------------------------------------------
Retail Class Shares 3.14% 3.69% 3.69%
----------------------------------------------------------
BofA Merrill Lynch 1-3 Year U.S.
Corporate Bond Index 1.76% 2.55% 2.55%
----------------------------------------------------------
BofA Merrill Lynch 1-Year U.S.
Treasury Index 0.31% 0.37% 0.37%
----------------------------------------------------------
BofA Merrill Lynch 0-3 Year U.S.
High Yield Index 6.89% 6.48% 6.48%
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[LINE GRAPH OMITTED - PLOT POINTS AS FOLLOWS]
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Initial Investment
Date
9/30/10 9/30/11 9/30/12 9/30/13
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RiverPark Short Term High Yield Fund, Retail Class Shares $10,000 $10,306 $10,809 $11,149
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BofA Merrill Lynch 1-3 Year Corporate Bond Index $10,000 $10,141 $10,598 $10,785
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BofA Merrill Lynch 1-Year Treasury Index $10,000 $10,055 $10,082 $10,113
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BofA Merrill Lynch 0-3 Year US High Yield ex-Financials $10,000 $10,220 $11,293 $12,071
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* Fund commenced operations on September 30, 2010.
Returns shown above are calculated assuming reinvestment of all dividends and
distributions. Returns do not reflect the deduction of taxes that a shareholder
would pay on dividends or distributions or the redemption of shares from a
fund. Returns reflect fee waivers and/or reimbursements in effect for the
period; absent fee waivers and reimbursements, performance would have been
lower. Results represent past performance and do not indicate future results.
The value of an investment in the Fund and the return on investment both will
fluctuate and redemption proceeds may be higher or lower than a shareholder's
original cost. Performance of the Institutional Class Shares differs due to the
differences in expenses. Current performance may be lower or higher than that
shown here. Unlike the Fund's comparative benchmarks, the Fund's total returns
are reduced by its annual operating expenses. Please note that one cannot
invest directly in an unmanaged index.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK LONG/SHORT OPPORTUNITY FUND
For the fiscal year ended September 30, 2013, the RiverPark Long/Short
Opportunity Fund gained 0.55% and 0.45% on its Institutional Class Shares and
Retail Class Shares, respectively, while the S&P 500 Index gained 19.34% and
the Morningstar Long/Short Equity Category gained 9.14% . The average gross and
net exposures of the Fund for the fiscal year were 162% and 56% (long 109%,
short 53%), respectively.
The Fund's performance for the fiscal year was disappointing. While the Fund
performed well with its long positions, the Fund's short portfolio erased
almost all of its gains for the year. The Fund's long positions contributed
approximately 21.5% for the fiscal year, as compared to the performance of the
broad stock market as measured by the S&P 500 which gained 19.3% . The Fund was
negatively affected by its short positions which detracted approximately 21%
for the fiscal year ended September 30, 2013. On average, holdings in the short
book gained 39.6%, substantially greater than the performance of the S&P 500.
While we believe the Fund's shorts are comprised of businesses facing major
headwinds going forward and have flawed business models, they nonetheless were
bid up in price in a market that favored turnarounds.
Investment results for the partial fiscal year were not uniform across
quarters. The Institutional Class Shares lost 3.13% for December quarter,
gained 1.44% for the March quarter, lost 1.82% for the June quarter, and gained
4.23% in the September quarter.
The Fund's investment results were not uniform across sectors. The Fund's best
fiscal year-to-date performing sectors were Financials, Consumer Discretionary,
Energy, Telecommunication Services and Materials. The Fund's worst fiscal
year-to-date performing sectors were Consumer Staples, Information Technology,
Health Care and Industrials. The Fund's best fiscal year-to-date performers
were The Blackstone Group LP, priceline.com, Cognizant Technology Solutions,
Dollar Tree and Starbucks. The Fund's worst fiscal year-to-date performers were
comprised of Netflix, Best Buy, Green Dot, Nokia and Electronic Arts.
Derivatives, which were used to marginally leverage the long positions through
total return swaps or equity options, contributed approximately 1.1% to the
Fund performance.
The RiverPark Long/Short Opportunity Fund seeks long-term capital appreciation
while managing downside volatility by investing long in equity securities that
the Fund's investment adviser believes have above-average growth prospects and
selling short equity securities the Adviser believes are competitively
disadvantaged over the long-term. The Fund is an opportunistic long/short
investment fund. The Fund's investment goal is to achieve above average rates
of return with less volatility and less downside risk as compared to U.S.
equity markets. We believe the long book is currently comprised of businesses
that are still attractively priced as, on average, their businesses have
experienced earnings growth in excess of their stock price gains. We believe
the substantial appreciation of the short book, has created an unusually
attractive opportunity to short businesses that we believe are flawed at what
we believe are full values. We are cautiously optimistic that we will once
again achieve above average performance in the year ahead.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The S&P 500 Index is an unmanaged market capitalization value weighted
composite index of 500 stocks.
The Morningstar Long/Short Equity Category portfolios hold sizable stakes in
both long and short positions. Some funds that fall into this category are
market neutral - dividing their exposure equally between long and short
positions in an attempt to earn a modest return that is not tied to the
market's fortunes. Other portfolios that are not market neutral will shift
their exposure to long and short positions depending upon their macro outlook
or the opportunities they uncover through bottom-up research.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK LONG/SHORT OPPORTUNITY FUND (UNAUDITED)
Supplemental Disclosure:
The following represents a reconciliation of accounting principles generally
accepted in the United States of America ("GAAP") to non-GAAP exposure for
underlying investments that are held by the Fund through investments in common
stock, total return swap transactions and option transactions as of September
30, 2013. The total non-GAAP exposure is calculated by using the common stock
plus the notional swap and the delta-adjusted options values divided by the net
asset value of the Fund as of September 30, 2013.
<s>
Reconciliation of GAAP to Non-GAAP Long Exposure by Underlier
GAAP Non-GAAP GAAP Non-GAAP
Exposure Exposure Exposure Exposure
---------------------- -------------------------
Accretive Health National Oilwell Varco
Common Stock 1.0% 1.0% Common Stock 3.6% 3.6%
Total Return Swap -- 0.1% Total Return Swap -- 0.0%
---- ---- ---- ----
1.0% 1.1% 3.6% 3.6%
---- ---- ---- ----
Alliance Data Systems priceline.com
Common Stock 2.3% 2.3% Common Stock 3.4% 3.4%
Total Return Swap -- 0.1% Total Return Swap -- 0.1%
---- ---- ---- ----
2.3% 2.4% 3.4% 3.5%
---- ---- ---- ----
American Tower QUALCOMM
Common Stock 2.9% 2.9% Common Stock 5.4% 5.4%
Total Return Swap -- 0.1% Total Return Swap -- 0.1%
---- ---- ---- ----
2.9% 3.0% 5.4% 5.5%
---- ---- ---- ----
Apple SBA Communications
Common Stock 3.5% 3.5% Common Stock 2.5% 2.5%
Total Return Swap -- 0.2% Total Return Swap -- 0.1%
Equity Options 0.1% 0.7% ---- ----
---- ---- 2.5% 2.6%
3.6% 4.4% ---- ----
---- ----
Schlumberger
Cabot Oil & Gas Common Stock 1.5% 1.5%
Common Stock 2.4% 2.4% Total Return Swap -- 0.1%
Total Return Swap -- 0.0% ---- ----
---- ---- 1.5% 1.6%
2.4% 2.4% ---- ----
---- ----
Southwestern Energy
CME Group Common Stock 2.3% 2.3%
Common Stock 2.3% 2.3% Total Return Swap -- 2.1%
Total Return Swap -- 0.1% ---- ----
---- ---- 2.3% 4.4%
2.3% 2.4% ---- ----
---- ----
Visa
Dollar Tree Common Stock 2.9% 2.9%
Common Stock 1.5% 1.5% Total Return Swap -- 0.2%
Total Return Swap -- 1.3% ---- ----
---- ---- 2.9% 3.1%
1.5% 2.8% ---- ----
---- ----
Walt Disney
eBay Common Stock 1.0% 1.0%
Common Stock 1.4% 1.4% Total Return Swap -- 1.2%
Total Return Swap -- 1.4% ---- ----
---- ---- 1.0% 2.2%
---- ----
1.4% 2.8%
---- ----
Mastercard REMAINING UNDERLIERS,
Common Stock 0.8% 0.8% COMMON STOCK 60.6% 60.6%
Total Return Swap -- 1.5% ------ ------
---- ---- TOTAL, BEFORE TIME DEPOSIT 101.4% 110.7%
0.8% 2.3% ------ ------
---- ---- TIME DEPOSIT 11.0% 11.0%
------ ------
TOTAL, AFTER TIME DEPOSIT 112.4% 121.7%
====== ======
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Comparison of Change in the Value of a $10,000 Investment in the RiverPark
Long/Short Opportunity Fund, Retail Class Shares, versus the S&P 500 Index and
Morningstar Long/Short Equity Category
----------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR
THE PERIOD ENDED SEPTEMBER 30, 2013
----------------------------------------------------------
Annualized Annualized
One Year Return 3 Year Return** Inception to Date**
----------------------------------------------------------
----------------------------------------------------------
Institutional Class Shares* 0.55% 11.62% 9.24%
----------------------------------------------------------
Retail Class Shares* 0.45% 11.54% 9.19%
----------------------------------------------------------
S&P 500 Index 19.34% 16.27% 14.70%
----------------------------------------------------------
Morningstar Long/Short Equity
Category 9.14% 4.60% 3.84%
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[LINE GRAPH OMITTED - PLOT POINTS AS FOLLOWS]
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Initial Investment
Date
9/30/09 9/30/10 9/30/11 9/30/12 9/30/13
RiverPark Long/Short Opportunity, Retail Class Shares $10,000 $10,242 $10,708 $14,151 $14,215
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S&P 500 Index $10,000 $11,016 $11,142 $14,507 $17,313
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Morningstar Long/Short Equity Category $10,000 $10,160 $9,859 $10,655 $11,628
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* Fund commenced operations on March 30, 2012.
** The performance data quoted for periods prior to March 30, 2012 is that of
the Predecessor Fund. The Predecessor Fund commenced operations on September 30,
2009. The Predecessor Fund was not a registered mutual fund and was not subject
to the same investment and tax restrictions as the Fund. If it had been, the
Predecessor Fund's performance might have been lower. Performance shown for
periods of one year and greater are annualized.
For periods after March 30, 2012, the returns shown above are calculated
assuming reinvestment of all dividends and distributions. Returns do not
reflect the deduction of taxes that a shareholder would pay on dividends or
distributions or the redemption of shares from a fund. Returns reflect fee
waivers and/or reimbursements in effect for the period; absent fee waivers and
reimbursements, performance would have been lower. Results represent past
performance and do not indicate future results. The value of an investment in
the Fund and the return on investment both will fluctuate and redemption
proceeds may be higher or lower than a shareholder's original cost. Performance
of the Institutional Class Shares differs due to the differences in expenses.
Current performance may be lower or higher than that shown here. Unlike the
Fund's comparative benchmarks, the Fund's total returns are reduced by its
annual operating expenses. Please note that one cannot invest directly in an
unmanaged index.
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MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK/GARGOYLE HEDGED VALUE FUND
For the fiscal year ended September 30, 2013, the RiverPark/Gargoyle Hedged
Value Fund gained 28.54% and 28.42% on its Institutional Class Shares and
Retail Class Shares, respectively, while the S&P 500 Index gained 19.34% and
the Russell 1000 Value Index gained 22.30% . For the fiscal year ended
September 30, 2013, the Fund's equities gained 39.6% and the Fund lost 11.1% in
its index option positions.
Investment results for the fiscal year were not uniform across quarters. The
Institutional Class Shares gained 7.72% for December quarter, 9.47% for the
March quarter, 2.62% for the June quarter, and 6.22% in the September quarter.
The Fund's investment results were not uniform across sectors. The Fund's best
fiscal year-to-date performing sectors were Information Technology, Health
Care, Consumer Discretionary and Industrials. The Fund's worst fiscal
year-to-date performing sectors were Telecommunication Services, Materials,
Energy and Financials. The Fund's best fiscal year-to-date performers were
Safeway, Celgene, Pitney Bowes, Jazz Pharmaceuticals and Electronic Arts. The
Fund's worst fiscal year-to-date performers were Cliffs Natural Resources,
Alpha Natural Resources, Apollo Group, SandRidge Energy and Abbott
Laboratories.
The RiverPark/Gargoyle Hedged Value Fund seeks long-term capital appreciation
while exposing investors to less risk than broad stock market indexes by
combining two investment strategies. First, the Fund intends to be fully
invested in equity securities of medium-large capitalization companies (the
"Stock Portfolio") that Gargoyle, the Fund's sub-adviser, believes are
attractively priced relative to medium-large capitalization stocks generally.
Second, the Fund sells index call options ("Options Portfolio") against the
Stock Portfolio in an effort to increase the Fund's income, reduce the
volatility of its returns and, in general, improve the reward/risk of the Stock
Portfolio. The Fund expects to maintain a net market exposure of between 35%
and 65%.
We are cautiously optimistic that we can achieve our long-term objective of
realizing above average rates of return over the next few years. Additionally,
the Adviser believes that the Fund can gain performance from its index option
writing activities while it also believes the options can decrease overall
performance volatility.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The S&P 500 Index is an unmanaged market capitalization value weighted
composite index of 500 stocks.
The Russell 1000 Value Index measures the performance of the large-cap value
segment of the U.S. equity universe. It includes those Russell 1000 Index
companies with lower price-to-book ratios and lower expected growth values.
--------------------------------------------------------------------------------
10
[RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the
RiverPark/Gargoyle Hedged Value Fund, Retail Class Shares, versus the S&P 500
Index and the Russell 1000 Value Index
------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIOD ENDED SEPTEMBER 30, 2013
------------------------------------------------------------------------------------------------
Annualized Annualized Annualized Annualized
One Year Return 3 Year Return** 5 Year Return** 10 Year Return** Inception to Date**
------------------------------------------------------------------------------------------------
Institutional Class Shares* 28.54% 11.72% 11.82% 9.23% 8.68%
------------------------------------------------------------------------------------------------
Retail Class Shares* 28.42% 11.61% 11.75% 9.19% 8.65%
------------------------------------------------------------------------------------------------
S&P 500 Index 19.34% 16.27% 10.02% 7.57% 2.91%
------------------------------------------------------------------------------------------------
Russell 1000 Value Index 22.30% 16.25% 8.86% 7.99% 5.52%
------------------------------------------------------------------------------------------------
[LINE GRAPH OMITTED - PLOT POINTS AS FOLLOWS]
------------------------------------------------------------------------------------------------------------------------------------
Initial Investment
Date
9/30/03 9/30/04 9/30/05 9/30/06 9/30/07
------------------------------------------------------------------------------------------------------------------------------------
RiverPark/Gargoyle Hedged Value Fund, Retail Class Shares $10,000 $11,781 $14,302 $16,142 $17,714
------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index $10,000 $11,387 $12,782 $14,161 $16,489
------------------------------------------------------------------------------------------------------------------------------------
Russell 1000 Value Index $10,000 $12,052 $14,063 $16,119 $18,448
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
9/30/08 9/30/09 9/30/10 9/30/11 9/30/12 9/30/13
------------------------------------------------------------------------------------------------------------------------------------
RiverPark/Gargoyle Hedged Value Fund, Retail Class Shares $13,826 $14,920 $17,330 $16,575 $18,782 $24,095
------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index $12,865 $11,977 $13,194 $13,345 $17,375 $20,736
------------------------------------------------------------------------------------------------------------------------------------
Russell 1000 Value Index $14,102 $12,604 $13,726 $13,467 $17.630 $21,562
------------------------------------------------------------------------------------------------------------------------------------
* Fund commenced operations on April 30, 2012.
** The performance data quoted for periods prior to April 30, 2012 is that of
the Predecessor Fund. The Predecessor Fund commenced operations prior to the
periods shown. The Predecessor Fund was not a registered mutual fund and was not
subject to the same investment and tax restrictions as the Fund. If it had been,
the Predecessor Fund's performance might have been lower. Performance shown for
one year and greater are annualized. The Predecessor Fund commenced operations
in 1997. Substantial changes were made to the strategy in January 2000,
consistent with the strategy of the Fund. Performance results during years 1997
through 1999 are available upon request by calling the Fund at 888-564-4517.
For periods after April 30, 2012, the returns shown above are calculated
assuming reinvestment of all dividends and distributions. Returns do not
reflect the deduction of taxes that a shareholder would pay on dividends or
distributions or the redemption of shares from a fund. Returns reflect fee
waivers and/or reimbursements in effect for the period; absent fee waivers and
reimbursements, performance would have been lower. Results represent past
performance and do not indicate future results. The value of an investment in
the Fund and the return on investment both will fluctuate and redemption
proceeds may be higher or lower than a shareholder's original cost. Performance
of the Institutional Class Shares differs due to the differences in expenses.
Current performance may be lower or higher than that shown here. Unlike the
Fund's comparative benchmarks, the Fund's total returns are reduced by its
annual operating expenses. Please note that one cannot invest directly in an
unmanaged index.
--------------------------------------------------------------------------------
11
[RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE AND ANALYSIS
RIVERPARK STRUCTURAL ALPHA FUND
For the fiscal year ended September 30, 2013, the RiverPark Structural Alpha
Fund gained 4.72% on both its Institutional Class Shares and Retail Class
Shares, while the S&P 500 Index gained 19.34% and the Morningstar Long/Short
Equity Category gained 9.14% .(1) Investment results for the partial fiscal
year (upon conversion from the predecessor partnership structure) beginning on
June 28th, 2013 were 1.20% for both share classes, while the S&P 500 Index
gained 5.24% and the Morningstar Long/Short Equity Category gained 3.46%.
The Fund derives its performance through the combination of three core
portfolio components. Each one of these components is designed to address
specific trade-offs between risk and return, and the overall risk and return
profile of the Fund is achieved through an optimized combination of all three
components. In addition, because the strategy is a net seller of options, we
anticipate that it will typically generate a net positive cash position. This
component is held in a collateral account consisting of cash and high-grade,
short-duration fixed income positions. For the quarter ending on September
30th, 2013, the performance of each of these components was as follows:
1. Long Biased Global Index Options: These are packages of call and put
options that are intended to both help the Fund establish its long
bias while creating zones of enhancement and protection around broad
equity index returns. The exposure is typically between 40% and 80%.
For the quarter that just ended, the average exposure was 65.6% and
this component returned 2.65% in what was a strong equity market with
the S&P gaining 5.24%.
2. Non Directional Global Index Options: The Fund typically shorts a
basket of short-dated straddles or strangles in order to take
advantage of options that we believe are statistically expensive. This
component is market neutral and we believe it should perform well in
markets that are relatively stable and range-bound. The exposure is
typically between 40% and 80%. For the quarter that just ended, the
average exposure was 60.5% and this component returned -0.10% as the
markets remained volatile.
3. Constant Hedge: This component is a market short, using futures and
options, that is designed to try to reduce the portfolio's exposure to
market declines. The exposure is typically between 20% and 40%. We
believe that this component may help protect against sharp downward
moves, and as such it's weighting in the portfolio changes based on
the weightings of the other two components. For the quarter that just
ended, the average exposure was 23.1% and this component returned
-1.35% which was not surprising given the S&P gained 5.24%.
4. Collateral: For the quarter ended September 30th, 2013, the
collateral account consisted of cash and Treasury Bills. Given the
near-zero returns of cash and cash equivalent securities, the
performance of this component was essentially flat.
The RiverPark Structural Alpha Fund seeks long-term capital appreciation while
exposing investors to less risk than broad stock market indices by investing
using a portfolio of options that we believe will generate exposure
structurally to equity markets with less volatility. The Fund takes a
systematic approach to investing in equity markets, with a long bias that we
believe will achieve a positive effect on performance by compounding a higher
percentage of market gains than losses. The Fund makes consistent trade-offs
between risks and return in an attempt to generate more stable returns,
partially protect against downside risk, and lessen portfolio volatility.
--------------------------------------------------------------------------------
12
[RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
The Fund's investment philosophy is based on the belief that options on market
indices are generally overpriced, and therefore, an approach that involves
predominately selling these index options will generate structurally superior
risk-adjusted returns. The non-linear profile of options makes them an ideal
tool to modify market performance in order to achieve the Fund's objectives.
Historically, the actual volatility of underlying indices has been, on average,
less than the implied volatilities suggested by the prices of index options.
We believe that the structural reasons for this persistent spread between
implied and realized volatility will continue. By making systematic tradeoffs
between potential upside participation for the possibility to generate more
stable returns, protect against downward moves, and reduce portfolio
volatility, we are cautiously optimistic that the Fund can achieve its
objective of providing long-term capital appreciation while exposing investors
to less risk than broad stock market indicies.
(1) The performance data for periods prior to June 28, 2013 is that of
Wavecrest Partners Fund I L.P. (the'' Predecessor Fund''). The Predecessor Fund
was not a registered mutual fund and was not subject to the same investment and
tax restrictions as the Fund. If it had been, the Predecessor Fund's
performance might have been lower.
This represents the manager's assessment of the market environment at a
specific point in time and should not be relied upon by the reader as research
or investment advice.
The S&P 500 Index is an unmanaged market capitalization value weighted
composite index of 500 stocks.
--------------------------------------------------------------------------------
13
[RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the RiverPark
Structural Alpha Fund, Retail Class Shares, versus the S&P 500 Index
------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR THE PERIOD ENDED SEPTEMBER 30, 2013
------------------------------------------------------------------------------------
Annualized Annualized Annualized
One Year Return** 3 Year Return** 5 Year Return** Inception to Date**
------------------------------------------------------------------------------------
Institutional Class Shares* 4.72% 6.90% 9.63% 9.64%
------------------------------------------------------------------------------------
Retail Class Shares* 4.72% 6.90% 9.63% 9.64%
------------------------------------------------------------------------------------
S&P 500 Index 19.34% 16.27% 10.02% 9.13%
------------------------------------------------------------------------------------
Morningstar Long/Short Equity Category 9.14% 4.60% 2.69% 2.36%
------------------------------------------------------------------------------------
[LINE GRAPH OMITTED - PLOT POINTS AS FOLLOWS]
------------------------------------------------------------------------------------------------------------------------------------
Initial Investment
Date
9/26/08 9/30/08 9/30/09 9/30/10 9/30/11 9/30/12 9/30/13
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Structural Alpha, Retail Class Shares $10,000 $10,016 $11,788 $12,985 $13,205 $15,146 $15,862
------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index $10,000 $9,616 $8,952 $9,861 $9,974 $12,987 $15,498
------------------------------------------------------------------------------------------------------------------------------------
Morningstar Long/Short Equity Category $10,000 $10,000 $10,016 $10,176 $9,875 $10,672 $11,237
------------------------------------------------------------------------------------------------------------------------------------
* Fund commenced operations on June 28, 2013.
** The performance data quoted for periods prior to June 28, 2013 is that of the
Predecessor Fund. The Predecessor Fund was not a registered mutual fund and was
not subject to the same investment and tax restrictions as the Fund. If it had
been, the Predecessor Fund's performance might have been lower. Performance
shown for one year and greater are annualized. The Predecessor Fund commenced
operations on September 26, 2008.
