Form N-CSR Nuveen Intermediate Dura For: May 31
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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 811-22779
Nuveen Intermediate Duration Quality Municipal Term Fund
(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
(Address of principal executive offices) (Zip code)
Mark L. Winget
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
(Name and address of agent for service)
Registrant’s telephone number, including area code: (312) 917-7700
Date of fiscal year end: Date: May 31
Date of reporting period: May 31, 2022
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
| Closed-End | 31 May |
| Funds | 2022 |
Nuveen Municipal Closed-End Funds
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| NIQ | Nuveen Intermediate Duration Quality Municipal Term Fund |
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Table of Contents
| Chair’s Letter to Shareholders | 4 |
| Important Notices | 5 |
| Portfolio Managers' Comments | 6 |
| Fund Leverage | 9 |
| Common Share Information | 11 |
| Performance Overview and Holding Summaries | 13 |
| Shareholder Meeting Report | 17 |
| Report of Independent Registered Public Accounting Firm | 18 |
| Portfolios of Investments | 19 |
| Statement of Assets and Liabilities | 46 |
| Statement of Operations | 47 |
| Statement of Changes in Net Assets | 48 |
| Statement of Cash Flows | 49 |
| Financial Highlights | 50 |
| Notes to Financial Statements | 53 |
| Shareholder Update | 65 |
| Important Tax Information | 86 |
| Additional Fund Information | 87 |
| Glossary of Terms Used in this Report | 88 |
| Annual Investment Management Agreement Approval Process | 90 |
| Board Members & Officers | 100 |
3
Chair’s Letter
to Shareholders
Dear Shareholders,
The first half of 2022 has been challenging for financial markets. While global economic activity began to slow from post-pandemic peaks as pent-up demand waned and crisis-era monetary and fiscal support programs were phased out, persistently high inflation and central banks’ response have contributed to heightened uncertainty about financial and economic conditions.
Inflation has surged partially due to supply chain bottlenecks and exacerbated by Russia’s war in Ukraine and recent lockdowns across China to contain a large-scale COVID-19 outbreak. This has necessitated more forceful responses from the U.S. Federal Reserve (Fed) and other central banks, who now face an even more difficult task of slowing inflation without pulling their respective economies into recession. As anticipated, the Fed began the rate hiking cycle in March 2022, raising its short-term rate by 0.25% from near zero for the first time since the pandemic was declared two years ago. Larger increases of 0.50% in May and 0.75% in June 2022 followed, bringing the target fed funds rate to a range of 1.50% to 1.75%. Additional rate hikes of these larger magnitudes are expected in the remainder of this year, although Fed officials will closely monitor inflation data along with other economic measures and modify their rate setting policy based upon these factors. With inflation lingering at a 40-year high and consumer sentiment indicators slumping, markets are pricing increased recession risks.
In the meantime, while markets will likely continue fluctuating with the daily headlines, we encourage investors to keep a long-term perspective. To learn more about how well your portfolio is aligned to your time horizon, risk tolerance and investment goals, consider reviewing it with your financial professional.
On behalf of the other members of the Nuveen Fund Board, I look forward to continuing to earn your trust in the months and years ahead.
Sincerely,
Terence
J. Toth
Chair of the Board
July 22, 2022
4
Important Notices
For Shareholders of
Nuveen Intermediate Duration Municipal Term Fund (NID)
Nuveen Intermediate Duration Quality Municipal Term Fund (NIQ)
NID and NIQ Announce Shareholder Proposals
On June 14, 2022, the Board of Trustees for NID and NIQ approved a proposal that will allow each fund’s shareholders the opportunity to maintain their investment in the fund and its exposure to leveraged, intermediate duration municipal securities.
In light of the upcoming scheduled terminations of NID on March 31, 2023 and NIQ on June 30, 2023, the proposal asks shareholders of each NID and NIQ to vote to amend their respective fund’s declaration of trust to eliminate the term structure at a special meeting of shareholders on October 12. For each fund, if the amendment is approved by shareholders, the fund will conduct a tender offer for 100% of its outstanding common shares at net asset value. If the fund’s common assets taking into account common shares properly tendered in the tender offer would be $70 million or greater, the tender offer will be completed and the fund’s term will be eliminated. If the fund’s common assets after the tender offer would be less than $70 million, the tender offer will be cancelled with no common shares repurchased, and instead, the fund will proceed to terminate as scheduled.
As part of the proposal, if a fund’s term is eliminated, the fund’s name will change to reflect the elimination. NID’s name will change to “Nuveen Intermediate Duration Municipal Fund” and NIQ’s name will change to “Nuveen Intermediate Duration Quality Municipal Fund.” In addition, if a fund’s term is eliminated, the common shares of the fund will continue to trade on the New York Stock Exchange under the current ticker symbol, and Nuveen will waive 50% of its net management fees over the first year following the elimination of the term, which may enhance the net earnings of the fund.
The changes described above will take effect with respect to a fund only if shareholders of such fund approves the proposal described above and the tender offer condition is satisfied for such fund.
5
Portfolio Managers’ Comments
Nuveen Intermediate Duration Municipal Term Fund (NID)
Nuveen Intermediate Duration Quality Municipal Term Fund (NIQ)
These Funds feature portfolio management by Nuveen Asset Management, LLC (NAM), an affiliate of Nuveen Fund Advisors, LLC, the Funds’ investment adviser. Portfolio managers John V. Miller, CFA, Timothy T. Ryan, CFA, Steven M. Hlavin manage the Nuveen Intermediate Duration Municipal Term Fund (NID) and Daniel J. Close, CFA, manages the Nuveen Intermediate Duration Quality Municipal Term Fund (NIQ).
Here the Funds’ portfolio managers review U.S. economic and municipal market conditions, key investment strategies and the performance of the Funds for the twelve-month reporting period ended May 31, 2022. For more information on the Funds’ investment objectives and policies, please refer to the Shareholder Update section at the end of the report.
What factors affected the U.S. economy and the municipal bond market during the twelve-month annual reporting period ended May 31, 2022?
After making a full recovery from the pandemic in 2021, the U.S. economy unexpectedly weakened at the start of 2022. Overall, 2021 gross domestic product (GDP) grew by 5.7% as the economy reopened with the help of $5.3 trillion in crisis-related aid from the federal government, low borrowing rates for businesses and individuals, an increase in COVID-19 vaccinations and improved treatments for COVID-19. In the first quarter of 2022, strong domestic consumer demand was offset by two factors: China’s lock-down to contain a domestic COVID-19 outbreak, and lingering supply chain disruptions that were exacerbated by the Russia-Ukraine war. This reduced U.S. GDP by 1.5% on an annualized basis, according to the second estimate from the U.S. Bureau of Economic Analysis.
The return of consumer demand in early 2022 put upward pressure on inflation. However, as supply chains remained under stress and labor shortages continued, inflation appeared to be more durable than initially expected. The U.S. Federal Reserve (Fed) responded by reducing its pandemic-era support programs and beginning a more aggressive interest rate hiking cycle. Starting with a 0.25% hike in March 2022, the Fed followed with larger target rate increases of 0.50% in May 2022 and (after the close of this reporting period) 0.75% in June 2022. Interest rate and stock price volatility increased as markets considered whether the Fed could cool inflation without pulling the economy into a recession. While some pandemic-related risks appeared to be receding, Russia’s invasion of Ukraine in late February 2022 caused significant economic consequences. Anticipated supply disruptions in
This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy, sell or hold a security or an investment strategy and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor, or suggest any specific course of action. Investment decisions should be made based on an investor’s objectives and circumstances and in consultation with his or her advisors.
Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio managers as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
For financial reporting purposes, the ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group (S&P), Moody’s Investors Service, Inc. (Moody’s) or Fitch, Inc. (Fitch). This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings, while BB, B, CCC, CC, C and D are below investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
Bond insurance guarantees only the payment of principal and interest on the bond when due, and not the value of the bonds themselves, which will fluctuate with the bond market and the financial success of the issuer and the insurer. Insurance relates specifically to the bonds in the portfolio and not to the share prices of a Fund. No representation is made as to the insurers’ ability to meet their commitments.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
6
energy, metals and grains caused inflationary pressures to rise. Downside risks to global economic growth increased, and economic sanctions from Western countries sought to block Russia’s access to the global financial system. A more uncertain outlook for inflation and economic growth also made the path toward monetary policy normalization more uncertain for the Fed and other central banks, contributing to elevated market volatility toward the end of the reporting period.
The broad municipal bond market declined over the twelve-month reporting period, primarily driven by interest rate and economic uncertainty in the second half of the reporting period. Municipal yields rose across the maturity spectrum, with a greater increase at the shorter end of the curve as markets priced in a more aggressive pace of monetary tightening. The yield curve flattened overall and shorter maturities outperformed longer maturities. Demand for municipal debt remained remarkably strong throughout 2021, but at the beginning of 2022, the municipal bond market experienced outflows. In response to the rising interest rate environment and heightened market volatility, dealers reduced their inventories and investors increased redemptions from traditional municipal bond mutual funds. For much of the reporting period, credit spreads were generally stable given relatively strong municipal fundamentals, but widening began in the later months of the period as the market sold off.
Nuveen Intermediate Duration Municipal Term Fund (NID)
What key strategies were used to manage the Funds during the twelve-month reporting period ended May 31, 2022?
The Fund’s primary investment objective is to provide current income exempt from regular federal income tax. The Fund’s secondary investment objective is to seek additional total return. NID has a 10-year term and intends to liquidate and distribute its then-current net assets to shareholders on or before March 31, 2023. As discussed in the Important Notices section of this report, the Board of Trustees for NID approved a proposal to ask shareholders to vote to amend the Fund’s declaration of trust to eliminate the term structure. The Fund uses leverage.
At the end of the reporting period, NID remained well positioned heading toward its term date in March 2023. Over the twelvemonth period, the Fund’s trading activity focused on reinvesting the proceeds from called and maturing bonds in sectors and credits that maintained the portfolio’s overall positioning. During the market sell-off in the later months of the reporting period, NID more actively pursued tax-loss swapping opportunities and deployed cash toward fundamentally attractive names that were now available at cheaper valuations. Tax-loss swapping is a strategy that entails selling depreciated positions with lower embedded yields and reinvesting into similarly structured bonds with higher embedded yields to provide tax efficiencies and support the Fund’s income generation. As the market sell-off caused price dislocations for large, established names such as Puerto Rico general obligation debt and tobacco securitization bonds, the Fund bought these bonds at attractive discounts. These types of bonds underperformed because of their greater liquidity, as they tend to be among the first bonds sold in times of market stress, and not because of fundamental reasons. The Fund continued to short interest rate futures contracts as part of its duration management strategy.
How did the Fund perform during the twelve-month reporting period ended May 31, 2022?
For the twelve months ended May 31, 2022, NID outperformed the S&P Intermediate Duration Municipal Yield Index. For the purposes of this Performance Commentary, the references to relative performance of NID are in comparison to the S&P Intermediate Duration Municipal Yield Index.
The Fund’s outperformance was largely driven by favorable credit selection, along with modest contributions from sector allocations. A small overweight to below investment grade and non-rated bonds slightly added to relative gains, as these segments outperformed. Sector allocations also modestly contributed to relative performance. The Fund held underweights to the underper-forming state and local general obligation sectors and overweights to the outperforming tobacco and utilities sectors. These positions more than offset an overweight to hospitals, an underperforming sector that detracted from relative performance.
Additionally, Energy Harbor common stock was a top individual performance contributor during this reporting period. This equity position came into the portfolio in 2020 as part of the bankruptcy restructuring of FirstEnergy Solutions, the predecessor of Energy Harbor and a former Fund holding. Energy Harbor’s shares rose meaningfully during the reporting period given strong demand for energy generation as the economy reopened. An overweight position in Brightline was another notable positive individual
7
Portfolio Managers’ Comments (continued)
contributor. The Florida high-speed passenger rail system performed well amid the post-pandemic reopening of its service and progress in construction and expansion of its train lines. Both of these positions were still held in the Fund at the end of the reporting period. The Fund also managed the duration of its portfolio by shorting interest rate futures contracts, which had a positive impact on performance during the reporting period.
Partially offsetting the relative contributors was the Fund’s use of leverage. The Fund’s use of leverage through the issuance of preferred shares and investments in floating rate securities, which represent leveraged instruments in underlying bonds, significantly detracted from relative performance during the reporting period. Please see the Fund Leverage section in this report for additional details.
Nuveen Intermediate Duration Quality Municipal Term Fund (NIQ)
What key strategies were used to manage the Fund during the twelve-month reporting period ended May 31, 2022?
The Fund’s primary investment objective is to provide current income exempt from regular federal income tax. The Fund’s secondary investment objective is to seek additional total return. NIQ has a 10-year term and intends to liquidate and distribute its then-current net assets to shareholders on or before June 30, 2023. As discussed in the Important Notices section of this report, the Board of Trustees for NIQ approved a proposal to ask shareholders to vote to amend the Fund’s declaration of trust to eliminate the term structure. The Fund uses leverage.
At the end of the reporting period, NIQ remained well positioned to meet its term date in June 2023. Activity was relatively light in the first half of the reporting period, when buying was largely driven by the reinvestment of proceeds from called and maturing bonds into positions that maintained the Fund’s overall positioning. The market sell-off in the second half of the reporting period presented opportunities to add bonds at attractive valuations, such as New Jersey state appropriation debt, Metropolitan Washington D.C. Airport Authority Dulles Toll Road Revenue Bonds, and Buckeye Tobacco. The Fund also took advantage of prevailing market conditions to engage in tax-loss swapping. This strategy entails selling depreciated securities with lower embedded yields and reinvesting into similarly structured bonds with higher embedded yields to provide tax efficiencies and support the Fund’s income generation.
How did the Fund perform during the twelve-month reporting period ended May 31, 2022?
For the twelve months ended May 31, 2022, NIQ underperformed the S&P Municipal Bond Intermediate Index. For the purposes of this Performance Commentary, the references to relative performance of NIQ are in comparison to the S&P Municipal Bond Intermediate Index.
The Fund’s use of leverage through the issuance of preferred shares and investments in floating rate securities, which represent leveraged instruments in underlying bonds, significantly detracted from relative performance during the reporting period. Leverage is discussed in more detail later in the Fund Leverage section of this report.
Partially offsetting the detraction from leverage were positive contributions from duration (excluding the impact of leverage) and credit quality positioning. The Fund’s overweight in bonds with durations of two years and shorter was a positive contributor because shorter-duration bonds outperformed, which more than offset a slightly negative impact from overweight allocations to durations of 10 years and longer. Credit quality positioning contributed positively overall. While the portfolio’s overweight to the underperforming A rated credit category dampened relative performance, the outperformance of the portfolio’s exposures to non-rated securities, including Energy Harbor common stock, more than compensated. The Energy Harbor equity position came into the portfolio in 2020 as part of the bankruptcy restructuring of FirstEnergy Solutions, the predecessor of Energy Harbor and a former portfolio holding. Energy Harbor’s shares rose meaningfully during the reporting period given strong demand for energy generation as the economy reopened, and were still held at the end of the period.
8
Fund Leverage
IMPACT OF THE FUNDS’ LEVERAGE STRATEGIES ON PERFORMANCE
One important factor impacting the returns of the Funds’ common shares relative to their comparative benchmarks was the Funds’ use of leverage through their issuance of preferred shares and/or investments in inverse floating rate securities, which represent leveraged investments in underlying bonds. The Funds use leverage because our research has shown that, over time, leveraging provides opportunities for additional income. The opportunity arises when short-term rates that a Fund pays on its leveraging instruments are lower than the interest a Fund earns on its portfolio of long-term bonds that it has bought with the proceeds of that leverage. This has been particularly true in the recent market environment where short-term rates have been low by historical standards.
However, use of leverage can expose Fund common shares to additional price volatility. When a Fund uses leverage, the Fund’s common shares will experience a greater increase in their net asset value if the municipal bonds acquired through the use of leverage increase in value, but will also experience a correspondingly larger decline in their net asset value if the bonds acquired through leverage decline in value. All this will make the shares’ total return performance more variable over time.
In addition, common share income in levered funds will typically decrease in comparison to unlevered funds when short-term interest rates increase and increase when short-term interest rates decrease. In recent quarters, fund leverage expenses have generally tracked the overall movement of short-term tax-exempt interest rates. While fund leverage expenses are somewhat higher than their recent lows, leverage nevertheless continues to provide the opportunity for incremental common share income, particularly over longer-term periods.
Leverage had a negative impact on the total return performance of the Funds, particularly in NIQ, over the reporting period.
As of May 31, 2022, the Funds’ percentages of leverage are as shown in the accompanying table.
| NID | NIQ | |
| Effective Leverage* | 35.63% | 33.69% |
| Regulatory Leverage* | 21.25% | 23.79% |
| * | Effective Leverage is a Fund’s effective economic leverage, and includes both regulatory leverage and the leverage effects of certain derivative and other investments in a Fund’s portfolio that increase the Fund’s investment exposure. Currently, the leverage effects of Tender Option Bond (TOB) inverse floater holdings are included in effective leverage values, in addition to any regulatory leverage. Regulatory leverage consists of preferred shares issued or borrowings of a Fund. Both of these are part of a Fund’s capital structure. A Fund, however, may from time to time borrow on a typically transient basis in connection with its day-to-day operations, primarily in connection with the need to settle portfolio trades. Such incidental borrowings are excluded from the calculation of a Fund’s effective leverage ratio. Regulatory leverage is subject to asset coverage limits set forth in the Investment Company Act of 1940. |
9
Fund Leverage (continued)
THE FUNDS’ REGULATORY LEVERAGE
As of May 31, 2022, the Funds have issued and outstanding preferred shares as shown in the accompanying table.
| Variable Rate | |||
| Variable Rate | Remarketed | ||
| Preferred* | Preferred** | ||
| Shares | Shares | ||
| Issued at | Issued at | ||
| Liquidation | Liquidation | ||
| Preference | Preference | Total | |
| NID | $175,000,000 | $ — | $175,000,000 |
| NIQ | $ 55,000,000 | $ — | $ 55,000,000 |
| * | Preferred shares of the Fund featuring a floating rate dividend based on a predetermined formula or spread to an index rate. Includes the following preferred shares AMTP, iMTP, MFP-VRM and VRDP in Special Rate Mode, where applicable. See Notes to Financial Statements, Note 5 – Fund Shares for further details. |
| ** | Preferred shares of the Fund featuring floating rate dividends set by a remarketing agent via a regular remarketing. Includes the following preferred shares VRDP not in Special Rate Mode, MFP-VRRM and MFP-VRDM, where applicable. See Notes to Financial Statements, Note 5 – Fund Shares for further details. |
Refer to Notes to Financial Statements, Note 5 – Fund Shares for further details on preferred shares and each Fund’s respective transactions.
10
Common Share Information
COMMON SHARE DISTRIBUTION INFORMATION
The following information regarding the Funds’ distributions is current as of May 31, 2022. Each Fund’s distribution levels may vary
over time based on each Fund’s investment activity and portfolio investment value changes.
During the current reporting period, each Fund’s distributions to common shareholders were as shown in the accompanying table.
| Per Common | ||
| Share Amounts | ||
| Month Distributions (Ex-Dividend Date) | NID | NIQ |
| June 2021 | $0.0440 | $0.0425 |
| July | 0.0465 | 0.0425 |
| August | 0.0465 | 0.0425 |
| September | 0.0465 | 0.0425 |
| October | 0.0465 | 0.0425 |
| November | 0.0465 | 0.0425 |
| December | 0.0465 | 0.0425 |
| January | 0.0465 | 0.0385 |
| February | 0.0465 | 0.0385 |
| March | 0.0465 | 0.0385 |
| April | 0.0465 | 0.0385 |
| May 2022 | 0.0465 | 0.0385 |
| Total Distributions from Net Investment Income | $0.5555 | $0.4900 |
| Yields | ||
| Market Yield* | 4.07% | 3.51% |
| Taxable-Equivalent Yield* | 6.86% | 5.93% |
| * | Market Yield is based on the Fund’s current annualized monthly dividend divided by the Fund’s current market price as of the end of the reporting period. Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on an income tax rate of 40.8%. Your actual federal income tax rate may differ from the assumed rate. The Taxable-Equivalent Yield also takes into account the percentage of the Fund’s income generated and paid by the Fund (based on payments made during the previous calendar year) that was not exempt from federal income tax. Separately, if the comparison were instead to investments that generate qualified dividend income, which is taxable at a rate lower than an individual’s ordinary graduated tax rate, the fund’s Taxable-Equivalent Yield would be lower. |
Each Fund seeks to pay regular monthly dividends out of its net investment income at a rate that reflects its past and projected net income performance. To permit each Fund to maintain a more stable monthly dividend, the Fund may pay dividends at a rate that may be more or less than the amount of net income actually earned by the Fund during the period. Distributions to common shareholders are determined on a tax basis, which may differ from amounts recorded in the accounting records. In instances where the monthly dividend exceeds the earned net investment income, the Fund would report a negative undistributed net ordinary income. Refer to Note 6 – Income Tax Information for additional information regarding the amounts of undistributed net ordinary income and undistributed net long-term capital gains and the character of the actual distributions paid by the Fund during the period.
11
Common Share Information (continued)
All monthly dividends paid by each Fund during the current reporting period were paid from net investment income. If a portion of the Fund’s monthly distributions is sourced from or comprised of elements other than net investment income, including capital gains and/or a return of capital, shareholders will be notified of those sources. For financial reporting purposes, per share amounts of each Fund’s distributions for the reporting period are presented in this report’s Financial Highlights. For income tax purposes, distribution information for each Fund as of its most recent tax year end is presented in Note 6 — Income Tax Information within the Notes to Financial Statements of this report.
NUVEEN CLOSED-END FUND DISTRIBUTION AMOUNTS
The Nuveen Closed-End Funds’ monthly and quarterly periodic distributions to shareholders are posted on www.nuveen.com and can be found on Nuveen’s enhanced closed-end fund resource page, which is at https://www.nuveen.com/resource-center-closed-end-funds, along with other Nuveen closed-end fund product updates. To ensure timely access to the latest information, shareholders may use a subscribe function, which can be activated at this web page (https://www.nuveen.com/subscriptions).
COMMON SHARE REPURCHASES
During August 2022, the Funds’ Board of Trustees reauthorized an open-market share repurchase program, allowing each Fund to repurchase an aggregate of up to approximately 10% of its outstanding shares. During the current reporting period, the Funds did not repurchase any of their outstanding common shares. As of May 31, 2022 (and since the inception of the Funds’ repurchase programs), the Funds have cumulatively repurchased and retired their outstanding common shares as shown in the accompanying table.
| NID | NIQ | |
| Common shares cumulatively repurchased and retired | 0 | 0 |
| Common shares authorized for repurchase | 4,690,000 | 1,305,000 |
OTHER COMMON SHARE INFORMATION
As of May 31, 2022, the Funds’ common share prices were trading at a premium/(discount) to their common share NAVs, and trading
at an average premium/(discount) to NAV during the current reporting period, as follows:
| NID | NIQ | |
| Common share NAV | $13.82 | $13.45 |
| Common share price | $13.70 | $13.15 |
| Premium/(Discount) to NAV | (0.87)% | (2.23)% |
| Average premium/(discount) to NAV | (1.05)% | (1.05)% |
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| NID | Nuveen Intermediate Duration Municipal |
| Term Fund | |
| Performance Overview and Holding Summaries as of | |
| May 31, 2022 |
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
Average Annual Total Returns as of May 31, 2022*
| Average Annual | |||
| Since | |||
| 1-Year | 5-Year | Inception | |
| NID at Common Share NAV | (2.73)% | 4.07% | 3.98% |
| NID at Common Share Price | (1.41)% | 4.58% | 3.64% |
| S&P Intermediate Duration Municipal Yield Index | (4.71)% | 3.16% | 3.37% |
| * | For purposes of Fund performance, relative results are measured against the S&P Intermediate Duration Municipal Yield Index. |
Since inception returns are from 12/05/12. Performance data shown represents past performance and does not predict or guarantee future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Returns at NAV are net of Fund expenses, and assume reinvestment of distributions. Comparative index return information is provided for the Fund’s shares at NAV only. Indexes are not available for direct investment.
Daily Common Share NAV and Share Price
Growth of an Assumed $10,000 Investment as of May 31, 2022 - Common Share Price
13
| NID | Performance Overview and Holding Summaries as of |
| May 31, 2022 (continued) |
This data relates to the securities held in the Fund’s portfolio of investments as of the end of the reporting period. It should not be construed as a measure of performance for the Fund itself. Holdings are subject to change.
The ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group, Moody’s Investors Service, Inc. or Fitch, Inc. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings; BB, B, CCC, CC, C and D are below-investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
| Fund Allocation | |
| (% of net assets) | |
| Long-Term Municipal Bonds | 116.6% |
| Common Stocks | 9.7% |
| Other Assets Less Liabilities | 5.0% |
| Net Assets Plus Floating Rate | |
| Obligations & AMTP Shares, | |
| net of deferred offering costs | 131.3% |
| Floating Rate Obligations | (4.3)% |
| AMTP Shares, net of deferred | |
| offering costs | (27.0)% |
| Net Assets | 100% |
| Portfolio Credit Quality | |
| (% of total investment exposure) | |
| U.S. Guaranteed | 8.1% |
| AAA | 0.3% |
| AA | 19.9% |
| A | 11.1% |
| BBB | 22.1% |
| BB or Lower | 13.8% |
| N/R (not rated) | 18.2% |
| N/A (not applicable) | 6.5% |
| Total | 100% |
| Portfolio Composition | |
| (% of total investments) | |
| Tax Obligation/Limited | 21.8% |
| Utilities | 15.4% |
| Transportation | 14.9% |
| Tax Obligation/General | 12.5% |
| Health Care | 11.9% |
| U.S. Guaranteed | 5.4% |
| Consumer Staples | 4.9% |
| Other | 13.2% |
| Total | 100% |
| States and Territories1 | |
| (as a % of total municipal bonds) | |
| Illinois | 12.5% |
| New York | 9.6% |
| New Jersey | 9.3% |
| California | 9.0% |
| Florida | 8.8% |
| Puerto Rico | 8.1% |
| Pennsylvania | 4.2% |
| Ohio | 3.7% |
| Texas | 3.5% |
| Michigan | 3.0% |
| Wisconsin | 2.7% |
| Colorado | 2.6% |
| Guam | 2.6% |
| Washington | 2.2% |
| Other | 18.2% |
| Total | 100% |
1 See Portfolio of Investments for the states comprising “Other” and not listed in the States and Territories above.
14
| NIQ | Nuveen Intermediate Duration Quality |
| Municipal Term Fund | |
| Performance Overview and Holding Summaries as of | |
| May 31, 2022 |
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
Average Annual Total Returns as of May 31, 2022*
| Average Annual | |||
| Since | |||
| 1-Year | 5-Year | Inception | |
| NIQ at Common Share NAV | (7.00)% | 2.33 % | 2.84% |
| NIQ at Common Share Price | (8.23)% | 3.21% | 2.31% |
| S&P Municipal Bond Intermediate Index | (5.90)% | 1.69% | 2.26% |
* For purposes of Fund performance, relative results are measured against the S&P Municipal Bond Intermediate Index.
Since inception returns are from 2/07/13. Performance data shown represents past performance and does not predict or guarantee future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Returns at NAV are net of Fund expenses, and assume reinvestment of distributions. Comparative index return information is provided for the Fund’s shares at NAV only. Indexes are not available for direct investment.
Daily Common Share NAV and Share Price
Growth of an Assumed $10,000 Investment as of May 31, 2022 - Common Share Price
15
| NIQ | Performance Overview and Holding Summaries as of |
| May 31, 2022 (continued) |
This data relates to the securities held in the Fund’s portfolio of investments as of the end of the reporting period. It should not be construed as a measure of performance for the Fund itself. Holdings are subject to change.
The ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group, Moody’s Investors Service, Inc. or Fitch, Inc. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings; BB, B, CCC, CC, C and D are below-investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
| Fund Allocation | |
| (% of net assets) | |
| Long-Term Municipal Bonds | 123.4% |
| Common Stocks | 3.6% |
| Other Assets Less Liabilities | 4.2% |
| Net Assets Plus AMTP Shares, | |
| net of deferred offering costs | 131.2% |
| AMTP Shares, net of deferred | |
| offering costs | (31.2)% |
| Net Assets | 100% |
| Portfolio Credit Quality | |
| (% of total investment exposure) | |
| U.S. Guaranteed | 6.2% |
| AAA | 0.3% |
| AA | 27.8% |
| A | 28.0% |
| BBB | 19.7% |
| BB or Lower | 2.7% |
| N/R (not rated) | 12.8% |
| N/A (not applicable) | 2.5% |
| Total | 100% |
| Portfolio Composition | |
| (% of total investments) | |
| Utilities | 29.6% |
| Transportation | 16.6% |
| Tax Obligation/Limited | 15.4% |
| Health Care | 13.3% |
| Tax Obligation/General | 8.5% |
| Education and Civic Organizations | 7.5% |
| Other | 9.1% |
| Total | 100% |
| States and Territories1 | |
| (as a % of total municipal bonds) | |
| Colorado | 10.0% |
| Illinois | 9.0% |
| California | 8.9% |
| Tennessee | 8.3% |
| New York | 7.7% |
| Michigan | 6.8% |
| Florida | 4.5% |
| Texas | 4.3% |
| District of Columbia | 3.2% |
| Kentucky | 3.0% |
| Ohio | 2.9% |
| Maine | 2.3% |
| New Jersey | 2.2% |
| South Carolina | 2.1% |
| Georgia | 2.1% |
| Nevada | 2.0% |
| Arizona | 1.9% |
| Other | 18.8% |
| Total | 100% |
1 See Portfolio of Investments for the states comprising “Other” and not listed in the States and Territories above.
16
Shareholder Meeting Report
The annual meeting of shareholders was held on April 8, 2022 for NID and NIQ. The meeting was held virtually due to public health concerns regarding the ongoing COVID-19 pandemic; at this meeting the shareholders were asked to elect Board members.
| NID | NIQ | |||||
| Common and | Common and | |||||
| Preferred shares | Preferred shares | |||||
| voting together | Preferred | voting together | Preferred | |||
| as a class | Shares | as a class | Shares | |||
| Approval of the Board Members was reached as follows: | ||||||
| Judith M. Stockdale | ||||||
| For | 39,881,141 | — | 11,645,415 | — | ||
| Withhold | 756,850 | — | 49,297 | — | ||
| Total | 40,637,991 | — | 11,694,712 | — | ||
| Carole E. Stone | ||||||
| For | 39,882,195 | — | 11,641,046 | — | ||
| Withhold | 755,796 | — | 53,666 | — | ||
| Total | 40,637,991 | — | 11,694,712 | — | ||
| Margaret L. Wolff | ||||||
| For | 39,978,297 | — | 11,641,397 | — | ||
| Withhold | 659,694 | — | 53,315 | — | ||
| Total | 40,637,991 | — | 11,694,712 | — | ||
| William C. Hunter | ||||||
| For | — | 1,750 | — | 550 | ||
| Withhold | — | — | — | — | ||
| Total | — | 1,750 | — | 550 | ||
| Albin F. Moschner | ||||||
| For | — | 1,750 | — | 550 | ||
| Withhold | — | — | — | — | ||
| Total | — | 1,750 | — | 550 |
17
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees
Nuveen Intermediate Duration Municipal Term Fund and Nuveen Intermediate Duration Quality Municipal Term Fund:
Opinion on the Financial Statements
We have audited the accompanying statements of assets and liabilities of Nuveen Intermediate Duration Municipal Term Fund and Nuveen Intermediate Duration Quality Municipal Term Fund (the Funds), including the portfolios of investments, as of May 31, 2022, the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the related notes (collectively, the financial statements) and the financial highlights for each of the years in the five-year period then ended. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Funds as of May 31, 2022, the results of their operations and their cash flows for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.
Basis for Opinion
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 are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. 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, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Such procedures also included confirmation of securities owned as of May 31, 2022, by correspondence with custodians and brokers; when replies were not received from brokers, we performed other auditing procedures. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. We believe that our audits provide a reasonable basis for our opinion.
/s/ KPMG LLP
We have served as the auditor of one or more Nuveen investment companies since 2014.
Chicago, Illinois
July 28, 2022
18
| NID | Nuveen Intermediate Duration Municipal |
| Term Fund | |
| Portfolio of Investments | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| LONG-TERM INVESTMENTS – 126.3% (100.0% of Total Investments) | ||||
| MUNICIPAL BONDS – 116.6% (92.3% of Total Investments) | ||||
| Alabama – 0.1% (0.1% of Total Investments) | ||||
| $ 755 | Hoover Industrial Development Board, Alabama, Environmental Improvement Revenue Bonds, | 10/29 at 100.00 | B | $ 818,722 |
| United States Steel Corporation Project, Series 2019, 5.750%, 10/01/49, (AMT) | ||||
| Arizona – 0.7% (0.5% of Total Investments) | ||||
| 680 | Estrella Mountain Ranch Community Facilities District, Goodyear, Arizona, Special | 7/25 at 100.00 | N/R | 681,578 |
| Assessment Revenue Bonds, Montecito Assessment District 2, Series 2015, 4.750%, 7/01/30, 144A | ||||
| 230 | Florence Town Inc., Industrial Development Authority, Arizona, Education Revenue Bonds, | No Opt. Call | BB+ (4) | 234,372 |
| Legacy Traditional School Project – Queen Creek and Casa Grande Campuses, Series 2013, | ||||
| 5.000%, 7/01/23, (ETM) | ||||
| 2,000 | Phoenix Civic Improvement Corporation, Arizona, Rental Car Facility Charge Revenue | 7/29 at 100.00 | A3 | 2,255,920 |
| Bonds, Series 2019A, 5.000%, 7/01/32 | ||||
| 290 | Phoenix Industrial Development Authority, Arizona, Education Facility Revenue Bonds, | 7/25 at 100.00 | BB+ | 295,031 |
| Legacy Traditional Schools Projects, Series 2015, 5.000%, 7/01/45, 144A | ||||
| 1,000 | Phoenix Industrial Development Authority, Arizona, Lease Revenue Bonds, Guam Facilities | 2/24 at 100.00 | B+ | 999,380 |
| Foundation, Inc. Project, Series 2014, 5.125%, 2/01/34 | ||||
| 4,200 | Total Arizona | 4,466,281 | ||
| Arkansas – 0.4% (0.3% of Total Investments) | ||||
| 2,665 | Arkansas Development Finance Authority, Industrial Development Revenue Bonds, Big River | 9/26 at 103.00 | Ba3 | 2,684,561 |
| Steel Project, Series 2019, 4.500%, 9/01/49, (AMT), 144A | ||||
| California – 10.5% (8.4% of Total Investments) | ||||
| 1,850 | Alameda Corridor Transportation Authority, California, Revenue Bonds, Refunding Second | 10/26 at 100.00 | AA | 1,886,260 |
| Subordinate Lien Series 2016B, 4.000%, 10/01/35 – AGM Insured | ||||
| 2,490 | Alvord Unified School District, Riverside County, California, General Obligation Bonds, | No Opt. Call | AA | 4,188,753 |
| Tender Option Bond Trust 2016-XG0089, 23.904%, 8/01/30, 144A, (IF) (5) | ||||
| 1,000 | California Community Housing Agency, California, Essential Housing Revenue Bonds, | 8/32 at 100.00 | N/R | 809,270 |
| Exchange at Bayfront Apartments, Junior Series 2021A-2, 4.000%, 8/01/51, 144A | ||||
| 3,440 | California Community Housing Agency, California, Essential Housing Revenue Bonds, | 2/30 at 100.00 | N/R | 3,394,076 |
| Serenity at Larkspur Apartments, Series 2020A, 5.000%, 2/01/50, 144A | ||||
| 400 | California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, | 6/30 at 100.00 | A– | 404,180 |
| Los Angeles County Securitization Corporation, Series 2020A, 4.000%, 6/01/40 | ||||
| 10 | California Housing Finance Agency, Municipal Certificate Revenue Bonds, Class A Series | No Opt. Call | BBB+ | 9,630 |
| 2019-2, 4.000%, 3/20/33 | ||||
| 1,310 | California Municipal Finance Authority, Revenue Bonds, Linxs APM Project, Senior Lien | 6/28 at 100.00 | N/R | 1,258,949 |
| Series 2018A, 3.500%, 12/31/35 – AGM Insured, (AMT) | ||||
| California Municipal Finance Authority, Revenue Bonds, NorthBay Healthcare Group, Series 2017A: | ||||
| 1,095 | 5.250%, 11/01/29 | 11/26 at 100.00 | BBB– | 1,184,286 |
| 1,140 | 5.000%, 11/01/30 | 11/26 at 100.00 | BBB– | 1,217,372 |
| 1,000 | California Pollution Control Financing Authority, Water Furnishing Revenue Bonds, Poseidon | 1/23 at 100.00 | BBB | 1,003,820 |
| Resources Channelside LP Desalination Project, Series 2012, 5.000%, 11/21/45, (AMT), 144A | ||||
| California Statewide Communities Development Authority, California, Revenue Bonds, Loma | ||||
| Linda University Medical Center, Series 2014A: | ||||
| 500 | 5.250%, 12/01/29 | 12/24 at 100.00 | BB | 517,635 |
| 2,500 | 5.250%, 12/01/34 | 12/24 at 100.00 | BB | 2,576,475 |
| 2,500 | 5.250%, 12/01/44 | 12/24 at 100.00 | BB | 2,562,975 |
| 1,713 | 5.500%, 12/01/54 | 12/24 at 100.00 | BB | 1,762,523 |
| 2,300 | California Statewide Communities Development Authority, California, Revenue Bonds, Loma | 6/26 at 100.00 | BB | 2,393,771 |
| Linda University Medical Center, Series 2016A, 5.000%, 12/01/27, 144A |
19
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| California (continued) | ||||
| $ 2,765 | California Statewide Community Development Authority, Certificates of Participation, | 1/28 at 100.00 | BBB+ | $ 2,799,037 |
| Methodist Hospital of Southern California, Series 2018, 4.250%, 1/01/43 | ||||
| 3,000 | Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Bonds, | No Opt. Call | AA | 3,160,500 |
| Refunding Series 2013A, 0.000%, 1/15/29 – AGM Insured (6) | ||||
| Golden State Tobacco Securitization Corporation, California, Tobacco Settlement | ||||
| Asset-Backed Bonds, Series 2018A-1: | ||||
| 2,000 | 5.000%, 6/01/30, (Pre-refunded 6/01/28) | 6/28 at 100.00 | BBB (4) | 2,322,120 |
| 3,260 | 5.000%, 6/01/32, (Pre-refunded 6/01/28) | 6/28 at 100.00 | BBB (4) | 3,785,056 |
| 5,290 | 5.000%, 6/01/33, (Pre-refunded 6/01/28) | 6/28 at 100.00 | BBB (4) | 6,142,007 |
| 3,805 | 5.000%, 6/01/34, (Pre-refunded 6/01/28) | 6/28 at 100.00 | BBB– (4) | 4,417,833 |
| 1,415 | 5.000%, 6/01/35, (Pre-refunded 6/01/28) | 6/28 at 100.00 | BB+ (4) | 1,642,900 |
| 100 | Indio Redevelopment Agency, California, Tax Allocation Bonds, Merged Area Redevelopment | 7/22 at 100.00 | A | 100,301 |
| Project, Subordinate Lien Refunding Series 2008A, 5.000%, 8/15/23 | ||||
| 2,315 | Lake Elsinore Public Financing Authority, California, Local Agency Revenue Bonds, | 9/25 at 100.00 | N/R | 2,420,170 |
| Refunding Series 2015, 5.000%, 9/01/35 | ||||
| 4,100 | Natomas Unified School District, Sacramento County, California, General Obligation | 8/26 at 100.00 | AA | 3,519,399 |
| Bonds, Election 2018, Series 2019, 3.000%, 8/01/46 – AGM Insured, (UB) (5) | ||||
| 700 | Redwood City, California, Special Tax Refunding Bonds, Redwood Shores Community | 9/22 at 100.00 | N/R | 703,423 |
| Facilities District 99-1, Shores Transportation Improvement Project, Series 2012B, | ||||
| 5.000%, 9/01/29 | ||||
| 1,975 | Riverside County Redevelopment Agency Successor Agency, California, Tax Allocation | 10/24 at 100.00 | AA | 2,085,659 |
| Bonds, Refunding Series 2014A, 5.000%, 10/01/34 – AGM Insured | ||||
| 4,000 | Riverside County Transportation Commission, California, Toll Revenue Second Lien Bonds, | 6/31 at 100.00 | N/R | 3,984,800 |
| RCTC 91 Express Lanes, Refunding Series 2021C, 4.000%, 6/01/47 | ||||
| 500 | Roseville, California, Special Tax Bonds, Community Facilities District 1 Westbrook, | 9/24 at 100.00 | N/R | 519,340 |
| Series 2014, 5.000%, 9/01/29 | ||||
| 2,395 | San Bernardino Joint Powers Financing Authority, California, Tax Allocation Bonds, | No Opt. Call | AA | 2,587,295 |
| Series 2005A, 5.750%, 10/01/24 – AGM Insured | ||||
| 1,500 | Tejon Ranch Public Facilities Financing Authority, California, Special Tax Bonds, | 3/23 at 100.00 | N/R | 1,517,850 |
| Community Facilities District 2008-1 Tejon Industrial Complex East 2012A, 5.000%, 9/01/32 | ||||
| 1,500 | Tejon Ranch Public Facilities Financing Authority, California, Special Tax Bonds, | 3/23 at 100.00 | N/R | 1,517,730 |
| Community Facilities District 2008-1 Tejon Industrial Complex East 2012B, 5.000%, 9/01/32 | ||||
| 63,868 | Total California | 68,395,395 | ||
| Colorado – 3.1% (2.4% of Total Investments) | ||||
| Colorado Bridge Enterprise, Revenue Bonds, Central 70 Project, Senior Series 2017: | ||||
| 750 | 4.000%, 12/31/30, (AMT) | 12/27 at 100.00 | A– | 785,430 |
| 250 | 4.000%, 6/30/31, (AMT) | 12/27 at 100.00 | A– | 261,480 |
| 645 | Colorado Educational and Cultural Facilities Authority, Charter School Refunding Revenue | 6/23 at 100.00 | A+ | 659,029 |
