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 811-6383
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Nuveen Michigan Quality Income Municipal Fund, Inc.
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Kevin J. McCarthy
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: February 28
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Date of reporting period: February 28, 2010
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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.
[LOGO]
NUVEEN
INVESTMENT
Closed-End Funds
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Nuveen Investments
Municipal Closed-End Funds
IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R)
Annual Report
February 28, 2010
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------------------------- ------------------------- ------------------------ --------------------------
NUVEEN MICHIGAN NUVEEN MICHIGAN NUVEEN MICHIGAN NUVEEN OHIO
QUALITY INCOME PREMIUM INCOME DIVIDEND ADVANTAGE QUALITY INCOME
MUNICIPAL FUND, INC. MUNICIPAL FUND, INC. MUNICIPAL FUND MUNICIPAL FUND, INC.
NUM NMP NZW NUO
------------------------- ------------------------- ------------------------
NUVEEN OHIO NUVEEN OHIO NUVEEN OHIO
DIVIDEND ADVANTAGE DIVIDEND ADVANTAGE DIVIDEND ADVANTAGE
MUNICIPAL FUND MUNICIPAL FUND 2 MUNICIPAL FUND 3
NXI NBJ NVJ
FEBRUARY
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NUVEEN
INVESTMENTS
Chairman's
Letter to Shareholders
[PHOTO OF ROBERT P. BREMNER]
DEAR SHAREHOLDER,
The economic environment in which your Fund operates reflects continuing but
uneven economic recovery. The U.S. and other major industrial countries are
experiencing steady but comparatively low levels of economic growth, while
emerging market countries are seeing a resumption of relatively strong economic
expansion. The largest source of economic uncertainty is the potential impact of
steps being considered by many governments to counteract the extraordinary
governmental spending and credit expansion carried out to deal with the
financial and economic crisis of 2008. Consequently, the implications for future
tax rates, government spending, interest rates and the pace of economic recovery
in the U.S. and other leading economies are extremely difficult to predict at
the present time. The long term health of the global economy depends on
restoring some measure of fiscal discipline around the world, but since all of
the corrective steps require economic pain, it is not surprising that
governments are reluctant to undertake them.
In the near term, governments remain committed to furthering economic recovery
and realizing a meaningful reduction in their national unemployment rates. Such
an environment should produce continued economic growth and, consequently,
attractive investment opportunities. Over the longer term, the larger
uncertainty mentioned earlier carries the risk of unexpected potholes in the
road to sustained recovery. For this reason, Nuveen's investment management
teams are working hard to balance return and risk by building well-diversified
portfolios, among other strategies. I encourage you to read the following
commentary on the management of your Fund. As always, I also encourage you to
contact your financial consultant if you have any questions about your Nuveen
Fund investment.
Over the last twelve months, the Nuveen leveraged municipal closed-end funds
continued to make progress in refinancing their auction rate preferred shares
(ARPS). By the fall of 2009, all of the Nuveen taxable closed-end Funds had
completed redemption of their ARPS at par value. As of March 31, 2010,
approximately 40% of the municipal ARPS issued by the Nuveen Funds also had been
redeemed. Please consult the Nuveen web site for the most recent information on
this issue and all recent developments on your Nuveen Funds at: www.nuveen.com.
On behalf of the other members of your Fund's Board, we look forward to
continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Robert P. Bremner
Robert P. Bremner
Chairman of the Board and Lead Independent Director
April 19, 2010
Nuveen Investments 1
Portfolio Manager's Comments
Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM)
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP)
Nuveen Michigan Dividend Advantage Municipal Fund (NZW)
Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO)
Nuveen Ohio Dividend Advantage Municipal Fund (NXI)
Nuveen Ohio Dividend Advantage Municipal Fund 2 (NBJ)
Nuveen Ohio Dividend Advantage Municipal Fund 3 (NVJ)
PORTFOLIO MANAGER DANIEL CLOSE DISCUSSES ECONOMIC AND MUNICIPAL MARKET
CONDITIONS AT BOTH THE NATIONAL AND STATE LEVELS, KEY INVESTMENT STRATEGIES, AND
THE TWELVE-MONTH PERFORMANCE OF THE NUVEEN MICHIGAN AND OHIO FUNDS. DAN, WHO
JOINED NUVEEN IN 2000, ASSUMED PORTFOLIO MANAGEMENT RESPONSIBILITY FOR THESE
SEVEN FUNDS IN 2007.
WHAT FACTORS AFFECTED THE U.S. ECONOMIC AND MUNICIPAL MARKET ENVIRONMENTS DURING
THE TWELVE-MONTH REPORTING PERIOD ENDED FEBRUARY 28, 2010?
During this reporting period, municipal bond prices generally rose as strong
cash flows into municipal bond funds combined with tighter supply of new
tax-exempt issuance to provide favorable supply and demand conditions. As the
period began, there continued to be considerable downward pressure on the
economy, and both the Federal Reserve (Fed) and the federal government continued
their efforts to improve overall economic conditions. The Fed kept the benchmark
fed funds rate in a target range of zero to 0.25% after cutting it to its record
low level in December 2008. In February 2009, the federal government passed a
$787 billion economic stimulus package. At its meeting in March 2010 (after the
close of this reporting period), the Fed pledged to keep the fed funds rate
"exceptionally low" for an "extended period."
In recent months, these and other measures taken by the Fed and the government
to ease the economic recession have produced some incipient signs of
improvement. In the fourth quarter of 2009, the U.S. gross domestic product
(GDP) grew at an annualized rate of 5.6%, the fastest pace in six years. This
was the second quarter in a row that the economy posted positive growth,
following four quarters of contraction. Housing prices also provided a bright
spot between May 2009 and January 2010 by recording nine consecutive months of
positive returns (on a seasonally adjusted basis) after three years of decline.
At the same time, inflation remained relatively tame, as the Consumer Price
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 MANAGER 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.
2 Nuveen Investments
Index (CPI) rose 2.1%. The core CPI (which excludes food and energy) rose 1.3%
over the year, within the Fed's unofficial objective of 2.0% or lower for this
measure. Since the recession began in December 2007, the U.S. economy has lost a
total of 8.4 million jobs, the biggest decline since the Great Depression. While
labor markets remained weak, recent months saw a slight improvement. As of
February 2010, the national unemployment rate was 9.7%, up from 8.2% in February
2009 but down from the 26-year high of 10.1% in October 2009.
Municipal market conditions began to show general signs of improvement
throughout most of the period. This trend was bolstered by the reduced supply of
tax-exempt municipal debt in the marketplace, due in part to the introduction of
the Build America Bond program in April 2009. Build America Bonds are a new
class of taxable municipal debt created as part of the February 2009 economic
stimulus package. These bonds currently offer municipal issuers a federal
subsidy equal to 35% of the security's interest payments and therefore provide
issuers with an attractive alternative to traditional tax-exempt debt. Between
April 2009 and the end of this reporting period, taxable Build America Bonds
issuance totaled $78.2 billion, accounting for 20% of new bonds issued in the
municipal market during that time. Over the twelve months ended February 28,
2010, municipal bond issuance nationwide--both tax-exempt and taxable--totaled
$423.1 billion, an increase of 7.3% compared with the twelve-month period ended
February 28, 2009. Demand for tax-exempt bonds remained strong during this
period and, combined with lower tax-exempt supply, provided support for
municipal bond prices.
HOW WERE THE ECONOMIC AND MARKET ENVIRONMENTS IN MICHIGAN AND OHIO DURING THIS
PERIOD?
Despite slight improvements in selected areas over the past twelve months,
Michigan's state economy continued to rank as one of the weakest in the country.
Michigan's unemployment rate remained the nation's highest, as employment
declined across all sectors except education and health services. Construction,
manufacturing, professional and business services, and information services all
registered double-digit job losses. As of February 2010, Michigan's jobless rate
was 14.1%, up from 12.0% in February 2009. In addition to employment concerns,
Michigan continued to experience declining home values and a high foreclosure
rate, which in turn impacted consumer spending, property taxes, and state and
local revenues. According to the Standard & Poor's (S&P)/Case-Shiller home price
index of 20 major metropolitan areas, housing prices in Detroit fell 7.4% during
the twelve months ended January 2010, compared with a drop of 21.7% for the
twelve months ended January 2009. As of February 2010, Moody's, S&P and Fitch
rated Michigan general obligation (GO) debt at Aa3, AA-, and A+, respectively.
These
Nuveen Investments 3
ratings reflected Fitch's downgrade of Michigan GOs to A+ from AA- in July 2009.
All three rating agencies carried a stable outlook for Michigan GOs. During the
twelve months ended February 28, 2010, municipal issuance in Michigan totaled
$6.3 billion, a decrease of 31% compared with the twelve months ended February
2009.
Ohio continued to rank in the bottom tier of states in terms of economic growth,
with an economy that has contracted since 2006. However, tentative signs suggest
that this trend may be easing to some degree. The housing outlook for the state
has generally improved, as the downturn in home values moderated in recent
months. According to the S&P/Case-Shiller home price index of 20 major
metropolitan areas, housing prices in Cleveland rose 0.2% during the twelve
months ended January 2010, compared with an average decline of 0.7% nationally.
Like Michigan, employment in Ohio remained less diversified than that of the
nation as a whole, with heavier dependence on the manufacturing sector than seen
nationally. As of February 2010, Ohio's unemployment rate was 10.9%, the highest
since September 1983, up from 9.1% in February 2009. While Ohio is relying on
service industries to provide some growth, those industries have been hampered
by slowing population trends. Since 2005, net outmigration from the state has
topped 30,000 each year. As of February 2010, Moody's, S&P and Fitch rated Ohio
general obligation debt at Aa2, AA+, and AA, respectively. These ratings
reflected the June 2009 downgrades to Aa2 from Aa1 by Moody's and to AA from AA+
by Fitch. Moody's listed the outlook for Ohio GOs as stable, while S&P and Fitch
revised their outlooks to negative as of September 2009 and June 2009,
respectively. For the twelve months ended February 28, 2010, municipal issuance
in Ohio totaled $12.3 billion, an increase of approximately 2% compared with the
twelve months ended February 2008.
WHAT KEY STRATEGIES WERE USED TO MANAGE THE MICHIGAN AND OHIO FUNDS DURING THIS
REPORTING PERIOD?
As previously mentioned, the availability of new tax-exempt supply declined
during this period, due in part to the introduction of taxable Build America
Bonds in April 2009. During the twelve months ended February 28, 2010, Build
America Bonds comprised approximately 19% of new municipal supply in Ohio, which
ranked as the seventh largest user of these bonds among the 50 states. In
Michigan, where municipal issuance was already down 31% from the same period a
year earlier, Build America Bonds represented more than 22% of new municipal
supply for the period. Since interest payments from Build America Bonds
represent taxable income, we do not view these bonds as good investment
opportunities for the tax-exempt Michigan and Ohio Funds.
4 Nuveen Investments
Given the constrained supply of new tax-exempt municipal bonds in the primary
market, we turned to the secondary market to find attractive value
opportunities. We continued to take a bottoms-up approach to discovering
undervalued sectors and individual credits with the potential to perform well
over the long term. During this period, all three of the Michigan Funds
purchased uninsured health care bonds as well as general obligation credits
representing issuers in the southeast Michigan corridor. Although we had
previously de-emphasized bonds issued in this area of Michigan due to the
region's economic problems, we believed that, on a risk-adjusted basis, these
bonds now offered good value. For this reason, we selectively added these
credits in sizable amounts for the first time in a long while.
In all four of the Ohio Funds, we purchased uninsured health care bonds.
Tax-exempt supply was usually more plentiful in the health care sector because
hospitals generally do not qualify for the Build America Bond program and so
must continue to issue bonds in the tax-exempt municipal market. NXI, NBJ and
NVJ also added an additional dedicated tax bond issued for the Delaware County
library as well as industrial development bonds.
Cash for new purchases during this period was generated largely by maturing or
called bonds. In addition, the Michigan Funds took advantage of opportunities to
sell several issues where we had credit concerns, including bonds issued for a
continuing care retirement center, health care facilities and charter schools.
In the Ohio Funds, we also sold a health care issue due to deteriorating credit.
All of these Funds continued to use inverse floating rate securities.(1) We
employ inverse floaters as a form of leverage for a variety of reasons,
including duration(2) management, income enhancement and total return
enhancement.
(1) An inverse floating rate security, also known as an inverse floater, is a
financial instrument designed to pay long-term tax-exempt interest at a
rate that varies inversely with a short-term tax-exempt interest rate
index. For the Nuveen Funds, the index typically used is the Securities
Industry and Financial Markets (SIFM) Municipal Swap Index (previously
referred to as the Bond Market Association Index or BMA). Inverse
floaters, including those inverse floating rate securities in which the
Funds invested during this reporting period, are further defined within
the Notes to Financial Statements and Glossary of Terms Used in this
Report sections of this report.
(2) Duration is a measure of a bond's price sensitivity as interest rates
change, with longer duration bonds displaying more sensitivity to these
changes than bonds with shorter durations.
Nuveen Investments 5
HOW DID THE FUNDS PERFORM?
Individual results for these Nuveen Michigan and Ohio Funds, as well as relevant
index and peer group information, are presented in the accompanying table.
AVERAGE ANNUAL TOTAL RETURNS ON COMMON SHARE NET ASSET VALUE
FOR PERIODS ENDED 2/28/10
1-YEAR 5-YEAR 10-YEAR
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MICHIGAN FUNDS
NUM 14.83% 3.98% 6.60%
NMP 14.22% 3.86% 6.59%
NZW 17.70% 3.82% N/A
Standard & Poor's (S&P) Michigan Municipal Bond Index(3) 11.94% 4.01% 5.69%
Standard & Poor's (S&P) National Municipal Bond Index(4) 11.20% 4.32% 5.77%
Lipper Michigan Municipal Debt Funds Average(5) 17.17% 3.51% 6.90%
OHIO FUNDS
NUO 16.76% 4.58% 6.46%
NXI 15.46% 4.84% N/A
NBJ 18.91% 4.44% N/A
NVJ 15.73% 4.95% N/A
Standard & Poor's (S&P) Ohio Municipal Bond Index(3) 14.79% 3.89% 5.48%
Standard & Poor's (S&P) National Municipal Bond Index(4) 11.20% 4.32% 5.77%
Lipper Other States Municipal Debt Funds Average(5) 19.01% 4.11% 6.62%
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For the twelve months ended February 28, 2010, the total returns on common share
net asset value (NAV) for all of the Michigan Funds exceeded the return for the
Standard & Poor's (S&P) Michigan Municipal Bond Index, all of the Ohio Funds
outperformed the S&P Ohio Municipal Bond Index, and all seven Funds surpassed
the return on the S&P National Municipal Bond Index. NZW outperformed the
average return for the Lipper Michigan Municipal Debt Funds Average, while NUM
and NMP trailed this measure. Among the Ohio Funds, NBJ performed in line with
the Lipper Other States Municipal Debt Funds Average and NUO, NXI and NVJ lagged
the group average. Shareholders should note that the performance of the Lipper
Other States Municipal Debt Funds Average represents the overall average of
returns for funds from ten different states with a wide variety of municipal
market conditions.
Key management factors that influenced the Funds' returns during this period
included yield curve and duration positioning, credit exposure and sector
allocation. In addition, leverage was an important positive factor affecting the
Funds' performances over this period. The impact of leverage is discussed in
more detail on page seven.