For periods after June 28, 2013, the returns shown above are calculated
assuming reinvestment of all dividends and distributions. Returns do not
reflect the deduction of taxes that a shareholder would pay on dividends or
distributions or the redemption of shares from a fund. Returns reflect fee
waivers and/or reimbursements in effect for the period; absent fee waivers and
reimbursements, performance would have been lower. Results represent past
performance and do not indicate future results. The value of an investment in
the Fund and the return on investment both will fluctuate and redemption
proceeds may be higher or lower than a shareholder's original cost. Performance
of the Institutional Class Shares differs due to the differences in expenses.
Current performance may be lower or higher than that shown here. Unlike the
Fund's comparative benchmarks, the Fund's total returns are reduced by its
annual operating expenses. Please note that one cannot invest directly in an
unmanaged index.
--------------------------------------------------------------------------------
14
[RIVERPARK FUNDS LOGO] RiverPark Large Growth Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
23.6% Information Technology
20.6% Consumer Discretionary
18.3% Financials
10.5% Energy
10.4% Industrials
5.7% Materials
5.0% Telecommunication Services
3.8% Health Care
2.1% Time Deposit
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Common Stock -- 98.5%**
Consumer Discretionary -- 20.7%
Discovery Communications, Cl C* 7,180 $ 561
Dollar Tree* 16,332 934
Dollarama 8,711 708
Fossil Group* 3,306 384
Las Vegas Sands 10,257 681
priceline.com* 939 949
Ralph Lauren, Cl A 2,960 488
Starbucks 7,698 592
Ulta Salon Cosmetics & Fragrance* 2,831 338
Walt Disney 10,097 651
Wynn Resorts 2,877 455
-----
6,741
-----
Energy -- 10.6%
Cabot Oil & Gas, Cl A 17,586 656
National Oilwell Varco 11,084 866
Noble Energy 5,812 390
Schlumberger 3,761 332
Southwestern Energy* 33,270 1,210
-----
3,454
-----
Financials -- 18.4%
American Express 5,381 406
Charles Schwab 22,923 485
CME Group, Cl A 7,781 575
KKR & Co., LP (a) 32,406 667
Mastercard, Cl A 1,150 774
TD Ameritrade Holding 23,657 619
The Blackstone Group LP (a) 65,350 1,626
Visa, Cl A 4,339 829
-----
5,981
-----
Health Care -- 3.8%
Edwards Lifesciences* 4,424 308
Illumina* 3,800 307
Intuitive Surgical* 830 312
Perrigo 2,486 307
-----
1,234
-----
--------------------------------------------------------------------------------
Shares/Face
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
Industrials -- 10.4%
B/E Aerospace* 5,356 $ 396
Precision Castparts 1,660 377
Realogy Holdings* 35,529 1,528
Stericycle* 2,664 308
Trimble Navigation* 13,129 390
Verisk Analytics, Cl A* 6,049 393
-----
3,392
-----
Information Technology -- 23.8%
Alliance Data Systems* 3,144 665
Apple 2,412 1,150
Cognizant Technology
Solutions, Cl A* 9,971 819
eBay* 16,444 917
Equinix* 7,991 1,468
Genpact* 20,155 380
Google, Cl A* 965 845
QUALCOMM 22,242 1,499
-----
7,743
-----
Materials -- 5.8%
Ecolab 3,997 395
Monsanto 11,080 1,156
Praxair 2,651 319
-----
1,870
-----
Telecommunication Services -- 5.0%
American Tower REIT, Cl A 12,402 919
SBA Communications, Cl A* 8,849 712
-----
1,631
-----
Total Common Stock
(Cost $25,609) (000) 32,046
------
Time Deposit -- 2.1%
Brown Brothers, 0.010%, 10/01/13
(Cost $685) (000) $ 685 685
--------
Total Investments -- 100.6%
(Cost $26,294) (000) $ 32,731
========
As of September 30, 2013, all of the Fund's investments were
considered Level 1, except for the Time Deposit which was Level 2, in
accordance with the authoritative guidance on fair value measurements
and disclosure under U.S. GAAP. Please see Note 2 in Notes to
Financial Statements for further information regarding fair value
measurements.
Percentages are based on Net Assets of $32,520 (000).
* Non-income producing security.
** More narrow industries are utilized for compliance purposes,
whereas broad sectors are utilized for reporting purposes.
(a) Security considered Master Limited Partnership. At September 30,
2013, these securities amounted to $2,293 (000) or 7.1% of Net
Assets.
Cl -- Class
LP -- Limited Partnership
REIT -- Real Estate Investment Trust
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
15
[RIVERPARK FUNDS LOGO] RiverPark/Wedgewood Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
31.6% Information Technology
18.0% Financials
16.0% Health Care
11.9% Industrials
9.3% Consumer Discretionary
6.6% Time Deposit
6.6% Energy
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Common Stock -- 93.2%**
Consumer Discretionary -- 9.3%
Coach 865,000 $ 47,169
Monster Beverage* 481,000 25,132
priceline.com* 37,000 37,405
-------
109,706
-------
Energy -- 6.5%
National Oilwell Varco 435,000 33,978
Schlumberger 491,000 43,385
-------
77,363
-------
Financials -- 18.0%
American Express 338,000 25,526
Berkshire Hathaway, Cl B* 633,000 71,852
Charles Schwab 1,237,000 26,150
M&T Bank 410,000 45,887
Visa, Cl A 224,000 42,806
-------
212,221
-------
Health Care -- 15.9%
Express Scripts Holding* 1,085,000 67,031
Gilead Sciences* 587,000 36,887
Perrigo 373,000 46,021
Varian Medical Systems* 513,000 38,337
-------
188,276
-------
Industrials -- 11.9%
Cummins 387,000 51,420
Stericycle* 428,000 49,391
Verisk Analytics, Cl A* 606,000 39,366
-------
140,177
-------
Information Technology -- 31.6%
Apple 229,000 109,176
Cognizant Technology
Solutions, Cl A* 834,000 68,488
EMC 2,597,000 66,379
Google, Cl A* 65,000 56,934
QUALCOMM 1,067,000 71,873
-------
372,850
-------
--------------------------------------------------------------------------------
Shares/Face
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
Total Common Stock
(Cost $921,368) (000) $ 1,100,593
-----------
Time Deposit -- 6.6%
Brown Brothers, 0.010%, 10/01/13
(Cost $78,055) (000) $ 78,055 78,055
-----------
Total Investments -- 99.8%
(Cost $999,423) (000) $ 1,178,648
===========
As of September 30, 2013, all of the Fund's investments were
considered Level 1, except for the Time Deposit which was Level 2, in
accordance with the authoritative guidance on fair value measurements
and disclosure under U.S. GAAP. Please see Note 2 in Notes to
Financial Statements for further information regarding fair value
measurements.
Percentages are based on Net Assets of $1,180,687 (000).
* Non-income producing security.
** More narrow industries are utilized for compliance purposes,
whereas broad sectors are utilized for reporting purposes.
Cl -- Class
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
16
[RIVERPARK FUNDS LOGO] RiverPark Short Term High Yield Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
93.9% Corporate Obligations
5.2% Bank Loan Obligations
0.8% Time Deposit
0.1% Preferred Stock
0.0% Asset-Backed Security
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Face Amount
Description (000) Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Corporate Obligations -- 93.7%
Consumer Discretionary -- 30.5%
Allbritton Communications
8.000%, 05/15/18 $ 25,350 $ 27,410
Avis Budget Car Rental
2.764%, 05/15/14 (a) 1,378 1,381
Belo
8.000%, 11/15/16 250 262
Express
8.750%, 03/01/18 16,400 17,507
Fiesta Restaurant Group
8.875%, 08/15/16 250 268
GXS Worldwide
9.750%, 06/15/15 28,256 29,086
Hanesbrands
8.000%, 12/15/16 5,066 5,351
Icahn Enterprises
7.750%, 01/15/16 33,522 34,653
Lamar Media
9.750%, 04/01/14 6,796 7,085
Local TV Finance
9.250%, 06/15/15 (b) 8,471 8,598
Media General
11.750%, 02/15/17 39,374 43,115
Nexstar Broadcasting
8.875%, 04/15/17 13,712 14,953
Nielsen Finance
11.625%, 02/01/14 31,325 32,460
Norcraft
10.500%, 12/15/15 1,745 1,813
Pegasus Solutions
13.000%, 04/15/14 (b) 10,966 10,308
Penn National Gaming
8.750%, 08/15/19 20,702 22,772
Sheridan Group
12.500%, 04/15/14 7,200 7,236
XM Satellite Radio
7.625%, 11/01/18 (b) 2,215 2,464
-------
266,722
-------
--------------------------------------------------------------------------------
Face Amount
Description (000) Value (000)
--------------------------------------------------------------------------------
Consumer Staples -- 0.9%
Beverages & More
9.625%, 10/01/14 (b) $ 7,805 $ 7,844
-------
Energy -- 20.0%
Comstock Resources
8.375%, 10/15/17 28,034 29,282
EPE Holdings/EP Energy Bond
8.125%, 12/15/17 31,509 33,046
Hercules Offshore
10.500%, 10/15/17 (b) 29,100 30,955
McMoRan Exploration
11.875%, 11/15/14 19,243 19,471
Ocean Rig UDW
9.500%, 04/27/16 (b) 22,400 23,856
Panoro Energy
13.500%, 11/15/18 (c) 19,450 3,429
12.000%, 11/15/18 (b) 2,590 2,758
Whiting Petroleum
7.000%, 02/01/14 31,211 31,952
-------
174,749
-------
Financials -- 6.7%
Ally Financial
6.500%, 10/15/16 110 110
Geo Group REIT
7.750%, 10/15/17 10,219 10,682
HUB International
8.125%, 10/15/18 42,753 47,830
------
58,622
------
Health Care -- 4.8%
Bausch & Lomb
9.875%, 11/01/15 7,089 7,142
Vanguard Health Holding II
8.000%, 02/01/18 27,846 29,517
7.750%, 02/01/19 4,750 5,118
------
41,777
------
Industrials -- 5.7%
American Airlines
7.500%, 03/15/16 (b) 16,000 19,040
CNH Capital
6.250%, 11/01/16 5,500 6,078
Continental Airlines Pass-Through
Trust
6.940%, 10/15/13 9 9
Signature Group Holdings
9.000%, 12/31/16 1,000 998
Titan International
7.875%, 10/01/17 (b) 22,526 24,035
------
50,160
------
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
17
[RIVERPARK FUNDS LOGO] RiverPark Short Term High Yield Fund
September 30, 2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Face Amount
Description (000) Value (000)
--------------------------------------------------------------------------------
Information Technology -- 6.1%
Alion Science and Technology
12.000%, 11/01/14 $ 632 $ 642
Freescale Semiconductor Holdings
10.125%, 03/15/18 20,195 22,124
NXP
9.750%, 08/01/18 (b) 6,087 6,854
Stratus Technologies Bermuda
12.000%, 03/29/15 3,733 3,742
Stream Global Services
11.250%, 10/01/14 19,434 19,605
------
52,967
------
Materials -- 6.0%
Airgas
7.125%, 10/01/18 475 492
Appvion
9.750%, 06/15/14 4,806 4,788
Catalyst Paper
13.000%, 09/13/16 (a) (b) 4,533 4,641
Cemex Finance
9.500%, 12/14/16 (b) 5,204 5,523
Consolidated Minerals
8.875%, 05/01/16 (b) 3,700 3,765
Packaging Dynamics
8.750%, 02/01/16 (b) 6,100 6,344
Plastipak Holdings
10.625%, 08/15/19 (b) 20,630 23,498
Pretium Packaging
11.500%, 04/01/16 3,089 3,328
------
52,379
------
Telecommunication Services -- 13.0%
Cincinnati Bell
8.250%, 10/15/17 25,421 26,521
Clearwire Communications
12.000%, 12/01/15 (b) 31,127 32,644
DISH DBS
7.000%, 10/01/13 29,187 29,187
Level 3 Financing
4.146%, 02/15/15 (a) 21,760 21,798
Wind Acquisition Finance
11.750%, 07/15/17 (b) 2,760 2,936
-------
113,086
-------
Total Corporate Obligations
(Cost $819,537) (000) 818,306
-------
--------------------------------------------------------------------------------
Face Amount/
Description Shares (000) Value (000)
--------------------------------------------------------------------------------
Preferred Stock -- 0.1%
Forest City Enterprises
7.375%, 02/01/34
(Cost $523) (000) 26,333 $ 523
--------
Asset-Backed Security -- 0.0%
Other Asset-Backed Security -- 0.0%
Aircraft Certificate Owner Trust,
Ser 2003-1A, Cl D
6.455%, 09/20/22 (b)
(Cost $383) (000) $ 376 376
--------
Bank Loan Obligations -- 5.2%
Armored Autogroup
6.000%, 11/05/16 2,985 2,920
El Pollo Loco
9.250%, 07/14/17 4,937 5,036
Lee Enterprises
7.500%, 12/31/15 18,619 18,406
MediaNews Group
8.500%, 03/19/14 1,188 1,183
Radio One
7.500%, 03/31/16 17,550 17,931
------
Total Bank Loan Obligations
(Cost $45,878) (000) 45,476
------
Time Deposit -- 0.8%
Brown Brothers, 0.010%, 10/01/13
(Cost $7,000) (000) 7,000 7,000
--------
Total Investments -- 99.8%
(Cost $873,321) (000) $871,681
========
As of September 30, 2013, all of the Fund's investments and other
financial instruments were considered Level 2, except for Preferred
Stock which was Level 1, in accordance with the authoritative guidance
on fair value measurements and disclosure under U.S. GAAP. Please
see Note 2 in Notes to Financial Statements for further information
regarding fair value measurements.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
18
[RIVERPARK FUNDS LOGO] RiverPark Short Term High Yield Fund
September 30, 2013
--------------------------------------------------------------------------------
A list of the open forward foreign currency contracts held by the
Fund at September 30, 2013 is as follows++:
Currency to Currency to Unrealized
Settlement Date Deliver (000) Receive (000) Appreciation (000)
--------------------------------------------------------------------------------
10/23/13 NOK 21,205 USD 3,579 $ 56
==========
A list of the counterparties for the open forward foreign currency
contracts held by the Fund at September 30, 2013 is as follows:
Unrealized
Settlement Currency to Currency to Appreciation
Counterparty Date Deliver (000) Receive (000) (000)
--------------------------------------------------------------------------------
Brown Brothers
Harriman 10/23/13 $(3,523) 3,579 $ 56
======
++ See Note 2 in Notes to Financial Statements for additional information.
Percentages are based on Net Assets of $873,077 (000).
(a) Variable rate security - Rate disclosed is the rate in effect on September
30, 2013.
(b) Securities sold within terms of a private placement memorandum, exempt
from registration under Section 144A of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or other
"accredited investors." These securities have been determined to be liquid
under guidelines established by the Board of Trustees.
(c) Face amount is presented in Norwegian Krone.
Cl -- Class
NOK -- Norwegian Krone
REIT-- Real Estate Investment Trust
Ser -- Series
USD -- United States Dollar
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
19
[RIVERPARK FUNDS LOGO] RiverPark Long/Short Opportunity Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
24.0% Information Technology
19.3% Consumer Discretionary
18.3% Financials
9.8% Time Deposit
9.8% Energy
7.3% Industrials
4.8% Telecommunication Services
3.4% Materials
3.3% Health Care
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Common Stock -- 101.4%**
Consumer Discretionary -- 21.7%
Discovery Communications, Cl C* 28,701 $ 2,242
Dollar Tree* (b) 25,177 1,439
Dollarama 29,781 2,420
Fossil Group* 8,292 964
Imax* 20,084 607
Las Vegas Sands 31,535 2,095
priceline.com* (b) 3,331 3,367
Ralph Lauren, Cl A 9,143 1,506
Rentrak* 32,017 1,045
Starbucks 31,509 2,425
Ulta Salon Cosmetics & Fragrance* 8,579 1,025
Walt Disney (b) 15,442 996
Wynn Resorts 8,898 1,406
------
21,537
------
Energy -- 11.0%
Cabot Oil & Gas (b) 62,602 2,336
National Oilwell Varco (b) 45,194 3,530
Noble Energy 17,973 1,204
Schlumberger (b) 16,468 1,455
Southwestern Energy* (b) 63,733 2,319
------
10,844
------
Financials -- 20.6%
American Express 21,953 1,658
Charles Schwab 79,637 1,683
CME Group, Cl A (b) 31,467 2,325
KKR & Co., LP (a) 108,399 2,231
Mastercard, Cl A (b) 1,248 840
TD Ameritrade Holding 76,661 2,007
The Blackstone Group LP (a) 270,504 6,733
Visa, Cl A (b) 15,166 2,898
-------
20,375
------
Health Care -- 3.7%
Accretive Health* (b) 103,232 941
--------------------------------------------------------------------------------
Shares/Face
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
Edwards Lifesciences* 13,122 $ 914
Intuitive Surgical* 2,450 922
Perrigo 7,394 912
-----
3,689
-----
Industrials -- 8.2%
B/E Aerospace* 17,270 1,275
Realogy Holdings* 128,853 5,543
Trimble Navigation* 44,603 1,325
-----
8,143
-----
Information Technology -- 27.0%
Alliance Data Systems* (b) 10,901 2,305
Apple (b) (c) 7,198 3,432
Bankrate* 78,842 1,622
Cognizant Technology
Solutions, Cl A* 38,519 3,163
eBay* (b) 25,559 1,426
Equinix* 31,261 5,741
Genpact 48,497 916
Google, Cl A* 3,262 2,857
QUALCOMM (b) 78,755 5,305
------
26,767
------
Materials -- 3.8%
Monsanto 36,311 3,790
------
Telecommunication Services -- 5.4%
American Tower REIT, Cl A (b) 39,192 2,905
SBA Communications, Cl A* (b) 30,688 2,469
-----
5,374
-----
Total Common Stock
(Cost $88,267) (000) 100,519
-------
Time Deposit -- 11.0%
Brown Brothers, 0.010%, 10/01/13
(Cost $10,893) (000) $10,893 10,893
------
Total Investments -- 112.4%
(Cost $99,160) (000) $ 111,412
---------
Schedule of Securities Sold Short
Common Stock -- (55.4)%
Consumer Discretionary -- (19.7)%
Amazon.com* (2,895) $ (905)
Best Buy (41,529) (1,557)
Burger King Worldwide (76,075) (1,485)
Darden Restaurants (24,074) (1,114)
DeVry (37,795) (1,155)
DIRECTV* (9,789) (585)
GameStop, Cl A (11,516) (572)
Garmin (32,642) (1,475)
Guess? (19,385) (579)
hhgregg* (37,263) (667)
International Game Technology (29,613) (560)
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
20
[RIVERPARK FUNDS LOGO] RiverPark Long/Short Opportunity Fund
September 30, 2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
K12* (17,738) $ (548)
Macy's (12,920) (559)
Netflix* (2,377) (735)
Nielsen Holdings (43,517) (1,586)
Regal Entertainment Group, Cl A (31,369) (596)
Six Flags Entertainment (16,681) (564)
Sony ADR (70,112) (1,509)
Staples (64,839) (950)
Strayer Education (11,907) (494)
Weight Watchers International (17,315) (647)
Wendy's (75,786) (643)
--------
(19,485)
--------
Consumer Staples -- (4.0)%
Coca-Cola (14,986) (568)
Fairway Group Holdings, Cl A* (29,721) (760)
Green Mountain Coffee Roasters* (7,362) (554)
Kroger (24,941) (1,006)
Safeway (34,671) (1,109)
-------
(3,997)
-------
Energy -- (1.8)%
CONSOL Energy (17,541) (590)
First Solar* (15,357) (618)
Peabody Energy (31,182) (538)
------
(1,746)
------
Financials -- (2.5)%
Green Dot, Cl A* (28,838) (759)
Legg Mason (30,627) (1,024)
Progressive (24,817) (676)
-------
(2,459)
-------
Health Care -- (1.5)%
Cerner* (18,078) (950)
Pfizer (20,047) (576)
-------
(1,526)
-------
Industrials -- (4.1)%
General Dynamics (6,593) (577)
Huntington Ingalls Industries (9,340) (629)
Iron Mountain (37,559) (1,015)
Lockheed Martin (4,719) (602)
Northrop Grumman (6,253) (596)
Tyco International (16,938) (592)
-------
(4,011)
-------
Information Technology -- (19.3)%
Activision Blizzard (58,413) (974)
Adobe Systems* (12,175) (632)
Akamai Technologies* (11,730) (606)
Applied Materials (36,945) (648)
Autodesk* (15,181) (625)
Corning (86,014) (1,255)
--------------------------------------------------------------------------------
Shares/
Description Contracts Value (000)
--------------------------------------------------------------------------------
Electronic Arts* (69,584) $ (1,778)
Flextronics International* (116,529) (1,059)
Hewlett-Packard (41,959) (880)
Infosys ADR (12,222) (588)
International Business Machines (3,077) (570)
Intuit (8,914) (591)
Jabil Circuit (26,720) (579)
Juniper Networks* (29,450) (585)
Lexmark International, Cl A (27,529) (909)
Linear Technology (16,527) (656)
Microsoft (42,201) (1,406)
NVIDIA (38,137) (593)
Oracle (17,831) (591)
Rackspace Hosting* (12,560) (663)
SAP ADR (7,181) (531)
Seagate Technology (14,464) (633)
Western Digital (9,042) (573)
Western Union (65,869) (1,229)
--------
(19,154)
--------
Materials -- (0.8)%
Glencore Xstrata (148,343) (809)
--------
Telecommunication Services -- (1.7)%
AT&T (16,980) (574)
j2 Global (11,900) (589)
Sprint* (87,572) (544)
-------
(1,707)
-------
Total Common Stock
(Proceeds $51,043) (000) (54,894)
--------
Total Securities Sold Short
(Proceeds $51,043) (000) $ (54,894)
==========
Schedule of Open Options Purchased
Purchased Option -- 0.1%*++
Apple, Call Option
Expires 10/19/13, Strike
Price $430 20 $ 96
(Cost $66) (000) ======
Schedule of Open Options Written
Written Option -- 0.0%*++
Apple, Call Option
Expires 10/19/13, Strike
Price $500 (20) $ (9)
(Premiums Received $24) (000) ======
++ See Note 2 in Notes to Financial Statements for additional information.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
21
[RIVERPARK FUNDS LOGO] RiverPark Long/Short Opportunity Fund
September 30, 2013
--------------------------------------------------------------------------------
The following is a summary of the inputs used as of September 30, 2013
in valuing the Fund's investments, liabilities and other financial instruments
carried at value (000):
Investments in Securities Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Common Stock $ 100,519 $ -- $ -- $ 100,519
Time Deposit -- 10,893 -- 10,893
--------------------------------------------
Total Investments in Securities $ 100,519 $ 10,893 $ -- $ 111,412
============================================
Liabilities Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Common Stock $ (54,894) $ -- $ -- $ (54,894)
---------------------------------------------
Total Liabilities $ (54,894) $ -- $ -- $ (54,894)
=============================================
Other Financial Instruments Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Purchased Option $ 96 $ -- $ -- $ 96
Written Option (9) -- -- (9)
Total Return Swaps^ -- -- -- --
--------------------------------------------
Total Other Financial Instruments $ 87 $ -- $ -- $ 87
============================================
^ As of September 30, 2013, the swaps are considered Level 2. See Note 2 in
Notes to Financial Statements for additional information.