| Bonds, Pinnacle Charter School, Inc. K-8 Facility Project, Series 2013, 5.000%, 6/01/29 | ||||
| 25 | Colorado Educational and Cultural Facilities Authority, Charter School Revenue Bonds, | No Opt. Call | BB+ | 25,194 |
| Littleton Preparatory Charter School, Series 2013, 5.000%, 12/01/22 | ||||
| 3,270 | Colorado Springs, Colorado, Utilities System Revenue Bonds, Tender Option Bond Trust | 11/22 at 100.00 | AA+ | 3,365,517 |
| 2015-XF0223, 12.162%, 11/15/30, 144A, (IF) (5) | ||||
| Colorado State Board of Governors, Colorado State University Auxiliary Enterprise System | ||||
| Revenue Bonds, Tender Option Bond Trust 2016-XF2354: | ||||
| 100 | 20.029%, 3/01/25, 144A, (IF) (5) | No Opt. Call | AA | 138,460 |
| 300 | 20.029%, 3/01/26, 144A, (IF) (5) | No Opt. Call | AA | 446,085 |
| 430 | 19.985%, 3/01/27, 144A, (IF) (5) | No Opt. Call | AA | 681,219 |
| 725 | 20.029%, 3/01/28, 144A, (IF) (5) | No Opt. Call | AA | 1,211,968 |
| 200 | 20.029%, 3/01/29, 144A, (IF) (5) | No Opt. Call | AA | 350,536 |
| 2,000 | Denver Convention Center Hotel Authority, Colorado, Revenue Bonds, Convention Center | No Opt. Call | Baa2 | 2,163,640 |
| Hotel, Refunding Senior Lien Series 2016, 5.000%, 12/01/26 | ||||
| 3,150 | Westminster Economic Development Authority, Colorado, Tax Increment Revenue Bonds, | 12/22 at 100.00 | AA– | 3,204,337 |
| Mandalay Gardens Urban Renewal Project, Series 2012, 5.000%, 12/01/27 |
20
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Colorado (continued) | ||||
| Windler Public Improvement Authority, Aurora, Colorado, Limited Tax Supported Revenue | ||||
| Bonds, Convertible Capital Appreciation Series 2021A-2: | ||||
| $ 1,500 | 0.000%, 12/01/31, 144A (6) | 9/26 at 97.87 | N/R | $ 1,051,290 |
| 7,370 | 0.000%, 12/01/36, 144A (6) | 9/26 at 97.58 | N/R | 4,880,930 |
| 1,130 | 0.000%, 12/01/41, 144A (6) | 9/26 at 97.43 | N/R | 715,629 |
| 21,845 | Total Colorado | 19,940,744 | ||
| Connecticut – 0.1% (0.1% of Total Investments) | ||||
| 900 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Stamford | 7/22 at 100.00 | BBB+ | 902,727 |
| Hospital, Series 2012J, 5.000%, 7/01/37 | ||||
| District of Columbia – 1.3% (1.0% of Total Investments) | ||||
| District of Columbia, Tax Increment Revenue Bonds, Gallery Place Project, Tender Option | ||||
| Bond Trust 2016-XF2341: | ||||
| 745 | 18.891%, 6/01/29, 144A, (IF) (5) | 6/21 at 100.00 | AA+ | 752,681 |
| 785 | 18.824%, 6/01/30, 144A, (IF) (5) | 6/21 at 100.00 | AA+ | 792,866 |
| 520 | 18.891%, 6/01/31, 144A, (IF) (5) | 6/21 at 100.00 | AA+ | 525,127 |
| 800 | District of Columbia, Washington, D.C., Revenue Bonds, District of Columbia | 7/29 at 100.00 | BBB | 830,464 |
| International School, Series 2019, 5.000%, 7/01/39 | ||||
| 300 | District of Columbia, Washington, D.C., Revenue Bonds, Ingleside at Rock Creek Project, | 7/24 at 103.00 | N/R | 300,477 |
| Series 2017A, 4.125%, 7/01/27 | ||||
| 5,000 | Metropolitan Washington D.C. Airports Authority, Airport System Revenue Bonds, Refunding | 10/31 at 100.00 | Aa3 | 5,002,150 |
| Series 2021A, 4.000%, 10/01/51, (AMT) | ||||
| 8,150 | Total District of Columbia | 8,203,765 | ||
| Florida – 10.3% (8.1% of Total Investments) | ||||
| 150 | Atlantic Beach, Florida, Healthcare Facilities Revenue Refunding Bonds, Fleet Landing | No Opt. Call | BBB | 154,751 |
| Project, Series 2013A, 5.000%, 11/15/23 | ||||
| 470 | Ave Maria Stewardship Community District, Florida, Capital Improvement Revenue Bonds, | 5/25 at 100.00 | N/R | 475,588 |
| 2015 Assessment Project, Series 2015, 5.000%, 5/01/30 | ||||
| 7,200 | Cape Coral Health Facilities Authority, Florida, Senior Housing Revenue Bonds, Gulf Care | 7/25 at 100.00 | N/R | 7,300,800 |
| Inc. Project, Series 2015, 5.750%, 7/01/30, 144A | ||||
| 1,570 | Capital Trust Agency, Florida, Fixed Rate Air Cargo Revenue Refunding Bonds, Aero Miami | 7/22 at 100.00 | Baa3 | 1,572,418 |
| FX, LLC Project, Series 2010A, 5.350%, 7/01/29 | ||||
| 175 | Collier County Educational Facilities Authority, Florida, Revenue Bonds, Ave Maria | No Opt. Call | BBB– | 176,694 |
| University, Refunding Series 2013A, 4.500%, 6/01/23 | ||||
| 2,500 | Escambia County Health Facilities Authority, Florida, Health Care Facilities Revenue | 2/30 at 100.00 | BBB+ | 2,417,275 |
| Bonds, Baptist Health Care Corporation Obligated, Series 2020A, 4.000%, 8/15/45 | ||||
| 5,675 | Escambia County Health Facilities Authority, Florida, Health Care Facilities Revenue | 2/30 at 100.00 | BBB+ | 5,487,214 |
| Bonds, Baptist Health Care Corporation Obligated, Series 2020A, 4.000%, 8/15/45, (UB) (5) | ||||
| 7,500 | Florida Development Finance Corporation, Florida, Surface Transportation Facility Revenue | 1/24 at 107.00 | N/R | 7,589,175 |
| Bonds, Brightline Passenger Rail Project, Green Series 2019B, 7.375%, 1/01/49, (AMT), 144A | ||||
| 7,865 | Florida Development Finance Corporation, Florida, Surface Transportation Facility | 7/22 at 102.00 | N/R | 7,805,226 |
| Revenue Bonds, Virgin Trains USA Passenger Rail Project, Series 2019A, 6.250%, 1/01/49, | ||||
| (AMT), (Mandatory Put 1/01/24), 144A | ||||
| 1,795 | Florida Development Finance Corporation, Revenue Bonds, Brightline Passenger Rail | 7/22 at 102.50 | N/R | 1,785,020 |
| Expansion Project, Series 2021A-1, 6.750%, 12/01/56, (AMT), (Mandatory Put 8/15/23), 144A | ||||
| 175 | Grand Bay at Doral Community Development District, Miami-Dade County, Florida, Special | No Opt. Call | N/R | 176,372 |
| Assessment Bonds, Doral Breeze Project Series 2012, 5.125%, 11/01/22 | ||||
| Lake Powell Residential Golf Community Development District, Bay County, FLorida, | ||||
| Special Assessment Revenue Refunding Bonds, Series 2012: | ||||
| 175 | 5.250%, 11/01/22 | No Opt. Call | N/R | 176,417 |
| 1,210 | 5.750%, 11/01/32 | 11/23 at 100.00 | N/R | 1,229,941 |
| 1,190 | Lee County Industrial Development Authority, Florida, Charter School Revenue Bonds, Lee | 7/22 at 100.00 | BB– | 1,191,071 |
| County Community Charter Schools, Series 2007A, 5.250%, 6/15/27 |
21
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Florida (continued) | ||||
| Miami-Dade County Expressway Authority, Florida, Toll System Revenue Bonds, Tender | ||||
| Option Bond Trust 2016-XG0099: | ||||
| $ 700 | 18.448%, 7/01/22, 144A, (IF) (5) | No Opt. Call | A | $ 709,548 |
| 820 | 18.448%, 7/01/23, 144A, (IF) (5) | 7/22 at 100.00 | A | 832,193 |
| 1,115 | 18.448%, 7/01/24, 144A, (IF) (5) | 7/22 at 100.00 | A | 1,130,989 |
| 800 | 18.448%, 7/01/25, 144A, (IF) (5) | 7/22 at 100.00 | A | 811,472 |
| 330 | Northern Palm Beach County Improvement District, Florida, Water Control and Improvement | No Opt. Call | N/R (4) | 332,102 |
| Bonds, Development Unit 16, Refunding Series 2012, 5.125%, 8/01/22, (ETM) | ||||
| Osceola County, Florida, Transportation Revenue Bonds, Osceola Parkway, Refunding & | ||||
| Improvement Capital Appreciation Series 2019A-2: | ||||
| 1,500 | 0.000%, 10/01/40 | 10/29 at 68.72 | BBB+ | 686,205 |
| 2,000 | 0.000%, 10/01/41 | 10/29 at 66.18 | BBB+ | 872,000 |
| 2,000 | 0.000%, 10/01/42 | 10/29 at 63.69 | BBB+ | 829,500 |
| 1,000 | 0.000%, 10/01/44 | 10/29 at 59.08 | BBB+ | 374,150 |
| 4,000 | 0.000%, 10/01/45 | 10/29 at 56.95 | BBB+ | 1,422,600 |
| 500 | Palm Beach County Health Facilities Authority, Florida, Hospital Revenue Bonds, BRCH | 12/24 at 100.00 | N/R (4) | 536,560 |
| Corporation Obligated Group, Refunding Series 2014, 5.000%, 12/01/25, (Pre-refunded 12/01/24) | ||||
| 900 | Palm Beach County Health Facilities Authority, Florida, Revenue Bonds, Jupiter Medical | 11/22 at 100.00 | BBB+ | 905,175 |
| Center, Series 2013A, 5.000%, 11/01/33 | ||||
| 365 | Palm Beach County, Florida, Revenue Bonds, Provident Group – PBAU Properties LLC – Palm | 4/29 at 100.00 | Ba1 | 367,070 |
| Beach Atlantic University Housing Project, Series 2019A, 5.000%, 4/01/39, 144A | ||||
| 1,000 | Pine Island Community Development District, Florida, Special Assessment Bonds, Bella | 7/22 at 100.00 | N/R | 1,002,860 |
| Collina, Series 2004, 5.750%, 5/01/35 | ||||
| 2,325 | Saint Johns County Industrial Development Authority, Florida, First Mortgage Revenue Bonds, | 8/25 at 103.00 | A– | 2,387,984 |
| Presbyterian Retirement Communities Obligated Group Project, Series 2020A, 4.000%, 8/01/55 | ||||
| 2,610 | South Fork Community Development District, Florida, Capital Improvement Revenue Bonds, | 5/27 at 100.00 | BBB | 2,649,515 |
| Refunding Series 2017, 4.000%, 5/01/31 | ||||
| 505 | Stonegate Community Development District, Florida, Special Assessment Revenue Bonds, | 5/23 at 100.00 | N/R | 506,470 |
| Refunding Series 2013, 4.000%, 5/01/25 | ||||
| Sumter County Industrial Development Authority, Florida, Hospital Revenue Bonds, Central | ||||
| Florida Health Alliance Projects, Series 2014B: | ||||
| 2,925 | 5.000%, 7/01/29 | 7/24 at 100.00 | A– | 3,040,333 |
| 2,350 | 5.000%, 7/01/30 | 7/24 at 100.00 | A– | 2,434,671 |
| 1,560 | 5.000%, 7/01/31 | 7/24 at 100.00 | A– | 1,612,946 |
| 1,400 | 5.000%, 7/01/32 | 7/24 at 100.00 | A– | 1,443,694 |
| Tampa-Hillsborough County Expressway Authority, Florida, Revenue Bonds, Tender Option | ||||
| Bond Trust 2016-XG0097: | ||||
| 400 | 19.341%, 7/01/27, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 406,232 |
| 290 | 19.341%, 7/01/28, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 294,518 |
| 1,000 | 14.390%, 7/01/29, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 1,011,570 |
| 1,000 | 14.390%, 7/01/30, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 1,011,570 |
| 1,000 | 19.341%, 7/01/31, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 1,015,580 |
| 355 | Verandah West Community Development District, Florida, Capital Improvement Revenue | No Opt. Call | N/R | 356,317 |
| Bonds, Refunding Series 2013, 4.000%, 5/01/23 | ||||
| 72,400 | Total Florida | 66,521,786 | ||
| Georgia – 0.4% (0.3% of Total Investments) | ||||
| 650 | Atlanta Development Authority, Georgia, Senior Health Care Facilities Revenue Bonds, | 1/28 at 100.00 | N/R | 344,500 |
| Georgia Proton Treatment Center Project, Current Interest Series 2017A-1, 6.500%, 1/01/29 (7) | ||||
| 1,250 | Geo. L. Smith II Georgia World Congress Center Authority, Georgia, Convention Center | 1/31 at 100.00 | BBB– | 1,137,925 |
| Hotel Revenue Bonds, First Tier Series 2021A, 4.000%, 1/01/54 | ||||
| 1,105 | Georgia Housing and Finance Authority, Single Family Mortgage Bonds, Series 2018A, | 6/27 at 100.00 | AAA | 1,112,260 |
| 4.000%, 12/01/48 | ||||
| 3,005 | Total Georgia | 2,594,685 |
22
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Guam – 3.0% (2.4% of Total Investments) | ||||
| Government of Guam, Business Privilege Tax Bonds, Refunding Series 2015D: | ||||
| $ 1,860 | 5.000%, 11/15/24 | No Opt. Call | BB | $ 1,969,498 |
| 2,170 | 5.000%, 11/15/33 | 11/25 at 100.00 | BB | 2,300,699 |
| Guam A.B. Won Pat International Airport Authority, Revenue Bonds, Series 2013C: | ||||
| 605 | 6.250%, 10/01/34, (AMT) | 10/23 at 100.00 | Baa2 | 630,440 |
| 395 | 6.250%, 10/01/34, (Pre-refunded 10/01/23), (AMT) | 10/23 at 100.00 | Baa2 (4) | 417,468 |
| 1,100 | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, | 7/24 at 100.00 | A– | 1,149,258 |
| Refunding Series 2014A, 5.000%, 7/01/29 | ||||
| Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, Series 2013: | ||||
| 1,365 | 5.250%, 7/01/24 | 7/23 at 100.00 | A– | 1,406,400 |
| 2,500 | 5.500%, 7/01/43, (Pre-refunded 7/01/23) | 7/23 at 100.00 | A– (4) | 2,599,175 |
| Guam Government, Limited Obligation Section 30 Revenue Bonds, Series 2016A: | ||||
| 2,500 | 5.000%, 12/01/25 | No Opt. Call | BB | 2,695,075 |
| 3,750 | 5.000%, 12/01/26 | No Opt. Call | BB | 4,101,375 |
| 2,025 | Guam Power Authority, Revenue Bonds, Series 2012A, 5.000%, 10/01/30 – AGM Insured | 10/22 at 100.00 | AA | 2,048,470 |
| 200 | Guam Power Authority, Revenue Bonds, Series 2014A, 5.000%, 10/01/31 | 10/24 at 100.00 | BBB | 207,576 |
| 18,470 | Total Guam | 19,525,434 | ||
| Hawaii – 1.0% (0.8% of Total Investments) | ||||
| 6,125 | Hawaii Department of Budget and Finance, Special Purpose Revenue Bonds, Hawaii Pacific | 7/27 at 100.00 | N/R | 6,269,672 |
| University, Series 2018, 6.000%, 7/01/28, 144A | ||||
| Idaho – 0.4% (0.3% of Total Investments) | ||||
| 2,530 | Idaho Health Facilities Authority, Revenue Bonds, Madison Memorial Hospital Project, | 9/26 at 100.00 | BB+ | 2,698,599 |
| Refunding Series 2016, 5.000%, 9/01/30 | ||||
| Illinois – 14.6% (11.5% of Total Investments) | ||||
| 1,860 | CenterPoint Intermodal Center Program Trust, Illinois, Series 2004 Class A Certificates, | No Opt. Call | N/R | 1,860,372 |
| 4.000%, 6/15/23, (Mandatory Put 12/15/22), 144A | ||||
| 5,000 | Chicago Board of Education, Illinois, Dedicated Capital Improvement Tax Revenue Bonds, | 4/27 at 100.00 | A– | 5,348,050 |
| Series 2016, 5.750%, 4/01/34 | ||||
| 440 | Chicago Board of Education, Illinois, Dedicated Capital Improvement Tax Revenue Bonds, | 4/27 at 100.00 | A– | 450,503 |
| Series 2017, 5.000%, 4/01/42 | ||||
| Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | ||||
| Project Series 2015C: | ||||
| 470 | 5.250%, 12/01/35 | 12/24 at 100.00 | BB | 480,218 |
| 555 | 5.250%, 12/01/39 | 12/24 at 100.00 | BB | 571,261 |
| 3,405 | Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | 12/22 at 100.00 | BB | 3,413,410 |
| Refunding Series 2012B, 5.000%, 12/01/33 | ||||
| Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | ||||
| Refunding Series 2017C: | ||||
| 7,225 | 5.000%, 12/01/26 | No Opt. Call | BB | 7,643,327 |
| 1,875 | 5.000%, 12/01/27 | No Opt. Call | BB | 1,995,975 |
| 1,000 | Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | 12/27 at 100.00 | BB | 1,046,060 |
| Refunding Series 2017G, 5.000%, 12/01/34 | ||||
| 1,000 | Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | 12/28 at 100.00 | AA | 1,113,060 |
| Refunding Series 2018A, 5.000%, 12/01/30 – AGM Insured | ||||
| 2,115 | Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | No Opt. Call | BB | 2,170,011 |
| Refunding Series 2018C, 5.000%, 12/01/23 | ||||
| 1,000 | Chicago Board of Education, Illinois, General Obligation Bonds, Dedicated Revenues, | 12/25 at 100.00 | BB | 1,117,260 |
| Series 2016A, 7.000%, 12/01/26 | ||||
| Chicago Board of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated | ||||
| Tax Revenues, Series 1998B-1: | ||||
| 1,470 | 0.000%, 12/01/22 – FGIC Insured | No Opt. Call | Baa2 | 1,452,066 |
| 1,500 | 0.000%, 12/01/27 – NPFG Insured | No Opt. Call | Baa2 | 1,227,615 |
23
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Illinois (continued) | ||||
| $ 1,795 | Chicago, Illinois, Certificates of Participation Tax Increment Bonds, 35th and State | 6/22 at 100.00 | N/R | $ 1,795,107 |
| Redevelopment Project, Series 2012, 6.100%, 1/15/29 | ||||
| 655 | Chicago, Illinois, Certificates of Participation, Tax Increment Allocation Revenue | 7/22 at 100.00 | N/R | 613,912 |
| Bonds, Diversey-Narragansett Project, Series 2006, 7.460%, 2/15/26 (7) | ||||
| 2,630 | Chicago, Illinois, General Obligation Bonds, City Colleges, Series 1999, 1.000%, 1/01/34 | No Opt. Call | BBB+ | 1,621,763 |
| - FGIC Insured | ||||
| 225 | Chicago, Illinois, General Obligation Bonds, Project and Refunding Series 2008C, | No Opt. Call | BBB+ | 172,098 |
| 0.000%, 1/01/29 | ||||
| Chicago, Illinois, General Obligation Bonds, Refunding Series 2016C: | ||||
| 850 | 5.000%, 1/01/24 | No Opt. Call | BBB+ | 873,435 |
| 1,500 | 5.000%, 1/01/25 | No Opt. Call | BBB+ | 1,560,135 |
| 515 | 5.000%, 1/01/31 | 1/26 at 100.00 | BBB+ | 535,610 |
| 1,685 | 5.000%, 1/01/38 | 1/26 at 100.00 | BBB+ | 1,744,902 |
| 2,000 | Chicago, Illinois, General Obligation Bonds, Series 2019A, 5.500%, 1/01/49 | 1/29 at 100.00 | BBB+ | 2,140,320 |
| 2,640 | Chicago, Illinois, General Obligation Bonds, Series 2021A, 5.000%, 1/01/24 | No Opt. Call | N/R | 2,712,785 |
| Cook County, Illinois, General Obligation Bonds, Tender Option Bond Trust 2015-XF0124: | ||||
| 1,000 | 18.845%, 11/15/29, 144A, (IF) (5) | 11/22 at 100.00 | A+ | 1,067,000 |
| 3,040 | 18.845%, 11/15/33, 144A, (IF) (5) | 11/22 at 100.00 | A+ | 3,234,682 |
| 435 | Illinois Finance Authority, Revenue Bonds, Centegra Health System, Tender Option Bond | No Opt. Call | AA+ | 454,810 |
| Trust 2016-XF2339, 19.432%, 9/01/22, 144A, (IF) (5) | ||||
| Illinois Finance Authority, Revenue Bonds, Illinois Wesleyan University, Refunding | ||||
| Series 2016: | ||||
| 1,500 | 3.000%, 9/01/30 | 9/26 at 100.00 | A– | 1,467,270 |
| 1,475 | 3.000%, 9/01/31 | 9/26 at 100.00 | A– | 1,433,847 |
| 775 | Illinois Finance Authority, Student Housing & Academic Facility Revenue Bonds, | 8/27 at 100.00 | Baa3 | 790,221 |
| CHF-Collegiate Housing Foundation – Chicago LLC University of Illinois at Chicago Project, | ||||
| Series 2017A, 5.000%, 2/15/37 | ||||
| 2,500 | Illinois Sports Facility Authority, State Tax Supported Bonds, Refunding Series 2014, | 6/24 at 100.00 | AA | 2,619,100 |
| 5.000%, 6/15/27 – AGM Insured | ||||
| 1,000 | Illinois Sports Facility Authority, State Tax Supported Bonds, Series 2001, 0.000%, | No Opt. Call | BB+ | 911,020 |
| 6/15/25 – AMBAC Insured | ||||
| Illinois State, General Obligation Bonds, December Series 2017A: | ||||
| 890 | 5.000%, 12/01/27 | No Opt. Call | BBB | 974,239 |
| 1,020 | 5.000%, 12/01/28 | 12/27 at 100.00 | BBB | 1,108,046 |
| 1,875 | Illinois State, General Obligation Bonds, June Series 2016, 3.500%, 6/01/29 | 6/26 at 100.00 | BBB | 1,883,644 |
| 1,500 | Illinois State, General Obligation Bonds, November Series 2016, 5.000%, 11/01/26 | No Opt. Call | BBB | 1,629,675 |
| 5,175 | Illinois State, General Obligation Bonds, November Series 2017D, 5.000%, 11/01/27 | No Opt. Call | BBB | 5,664,141 |
| 3,050 | Illinois State, General Obligation Bonds, November Series 2019B, 4.000%, 11/01/34 | 11/29 at 100.00 | BBB | 2,976,099 |
| 4,565 | Illinois State, General Obligation Bonds, October Series 2016, 5.000%, 2/01/26 | No Opt. Call | BBB | 4,912,716 |
| Illinois State, General Obligation Bonds, Refunding Series 2012: | ||||
| 1,750 | 5.000%, 8/01/22 | No Opt. Call | BBB | 1,760,028 |
| 4,000 | 5.000%, 8/01/23 – AGM Insured | No Opt. Call | AA | 4,134,760 |
| 2,000 | Illinois State, General Obligation Bonds, Tender Option Bond Trust 2015-XF1010, 15.502%, | No Opt. Call | AA | 2,269,560 |
| 8/01/23 – AGM Insured, 144A, (IF) (5) | ||||
| 3,560 | Illinois State, Sales Tax Revenue Bonds, Build Illinois, Refunding Junior Obligation | 6/26 at 100.00 | AA | 3,677,551 |
| September Series 2016C, 4.000%, 6/15/30 – BAM Insured | ||||
| 1,000 | Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project | No Opt. Call | BBB+ | 1,080,210 |
| Bonds, Series 2017B, 5.000%, 12/15/26 | ||||
| 2,250 | Romeoville, Will County, Illinois, Revenue Bonds, Lewis University Project, Refunding | 4/25 at 100.00 | BBB | 2,244,487 |
| Series 2018B, 4.125%, 10/01/46 | ||||
| Romeoville, Will County, Illinois, Revenue Bonds, Lewis University Project, Series 2015: | ||||
| 1,100 | 5.000%, 10/01/25 | 4/25 at 100.00 | BBB | 1,161,083 |
| 200 | 5.000%, 10/01/26 | 4/25 at 100.00 | BBB | 210,442 |
24
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Illinois (continued) | ||||
| $ 435 | Southwestern Illinois Development Authority, Environmental Improvement Revenue Bonds, US | 8/22 at 100.00 | B | $ 435,296 |
| Steel Corporation Project, Series 2012, 5.750%, 8/01/42, (AMT) | ||||
| 2,500 | Wauconda, Illinois, Special Service Area 1 Special Tax Bonds, Liberty Lake Project, | 3/25 at 100.00 | AA | 2,631,300 |
| Refunding Series 2015, 5.000%, 3/01/33 – BAM Insured | ||||
| 92,005 | Total Illinois | 94,390,482 | ||
| Indiana – 1.1% (0.9% of Total Investments) | ||||
| 145 | Gary Local Public Improvement Bond Bank, Indiana, Economic Development Revenue Bonds, | 6/30 at 100.00 | N/R | 141,023 |
| Drexel Foundation for Educational Excellence Project, Refunding Series 2020A, 5.125%, | ||||
| 6/01/32, 144A | ||||
| 3,420 | Indiana Finance Authority, Educational Facilities Revenue Bonds, 21st Century Charter | 3/23 at 100.00 | B+ | 3,422,565 |
| School Project, Series 2013A, 6.000%, 3/01/33 | ||||
| 85 | Indiana Finance Authority, Educational Facilities Revenue Bonds, Circle City Preparatory | 12/27 at 103.00 | N/R | 84,593 |
| Inc. Project, Series 2021A, 5.000%, 12/01/30 | ||||
| 475 | Indiana Finance Authority, Educational Facilities Revenue Bonds, Lighthouse Academies of | No Opt. Call | N/R | 490,347 |
| Northwest Indiana Inc. Project, Series 2016, 6.250%, 12/01/24, 144A | ||||
| 1,420 | Indiana Finance Authority, Environmental Improvement Revenue Bonds, United States Steel | 8/22 at 100.00 | B | 1,420,966 |
| Corporation Project, Series 2012, 5.750%, 8/01/42, (AMT) | ||||
| 1,295 | Indiana Finance Authority, Health Facilities Revenue Bonds, Good Samaritan Hospital | No Opt. Call | Baa3 | 1,366,341 |
| Project, Series 2016A, 5.500%, 4/01/24 | ||||
| 100 | Valparaiso, Indiana, Exempt Facilities Revenue Bonds, Pratt Paper LLC Project, Series | No Opt. Call | N/R | 102,637 |
| 2013, 5.875%, 1/01/24, (AMT) | ||||
| 6,940 | Total Indiana | 7,028,472 | ||
| Iowa – 0.5% (0.4% of Total Investments) | ||||
| 1,925 | Iowa Finance Authority, Iowa, Midwestern Disaster Area Revenue Bonds, Alcoa Inc. | 8/22 at 100.00 | BBB– | 1,925,424 |
| Project, Series 2012, 4.750%, 8/01/42 | ||||
| 8,375 | Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed Bonds, Class 2 | 6/31 at 25.58 | N/R | 1,161,361 |
| Capital Appreciation Senior Lien Series 2021B-2, 0.000%, 6/01/65 | ||||
| 10,300 | Total Iowa | 3,086,785 | ||
| Kansas – 0.9% (0.8% of Total Investments) | ||||
| 310 | Kansas Development Finance Authority Hospital Revenue Bonds, Adventist Health | 5/22 at 100.00 | AA | 313,255 |
| System/Sunbelt Obligated Group, Tender Option Bond Trust 2016-XG0056, 15.956%, 11/15/32, | ||||
| 144A, (IF) (5) | ||||
| 200 | Kansas Power Pool, a Municipal Energy Agency Electric Utility Revenue Bonds, DogWood | 12/25 at 100.00 | A3 | 212,916 |
| Facility, Series 2015A, 5.000%, 12/01/28 | ||||
| 2,000 | Overland Park, Kansas, Sales Tax Revenue Bonds, Prairiefire Community Improvement | 12/22 at 100.00 | N/R | 1,000,000 |
| District No. 1 Project, Series 2012B, 0.000%, 12/15/34 (7) | ||||
| 8,000 | Overland Park, Kansas, Sales Tax Special Obligation Revenue Bonds, Prairiefire at | 12/22 at 100.00 | N/R | 4,651,040 |
| Lionsgate Project, Series 2012, 5.250%, 12/15/29 | ||||
| 10,510 | Total Kansas | 6,177,211 | ||
| Kentucky – 1.0% (0.8% of Total Investments) | ||||
| Ashland, Kentucky, Medical Center Revenue Bonds, Ashland Hospital Corporation d/b/a | ||||
| King’s Daughters Medical Center Project, Refunding Series 2019: | ||||
| 920 | 5.000%, 2/01/31 | 2/30 at 100.00 | BBB+ | 1,020,078 |
| 125 | 4.000%, 2/01/33 | 2/30 at 100.00 | BBB+ | 127,057 |
| Kentucky Economic Development Finance Authority, Hospital Revenue Bonds, Owensboro | ||||
| Health, Refunding Series 2017A: | ||||
| 3,000 | 5.000%, 6/01/30 | 6/27 at 100.00 | Baa2 | 3,234,540 |
| 1,315 | 5.000%, 6/01/31 | 6/27 at 100.00 | Baa2 | 1,411,298 |
| 685 | Kentucky Economic Development Finance Authority, Revenue Bonds, Next Generation Kentucky | 7/25 at 100.00 | BBB+ | 719,099 |
| Information Highway Project, Senior Series 2015A, 5.000%, 7/01/33 | ||||
| 6,045 | Total Kentucky | 6,512,072 |
25
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Louisiana – 1.7% (1.3% of Total Investments) | ||||
| $ 3,300 | Louisiana Local Government Environmental Facilities and Community Development Authority, | 11/27 at 100.00 | BBB | $ 3,240,468 |
| Revenue Bonds, Westlake Chemical Corporation Projects, Refunding Series 2017, 3.500%, 11/01/32 | ||||
| 1,500 | Louisiana Public Facilities Authority, Louisiana, Revenue Bonds, Ochsner Clinic Foundation | 5/30 at 100.00 | A | 1,480,875 |
| Project, Series 2020A, 4.000%, 5/15/49 | ||||
| 2,840 | Louisiana Public Facilities Authority, Revenue Bonds, Loyola University Project, | No Opt. Call | Baa1 | 2,752,557 |
| Refunding Series 2017, 0.000%, 10/01/31 (6) | ||||
| 1,000 | Louisiana Stadium and Exposition District, Revenue Refunding Bonds, Senior Lien Series | No Opt. Call | A2 | 1,002,880 |
| 2013A, 5.000%, 7/01/22 | ||||
| New Orleans Aviation Board, Louisiana, General Airport Revenue Bonds, North Terminal | ||||
| Project, Series 2017B: | ||||
| 500 | 5.000%, 1/01/31, (AMT) | 1/27 at 100.00 | A2 | 535,365 |
| 800 | 5.000%, 1/01/32, (AMT) | 1/27 at 100.00 | A2 | 853,344 |
| 720 | Saint John the Baptist Parish, Louisiana, Revenue Bonds, Marathon Oil Corporation | No Opt. Call | BBB– | 713,484 |
| Project, Refunding Series 2017A-1, 2.000%, 6/01/37, (Mandatory Put 4/01/23) | ||||
| 285 | Saint Tammany Public Trust Financing Authority, Louisiana, Revenue Bonds, Christwood | 11/24 at 100.00 | N/R | 293,641 |
| Project, Refunding Series 2015, 5.250%, 11/15/29 | ||||
| 10,945 | Total Louisiana | 10,872,614 | ||
| Maine – 0.1% (0.1% of Total Investments) | ||||
| 500 | Maine Finance Authority, Solid Waste Disposal Revenue Bonds, Coastal Resources of Maine | 12/26 at 100.00 | N/R | 56,966 |
| LLC Project, Green Series 2017, 0.000%, 12/15/33, (AMT), 144A (7), (8) | ||||
| 350 | Maine Health and Higher Educational Facilities Authority Revenue Bonds, Eastern Maine | No Opt. Call | BBB (4) | 351,075 |
| Medical Center Obligated Group Issue, Series 2013, 5.000%, 7/01/22, (ETM) | ||||
| 850 | Total Maine | 408,041 | ||
| Maryland – 0.8% (0.6% of Total Investments) | ||||
| 1,000 | Anne Arundel County, Maryland, Special Tax District Revenue Bonds, Villages at Two | 7/24 at 100.00 | N/R | 1,014,490 |
| Rivers Projects, Series 2014, 5.250%, 7/01/44 | ||||
| Baltimore, Maryland, Convention Center Hotel Revenue Bonds, Refunding Series 2017: | ||||
| 350 | 5.000%, 9/01/26 | No Opt. Call | CCC | 353,794 |
| 1,000 | 5.000%, 9/01/33 | 9/27 at 100.00 | CCC | 1,005,480 |
| 2,000 | 5.000%, 9/01/34 | 9/27 at 100.00 | CCC | 2,009,320 |
| 775 | Maryland Economic Development Corporation, Port Facilities Revenue Bonds, CNX Marine | 7/22 at 100.00 | BB– | 777,263 |
| Terminals Inc. Port of Baltimore Facility, Refunding Series 2010, 5.750%, 9/01/25 | ||||
| 5,125 | Total Maryland | 5,160,347 | ||
| Massachusetts – 0.2% (0.2% of Total Investments) | ||||
| 1,000 | Massachusetts Development Finance Agency, Revenue Bonds, Boston Medical Center Issue, | No Opt. Call | BBB | 1,087,370 |
| Series 2016E, 5.000%, 7/01/26 | ||||
| 495 | Massachusetts Educational Financing Authority, Education Loan Revenue Bonds, Issue K, | 7/22 at 100.00 | AA | 496,257 |
| Series 2013, 5.250%, 7/01/29, (AMT) | ||||
| 1,495 | Total Massachusetts | 1,583,627 | ||
| Michigan – 3.5% (2.7% of Total Investments) | ||||
| 325 | Flint Hospital Building Authority, Michigan, Building Authority Revenue Bonds, Hurley | No Opt. Call | BBB– | 329,940 |
| Medical Center, Series 2013A, 5.000%, 7/01/23 | ||||
| Michigan Finance Authority, Local Government Loan Program Revenue Bonds, Detroit Water & | ||||
| Sewerage Department Water Supply System Local Project, Series 2014C-3: | ||||
| 5,000 | 5.000%, 7/01/24 – AGM Insured | No Opt. Call | AA | 5,288,600 |
| 5,000 | 5.000%, 7/01/25 – AGM Insured | 7/24 at 100.00 | AA | 5,289,650 |
| 5,000 | 5.000%, 7/01/26 – AGM Insured | 7/24 at 100.00 | AA | 5,284,400 |
| 1,945 | 5.000%, 7/01/31 – AGM Insured | 7/24 at 100.00 | AA | 2,041,025 |
26
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Michigan (continued) | ||||
| Michigan Finance Authority, Local Government Loan Program Revenue Bonds, Detroit Water & | ||||
| Sewerage Department Water Supply System Local Project, Series 2014C-7: | ||||
| $ 2,000 | 5.000%, 7/01/25 – NPFG Insured | 7/24 at 100.00 | A+ | $ 2,109,160 |
| 2,000 | 5.000%, 7/01/26 – NPFG Insured | 7/24 at 100.00 | A+ | 2,107,080 |
| 21,270 | Total Michigan | 22,449,855 | ||
| Minnesota – 0.1% (0.1% of Total Investments) | ||||
| Minnesota Higher Education Facilities Authority, Revenue Bonds, Minneapolis College of | ||||
| Art and Design, Series 2015-8D: | ||||
| 260 | 4.000%, 5/01/24 | 5/23 at 100.00 | Baa2 | 261,500 |
| 250 | 4.000%, 5/01/26 | 5/23 at 100.00 | Baa2 | 250,900 |
| 510 | Total Minnesota | 512,400 | ||
| Mississippi – 0.3% (0.2% of Total Investments) | ||||
| 1,845 | Mississippi Business Finance Corporation, Gulf Opportunity Zone Industrial Development | 7/22 at 100.00 | BBB– | 1,800,406 |
| Revenue Bonds, Northrop Grumman Ship Systems Inc. Project, Series 2006, 4.550%, 12/01/28 | ||||
| Missouri – 1.2% (1.0% of Total Investments) | ||||
| 1,515 | Boone County, Missouri, Hospital Revenue Bonds, Boone Hospital Center, Refunding Series | No Opt. Call | BBB– | 1,585,538 |
| 2016, 5.000%, 8/01/24 | ||||
| 1,125 | Branson Industrial Development Authority, Missouri, Tax Increment Revenue Bonds, Branson | 11/25 at 100.00 | N/R | 1,094,512 |
| Shoppes Redevelopment Project, Refunding Series 2017A, 4.000%, 11/01/27 | ||||
| 1,830 | Poplar Bluff Regional Transportation Development District, Missouri, Transportation | 12/22 at 100.00 | BBB | 1,833,935 |
| Sales Tax Revenue Bonds, Series 2012, 4.000%, 12/01/36 | ||||
| 465 | Raymore, Missouri, Tax Increment Revenue Bonds, Raymore Galleria Project, Refunding & | 5/23 at 100.00 | N/R | 465,139 |
| Improvement Series 2014A, 5.000%, 5/01/24 | ||||
| Saint Louis County Industrial Development Authority, Missouri, Health Facilities Revenue | ||||
| Bonds, Ranken-Jordan Project, Refunding & Improvement Series 2016: | ||||
| 385 | 5.000%, 11/15/23 | No Opt. Call | N/R | 394,148 |
| 800 | 5.000%, 11/15/25 | No Opt. Call | N/R | 839,488 |
| 1,595 | Saint Louis Land Clearance for Redevelopment Authority, Missouri, Annual Appropriation | 4/27 at 100.00 | A | 1,755,250 |
| Revenue Bonds, Contractual Payments of St. Louis City Scottrade Center Project, Series 2018A, | ||||
| 5.000%, 4/01/38 | ||||
| 7,715 | Total Missouri | 7,968,010 | ||
| Nebraska – 0.3% (0.3% of Total Investments) | ||||
| 1,445 | Central Plains Energy Project, Nebraska, Gas Project 3 Revenue Bonds, Series 2012, | 9/22 at 100.00 | A2 | 1,456,531 |
| 5.000%, 9/01/32 | ||||
| 635 | Douglas County Hospital Authority 2, Nebraska, Hospital Revenue Bonds, Madonna | 5/24 at 100.00 | A– | 663,150 |
| Rehabilitation Hospital Project, Series 2014, 5.000%, 5/15/26 | ||||
| 2,080 | Total Nebraska | 2,119,681 | ||
| Nevada – 0.6% (0.5% of Total Investments) | ||||
| Carson City, Nevada, Hospital Revenue Bonds, Carson Tahoe Regional Healthcare Project, | ||||
| Series 2017A: | ||||
| 320 | 5.000%, 9/01/29 | 9/27 at 100.00 | A– | 349,382 |
| 495 | 5.000%, 9/01/31 | 9/27 at 100.00 | A– | 535,140 |
| 1,630 | Carson City, Nevada, Hospital Revenue Bonds, Carson-Tahoe Regional Healthcare Project, | 9/22 at 100.00 | A– (4) | 1,644,735 |
| Refunding Series 2012, 5.000%, 9/01/27, (Pre-refunded 9/01/22) | ||||
| 1,465 | Las Vegas Redevelopment Agency, Nevada, Tax Increment Revenue Bonds, Refunding Series | 6/26 at 100.00 | BBB+ | 1,558,042 |
| 2016, 5.000%, 6/15/31 | ||||
| 160 | North Las Vegas, Nevada, Local Improvement Bonds, Special Improvement District 65 | 12/27 at 100.00 | N/R | 167,075 |
| Northern Beltway Commercial Area, Series 2017, 5.000%, 12/01/37, 144A | ||||
| 4,070 | Total Nevada | 4,254,374 |
27
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| New Jersey – 10.8% (8.6% of Total Investments) | ||||
| $ 3,000 | Camden County Improvement Authority, New Jersey, Health Care Redevelopment Revenue | 2/24 at 100.00 | BBB+ | $ 3,079,650 |
| Bonds, Cooper Health System Obligated Group Issue, Refunding Series 2014A, 5.000%, 2/15/31 | ||||
| 2,500 | New Jersey Economic Development Authority, Lease Revenue Bonds, State Government | 12/27 at 100.00 | Baa1 | 2,661,325 |
| Buildings-Health Department & Taxation Division Office Project, Series 2018A, 5.000%, 6/15/42 | ||||
| 1,875 | New Jersey Economic Development Authority, Lease Revenue Bonds, State House Project, | 12/28 at 100.00 | Baa1 | 2,032,650 |
| Series 2017B, 5.000%, 6/15/35 | ||||
| 1,400 | New Jersey Economic Development Authority, New Jersey, Transit Transportation Project | 11/29 at 100.00 | Baa1 | 1,414,490 |
| Revenue Bonds, Series 2020A, 4.000%, 11/01/37 | ||||
| 2,705 | New Jersey Economic Development Authority, Revenue Bonds, Motor Vehicle Surcharge, | 7/27 at 100.00 | Baa3 | 2,664,966 |
| Refunding Subordinate Series 2017A, 3.375%, 7/01/30 | ||||
| 2,175 | New Jersey Economic Development Authority, School Facilities Construction Bonds, Series | 6/27 at 100.00 | Baa1 | 2,303,825 |
| 2017DDD, 5.000%, 6/15/42 | ||||
| 1,200 | New Jersey Economic Development Authority, School Facilities Construction Bonds, Tender | 3/23 at 100.00 | Baa1 | 1,243,536 |
| Option Bond Trust Series 2018-XG0168, 5.131%, 9/01/27, 144A, (IF) (5) | ||||
| 1,615 | New Jersey Economic Development Authority, School Facilities Construction Financing | 6/24 at 100.00 | Baa1 (4) | 1,683,137 |
| Program Bonds, Refunding Series 2014PP, 4.000%, 6/15/28, (Pre-refunded 6/15/24) | ||||
| 1,440 | New Jersey Economic Development Authority, School Facilities Construction Financing | 3/25 at 100.00 | Baa1 | 1,525,579 |
| Program Bonds, Tender Option Bond Trust 2016-XF2340, 3.622%, 9/01/25, 144A, (IF) (5) | ||||
| New Jersey Economic Development Authority, Special Facilities Revenue Bonds, Continental | ||||
| Airlines Inc., Series 1999: | ||||
| 1,595 | 5.125%, 9/15/23, (AMT) | 8/22 at 101.00 | Ba3 | 1,615,432 |
| 7,550 | 5.250%, 9/15/29, (AMT) | 8/22 at 101.00 | Ba3 | 7,603,907 |
| 2,410 | New Jersey Economic Development Authority, Special Facilities Revenue Bonds, Continental | 3/24 at 101.00 | Ba3 | 2,454,344 |
| Airlines Inc., Series 2000A & 2000B, 5.625%, 11/15/30, (AMT) | ||||
| 5,000 | New Jersey Educational Facilities Authority, Revenue Bonds, Higher Education Capital | 9/24 at 100.00 | Baa1 | 5,097,050 |
| Improvement Fund Issue, Series 2014A, 4.000%, 9/01/29 | ||||
| 5,760 | New Jersey Health Care Facilities Financing Authority, New Jersey, Revenue Bonds, Saint | 7/22 at 100.00 | BB+ | 5,771,808 |
| Peters University Hospital, Refunding Series 2011, 6.000%, 7/01/26 | ||||
| 1,200 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Princeton | 7/26 at 100.00 | AA | 1,300,860 |
| HealthCare System, Series 2016A, 5.000%, 7/01/30 | ||||
| 1,625 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Refunding | No Opt. Call | Baa1 | 1,191,222 |
| Series 2006C, 0.000%, 12/15/31 – FGIC Insured | ||||
| 15,000 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series | No Opt. Call | Baa1 | 7,479,150 |
| 2009A, 0.000%, 12/15/39, (UB) (5) | ||||
| 1,000 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series | 12/24 at 100.00 | Baa1 | 1,042,900 |
| 2009C, 5.250%, 6/15/32 | ||||
| 2,250 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series | 12/28 at 100.00 | Baa1 | 2,454,638 |
| 2019AA, 5.000%, 6/15/31 | ||||
| New Jersey Turnpike Authority, Revenue Bonds, Tender Option Bond Trust 2016-XF1057: | ||||
| 459 | 22.257%, 1/01/24, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | N/R (4) | 466,243 |
| 41 | 22.257%, 1/01/24, (Pre-refunded 7/01/22), 144A, (IF) (5) | 7/22 at 100.00 | A+ (4) | 41,647 |
| South Jersey Port Corporation, New Jersey, Marine Terminal Revenue Bonds, Refunding | ||||
| Series 2016S: | ||||
| 915 | 5.000%, 1/01/34 | 1/26 at 100.00 | Baa1 | 960,320 |
| 1,505 | 5.000%, 1/01/35 | 1/26 at 100.00 | Baa1 | 1,578,324 |
| 1,000 | 5.000%, 1/01/39 | 1/26 at 100.00 | Baa1 | 1,043,320 |
| 1,705 | South Jersey Port Corporation, New Jersey, Marine Terminal Revenue Bonds, Subordinate | 1/28 at 100.00 | Baa1 | 1,774,700 |
| Series 2017B, 5.000%, 1/01/42, (AMT) | ||||
| Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed | ||||
| Bonds, Series 2018A: | ||||
| 2,250 | 5.000%, 6/01/27 | No Opt. Call | A | 2,439,472 |
| 1,920 | 5.000%, 6/01/30 | 6/28 at 100.00 | A | 2,081,933 |
28
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| New Jersey (continued) | ||||
| $ 5,000 | Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed | 6/28 at 100.00 | BB+ | $ 5,143,350 |
| Bonds, Series 2018B, 5.000%, 6/01/46 | ||||
| 76,095 | Total New Jersey | 70,149,778 | ||
| New Mexico – 0.3% (0.2% of Total Investments) | ||||
| 2,000 | Santa Fe, New Mexico, Retirement Facilities Revenue Bonds, EL Castillo Retirement | 7/22 at 100.00 | BB+ | 2,000,060 |
| Residences Project, Series 2012, 5.000%, 5/15/32 | ||||
| New York – 11.1% (8.8% of Total Investments) | ||||
| 570 | Build New York City Resource Corporation, New York, Revenue Bonds, Bronx Charter School | No Opt. Call | BBB– | 579,057 |
| for Excellence, Series 2013A, 4.000%, 4/01/23 | ||||
| 675 | Build New York City Resource Corporation, New York, Solid Waste Disposal Revenue Bonds, | No Opt. Call | N/R | 690,680 |
| Pratt Paper NY, Inc. Project, Series 2014, 4.500%, 1/01/25, (AMT), 144A | ||||
| Dormitory Authority of the State of New York, Insured Revenue Bonds, Pace University, | ||||
| Series 2013A: | ||||
| 820 | 5.000%, 5/01/23 | No Opt. Call | BBB– | 838,401 |
| 20 | 5.000%, 5/01/23, (ETM) | No Opt. Call | N/R (4) | 20,635 |
| 975 | 5.000%, 5/01/28 | 5/23 at 100.00 | BBB– | 988,660 |
| 25 | 5.000%, 5/01/28, (Pre-refunded 5/01/23) | 5/23 at 100.00 | N/R (4) | 25,770 |
| 10,000 | Hudson Yards Infrastructure Corporation, New York, Revenue Bonds, Second Indenture | No Opt. Call | Aa3 | 11,204,600 |
| Fiscal 2017 Series A, 5.000%, 2/15/27, (UB) (5) | ||||
| 790 | Jefferson County Civic Facility Development Corporation, New York, Revenue Bonds, | 11/27 at 100.00 | BB | 739,930 |
| Samaritan Medical Center Project, Series 2017A, 4.000%, 11/01/42 | ||||
| 1,555 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Bond | No Opt. Call | N/R | 1,567,860 |
| Anticipation Note Series 2019D-1, 5.000%, 9/01/22 | ||||
| 780 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Bond | No Opt. Call | N/R | 793,603 |
| Anticipation Note Series 2020A-1, 5.000%, 2/01/23 | ||||
| 5,000 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Green | 5/31 at 100.00 | A3 | 4,943,650 |
| Climate Bond Certified Series 2021A-1, 4.000%, 11/15/44 | ||||
| 1,000 | Nassau County Tobacco Settlement Corporation, New York, Tobacco Settlement Asset-Backed | 6/22 at 100.00 | CCC+ | 1,002,140 |
| Bonds, Refunding Series 2006A-2, 5.250%, 6/01/26 | ||||
| 2,450 | New York Counties Tobacco Trust VI, New York, Tobacco Settlement Pass-Through Bonds, | No Opt. Call | BBB | 2,543,320 |
| Series 2016A-1, 5.625%, 6/01/35 | ||||
| 1,500 | New York Liberty Development Corporation, New York, Liberty Revenue Bonds, 3 World Trade | 11/24 at 100.00 | N/R | 1,506,480 |
| Center Project, Class 1 Series 2014, 5.000%, 11/15/44, 144A | ||||
| 6,500 | New York Liberty Development Corporation, New York, Liberty Revenue Bonds, 3 World Trade | 11/24 at 100.00 | N/R | 6,611,995 |
| Center Project, Class 2 Series 2014, 5.150%, 11/15/34, 144A | ||||
| 1,355 | New York Transportation Development Corporation, New York, Facility Revenue Bonds, | 10/31 at 100.00 | BBB– | 1,289,784 |
| Thruway Service Areas Project, Series 2021, 4.000%, 10/31/46, (AMT) | ||||
| New York Transportation Development Corporation, New York, Special Facilities Bonds, | ||||
| LaGuardia Airport Terminal B Redevelopment Project, Series 2016A: | ||||
| 760 | 4.000%, 7/01/32, (AMT) | 7/24 at 100.00 | BBB | 761,011 |
| 500 | 4.000%, 7/01/33, (AMT) | 7/24 at 100.00 | BBB | 500,345 |
| 1,000 | 4.000%, 7/01/46 – AGM Insured, (AMT) | 7/24 at 100.00 | AA | 999,850 |
| 430 | New York Transportation Development Corporation, New York, Special Facility Revenue | 6/22 at 100.00 | B | 430,030 |
| Bonds, American Airlines, Inc. John F Kennedy International Airport Project, Refunding Series | ||||
| 2016, 5.000%, 8/01/31, (AMT) | ||||
| 1,065 | New York Transportation Development Corporation, New York, Special Facility Revenue | 8/30 at 100.00 | B | 1,132,585 |
| Bonds, American Airlines, Inc. John F Kennedy International Airport Project, Series 2020, | ||||
| 5.250%, 8/01/31, (AMT) |
29
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| New York (continued) | ||||
| New York Transportation Development Corporation, Special Facility Revenue Bonds, Delta | ||||
| Air Lines, Inc. – LaGuardia Airport Terminals C&D Redevelopment Project, Series 2018: | ||||
| $ 2,000 | 5.000%, 1/01/28, (AMT) | No Opt. Call | Baa3 | $ 2,104,440 |
| 2,000 | 5.000%, 1/01/30, (AMT) | 1/28 at 100.00 | Baa3 | 2,090,400 |
| 2,315 | 5.000%, 1/01/32, (AMT) | 1/28 at 100.00 | Baa3 | 2,407,785 |
| 1,680 | 5.000%, 1/01/33, (AMT) | 1/28 at 100.00 | Baa3 | 1,744,563 |
| 935 | 5.000%, 1/01/36, (AMT) | 1/28 at 100.00 | Baa3 | 967,304 |
| 4,110 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, Two Hundred | 7/30 at 100.00 | Aa3 | 4,088,299 |
| Twenty-One Series 2020, 4.000%, 7/15/50, (AMT), (UB) (5) | ||||
| Syracuse Industrial Development Authority, New York, PILOT Revenue Bonds, Carousel | ||||
| Center Project, Refunding Series 2016A: | ||||
| 820 | 5.000%, 1/01/32, (AMT) | 1/26 at 100.00 | Caa1 | 686,127 |
| 5,000 | 5.000%, 1/01/33, (AMT) | 1/26 at 100.00 | Caa1 | 4,101,100 |
| 3,820 | 5.000%, 1/01/35, (AMT) | 1/26 at 100.00 | Caa1 | 3,051,416 |
| 650 | 5.000%, 1/01/36, (AMT) | 1/26 at 100.00 | Caa1 | 511,225 |
| 6,890 | TSASC Inc., New York, Tobacco Asset-Backed Bonds, Series 2006, 5.000%, 6/01/45 | 6/27 at 100.00 | CCC+ | 7,026,215 |
| TSASC Inc., New York, Tobacco Settlement Asset-Backed Bonds, Fiscal 2017 Series B: | ||||
| 2,000 | 5.000%, 6/01/24 | No Opt. Call | B– | 2,004,020 |
| 2,250 | 5.000%, 6/01/25 | No Opt. Call | B– | 2,249,370 |
| 72,240 | Total New York | 72,202,650 | ||
| North Carolina – 1.1% (0.9% of Total Investments) | ||||
| 750 | Bay Area Toll Authority, North Carolina, Revenue Bonds, San Francisco Bay Area Toll | 10/26 at 100.00 | AA | 762,900 |
| Bridge, Tender Option Bond Trust 2016-XG0019, 3.658%, 4/01/36, 144A, (IF) (5) | ||||
| 6,225 | North Carolina Turnpike Authority, Triangle Expressway System Revenue Bonds, Senior Lien | 1/30 at 100.00 | Aa1 | 6,591,528 |
| Series 2019, 5.000%, 1/01/49 | ||||
| 6,975 | Total North Carolina | 7,354,428 | ||
| North Dakota – 0.7% (0.5% of Total Investments) | ||||
| 5,000 | Grand Forks, North Dakota, Health Care System Revenue Bonds, Altru Health System | 12/31 at 100.00 | AA | 4,279,150 |
| Obligated Group, Series 2021, 3.000%, 12/01/46 – AGM Insured | ||||
| Ohio – 4.3% (3.4% of Total Investments) | ||||
| 9,070 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed | 6/30 at 100.00 | BBB+ | 8,784,658 |
| Revenue Bonds, Refunding Senior Lien Series 2020A-2 Class 1, 4.000%, 6/01/48 | ||||
| 5,535 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed | 6/30 at 100.00 | N/R | 5,622,453 |
| Revenue Bonds, Refunding Senior Lien Series 2020B-2 Class 2, 5.000%, 6/01/55 | ||||
| 3,240 | Cleveland, Ohio, Airport Special Revenue Bonds, Continental Airlines Inc. Project, | 7/22 at 100.00 | Ba3 | 3,242,754 |
| Series 1998, 5.375%, 9/15/27, (AMT) | ||||
| 2,650 | County of Lucas, Ohio, Hospital Revenue Bonds, ProMedica Healthcare Obligated Group, | 11/28 at 100.00 | BBB | 2,650,530 |
| Series 2018A, 5.250%, 11/15/48 | ||||
| 560 | Franklin County Convention Facilities Authority, Ohio, Hotel Project Revenue Bonds, | 12/29 at 100.00 | BBB– | 571,082 |
| Greater Columbus Convention Center Hotel Expansion Project, Series 2019, 5.000%, 12/01/51 | ||||
| 4,190 | Ohio Air Quality Development Authority, Ohio, Air Quality Development Revenue Bonds, | No Opt. Call | N/R | 5,238 |
| FirstEnergy Generation Corporation Project, Series 2009A, 5.700%, 8/01/22 | ||||
| 6,000 | Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, | No Opt. Call | N/R | 5,472,900 |
| FirstEnergy Generation Corporation Project, Refunding Series 2009D, 3.375%, 8/01/29, | ||||
| (Mandatory Put 9/15/21) | ||||
| 17,065 | Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, | No Opt. Call | N/R | 21,331 |
| FirstEnergy Generation Project, Refunding Series 2006A, 3.750%, 12/01/23 (7) | ||||
| 700 | Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, | No Opt. Call | N/R | 700,000 |
| FirstEnergy Nuclear Generation Project, Refunding Series 2009A, 4.750%, 6/01/33, (Mandatory | ||||
| Put 6/01/22), (WI/DD, Settling 6/01/22) | ||||
| 260 | Ohio Air Quality Development Authority, Ohio, Revenue Bonds, Pratt Paper Ohio, LLC | 1/28 at 100.00 | N/R | 259,399 |
| Project, Series 2017, 4.250%, 1/15/38, (AMT), 144A | ||||
| 6,000 | Ohio Water Development Authority, Pollution Control Revenue Refunding Bonds, FirstEnergy | No Opt. Call | N/R | 7,500 |
| Nuclear Generating Corporation Project, Series 2006B, 4.000%, 12/01/33 (7) |
30
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Ohio (continued) | ||||
| $ 730 | Southeastern Ohio Port Authority, Hospital Facilities Revenue Bonds, Memorial Health | No Opt. Call | BB– | $ 739,169 |
| System Obligated Group Project, Refunding and Improvement Series 2012, 5.000%, 12/01/22 | ||||
| 56,000 | Total Ohio | 28,077,014 | ||
| Oklahoma – 1.1% (0.9% of Total Investments) | ||||
| 975 | Oklahoma Development Finance Authority, Health System Revenue Bonds, OU Medicine | 8/28 at 100.00 | Baa3 | 982,527 |
| Project, Series 2018B, 5.000%, 8/15/38 | ||||
| 6,050 | Tulsa Municipal Airport Trust, Oklahoma, Revenue Bonds, American Airlines Inc., | 6/25 at 100.00 | B– | 6,209,176 |
| Refunding Series 2015, 5.000%, 6/01/35, (AMT), (Mandatory Put 6/01/25) | ||||
| 7,025 | Total Oklahoma | 7,191,703 | ||
| Oregon – 0.3% (0.2% of Total Investments) | ||||
| 1,000 | Astoria Hospital Facilities Authority, Oregon, Hospital Revenue and Refunding Bonds, | 8/22 at 100.00 | A– | 1,005,710 |
| Columbia Memorial Hospital, Series 2012, 5.000%, 8/01/31 | ||||
| 730 | Port of Saint Helens, Oregon, Pollution Control Revenue Bonds, Boise Cascade Project, | 7/22 at 100.00 | N/R | 730,168 |
| Series 1997, 5.650%, 12/01/27 | ||||
| 1,730 | Total Oregon | 1,735,878 | ||
| Pennsylvania – 4.9% (3.9% of Total Investments) | ||||
| Allegheny County Industrial Development Authority, Pennsylvania, Environmental | ||||