During this period, yields on tax-exempt bonds generally declined and bond
prices rose, especially at the longer end of the municipal yield curve. As a
result, longer-term bonds generally outperformed credits with shorter
maturities. Overall, duration and yield curve positioning proved positive for
the performances of these Funds, with the exception of NVJ. In general, the
Funds were underexposed to the underperforming
Past performance is not predictive of 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.
For additional information, see the individual Performance Overview for
your Fund in this report.
(3) The Standard & Poor's (S&P) Michigan and Ohio Municipal Bond Indexes are
unlever-aged, market value-weighted indexes designed to measure the
performance of the investment-grade municipal bond markets in Michigan and
Ohio, respectively. These indexes do not reflect any initial or ongoing
expenses and are not available for direct investment.
(4) The Standard & Poor's (S&P) National Municipal Bond Index is an
unleveraged, market value-weighted index designed to measure the
performance of the investment-grade U.S. municipal bond market. This index
does not reflect any initial or ongoing expenses and is not available for
direct investment.
(5) The Lipper Michigan Municipal Debt Funds Average is calculated using the
returns of all closed-end funds in this category for each period as
follows: 1-year, 4 funds; 5-year, 4 funds; and 10-year, 3 funds. Lipper
returns account for the effects of management fees and assume reinvestment
of dividends, but do not reflect any applicable sales charges. The Lipper
average is not available for direct investment.
(6) The Lipper Other States Municipal Debt Funds Average is calculated using
the returns of all closed-end funds in this category for each period as
follows: 1-year, 43 funds; 5-year, 43 funds; and 10-year, 20 funds. The
performance of the Lipper Other States category represents the overall
average of returns for funds from ten different states with a wide variety
of municipal market conditions. Lipper returns account for the effects of
management fees and assume reinvestment of dividends, but do not reflect
any applicable sales charges. The Lipper average is not available for
direct investment.
6 Nuveen Investments
short end of the yield curve and had heavier weightings in the longer part of
the curve, which had a positive impact on performance.
While duration and yield curve positioning played an important role in
performance during this twelve-month period, credit exposure also had a
significant impact. The demand for municipal bonds increased during this period,
driven by a variety of factors, including concerns about potential tax
increases, the need to rebalance portfolio allocations and a growing appetite
for additional risk. At the same time, the supply of new tax-exempt municipal
securities declined. As investors bid up municipal bond prices, bonds rated BBB
or below and non-rated bonds generally outperformed those rated AAA. In this
environment, the Funds' performances benefited from their allocations of lower
quality credits. Given their underweightings in BBB and non-rated bonds, the
Michigan Funds were more constrained in their opportunities to take advantage of
this environment. However, as a Dividend Advantage Fund, NZW had a heavier
weighting to sub-investment-grade bonds, which boosted its performance for the
twelve months.
Holdings that generally contributed positively to the Fund's performance
included industrial development revenue (IDR) and health care bonds. While the
three Michigan Funds were underweighted in health care, all four Ohio Fund
benefited from overweightings in this sector. Revenue bonds as a whole performed
well, with housing, transportation and public utilities among the sectors also
outperforming the general municipal market for this period. In addition, zero
coupon bonds and lower-rated tobacco bonds were among the strongest performers.
Pre-refunded bonds, which are typically backed by U.S. Treasury securities,
performed especially poorly on a relative basis during this period. The
underperformance of these bonds can be attributed primarily to their shorter
effective maturities and higher credit quality. The Michigan and Ohio Funds were
generally overweighted in pre-refunded bonds, with NUM, NXI and NVJ having the
heaviest exposures and NMP and NBJ the smallest allocations. Many general
obligation and other tax-supported bonds also failed to keep pace with the
overall municipal market, while education, water and sewer, leasing and resource
recovery trailed the other revenue sectors for the twelve months. The Funds
generally had lower weightings in tax-supported bonds than the market as a
whole, which lessened the negative impact from this sector.
IMPACT OF THE FUNDS' LEVERAGE STRATEGIES ON PERFORMANCE
One important factor impacting the returns of these Funds relative to the
comparative indexes was the Funds' use of financial leverage. The Funds use
leverage because their managers believe that, over time, leveraging provides
opportunities for additional income and total returns for common shareholders.
However, use of leverage also can expose common shareholders to additional
volatility. For example, as the prices of securities held by a Fund decline, the
negative impact of these valuation changes on common share net asset value and
common shareholder total return is magnified by the use of leverage. Conversely,
leverage may enhance common share returns during periods when bond prices
generally are rising.
Nuveen Investments 7
Leverage made a significant positive contribution to the performance of these
Funds over this reporting period.
RECENT DEVELOPMENTS REGARDING THE FUNDS' LEVERAGED CAPITAL STRUCTURE
Shortly after their inceptions, each of the Funds issued auction rate preferred
shares (ARPS) to create financial leverage. As noted in the past shareholder
reports, the ARPS issued by many closed-end funds, including these Funds, have
been hampered by a lack of liquidity since February 2008. Since that time, more
ARPS have been submitted for sale in each of their regularly scheduled auctions
than there have been offers to buy. In fact, offers to buy have been almost
completely non-existent since late February 2008. This means that these auctions
have "failed to clear," and that many, or all, of the ARPS shareholders who
wanted to sell their shares in these auctions were unable to do so. This lack of
liquidity in ARPS did not lower the credit quality of these shares, and ARPS
shareholders unable to sell their shares received distributions at the "maximum
rate" applicable to failed auctions, as calculated in accordance with the
pre-established terms of the ARPS. In the recent market, with short-term rates
at multigenerational lows, those maximum rates also have been low.
One continuing implication for common shareholders from the auction failures is
that each Fund's cost of leverage likely has been incrementally higher at times
than it otherwise might have been had the auctions continued to be successful.
As a result, each Fund's common share earnings likely have been incrementally
lower at times than they otherwise might have been.
As noted in past shareholder reports, the Nuveen funds' Board of
Directors/Trustees authorized several methods to refinance a portion of the
Nuveen funds' outstanding ARPS. Some Funds have invested in tender option bonds
(TOBs), also known as floating rate securities. The amount of TOBs that a Fund
may use varies according to the composition of each Fund's portfolio. Some Funds
have a greater ability to use TOBs than others. As of February 28, 2010, some
Funds have issued Variable Rate Demand Preferred Shares (VRDP), but these
issuances have been limited since it has been difficult to find liquidity
providers on economically viable terms given the constrained credit environment.
Some Funds have issued MuniFund Term Preferred Shares (MTP), a fixed-rate form
of preferred stock with a mandatory redemption period of five years.
While all these efforts have reduced the total amount of outstanding ARPS issued
by the Nuveen funds, the Funds cannot provide any assurance on when the
remaining outstanding ARPS might be redeemed.
8 Nuveen Investments
As of February 28, 2010, the amount of ARPS redeemed by the Funds are as shown
in the accompanying table.
AUCTION RATE % OF ORIGINAL
PREFERRED SHARES AUCTION RATE
FUND REDEEMED PREFERRED SHARES
--------------------------------------------------------------------------------
NUM $6,675,000 7.1%
NMP $2,300,000 4.1%
NZW $1,725,000 10.8%
NUO $4,000,000 5.2%
NXI $2,000,000 6.5%
NBJ $2,400,000 10.0%
NVJ $1,000,000 6.1%
--------------------------------------------------------------------------------
During January 2010, NZW and NVJ filed with the Securities and Exchange
Commission (SEC) a registration statement seeking to register MTP. These
registration statements, declared effective by the SEC, enable the Funds to
issue to the public shares of MTP to refinance all or a portion of their ARPS.
The issuance of MTP by these Funds is subject to market conditions. There is no
assurance that these MTP shares will be issued.
Subsequent to the reporting period, NXI and NBJ filed with the SEC a
registration statement seeking to register MTP. These registrations statements,
declared effective by the SEC, are subject to the terms and conditions as noted
in the preceding paragraph.
As of February 28, 2010, 80 out of the 84 Nuveen closed-end municipal funds that
had issued ARPS have redeemed, at par, all or a portion of these shares. These
redemptions bring the total amount of Nuveen's municipal closed-end funds' ARPS
redemptions to approximately $3.0 billion of the original approximately $11.0
billion outstanding.
For up-to-date information, please visit the Nuveen CEF Auction Rate Preferred
Resource Center at: http://www.nuveen.com/arps.
Nuveen Investments 9
Common Share Dividend and Share Price Information
During the twelve months ended February 28, 2010, each of the seven Nuveen
Michigan and Ohio Funds had three increases in their monthly dividends. NUO, NXI
and NVJ also had an additional dividend increase that was declared just prior to
the start of this reporting period and took effect in March 2009.
Due to normal portfolio activity, common shareholders of NXI received a net
ordinary income distribution of $0.0094 per share at the beginning of December
2009.
All of the Funds in this report seek to pay stable dividends at rates that
reflect each Fund's past results and projected future performance. During
certain periods, each Fund may pay dividends at a rate that may be more or less
than the amount of net investment income actually earned by the Fund during the
period. If a Fund has cumulatively earned more than it has paid in dividends, it
holds the excess in reserve as undistributed net investment income (UNII) as
part of the Fund's NAV. Conversely, if a Fund has cumulatively paid dividends in
excess of its earnings, the excess constitutes negative UNII that is likewise
reflected in the Fund's NAV. Each Fund will, over time, pay all of its net
investment income as dividends to shareholders. As of February 28, 2010, all of
the Funds in this report had positive UNII balances for both tax and financial
statement purposes.
COMMON SHARE REPURCHASES AND SHARE PRICE INFORMATION
As of February 28, 2010, and the since inception of the Funds' repurchase
program the following Funds have cumulatively repurchased common shares as shown
in the accompanying table.
COMMON SHARES % OF OUTSTANDING
FUND REPURCHASED COMMON SHARES
--------------------------------------------------------------------------------
NUM 153,900 1.3%
NMP 137,100 1.8%
NZW 12,200 0.6%
NUO -- --
NXI 600 0.0%*
NBJ -- --
NVJ 1,700 0.1%
--------------------------------------------------------------------------------
* Rounds to less than 0.1%.
10 Nuveen Investments
During the twelve-month reporting period, the following Funds repurchased common
shares at a weighted average price and a weighted average discount per common
share as shown in the accompanying table.
WEIGHTED AVERAGE WEIGHTED AVERAGE
COMMON SHARES PRICE PER SHARE DISCOUNT PER SHARE
FUND REPURCHASED REPURCHASED REPURCHASED
--------------------------------------------------------------------------------
NUM 153,900 $11.54 18.15%
NMP 110,400 $11.50 17.11%
NZW 12,200 $12.15 13.24%
--------------------------------------------------------------------------------
As of February 28, 2010, the Funds' common share prices were trading at (-)
discounts to their common share NAVs as shown in the accompanying table.
2/28/10 TWELVE-MONTH AVERAGE
FUND (-)DISCOUNT (-)DISCOUNT
--------------------------------------------------------------------------------
NUM -12.51% -15.19%
NMP -13.19% -15.76%
NZW -12.34% -14.19%
NUO -3.53% -7.59%
NXI -4.42% -8.70%
NBJ -6.04% -9.14%
NVJ -0.85% -7.64%
--------------------------------------------------------------------------------
Nuveen Investments 11
NUM Performance OVERVIEW | Nuveen Michigan Quality Income Municipal Fund, Inc.
| as of February 28, 2010
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 12.94
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 14.79
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -12.51%
--------------------------------------------------------------------------------
Market Yield 6.12%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.88%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $170,983
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 14.89
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 9.38
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 10/17/91)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 29.40% 14.83%
--------------------------------------------------------------------------------
5-Year 0.27% 3.98%
--------------------------------------------------------------------------------
10-Year 6.10% 6.60%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 37.7%
--------------------------------------------------------------------------------
U.S. Guaranteed 17.1%
--------------------------------------------------------------------------------
Tax Obligation/Limited 12.2%
--------------------------------------------------------------------------------
Utilities 10.1%
--------------------------------------------------------------------------------
Health Care 9.2%
--------------------------------------------------------------------------------
Water and Sewer 7.3%
--------------------------------------------------------------------------------
Other 6.4%
--------------------------------------------------------------------------------
CREDIT QUALITY (as a % of total investments)
[PIE CHART]
AAA/U.S. Guaranteed 40%
AA 28%
A 25%
BBB 5%
BB or Lower 1%
N/R 1%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0555
Apr 0.0555
May 0.0585
Jun 0.0585
Jul 0.0585
Aug 0.0585
Sep 0.0620
Oct 0.0620
Nov 0.0620
Dec 0.0660
Jan 0.0660
Feb 0.0660
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 10.41
10.06
9.86
10.27
10.35
10.69
10.65
10.78
11.01
11.27
11.52
11.51
11.65
11.68
11.68
11.52
11.50
11.45
11.62
11.62
11.72
12.09
12.41
12.34
12.45
12.48
12.63
12.92
12.95
13.01
13.07
12.95
13.07
12.96
12.88
12.78
12.88
12.71
12.66
12.67
12.91
12.81
12.65
12.49
12.75
12.86
12.87
12.83
12.81
13.04
12.94
12.85
12.94
2/28/10 12.94
(1) 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 a combined federal and state income tax
rate of 31.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
12 Nuveen Investments
NMP Performance OVERVIEW | Nuveen Michigan Premium Income Municipal Fund, Inc.
| as of February 28, 2010
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S. Guaranteed 26%
AA 26%
A 39%
BBB 7%
BB or Lower 2%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0530
Apr 0.0530
May 0.0565
Jun 0.0565
Jul 0.0565
Aug 0.0565
Sep 0.0610
Oct 0.0610
Nov 0.0610
Dec 0.0640
Jan 0.0640
Feb 0.0640
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 10.40
10.00
9.76
10.12
10.19
10.44
10.40
10.52
10.75
10.94
11.18
11.19
11.37
11.56
11.49
11.23
11.08
11.20
11.29
11.33
11.42
11.60
11.96
11.92
11.95
12.06
12.27
12.43
12.51
12.70
12.63
12.58
12.57
12.29
12.34
12.25
12.27
12.13
12.13
12.33
12.32
12.32
12.15
12.13
12.27
12.33
12.31
12.36
12.32
12.43
12.46
12.46
12.50
2/28/10 12.50
(1) 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 a combined federal and state income tax
rate of 31.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 12.50
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 14.40
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -13.19%
--------------------------------------------------------------------------------
Market Yield 6.14%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.91%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $109,619
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 16.36
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 7.58
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 12/17/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 27.06% 14.22%
--------------------------------------------------------------------------------
5-Year 0.89% 3.86%
--------------------------------------------------------------------------------
10-Year 6.71% 6.59%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 38.9%
--------------------------------------------------------------------------------
Tax Obligation/Limited 14.0%
--------------------------------------------------------------------------------
Water and Sewer 11.9%
--------------------------------------------------------------------------------
Utilities 10.2%
--------------------------------------------------------------------------------
Health Care 8.9%
--------------------------------------------------------------------------------
U.S. Guaranteed 8.3%
--------------------------------------------------------------------------------
Other 7.8%
--------------------------------------------------------------------------------
Nuveen Investments 13
NZW Performance OVERVIEW | Nuveen Michigan Dividend Advantage Municipal Fund
| as of February 28, 2010
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 12.43
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 14.18
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -12.34%
--------------------------------------------------------------------------------
Market Yield 6.18%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.97%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $29,127
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 15.66
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 8.48
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/01)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 22.58% 17.70%
--------------------------------------------------------------------------------
5-Year 0.95% 3.82%
--------------------------------------------------------------------------------
Since Inception 3.54% 5.56%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 32.6%
--------------------------------------------------------------------------------
U.S. Guaranteed 14.1%
--------------------------------------------------------------------------------
Utilities 12.6%
--------------------------------------------------------------------------------
Tax Obligation/Limited 11.1%
--------------------------------------------------------------------------------
Health Care 9.8%
--------------------------------------------------------------------------------
Water and Sewer 9.7%
--------------------------------------------------------------------------------
Other 10.1%
--------------------------------------------------------------------------------
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S. Guaranteed 41%
AA 22%
A 26%
BBB 5%
BB or Lower 1%
N/R 5%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0555
Apr 0.0555
May 0.0565
Jun 0.0565
Jul 0.0565
Aug 0.0565
Sep 0.0620
Oct 0.0620
Nov 0.0620
Dec 0.0640
Jan 0.0640
Feb 0.0640
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 10.45
10.21
10.00
10.16
10.15
10.36
10.38
10.76
11.09
11.18
11.66
11.61
11.45
11.30
11.47
10.97
11.08
11.00
11.26
11.20
11.30
11.50
12.19
12.25
11.94
12.21
12.06
12.35
12.44
12.64
12.67
12.49
12.61
12.36
12.35
12.25
12.32
12.04
12.10
12.22
12.29
12.27
12.07
12.05
12.17
12.25
12.18
12.21
12.36
12.48
12.28
12.23
12.43
2/28/10 12.43
(1) 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 a combined federal and state income tax
rate of 31.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
14 Nuveen Investments
NUO Performance OVERVIEW | Nuveen Ohio Quality Income Municipal Fund, Inc.