Please see Note 2 in Notes to Financial Statements for further
information regarding fair value measurements.
A list of open swap agreements held by the Fund at September 30, 2013, was as
follows:
------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN SWAPS
------------------------------------------------------------------------------------------------------------------------------------
Net Unrealized
Notional Appreciation
Reference Entity/ Fund Termination Amount (Depreciation)
Counterparty Obligation Fund Pays Receives Date Contracts (000) (000)
---------------------------------------------------------------------------------------------------------------------------------
Goldman Sachs Accretive Health Fed Funds 1-Day - 0.45% Total Return 09/04/14 3,155 29 $ --
Goldman Sachs Alliance Data Systems Fed Funds 1-Day - 0.45% Total Return 09/10/14 202 43 --
Goldman Sachs American Tower Fed Funds 1-Day - 0.45% Total Return 10/11/13 612 45 --
Goldman Sachs Apple Fed Funds 1-Day - 0.45% Total Return 07/03/14 643 307 --
Goldman Sachs Cabot Oil & Gas Fed Funds 1-Day - 0.45% Total Return 10/11/13 720 27 --
Goldman Sachs CME Group Fed Funds 1-Day - 0.45% Total Return 10/11/13 412 30 --
Goldman Sachs Dollar Tree Fed Funds 1-Day - 0.45% Total Return 09/04/14 24,188 1,383 --
Goldman Sachs eBay Fed Funds 1-Day - 0.45% Total Return 06/12/14 25,000 1,395 --
Goldman Sachs Mastercard Fed Funds 1-Day - 0.45% Total Return 09/04/14 2,210 1,487 --
Goldman Sachs National Oilwell Varco Fed Funds 1-Day - 0.45% Total Return 05/30/14 422 33 --
Goldman Sachs priceline.com Fed Funds 1-Day - 0.45% Total Return 06/04/14 66 67 --
Goldman Sachs QUALCOMM Fed Funds 1-Day - 0.45% Total Return 11/14/13 2,775 187 --
Goldman Sachs SBA Communications Fed Funds 1-Day - 0.45% Total Return 10/11/13 842 68 --
Goldman Sachs Schlumberger Fed Funds 1-Day - 0.45% Total Return 09/04/14 1,032 91 --
Goldman Sachs Southwestern Energy Fed Funds 1-Day - 0.45% Total Return 06/12/14 56,000 2,037 --
Goldman Sachs Visa Fed Funds 1-Day - 0.45% Total Return 06/04/14 702 134 --
Goldman Sachs Walt Disney Fed Funds 1-Day - 0.45% Total Return 07/03/14 18,471 1,191 --
----
$ --
=====
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
22
[RIVERPARK FUNDS LOGO] RiverPark Long/Short Opportunity Fund
September 30, 2013
--------------------------------------------------------------------------------
Percentages are based on Net Assets of $99,096 (000).
* Non-income producing security.
** More narrow industries are utilized for compliance purposes, whereas broad
sectors are utilized for reporting purposes.
(a) Security considered Master Limited Partnership. At September 30, 2013,
these securities amounted to $8,964 (000) or 9.0% of Net Assets.
(b) Underlying security for a total return swap.
(c) Underlying security for a purchased/written call/put option.
ADR -- American Depositary Receipt
Cl -- Class
LP -- Limited Partnership
REIT -- Real Estate Investment Trust
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
23
[RIVERPARK FUNDS LOGO] RiverPark/Gargoyle Hedged Value Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
21.3% Information Technology
16.6% Health Care
13.3% Consumer Discretionary
12.4% Financials
10.9% Energy
10.4% Industrials
7.5% Materials
5.5% Consumer Staples
1.5% Telecommunication Services
0.6% Time Deposit
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Common Stock -- 102.1%
Consumer Discretionary -- 13.6%
Apollo Group, Cl A* (a) 14,110 $ 294
Dana Holding (a) 18,900 432
Dillard's, Cl A (a) 5,430 425
DreamWorks Animation SKG,
Cl A*(a) 6,692 190
Ford Motor (a) 24,530 414
General Motors* (a) 10,670 384
Goodyear Tire & Rubber* (a) 10,350 232
Lions Gate Entertainment* 1,700 60
MGM Resorts International* (a) 19,858 406
PulteGroup (a) 14,360 237
Staples (a) 25,700 376
Time Warner Cable (a) 4,060 453
-----
3,903
-----
Consumer Staples -- 5.7%
Kroger (a) 9,780 395
Molson Coors Brewing, Cl B (a) 7,660 384
Safeway (a) 16,110 515
Tyson Foods, Cl A (a) 11,465 324
-----
1,618
-----
Energy -- 11.2%
Apache (a) 2,250 192
CVR Energy (a) 5,846 225
First Solar* (a) 9,244 372
HollyFrontier (a) 6,128 258
Marathon Oil 2,908 101
Nabors Industries (a) 21,400 344
Newfield Exploration* (a) 11,400 312
Peabody Energy (a) 14,600 252
RPC (a) 22,760 352
SandRidge Energy* (a) 18,220 107
Superior Energy Services* 6,800 170
Tesoro (a) 4,752 209
--------------------------------------------------------------------------------
Description Shares Value (000)
--------------------------------------------------------------------------------
Valero Energy (a) 9,050 $ 309
-------
3,203
-------
Financials -- 12.8%
American Capital* (a) 25,800 355
American International Group (a) 4,250 207
Bank of New York Mellon (a) 9,318 281
Erie Indemnity, Cl A (a) 4,301 312
Genworth Financial, Cl A* (a) 28,450 364
Jones Lang LaSalle (a) 3,590 313
Legg Mason (a) 11,525 386
Leucadia National (a) 14,084 384
NASDAQ OMX Group (a) 6,704 215
PartnerRe (a) 3,710 339
Reinsurance Group of America,
Cl A (a) 4,804 322
RenaissanceRe Holdings (a) 970 88
XL Group, Cl A 3,200 98
-----
3,664
-----
Health Care -- 17.0%
Abbott Laboratories (a) 8,390 279
Alere* 5,650 173
Allscripts Healthcare Solutions* (a) 19,310 287
Amgen (a) 2,460 275
Celgene* (a) 3,148 485
Community Health Systems (a) 7,000 291
Eli Lilly (a) 5,633 283
Endo Health Solutions* (a) 7,760 353
Express Scripts Holding* (a) 5,100 315
Jazz Pharmaceuticals* (a) 5,670 521
Medtronic (a) 5,342 284
Mylan* (a) 10,550 403
Myriad Genetics* (a) 4,777 112
United Therapeutics* (a) 5,020 396
WellCare Health Plans* (a) 5,940 414
-----
4,871
-----
Industrials -- 10.7%
Joy Global (a) 6,750 345
Manpowergroup 2,300 167
Northrop Grumman (a) 4,277 407
Oshkosh* (a) 6,655 326
Pentair (a) 4,880 317
Pitney Bowes (a) 25,100 457
Textron (a) 11,480 317
Timken (a) 5,964 360
URS (a) 7,000 376
-----
3,072
-----
Information Technology -- 21.8%
Activision Blizzard (a) 25,171 420
AOL* (a) 9,696 335
Apple (a) 790 377
Brocade Communications
Systems* (a) 36,700 295
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
24
[RIVERPARK FUNDS LOGO] RiverPark/Gargoyle Hedged Value Fund
September 30, 2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shares/Face
Description Amount (000) Value (000)
--------------------------------------------------------------------------------
Computer Sciences (a) 8,071 $ 418
Flextronics International* (a) 47,067 428
Harris (a) 4,004 238
Hewlett-Packard (a) 20,850 437
IAC (a) 6,950 380
Itron* (a) 4,918 210
KLA-Tencor (a) 5,700 347
Leidos Holdings* 3,690 168
Lexmark International, Cl A (a) 5,600 185
NVIDIA (a) 21,000 326
Science Applications International 2,108 71
Seagate Technology (a) 8,930 390
Sohu.com* (a) 3,604 284
Symantec (a) 9,902 245
VeriFone Systems* (a) 11,680 267
VeriSign* 3,300 168
Vishay Intertechnology* (a) 4,633 60
Yahoo!* 6,230 207
-----
6,256
-----
Materials -- 7.7%
Alcoa (a) 44,957 365
CF Industries Holdings 1,110 234
Domtar (a) 2,920 232
Freeport-McMoRan Copper & Gold 11,500 380
Huntsman (a) 16,800 346
Tronox, Cl A (a) 17,200 421
United States Steel (a) 11,350 234
-----
2,212
-----
Telecommunication Services -- 1.6%
Telephone & Data Systems (a) 13,090 387
United States Cellular* 1,502 68
---
455
---
Total Common Stock
(Cost $23,243) (000) 29,254
======
Time Deposit -- 0.5%
Brown Brothers, 0.010%, 10/01/13
(Cost $165) (000) $165 165
--------
Total Investments -- 102.6%
(Cost $23,408) (000) $ 29,419
--------
--------------------------------------------------------------------------------
Description Contracts Value (000)
--------------------------------------------------------------------------------
Schedule of Open Options Written
Written Options -- (2.0)%*++
CBOE Russell 2000 Index, Call Option,
Expires 10/19/13, Strike Price $1,060 (5) $ (14)
Expires 10/19/13, Strike Price $1,070 (15) (31)
Expires 10/19/13, Strike Price $1,030 (50) (256)
Expires 10/19/13, Strike Price $1,050 (38) (132)
NASDAQ 100 Index, Call Option,
Expires 10/19/13, Strike Price $3,275 (5) (9)
S&P 500 Index, Call Option,
Expires 10/19/13, Strike Price $1,700 (4) (5)
Expires 10/19/13, Strike Price $1,740 (5) (1)
Expires 10/19/13, Strike Price $1,710 (11) (9)
Expires 11/16/13, Strike Price $1,715 (7) (12)
Expires 10/19/13, Strike Price $1,655 (22) (85)
Expires 10/19/13, Strike Price $1,715 (15) (15)
Expires 10/19/13, Strike Price $1,710 (14) (17)
------
Total Written Options
(Premiums Received $353) (000) $ (586)
======
++ See Note 2 in Notes to Financial Statements for additional information.
The following is a summary of the inputs used as of September 30,
2013 in valuing the Fund's investments and other financial instruments
carried at value (000):
Investments in Securities Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Common Stock $ 29,254 $ -- $ -- $ 29,254
Time Deposit -- 165 -- 165
----------------------------------------------
Total Investments in Securities $ 29,254 $ 165 $ -- $ 29,419
==============================================
Other Financial Instruments Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Written Options $ (586) $ -- $ -- $ (586)
-----------------------------------------------
Total Other Financial
Instruments $ (586) $ -- $ -- $ (586)
===============================================
Please see Note 2 in Notes to Financial Statements for further
information regarding fair value measurements.
Percentages are based on Net Assets of $28,656 (000).
* Non-income producing security.
(a) Pledged as collateral for open options written.
CBOE -- Chicago Board Options Exchange
Cl -- Class
S&P -- Standard & Poor's
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
25
[RIVERPARK FUNDS LOGO] RiverPark Structural Alpha Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
75.1% Time Deposit
24.9% U.S. Treasury Obligations
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Face
Amount
(000)/ Value
Description Contracts (000)
--------------------------------------------------------------------------------
Schedule of Investments
U.S. Treasury Obligations -- 22.2%
U.S. Treasury Bills (a) (b)
0.025%, 10/31/13 $ 1,000 $ 1,000
0.000%, 12/19/13 1,000 1,000
-------
Total U.S. Treasury Obligations
(Cost $2,000) (000) 2,000
-------
Time Deposit -- 66.9%
Brown Brothers, 0.010%, 10/01/13
(Cost $6,022) (000) 6,022 6,022
-------
Total Investments -- 89.1%
(Cost $8,022) (000) $ 8,022
=======
Schedule of Open Options Purchased
Purchased Options -- 10.5% *++
S&P 500 Index, Call Option
Expires 12/20/14, Strike Price $1,625 12 $ 163
Expires 06/21/14, Strike Price $1,550 12 201
Expires 12/21/13, Strike Price $1,500 12 226
Expires 07/01/14, Strike Price $1,625 12 141
Expires 03/22/14, Strike Price $1,575 12 166
S&P 500 Index, Put Option
Expires 01/02/14, Strike Price $1,600 18 49
-----
Total Purchased Options
(Cost $782) (000) $ 946
=====
--------------------------------------------------------------------------------
Description Contracts Value (000)
--------------------------------------------------------------------------------
Schedule of Open Options Written
Written Options -- (6.7)% *++
CBOE S&P 500 Index, Call Option
Expires 10/19/13, Strike Price $1,710 (2) $ (1)
Expires 10/19/13, Strike Price $1,680 (5) (7)
CBOE S&P 500 Index, Put Option
Expires 10/19/13, Strike Price $1,600 (5) --
Expires 10/19/13, Strike Price $1,550 (2) (1)
S&P 500 Index, Call Option
Expires 11/16/13, Strike Price $1,715 (5) (6)
Expires 10/28/13, Strike Price $1,780 (2) --
Expires 06/21/14, Strike Price $1,700 (12) (86)
Expires 10/19/13, Strike Price $1,800 (2) --
Expires 10/28/13, Strike Price $1,740 (5) (2)
Expires 12/20/14, Strike Price $1,825 (12) (56)
Expires 10/19/13, Strike Price $1,765 (5) --
Expires 10/13/13, Strike Price $1,765 (2) --
Expires 10/13/13, Strike Price $1,725 (5) (1)
Expires 12/21/13, Strike Price $1,600 (12) (124)
Expires 01/02/14, Strike Price $1,625 (6) (51)
Expires 03/22/14, Strike Price $1,700 (12) (68)
Expires 07/01/14, Strike Price $1,775 (12) (48)
S&P 500 Index, Put Option
Expires 10/19/13, Strike Price $1,685 (5) (11)
Expires 11/16/13, Strike Price $1,635 (5) (8)
Expires 12/20/14, Strike Price $1,475 (6) (40)
Expires 06/21/14, Strike Price $1,400 (6) (15)
Expires 10/28/13, Strike Price $1,650 (5) (8)
Expires 10/13/13, Strike Price $1,605 (2) (1)
Expires 10/19/13, Strike Price $1,640 (2) (2)
Expires 10/28/13, Strike Price $1,600 (2) (1)
Expires 10/13/13, Strike Price $1,645 (5) (4)
Expires 07/01/14, Strike Price $1,500 (6) (26)
Expires 10/01/13, Strike Price $1,300 (6) --
Expires 01/02/14, Strike Price $1,500 (18) (20)
Expires 03/22/14, Strike Price $1,425 (6) (11)
Expires 12/21/13, Strike Price $1,400 (6) (3)
------
Total Written Options
(Premiums Received $621) (000) $ (601)
======
++ See Note 2 in Notes to Financial Statements for additional information.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
26
[RIVERPARK FUNDS LOGO] RiverPark Structural Alpha Fund
September 30, 2013
--------------------------------------------------------------------------------
The following is a summary of the inputs used as of September 30,
2013 in valuing the Fund's investments and other financial instruments
carried at value (000):
Investments in Securities Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
U.S. Treasury Obligations $ -- $ 2,000 $ -- $ 2,000
Time Deposit -- 6,022 -- 6,022
-------------------------------------
Total Investments in Securities $ -- $ 8,022 $ -- $ 8,022
=====================================
Other Financial Instruments Level 1 Level 2 Level 3 Total
--------------------------------------------------------------------------------
Purchased Options $ 946 $ -- $ -- $ 946
Written Options (601) -- -- (601)
Futures Contracts *
Unrealized Appreciation 11 -- -- 11
-------------------------------------
Total Other Financial Instruments $ 356 $ -- $ -- $ 356
=====================================
* Futures contracts are valued at the unrealized appreciation on the
instrument. See Note 2 in Notes to Financial Statements for additional
information.
Please see Note 2 in Notes to Financial Statements for further
information regarding fair value measurements.
The open futures contracts held by the Fund at September 30, 2013 are as
follows:
Number of
Contracts Expiration Unrealized
Counterparty Type of Contract Long (Short) Date Appreciation (000)
-----------------------------------------------------------------------------------------------------------
Interactive Brokers LLC S&P 500 Index EMINI (10) Dec-2013 $ 11
====
Percentages are based on Net Assets of $9,003 (000).
* Non-income producing security.
(a) Zero coupon security. The rate reported on the Schedule of Investments is
the effective yield at time of purchase.
(b) Pledged as collateral for open futures contracts.
CBOE -- Chicago Board Options Exchange
S&P -- Standard & Poor's
Amounts designated as "-" are $0 or rounded to $0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
27
[RIVERPARK FUNDS LOGO] RiverPark Strategic Income Fund
September 30, 2013
--------------------------------------------------------------------------------
Sector Weighting+
100.0% Time Deposit
+ Percentages are based on total investments.
--------------------------------------------------------------------------------
Face Amount
Description (000) Value (000)
--------------------------------------------------------------------------------
Schedule of Investments
Time Deposit -- 96.4%
Brown Brothers, 0.010%, 10/01/13
(Cost $2,000) (000) $2,000 $2,000
------
Total Investments -- 96.4%
(Cost $2,000) (000) $2,000
======
As of September 30, 2013, the Fund's investment was Level 2 in
accordance with the authoritative guidance on fair value measurements
and disclosure under U.S. GAAP. Please see Note 2 in Notes to
Financial Statements for further information regarding fair value
measurements.
Percentages are based on Net Assets of $2,075 (000).
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
28
Statements of Assets and Liabilities (000) [RIVERPARK FUNDS LOGO]
September 30, 2013
--------------------------------------------------------------------------------
RiverPark
RiverPark RiverPark/ RiverPark Long/Short
Large Wedgewood Short Term Opportunity
Growth Fund Fund High Yield Fund Fund
------------------------------------------------------------------------------------------------------------------------------------
Assets:
Investments in Securities, at Value (Note 2) $ 32,731 $ 1,178,648 $ 871,681 $ 111,412
Purchased Options, at Value -- -- -- 96
Deposits with Brokers for Securities Sold Short -- -- -- 44,238
Receivable due from Affiliate -- 212 -- --
Receivable for Capital Shares Sold 60 4,525 10,581 295
Other Prepaid Expenses 17 126 67 23
Receivable for Swap Reset -- -- -- 397
Receivable for Dividend and Interest Income 8 415 20,716 20
Cash Collateral on Swap Contracts -- -- -- 250
Unrealized Appreciation on Forward Foreign Currency Contracts -- -- 56 --
------ --------- ------- -------
Total Assets 32,816 1,183,926 903,101 156,731
------ --------- ------- -------
Liabilities:
Securities Sold Short, at Value (Note 2) -- -- -- 54,894
Written Options, at Value (Note 2) -- -- -- 9
Payable for Investment Securities Purchased 147 -- 26,679 373
Payable for Capital Shares Redeemed 51 1,580 1,646 2,071
Income Distribution Payable -- -- 259 --
Payable due to Affiliate -- -- 212 --
Dividends Payable on Securities Sold Short -- -- -- 56
Payable Due to Adviser (Note 3) 36 628 581 118
Payable Due to Shareholder Servicing Agent (Note 3) 34 359 115 28
Payable Due to Administrative Services Plan, Institutional
Class Shares (Note 3) 1 194 174 7
Payable Due to Administrative Services Plan, Retail Class
Shares (Note 3) 6 160 86 18
Payable Due to Administrator 2 89 65 7
Payable Due to Trustees -- 11 8 1
Chief Compliance Officer Fees Payable -- 4 3 1
Other Accrued Expenses 19 214 196 52
------------- ---------- ----------- ----------
Total Liabilities 296 3,239 30,024 57,635
------------- ---------- ----------- ----------
Net Assets $ 32,520 $1,180,687 $ 873,077 $ 99,096
============= ========== =========== ==========
Net Assets Consist of:
Paid-in Capital $ 25,858 $1,001,915 $ 874,837 $ 95,728
Undistributed Net Investment Income 110 -- 29 237
Accumulated Net Realized Gain (Loss) on Investments,
Securities Sold Short, Purchased & Written Options,
and Swap Contracts 115 (453) (203) (5,315)
Net Unrealized Appreciation (Depreciation) on Investments
and Securities Sold Short 6,437 179,225 (1,640) 8,401
Net Unrealized Appreciation on Purchased and Written Options -- -- -- 45
Net Unrealized Appreciation on Forward Foreign Currency Contracts -- -- 56 --
Net Unrealized Depreciation on Foreign Currency Translation -- -- (2) --
------------ ---------- ----------- ----------
Net Assets $ 32,520 $1,180,687 $ 873,077 $ 99,096
============ ========== =========== ==========
Investments in Securities, at Cost $ 26,294 $ 999,423 $ 873,321 $ 99,160
Securities Sold Short, Proceeds -- -- -- 51,043
Purchased Option, at Cost -- -- -- 66
Written Option, Premiums Received -- -- -- 24
Net Assets - Institutional Class Shares(1) $ 6,298,996 $834,476,326 $587,334,270 $ 26,685,828
============ ============ ============ ============
Net Assets - Retail Class Shares(1) $ 26,221,356 $346,210,687 $285,742,452 $ 72,410,313
============ ============ ============ ============
Institutional Class Shares:
Outstanding Shares of Beneficial Interest(1)
(Unlimited Authorization -- No Par Value) 386,924 51,486,108 58,878,138 2,641,989
============ ============ ============ ============
Retail Class Shares:
Outstanding Shares of Beneficial Interest(1)
(Unlimited Authorization -- No Par Value) 1,620,404 21,513,341 28,672,873 7,186,766
============ ============ ============ ============
Institutional Class Shares:
Net Asset Value, Offering and Redemption
Price Per Share -- Institutional Class Shares $ 16.28 $16.21 $9.98 $10.10
============ ============ ============ ============
Retail Class Shares:
Net Asset Value, Offering and Redemption
Price Per Share -- Retail Class Shares $ 16.18 $16.09 $9.97 $10.08
============ ============ ============ ============
(1) Shares and Net Assets have not been rounded.