| Improvement Revenue Bonds, United States Steel Corp., Refunding Series 2019: | ||||
| 815 | 4.875%, 11/01/24 | No Opt. Call | B | 834,430 |
| 725 | 5.125%, 5/01/30 | No Opt. Call | B | 769,783 |
| 419 | Allegheny County Redevelopment Authority, Pennsylvania, TIF Revenue Bonds, Pittsburg | 7/22 at 100.00 | N/R | 377,547 |
| Mills Project, Series 2004, 5.600%, 7/01/23 (7) | ||||
| 1,000 | Allentown Neighborhood Improvement Zone Development Authority, Pennsylvania, Tax Revenue | No Opt. Call | Ba3 | 1,077,680 |
| Bonds, City Center Project, Series 2018, 5.000%, 5/01/28, 144A | ||||
| 420 | Beaver County Industrial Development Authority, Pennsylvania, Pollution Control Revenue | No Opt. Call | N/R | 525 |
| Bonds, FirstEnergy Nuclear Generation Project, Refunding Series 2005A, 4.000%, 1/01/35 (7) | ||||
| 400 | Beaver County Industrial Development Authority, Pennsylvania, Pollution Control Revenue | No Opt. Call | N/R | 500 |
| Bonds, FirstEnergy Nuclear Generation Project, Refunding Series 2008A, 2.700%, 4/01/35 (7) | ||||
| 1,450 | Doylestown Hospital Authority, Pennsylvania, Hospital Revenue Bonds, Series 2013A, | No Opt. Call | BBB– | 1,492,210 |
| 5.000%, 7/01/23 | ||||
| 825 | East Hempfield Township Industrial Development Authority, Pennsylvania, Student Services | 7/25 at 100.00 | N/R (4) | 895,851 |
| Inc – Student Housing Project at Millersville University, Series 2015, 5.000%, 7/01/30, | ||||
| (Pre-refunded 7/01/25) | ||||
| 1,000 | Montgomery County Industrial Development Authority, Pennsylvania, Revenue Bonds, | 1/25 at 100.00 | N/R | 1,019,090 |
| Whitemarsh Continuing Care Retirement Community Project, Series 2015, 5.000%, 1/01/30 | ||||
| 1,595 | Northampton County Industrial Development Authority, Pennsylvania, Revenue Bonds, | 7/22 at 100.00 | BB+ | 1,595,622 |
| Morningstar Senior Living, Inc., Series 2012, 5.000%, 7/01/27 | ||||
| 1,805 | Pennsylvania Economic Development Financing Authority, Exempt Facilities Revenue Bonds, | No Opt. Call | N/R | 2,256 |
| Shippingport Project, First Energy Guarantor., Series 2005A, 3.750%, 12/01/40 (7) | ||||
| 1,970 | Pennsylvania Higher Educational Facilities Authority, Revenue Bonds, University of | 8/29 at 100.00 | AA | 1,978,688 |
| Pennsylvania Health System, Series 2019, 4.000%, 8/15/49 (5) | ||||
| 4,000 | Pennsylvania Public School Building Authority, Lease Revenue Bonds, School District of | No Opt. Call | AA | 4,468,600 |
| Philadelphia, Series 2006B, 5.000%, 6/01/27 – AGM Insured | ||||
| 3,500 | Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, Refunding Subordinate Second | 12/27 at 100.00 | A3 | 3,811,570 |
| Series 2017, 5.000%, 12/01/35 | ||||
| 10,980 | Philadelphia Hospitals and Higher Education Facilities Authority, Pennsylvania, Hospital | 7/27 at 100.00 | BBB– | 11,691,175 |
| Revenue Bonds, Temple University Health System Obligated Group, Series of 2017, 5.000%, 7/01/34 | ||||
| 1,610 | Scranton, Lackawanna County, Pennsylvania, General Obligation Notes, Series 2016, | 5/24 at 100.00 | BB+ | 1,638,899 |
| 5.000%, 11/15/32 | ||||
| 32,514 | Total Pennsylvania | 31,654,426 |
31
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Puerto Rico – 9.5% (7.5% of Total Investments) | ||||
| Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Refunding Senior Lien Series 2020A: | ||||
| $ 5,000 | 5.000%, 7/01/30, 144A | No Opt. Call | N/R | $ 5,373,950 |
| 4,750 | 5.000%, 7/01/35, 144A | 7/30 at 100.00 | N/R | 5,004,600 |
| 1,000 | 5.000%, 7/01/47, 144A | 7/30 at 100.00 | N/R | 1,039,010 |
| 3,000 | Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Senior Lien Series 2012A, | 7/22 at 100.00 | CCC | 3,010,530 |
| 5.750%, 7/01/37 | ||||
| 3,500 | Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 2007N, | No Opt. Call | N/R | 3,411,450 |
| 8.991%, 7/01/27 – AMBAC Insured (12MTA reference rate + 1.120% spread) (9) | ||||
| Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Restructured 2018A-1: | ||||
| 4,000 | 0.000%, 7/01/31 | 7/28 at 91.88 | N/R | 2,750,240 |
| 8,470 | 1.000%, 7/01/33 | 7/28 at 86.06 | N/R | 5,183,471 |
| 449 | 4.500%, 7/01/34 | 7/25 at 100.00 | N/R | 459,565 |
| 1,245 | 0.000%, 7/01/51 | 7/28 at 30.01 | N/R | 275,083 |
| 2,031 | 4.750%, 7/01/53 | 7/28 at 100.00 | N/R | 2,043,389 |
| 5,340 | 5.000%, 7/01/58 | 7/28 at 100.00 | N/R | 5,442,581 |
| Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Taxable | ||||
| Restructured Cofina Project Series 2019A-2: | ||||
| 2,500 | 4.329%, 7/01/40 | 7/28 at 100.00 | N/R | 2,503,100 |
| 1,791 | 4.329%, 7/01/40 | 7/28 at 100.00 | N/R | 1,793,221 |
| Puerto Rico, General Obligation Bonds, Restructured Series 2022A-1: | ||||
| 1,834 | 5.250%, 7/01/23 | No Opt. Call | N/R | 1,858,917 |
| 324 | 0.010%, 7/01/24 | No Opt. Call | N/R | 298,306 |
| 1,722 | 5.375%, 7/01/25 | No Opt. Call | N/R | 1,813,787 |
| 696 | 5.625%, 7/01/27 | No Opt. Call | N/R | 760,157 |
| 685 | 5.625%, 7/01/29 | No Opt. Call | N/R | 757,657 |
| 665 | 5.750%, 7/01/31 | No Opt. Call | N/R | 753,478 |
| 3,812 | 0.000%, 7/01/33 | 7/31 at 89.94 | N/R | 2,262,185 |
| 631 | 4.000%, 7/01/33 | 7/31 at 103.00 | N/R | 618,458 |
| 567 | 4.000%, 7/01/35 | 7/31 at 103.00 | N/R | 548,326 |
| 487 | 4.000%, 7/01/37 | 7/31 at 103.00 | N/R | 470,599 |
| 4,161 | 4.000%, 7/01/41 | 7/31 at 103.00 | N/R | 3,953,090 |
| 7,953 | 4.000%, 7/01/46 | 7/31 at 103.00 | N/R | 7,440,540 |
| 3,149 | Puerto Rico, General Obligation Bonds, Vintage CW NT Claims Taxable Series 2022, | No Opt. Call | N/R | 1,633,521 |
| 0.000%, 11/01/43 | ||||
| 69,762 | Total Puerto Rico | 61,459,211 | ||
| Rhode Island – 0.5% (0.4% of Total Investments) | ||||
| Providence Redevelopment Agency, Rhode Island, Revenue Bonds, Public Safety and | ||||
| Municipal Building Projects, Refunding Series 2015A: | ||||
| 1,400 | 5.000%, 4/01/23 | No Opt. Call | BBB | 1,425,662 |
| 1,500 | 5.000%, 4/01/24 | No Opt. Call | BBB | 1,550,445 |
| 2,900 | Total Rhode Island | 2,976,107 | ||
| South Carolina – 0.8% (0.7% of Total Investments) | ||||
| 1,450 | South Carolina Jobs-Economic Development Authority, Economic Development Revenue Bonds, | 2/25 at 100.00 | BB+ | 1,495,806 |
| Palmetto Scholars Academy Project, Series 2015A, 5.125%, 8/15/35, 144A | ||||
| South Carolina Jobs-Economic Development Authority, Hospital Revenue Bonds, Bon Secours | ||||
| Health System Obligated Group, Tender Option Bond Trust 2016-XG0098: | ||||
| 1,500 | 19.718%, 11/01/27, (Pre-refunded 11/01/22), 144A, (IF) (5) | 11/22 at 100.00 | N/R (4) | 1,613,610 |
| 1,010 | 19.699%, 11/01/28, (Pre-refunded 11/01/22), 144A, (IF) (5) | 11/22 at 100.00 | N/R (4) | 1,086,427 |
| 1,255 | 19.718%, 11/01/29, (Pre-refunded 11/01/22), 144A, (IF) (5) | 11/22 at 100.00 | N/R (4) | 1,350,053 |
| 5,215 | Total South Carolina | 5,545,896 | ||
| Tennessee – 2.0% (1.6% of Total Investments) | ||||
| 1,935 | Knox County Health, Educational and Housing Facility Board, Tennessee, Hospital Revenue | 1/23 at 100.00 | A+ | 1,961,877 |
| Bonds, Covenant Health, Refunding Series 2012A, 5.000%, 1/01/26 |
32
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Tennessee (continued) | ||||
| Knox County Health, Educational, and Housing Facilities Board, Tennessee, Revenue Bonds, | ||||
| Provision Center for Proton Therapy Project, Series 2014: | ||||
| $ 3,055 | 5.250%, 5/01/25, 144A (7) | 11/24 at 100.00 | N/R | $ 1,435,850 |
| 525 | 6.000%, 5/01/34, 144A (7) | 11/24 at 100.00 | N/R | 246,750 |
| 9,050 | Tennergy Corporation, Tennessee, Gas Revenue Bonds, Series 2021A, 4.000%, 12/01/51, | 6/28 at 100.68 | A1 | 9,356,071 |
| (Mandatory Put 9/01/28) | ||||
| 14,565 | Total Tennessee | 13,000,548 | ||
| Texas – 4.1% (3.2% of Total Investments) | ||||
| 1,110 | Austin, Travis, Williamson and Hays Counties, Texas, Special Assessment Revenue Bonds, | 11/23 at 100.00 | N/R | 1,116,782 |
| Estancia Hill Country Public Improvement District, Series 2013, 6.000%, 11/01/28 | ||||
| 2,000 | Central Texas Regional Mobility Authority, Revenue Bonds, Senior Lien, Series 2015A, | 7/25 at 100.00 | A– (4) | 2,174,880 |
| 5.000%, 1/01/40, (Pre-refunded 7/01/25) | ||||
| 180 | Clifton Higher Education Finance Corporation, Texas, Education Revenue Bonds, Idea | No Opt. Call | A– | 180,769 |
| Public Schools, Series 2012, 3.750%, 8/15/22 | ||||
| 2,000 | Dallas Area Rapid Transit, Texas, Sales Tax Revenue Bonds, Tender Option Bond Trust | No Opt. Call | AA+ | 4,053,240 |
| 3307, 21.152%, 12/01/30 – AMBAC Insured, 144A, (IF) (5) | ||||
| 2,000 | Gulf Coast Industrial Development Authority, Texas, Solid Waste Disposal Revenue Bonds, | 10/22 at 100.00 | BB | 2,000,080 |
| Citgo Petroleum Corporation Project, Series 1995, 4.875%, 5/01/25, (AMT) | ||||
| Harris County Cultural Education Facilities Finance Corporation, Texas, Revenue | ||||
| Refunding Bonds, Young Men’s Christian Association of the Greater Houston Area, Series 2013A: | ||||
| 855 | 5.000%, 6/01/22 | No Opt. Call | Baa2 | 855,000 |
| 915 | 5.000%, 6/01/23 | No Opt. Call | Baa2 | 925,733 |
| 3,750 | Harris County-Houston Sports Authority, Texas, Revenue Bonds, Third Lien Series 2004A-3, | 11/24 at 49.42 | Baa2 | 1,680,975 |
| 0.000%, 11/15/36 | ||||
| 3,000 | Houston, Texas, Airport System Special Facilities Revenue Bonds, United Airlines, Inc. | No Opt. Call | B | 3,081,000 |
| Airport Improvement Projects, Series 2018C, 5.000%, 7/15/28, (AMT) | ||||
| 250 | Houston, Texas, Airport System Special Facilities Revenue Bonds, United Airlines, Inc. | No Opt. Call | B– | 259,110 |
| Terminal Improvements Project, Refunding Series 2020B-2, 5.000%, 7/15/27, (AMT) | ||||
| 1,000 | Love Field Airport Modernization Corporation, Texas, Special Facilities Revenue Bonds, | 11/22 at 100.00 | Baa1 | 1,012,400 |
| Southwest Airlines Company – Love Field Modernization Program Project, Series 2012, 5.000%, | ||||
| 11/01/28, (AMT) | ||||
| 1,000 | New Hope Cultural Education Facilities Finance Corporation, Texas, Student Housing | 4/24 at 100.00 | N/R (4) | 1,055,050 |
| Revenue Bonds, CHF-Collegiate Housing Corpus Christi I, L.L.C.-Texas A&M University-Corpus | ||||
| Christi Project, Series 2014A, 5.000%, 4/01/34, (Pre-refunded 4/01/24) | ||||
| 1,500 | Port Beaumont Navigation District, Jefferson County, Texas, Dock and Wharf Facility | 7/22 at 103.00 | N/R | 1,336,245 |
| Revenue Bonds, Jefferson Gulf Coast Energy Project, Series 2020, 3.625%, 1/01/35, (AMT), 144A | ||||
| 1,250 | Port Beaumont Navigation District, Jefferson County, Texas, Dock and Wharf Facility | 7/23 at 103.00 | N/R | 905,175 |
| Revenue Bonds, Jefferson Gulf Coast Energy Project, Series 2021A, 2.875%, 1/01/41, (AMT), 144A | ||||
| 2,680 | San Antonio Public Facilities Corporation, Texas, Lease Revenue Bonds, Convention Center | 9/22 at 100.00 | AA+ | 2,775,649 |
| Refinancing & Expansion Project, Tender Option Bond Trust 2015-XF0125, 19.305%, 9/15/29, | ||||
| 144A, (IF) (5) | ||||
| Tarrant County Cultural Education Facilities Finance Corporation, Texas, Hospital | ||||
| Revenue Bonds, Scott & White Healthcare Project, Tender Option Bond Trust 2016-XG0058: | ||||
| 100 | 19.415%, 8/15/22, 144A, (IF) (5) | No Opt. Call | AA– | 103,815 |
| 155 | 19.240%, 8/15/24, (Pre-refunded 8/15/23), 144A, (IF) (5) | 8/23 at 100.00 | AA– (4) | 185,918 |
| 200 | 19.415%, 8/15/26, (Pre-refunded 8/15/23), 144A, (IF) (5) | 8/23 at 100.00 | AA– (4) | 240,284 |
| 170 | 19.205%, 8/15/27, (Pre-refunded 8/15/23), 144A, (IF) (5) | 8/23 at 100.00 | AA– (4) | 203,844 |
| 1,210 | Texas Department of Housing and Community Affairs, Single Family Mortgage Revenue Bonds, | 9/27 at 100.00 | Aaa | 1,237,612 |
| Series 2018A, 4.250%, 9/01/48 (5) | ||||
| 1,190 | Westlake, Texas, Special Assessment Revenue Bonds, Solana Public Improvement District, | 9/25 at 100.00 | N/R | 1,156,775 |
| Series 2015, 6.125%, 9/01/35 | ||||
| 26,515 | Total Texas | 26,540,336 |
33
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Virgin Islands – 0.1% (0.1% of Total Investments) | ||||
| $ 840 | Virgin Islands Public Finance Authority, Matching Fund Loan Notes Revenue Bonds, | No Opt. Call | AA | $ 875,356 |
| Refunding Senior Lien Series 2013B, 5.000%, 10/01/24 – AGM Insured | ||||
| Virginia – 0.9% (0.7% of Total Investments) | ||||
| 1,000 | Roanoke Economic Development Authority, Virgina, Residential Care Facility Mortgage | 12/22 at 100.00 | N/R (4) | 1,017,710 |
| Revenue Refunding Bonds, Virginia Lutheran Homes Brandon Oaks Project, Series 2012, 5.000%, | ||||
| 12/01/32, (Pre-refunded 12/01/22) | ||||
| Virginia Gateway Community Development Authority, Prince William County, Virginia, | ||||
| Special Assessment Refunding Bonds, Series 2012: | ||||
| 695 | 5.000%, 3/01/25 | 7/22 at 100.00 | N/R | 695,049 |
| 110 | 4.500%, 3/01/29 | 7/22 at 100.00 | N/R | 104,937 |
| 1,505 | 5.000%, 3/01/30 | 7/22 at 100.00 | N/R | 1,484,938 |
| 2,500 | Virginia Housing Development Authority, Rental Housing Bonds, Series 2018E, | 12/27 at 100.00 | AA+ | 2,553,200 |
| 4.150%, 12/01/49 | ||||
| 5,810 | Total Virginia | 5,855,834 | ||
| Washington – 2.6% (2.0% of Total Investments) | ||||
| 2,200 | Port of Seattle Industrial Development Corporation, Washington, Special Facilities | 4/23 at 100.00 | BB+ | 2,212,826 |
| Revenue Refunding Bonds, Delta Air Lines, Inc. Project, Series 2012, 5.000%, 4/01/30, (AMT) | ||||
| 4,000 | Port of Seattle, Washington, Revenue Bonds, Refunding First Lien Series 2016B, 5.000%, | 4/26 at 100.00 | Aa2 | 4,326,800 |
| 10/01/32, (AMT), (UB) (5) | ||||
| 270 | Tacoma Consolidated Local Improvement District 65, Washington, Special Assessment Bonds, | 6/22 at 100.00 | N/R | 267,370 |
| Series 2013, 5.750%, 4/01/43 | ||||
| 5,000 | Washington Health Care Facilities Authority, Revenue Bonds, Catholic Health Initiative, | 7/24 at 100.00 | BBB+ | 5,086,250 |
| Tender Option Bonds Trust 2015-XF1017, 3.978%, 1/01/35, 144A, (IF) (5) | ||||
| 970 | Washington Health Care Facilities Authority, Revenue Bonds, CommonSpirit Health, Series | 8/29 at 100.00 | BBB+ | 1,025,863 |
| 2019A-2, 5.000%, 8/01/35 | ||||
| Washington State Housing Finance Commission, Non-Profit Housing Revenue Bonds, Mirabella | ||||
| Project, Series 2012A: | ||||
| 585 | 6.000%, 10/01/22, (ETM), 144A | No Opt. Call | N/R (4) | 594,132 |
| 2,080 | 6.500%, 10/01/32, (Pre-refunded 10/03/22), 144A | 10/22 at 100.00 | N/R (4) | 2,115,235 |
| 1,000 | Washington State Housing Finance Commission, Non-Profit Revenue Bonds, Emerald Heights | No Opt. Call | A– | 1,029,550 |
| Project, Refunding 2013, 5.000%, 7/01/23 | ||||
| 16,105 | Total Washington | 16,658,026 | ||
| West Virginia – 0.1% (0.1% of Total Investments) | ||||
| 500 | West Virginia Economic Development Authority, Excess Lottery Revenue Bonds, Series | 7/27 at 100.00 | AAA | 562,715 |
| 2017A, 5.000%, 7/01/30 | ||||
| Wisconsin – 3.2% (2.5% of Total Investments) | ||||
| 415 | Platteville Redevelopment Authority, Wisconsin, Revenue Bonds, University of Wisconsin - | 7/22 at 100.00 | BBB– | 415,108 |
| Platteville Real Estate Foundation Project, Series 2012A, 5.000%, 7/01/42 | ||||
| Public Finance Authority of Wisconsin, Educational Facility Revenue Bonds, Cottonwood | ||||
| Classical Preparatory School in Albuquerque, New Mexico, Series 2012A: | ||||
| 230 | 5.250%, 12/01/22, (ETM) | No Opt. Call | N/R (4) | 234,322 |
| 1,610 | 6.000%, 12/01/32, (Pre-refunded 12/01/22) | 12/22 at 100.00 | N/R (4) | 1,646,370 |
| 3,190 | Public Finance Authority of Wisconsin, Limited Obligation Grant Revenue Bonds, American | No Opt. Call | N/R | 3,054,202 |
| Dream @ Meadowlands Project, Series 2017A, 3.125%, 8/01/27, 144A (7) | ||||
| Public Finance Authority of Wisconsin, Limited Obligation PILOT Revenue Bonds, American | ||||
| Dream @ Meadowlands Project, Series 2017: | ||||
| 870 | 5.000%, 12/01/27, 144A | No Opt. Call | N/R | 798,034 |
| 1,000 | 6.500%, 12/01/37, 144A | 12/27 at 100.00 | N/R | 937,910 |
| 345 | Public Finance Authority of Wisconsin, Revenue Bonds, Prime Healthcare Foundation, Inc., | No Opt. Call | BBB– | 362,681 |
| Series 2017A, 5.000%, 12/01/27 |
34
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Wisconsin (continued) | ||||
| $ 155 | Public Finance Authority of Wisconsin, Senior Airport Facilities Revenue and Refunding | No Opt. Call | BBB+ | $ 155,251 |
| Bonds, TrIPS Obligated Group, Series 2012B, 5.000%, 7/01/22 | ||||
| 4,300 | Public Finance Authority of Wisconsin, Solid Waste Disposal Revenue Bonds, Waste | 5/26 at 100.00 | A– | 4,153,112 |
| Management Inc., Refunding Series 2016A-2, 2.875%, 5/01/27 | ||||
| 1,115 | Public Finance Authority of Wisconsin, Student Housing Revenue Bonds, Collegiate Housing | 7/25 at 100.00 | BBB– | 1,142,752 |
| Foundation – Cullowhee LLC – Western California University Project, Series 2015A, | ||||
| 5.000%, 7/01/30 | ||||
| University of Wisconsin Hospitals and Clinics Authority, Revenue Bonds, Tender Option | ||||
| Bond Trust 2015-XF0127: | ||||
| 100 | 19.200%, 4/01/23, 144A, (IF) (5) | No Opt. Call | AA– | 114,054 |
| 185 | 18.864%, 4/01/24, 144A, (IF) (5) | 4/23 at 100.00 | AA– | 210,508 |
| 100 | 19.200%, 4/01/25, 144A, (IF) (5) | 4/23 at 100.00 | AA– | 114,054 |
| Wisconsin Center District, Dedicated Tax Revenue Bonds, Refunding Junior Series 1999: | ||||
| 5 | 5.250%, 12/15/23 | No Opt. Call | AA | 5,167 |
| 5 | 5.250%, 12/15/23, (ETM) | No Opt. Call | AA (4) | 5,060 |
| 5 | 5.250%, 12/15/27, (ETM) | No Opt. Call | AA (4) | 5,568 |
| 10 | 5.250%, 12/15/27 | No Opt. Call | AA | 11,085 |
| 6,000 | Wisconsin Center District, Dedicated Tax Revenue Bonds, Supported by State Moral | 12/30 at 56.77 | AA | 2,217,180 |
| Obligation Junior Series 2020D, 0.000%, 12/15/45 – AGM Insured | ||||
| 1,175 | Wisconsin Housing and Economic Development Authority, Housing Revenue Bonds, Series | 11/26 at 100.00 | AA | 1,189,476 |
| 2017A, 4.000%, 11/01/47 | ||||
| 2,000 | Wisconsin Housing and Economic Development Authority, Housing Revenue Bonds, Series | 11/28 at 100.00 | AA | 1,783,520 |
| 2019A, 3.150%, 11/01/44 | ||||
| 2,480 | Wisconsin Housing and Economic Development Authority, Housing Revenue Bonds, Series | 5/31 at 100.00 | N/R | 1,955,207 |
| 2021C, 2.850%, 11/01/51 | ||||
| 25,295 | Total Wisconsin | 20,510,621 | ||
| $ 813,704 | Total Municipal Bonds (cost $773,218,808) | 755,976,485 | ||
| Shares | Description (1) | Value | ||
| COMMON STOCKS – 9.7% (7.7% of Total Investments) | ||||
| Independent Power and Renewable Electricity Producers – 9.7% (7.7% of Total Investments) | ||||
| 965,836 | Energy Harbor Corp (10), (11), (12) | $ 63,213,966 | ||
| Total Common Stocks (cost $25,699,081) | 63,213,966 | |||
| Total Long-Term Investments (cost $798,917,889) | 819,190,451 | |||
| Floating Rate Obligations – (4.3)% | (27,950,000) | |||
| Adjustable Rate MuniFund Term Preferred Shares, net of deferred offering costs – (27.0)% (13) | (174,968,336) | |||
| Other Assets Less Liabilities – 5.0% (14) | 32,104,828 | |||
| Net Assets Applicable to Common Shares – 100% | $ 648,376,943 | |||
Investments in Derivatives
Futures Contracts – Short
| Unrealized | |||||
| Number of | Expiration | Notional | Appreciation | ||
| Description | Contracts | Date | Amount | Value | (Depreciation) |
| U.S. Treasury Ultra Bond | (16) | 9/22 | $(2,538,334) | $(2,492,000) | $46,334 |
35
| NID | Nuveen Intermediate Duration Municipal Term Fund |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| (1) | All percentages shown in the Portfolio of Investments are based on net assets applicable to common shares unless otherwise noted. |
| (2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. Optional Call Provisions are not covered by the report of independent registered public accounting firm. |
| (3) | The ratings disclosed are the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. Ratings are not covered by the report of independent registered public accounting firm. |
| (4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. |
| (5) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in inverse floating rate transactions. |
| (6) | Step-up coupon bond, a bond with a coupon that increases ("steps up"), usually at regular intervals, while the bond is outstanding. The rate shown is the coupon as of the end of the reporting period. |
| (7) | Defaulted security. A security whose issuer has failed to fully pay principal and/or interest when due, or is under the protection of bankruptcy. |
| (8) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board. For fair value measurement disclosure purposes, investment classified as Level 3. |
| (9) | Variable rate security. The rate shown is the coupon as of the end of the reporting period. |
| (10) | For fair value measurement disclosure purposes, investment classified as Level 2. |
| (11) | Common Stock received as part of the bankruptcy settlements during February 2020 for Beaver County Industrial Development Authority, Pennsylvania, Pollution Control Revenue Bonds, FirstEnergy Nuclear Generation Project, Refunding Series 2005A, 4.000%, 1/01/35, Beaver County Industrial Development Authority, Pennsylvania, Pollution Control Revenue Refunding Bonds, FirstEnergy Nuclear Generation Project, Series 2008A, 2.700%, 4/01/35, Ohio Air Quality Development Authority, Ohio, Air Quality Development Revenue Bonds, FirstEnergy Generation Corporation Project, Series 2009A, 5.700%, 8/01/20, Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, FirstEnergy Generation Project, Refunding Series 2006A, 3.750%, 12/01/23, Ohio Water Development Authority, Pollution Control Revenue Refunding Bonds, FirstEnergy Nuclear Generating Corporation Project, Series 2006B, 0.000%, 12/01/33 and Pennsylvania Economic Development Financing Authority, Exempt Facilities Revenue Bonds, Shippingport Project, First Energy Guarantor, Series 2005A, 3.750%, 12/01/40. |
| (12) | Non-income producing; issuer has not declared an ex-dividend date within the past twelve months. |
| (13) | Adjustable Rate MuniFund Term Preferred Shares, net of deferred offering cost as a percentage of Total Investments is 21.4%. |
| (14) | Other assets less liabilities includes the unrealized appreciation (depreciation) of certain over-the-counter ("OTC") derivatives as well as the OTC cleared and exchange-traded derivatives, when applicable. The unrealized appreciation (depreciation) of OTC cleared and exchange-traded derivatives is recognized as part of the cash collateral at brokers and/or the receivable or payable for variation margin as presented on the Statement of Assets and Liabilities, when applicable. |
| 12MTA | Federal Reserve U.S. 12-Month Cumulative Treasury Average 1-Year CMT. |
| 144A | Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers. |
| AMT | Alternative Minimum Tax |
| ETM | Escrowed to maturity |
| IF | Inverse floating rate security issued by a tender option bond (“TOB”) trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association (SIFMA) short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. |
| UB | Underlying bond of an inverse floating rate trust reflected as a financing transaction. |
| WI/DD | Purchased on a when-issued or delayed delivery basis. |
See accompanying notes to financial statements.
36
| NIQ | Nuveen Intermediate Duration Quality |
| Municipal Term Fund | |
| Portfolio of Investments | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| LONG-TERM INVESTMENTS – 127.0% (100.0% of Total Investments) | ||||
| MUNICIPAL BONDS – 123.4% (97.2% of Total Investments) | ||||
| Alabama – 2.0% (1.5% of Total Investments) | ||||
| $ 2,000 | Alabama Federal Aid Highway Finance Authority, Federal Highway Grant Anticipation | 9/22 at 100.00 | AA (5) | $ 2,091,720 |
| Revenue Bonds, Tender Option Bond Trust 2016-XL0024, 19.337%, 9/01/26, (Pre-refunded | ||||
| 9/01/22), 144A, (IF) (4) | ||||
| 1,000 | Lower Alabama Gas District, Alabama, Gas Project Revenue Bonds, Series 2016A, | No Opt. Call | A2 | 1,099,440 |
| 5.000%,9/01/34 | ||||
| 248 | Tuscaloosa County Industrial Development Authority, Alabama, Gulf Opportunity Zone | 5/29 at 100.00 | N/R | 251,522 |
| Bonds, Hunt Refining Project, Refunding Series 2019A, 4.500%, 5/01/32, 144A 2021 2021 | ||||
| 3,248 | Total Alabama | 3,442,682 | ||
| Alaska – 0.3% (0.2% of Total Investments) | ||||
| 500 | Northern Tobacco Securitization Corporation, Alaska, Tobacco Settlement Asset-Backed | No Opt. Call | A | 556,060 |
| Bonds, Senior Series 2021A Class 1, 5.000%, 6/01/30 | ||||
| Arizona – 2.3% (1.8% of Total Investments) | ||||
| Arizona Health Facilities Authority, Hospital Revenue Bonds, Phoenix Children’s | ||||
| Hospital, Series 2013D: | ||||
| 965 | 5.000%, 2/01/24 | 2/23 at 100.00 | AA– | 986,114 |
| 1,065 | 5.000%, 2/01/26 | 2/23 at 100.00 | AA– | 1,085,427 |
| 775 | Phoenix Civic Improvement Corporation, Arizona, Water System Revenue Bonds, Junior Lien | 7/31 at 100.00 | AAA | 900,410 |
| Series 2021A, 5.000%, 7/01/45 | ||||
| 1,000 | Tempe, Arizona, Water and Sewer Revenue Bonds, Series 2021, 5.000%, 7/01/41 | 7/31 at 100.00 | AA+ | 1,162,990 |
| 3,805 | Total Arizona | 4,134,941 | ||
| California – 11.0% (8.6% of Total Investments) | ||||
| 3,000 | Alameda Corridor Transportation Authority, California, Revenue Bonds, Refunding Senior | 10/23 at 100.00 | AA | 3,124,830 |
| Lien Series 2013A, 5.000%, 10/01/27 – AGM Insured | ||||
| 55 | California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, | 6/30 at 100.00 | BBB+ | 55,186 |
| Los Angeles County Securitization Corporation, Series 2020A, 4.000%, 6/01/49 | ||||
| 500 | California Health Facilities Financing Authority, California, Revenue Bonds, Sutter | 11/27 at 100.00 | A1 | 540,085 |
| Health, Refunding Series 2017A, 5.000%, 11/15/36 | ||||
| 2,170 | California Municipal Finance Authority, Revenue Bonds, Linxs APM Project, Senior Lien | 6/28 at 100.00 | BBB– | 2,267,997 |
| Series 2018A, 5.000%, 12/31/43, (AMT) | ||||
| 370 | California Pollution Control Financing Authority, Water Furnishing Revenue Bonds, San | 1/29 at 100.00 | BBB | 388,585 |
| Diego County Water Authority Desalination Project Pipeline, Refunding Series 2019, 5.000%, | ||||
| 11/21/45, 144A | ||||
| 1,930 | California Statewide Communities Development Authority, California, Revenue Bonds, Loma | 12/24 at 100.00 | BB | 1,989,039 |
| Linda University Medical Center, Series 2014A, 5.250%, 12/01/34 | ||||
| 3,335 | Eastern Municipal Water District Financing Authority, California, Water and Wastewater | 7/27 at 100.00 | AA+ | 3,691,278 |
| Revenue Bonds, Series 2017D, 5.250%, 7/01/42 | ||||
| 205 | Independent Cities Finance Authority, California, Mobile Home Park Revenue Bonds, | No Opt. Call | A– | 208,190 |
| Rancho Vallecitos Mobile Home Park, Series 2013, 4.500%, 4/15/23 | ||||
| Jurupa Community Services District, California, Special Tax Bonds, Community Facilities | ||||
| District 31 Eastvale Area, Series 2013: | ||||
| 150 | 4.000%, 9/01/25 | 9/22 at 100.00 | N/R | 151,036 |
| 305 | 4.000%, 9/01/26 | 9/22 at 100.00 | N/R | 307,108 |
| 250 | 4.000%, 9/01/27 | 9/22 at 100.00 | N/R | 251,728 |
| Los Angeles Department of Water and Power, California, Waterworks Revenue Bonds, | ||||
| Series 2021B: | ||||
| 300 | 5.000%, 7/01/28 | No Opt. Call | Aa2 | 345,879 |
| 700 | 5.000%, 7/01/29 | No Opt. Call | Aa2 | 818,902 |
37
| NIQ | Nuveen Intermediate Duration Quality Municipal |
| Term Fund | |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| California (continued) | ||||
| $ 1,765 | Patterson Public Finance Authority, California, Revenue Bonds, Community Facilities | No Opt. Call | N/R | $ 1,778,996 |
| District 2001-1, Senior Series 2013A, 5.000%, 9/01/22 | ||||
| 185 | Riverside County Redevelopment Agency, California, Tax Allocation Housing Bonds, Series | No Opt. Call | A (5) | 209,766 |
| 2011A, 8.000%, 10/01/26, (ETM) | ||||
| 1,500 | San Diego Association of Governments, California, South Bay Expressway Toll Revenue | 7/27 at 100.00 | A | 1,651,500 |
| Bonds, First Senior Lien Series 2017A, 5.000%, 7/01/36 | ||||
| 1,400 | San Joaquin County Transportation Authority, California, Sales Tax Revenue, Limited Tax | 3/27 at 100.00 | AA | 1,546,440 |
| Measure K Series 2017, 5.000%, 3/01/32 | ||||
| 18,120 | Total California | 19,326,545 | ||
| Colorado – 12.4% (9.7% of Total Investments) | ||||
| 3,045 | Colorado Health Facilities Authority, Colorado, Revenue Bonds, CommonSpirit Health, | 8/29 at 100.00 | BBB+ | 3,302,059 |
| Series 2019A-2, 5.000%, 8/01/30 | ||||
| 5,000 | Colorado Springs, Colorado, Utilities System Revenue Bonds, Refunding Series 2017A-2, | 11/27 at 100.00 | AA+ | 5,548,850 |
| 5.000%, 11/15/47 | ||||
| Colorado State Board of Governors, Colorado State University Auxiliary Enterprise System | ||||
| Revenue Bonds, Tender Option Bond Trust 2016-XF2354: | ||||
| 100 | 20.029%, 3/01/25, 144A, (IF) (4) | No Opt. Call | AA | 138,460 |
| 300 | 20.029%, 3/01/26, 144A, (IF) (4) | No Opt. Call | AA | 446,085 |
| 430 | 19.985%, 3/01/27, 144A, (IF) (4) | No Opt. Call | AA | 681,219 |
| 725 | 20.029%, 3/01/28, 144A, (IF) (4) | No Opt. Call | AA | 1,211,968 |
| 200 | 20.029%, 3/01/29, 144A, (IF) (4) | No Opt. Call | AA | 350,536 |
| 1,870 | Denver Convention Center Hotel Authority, Colorado, Revenue Bonds, Convention Center | 12/26 at 100.00 | Baa2 | 1,984,388 |
| Hotel, Refunding Senior Lien Series 2016, 5.000%, 12/01/30 | ||||
| 1,000 | Public Authority for Colorado Energy, Natural Gas Purchase Revenue Bonds, Colorado | No Opt. Call | AA– | 1,310,230 |
| Springs Utilities, Series 2008, 6.500%, 11/15/38 | ||||
| 2,280 | University of Colorado, Enterprise System Revenue Bonds, Refunding Series 2019B, | 6/29 at 100.00 | N/R | 2,554,124 |
| 5.000%, 6/01/44 | ||||
| 4,000 | University of Northern Colorado at Greeley, Institutional Enterprise System Revenue | 6/26 at 100.00 | Aa2 | 4,250,040 |
| Bonds, Refunding Series 2016A, 5.000%, 6/01/46 | ||||
| 18,950 | Total Colorado | 21,777,959 | ||
| District of Columbia – 3.9% (3.1% of Total Investments) | ||||
| 1,900 | Metropolitan Washington Airports Authority, District of Columbia, Dulles Toll Road | 10/29 at 100.00 | A– | 2,015,349 |
| Revenue Bonds, Dulles Metrorail & Capital improvement Projects, Refunding & Subordinate Lien | ||||
| Series 2019B, 5.000%, 10/01/47 | ||||
| 4,000 | Metropolitan Washington Airports Authority, District of Columbia, Dulles Toll Road | 10/31 at 100.00 | N/R | 4,019,400 |
| Revenue Bonds, Dulles Metrorail & Capital Improvement Projects, Refunding Second Senior | ||||
| Lien Series 2022A, 4.000%, 10/01/52 – AGM Insured | ||||
| 720 | Washington Metropolitan Area Transit Authority, District of Columbia, Dedicated Revenue | 7/31 at 100.00 | AA | 832,176 |
| Bonds, Green Series 2021A, 5.000%, 7/15/41 | ||||
| 6,620 | Total District of Columbia | 6,866,925 | ||
| Florida – 5.6% (4.4% of Total Investments) | ||||
| 150 | Atlantic Beach, Florida, Healthcare Facilities Revenue Refunding Bonds, Fleet Landing | No Opt. Call | BBB | 154,750 |
| Project, Series 2013A, 5.000%, 11/15/23 | ||||
| 250 | Belmont Community Development District, Florida, Capital Improvement Revenue Bonds, | No Opt. Call | N/R | 254,413 |
| Phase 1 Project, Series 2013A, 5.500%, 11/01/23 | ||||
| 825 | Broward County, Florida, Half-Cent Sales Tax Revenue Bonds, Refunding Series 2020, | 10/30 at 100.00 | AA+ | 863,635 |
| 4.000%, 10/01/40 | ||||
| 1,270 | Brwoard County, Florida, Fuel System Revenue Bonds, Fort Lauderdale Fuel Facilities LLC | No Opt. Call | AA (5) | 1,305,154 |
| Project, Series 2013A, 5.000%, 4/01/23 – AGM Insured, (AMT), (ETM) | ||||
| 1,740 | Cape Coral, Florida, Water and Sewer Revenue Bonds, Refunding Series 2017, | 10/27 at 100.00 | A+ | 1,923,622 |
| 5.000%, 10/01/33 |
38
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Florida (continued) | ||||
| $ 310 | Capital Trust Agency, Florida, Fixed Rate Air Cargo Revenue Refunding Bonds, Aero Miami | 7/22 at 100.00 | Baa3 | $ 310,477 |
| FX, LLC Project, Series 2010A, 5.350%, 7/01/29 | ||||
| 545 | Central Florida Expressway Authority, Revenue Bonds, Senior Lien Series 2021D, | No Opt. Call | A+ | 637,808 |
| 5.000%, 7/01/31 | ||||
| 350 | Collier County Educational Facilities Authority, Florida, Revenue Bonds, Ave Maria | No Opt. Call | BBB– | 353,388 |
| University, Refunding Series 2013A, 4.500%, 6/01/23 | ||||
| 1,000 | Florida Mid-Bay Bridge Authority, Revenue Bonds, 1st Senior Lien Series 2015A, | No Opt. Call | BBB+ | 1,035,310 |
| 5.000%, 10/01/23 | ||||
| 500 | Gainesville, Florida, Utilities System Revenue Bonds, Series 2017A, 5.000%, 10/01/37 | 10/27 at 100.00 | Aa3 | 554,940 |
| 1,400 | Palm Beach County Health Facilities Authority, Florida, Revenue Bonds, Jupiter Medical | No Opt. Call | BBB+ | 1,419,558 |
| Center, Series 2013A, 5.000%, 11/01/22 | ||||
| 510 | Putnam County Development Authority, Florida, Pollution Control Revenue Bonds, Seminole | 5/28 at 100.00 | A– | 563,178 |
| Electric Cooperatice, Inc. Project, Refunding Series 2018B, 5.000%, 3/15/42 | ||||
| 305 | Southeast Overtown/Park West Community Redevelopment Agency, Florida, Tax Increment | No Opt. Call | BBB+ | 319,301 |
| Revenue Bonds, Series 2014A-1, 5.000%, 3/01/24, 144A | ||||
| 190 | Verandah West Community Development District, Florida, Capital Improvement Revenue | No Opt. Call | N/R | 190,705 |
| Bonds, Refunding Series 2013, 4.000%, 5/01/23 | ||||
| 9,345 | Total Florida | 9,886,239 | ||
| Georgia – 2.6% (2.1% of Total Investments) | ||||
| 1,025 | Atlanta, Georgia, Tax Allocation Bonds, Perry Bolton Project Series 2014, | No Opt. Call | A– | 1,027,255 |
| 4.000%, 7/01/22 | ||||
| 1,000 | Gainesville and Hall County Hospital Authority, Georgia, Revenue Anticipation | 2/27 at 100.00 | AA | 1,078,390 |
| Certificates, Northeast Georgia Health Services Inc., Series 2017B, 5.500%, 2/15/42 | ||||
| 1,000 | Geo. L. Smith II Georgia World Congress Center Authority, Georgia, Convention Center | 1/31 at 100.00 | BBB– | 910,340 |
| Hotel Revenue Bonds, First Tier Series 2021A, 4.000%, 1/01/54 | ||||
| 1,465 | Municipal Electric Authority of Georgia, General Resolution Projects Subordinated Bonds, | 1/28 at 100.00 | A1 | 1,569,572 |
| Series 20188HH, 5.000%, 1/01/44 | ||||
| 4,490 | Total Georgia | 4,585,557 | ||
| Hawaii – 1.9% (1.5% of Total Investments) | ||||
| 3,000 | Honolulu City and County, Hawaii, Wastewater System Revenue Bonds, First Bond | 1/28 at 100.00 | Aa2 | 3,339,060 |
| Resolution, Senior Series 2018A, 5.000%, 7/01/37 | ||||
| Illinois – 11.1% (8.7% of Total Investments) | ||||
| 500 | Cook County, Illinois, General Obligation Bonds, Refunding Series 2021A, 5.000%, 11/15/31 | 11/30 at 100.00 | A+ | 565,390 |
| 2,500 | Cook County, Illinois, General Obligation Bonds, Tender Option Bond Trust 2015-XF1007, | 11/22 at 100.00 | A+ | 2,644,500 |
| 15.635%, 11/15/25, 144A, (IF) (4) | ||||
| 4,000 | Illinois Municipal Electric Agency, Power Supply System Revenue Bonds, Refunding Series | 8/25 at 100.00 | A1 | 4,331,440 |
| 2015A, 5.000%, 2/01/27 | ||||
| 2,500 | Illinois State, General Obligation Bonds, November Series 2017D, 5.000%, 11/01/27 | No Opt. Call | BBB | 2,736,300 |
| 5,000 | Illinois State, General Obligation Bonds, Series 2013, 5.000%, 7/01/23 | No Opt. Call | BBB | 5,155,150 |
| 290 | Madison, Macoupin, Jersey, Calhoun, Morgan, Scott, and Greene Counties Community College | 11/26 at 100.00 | AA | 317,138 |
| District 536, Illinois, General Obligation Bonds, Lewis & Clark Community College, Refunding | ||||
| Series 2017A, 5.000%, 11/01/33 – AGM Insured | ||||
| 665 | Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project | 12/31 at 100.00 | BBB+ | 625,300 |
| Bonds, Refunding Series 2022A, 4.000%, 6/15/52 | ||||
| 1,000 | Southwestern Illinois Development Authority, Local Government Revenue Bonds, Edwardsville | No Opt. Call | AA | 990,130 |
| Community Unit School District 7 Project, Series 2007, 0.000%, 12/01/22 – AGM Insured | ||||
| 2,000 | Springfield, Illinois, Electric Revenue Bonds, Refunding Senior Lien Series 2015, | 3/25 at 100.00 | A | 2,135,580 |
| 5.000%, 3/01/33 | ||||
| 18,455 | Total Illinois | 19,500,928 |
39
| NIQ | Nuveen Intermediate Duration Quality Municipal |
| Term Fund | |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Indiana – 1.4% (1.1% of Total Investments) | ||||
| $ 930 | Indiana Finance Authority, Educational Facilities Revenue Bonds, 21st Century Charter | 3/23 at 100.00 | B+ | $ 930,698 |
| School Project, Series 2013A, 6.000%, 3/01/33 | ||||
| 1,500 | Indiana Finance Authority, Lease Appropriation Bonds, Stadium Project, Refunding Series | No Opt. Call | AA+ | 1,607,520 |
| 2015A, 5.000%, 2/01/25 | ||||
| 2,430 | Total Indiana | 2,538,218 | ||
| Kentucky – 3.6% (2.9% of Total Investments) | ||||
| 1,000 | Kentucky Bond Development Corporation, Transient Room Tax Revenue Bonds, Lexington | 9/28 at 100.00 | A2 | 1,108,850 |
| Center Corporation Project, Series 2018A, 5.000%, 9/01/43 | ||||
| Kentucky Economic Development Finance Authority, Revenue Bonds, Next Generation Kentucky | ||||
| Information Highway Project, Senior Series 2015A: | ||||
| 925 | 4.250%, 7/01/35 | 7/25 at 100.00 | BBB+ | 942,631 |
| 1,400 | 5.000%, 1/01/45 | 7/25 at 100.00 | BBB+ | 1,453,368 |
| 3,000 | Kentucky Public Transportation Infrastructure Authority, Toll Revenue Bonds, Downtown | No Opt. Call | Baa2 | 2,917,080 |
| Crossing Project, Capital Appreciation First Tier Series 2013B, 0.000%, 7/01/23 | ||||
| 6,325 | Total Kentucky | 6,421,929 | ||
| Louisiana – 0.9% (0.7% of Total Investments) | ||||
| 530 | New Orleans Aviation Board, Louisiana, Special Facility Revenue Bonds, Parking Facilities | 10/28 at 100.00 | AA | 567,582 |
| Corporation Consolidated Garage System, Series 2018A, 5.000%, 10/01/43 – AGM Insured | ||||
| 1,000 | New Orleans, Louisiana, Water Revenue Bonds, Refunding Series 2014, 5.000%, 12/01/22 | No Opt. Call | A– | 1,017,050 |
| 1,530 | Total Louisiana | 1,584,632 | ||
| Maine – 2.9% (2.3% of Total Investments) | ||||
| 1,000 | Maine Health and Higher Educational Facilities Authority Revenue Bonds, Eastern Maine | 7/23 at 100.00 | BBB (5) | 1,035,440 |
| Medical Center Obligated Group Issue, Series 2013, 5.000%, 7/01/33, (Pre-refunded 7/01/23) | ||||
| Maine Health and Higher Educational Facilities Authority Revenue Bonds, MaineHealth | ||||
| Issue, Series 2018A: | ||||
| 435 | 5.000%, 7/01/43 | 7/28 at 100.00 | A+ | 463,062 |
| 565 | 5.000%, 7/01/48 | 7/28 at 100.00 | A+ | 598,154 |
| Maine Turnpike Authority, Special Obligation Bonds, Series 2014: | ||||
| 620 | 5.000%, 7/01/25 | 7/24 at 100.00 | A+ | 656,958 |
| 340 | 5.000%, 7/01/27 | 7/24 at 100.00 | A+ | 359,696 |
| 1,850 | 5.000%, 7/01/29 | 7/24 at 100.00 | A+ | 1,957,171 |
| 4,810 | Total Maine | 5,070,481 | ||
| Maryland – 0.5% (0.4% of Total Investments) | ||||
| 615 | Baltimore, Maryland, Convention Center Hotel Revenue Bonds, Refunding Series 2017, | 9/27 at 100.00 | CCC | 617,866 |
| 5.000%, 9/01/34 | ||||
| 310 | Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Frederick | No Opt. Call | A– | 310,818 |
| Memorial Hospital Issue, Series 2012A, 5.000%, 7/01/22 | ||||
| 925 | Total Maryland | 928,684 | ||
| Massachusetts – 0.6% (0.4% of Total Investments) | ||||
| Massachusetts Development Finance Agency, Revenue Bonds, Boston Medical Center Issue, | ||||
| Series 2012C: | ||||
| 500 | 5.000%, 7/01/29, (Pre-refunded 7/01/22) | 7/22 at 100.00 | Baa2 (5) | 501,560 |
| 420 | 5.000%, 7/01/29 | 7/22 at 100.00 | BBB | 421,105 |
| 80 | 5.000%, 7/01/29, (Pre-refunded 7/01/22) | 7/22 at 100.00 | N/R (5) | 80,249 |
| 1,000 | Total Massachusetts | 1,002,914 | ||
| Michigan – 8.4% (6.7% of Total Investments) | ||||
| 1,000 | Detroit City School District, Wayne County, Michigan, General Obligation Bonds, Tender | No Opt. Call | Aa1 | 1,932,370 |
| Option Bond Trust 3308, 20.486%, 5/01/30 – AGM Insured, 144A, (IF) (4) | ||||
| 5 | Detroit, Michigan, Sewer Disposal System Revenue Bonds, Second Lien, Series 2006B, | 7/22 at 100.00 | A+ | 5,015 |
| 5.000%, 7/01/36 – FGIC Insured |
40
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Michigan (continued) | ||||
| $ 5 | Detroit, Michigan, Water Supply System Revenue Bonds, Second Lien Series 2003B, 5.000%, | 7/22 at 100.00 | A+ | $ 5,016 |
| 7/01/34 – NPFG Insured | ||||
| 190 | Flint Hospital Building Authority, Michigan, Building Authority Revenue Bonds, Hurley | No Opt. Call | BBB– | 192,888 |
| Medical Center, Series 2013A, 5.000%, 7/01/23 | ||||
| 2,325 | Michigan Finance Authority, Distributable State Aid Revenue Bonds, Charter County of | 11/30 at 100.00 | AA | 2,474,172 |
| Wayne, Second Lien Refunding Series 2020, 4.000%, 11/01/36 | ||||
| 3,000 | Michigan Finance Authority, Local Government Loan Program Revenue Bonds, Detroit Water & | No Opt. Call | AA | 3,105,330 |
| Sewerage Department Water Supply System Local Project, Refunding Senior Loan Series 2014D-1, | ||||
| 5.000%, 7/01/23 – AGM Insured | ||||
| 1,210 | Michigan Finance Authority, Tobacco Settlement Asset- Backed Bonds, 2007 Sold Tobacco | 12/30 at 100.00 | BBB– | 1,267,112 |
| Receipts, Series 2020B-1-CL2, 5.000%, 6/01/49 | ||||
| 1,500 | Michigan State Building Authority, Revenue Bonds, Facilities Program, Refunding Series | 10/29 at 100.00 | Aa2 | 1,709,070 |
| 2019-I, 5.000%, 4/15/36 | ||||
| 4,000 | Michigan State, Trunk Line Fund Bonds, Rebuilding Michigan Program, Series 2021A, | 11/31 at 100.00 | N/R | 4,195,680 |
| 4.000%, 11/15/40 | ||||
| 13,235 | Total Michigan | 14,886,653 | ||
| Minnesota – 1.1% (0.9% of Total Investments) | ||||
| 2,000 | Duluth Economic Development Authority, Minnesota, Health Care Facilities Revenue Bonds, | 2/28 at 100.00 | A– | 2,019,980 |
| Essentia Health Obligated Group, Series 2018A, 4.250%, 2/15/43 | ||||
| Missouri – 1.7% (1.4% of Total Investments) | ||||
| 3,000 | Missouri Joint Municipal Electric Utility Commission, Power Project Revenue Bonds, Plum | No Opt. Call | A | 3,061,110 |
| Point Project, Refunding Series 2014A, 5.000%, 1/01/23 | ||||
| Montana – 1.4% (1.1% of Total Investments) | ||||
| Montana Facility Finance Authority, Healthcare Facility Revenue Bonds, Kalispell | ||||
| Regional Medical Center, Series 2018B: | ||||
| 985 | 5.000%, 7/01/28 | No Opt. Call | BBB | 1,087,903 |
| 1,270 | 5.000%, 7/01/29 | 7/28 at 100.00 | BBB | 1,393,253 |
| 2,255 | Total Montana | 2,481,156 | ||
| Nebraska – 1.7% (1.4% of Total Investments) | ||||
| 3,000 | Central Plains Energy Project, Nebraska, Gas Project 3 Revenue Bonds, Series 2012, | 9/22 at 100.00 | A2 | 3,023,940 |
| 5.000%, 9/01/32 | ||||
| Nevada – 2.5% (2.0% of Total Investments) | ||||
| 515 | Carson City, Nevada, Hospital Revenue Bonds, Carson Tahoe Regional Healthcare Project, | 9/27 at 100.00 | A– | 541,759 |
| Series 2017A, 5.000%, 9/01/47 | ||||
| 1,000 | Las Vegas Convention and Visitors Authority, Nevada, Revenue Bonds, Series 2018C, | 7/28 at 100.00 | Aa3 | 1,124,120 |
| 5.250%, 7/01/43 | ||||
| Las Vegas Redevelopment Agency, Nevada, Tax Increment Revenue Bonds, Refunding Series 2016: | ||||
| 1,295 | 5.000%, 6/15/26 | No Opt. Call | BBB+ | 1,396,321 |
| 1,210 | 5.000%, 6/15/27 | 6/26 at 100.00 | BBB+ | 1,301,004 |
| 4,020 | Total Nevada | 4,363,204 | ||
| New Jersey – 2.8% (2.2% of Total Investments) | ||||
| New Jersey Economic Development Authority, Private Activity Bonds, The Goethals Bridge | ||||
| Replacement Project, Series 2013: | ||||
| 500 | 5.000%, 7/01/22, (AMT) | No Opt. Call | A2 | 501,025 |
| 620 | 5.000%, 1/01/23, (AMT) | No Opt. Call | A2 | 628,860 |
| 1,000 | New Jersey Economic Development Authority, School Facilities Construction Financing | 3/25 at 100.00 | Baa1 | 1,059,430 |
| Program Bonds, Tender Option Bond Trust 2016-XF2340, 3.622%, 9/01/25, 144A, (IF) (4) | ||||
| 1,000 | New Jersey Economic Development Authority, Special Facilities Revenue Bonds, Continental | 8/22 at 101.00 | Ba3 | 1,007,140 |
| Airlines Inc., Series 1999, 5.250%, 9/15/29, (AMT) | ||||
| 1,225 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series | 12/30 at 100.00 | Baa1 | 1,202,411 |
| 2020AA, 4.000%, 6/15/50 |
41
| NIQ | Nuveen Intermediate Duration Quality Municipal |
| Term Fund | |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| New Jersey (continued) | ||||
| $ 450 | Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed | 6/28 at 100.00 | BB+ | $ 462,901 |
| Bonds, Series 2018B, 5.000%, 6/01/46 | ||||
| 4,795 | Total New Jersey | 4,861,767 | ||
| New York – 9.5% (7.5% of Total Investments) | ||||
| 495 | Buffalo and Erie County Industrial Land Development Corporation, New York, Revenue | 7/25 at 100.00 | BBB | 508,202 |
| Bonds, Catholic Health System, Inc. Project, Series 2015, 5.000%, 7/01/29 | ||||
| 750 | Buffalo Sewer Authority, New York, Sewer System Environmental Impact Revenue Bonds, | 6/28 at 100.00 | A+ | 757,852 |
| Green Series 2021, 4.000%, 6/15/51 | ||||
| 500 | Dormitory Authority of the State of New York, Revenue Bonds, School Districts Financing | 10/29 at 100.00 | AA | 577,815 |
| Program, Series 2021A, 5.000%, 10/01/32 – AGM Insured | ||||
| 435 | Liberty Development Corporation, New York, Goldman Sachs Headquarters Revenue Bonds | No Opt. Call | A2 | 531,827 |
| Series 2007, 5.500%, 10/01/37 | ||||
| 3,545 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series | 9/27 at 100.00 | A | 3,914,105 |
| 2017, 5.000%, 9/01/42 | ||||
| 1,390 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Green | 5/30 at 100.00 | A3 | 1,476,958 |
| Climate Bond Certified Series 2020C-1, 5.000%, 11/15/50 | ||||
| 750 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Refunding | No Opt. Call | A3 | 833,760 |
| Green Climate Certified Series 2020E, 5.000%, 11/15/30 | ||||
| 880 | New York City Industrial Development Agency, New York, PILOT Payment in Lieu of Taxes | No Opt. Call | AA | 964,049 |
| Revenue Bonds, Queens Baseball Stadium Project, Refunding Series 2021A, 5.000%, 1/01/27 – | ||||
| AGM Insured | ||||