| as of February 28, 2010
CREDIT QUALITY (as a % of total investments)
[PIE CHART]
AAA/U.S. Guaranteed 30%
AA 29%
A 28%
BBB 8%
N/R 5%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0575
Apr 0.0575
May 0.0645
Jun 0.0645
Jul 0.0645
Aug 0.0645
Sep 0.0680
Oct 0.0680
Nov 0.0680
Dec 0.0740
Jan 0.0740
Feb 0.0740
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 13.01
12.03
12.01
12.16
12.46
12.74
13.13
12.99
13.10
13.43
13.50
13.82
13.87
13.95
13.71
13.76
13.71
13.71
13.69
13.65
13.70
13.73
13.90
13.85
14.02
14.48
14.47
14.87
15.04
14.93
14.99
15.30
14.92
14.35
14.65
14.52
14.63
14.34
14.40
14.63
14.96
15.02
15.45
15.70
16.00
16.03
15.78
15.62
15.65
15.77
15.84
15.45
15.58
2/28/10 15.58
(1) 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 a combined federal and state income tax
rate of 32.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 15.58
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 16.15
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -3.53%
--------------------------------------------------------------------------------
Market Yield 5.70%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.39%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $157,439
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 15.92
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 8.14
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 10/17/91)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 27.57% 16.76%
--------------------------------------------------------------------------------
5-Year 2.81% 4.58%
--------------------------------------------------------------------------------
10-Year 5.87% 6.46%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 26.7%
--------------------------------------------------------------------------------
Health Care 15.2%
--------------------------------------------------------------------------------
U.S. Guaranteed 14.3%
--------------------------------------------------------------------------------
Tax Obligation/Limited 10.9%
--------------------------------------------------------------------------------
Education and Civic Organizations 10.2%
--------------------------------------------------------------------------------
Utilities 5.6%
--------------------------------------------------------------------------------
Consumer Staples 5.2%
--------------------------------------------------------------------------------
Other 11.9%
--------------------------------------------------------------------------------
Nuveen Investments 15
NXI Performance OVERVIEW | Nuveen Ohio Dividend Advantage Municipal Fund
| as of February 28, 2010
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 14.48
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 15.15
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -4.42%
--------------------------------------------------------------------------------
Market Yield 5.80%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.54%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $64,290
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 15.12
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 7.79
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 3/27/01)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 26.70% 15.46%
--------------------------------------------------------------------------------
5-Year 3.42% 4.84%
--------------------------------------------------------------------------------
Since Inception 5.38% 6.43%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 23.4%
--------------------------------------------------------------------------------
Tax Obligation/General 17.3%
--------------------------------------------------------------------------------
Health Care 13.1%
--------------------------------------------------------------------------------
Tax Obligation/Limited 12.3%
--------------------------------------------------------------------------------
Utilities 6.9%
--------------------------------------------------------------------------------
Education and Civic Organizations 6.3%
--------------------------------------------------------------------------------
Housing/Multifamily 6.2%
--------------------------------------------------------------------------------
Other 14.5%
--------------------------------------------------------------------------------
CREDIT QUALITY (as a % of total investments)
[PIE CHART]
AAA/U.S. GUARANTEED 38%
AA 23%
A 21%
BBB 11%
N/R 7%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE(2)
[BAR CHART]
Mar 0.0570
Apr 0.0570
May 0.0620
Jun 0.0620
Jul 0.0620
Aug 0.0620
Sep 0.0640
Oct 0.0640
Nov 0.0640
Dec 0.0700
Jan 0.0700
Feb 0.0700
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 12.16
11.80
11.80
11.80
12.05
11.83
12.14
12.15
12.31
12.44
12.71
12.63
12.79
13.01
12.92
12.84
12.52
12.82
12.79
12.95
13.18
13.25
13.12
13.33
13.23
13.39
13.65
13.87
14.57
14.30
14.46
14.41
13.94
13.27
13.75
13.84
13.84
13.80
13.40
13.66
13.95
13.84
13.89
14.05
14.08
14.01
14.19
14.22
14.50
14.43
14.54
14.60
14.48
2/28/10 14.48
(1) 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 a combined federal and state income tax
rate of 32.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
(2) The Fund paid shareholders net ordinary income distributions in December
2009 of $0.0094 per share.
16 Nuveen Investments
NBJ Performance OVERVIEW | Nuveen Ohio Dividend Advantage Municipal Fund 2
| as of February 28, 2010
CREDIT QUALITY (as a % of total investments)
[PIE CHART]
AAA/U.S. Guaranteed 28%
AA 21%
A 25%
BBB 15%
N/R 11%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0545
Apr 0.0545
May 0.0580
Jun 0.0580
Jul 0.0580
Aug 0.0580
Sep 0.0630
Oct 0.0630
Nov 0.0630
Dec 0.0690
Jan 0.0690
Feb 0.0690
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 11.45
11.13
10.93
11.04
11.35
11.51
11.45
11.39
11.54
11.85
11.91
11.99
12.13
12.30
12.22
12.14
11.77
11.84
11.97
12.14
12.10
12.12
12.63
12.91
12.83
12.83
12.81
13.13
13.40
13.58
13.45
13.70
13.57
12.66
13.09
13.06
13.36
13.11
13.04
13.04
13.49
13.43
13.43
13.70
13.60
13.84
14.03
14.40
14.00
13.97
14.06
14.00
13.85
2/28/10 13.85
(1) 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 a combined federal and state income tax
rate of 32.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 13.85
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 14.74
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -6.04%
--------------------------------------------------------------------------------
Market Yield 5.98%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.81%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $46,000
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 16.75
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 8.57
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/01)
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 26.62% 18.91%
--------------------------------------------------------------------------------
5-Year 2.77% 4.44%
--------------------------------------------------------------------------------
Since Inception 4.75% 5.95%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 29.9%
--------------------------------------------------------------------------------
Health Care 18.1%
--------------------------------------------------------------------------------
U.S. Guaranteed 11.4%
--------------------------------------------------------------------------------
Tax Obligation/Limited 10.1%
--------------------------------------------------------------------------------
Education and Civic 8.0%
--------------------------------------------------------------------------------
Organizations Industrials 7.5%
--------------------------------------------------------------------------------
Utilities 6.6%
--------------------------------------------------------------------------------
Other 8.4%
--------------------------------------------------------------------------------
Nuveen Investments 17
NVJ Performance OVERVIEW | Nuveen Ohio Dividend Advantage Municipal Fund 3
| as of February 28, 2010
FUND SNAPSHOT
--------------------------------------------------------------------------------
Common Share Price $ 15.20
--------------------------------------------------------------------------------
Common Share Net Asset Value $ 15.33
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -0.85%
--------------------------------------------------------------------------------
Market Yield 5.76%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 8.48%
--------------------------------------------------------------------------------
Net Assets Applicable to Common Shares ($000) $33,062
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 14.73
--------------------------------------------------------------------------------
Leverage-Adjusted Duration 7.90
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 3/25/02)
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 34.62% 15.73%
--------------------------------------------------------------------------------
5-Year 4.16% 4.95%
--------------------------------------------------------------------------------
Since Inception 5.89% 6.45%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 25.1%
--------------------------------------------------------------------------------
Tax Obligation/General 23.4%
--------------------------------------------------------------------------------
Health Care 14.1%
--------------------------------------------------------------------------------
Tax Obligation/Limited 9.3%
--------------------------------------------------------------------------------
Utilities 5.3%
--------------------------------------------------------------------------------
Industrials 4.8%
--------------------------------------------------------------------------------
Consumer Staples 4.6%
--------------------------------------------------------------------------------
Other 13.4%
--------------------------------------------------------------------------------
CREDIT QUALITY (as a % of total investments)
[PIE CHART]
AAA/U.S. Guaranteed 45%
AA 17%
A 22%
BBB 12%
N/R 4%
2009-2010 MONTHLY TAX-FREE DIVIDENDS PER COMMON SHARE
[BAR CHART]
Mar 0.0590
Apr 0.0590
May 0.0635
Jun 0.0635
Jul 0.0635
Aug 0.0635
Sep 0.0670
Oct 0.0670
Nov 0.0670
Dec 0.0730
Jan 0.0730
Feb 0.0730
COMMON SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE GRAPH]
3/01/09 11.92
11.50
11.95
12.50
12.33
12.16
12.25
12.39
12.95
12.86
12.89
12.94
12.94
13.40
13.27
13.30
13.63
13.72
13.40
13.38
13.37
13.44
13.36
13.68
13.60
13.84
13.69
14.00
14.20
14.12
14.20
14.36
14.30
13.55
13.62
13.50
13.63
13.60
13.80
13.95
14.30
14.36
14.48
14.15
14.73
14.70
15.00
15.05
15.10
14.95
15.14
15.15
15.20
2/28/10 15.20
(1) 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 a combined federal and state income tax
rate of 32.1%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
18 Nuveen Investments
NUM NMP NZW | Shareholder Meeting Report
|
| The annual meeting of shareholders was held in the offices of
Nuveen Investments on November 30, 2009; at this meeting the
shareholders were asked to vote on the election of Board Members,
the elimination of Fundamental Investment Policies and the
approval of new Fundamental Investment Policies. The meeting for
NMP, NZW, NUO, NXI, NBJ and NVJ was subsequently adjourned to
January 12, 2010; the meeting for NUO and NBJ was additionally
adjourned to March 23, 2010.
NUM NMP NZW
------------------------------------------------------------------------------------------------------------------------------------
Common and Common and Common and
Preferred Preferred Preferred Preferred Preferred Preferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
------------------------------------------------------------------------------------------------------------------------------------
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICIES RELATING TO
INVESTMENTS IN MUNICIPAL SECURITIES AND
BELOW INVESTMENT GRADE SECURITIES.
For -- -- -- -- 993,808 425
Against -- -- -- -- 65,551 33
Abstain -- -- -- -- 43,319 3
Broker Non-Votes -- -- -- -- 306,574 --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- -- -- 1,409,252 461
====================================================================================================================================
TO APPROVE THE NEW FUNDAMENTAL POLICY
RELATING TO INVESTMENTS IN MUNICIPAL
SECURITIES.
For -- -- -- -- 1,002,527 428
Against -- -- -- -- 58,650 33
Abstain -- -- -- -- 41,501 --
Broker Non-Votes -- -- -- -- 306,574 --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- -- -- 1,409,252 461
====================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICY RELATING TO
COMMODITIES.
For -- -- 3,991,905 1,344 -- --
Against -- -- 352,972 221 -- --
Abstain -- -- 198,423 3 -- --
Broker Non-Votes -- -- 1,069,061 -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- 5,612,361 1,568 -- --
====================================================================================================================================
TO APPROVE THE NEW FUNDAMENTAL POLICY
RELATING TO COMMODITIES.
For -- -- 3,958,211 1,344 -- --
Against -- -- 368,951 221 -- --
Abstain -- -- 216,138 3 -- --
Broker Non-Votes -- -- 1,069,061 -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- 5,612,361 1,568 -- --
====================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICIES RELATING TO
DERIVATIVES AND SHORT SALES.
For -- -- 4,014,880 1,412 -- --
Against -- -- 317,423 150 -- --
Abstain -- -- 210,997 6 -- --
Broker Non-Votes -- -- 1,069,061 -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- 5,612,361 1,568 -- --
====================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICIES PROHIBITING
INVESTMENT IN OTHER INVESTMENT COMPANIES.
For -- -- 4,000,871 1,344 -- --
Against -- -- 316,686 219 -- --
Abstain -- -- 225,743 5 -- --
Broker Non-Votes -- -- 1,069,061 -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- -- 5,612,361 1,568 -- --
====================================================================================================================================
Nuveen Investments 19
NUM NMP NZW | Shareholder Meeting Report (continued)
NUM NMP NZW
------------------------------------------------------------------------------------------------------------------------------------
Common and Common and Common and
Preferred Preferred Preferred Preferred Preferred Preferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS WAS
REACHED AS FOLLOWS:
John P. Amboian
For 9,896,861 1,522 5,337,324 1,168 -- --
Withhold 316,435 540 275,037 400 -- --
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 -- --
====================================================================================================================================
Robert P. Bremner
For 9,895,264 1,522 5,342,390 1,168 1,328,552 429
Withhold 318,032 540 269,971 400 80,700 32
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 1,409,252 461
====================================================================================================================================
Jack B. Evans
For 9,889,153 1,522 5,322,367 1,168 1,334,532 429
Withhold 324,143 540 289,994 400 74,720 32
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 1,409,252 461
====================================================================================================================================
William C. Hunter
For -- 1,522 -- 1,168 -- 429
Withhold -- 540 -- 400 -- 32
------------------------------------------------------------------------------------------------------------------------------------
Total -- 2,062 -- 1,568 -- 461
====================================================================================================================================
David J. Kundert
For 9,890,901 1,522 5,362,143 1,168 -- --
Withhold 322,395 540 250,218 400 -- --
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 -- --
====================================================================================================================================
William J. Schneider
For -- 1,522 -- 1,168 -- 429
Withhold -- 540 -- 400 -- 32
------------------------------------------------------------------------------------------------------------------------------------
Total -- 2,062 -- 1,568 -- 461
====================================================================================================================================
Judith M. Stockdale
For 9,892,135 1,522 5,367,550 1,168 -- --
Withhold 321,161 540 244,811 400 -- --
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 -- --
====================================================================================================================================
Carole E. Stone
For 9,897,216 1,522 5,343,770 1,168 -- --
Withhold 316,080 540 268,591 400 -- --
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 -- --
====================================================================================================================================
Terence J. Toth
For 9,892,880 1,522 5,366,887 1,168 -- --
Withhold 320,416 540 245,474 400 -- --
------------------------------------------------------------------------------------------------------------------------------------
Total 10,213,296 2,062 5,612,361 1,568 -- --
====================================================================================================================================
20 Nuveen Investments
NUO |
NXI |
NBJ |
NUO NXI NBJ
---------------------------------------------------------------------------------------------------------------------------------
Common and Common and Common and
Preferred Preferred Preferred Preferred Preferred Preferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
---------------------------------------------------------------------------------------------------------------------------------
TO APPROVE THE ELIMINATION
OF THE FUNDAMENTAL POLICIES
RELATING TO INVESTMENTS IN
MUNICIPAL SECURITIES AND BELOW
INVESTMENT GRADE SECURITIES.