Amounts designated as "--" are either not applicable, $0 or have been rounded to
$0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
29
Statements of Assets and Liabilities (000) [RIVERPARK FUNDS LOGO]
September 30, 2013
--------------------------------------------------------------------------------
RiverPark
RiverPark/Gargoyle RiverPark Structural Strategic
Hedged Value Fund Alpha Fund Income Fund
------------------------------------------------------------------------------------------------------------------------------------
Assets:
Investments in Securities, at Value (Note 2) $ 29,419 $ 8,022 $ 2,000
Purchased Options, at Value -- 946 --
Deposits with Brokers for Options and Futures -- 464 --
Receivable for Investment Securities Sold 97 292 --
Receivable for Capital Shares Sold 41 10 75
Receivable for Dividend and Interest Income 15 -- --
Other Prepaid Expenses 12 4 --
Deferred Offering Costs -- 37 --
Receivable for Variation Margin -- 6 --
--------- ------------ ---------
Total Assets 29,584 9,781 2,075
--------- ------------ ---------
Liabilities:
Written Options, at Value (Note 2) 586 601 --
Payable for Investment Securities Purchased 278 128 --
Payable for Capital Shares Redeemed -- 4 --
Payable Due to Adviser (Note 3) 20 5 --
Payable Due to Administrator 2 1 --
Payable Due to Administrative Services Plan, Institutional
Class Shares (Note 3) 1 -- --
Payable Due to Administrative Services Plan, Retail
Class Shares (Note 3) 1 -- --
Payable Due to Broker 18 -- --
Payable Due to Shareholder Servicing Agent (Note 3) -- 1 --
Other Accrued Expenses 22 38 --
------------ ------------- -------------
Total Liabilities 928 778 --
------------ ------------- -------------
Net Assets $ 28,656 $ 9,003 $ 2,075
============ ============= =============
Net Assets Consist of:
Paid-in Capital $ 22,228 $ 8,896 $ 2,075
Undistributed Net Investment Income 137 -- --
Accumulated Net Realized Gain (Loss) on Investments,
Purchased & Written Options and Futures Contracts 513 (88) --
Net Unrealized Appreciation on Investments 6,011 -- --
Net Unrealized Appreciation (Depreciation) on Purchased
and Written Options (233) 184 --
Net Unrealized Appreciation on Futures Contracts -- 11 --
------------ ------------- -------------
Net Assets $ 28,656 $ 9,003 $ 2,075
============ ============= =============
Investments in Securities, at Cost $ 23,408 $ 8,022 $ 2,000
Purchased Options, at Cost -- 782 --
Written Options, Premiums Received 353 621 --
Net Assets - Institutional Class Shares(1) $ 20,122,367 $ 8,117,513 $ 2,000,100
============ ============= =============
Net Assets - Retail Class Shares(1) $ 8,533,268 $ 885,450 $ 75,100
============ ============= =============
Institutional Class Shares:
Outstanding Shares of Beneficial Interest(1)
(Unlimited Authorization -- No Par Value) 1,613,037 801,735 200,010
============ ============= =============
Retail Class Shares:
Outstanding Shares of Beneficial Interest(1)
(Unlimited Authorization -- No Par Value) 686,120 87,491 7,510
============ ============= =============
Institutional Class Shares:
Net Asset Value, Offering and Redemption
Price Per Share -- Institutional Class Shares $ 12.47 $ 10.12 $ 10.00
============ ============= =============
Retail Class Shares:
Net Asset Value, Offering and Redemption
Price Per Share -- Retail Class Shares $ 12.44 $ 10.12 $ 10.00
============ ============= =============
(1) Shares and Net Assets have not been rounded.
Amounts designated as "--" are either not applicable, $0 or have been rounded to
$0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
30
Statements of Operations (000) [RIVERPARK FUNDS LOGO]
For the Year Ended
September 30, 2013
--------------------------------------------------------------------------------
RiverPark Large RiverPark/ RiverPark Short Term
Growth Fund Wedgewood Fund High Yield Fund
Investment Income:
Dividends $ 333 $ 6,555 $ 413
Interest -- 15 26,213
Foreign Taxes Withheld -- -- (5)
-------- ------- -------
Total Investment Income 333 6,570 26,621
-------- ------- -------
Expenses:
Investment Advisory Fees (Note 3) 165 4,986 3,511
Shareholder Service Fees(1) (Note 3) 51 581 544
Administrator Fees (Note 3) 26 760 533
Administrative Services Fee, Institutional Class Shares (Note 3) 3 255 245
Administrative Services Fee, Retail Class Shares (Note 3) 12 116 300
Chief Compliance Officer Fees (Note 3) 2 25 18
Trustees' Fees (Note 3) -- 18 12
Registration Fees 25 157 136
Professional Fees 13 88 63
Transfer Agent Fees 10 309 220
Custodian Fees 2 13 15
Printing Fees 2 77 56
Insurance and Other Fees 10 26 30
-------- ------- -------
Total Expenses 321 7,411 5,683
-------- ------- -------
Fees Waived by Adviser (Note 3) (16) -- --
Advisory Waiver Recapture (Note 3) -- 215 253
-------- ------- -------
Net Expenses 305 7,626 5,936
-------- ------- -------
Net Investment Income (Loss) 28 (1,056) 20,685
-------- ------- -------
Net Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) from:
Investments 225 785 (2,541)
Forward Foreign Currency Contracts -- -- 61
Foreign Currency Transactions (2) -- (27)
Net Change in Unrealized Appreciation (Depreciation) on:
Investments 5,176 136,807 (1,883)
Forward Foreign Currency Contracts -- -- 56
Foreign Currency Translation -- -- (2)
-------- ------- -------
Net Realized and Unrealized Gain (Loss) 5,399 137,592 (4,336)
-------- ------- -------
Net Increase in Net Assets Resulting from Operations $ 5,427 $136,536 $16,349
======== ======= =======
(1) Attributable to Retail Class Shares only.
Amounts designated as "--" are either not applicable, $0 or have been rounded to
$0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
31
Statements of Operations (000) [RIVERPARK FUNDS LOGO]
For the Year or Period Ended
September 30, 2013
--------------------------------------------------------------------------------
RiverPark Long/Short RiverPark/Gargoyle RiverPark Structural
Opportunity Fund Hedged Value Fund Alpha Fund*
Investment Income:
Dividends $ 653 $ 494 $ --
Interest 1 -- 1
Foreign Taxes Withheld (4) -- --
------- ------- ------
Total Investment Income 650 494 1
------- ------- ------
Expenses:
Investment Advisory Fees (Note 3) 768 206 31
Shareholder Service Fees(1) (Note 3) 65 11 1
Administrator Fees (Note 3) 50 23 2
Administrative Services Fee, Institutional Class Shares (Note 3) 26 13 1
Administrative Services Fee, Retail Class Shares (Note 3) 21 3 --
Chief Compliance Officer Fees (Note 3) 2 2 --
Dividend Expense 565 -- --
Stock Loan Fee 262 -- --
Registration Fees 33 23 2
Offering Costs 22 34 19
Transfer Agent Fees 21 9 1
Professional Fees 16 16 8
Custodian Fees 5 5 --
Printing Fees 5 2 --
Insurance and Other Fees 12 9 --
------- ------- ------
Total Expenses 1,873 356 65
------- ------- ------
Fees Waived by Adviser (Note 3) (59) (58) (27)
------- ------- ------
Net Expenses 1,814 298 38
------- ------- ------
Net Investment Income (Loss) (1,164) 196 (37)
------- ------- ------
Net Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) From:
Investments 11 2,212 --
Securities Sold Short (5,310) -- --
Purchased Options (190) -- 60
Written Options 113 (2,106) (36)
Swap Contracts 743 -- --
Futures Contracts -- -- (75)
Foreign Currency Transactions (1) -- --
Net Change in Unrealized Appreciation (Depreciation) on:
Investments 11,912 5,572 --
Purchased Options 95 -- 164
Written Options 15 (378) 20
Securities Sold Short (4,116) -- --
Futures Contracts -- -- 11
------- ------- ------
Net Realized and Unrealized Gain 3,272 5,300 144
------- ------- ------
Net Increase in Net Assets Resulting from Operations $ 2,108 $ 5,496 $ 107
======= ======= ======
* Fund commenced operations on June 28, 2013.
(1) Attributable to Retail Class Shares only.
Amounts designated as "--" are either not applicable, $0 or have been rounded to
$0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
32
Statements of Changes in Net Assets (000) [RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
RiverPark Large Growth Fund RiverPark/Wedgewood Fund
-------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
September 30, September 30, September 30, September 30,
2013 2012 2013 2012
-------------------------------------------------------------
Operations:
Net Investment Income (Loss) $ 28 $ (2) $ (1,056) $ (1,069)
Net Realized Gain from Investments 223 98 785 2,767
Net Change in Unrealized Appreciation on Investments 5,176 1,398 136,807 43,493
-------- -------- -------- --------
Net Increase in Net Assets Resulting from Operations 5,427 1,494 136,536 45,191
-------- -------- -------- --------
Distributions to Shareholders From:
Net Investment Income:
Institutional Class Shares (7) -- -- --
Retail Class Shares (15) -- -- --
Net Realized Gains:
Institutional Class Shares (17) -- (1,058) --
Retail Class Shares (74) -- (540) --
-------- -------- -------- --------
Total Distributions to Shareholders (113) -- (1,598) --
-------- -------- -------- --------
Capital Share Transactions:
Institutional Class Shares:
Shares Issued 1,421 255 590,737 234,071
Shares Issued as Reinvestment of Distributions 24 -- 755 --
Shares Redeemed -- -- (132,831) (14,322)
-------- -------- -------- --------
Net Increase in Net Assets from Institutional Class
Shares Transactions 1,445 255 458,661 219,749
-------- -------- -------- --------
Retail Class Shares:
Shares Issued 10,639 14,895 200,284 168,353
Shares Issued as Reinvestment of Distributions 89 -- 536 --
Shares Redeemed (4,154) (355) (66,330) (13,940)
-------- -------- -------- --------
Net Increase in Net Assets from Retail Class Shares
Transactions 6,574 14,540 134,490 154,413
-------- -------- -------- --------
Net Increase in Net Assets from Capital Share
Transactions 8,019 14,795 593,151 374,162
-------- -------- -------- --------
Net Increase in Net Assets 13,333 16,289 728,089 419,353
Net Assets:
Beginning of Year 19,187 2,898 452,598 33,245
-------- -------- -------- --------
End of Year $ 32,520 $ 19,187 $ 1,180,687 $ 452,598
======== ======== =========== ==========
Undistributed Net Investment Income $ 110 $ 8 $ -- $ --
======== ======== =========== ==========
Shares Issued and Redeemed:
Institutional Class Shares:
Shares Issued 98 23 40,167 18,019
Shares Issued as Reinvestment of Distributions 2 -- 54 --
Shares Redeemed -- -- (8,834) (1,118)
-------- -------- -------- --------
Net Increase in Institutional Class Shares 100 23 31,387 16,901
-------- -------- -------- --------
Retail Class Shares:
Shares Issued 737 1,170 13,521 13,618
Shares Issued as Reinvestment of Distributions 7 -- 39 --
Shares Redeemed (289) (28) (4,608) (1,080)
-------- -------- -------- --------
Net Increase in Retail Class Shares 455 1,142 8,952 12,538
-------- -------- -------- --------
Net Increase in Share Transactions 555 1,165 40,339 29,439
======== ======== =========== ==========
Amounts designated as "--" are either not applicable, $0 or have been rounded
to $0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
33
Statements of Changes in Net Assets (000) [RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
RiverPark Short Term RiverPark
High Yield Fund Long/Short Opportunity Fund
-------------------------------------------------------------
Year Ended Year Ended Year Ended Period
September 30, September 30, September 30, September 30,
2013 2012 2013 2012*
-------------------------------------------------------------
Operations:
Net Investment Income (Loss) $ 20,685 $ 3,914 $ (1,164) $ (207)
Net Realized Gain (Loss) from Investments,
Purchased and Written Options, Swap
Contracts, Securities Sold Short, Forward
Foreign Currency Contracts and Foreign
Currency Transactions (2,507) (51) (4,634) 158
Net Change in Unrealized Appreciation (Depreciation)
on Investments, Purchased and Written Options,
Swap Contracts, Securities Sold Short, Forward Foreign
Currency Contracts and Foreign Currency Transactions (1,829) 429 7,906 540
--------- --------- --------- -------
Net Increase in Net Assets Resulting from Operations 16,349 4,292 2,108 491
--------- --------- --------- -------
Distributions to Shareholders From:
Net Investment Income:
Institutional Class Shares (11,095) (2,416) -- --
Retail Class Shares (7,170) (1,431) -- --
Net Realized Gains:
Institutional Class Shares -- -- (199) --
Retail Class Shares -- -- (48) --
--------- --------- --------- -------
Total Distributions to Shareholders (18,265) (3,847) (247) --
--------- --------- --------- -------
Capital Share Transactions:
Institutional Class Shares:
Shares Issued 586,205 92,917 17,104 9,038
Shares Issued in Connection with In-Kind
Contribution (see Note 5) -- -- -- 10,680
Shares Issued as Reinvestment of Distributions 9,555 2,389 198 --
Shares Redeemed (107,432) (14,327) (10,742) (109)
--------- --------- --------- -------
Net Increase in Net Assets from Institutional
Class Shares Transactions 488,328 80,979 6,560 19,609
--------- --------- --------- -------
Retail Class Shares:
Shares Issued 271,780 99,130 77,444 4,266
Shares Issued as Reinvestment of Distributions 7,025 1,324 47 --
Shares Redeemed (90,065) (8,919) (11,112) (70)
--------- --------- --------- -------
Net Increase in Net Assets from Retail Class
Shares Transactions 188,740 91,535 66,379 4,196
--------- --------- --------- -------
Net Increase in Net Assets from Capital
Share Transactions 677,068 172,514 72,939 23,805
--------- --------- --------- -------
Net Increase in Net Assets 675,152 172,959 74,800 24,296
Net Assets:
Beginning of Year 197,925 24,966 24,296 --
--------- --------- --------- -------
End of Year $ 873,077 $ 197,925 $ 99,096 $24,296
========= ========= ========= =======
Undistributed Net Investment Income $ 29 $ 67 $ 237 $ --
========= ========= ========= =======
Shares Issued and Redeemed:
Institutional Class Shares:
Shares Issued 58,659 9,298 1,733 915
Shares Issued in Connection with In-Kind
Contribution (see Note 5) -- -- -- 1,068
Shares Issued as Reinvestment of Distributions 958 239 21 --
Shares Redeemed (10,756) (1,431) (1,084) (11)
--------- --------- --------- -------
Net Increase in Institutional Class Shares 48,861 8,106 670 1,972
--------- --------- --------- -------
Retail Class Shares:
Shares Issued 27,217 9,921 7,882 432
Shares Issued as Reinvestment of Distributions 705 133 5 --
Shares Redeemed (9,026) (893) (1,125) (7)
--------- --------- --------- -------
Net Increase in Retail Class Shares 18,896 9,161 6,762 425
--------- --------- --------- -------
Net Increase in Share Transactions 67,757 17,267 7,432 2,397
========= ========= ========= =======
* Fund commenced operations on March 30, 2012.
Amounts designated as "--" are either not applicable, $0 or have been rounded to
$0.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
34
Statements of Changes in Net Assets (000) [RIVERPARK FUNDS LOGO]
--------------------------------------------------------------------------------
Riverpark Riverpark
Riverpark/Gargoyle Structural Strategic
Hedged Value Fund Alpha Fund Income Fund
------------------------------------------------------------------
Year Ended Period Ended Period Ended Period Ended
September 30, September 30, September 30, September 30,
2013 2012* 2013** 2013***
------------------------------------------------------------------
Operations:
Net Investment Income (Loss) $ 196 $ 87 $ (37) $ --
Net Realized Gain (Loss) from Investments,
Purchased and Written Options and
Futures Contracts 106 (533) (51) --
Net Change in Unrealized Appreciation on
Investments, Purchased and Written
Options and Futures Contracts 5,194 584 195 --
---------- -------- -------- --------
Net Increase in Net Assets Resulting from
Operations 5,496 138 107 --
---------- -------- -------- --------
Distributions to Shareholders From:
Net Investment Income:
Institutional Class Shares (132) -- -- --
Retail Class Shares (14) -- -- --
Net Realized Gains:
Institutional Class Shares (340) -- -- --
Retail Class Shares (37) -- -- --
---------- -------- -------- --------
Total Distributions to Shareholders (523) -- -- --
---------- -------- -------- --------
Capital Share Transactions:
Institutional Class Shares:
Shares Issued 885 3,519 1,252 2,000
Shares Issued in Connection with In-Kind
Contribution (see Note 5) -- 14,390 7,310 --
Shares Issued as Reinvestment of Distributions 468 -- -- --
Shares Redeemed (2,257) (1,135) (547) --
---------- -------- -------- --------
Net Increase (Decrease) in Net Assets from
Institutional Class Shares
Transactions (904) 16,774 8,015 2,000
---------- -------- -------- --------
Retail Class Shares:
Shares Issued 9,589 396 891 75
Shares Issued as Reinvestment of Distributions 50 -- -- --
Shares Redeemed (2,353) (7) (10) --
---------- -------- -------- --------
Net Increase in Net Assets from Retail Class
Shares Transactions 7,286 389 881 75
---------- -------- -------- --------
Net Increase in Net Assets from Capital
Share Transactions 6,382 17,163 8,896 2,075
---------- -------- -------- --------
Net Increase in Net Assets 11,355 17,301 9,003 2,075
Net Assets:
Beginning of Year 17,301 -- -- --
---------- -------- -------- --------
End of Year $ 28,656 $ 17,301 $ 9,003 $ 2,075
========== ======== ======== ========
Undistributed Net Investment Income $ 137 $ 87 $ -- $ --
========== ======== ======== ========
Shares Issued and Redeemed:
Institutional Class Shares:
Shares Issued 79 372 125 200
Shares Issued in Connection with In-Kind
Contribution (see Note 5) -- 1,439 731 --
Shares Issued as Reinvestment of Distributions 45 -- -- --
Shares Redeemed (205) (116) (54) --
---------- -------- -------- --------
Net Increase (Decrease) in Institutional Class Shares (81) 1,695 802 200
---------- -------- -------- --------
Retail Class Shares:
Shares Issued 843 41 88 8
Shares Issued as Reinvestment of Distributions 5 -- -- --
Shares Redeemed (202) (1) (1) --
---------- -------- -------- --------
Net Increase in Retail Class Shares 646 40 87 8
---------- -------- -------- --------
Net Increase in Share Transactions 565 1,735 889 208
========== ======== ======== ========
* Fund commenced operations on April 30, 2012.
** Fund commenced operations on June 28, 2013.
*** Fund commenced operations on September 30, 2013.
Amounts designated as "--" are either not applicable, $0 or have been rounded
to $0
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
35
Financial Highlights
For a Share Outstanding Throughout Each Period
For the Year or Period Ended September 30,
------------------------------------------------------------------------------------------------------------------------------------
Net Asset Net Realized and Dividends
Value, Investment Unrealized Total from from Net Distributions Distributions
Beginning of Income Gains (Losses) Investment Investment from Net from Return
Period (Loss)(1) on Investments Operations Income Realized Gains of Capital
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Large Growth Fund
Institutional Class Shares
2013 $ 13.27 $ 0.05 $ 3.04 $ 3.09 $ (0.02) $ (0.06) $ --
2012 10.09 0.01 3.17 3.18 -- -- --
2011 10.00 (0.01) 0.16(2) 0.15 -- -- (0.06)
Retail Class Shares
2013 $ 13.21 $ 0.01 $ 3.03 $ 3.04 $ (0.01) $ (0.06) $ --
2012 10.07 (0.03) 3.17 3.14 -- -- --
2011 10.00 (0.04) 0.16(2) 0.12 -- -- (0.05)
RiverPark/Wedgewood Fund
Institutional Class Shares
2013 $ 13.88 $(0.01) $ 2.38 $ 2.37 $ -- $ (0.04) $ --
2012 10.32 (0.05) 3.61 3.56 -- -- --
2011 10.00 (0.06) 0.40(2) 0.34 --(3) -- (0.02)
Retail Class Shares
2013 $ 13.82 $(0.05) $ 2.36 $ 2.31 $ -- $ (0.04) $ --
2012 10.30 (0.08) 3.60 3.52 -- -- --
2011 10.00 (0.09) 0.40(2) 0.31 -- -- (0.01)
RiverPark Short Term High Yield Fund
Institutional Class Shares
2013 $ 10.01 $ 0.39 $ (0.07) $ 0.32 $ (0.35) $ -- $ --
2012 9.88 0.44 0.08 0.52 (0.39) -- --
2011 10.00 0.47 (0.15) 0.32 (0.44) -- --
Retail Class Shares
2013 $ 9.99 $ 0.37 $ (0.06) $ 0.31 $ (0.33) $ -- $ --
2012 9.88 0.42 0.06 0.48 (0.37) -- --
2011 10.00 0.43 (0.13) 0.30 (0.42) -- --
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
36
[RIVERPARK FUNDS LOGO]
------------------------------------------------------------------------------------------------------------------------------------
Ratio of Total Ratio of Net
Net Asset Ratio of Net Expenses to Investment
Total Value, End Net Assets, End of Expenses to Average Income (Loss) to Portfolio
Distributions of Period Total Return++ Period (000) Average Net Assets Net Assets Average Net Assets Turnover Rate
------------------------------------------------------------------------------------------------------------------------------------
$ (0.08) $16.28 23.46%+ $ 6,299 1.00% 1.06% 0.32% 45%
-- 13.27 31.52+ 3,804 1.00 2.78 0.08 24
(0.06) 10.09 1.44+ 2,667 1.00 9.08 (0.10) 73
$ (0.07) $16.18 23.15%+ $ 26,221 1.25% 1.31% 0.06% 45%
-- 13.21 31.18+ 15,383 1.25 1.74 (0.20) 24
(0.05) 10.07 1.19+ 231 1.25 9.76 (0.32) 73
$ (0.04) $16.21 17.15% $ 834,476 0.92%(4) 0.89% (0.06)% 20%
-- 13.88 34.50+ 279,016 1.00 1.03 (0.40) 24
(0.02) 10.32 3.37+ 33,004 1.00 2.83 (0.59) 48
$ (0.04) $16.09 16.79% $ 346,211 1.17%(4) 1.14% (0.32)% 20%
-- 13.82 34.17+ 173,582 1.25 1.27 (0.64) 24
(0.01) 10.30 3.12+ 241 1.25 3.71 (0.78) 48
$ (0.35) $ 9.98 3.39% $ 587,334 0.99%(4) 0.94% 3.88% 390%
(0.39) 10.01 5.32+ 100,224 1.00 1.12 4.42 611
(0.44) 9.88 3.27+ 18,883 1.00 2.12 4.69 454
$ (0.33) $ 9.97 3.14% $ 285,742 1.25%(4) 1.21% 3.75% 390%
(0.37) 9.99 4.88+ 97,701 1.25 1.32 4.23 611
(0.42) 9.88 3.06+ 6,083 1.25 2.18 4.28 454
+ Total return would have been lower had certain fees not been waived and/or
expenses assumed by Adviser during the period.
++ Returns shown do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or upon the redemption of Fund shares.
(1) Per share data was calculated using average shares for the period.
(2) Realized and unrealized gains and losses per share in this caption are
balancing amounts necessary to reconcile the change in net asset value per
share for the period, and may not reconcile with the aggregate gains and
losses in the Statement of Operations due to share transactions for the
period.
(3) Amount represents less than $0.01 per share.
(4) Ratio includes previously waived investment advisory fees recovered.
The accompanying notes are an integral part of the financial statements.
