Jere,

The 40th was in or near Knoxville TN. in June of 1862. Checking the records of other members of the 40th I found that some of them died of disease ( Measles ), in June 1862.

I saw one man that died in June who's body was shiped home.
That may be what happened to Nathan Nichols or he may be buried the in Knoxville TN. area.

There was a fight at Chattanooga TN. June 6th 1862, but I don't think the 40th was there.

I hope this will help,
Gary D. Bray