| 710 | New York City, New York, General Obligation Bonds, Fiscal 2021 Series C, 5.000%, 8/01/43 | 8/30 at 100.00 | AA | 794,057 |
| 2,000 | New York Convention Center Development Corporation, New York, Revenue Bonds, Hotel Unit | No Opt. Call | A2 | 2,175,000 |
| Fee Secured, Refunding Series 2015, 5.000%, 11/15/25 | ||||
| 1,000 | New York State Power Authority, General Revenue Bonds, Series 2020A, 4.000%, 11/15/50 | 5/30 at 100.00 | AA | 1,013,510 |
| 1,500 | Suffolk Tobacco Asset Securitization Corporation, New York, Tobacco Settlement | No Opt. Call | N/R | 1,670,400 |
| Asset-Backed Bonds, Senior Series 2021A-2, 5.000%, 6/01/30 | ||||
| 560 | Triborough Bridge and Tunnel Authority, New York, General Revenue Bonds, MTA Bridges & | No Opt. Call | A1 | 611,397 |
| Tunnels, Series 2021A, 5.000%, 11/01/25 | ||||
| 1,000 | Triborough Bridge and Tunnel Authority, New York, Payroll Mobility Tax Bonds, Refunding | No Opt. Call | AA+ | 960,100 |
| Senior Lien Subseries 2021A-2, 2.000%, 5/15/45, (Mandatory Put 5/15/28) | ||||
| 15,515 | Total New York | 16,789,032 | ||
| North Dakota – 0.7% (0.6% of Total Investments) | ||||
| 1,250 | Cass County, North Dakota, Health Care Facilities Revenue Bonds, Essential Health | 2/28 at 100.00 | A– | 1,262,488 |
| Obligated Group, Series 2018B, 4.250%, 2/15/43 | ||||
| Ohio – 3.5% (2.8% of Total Investments) | ||||
| 620 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed | 6/30 at 100.00 | BBB+ | 600,495 |
| Revenue Bonds, Refunding Senior Lien Series 2020A-2 Class 1, 4.000%, 6/01/48 | ||||
| 4,335 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed | 6/30 at 100.00 | N/R | 4,403,493 |
| Revenue Bonds, Refunding Senior Lien Series 2020B-2 Class 2, 5.000%, 6/01/55 | ||||
| 3,000 | Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, | No Opt. Call | N/R | 3,750 |
| FirstEnergy Generation Project, Refunding Series 2006A, 3.750%, 12/01/23 (6) | ||||
| 1,150 | Ohio State, Private Activity Bonds, Portsmouth Gateway Group, LLC – Borrower, Portsmouth | 6/25 at 100.00 | AA | 1,230,557 |
| Bypass Project, Series 2015, 5.000%, 12/31/27 – AGM Insured, (AMT) | ||||
| 9,105 | Total Ohio | 6,238,295 | ||
| Oklahoma – 0.1% (0.1% of Total Investments) | ||||
| 255 | Oklahoma Development Finance Authority, Health System Revenue Bonds, OU Medicine | 8/28 at 100.00 | Baa3 | 260,786 |
| Project, Series 2018B, 5.250%, 8/15/43 |
42
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Oregon – 1.8% (1.4% of Total Investments) | ||||
| $ 965 | Astoria Hospital Facilities Authority, Oregon, Hospital Revenue and Refunding Bonds, | No Opt. Call | A– | $ 970,896 |
| Columbia Memorial Hospital, Series 2012, 5.000%, 8/01/22 | ||||
| 2,000 | Port of Portland, Oregon, International Airport Revenue Bonds, Series 2017-24B, 5.000%, | 1/27 at 100.00 | A+ | 2,132,860 |
| 7/01/36, (AMT) | ||||
| 2,965 | Total Oregon | 3,103,756 | ||
| Pennsylvania – 2.1% (1.6% of Total Investments) | ||||
| 520 | Erie Higher Education Building Authority, Pennsylvania, Revenue Bonds, Gannon University | No Opt. Call | BBB+ | 527,472 |
| Project, Series 2013, 4.000%, 5/01/23 | ||||
| 1,700 | Pennsylvania Economic Development Financing Authority, Private Activity Revenue Bonds, | 6/26 at 100.00 | BBB | 1,796,662 |
| Pennsylvania Rapid Bridge Replacement Project, Series 2015, 5.000%, 6/30/28, (AMT) | ||||
| 1,000 | Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, Subordinate Series 2021A, | 12/30 at 100.00 | A | 994,140 |
| 4.000%, 12/01/43 | ||||
| 285 | Pittsburgh Water and Sewer Authority, Pennsylvania, Water and Sewer System Revenue | 9/29 at 100.00 | AA | 301,590 |
| Bonds, Refunding Subordinate Series 2019B, 4.000%, 9/01/34 – AGM Insured | ||||
| 3,505 | Total Pennsylvania | 3,619,864 | ||
| Puerto Rico – 1.6% (1.3% of Total Investments) | ||||
| Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Restructured | ||||
| 2018A-1: | ||||
| 660 | 4.500%, 7/01/34 | 7/25 at 100.00 | N/R | 675,530 |
| 2,175 | 4.550%, 7/01/40 | 7/28 at 100.00 | N/R | 2,203,166 |
| 2,835 | Total Puerto Rico | 2,878,696 | ||
| South Carolina – 2.6% (2.1% of Total Investments) | ||||
| 1,000 | Piedmont Municipal Power Agency, South Carolina, Electric Revenue Bonds, Refunding | No Opt. Call | A– | 1,041,730 |
| Series 2021A, 4.000%, 1/01/25 | ||||
| 1,500 | Piedmont Municipal Power Agency, South Carolina, Electric Revenue Bonds, Refunding | No Opt. Call | N/R | 1,603,110 |
| Series 2021D, 4.000%, 1/01/31 | ||||
| 1,758 | South Carolina Public Service Authority, Santee Cooper Revenue Obligations, Refunding | No Opt. Call | N/R | 2,013,596 |
| Series 2022B, 5.000%, 12/01/31 | ||||
| 4,258 | Total South Carolina | 4,658,436 | ||
| Tennessee – 10.3% (8.1% of Total Investments) | ||||
| Greeneville Health and Educational Facilities Board, Tennessee, Hospital Revenue Bonds, | ||||
| Ballad Health, Series 2018A: | ||||
| 1,000 | 5.000%, 7/01/36 | 7/28 at 100.00 | A | 1,074,120 |
| 1,605 | 5.000%, 7/01/37 | 7/28 at 100.00 | A | 1,722,342 |
| Jackson, Tennessee, Hospital Revenue Bonds, Jackson-Madison County General Hospital | ||||
| Project, Series 2018A: | ||||
| 2,180 | 5.000%, 4/01/35 | 10/28 at 100.00 | N/R | 2,350,236 |
| 110 | 5.000%, 4/01/35, (Pre-refunded 10/01/28) | 10/28 at 100.00 | N/R (5) | 126,227 |
| Knox County Health, Educational and Housing Facility Board, Tennessee, Hospital Revenue | ||||
| Bonds, Covenant Health, Refunding Series 2012A: | ||||
| 1,440 | 5.000%, 1/01/25 | 1/23 at 100.00 | A+ | 1,460,664 |
| 2,170 | 5.000%, 1/01/26 | 1/23 at 100.00 | A+ | 2,200,141 |
| 2,000 | Metropolitan Government of Nashville-Davidson County Health and Educational Facilities | 5/31 at 100.00 | N/R | 2,007,280 |
| Board, Tennessee, Revenue Bonds, Belmont University, Refunding & Improvement Series 2021, | ||||
| 4.000%, 5/01/46 | ||||
| 450 | Metropolitan Government of Nashville-Davidson County, Tennessee, Water and Sewerage | 7/27 at 100.00 | AA | 497,273 |
| Revenue Bonds, Green Series 2017A, 5.000%, 7/01/42 | ||||
| 1,400 | The Tennessee Energy Acquisition Corporation, Gas Revenue Bonds, Series 2006B, | |||
| 5.625%, 9/01/26 | No Opt. Call | BBB | 1,537,634 |
43
| NIQ | Nuveen Intermediate Duration Quality Municipal |
| Term Fund | |
| Portfolio of Investments (continued) | |
| May 31, 2022 |
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Tennessee (continued) | ||||
| The Tennessee Energy Acquisition Corporation, Gas Revenue Bonds, Series 2006C: | ||||
| $ 1,490 | 5.000%, 2/01/24 | No Opt. Call | A | $ 1,542,165 |
| 1,365 | 5.000%, 2/01/25 | No Opt. Call | A | 1,432,431 |
| 1,870 | West Wilson Utility District, Wilson County, Tennessee, Water Revenue Bonds, Improvement | 6/32 at 100.00 | N/R | 2,124,937 |
| Series 2022, 5.000%, 6/01/42, (WI/DD, Settling 6/10/22) | ||||
| 17,080 | Total Tennessee | 18,075,450 | ||
| Texas – 5.3% (4.2% of Total Investments) | ||||
| 1,225 | Bexar County Hospital District, Texas, Certificates of Obligation, Series 2020, 5.000%, 2/15/45 | 2/29 at 100.00 | Aa1 | 1,372,319 |
| 1,070 | Central Texas Regional Mobility Authority, Revenue Bonds, Refunding Subordinate Lien | 1/30 at 100.00 | BBB+ | 1,041,260 |
| Series 2020G, 4.000%, 1/01/45 | ||||
| 2,000 | Gulf Coast Industrial Development Authority, Texas, Solid Waste Disposal Revenue Bonds, | 10/22 at 100.00 | BB | 2,000,080 |
| Citgo Petroleum Corporation Project, Series 1995, 4.875%, 5/01/25, (AMT) | ||||
| Harris County-Houston Sports Authority, Texas, Revenue Bonds, Refunding Second Lien | ||||
| Series 2014C: | ||||
| 1,660 | 5.000%, 11/15/23 | No Opt. Call | Baa1 | 1,718,116 |
| 960 | 5.000%, 11/15/25 | 11/24 at 100.00 | Baa1 | 1,010,957 |
| 1,005 | Harris County-Houston Sports Authority, Texas, Revenue Bonds, Third Lien Series 2004A-3, | 11/24 at 59.10 | Baa2 | 539,494 |
| 0.000%, 11/15/33 – NPFG Insured | ||||
| Tarrant County Cultural Education Facilities Finance Corporation, Texas, Hospital | ||||
| Revenue Bonds, Scott & White Healthcare Project, Tender Option Bond Trust 2016-XG0058: | ||||
| 100 | 19.415%, 8/15/22, 144A, (IF) (4) | No Opt. Call | AA– | 103,815 |
| 155 | 19.240%, 8/15/24, (Pre-refunded 8/15/23), 144A, (IF) (4) | 8/23 at 100.00 | AA– (5) | 185,918 |
| 200 | 19.415%, 8/15/26, (Pre-refunded 8/15/23), 144A, (IF) (4) | 8/23 at 100.00 | AA– (5) | 240,284 |
| 175 | 19.205%, 8/15/27, (Pre-refunded 8/15/23), 144A, (IF) (4) | 8/23 at 100.00 | AA– (5) | 209,839 |
| 915 | Texas Municipal Gas Acquisition and Supply Corporation I, Gas Supply Revenue Bonds, | No Opt. Call | A2 | 985,327 |
| Senior Lien Series 2008D, 6.250%, 12/15/26 | ||||
| 9,465 | Total Texas | 9,407,409 | ||
| Utah – 0.7% (0.5% of Total Investments) | ||||
| 435 | Utah Water Finance Agency, Revenue Bonds, Pooled Loan Financing Program, Series 2017A, | 3/27 at 100.00 | AA | 481,819 |
| 5.000%, 3/01/35 | ||||
| 600 | Utah Water Finance Agency, Revenue Bonds, Pooled Loan Financing Program, Series 2017C, | 3/27 at 100.00 | AA+ | 664,578 |
| 5.000%, 3/01/34 | ||||
| 1,035 | Total Utah | 1,146,397 | ||
| Virgin Islands – 0.1% (0.0% of Total Investments) | ||||
| 100 | Virgin Islands Public Finance Authority, Gross Receipts Taxes Loan Note, Refunding | No Opt. Call | AA | 100,587 |
| Series 2012A, 4.000%, 10/01/22 – AGM Insured | ||||
| Virginia – 0.8% (0.6% of Total Investments) | ||||
| 1,340 | Chesapeake Bay Bridge and Tunnel District, Virginia, General Resolution Revenue Bonds, | 7/26 at 100.00 | AA | 1,425,666 |
| First Tier Series 2016, 5.000%, 7/01/41 – AGM Insured | ||||
| Washington – 1.4% (1.1% of Total Investments) | ||||
| 700 | Port of Seattle, Washington, Revenue Bonds, Intermediate Lien Series 2015A, 5.000%, 4/01/27 | 10/24 at 100.00 | AA– | 743,190 |
| 210 | Washington State Convention Center Public Facilities District, Lodging Tax Revenue | 7/31 at 100.00 | Baa1 | 210,262 |
| Bonds, Refunding Series2021B. Exchange Purchase, 4.000%, 7/01/34 | ||||
| 1,550 | Washington State Convention Center Public Facilities District, Lodging Tax Revenue | 7/31 at 100.00 | Baa3 | 1,423,117 |
| Bonds, Refunding Subordinate Series 2021B. Exchange Purchase, 4.000%, 7/01/43 | ||||
| 2,460 | Total Washington | 2,376,569 |
44
| Principal | Optional Call | |||
| Amount (000) | Description (1) | Provisions (2) | Ratings (3) | Value |
| Wisconsin – 0.3% (0.2% of Total Investments) | ||||
| University of Wisconsin Hospitals and Clinics Authority, Revenue Bonds, Tender Option | ||||
| Bond Trust 2015-XF0127: | ||||
| $ 100 | 19.200%, 4/01/23, 144A, (IF) (4) | No Opt. Call | AA– | $ 114,054 |
| 185 | 18.864%, 4/01/24, 144A, (IF) (4) | 4/23 at 100.00 | AA– | 210,508 |
| 100 | 19.200%, 4/01/25, 144A, (IF) (4) | 4/23 at 100.00 | AA– | 114,054 |
| 385 | Total Wisconsin | 438,616 | ||
| $ 207,411 | Total Municipal Bonds (cost $219,965,562) | 217,443,611 | ||
| Shares | Description (1) | Value | ||
| COMMON STOCKS – 3.6% (2.8% of Total Investments) | ||||
| Independent Power and Renewable Electricity Producers – 3.6% (2.8% of Total Investments) | ||||
| 97,015 | Energy Harbor Corp (7), (8), (9) | $ 6,349,632 | ||
| Total Common Stocks (cost $2,765,568) | 6,349,632 | |||
| Total Long-Term Investments (cost $222,731,130) | 223,793,243 | |||
| Adjustable Rate MuniFund Term Preferred Shares, net of deferred offering costs – (31.2)% (10) | (54,970,954) | |||
| Other Assets Less Liabilities – 4.2% | 7,394,568 | |||
| Net Assets Applicable to Common Shares – 100% | $ 176,216,857 | |||
| (1) | All percentages shown in the Portfolio of Investments are based on net assets applicable to common shares unless otherwise noted. |
| (2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. Optional Call Provisions are not covered by the report of independent registered public accounting firm. |
| (3) | The ratings disclosed are the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. Ratings are not covered by the report of independent registered public accounting firm. |
| (4) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in inverse floating rate transactions. |
| (5) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. |
| (6) | Defaulted security. A security whose issuer has failed to fully pay principal and/or interest when due, or is under the protection of bankruptcy. |
| (7) | For fair value measurement disclosure purposes, investment classified as Level 2. |
| (8) | Common Stock received as part of the bankruptcy settlement during February 2020 for Ohio Air Quality Development Authority, Ohio, Pollution Control Revenue Bonds, FirstEnergy Generation Project, Refunding Series 2006A, 3.750%, 12/01/23. |
| (9) | Non-income producing; issuer has not declared an ex-dividend date within the past twelve months. |
| (10) | Adjustable Rate MuniFund Term Preferred Shares, net of deferred offering cost as a percentage of Total Investments is 24.6%. |
| 144A | Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers. |
| AMT | Alternative Minimum Tax |
| ETM | Escrowed to maturity |
| IF | Inverse floating rate security issued by a tender option bond (“TOB”) trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association (SIFMA) short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. |
| WI/DD | Purchased on a when-issued or delayed delivery basis. |
See accompanying notes to financial statements
45
Statement of Assets and Liabilities
May 31, 2022
| NID | NIQ | |
| Assets | ||
| Long-term investments, at value (cost $798,917,889 and $222,731,130, respectively) | $819,190,451 | $223,793,243 |
| Cash | 7,224,917 | 1,008,925 |
| Cash collateral at brokers for investments in futures contracts¹ | 115,003 | — |
| Receivable for: | ||
| Interest | 13,086,605 | 3,238,605 |
| Investments sold | 15,099,792 | 5,880,000 |
| Variation margin on futures contracts | 36,500 | — |
| Other assets | 68,191 | 5,232 |
| Total assets | 854,821,459 | 233,926,005 |
| Liabilities | ||
| Floating rate obligations | 27,950,000 | — |
| Payable for: | ||
| Dividends | 2,069,378 | 485,430 |
| Interest | 94,363 | — |
| Investments purchased - when-issued/delayed-delivery settlement | 700,000 | 2,101,095 |
| Adjustable Rate MuniFund Term Preferred (“AMTP”) Shares, net of deferred offering costs (liquidation preference | ||
| $175,000,000 and $55,000,000, respectively) | 174,968,336 | 54,970,954 |
| Accrued expenses: | ||
| Management fees | 454,305 | 100,038 |
| Trustees fees | 62,102 | 1,540 |
| Other | 146,032 | 50,091 |
| Total liabilities | 206,444,516 | 57,709,148 |
| Commitments and contingencies (as disclosed in Note 8) | ||
| Net Assets applicable to common shares | $648,376,943 | $176,216,857 |
| Common shares outstanding | 46,924,069 | 13,098,868 |
| Net asset value (“NAV”) per common share outstanding | $ 13.82 | $ 13.45 |
| Net assets applicable to common shares consist of: | ||
| Common shares, $0.01 par value per share | $ 469,241 | $ 130,989 |
| Paid-in surplus | 670,294,142 | 186,818,031 |
| Total distributable earnings (loss) | (22,386,440) | (10,732,163) |
| Net assets applicable to common shares | $648,376,943 | $176,216,857 |
| Authorized shares: | ||
| Common | Unlimited | Unlimited |
| Preferred | Unlimited | Unlimited |
(1) Cash pledged to collateralize the net payment obligations for investments in derivatives.
See accompanying notes to financial statements.
46
Statement of Operations
Year Ended May 31, 2022
| NID | NIQ | |
| Investment Income | $ 33,627,430 | $ 7,741,702 |
| Expenses | ||
| Management fees | 5,633,324 | 1,268,309 |
| Interest expense and amortization of offering costs | 2,186,562 | 613,646 |
| Custodian expenses, net | 88,951 | 33,737 |
| Trustees fees | 26,669 | 7,274 |
| Professional fees | 96,756 | 65,738 |
| Shareholder reporting expenses | 55,481 | 21,655 |
| Shareholder servicing agent fees | 14,693 | 14,672 |
| Stock exchange listing fees | 13,359 | 6,946 |
| Investor relations expenses | 29,012 | 8,419 |
| Other | 27,287 | 24,096 |
| Total expenses | 8,172,094 | 2,064,492 |
| Net investment income (loss) | 25,455,336 | 5,677,210 |
| Realized and Unrealized Gain (Loss) | ||
| Net realized gain (loss) from: | ||
| Investments | (10,770,348) | (459,257) |
| Futures contracts | 396,672 | — |
| Change in net unrealized appreciation (depreciation) of: | ||
| Investments | (32,717,203) | (18,492,734) |
| Futures contracts | 54,205 | — |
| Net realized and unrealized gain (loss) | (43,036,674) | (18,951,991) |
| Net increase (decrease) in net assets applicable to common shares from operations | $(17,581,338) | $(13,274,781) |
See accompanying notes to financial statements.
47
Statement of Changes in Net Assets
| NID | NIQ | ||||||
| Year | Year | Year | Year | ||||
| Ended | Ended | Ended | Ended | ||||
| 5/31/22 | 5/31/21 | 5/31/21 | 5/31/21 | ||||
| Operations | |||||||
| Net investment income (loss) | $ 25,455,336 | $ 26,274,823 | $ 5,677,210 | $ 6,520,513 | |||
| Net realized gain (loss) from: | |||||||
| Investments | (10,770,348) | 571,471 | (459,257) | (446,308) | |||
| Futures contracts | 396,672 | 524,221 | — | — | |||
| Change in net unrealized appreciation (depreciation) of: | |||||||
| Investments | (32,717,203) | 48,753,532 | (18,492,734) | 7,862,600 | |||
| Futures contracts | 54,205 | 5,099 | — | — | |||
| Net increase (decrease) in net assets applicable to common shares | |||||||
| from operations | (17,581,338) | 76,129,146 | (13,274,781) | 13,936,805 | |||
| Distributions to Common Shareholders | |||||||
| Dividends | (26,063,965) | (24,486,843) | (6,417,932) | (6,077,075) | |||
| Decrease in net assets applicable to common shares from distributions | (26,063,965) | (24,486,843) | (6,417,932) | (6,077,075) | |||
| Capital Share Transactions | |||||||
| Net proceeds from common shares issued to shareholders due to | |||||||
| reinvestment of distributions | 215,514 | — | 25,616 | — | |||
| Net increase (decrease) in net assets applicable to common shares from | |||||||
| capital share transactions | 215,514 | — | 25,616 | — | |||
| Net increase (decrease) in net assets applicable to common shares | (43,429,789) | 51,642,303 | (19,667,097) | 7,859,730 | |||
| Net assets applicable to common shares at the beginning of period | 691,806,732 | 640,164,429 | 195,883,954 | 188,024,224 | |||
| Net assets applicable to common shares at the end of period | $648,376,943 | $691,806,732 | $176,216,857 | $195,883,954 |
See accompanying notes to financial statements.
48
Statement of Cash Flows
Year Ended May 31, 2022
| NID | NIQ | |
| Cash Flows from Operating Activities: | ||
| Net Increase (Decrease) in Net Assets Applicable to Common Shares from Operations | $ (17,581,338) | $(13,274,781) |
| Adjustments to reconcile the net increase (decrease) in net assets applicable to common | ||
| shares from operations to net cash provided by (used in) operating activities: | ||
| Purchases of investments | (146,242,029) | (50,254,763) |
| Proceeds from sales and maturities of investments | 155,367,742 | 51,424,421 |
| Taxes paid | (14,915) | — |
| Amortization (Accretion) of premiums and discounts, net | 8,172,216 | 3,625,840 |
| Amortization of deferred offering costs | 38,136 | 26,911 |
| (Increase) Decrease in: | ||
| Receivable for interest | 678,051 | 214,663 |
| Receivable for investments sold | (13,019,686) | (5,375,000) |
| Receivable for variation margin on futures contracts | (36,500) | — |
| Other assets | (12,903) | (5,232) |
| Increase (Decrease) in: | ||
| Payable for interest | (157,698) | — |
| Payable for investments purchased - when-issued/delayed-delivery settlement | 700,000 | (513,666) |
| Payable for variation margin on futures contracts | (11,156) | — |
| Accrued management fees | (28,370) | (10,905) |
| Accrued Trustees fees | (4,358) | (2,721) |
| Accrued other expenses | (92,097) | (54,184) |
| Net realized (gain) loss from: | ||
| Investments | 10,770,348 | 459,257 |
| Paydowns | (110,665) | — |
| Change in net unrealized (appreciation) depreciation of investments | 32,717,203 | 18,492,734 |
| Net cash provided by (used in) operating activities | 31,131,981 | 4,752,574 |
| Cash Flow from Financing Activities: | ||
| Proceeds from borrowings | 4,700,000 | — |
| (Repayments of) borrowings | (4,700,000) | — |
| Proceeds from floating rate obligations | 154,000 | — |
| (Repayments of) floating rate obligations | (7,500,000) | — |
| Cash distributions paid to common shareholders | (25,740,613) | (6,438,826) |
| Net cash provided by (used in) financing activities | (33,086,613) | (6,438,826) |
| Net Increase (Decrease) in Cash and Cash Collateral at Brokers | (1,954,632) | (1,686,252) |
| Cash and cash collateral at brokers at the beginning of period | 9,294,552 | 2,695,177 |
| Cash and cash collateral at brokers at the end of period | $ 7,339,920 | $ 1,008,925 |
| The following table provides a reconciliation of cash and cash collateral at brokers to the statement of assets and liabilities: | ||
| Cash | $ 7,224,917 | $ 1,008,925 |
| Cash collateral at brokers for investments in futures contracts | 115,003 | — |
| Total cash and cash collateral at brokers | $ 7,339,920 | $ 1,008,925 |
| Supplemental Disclosure of Cash Flow Information | ||
| Cash paid for interest (excluding borrowing and amortization of offering costs) | $ 2,298,441 | $ 585,727 |
| Non-cash financing activities not included herein consists of reinvestments of common share distributions | 215,514 | 25,616 |
See accompanying notes to financial statements.
49
Financial Highlights
Selected data for a common share outstanding throughout each period:
| Less Distributions to | |||||||||||
| Investment Operations | Common Shareholders | Common Share | |||||||||
| Beginning | Net | Net | From | From | |||||||
| Common | Investment | Realized/ | Net | Accumulated | Ending | ||||||
| Share | Income | Unrealized | Investment | Net Realized | Ending | Share | |||||
| NAV | (Loss) | Gain (Loss) | Total | Income | Gains | Total | NAV | Price | |||
| NID | |||||||||||
| Year Ended 5/31: | |||||||||||
| 2022 | $14.75 | $0.54 | $(0.91) | $(0.37) | $(0.56) | $ — | $(0.56) | $13.82 | $13.70 | ||
| 2021 | 13.65 | 0.58 | 1.04 | 1.62 | (0.52) | — | (0.52) | 14.75 | 14.44 | ||
| 2020 | 14.27 | 0.54 | (0.65) | (0.11) | (0.51) | — | (0.51) | 13.65 | 13.27 | ||
| 2019 | 13.61 | 0.54 | 0.63 | 1.17 | (0.51) | — | (0.51) | 14.27 | 13.38 | ||
| 2018 | 13.72 | 0.59 | (0.08) | 0.51 | (0.62) | — | (0.62) | 13.61 | 12.57 | ||
| NIQ | |||||||||||
| Year Ended 5/31: | |||||||||||
| 2022 | 14.96 | 0.43 | (1.45) | (1.02) | (0.49) | — | (0.49) | 13.45 | 13.15 | ||
| 2021 | 14.36 | 0.50 | 0.56 | 1.06 | (0.46) | — | (0.46) | 14.96 | 14.82 | ||
| 2020 | 14.30 | 0.41 | 0.03 | 0.44 | (0.38) | — | (0.38) | 14.36 | 13.89 | ||
| 2019 | 13.66 | 0.41 | 0.60 | 1.01 | (0.37) | — | (0.37) | 14.30 | 13.26 | ||
| 2018 | 13.95 | 0.45 | (0.28) | 0.17 | (0.46) | — | (0.46) | 13.66 | 12.52 | ||
50
| Common Share Supplemental Data/ | |||||
| Ratios Applicable to Common Shares | |||||
| Common Share | |||||
| Total Returns | Ratios to Average Net Assets(b) | ||||
| Based | Ending | ||||
| Based | on | Net | Net | Portfolio | |
| on | Share | Assets | Investment | Turnover | |
| NAV(a) | Price(a) | (000) | Expenses | Income (Loss) | Rate(c) |
| (2.73)% | (1.41)% | $648,377 | 1.19% | 3.72% | 17% |
| 12.09 | 13.01 | 691,807 | 1.19 | 4.06 | 13 |
| (0.83) | 2.97 | 640,164 | 1.51 | 3.83 | 17 |
| 8.80 | 10.80 | 669,379 | 1.59 | 3.95 | 13 |
| 3.75 | (1.56) | 638,580 | 1.48 | 4.35 | 19 |
| (7.00) | (8.23) | 176,217 | 1.09 | 2.98 | 21 |
| 7.50 | 10.16 | 195,884 | 1.05 | 3.38 | 8 |
| 3.11 | 7.70 | 188,024 | 1.43 | 2.86 | 13 |
| 7.54 | 9.06 | 187,339 | 1.55 | 2.96 | 20 |
| 1.21 | (1.37) | 178,946 | 1.41 | 3.24 | 10 |
| (a) | Total Return Based on Common Share NAV is the combination of changes in common share NAV, reinvested dividend income at NAV and reinvested capital gains distributions at NAV, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending NAV. The actual reinvest price for the last dividend declared in the period may often be based on the Fund’s market price (and not its NAV), and therefore may be different from the price used in the calculation. Total returns are not annualized. |
Total Return Based on Common Share Price is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized.
| (b) | • | Net Investment Income (Loss) ratios reflect income earned and expenses incurred on assets attributable to preferred shares issued by the Fund, where applicable. |
| • | The expense ratios reflect, among other things, all interest expense and other costs related to preferred shares (as described in Note 5 – Fund Shares) and/or the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund (as described in Note 4 – Portfolio Securities and Investments in Derivatives), where applicable, as follows: |
| Ratios of Interest Expense to | Ratios of Interest Expense to | |||
| Average Net Assets Applicable | Average Net Assets Applicable | |||
| NID | to Common Shares | NIQ | to Common Shares | |
| Year Ended 5/31: | Year Ended 5/31: | |||
| 2022 | 0.32% | 2022 | 0.32% | |
| 2021 | 0.28 | 2021 | 0.28 | |
| 2020 | 0.62 | 2020 | 0.64 | |
| 2019 | 0.69 | 2019 | 0.74 | |
| 2018 | 0.57 | 2018 | 0.61 |
(c) Portfolio Turnover Rate is calculated based on the lesser of long-term purchases or sales (as disclosed in Note 4 – Portfolio Securities and Investments in Derivatives), divided by the average long-term market value during the period.
See accompanying notes to financial statements.
51
Financial Highlights (continued)
The following table sets forth information regarding each Fund’s outstanding senior securities as of the end of each of the Fund's last five fiscal periods, as applicable.
| AMTP Shares | ||
| Aggregate | Asset | |
| Amount | Coverage | |
| Outstanding | Per $100,000 | |
| (000)(a) | Share(b) | |
| NID | ||
| Year Ended 5/31: | ||
| 2022 | $175,000 | $470,501 |
| 2021 | 175,000 | 495,318 |
| 2020 | 175,000 | 465,808 |
| 2019 | 175,000 | 482,502 |
| 2018 | 175,000 | 464,903 |
| NIQ | ||
| Year Ended 5/31: | ||
| 2022 | 55,000 | 420,394 |
| 2021 | 55,000 | 456,153 |
| 2020 | 55,000 | 441,862 |
| 2019 | 55,000 | 440,616 |
| 2018 | 55,000 | 425,356 |
| (a) | Aggregate Amount Outstanding: Aggregate amount outstanding represents the liquidation preference as of the end of the relevant fiscal year. |
| (b) | Asset Coverage Per $100,000: Asset coverage per $100,000 is calculated by subtracting the Fund’s liabilities and indebtedness not represented by senior securities from the Fund’s total assets, dividing the result by the aggregate amount of the Fund’s senior securities representing indebtedness then outstanding (if applicable,) plus the aggregate of the involuntary liquidation preference of the outstanding preferred shares, if applicable, and multiplying the result by 100,000. |
See accompanying notes to financial statements.
52
Notes to
Financial Statements
1.
General Information
Fund Information
The funds covered in this report and their corresponding New York Stock Exchange (“NYSE”) symbols are as follows (each a “Fund” and collectively, the “Funds”):
• Nuveen Intermediate Duration Municipal Term Fund (NID)
• Nuveen Intermediate Duration Quality Municipal Term Fund (NIQ)
The Funds are registered under the Investment Company Act of 1940 (the “1940 Act”), as amended, as diversified closed-end management investment companies. NID and NIQ were organized as Massachusetts business trusts on September 11, 2012 and December 11, 2012, respectively. NID and NIQ each have a term of ten years and intend to liquidate and distribute their net assets to shareholders on or before March 31, 2023 and June 30, 2023, respectively.
Current Fiscal Period
The end of the reporting period for the Funds is May 31, 2022, and the period covered by these Notes to Financial Statements is the fiscal year ended May 31, 2022 (the “current fiscal period”).
Investment Adviser and Sub-Adviser
The Funds’ investment adviser is Nuveen Fund Advisors, LLC (the “Adviser”), a subsidiary of Nuveen, LLC (“Nuveen”). Nuveen is the investment management arm of Teachers Insurance and Annuity Association of America (TIAA). The Adviser has overall responsibility for management of the Funds, oversees the management of the Funds’ portfolios, manages the Funds’ business affairs and provides certain clerical, bookkeeping and other administrative services, and, if necessary, asset allocation decisions. The Adviser has entered into sub-advisory agreements with Nuveen Asset Management, LLC (the “Sub-Adviser”), a subsidiary of the Adviser, under which the Sub-Adviser manages the investment portfolios of the Funds.
Developments Regarding the Funds’ Control Share By-Law
On October 5, 2020, the Funds and certain other closed-end funds in the Nuveen fund complex amended their by-laws. Among other things, the amended by-laws included provisions pursuant to which, in summary, a shareholder who obtains beneficial ownership of common shares in a Control Share Acquisition (as defined in the by-laws) shall have the same voting rights as other common shareholders only to the extent authorized by the other disinterested shareholders (the “Control Share By-Law”). On January 14, 2021, a shareholder of certain Nuveen closed-end funds filed a civil complaint in the U.S. District Court for the Southern District of New York (the “District Court”) against certain Nuveen funds and their trustees, seeking a declaration that such funds’ Control Share By-Laws violate the 1940 Act, rescission of such fund’s Control Share By-Laws and a permanent injunction against such funds applying the Control Share By-Laws. On February 18, 2022, the District Court granted judgment in favor of the plaintiff’s claim for rescission of such funds’ Control Share By-Laws and the plaintiff’s declaratory judgment claim, and declared that such funds’ Control Share By-Laws violate Section 18(i) of the 1940 Act. Following review of the judgment of the District Court, on February 22, 2022, the Board of Trustees amended the Funds’ by-laws to provide that the Funds’ Control Share By-Law shall be of no force and effect for so long as the judgment of the District Court is effective and that if the judgment of the District Court is reversed, overturned, vacated, stayed, or otherwise nullified, the Funds’ Control Share By-Law will be automatically reinstated and apply to any beneficial owner of common shares acquired in a Control Share Acquisition, regardless of whether such Control Share Acquisition occurs before or after such reinstatement, for the duration of the stay or upon issuance of the mandate reversing, overturning, vacating or otherwise nullifying the judgment of the District Court. On February 25, 2022, the Board and the Funds appealed the District Court’s decision to the U.S. Court of Appeals for the Second Circuit.
Other Matters
The outbreak of the novel coronavirus (“COVID-19”) and subsequent global pandemic began significantly impacting the U.S. and global financial markets and economies during the calendar quarter ended March 31, 2020. The worldwide spread of COVID-19 has created significant uncertainty in the global economy. The duration and extent of COVID-19 over the long term cannot be reasonably estimated at this time. The ultimate impact of COVID-19 and the extent to which COVID-19 impacts the Funds’ normal course of business, results of operations, investments, and cash flows will depend on future developments, which are highly uncertain and difficult to predict. Management continues to monitor and evaluate this situation.
53
Notes to Financial Statements (continued)
2. Significant Accounting Policies
The accompanying financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require the use of estimates made by management and the evaluation of subsequent events. Actual results may differ from those estimates. Each Fund is an investment company and follows the accounting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 946, Financial Services—Investment Companies. The net asset value (“NAV”) for financial reporting purposes may differ from the NAV for processing security and common share transactions. The NAV for financial reporting purposes includes security and common share transactions through the date of the report. Total return is computed based on the NAV used for processing security and common share transactions. The following is a summary of the significant accounting policies consistently followed by the Funds.
Compensation
The Funds pay no compensation directly to those of its trustees or to its officers, all of whom receive remuneration for their services to the Funds from the Adviser or its affiliates. The Funds’ Board of Trustees (the “Board”) has adopted a deferred compensation plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen-advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen-advised funds.
Custodian Fee Credit
As an alternative to overnight investments, each Fund has an arrangement with its custodian bank, State Street Bank and Trust Company, (the “Custodian”) whereby certain custodian fees and expenses are reduced by net credits earned on each Fund’s cash on deposit with the bank. Credits for cash balances may be offset by charges for any days on which a Fund overdraws its account at the Custodian. The amount of custodian fee credit earned by a Fund is recognized on the Statement of Operations as a component of “Custodian expenses, net.” During the current reporting period, the custodian fee credit earned by each Fund was as follows:
| NID | NIQ | |
| Custodian Fee Credit | $2,438 | $793 |
Distributions to Common Shareholders
Distributions to common shareholders are recorded on the ex-dividend date. The amount, character and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP.
Indemnifications
Under the Funds’ organizational documents, their officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Funds enter into contracts that provide general indemnifications to other parties. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote.
Investments and Investment Income
Securities transactions are accounted for as of the trade date for financial reporting purposes. Realized gains and losses on securities transactions are based upon the specific identification method. Investment income is comprised of interest income, which is recorded on an accrual basis and includes accretion of discounts and amortization of premiums for financial reporting purposes. Investment income also reflects payment-in-kind (“PIK”) interest and paydown gains and losses, if any. PIK interest represents income received in the form of securities in lieu of cash. Investment income also reflects dividend income, which is recorded on the ex-dividend date.
Netting Agreements
In the ordinary course of business, the Funds may enter into transactions subject to enforceable International Swaps and Derivatives Association, Inc. (ISDA) master agreements or other similar arrangements (“netting agreements”). Generally, the right to offset in netting agreements allows each Fund to offset certain securities and derivatives with a specific counterparty, when applicable, as well as any collateral received or delivered to that counterparty based on the terms of the agreements. Generally, each Fund manages its cash collateral and securities collateral on a counterparty basis.
The Funds’ investments subject to netting agreements as of the end of the reporting period, if any, are further described in Note 4 – Portfolio Securities and Investments in Derivatives.
54
New
Accounting Pronouncements and Rule Issuances
Reference Rate Reform
In March 2020, FASB issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The main objective of the new guidance is to provide relief to companies that will be impacted by the expected change in benchmark interest rates, when participating banks will no longer be required to submit London Interbank Offered Rate (LIBOR) quotes by the UK Financial Conduct Authority (FCA). The new guidance allows companies to, provided the only changes to existing contracts are a change to an approved benchmark interest rate, account for modifications as a continuance of the existing contract without additional analysis. For new and existing contracts, the Funds may elect to apply the amendments as of March 12, 2020 through December 31, 2022. Management has not yet elected to apply the amendments, is continuously evaluating the potential effect a discontinuation of LIBOR could have on the Funds’ investments and has currently determined that it is unlikely the ASU’s adoption will have a significant impact on the Funds’ financial statements and various filings.
Securities and Exchange Commission (“SEC”) Adopts New Rules to Modernize Fund Valuation Framework
In December 2020, the SEC voted to adopt a new rule governing fund valuation practices. New Rule 2a-5 under the 1940 Act establishes requirements for determining fair value in good faith for purposes of the 1940 Act. Rule 2a-5 will permit fund boards to designate certain parties to perform fair value determinations, subject to board oversight and certain other conditions. Rule 2a-5 also defines when market quotations are “readily available” for purposes of Section 2(a)(41) of the 1940 Act, which requires a fund to fair value a security when market quotations are not readily available. The SEC also adopted new Rule 31a-4 under the 1940 Act, which sets forth the recordkeeping requirements associated with fair value determinations. Finally, the SEC is rescinding previously issued guidance on related issues, including the role of a board in determining fair value and the accounting and auditing of fund investments. Rule 2a-5 and Rule 31a-4 became effective on March 8, 2021, with a compliance date of September 8, 2022. A fund may voluntarily comply with the rules after the effective date, and in advance of the compliance date, under certain conditions. Management is currently assessing the impact of these provisions on the Funds’ financial statements.
3. Investment Valuation and Fair Value Measurements
The Funds’ investments in securities are recorded at their estimated fair value utilizing valuation methods approved by the Board. Fair value is defined as the price that would be received upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. U.S. GAAP establishes the three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect management's assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The following is a summary of the three-tiered hierarchy of valuation input levels.
| Level | 1 – Inputs are unadjusted and prices are determined using quoted prices in active markets for identical securities. |
| Level | 2 – Prices are determined using other significant observable inputs (including quoted prices for similar securities, interest rates, credit spreads, etc.). |
| Level | 3 – Prices are determined using significant unobservable inputs (including management’s assumptions in determining the fair value of investments). |
A description of the valuation techniques applied to the Funds’ major classifications of assets and liabilities measured at fair value follows:
Prices of fixed-income securities are generally provided by an independent pricing service (“pricing service”) approved by the Board. The pricing service establishes a security’s fair value using methods that may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information about a security, its issuer or market activity provided by the Adviser. These securities are generally classified as Level 2.
Equity securities and exchange-traded fund listed or traded on a national market or exchange are valued based on their sale price at the official close of business of such market or exchange on the valuation date. Foreign equity securities and registered investment companies that trade on a foreign exchange are valued at the last sale price or official closing price reported on the exchange where traded and converted to U.S. dollars at the prevailing rates of exchange on the date of valuation. To the extent these securities are actively traded and that valuation adjustments are not applied, they are generally classified as Level 1. If there is no official close of business, then the latest available sale price is utilized. If no sales are reported, then the mean of the latest available bid and ask prices is utilized and these securities are generally classified as Level 2.
Futures contracts are valued using the closing settlement price or, in the absence of such a price, the last traded price and are generally classified as Level 1.
55
Notes to Financial Statements (continued)
Any portfolio security or derivative for which market quotations are not readily available or for which the above valuation procedures are deemed not to reflect fair value are valued at fair value, as determined in good faith using procedures approved by the Board. As a general principle, the fair value of a security would appear to be the amount that the owner might reasonably expect to receive for it in a current sale. A variety of factors may be considered in determining the fair value of such securities, which may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. To the extent the inputs are observable and timely, the values would be classified as Level 2 of the fair value hierarchy; otherwise they would be classified as Level 3.
The following table summarizes the market value of the Funds’ investments as of the end of the reporting period, based on the inputs used to value them:
| NID | Level 1 | Level 2 | Level 3 | Total |
| Long-Term Investments:* | ||||
| Municipal Bonds | $ — | $755,919,519 | $56,966*** | $755,976,485 |
| Common Stocks | — | 63,213,966** | — | 63,213,966 |
| Investments in Derivatives: | ||||
| Futures Contracts**** | 46,334 | — | — | 46,334 |
| Total | $46,334 | $819,133,485 | $56,966 |
$819,236,785 |
| NIQ | ||||
| Long-Term Investments:* | ||||
| Municipal Bonds | $ — | $217,443,611 | $ — | $217,443,611 |
| Common Stocks | — | 6,349,632** | — | 6,349,632 |
| Total | $ — | $223,793,243 | $ — | $223,793,243 |
| * | Refer to the Fund’s Portfolio of Investments for state and/or industry classifications, where applicable. |
| ** | Refer to the Fund’s Portfolio of Investments for securities classified as Level 2. |
| *** | Refer to the Fund’s Portfolio of Investments for securities classified as Level 3. |
| **** | Represents net unrealized appreciation (depreciation) as reported in the Fund’s Portfolio of Investments. |
The Funds hold liabilities in floating rate obligations and preferred shares, where applicable, which are not reflected in the tables above. The fair values of the Funds’ liabilities for floating rate obligations approximate their liquidation values. Floating rate obligations are generally classified as Level 2 and further described in Note 4 – Portfolio Securities and Investments in Derivatives. The fair values of the Funds’ liabilities for preferred shares approximate their liquidation preference. Preferred shares are generally classified as Level 2 and further described in Note 5 – Fund Shares.
4. Portfolio Securities and Investments in Derivatives
Portfolio Securities
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond (referred to as an “Underlying Bond”), typically with a fixed interest rate, into a special purpose tender option bond (“TOB”) trust (referred to as the “TOB Trust”) created by or at the direction of one or more Funds. In turn, the TOB Trust issues (a) floating rate certificates (referred to as “Floaters”), in face amounts equal to some fraction of the Underlying Bond’s par amount or market value, and (b) an inverse floating rate certificate (referred to as an “Inverse Floater”) that represents all remaining or residual interest in the TOB Trust. Floaters typically pay short-term tax-exempt interest rates to third parties who are also provided a right to tender their certificate and receive its par value, which may be paid from the proceeds of a remarketing of the Floaters, by a loan to the TOB Trust from a third party liquidity provider (“Liquidity Provider”), or by the sale of assets from the TOB Trust. The Inverse Floater is issued to a long term investor, such as one or more of the Funds. The income received by the Inverse Floater holder varies inversely with the short-term rate paid to holders of the Floaters, and in most circumstances the Inverse Floater holder bears substantially all of the Underlying Bond’s downside investment risk and also benefits disproportionately from any potential appreciation of the Underlying Bond’s value. The value of an Inverse Floater will be more volatile than that of the Underlying Bond because the interest rate is dependent on not only the fixed coupon rate of the Underlying Bond but also on the short-term interest paid on the Floaters, and because the Inverse Floater essentially bears the risk of loss (and possible gain) of the greater face value of the Underlying Bond.
The Inverse Floater held by a Fund gives the Fund the right to (a) cause the holders of the Floaters to tender their certificates at par (or slightly more than par in certain circumstances), and (b) have the trustee of the TOB Trust (the “Trustee”) transfer the Underlying Bond held by the TOB Trust to the Fund, thereby collapsing the TOB Trust.
A Fund may acquire an Inverse Floater in a transaction where it (a) transfers an Underlying Bond that it owns to a TOB Trust created by a third party or (b) transfers an Underlying Bond that it owns, or that it has purchased in a secondary market transaction for the purpose of creating an Inverse Floater, to a TOB Trust created at its direction, and in return receives the Inverse Floater of the TOB Trust (referred to as a “self-deposited Inverse Floater”). A
56
Fund may also purchase an Inverse Floater in a secondary market transaction from a third party creator of the TOB Trust without first owning the Underlying Bond (referred to as an “externally-deposited Inverse Floater”).