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37
Financial Highlights
For a Share Outstanding Throughout Each Period
For the Year or Period Ended September 30,
------------------------------------------------------------------------------------------------------------------------------------
Net Realized and
Net Asset Value, Investment Unrealized Gains Total from Dividends from Distributions
Beginning of Income (Losses) on Investment Net Investment from Net Total
Period (Loss) (4) Investments Operations Income Realized Gains Distributions
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RiverPark Long/Short Opportunity Fund
Institutional Class Shares
2013 $ 10.14 $ (0.22) $ 0.27 $ 0.05 $ -- $ (0.09) $ (0.09)
2012(1) 10.00 (0.13) 0.27 0.14 -- -- --
Retail Class Shares
2013 $ 10.13 $ (0.23) $ 0.27 $ 0.04 $ -- $ (0.09) $ (0.09)
2012(1) 10.04 (0.13) 0.22 0.09 -- -- --
RiverPark/Gargoyle Hedged Value Fund
Institutional Class Shares
2013 $ 9.97 $ 0.10 $ 2.69 $ 2.79 $(0.08) $ (0.21) $ (0.29)
2012(2) 10.00 0.05 (0.08)(5) (0.03) -- -- --
Retail Class Shares
2013 $ 9.96 $ 0.06 $ 2.70 $ 2.76 $(0.07) $ (0.21) $ (0.28)
2012(2) 9.83 0.05 0.08 0.13 -- -- --
RiverPark Structural Alpha Fund
Institutional Class Shares
2013(3) $ 10.00 $ (0.05) $ 0.17 $ 0.12 $ -- $ -- $ --
Retail Class Shares
2013(3) $ 10.00 $ (0.05) $ 0.17 $ 0.12 $ -- $ -- $ --
The accompanying notes are an integral part of the financial statements.
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Ratio of Net Ratio of Total
Expenses to Average Expenses to Average Ratio of Net
Net Assets, Including Net Assets, Including Investment Income
Net Asset Value, Net Assets, Dividend Expense and Dividend Expense and (Loss) to Average Portfolio
End of Period Total Return+ End of Period (000) Stock Loan Fee Stock Loan Fee Net Assets Turnover Rate
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$ 10.10 0.55% $ 26,686 3.46%(7) 3.60% (2.22)% 56%
10.14 1.40 19,994 3.49(6) 4.12 (2.61) 20
$ 10.08 0.45% $ 72,410 3.61%(7) 3.71% (2.32)% 56%
10.13 0.90 4,302 3.68(6) 4.18 (2.78) 20
$ 12.47 28.54% $ 20,123 1.25% 1.52% 0.92% 66%
9.97 (0.30) 16,899 1.25 1.94 1.28 29
$ 12.44 28.42% $ 8,533 1.50% 1.67% 0.54% 66%
9.96 1.32 402 1.50 1.99 1.35 29
$ 10.12 1.20% $ 8,118 1.75% 2.99% (1.73)% 0%
$ 10.12 1.20% $ 885 2.00% 3.32% (1.98)% 0%
+ Returns shown do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or upon the redemption of Fund shares.
Total return would have been lower had certain fees not been waived and/or
expenses assumed by Adviser during the period.
(1) Institutional Class Shares commenced operations on March 30, 2012 and
Retail Class Shares commenced operations on April 3, 2012. All ratios for
the period have been annualized, except for the Total Return and Portfolio
Turnover Rate.
(2) Institutional Class Shares commenced operations on April 30, 2012 and
Retail Class Shares commenced operations on May 4, 2012. All ratios for the
period have been annualized, except for the Total Return and Portfolio
Turnover Rate.
(3) Commenced operations on June 28, 2013. All ratios for the period have been
annualized, except for the Total Return and Portfolio Turnover Rate.
(4) Per share data was calculated using average shares for the period.
(5) Realized and unrealized gains and losses per share in this caption are
balancing amounts necessary to reconcile the change in net asset value per
share for the period, and may not reconcile with the aggregate gains and
losses in the Statement of Operations due to share transactions for the
period.
(6) Dividend expense and stock loan fee totaled 1.64% of average net assets
for the year ended September 30, 2012. Had these expenses not been included
the ratios would have been 1.85% and 2.00%, respectively.
(7) Dividend expense and stock loan fee totaled 1.61% of average net assets
for the year ended September 30, 2013. Had these expenses not been included
the ratios would have been 1.85% and 2.00%, respectively.
The accompanying notes are an integral part of the financial statements.
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39
Notes to Financial Statements
September 30, 2013
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1. Organization
RiverPark Funds Trust (the "Trust"), was formed on June 22, 2010 as an open-end
registered management investment company under the Investment Act of 1940. As
of September 30, 2013, the Trust was comprised of seven funds: the RiverPark
Large Growth Fund, RiverPark/Wedgewood Fund, RiverPark Short Term High Yield
Fund, RiverPark Long/Short Opportunity Fund, RiverPark/Gargoyle Hedged Value
Fund, RiverPark Structural Alpha Fund and RiverPark Strategic Income Fund (each
a "Fund" and collectively the "Funds"). The investment objective of the
RiverPark Large Growth Fund and RiverPark/Wedgewood Fund is to seek long term
capital appreciation. The investment objective of the RiverPark Short Term High
Yield Fund and RiverPark Strategic Income Fund is to seek high current income
and capital appreciation consistent with the preservation of capital. The
investment objective of the RiverPark Long/Short Opportunity Fund is to seek
long-term capital appreciation while managing downside volatility. The
investment objective of the RiverPark/ Gargoyle Hedged Value Fund and RiverPark
Structural Alpha Fund is to seek long-term capital appreciation while exposing
investors to less risk than broad stock market indices. Each of the Funds is
diversified with the exception of the RiverPark/Wedgewood Fund which is
non-diversified. Each Fund is registered to offer Institutional Class Shares
and Retail Class Shares. Each of the Funds, except the RiverPark Short Term
High Yield Fund, has registered Class C Shares but they are not intended to be
offered at this time. Each class differs as to ongoing fees. The RiverPark
Strategic Income Fund commenced operations on September 30, 2013. As of
September 30, 2013, there has been no investment activity in the RiverPark
Strategic Income Fund. The RiverPark Short Term High Yield Fund was closed to
new investors on June 21, 2013.
2. Summary of Significant Accounting Policies
The following significant accounting policies, which are consistently followed
in the preparation of the financial statements of the Trust, are in conformity
with accounting principles generally accepted in the United States of America
("U.S. GAAP") for investment companies.
Use of Estimates -- The preparation of financial statements in conformity with
U.S. GAAP requires management to make estimates and assumptions that affect the
reported amounts and disclosures in these financial statements. Actual results
could differ from those estimates.
Valuation of Investments -- Securities listed on a national securities exchange
or traded on the NASDAQ system are valued on their last sale price. Portfolio
securities traded on NASDAQ will be valued at the NASDAQ Official Closing Price
on each business day for the New York Stock Exchange ("NYSE"). If there is no
such reported sale on an exchange or NASDAQ, the portfolio security will be
valued at the mean between the most recent quoted bid and asked price. Price
information on listed securities is taken from the exchange where the security
is primarily traded. Other equity securities and debt securities for which
market quotations are readily available are valued at the mean between their
bid and asked price, except that debt securities maturing within 60 days are
valued on an amortized cost basis. Debt securities are valued according to the
broadest and most representative market, which will ordinarily be
over-the-counter. Debt securities may be valued based on prices provided by a
pricing service when such prices are believed to reflect the fair value of such
securities. Securities for which market quotations are not readily available
are valued at fair value as determined in good faith through consideration of
other factors in accordance with procedures adopted by, and under the general
supervision of, the Board of Trustees ("the Board").
To the extent that a Fund invests in non-U.S. dollar denominated securities,
the value of all assets and liabilities not denominated in United States
dollars will be translated into United States dollars on the valuation date.
Trading in securities on European and Far Eastern securities exchanges and
over-the-counter markets is normally completed well before the close of
business on each day the NYSE is open for business (a "Business Day"). In
addition, European or Far Eastern securities trading generally or in a
particular country or countries
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may not take place on all Business Days in New York. Furthermore, trading takes
place in various foreign markets on days which are not Business Days in New
York and on which net asset value is not calculated. Such calculation does not
take place contemporaneously with the determination of the prices of the
majority of the portfolio securities used in such calculation. Events affecting
the values of portfolio securities that occur between the time their prices are
determined and the close of the NYSE will not be reflected in a Fund's
calculation of net assets unless the Trustees deem that the particular event
would materially affect net asset value, in which case an adjustment will be
made.
In accordance with the authoritative guidance on fair value measurement and
disclosure under GAAP, the Funds disclose the fair value of their investments
in a hierarchy that prioritizes the inputs to valuation techniques used to
measure the fair value. The objective of a fair value measurement is to
determine 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 (an exit price). Accordingly, the fair value hierarchy gives
the highest priority to quoted prices (unadjusted) in active markets for
identical assets or liabilities (Level 1) and the lowest priority to
unobservable inputs (Level 3).
The three levels of the fair value hierarchy are described below:
o Level 1 -- Unadjusted quoted prices in active markets for identical,
unrestricted assets or liabilities that the Funds have the ability to
access at the measurement date;
o Level 2 -- Other significant observable inputs (includes quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
referenced indices, quoted prices in inactive markets, adjusted quoted
prices in active markets, etc. ); and
o Level 3 -- Prices, inputs or exotic modeling techniques which are both
significant to the fair value measurement and unobservable (supported by
little or no market activity).
Investments are classified within the level of the lowest significant input
considered in determining fair value. Investments classified within Level 3
whose fair value measurement considers several inputs may include Level 1 or
Level 2 inputs as components of the overall fair value measurement.
For details of the investment classification, refer to the Schedules of
Investments, Schedule of Securities Sold Short, Schedules of Open Options
Purchased and Schedules of Open Options Written.
For the year or period ended September 30, 2013, there were no transfers
between Level 1 and Level 2 assets and liabilities or between Level 2 and Level
3 assets and liabilities. It is the Funds' policy to recognize transfers into
and out of Levels at the end of the reporting period.
For the year or period ended September 30, 2013, there were no significant
changes to the Funds' fair value methodologies.
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41
Notes to Financial Statements
September 30, 2013 (continued)
--------------------------------------------------------------------------------
2. Summary of Significant Accounting Policies (continued)
Securities Sold Short -- As consistent with the RiverPark Long/Short
Opportunity Fund's investment objectives, the Fund intends to sell securities
short so long as, as a result of that sale, the current value of securities
sold short by the Fund would not exceed 50% of the value of its gross assets
(including the amounts borrowed) and 100% of the value of its net assets. A
short sale is the sale by a fund of a security which it does not own in
anticipation of purchasing the same security in the future. To complete such a
transaction, the Fund must borrow the security to make delivery to the buyer.
The Fund is then obligated to replace the security borrowed by purchasing the
security at the market price at the time of the replacement. The price at such
time may be more or less than the price at which the security was sold by the
Fund. Until the security is replaced, the Fund is required to pay the lender
amounts equal to any dividends that accrue during the period of the loan.
Dividends are shown as an expense for financial reporting purposes. To borrow
the security, the Fund also may be required to pay a fee, which is shown as an
expense for financial reporting purposes. The proceeds of the short sale are
retained by the broker, to the extent necessary to meet margin requirements,
until the short position is closed out. A gain, limited to the price at which
the Fund sold the security short, or a loss, unlimited in size, will be
recognized upon the close of a short sale.
Until the Fund closes its short position or replaces the borrowed security, the
Fund will maintain a segregated account with its custodian containing cash or
high-grade securities. The Fund may be required to add to the segregated
account as the market price of a shorted security increases. As a result of
maintaining and adding to its segregated account, the Fund may maintain higher
levels of cash or liquid assets (for example, U.S. Treasury Bills, repurchase
agreements, high quality commercial paper and long equity positions) for
collateral needs thus reducing its overall managed assets available for trading
purposes.
Written/Purchased Options -- Each of the Funds may purchase call and put
options on securities to seek capital growth or for hedging purposes. Each Fund
may also write and sell covered call and put options and purchase and write
options on stock indices (such as the S&P 500 Index) listed on domestic or
foreign securities exchanges or traded in the over-the-counter market for
hedging purposes. Additionally, RiverPark Long/Short Opportunity Fund and
RiverPark/Gargoyle Hedged Value Fund may sell uncovered call options on
securities and stock indices.
The RiverPark Long/Short Opportunity Fund, RiverPark/Gargoyle Hedged Value
Fund, RiverPark Structural Alpha Fund and RiverPark Strategic Income Fund may
invest up to 50% of the value of their assets, represented by premiums paid, to
purchase call and put options on securities and securities indices. The Funds
may write covered call and put options on securities and securities indices, so
long as the aggregate nominal value does not exceed 200% of the value of its
assets. The RiverPark Structural Alpha Fund may purchase or sell options or
option spreads, so long as the aggregate net notional value does not exceed
125%, and the gross notional value does not exceed 250% of the value of its
assets.
An option on a security provides the purchaser, or "holder," with the right,
but not the obligation, to purchase, in the case of a "call" option, or sell,
in the case of a "put" option, the security or securities underlying the
option, for a fixed exercise price up to a stated expiration date. The holder
pays a nonrefundable purchase price for the option, known as the "premium." The
maximum amount of risk the purchaser of the option assumes is equal to the
premium plus related transaction costs, although the entire amount may be lost.
The risk of the seller, or "writer," however, is potentially unlimited, unless
the option is "covered," which is generally accomplished through the writer's
ownership of the underlying security, in the case of a call option, or the
writer's segregation of an amount of cash or securities equal to the exercise
price, in the case of a put option. If the writer's obligation is not covered,
it is subject to the risk of the full change in value of the underlying
security from the time the option is written until exercise.
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Written equity and index options transactions entered into during the year or
period ended September 30, 2013 are summarized as follows:
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Long/
Short Opportunity
Fund
------------------------------------------------------------------------------------------------------------------------------------
Number of Contracts Premiums Received
------------------------------------------------------------------------------------------------------------------------------------
Balance at the beginning of the year -- $ --
Written 182 184,016
Expired (33) (68,985)
Closing buys (129) (91,211)
------------------------------------------------------------------------------------------------------------------------------------
Balance at the end of the year 20 $ 23,820
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
RiverPark/Gargoyle
Hedged Value Fund
------------------------------------------------------------------------------------------------------------------------------------
Number of Contracts Premiums Received
------------------------------------------------------------------------------------------------------------------------------------
Balance at the beginning of the year 237 $ 372,915
Written 2,937 5,182,014
Expired (150) (219,306)
Closing buys (2,833) (4,982,201)
------------------------------------------------------------------------------------------------------------------------------------
Balance at the end of the year 191 $ 353,422
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Structural
Alpha Fund
------------------------------------------------------------------------------------------------------------------------------------
Number of Contracts Premiums Received
------------------------------------------------------------------------------------------------------------------------------------
Balance at the beginning of the period -- $ --
Written 356 848,971
Expired (97) (74,232)
Closing buys (73) (153,640)
------------------------------------------------------------------------------------------------------------------------------------
Balance at the end of the period 186 $ 621,099
------------------------------------------------------------------------------------------------------------------------------------
In addition to the option writing above, the RiverPark Long/Short Opportunity
Fund purchased 130 options contracts, 280 options contracts expired and sold 80
options contracts in the current year for a realized loss of $190,540 with 20
purchased options outstanding. The RiverPark Structural Alpha Fund purchased
108 options contracts, 18 options contracts expired and sold 12 options
contracts in the current period for a realized gain of $59,550 with 78
purchased options outstanding. Purchased and written options held as of
September 30, 2013 are disclosed separately on the Statements of Assets and
Liabilities. The realized and unrealized gain (loss) from options purchased and
written options are disclosed separately on the Statements of Operations.
All written options and purchased options have equity risk exposure.
Additionally, all written options and purchased options held as of September
30, 2013 are exchange-traded and therefore no right of setoff exists.
Swap Agreements -- The Funds may invest in equity-linked securities, including,
but not limited to, participation notes, certificates, and equity swaps.
Equity-linked securities are privately issued securities whose investment
results are designed to correspond generally to the performance of a specified
stock index or "basket" of stocks, or a single stock. To the extent that the
Funds invest in equity-linked securities whose return corresponds to the
performance of a foreign security index or one or more foreign stocks,
investing in equity-linked securities will involve risks similar to the risks
of investing in foreign securities and subject to each Fund's restrictions on
investments in foreign securities.
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43
Notes to Financial Statements
September 30, 2013 (continued)
--------------------------------------------------------------------------------
2. Summary of Significant Accounting Policies (continued)
Equity swaps allow the parties to a swap agreement to exchange the dividend
income or other components of return on an equity investment (for example, a
group of equity securities or an index) for a component of return on another
non-equity or equity investment. An equity swap may be used by a Fund to invest
in a market without owning or taking physical custody of securities in
circumstances in which direct investment may be restricted for legal reasons or
is otherwise deemed impractical or disadvantageous. Equity swaps may also be
used for hedging purposes or to seek to increase total return. A Fund's ability
to enter into certain swap transactions may be limited by tax considerations.
The counterparty to an equity swap contract will typically be a bank,
investment banking firm or broker/dealer.
Equity swap contracts may be structured in different ways. For example, a
counterparty may agree to pay the Fund the amount, if any, by which the
notional amount of the equity swap contract would have increased in value had
it been invested in particular stocks (or an index of stocks), plus the
dividends that would have been received on those stocks. In these cases, the
Fund may agree to pay to the counterparty a floating rate of interest on the
notional amount of the equity swap contract plus the amount, if any, by which
that notional amount would have decreased in value had it been invested in such
stocks. Therefore, the return to the Fund on the equity swap contract should be
the gain or loss on the notional amount plus dividends on the stocks less the
interest paid by the Fund on the notional amount. In other cases, the
counterparty and the Fund may each agree to pay the other the difference
between the relative investment performances that would have been achieved if
the notional amount of the equity swap contract had been invested in different
stocks (or indices of stocks). A Fund will generally enter into equity swaps on
a net basis, which means that the two payment streams are netted out, with the
Fund receiving or paying, as the case may be, only the net amount of the two
payments. Payments may be made at the conclusion of an equity swap contract or
periodically during its term.
Equity swaps are derivatives and their value can be very volatile. Equity swaps
normally do not involve the delivery of securities or other underlying assets.
Accordingly, the risk of loss with respect to equity swaps is normally limited
to the net amount of payments that a Fund is contractually obligated to make.
If the counterparty to an equity swap defaults, a Fund's risk of loss consists
of the net amount of payments that such Fund is contractually entitled to
receive. Because some swap agreements have a leverage component, adverse
changes in the value or level of the underlying asset, reference rate, or index
can result in a loss substantially greater than the cost of the underlying
asset without the use of leverage. In addition, the value of some components of
an equity swap (such as the dividends on a common stock) may also be sensitive
to changes in interest rates. To the extent that the Adviser does not
accurately analyze and predict the potential relative fluctuation of the
components swapped with another party, a Fund may suffer a loss. Because equity
swaps are normally illiquid, a Fund may be unable to terminate its obligations
when desired. When entering into swap contracts, a Fund must "set aside" liquid
assets, or engage in other appropriate measures to "cover" its obligation under
the swap contract.
All swaps held by the RiverPark Long/Short Opportunity Fund during the year
ended September 30, 2013 had equity risk exposure.
Swaps are marked-to-market daily and are valued at the unrealized appeciation
or depreciation on the instrument based upon quotations from market makers and
the resulting changes in market values, if any, are recorded as an unrealized
gain or loss in the Statements of Operations. Net payments of interest are
recorded as realized gains or losses. The total return swaps reset monthly, as
such there was $0 unrealized appreciation (depreciation) as of September 30,
2013.
During the year ended September 30, 2013, the RiverPark Long/Short Opportunity
Fund purchased 344,511 swap contracts and closed 207,059 swap contracts for a
realized gain of $743,218 with 137,452 swap contracts outstanding. The open
swap contracts are collateralized by $250,000 in cash.
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Futures and Options on Futures on Stock Indices -- The RiverPark Structural
Alpha Fund intends to use futures and may use options on futures. The use of
futures involves the risk that the futures contract may temporarily not
correlate with the underlying index on which it is based. Additionally, futures
contracts are leveraged vehicles where limited amounts of capital can expose
the Fund to significant exposure to changes in the underlying index. Options on
futures involve the risks associated with futures as well as the risks
associated with using index options. When options are purchased
over-the-counter, the Fund will bear the risk that the counter-party that wrote
the option will be unable or unwilling to perform its obligations under the
option contract. Such options may also be illiquid, and in such cases, the Fund
may have difficulty closing out its positions. The options contracts are fully
collateralized by securities pledged and $253,000 in cash.
Futures contracts are valued at the unrealized appreciation (depreciation) on
the instrument. Such unrealized is included as a component of the net assets on
the Statement of Assets and Liabilities. Variation margin payments are paid or
received, depending upon whether unrealized gains or losses are incurred. As of
September 30, 2013, the RiverPark Structural Alpha Fund has open futures
contracts and during the year ended, all futures contracts held had equity risk
exposure. For the period ended September 30, 2013, the total amount of all open
futures contracts, as presented in the Schedule of Investments, are
representative of the volume of activity during the year. Additionally, all
futures contracts held are exchange-traded and therefore no right of setoff
exists. In addition to collateral noted on the Schedule of Investments, the
futures contracts are also collateralized by $209,000 in cash.
Master Limited Partnerships -- The Funds may invest in master limited
partnerships ("MLPs"). MLPs are limited partnerships or limited liability
companies, whose partnership units or limited liability interests are listed
and traded on a U.S. securities exchange, and are treated as publicly traded
partnerships for federal income tax purposes. To qualify to be treated as a
partnership for tax purposes, an MLP must receive at least 90% of its income
from qualifying sources as set forth in Section 7704(d) of the Internal Revenue
Code of 1986, as amended (the "Code"). These qualifying sources include
activities such as the exploration, development, mining, production,
processing, refining, transportation, storage and marketing of mineral or
natural resources. MLPs generally have two classes of owners, the general
partner and limited partners. MLPs that are formed as limited liability
companies generally have two analogous classes of owners, the managing member
and the members. For purposes of this section, references to general partners
also apply to managing members and references to limited partners also apply to
members. The general partner is typically owned by a major energy company, an
investment fund, the direct management of the MLP or is an entity owned by one
or more of such parties.The general partner may be structured as a private or
publicly traded corporation or other entity. The general partner typically
controls the operations and management of the MLP through an equity interest of
as much as 2% in the MLP plus, in many cases, ownership of common units and
subordinated units. Limited partners own the remainder of the MLP through
ownership of common units and have a limited role in the MLP's operations and
management.
An investment in MLP units involves certain risks which differ from an
investment in the securities of a corporation. Holders of MLP units have
limited control and voting rights on matters affecting the partnership. In
addition, there are certain tax risks associated with an investment in MLP
units and conflicts of interest exist between common unit holders and the
general partner, including those arising from incentive distribution payments.
As a partnership, an MLP has no tax liability at the entity level. If, as a
result of a change in current law or a change in an MLP's business, an MLP were
treated as a corporation for federal income tax purposes, such MLP would be
obligated to pay federal income tax on its income at the corporate tax rate. If
an MLP were classified as a corporation for federal income tax purposes, the
amount of cash available for distribution by the MLP would be reduced and
distributions received by investors would be taxed under federal income tax
laws applicable to corporate dividends (as dividend income, return of capital,
or capital gain). Therefore, treatment of an MLP as a corporation for federal
income tax purposes would result in a reduction in the after-tax return to
investors, likely causing a reduction in the value of the Funds' shares.