For 4,920,992 1,656 1,974,752 640 1,521,947 713
Against 315,067 330 83,424 26 71,278 33
Abstain 231,469 9 166,631 -- 103,065 --
Broker Non-Votes 1,414,225 376 665,003 -- 414,866 --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 2,889,810 666 2,111,156 746
=================================================================================================================================
TO APPROVE THE NEW FUNDAMENTAL
POLICY RELATING TO INVESTMENTS
IN MUNICIPAL SECURITIES.
For 4,938,849 1,661 1,983,198 643 1,523,292 729
Against 283,367 325 77,801 23 68,188 17
Abstain 245,311 9 163,808 -- 104,810 --
Broker Non-Votes 1,414,226 376 665,003 -- 414,866 --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 2,889,810 666 2,111,156 746
=================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICY RELATING TO
COMMODITIES.
For 4,887,959 1,656 -- -- -- --
Against 323,577 329 -- -- -- --
Abstain 255,992 10 -- -- -- --
Broker Non-Votes 1,414,225 376 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 -- -- -- --
=================================================================================================================================
TO APPROVE THE NEW FUNDAMENTAL
POLICY RELATING TO
COMMODITIES.
For 4,882,001 1,656 -- -- -- --
Against 320,137 329 -- -- -- --
Abstain 265,389 10 -- -- -- --
Broker Non-Votes 1,414,226 376 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 -- -- -- --
=================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICIES RELATING
TO DERIVATIVES AND SHORT
SALES.
For 4,861,914 1,652 -- -- -- --
Against 339,849 333 -- -- -- --
Abstain 265,764 10 -- -- -- --
Broker Non-Votes 1,414,226 376 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 -- -- -- --
=================================================================================================================================
TO APPROVE THE ELIMINATION OF THE
FUNDAMENTAL POLICIES
PROHIBITING INVESTMENT IN
OTHER INVESTMENT COMPANIES.
For 4,887,938 1,655 -- -- -- --
Against 306,388 331 -- -- -- --
Abstain 273,201 9 -- -- -- --
Broker Non-Votes 1,414,226 376 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,881,753 2,371 -- -- -- --
=================================================================================================================================
Nuveen Investments 21
NUO | Shareholder Meeting Report (continued)
NXI |
NBJ |
NUO NXI NBJ
---------------------------------------------------------------------------------------------------------------------------------
Common and Common and Common and
Preferred Preferred Preferred Preferred Preferred Preferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
---------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD
MEMBERS WAS REACHED AS
FOLLOWS:
John P. Amboian
For 6,305,259 998 -- -- -- --
Withhold 564,042 667 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 -- -- -- --
=================================================================================================================================
Robert P. Bremner
For 6,395,821 998 2,706,459 432 1,978,121 330
Withhold 473,480 667 183,351 234 125,741 122
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 2,889,810 666 2,103,862 452
=================================================================================================================================
Jack B. Evans
For 6,401,810 998 2,705,459 432 1,967,971 330
Withhold 467,491 667 184,351 234 135,891 122
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 2,889,810 666 2,103,862 452
=================================================================================================================================
William C. Hunter
For -- 998 -- 432 -- 330
Withhold -- 667 -- 234 -- 122
---------------------------------------------------------------------------------------------------------------------------------
Total -- 1,665 -- 666 -- 452
=================================================================================================================================
David J. Kundert
For 6,396,301 998 -- -- -- --
Withhold 473,000 667 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 -- -- -- --
=================================================================================================================================
William J. Schneider
For -- 998 -- 432 -- 330
Withhold -- 667 -- 234 -- 122
---------------------------------------------------------------------------------------------------------------------------------
Total -- 1,665 -- 666 -- 452
=================================================================================================================================
Judith M. Stockdale
For 6,404,428 998 -- -- -- --
Withhold 464,873 667 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 -- -- -- --
=================================================================================================================================
Carole E. Stone
For 6,395,173 998 -- -- -- --
Withhold 474,128 667 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 -- -- -- --
=================================================================================================================================
Terence J. Toth
For 6,404,496 998 -- -- -- --
Withhold 464,805 667 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Total 6,869,301 1,665 -- -- -- --
=================================================================================================================================
22 Nuveen Investments
NVJ |
NVJ
----------------------------------------------------------------------------------------
Common and
Preferred Preferred
shares voting shares voting
together together
as a class as a class
----------------------------------------------------------------------------------------
TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL
POLICIES RELATING TO INVESTMENTS IN MUNICIPAL
SECURITIES AND BELOW INVESTMENT GRADE SECURITIES.
For 1,076,486 408
Against 118,430 19
Abstain 50,359 --
Broker Non-Votes 357,887 --
----------------------------------------------------------------------------------------
Total 1,603,162 427
========================================================================================
TO APPROVE THE NEW FUNDAMENTAL POLICY RELATING TO
INVESTMENTS IN MUNICIPAL SECURITIES.
For 1,082,830 408
Against 105,152 19
Abstain 57,293 --
Broker Non-Votes 357,887 --
----------------------------------------------------------------------------------------
Total 1,603,162 427
========================================================================================
TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL POLICY
RELATING TO COMMODITIES.
For -- --
Against -- --
Abstain -- --
Broker Non-Votes -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
TO APPROVE THE NEW FUNDAMENTAL POLICY RELATING TO
COMMODITIES.
For -- --
Against -- --
Abstain -- --
Broker Non-Votes -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL
POLICIES RELATING TO DERIVATIVES AND SHORT SALES.
For -- --
Against -- --
Abstain -- --
Broker Non-Votes -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
TO APPROVE THE ELIMINATION OF THE FUNDAMENTAL
POLICIES PROHIBITING INVESTMENT IN OTHER INVESTMENT
COMPANIES.
For -- --
Against -- --
Abstain -- --
Broker Non-Votes -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
Nuveen Investments 23
NVJ | Shareholder Meeting Report (continued)
NVJ
----------------------------------------------------------------------------------------
Common and
Preferred Preferred
shares voting shares voting
together together
as a classs as a class
----------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS WAS REACHED AS FOLLOWS:
John P. Amboian
For -- --
Withhold -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
Robert P. Bremner
For 1,476,330 297
Withhold 126,832 130
----------------------------------------------------------------------------------------
Total 1,603,162 427
========================================================================================
Jack B. Evans
For 1,476,030 297
Withhold 127,132 130
----------------------------------------------------------------------------------------
Total 1,603,162 427
========================================================================================
William C. Hunter
For -- 297
Withhold -- 130
----------------------------------------------------------------------------------------
Total -- 427
========================================================================================
David J. Kundert
For -- --
Withhold -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
William J. Schneider
For -- 297
Withhold -- 130
----------------------------------------------------------------------------------------
Total -- 427
========================================================================================
Judith M. Stockdale
For -- --
Withhold -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
Carole E. Stone
For -- --
Withhold -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
Terence J. Toth
For -- --
Withhold -- --
----------------------------------------------------------------------------------------
Total -- --
========================================================================================
24 Nuveen Investments
Report of Independent
Registered Public Accounting Firm
THE BOARD OF DIRECTORS/TRUSTEES AND SHAREHOLDERS
NUVEEN MICHIGAN QUALITY INCOME MUNICIPAL FUND, INC.
NUVEEN MICHIGAN PREMIUM INCOME MUNICIPAL FUND, INC.
NUVEEN MICHIGAN DIVIDEND ADVANTAGE MUNICIPAL FUND
NUVEEN OHIO QUALITY INCOME MUNICIPAL FUND, INC.
NUVEEN OHIO DIVIDEND ADVANTAGE MUNICIPAL FUND
NUVEEN OHIO DIVIDEND ADVANTAGE MUNICIPAL FUND 2
NUVEEN OHIO DIVIDEND ADVANTAGE MUNICIPAL FUND 3
We have audited the accompanying statement of assets and liabilities, including
the portfolios of investments, of Nuveen Michigan Quality Income Municipal Fund,
Inc., Nuveen Michigan Premium Income Municipal Fund, Inc., Nuveen Michigan
Dividend Advantage Municipal Fund, Nuveen Ohio Quality Income Municipal Fund,
Inc., Nuveen Ohio Dividend Advantage Municipal Fund, Nuveen Ohio Dividend
Advantage Municipal Fund 2, and Nuveen Ohio Dividend Advantage Municipal Fund 3
(the Funds) as of February 28, 2010, and the related statements of operations,
changes in net assets, and the financial highlights for each of the periods
indicated therein. 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 conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). 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. We were
not engaged to perform an audit of the Funds' internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Funds' internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of February 28, 2010, by correspondence with the custodian
and brokers or by other appropriate auditing procedures where replies from
brokers were not received. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of
Nuveen Michigan Quality Income Municipal Fund, Inc., Nuveen Michigan Premium
Income Municipal Fund, Inc., Nuveen Michigan Dividend Advantage Municipal Fund,
Nuveen Ohio Quality Income Municipal Fund, Inc., Nuveen Ohio Dividend Advantage
Municipal Fund, Nuveen Ohio Dividend Advantage Municipal Fund 2, and Nuveen Ohio
Dividend Advantage Municipal Fund 3 at February 28, 2010, and the results of
their operations, the changes in their net assets, and the financial highlights
for each of the periods indicated therein in conformity with US generally
accepted accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
April 23, 2010
Nuveen Investments 25
NUM | Nuveen Michigan Quality Income Municipal Fund, Inc.
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 2.1% (1.4% OF TOTAL INVESTMENTS)
$ 4,000 Michigan Tobacco Settlement Finance Authority, Tobacco Settlement 6/18 at 100.00 Baa3 $ 3,674,480
Asset-Backed Revenue Bonds, Series 2008A, 6.875%, 6/01/42
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 3.1% (2.1% OF TOTAL
INVESTMENTS)
1,685 Michigan Higher Education Facilities Authority, Limited 9/11 at 100.00 N/R 1,688,926
Obligation Revenue Refunding Bonds, Kettering University,
Series 2001, 5.500%, 9/01/17 - AMBAC Insured
1,500 Michigan Higher Education Student Loan Authority, Revenue Bonds, No Opt. Call AA 1,487,580
Series 2000 XII-T, 5.300%, 9/01/10 - AMBAC Insured
(Alternative Minimum Tax)
1,000 Michigan Higher Education Student Loan Authority, Revenue Bonds, 9/12 at 100.00 AA 1,006,300
Series 2002 XVII-G, 5.200%, 9/01/20 - AMBAC Insured
(Alternative Minimum Tax)
1,115 Michigan Technological University, General Revenue Bonds, Series 10/13 at 100.00 A1 1,135,873
2004A, 5.000%, 10/01/22 - NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,300 Total Education and Civic Organizations 5,318,679
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 13.9% (9.2% OF TOTAL INVESTMENTS)
2,700 Michigan State Hospital Finance Authority, Hospital Revenue 8/10 at 100.00 BB- 2,029,887
Bonds, Detroit Medical Center Obligated Group, Series 1998A,
5.250%, 8/15/28
4,100 Michigan State Hospital Finance Authority, Hospital Revenue 11/19 at 100.00 A1 4,019,476
Bonds, Henry Ford Health System, Refunding Series 2009,
5.750%, 11/15/39
4,075 Michigan State Hospital Finance Authority, Hospital Revenue 4/13 at 100.00 A 4,019,580
Bonds, Oakwood Obligated Group, Series 2002A, 5.750%, 4/01/32
2,500 Michigan State Hospital Finance Authority, Hospital Revenue 6/19 at 100.00 AAA 2,608,750
Bonds, Mid-Michigan Obligated Group, Series 2009A, 5.875%,
6/01/39 - AGC Insured
1,000 Michigan State Hospital Finance Authority, Hospital Revenue 5/10 at 101.00 BBB 1,004,670
Refunding Bonds, Memorial Healthcare Center Obligated Group,
Series 1999, 5.875%, 11/15/21
Michigan State Hospital Finance Authority, Revenue Bonds,
Marquette General Hospital, Series 2005A:
1,500 5.000%, 5/15/26 5/15 at 100.00 Baa3 1,313,205
55 5.000%, 5/15/34 5/15 at 100.00 Baa3 43,209