An investment in a self-deposited Inverse Floater is accounted for as a “financing” transaction (i.e., a secured borrowing). For a self-deposited Inverse Floater, the Underlying Bond deposited into the TOB Trust is identified in the Fund’s Portfolio of Investments as “(UB) – Underlying bond of an inverse floating rate trust reflected as a financing transaction,” with the Fund recognizing as liabilities, labeled “Floating rate obligations” on the Statement of Assets and Liabilities, (a) the liquidation value of Floaters issued by the TOB Trust, and (b) the amount of any borrowings by the TOB Trust from a Liquidity Provider to enable the TOB Trust to purchase outstanding Floaters in lieu of a remarketing. In addition, the Fund recognizes in “Investment Income” the entire earnings of the Underlying Bond, and recognizes (a) the interest paid to the holders of the Floaters or on the TOB Trust’s borrowings, and (b) other expenses related to remarketing, administration, trustee, liquidity and other services to a TOB Trust, as a component of “Interest expense and amortization of offering costs” on the Statement of Operations. Earnings due from the Underlying Bond and interest due to the holders of the Floaters as of the end of the reporting period are recognized as components of “Receivable for interest” and “Payable for interest” on the Statement of Assets and Liabilities, respectively.
In contrast, an investment in an externally-deposited Inverse Floater is accounted for as a purchase of the Inverse Floater and is identified in the Fund’s Portfolio of Investments as “(IF) – Inverse floating rate investment.” For an externally-deposited Inverse Floater, a Fund’s Statement of Assets and Liabilities recognizes the Inverse Floater and not the Underlying Bond as an asset, and the Fund does not recognize the Floaters, or any related borrowings from a Liquidity Provider, as a liability. Additionally, the Fund reflects in “Investment Income” only the net amount of earnings on the Inverse Floater (net of the interest paid to the holders of the Floaters or the Liquidity Provider as lender, and the expenses of the Trust), and does not show the amount of that interest paid or the expenses of the TOB Trust as described above as interest expense on the Statement of Operations.
Fees paid upon the creation of a TOB Trust for self-deposited Inverse Floaters and externally-deposited Inverse Floaters are recognized as part of the cost basis of the Inverse Floater and are capitalized over the term of the TOB Trust.
As of the end of the reporting period, the aggregate value of Floaters issued by each Fund’s TOB Trust for self-deposited Inverse Floaters and externally-deposited Inverse Floaters was as follows:
| Floating Rate Obligations Outstanding | NID | NIQ |
| Floating rate obligations: self-deposited Inverse Floaters | $ 27,950,000 | $ — |
| Floating rate obligations: externally-deposited Inverse Floaters | 155,880,000 | 34,530,000 |
| Total | $183,830,000 | $34,530,000 |
During the current fiscal period, the average amount of Floaters (including any borrowings from a Liquidity Provider) outstanding, and the average annual interest rate and fees related to self-deposited Inverse Floaters, were as follows:
| Self-Deposited Inverse Floaters | NID | NIQ |
| Average floating rate obligations outstanding | $35,076,219 | $— |
| Average annual interest rate and fees | 0.79% | —% |
TOB Trusts are supported by a liquidity facility provided by a Liquidity Provider pursuant to which the Liquidity Provider agrees, in the event that Floaters are (a) tendered to the Trustee for remarketing and the remarketing does not occur, or (b) subject to mandatory tender pursuant to the terms of the TOB Trust agreement, to either purchase Floaters or to provide the Trustee with an advance from a loan facility to fund the purchase of Floaters by the TOB Trust. In certain circumstances, the Liquidity Provider may otherwise elect to have the Trustee sell the Underlying Bond to retire the Floaters that were tendered and not remarketed prior to providing such a loan. In these circumstances, the Liquidity Provider remains obligated to provide a loan to the extent that the proceeds of the sale of the Underlying Bond is not sufficient to pay the purchase price of the Floaters.
The size of the commitment under the loan facility for a given TOB Trust is at least equal to the balance of that TOB Trust’s outstanding Floaters plus any accrued interest. In consideration of the loan facility, fee schedules are in place and are charged by the Liquidity Provider(s). Any loans made by the Liquidity Provider will be secured by the purchased Floaters held by the TOB Trust. Interest paid on any outstanding loan balances will be effectively borne by the Fund that owns the Inverse Floaters of the TOB Trust that has incurred the borrowing and may be at a rate that is greater than the rate that would have been paid had the Floaters been successfully remarketed.
As described above, any amounts outstanding under a liquidity facility are recognized as a component of “Floating rate obligations” on the Statement of Assets and Liabilities by the Fund holding the corresponding Inverse Floaters issued by the borrowing TOB Trust. As of the end of the reporting period there were no loans outstanding under any such facility.
Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a “recourse arrangement”) (TOB Trusts involving such agreements are referred to herein as “Recourse Trusts”), under which a Fund agrees to reimburse the Liquidity Provider for the Trust’s Floaters, in certain circumstances, for the amount (if any) by which the liquidation value of the Underlying Bond held by the TOB Trust may fall short of the sum of the liquidation value of the Floaters issued by the TOB Trust plus any amounts borrowed by the TOB Trust from the Liquidity Provider, plus any shortfalls in interest cash flows. Under these agreements, a Fund’s potential exposure to losses related to or on an Inverse Floater may increase beyond the value of the
57
Notes to Financial Statements (continued)
Inverse Floater as a Fund may potentially be liable to fulfill all amounts owed to holders of the Floaters or the Liquidity Provider. Any such shortfall amount in the aggregate is recognized as “Unrealized depreciation on Recourse Trusts” on the Statement of Assets and Liabilities.
As of the end of the reporting period, each Fund’s maximum exposure to the Floaters issued by Recourse Trusts for self-deposited Inverse Floaters and externally-deposited Inverse Floaters was as follows:
| Floating Rate Obligations – Recourse Trusts | NID | NIQ |
| Maximum exposure to Recourse Trusts: self-deposited Inverse Floaters | $ 27,950,000 | $ — |
| Maximum exposure to Recourse Trusts: externally-deposited Inverse Floaters | 155,880,000 | 34,530,000 |
| Total | $183,830,000 | $34,530,000 |
Zero Coupon Securities
A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically.
Investment Transactions
Long-term purchases and sales (including maturities but excluding derivative transactions, where applicable) during the current fiscal period were as follows:
| NID | NIQ | |
| Purchases | $146,242,029 | $50,254,763 |
| Sales and maturities | 155,367,742 | 51,424,421 |
The Funds may purchase securities on a when-issued or delayed-delivery basis. Securities purchased on a when-issued or delayed-delivery basis may have extended settlement periods; interest income is not accrued until settlement date. Any securities so purchased are subject to market fluctuation during this period. The Funds have earmarked securities in their portfolios with a current value at least equal to the amount of the when issued/ delayed-delivery purchase commitments. If the Funds have outstanding when-issued/delayed-delivery purchases commitments as of the end of the reporting period, such amounts are recognized on the Statement of Assets and Liabilities.
Investments in Derivatives
In addition to the inverse floating rate securities in which each Fund may invest, which are considered portfolio securities for financial reporting purposes, each Fund is authorized to invest in certain other derivative instruments such as futures, options and swap contracts. Each Fund limits its investments in futures, options on futures and swap contracts to the extent necessary for the Adviser to claim the exclusion from registration by the Commodity Futures Trading Commission as a commodity pool operator with respect to the Fund. The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes.
Futures Contracts
Upon execution of a futures contract, a Fund is obligated to deposit cash or eligible securities, also known as “initial margin,” into an account at its clearing broker equal to a specified percentage of the contract amount. Cash held by the broker to cover initial margin requirements on open futures contracts, if any, is recognized as “Cash collateral at brokers for investments in futures contracts” on the Statement of Assets and Liabilities. Investments in futures contracts obligate a Fund and the clearing broker to settle monies on a daily basis representing changes in the prior days “mark-to-market” of the open contracts. If a Fund has unrealized appreciation the clearing broker would credit the Fund’s account with an amount equal to appreciation and conversely if a Fund has unrealized depreciation the clearing broker would debit the Fund’s account with an amount equal to depreciation. These daily cash settlements are also known as “variation margin.” Variation margin is recognized as a receivable and/or payable for “Variation margin on futures contracts” on the Statement of Assets and Liabilities.
During the period the futures contract is open, changes in the value of the contract are recognized as an unrealized gain or loss by “marking-to-market” on a daily basis to reflect the changes in market value of the contract, which is recognized as a component of “Change in net unrealized appreciation (depreciation) of futures contracts” on the Statement of Operations. When the contract is closed or expired, a Fund records a realized gain or loss equal to the difference between the value of the contract on the closing date and value of the contract when originally entered into, which is recognized as a component of “Net realized gain (loss) from futures contracts” on the Statement of Operations.
Risks of investments in futures contracts include the possible adverse movement in the price of the securities or indices underlying the contracts, the possibility that there may not be a liquid secondary market for the contracts and/or that a change in the value of the contract may not correlate with a change in the value of the underlying securities or indices.
58
During the current fiscal period, NID used U.S. Treasury futures as part of an overall portfolio construction strategy to manage portfolio duration and yield curve exposure.
The average notional amount of futures contracts outstanding during the current fiscal period was as follows:
| NID | |
| Average notional amount of futures contracts outstanding* | $3,057,216 |
| * | The average notional amount is calculated based on the absolute aggregate notional amount of contracts outstanding at the beginning of the current fiscal period and at the end of each fiscal quarter within the current fiscal period. |
The following table presents the fair value of all futures contracts held by the Fund as of the end of the reporting period, the location of these instruments on the Statement of Assets and Liabilities and the primary underlying risk exposure.
| Location on the Statement of Assets and Liabilities | |||||||
| Asset Derivatives | (Liability) Derivatives | ||||||
| Underlying | Derivative | ||||||
| Risk Exposure | Instrument | Location | Value | Location | Value | ||
| NID | |||||||
| Interest rate | Futures contracts | Receivable for | $46,334 | — | $ — | ||
| variation margin on | |||||||
| futures contracts* | |||||||
* Value represents the cumulative unrealized appreciation (depreciation) of futures contracts as reported in the Fund’s Portfolio of Investments and not the daily asset and/or liability derivatives location as described in the table above.
The following table presents the amount of net realized gain (loss) and change in net unrealized appreciation (depreciation) recognized on futures contracts on the Statement of Operations during the current fiscal period, and the primary underlying risk exposure.
| Change in Net | |||
| Net Realized | Unrealized Appreciation | ||
| Underlying | Derivative | Gain (Loss) from | (Depreciation) of |
| Risk Exposure | Instrument | Futures Contracts | Futures Contracts |
| Interest rate | Futures contracts | $396,672 | $54,205 |
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities.
Each Fund helps manage counterparty credit risk by entering into agreements only with counterparties the Adviser believes have the financial resources to honor their obligations and by having the Adviser monitor the financial stability of the counterparties. Additionally, counterparties may be required to pledge collateral daily (based on the daily valuation of the financial asset) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when each Fund has an unrealized loss, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the valuations fluctuate, either up or down, by at least the pre-determined threshold amount.
5. Fund Shares
Common Share Transactions
Transactions in common shares for the Funds during the Funds’ current and prior fiscal period, where applicable, were as follows:
| NID | NIQ | ||||||
| Year | Year | Year | Year | ||||
| Ended | Ended | Ended | Ended | ||||
| 5/31/22 | 5/31/21 | 5/31/22 | 5/31/21 | ||||
| Common shares: | |||||||
| Issued to shareholders due to reinvestments of distributions | 14,409 | — | 1,724 | — | |||
59
Notes to Financial Statements (continued)
Preferred Shares
Adjustable Rate MuniFund Term Preferred Shares
The Funds have issued and have outstanding Adjustable Rate MuniFund Term Preferred (“AMTP”) Shares, with a $100,000 liquidation preference per share. AMTP Shares are issued via private placement and are not publicly available.
As of the end of the reporting period, details of each Fund’s AMTP Shares outstanding were as follows:
| Liquidation | ||||
| Preference, | ||||
| Shares | Liquidation | net of deferred | ||
| Fund | Series | Outstanding | Preference | offering cost |
| NID | 2023 | 1,750 | $175,000,000 | $174,968,336 |
| NIQ | 2023 | 550 | $55,000,000 | $54,970,954 |
Each Fund is obligated to redeem its AMTP Shares by the date as specified in its offering document (“Term Redemption Date”), unless earlier redeemed by the Fund. AMTP Shares are subject to optional and mandatory redemption in certain circumstances. The AMTP Shares may be redeemed at the option of each Fund, subject to payment of premium for approximately six months following the date of issuance (“Premium Expiration Date”), and at the redemption price per share thereafter. The redemption price per share is equal to the sum of the liquidation preference per share plus any accumulated but unpaid dividends.
AMTP Shares are short-term or short/intermediate-term instruments that pay a variable dividend rate tied to a short-term index, plus an additional fixed “spread” amount which is initially established at the time of issuance and may be adjusted in the future based upon a mutual agreement between the majority owner and each Fund. From time-to-time the majority owner may propose to each Fund an adjustment to the dividend rate. Should the majority owner and the Funds fail to agree upon an adjusted dividend rate, and such proposed dividend rate adjustment is not withdrawn, the Funds will be required to redeem all outstanding shares upon the end of a notice period.
In addition, the Funds may be obligated to redeem a certain amount of the AMTP Shares if the Funds fail to maintain certain asset coverage and leverage ratio requirements and such failures are not cured by the applicable cure date. The Term Redemption Date and Premium Expiration Date for each Fund’s AMTP Shares are as follows:
| Notice | Term | Premium | ||
| Fund | Period | Series | Redemption Date | Expiration Date |
| NID | 360-day | 2023 | March 31, 2023* | August 31, 2018 |
| NIQ | 360-day | 2023 | June 30, 2023* | August 31, 2018 |
* Subject to early termination by either the Fund or the holder.
The average liquidation preference of AMTP Shares outstanding and annualized dividend rate for the Funds during the current fiscal period were as follows:
| NID | NIQ | |
| Average liquidation preference of AMTP Shares outstanding | $175,000,000 | $55,000,000 |
| Annualized dividend rate | 1.06% | 1.06% |
AMTP Shares are subject to restrictions on transfer, generally do not trade, and market quotations are generally not available. The fair value of AMTP Shares is expected to be approximately their liquidation preference so long as the fixed “spread” on the AMTP Shares remains roughly in line with the “spread” being demanded by investors on instruments having similar terms in the current market environment. In present market conditions, the Funds’ Adviser has determined that the fair value of AMTP Shares is approximately their liquidation preference, but their fair value could vary if market conditions change materially. For financial reporting purposes, the liquidation preference of AMTP Shares is a liability and is recognized as a component of “Adjustable Rate MuniFund Term Preferred (“AMTP”) Shares, net of deferred offering costs” on the Statement of Assets and Liabilities.
AMTP Share dividends are treated as interest payments for financial reporting purposes. Unpaid dividends on AMTP Shares are recognized as a component of “Interest payable” on the Statement of Assets and Liabilities. Dividends accrued on AMTP Shares are recognized as a component of “Interest expense and amortization of offering costs” on the Statement of Operations.
Costs incurred in connection each Fund’s offering of AMTP Shares were recorded as deferred charges, which are amortized over the life of the shares and are recognized as components of “Adjustable Rate MuniFund Term Preferred (“AMTP”) Shares, net of deferred offering costs” on the Statement of Assets and Liabilities and “Interest expense and amortization of offering costs” on the Statement of Operations.
Preferred Share Transactions
The Funds did not have any transactions in preferred shares during the current or prior fiscal period.
60
6. Income Tax Information
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required.
Each Fund intends to satisfy conditions that will enable interest from municipal securities, which is exempt from regular federal income tax, to retain such tax-exempt status when distributed to shareholders of the Funds. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation.
Each Fund files income tax returns in U.S. federal and applicable state and local jurisdictions. A Fund's federal income tax returns are generally subject to examination for a period of three fiscal years after being filed. State and local tax returns may be subject to examination for an additional period of time depending on the jurisdiction. Management has analyzed each Fund's tax positions taken for all open tax years and has concluded that no provision for income tax is required in the Fund's financial statements.
Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing gains and losses on investment transactions. Temporary differences do not require reclassification. As of year end, permanent differences that resulted in reclassifications among the components of net assets relate primarily to distressed PIK bond adjustments, nondeductible offering costs, paydowns, taxable market discount and taxes paid. Temporary and permanent differences have no impact on a Fund's net assets.
As of year end, the aggregate cost and net unrealized appreciation/(depreciation) of all investments for federal income tax purposes was as follows:
| Gross | Gross | Net Unrealized | ||
| Unrealized | Unrealized | Appreciation | ||
| Fund | Tax Cost | Appreciation | (Depreciation) | (Depreciation) |
| NID | $770,552,911 | $50,832,807 | $(30,098,878) | $20,733,929 |
| NIQ | 222,679,397 | 6,311,380 | (5,197,534) | 1,113,846 |
For purposes of this disclosure, tax cost generally includes the cost of portfolio investments as well as up-front fees or premiums exchanged on derivatives and any amounts unrealized for income statement reporting but realized income and/or capital gains for tax reporting, if applicable.
As of year end, the components of accumulated earnings on a tax basis were as follows:
| Undistributed | Undistributed | Undistributed | Unrealized | Other | ||||
| Tax-Exempt | Ordinary | Long-Term | Appreciation | Capital Loss | Late-Year Loss | Book-to-Tax | ||
| Fund | Income1 | Income | Capital Gains | (Depreciation) | Carryforwards | Deferrals | Differences | Total |
| NID | $6,212,585 | $114,871 | $ — | $20,733,929 | $(47,265,856) | $ — | $(2,181,969) | $(22,386,440) |
| NIQ | 745,612 | — | — | 1,113,846 | (12,087,315) | — | (504,306) | (10,732,163) |
1 Undistributed tax-exempt income (on a tax basis) has not been reduced for the dividend declared on May 2, 2022 and paid on June 1, 2022.
The tax character of distributions paid were as follows:
| 5/31/22 | 5/31/21 | |||||
| Tax-Exempt | Ordinary | Long-Term | Tax-Exempt | Ordinary | Long-Term | |
| Fund | Income1 | Income | Capital Gains | Income | Income | Capital Gains |
| NID | $25,893,077 | $170,888 | $ — | $23,950,726 | $536,117 | $ — |
| NIQ | 6,417,932 | — | — | 5,977,263 | 99,812 | — |
1 Each Fund designates these amounts paid during the period as Exempt Interest Dividends.
As of year end, the Funds had capital loss carryforwards, which will not expire:
| Fund | Short-Term | Long-Term | Total |
| NID | $23,282,876 | $23,982,980 | $47,265,856 |
| NIQ | 9,022,206 | 3,065,109 | 12,087,315 |
61
Notes to Financial Statements (continued)
7. Management Fees and Other Transactions with Affiliates
Management Fees
Each Fund’s management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Sub-Adviser is compensated for its services to the Funds from the management fees paid to the Adviser.
Each Fund’s management fee consists of two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all eligible fund assets managed by the Adviser. This pricing structure enables Fund shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, for each Fund is calculated according to the following schedule:
| NID | NIQ | |
| Average Daily Managed Assets* | Fund-Level Fee Rate | Fund-Level Fee Rate |
| For the first $125 million | 0.4000% | 0.3000% |
| For the next $125 million | 0.3875 | 0.2875 |
| For the next $250 million | 0.3750 | 0.2750 |
| For the next $500 million | 0.3625 | 0.2625 |
| For the next $1 billion | 0.3500 | 0.2500 |
| For the next $3 billion | 0.3250 | 0.2250 |
| For managed assets over $5 billion | 0.3125 | 0.2125 |
The annual complex-level fee, payable monthly, for each Fund is calculated by multiplying the current complex-wide fee rate, determined according to the following schedule by the Fund’s daily managed assets:
| Complex-Level Eligible Asset Breakpoint Level* | Effective Complex-Level Fee Rate at Breakpoint Level |
| $55 billion | 0.2000% |
| $56 billion | 0.1996 |
| $57 billion | 0.1989 |
| $60 billion | 0.1961 |
| $63 billion | 0.1931 |
| $66 billion | 0.1900 |
| $71 billion | 0.1851 |
| $76 billion | 0.1806 |
| $80 billion | 0.1773 |
| $91 billion | 0.1691 |
| $125 billion | 0.1599 |
| $200 billion | 0.1505 |
| $250 billion | 0.1469 |
| $300 billion | 0.1445 |
* For the complex-level fees, managed assets include closed-end fund assets managed by the Adviser that are attributable to certain types of leverage. For these purposes, leverage includes the funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser as to certain funds to limit the amount of such assets for determining managed assets in certain circumstances. The complex-level fee is calculated based upon the aggregate daily managed assets of all Nuveen open-end and closed-end funds that constitute “eligible assets.” Eligible assets do not include assets attributable to investments in other Nuveen Funds or assets in excess of a determined amount (originally $2 billion) added to the Nuveen fund complex in connection with the Adviser’s assumption of the management of the former First American Funds effective January 1, 2011, but do not include certain Nuveen funds that were reorganized into funds advised by an affiliate of the Adviser during the 2019 calendar year. As of May 31, 2022, the complex-level fee for each Fund was 0.1559%.
Other Transactions with Affiliates
Each Fund is permitted to purchase or sell securities from or to certain other funds or accounts managed by the Sub-Adviser (“Affiliated Entity”) under specified conditions outlined in procedures adopted by the Board (“cross-trade”). These procedures have been designed to ensure that any cross-trade of securities by the Fund from or to an Affiliated Entity by virtue of having a common investment adviser (or affiliated investment adviser), common officer and/or common trustee complies with Rule 17a-7 under the 1940 Act. These transactions are effected at the current market price (as provided by an independent pricing service) without incurring broker commissions.
During the current fiscal period, the Funds did not engage in cross-trades pursuant to these procedures.
62
8. Commitments and Contingencies
In the normal course of business, each Fund enters into a variety of agreements that may expose the Fund to some risk of loss. These could include recourse arrangements for certain TOB Trusts and certain agreements related to preferred shares, which are described elsewhere in these Notes to Financial Statements. The risk of future loss arising from such agreements, while not quantifiable, is expected to be remote. As of the end of the reporting period, the Funds did not have any unfunded commitments.
From time to time, the Funds may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of the Funds’ rights under contracts. As of the end of the reporting period, management has determined that any legal proceeding(s) the Funds are subject to, including those described within this report, are unlikely to have a material impact to any of the Funds’ financial statements.
9. Borrowing Arrangements
Committed Line of Credit
The Funds, along with certain other funds managed by the Adviser (“Participating Funds”), have established a 364-day, $2.635 billion standby credit facility with a group of lenders, under which the Participating Funds may borrow for temporary purposes (other than on-going leveraging for investment purposes). Each Participating Fund is allocated a designated proportion of the facility’s capacity (and its associated costs, as described below) based upon a multifactor assessment of the likelihood and frequency of its need to draw on the facility, the size of the Fund and its anticipated draws, and the potential importance of such draws to the operations and well-being of the Fund, relative to those of the other Funds. A Fund may effect draws on the facility in excess of its designated capacity if and to the extent that other Participating Funds have undrawn capacity. The credit facility expires in June 2022 unless extended or renewed.
The credit facility has the following terms: 0.15% per annum on unused commitment amounts and a drawn interest rate equal to the higher of (a) OBFR (Overnight Bank Funding Rate) plus 1.20% per annum or (b) the Fed Funds Effective Rate plus 1.20% per annum on amounts borrowed. Prior to June 23, 2021, the drawn interest rate was equal to the higher of (a) one-month LIBOR (London Inter-Bank Offered Rate) plus 1.25% per annum or (b) the Fed Funds rate plus 1.25% per annum on amounts borrowed. The Participating Funds also incurred a 0.05% upfront fee on the increase of the $230 million commitment amount during the reporting period. Interest expense incurred by the Participating Funds, when applicable, is recognized as a component of “Interest expense and amortization of offering costs” on the Statement of Operations. Participating Funds paid administration, legal and arrangement fees, which are recognized as a component of “Interest expense and amortization of offering costs” on the Statement of Operations, and along with commitment fees, have been allocated among such Participating Funds based upon the relative proportions of the facility’s aggregate capacity reserved for them and other factors deemed relevant by the Adviser and the Board of each Participating Fund.
During the current fiscal period, the following Fund utilized this facility. The Fund’s maximum outstanding balance during the utilization period was as follows:
| NID | |
| Maximum outstanding balance | $4,700,000 |
During the Fund’s utilization period(s) during the current fiscal period, the average daily balance outstanding and average annual interest rate on the Borrowings were as follows:
| NID | |
| Utilization period (days outstanding) | 23 |
| Average daily balance outstanding | $1,595,652 |
| Average annual interest rate | 1.28% |
Borrowings outstanding as of the end of the reporting period, if any, are recognized as “Borrowings” on the Statement of Assets and Liabilities, where applicable.
Inter-Fund Borrowing and Lending
The SEC has granted an exemptive order permitting registered open-end and closed-end Nuveen funds to participate in an inter-fund lending facility whereby the Nuveen funds may directly lend to and borrow money from each other for temporary purposes (e.g., to satisfy redemption requests or when a sale of securities “fails,” resulting in an unanticipated cash shortfall) (the “Inter-Fund Program”). The closed-end Nuveen funds, including the Funds covered by this shareholder report, will participate only as lenders, and not as borrowers, in the Inter-Fund Program because such closed-end funds rarely, if ever, need to borrow cash to meet redemptions. The Inter-Fund Program is subject to a number of conditions, including, among other things, the requirements that (1) no fund may borrow or lend money through the Inter-Fund Program unless it receives a more favorable interest rate than is typically available from a bank or other financial institution for a comparable transaction; (2) no fund may borrow on an unsecured basis through the Inter-Fund Program unless the fund’s outstanding borrowings from all sources immediately after the inter-fund borrowing total 10% or less of its
63
Notes to Financial Statements (continued)
total assets; provided that if the borrowing fund has a secured borrowing outstanding from any other lender, including but not limited to another fund, the inter-fund loan must be secured on at least an equal priority basis with at least an equivalent percentage of collateral to loan value; (3) if a fund’s total outstanding borrowings immediately after an inter-fund borrowing would be greater than 10% of its total assets, the fund may borrow through the inter-fund loan on a secured basis only; (4) no fund may lend money if the loan would cause its aggregate outstanding loans through the Inter-Fund Program to exceed 15% of its net assets at the time of the loan; (5) a fund’s inter-fund loans to any one fund shall not exceed 5% of the lending fund’s net assets; (6) the duration of inter-fund loans will be limited to the time required to receive payment for securities sold, but in no event more than seven days; and (7) each inter-fund loan may be called on one business day’s notice by a lending fund and may be repaid on any day by a borrowing fund. In addition, a Nuveen fund may participate in the Inter-Fund Program only if and to the extent that such participation is consistent with the fund’s investment objective and investment policies. The Board is responsible for overseeing the Inter-Fund Program.
The limitations detailed above and the other conditions of the SEC exemptive order permitting the Inter-Fund Program are designed to minimize the risks associated with Inter-Fund Program for both the lending fund and the borrowing fund. However, no borrowing or lending activity is without risk. When a fund borrows money from another fund, there is a risk that the loan could be called on one day’s notice or not renewed, in which case the fund may have to borrow from a bank at a higher rate or take other actions to payoff such loan if an inter-fund loan is not available from another fund. Any delay in repayment to a lending fund could result in a lost investment opportunity or additional borrowing costs.
During the current reporting period, none of the Funds covered by this shareholder report have entered into any inter-fund loan activity.
10. Subsequent Events
Committed Line of Credit
During June 2022, the Participating Funds renewed the standby credit facility through June 2023. In conjunction with this renewal the commitment amount increased from $2.635 billion to $2.700 billion. The Participating Funds also incurred a 0.05% upfront fee on the increased commitments from select lenders. All other terms remain unchanged.
NID and NIQ Announce Shareholder Proposals
On June 14, 2022, the Board approved a proposal that will allow each Fund's shareholders the opportunity to maintain their investment in the Fund and its exposure to leveraged, intermediate duration municipal securities. In light of the upcoming scheduled terminations of NID on March 31, 2023 and NIQ on June 30, 2023, the proposal asks shareholders of each NID and NIQ to vote to amend their respective Fund's declaration of trust to eliminate the term structure at a special meeting of shareholders on October 12. For each Fund, if the amendment is approved by shareholders, the Fund will conduct a tender offer for 100% of its outstanding common shares at net asset value. If the Fund's common assets taking into account common shares properly tendered in the tender offer would be $70 million or greater, the tender offer will be completed and the Fund's term will be eliminated. If the Fund's common assets after the tender offer would be less than $70 million, the tender offer will be cancelled with no common shares repurchased, and instead, the Fund will proceed to terminate as scheduled.
As part of the proposal, if a Fund's term is eliminated, the Fund's name will change to reflect the elimination. NID's name will change to “Nuveen Intermediate Duration Municipal Fund” and NIQ's name will change to “Nuveen Intermediate Duration Quality Municipal Fund.” In addition, if a Fund's term is eliminated, the common shares of the Fund will continue to trade on the NYSE under the current ticker symbol, and Nuveen will waive 50% of its net management fees over the first year following the elimination of the term, which may enhance the net earnings of the Fund.
The changes described above will take effect with respect to a Fund only if shareholders of such Fund approves the proposal described above and the tender offer condition is satisfied for such Fund.
64
Shareholder Update
(Unaudited)
CURRENT INVESTMENT OBJECTIVES, INVESTMENT POLICIES AND PRINCIPAL RISKS OF THE FUNDS
NUVEEN INTERMEDIATE DURATION MUNICIPAL TERM FUND (NID)
Investment Objectives
The Fund’s primary investment objective is to provide a high level of current income exempt from regular federal income tax. The Fund’s secondary investment objective is to seek additional total return.
Investment Policies
As a fundamental policy, under normal circumstances, the Fund will invest at least 80% of its Assets (as defined below) in municipal securities and other related investments, the income from which is exempt from regular federal income tax.
Under the Fund’s Amended and Restated Declaration of Trust, dated October 11, 2012, on or before March 31, 2023 (the “Termination Date”), the Fund would cease its investment operations, liquidate its portfolio, retire or redeem leverage facilities and distribute its net assets to shareholders of record as of the date of termination. However, on June 14, 2022, the Fund’s Board of Trustees approved a proposal to amend the Fund’s declaration of trust to eliminate the Termination Date. If the amendment is approved by shareholders, the Fund will conduct a tender offer for 100% of its outstanding common shares at net asset value (“NAV”). If the Fund’s common assets taking into account common shares properly tendered in the tender offer would be $70 million or greater, the tender offer will be completed, the Fund’s Termination Date will be eliminated and the Fund would continue without limitation of time. If the Fund’s common assets after the tender offer would be less than $70 million, the tender offer will be cancelled with no common shares repurchased, and instead, the Fund will proceed to terminate as scheduled on the Termination Date.
The Fund invests in municipal securities that are exempt from federal income taxes, and seeks to maintain a portfolio with a levered effective duration of between 3 and 10 years, which takes into account the effects of leverage and optional call provisions of the municipal securities in the Fund’s portfolio.
“Assets” mean the net assets of the Fund plus the amount of any borrowings for investment purposes. “Managed Assets” mean the total assets of the Fund, minus the sum of its accrued liabilities (other than Fund liabilities incurred for the express purpose of creating leverage). Total assets for this purpose shall include assets attributable to the Fund’s use of leverage (whether or not those assets are reflected in the Fund’s financial statements for purposes of generally accepted accounting principles), and derivatives will be valued at their market value.
Under normal circumstances:
| • | The Fund may invest up to 20% of its Managed Assets in municipal securities that pay interest that is taxable under the federal alternative minimum tax applicable to individuals (“AMT Bonds”). |
| • | The Fund will invest at least 50% of its Managed Assets in municipal securities that at the time of investment are investment grade quality. A security is considered investment grade quality if it is rated within the four highest letter grades (BBB- or Baa3 or better) by at least one nationally recognized statistical rating organization (“NRSRO”) that rate such security (even if it is rated lower by another), or if it is unrated by any NRSRO but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund may invest up to 50% of its Managed Assets in municipal securities that at the time of investment are rated below investment grade or are unrated by any NRSRO but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund will maintain a levered effective duration ranging between three and ten years. |
| • | No more than 10% of the Fund’s Managed Assets may be invested in municipal securities rated below B3/B- or that are unrated but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund will not invest more than 25% of its Managed Assets in municipal securities in any one sector and no more than 5% of its Managed Assets in any one issuer. |
| • | No more than 10% of the Fund’s Managed Assets may be invested in “tobacco settlement bonds.” |
| • | The Fund may invest up to 10% of its Managed Assets in securities of other open- or closed-end investment companies (including exchange-traded funds (“ETFs”)) that invest primarily in municipal securities of the types in which the Fund may invest directly. |
65
Shareholder Update (Unaudited) (continued)
The foregoing
policies apply only at the time of any new investment.
Approving Changes in Investment Policies
The Board of Trustees of the Fund may change the policies described above without a shareholder vote. However, the Fund’s (i) investment objectives and (ii) policy of investing at least 80% of its Assets in municipal securities and other related investments, the income from which is exempt from regular federal income tax, may not be changed without the approval of the holders of a majority of the outstanding common shares and preferred shares voting together as a single class, and the approval of the holders of a majority of the outstanding preferred shares, voting separately as a single class. A “majority of the outstanding” shares means (i) 67% or more of the shares present at a meeting, if the holders of more than 50% of the shares are present or represented by proxy or (ii) more than 50% of the shares, whichever is less.
Portfolio Contents
The Fund generally invests in municipal securities. Municipal securities include municipal bonds, notes, securities issued to finance and refinance public projects, certificates of participation, variable rate demand obligations, lease obligations, municipal notes, pre-refunded municipal bonds, private activity bonds, securities issued by tender option bond trusts (“TOB trusts”), including inverse floating rate securities, and other forms of municipal bonds and securities, and other related instruments that create exposure to municipal bonds, notes and securities that provide for the payment of interest income that is exempt from regular U.S. federal income tax.
Municipal securities are debt obligations generally issued by states, cities and local authorities and certain possessions and territories of the United States (such as Puerto Rico and Guam) to finance or refinance public purpose projects such as roads, schools, and water supply systems.
The Fund may also invest in AMT Bonds. AMT Bonds may trigger adverse tax consequences for Fund shareholders who are subject to the federal alternative minimum tax.
The Fund may invest in municipal securities that represent lease obligations and certificates of participation in such leases. A municipal lease is an obligation in the form of a lease or installment purchase that is issued by a state or local government to acquire equipment and facilities. Income from such obligations generally is exempt from state and local taxes in the state of issuance. A certificate of participation represents an undivided interest in an unmanaged pool of municipal leases, an installment purchase agreement or other instruments. The certificates typically are issued by a municipal agency, a trust or other entity that has received an assignment of the payments to be made by the state or political subdivision under such leases or installment purchase agreements. Such certificates provide the Fund with the right to a pro rata undivided interest in the underlying municipal securities. In addition, such participations generally provide the Fund with the right to demand payment, on not more than seven days’ notice, of all or any part of the Fund’s participation interest in the underlying municipal securities, plus accrued interest.
The Fund may invest in municipal notes. Municipal securities in the form of notes generally are used to provide for short-term capital needs, in anticipation of an issuer’s receipt of other revenues or financing, and typically have maturities of up to three years. Such instruments may include tax anticipation notes, revenue anticipation notes, bond anticipation notes, tax and revenue anticipation notes and construction loan notes. Tax anticipation notes are issued to finance the working capital needs of governments. Generally, they are issued in anticipation of various tax revenues, such as income, sales, property, use and business taxes, and are payable from these specific future taxes. Revenue anticipation notes are issued in expectation of receipt of other kinds of revenue, such as federal revenues available under federal revenue sharing programs. Bond anticipation notes are issued to provide interim financing until long-term bond financing can be arranged. In most cases, the long-term bonds then provide the funds needed for repayment of the bond anticipation notes. Tax and revenue anticipation notes combine the funding sources of both tax anticipation notes and revenue anticipation notes. Construction loan notes are sold to provide construction financing. Mortgage notes insured by the Federal Housing Authority secure these notes; however, the proceeds from the insurance may be less than the economic equivalent of the payment of principal and interest on the mortgage note if there has been a default. The anticipated revenues from taxes, grants or bond financing generally secure the obligations of an issuer of municipal notes.
The Fund may invest in “tobacco settlement bonds.” Tobacco settlement bonds are municipal securities that are secured or payable solely from the collateralization of the proceeds from class action or other litigation against the tobacco industry.
The Fund may invest in pre-refunded municipal securities. The principal of and interest on pre-refunded municipal securities are no longer paid from the original revenue source for the securities. Instead, the source of such payments is typically an escrow fund consisting of U.S. government securities. The assets in the escrow fund are derived from the proceeds of refunding bonds issued by the same issuer as the pre-refunded municipal securities. Issuers of municipal securities use this advance refunding technique to obtain more favorable terms with respect to securities that are not yet subject to call or redemption by the issuer. For example, advance refunding enables an issuer to refinance debt at lower market interest rates, restructure debt to improve cash flow or eliminate restrictive covenants in the indenture or other governing instrument for the pre-refunded municipal securities. However, except for a change in the revenue source from which principal and interest payments are made, the pre-refunded municipal securities remain outstanding on their original terms until they mature or are redeemed by the issuer.
66
The Fund may invest in private activity bonds. Private activity bonds are issued by or on behalf of public authorities to obtain funds to provide privately operated housing facilities, airport, mass transit or port facilities, sewage disposal, solid waste disposal or hazardous waste treatment or disposal facilities and certain local facilities for water supply, gas or electricity. Other types of private activity bonds, the proceeds of which are used for the construction, equipment, repair or improvement of privately operated industrial or commercial facilities, may constitute municipal securities, although the current federal tax laws place substantial limitations on the size of such issues.
The Fund may invest in municipal securities issued by special taxing districts. Special taxing districts are organized to plan and finance infrastructure developments to induce residential, commercial and industrial growth and redevelopment. The bond financing methods such as tax increment finance, tax assessment, special services district and Mello-Roos bonds, are generally payable solely from taxes or other revenues attributable to the specific projects financed by the bonds without recourse to the credit or taxing power of related or overlapping municipalities.
The Fund may invest in zero coupon bonds. A zero coupon bond is a bond that typically does not pay interest for the entire life of the obligation or for an initial period after the issuance of the obligation.
The Fund may buy and sell securities on a when-issued or delayed delivery basis, making payment or taking delivery at a later date, normally within 15 to 45 days of the trade date.
The Fund may invest in inverse floating rate securities issued by a TOB trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. Typically, inverse floating rate securities represent beneficial interests in a special purpose trust (sometimes called a TOB trust) formed by a third party sponsor for the purpose of holding municipal bonds. Inverse floating rate securities may increase or decrease in value at a greater rate than the underlying interest rate on the municipal bond held by the TOB trust, which effectively leverages the Fund’s investment.
The Fund may invest in floating rate securities issued by special purpose trusts. Floating rate securities may take the form of short-term floating rate securities or the option period may be substantially longer. Generally, the interest rate earned will be based upon the market rates for municipal securities with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option, which may vary from weekly, to monthly, to extended periods of one year or multiple years. Since the option feature has a shorter term than the final maturity or first call date of the underlying bond deposited in the trust, the Fund as the holder of the floating rate security relies upon the terms of the agreement with the financial institution furnishing the option as well as the credit strength of that institution. As further assurance of liquidity, the terms of the trust provide for a liquidation of the municipal security deposited in the trust and the application of the proceeds to pay off the floating rate security. The trusts that are organized to issue both short-term floating rate securities and inverse floaters generally include liquidation triggers to protect the investor in the floating rate security.
The Fund may utilize structured notes and similar instruments for investment purposes and also for hedging purposes. Structured notes are privately negotiated debt obligations where the principal and/or interest is determined by reference to the performance of a benchmark asset, market or interest rate (an “embedded index”), such as selected securities, an index of securities or specified interest rates, or the differential performance of two assets or markets.
The Fund may invest in illiquid securities (i.e., securities that are not readily marketable), including, but not limited to, restricted securities (securities the disposition of which is restricted under the federal securities laws), securities that may be resold only pursuant to Rule 144A under the Securities Act of 1933, as amended (the “1933 Act”), and repurchase agreements with maturities in excess of seven days.
The Fund may enter into certain derivative instruments in pursuit of its investment objectives, including to seek to enhance return, to hedge certain risks of its investments in municipal securities or as a substitute for a position in the underlying asset. Such instruments include financial futures contracts, swap contracts (including interest rate swaps, credit default swaps and municipal market data rate locks (“MMD Rate Locks”)), options on financial futures, options on swap contracts or other derivative instruments.
The Fund may purchase and sell MMD Rate Locks. An MMD Rate Lock permits the Fund to lock in a specified municipal interest rate for a portion of its portfolio to preserve a return on a particular investment or a portion of its portfolio as a duration management technique or to protect against any increase in the price of securities to be purchased at a later date. By using an MMD Rate Lock, the Fund can create a synthetic long or short position, allowing the Fund to select what the manager believes is an attractive part of the yield curve. The Fund will ordinarily use these transactions as a hedge or for duration or risk management although it is permitted to enter into them to enhance income or gain or to increase the Fund’s yield, for example, during periods of steep interest rate yield curves (i.e., wide differences between short term and long term interest rates).
The Fund may also invest in securities of other open- or closed-end investment companies (including ETFs) that invest primarily in municipal securities of the types in which the Fund may invest directly, to the extent permitted by the Investment Company Act of 1940, as amended (the “1940 Act”), the rules and regulations issued thereunder and applicable exemptive orders issued by the Securities and Exchange Commission (“SEC”).
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Shareholder Update (Unaudited) (continued)
Use of Leverage
The Fund uses leverage to pursue its investment objectives. The Fund may use leverage to the extent permitted by the 1940 Act. The Fund may source leverage through a number of methods including the issuance of preferred shares of beneficial interest (“Preferred Shares”) and investments in inverse floating rate securities. As a fundamental policy, the Fund may not issue debt securities or Preferred Shares that rank senior to any outstanding Preferred Shares issued by the Fund. Additionally, as a fundamental policy, the Fund may not borrow money, except from banks for temporary or emergency purposes, or to repurchase its shares. In addition, the Fund may also use certain derivatives that have the economic effect of leverage by creating additional investment exposure. The amount and sources of leverage will vary depending on market conditions.
Temporary Defensive Periods
During temporary defensive periods (e.g., times when, in the Fund’s investment adviser’s and/or the Fund’s sub-adviser’s opinion, temporary imbalances of supply and demand or other temporary dislocations in the tax-exempt bond market adversely affect the price at which intermediate-term municipal securities are available), the Fund may invest up to 100% of its net assets in cash or cash equivalents, short-term investments or municipal bonds and deviate from its investment policies including the Fund’s 80% names rule policy. Also, during these periods, the effective duration of the Fund’s investment portfolio may fall below the effective duration range of between 3 and 10 years and the Fund may not achieve its investment objectives.
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NUVEEN INTERMEDIATE DURATION QUALITY MUNICIPAL TERM FUND (NIQ)
Investment Objectives
The Fund’s primary investment objective is to provide current income exempt from regular federal income tax. The Fund’s secondary investment objective is to seek additional total return.
Investment Policies
As a fundamental policy, under normal circumstances, the Fund will invest at least 80% of its Assets (as defined below) in municipal securities and other related investments, the income from which is exempt from regular federal income tax.
Under the Fund’s Declaration of Trust, dated December 11, 2012, on or before June 30, 2023 (the “Termination Date”), the Fund would cease its investment operations, liquidate its portfolio, retire or redeem leverage facilities and distribute its net assets to shareholders of record as of the date of termination. However, on June 14, 2022, the Fund’s Board of Trustees approved a proposal to amend the Fund’s declaration of trust to eliminate the Termination Date. If the amendment is approved by shareholders, the Fund will conduct a tender offer for 100% of its outstanding common shares at net asset value (“NAV”). If the Fund’s common assets taking into account common shares properly tendered in the tender offer would be $70 million or greater, the tender offer will be completed, the Fund’s Termination Date will be eliminated and the Fund would continue without limitation of time. If the Fund’s common assets after the tender offer would be less than $70 million, the tender offer will be cancelled with no common shares repurchased, and instead, the Fund will proceed to terminate as scheduled on the Termination Date.
The Fund invests in municipal securities that are exempt from federal income taxes, and seeks to maintain a portfolio with a levered effective duration of between 3 and 10 years, which takes into account the effects of leverage and optional call provisions of the municipal securities in the Fund’s portfolio.
“Assets” mean the net assets of the Fund plus the amount of any borrowings for investment purposes. “Managed Assets” mean the total assets of the Fund, minus the sum of its accrued liabilities (other than Fund liabilities incurred for the express purpose of creating leverage). Total assets for this purpose shall include assets attributable to the Fund’s use of leverage (whether or not those assets are reflected in the Fund’s financial statements for purposes of generally accepted accounting principles), and derivatives will be valued at their market value.
Under normal circumstances:
| • | The Fund may invest up to 20% of its Managed Assets in AMT Bonds. |
| • | The Fund will invest at least 80% of its Managed Assets in municipal securities that at the time of investment are investment grade quality. A security is considered investment grade quality if it is rated within the four highest letter grades (BBB- or Baa3 or better) by at least one NRSRO that rates such security (even if it is rated lower by another), or if it is unrated by any NRSRO but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund may invest up to 20% of its Managed Assets in municipal securities that at the time of investment are rated below investment grade or are unrated by any NRSRO but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund will maintain a levered effective duration ranging between three and ten years. |
| • | No more than 10% of the Fund’s Managed Assets may be invested in municipal securities rated below B3/B- or that are unrated but judged to be of comparable quality by the Fund’s sub-adviser. |
| • | The Fund will not invest more than 25% of its Managed Assets in municipal securities in any one sector and no more than 5% of its Managed Assets in any one issuer. |
| • | No more than 10% of the Fund’s Managed Assets may be invested in “tobacco settlement bonds.” |
| • | The Fund may invest up to 10% of its Managed Assets in securities of other open- or closed-end investment companies (including ETFs) that invest primarily in municipal securities of the types in which the Fund may invest directly. |
The foregoing
policies apply only at the time of any new investment.
Approving Changes in Investment Policies
The Board of Trustees of the Fund may change the policies described above without a shareholder vote. However, the Fund’s (i) investment objectives and (ii) policy of investing at least 80% of its Assets in municipal securities and other related investments, the income from which is exempt from regular federal income tax, may not be changed without the approval of the holders of a majority of the outstanding common shares and preferred shares voting together as a single class, and the approval of the holders of a majority of the outstanding preferred shares, voting separately as a single class. A
69
Shareholder Update (Unaudited) (continued)
“majority of the outstanding” shares means (i) 67% or more of the shares present at a meeting, if the holders of more than 50% of the shares are present or represented by proxy or (ii) more than 50% of the shares, whichever is less.
However, with respect to the Fund’s policy of investing at least 80% of its Managed Assets in municipal securities that at the time of investment are investment grade quality, such policy may not be changed without 60 days’ prior written notice to Common Shareholders.
Portfolio Contents
The Fund generally invests in municipal securities. Municipal securities include municipal bonds, notes, securities issued to finance and refinance public projects, certificates of participation, variable rate demand obligations, lease obligations, municipal notes, pre-refunded municipal bonds, private activity bonds, securities issued by TOB trusts, including inverse floating rate securities, and other forms of municipal bonds and securities, and other related instruments that create exposure to municipal bonds, notes and securities that provide for the payment of interest income that is exempt from regular U.S. federal income tax.
Municipal securities are debt obligations generally issued by states, cities and local authorities and certain possessions and territories of the United States (such as Puerto Rico and Guam) to finance or refinance public purpose projects such as roads, schools, and water supply systems.
The Fund may also invest in AMT Bonds. AMT Bonds may trigger adverse tax consequences for Fund shareholders who are subject to the federal alternative minimum tax.
The Fund may invest in municipal securities that represent lease obligations and certificates of participation in such leases. A municipal lease is an obligation in the form of a lease or installment purchase that is issued by a state or local government to acquire equipment and facilities. Income from such obligations generally is exempt from state and local taxes in the state of issuance. A certificate of participation represents an undivided interest in an unmanaged pool of municipal leases, an installment purchase agreement or other instruments. The certificates typically are issued by a municipal agency, a trust or other entity that has received an assignment of the payments to be made by the state or political subdivision under such leases or installment purchase agreements. Such certificates provide the Fund with the right to a pro rata undivided interest in the underlying municipal securities. In addition, such participations generally provide the Fund with the right to demand payment, on not more than seven days’ notice, of all or any part of the Fund’s participation interest in the underlying municipal securities, plus accrued interest.
The Fund may invest in municipal notes. Municipal securities in the form of notes generally are used to provide for short-term capital needs, in anticipation of an issuer’s receipt of other revenues or financing, and typically have maturities of up to three years. Such instruments may include tax anticipation notes, revenue anticipation notes, bond anticipation notes, tax and revenue anticipation notes and construction loan notes. Tax anticipation notes are issued to finance the working capital needs of governments. Generally, they are issued in anticipation of various tax revenues, such as income, sales, property, use and business taxes, and are payable from these specific future taxes. Revenue anticipation notes are issued in expectation of receipt of other kinds of revenue, such as federal revenues available under federal revenue sharing programs. Bond anticipation notes are issued to provide interim financing until long-term bond financing can be arranged. In most cases, the long-term bonds then provide the funds needed for repayment of the bond anticipation notes. Tax and revenue anticipation notes combine the funding sources of both tax anticipation notes and revenue anticipation notes. Construction loan notes are sold to provide construction financing. Mortgage notes insured by the Federal Housing Authority secure these notes; however, the proceeds from the insurance may be less than the economic equivalent of the payment of principal and interest on the mortgage note if there has been a default. The anticipated revenues from taxes, grants or bond financing generally secure the obligations of an issuer of municipal notes.
The Fund may invest in “tobacco settlement bonds.” Tobacco settlement bonds are municipal securities that are secured or payable solely from the collateralization of the proceeds from class action or other litigation against the tobacco industry.
The Fund may invest in pre-refunded municipal securities. The principal of and interest on pre-refunded municipal securities are no longer paid from the original revenue source for the securities. Instead, the source of such payments is typically an escrow fund consisting of U.S. government securities. The assets in the escrow fund are derived from the proceeds of refunding bonds issued by the same issuer as the pre-refunded municipal securities. Issuers of municipal securities use this advance refunding technique to obtain more favorable terms with respect to securities that are not yet subject to call or redemption by the issuer. For example, advance refunding enables an issuer to refinance debt at lower market interest rates, restructure debt to improve cash flow or eliminate restrictive covenants in the indenture or other governing instrument for the pre-refunded municipal securities. However, except for a change in the revenue source from which principal and interest payments are made, the pre-refunded municipal securities remain outstanding on their original terms until they mature or are redeemed by the issuer.
The Fund may invest in private activity bonds. Private activity bonds are issued by or on behalf of public authorities to obtain funds to provide privately operated housing facilities, airport, mass transit or port facilities, sewage disposal, solid waste disposal or hazardous waste treatment or disposal facilities and certain local facilities for water supply, gas or electricity. Other types of private activity bonds, the proceeds of which are used for the construction, equipment, repair or improvement of privately operated industrial or commercial facilities, may constitute municipal securities, although the current federal tax laws place substantial limitations on the size of such issues.