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45
Notes to Financial Statements
September 30, 2013 (continued)
--------------------------------------------------------------------------------
2. Summary of Significant Accounting Policies (continued)
Investment Transactions -- Security transactions are accounted for on the trade
date, the date the order to buy or sell is executed. Costs used in determining
realized gains and losses on the sales of investment securities are those of
the specific securities sold. Discounts or premiums are accreted or amortized
to interest income using the effective interest method. Interest income is
recognized on the accrual basis from settlement date. Dividend income and
expenses and other distributions are recorded on the ex-dividend date, except
certain dividends and distributions from foreign securities which are recorded
as soon as a Fund is informed after the ex-dividend date. Withholding taxes on
foreign dividends have been provided for in accordance with the Funds'
understanding of the applicable country's tax rules and rates. The ability of
issuers of debt securities held by the Funds to meet their obligations may be
affected by economic and political developments in a specific country or
region.
Organization and Offering Costs -- Offering costs for RiverPark Structural
Alpha Fund, including the cost of printing the initial prospectus and
registration fees, are being amortized to expense over a twelve month period.
As of September 30, 2013, the RiverPark Structural Alpha Fund had $36,642
remaining to be amortized.
Expenses -- Expenses of the Trust that can be directly attributed to a
particular Fund are borne by that Fund. Expenses which cannot be directly
attributed to a Fund are apportioned among the Funds of the Trust based on the
number of Funds and/or relative net assets.
Classes -- Class specific expenses are borne by that class of shares. Income,
realized and unrealized gains and losses and non-class specific expenses are
allocated to the respective class on the basis of relative daily net assets.
Foreign Currency Translation -- The books and records of the Funds are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S. dollars
on the date of valuation. The Fund's do not isolate that portion of realized or
unrealized gains and losses resulting from changes in the foreign exchange rate
from fluctuations arising from changes in the market prices of the securities.
These gains and losses are included in net realized and unrealized gains and
losses on investments on the Statements of Operations. Net realized and
unrealized gains and losses on foreign currency transactions represent net
foreign exchange gains or losses from foreign currency exchange contracts,
disposition of foreign currencies, currency gains or losses realized between
trade and settlement dates on securities transactions and the difference
between the amount of the investment income and foreign withholding taxes
recorded on the Fund's books and the U.S. dollar equivalent amounts actually
received or paid.
Forward Foreign Currency Exchange Contracts--Each Fund may, but is not
obligated to, enter into forward foreign currency exchange contracts ("forward
contracts") in order to protect against uncertainty in the level of future
foreign exchange rates in the purchases and sale of securities. A forward
contract generally has no deposit requirement, and no commissions are charged
at any stage for trades. Although foreign exchange dealers do not charge a fee
for commissions, they do realize a profit based on the difference between the
price at which they are buying and selling various currencies. Although forward
contracts are intended to minimize currency risk -- the risk of loss due to a
decline in the value of the hedged currencies -- at the same time, they tend to
limit any potential gain which might result should the value of such currencies
increase. As of September 30, 2013, the RiverPark Short Term High Yield Fund
held a forward contract. It is the Funds' policy to present the gross
unrealized appreciation and gross unrealized depreciation of the forward
contracts separately on the Statements of Assets and Liabilities as the Funds
do not have a master netting agreement with the counterparty to the forward
contracts. In accordance with this policy, unrealized appreciation and
depreciation as of September 30, 2013 are presented in unrealized appreciation
or unrealized depreciation on forward foreign currency contracts on the
Statement of Assets and Liabilities. Realized and unrealized gains (losses) on
forward
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contracts are disclosed separately on the Statements of Operations. For the
year ended September 30, 2013, the total amount of open forward foreign
currency contracts, as presented in the Schedule of Investments, are
representative of the volume of activity for this derivative type during the
year.
Dividends and Distributions to Shareholders -- Dividends from net investment
income are declared and paid to shareholders annually for the RiverPark Large
Growth Fund, RiverPark/Wedgewood Fund, RiverPark Long/Short Opportunity Fund,
RiverPark/Gargoyle Hedged Value Fund and RiverPark Structural Alpha Fund and
declared and paid monthly for the RiverPark Short Term High Yield Fund and
RiverPark Strategic Income Fund. Dividends and distributions are recorded on
the ex-dividend date. Any net realized capital gains will be distributed at
least annually by the Funds.
Income Taxes -- Each Fund intends to qualify or continue to qualify as a
"regulated investment company" under Sub-chapter M of the Internal Revenue Code
of 1986, as amended. If so qualified, each Fund will not be subject to federal
income tax to the extent it distributes substantially all of its net investment
income and net capital gains to its shareholders.
The Funds evaluate tax positions taken or expected to be taken in the course of
preparing the Funds' tax returns to determine whether it is "more-likely-than
not" (i.e., greater than 50-percent) that each tax position will be sustained
upon examination by a taxing authority based on the technical merits of the
position. Tax positions not deemed to meet the more-likely-than-not threshold
are recorded as a tax benefit or expense in the current year. The Funds did not
record any tax provision in the current period. However, management's
conclusions regarding tax positions taken may be subject to review and
adjustment at a later date based on factors including, but not limited to,
examination by tax authorities (i.e., the last 3 tax year ends, as applicable),
on-going analysis of, and changes to, tax laws, regulations and interpretations
thereof.
As of and during the year or period ended September 30, 2013, the Funds did not
have a tax liability for any unrecognized tax benefits. The Funds recognize
interest and penalties, if any, related to unrecognized tax benefits as income
tax expense in the Statements of Operations. During the year or period, the
Funds did not incur any significant interest or penalties.
3. Agreements
Investment Advisory Agreement -- RiverPark Advisors, LLC ("RiverPark") serves
as the Funds' investment adviser (the "Adviser"). For the services it provides
to the Funds, the Adviser receives a fee, which is calculated daily and paid
monthly at the following annual rate: 0.65% for the RiverPark Large Growth
Fund, the RiverPark/ Wedgewood Fund, the RiverPark Short Term High Yield Fund
and the RiverPark Strategic Income Fund, 1.50% for the RiverPark Long/Short
Opportunity Fund, 0.90% for the RiverPark/Gargoyle Hedged Value Fund and 1.40%
for the RiverPark Structural Alpha Fund.
The Adviser has agreed contractually to waive its fees and to absorb expenses
of each Fund through January 31, 2014 to the extent necessary to ensure that
ordinary operating expenses of each class (excluding interest, brokerage
commissions, dividends on short sales and interest expense on securities sold
short, acquired fund fees and expenses and extraordinary expenses) do not
exceed, on an annual basis, 1.00% for the Institutional Class Shares and 1.25%
for the Retail Class Shares of the Fund's average net assets for the RiverPark
Large Growth Fund, the RiverPark/Wedgewood Fund, the RiverPark Short Term High
Yield Fund, and the RiverPark Strategic Income Fund, 1.85% for the
Institutional Class Shares and 2.00% for the Retail Class Shares of the Fund's
average net assets for the RiverPark Long/Short Opportunity Fund, 1.25% for the
Institutional Class Shares and 1.50% for the Retail Class Shares of the Fund's
average net assets for the RiverPark/Gargoyle Hedged Value Fund and 1.75% for
the Institutional Class Shares and 2.00% for the Retail Class Shares of the
Fund's average net assets for the RiverPark Structural Alpha Fund. The Funds
have each agreed to repay
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47
Notes to Financial Statements
September 30, 2013 (continued)
3. Agreements (continued)
the Adviser in the amount of any fees waived and Fund expenses absorbed,
subject to the limitations that: (1) the reimbursement is made only for fees
and expenses incurred not more than three years prior to the date of
reimbursement; and (2) the reimbursement may not be made if it would cause the
expense limitation in effect at the time the fees were waived or Fund expenses
were absorbed, to be exceeded. This arrangement will remain in effect unless
and until the Board approves its modification or termination.
The Adviser can recapture any fees it has waived within a three-year period
subject to the applicable annual rate of 1.00% for the Institutional Class
Shares and 1.25% for the Retail Class Shares for RiverPark Large Growth Fund,
RiverPark/Wedgewood Fund, RiverPark Short Term High Yield Fund and RiverPark
Strategic Income Fund. The Adviser can recapture any fees it has waived within
a three-year period subject to the applicable annual rate of 1.85% for the
Institutional Class Shares and 2.00% for the Retail Class Shares for RiverPark
Long/Short Opportunity Fund. The Adviser can recapture any fees it has waived
within a three-year period subject to the applicable annual rate of 1.25% for
the Institutional Class Shares and 1.50% for the Retail Class Shares for
RiverPark/Gargoyle Hedged Value Fund. The Adviser can recapture any fees it has
waived within a three-year period subject to the applicable annual rate of
1.75% for the Institutional Class Shares and 2.00% for the Retail Class Shares
for RiverPark Structural Alpha Fund.
As of September 30, 2013, the Adviser may in the future seek reimbursement of
previously waived fees for the Funds as follows:
Fund Expiring 2014 Expiring 2015 Expiring 2016 Total
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Large Growth Fund $ 181,119 $ 72,780 $ 15,931 $ 269,830
RiverPark Long/Short Opportunity Fund -- 48,060 59,084 107,144
RiverPark/Gargoyle Hedged Value Fund -- 46,262 58,070 104,332
RiverPark Structural Alpha Fund -- -- 26,858 26,858
For the year ended September 30, 2013, the Adviser recaptured previously waived
fees of $215,208 for the RiverPark/Wedgewood Fund and $252,962 for the
RiverPark Short Term High Yield Fund.
RiverPark provides day-to-day portfolio management services to the RiverPark
Large Growth Fund, RiverPark Long/Short Opportunity Fund and RiverPark
Structural Alpha Fund and oversees the day-to-day portfolio management services
provided by Wedgewood Partners, Inc. ("Wedgewood"), as sub-adviser to the
RiverPark/Wedgewood Fund; Cohanzick Management Inc. ("Cohanzick"), as
sub-adviser to the RiverPark Short Term High Yield Fund and the RiverPark
Strategic Income Fund; and Gargoyle Investment Advisor LLC ("Gargoyle"), as
sub-adviser to the RiverPark/Gargoyle Hedged Value Fund. With regard to the
RiverPark Large Growth Fund, RiverPark Long/Short Opportunity Fund and
RiverPark Structural Alpha Fund, the Adviser has discretion to purchase and
sell securities in accordance with these Funds' objectives, policies, and
restrictions. This investment discretion has been delegated by the Adviser to
Wedgewood, Cohanzick and Gargoyle with regard to each respective Fund to which
such parties serve as sub-adviser. The Adviser pays the sub-advisers a monthly
fee based upon the net assets managed by such sub-adviser from the management
fee paid to the Adviser pursuant to the Investment Advisory Agreement. The
Funds are not responsible for the payment of the sub-advisory fees.
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In consideration for an exchange of equity between RiverPark and Wedgewood in
July 2013, RiverPark and Wedgewood are considered to be affiliates. For its
services as sub-adviser to the RiverPark/Wedgewood Fund, Wedgewood is entitled
to a fee to be paid from RiverPark's adviser fee, and such fee is calculated
daily and paid monthly at an annual rate of 0.325% of the net assets of
RiverPark/Wedgewood Fund's average net assets.
Administrator, Custodian and Transfer Agent -- SEI Investments Global Funds
Services (the "Administrator") serves as the Funds' administrator pursuant to
an Administration Agreement under which the Administrator provides
administrative and accounting services for an annual fee equal to 0.12% of the
first $500 million, 0.10% of the next $500 million, and 0.08% of any amount
above $1 billion of the Funds' average daily net assets, subject to a minimum
annual fee.
Brown Brothers Harriman & Co. (the "Custodian") serves as the Funds' custodian
pursuant to a Custodian Agreement. DST Systems, Inc. (the Transfer Agent")
serves as the Funds' transfer agent pursuant to an Agency Agreement.
Distribution Agreement -- SEI Investments Distribution Co., a wholly-owned
subsidiary of SEI Investments Company and an affiliate of the Administrator
(the "Distributor") serves as the Funds' distributor pursuant to a Distribution
Agreement.
The Trust has adopted a shareholder services plan under which a shareholder
servicing fee may be paid at an annual rate of up to 0.25% of average daily net
assets attributable to Retail Class Shares and Institutional Class Shares of
the Funds to banks and their affiliates and other institutions, including
broker-dealers, as compensation for providing non-distribution related
shareholder services. Aggregate compensation for the Institutional Class Shares
will not exceed on an annual basis 0.15% of the average daily net assets of
such class. As of September 30, 2013, there were no shareholder servicing fees
charged to Institutional Class Shares.
The Trust has adopted an administrative services plan under which each Fund may
pay a non-distribution related administrative services fee at an annual rate of
up to 0.20% (currently set at 0.15%) and 0.15% of the average daily net assets
of the Retail Class Shares and Institutional Class Shares, respectively, to
financial institutions, retirement plans, broker-dealers, depository
institutions, institutional shareholders of record, registered investment
advisers and other financial intermediaries and various brokerage firms or
other industry recognized service providers of fund supermarkets or similar
programs who provide administrative, recordkeeping and support servicing to
their customers.
Other -- Certain officers and a Trustee of the Trust are also officers of the
Adviser and the Administrator. Such officers are paid no fees by the Trust for
serving as officers of the Trust.
The services provided by the Chief Compliance Officer ("CCO") and his staff are
paid for by the Funds as incurred. The services include regulatory oversight of
the Trust's Adviser, sub-advisers and service providers as required by SEC
regulations.
PaymentsofexpensespursuanttotheAdministrativeandShareholderServicesPlanswereimp
roperlyallocated between the RiverPark Short Term High Yield Fund and
RiverPark/Wedgewood Fund from September 2012 until September 2013. Such
misallocation resulted in the Wedgewood Fund paying $212,000 of expenses that
should have been paid by the Short Term High Yield Fund. The resultant
over/under payment is disclosed as a receivable/payable from/to affiliate on
the Statement of Assets and Liabilities. The receivable/payable has been posted
to the Funds' accounts as of December 2, 2013.
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49
Notes to Financial Statements
September 30, 2013 (continued)
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4. Investment Transactions
The cost of security purchases and proceeds from security sales, other than
short-term investments, short sales, purchases to cover, written and purchased
options, and short-term securities for the year or period ended September 30,
2013, were as follows:
Proceeds
Fund Purchases (000) from Sales (000)
--------------------------------------------------------------------------------
RiverPark Large Growth Fund $ 20,101 $ 11,004
RiverPark/Wedgewood Fund 682,766 140,333
RiverPark Short Term High Yield Fund 1,679,149 957,758
RiverPark Long/Short Opportunity Fund 93,029 28,306
RiverPark/Gargoyle Hedged Value Fund 19,264 15,246
RiverPark Structural Alpha Fund -- --
RiverPark Strategic Income Fund -- --
There were no purchases or sales of U.S. Government securities for the year or
period ended September 30, 2013.
5. In-Kind Contributions
As part of the Fund conversion on March 30, 2012, the RiverPark Long/Short
Opportunity Fund received an in-kind contribution from the RiverPark
Opportunity Fund, LLC, which consisted of $10,680,117 of cash, securities and
securities sold short which were recorded at their then current value. As a
result of the in-kind contribution, the RiverPark Long/Short Opportunity Fund
issued 1,068,012 Institutional Class Shares at a $10/share net asset value.
As part of the Fund conversion on April 30, 2012, the RiverPark/Gargoyle Hedged
Value Fund received an in-kind contribution from the Gargoyle Hedge Value Fund
L.P., which consisted of $14,389,843 of securities and written options which
were recorded at their then current value. As a result of the in-kind
contribution, the RiverPark/Gargoyle Hedged Value Fund issued 1,438,984
Institutional Class Shares at a $10/share net asset value.
As part of the Fund conversion on June 28, 2013, the RiverPark Structural Alpha
Fund received an in-kind contribution from the Wavecrest Partners Fund I L.P.,
which consisted of $7,310,149 of cash, purchased and written options and index
futures, which were recorded at their then current value. As a result of the
in-kind contribution, the RiverPark Structural Alpha Fund issued 731,015
Institutional Class Shares at a $10 per share net asset value.
The in-kind contributions were treated as tax-free transactions for federal
income tax purposes, except for the RiverPark Structural Alpha Fund
contribution which was taxable.
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6. Federal Tax Information
The amount and character of income and capital gain distributions to be paid,
if any, are determined in accordance with Federal income tax regulations, which
may differ from U.S. GAAP. As a result, net investment income (loss) and net
realized gain (loss) on investment transactions for a reporting period may
differ significantly from distributions during the year. The book/tax
differences may be temporary or permanent. To the extent these differences are
permanent in nature, they are charged or credited to undistributed net
investment income (loss), accumulated net realized gain (loss) or paid-in
capital as appropriate, in the period that the difference arises.
Accordingly the following permanent differences are primarily attributable to
basis adjustment on carryover securities, distribution reclassification, net
operating losses, Master Limited Partnership dividend income reclasses, losses
on paydowns, basis adjustments for investment in Master Limited Partnership,
investment in swaps, currency transactions, investment in short securities and
REIT adjustments which have been classified to/from the following components of
net assets (000):
Undistributed
Net Investment Accumulated
Fund Income (Loss) Realized Gain (Loss) Paid-In Capital
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Large Growth Fund $ 96 $ (95) $ (1)
RiverPark/Wedgewood Fund 1,056 (1,056) --
RiverPark Short Term High Yield Fund (2,458) 2,458 --
RiverPark Long/Short Opportunity Fund 1,401 (485) (916)
RiverPark/Gargoyle Hedged Value Fund -- 876 (876)
RiverPark Structural Alpha Fund 37 (37) --
These reclassifications have no impact on net asset value or net asset value
per share.
The tax character of dividends and distributions declared during the last two
years or periods ended September 30, 2013, was as follows (000):
Ordinary Long-Term Return of
Fund Income Capital Gain Capital Total
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Large Growth Fund
2013 $ 69 $ 44 $ -- $ 113
RiverPark/Wedgewood Fund
2013 1,598 -- -- 1,598
RiverPark Short Term High Yield Fund
2013 18,265 -- -- 18,265
2012 3,847 -- -- 3,847
RiverPark Long/Short Opportunity Fund
2013 161 86 -- 247
RiverPark/Gargoyle Hedged Value Fund
2013 296 227 -- 523
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Notes to Financial Statements
September 30, 2013 (continued)
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6. Federal Tax Information (continued)
As of September 30, 2013, the components of distributable earnings (accumulated
losses) on a tax basis were as follows (000):
Total
Distributable
Undistributed Undistributed Unrealized Other Earnings
Ordinary Long-Term Capital Loss Post-October Appreciation Temporary (Accumulated
Income Capital Gain Carryforwards Losses (Depreciation) Differences Losses)
----------------------------------------------------------------------------------------------
RiverPark Large Growth Fund $ 86 $ 96 $ -- $ -- $ 6,400 $ 80 $ 6,662
RiverPark/Wedgewood Fund 3,753 1,486 -- -- 173,533 -- 178,772
RiverPark Short Term High Yield Fund 29 -- (112) (91) (1,586) -- (1,760)
RiverPark Long/Short Opportunity Fund -- -- -- (4,272) 9,788 (2,148) 3,368
RiverPark/Gargoyle Hedged Value Fund 230 199 -- -- 6,849 (850) 6,428
RiverPark Structural Alpha Fund 20 87 -- -- -- -- 107
Post-October losses represent losses realized on investment transactions from
November 1, 2012, through September 30, 2013, that, in accordance with Federal
income tax regulations, the Funds may elect to defer and treat as having arisen
in the following fiscal year.
For federal income tax purposes, capital losses incurred in taxable years
beginning before December 22, 2010 may be carried forward for a maximum period
of eight years and applied against future capital gains. At September 30, 2013,
the breakdown of capital loss carryforwards was as follows (000):
Fund Expires 2019
--------------------------------------------------------------------------------
RiverPark Short Term High Yield Fund $1
Under the recently enacted Regulated Investment Company Modernization Act of
2010, the Funds are permitted to carry forward capital losses incurred in
taxable years beginning after December 22, 2010 for an unlimited period.
However, any losses incurred during those future taxable years are required to
be utilized prior to the losses incurred in pre-enactment taxable years. As a
result of this ordering rule, preenactment capital loss carryforwards may be
more likely to expire unused. Additionally, post-enactment capital losses that
are carried forward will retain their character as either short-term or
long-term capital losses rather than being considered all short-term as under
previous law. Capital loss carryforwards under the new provisions are as
follows (000):
Fund Short Term Loss Long Term Loss Total
---------------------------------------------------------------------------------------------------
RiverPark Short Term High Yield Fund $111 $ -- $111
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For federal income tax purposes, the cost of securities owned at September 30,
2013, and the net realized gains or losses on securities sold for the period,
were different from amounts reported for financial reporting purposes,
primarily due to wash sales which cannot be used for federal income tax
purposes in the current year and have been deferred for use in future years.
The federal tax cost and aggregate gross unrealized appreciation and
depreciation on investments held by the Funds, excluding securities sold short
and purchased and written options, at September 30, 2013, were as follows
(000):
Aggregate Aggregate
Gross Gross Net Unrealized
Federal Tax Unrealized Unrealized Appreciation
Fund Cost Appreciation Depreciation (Depriciation)
------------------------------------------------------------------------------------------------------------------------------------
RiverPark Large Growth Fund $ 26,331 $ 6,545 $ (145) $ 6,400
RiverPark/Wedgewood Fund 1,005,115 185,668 (12,135) 173,533
RiverPark Short Term High Yield Fund 873,321 1,272 (2,912) (1,640)
RiverPark Long/Short Opportunity Fund 97,944 15,272 (1,804) 13,468
RiverPark/Gargoyle Hedged Value Fund 22,570 7,032 (183) 6,849
RiverPark Structural Alpha Fund 8,022 -- -- --
RiverPark Strategic Income Fund 2,000 -- -- --
7. Risks
The RiverPark Short Term High Yield Fund invests a significant portion of its
assets in fixed income securities. Fixed income securities are subject to
credit risk and market risk, including interest rate risk. Credit risk is the
risk of the issuer's inability to meet its principal and interest payment
obligations. Market risk is the risk of price volatility due to such factors as
interest rate sensitivity, market perception of the creditworthiness of the
issuer and general market liquidity. The prices of securities in general and
fixed-income securities in particular tend to be sensitive to interest rate
fluctuations. Unexpected fluctuations in interest rates can result in
significant changes in the prices of fixed-income securities.
The RiverPark Short Term High Yield Fund invests in fixed-income instruments
which are or are deemed to be the equivalent in terms of quality to securities
rated below investment grade by Moody's Investors Service, Inc. and Standard &
Poor's Corporation and accordingly involve great risk. Such securities are
regarded as predominantly speculative with respect to the issuer's capacity to
pay interest and repay principal in accordance with the terms of the
obligations and involve major risk to adverse conditions. These securities
offer higher returns than bonds with higher ratings as compensation for holding
an obligation of an issuer perceived to be less creditworthy. Changes in
economic conditions or developments regarding issuers of non-investment grade
debt securities are more likely to cause price volatility and weaken the
capacity of such issuers to make principal and interest payments than is the
case for higher grade debt securities. In addition, the market for lower grade
debt securities may be thinner and less active than for higher grade debt
securities.