1,150 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 9/18 at 100.00 A1 1,357,552
Bonds, William Beaumont Hospital, Refunding Series 2009V,
8.250%, 9/01/39
5,500 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 11/11 at 100.00 A1 5,154,379
Bonds, William Beaumont Hospital, Series 2001M, 5.250%,
11/15/31 - NPFG Insured
2,195 University of Michigan, Medical Service Plan Revenue Bonds, No Opt. Call AA+ 2,185,649
Series 1991, 0.000%, 12/01/10
-----------------------------------------------------------------------------------------------------------------------------------
24,775 Total Health Care 23,736,357
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 2.7% (1.8% OF TOTAL INVESTMENTS)
2,675 Michigan Housing Development Authority, FNMA Limited Obligation 12/20 at 101.00 AAA 2,809,285
Multifamily Housing Revenue Bonds, Parkview Place Apartments,
Series 2002A, 5.550%, 12/01/34 (Alternative Minimum Tax)
215 Michigan Housing Development Authority, Rental Housing Revenue 4/10 at 100.50 AA 215,350
Bonds, Series 1999A, 5.300%, 10/01/37 - NPFG Insured
(Alternative Minimum Tax)
1,300 Michigan Housing Development Authority, Rental Housing Revenue 7/15 at 100.00 AAA 1,324,544
Bonds, Series 2006D, 5.125%, 4/01/31 - AGM Insured
(Alternative Minimum Tax)
200 Michigan Housing Development Authority, Rental Housing Revenue 10/18 at 100.00 AA 207,694
Bonds, Series 2009A, 5.700%, 10/01/39
-----------------------------------------------------------------------------------------------------------------------------------
4,390 Total Housing/Multifamily 4,556,873
-----------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 0.7% (0.5% OF TOTAL INVESTMENTS)
1,250 Dickinson County Economic Development Corporation, Michigan, 11/14 at 100.00 BBB 1,217,038
Pollution Control Revenue Bonds, International Paper Company,
Series 2004A, 4.800%, 11/01/18
-----------------------------------------------------------------------------------------------------------------------------------
26 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 57.0% (37.7% OF TOTAL INVESTMENTS)
$ 1,000 Anchor Bay School District, Macomb and St. Clair Counties, 5/12 at 100.00 AA- $ 1,030,670
Michigan, General Obligation Refunding Bonds, Series 2002,
5.000%, 5/01/25
Anchor Bay School District, Macomb and St. Clair Counties,
Michigan, Unlimited Tax General Obligation Refunding Bonds,
Series 2001:
2,500 5.000%, 5/01/21 5/11 at 100.00 AA- 2,607,875
3,200 5.000%, 5/01/29 5/11 at 100.00 AA- 3,215,808
1,000 Ann Arbor, Michigan, General Obligation Bonds, Court & Police 5/18 at 100.00 AA+ 1,044,630
Facilities Capital Improvement Series 2008, 5.000%, 5/01/38
1,320 Bridgeport Spaulding Community School District, Saginaw County, 5/12 at 100.00 AA- 1,439,592
Michigan, General Obligation Bonds, Series 2002, 5.500%,
5/01/16
2,110 Caledonia Community Schools, Kent, Allegan and Barry Counties, 5/13 at 100.00 AA- 2,297,537
Michigan, General Obligation Bonds, Series 2003, 5.250%,
5/01/20
1,000 Caledonia Community Schools, Kent, Allegan and Barry Counties, 5/15 at 100.00 AA- 1,038,590
Michigan, General Obligation Bonds, Series 2005, 5.000%,
5/01/25 - NPFG Insured
2,319 Caledonia Community Schools, Kent, Allegan and Barry Counties, 5/17 at 100.00 AA- 2,233,730
Michigan, General Obligation Bonds, Tender Option Bond Trust
2008-1096, 8.044%, 5/01/32 - NPFG Insured (IF)
1,215 Charter County of Wayne, Michigan, General Obligation Limited Tax 12/19 at 100.00 A 1,275,045
Building Improvement Bonds, Series 2009, 6.750%, 11/01/39
2,000 Detroit City School District, Wayne County, Michigan, General No Opt. Call AA- 2,242,140
Obligation Bonds, Series 2002A, 6.000%, 5/01/19 - FGIC Insured
700 Detroit-Wayne County Stadium Authority, Michigan, Limited Tax 4/10 at 100.00 A 700,847
General Obligation Building Authority Stadium Bonds, Series
1997, 5.500%, 2/01/17 - FGIC Insured
285 East Grand Rapids Public Schools, County of Kent, State of 5/11 at 100.00 AA 286,747
Michigan, General Obligation Bonds, Series 2001, Refunding,
5.125%, 5/01/29
Grand Rapids and Kent County Joint Building Authority, Michigan,
Limited Tax General Obligation Bonds, Devos Place Project,
Series 2001:
8,900 0.000%, 12/01/25 No Opt. Call AAA 4,352,100
3,000 0.000%, 12/01/26 No Opt. Call AAA 1,379,130
5,305 0.000%, 12/01/29 No Opt. Call AAA 2,037,863
1,700 Grand Rapids, Michigan, General Obligation Bonds, Series 2007, 9/17 at 100.00 AA 1,810,517
5.000%, 9/01/27 - NPFG Insured
2,000 Hartland Consolidated School District, Livingston County, 5/11 at 100.00 AA- 2,011,560
Michigan, General Obligation Refunding Bonds, Series 2001,
5.125%, 5/01/29
1,400 Howell Public Schools, Livingston County, Michigan, General 11/13 at 100.00 AA- 1,488,984
Obligation Bonds, Series 2003, 5.000%, 5/01/21
1,065 Jackson Public Schools, Jackson County, Michigan, General 5/14 at 100.00 AAA 1,123,905
Obligation School Building and Site Bonds, Series 2004,
5.000%, 5/01/22 - AGM Insured
1,935 Kalamazoo Public Schools, Michigan, General Obligation Bonds, 5/16 at 100.00 AAA 2,055,938
Series 2006, 5.000%, 5/01/25 - AGM Insured
200 L'Anse Creuse Public Schools, Macomb County, Michigan, General 5/15 at 100.00 AAA 203,084
Obligation Bonds, Series 2005, 5.000%, 5/01/35 - AGM Insured
2,505 Lincoln Consolidated School District, Washtenaw and Wayne 5/16 at 100.00 AA- 2,618,076
Counties, Michigan, General Obligation Bonds, Series 2006,
5.000%, 5/01/25 - NPFG Insured
2,810 Livonia Public Schools, Wayne County, Michigan, General 5/14 at 100.00 AA- 2,955,699
Obligation Bonds, Series 2004A, 5.000%, 5/01/21 - NPFG Insured
865 Lowell Area Schools, Counties of Ionia and Kent, Michigan, 5/17 at 100.00 AAA 873,771
General Obligation Bonds, Series 2007, 5.000%, 5/01/37 - AGM
Insured
1,500 Marshall Public Schools, Calhoun County, Michigan, General 5/17 at 100.00 AA- 1,534,395
Obligation Bonds, Series 2007, 5.000%, 5/01/30 - SYNCORA GTY
Insured
2,100 Michigan Municipal Bond Authority, General Obligation Bonds, 6/15 at 100.00 AAA 2,277,975
Detroit City School District, Series 2005, 5.000%, 6/01/18 -
AGM Insured
4,000 Michigan, General Obligation Bonds, Environmental Protection 5/13 at 100.00 AA- 4,249,640
Program, Series 2003A, 5.250%, 5/01/20
100 Michigan, General Obligation Bonds, Environmental Protection 5/19 at 100.00 AA- 110,052
Program, Series 2009A, 5.500%, 11/01/25
Nuveen Investments 27
NUM | Nuveen Michigan Quality Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 2,500 Montrose School District, Michigan, School Building and Site No Opt. Call A1 $ 2,990,775
Bonds, Series 1997, 6.000%, 5/01/22 - NPFG Insured
1,100 Muskegon County, Michigan, Limited Tax General Obligation 7/11 at 100.00 AA 1,127,027
Wastewater Management System 2 Revenue Bonds, Series 2002,
5.000%, 7/01/26 - FGIC Insured
1,000 Oakland County Building Authority, Michigan, General Obligation 9/11 at 100.00 AAA 1,029,760
Bonds, Series 2002, 5.125%, 9/01/22
3,950 Oakland Intermediate School District, Oakland County, Michigan, 5/17 at 100.00 AAA 4,052,740
General Obligation Bonds, Series 2007, 5.000%, 5/01/36 - AGM
Insured
1,595 Oakridge Public Schools, Muskegon County, Michigan, General 5/15 at 100.00 AA- 1,706,921
Obligation Bonds, Series 2005, 5.000%, 5/01/22 - NPFG Insured
Ottawa County, Michigan, Water Supply System, General Obligation
Bonds, Series 2007:
4,330 5.000%, 8/01/26 - NPFG Insured (UB) 8/17 at 100.00 Aa1 4,634,572
1,120 5.000%, 8/01/30 - NPFG Insured (UB) 8/17 at 100.00 Aa1 1,168,653
1,245 Parchment School District, Kalamazoo County, Michigan, General 5/17 at 100.00 AAA 1,153,306
Obligation Bonds, Tender Option Bond Trust 2836, 11.153%,
5/01/36 - AGM Insured (IF)
4,340 Plymouth-Canton Community School District, Wayne and Washtenaw 5/14 at 100.00 AA- 4,461,520
Counties, Michigan, General Obligation Bonds, Series 2004,
5.000%, 5/01/26 - FGIC Insured
1,000 Rockford Public Schools, Kent County, Michigan, General 5/18 at 100.00 AAA 1,016,040
Obligation Bonds, Series 2008, 5.000%, 5/01/33 - AGM Insured
200 South Haven, Van Buren County, Michigan, General Obligation 12/19 at 100.00 AAA 206,106
Bonds, Capital Improvement Series 2009, 5.125%, 12/01/33 -
AGC Insured
3,175 South Redford School District, Wayne County, Michigan, General 5/15 at 100.00 AA- 3,231,293
Obligation Bonds, School Building and Site, Series 2005,
5.000%, 5/01/30 - NPFG Insured
1,655 Southfield Library Building Authority, Michigan, General 5/15 at 100.00 AA+ 1,739,554
Obligation Bonds, Series 2005, 5.000%, 5/01/26 - NPFG Insured
2,200 Thornapple Kellogg School District, Barry County, Michigan, 5/17 at 100.00 AA- 2,231,658
General Obligation Bonds, Series 2007, 5.000%, 5/01/32 - NPFG
Insured
2,000 Trenton Public Schools District, Michigan, General Obligation 5/18 at 100.00 AAA 2,028,020
Bonds, Series 2008, 5.000%, 5/01/34 - AGM Insured
2,275 Troy City School District, Oakland County, Michigan, General 5/16 at 100.00 AA 2,505,162
Obligation Bonds, Series 2006, 5.000%, 5/01/19 - NPFG Insured
Van Dyke Public Schools, Macomb County, Michigan, General
Obligation Bonds, School Building and Site, Series 2008:
310 5.000%, 5/01/31 - AGM Insured 5/18 at 100.00 AAA 318,355
575 5.000%, 5/01/38 - AGM Insured 5/18 at 100.00 AAA 582,665
5,000 Wayne County, Michigan, Limited Tax General Obligation Airport 12/11 at 101.00 A 4,998,750
Hotel Revenue Bonds, Detroit Metropolitan Wayne County
Airport, Series 2001A, 5.000%, 12/01/21 - NPFG Insured
3,350 Wayne Westland Community Schools, Michigan, General Obligation 11/14 at 100.00 AAA 3,790,090
Bonds, Series 2004, 5.000%, 5/01/17 - AGM Insured
1,725 Williamston Community School District, Michigan, Unlimited Tax No Opt. Call A1 2,004,536
General Obligation QSBLF Bonds, Series 1996, 5.500%, 5/01/25
- NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
102,679 Total Tax Obligation/General 97,473,403
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 18.4% (12.2% OF TOTAL INVESTMENTS)
1,000 Grand Rapids Building Authority, Kent County, Michigan, Limited No Opt. Call AA 1,128,480
Tax General Obligation Bonds, Series 1998, 5.000%, 4/01/16
1,345 Grand Rapids Building Authority, Kent County, Michigan, Limited 10/11 at 100.00 AA 1,390,273
Tax General Obligation Bonds,
Series 2001, 5.125%, 10/01/26 - NPFG Insured
Michigan Building Authority, Revenue Bonds, Series 2006IA:
7,000 0.000%, 10/15/27 - FGIC Insured 10/16 at 58.27 AAA 2,710,820
6,200 0.000%, 10/15/28 - FGIC Insured 10/16 at 55.35 AAA 2,236,836
4,440 5.000%, 10/15/36 - FGIC Insured 10/16 at 100.00 A+ 4,362,744
30 Michigan Municipal Bond Authority, Local Government Loan Program 5/10 at 100.00 Aa3 30,153
Revenue Sharing Bonds, Series 1992D, 6.650%, 5/01/12
28 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
$ 2,135 Michigan State Building Authority, Revenue Bonds, Facilities 10/15 at 100.00 A+ $ 2,135,897
Program, Series 2005II, 5.000%, 10/15/33 - AMBAC Insured
Michigan State Building Authority, Revenue Refunding Bonds,
Facilities Program, Series 2003II:
5,100 5.000%, 10/15/22 - NPFG Insured 10/13 at 100.00 A+ 5,274,062
5,000 5.000%, 10/15/23 - NPFG Insured 10/13 at 100.00 A+ 5,129,249
3,500 Michigan State Trunk Line, Fund Refunding Bonds, Series 2002, 10/12 at 100.00 AAA 3,783,850
5.250%, 10/01/21 - AGM Insured
17,000 Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue No Opt. Call AA- 2,100,690
Bonds, Series 2007A, 0.000%, 8/01/44 - NPFG Insured
250 Virgin Islands Public Finance Authority Revenue and Refunding 10/19 at 100.00 BBB 225,430
Bonds (Virgin Islands Matching Fund Loan Notes) Series
2009A-1 (Senior Lien) Series 2009A-2 (Senior Lien),
5.000%, 10/01/39
1,000 Virgin Islands Public Finance Authority, Revenue Bonds, 10/19 at 100.00 BBB 1,002,220
Refunding Series 2009B, 5.000%, 10/01/25
-----------------------------------------------------------------------------------------------------------------------------------
54,000 Total Tax Obligation/Limited 31,510,704
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 0.9% (0.6% OF TOTAL INVESTMENTS)
1,000 Capital Region Airport Authority, Michigan, Revenue Refunding 7/12 at 100.00 A 1,008,160
Bonds, Series 2002, 5.250%, 7/01/21 - NPFG Insured
(Alternative Minimum Tax)
500 Wayne County Airport Authority, Michigan, Revenue Refunding No Opt. Call A 531,690
Bonds, Detroit Metropolitan Airport, Series 2007, 5.000%,
12/01/12 - FGIC Insured
-----------------------------------------------------------------------------------------------------------------------------------
1,500 Total Transportation 1,539,850
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 25.9% (17.1% OF TOTAL INVESTMENTS) (4)
1,200 Birmingham, Michigan, General Obligation Bonds, Series 2002, 10/12 at 100.50 AAA 1,336,980
5.000%, 10/01/20 (Pre-refunded 10/01/12)
935 Detroit, Michigan, Senior Lien Sewerage Disposal System Revenue 7/13 at 100.00 AAA 1,056,316
Bonds, Series 2003A, 5.000%, 7/01/17 (Pre-refunded 7/01/13) -
AGM Insured
Detroit, Michigan, Senior Lien Water Supply System Revenue
Bonds, Series 2001A:
3,400 5.750%, 7/01/28 (Pre-refunded 7/01/11) - FGIC Insured 7/11 at 101.00 A+ (4) 3,646,908
770 5.250%, 7/01/33 (Pre-refunded 7/01/11) - FGIC Insured 7/11 at 100.00 A+ (4) 813,189
730 5.250%, 7/01/33 (Pre-refunded 7/01/11) - FGIC Insured 7/11 at 100.00 A+ (4) 776,443
Detroit, Michigan, Senior Lien Water Supply System Revenue
Bonds, Series 2003A:
4,025 5.000%, 7/01/24 (Pre-refunded 7/01/13) - NPFG Insured 7/13 at 100.00 A+ (4) 4,538,711
1,500 5.000%, 7/01/25 (Pre-refunded 7/01/13) - MBIA Insured 7/13 at 100.00 A+ (4) 1,691,445
1,085 Freeland Community School District, Saginaw, Midland and Bay 5/10 at 100.00 AA- (4) 1,095,036
Counties, Michigan, General Obligation Bonds, Series 2000,
5.250%, 5/01/19 (Pre-refunded 5/01/10)
2,000 Lake Fenton Community Schools, Genesee County, Michigan, 5/12 at 100.00 AA- (4) 2,188,600
General Obligation Bonds, Series 2002, 5.000%, 5/01/24
(Pre-refunded 5/01/12)