70
The Fund may invest in municipal securities issued by special taxing districts. Special taxing districts are organized to plan and finance infrastructure developments to induce residential, commercial and industrial growth and redevelopment. The bond financing methods such as tax increment finance, tax assessment, special services district and Mello-Roos bonds, are generally payable solely from taxes or other revenues attributable to the specific projects financed by the bonds without recourse to the credit or taxing power of related or overlapping municipalities.
The Fund may invest in zero coupon bonds. A zero coupon bond is a bond that typically does not pay interest for the entire life of the obligation or for an initial period after the issuance of the obligation.
The Fund may buy and sell securities on a when-issued or delayed delivery basis, making payment or taking delivery at a later date, normally within 15 to 45 days of the trade date.
The Fund may invest in inverse floating rate securities issued by a TOB trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. Typically, inverse floating rate securities represent beneficial interests in a special purpose trust (sometimes called a TOB trust) formed by a third party sponsor for the purpose of holding municipal bonds. Inverse floating rate securities may increase or decrease in value at a greater rate than the underlying interest rate on the municipal bond held by the TOB trust, which effectively leverages the Fund’s investment.
The Fund may invest in floating rate securities issued by special purpose trusts. Floating rate securities may take the form of short-term floating rate securities or the option period may be substantially longer. Generally, the interest rate earned will be based upon the market rates for municipal securities with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option, which may vary from weekly, to monthly, to extended periods of one year or multiple years. Since the option feature has a shorter term than the final maturity or first call date of the underlying bond deposited in the trust, the Fund as the holder of the floating rate security relies upon the terms of the agreement with the financial institution furnishing the option as well as the credit strength of that institution. As further assurance of liquidity, the terms of the trust provide for a liquidation of the municipal security deposited in the trust and the application of the proceeds to pay off the floating rate security. The trusts that are organized to issue both short-term floating rate securities and inverse floaters generally include liquidation triggers to protect the investor in the floating rate security.
The Fund may utilize structured notes and similar instruments for investment purposes and also for hedging purposes. Structured notes are privately negotiated debt obligations where the principal and/or interest is determined by reference to the performance of a benchmark asset, market or interest rate (an “embedded index”), such as selected securities, an index of securities or specified interest rates, or the differential performance of two assets or markets.
The Fund may invest in illiquid securities (i.e., securities that are not readily marketable), including, but not limited to, restricted securities (securities the disposition of which is restricted under the federal securities laws), securities that may be resold only pursuant to Rule 144A under the 1933 Act, and repurchase agreements with maturities in excess of seven days.
The Fund may enter into certain derivative instruments in pursuit of its investment objectives, including to seek to enhance return, to hedge certain risks of its investments in municipal securities or as a substitute for a position in the underlying asset. Such instruments include financial futures contracts, swap contracts (including interest rate swaps, credit default swaps and MMD Rate Locks), options on financial futures, options on swap contracts or other derivative instruments.
The Fund may purchase and sell MMD Rate Locks. An MMD Rate Lock permits the Fund to lock in a specified municipal interest rate for a portion of its portfolio to preserve a return on a particular investment or a portion of its portfolio as a duration management technique or to protect against any increase in the price of securities to be purchased at a later date. By using an MMD Rate Lock, the Fund can create a synthetic long or short position, allowing the Fund to select what the manager believes is an attractive part of the yield curve. The Fund will ordinarily use these transactions as a hedge or for duration or risk management although it is permitted to enter into them to enhance income or gain or to increase the Fund’s yield, for example, during periods of steep interest rate yield curves (i.e., wide differences between short term and long term interest rates).
The Fund may also invest in securities of other open- or closed-end investment companies (including ETFs) that invest primarily in municipal securities of the types in which the Fund may invest directly, to the extent permitted by the 1940 Act, the rules and regulations issued thereunder and applicable exemptive orders issued by the SEC.
Use of Leverage
The Fund uses leverage to pursue its investment objectives. The Fund may use leverage to the extent permitted by the 1940 Act. The Fund may source leverage through a number of methods including the issuance of Preferred Shares and investments in inverse floating rate securities. As a fundamental policy, the Fund may not issue debt securities or Preferred Shares that rank senior to any outstanding Preferred Shares issued by the Fund. Additionally, as a fundamental policy, the Fund may not borrow money, except from banks for temporary or emergency purposes, or to repurchase its shares. In addition, the Fund may also use certain derivatives that have the economic effect of leverage by creating additional investment exposure. The amount and sources of leverage will vary depending on market conditions.
71
Shareholder Update (Unaudited) (continued)
Temporary Defensive Periods
During temporary defensive periods (e.g., times when, in the Fund’s investment adviser’s and/or the Fund’s sub-adviser’s opinion, temporary imbalances of supply and demand or other temporary dislocations in the tax-exempt bond market adversely affect the price at which intermediate-term municipal securities are available), the Fund may invest up to 100% of its net assets in cash or cash equivalents, short-term investments or municipal bonds and deviate from its investment policies including the Fund’s 80% names rule policy. Also, during these periods, the effective duration of the Fund’s investment portfolio may fall below the effective duration range of between 3 and 10 years and the Fund may not achieve its investment objectives.
72
PRINCIPAL RISKS OF THE FUNDS
The factors that are most likely to have a material effect on a particular Fund’s portfolio as a whole are called “principal risks.” Each Fund is subject to the principal risks indicated below, whether through direct investment or derivative positions. Each Fund may be subject to additional risks other than those identified and described below because the types of investments made by a Fund can change over time.
| Nuveen | ||
| Nuveen | Intermediate | |
| Intermediate | Duration | |
| Duration | Quality | |
| Municipal | Municipal | |
| Term | Term | |
| Fund | Fund | |
| Risk | (NID) | (NIQ) |
| Portfolio Level Risks | ||
| Alternative Minimum Tax Risk | X | X |
| Below Investment Grade Risk | X | X |
| Call Risk | X | X |
| Credit Risk | X | X |
| Credit Spread Risk | X | X |
| Defaulted and Distressed Securities Risk | X | X |
| Deflation Risk | X | X |
| Derivatives Risk | X | X |
| Duration Risk | X | X |
| Economic Sector Risk | X | X |
| Financial Futures and Options Risk | X | X |
| Hedging Risk | X | X |
| Illiquid Investments Risk | X | X |
| Income Risk | X | X |
| Inflation Risk | X | X |
| Insurance Risk | X | X |
| Interest Rate Risk | X | X |
| Inverse Floating Rate Securities Risk | X | X |
| London Interbank Offered Rate (“LIBOR”) Replacement Risk | X | X |
| Municipal Securities Market Liquidity Risk | X | X |
| Municipal Securities Market Risk | X | X |
| Other Investment Companies Risk | X | X |
| Puerto Rico Municipal Securities Market Risk | X | X |
| Reinvestment Risk | X | X |
| Sector and Industry Risk | X | X |
| Sector Focus Risk | X | X |
| Special Risks Related to Certain Municipal Obligations | X | X |
| Swap Transactions Risk | X | X |
| Tax Risk | X | X |
| Taxability Risk | X | X |
| Tobacco Settlement Bond Risk | X | X |
| Unrated Securities Risk | X | X |
| Valuation Risk | X | X |
| Zero Coupon Bonds Risk | X | X |
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Shareholder Update (Unaudited) (continued)
| Nuveen | ||
| Nuveen | Intermediate | |
| Intermediate | Duration | |
| Duration | Quality | |
| Municipal | Municipal | |
| Term | Term | |
| Fund | Fund | |
| Risk | (NID) | (NIQ) |
| Fund Level and Other Risks | ||
| Anti-Takeover Provisions | X | X |
| Counterparty Risk | X | X |
| Cybersecurity Risk | X | X |
| Economic and Political Events Risk | X | X |
| Global Economic Risk | X | X |
| Investment and Market Risk | X | X |
| Legislation and Regulatory Risk | X | X |
| Leverage Risk | X | X |
| Limited Term Risk | X | X |
| Market Discount from Net Asset Value | X | X |
| Recent Market Conditions | X | X |
| Reverse Repurchase Agreement Risk | X | X |
Portfolio Level Risks:
Alternative Minimum Tax Risk. The Fund may invest in AMT Bonds. Therefore, a portion of the Fund’s otherwise exempt-interest dividends may be taxable to those shareholders subject to the federal alternative minimum tax.
Below Investment Grade Risk. Municipal securities of below investment grade quality are regarded as having speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal, and may be subject to higher price volatility and default risk than investment grade municipal securities of comparable terms and duration. Issuers of lower grade municipal securities may be highly leveraged and may not have available to them more traditional methods of financing. The prices of these lower grade securities are typically more sensitive to negative developments, such as a decline in the issuer’s revenues or a general economic downturn. The secondary market for lower rated municipal securities may not be as liquid as the secondary market for more highly rated municipal securities, a factor which may have an adverse effect on the Fund’s ability to dispose of a particular municipal security. If a below investment grade municipal security goes into default, or its issuer enters bankruptcy, it might be difficult to sell that security in a timely manner at a reasonable price.
Call Risk. The Fund may invest in municipal securities that are subject to call risk. Such municipal securities may be redeemed at the option of the issuer, or “called,” before their stated maturity or redemption date. In general, an issuer will call its instruments if they can be refinanced by issuing new instruments that bear a lower interest rate. The Fund is subject to the possibility that during periods of falling interest rates, an issuer will call its high yielding municipal securities. The Fund would then be forced to invest the unanticipated proceeds at lower interest rates, resulting in a decline in the Fund’s income.
Credit Risk. Issuers of municipal securities in which the Fund may invest may default on their obligations to pay principal or interest when due. This non-payment would result in a reduction of income to the Fund, a reduction in the value of a municipal security experiencing non-payment and potentially a decrease in the NAV of the Fund. To the extent that the credit rating assigned to a municipal security in the Fund’s portfolio is downgraded, the market price and liquidity of such security may be adversely affected.
Credit Spread Risk. Credit spread risk is the risk that credit spreads (i.e., the difference in yield between securities that is due to differences in their credit quality) may increase when the market believes that municipal securities generally have a greater risk of default. Increasing credit spreads may reduce the market values of the Fund’s securities. Credit spreads often increase more for lower rated and unrated securities than for investment grade securities. In addition, when credit spreads increase, reductions in market value will generally be greater for longer-maturity securities.
Defaulted and Distressed Securities Risk. The Fund may invest in securities of an issuer that is in default or that is in bankruptcy or insolvency proceedings at the time of purchase. In addition, the Fund may hold investments that at the time of purchase are not in default or involved in bankruptcy or insolvency proceedings, but may later become so. Moreover, the Fund may invest in low-rated securities that, although not in default, may be “distressed,” meaning that the issuer is experiencing financial difficulties or distress at the time of acquisition. Such securities would present a substantial risk of future default which may cause the Fund to incur losses, including additional expenses, to the extent it is required to seek recovery upon a default in the payment of principal or interest on those securities. In any reorganization or liquidation proceeding relating to a portfolio security,
74
the Fund may lose its entire investment or may be required to accept cash or securities with a value less than its original investment. Defaulted or distressed securities may be subject to restrictions on resale.
Deflation Risk. Deflation risk is the risk that prices throughout the economy decline over time. Deflation may have an adverse effect on the creditworthiness of issuers and may make issuer default more likely, which may result in a decline in the value of the Fund’s portfolio.
Derivatives Risk. The use of derivatives involves additional risks and transaction costs which could leave the Fund in a worse position than if it had not used these instruments. Derivative instruments can be used to acquire or to transfer the risk and returns of a municipal security or other asset without buying or selling the municipal security or asset. These instruments may entail investment exposures that are greater than their cost would suggest. As a result, a small investment in derivatives can result in losses that greatly exceed the original investment. Derivatives can be highly volatile, illiquid and difficult to value. An over-the-counter derivative transaction between the Fund and a counterparty that is not cleared through a central counterparty also involves the risk that a loss may be sustained as a result of the failure of the counterparty to the contract to make required payments. The payment obligation for a cleared derivative transaction is guaranteed by a central counterparty, which exposes the Fund to the creditworthiness of the central counterparty.
It is possible that regulatory or other developments in the derivatives market, including the SEC’s recently adopted new Rule 18f-4 under the 1940 Act, which imposes limits on the amount of derivatives a fund can enter into could adversely impact the Fund’s ability to successfully use derivative instruments.
Duration Risk. Duration is the sensitivity, expressed in years, of the price of a fixed-income security to changes in the general level of interest rates (or yields). Securities with longer durations tend to be more sensitive to interest rate (or yield) changes, which typically corresponds to increased volatility and risk, than securities with shorter durations. For example, if a security or portfolio has a duration of three years and interest rates increase by 1%, then the security or portfolio would decline in value by approximately 3%. Duration differs from maturity in that it considers potential changes to interest rates, and a security’s coupon payments, yield, price and par value and call features, in addition to the amount of time until the security matures. The duration of a security will be expected to change over time with changes in market factors and time to maturity.
Economic Sector Risk. The Fund may invest a significant amount of its total assets in municipal securities in the same economic sector. This may make the Fund more susceptible to adverse economic, political or regulatory occurrences affecting an economic sector. As concentration increases, so does the potential for fluctuation in the value of the Fund’s assets. In addition, the Fund may invest a significant portion of its assets in certain sectors of the municipal securities market, such as health care facilities, private educational facilities, special taxing districts and start-up utility districts, and private activity bonds including industrial development bonds on behalf of transportation companies, whose credit quality and performance may be more susceptible to economic, business, political, regulatory and other developments than other sectors of municipal issuers. If the Fund invests a significant portion of its assets in the sectors noted above, the Fund’s performance may be subject to additional risk and variability.
Financial Futures and Options Transactions Risk. The Fund may use certain transactions for hedging the portfolio’s exposure to credit risk and the risk of increases in interest rates, which could result in poorer overall performance for the Fund. There may be an imperfect correlation between price movements of the futures and options and price movements of the portfolio securities being hedged.
If the Fund engages in futures transactions or in the writing of options on futures, it will be required to maintain initial margin and maintenance margin and may be required to make daily variation margin payments in accordance with applicable rules of the exchanges and the Commodity Futures Trading Commission (“CFTC”). If the Fund purchases a financial futures contract or a call option or writes a put option in order to hedge the anticipated purchase of municipal securities, and if the Fund fails to complete the anticipated purchase transaction, the Fund may have a loss or a gain on the futures or options transaction that will not be offset by price movements in the municipal securities that were the subject of the anticipatory hedge. There can be no assurance that a liquid market will exist at a time when the Fund seeks to close out a derivatives or futures or a futures option position, and the Fund would remain obligated to meet margin requirements until the position is closed.
Hedging Risk. The Fund’s use of derivatives or other transactions to reduce risk involves costs and will be subject to the investment adviser’s and/or the sub-adviser’s ability to predict correctly changes in the relationships of such hedge instruments to the Fund’s portfolio holdings or other factors. No assurance can be given that the investment adviser’s and/or the sub-adviser’s judgment in this respect will be correct, and no assurance can be given that the Fund will enter into hedging or other transactions at times or under circumstances in which it may be advisable to do so. Hedging activities may reduce the Fund’s opportunities for gain by offsetting the positive effects of favorable price movements and may result in net losses.
Illiquid Investments Risk. Illiquid investments are investments that are not readily marketable. These investments may include restricted investments, including Rule 144A securities, which cannot be resold to the public without an effective registration statement under the 1933 Act, or, if they are unregistered, may be sold only in a privately negotiated transaction or pursuant to an exemption from registration. The Fund may not be able to readily dispose of such investments at prices that approximate those at which the Fund could sell such investments if they were more widely traded and, as a result of such illiquidity, the Fund may have to sell other investments or engage in borrowing transactions if necessary to raise cash to meet its obligations. Limited liquidity can also affect the market price of investments, thereby adversely affecting the Fund’s NAV and ability to make dividend distributions. The financial markets in general have in recent years experienced periods of extreme secondary market supply and demand imbalance, resulting in a loss of
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Shareholder Update (Unaudited) (continued)
liquidity during which market prices were suddenly and substantially below traditional measures of intrinsic value. During such periods, some investments could be sold only at arbitrary prices and with substantial losses. Periods of such market dislocation may occur again at any time.
Income Risk. The Fund’s income could decline due to falling market interest rates. This is because, in a falling interest rate environment, the Fund generally will have to invest the proceeds from maturing portfolio securities in lower-yielding securities.
Inflation Risk. Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value of money. As inflation increases, the real value of the common shares and distributions can decline. Currently, inflation rates are elevated relative to normal market conditions and could continue to increase.
Insurance Risk. The Fund may purchase municipal securities that are secured by insurance, bank credit agreements or escrow accounts. The credit quality of the companies that provide such credit enhancements will affect the value of those securities. Certain significant providers of insurance for municipal securities have incurred significant losses as a result of exposure to sub-prime mortgages and other lower credit quality investments. As a result, such losses reduced the insurers’ capital and called into question their continued ability to perform their obligations under such insurance if they are called upon to do so in the future. While an insured municipal security will typically be deemed to have the rating of its insurer, if the insurer of a municipal security suffers a downgrade in its credit rating or the market discounts the value of the insurance provided by the insurer, the value of the municipal security would more closely, if not entirely, reflect such rating. In such a case, the value of insurance associated with a municipal security may not add any value. The insurance feature of a municipal security does not guarantee the full payment of principal and interest through the life of an insured obligation, the market value of the insured obligation or the NAV of the common shares represented by such insured obligation.
Interest Rate Risk. Interest rate risk is the risk that municipal securities in the Fund’s portfolio will decline in value because of changes in market interest rates. Generally, when market interest rates rise, the market value of such securities will fall, and vice versa. As interest rates decline, issuers of municipal securities may prepay principal earlier than scheduled, forcing the Fund to reinvest in lower-yielding securities and potentially reducing the Fund’s income. As interest rates increase, slower than expected principal payments may extend the average life of municipal securities, potentially locking in a below-market interest rate and reducing the Fund’s value. In typical market interest rate environments, the prices of longer-term municipal securities generally fluctuate more than prices of shorter-term municipal securities as interest rates change. The risks associated with rising interest rates are greatly heightened in view of the US Federal Reserve Bank’s decision to raise the federal funds rate from historic lows, and may continue to raise interest rates if considered necessary to reduce the inflation to acceptable levels.
Inverse Floating Rate Securities Risk. The Fund may invest in inverse floating rate securities. In general, income on inverse floating rate securities will decrease when short-term interest rates increase and increase when short-term interest rates decrease. Investments in inverse floating rate securities may subject the Fund to the risks of reduced or eliminated interest payments and losses of principal. In addition, inverse floating rate securities may increase or decrease in value at a greater rate than the underlying interest rate, which effectively leverages the Fund’s investment. As a result, the market value of such securities generally will be more volatile than that of fixed rate securities.
The Fund may invest in inverse floating rate securities issued by special purpose trusts that have recourse to the Fund (i.e., the Fund typically bears the risk of loss with respect to any liquidity shortfall). In such instances, the Fund may be at risk of loss that exceeds its investment in the inverse floating rate securities.
The Fund may be required to sell its inverse floating rate securities at less than favorable prices, or liquidate other Fund portfolio holdings in certain circumstances, including, but not limited to, the following:
| • | If the Fund has a need for cash and the securities in a special purpose trust are not actively traded due to adverse market conditions; |
| • | If special purpose trust sponsors (as a collective group or individually) experience financial hardship and consequently seek to terminate their respective outstanding special purpose trusts; and |
| • | If the value of an underlying security declines significantly and if additional collateral has not been posted by the Fund. |
London Interbank Offered Rate (“LIBOR”) Replacement Risk. LIBOR is an index rate that historically has been widely used in lending transactions and remains a common reference rate for setting the floating interest rate on private loans. The use of the LIBOR will begin to be phased out in the near future, which may adversely affect the Fund’s investments whose value is tied to LIBOR. While the Secured Overnight Financing Rate (“SOFR”) has been recommended as the replacement rate for LIBOR, and some product markets have adopted the use of SOFR, LIBOR may still be used as a reference rate until such time that private markets have fully transitioned to using SOFR or other alternative reference rates recommended by applicable market regulators. The transition process away from LIBOR may involve, among other things, increased volatility or illiquidity in markets for instruments that currently rely on LIBOR. The potential effect of a discontinuation of LIBOR on the Fund’s investments will vary depending on, among other things: (1) existing fallback provisions that provide a replacement reference rate if LIBOR is no longer available; (2) termination provisions in individual contracts; and (3) how, and when industry participants develop and adopt new reference rates and fallbacks for both legacy and new products and instruments held by the Fund. Accordingly, it is difficult to predict the full impact of the transition away from LIBOR until it is clearer how the Fund’s products and instruments will be impacted by this transition.
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Municipal Securities Market Liquidity Risk. Inventories of municipal securities held by brokers and dealers have decreased in recent years, lessening their ability to make a market in these securities. This reduction in market making capacity has the potential to decrease the Fund’s ability to buy or sell municipal securities at attractive prices, and increase municipal security price volatility and trading costs, particularly during periods of economic or market stress. In addition, recent federal banking regulations may cause certain dealers to reduce their inventories of municipal securities, which may further decrease the Fund’s ability to buy or sell municipal securities. As a result, the Fund may be forced to accept a lower price to sell a security, to sell other securities to raise cash, or to give up an investment opportunity, any of which could have a negative effect on performance. If the Fund needed to sell large blocks of municipal securities to raise cash to meet its obligations, those sales could further reduce the municipal securities’ prices and hurt performance.
Municipal Securities Market Risk. The amount of public information available about the municipal securities in the Fund’s portfolio is generally less than that for corporate equities or bonds, and the investment performance of the Fund may therefore be more dependent on the analytical abilities of the sub-adviser than if the Fund were a stock fund or taxable bond fund. The secondary market for municipal securities, particularly below investment grade municipal securities, also tends to be less well-developed or liquid than many other securities markets, which may adversely affect the Fund’s ability to sell its municipal securities at attractive prices.
Other Investment Companies Risk. The Fund may invest in the securities of other investment companies, including ETFs. Investing in an investment company exposes the Fund to all of the risks of that investment company’s investments. The Fund, as a holder of the securities of other investment companies, will bear its pro rata portion of the other investment companies’ expenses, including advisory fees. These expenses are in addition to the direct expenses of the Fund’s own operations. As a result, the cost of investing in investment company shares may exceed the costs of investing directly in its underlying investments. In addition, securities of other investment companies may be leveraged. As a result, the Fund may be indirectly exposed to leverage through an investment in such securities and therefore magnify the Fund’s leverage risk.
With respect to ETF’s, an ETF that is based on a specific index may not be able to replicate and maintain exactly the composition and relative weighting of securities in the index. The value of an ETF based on a specific index is subject to change as the values of its respective component assets fluctuate according to market volatility. ETFs typically rely on a limited pool of authorized participants to create and redeem shares, and an active trading market for ETF shares may not develop or be maintained. The market value of shares of ETFs and closed-end funds may differ from their NAV.
Puerto Rico Municipal Securities Market Risk. To the extent that the Fund invests a significant portion of its assets in the securities issued by the Commonwealth of Puerto Rico or its political subdivisions, agencies, instrumentalities, or public corporations (collectively referred to as “Puerto Rico” or the “Commonwealth”), it will be disproportionally affected by political, social and economic conditions and developments in the Commonwealth. In addition, economic, political or regulatory changes in that territory could adversely affect the value of the Fund’s investment portfolio.
Puerto Rico currently is experiencing significant fiscal and economic challenges, including substantial debt service obligations, high levels of unemployment, underfunded public retirement systems, and persistent government budget deficits. These challenges may negatively affect the value of the Fund’s investments in Puerto Rican municipal securities. Several major ratings agencies have downgraded the general obligation debt of Puerto Rico to below investment grade and continue to maintain a negative outlook for this debt, which increases the likelihood that the rating will be lowered further. Puerto Rico recently defaulted on its debt by failing to make full payment due on its outstanding bonds, and there can be no assurance that Puerto Rico will be able to satisfy its future debt obligations. Further downgrades or defaults may place additional strain on the Puerto Rico economy and may negatively affect the value, liquidity, and volatility of the Fund’s investments in Puerto Rican municipal securities. Additionally, numerous issuers have entered Title III of the Puerto Rico Oversite, Management and Economic Stability Act (“PROMESA”), which is similar to bankruptcy protection, through which the Commonwealth of Puerto Rico can restructure its debt. However, Puerto Rico’s case is the first ever heard under PROMESA and there is no existing case precedent to guide the proceedings. Accordingly, Puerto Rico’s debt restructuring process could take significantly longer than traditional municipal bankruptcy proceedings. Further, it is not clear whether a debt restructuring process will ultimately be approved or, if so, the extent to which it will apply to Puerto Rico municipal securities sold by an issuer other than the territory. A debt restructuring could reduce the principal amount due, the interest rate, the maturity, and other terms of Puerto Rico municipal securities, which could adversely affect the value of Puerto Rican municipal securities. Legislation that would allow Puerto Rico to restructure its municipal debt obligations, thus increasing the risk that Puerto Rico may never pay off municipal indebtedness, or may pay only a small fraction of the amount owed, could also impact the value of the Fund’s investments in Puerto Rican municipal securities.
These challenges and uncertainties have been exacerbated by multiple hurricanes and a series of earthquakes and the resulting natural disasters that have stuck Puerto Rico since 2017. The full extent of the natural disasters’ impact on Puerto Rico’s economy and foreign investment in Puerto Rico is difficult to estimate.
Reinvestment Risk. Reinvestment risk is the risk that income from the Fund’s portfolio will decline if and when the Fund invests the proceeds from matured, traded or called municipal securities at market interest rates that are below the portfolio’s current earnings rate. A decline in income could affect the common shares’ market price, NAV and/or a common shareholder’s overall returns.
Sector and Industry Risk. Subject to the concentration limits of the Fund’s investment policies and guidelines, a Fund may invest a significant portion of its net assets in certain sectors of the municipal securities market, such as hospitals and other health care facilities, charter schools and other private
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Shareholder Update (Unaudited) (continued)
educational facilities, special taxing districts and start-up utility districts, and private activity bonds including industrial development bonds on behalf of transportation companies such as airline companies, whose credit quality and performance may be more susceptible to economic, business, political, regulatory and other developments than other sectors of municipal issuers. If the Fund invests a significant portion of its net assets in the sectors noted above, the Fund’s performance may be subject to additional risk and variability.
Sector Focus Risk. At times, the Fund may focus its investments (i.e., overweight its investments relative to the overall municipal securities market) in one or more particular sectors, which may subject the Fund to additional risk and variability. Securities issued in the same sector may be similarly affected by economic or market events, making the Fund more vulnerable to unfavorable developments in that sector than funds that invest more broadly. As the percentage of the Fund’s Managed Assets invested in a particular sector increases, so does the potential for fluctuation in the NAV of the Fund’s common shares.
Special Considerations Related to California Concentration Risk. Because the Fund primarily invests in municipal securities from a single state, the State of California, the Fund is more susceptible to political, economic or regulatory factors affecting issuers of California municipal securities. Information regarding the financial condition of the State of California is ordinarily included in various public documents issued thereby, such as the official statements prepared in connection with the issuance of general obligation bonds of the State of California.
Additionally, the State of California is a party to numerous legal proceedings, many of which normally occur in governmental operations. The creditworthiness of obligations issued by local California issuers may be unrelated to the creditworthiness of obligations issued by the State of California, and that there is no obligation on the part of the State of California to make payment on such local obligations in the event of default.
Special Risks Related to Certain Municipal Obligations. Municipal leases and certificates of participation involve special risks not normally associated with general obligations or revenue bonds. Leases and installment purchase or conditional sale contracts (which normally provide for title to the leased asset to pass eventually to the governmental issuer) have evolved as a means for governmental issuers to acquire property and equipment without meeting the constitutional and statutory requirements for the issuance of debt. The debt issuance limitations are deemed to be inapplicable because of the inclusion in many leases or contracts of “non-appropriation” clauses that relieve the governmental issuer of any obligation to make future payments under the lease or contract unless money is appropriated for such purpose by the appropriate legislative body. In addition, such leases or contracts may be subject to the temporary abatement of payments in the event that the governmental issuer is prevented from maintaining occupancy of the leased premises or utilizing the leased equipment. Although the obligations may be secured by the leased equipment or facilities, the disposition of the property in the event of non-appropriation or foreclosure might prove difficult, time consuming and costly, and may result in a delay in recovering or the failure to fully recover the Fund’s original investment. In the event of non-appropriation, the issuer would be in default and taking ownership of the assets may be a remedy available to the Fund, although the Fund does not anticipate that such a remedy would normally be pursued.
Certificates of participation involve the same risks as the underlying municipal leases. In addition, the Fund may be dependent upon the municipal authority issuing the certificates of participation to exercise remedies with respect to the underlying securities. Certificates of participation also entail a risk of default or bankruptcy, both of the issuer of the municipal lease and also the municipal agency issuing the certificate of participation.
Swap Transactions Risk. The Fund may enter into debt-related derivative instruments such as credit default swap contracts and interest rate swaps. Like most derivative instruments, the use of swaps is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio securities transactions. In addition, the use of swaps requires an understanding by the adviser and/or the sub-adviser of not only the referenced asset, rate or index, but also of the swap itself. If the investment adviser and/or the sub-adviser is incorrect in its forecasts of default risks, market spreads or other applicable factors or events, the investment performance of the Fund would diminish compared with what it would have been if these techniques were not used.
Tax Risk. The value of the Fund’s investments and its NAV may be adversely affected by changes in tax rates, rules and policies. Because interest income from municipal securities is normally not subject to regular federal income taxation, the attractiveness of municipal securities in relation to other investment alternatives is affected by changes in federal income tax rates or changes in the tax exempt status of interest income from municipal securities. Additionally, the Fund is not a suitable investment for individual retirement accounts, for other tax exempt or tax-deferred accounts, for investors who are not sensitive to the federal income tax consequences of their investments.
Taxability Risk. The Fund will invest in municipal securities in reliance at the time of purchase on an opinion of bond counsel to the issuer that the interest paid on those securities will be excludable from gross income for regular federal income tax purposes, and the sub-adviser will not independently verify that opinion. Subsequent to the Fund’s acquisition of such a municipal security, however, the security may be determined to pay, or to have paid, taxable income. As a result, the treatment of dividends previously paid or to be paid by the Fund as “exempt-interest dividends” could be adversely affected, subjecting the Fund’s shareholders to increased federal income tax liabilities. Certain other investments made by the Fund, including derivatives transactions, may result in the receipt of taxable income or gains by the Fund.
Tobacco Settlement Bond Risk. The Fund may invest in tobacco settlement bonds. Tobacco settlement bonds are municipal securities that are backed solely by expected revenues to be derived from lawsuits involving tobacco related deaths and illnesses which were settled between certain states and American tobacco companies. Tobacco settlement bonds are secured by an issuing state’s proportionate share in the Master Settlement Agreement, an agreement between 46 states and nearly all of the U.S. tobacco manufacturers (the “MSA”). Under the terms of the MSA, the actual amount of future
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settlement payments by tobacco-manufacturers is dependent on many factors, including, among other things, reduced cigarette consumption. Payments made by tobacco manufacturers could be negatively impacted if the decrease in tobacco consumption is significantly greater than the forecasted decline.
Unrated Securities Risk. The Fund may purchase securities that are not rated by any rating organization. Unrated securities determined by the Fund’s investment adviser to be of comparable quality to rated investments which the Fund may purchase may pay a higher dividend or interest rate than such rated investments and be subject to a greater risk of illiquidity or price changes. Less public information is typically available about unrated investments or issuers than rated investments or issuers. Some unrated securities may not have an active trading market or may be difficult to value, which means the Fund might have difficulty selling them promptly at an acceptable price. To the extent that the Fund invests in unrated securities, the Fund’s ability to achieve its investment objectives will be more dependent on the investment adviser’s credit analysis than would be the case when the Fund invests in rated securities.
Valuation Risk. The municipal securities in which the Fund invests typically are valued by a pricing service utilizing a range of market-based inputs and assumptions, including readily available market quotations obtained from broker-dealers making markets in such instruments, cash flows and transactions for comparable instruments. There is no assurance that the Fund will be able to sell a portfolio security at the price established by the pricing service, which could result in a loss to the Fund. Pricing services generally price municipal securities assuming orderly transactions of an institutional “round lot” size, but some trades may occur in smaller, “odd lot” sizes, often at lower prices than institutional round lot trades. Different pricing services may incorporate different assumptions and inputs into their valuation methodologies, potentially resulting in different values for the same securities. As a result, if the Fund were to change pricing services, or if the Fund’s pricing service were to change its valuation methodology, there could be a material impact, either positive or negative, on the Fund’s NAV.
Zero Coupon Bonds Risk. Because interest on zero coupon bonds is not paid on a current basis, the values of zero coupon bonds will be more volatile in response to interest rate changes than the values of bonds that distribute income regularly. Although zero coupon bonds generate income for accounting purposes, they do not produce cash flow, and thus the Fund could be forced to liquidate securities at an inopportune time in order to generate cash to distribute to shareholders as required by tax laws.
Fund Level and Other Risks:
Anti-Takeover Provisions. The Fund’s organizational documents include provisions that could limit the ability of other entities or persons to acquire control of the Fund or convert the Fund to open-end status. Further, the Fund’s by-laws provide that a shareholder who obtains beneficial ownership of common shares in a “Control Share Acquisition” will have the same voting rights as other common shares only to the extent authorized by shareholders. Although the application of the "Control Share Acquisition" provisions has currently been suspended, these provisions could have the effect of depriving the common shareholders of opportunities to sell their common shares at a premium over the then-current market price of the common shares.
Counterparty Risk. Changes in the credit quality of the companies that serve as the Fund’s counterparties with respect to derivatives or other transactions supported by another party’s credit will affect the value of those instruments. Certain entities that have served as counterparties in the markets for these transactions have incurred or may incur in the future significant financial hardships including bankruptcy and losses as a result of exposure to sub-prime mortgages and other lower-quality credit investments. As a result, such hardships have reduced these entities’ capital and called into question their continued ability to perform their obligations under such transactions. By using such derivatives or other transactions, the Fund assumes the risk that its counterparties could experience similar financial hardships. In the event of the insolvency of a counterparty, the Fund may sustain losses or be unable to liquidate a derivatives position.
Cybersecurity Risk. The Fund and its service providers are susceptible to operational and information security risk resulting from cyber incidents. Cyber incidents refer to both intentional attacks and unintentional events including: processing errors, human errors, technical errors including computer glitches and system malfunctions, inadequate or failed internal or external processes, market-wide technical-related disruptions, unauthorized access to digital systems (through “hacking” or malicious software coding), computer viruses, and cyber-attacks which shut down, disable, slow or otherwise disrupt operations, business processes or website access or functionality (including denial of service attacks). Cyber incidents could adversely impact the Fund and cause the Fund to incur financial loss and expense, as well as face exposure to regulatory penalties, reputational damage, and additional compliance costs associated with corrective measures. In addition, substantial costs may be incurred in order to prevent any cyber incidents in the future. Furthermore, the Fund cannot control the cybersecurity plans and systems put in place by its service providers or any other third parties whose operations may affect the Fund.
Economic and Political Events Risk. The Fund may be more sensitive to adverse economic, business or political developments if it invests a substantial portion of its assets in the municipal securities of similar projects (such as those relating to the education, health care, housing, transportation, or utilities industries), industrial development bonds, or in particular types of municipal securities (such as general obligation bonds, private activity bonds or moral obligation bonds). Such developments may adversely affect a specific industry or local political and economic conditions, and thus may lead to declines in the creditworthiness and value of such municipal securities.
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Shareholder Update (Unaudited) (continued)
Global Economic Risk. National and regional economies and financial markets are becoming increasingly interconnected, which increases the possibilities that conditions in one country, region or market might adversely impact issuers in a different country, region or market. Changes in legal, political, regulatory, tax and economic conditions may cause fluctuations in markets and securities prices around the world, which could negatively impact the value of the Fund’s investments. Major economic or political disruptions, particularly in large economies like China’s, may have global negative economic and market repercussions. Additionally, instability in various countries, such as Afghanistan and Syria, and natural and environmental disasters and the spread of infectious illnesses or other public health emergencies, possible terrorist attacks in the United States and around the world, continued tensions between North Korea and the United States and the international community generally, growing social and political discord in the United States, the European debt crisis, the response of the international community—through economic sanctions and otherwise—further downgrade of U.S. government securities, the change in the U.S. president and the new administration and other similar events may adversely affect the global economy and the markets and issuers in which the Fund invests. Recent examples of such events include the outbreak of a novel coronavirus known as COVID-19 that was first detected in China in December 2019 and heightened concerns regarding North Korea’s nuclear weapons and long-range ballistic missile programs. In addition, Russia’s recent invasion of Ukraine in February 2022 has resulted in sanctions imposed by several nations, such as the United States, United Kingdom, European Union and Canada. The current sanctions and potential further sanctions may negatively impact certain sectors of Russia’s economy, but also may negatively impact the value of the Fund’s investments that do not have direct exposure to Russia. These events could reduce consumer demand or economic output, result in market closure, travel restrictions or quarantines, and generally have a significant impact on the economy. These events could also impair the information technology and other operational systems upon which the Fund’s service providers, including the investment adviser and sub-adviser, rely, and could otherwise disrupt the ability of employees of the Fund’s service providers to perform essential tasks on behalf of the Fund. Governmental and quasigovernmental authorities and regulators throughout the world have in the past responded to major economic disruptions with a variety of significant fiscal and monetary policy changes, including but not limited to, direct capital infusions into companies, new monetary programs and dramatically lower interest rates. An unexpected or quick reversal of these policies, or the ineffectiveness of these policies, could increase volatility in securities markets, which could adversely affect the Fund’s investments.
Investment and Market Risk. An investment in common shares is subject to investment risk, including the possible loss of the entire principal amount that you invest. Common shares frequently trade at a discount to their NAV. An investment in common shares represents an indirect investment in the securities owned by the Fund. Common shares at any point in time may be worth less than your original investment, even after taking into account the reinvestment of Fund dividends and distributions.
Legislation and Regulatory Risk. At any time after the date of this report, legislation or additional regulations may be enacted that could negatively affect the assets of the Fund, securities held by the Fund or the issuers of such securities. Fund shareholders may incur increased costs resulting from such legislation or additional regulation. There can be no assurance that future legislation, regulation or deregulation will not have a material adverse effect on the Fund or will not impair the ability of the Fund to achieve its investment objectives.
The SEC’s recently adopted Rule 18f-4 under the 1940 Act governing the use of derivatives by registered investment companies, which could affect the nature and extent of derivatives used by the Fund. Rule 18f-4 could limit the Fund’s use of derivatives, which could have an adverse impact on the Fund.
Leverage Risk. The use of leverage creates special risks for common shareholders, including potential interest rate risks and the likelihood of greater volatility of NAV and market price of, and distributions on, the common shares. The use of leverage in a declining market will likely cause a greater decline in the Fund’s NAV, which may result at a greater decline of the common share price, than if the Fund were not to have used leverage.
The Fund will pay (and common shareholders will bear) any costs and expenses relating to the Fund’s use of leverage, which will result in a reduction in the Fund’s NAV. The investment adviser may, based on its assessment of market conditions and composition of the Fund’s holdings, increase or decrease the amount of leverage. Such changes may impact the Fund’s distributions and the price of the common shares in the secondary market.
The Fund may seek to refinance its leverage over time, in the ordinary course, as current forms of leverage mature or it is otherwise desirable to refinance; however, the form that such leverage will take cannot be predicted at this time. If the Fund is unable to replace existing leverage on comparable terms, its costs of leverage will increase. Accordingly, there is no assurance that the use of leverage may result in a higher yield or return to common shareholders.
The amount of fees paid to the investment adviser and the sub-adviser for investment advisory services will be higher if the Fund uses leverage because the fees will be calculated based on the Fund’s Managed Assets - this may create an incentive for the investment adviser and the sub-adviser to leverage the Fund or increase the Fund’s leverage.
Limited Term Risk. Because the assets of the Fund will be liquidated in connection with its termination, the Fund may be required to sell portfolio securities when it otherwise would not, including at times when market conditions are not favorable, which may cause the Fund to lose money. The Fund’s investment objectives and policies are not designed to return to investors who purchase Common Shares in this offering their initial investment on the termination date. When terminated, the Fund’s distributions will be based upon the Fund’s net asset value at the end of the term and such initial investors and any investors that purchase Common Shares after the completion of this offering may receive more or less than their original investment upon termination.
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Market Discount from Net Asset Value. Shares of closed-end investment companies like the Fund frequently trade at prices lower than their NAV. This characteristic is a risk separate and distinct from the risk that the Fund’s NAV could decrease as a result of investment activities. Whether investors will realize gains or losses upon the sale of the common shares will depend not upon the Fund’s NAV but entirely upon whether the market price of the common shares at the time of sale is above or below the investor’s purchase price for the common shares. Furthermore, management may have difficulty meeting the Fund’s investment objectives and managing its portfolio when the underlying securities are redeemed or sold during periods of market turmoil and as investors’ perceptions regarding closed-end funds or their underlying investments change. Because the market price of the common shares will be determined by factors such as relative supply of and demand for the common shares in the market, general market and economic circumstances, and other factors beyond the control of the Fund, the Fund cannot predict whether the common shares will trade at, below or above NAV. The common shares are designed primarily for long-term investors, and you should not view the Fund as a vehicle for short-term trading purposes.
Recent Market Conditions. Periods of unusually high financial market volatility and restrictive credit conditions, at times limited to a particular sector or geographic area, have occurred in the past and may be expected to recur in the future. Some countries, including the United States, have adopted or have signaled protectionist trade measures, relaxation of the financial industry regulations that followed the financial crisis, and/or reductions to corporate taxes. The scope of these policy changes is still developing, but the equity and debt markets may react strongly to expectations of change, which could increase volatility, particularly if a resulting policy runs counter to the market’s expectations. The outcome of such changes cannot be foreseen at the present time. In addition, geopolitical and other risks, including environmental and public health risks, may add to instability in the world economy and markets generally. As a result of increasingly interconnected global economies and financial markets, the value and liquidity of the Fund’s investments may be negatively affected by events impacting a country or region, regardless of whether the Fund invests in issuers located in or with significant exposure to such country or region.
The current outbreak of COVID-19 has resulted in instances of market closures and dislocations, extreme volatility, liquidity constraints and increased trading costs. Efforts to contain the spread of COVID-19 have resulted in travel restrictions, closed international borders, disruptions of healthcare systems, business operations (including business closures) and supply chains, layoffs, lower consumer demand and employee availability, defaults and credit downgrades, among other significant economic impacts, all of which have disrupted global economic activity across many industries and may exacerbate other pre-existing political, social and economic risks, locally or globally and cause general concern and uncertainty. The full economic impact and ongoing effects of COVID-19 (or other future epidemics or pandemics) at the macro-level and on individual businesses are unpredictable and may result in significant and prolonged effects on the Fund's performance.
To the extent the impacts of COVID-19 continue, the Fund may experience negative impacts to its business that could exacerbate other risks to which the Fund is subject, including: (1) operational impacts on and availability of key personnel of Nuveen Fund Advisors, the Sub-Advisers, and/or any of the Fund’s other service providers, vendors and counterparties as they face changed circumstances and/or illness related to the pandemic and (2) limitations on the Fund’s ability to make distributions or dividends, as applicable, to Common Shareholders.
Governmental authorities and regulators throughout the world, such as the U.S. Federal Reserve, have in the past responded to major economic disruptions with changes to fiscal and monetary policy, including but not limited to, direct capital infusions, new monetary programs, and dramatically lower interest rates. Certain of those policy changes are being implemented or considered in response to the COVID-19 outbreak. Such policy changes may adversely affect the value, volatility and liquidity of instruments in which the Fund invests.
On June 23, 2016, the United Kingdom (“UK”) held a referendum on whether to remain a member state of the European Union (“EU”), in which voters favored the UK’s withdrawal from the EU, an event widely referred to as “Brexit.” On January 31, 2020, the UK formally withdrew from the EU. The transition period concluded on December 31, 2020, and EU law no longer applies in the UK. On December 30, 2020, the UK and EU signed an EU-UK Trade and Cooperation Agreement (“UK/EU Trade Agreement”), which went into effect on January 1, 2021 and sets out the foundation of the economic and legal framework for trade between the UK and EU. As the UK/EU Trade Agreement is a new legal framework, the implementation of the UK/EU Trade Agreement may result in uncertainty in its application and periods of volatility in both the UK and wider European markets. The longer term economic, legal, political and social framework to be put in place between the UK and the EU are unclear at this stage, remain subject to negotiation and are likely to lead to ongoing political and economic uncertainty and periods of exacerbated volatility in both the UK and in wider European markets for some time. The outcomes may cause increased volatility and have a significant adverse impact on world financial markets, other international trade agreements, and the UK and European economies, as well as the broader global economy for some time. Additionally, a number of countries in Europe have suffered terror attacks, and additional attacks may occur in the future. Ukraine has experienced ongoing military conflict, most recently in February 2022 when Russia invaded Ukraine; this conflict may expand and military attacks could occur elsewhere in Europe. Europe has also been struggling with mass migration from the Middle East and Africa. The ultimate effects of these events and other socio-political or geographical issues are not known but could profoundly affect global economies and markets.
The ongoing trade war between China and the United States, including the imposition of tariffs by each country has recently imposed tariffs on the other country’s products, has created a tense political environment. These actions may trigger a significant reduction in international trade, the oversupply of certain manufactured goods, substantial price reductions of goods and possible failure of individual companies and/or large segments of China’s export industry, which could have a negative impact on the Fund’s performance. U.S. companies that source material and goods from China
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Shareholder Update (Unaudited) (continued)
and those that make large amounts of sales in China would be particularly vulnerable to an escalation of trade tensions. Uncertainty regarding the outcome of the trade tensions and the potential for a trade war could cause the U.S. dollar to decline against safe haven currencies, such as the Japanese yen and the euro. Events such as these and their consequences are difficult to predict and it is unclear whether further tariffs may be imposed or other escalating actions may be taken in the future.
The impact of these developments in the near- and long-term is unknown and could have additional adverse effects on economies, financial markets and asset valuations around the world.
Reverse Repurchase Agreement Risk. A reverse repurchase agreement, in economic essence, constitutes a securitized borrowing by the Fund from the security purchaser. In a reverse repurchase agreement, the Fund retains the risk of loss associated with the sold security. The Fund may enter into reverse repurchase agreements for the purpose of creating a leveraged investment exposure and, as such, their usage involves essentially the same risks associated with a leveraging strategy generally since the proceeds from these agreements may be invested in additional portfolio securities. Reverse repurchase agreements tend to be short-term in tenor, and there can be no assurances that the purchaser (lender) will commit to extend or “roll” a given agreement upon its agreed-upon repurchase date or an alternative purchaser can be identified on similar terms. Reverse repurchase agreements also involve the risk that the purchaser fails to return the securities as agreed upon, files for bankruptcy or becomes insolvent. Upon the bankruptcy or insolvency of a counterparty, the Fund is considered to be an unsecured creditor with respect to excess collateral and as such the return of the excess collateral may be delayed. The Fund also may be restricted from taking normal portfolio actions during such time, could be subject to loss to the extent that the proceeds of the agreement are less than the value of securities subject to the agreement and may experience adverse tax consequences.
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EFFECTS OF LEVERAGE
The following table is furnished in response to requirements of the SEC. It is designed to illustrate the effects of leverage through the use of senior securities, as that term is defined under Section 18 of the 1940 Act, as well as certain other forms of leverage, such as reverse repurchase agreements and investments in inverse floating rate securities, on common share total return, assuming investment portfolio total returns (consisting of income and changes in the value of investments held in the Fund’s portfolio) of -10%, -5%, 0%, 5% and 10%. The table below reflects each Fund’s (i) continued use of leverage as of May 31, 2022 as a percentage of Managed Assets (including assets attributable to such leverage), (ii) the estimated annual effective interest expense rate payable by the Funds on such instruments (based on actual leverage costs incurred during the fiscal year ended May 31, 2022) as set forth in the table, and (iii) the annual return that the Fund’s portfolio must experience (net of expenses) in order to cover such costs of leverage based on such estimated annual effective interest expense rate. The information below does not reflect any Fund’s use of certain other forms of economic leverage achieved through the use of certain derivative instruments.
The numbers are merely estimates, used for illustration. The costs of leverage may vary frequently and may be significantly higher or lower than the estimated rate. The assumed investment portfolio returns in the table below are hypothetical figures and are not necessarily indicative of the investment portfolio returns experienced or expected to be experienced by the Funds. Your actual returns may be greater or less than those appearing below.
| Nuveen | ||
| Nuveen | Intermediate | |
| Intermediate | Duration | |
| Duration | Quality | |
| Municipal | Municipal | |
| Term | Term | |
| Fund | Fund | |
| (NID) | (NIQ) | |
| Estimated Leverage as a Percentage of Managed Assets (Including Assets | ||
| Attributable to Leverage) | 35.63% | 33.69% |
| Estimated Annual Effective Leverage Expense Rate Payable by Fund on Leverage | 1.04% | 1.12% |
| Annual Return Fund Portfolio Must Experience (net of expenses) to Cover | ||
| Estimated Annual Effective Interest Expense Rate on Leverage | 0.37% | 0.38% |
| Common Share Total Return for (10.00)% Assumed Portfolio Total Return | -16.11% | -15.65% |
| Common Share Total Return for (5.00)% Assumed Portfolio Total Return | -8.34% | -8.11% |
| Common Share Total Return for 0.00% Assumed Portfolio Total Return | -0.58% | -0.57% |
| Common Share Total Return for 5.00% Assumed Portfolio Total Return | 7.19% | 6.97% |
| Common Share Total Return for 10.00% Assumed Portfolio Total Return | 14.96% | 14.51% |
Common Share total return is composed of two elements — the distributions paid by the Fund to holders of common shares (the amount of which is largely determined by the net investment income of the Fund after paying dividend payments on any preferred shares issued by the Fund and expenses on any forms of leverage outstanding) and gains or losses on the value of the securities and other instruments the Fund owns. As required by SEC rules, the table assumes that the Funds are more likely to suffer capital losses than to enjoy capital appreciation. For example, to assume a total return of 0%, the Fund must assume that the income it receives on its investments is entirely offset by losses in the value of those investments. This table reflects hypothetical performance of the Fund’s portfolio and not the actual performance of the Fund’s common shares, the value of which is determined by market forces and other factors. Should the Fund elect to add additional leverage to its portfolio, any benefits of such additional leverage cannot be fully achieved until the proceeds resulting from the use of such leverage have been received by the Fund and invested in accordance with the Fund’s investment objectives and policies. As noted above, the Fund’s willingness to use additional leverage, and the extent to which leverage is used at any time, will depend on many factors.
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Shareholder Update (Unaudited) (continued)
DIVIDEND
REINVESTMENT PLAN
Nuveen Closed-End Funds Automatic Reinvestment Plan
Your Nuveen Closed-End Fund allows you to conveniently reinvest distributions in additional Fund shares. By choosing to reinvest, you’ll be able to invest money regularly and automatically, and watch your investment grow through the power of compounding. Just like distributions in cash, there may be times when income or capital gains taxes may be payable on distributions that are reinvested. It is important to note that an automatic reinvestment plan does not ensure a profit, nor does it protect you against loss in a declining market.
Easy and convenient
To make recordkeeping easy and convenient, each month you’ll receive a statement showing your total distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own.
