DEFC14A: Nuveen Variable Rate Preferred & Income Fund Faces Proxy Contest from Saba Capital at Upcoming Annual Meeting

Nuveen Variable Rate Preferred & Income Fund is holding its annual shareholder meeting on May 15, 2024, amidst a proxy contest initiated by Saba Capital Management, urging shareholders to vote using the WHITE proxy card endorsed by the Board.

Summary

• Nuveen Variable Rate Preferred & Income Fund (NPFD) will hold its Annual Meeting of Shareholders on May 15, 2024, in Chicago.
• Shareholders of record as of January 19, 2024, are entitled to vote.
• The meeting includes the election of three Class III Trustees by common and preferred shareholders voting together, and two Trustees by preferred shareholders voting separately.
• The board recommends voting for its nominees for Class III Trustees (Joanne T. Medero, Loren M. Starr, and Matthew Thornton III) and for Trustees elected by preferred shareholders only (Albin F. Moschner and Margaret L. Wolff).
• The board does not endorse the nominee proposed by Saba Capital Master Fund, Ltd.
• The meeting will also include a vote to ratify the selection of KPMG LLP as the fund's independent registered public accounting firm for the fiscal year ending July 31, 2024.
• The board unanimously recommends voting FOR the ratification of KPMG.
• The fund is urging shareholders to use the WHITE proxy card and disregard any proxy cards received from Saba.
• Returning a proxy card from Saba will disenfranchise the shareholder's ability to elect a full slate of trustees.
• As of January 19, 2024, there were 24,164,141 common shares and 85,000 preferred shares outstanding.

Sentiment

Score: 6

Explanation: The document is primarily informational, outlining the proposals for the annual meeting and the Board's recommendations. The presence of a proxy contest introduces a slightly negative element, but the overall tone remains neutral and professional.

Positives

• The Board has nominated experienced and skilled individuals for the Trustee positions.
• The Board Consolidation is expected to generate cost efficiencies, expense savings and economies of scale.
• The Board believes the unitary board structure enhances good and effective governance.
• The Board is focused on creating sustainable value for Fund shareholders.

Negatives

• Saba Capital Management is conducting a proxy contest, which can be disruptive and costly.
• The Board does not endorse the Hedge Fund Nominee, suggesting potential misalignment of interests.
• Returning a proxy card from Saba will disenfranchise the shareholder's ability to elect a full slate of trustees.

Risks

• The proxy contest initiated by Saba Capital Management could lead to changes in the Board's composition and potentially alter the Fund's strategies.
• Failure to achieve a quorum at the Annual Meeting could necessitate adjournment and result in additional expenses.
• The Board believes that the Hedge Fund Nominee may seek to advance the short-term goals of the Saba Hedge Fund rather than the long-term interests of all Fund shareholders.

Future Outlook

The document outlines the matters to be voted on at the Annual Meeting and emphasizes the importance of shareholder participation in light of the proxy contest.

Management Comments

• The Board urges you to review the proposals in the accompanying proxy statement and vote as recommended by the Board using the enclosed WHITE proxy card.
• The Board does NOT endorse the Hedge Fund Nominee.
• The Board urges you NOT to sign or return any proxy card sent to you by Saba.
• The Board unanimously recommends that you vote on the enclosed WHITE proxy card as follows: 1(a): FOR the election of the Boards nominees for election as Class III Trustees; 1(b): FOR the election of the Boards nominees for election as Trustees elected by the holders of preferred shares only (if you are a holder of preferred shares); and 2: FOR the ratification of the selection of the Funds independent registered public accounting firm.

Industry Context

Proxy contests are not uncommon in the investment management industry, particularly with closed-end funds, as activist investors seek to influence fund strategies and governance.

Comparison to Industry Standards

• The document mentions Rule 452 of the NYSE, which governs how brokers can vote shares held in street name when they haven't received instructions from the beneficial owners.
• The document mentions Public Company Accounting Oversight Board Rule 3526 (Communications with Audit Committees Concerning Independence), and the Audit Committee discussed with representatives of the independent registered public accounting firm their firms independence.
• The document mentions Statement on Auditing Standards (SAS) No. 114 (The Auditors Communication With Those Charged With Governance), which supersedes SAS No. 61 (Communication with Audit Committees).

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders are directly impacted by the outcome of the proxy vote, which will determine the composition of the Board and the ratification of the independent auditor.
• The Board's decisions and strategies will ultimately affect the Fund's performance and returns for shareholders.

Next Steps

• Shareholders need to review the proxy statement and vote on the proposals.
• The Fund will hold its Annual Meeting on May 15, 2024.
• The Board will continue to engage with shareholders regarding the proxy contest.

Key Dates

Keywords

proxy contest, annual meeting, trustees, Saba Capital, Nuveen, shareholders, NPFD, proxy statement, election, board