The RiverPark Short-Term High Yield Fund invests principally in high-yield
securities. Such securities are generally not exchange-traded and, as a result,
these instruments trade in a smaller secondary market than exchange-traded
bonds. In addition, the Fund invests in bonds of issuers that do not have
publicly traded equity securities, making it more difficult to hedge the risks
associated with such investments. High-yield securities that are below
investment grade or unrated face ongoing uncertainties and exposure to adverse
business, financial or economic conditions which could lead to the issuer's
inability to meet timely interest and principal payments.
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53
Notes to Financial Statements
September 30, 2013 (continued)
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7. Risks (continued)
The RiverPark Short Term High Yield Fund may invest in securities of companies
that are experiencing significant financial or business difficulties, including
companies involved in bankruptcy or other reorganization and liquidation
proceedings. Although such investments may result in significant returns to the
Fund, they involve a substantial degree of risk.
The RiverPark Long/Short Opportunity Fund is exposed to the risks of using
leverage and short sales. The RiverPark Long/Short Opportunity Fund may use
leverage. Leverage is the practice of borrowing money to purchase securities.
These investment practices involve special risks. Leverage can increase the
investment returns of the RiverPark Long/Short Opportunity Fund if the
securities purchased increase in value in an amount exceeding the cost of the
borrowing. However, if the securities decrease in value, the RiverPark
Long/Short Opportunity Fund will suffer a greater loss than would have resulted
without the use of leverage. A short sale is the sale by the RiverPark
Long/Short Opportunity Fund of a security which it does not own in anticipation
of purchasing the same security in the future at a lower price to close the
short position. A short sale will be successful if the price of the shorted
security decreases. However, if the underlying security goes up in price during
the period in which the short position is outstanding, the RiverPark Long/Short
Opportunity Fund will realize a loss. The risk on a short sale is unlimited
because the RiverPark Long/Short Opportunity Fund must buy the shorted security
at the higher price to complete the transaction. Therefore, short sales may be
subject to greater risks than investments in long positions. With a long
position, the maximum sustainable loss is limited to the amount paid for the
security plus the transaction costs, whereas there is no maximum attainable
price of the shorted security.
The RiverPark Long/Short Opportunity Fund, RiverPark/Gargyole Hedged Value Fund
and RiverPark Structural Alpha Fund invest in options which expose investors to
the risks inherent in trading options. These risks include, but are not limited
to, volatile movements in the price of the underlying instrument and
misjudgments as to the future prices of the options and/or the underlying
instrument. Increased option volatility can increase both the profit potential
and the risk associated with a fund's trading. While volatility can be
monitored and reacted to, there is no cost-effective means of hedging against
market volatility.
Selling options creates additional risks. The seller of a "naked" call option
(or the seller of a put option who has a short position in the underlying
instrument) is subject to the risk of a rise in the price in the underlying
instrument above the strike price, which risk is reduced only by the premium
received for selling the option. In exchange for the proceeds received from
selling the call option (in lieu of an outright short position), the option
seller gives up (or will not participate in) all of the potential gain
resulting from a decrease in the price of the underlying instrument below the
strike price prior to expiration of the option.
The seller of a "naked" put option (or the seller of a call option who has a
long position in the underlying instrument) is subject to the risk of a decline
in price of the underlying instrument below the strike price, which risk is
reduced only by the proceeds received from selling the option. In exchange for
the premium received for selling the put option (in lieu of an outright long
position), the option seller gives up (or will not participate in) all of the
potential gain resulting from an increase in the price of the underlying
instrument above the strike price prior to the expiration of the option. Due to
the inherent leveraged nature of options, a relatively small adverse move in
the price of the underlying instrument may result in immediate and substantial
losses to a Fund.
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The RiverPark Long/Short Opportunity Fund invests in swaps. The use of swaps is
a highly specialized activity that involves investment techniques, risk
analyses and tax planning different from those associated with ordinary
portfolio securities transactions. These transactions can result in sizeable
realized and unrealized capital gains and losses relative to the gains and
losses from the Fund's direct investments in the reference assets and short
sales. Transactions in swaps can involve greater risks than if the RiverPark
Long/Short Opportunity Fund had invested directly in the reference asset
because, in addition to general market risks, swaps are also subject to
illiquidity risk, counterparty risk, credit risk and valuation risk. Because
they are two-party contracts and because they may have terms of greater than
seven days, swap transactions may be considered to be illiquid. Moreover, the
Fund bears the risk of loss of the amount expected to be received under a swap
in the event of the default or bankruptcy of a swap counterparty. Some swaps
may be complex and valued subjectively. Swaps may also be subject to pricing or
"basis" risk, which exists when a particular swap becomes extraordinarily
expensive relative to historical prices or the price of corresponding cash
market instruments. Under certain market conditions it may not be economically
feasible to initiate a transaction or liquidate a position in time to avoid a
loss or take advantage of an opportunity. The prices of swaps can be very
volatile, and a variance in the degree of volatility or in the direction of the
price of the reference asset from the expectations may produce significant
losses in the Fund's investments in swaps. In addition, a perfect correlation
between a swap and an investment position may be impossible to achieve. As a
result, the Fund's use of swaps may not be effective in fulfilling the Fund's
investment strategies and may contribute to losses that would not have been
incurred otherwise. As a registered investment company, the Fund must "set
aside" liquid assets (often referred to as "asset segregation"), or engage in
other approved measures to "cover" open positions with respect to certain kinds
of derivatives instruments. The Fund reserves the right to modify its asset
segregation policies in the future to comply with any changes in the SEC's
positions regarding asset segregation.
The RiverPark Long/Short Opportunity Fund is exposed to counterparty credit
risk through its investment in swap contracts. The RiverPark Long/Short
Opportunity Fund bears the risk of loss of the amount expected to be received
under a swap agreement in the event of default or bankruptcy of the
counterparty, or if the counterparty fails to honor its obligations. The
RiverPark Long/Short Opportunity Fund has entered into swap agreements with a
single counterparty, focusing its exposure to the counterparty credit risk of
that single counterparty. Further, the swap counterparty's obligation to the
RiverPark Long/Short Opportunity Fund likely will not be collateralized. The
RiverPark Long/Short Opportunity Fund intends to settle swap agreements at
least monthly.
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55
Notes to Financial Statements
September 30, 2013 (continued)
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8. Other
On September 30, 2013, the Funds had the following concentrations of
shareholders holding 10% or more of the outstanding shares of the Funds. These
represent omnibus shareholder accounts comprised of one or many individual
shareholders.
Fund
--------------------------------------------------------------------------------
RiverPark Large Growth Fund
Institutional Class Shares 81%
Retail Class Shares 95%
RiverPark/Wedgewood Fund
Institutional Class Shares 62%
Retail Class Shares 87%
RiverPark Short Term High Yield Fund
Institutional Class Shares 68%
Retail Class Shares 86%
RiverPark Long/Short Opportunity Fund
Institutional Class Shares 64%
Retail Class Shares 94%
RiverPark/Gargoyle Hedged Value Fund
Institutional Class Shares 13%
Retail Class Shares 83%
RiverPark Structural Alpha Fund
Institutional Class Shares 26%
Retail Class Shares 97%
RiverPark Strategic Income Fund
Institutional Class Shares 100%
Retail Class Shares 100%
In the normal course of business, the Trust enters into contracts that contain
a variety of representations which provide general indemnifications. The
Trust's maximum exposure under these arrangements cannot be known; however, the
Trust expects any risk of loss to be remote.
9. Recent Accounting Pronouncements
In December 2011, the Financial Accounting Standards Board ("FASB") issued a
further update to the guidance "Balance Sheet -- Disclosures about Offsetting
Assets and Liabilities". The amendments to this standard require an entity to
disclose information about offsetting and related arrangements to enable users
of its financial statements to understand the effect of those arrangements on
its financial position. The amended guidance is effective for interim and annual
reporting periods beginning after January 1, 2013 and for the period ended
September 30, 2013 was applicable only to the RiverPark Structural Alpha Fund.
Management is currently evaluating the impact, if any, on the remaining Funds'
financial statements.
Additional disclosure was required for the RiverPark Structural Alpha Fund and
is included in the Notes to Financial Statements.
10. Subsequent Events
The Funds have evaluated the need for additional disclosures and/or adjustments
resulting from subsequent events through the date the financial statements were
issued. Based on this evaluation, no adjustments were required to the financial
statements.
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Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees
RiverPark Funds Trust
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments, schedule of securities sold short,
schedules of open options purchased, and schedules of open options written of
RiverPark Funds Trust (the "Trust"), comprising RiverPark Large Growth Fund,
RiverPark/ Wedgewood Fund, RiverPark Short Term High Yield Fund, RiverPark
Long/Short Opportunity Fund, RiverPark/ Gargoyle Hedged Value Fund, RiverPark
Structural Alpha Fund, and RiverPark Strategic Income Fund (the "Funds") as of
September 30, 2013, and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the three years in
the period then ended for RiverPark Large Growth Fund, RiverPark/ Wedgewood
Fund, and RiverPark Short Term High Yield Fund, and the related statements of
operations for the year then ended, the statements of changes in net assets,
and the financial highlights for each of the two periods in the period then
ended for RiverPark Long/Short Opportunity Fund and RiverPark Gargoyle Hedged
Value Fund, and the related statements of operations, and changes in net
assets, and financial highlights for the period June 28, 2013 (commencement of
operations), to September 30, 2013, for RiverPark Structural Alpha Fund, and
the related statement of changes in net assets as of September 30, 2013
(commencement of operations), for RiverPark Strategic Income Fund. These
financial statements and financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures
included confirmation of securities owned as of September 30, 2013, by
correspondence with the custodian and brokers or by other appropriate auditing
procedures where replies from brokers or counterparties were not received. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Funds constituting RiverPark Funds Trust as of September 30, 2013, the
results of their operations, the changes in their net assets and their
financial highlights for the periods indicated above, in conformity with
accounting principles generally accepted in the United States of America.
Our audit was conducted for the purpose of forming an opinion on each Fund's
financial statements and financial highlights as a whole. The information
presented on pages 1 through 14 and pages 58 through 68, which is the
responsibility of the Funds' management, is presented for purposes of
additional analysis and is not a required part of the basic financial
statements. Such information has not been subjected to the auditing procedures
applied in the audit of the financial statements, and, accordingly, we do not
express an opinion or provide any assurance on it.
COHEN FUND AUDIT SERVICES, LTD.
Cleveland, Ohio
December 3, 2013
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TRUSTEES AND OFFICERS OF THE TRUST (Unaudited)
Set forth below are the names, addresses, ages, position with the Trust, term
of office and length of time served, the principal occupations for the last
five years, number of portfolios in the Fund Complex overseen by Trustee, and
other directorships outside the Fund Complex of each of the persons currently
serving as Trustees and Officers of the Trust. The Trust's Statement of
Additional Information ("SAI") includes additional information about the
trustees and officers. The SAI may be obtained without charge by calling (888)
564-4517. The following chart lists Trustees and Officers as of September 30,
2013.
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NAME, ADDRESS, POSITION(S) HELD TERM OF OFFICE PRINCIPAL NUMBER OF OTHER
AND AGE WITH THE TRUST AND LENGTH OF OCCUPATION(S) PORTFOLIOS IN FUND DIRECTORSHIPS
TIME SERVED DURING PAST FIVE COMPLEX** HELD BY TRUSTEE
YEARS
---------------------------------------------------------------------------------------------------------------------------------
Richard Browne, Independent Indefinite; since President, Rector 7 None
156 West 56th Trustee September 20, Management
Street, 17th Floor, 2010 Corporation
New York, NY (since 1986).
10019
(53)
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Michael Cohen, Independent Indefinite; since Managing Partner, 7 None
156 West 56th Trustee September 20, Coda Capital
Street, 17th Floor, 2010 Partners
New York, NY (since 1999).
10019
(54)
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Ira Balsam, Independent Indefinite; since Chief Financial 7 None
156 West 56th Trustee March 1, Officer, Avenue
Street, 17th Floor, 2010 Capital Management
New York, NY II, L.P. (2/2002-
10019 12/31/2011)
(48)
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Morty Schaja*, Interested Trustee, Indefinite; since Chief Executive 7 None
156 West 56th Street, President and June 22, 2010 Officer and
17th Floor, New York, Chairman of the Managing
NY 10019 Board Partner, RiverPark
(58) Advisors, LLC and
RiverPark Capital
Management LLC
(since 2009); Chief
Executive Officer
and Managing
Partner, RiverPark
Capital LLC (since
2006); President
and Chief Operating
Officer, Baron
Capital Inc. and
Baron Funds (1991
to 2006).
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Mitch Rubin*, Interested Trustee Indefinite; since Chief Investment 7 None
156 West 56th Street, September 20, Officer and
17th Floor, New York, 2010 Managing
NY 10019 Partner, RiverPark
(47) Advisors, LLC and
RiverPark Capital
Management LLC
(since 2009); Chief
Investment Officer
and Managing
Partner, RiverPark
Capital LLC (2006
to 2008 and since
2009); Partner,
Arience Capital
(2008); Baron Capiatl Inc.
Portfolio
Manager(1995 to
2006).
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TRUSTEES AND OFFICERS OF THE TRUST (UNAUDITED) (CONTINUED)
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NAME, ADDRESS, POSITION(S) HELD TERM OF OFFICE PRINCIPAL NUMBER OF OTHER
AND AGE WITH THE TRUST AND LENGTH OF OCCUPATION(S) PORTFOLIOS IN FUND DIRECTORSHIPS
TIME SERVED DURING PAST FIVE COMPLEX** HELD BY TRUSTEE
YEARS
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Paul Genova, Secretary Since September Chief Financial N/A N/A
156 West 56th Street, 20, 2010 Officer, RiverPark
17th Floor, New York, Advisors, LLC and
NY 10019 RiverPark Capital
(36) Management
LLC (since 2009);
Chief Financial
Officer, RiverPark
Capital LLC (since
2008); Controller,
K Squared Capital
Advisors, LP
(2007 to 2008);
Exis Capital
Management, Inc.
(2003 to 2007).
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Matt Kelly, Vice President Since September Chief Marketing N/A N/A
156 West 56th 20, 2010 Officer and
Street, 17th Floor, Partner, RiverPark
New York, NY Advisors, LLC and
10019 RiverPark Capital
(44) Management LLC
(since 2010); Vice
President, Baron
Funds (1997 to
2010).
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Michael Lawson, Treasurer and Chief Since September Director, SEIGFS N/A N/A
One Freedom Financial Officer 20, 2010 Fund Accounting
Valley Drive, Oaks, Department (since
PA 19456 2005).
(52)
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Lisa Whittaker, Assistant Vice Since November 12, Corporate Counsel, N/A N/A
One Freedom Valley President and 2012 Investments SEI Global
Drive Oaks, PA 19456 Assistant Secretary Funds Services (since
(34) 2012); The Glenmede
Trust Company (2011-
2012); Drinker
Biddle & Reath LLP
(2006-2011).
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Carolyn Mead, Assistant Vice Since September Corporate Counsel, N/A N/A
One Freedom President and 20, 2010 SEIGFS (since
Valley Drive, Oaks, Assistant Secretary 2007); Associate
PA 19456 Counsel, Stradley
(56) Ronan, Stevens &
Young LLP (2004 to
2007).
---------------------------------------------------------------------------------------------------------------------------------
Brian Ferko, Chief Compliance Since September Managing Director, N/A N/A
500 East Officer 20, 2010 Cipperman
Swedesford Road, Compliance
Suite 104 Wayne, Services;
PA 19087 formerly with
(42) Aberdeen Asset
Management,
BHR Fund
Advisers, Ardmore
Investment
Partners and
Turner Investment
Partners.
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* Denotes Trustees who are "interested persons" of the Trust or Fund under
the 1940 Act
** The Fund complex includes each series of the Trust
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59
Disclosure of Fund Expenses (Unaudited)
--------------------------------------------------------------------------------
All mutual funds have operating expenses. As a shareholder of a mutual fund,
your investment is affected by these ongoing costs, which include (among
others) costs for portfolio management, administrative services, and
shareholder reports like this one. It is important for you to understand the
impact of these costs on your investment returns.
Operating expenses such as these are deducted from a mutual fund's gross income
and directly reduce its final investment return. These expenses are expressed
as a percentage of a mutual fund's average net assets; this percentage is known
as a mutual fund's expense ratio.
The following examples use the expense ratio and are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The table on the following page illustrates your Fund's costs in two ways.
o Actual Fund Return. This section helps you to estimate the actual expenses
after fee waivers that your Fund incurred over the period. The "Expenses Paid
During Period" column shows the actual dollar expense incurred by a $1,000
investment in the Fund, and the "Ending Account Value" number is derived from
deducting that expense from the Fund's gross investment return.
You can use this information, together with the actual amount you invested in
the Fund, to estimate the expenses you paid over that period. Simply divide
your actual account value by $1,000 to arrive at a ratio (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply that ratio by the
number shown for your Fund under "Expenses Paid During Period."
o Hypothetical 5% Return. This section helps you compare your Fund's costs with
those of other mutual funds. It assumes that the Fund had an annual 5% return
before expenses during the year, but that the expense ratio (Column 3) for the
period is unchanged. This example is useful in making comparisons because the
Securities and Exchange Commission requires all mutual funds to make this 5%
calculation. You can assess your Fund's comparative cost by comparing the
hypothetical result for your Fund in the "Expenses Paid During Period" column
with those that appear in the same charts in the shareholder reports for other
mutual funds.
Note: Because the return is set at 5% for comparison purposes -- NOT your
Fund's actual return--the account values shown may not apply to your specific
investment.
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60
Disclosure of Fund Expenses
(Unaudited) (continued) [RIVERPARK FUNDS LOGO]
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Beginning Ending Net Expenses
Account Account Annualized Paid
Value Value Expense During
4/1/13 9/30/13 Ratios Period*
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RiverPark Large Growth Fund -- Institutional Class Shares
Actual Fund Return $ 1,000.00 $ 1,109.00 1.00% $ 5.29
Hypothetical 5% Return 1,000.00 1,020.05 1.00 5.06
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RiverPark Large Growth Fund -- Retail Class Shares
Actual Fund Return 1,000.00 1,107.50 1.25 6.60
Hypothetical 5% Return 1,000.00 1,018.80 1.25 6.33
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RiverPark/Wedgewood Fund -- Institutional Class Shares
Actual Fund Return 1,000.00 1,108.00 0.87 4.60
Hypothetical 5% Return 1,000.00 1,020.71 0.87 4.41
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RiverPark/Wedgewood Fund -- Retail Class Shares
Actual Fund Return 1,000.00 1,105.80 1.12 5.91
Hypothetical 5% Return 1,000.00 1,019.45 1.12 5.67
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RiverPark Short Term High Yield Fund -- Institutional Class Shares
Actual Fund Return 1,000.00 1,015.00 0.98 4.95
Hypothetical 5% Return 1,000.00 1,020.16 0.98 4.96
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RiverPark Short Term High Yield Fund -- Retail Class Shares
Actual Fund Return 1,000.00 1,014.80 1.25 6.31
Hypothetical 5% Return 1,000.00 1,018.80 1.25 6.33
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RiverPark Long/Short Opportunity Fund -- Institutional Class Shares
Actual Fund Return 1,000.00 1,023.30 2.77+ 14.05
Hypothetical 5% Return 1,000.00 1,011.18 2.77 13.97
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RiverPark Long/Short Opportunity Fund -- Retail Class Shares
Actual Fund Return 1,000.00 1,023.40 2.92+ 14.81
Hypothetical 5% Return 1,000.00 1,010.43 2.92 14.72
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RiverPark/Gargoyle Hedged Value Fund -- Institutional Class Shares
Actual Fund Return 1,000.00 1,090.00 1.25 6.55
Hypothetical 5% Return 1,000.00 1,018.80 1.25 6.33
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RiverPark/Gargoyle Hedged Value Fund -- Retail Class Shares
Actual Fund Return 1,000.00 1,089.30 1.50 7.86
Hypothetical 5% Return 1,000.00 1,017.55 1.50 7.59
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RiverPark Structural Alpha Fund -- Institutional Class Shares***
Actual Fund Return 1,000.00 1,012.00 1.75 4.58**
Hypothetical 5% Return 1,000.00 1,016.29 1.75 8.85
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RiverPark Structural Alpha Fund -- Retail Class Shares***
Actual Fund Return 1,000.00 1,012.00 2.00 5.24**
Hypothetical 5% Return 1,000.00 1,015.04 2.00 10.10
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* Unless otherwise indicated, expenses are equal to the Fund's annualized
expense ratio multiplied by the average account value over the period,
multiplied by 183/365 (to reflect the one-half year period).
** Expenses are equal to the Fund's annualized expense ratio multiplied by
the average account value over the period, multiplied by 95/365.
*** Commenced operations on June 28, 2013.
+ The annualized expense ratios include dividend expense and stock loan fees
incurred during the six month period.
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APPROVAL OF THE INVESTMENT ADVISORY AND INVESTMENT SUB-ADVISORY AGREEMENTS
At an in-person meeting (the "Meeting") of the Board of Trustees (the "Board")
of RiverPark Funds Trust (the "Trust"), held on August 12, 2013, the Board,
including the Trustees who are not "interested persons" (the "Independent
Trustees") as defined by the Investment Company Act of 1940, as amended (the
"1940 Act"), approved the continuance of the Amended and Restated Investment
Advisory Agreement (the "Advisory Agreement") between RiverPark Advisors, LLC
(the "Adviser") and the Trust, on behalf of the RiverPark Large Growth Fund
(the "Large Growth Fund"), RiverPark/Wedgewood Fund (the "Wedgewood Fund"),
RiverPark Short Term High Yield Fund (the "High Yield Fund"), RiverPark
Long/Short Opportunity Fund (the "Long/Short Opportunity Fund") and
RiverPark/Gargoyle Hedged Value Fund (the "Hedged Value Fund", and together
with the Large Growth Fund, the Wedgewood Fund, the High Yield Fund, and the
Long/Short Opportunity Fund, the "Funds"). In addition, the Board and the
Independent Trustees approved the continuance of the sub-advisory agreements
among: (i) the Adviser, the Trust, and Cohanzick Capital Management, LLC, on
behalf of the RiverPark Short Term High Yield Fund; (ii) the Adviser, the Trust
and Wedgewood Partners, Inc., on behalf of the RiverPark/Wedgewood Fund; and
(iii) the Adviser, the Trust, and Gargoyle Investment Advisor, LLC, on behalf
of the RiverPark/Gargoyle Hedged Value Fund (collectively, the "Sub-Advisory
Agreements").
The Independent Trustees received and discussed a memorandum from the Trust's
legal counsel regarding the duties and responsibilities of the Board and the
Independent Trustees under the 1940 Act in approving or renewing investment
advisory agreements. In connection with its approval of the continuance of the
Advisory Agreement and each Sub-Advisory Agreement, the Independent Trustees
considered the following factors:
o the nature, extent and quality of service's to be provided by the
Adviser;
o the performance of the Adviser with respect to the Funds;
o the proposed fees and expenses under the Advisory Agreement;
o the economies of scale expected to be achieved;
o the costs of the services to be provided by the Adviser and each
sub-adviser and the structure of the Adviser's fees, including that
the Adviser is responsible for the payment of each sub-adviser's fees;
o the extent to which economies of scale would be realized as each Fund
grows and whether fee levels reflect any economies of scale for the
benefit of shareholders; and
o the profitability of the Adviser and its affiliates from the
relationship with each Fund.