How shares are purchased
The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above NAV at the time of valuation, the Fund will issue new shares at the greater of the NAV or 95% of the then-current market price. If the shares are trading at less than NAV, shares for your account will be purchased on the open market. If Computershare Trust Company, N.A. (the “Plan Agent”) begins purchasing Fund shares on the open market while shares are trading below NAV, but the Fund’s shares subsequently trade at or above their NAV before the Plan Agent is able to complete its purchases, the Plan Agent may cease open-market purchases and may invest the uninvested portion of the distribution in newly-issued Fund shares at a price equal to the greater of the shares’ NAV or 95% of the shares’ market value on the last business day immediately prior to the purchase date. Distributions received to purchase shares in the open market will normally be invested shortly after the distribution payment date. No interest will be paid on distributions awaiting reinvestment. Because the market price of the shares may increase before purchases are completed, the average purchase price per share may exceed the market price at the time of valuation, resulting in the acquisition of fewer shares than if the distribution had been paid in shares issued by the Fund. A pro rata portion of any applicable brokerage commissions on open market purchases will be paid by Dividend Reinvestment Plan (the “Plan”) participants. These commissions usually will be lower than those charged on individual transactions.
Flexible
You may change your distribution option or withdraw from the Plan at any time, should your needs or situation change. You can reinvest whether your shares are registered in your name, or in the name of a brokerage firm, bank, or other nominee. Ask your investment advisor if his or her firm will participate on your behalf. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time.
Call today to start reinvesting distributions
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial professional or call us at (800) 257-8787.
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CHANGES OCCURRING DURING THE FISCAL YEAR
The following information in this annual report is a summary of certain changes during the most recent fiscal year. This information may not reflect all of the changes that have occurred since you purchased shares of a Fund.
During the most recent fiscal year, there have been no changes to: (i) the Funds’ investment objectives and principal investment policies that have not been approved by shareholders, (ii) the principal risks of the Fund, (iii) the portfolio managers of the Funds; (iv) a Fund’s charter or by-laws that would delay or prevent a change of control of the Fund that have not been approved by shareholders except as follows:
Developments Regarding the Funds’ Control Share By-Law
On October 5, 2020, the Nuveen Intermediate Duration Municipal Term Fund and the Nuveen Intermediate Duration Quality Municipal Term Fund (each a “Fund” and collectively the “Funds”) and certain other closed-end funds in the Nuveen fund complex amended their by-laws. Among other things, the amended by-laws included provisions pursuant to which, in summary, a shareholder who obtains beneficial ownership of common shares in a Control Share Acquisition (as defined in the by-laws) shall have the same voting rights as other common shareholders only to the extent authorized by the other disinterested shareholders (the “Control Share By-Law”). On January 14, 2021, a shareholder of certain Nuveen closed-end funds filed a civil complaint in the U.S. District Court for the Southern District of New York (the “District Court”) against certain Nuveen funds and their trustees, seeking a declaration that such funds’ Control Share By-Laws violate the 1940 Act, rescission of such fund’s Control Share By-Laws and a permanent injunction against such funds applying the Control Share By-Laws. On February 18, 2022, the District Court granted judgment in favor of the plaintiff’s claim for rescission of such funds’ Control Share By-Laws and the plaintiff’s declaratory judgment claim, and declared that such funds’ Control Share By-Laws violate Section 18(i) of the 1940 Act. Following review of the judgment of the District Court, on February 22, 2022, the Board amended the Funds’ bylaws to provide that the Funds’ Control Share By-Law shall be of no force and effect for so long as the judgment of the District Court is effective and that if the judgment of the District Court is reversed, overturned, vacated, stayed, or otherwise nullified, the Funds’ Control Share By-Law will be automatically reinstated and apply to any beneficial owner of common shares acquired in a Control Share Acquisition, regardless of whether such Control Share Acquisition occurs before or after such reinstatement, for the duration of the stay or upon issuance of the mandate reversing, overturning, vacating or otherwise nullifying the judgment of the District Court. On February 25, 2022, the Board and the Funds appealed the District Court’s decision to the U.S. Court of Appeals for the Second Circuit.
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Important Tax Information (Unaudited)
As required by the Internal Revenue Code and Treasury Regulations, certain tax information, as detailed below, must be provided to shareholders. Shareholders are advised to consult their tax advisor with respect to the tax implications of their investment. The amounts listed below may differ from the actual amounts reported on Form 1099-DIV, which will be sent to shareholders shortly after calendar year end.
Long-Term Capital Gains
As of year end, each Fund designates the following distribution amounts, or maximum amount allowable, as being from net long-term capital gains pursuant to Section 852(b)(3) of the Internal Revenue Code:
| Net Long-Term | |
| Fund | Capital Gains |
| NID | $ — |
| NIQ | — |
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Additional Fund Information (Unaudited)
| Board of Trustees | |||||
| Jack B. Evans | William C. Hunter | Amy B. R. Lancellotta | Joanne T. Medero | Albin F. Moschner | John K. Nelson |
| Judith M. Stockdale | Carole E. Stone | Mathew Thornton III | Terence J. Toth | Margaret L. Wolff | Robert L. Young |
| Investment Adviser | Custodian | Legal Counsel | Independent Registered | Transfer Agent and |
| Nuveen Fund Advisors, LLC | State Street Bank | Chapman and Cutler LLP | Public Accounting Firm | Shareholder Services |
| 333 West Wacker Drive | & Trust Company | Chicago, IL 60603 | KPMG LLP | Computershare Trust |
| Chicago, IL 60606 | One Lincoln Street | 200 East Randolph Street | Company, N.A. | |
| Boston, MA 02111 | Chicago, IL 60601 | 150 Royall Street | ||
| Canton, MA 02021 | ||||
| (800) 257-8787 |
Portfolio of Investments Information
Each Fund is required to file its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its report on Form N-PORT. You may obtain this information on the SEC’s website at http://www.sec.gov.
Nuveen Funds’ Proxy Voting Information
You may obtain (i) information regarding how each fund voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30, without charge, upon request, by calling Nuveen toll-free at (800) 257-8787 or on Nuveen’s website at www.nuveen.com and (ii) a description of the policies and procedures that each fund used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen toll free at (800) 257-8787. You may also obtain this information directly from the SEC. Visit the SEC on-line at http://www.sec.gov.
CEO Certification Disclosure
Each Fund’s Chief Executive Officer (CEO) has submitted to the New York Stock Exchange (NYSE) the annual CEO certification as required by Section 303A.12(a) of the NYSE Listed Company Manual. Each Fund has filed with the SEC the certification of its CEO and Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act.
Common Share Repurchases
Each Fund intends to repurchase, through its open-market share repurchase program, shares of its own common stock at such times and in such amounts as is deemed advisable. During the period covered by this report, each Fund repurchased shares of its common stock, as shown in the accompanying table. Any future repurchases will be reported to shareholders in the next annual or semi-annual report.
| NID | NIQ |
| Common Shares Repurchased | 0 | 0 |
FINRA BrokerCheck
The Financial Industry Regulatory Authority (FINRA) provides information regarding the disciplinary history of FINRA member firms and associated investment professionals. This information as well as an investor brochure describing FINRA BrokerCheck is available to the public by calling the FINRA BrokerCheck Hotline number at (800) 289-9999 or by visiting www.FINRA.org.
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Glossary of Terms Used in this Report (Unaudited)
| • | Average Annual Total Return: This is a commonly used method to express an investment’s performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment’s actual cumulative performance (including change in NAV or market price and reinvested dividends and capital gains distributions, if any) over the time period being considered. |
| • | Effective Leverage: Effective leverage is a fund’s effective economic leverage, and includes both regulatory leverage (see leverage) and the leverage effects of certain derivative investments in a fund’s portfolio. Currently, the leverage effects of Tender Option Bond (TOB) inverse floater holdings are included in effective leverage values, in addition to any regulatory leverage. |
| • | Gross Domestic Product (GDP): The total market value of all final goods and services produced in a country/region in a given year, equal to total consumer, investment and government spending, plus the value of exports, minus the value of imports. |
| • | Industrial Development Revenue Bond (IDR): A unique type of revenue bond issued by a state or local government agency on behalf of a private sector company and intended to build or acquire factories or other heavy equipment and tools. |
| • | Inverse Floating Rate Securities: Inverse floating rate securities, also known as inverse floaters or tender option bonds (TOBs), are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond’s par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an “inverse floater”) to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond’s downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond’s value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis. |
| • | Leverage: Leverage is created whenever a fund has investment exposure (both reward and/or risk) equivalent to more than 100% of the investment capital. |
| • | Net Asset Value (NAV) Per Share: A fund’s Net Assets is equal to its total assets (securities, cash, accrued earnings and receivables) less its total liabilities. NAV per share is equal to the fund’s Net Assets divided by its number of shares outstanding. |
| • | Pre-Refunded Bond/Pre-Refunding: Pre-Refunded Bond/Pre-Refunding, also known as advanced refundings or refinancings, is a procedure used by state and local governments to refinance municipal bonds to lower interest expenses. The issuer sells new bonds with a lower yield and uses the proceeds to buy U.S. Treasury securities, the interest from which is used to make payments on the higher yielding bonds. Because of this collateral, pre-refunding generally raises a bond’s credit rating and thus its value. |
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| • | Regulatory Leverage: Regulatory Leverage consists of preferred shares issued by or borrowings of a fund. Both of these are part of a fund’s capital structure. Regulatory leverage is subject to asset coverage limits set in the Investment Company Act of 1940. |
| • | S&P Intermediate Duration Municipal Yield Index: An index designed to measure the performance of both the investment grade municipal bond market and the high yield municipal bond market in the duration ranges of short duration: 1 to 12 years maturity range and long duration: 1 to 17 years maturity range. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees. |
| • | S&P Municipal Bond Intermediate Index: An index containing bonds in the S&P Municipal Bond Index that mature between 3 and 15 years. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees. |
| • | Tax Obligation/General Bonds: Bonds backed by the general revenues of an issuer, including taxes, where the issuer has the ability to increase taxes by an unlimited amount to pay the bonds back. |
| • | Tax Obligation/Limited Bonds: Bonds backed by the general revenues of an issuer, including taxes, where the issuer doesn't have the ability to increase taxes by an unlimited amount to pay the bonds back. |
| • | Total Investment Exposure: Total investment exposure is a fund’s assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes a fund’s use of preferred stock and borrowings and investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities. |
| • | Zero Coupon Bond: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically. |
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Annual Investment Management Agreement Approval Process (Unaudited)
At a meeting held on May 23-25, 2022 (the “May Meeting”), the Boards of Trustees (collectively, the “Board” and each Trustee, a “Board Member”) of the Funds, which are comprised entirely of Board Members who are not “interested persons” (as defined under the Investment Company Act of 1940 (the “1940 Act”)) (the “Independent Board Members”), approved, for their respective Fund, the renewal of the management agreement (each, an “Investment Management Agreement”) with Nuveen Fund Advisors, LLC (the “Adviser”) pursuant to which the Adviser serves as investment adviser to such Fund and the sub-advisory agreement (each, a “Sub-Advisory Agreement”) with Nuveen Asset Management, LLC (the “Sub-Adviser”) pursuant to which the Sub-Adviser serves as the sub-adviser to such Fund for an additional one-year term. As the Board is comprised of all Independent Board Members, the references to the Board and the Independent Board Members are interchangeable.
Following up to an initial two-year period, the Board considers the renewal of each Investment Management Agreement and Sub-Advisory Agreement on behalf of the applicable Fund on an annual basis. The Investment Management Agreements and Sub-Advisory Agreements are collectively referred to as the “Advisory Agreements,” and the Adviser and the Sub-Adviser are collectively, the “Fund Advisers” and each, a “Fund Adviser.” The Board has established various standing committees composed of various Independent Board Members that are assigned specific responsibilities to enhance the effectiveness of the Board’s oversight and decision making. Throughout the year, the Board and its committees meet regularly and, at these meetings, receive regular and/or special reports that cover an extensive array of topics and information that are relevant to the Board’s annual consideration of the renewal of the advisory agreements for the Nuveen funds. Such information may address, among other things, fund performance and risk information; the Adviser’s strategic plans; product initiatives for various funds; the review of the funds and investment teams; compliance, regulatory and risk management matters; the trading practices of the various sub-advisers to the Nuveen funds; management of distributions; valuation of securities; fund expenses; securities lending; liquidity management; overall market and regulatory developments; and with respect to closed-end funds, capital management initiatives, institutional ownership, management of leverage financing and the secondary market trading of the closed-end funds and any actions to address discounts. The Board also seeks to meet periodically with the Nuveen funds’ sub-advisers and/or portfolio teams, when feasible. The Board further meets, among other things, to specifically consider the annual renewal of the advisory agreements for the Nuveen funds.
In connection with its annual consideration of the advisory agreements for the Nuveen funds, the Board, through its independent legal counsel, requested and received extensive materials and information prepared specifically for its review of such advisory agreements by the Adviser and by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent provider of investment company data. The materials cover a wide range of topics including, but not limited to, a description of the nature, extent and quality of services provided by the Fund Advisers; a review of product actions taken during 2021 (such as mergers, liquidations, fund launches, changes to investment teams, and changes to investment policies); a review of each sub-adviser to the Nuveen funds and/or the applicable investment teams; an analysis of fund performance in absolute terms and as compared to the performance of certain peer funds and benchmarks with a focus on any performance outliers; an analysis of the fees and expense ratios of the Nuveen funds in absolute terms and as compared to those of certain peer funds with a focus on any expense outliers; a review of management fee schedules; a description of portfolio manager compensation; an overview of the secondary market trading of shares of the Nuveen closed-end funds (including, among other things, an analysis of secondary market performance and commentary regarding the leverage management, share repurchase and shelf offering programs of Nuveen closed-end funds); a review of the performance of various service providers; a description of various initiatives Nuveen had undertaken or continued in 2021 and 2022 for the benefit of particular fund(s) and/or the complex; a description of the profitability or financial data of Nuveen and the sub-advisers to the Nuveen funds; and a description of indirect benefits received by the Adviser and the sub-advisers as a result of their relationships with the Nuveen funds. The information prepared specifically for the annual review supplemented the
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information provided to the Board and its committees and the evaluations of the Nuveen funds by the Board and its committees during the year. The Board’s review of the advisory agreements for the Nuveen funds is based on all the information provided to the Board and its committees throughout the year as well as the information prepared specifically with respect to the annual review of such advisory agreements.
In continuing its practice, the Board met prior to the May Meeting to begin its considerations of the renewal of the Advisory Agreements. Accordingly, on April 13-14, 2022 (the “April Meeting”), the Board met to review and discuss, in part, the performance of the Nuveen funds and the Adviser’s evaluation of each sub-adviser to the Nuveen funds and/or its investment teams. At the April Meeting, the Board Members asked questions and requested additional information that was provided for the May Meeting.
The Independent Board Members considered the review of the advisory agreements for the Nuveen funds to be an ongoing process and employed the accumulated information, knowledge and experience the Board Members had gained during their tenure on the boards governing the Nuveen funds and working with the Adviser and sub-advisers in their review of the advisory agreements. The contractual arrangements are a result of multiple years of review, negotiation and information provided in connection with the boards’ annual review of the Nuveen funds’ advisory arrangements and oversight of the Nuveen funds.
The Independent Board Members were advised by independent legal counsel during the annual review process as well as throughout the year, including meeting in executive sessions with such counsel at which no representatives from the Adviser or the Sub-Adviser were present. In connection with their annual review, the Independent Board Members also received a memorandum from independent legal counsel outlining their fiduciary duties and legal standards in reviewing the Advisory Agreements, including guidance from court cases evaluating advisory fees.
The Board’s decision to renew the Advisory Agreements was not based on a single identified factor, but rather the decision reflected the comprehensive consideration of all the information provided to the Board and its committees throughout the year as well as the materials prepared specifically in connection with the renewal process. Each Board Member may have attributed different levels of importance to the various factors and information considered in connection with the approval process and may place different emphasis on the relevant information year to year in light of, among other things, changing market and economic conditions. A summary of the principal factors and information, but not all the factors, the Board considered in deciding to renew the Advisory Agreements is set forth below.
A. Nature, Extent and Quality of Services
In evaluating the renewal of the Advisory Agreements, the Independent Board Members received and considered information regarding the nature, extent and quality of the applicable Fund Adviser’s services provided to the respective Fund with particular focus on the services and enhancements to such services provided during the last year. The Independent Board Members considered the Investment Management Agreements and the Sub-Advisory Agreements separately in the course of their review. With this approach, they considered the respective roles of the Adviser and the Sub-Adviser in providing services to the Funds.
The Board recognized that the Nuveen funds operate in a highly regulated industry and, therefore, the Adviser has provided a wide array of management, oversight and administrative services to manage and operate the funds, and the scope and complexity of these services have expanded over time as a result of, among other things, regulatory, market and other developments. The Board accordingly considered the Adviser’s dedication of extensive resources, time, people and capital employed to support and manage the Nuveen funds as well as the Adviser’s continued program of developing improvements and innovations for the benefit of the funds and shareholders and to meet the ever increasing regulatory requirements applicable to the funds. In this regard, the Board received and reviewed information regarding, among other things, the Adviser’s investment oversight responsibilities, regulatory and compliance services, administrative duties and other services. The Board considered the Adviser’s investment oversight team’s extensive services in overseeing the various sub-advisers to the Nuveen funds; evaluating fund performance; and preparing reports to the Board addressing, among other things, fund
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Annual Investment Management Agreement Approval Process (Unaudited) (continued)
performance, market conditions, investment team matters, product developments and management proposals. The Board further recognized the range of services the various teams of the Adviser provided including, but not limited to, overseeing operational and risk management; managing liquidity; overseeing the daily valuation process and managing distributions in seeking to deliver long-term fund earnings to shareholders consistent with the respective Nuveen fund’s product design and positioning. The Board also considered the structure of investment personnel compensation of each Fund Adviser and whether the structure provides appropriate incentives to attract and maintain qualified personnel and to act in the best interests of the respective Nuveen fund.
The Board further recognized that the Adviser’s compliance and regulatory functions were integral to the investment management of the Nuveen funds. The Board recognized such services included, but were not limited to, managing compliance policies; monitoring compliance with applicable policies, law and regulations; devising internal compliance programs and a framework to review and assess compliance programs; overseeing sub-adviser compliance testing; preparing compliance training materials; and responding to regulatory requests. The Board further considered information regarding the Adviser’s business continuity and disaster recovery plans as well as information regarding its information security program, including presentations of such program provided at a site visit in 2022, to help identify and manage information security risks.
In addition to the above functions, the Board considered that the Adviser also provides, among other things, fund administration services (such as preparing fund tax returns and other tax compliance services; preparing regulatory filings; interacting with the Nuveen funds’ independent public accountants and overseeing other service providers; and managing fund budgets and expenses); product management services (such as evaluating and enhancing products and strategies); legal services (such as helping to prepare and file registration statements and proxy statements; overseeing fund activities and providing legal interpretations regarding such activities; maintaining regulatory registrations and negotiating agreements with other fund service providers; and monitoring changes in regulatory requirements and commenting on rule proposals impacting investment companies); oversight of shareholder services and transfer agency functions (such as overseeing transfer agent service providers which include registered shareholder customer service and transaction processing; overseeing proxy solicitation and tabulation services; and overseeing the production and distribution of financial reports by service providers); and with respect to the Nuveen closed-end funds, managing leverage, monitoring asset coverage and seeking to promote an orderly secondary market.
The Board also considered the quality of support services and communications the Adviser provided the Board, including, in part, organizing and administrating Board meetings and supporting Board committees; preparing regular and ad hoc reports on fund performance, market conditions and investment team matters; providing due diligence reports addressing product development and management proposals; and coordinating site visits of the Board and presentations by investment teams and senior management.
In addition to the services provided, the Board considered the financial resources of the Adviser and its affiliates and their willingness to make investments in the technology, personnel and infrastructure to support the Nuveen funds, including maintaining a seed capital budget to support new or existing funds and/or facilitate changes for a respective fund. Further, the Board noted the benefits to shareholders of investing in a fund that is a part of a large fund complex with a variety of investment disciplines, capabilities, expertise and resources available to navigate and support the Nuveen funds including during stressed times. The Board recognized the overall reputation and capabilities of the Adviser and its affiliates, the Adviser’s continuing commitment to provide high quality services, its willingness to implement operational or organizational changes in seeking, among other things, to enhance efficiencies and services to the Nuveen funds and its responsiveness to the Board’s questions and/or concerns raised throughout the year and during the annual review of advisory agreements. The Board also considered the significant risks borne by the Adviser and its affiliates in connection with their services to the Nuveen funds, including entrepreneurial risks in sponsoring new funds and ongoing risks with managing the funds such as investment, operational, reputational, regulatory, compliance and litigation risks.
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In evaluating services, the Board reviewed various highlights of the initiatives the Adviser and its affiliates have undertaken or continued in 2021 and 2022 to benefit the Nuveen complex and/or particular Nuveen funds and meet the requirements of an increasingly complex regulatory environment including, but not limited to:
| • | Centralization of Functions – ongoing initiatives to centralize investment leadership and create a more cohesive market approach and centralized shared support model (including through the consolidation of certain affiliated sub-advisers) in seeking to operate more effectively and enhance the research capabilities and services to the Nuveen funds; |
| • | Fund Improvements and Product Management Initiatives – continuing to proactively manage the Nuveen fund complex as a whole and at the individual fund level with an aim to continually improve product platforms and investment strategies to better serve shareholders through, among other things, rationalizing the product line and gaining efficiencies through mergers, repositionings and liquidations; launching new funds; reviewing and updating investment policies and benchmarks; soft closing certain funds; modifying the conversion periods on certain share classes; and evaluating and adjusting portfolio management teams as appropriate for various funds; |
| • | Capital Initiatives – continuing to invest capital to support new Nuveen funds with initial capital as well as to support existing funds; |
| • | Compliance Program Initiatives – continuing efforts to mitigate compliance risk with a focus on environmental, social and governance (“ESG”) controls and processes, increase operating efficiencies, implement enhancements to strengthen ongoing execution of key compliance program elements, support international business growth and facilitate integration of Nuveen’s operating model; |
| • | Investment Oversight – preparing reports to the Board addressing, among other things, fund performance; market conditions; investment team matters; product developments; changes to mandates, policies and benchmarks; and other management proposals as well as preparing and coordinating investment presentations to the Board; |
| • | Risk Management and Valuation Services - continuing to oversee and manage risk including, among other things, conducting ongoing calculations and monitoring of risk measures across the Nuveen funds, instituting investment risk controls, providing risk reporting throughout Nuveen, participating in internal oversight committees, dedicating the resources and time to develop the processes necessary to help address fund compliance with the new derivatives rule and continuing to implement an operational risk framework that seeks to provide greater transparency of operational risk matters across the complex as well as provide multiple other risk programs that seek to provide a more disciplined and consistent approach to identifying and mitigating Nuveen’s operational risks. Further, the securities valuation team continues, among other things, to oversee the daily valuation process of the portfolio securities of the funds, maintain the valuation policies and procedures, facilitate valuation committee meetings, manage relationships with pricing vendors, prepare relevant valuation reports and design methods to simplify and enhance valuation workflow within the organization and implement processes and procedures to help address compliance with the new valuation rule applicable to the funds; |
| • | Regulatory Matters – continuing efforts to monitor regulatory trends and advocate on behalf of Nuveen and/or the Nuveen funds, to implement and comply with new or revised rules and mandates and to respond to regulatory inquiries and exams; |
| • | Government Relations – continuing efforts of various Nuveen teams and Nuveen’s affiliates to develop policy positions on a broad range of issues that may impact the Nuveen funds, advocate and communicate these positions to lawmakers and other regulatory authorities and work with trade associations to ensure these positions are represented; |
| • | Business Continuity, Disaster Recovery and Information Security – continuing efforts of Nuveen to periodically test and update business continuity and disaster recovery plans and, together with its affiliates, to maintain an information security program that seeks to identify and manage information security risks, and provide reports to the Board, at least annually, addressing, among other things, management’s security risk assessment, cyber risk profile, potential impact of new or revised laws and regulations, incident tracking and other relevant information technology risk-related reports; |
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Annual Investment Management Agreement Approval Process (Unaudited) (continued)
| • | Distribution Management Services – continuing to manage the distributions among the varying types of Nuveen funds within the Nuveen complex to be consistent with the respective fund’s product design and positioning in striving to deliver those earnings to shareholders in a relatively consistent manner over time as well as assisting in the development of new products or the restructuring of existing funds; and |
| • | with respect specifically to closed-end funds, such continuing services also included: |
| • | • Leverage Management Services – continuing to actively manage the various forms of leverage utilized across the complex, including through committing resources and focusing on sourcing/structure development and bank provider management; |
| • | • Capital Management, Market Intelligence and Secondary Market Services – ongoing capital management efforts which may include at times shelf offerings, tender offers, capital return programs and share repurchases as well as providing market data analysis to help understand closed-end fund ownership cycles and their impact on secondary market trading as well as to improve proxy solicitation efforts; and |
| • | • Closed-end Fund Investor Relations Program – maintaining the closed-end fund investor relations program which, among other things, raises awareness, provides educational materials and cultivates advocacy for closed-end funds and the Nuveen closed-end fund product line. |
The Board further considered the division of responsibilities between the Adviser and the Sub-Adviser and recognized that the Sub-Adviser and its investment personnel generally are responsible for the management of each Fund’s portfolio under the oversight of the Adviser and the Board. The Board considered an analysis of the Sub-Adviser provided by the Adviser which included, among other things, the assets under management of the applicable investment team and changes thereto, a summary of the applicable investment team and changes thereto, the investment process and philosophy of the applicable investment team, the performance of the Nuveen funds sub-advised by the Sub-Adviser over various periods of time and a summary of any significant policy and/or other changes to the Nuveen funds sub-advised by the Sub-Adviser. The Board further considered at the May Meeting or prior meetings evaluations of the Sub-Adviser’s compliance programs and trade execution. The Board noted that the Adviser recommended the renewal of the Sub-Advisory Agreements.
Based on its review, the Board determined, in the exercise of its reasonable business judgment, that it was satisfied with the nature, extent and quality of services provided to the respective Funds under each applicable Advisory Agreement.
B. The Investment Performance of the Funds and Fund Advisers
In evaluating the quality of the services provided by the Fund Advisers, the Board also received and considered a variety of investment performance data of the Nuveen funds they advise. In evaluating performance, the Board recognized that performance data may differ significantly depending on the ending date selected, particularly during periods of market volatility, and therefore considered the broader perspective of performance over a variety of time periods that may include full market cycles. In this regard, the Board reviewed, among other things, Fund performance over the quarter, one-, three- and five-year periods ending December 31, 2021 and March 31, 2022. The performance data prepared for the annual review of the advisory agreements for the Nuveen funds supplemented the fund performance data that the Board received throughout the year at its meetings representing differing time periods. In its review, the Board took into account the discussions with representatives of the Adviser; the Adviser’s analysis regarding fund performance that occurred at these Board meetings with particular focus on funds that were considered performance outliers (both overperformance and underperformance); the factors contributing to the performance; and any recommendations or steps taken to address performance concerns. Regardless of the time period reviewed by the Board, the Board recognized that shareholders may evaluate performance based on their own holding periods which may differ from the periods reviewed by the Board and lead to differing results.
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In its review, the Board reviewed both absolute and relative fund performance during the annual review over the various time periods. With respect to the latter, the Board considered fund performance in comparison to the performance of peer funds (the “Performance Peer Group”) and recognized and/or customized benchmarks (i.e., generally benchmarks derived from multiple recognized benchmarks). For Nuveen funds that had changes in portfolio managers or other significant changes to their investment strategies or policies since March 2019, the Board reviewed certain tracking performance data comparing the performance of such funds before and after such changes. In considering performance data, the Board is aware of certain inherent limitations with such data, including that differences between the objective(s), strategies and other characteristics of the Nuveen funds compared to the respective Performance Peer Group and/or benchmark(s); differences in the composition of the Performance Peer Group over time; and differences in the types and/or levels of any leverage and related costs with that of the Performance Peer Group would all necessarily contribute to differences in performance results and limit the value of the comparative information. Further, the Board recognized the inherent limitations in comparing the performance of an actively managed fund to a benchmark index due to the fund’s pursuit of an investment strategy that does not directly follow the index. To assist the Board in its review of the comparability of the relative performance, the Adviser has ranked the relevancy of the peer group to the Funds as low, medium or high.
The Board also evaluated performance in light of various relevant factors which may include, among other things, general market conditions, issuer-specific information, asset class information, leverage and fund cash flows. In relation to general market conditions, the Board had recognized the recent periods in 2022 of general market volatility and underperformance. In their review from year to year, the Board Members consider and may place different emphasis on the relevant information in light of changing circumstances in market and economic conditions. Further, the Board recognized that the market and economic conditions may significantly impact a fund’s performance, particularly over shorter periods, and such performance may be more reflective of such economic or market events and not necessarily reflective of management skill. Accordingly, depending on the facts and circumstances including any differences between the respective Nuveen fund and its benchmark and/or Performance Peer Group, the Board may be satisfied with a fund’s performance notwithstanding that its performance may be below that of its benchmark or peer group for certain periods. However, with respect to any Nuveen funds for which the Board has identified performance issues, the Board monitors such funds closely until performance improves, discusses with the Adviser the reasons for such results, considers whether any steps are necessary or appropriate to address such issues, and reviews the results of any steps undertaken.
The secondary market trading of shares of the Nuveen closed-end funds also continues to be a priority for the Board given its importance to shareholders, and therefore the Board and/or its Closed-end Fund committee reviews certain performance data reflecting, among other things, the premiums and discounts at which the shares of the closed-end funds have traded over specified periods throughout the year. In its review, the Board considers, among other things, changes to investment mandates and guidelines, distribution policies, leverage levels and types; share repurchases and similar capital market actions; and effective communications programs to build greater awareness and deepen understanding of closed-end funds.
The Board’s determinations with respect to each Fund are summarized below.
For Nuveen Intermediate Duration Municipal Term Fund, the Board noted that the Fund outperformed its benchmark for the one-, three- and five-year periods ended December 31, 2021 and ranked in the first quartile of its Performance Peer Group for the one-year period, third quartile for the three-year period and second quartile for the five-year period ended December 31, 2021. In addition, the Fund outperformed its benchmark and ranked in the first quartile of its Performance Peer Group for the one-, three- and five-year periods ended March 31, 2022. In its review, the Board recognized that the Performance Peer Group was classified as low for relevancy. Based on its review, the Board was generally satisfied with the Fund’s overall performance.
For Nuveen Intermediate Duration Quality Municipal Term Fund, the Board noted that the Fund outperformed its benchmark for the one-, three- and five-year periods ended December 31, 2021 and ranked in the first quartile of its Performance Peer Group
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Annual Investment Management Agreement Approval Process (Unaudited) (continued)
for the one- and five-year periods ended December 31, 2021 and second quartile for the three-year period ended December 31, 2021. In addition, the Fund outperformed its benchmark and ranked in the first quartile of its Performance Peer Group for the one-, three- and five-year periods ended March 31, 2022. In its review, the Board recognized that the Performance Peer Group was classified as low for relevancy. Based on its review, the Board was generally satisfied with the Fund’s overall performance.
C. Fees, Expenses and Profitability
1. Fees and Expenses
As part of its annual review, the Board considered the contractual management fee and net management fee (the management fee after taking into consideration fee waivers and/or expense reimbursements, if any) paid by a Nuveen fund to the Adviser in light of the nature, extent and quality of the services provided. The Board also considered the total operating expense ratio of a fund before and after any fee waivers and/or expense reimbursements. More specifically, the Independent Board Members reviewed, among other things, each fund’s gross and net management fee rates (i.e., before and after expense reimbursements and/or fee waivers, if any) and net total expense ratio in relation to those of a comparable universe of funds (the “Peer Universe”) established by Broadridge (subject to certain exceptions). The Independent Board Members reviewed the methodology Broadridge employed to establish its Peer Universe and recognized that differences between the applicable fund and its respective Peer Universe as well as changes to the composition of the Peer Universe from year to year may limit some of the value of the comparative data. The Independent Board Members take these limitations and differences into account when reviewing comparative peer data. The Independent Board Members also considered a fund’s operating expense ratio as it more directly reflected the shareholder’s costs in investing in the respective fund.
In their review, the Independent Board Members considered, in particular, each fund with a net expense ratio (excluding investment-related costs of leverage) of six basis points or higher compared to that of its peer average (each, an “Expense Outlier Fund”) and an analysis as to the factors contributing to each such fund’s higher relative net expense ratio. In addition, although the Board reviewed a fund’s total net expenses both including and excluding investment-related expenses (i.e., leverage costs) for certain of the closed-end funds, the Board recognized that leverage expenses will vary across funds and in comparison to peers because of differences in the forms and terms of leverage employed by the respective fund. Accordingly, in reviewing the comparative data between a fund and its peers, the Board generally considered the fund’s net expense ratio and fees (excluding leverage costs and leveraged assets) to be higher if they were over 10 basis points higher, slightly higher if they were 6 to 10 basis points higher, in line if they were within approximately 5 basis points higher than the peer average and below if they were below the peer average of the Peer Universe. The Independent Board Members also considered, in relevant part, a fund’s net management fee and net total expense ratio in light of its performance history.
In their review of the fee arrangements for the Nuveen funds, the Independent Board Members considered the management fee schedules, including the complex-wide and fund-level breakpoint schedules, as applicable. The Board noted that across the Nuveen fund complex, the complex-wide fee breakpoints reduced fees by approximately $72.5 million and fund-level breakpoints reduced fees by approximately $89.1 million in 2021.
With respect to the Sub-Adviser, the Board also considered, among other things, the sub-advisory fee schedule paid to the Sub-Adviser in light of the sub-advisory services provided to the respective Fund and comparative data of the fees the Sub-Adviser charges to other clients, if any. In its review, the Board recognized that the compensation paid to the Sub-Adviser is the responsibility of the Adviser, not the Funds.
The Independent Board Members noted that each Fund had a net management fee and a net expense ratio that were below the respective peer averages.
Based on its review of the information provided, the Board determined that each Fund’s management fees (as applicable) to a Fund Adviser were reasonable in light of the nature, extent and quality of services provided to the Fund.
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2. Comparisons with the Fees of Other Clients
In determining the appropriateness of fees, the Board also considered information regarding the fee rates the respective Fund Advisers charged to certain other types of clients and the type of services provided to these other clients. With respect to the Adviser and/or the Sub-Adviser, such other clients may include retail and institutional managed accounts, exchange-traded funds (“ETFs”) sub-advised by the Sub-Adviser that are offered by another fund complex, municipal managed accounts offered by an unaffiliated adviser and private limited partnerships offered by Nuveen. With respect to the Sub-Adviser, the Board reviewed, among other things, the fee range and average fee of municipal retail advisory accounts and municipal institutional accounts as well as the sub-advisory fee the Sub-Adviser received for serving as sub-adviser to certain ETFs offered outside the Nuveen family.
In considering the fee data of other clients, the Board recognized, among other things, that differences in the amount, type and level of services provided to the Nuveen funds relative to other types of clients as well as any differences in portfolio investment policies, the types of assets managed and related complexities in managing such assets, the entrepreneurial and other risks associated with a particular strategy, investor profiles, account sizes and regulatory requirements will contribute to the variations in the fee schedules. The Board recognized the breadth of services the Adviser had provided to the Nuveen funds compared to these other types of clients as the funds operate in a highly regulated industry with increasing regulatory requirements as well as the increased entrepreneurial, legal and regulatory risks that the Adviser incurs in sponsoring and managing the funds. In general, higher fee levels reflect higher levels of service provided by the Adviser, increased investment management complexity, greater product management requirements, and higher levels of business risk or some combination of these factors. The Board further considered that the Sub-Adviser’s fee is essentially for portfolio management services and therefore more comparable to the fees it receives for retail wrap accounts and other external sub-advisory mandates. The Board concluded the varying levels of fees were justified given, among other things, the inherent differences in the products and the level of services provided to the Nuveen funds versus other clients, the differing regulatory requirements and legal liabilities and the entrepreneurial, legal and regulatory risks incurred in sponsoring and advising a registered investment company.
3. Profitability of Fund Advisers
In their review, the Independent Board Members considered information regarding Nuveen’s level of profitability for its advisory services to the Nuveen funds for the calendar years 2021 and 2020. The Board reviewed, among other things, the net margins (pre-tax) for Nuveen Investments, Inc. (“Nuveen Investments”), the gross and net revenue margins (pre- and post-tax and excluding distribution) and the revenues, expenses and net income (pre- and post-tax and before distribution expenses) of Nuveen Investments from the Nuveen funds only; and comparative profitability data comparing the operating margins of Nuveen Investments compared to the adjusted operating margins of certain peers that had publicly available data and with the most comparable assets under management (based on asset size and asset composition) for each of the last two calendar years. The Board also reviewed the revenues, expenses and operating margin (pre- and post-tax) the Adviser derived from its ETF product line for the 2021 and 2020 calendar years.
In reviewing the profitability data, the Independent Board Members recognized the subjective nature of calculating profitability as the information is not audited and is dependent on cost allocation methodologies to allocate corporate-wide overhead/shared service expenses, TIAA (defined below) corporate-wide overhead expenses and partially fund related expenses to the Nuveen complex and its affiliates and to further allocate such expenses between the Nuveen fund and non-fund businesses. The Independent Board Members reviewed a description of the cost allocation methodologies employed to develop the financial information, a summary of the history of changes to the methodology over the years from 2010 to 2021, and the net revenue margins derived from the Nuveen funds (pre-tax and including and excluding distribution) and total company margins from Nuveen Investments compared to the firm-wide adjusted operating margins of the peers for each calendar year from 2012 to 2021.
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Annual Investment Management Agreement Approval Process (Unaudited) (continued)
The Board had also appointed four Independent Board Members to serve as the Board’s liaisons, with the assistance of independent counsel, to review the development of the profitability data and to report to the full Board. In its evaluation, the Board, however, recognized that other reasonable and valid allocation methodologies could be employed and could lead to significantly different results. The Independent Board Members also reviewed a summary of the key drivers that affected Nuveen’s revenues and expenses impacting profitability in 2021 versus 2020.
In reviewing the comparative peer data noted above, the Board considered that the operating margins of Nuveen Investments compared favorably to the peer group range of operating margins; however, the Independent Board Members also recognized the limitations of the comparative data given that peer data is not generally public and the calculation of profitability is subjective and affected by numerous factors (such as types of funds a peer manages, its business mix, its cost of capital, the numerous assumptions underlying the methodology used to allocate expenses and other factors) that can have a significant impact on the results.
Aside from Nuveen’s profitability, the Board recognized that the Adviser is a subsidiary of Nuveen, LLC, the investment management arm of Teachers Insurance and Annuity Association of America (“TIAA”). Accordingly, the Board also reviewed a balance sheet for TIAA reflecting its assets, liabilities and capital and contingency reserves for the 2021 and 2020 calendar years to consider the financial strength of TIAA. The Board recognized the benefit of an investment adviser and its parent with significant resources, particularly during periods of market volatility. The Board also noted the reinvestments Nuveen, its parent and/or other affiliates made into its business through, among other things, the investment of seed capital in certain Nuveen funds and continued investments in enhancements to technological capabilities.
In addition to Nuveen, the Independent Board Members considered the profitability of the Sub-Adviser from its relationships with the Nuveen funds. In this regard, the Independent Board Members reviewed, among other things, the Sub-Adviser’s revenues, expenses and net revenue margins (pre- and post-tax) for its advisory activities to the respective funds for the calendar years ended December 31, 2021 and December 31, 2020. The Independent Board Members also reviewed a profitability analysis reflecting the revenues, expenses and revenue margin (pre- and post-tax) by asset type for the Sub-Adviser for the calendar years ending December 31, 2021 and December 31, 2020 and the pre- and post-tax revenue margins from 2021 and 2020.
In evaluating the reasonableness of the compensation, the Independent Board Members also considered any other ancillary benefits derived by the respective Fund Adviser from its relationship with the Nuveen funds as discussed in further detail below.
Based on a consideration of all the information provided, the Board noted that Nuveen’s and the Sub-Adviser’s level of profitability was acceptable and not unreasonable in light of the services provided.
D. Economies of Scale and Whether Fee Levels Reflect These Economies of Scale
The Board considered whether there have been economies of scale with respect to the management of the Nuveen funds and whether these economies of scale have been appropriately shared with the funds. The Board recognized that although economies of scale are difficult to measure and certain expenses may not decline with a rise in assets, there are several methods to help share the benefits of economies of scale, including breakpoints in the management fee schedule, fee waivers and/or expense limitations, the pricing of Nuveen funds at scale at inception and investments in Nuveen’s business which can enhance the services provided to the funds for the fees paid. The Board noted that Nuveen generally has employed these various methods, and the Board considered the extent to which the Nuveen funds will benefit from economies of scale as their assets grow. In this regard, the Board recognized that the management fee of the Adviser is generally comprised of a fund-level component and a complex-level component each with its own breakpoint schedule, subject to certain exceptions. The Board reviewed the fund-level and complex-level fee schedules. The Board considered that the fund-level breakpoint schedules are designed to share economies of scale with shareholders if the particular fund grows, and the complex-level breakpoint schedule is designed to deliver the benefits of economies of scale to shareholders when the eligible assets in the complex pass certain
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thresholds even if the assets of a particular fund are unchanged or have declined. Further, with respect to the Nuveen closed-end funds, the Independent Board Members noted that, although such funds may from time to time make additional share offerings, the growth of their assets would occur primarily through the appreciation of such funds’ investment portfolios. As noted above, the Independent Board Members also recognized the continued reinvestment in Nuveen’s business.
Based on its review, the Board concluded that the current fee arrangements together with the reinvestment in Nuveen’s business appropriately shared any economies of scale with shareholders.
E. Indirect Benefits
The Independent Board Members received and considered information regarding other benefits the respective Fund Adviser or its affiliates may receive as a result of their relationship with the Nuveen funds. The Board considered the compensation that an affiliate of the Adviser received for serving as co-manager in the initial public offerings of new closed-end funds and for serving as an underwriter on shelf offerings of existing closed-end funds.
In addition, the Independent Board Members also noted that various sub-advisers (including the Sub-Adviser) may engage in soft dollar transactions pursuant to which they may receive the benefit of research products and other services provided by broker-dealers executing portfolio transactions on behalf of the applicable Nuveen funds. However, the Board noted that any benefits for the Sub-Adviser when transacting in fixed-income securities may be more limited as such securities generally trade on a principal basis and therefore do not generate brokerage commissions.
Based on its review, the Board concluded that any indirect benefits received by a Fund Adviser as a result of its relationship with the Funds were reasonable and within acceptable parameters.
F. Other Considerations
The Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, concluded that the terms of each Advisory Agreement were reasonable, that the respective Fund Adviser’s fees were reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
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Board Members &
Officers (Unaudited)
The management of the Funds, including general supervision of the duties performed for the Funds by the Adviser, is the responsibility of the Board of Trustees of the Funds. None of the trustees who are not “interested” persons of the Funds (referred to herein as “independent board members”) has ever been a director or employee of, or consultant to, Nuveen or its affiliates. The names and business addresses of the trustees and officers of the Funds, their principal occupations and other affiliations during the past five years, the number of portfolios each Trustee oversees and other directorships they hold are set forth below.
