A word about risk: Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and low interest rate environments increase this risk. Reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original cost when redeemed. Mortgage and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and their value may fluctuate in response to the market’s perception of issuer creditworthiness; while generally supported by some form of government or private guarantee there is no assurance that private guarantors will meet their obligations. Investing in foreign-denominated and/or -domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. Corporate debt securities are subject to the risk of the issuer’s inability to meet principal and interest payments on the obligation and may also be subject to price volatility due to factors such as interest rate sensitivity, market perception of the creditworthiness of the issuer and general market liquidity. Collateralized Loan Obligations (CLOs) may involve a high degree of risk and are intended for sale to qualified investors only. Investors may lose some or all of the investment and there may be periods where no cash flow distributions are received. CLOs are exposed to risks such as credit, default, liquidity, management, volatility, interest rate and credit risk. High-yield, lower-rated, securities involve greater risk than higher-rated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that do not. REITs are subject to risk, such as poor performance by the manager, adverse changes to tax laws or failure to qualify for tax-free pass-through of income. Residential or commercial mortgage loans and commercial real estate debt are subject to risks that include prepayment, delinquency, foreclosure, risks of loss, servicing risks and adverse regulatory developments, which risks may be heightened in the case of non-performing loans. Investing in distressed loans and bankrupt companies is speculative and the repayment of default obligations contains significant uncertainties. Distressed and Defaulted Securities involve substantial risks, including the risk of default. Such investments may be in default at the time of investment. In addition, these securities may fluctuate more in price, and are typically less liquid. Commodities contain heightened risk, including market, political, regulatory and natural conditions, and may not be appropriate for all investors. Many energy sector MLPs and other companies in which the fund may invest operate natural gas, natural gas liquids, crude oil, refined products, coal, or other facilities within the energy sector and will be susceptible to adverse economic, environmental, or regulatory occurrences affecting the sector including sharp decreases in crude oil or natural gas prices. Private credit involves an investment in non-publicly traded securities which may be subject to illiquidity risk. Portfolios that invest in private credit may be leveraged and may engage in speculative investment practices that increase the risk of investment loss. Leveraging transactions, including borrowing, typically will cause a portfolio to be more volatile than if the portfolio had not been leveraged. Leveraging transactions typically involve expenses, which could exceed the rate of return on investments purchased by a fund with such leverage and reduce fund returns. The use of leverage may cause a portfolio to liquidate positions when it may not be advantageous to do so. Leveraging transactions may increase a fund’s duration and sensitivity to interest rate movements. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested.
Limited Term Risk. Unless the limited term provision of the fund’s Declaration of Trust is amended by shareholders in accordance with the Declaration of Trust, or unless the fund completes a tender offer, as of a date within twelve months preceding the Dissolution Date (as defined below), to all common shareholders to purchase 100% of the then outstanding common shares of the fund at a price equal to the NAV per common share on the expiration date of the tender offer (an “Eligible Tender Offer”), and converts to perpetual existence, the fund will terminate on or about January 29, 2031 (the “Dissolution Date”). The fund is not a “target term” fund whose investment objective is to return its original net asset value on the Dissolution Date or in an Eligible Tender Offer. Because the assets of the fund will be liquidated in connection with the dissolution, the fund will incur transaction costs in connection with dispositions of portfolio securities. The fund does not limit its investments to securities having a maturity date prior to the Dissolution Date and 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. In particular, the fund’s portfolio may still have large exposures to illiquid securities as the Dissolution Date approaches, and losses due to portfolio liquidation may be significant. Beginning one year before the Dissolution Date (the “Wind-Down Period”) the fund may begin liquidating all or a portion of the fund’s portfolio, and the fund may deviate from its investment strategy and may not achieve its investment objectives. As a result, during the Wind-Down Period, the fund’s distributions may decrease, and such distributions may include a return of capital. The fund’s investment objectives and policies are not designed to seek to return investors’ original investment upon termination of the fund, and investors may receive more or less than their original investment upon termination of the fund. As 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.