None of these factors alone was determinative in the Independent Trustees'
decision to approve the continuance of the Advisory Agreement and each
Sub-Advisory Agreement, but each was a factor in the Independent Trustees'
consideration. The Independent Trustees were encouraged to consider any
additional factors they deemed relevant and were advised to use their own
business judgment in determining the material factors to consider in evaluating
the Advisory Agreement and the weight to be given to each factor.
In addition, the Independent Trustees discussed and considered the materials
which had been distributed to them in advance of the Board meeting. These
materials were prepared by the Adviser and the sub-advisers in response to the
questionnaires provided by Trust counsel regarding certain matters relevant to
the approval of the continuance of the Advisory Agreement and each Sub-Advisory
Agreement under Section 15(c) of the 1940 Act. These materials included, among
other things, information regarding: (a) the Adviser's and each sub-adviser's
financial soundness and ability to honor any applicable expense reimbursement
commitment; (b) information on economies of scale (if any) resulting from
growth of the Funds' assets; (c) the Adviser's and each sub-adviser's readiness
and ability to timely provide high quality and adequate information as may be
requested by the Trustees (or the Adviser, in the case of each sub-adviser);
(d) regulatory issues; (e) each of
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the Adviser's and sub-adviser's Compliance Programs (including Compliance
Manuals), Code of Ethics, and with respect to the Adviser, the report of the
Trust's chief compliance officer; and (f) other material factors affecting the
Adviser and each sub-adviser.
The Board also reviewed the information provided by the Adviser and each
sub-adviser with respect to each Fund's performance as compared with their
specific Lipper categories, Morningstar categories, benchmark indices and
comparable funds, which information served to supplement the Board's regular
quarterly review of each Fund's performance as against each Fund's relevant
categories and indices. Information on the performance of the Funds as against
Lipper categories, Morningstar categories and benchmark indices was reviewed as
provided in the materials distributed to the Board in advance of the meeting
for the following periods: (a) the month ended June 30, 2013, (b) the
three-months ended June 30, 2013; (c) the six-months ended June 30, 2013; (d)
year-to-date performance as of June 30, 2013; (e) one-year performance as of
June 30, 2013; (f) annualized three-year and inception-to-date performance as
of June 30, 2013, as applicable; and (g) cumulative performance from inception
to date. Comparable fund performance was reviewed with respect to each
comparable fund's: (i) total assets under management, (ii) net expense ratios,
(iii) gross expense ratios, (iv) percent returns for the one-month,
three-month, and twelve-month periods; and (v) percent returns for 2011 and
2012.
The Board also reviewed the recent performance of the Funds. The Board noted
the Large Growth Fund's underperformance as compared to the S&P 500 Index for
the month ended June 30, 2013 and year-to-date. The Board noted, however, that
the Large Growth Fund outperformed its Russell 1000 Growth Index, Morningstar
category and Lipper category in the recent one, three and six month periods and
year-to-date. The Board noted the outperformance of the High Yield Fund for the
month ended June 30, 2013 and three-months ended June 30, 2013, as compared to
certain Bank of America Merrill Lynch short-term indices, its Lipper categories
and Morningstar category. The Board noted the outperformance of the High Yield
Fund year-to-date as compared to certain of the Bank of America Merrill Lynch
short term indices and noted the different objectives of the High Yield Fund in
considering its underperformance relative to Lipper categories and Morningstar
categories year-to-date.
The Board reviewed the performance of the Wedgewood Fund and noted its slight
outperformance for the month ended June 30, 2013, as compared to the Russell
1000 Growth Index and its Lipper Categories, but noted its underperformance for
the same period as compared to the S&P 500 Index. The Board also noted the
Wedgewood Fund's underperformance in the recent three and six month periods,
and year to date as compared to the Russell 1000 Growth Index and the S&P 500
Index. The Board also noted that the Wedgewood Fund's performance was
relatively flat during the three months ended June 30, 2013, as compared to its
Lipper categories, but underperforming its Morningstar category. The Board
noted the Long/ Short Opportunity Fund's underperformance in the recent one,
three, and six month periods and year to date as compared to the S&P 500 Index,
its Lipper category and Morningstar category. The Board also noted the
Long/Short Fund's outperformance on an annualized basis as compared to its
Lipper categories and Morningstar category for the three-year period ended June
30, 2013. The Board noted the outperformance of the Hedged Value Fund in the
recent three and six month periods, and year to date as compared to its Lipper
categories and Morningstar categories, and its underperformance relative to the
S&P 500 Index and Russell 1000 Value Index. The Board also noted the Hedged
Value Fund's underperformance on an annualized basis as compared to the S&P 500
Index, the Russell 1000 Value Index and its Lipper categories for the
three-year period ended June 30, 2013, but noted its outperformance as compared
to its Morningstar category.
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63
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APPROVAL OF THE INVESTMENT ADVISORY AND INVESTMENT SUB-ADVISORY AGREEMENTS
(continued)
The Board noted that as compared to the comparable funds, the Funds' net
expense ratios were not the lowest, but within the range of the expense ratios
of such comparable funds. The Board noted that the Large Growth Fund and Short
Term High Yield Fund expense ratios were higher than the average of other
comparable funds, but also noted the outperformance of each of the Large Growth
Fund and Short Term High Yield Fund as against such comparable funds. With
respect to the cost of services to be provided and the profits to be realized
by the Adviser and the sub-advisers, the Board noted the continued benefit to
the Funds and their shareholders of the fee waivers and expense limitation
agreement in place between the Funds and the Adviser.
The Independent Trustees deliberated with counsel in executive session
regarding the Advisory Agreement and each Sub-Advisory Agreement. The
Independent Trustees reviewed with counsel the material factors (as noted
above) for their consideration. The Independent Trustees considered, among
other things, the extensive information provided by the Adviser and each
sub-adviser with respect to the investment performance of each Fund and
comparable fund information.
In considering the approval of the continuance of the Advisory Agreement, the
Independent Trustees discussed each Fund's performance and the overall
performance by the Adviser, their familiarity with the principals of the
Adviser, their satisfaction with the Adviser's policies and procedures and the
level of experience of the portfolio managers and their confidence in the
Adviser's ability to continue to perform based on this experience. They further
discussed the depth of resources and skill that the Adviser has demonstrated in
its management of the Funds. In addition, the Independent Trustees noted the
Adviser's demonstrated ability to comply with dynamic regulatory requirements
and continued commitment to responsiveness and compliance going forward. They
discussed the information that had been provided to them regarding the
Adviser's fees, the Adviser's profitability and the expenses of the Funds and
how this information compared to the data regarding other comparable funds. The
Independent Trustees concluded that they had received and evaluated such
information (including the Adviser's Compliance Program, Code of Ethics and the
current Advisory Agreement and Expense Limitation Agreement) as they deemed
necessary (in consultation with counsel) in order to make an informed
determination as to whether the current Advisory Agreement continues to be in
the best interest of the Trust and the Funds' shareholders. In making their
determination, no single factor was controlling in their decision, but rather
the Independent Trustees considered all of these factors in their totality.
Regarding each sub-adviser, the Independent Trustees considered the performance
of the relevant Funds and the sub-adviser's expertise in managing the
applicable strategy, as well as the performance history of the sub-adviser
demonstrated by the written materials provided in advance of the meeting. The
Independent Trustees concluded that they continued to be satisfied with each
sub-adviser's qualifications. They discussed the information that had been
provided to them regarding the fees and impact on each sub-adviser's
profitability. They determined that the contractual arrangements that had been
made between the Adviser and each sub-adviser regarding the absorption of
certain costs and expenses or the operation with reduced or waived fees on
certain assets of the relevant Funds demonstrated each sub-adviser's continued
commitment to maintaining a reasonable expense ratio. They expressed their
satisfaction with each sub-adviser's financial stability and prudent fiscal
management and noted the continued personal investments of key management in
each sub-adviser's strategy. With regard to each relevant Fund, the Independent
Trustees noted they were satisfied with the data regarding other comparable
funds and that the expense ratios of the Funds were fair and reasonable. They
concluded that they had received and evaluated such information as they deemed
necessary (in consultation with Trust counsel) to make an informed
determination as to whether each Sub-
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Advisory Agreement continues to be in the best interest of the relevant Fund
and its shareholders. In making their determination, no single factor was
controlling in their decision, but rather the Independent Trustees considered
all of these factors in their totality.
Based on the Board's deliberations and its evaluation of the information
described above, the Board, including all of the Independent Trustees,
unanimously: (a) concluded that terms of the Advisory Agreement and each
Sub-Advisory Agreement were fair and reasonable; (b) concluded that the
Adviser's and each sub-adviser's fees were reasonable in light of the services
that the Adviser and each sub-adviser provides to the Funds; and (c) agreed to
approve the continuance of the Advisory Agreement and each Sub-Advisory
Agreement through September 30, 2014.
APPROVAL OF THE INVESTMENT ADVISORY INVESTMENT SUB-ADVISORY AGREEMENTS RELATED
TO ITS NEW SERIES
RiverPark Structural Alpha Fund
At an in-person meeting of the Board of the Trust, held on May 6, 2013, the
Board, including the Independent Trustees as defined by the 1940 Act, approved
the Advisory Agreement between the Adviser and the Trust, on behalf of the
Trust's new series, the RiverPark Structural Alpha Fund (the "Structural Alpha
Fund").
The Independent Trustees received and discussed a memorandum from the Trust's
legal counsel regarding the duties and responsibilities of the Board and the
Independent Trustees under the 1940 Act in approving or renewing investment
advisory agreements. In connection with the approval of the Advisory Agreement,
the Independent Trustees considered the following factors:
o the nature, extent and quality of service's to be provided by the
Adviser;
o the anticipated performance of the Adviser with respect to the
Structural Alpha Fund;
o the proposed fees and expenses under the Advisory Agreement;
o the economies of scale expected to be achieved;
o the costs of the services to be provided by the Adviser and the
structure of the Adviser's fees;
o the extent to which economies of scale would be realized as the
Structural Alpha Fund grows and whether fee levels reflect any
economies of scale for the benefit of shareholders; and
o the potential profitability of the Adviser and its affiliates from
the relationship with the Structural Alpha Fund.
None of these factors alone was determinative in the Independent Trustees'
decision to approve the Advisory Agreement on behalf of the Structural Alpha
Fund, but each was a factor in the Independent Trustees' consideration. The
Independent Trustees were encouraged to consider any additional factors they
deemed relevant and were advised to use their own business judgment in
determining the material factors to consider in evaluating the Advisory
Agreement and the weight to be given to each factor.
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APPROVAL OF THE INVESTMENT ADVISORY AND INVESTMENT SUB-ADVISORY AGREEMENTS
(continued)
The Adviser discussed the alternative investment strategy to be followed by the
Structural Alpha Fund. The Adviser introduced the portfolio managers recently
hired by the Adviser for the management of the Structural Alpha Fund. The
portfolio managers gave a presentation to the Board regarding the alternative
investment strategy to be implemented and their backgrounds and experience. The
Adviser then reviewed with the Board the materials provided to the Board
regarding the fees and expenses of several funds comparable to the Structural
Alpha Fund. The Board noted that the Structural Alpha Fund's advisory fee was
the highest of the comparable funds. The Board also noted that the Structural
Alpha Fund's operating expenses were among the highest of the comparable funds,
but below the Morningstar Long/Short Category average. The Board also noted
that the predecessor fund for the strategy, which was managed by the two
portfolio managers, had fees that were substantially higher than the fees that
the Adviser would be paid for managing the Structural Alpha Fund. The Adviser
and the portfolio managers responded to questions from the Board regarding the
portfolio managers' backgrounds and experience in managing this strategy, the
benefits and risks associated with this alternative investment strategy, the
proposed fees and expenses of the Structural Alpha Fund and the anticipated
performance of this strategy.
Based on the Board's deliberations and its evaluation of the information
described above, the Board, including all of the Independent Trustees,
unanimously: (a) concluded that terms of the Advisory Agreement were fair and
reasonable; (b) concluded that the Adviser's fees were reasonable in light of
the services to be provided by the Adviser to the Structural Alpha Fund; and
(c) agreed to approve the Advisory Agreement for an initial two-year term.
RiverPark Strategic Income Fund
At an in-person meeting of the Board of the Trust, held on August 12, 2013, the
Board, including the Independent Trustees as defined by the 1940 Act, approved
the Advisory Agreement between the Adviser and the Trust, on behalf of the
Trust's new series, the RiverPark Strategic Income Fund (the "Strategic Income
Fund"). In addition, the Board and the Independent Trustees approved the
sub-advisory agreement among the Adviser, the Trust, on behalf of its new
series, the Strategic Income Fund, and Cohanzick Capital Management, LLC (the
"New Sub-Advisory Agreement").
The Independent Trustees received and discussed a memorandum from the Trust's
legal counsel regarding the duties and responsibilities of the Board and the
Independent Trustees under the 1940 Act in approving or renewing investment
advisory agreements. In connection with the approval of the Advisory Agreement
and the New Sub-Advisory Agreement, the Independent Trustees considered the
following factors:
o the nature, extent and quality of service's to be provided by the
Adviser;
o the anticipated performance of the Adviser and the sub-adviser with
respect to the Strategic Income Fund;
o the proposed fees and expenses under the Advisory Agreement;
o the economies of scale expected to be achieved;
o the costs of the services to be provided by the Adviser and the
sub-adviser and the structure of the Adviser's fees, including that
the Adviser is responsible for the payment of the sub-adviser's fees;
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o the extent to which economies of scale would be realized as the
Strategic Income Fund grows and whether fee levels reflect any
economies of scale for the benefit of shareholders; and
o the potential profitability of the Adviser and its affiliates from
the relationship with the Strategic Income Fund.
None of these factors alone was determinative in the Independent Trustees'
decision to approve the Advisory Agreement and the New Sub-Advisory Agreement,
but each was a factor in the Independent Trustees' consideration. The
Independent Trustees were encouraged to consider any additional factors they
deemed relevant and were advised to use their own business judgment in
determining the material factors to consider in evaluating the Advisory
Agreement and the New Sub Advisory Agreement and the weight to be given to each
factor.
As previously noted, the Board considered and reviewed the performance of the
High Yield Fund, also managed by the sub-adviser Cohanzick Management, LLC, in
connection with the continuance of the Sub Advisory Agreement on behalf of the
High Yield Fund. At the Meeting, the portfolio manager for Cohanzick
Management, LLC, gave a presentation to the Board regarding the new series, the
Strategic Income Fund. The portfolio manager discussed the strategy to be
implemented for the Strategic Income Fund. The Adviser and the portfolio
manager responded to questions from the Board regarding the portfolio manager's
background and experience in managing this strategy, the benefits and risks
associated with the strategy to be implemented, the proposed fees and expenses
of the Strategic Income Fund and the anticipated performance of this strategy.
Based on the Board's deliberations and its evaluation of the information
described above, the Board, including all of the Independent Trustees,
unanimously: (a) concluded that terms of the Advisory Agreement and the New
Sub-Advisory Agreement were fair and reasonable; (b) concluded that the
Adviser's and the sub-adviser's fees were reasonable in light of the services
to be provided to the Strategic Income Fund by the Adviser and the sub-adviser;
and (c) agreed to approve the Advisory Agreement and the New Sub-Advisory
Agreement for an initial two-year term.
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NOTICE TO SHAREHOLDERS (Unaudited)
For shareholders that do not have a September 30, 2013 tax year end, this
notice is for informational purposes only. For shareholders with a September
30, 2013 tax year end, please consult your tax advisor as to the pertinence of
this notice. For the fiscal year ended September 30, 2013, the Fund is
designating the following items with regard to distributions paid during the
year.
Long Term Ordinary
Capital Gains Income Total Qualifying
Distributions Distributions Distributions Dividends (1)
------------- ------------- ------------- -------------
RiverPark Large Growth Fund 39% 61% 100% 100%
RiverPark/Wedgewood Fund 0% 100% 100% 100%
RiverPark Short Term High Yield Fund 0% 100% 100% 0%
RiverPark Long Short Opportunity Fund 35% 65% 100% 97%
RiverPark/Gargloye Hedged Value Fund 43% 57% 100% 100%
RiverPark Structural Alpha Fund 0% 0% 0% 0%
RiverPark Strategic Income Fund 0% 0% 0% 0%
Qualifying U.S. Qualified Qualified
Dividend Government Interest Short-Term
Income (2) Income (3) Income(4) Capital Gain(5)
---------- ---------- ----------- ---------------
RiverPark Large Growth Fund 94% 0% 0% 100%
RiverPark/Wedgewood Fund 100% 0% 0% 100%
RiverPark Short Term High Yield Fund 0% 0% 100% 0%
RiverPark Long Short Opportunity Fund 97% 0% 0% 100%
RiverPark/Gargloye Hedged Value Fund 100% 0% 0% 100%
RiverPark Structural Alpha Fund 0% 0% 0% 0%
RiverPark Strategic Income Fund 0% 0% 0% 0%
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction and is reflected as a percentage of ordinary
Income distributions (the total of short term capital gain and net
investment income distributions).
(2) The percentage in this column represents the amount of "Qualifying
Dividend Income" as created by the Jobs and Growth Tax Relief
Reconciliation Act of 2003 and is reflected as a percentage of ordinary
income distributions (the total of short term capital gain and net
investment income distributions). It is the intention of each of the
aforementioned funds to designate the maximum amount permitted by law.
(3) "U.S. Government Interest" represents the amount of interest that was
derived from direct U.S. Government obligations and distributed during the
fiscal year. This amount is reflected as a percentage of ordinary income.
Generally, interest from direct U.S. Government obligations is exempt from
state income tax. However, for shareholders of the Advisors' Inner Circle
Fund -- Edgewood Growth Fund who are residents of California, Connecticut,
New Jersey and New York, the statutory threshold requirements were not
satisfied to permit exemption of these amounts from state income.
(4) The percentage in this column represents the amount of "Interest Related
Dividends" as created by the American Jobs Creation Act of 2004 and is
reflected as a percentage of net investment income distributions that is
exempt from U.S. withholding tax when paid to foreign investors.
(5) The percentage in this column represents the amount of "Short-Term Capital
Gain Dividends" as created by the American Jobs Creation Act of 2004 and is
reflected as a percentage of short-term capital gain distributions that is
exempt from U.S. withholding tax when paid to foreign investors.
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INVESTMENT ADVISER
RiverPark Advisors, LLC
156 West 56th Street, 17th Floor
New York, New York 10019
CUSTODIAN
Brown Brothers Harriman & Co.
50 Post Office Square
Boston, Massachusetts 02110-1548
PRIME BROKERS:
Goldman Sachs & Co.
200 West Street, 3(rd) Floor
New York, NY 10282
Credit Suisse Securities (USA) LLC
300 Conshohocken State Rd -- Ste 600
West Conshohocken, PA 19428
Interactive Brokers LLC
209 South LaSalle Street
Suite 1000
Chicago, IL 60604
TRANSFER AGENT
DST Systems, Inc.
333 West 11th Street, 5th Floor
Kansas City, Missouri 64105
ADMINISTRATOR
SEI Investments Global Funds Services
One Freedom Valley Drive
Oaks, Pennsylvania 19456
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Cohen Fund Audit Services, Ltd.
1350 Euclid Ave., Suite 800
Cleveland, Ohio 44115
DISTRIBUTOR
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, Pennsylvania 19456
FUND COUNSEL
Blank Rome LLP
405 Lexington Avenue
New York, New York 10174-0208
RPF-AR-001-0300
ITEM 2. CODE OF ETHICS.
A code of ethics, as defined in Item 2 of Form N-CSR, adopted by the registrant
and applicable to the registrant's principal executive officer and principal
financial officer, was in effect during the entire period covered by this
report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's board of trustees has determined that Michael Cohen, member of
the registrant's Audit Committee, is an "audit committee financial expert" and
is "independent" as that term is defined in Item 3 of Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a)-(d) Aggregate fees billed to registrant for the fiscal years ended September
30, 2013 and September 30, 2012 for professional services rendered by
registrant's principal accountant were as follows:
-------------------------------------------------------------
2013 2012
-------------------------------------------------------------
(a) Audit Fees $68,500 $58,500
-------------------------------------------------------------
(b) Audit-Related Fees $ - $ -
-------------------------------------------------------------
(c) Tax Fees $17,000 $12,500
-------------------------------------------------------------
(d) All Other Fees $ - $ -
-------------------------------------------------------------
Audit Fees include amounts related to the audit of the registrant's annual
financial statements and services normally provided by the principal accountant
in connection with statutory and regulatory filings.
All Other Fees include amounts billed for products and services other than those
disclosed in paragraphs (a) through (c) of this Item.
(e)(1) The registrant's Audit Committee has adopted, and the Board of
Trustees has ratified, an Audit and Non-Audit Services Pre-Approval Policy (the
"Policy"), which requires the registrant's Audit Committee to pre-approve all
audit and non-audit services provided by the principal accountant to the
registrant. The Policy also requires the Audit Committee to pre-approve any
engagement of the principal accountant to provide non-audit services to the
registrant's investment adviser, if the services relate directly to the
registrant's operations and financial reporting.
(e)(2) No services included in (b)-(d) above were approved pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed by registrant's principal accountant for non-audit
services rendered to the registrant, for non-audit services rendered to the
registrant's investment adviser, and for non-audit services rendered to entities
controlled by the adviser for the last fiscal year was $0.
(h) During the past fiscal year, all non-audit services provided by registrant's
principal accountant to either registrant's investment adviser or to any entity
controlling, controlled by, or under common control with registrant's investment
adviser that provides ongoing services to registrant were pre-approved by the
audit committee of registrant's board of trustees. Included in the audit
committee's pre-approval was the review and consideration as to whether the
provision of these non-audit services is compatible with maintaining the
principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end management investment companies.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND
AFFILIATED PURCHASERS.
Not applicable to open-end management investment companies.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The certifying officers, whose certifications are included herewith, have
evaluated the registrant's disclosure controls and procedures within 90 days of
the filing date of this report. In their opinion, based on their evaluation,
the registrant's disclosure controls and procedures are adequately designed, and
are operating effectively to ensure, that information required to be disclosed
by the registrant in the reports it files or submits under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the
time periods specified in the Securities and Exchange Commission's rules and
forms.
(b) There were no significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal half-year
that have materially affected, or are reasonably likely to materially affect,
the registrant's internal control over financial reporting.
ITEMS 12. EXHIBITS.
(a)(1) The registrant's code of ethics pursuant to Item 2 of Form N-CSR is
attached.
(a)(2) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment
Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing
as an Exhibit.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) RiverPark Funds Trust
By (Signature and Title)* /s/ Morty Schaja
----------------
Morty Schaja
President
Date: December 9, 2013
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Morty Schaja
----------------
Morty Schaja
President
Date: December 9, 2013
By (Signature and Title)* /s/ Michael Lawson
------------------
Michael Lawson
Chief Financial Officer and
Treasurer
Date: December 9, 2013
* Print the name and title of each signing officer under his or her
signature.