| Name, | Position(s) Held | Year First | Principal | Number |
| Year of Birth | with the Funds | Elected or | Occupation(s) | of Portfolios |
| & Address | Appointed | Including other | in Fund Complex | |
| and Term(1) | Directorships | Overseen by | ||
| During Past 5 Years | Board Member | |||
| Independent Board Members: | ||||
| • TERENCE J. TOTH | Formerly, a Co-Founding Partner, Promus Capital (investment advisory | |||
| 1959 | firm) (2008-2017); formerly, Director, Quality Control Corporation | |||
| 333 W. Wacker Drive | Chair and | 2008 | (manufacturing) (since 2012-2021); Chair of the Board of the Kehrein | 141 |
| Chicago, IL 6o6o6 | Board Member | Class II | Center for the Arts (philanthropy) (since 2021); member: Catalyst | |
| Schools of Chicago Board (since 2008) and Mather Foundation Board | ||||
| (philanthropy) (since 2012), and chair of its Investment Committee; | ||||
| formerly, Member, Chicago Fellowship Board (philanthropy) (2005-2016); | ||||
| formerly, Director, Fulcrum IT Services LLC (information technology | ||||
| services firm to government entities) (2010-2019); formerly, Director, | ||||
| LogicMark LLC (health services) (2012-2016); formerly, Director, Legal & | ||||
| General Investment Management America, Inc. (asset management) | ||||
| (2008-2013); formerly, CEO and President, Northern Trust Global | ||||
| Investments (financial services) (2004-2007): Executive Vice President, | ||||
| Quantitative Management & Securities Lending (2000-2004); prior | ||||
| thereto, various positions with Northern Trust Company (financial | ||||
| services) (since 1994); formerly, Member, Northern Trust Mutual | ||||
| Funds Board (2005-2007), Northern Trust Global Investments Board | ||||
| (2004-2007), Northern Trust Japan Board (2004-2007), Northern Trust | ||||
| Securities Inc. Board (2003-2007) and Northern Trust Hong Kong | ||||
| Board (1997-2004). | ||||
| • JACK B. EVANS | Chairman (since 2019), formerly, President (1996-2019), The Hall-Perrine | |||
| 1948 | Foundation, (private philanthropic corporation); Life Trustee of Coe | |||
| 333 W. Wacker Drive | Board Member | 1999 | College; formerly, Member and President Pro-Tern of the Board of | 141 |
| Chicago, IL 6o6o6 | Class III | Regents for the State of Iowa University System (2007- 2013); Director | ||
| and Chairman (2009-2021), United Fire Group, a publicly held company; | ||||
| Director, Public Member, American Board of Orthopaedic Surgery | ||||
| (2015-2020); Director (2000-2004), Alliant Energy; Director (1996-2015), | ||||
| The Gazette Company (media and publishing); Director (1997- 2003), | ||||
| Federal Reserve Bank of Chicago; President and Chief Operating | ||||
| Officer (1972-1995), SCI Financial Group, Inc., (regional financial | ||||
| services firm). | ||||
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| Name, | Position(s) Held | Year First | Principal | Number |
| Year of Birth | with the Funds | Elected or | Occupation(s) | of Portfolios |
| & Address | Appointed | Including other | in Fund Complex | |
| and Term(1) | Directorships | Overseen by | ||
| During Past 5 Years | Board Member | |||
| Independent Board Members (continued): | ||||
| •WILLIAM C. HUNTER | Dean Emeritus, formerly, Dean, Tippie College of Business, University of | |||
| 1948 | (2006-2012); Director of Well mark, Inc. (since 2009); past Director | |||
| 333 W. Wacker Drive | Board Member | 2003 | (2005-2015), and past President (2010-2014) Beta Gamma Sigma, Inc., | 141 |
| Chicago, IL 6o6o6 | Class I | The International Business Honor Society; formerly, Director (2004-2018) | ||
| of Xerox Corporation; formerly, Dean and Distinguished Professor of | ||||
| Finance, School of Business at the University of Connecticut (2003-2006); | ||||
| previously, Senior Vice President and Director of Research at the Federal | ||||
| Reserve Bank of Chicago (1995-2003); formerly, Director (1997-2007), | ||||
| Credit Research Center at Georgetown University. | ||||
| •AMY B. R. LANCELLOTTA | Formerly, Managing Director, Independent Directors Council (IDC) | |||
| 1959 | (supports the fund independent director community and is part of the | |||
| 333 W. Wacker Drive | Board Member | 2021 | Investment Company Institute (ICI), which represents regulated | 141 |
| Chicago, IL 6o6o6 | Class II | investment companies) (2006-2019); formerly, various positions with ICI | ||
| (1989-2006); Member of the Board of Directors, Jewish Coalition Against | ||||
| Domestic Abuse (UCADA) (since 2020). | ||||
| •JOANNE T. MEDERO | Formerly, Managing Director, Government Relations and Public Policy | |||
| 1954 | (2009-2020) and Senior Advisor to the Vice Chairman (2018-2020). | |||
| 333 W. Wacker Drive | Board Member | 2021 | BlackRock, Inc. (global investment management firm); formerly, | 141 |
| Chicago, IL 6o6o6 | Class III | Managing (Director, Global Head of Government Relations and Public | ||
| Policy, Barclays Group (IBIM) (investment banking, investment | ||||
| management and wealth management businesses) (2006-2009); | ||||
| formerly, Managing Director, Global General Counsel and Corporate | ||||
| Secretary, Barclays Global Investors (global investment management | ||||
| firm) (1996-2006); formerly, Partner, Orrick, Herrington & Sutcliffe LLP | ||||
| (law firm) (1993-1995); formerly, General Counsel, Commodity Futures | ||||
| Trading Commission (government agency overseeing U.S. derivatives | ||||
| markets) (1989-1993); formerly, Deputy Associate Director/ Associate | ||||
| Director for Legal and Financial Affairs, Office of Presidential Personnel, | ||||
| The White House (1986-1989); Member of the Board of Directors, | ||||
| Baltic-American Freedom Foundation (seeks to provide opportunities | ||||
| for citizens of the Baltic states to gain education and professional | ||||
| development through exchanges in the U.S.) (since 2019). | ||||
| •ALBIN F. MOSCHNER | Founder and Chief Executive Officer, Northcroft Partners, LLC, | |||
| 1952 | (management consulting) (since 2012); formerly, Chairman (2019), and | |||
| 333 W. Wacker Drive | Board Member | 2016 | Director (2012-2019), USA Technologies, Inc., (provider of solutions | 141 |
| Chicago, IL 6o6o6 | Class III | and services to facilitate electronic payment transactions); formerly, | ||
| Director, Wintrust Financial Corporation (1996-2016); previously, held | ||||
| positions at Leap Wireless International, Inc., (consumer wireless | ||||
| services) including Consultant (2011- 2012), Chief Operating Officer | ||||
| (2008-2011), and Chief Marketing Officer (2004- 2008); formerly, | ||||
| President, Verizon Card Services division of Verizon Communications, | ||||
| Inc. (2000-2003); formerly, President, One Point Services at One Point | ||||
| Communications (telecommunication services) (1999-2000); formerly, | ||||
| Vice Chairman of the Board, Diba, Incorporated (internet technology | ||||
| provider) (1996-1997); formerly, various executive positions (1991-1996) | ||||
| including Chief Executive Officer (1995-1996) of Zenith Electronics | ||||
| Corporation (consumer electronics). | ||||
101
Board Members & Officers (Unaudited) (continued)
| Name, | Position(s) Held | Year First | Principal | Number |
| Year of Birth | with the Funds | Elected or | Occupation(s) | of Portfolios |
| & Address | Appointed | Including other | in Fund Complex | |
| and Term(1) | Directorships | Overseen by | ||
| During Past 5 Years | Board Member | |||
| Independent Board Members (continued): | ||||
| •JOHN K. NELSON | Member of Board of Directors of Core12 LLC. (private firm which | |||
| 1962 | develops branding, marketing and communications strategies for | |||
| 333 W. Wacker Drive | Board Member | 2013 | clients) (since 2008); served on The President’s Council of Fordham | 141 |
| Chicago, IL 6o6o6 | Class II | University (2010-2019) and previously a Director of the Curran Center | ||
| for Catholic American Studies (2009- 2018); formerly, senior external | ||||
| advisor to the Financial Services practice of Deloitte Consulting LLP. | ||||
| (2012-2014); former Chair of the Board of Trustees of Marian University | ||||
| (2010-2014 as trustee, 2011-2014 as Chair); formerly Chief Executive Officer | ||||
| of ABN AMRO Bank N.V., North America, and Global Head of the | ||||
| Financial Markets Division (2007-2008), with various executive leadership | ||||
| roles in ABN AMRO Bank N.V. between 1996 and 2007. | ||||
| •JUDITH M. STOCKDALE | Board Member, Land Trust Alliance (national public charity addressing | |||
| 1947 | natural land and water conservation in the U.S.) (since 2013); formerly, | |||
| 333 W. Wacker Drive | Board Member | 1997 | Board Member, U.S. Endowment for Forestry and Communities (national | 141 |
| Chicago, IL 6o6o6 | Class I | endowment addressing forest health, sustainable forest production and | ||
| markets, and economic health of forest-reliant communities in the U.S.) | ||||
| (2013-2019); formerly, Executive Director (1994-2012), Gaylord and Dorothy | ||||
| Donnelley Foundation (private foundation endowed to support both natural | ||||
| land conservation and artistic vitality); prior thereto, Executive Director, | ||||
| Great Lakes Protection Fund (endowment created jointly by seven of the | ||||
| eight Great Lake states’ Governors to take a regional approach to improving | ||||
| the health of the Great Lakes) (1990-1994). | ||||
| •CAROLE E. STONE | Former Director, Chicago Board Options Exchange, Inc. (2006-2017); | |||
| 1947 | and C2 Options Exchange, Incorporated (2009-2017); formerly Director, | |||
| 333 W. Wacker Drive | Board Member | 2007 | Cboe, Global Markets, Inc., (2010-2020) formerly named CBOE Holdings, | 141 |
| Chicago, IL 6o6o6 | Class I | Inc.; formerly, Commissioner, New York State Commission on Public | ||
| Authority Reform (2005-2010). | ||||
| •MATTHEW THORNTON III | Formerly, Executive Vice President and Chief Operating Officer (2018-2019), | |||
| 1958 | Fed Ex Freight Corporation, a subsidiary of FedEx Corporation (“FedEx”) | |||
| 333 W. Wacker Drive | Board Member | 2020 | (provider of transportation, e-commerce and business services through | 141 |
| Chicago, IL 6o6o6 | Class III | its portfolio of companies); formerly, Senior Vice President, U.S. | ||
| Operations (2006-2018), Federal Express Corporation, a subsidiary of | ||||
| FedEx; formerly, Member of the Board of Directors (2012-2018), Safe Kids | ||||
| Worldwide®(a non-profit organization dedicated to preventing childhood | ||||
| injuries). Member of the Board of Directors (since 2014), The | ||||
| Sherwin-Williams Company (develops, manufactures, distributes and sells | ||||
| paints, coatings and related products); Director (since 2020), Crown | ||||
| Castle International (provider of communications infrastructure). | ||||
| •MARGARET L. WOLFF | Formerly, member of the Board of Directors (2013-2017) of Travelers | |||
| 1955 | Insurance Company of Canada and The Dominion of Canada General | |||
| 333 W. Wacker Drive | Board Member | 2016 | Insurance Company (each, a part of Travelers Canada, the Canadian | 141 |
| Chicago, IL 6o6o6 | Class I | operation of The Travelers Companies, Inc.); formerly, Of Counsel, | ||
| Skadden, Arps, Slate, Meagher & Flom LLP (Mergers & Acquisitions | ||||
| Group) (legal services) (2005-2014); Member of the Board of Trustees | ||||
| of New York-Presbyterian Hospital (since 2005); Member (since 2004), | ||||
| formerly, Chair (2015-2022) of the Board of Trustees of The John A. | ||||
| Hartford Foundation (philanthropy dedicated to improving the care of | ||||
| older adults); formerly, Member (2005-2015) and Vice Chair (2011-2015) | ||||
| of the Board of Trustees of Mt. Holyoke College. | ||||
102
| Name, | Position(s) Held | Year First | Principal | Number |
| Year of Birth | with the Funds | Elected or | Occupation(s) | of Portfolios |
| & Address | Appointed | Including other | in Fund Complex | |
| and Term(1) | Directorships | Overseen by | ||
| During Past 5 Years | Board Member | |||
| Independent Board Members (continued): | ||||
| •ROBERT L. YOUNG | Formerly, Chief Operating Officer and Director, J.P.Morgan Investment | |||
| 1963 | Management Inc. (financial services) (2010-2016); formerly, President | |||
| 333 W. Wacker Drive | Board Member | 2017 | and Principal Executive Officer (2013-2016), and Senior Vice President | 141 |
| Chicago, IL 6o6o6 | Class II | and Chief Operating Officer (2005-2010), of J.P.Morgan Funds; formerly, | ||
| Director and various officer positions for J.P.Morgan Investment | ||||
| Management Inc. (formerly, JPMorgan Funds Management, Inc. and | ||||
| formerly, One Group Administrative Services) and JPMorgan | ||||
| Distribution Services, Inc. (financial services) (formerly, One Group | ||||
| Dealer Services, Inc.) (1999-2017). | ||||
103
Board Members & Officers (Unaudited) (continued)
| Name, | Position(s) Held | Year First | Principal |
| Year of Birth | with the Funds | Elected or | Occupation(s) |
| & Address | Appointed(2) | During Past 5 Years | |
| Officers of the Funds: | |||
| •DAVID J. LAMB | Managing Director of Nuveen Fund Advisors, LLC (since 2019) Senior Managing Director | ||
| 1963 | Chief | (since 2021), formerly, Managing Director (2020-2021) of Nuveen Securities, LLC; Senior | |
| 333 W. Wacker Drive | Administrative | 2015 | Managing Director (since 2021), formerly, Managing Director (2017-2021), Senior Vice President of |
| Chicago, IL 6o6o6 | Officer | Nuveen (2006-2017), Vice President prior to 2006. | |
| •BRETT E. BLACK | Enterprise Senior Compliance Officer of Nuveen (since 2022); formerly, Vice President (2014-2022), | ||
| 1972 | Vice President | Chief Compliance Officer (2017-2022), Deputy Chief Compliance Officer (2014-2017) and Senior | |
| 333 W. Wacker Drive | and Chief | 2022 | Compliance Officer (2012-2014) of BMO Funds, Inc.; formerly Senior Compliance Officer of BMO |
| Chicago, IL 6o6o6 | Compliance | Asset Management Corp. (2012-2014). | |
| Officer | |||
| •MARK J. CZARNIECKI | Vice President and Assistant Secretary of Nuveen Securities, LLC (since 2016) ; Managing Director | ||
| 1979 | Vice President | (since 2022), formerly, Vice President (2017-2022) and Assistant Secretary (since 2017) of Nuveen | |
| 901 Marquette Avenue | and Assistant | 2013 | Fund Advisors, LLC; Managing Director and Associate General Counsel (since January |
| Minneapolis, MN 55402 | Secretary | 2022), formerly, Vice President and Associate General Counsel of Nuveen (2013-2021); Managing | |
| Director (since 2022), formerly, Vice President (2018-2022), Assistant Secretary and Associate | |||
| General Counsel (since 2018) of Nuveen Asset Management LLC. | |||
| •DIANA R. GONZALEZ | Vice President and Assistant Secretary of Nuveen Fund Advisors, LLC (since 2017); Vice President, | ||
| 1978 | Vice President | Associate General Counsel and Assistant Secretary of Nuveen Asset Management, LLC (since | |
| 8500 Andrew Carnegie Blvd. | and Assistant | 2017 | 2022); Vice President and Associate General Counsel of Nuveen (since 2017); formerly, Associate |
| Charlotte, NC 28262 | Secretary | General Counsel of Jackson National Asset Management (2012-2017). | |
| •NATHANIEL T. JONES | Senior Managing Director (since 2021), formerly, Managing Director (2017-2021), Senior Vice | ||
| 1979 | President (2016-2017), Vice President (2011-2016) of Nuveen; Managing Director (since 2015) of | ||
| 333 W. Wacker Drive | Vice President | 2016 | Nuveen Fund Advisors, LLC; Chartered Financial Analyst. |
| Chicago, IL 6o6o6 | and Treasurer | ||
| •TINA M. LAZAR | Managing Director (since 2017), formerly, Senior Vice President (2014-2017) of | ||
| 1961 | Nuveen Securities, LLC. | ||
| 333 W. Wacker Drive | Vice President | 2002 | |
| Chicago, IL 6o6o6 | |||
| •BRIAN J. LOCKHART | Managing Director (since 2019) of Nuveen Fund Advisors, LLC; Senior Managing Director (since | ||
| 1974 | 2021), formerly, Managing Director (2017-2021), Vice President (2010-2017) of Nuveen; Head of | ||
| 333 W. Wacker Drive | Vice President | 2019 | Investment Oversight (since 2017), formerly, Team Leader of Manager Oversight (2015-2017); |
| Chicago, IL 6o6o6 | Chartered Financial Analyst and Certified Financial Risk Manager. | ||
| •JACQUES M. LONGERSTAEY | Senior Managing Director, Chief Risk Officer, Nuveen, LLC (since May 2019); Senior Managing | ||
| 1963 | Director (since May 2019) of Nuveen Fund Advisors, LLC; formerly, Chief Investment and Model | ||
| 8500 Andrew Carnegie Blvd. | Vice President | 2019 | Risk Officer, Wealth & Investment Management Division, Wells Fargo Bank (NA) (2013-2019). |
| Charlotte, NC 28262 | |||
| •JOHN M. MCCANN | Managing Director and Assistant Secretary of Nuveen Fund Advisors, LLC (since 2021); Managing | ||
| 1975 | Director, Associate General Counsel and Assistant Secretary of Nuveen Asset Management, LLC | ||
| 8500 Andrew Carnegie Blvd. | Vice President | 2013 | (since 2021); Managing Director of TIAA SMA Strategies LLC (since 2021); Managing Director (since |
| Charlotte, NC 28262 | and Assistant | 2019, formerly, Vice President and Director), Associate General Counsel and Assistant Secretary of | |
| Secretary | College Retirement Equities Fund, TIAA Separate Account VA-1, TIAA-CREF Funds and TIAA-CREF | ||
| Life Funds; Managing Director (since 2018), formerly, Vice President and Director, Associate | |||
| General Counsel and Assistant Secretary of Teachers Insurance and Annuity Association of America, | |||
| Teacher Advisors LLC and TIAA-CREF Investment Management, LLC; Vice President (since 2017), | |||
| Associate General Counsel and Assistant Secretary (since 2011) of Nuveen Alternative Advisors LLC; | |||
| General Counsel and Assistant Secretary of Covariance Capital Management, Inc. (2014-2017). | |||
104
| Name, | Position(s) Held | Year First | Principal |
| Year of Birth | with the Funds | Elected or | Occupation(s) |
| & Address | Appointed(2) | During Past 5 Years | |
| Officers of the Funds (continued): | |||
| •KEVIN J. MCCARTHY | Senior Managing Director (since 2017) and Secretary and General Counsel (since 2016) of Nuveen | ||
| 1966 | Vice President | Investments, Inc., formerly, Executive Vice President (2016-2017) and Managing Director and | |
| 333 W. Wacker Drive | and Assistant | 2007 | Assistant Secretary (2008-2016); Senior Managing Director (since 2017) and Assistant Secretary |
| Chicago, IL 6o6o6 | Secretary | (since 2008) of Nuveen Securities, LLC, formerly Executive Vice President (2016-2017) and | |
| Managing Director (2008- 2016); Senior Managing Director (since 2017), and Secretary (since | |||
| 2016) of Nuveen Fund Advisors, LLC, formerly, Co-General Counsel (2011-2020), Executive Vice | |||
| President (2016-2017), Managing Director (2008-2016) and Assistant Secretary (2007-2016); Senior | |||
| Managing Director (since 2017), Secretary (since 2016) of Nuveen Asset Management, LLC, | |||
| formerly, Associate General Counsel (2011-2020), Executive Vice President (2016-2017) and | |||
| Managing Director and Assistant Secretary (2011- 2016); formerly, Vice President (2007-2021) and | |||
| Secretary (2016-2021), of NWQ Investment Management Company, LLC, and Santa Barbara Asset | |||
| Management, LLC; Vice President and Secretary of Winslow Capital Management, LLC (since 2010). | |||
| Senior Managing Director (since 2017) and Secretary (since 2016) of Nuveen Alternative | |||
| Investments, LLC. | |||
| •JON SCOTT MEISSNER | Managing Director of Mutual Fund Tax and Financial Reporting groups at Nuveen (since 2017); | ||
| 1973 | Vice President | Managing Director of Nuveen Fund Advisors, LLC (since 2019); Senior Director of Teachers | |
| 8500 Andrew Carnegie Blvd. | and Assistant | 2019 | Advisors, LLC and TIAA-CREF Investment Management, LLC (since 2016); Senior Director (since |
| Charlotte, NC 28262 | Secretary | 2015) Mutual Fund Taxation to the TIAA-CREF Funds, the TIAA-CREF Life Funds, the TIAA Separate | |
| Account VA-1 and the CREF Accounts; has held various positions with TIAA since 2004. | |||
| •DEANN D. MORGAN | President, Nuveen Fund Advisors, LLC (since 2020); Executive Vice President, Global Head of | ||
| 1969 | Product at Nuveen (since 2019); Co-Chief Executive Officer of Nuveen Securities, LLC since 2020); | ||
| 730 Third Avenue | Vice President | 2020 | Managing Member of MDR Collaboratory LLC (since 2018); formerly, Managing Director, (Head of |
| New York, NY 10017 | Wealth Management Product Structuring & COO Multi Asset Investing. The Blackstone Group | ||
| (2013-2017). | |||
| •WILLIAM A. SIFFERMANN | Managing Director (since 2017), formerly Senior Vice President (2016-2017) and Vice President | ||
| 1975 | (2011-2016) of Nuveen. | ||
| 333 W. Wacker Drive | Vice President | 2017 | |
| Chicago, IL 6o6o6 | |||
| •E. SCOTT WICKERHAM | Senior Managing Director, Head of Public Investment Finance at Nuveen (since 2019), formerly, | ||
| 1973 | Vice President | Managing Director; Senior Managing Director (since 2019) of Nuveen Fund Advisers, (LLC; | |
| 8500 Andrew Carnegie Blvd. | and Controller | 2019 | Principal Financial Officer, Principal Accounting Officer and Treasurer (since 2017) of the TIAA |
| Charlotte, NC 28262 | CREF Funds, the TIAA-CREF Life Funds, the TIAA Separate Account VA-1 and Principal Financial | ||
| Financial Officer, Principal Accounting Officer (since 2020) and Treasurer (since 2017) to the CREF | |||
| Accounts; formerly, Senior Director, TIAA-CREF Fund Administration (2014-2015); has held various | |||
| positions with TIAA since 2006. | |||
105
Board Members & Officers (Unaudited) (continued)
| Name, | Position(s) Held | Year First | Principal |
| Year of Birth | with the Funds | Elected or | Occupation(s) |
| & Address | Appointed(2) | During Past 5 Years | |
| Officers of the Funds (continued): | |||
| •MARK L. WINGET | Vice President and Assistant Secretary of Nuveen Securities, LLC (since 2008), and Nuveen Fund | ||
| 1968 | Vice President | Advisors, LLC (since 2019); Vice President, Associate General Counsel and Assistant Secretary of | |
| 333 W. Wacker Drive | and Secretary | 2008 | Nuveen Asset Management, LLC (since 2020); Vice President (since 2010) and Associate General |
| Chicago, IL 60606 | Counsel (since 2019), formerly, Assistant General Counsel (2008-2016) of Nuveen. | ||
| •GIFFORD R. ZIMMERMAN | Managing Director and Assistant Secretary of Nuveen Securities, LLC (since 2022); | ||
| 1956 | Vice President | Managing Director, Assistant Secretary and General Counsel (since 2022), formerly, | |
| 333 W. Wacker Drive | and Assistant | 1988 | Co-General Counsel (2011- 2020) of Nuveen Fund Advisors, LLC; formerly, Managing Director |
| Chicago, IL 60606 | Secretary | (2004-2020) and Assistant Secretary (1994-2020) of Nuveen Investments, Inc.; Managing Director, | |
| Assistant Secretary and Associate General Counsel (since 2022) of Nuveen Asset Management, | |||
| LLC; formerly, Vice President and Assistant Secretary of NWQ Investment Management Company, | |||
| LLC (2002-2020), Santa Barbara Asset Management, LLC (2006-2020) and Winslow Capital | |||
| Management, LLC (2010-2020); Chartered Financial Analyst. | |||
| (1) | The Board of Trustees is divided into three classes, Class I, Class11, and Class 111, with each being elected to serve until the third succeeding annual shareholders’ meeting subsequent to its election or thereafter in each case when its respective successors are duly elected or appointed, except two board members are elected by the holders of Preferred Shares, when applicable, to serve until the next annual shareholders’ meeting subsequent to its election or thereafter in each case when its respective successors are duly elected or appointed. The year first elected or appointed represents the year in which the board member was first elected or appointed to any fund in the Nuveen complex. |
| (2) | Officers serve indefinite terms until their successor has been duly elected and qualified, their death or their resignation or removal. The year first elected or appointed represents the year in which the Officer was first elected or appointed to any fund in the Nuveen complex. |
106
Notes
107
Nuveen:
Serving Investors for Generations
Since 1898, financial professionals and their clients have relied on Nuveen to provide dependable investment solutions through continued adherence to proven, long-term investing principles. Today, we offer a range of high quality solutions designed to be integral components of a well-diversified core portfolio.
Focused on meeting investor needs.
Nuveen is the investment manager of TIAA. We have grown into one of the world’s premier global asset managers, with specialist knowledge across all major asset classes and particular strength in solutions that provide income for investors and that draw on our expertise in alternatives and responsible investing. Nuveen is driven not only by the independent investment processes across the firm, but also the insights, risk management, analytics and other tools and resources that a truly world-class platform provides. As a global asset manager, our mission is to work in partnership with our clients to create solutions which help them secure their financial future.
Find out how we can help you.
To learn more about how the products and services of Nuveen may be able to help you meet your financial goals, talk to your financial professional, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Investors should consider the investment objective and policies, risk considerations, charges and expenses of any investment carefully. Where applicable, be sure to obtain a prospectus, which contains this and other relevant information. To obtain a prospectus, please contact your securities representative or Nuveen, 333 W. Wacker Dr., Chicago, IL 60606. Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: www.nuveen.com/closed-end-funds
Nuveen Securities, LLC member of FINRA and SIPC | 333 West Wacker Drive Chicago, IL 60606 | www.nuveen.com
EAN-B-0522D 2261249-INV-Y-07/23
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. There were no amendments to or waivers from the Code during the period covered by this report. The registrant has posted the code of ethics on its website at www.nuveen.com/fund-governance. (To view the code, click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
As of the end of the period covered by this report, the registrant’s Board of Directors or Trustees (“Board”) determined that the registrant has at least one “audit committee financial expert” (as defined in Item 3 of Form N-CSR) serving on its Audit Committee. The registrant’s audit committee financial experts are Carole E. Stone, Jack B. Evans, Albin F. Moschner, John K. Nelson and Robert L. Young, who are “independent” for purposes of Item 3 of Form N-CSR.
Ms. Stone served for five years as Director of the New York State Division of the Budget. As part of her role as Director, Ms. Stone was actively involved in overseeing the development of the State’s operating, local assistance and capital budgets, its financial plan and related documents; overseeing the development of the State’s bond-related disclosure documents and certifying that they fairly presented the State’s financial position; reviewing audits of various State and local agencies and programs; and coordinating the State’s system of internal audit and control. Prior to serving as Director, Ms. Stone worked as a budget analyst/examiner with increasing levels of responsibility over a 30 year period, including approximately five years as Deputy Budget Director. Ms. Stone has also served as Chair of the New York State Racing Association Oversight Board, as Chair of the Public Authorities Control Board, as a Commissioner on the New York State Commission on Public Authority Reform and as a member of the Boards of Directors of several New York State public authorities. These positions have involved overseeing operations and finances of certain entities and assessing the adequacy of project/entity financing and financial reporting. Ms. Stone formerly served on the Board of Directors of CBOE Global Markets, Inc. (formerly, CBOE Holdings, Inc.), the Chicago Board Options Exchange, and the C2 Options Exchange. Ms. Stone’s position on the boards of these entities and as a member of both CBOE Holdings’ Audit Committee and its Finance Committee involved, among other things, the oversight of audits, audit plans and preparation of financial statements.
Mr. Evans was formerly President and Chief Operating Officer of SCI Financial Group, Inc., a full service registered broker-dealer and registered investment adviser (“SCI”). As part of his role as President and Chief Operating Officer, Mr. Evans actively supervised the Chief Financial Officer (the “CFO”) and actively supervised the CFO’s preparation of financial statements and other filings with various regulatory authorities. In such capacity, Mr. Evans was actively involved in the preparation of SCI’s financial statements and the resolution of issues raised in connection therewith. Mr. Evans has also served on the audit committee of various reporting companies. At such companies, Mr. Evans was involved in the oversight of audits, audit plans, and the preparation of financial statements. Mr. Evans also formerly chaired the audit committee of the Federal Reserve Bank of Chicago.
Mr. Moschner is a consultant in the wireless industry and, in July 2012, founded Northcroft Partners, LLC, a management consulting firm that provides operational, management and governance solutions. Prior to founding Northcroft Partners, LLC, Mr. Moschner held various positions at Leap Wireless International, Inc., a provider of wireless services, where he was as a consultant from February 2011 to July 2012, Chief Operating Officer from July 2008 to February 2011, and Chief Marketing Officer from August 2004 to June 2008. Before he joined Leap Wireless International, Inc., Mr. Moschner was President of the Verizon Card Services division of Verizon Communications, Inc. from 2000 to 2003, and President of One Point Services at One Point Communications from 1999 to 2000. Mr. Moschner also served at Zenith Electronics Corporation as Director, President and Chief Executive Officer from 1995 to 1996, and as Director, President and Chief Operating Officer from 1994 to 1995.
Mr. Nelson is on the Board of Directors of Core12, LLC. (since 2008), a private firm which develops branding, marketing, and communications strategies for clients. Mr. Nelson has extensive experience in global banking and markets, having served in several senior executive positions with ABN AMRO Holdings N.V. and its affiliated entities and predecessors, including LaSalle Bank Corporation from 1996 to 2008, ultimately serving as Chief Executive Officer of ABN AMRO N.V. North America. During his tenure at the bank, he also served as Global Head of its Financial Markets Division, which encompassed the bank’s Currency, Commodity, Fixed Income, Emerging Markets, and Derivatives businesses. He was a member of the Foreign Exchange Committee of the Federal Reserve Bank of the United States and during his tenure with ABN AMRO served as the bank’s representative on various committees of The Bank of Canada, European Central Bank, and The Bank of England. Mr. Nelson previously served as a senior, external advisor to the financial services practice of Deloitte Consulting LLP. (2012-2014).
Mr. Young has more than 30 years of experience in the investment management industry. From 1997 to 2017, he held various positions with J.P. Morgan Investment Management Inc. (“J.P. Morgan Investment”) and its affiliates (collectively, “J.P. Morgan”). Most recently, he served as Chief Operating Officer and Director of J.P. Morgan Investment (from 2010 to 2016) and as President and Principal Executive Officer of the J.P. Morgan Funds (from 2013 to 2016). As Chief Operating Officer of J.P. Morgan Investment, Mr. Young led service, administration and business platform support activities for J.P. Morgan’s domestic retail mutual fund and institutional commingled and separate account businesses, and co-led these activities for J.P. Morgan’s global retail and institutional investment management businesses. As President of the J.P. Morgan Funds, Mr. Young interacted with various service providers to these funds, facilitated the relationship between such funds and their boards, and was directly involved in establishing board agendas, addressing regulatory matters, and establishing policies and procedures. Before joining J.P. Morgan, Mr. Young, a former Certified Public Accountant (CPA), was a Senior Manager (Audit) with Deloitte & Touche LLP (formerly, Touche Ross LLP), where he was employed from 1985 to 1996. During his tenure there, he actively participated in creating, and ultimately led, the firm’s midwestern mutual fund practice.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Nuveen Intermediate Duration Quality Municipal Term Fund
The following tables show the amount of fees that KPMG LLP, the Fund’s auditor, billed to the Fund during the Fund’s last two full fiscal years. For engagements with KPMG LLP the Audit Committee approved in advance all audit services and non-audit services that KPMG LLP provided to the Fund, except for those non-audit services that were subject to the pre-approval exception under Rule 2-01 of Regulation S-X (the “pre-approval exception”). The pre-approval exception for services provided directly to the Fund waives the pre-approval requirement for services other than audit, review or attest services if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid by the Fund to its accountant during the fiscal year in which the services are provided; (B) the Fund did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee’s attention, and the Committee (or its delegate) approves the services before the audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its Chair (or, in her absence, any other member of the Audit Committee).
SERVICES THAT THE FUND’S AUDITOR BILLED TO THE FUND
| Audit Fees Billed | Audit-Related Fees | Tax Fees | All Other Fees | |||||||||||||
| Fiscal Year Ended | to Fund 1 | Billed to Fund 2 | Billed to Fund 3 | Billed to Fund 4 | ||||||||||||
| May 31, 2022 | $ | 30,150 | $ | 0 | $ | 0 | $ | 0 | ||||||||
| Percentage approved | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
| pursuant to | ||||||||||||||||
| pre-approval | ||||||||||||||||
| exception | ||||||||||||||||
| May 31, 2021 | $ | 29,010 | $ | 0 | $ | 0 | $ | 0 | ||||||||
| Percentage approved | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
| pursuant to | ||||||||||||||||
| pre-approval | ||||||||||||||||
| exception | ||||||||||||||||
1 "Audit Fees" are the aggregate fees billed for professional services for the audit of the Fund's annual financial statements and services provided in connection with statutory and regulatory filings or engagements.
2 "Audit Related Fees" are the aggregate fees billed for assurance and related services reasonably related to the performance of the audit or review of financial statements that are not reported under "Audit Fees". These fees include offerings related to the Fund's common shares and leverage.
3 "Tax Fees" are the aggregate fees billed for professional services for tax advice, tax compliance, and tax planning. These fees include: all global withholding tax services; excise and state tax reviews; capital gain, tax equalization and taxable basis calculation performed by the principal accountant.
4 "All Other Fees" are the aggregate fees billed for products and services other than "Audit Fees", "Audit-Related Fees" and "Tax Fees". These fees represent all "Agreed-Upon Procedures" engagements pertaining to the Fund's use of leverage.
SERVICES THAT THE FUND’S AUDITOR BILLED TO THE ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by KPMG LLP to Nuveen Fund Advisors, LLC (formerly Nuveen Fund Advisors, Inc.) (the “Adviser”), and any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Fund (“Affiliated Fund Service Provider”), for engagements directly related to the Fund’s operations and financial reporting, during the Fund’s last two full fiscal years.
The tables also show the percentage of fees subject to the pre-approval exception. The pre-approval exception for services provided to the Adviser and any Affiliated Fund Service Provider (other than audit, review or attest services) waives the pre-approval requirement if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid to KPMG LLP by the Fund, the Adviser and Affiliated Fund Service Providers during the fiscal year in which the services are provided that would have to be pre-approved by the Audit Committee; (B) the Fund did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee’s attention, and the Committee (or its delegate) approves the services before the Fund’s audit is completed.
| Audit-Related Fees | Tax Fees Billed to | All Other Fees | |
| Billed to Adviser and | Adviser and | Billed to Adviser | |
| Affiliated Fund | Affiliated Fund | and Affiliated Fund | |
| Fiscal Year Ended | Service Providers | Service Providers | Service Providers |
| May 31, 2022 | $ 0 | $ 0 | $ 0 |
| Percentage approved | 0% | 0% | 0% |
| pursuant to | |||
| pre-approval | |||
| exception | |||
| May 31, 2021 | $ 0 | $ 0 | $ 0 |
| Percentage approved | 0% | 0% | 0% |
| pursuant to | |||
| pre-approval | |||
| exception |
NON-AUDIT SERVICES
The following table shows the amount of fees that KPMG LLP billed during the Fund’s last two full fiscal years for non-audit services. The Audit Committee is required to pre-approve non- audit services that KPMG LLP provides to the Adviser and any Affiliated Fund Services Provider, if the engagement related directly to the Fund’s operations and financial reporting (except for those subject to the pre-approval exception described above). The Audit Committee requested and received information from KPMG LLP about any non-audit services that KPMG LLP rendered during the Fund’s last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating KPMG LLP’s independence.
| Total Non-Audit Fees | ||||
| billed to Adviser and | ||||
| Affiliated Fund Service | Total Non-Audit Fees | |||
| Providers (engagements | billed to Adviser and | |||
| related directly to the | Affiliated Fund Service | |||
| Total Non-Audit Fees | operations and financial | Providers (all other | ||
| Fiscal Year Ended | Billed to Fund | reporting of the Fund) | engagements) | Total |
| May 31, 2022 | $ 0 | $ 0 | $ 0 | $ 0 |
| May 31, 2021 | $ 0 | $ 0 | $ 0 | $ 0 |
"Non-Audit Fees billed to Fund" for both fiscal year ends represent "Tax Fees" and "All Other Fees" billed to Fund in their respective
amounts from the previous table.
Less than 50 percent of the hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit Committee must approve (i) all non-audit services to be performed for the Fund by the Fund’s independent accountants and (ii) all audit and non-audit services to be performed by the Fund’s independent accountants for the Affiliated Fund Service Providers with respect to operations and financial reporting of the Fund. Regarding tax and research projects conducted by the independent accountants for the Fund and Affiliated Fund Service Providers (with respect to operations and financial reports of the Fund) such engagements will be (i) pre-approved by the Audit Committee if they are expected to be for amounts greater than $10,000; (ii) reported to the Audit Committee chair for her verbal approval prior to engagement if they are expected to be for amounts under $10,000 but greater than $5,000; and (iii) reported to the Audit Committee at the next Audit Committee meeting if they are expected to be for an amount under $5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant’s Board has a separately designated Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78c(a)(58)(A)). As of the end of the period covered by this report the members of the audit committee are Jack B. Evans, John K. Nelson, Albin F. Moschner, Judith M. Stockdale, Carole E. Stone, Chair, and Robert L. Young.
ITEM 6. SCHEDULE OF INVESTMENTS.
a) See Portfolio of Investments in Item 1.
b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Nuveen Fund Advisors, LLC is the registrant’s investment adviser (referred to herein as the “Adviser”). The Adviser is responsible for the on-going monitoring of the Fund’s investment portfolio, managing the Fund’s business affairs and providing certain clerical, bookkeeping and administrative services. The Adviser has engaged Nuveen Asset Management, LLC (“Sub-Adviser”) as Sub-Adviser to provide discretionary investment advisory services. As part of these services, the Adviser has delegated to the Sub-Adviser the full responsibility for proxy voting on securities held in the registrant’s portfolio and related duties in accordance with the Sub-Adviser’s policies and procedures. The Adviser periodically monitors the Sub-Adviser’s voting to ensure that it is carrying out its duties. The Sub-Adviser’s proxy voting policies and procedures are attached to this filing as an exhibit and incorporated herein by reference.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Nuveen Fund Advisors, LLC is the registrant’s investment adviser (also referred to as the “Adviser”). The Adviser is responsible for the selection and on-going monitoring of the Fund’s investment portfolio, managing the Fund’s business affairs and providing certain clerical, bookkeeping and administrative services. The Adviser has engaged Nuveen Asset Management, LLC (“Nuveen Asset Management” or “Sub-Adviser”) as Sub-Adviser to provide discretionary investment advisory services. The following section provides information on the portfolio manager at the Sub-Adviser:
ITEM 8(a)(1). PORTFOLIO MANAGER BIOGRAPHY
As of the date of filing this report, the following individual at the Sub-Adviser (the “Portfolio Manager”) has primary responsibility for the day-to-day implementation of the Fund’s investment strategy:
Daniel J. Close, CFA, Managing Director at Nuveen Asset Management, is a portfolio manager on the municipal fixed income team and the head of taxable municipals. He serves as lead portfolio manager and manages a team dedicated to taxable municipal fixed income strategies, which encompasses customized institutional portfolios and closed-end funds. In addition, Daniel also manages a number of intermediate and long duration tax-exempt state and national strategies for both open-end and closed-end funds. He also serves on the Custom Fixed Income Solutions team, which sets asset allocation across multi-sector portfolios. Prior to his current role, he served as a municipal fixed income research analyst covering the corporate-backed, energy, transportation and utility sectors. He received his BS in Business from Miami University and his MBA from Northwestern University’s Kellogg School of Management. Mr. Close has earned the Chartered Financial Analyst designation and is a member of the CFA Institute and the CFA Society of Chicago.
ITEM 8(a)(2). OTHER ACCOUNTS MANAGED BY PORTFOLIO MANAGER
Other Accounts Managed. In addition to managing the registrant, the portfolio manager is also primarily responsible for the day-to-day portfolio management of the following accounts:
|
Portfolio Manager |
Type of Account |
Number of |
Assets* |
| Daniel J. Close | Registered Investment Company | 10 | $5.80 billion |
| Other Pooled Investment Vehicles | 19 | $4.55 billion | |
| Other Accounts | 38 | $12.23 billion |
| * | Assets are as of May 31, 2022. None of the assets in these accounts are subject to an advisory fee based on performance. |
POTENTIAL MATERIAL CONFLICTS OF INTEREST
Actual or apparent conflicts of interest may arise when a portfolio manager has day-to-day management responsibilities with respect to more than one account. More specifically, portfolio managers who manage multiple accounts are presented a number of potential conflicts, including, among others, those discussed below.
The management of multiple accounts may result in a portfolio manager devoting unequal time and attention to the management of each account. Nuveen Asset Management seeks to manage such competing interests for the time and attention of portfolio managers by having portfolio managers focus on a particular investment discipline. Most accounts managed by a portfolio manager in a particular investment strategy are managed using the same investment models.
If a portfolio manager identifies a limited investment opportunity which may be suitable for more than one account, an account may not be able to take full advantage of that opportunity due to an allocation of filled purchase or sale orders across all eligible accounts. To deal with these situations, Nuveen Asset Management has adopted procedures for allocating limited opportunities across multiple accounts.
With respect to many of its clients’ accounts, Nuveen Asset Management determines which broker to use to execute transaction orders, consistent with its duty to seek best execution of the transaction. However, with respect to certain other accounts, Nuveen Asset Management may be limited by the client with respect to the selection of brokers or may be instructed to direct trades through a particular broker. In these cases, Nuveen Asset Management may place separate, non-simultaneous, transactions for a Fund and other accounts which may temporarily affect the market price of the security or the execution of the transaction, or both, to the detriment of the Fund or the other accounts.
Some clients are subject to different regulations. As a consequence of this difference in regulatory requirements, some clients may not be permitted to engage in all the investment techniques or transactions or to engage in these transactions to the same extent as the other accounts managed by a portfolio manager. Finally, the appearance of a conflict of interest may arise where Nuveen Asset Management has an incentive, such as a performance-based management fee, which relates to the management of some accounts, with respect to which a portfolio manager has day-to-day management responsibilities.
Conflicts of interest may also arise when the Sub-Adviser invests one or more of its client accounts in different or multiple parts of the same issuer’s capital structure, including investments in public versus private securities, debt versus equity, or senior versus junior/subordinated debt, or otherwise where there are different or inconsistent rights or benefits. Decisions or actions such as investing, trading, proxy voting, exercising, waiving or amending rights or covenants, workout activity, or serving on a board, committee or other involvement in governance may result in conflicts of interest between clients holding different securities or investments. Generally, individual portfolio managers will seek to act in a manner that they believe serves the best interest of the accounts they manage. In cases where a portfolio manager or team faces a conflict among its client accounts, it will seek to act in a manner that it believes best reflects its overall fiduciary duty, which may result in relative advantages or disadvantages for particular accounts.
Nuveen Asset Management has adopted certain compliance procedures which are designed to address these types of conflicts common among investment managers. However, there is no guarantee that such procedures will detect each and every situation in which a conflict arises.
ITEM 8(a)(3). FUND MANAGER COMPENSATION
As of the most recently completed fiscal year end, the primary Portfolio Manager’s compensation is as follows:
Portfolio managers are compensated through a combination of base salary and variable components consisting of (i) a cash bonus; (ii) a long-term performance award; and (iii) participation in a profits interest plan.
Base salary. A portfolio manager’s base salary is determined based upon an analysis of the portfolio manager’s general performance, experience and market levels of base pay for such position.
Cash bonus. A portfolio manager is eligible to receive an annual cash bonus that is based on three variables: risk-adjusted investment performance relative to benchmark generally measured over the most recent one, three and five year periods (unless the portfolio manager’s tenure is shorter), ranking versus Morningstar peer funds generally measured over the most recent one, three and five year periods (unless the portfolio manager’s tenure is shorter), and management and peer reviews.
Long-term performance award. A portfolio manager is eligible to receive a long-term performance award that vests after three years. The amount of the award when granted is based on the same factors used in determining the cash bonus. The value of the award at the completion of the three-year vesting period is adjusted based on the risk-adjusted investment performance of Fund(s) managed by the portfolio manager during the vesting period and the performance of the TIAA organization as a whole.
Profits interest plan. Portfolio managers are eligible to receive profits interests in Nuveen Asset Management and its affiliate, Teachers Advisors, LLC, which vest over time and entitle their holders to a percentage of the firms’ annual profits. Profits interests are allocated to each portfolio manager based on such person’s overall contribution to the firms.
There are generally no differences between the methods used to determine compensation with respect to the Funds and the Other Accounts shown in the table above.
ITEM 8(a)(4). OWNERSHIP OF NIQ SECURITIES AS OF MAY 31, 2022
| Name of Portfolio Manager | None |
$1 - $10,000 | $10,001-$50,000 | $50,001-$100,000 | $100,001-$500,000 | $500,001-$1,000,000 | Over $1,000,000 |
| Daniel Close | X |
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s Board implemented after the registrant last provided disclosure in response to this Item.
ITEM 11. CONTROLS AND PROCEDURES.
| (a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
| (b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 13. EXHIBITS.
File the exhibits listed below as part of this Form.
| (a)(3) | Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable. |
| (a)(4) | Change in the registrant’s independent public accountant. Not applicable. |
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) Nuveen Intermediate Duration Quality Municipal Term Fund
By (Signature and Title) /s/ Mark L. Winget
Mark L. Winget
Vice President and Secretary
Date: August 8, 2022
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/ David J. Lamb
David J. Lamb
Chief Administrative Officer
(principal executive officer)
Date: August 8, 2022
By (Signature and Title) /s/ E. Scott Wickerham
E. Scott Wickerham
Vice President and Controller
(principal financial officer)
Date: August 8, 2022
Nuveen Asset Management, LLC
Proxy Voting Policies and Procedures
Effective Date: January 1, 2011, as last amended March 05, 2020
I. General Principles
A. Nuveen Asset Management, LLC (“NAM”) is an investment sub-adviser for certain of the Nuveen Funds (the “Funds”) and investment adviser for institutional and other separately managed accounts (collectively, with the Funds, “Accounts”). As such, Accounts may confer upon NAM complete discretion to vote proxies.1
B. When NAM has proxy voting authority, it is NAM’s duty to vote proxies in the best interests of its clients (which may involve affirmatively deciding that voting the proxies may not be in the best interests of certain clients on certain matters). In voting proxies, NAM also seeks to enhance total investment return for its clients.
C. If NAM contracts with another investment adviser to act as a sub-adviser for an Account, NAM may delegate proxy voting responsibility to the sub-adviser. Where NAM has delegated proxy voting responsibility, the sub-adviser will be responsible for developing and adhering to its own proxy voting policies, subject to oversight by NAM.
D. NAM’s Proxy Voting Committee (“PVC”) provides oversight of NAM’s proxy voting policies and procedures, including (1) providing an administrative framework to facilitate and monitor the exercise of such proxy voting and to fulfill the obligations of reporting and recordkeeping under the federal securities laws; and (2) approving the proxy voting policies and procedures.
II. Policies
The PVC after reviewing and concluding that such policies are reasonably designed to vote proxies in the best interests of clients, has approved and adopted the proxy voting policies (“Policies”) of Institutional Shareholder Services, Inc. (“ISS”), a leading national provider of proxy voting administrative and research services.i As a result, such Policies set forth NAM’s positions on recurring proxy issues and criteria for addressing non-recurring issues. These Policies are reviewed periodically by ISS, and therefore are subject to change. Even though it has adopted the Policies as drafted by ISS, NAM maintains the fiduciary responsibility for all proxy voting decisions.
| 1 | NAM does not vote proxies where a client withholds proxy voting authority, and in certain non-discretionary and model programs NAM votes proxies in accordance with its Policies in effect from time to time. Clients may opt to vote proxies themselves, or to have proxies voted by an independent third party or other named fiduciary or agent, at the client’s cost. i ISS has separate polices for Taft Hartley plans and it is NAM’s policy to apply the Taft Hartley polices to accounts that are Taft Hartley plans and have requested the application of such policies. |
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III. Procedures
A. Supervision of Proxy Voting. Day-to-day administration of proxy voting may be provided internally or by a third-party service provider, depending on client type, subject to the ultimate oversight of the PVC. The PVC shall supervise the relationships with NAM’s proxy voting services, ISS. ISS apprises Nuveen Global Operations (“NGO”) of shareholder meeting dates, and casts the actual proxy votes. ISS also provides research on proxy proposals and voting recommendations. ISS serves as NAM’s proxy voting record keepers and generate reports on how proxies were voted. NGO periodically reviews communications from ISS to determine whether ISS voted the correct amount of proxies, whether the votes were cast in a timely manner, and whether the vote was in accordance with the Policies or NAM’s specific instructions
B. General Avoidance of Conflicts of Interest.
1. NAM believe that most conflicts of interest faced by NAM in voting proxies can be avoided by voting in accordance with the Policies. Examples of such conflicts of interest are as follows:2
a. The issuer or proxy proponent (e.g., a special interest group) is TIAA-CREF, the ultimate principal owner of NAM, or any of its affiliates.
b. The issuer is an entity in which an executive officer of NAM or a spouse or domestic partner of any such executive officer is or was (within the past three years of the proxy vote) an executive officer or director.
c. The issuer is a registered or unregistered fund or other client for which NAM or another affiliated adviser has a material relationship as investment adviser or sub-adviser (e.g., Nuveen Funds and TIAA Funds) or an institutional separate account.
d. Any other circumstances that NAM is aware of where NAM’s duty to serve its clients’ interests, typically referred to as its “duty of loyalty,” could be materially compromised.
2. To further minimize this risk, Compliance will review ISS’ conflict avoidance policy at least annually to ensure that it adequately addresses both the actual and perceived conflicts of interest ISS may face.
| 2 |
A conflict of interest shall not be considered material for the purposes of these Policies and Procedures with respect to a specific vote or circumstance if the matter to be voted on relates to a restructuring of the terms of existing securities or the issuance of new securities or a similar matter arising out of the holding of securities, other than common equity, in the context of a bankruptcy or threatened bankruptcy of the issuer. |
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3. In the event that ISS faces a material conflict of interest with respect to a specific vote, the PVC shall direct ISS how to vote. The PVC shall receive voting direction from appropriate investment personnel. Before doing so, the PVC will consult with Legal to confirm that NAM faces no material conflicts of its own with respect to the specific proxy vote.
4. Where ISS is determined to have a conflict of interest, or NAM determines to override the Policies and is determined to have a conflict, the PVC will recommend to NAM’s Compliance Committee or designee a course of action designed to address the conflict. Such actions could include, but are not limited to:
a. Obtaining instructions from the affected client(s) on how to vote the proxy;
b. Disclosing the conflict to the affected client(s) and seeking their consent to permit NAM to vote the proxy;
c. Voting in proportion to the other shareholders;
e. Recusing the individual with the actual or potential conflict of interest from all discussion or consideration of the matter, if the material conflict is due to such person’s actual or potential conflict of interest; or
f. Following the recommendation of a different independent third party.
5. In addition to all of the above-mentioned and other conflicts, the Head of Equity Research, NGO and any member of the PVC must notify NAM’s Chief Compliance Officer (“CCO”) of any direct, indirect or perceived improper influence exerted by any employee, officer or director of TIAA or its subsidiaries with regard to how NAM should vote proxies. NAM Compliance will investigate any such allegations and will report the findings to the PVC and, if deemed appropriate, to NAM’s Compliance Committee. If it is determined that improper influence was attempted, appropriate action shall be taken. Such appropriate action may include disciplinary action, notification of the appropriate senior managers, or notification of the appropriate regulatory authorities. In all cases, NAM will not consider any improper influence in determining how to vote proxies, and will vote in the best interests of clients.
C. Proxy Vote Override. From time to time, a portfolio manager of an account (a “Portfolio Manager”) may initiate action to override the Policies’ recommendation for a particular vote. Any such override by a NAM Portfolio Manager (but not a sub-adviser Portfolio Manager)
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shall be reviewed by NAM’s Legal Department for material conflicts. If the Legal Department determines that no material conflicts exist, the approval of one member of the PVC shall authorize the override. If a material conflict exists, the conflict and, ultimately, the override recommendation will be rejected and will revert to the original Policies recommendation or will be addressed pursuant to the procedures described above under “Conflicts of Interest.”
In addition, the PVC may determine from time to time that a particular recommendation in the Policies should be overridden based on a determination that the recommendation is inappropriate and not in the best interests of shareholders. Any such determination shall be reflected in the minutes of a meeting of the PVC at which such decision is made.
D. Securities Lending.
1. In order to generate incremental revenue, some clients may participate in a securities lending program. If a client has elected to participate in the lending program then it will not have the right to vote the proxies of any securities that are on loan as of the shareholder meeting record date. A client, or a Portfolio Manager, may place restrictions on loaning securities and/or recall a security on loan at any time. Such actions must be affected prior to the record date for a meeting if the purpose for the restriction or recall is to secure the vote.
2. Portfolio Managers and/or analysts who become aware of upcoming proxy issues relating to any securities in portfolios they manage, or issuers they follow, will consider the desirability of recalling the affected securities that are on loan or restricting the affected securities prior to the record date for the matter. If the proxy issue is determined to be material, and the determination is made prior to the shareholder meeting record date the Portfolio Manager(s) will contact the Securities Lending Agent to recall securities on loan or restrict the loaning of any security held in any portfolio they manage, if they determine that it is in the best interest of shareholders to do so.
E. Proxy Voting Records. As required by Rule 204-2 of the Investment Advisers Act of 1940, NAM shall make and retain five types of records relating to proxy voting; (1) NAM’s Policies; (2) proxy statements received for securities in client accounts; (3) records of proxy votes cast by NAM on behalf of clients accounts; (4) records of written requests from clients about how NAM voted their proxies, and written responses from NAM to either a written or oral request by clients; and (5) any documents prepared by the adviser that were material to making a proxy voting decision or that memorialized the basis for the decision. NAM relies on ISS to make and retain on NAM’s behalf certain records pertaining to Rule 204-2.
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F. Fund of Funds Provision. In instances where NAM provides investment advice to a fund of funds that acquires shares of affiliated funds or three percent or more of the outstanding voting securities of an unaffiliated fund, the acquiring fund shall vote the shares in the same proportion as the vote of all other shareholders of the acquired fund. If compliance with this procedure results in a vote of any shares in a manner different than the Policies’ recommendation, such vote will not require compliance with the Proxy Vote Override procedures set forth above.
G. Legacy Securities. To the extent that NAM receives proxies for securities that are transferred into an account’s portfolio that were not recommended or selected by it and are sold or expected to be sold promptly in an orderly manner (“legacy securities”), NAM will generally refrain from voting such proxies. In such circumstances, since legacy securities are expected to be sold promptly, voting proxies on such securities would not further NAM’s interest in maximizing the value of client investments. NAM may agree to an account’s special request to vote a legacy security proxy, and would vote such proxy in accordance with the Policies.
H. Terminated Accounts. Proxies received after the termination date of an account generally will not be voted. An exception will be made if the record date is for a period in which an account was under NAM’s discretionary management or if a separately managed account (“SMA”) custodian failed to remove the account’s holdings from its aggregated voting list.
I. Non-votes. NGO shall be responsible for obtaining reasonable assurance from ISS that it voted proxies on NAM’s behalf, and that any special instructions from NAM about a given proxy or proxies are submitted to ISS in a timely manner. It should not be considered a breach of this responsibility if NGO or NAM does not receive a proxy from ISS or a custodian with adequate time to analyze and direct to vote or vote a proxy by the required voting deadline.
NAM may determine not to vote proxies associated with the securities of any issuer if as a result of voting such proxies, subsequent purchases or sales of such securities would be blocked. However, NAM may decide, on an individual security basis that it is in the best interests of its clients to vote the proxy associated with such a security, taking into account the loss of liquidity. In addition, NAM may determine not to vote proxies where the voting would in NAM’s judgment result in some other financial, legal, regulatory disability or burden to the client (such as imputing control with respect to the issuer) or to NAM or its affiliates.
NAM may determine not to vote securities held by SMAs where voting would require the transfer of the security to another custodian designated by the issuer. Such transfer is generally outside the scope of NAM’s authority and may result in significant operational limitations on NAM’s ability to conduct transactions relating to the securities during the period of transfer. From time to time, situations may arise (operational or otherwise) that prevent NAM from voting proxies after reasonable attempts have been made.
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J. Review and Reports.
1. The PVC shall maintain a review schedule. The schedule shall include reviews of the Policies and the policies of any Sub-adviser engaged by NAM, the proxy voting record, account maintenance, and other reviews as deemed appropriate by the PVC. The PVC shall review the schedule at least annually.
2. The PVC will report to NAM’s Compliance Committee with respect to all identified conflicts and how they were addressed. These reports will include all accounts, including those that are sub-advised. NAM also shall provide the Funds that it sub-advises with information necessary for preparing Form N-PX.
K. Vote Disclosure to Clients. NAM’s institutional and SMA clients can contact their relationship manager for more information on NAM’s Policies and the proxy voting record for their account. The information available includes name of issuer, ticker/CUSIP, shareholder meeting date, description of item and NAM’s vote.
IV. Responsible Parties
PVC
NGO
NAM Compliance
Legal Department
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Exhibit 99.CERT
CERTIFICATION
I, David J. Lamb, certify that:
| 1. | I have reviewed this report on Form N-CSR of Nuveen Intermediate Duration Quality Municipal Term Fund; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
| (a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
| (d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
| (b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: August 8, 2022
/s/ David J. Lamb
David J. Lamb
Chief Administrative Officer
(principal executive officer)
CERTIFICATION
I, E. Scott Wickerham, certify that:
| 1. | I have reviewed this report on Form N-CSR of Nuveen Intermediate Duration Quality Municipal Term Fund; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
| (a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and |
| (d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
| (b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: August 8, 2022
/s/ E. Scott Wickerham
E. Scott Wickerham
Vice President and Controller
(principal financial officer)
Exhibit 99.906CERT
Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002; provided by the Chief Executive Officer and Chief Financial Officer, based on each such officer’s knowledge and belief.
The undersigned officers of Nuveen Intermediate Duration Quality Municipal Term Fund (the “Fund”) certify that, to the best of each such officer’s knowledge and belief:
| 1. | The Form N-CSR of the Fund for the period ended May 31, 2022 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. |
Date: August 8, 2022
/s/ David J. Lamb
David J. Lamb
Chief Administrative Officer
(principal executive officer)
/s/ E. Scott Wickerham
E. Scott Wickerham
Vice President, Controller
(principal financial officer)
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