1,790 Lansing Building Authority, Michigan, General Obligation Bonds, 6/13 at 100.00 AA+ (4) 2,024,580
Series 2003A, 5.000%, 6/01/26 (Pre-refunded 6/01/13) - MBIA
Insured
3,880 Mayville Community Schools, Tuscola County, Michigan, General 11/14 at 100.00 AA- (4) 4,530,560
Obligation Bonds, School Building and Site Project, Series
2004, 5.000%, 5/01/34 (Pre-refunded 11/01/14) - FGIC Insured
250 Michigan South Central Power Agency, Power Supply System No Opt. Call A3 (4) 265,040
Revenue Bonds, Series 2000, 6.000%, 5/01/12 (ETM)
1,500 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 (4) 1,701,105
Refunding Bonds, Henry Ford Health System, Series 2003A,
5.625%, 3/01/17 (Pre-refunded 3/01/13)
3,460 Michigan State Hospital Finance Authority, Hospital Revenue 5/10 at 100.00 Aaa 3,489,860
Refunding Bonds, St. John's Health System, Series 1998A,
5.000%, 5/15/28 - AMBAC Insured (ETM)
Michigan State Hospital Finance Authority, Revenue Bonds,
Chelsea Community Hospital,
Series 2005:
1,025 5.000%, 5/15/30 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 1,198,317
500 5.000%, 5/15/37 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 584,545
1,000 Michigan State Trunk Line, Fund Bonds, Series 2001A, 5.000%, 11/11 at 100.00 AAA 1,075,300
11/01/25 (Pre-refunded 11/01/11) - AGM Insured
2,000 Michigan, Certificates of Participation, Series 2000, 5.500%, 6/10 at 100.00 A2 (4) 2,027,860
6/01/27 (Pre-refunded 6/01/10) -
AMBAC Insured
Nuveen Investments 29
NUM | Nuveen Michigan Quality Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
$ 700 Muskegon Heights, Muskegon County, Michigan, Water Supply 11/10 at 100.00 N/R (4) $ 726,047
System Revenue Bonds, Series 2000A, 5.625%, 11/01/30
(Pre-refunded 11/01/10) - MBIA Insured
1,125 Puerto Rico Highway and Transportation Authority, Highway 7/10 at 101.00 BBB (4) 1,158,896
Revenue Bonds, Series 2000B, 6.000%, 7/01/39 (Pre-refunded
7/01/10)
Puerto Rico Public Finance Corporation, Commonwealth
Appropriation Bonds, Series 2002E:
85 6.000%, 8/01/26 (ETM) No Opt. Call BBB- (4) 108,359
915 6.000%, 8/01/26 (ETM) No Opt. Call AAA 1,166,451
4,100 Puerto Rico, Highway Revenue Bonds, Highway and Transportation 7/16 at 100.00 Aaa 4,952,636
Authority, Series 1996Y, 5.500%, 7/01/36 (Pre-refunded
7/01/16)
1,000 Rochester Community School District, Oakland and Macomb 5/10 at 100.00 AA- (4) 1,009,980
Counties, Michigan, General Obligation Bonds, Series 2000I,
5.750%, 5/01/19 (Pre-refunded 5/01/10) - FGIC Insured
1,050 Warren Consolidated School District, Macomb and Oakland 11/11 at 100.00 AAA 1,135,638
Counties, Michigan, General Obligation Bonds, Series 2001,
5.375%, 5/01/19 (Pre-refunded 11/01/11) - AGM Insured
-----------------------------------------------------------------------------------------------------------------------------------
40,025 Total U.S. Guaranteed 44,298,802
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 15.3% (10.1% OF TOTAL INVESTMENTS)
Lansing Board of Water and Light, Michigan, Steam and Electric
Utility System Revenue Bonds,Series 2008A:
215 5.000%, 7/01/28 7/18 at 100.00 AA- 225,759
5,000 5.000%, 7/01/32 7/18 at 100.00 AA- 5,137,049
3,000 Michigan Public Power Agency, Revenue Bonds, Combustion Turbine 1/12 at 100.00 A2 3,042,990
1 Project, Series 2001A, 5.250%, 1/01/27 - AMBAC Insured
3,225 Michigan South Central Power Agency, Power Supply System No Opt. Call A3 3,445,010
Revenue Bonds, Series 2000, 6.000%, 5/01/12
1,000 Michigan Strategic Fund, Collateralized Limited Obligation 3/10 at 102.00 A 1,000,710
Pollution Control Revenue Refunding Bonds, Detroit Edison
Company, Series 1999A, 5.550%, 9/01/29 - NPFG Insured
(Alternative Minimum Tax)
4,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/11 at 100.00 A2 4,017,800
Pollution Control Revenue Refunding Bonds, Detroit Edison
Company, Series 2001C, 5.450%, 9/01/29
2,050 Michigan Strategic Fund, Limited Obligation Pollution Control No Opt. Call Baa1 2,107,564
Revenue Refunding Bonds, Detroit Edison Company, Series
1995CC, 4.850%, 9/01/30 (Mandatory put 9/01/11) - AMBAC
Insured
3,630 Michigan Strategic Fund, Limited Obligation Revenue Refunding No Opt. Call A2 4,355,274
Bonds, Detroit Edison Company, Series 1991BB, 7.000%, 5/01/21
- AMBAC Insured
3,000 Michigan Strategic Fund, Limited Obligation Revenue Refunding 12/12 at 100.00 Baa1 2,842,440
Bonds, Detroit Edison Company, Series 2002C, 5.450%, 12/15/32
- SYNCORA GTY Insured (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
25,120 Total Utilities 26,174,596
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 11.1% (7.3% OF TOTAL INVESTMENTS)
5,500 Detroit Water Supply System, Michigan, Water Supply System 7/16 at 100.00 AAA 5,511,493
Revenue Bonds, Series 2006A, 5.000%, 7/01/34 - AGM Insured
1,500 Detroit, Michigan, Senior Lien Sewerage Disposal System Revenue No Opt. Call A 1,515,240
Bonds, Series 2001B, 5.500%, 7/01/29 - FGIC Insured
565 Detroit, Michigan, Senior Lien Sewerage Disposal System Revenue 7/13 at 100.00 AAA 587,357
Bonds, Series 2003A, 5.000%, 7/01/17 - AGM Insured
1,500 Detroit, Michigan, Senior Lien Water Supply System Revenue 7/13 at 100.00 A+ 1,510,470
Bonds, Series 2003A, 5.000%, 7/01/25 - NPFG Insured
675 Grand Rapids, Michigan, Sanitary Sewer System Revenue Bonds, 1/18 at 100.00 AA+ 692,577
Series 2008, 5.000%, 1/01/38
2,030 Grand Rapids, Michigan, Water Supply System Revenue Bonds, 1/19 at 100.00 AAA 2,102,979
Series 2009, 5.100%, 1/01/39 - AGC Insured
30 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER (continued)
$ 4,210 Michigan Municipal Bond Authority, Clean Water Revolving Fund 10/14 at 100.00 AAA $ 4,684,426
Revenue Bonds, Series 2004, 5.000%, 10/01/19
1,150 Michigan Municipal Bond Authority, Drinking Water Revolving 10/14 at 100.00 AAA 1,218,368
Fund Revenue Bonds, Series 2004, 5.000%, 10/01/23
1,000 Michigan Municipal Bond Authority, Water Revolving Fund Revenue 10/17 at 100.00 AAA 1,087,100
Bonds, Series 2007, 5.000%, 10/01/24
-----------------------------------------------------------------------------------------------------------------------------------
18,130 Total Water and Sewer 18,910,010
-----------------------------------------------------------------------------------------------------------------------------------
$ 281,169 Total Investments (cost $248,315,094) - 151.1% 258,410,792
=============----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (2.1)% (3,630,000)
-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.1% 3,527,698
-------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (51.1)% (5) (87,325,000)
-------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 170,983,490
===================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 33.8%.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction. See Notes to Financial Statements, Footnote 1 - Inverse
Floating Rate Securities for more information.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 31
NMP | Nuveen Michigan Premium Income Municipal Fund, Inc.
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 2.2% (1.5% OF TOTAL INVESTMENTS)
$ 2,625 Michigan Tobacco Settlement Finance Authority, Tobacco 6/18 at 100.00 Baa3 $ 2,411,378
Settlement Asset-Backed Revenue Bonds, Series 2008A, 6.875%,
6/01/42
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 1.8% (1.2% OF TOTAL
INVESTMENTS)
2,000 Michigan Higher Education Student Loan Authority, Revenue Bonds, 9/12 at 100.00 AA 2,012,600
Series 2002 XVII-G, 5.200%, 9/01/20 - AMBAC Insured
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 13.2% (8.9% OF TOTAL INVESTMENTS)
2,725 Michigan State Hospital Finance Authority, Hospital Revenue 11/19 at 100.00 A1 2,671,481
Bonds, Henry Ford Health System, Refunding Series 2009,
5.750%, 11/15/39
3,050 Michigan State Hospital Finance Authority, Hospital Revenue 4/13 at 100.00 A 3,008,520
Bonds, Oakwood Obligated Group, Series 2002A, 5.750%, 4/01/32
1,350 Michigan State Hospital Finance Authority, Hospital Revenue 6/19 at 100.00 AAA 1,408,725
Bonds, Mid-Michigan Obligated Group, Series 2009A, 5.875%,
6/01/39 - AGC Insured
Michigan State Hospital Finance Authority, Revenue Bonds,
Marquette General Hospital, Series 2005A:
1,005 5.000%, 5/15/26 5/15 at 100.00 Baa3 879,847
200 5.000%, 5/15/34 5/15 at 100.00 Baa3 157,124
Michigan State Hospital Finance Authority, Revenue Refunding
Bonds, Detroit Medical Center Obligated Group, Series 1993A:
2,000 6.250%, 8/15/13 8/10 at 100.00 BB- 2,000,200
500 6.500%, 8/15/18 8/10 at 100.00 BB- 494,235
250 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 9/18 at 100.00 A1 295,120
Bonds, William Beaumont Hospital, Refunding Series 2009V,
8.250%, 9/01/39
3,500 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 8/19 at 100.00 A1 3,527,370
and Refunding Bonds, William Beaumont Hospital Obligated
Group, Series 2009W, 6.000%, 8/01/39
-----------------------------------------------------------------------------------------------------------------------------------
14,580 Total Health Care 14,442,622
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 6.5% (4.4% OF TOTAL INVESTMENTS)
875 Michigan Housing Development Authority, GNMA Collateralized 4/12 at 102.00 Aaa 889,875
Limited Obligation Multifamily Housing Revenue Bonds,
Burkshire Pointe Apartments, Series 2002A, 5.400%, 10/20/32
(Alternative Minimum Tax)
1,380 Michigan Housing Development Authority, Limited Obligation 4/10 at 100.00 AAA 1,381,780
Revenue Bonds, Breton Village Green Project, Series 1993,
5.625%, 10/15/18 - AGM Insured
2,070 Michigan Housing Development Authority, Limited Obligation 4/10 at 100.00 AAA 2,073,685
Revenue Bonds, Walled Lake Villa Project, Series 1993,
6.000%, 4/15/18 - AGM Insured
800 Michigan Housing Development Authority, Rental Housing Revenue 7/15 at 100.00 AAA 815,104
Bonds, Series 2006D, 5.125%, 4/01/31 - AGM Insured
(Alternative Minimum Tax)
25 Michigan Housing Development Authority, Rental Housing Revenue 10/18 at 100.00 AA 25,962
Bonds, Series 2009A, 5.700%, 10/01/39
Mt. Clemens Housing Corporation, Michigan, FHA-Insured Section 8
Assisted Multifamily Housing Revenue Refunding Bonds, Clinton
Place Project, Series 1992A:
425 6.600%, 6/01/13 6/10 at 100.00 AA+ 426,411
1,500 6.600%, 6/01/22 6/10 at 100.00 AA+ 1,502,460
-----------------------------------------------------------------------------------------------------------------------------------
7,075 Total Housing/Multifamily 7,115,277
-----------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 0.9% (0.6% OF TOTAL INVESTMENTS)
1,050 Dickinson County Economic Development Corporation, Michigan, 11/14 at 100.00 BBB 1,022,312
Pollution Control Revenue Bonds,
International Paper Company, Series 2004A, 4.800%, 11/01/18
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 57.8% (38.9% OF TOTAL INVESTMENTS)
1,475 Anchor Bay School District, Macomb and St. Clair Counties, 11/13 at 100.00 AA- 1,568,751
Michigan, General Obligation Bonds, Series 2003, 5.000%,
5/01/21
2,500 Anchor Bay School District, Macomb and St. Clair Counties, 5/11 at 100.00 AA- 2,607,875
Michigan, Unlimited Tax General Obligation Refunding Bonds,
Series 2001, 5.000%, 5/01/21
32 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 1,000 Ann Arbor, Michigan, General Obligation Bonds, Court & Police 5/18 at 100.00 AA+ $ 1,044,630
Facilities Capital Improvement Series 2008, 5.000%, 5/01/38
100 Battle Creek School District, Calhoun County, Michigan, General 5/17 at 100.00 AAA 101,014
Obligation Bonds, Series 2007, 5.000%, 5/01/37 - AGM Insured
2,250 Caledonia Community Schools, Kent, Allegan and Barry Counties, 5/15 at 100.00 AA- 2,327,603
Michigan, General Obligation Bonds, Series 2005, 5.000%,
5/01/26 - NPFG Insured
1,501 Caledonia Community Schools, Kent, Allegan and Barry Counties, 5/17 at 100.00 AA- 1,445,808
Michigan, General Obligation Bonds, Tender Option Bond Trust
2008-1096, 8.044%, 5/01/32 - NPFG Insured (IF)
1,725 Charter County of Wayne, Michigan, General Obligation Limited 12/19 at 100.00 A 1,810,250
Tax Building Improvement Bonds, Series 2009, 6.750%, 11/01/39
Detroit City School District, Wayne County, Michigan, General
Obligation Bonds, Series 2002A:
1,815 6.000%, 5/01/20 - FGIC Insured No Opt. Call AA- 2,027,409
750 6.000%, 5/01/21 - FGIC Insured No Opt. Call AA- 844,703
2,500 Detroit City School District, Wayne County, Michigan, General 5/13 at 100.00 AA 2,520,050
Obligation Bonds, Series 2003B, 5.000%, 5/01/23 - FGIC Insured
Detroit-Wayne County Stadium Authority, Michigan, Limited Tax
General Obligation Building
Authority Stadium Bonds, Series 1997:
770 5.500%, 2/01/17 - FGIC Insured 4/10 at 100.00 A 770,932
6,990 5.250%, 2/01/27 - FGIC Insured 8/10 at 100.00 A 6,992,515
860 Grand Rapids, Michigan, General Obligation Bonds, Series 2007, 9/17 at 100.00 AA 931,406
5.000%, 9/01/24 - NPFG Insured
1,500 Hartland Consolidated School District, Livingston County, 5/11 at 100.00 AA- 1,508,670
Michigan, General Obligation Refunding Bonds, Series 2001,
5.125%, 5/01/29
1,650 Holly Area School District, Oakland County, Michigan, General 5/16 at 100.00 AA- 1,681,812
Obligation Bonds, Series 2006, 5.125%, 5/01/32 - NPFG Insured
2,000 Howell Public Schools, Livingston County, Michigan, General 11/13 at 100.00 AA- 2,125,900
Obligation Bonds, Series 2003, 5.000%, 5/01/22
1,250 Kalamazoo Public Schools, Michigan, General Obligation Bonds, 5/16 at 100.00 AAA 1,328,125
Series 2006, 5.000%, 5/01/25 - AGM Insured
500 Lansing School District, Ingham County, Michigan, General 5/14 at 100.00 AA- 531,530
Obligation Bonds, Series 2004, 5.000%, 5/01/22
1,000 Livonia Public Schools, Wayne County, Michigan, General 5/14 at 100.00 AA- 1,051,850
Obligation Bonds, Series 2004A, 5.000%, 5/01/21 - NPFG Insured
865 Lowell Area Schools, Counties of Ionia and Kent, Michigan, 5/17 at 100.00 AAA 873,771
General Obligation Bonds, Series 2007, 5.000%, 5/01/37 - AGM
Insured
425 Marshall Public Schools, Calhoun County, Michigan, General 5/17 at 100.00 AA- 434,745
