Company: NPFD
Filing Date: 2025-10-03
Form Type: N-CSR
Source: 0001193125-25-230111
Chunk: 80

Company: Nuveen Variable Rate Preferred & Income Fund
Filing Date: 2025-10-03
Form: N-CSR
Chunk 80
---
’s debt, including both senior and subordinated debt. Because of their subordinated position in the capital structure of an
issuer, the ability to defer dividend or interest payments for extended periods of time without triggering a default from legal action and certain other features, preferred securities are often treated as equity-like instruments by both issuers and
investors, as their quality and value are heavily dependent on the profitability and cash flows of the issuer rather than on any legal claims to specific assets.

The Fund may invest in contingent capital securities (sometimes referred to as “CoCos”). CoCos are hybrid securities, issued primarily by non-U.S.
financial institutions, which have loss absorption mechanisms benefitting the issuer built into their terms. CoCos generally provide for mandatory conversion into the common stock of the issuer or a write-down of the principal amount or value of the
CoCos upon the occurrence of certain triggers linked to regulatory capital thresholds. In addition, they may provide for mandatory conversion or a principal write-down upon the occurrence of certain events such as regulatory actions calling into
question the issuing banking institution’s continued viability as a going-concern. Equity conversion or principal write-down features are tailored to the issuer and its regulatory requirements and, unlike traditional convertible securities,
conversions are not voluntary.

109

Shareholder Update(continued)

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 invest in payment-in-kind securities (“PIKs”). PIKs pay dividends or interest in the form of additional securities of the issuer, rather than in cash. Each of these instruments is typically issued and
traded at a deep discount from its face amount. The amount of the discount varies depending on such factors as the time remaining until maturity of the securities, prevailing interest rates, the liquidity of the security and the perceived credit
quality of the issuer.

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 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 “193