Obligation Bonds, Series 2007, 5.000%, 5/01/30 - SYNCORA GTY
Insured
1,000 Michigan Municipal Bond Authority, General Obligation Bonds, 6/15 at 100.00 AAA 1,084,750
Detroit City School District, Series 2005, 5.000%, 6/01/18 -
AGM Insured
Michigan, General Obligation Bonds, Environmental Protection
Program, Series 2003A:
1,000 5.250%, 5/01/20 5/13 at 100.00 AA- 1,062,410
2,000 5.250%, 5/01/21 5/13 at 100.00 AA- 2,114,380
800 Michigan, General Obligation Bonds, Environmental Protection 5/19 at 100.00 AA- 880,416
Program, Series 2009A, 5.500%, 11/01/25
2,450 Oakland Intermediate School District, Oakland County, Michigan, 5/17 at 100.00 AAA 2,513,725
General Obligation Bonds, Series 2007, 5.000%, 5/01/36 - AGM
Insured
3,500 Ottawa County, Michigan, Water Supply System, General Obligation 8/17 at 100.00 Aa1 3,652,040
Bonds, Series 2007, 5.000%, 8/01/30 - NPFG Insured (UB)
1,100 Oxford Area Community Schools, Oakland and Lapeer Counties, 5/14 at 100.00 AAA 1,148,224
Michigan, General Obligation Bonds, Series 2004, 5.000%,
5/01/25 - AGM Insured
805 Parchment School District, Kalamazoo County, Michigan, General 5/17 at 100.00 AAA 745,712
Obligation Bonds, Tender Option Bond Trust 2836, 11.153%,
5/01/36 - AGM Insured (IF)
1,000 Rockford Public Schools, Kent County, Michigan, General 5/15 at 100.00 AAA 1,035,430
Obligation Bonds, Series 2005, 5.000%, 5/01/27 - AGM Insured
Nuveen Investments 33
NMP | Nuveen Michigan Premium Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 1,000 Rockford Public Schools, Kent County, Michigan, General 5/18 at 100.00 AAA $ 1,016,040
Obligation Bonds, Series 2008, 5.000%, 5/01/33 - AGM Insured
125 South Haven, Van Buren County, Michigan, General Obligation 12/19 at 100.00 AAA 128,816
Bonds, Capital Improvement Series 2009, 5.125%, 12/01/33 -
AGC Insured
1,100 Thornapple Kellogg School District, Barry County, Michigan, 5/17 at 100.00 AA- 1,115,829
General Obligation Bonds, Series 2007, 5.000%, 5/01/32 - NPFG
Insured
1,500 Trenton Public Schools District, Michigan, General Obligation 5/18 at 100.00 AAA 1,521,015
Bonds, Series 2008, 5.000%, 5/01/34 - AGM Insured
Van Dyke Public Schools, Macomb County, Michigan, General
Obligation Bonds, School Building and Site, Series 2008:
800 5.000%, 5/01/31 - AGM Insured 5/18 at 100.00 AAA 821,560
1,350 5.000%, 5/01/38 - AGM Insured 5/18 at 100.00 AAA 1,367,996
2,830 Warren Consolidated School District, Macomb and Oakland 5/13 at 100.00 AA- 2,960,067
Counties, Michigan, General Obligation Refunding Bonds,
Series 2003, 5.250%, 5/01/20
Wayne County, Michigan, Limited Tax General Obligation Airport
Hotel Revenue Bonds, Detroit Metropolitan Wayne County
Airport, Series 2001A:
1,500 5.500%, 12/01/18 - NPFG Insured 12/11 at 101.00 A 1,536,075
4,435 5.000%, 12/01/30 - NPFG Insured 12/11 at 101.00 A 4,079,757
-----------------------------------------------------------------------------------------------------------------------------------
61,721 Total Tax Obligation/General 63,313,591
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 20.8% (14.0% OF TOTAL INVESTMENTS)
2,880 Michigan Building Authority, Revenue Bonds, Series 2006IA, 10/16 at 100.00 A+ 2,829,888
5.000%, 10/15/36 - FGIC Insured
Michigan State Building Authority, Revenue Bonds, Facilities
Program, Series 2001I:
2,420 5.500%, 10/15/19 10/11 at 100.00 A+ 2,547,486
6,205 5.000%, 10/15/24 10/11 at 100.00 A+ 6,306,947
1,600 Michigan State Building Authority, Revenue Bonds, Facilities 10/15 at 100.00 A+ 1,617,120
Program, Series 2005II, 5.000%, 10/15/30 - AMBAC Insured
Michigan State Building Authority, Revenue Refunding Bonds,
Facilities Program, Series 2003II:
5,000 5.000%, 10/15/22 - NPFG Insured 10/13 at 100.00 A+ 5,170,649
2,480 5.000%, 10/15/23 - NPFG Insured 10/13 at 100.00 A+ 2,544,108
1,500 Michigan, Comprehensive Transportation Revenue Refunding Bonds, 11/11 at 100.00 AAA 1,594,680
Series 2001A, 5.000%, 11/01/19 - AGM Insured
250 Virgin Islands Public Finance Authority Revenue and Refunding 10/19 at 100.00 BBB 225,430
Bonds (Virgin Islands Matching Fund Loan Notes) Series
2009A-1 (Senior Lien) Series 2009A-2 (Senior Lien), 5.000%,
10/01/39
-----------------------------------------------------------------------------------------------------------------------------------
22,335 Total Tax Obligation/Limited 22,836,308
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 0.2% (0.1% OF TOTAL INVESTMENTS)
230 Kent County, Michigan, Airport Revenue Bonds, Gerald R. Ford 1/17 at 100.00 AAA 236,562
International Airport, Series 2007, 5.000%, 1/01/32
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 12.4% (8.3% OF TOTAL INVESTMENTS) (4)
915 Detroit, Michigan, Second Lien Sewerage Disposal System Revenue 7/15 at 100.00 A (4) 1,068,949
Bonds, Series 2005A, 5.000%, 7/01/30 (Pre-refunded 7/01/15) -
MBIA Insured
1,385 Detroit, Michigan, Senior Lien Water Supply System Revenue 7/11 at 100.00 A+ (4) 1,462,685
Bonds, Series 2001A, 5.250%, 7/01/33 (Pre-refunded 7/01/11) -
FGIC Insured
500 Lansing School District, Ingham County, Michigan, General 5/14 at 100.00 AA- (4) 577,880
Obligation Bonds, Series 2004, 5.000%, 5/01/22 (Pre-refunded
5/01/14)
75 Michigan South Central Power Agency, Power Supply System Revenue No Opt. Call A3 (4) 79,512
Bonds, Series 2000, 6.000%, 5/01/12 (ETM)
1,500 Michigan State Building Authority, Revenue Bonds, Facilities 10/10 at 100.00 A+ (4) 1,548,990
Program, Series 2000I, 5.375%, 6.000%, 10/15/20 (Pre-refunded
10/15/10)
34 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
Michigan State Building Authority, Revenue Bonds, Facilities
Program, Series 2001I:
$ 150 5.500%, 10/15/19 (Pre-refunded 10/15/11) 10/11 at 100.00 A+ (4) $ 162,074
295 5.000%, 10/15/24 (Pre-refunded 10/15/11) 10/11 at 100.00 A+ (4) 316,346
1,500 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 (4) 1,701,105
Refunding Bonds, Henry Ford Health System, Series 2003A,
5.625%, 3/01/17 (Pre-refunded 3/01/13)
500 Michigan State Hospital Finance Authority, Hospital Revenue 11/11 at 101.00 A+ (4) 547,085
Refunding Bonds, Sparrow Obligated Group, Series 2001,
5.625%, 11/15/31 (Pre-refunded 11/15/11)
2,465 Michigan State Hospital Finance Authority, Hospital Revenue 5/10 at 100.00 N/R (4) 2,603,459
Refunding Bonds, St. John's Hospital, Series 1993A, 6.000%,
5/15/13 - AMBAC Insured (ETM)
Michigan State Hospital Finance Authority, Revenue Bonds,
Chelsea Community Hospital, Series 2005:
425 5.000%, 5/15/25 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 496,863
150 5.000%, 5/15/30 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 175,364
1,000 Otsego Public Schools District, Allegan and Kalamazoo Counties, 5/14 at 100.00 AAA 1,155,760
Michigan, General Obligation Bonds, Series 2004, 5.000%,
5/01/25 (Pre-refunded 5/01/14) - AGM Insured
1,425 Walled Lake Consolidated School District, Oakland County, 5/14 at 100.00 AA- (4) 1,661,450
Michigan, General Obligation Bonds, Series 2004, 5.250%,
5/01/20 (Pre-refunded 5/01/14) - MBIA Insured
-----------------------------------------------------------------------------------------------------------------------------------
12,285 Total U.S. Guaranteed 13,557,522
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 15.2% (10.2% OF TOTAL INVESTMENTS)
Lansing Board of Water and Light, Michigan, Steam and Electric
Utility System Revenue Bonds, Series 2008A:
125 5.000%, 7/01/28 7/18 at 100.00 AA- 131,255
2,500 5.000%, 7/01/32 7/18 at 100.00 AA- 2,568,525
1,000 Michigan Public Power Agency, Revenue Bonds, Combustion Turbine 1/12 at 100.00 A2 1,014,330
1 Project, Series 2001A, 5.250%, 1/01/27 - AMBAC Insured
925 Michigan South Central Power Agency, Power Supply System Revenue No Opt. Call A3 988,104
Bonds, Series 2000, 6.000%, 5/01/12
1,000 Michigan Strategic Fund, Collateralized Limited Obligation 3/10 at 102.00 A 1,000,710
Pollution Control Revenue Refunding Bonds, Detroit Edison
Company, Series 1999A, 5.550%, 9/01/29 - NPFG Insured
(Alternative Minimum Tax)
5,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/11 at 100.00 A2 5,022,249
Pollution Control Revenue Refunding Bonds, Detroit Edison
Company, Series 2001C, 5.450%, 9/01/29
3,000 Michigan Strategic Fund, Limited Obligation Pollution Control No Opt. Call Baa1 3,084,240
Revenue Refunding Bonds, Detroit Edison Company, Series
1995CC, 4.850%, 9/01/30 (Mandatory put 9/01/11) - AMBAC
Insured
3,000 Michigan Strategic Fund, Limited Obligation Revenue Refunding 12/12 at 100.00 Baa1 2,842,440
Bonds, Detroit Edison Company, Series 2002C, 5.450%, 12/15/32
- SYNCORA GTY Insured (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
16,550 Total Utilities 16,651,853
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 17.7% (11.9% OF TOTAL INVESTMENTS)
3,500 Detroit Water Supply System, Michigan, Water Supply System 7/16 at 100.00 AAA 3,507,315
Revenue Bonds, Series 2006A, 5.000%, 7/01/34 - AGM Insured
1,085 Detroit, Michigan, Second Lien Sewerage Disposal System Revenue 7/15 at 100.00 A 1,068,584
Bonds, Series 2005A, 5.000%, 7/01/30 - NPFG Insured
1,500 Detroit, Michigan, Senior Lien Sewerage Disposal System Revenue No Opt. Call A 1,515,240
Bonds, Series 2001B, 5.500%, 7/01/29 - FGIC Insured
1,120 Detroit, Michigan, Senior Lien Sewerage Disposal System Revenue 7/13 at 100.00 AAA 1,164,318
Bonds, Series 2003A, 5.000%, 7/01/17 - AGM Insured
1,330 Grand Rapids, Michigan, Sanitary Sewer System Revenue Bonds, 7/15 at 100.00 AA+ 1,370,139
Series 2005, 5.000%, 1/01/30 - NPFG Insured
Nuveen Investments 35
NMP | Nuveen Michigan Premium Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER (continued)
Grand Rapids, Michigan, Sanitary Sewer System Revenue Bonds,
Series 2008:
$ 400 5.000%, 1/01/27 No Opt. Call AA+ $ 426,972
450 5.000%, 1/01/38 1/18 at 100.00 AA+ 461,718
425 Grand Rapids, Michigan, Water Supply System Revenue Bonds, 1/19 at 100.00 AAA 440,279
Series 2009, 5.100%, 1/01/39 - AGC Insured
1,000 Michigan Municipal Bond Authority, Water Revolving Fund Revenue
Bonds, Series 2007, 5.000%, 10/01/24 10/17 at 100.00 AAA 1,087,100
8,245 North Kent Sewer Authority, Michigan, Sewer Revenue Bonds, 11/16 at 100.00 A+ 8,347,155
Series 2006, 5.000%, 11/01/31 - NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
19,055 Total Water and Sewer 19,388,820
-----------------------------------------------------------------------------------------------------------------------------------
$ 159,506 Total Investments (cost $159,438,589) - 148.7% 162,988,845
=============----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (2.1)% (2,330,000)
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.4% 2,660,515
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (49.0)% (5) (53,700,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 109,619,360
====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 32.9%.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction. See Notes to Financial Statements, Footnote 1 - Inverse
Floating Rate Securities for more information.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
36 Nuveen Investments
NZW | Nuveen Michigan Dividend Advantage Municipal Fund
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 1.3% (0.9% OF TOTAL INVESTMENTS)
$ 425 Michigan Tobacco Settlement Finance Authority, Tobacco 6/18 at 100.00 Baa3 $ 390,414
Settlement Asset-Backed Revenue Bonds, Series 2008A,
6.875%, 6/01/42
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 4.1% (2.8% OF TOTAL
INVESTMENTS)
1,150 Michigan Higher Education Facilities Authority, Limited 9/11 at 100.00 N/R 1,000,017
Obligation Revenue Refunding Bonds, Kettering University,
Series 2001, 5.000%, 9/01/26 - AMBAC Insured
250 Michigan Public Educational Facilities Authority, Charter 12/17 at 100.00 N/R 206,260
School Revenue Bonds, American Montessori Academy, Series
2007, 6.500%, 12/01/37
-----------------------------------------------------------------------------------------------------------------------------------
1,400 Total Education and Civic Organizations 1,206,277
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 14.7% (9.8% OF TOTAL INVESTMENTS)
475 Michigan State Hospital Finance Authority, Hospital Revenue 11/19 at 100.00 A1 465,671
Bonds, Henry Ford Health System, Refunding Series 2009,
5.750%, 11/15/39
775 Michigan State Hospital Finance Authority, Hospital Revenue 4/13 at 100.00 A 764,460
Bonds, Oakwood Obligated Group, Series 2002A, 5.750%,
4/01/32
150 Michigan State Hospital Finance Authority, Hospital Revenue 6/19 at 100.00 AAA 156,525
Bonds, Mid-Michigan Obligated Group, Series 2009A, 5.875%,
6/01/39 - AGC Insured
515 Michigan State Hospital Finance Authority, Hospital Revenue 7/10 at 100.00 BB 515,010
Refunding Bonds, Sinai Hospital, Series 1995, 6.625%,
1/01/16
Michigan State Hospital Finance Authority, Revenue Bonds,
Marquette General Hospital, Series 2005A:
400 5.000%, 5/15/26 5/15 at 100.00 Baa3 350,188
400 5.000%, 5/15/34 5/15 at 100.00 Baa3 314,248
100 Royal Oak Hospital Finance Authority, Michigan, Hospital 9/18 at 100.00 A1 118,048
Revenue Bonds, William Beaumont Hospital, Refunding Series
2009V, 8.250%, 9/01/39
1,700 Royal Oak Hospital Finance Authority, Michigan, Hospital 11/11 at 100.00 A1 1,593,172
Revenue Bonds, William Beaumont Hospital, Series 2001M,
5.250%, 11/15/31 - NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
4,515 Total Health Care 4,277,322
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 7.0% (4.7% OF TOTAL INVESTMENTS)
1,700 Michigan Housing Development Authority, GNMA Collateralized 8/12 at 102.00 Aaa 1,732,453
Limited Obligation Multifamily Housing Revenue Bonds,
Cranbrook Apartments, Series 2001A, 5.400%, 2/20/31
(Alternative Minimum Tax)
200 Michigan Housing Development Authority, Rental Housing 7/15 at 100.00 AAA 203,776
Revenue Bonds, Series 2006D, 5.125%, 4/01/31 - AGM Insured
(Alternative Minimum Tax)
100 Michigan Housing Development Authority, Rental Housing 10/18 at 100.00 AA 103,847
Revenue Bonds, Series 2009A, 5.700%, 10/01/39
-----------------------------------------------------------------------------------------------------------------------------------
2,000 Total Housing/Multifamily 2,040,076
-----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.7% (1.1% OF TOTAL INVESTMENTS)
500 Michigan Strategic Fund, Limited Obligation Revenue Bonds, No Opt. Call BBB 492,965
Republic Services Inc., Series 2001, 4.250%, 8/01/31
(Mandatory put 4/01/14) (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 48.8% (32.6% OF TOTAL INVESTMENTS)
200 Ann Arbor, Michigan, General Obligation Bonds, Court & Police 5/18 at 100.00 AA+ 208,926
Facilities Capital Improvement Series 2008, 5.000%, 5/01/38
437 Caledonia Community Schools, Kent, Allegan and Barry 5/17 at 100.00 AA- 420,932
Counties, Michigan, General Obligation Bonds, Tender
Option Bond Trust 2008-1096, 8.044%, 5/01/32 - NPFG -
Insured (IF)
25 Charter County of Wayne, Michigan, General Obligation Limited 12/19 at 100.00 A 26,236
Tax Building Improvement Bonds, Series 2009, 6.750%,
11/01/39
50 Detroit-Wayne County Stadium Authority, Michigan, Limited Tax 4/10 at 100.00 A 50,061
General Obligation Building Authority Stadium Bonds,
Series 1997, 5.500%, 2/01/17 - FGIC Insured
300 Grand Rapids, Michigan, General Obligation Bonds, Series 9/17 at 100.00 AA 319,503
2007, 5.000%, 9/01/27 - NPFG Insured
Nuveen Investments 37
NZW | Nuveen Michigan Dividend Advantage Municipal Fund (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 940 Huron Valley School District, Oakland and Livingston 11/11 at 100.00 AA- $ 970,550
Counties, Michigan, General Obligation Bonds, Series 2001,
5.000%, 5/01/27
500 Jackson Public Schools, Jackson County, Michigan, General 5/14 at 100.00 AAA 527,655
Obligation School Building and Site Bonds, Series 2004,
5.000%, 5/01/22 - AGM Insured
430 Lowell Area Schools, Counties of Ionia and Kent, Michigan, 5/17 at 100.00 AAA 434,360
General Obligation Bonds, Series 2007, 5.000%, 5/01/37 -
AGM Insured
400 Michigan Municipal Bond Authority, General Obligation Bonds, 6/15 at 100.00 AAA 433,900
Detroit City School District, Series 2005, 5.000%, 6/01/18
- AGM Insured
100 Michigan, General Obligation Bonds, Environmental Protection 5/19 at 100.00 AA- 110,052
Program, Series 2009A, 5.500%, 11/01/25
1,150 Muskegon County, Michigan, Limited Tax General Obligation 7/11 at 100.00 AA 1,178,256
Wastewater Management System 2 Revenue Bonds, Series 2002,
5.000%, 7/01/26 - FGIC Insured
1,410 New Haven Community Schools, Macomb County, Michigan, General 5/16 at 100.00 AAA 1,464,299
Obligation Bonds, Series 2006, 5.000%, 5/01/25 - AGM
Insured
420 Oakland Intermediate School District, Oakland County, 5/17 at 100.00 AAA 430,924
Michigan, General Obligation Bonds, Series 2007, 5.000%,
5/01/36 - AGM Insured
1,000 Ottawa County, Michigan, Water Supply System, General 8/17 at 100.00 Aa1 1,043,440
Obligation Bonds, Series 2007, 5.000%, 8/01/30 - NPFG
Insured (UB)
235 Parchment School District, Kalamazoo County, Michigan, 5/17 at 100.00 AAA 217,692
General Obligation Bonds, Tender Option Bond Trust 2836,
11.153%, 5/01/36 - AGM Insured (IF)
750 Plainwell Community Schools, Allegan County, Michigan, 5/18 at 100.00 AAA 783,735
General Obligation Bonds, School Building & Site, Series
2008, 5.000%, 5/01/28 - AGC Insured
100 Rockford Public Schools, Kent County, Michigan, General 5/18 at 100.00 AAA 101,604
Obligation Bonds, Series 2008, 5.000%, 5/01/33 - AGM
Insured
25 South Haven, Van Buren County, Michigan, General Obligation 12/19 at 100.00 AAA 25,763
Bonds, Capital Improvement Series 2009, 5.125%, 12/01/33 -
AGC Insured
330 Thornapple Kellogg School District, Barry County, Michigan, 5/17 at 100.00 AA- 334,749
General Obligation Bonds, Series 2007, 5.000%, 5/01/32 -
NPFG Insured
100 Trenton Public Schools District, Michigan, General Obligation 5/18 at 100.00 AAA 101,401
Bonds, Series 2008, 5.000%, 5/01/34 - AGM Insured
225 Van Dyke Public Schools, Macomb County, Michigan, General 5/18 at 100.00 AAA 227,999
Obligation Bonds, School Building and Site, Series 2008,
5.000%, 5/01/38 - AGM Insured
Washtenaw County, Michigan, Limited Tax General Obligation
Bonds, Sylvan Township Water and Wastewater System, Series
2001:
500 5.000%, 5/01/19 - NPFG Insured 5/10 at 100.50 AA+ 505,845
800 5.000%, 5/01/20 - NPFG Insured 5/10 at 100.50 AA+ 809,352
1,690 Wayne County, Michigan, Limited Tax General Obligation 12/11 at 101.00 A 1,554,631
Airport Hotel Revenue Bonds, Detroit Metropolitan Wayne
County Airport, Series 2001A, 5.000%, 12/01/30 - NPFG
Insured
500 Wayne Westland Community Schools, Michigan, General 11/14 at 100.00 AAA 565,685
Obligation Bonds, Series 2004, 5.000%, 5/01/17 - AGM
Insured
1,300 Willow Run Community Schools, Washtenaw County, Michigan, 5/11 at 100.00 AA- 1,356,095
General Obligation Bonds, Series 2001, 5.000%, 5/01/21
-----------------------------------------------------------------------------------------------------------------------------------
13,917 Total Tax Obligation/General 14,203,645
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 16.5% (11.1% OF TOTAL INVESTMENTS)
1,100 Grand Rapids Building Authority, Kent County, Michigan, 10/11 at 100.00 AA 1,137,026
Limited Tax General Obligation Bonds, Series 2001, 5.125%,
10/01/26 - NPFG Insured
770 Kalkaska County Hospital Authority, Michigan, Hospital No Opt. Call N/R 802,402
Revenue Bonds, Series 2007, 5.125%, 5/01/14
38 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
Michigan Building Authority, Revenue Bonds, Series 2006IA:
$ 1,520 0.000%, 10/15/28 - FGIC Insured 10/16 at 55.35 AAA $ 548,386
720 5.000%, 10/15/36 - FGIC Insured 10/16 at 100.00 A+ 707,472
1,150 Michigan State Building Authority, Revenue Bonds, Facilities 10/11 at 100.00 A+ 1,168,895
Program, Series 2001I, 5.000%, 10/15/24
500 Virgin Islands Public Finance Authority Revenue and 10/19 at 100.00 BBB 450,860
Refunding Bonds (Virgin Islands Matching Fund Loan Notes)
Series 2009A-1 (Senior Lien) Series 2009A-2 (Senior
Lien), 5.000%, 10/01/39
-----------------------------------------------------------------------------------------------------------------------------------
5,760 Total Tax Obligation/Limited 4,815,041
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 0.9% (0.6% OF TOTAL INVESTMENTS)
250 Wayne County Airport Authority, Michigan, Revenue Refunding No Opt. Call A 265,845
Bonds, Detroit Metropolitan Airport, Series 2007, 5.000%,
12/01/12 - FGIC Insured
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 21.1% (14.1% OF TOTAL INVESTMENTS) (4)
1,000 Detroit City School District, Wayne County, Michigan, 5/12 at 100.00 AAA 1,101,200
Unlimited Tax School Building and Site Improvement Bonds,
Series 2001A, 5.500%, 5/01/21 (Pre-refunded 5/01/12) -
AGM Insured
720 Detroit, Michigan, Senior Lien Sewerage Disposal System 7/13 at 100.00 AAA 813,420
Revenue Bonds, Series 2003A, 5.000%, 7/01/17
(Pre-refunded 7/01/13) - AGM Insured
1,000 Garden City School District, Wayne County, Michigan, General 5/11 at 100.00 AA- (4) 1,055,160
Obligation Refunding Bonds, Series 2001, 5.000%, 5/01/26
(Pre-refunded 5/01/11)
1,000 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/11 at 101.00 AA (4) 1,075,140
Spectrum Health, Series 2001A, 5.250%, 1/15/21
(Pre-refunded 7/15/11)
55 Michigan State Building Authority, Revenue Bonds, Facilities 10/11 at 100.00 A+ (4) 58,980
Program, Series 2001I, 5.000%, 10/15/24 (Pre-refunded
10/15/11)
Michigan State Hospital Finance Authority, Revenue Bonds,
Chelsea Community Hospital, Series 2005:
425 5.000%, 5/15/30 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 496,863
335 5.000%, 5/15/37 (Pre-refunded 5/15/15) 5/15 at 100.00 AAA 391,645
Puerto Rico Public Finance Corporation, Commonwealth
Appropriation Bonds, Series 2002E:
85 6.000%, 8/01/26 (ETM) No Opt. Call BBB- (4) 108,359
615 6.000%, 8/01/26 (ETM) No Opt. Call AAA 784,008
250 Warren Building Authority, Michigan, Limited Tax General 11/10 at 100.00 AA (4) 258,495
Obligation Bonds, Series 2001,
5.150%, 11/01/22 (Pre-refunded 11/01/10) - FGIC Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,485 Total U.S. Guaranteed 6,143,270
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 18.8% (12.6% OF TOTAL INVESTMENTS)
1,115 Lansing Board of Water and Light, Michigan, Steam and 7/13 at 100.00 AAA 1,165,733
Electric Utility System Revenue Bonds, Series 2003A,
5.000%, 7/01/21 - AGM Insured
Lansing Board of Water and Light, Michigan, Steam and
Electric Utility System Revenue Bonds, Series 2008A:
50 5.000%, 7/01/28 7/18 at 100.00 AA- 52,502
750 5.000%, 7/01/32 7/18 at 100.00 AA- 770,558
1,235 Michigan Public Power Agency, Revenue Bonds, Combustion 1/12 at 100.00 A2 1,259,070
Turbine 1 Project, Series 2001A, 5.250%, 1/01/24 - AMBAC
Insured
2,215 Michigan Strategic Fund, Collateralized Limited Obligation 9/11 at 100.00 A2 2,217,189
Pollution Control Revenue Refunding Bonds, Fixed Rate
Conversion, Detroit Edison Company, Series 1999C, 5.650%,
9/01/29 - SYNCORA GTY Insured (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
5,365 Total Utilities 5,465,052
-----------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 39
NZW | Nuveen Michigan Dividend Advantage Municipal Fund (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 14.5% (9.7% OF TOTAL INVESTMENTS)
$ 1,000 Detroit Water Supply System, Michigan, Water Supply System 7/16 at 100.00 AAA $ 1,002,090
Revenue Bonds, Series 2006A, 5.000%, 7/01/34 - AGM Insured
1,000 Detroit, Michigan, Senior Lien Sewerage Disposal System No Opt. Call A 1,010,160
Revenue Bonds, Series 2001B, 5.500%, 7/01/29 - FGIC
Insured
280 Detroit, Michigan, Senior Lien Sewerage Disposal System 7/13 at 100.00 AAA 291,080
Revenue Bonds, Series 2003A, 5.000%, 7/01/17 - AGM Insured
125 Grand Rapids, Michigan, Sanitary Sewer System Revenue Bonds, 1/18 at 100.00 AA+ 128,255
Series 2008, 5.000%, 1/01/38
150 Grand Rapids, Michigan, Water Supply System Revenue Bonds, 1/19 at 100.00 AAA 155,393
Series 2009, 5.100%, 1/01/39 - AGC Insured
1,000 Michigan Municipal Bond Authority, Clean Water Revolving 10/15 at 100.00 AAA 1,095,730
Fund Revenue Bonds, Series 2005, 5.000%, 10/01/19
500 Michigan Municipal Bond Authority, Water Revolving Fund 10/17 at 100.00 AAA 546,670
Revenue Bonds, Series 2007, 5.000%, 10/01/23
-----------------------------------------------------------------------------------------------------------------------------------
4,055 Total Water and Sewer 4,229,378
-----------------------------------------------------------------------------------------------------------------------------------
$ 43,672 Total Investments (cost $42,521,861) - 149.4% 43,529,285
-----------------------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (2.3)% (665,000)
====================================================================================================================
Other Assets Less Liabilities - 1.9% 537,592
====================================================================================================================
Preferred Shares, at Liquidation Value - (49.0)% (5) (14,275,000)
====================================================================================================================
Net Assets Applicable to Common Shares - 100% $ 29,126,877
====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 32.8%.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction. See Notes to Financial Statements, Footnote 1 - Inverse
Floating Rate Securities for more information.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
40 Nuveen Investments
NUO | Nuveen Ohio Quality Income Municipal Fund, Inc.
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 7.5% (5.2% OF TOTAL INVESTMENTS)
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue
Bonds, Senior Lien, Series 2007A-2:
$ 4,735 5.875%, 6/01/30 6/17 at 100.00 BBB $ 4,035,120
1,650 5.750%, 6/01/34 6/17 at 100.00 BBB 1,329,290
8,450 5.875%, 6/01/47 6/17 at 100.00 BBB 6,356,174
120 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 116,399
Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33
-----------------------------------------------------------------------------------------------------------------------------------
14,955 Total Consumer Staples 11,836,983
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 14.7% (10.2% OF TOTAL
INVESTMENTS)
1,650 Ohio Higher Education Facilities Commission, General Revenue 7/16 at 100.00 A+ 1,650,776
Bonds, Kenyon College, Series 2006, 5.000%, 7/01/41
1,750 Ohio Higher Education Facilities Commission, General Revenue 10/13 at 100.00 AA 1,855,053
Bonds, Oberlin College, Series 2003, 5.125%, 10/01/24
1,000 Ohio Higher Education Facilities Commission, Revenue Bonds, 12/15 at 100.00 Baa2 894,630
Wittenberg University, Series 2005, 5.000%, 12/01/29
2,420 Ohio Higher Educational Facilities Commission, General Revenue 12/16 at 100.00 A 2,476,967
Bonds, University of Dayton, 2006 Project, Series 2006,
5.000%, 12/01/30 - AMBAC Insured
1,415 Ohio Higher Educational Facilities Commission, Revenue Bonds, 11/14 at 100.00 AA 1,496,617
Denison University, Series 2004, 5.000%, 11/01/21
1,320 Ohio Higher Educational Facilities Commission, Revenue Bonds, 12/14 at 100.00 A 1,362,781
University of Dayton, Series 2004, 5.000%, 12/01/25 - AMBAC
Insured
1,000 Ohio Higher Educational Facilities Commission, Revenue Bonds, 12/11 at 100.00 Baa2 1,025,240
Wittenberg University, Series 2001, 5.500%, 12/01/15
1,500 Ohio State Higher Education Facilities, Revenue Bonds, Case 12/16 at 100.00 AA- 1,546,305
Western Reserve University, Series 2006, 5.000%, 12/01/44 -
NPFG Insured
1,200 Ohio State University, General Receipts Bonds, Series 2002A, 12/12 at 100.00 AA 1,236,756
5.125%, 12/01/31
3,000 Ohio State University, General Receipts Bonds, Series 2003B, 6/13 at 100.00 AA 3,276,450
5.250%, 6/01/22
1,510 University of Akron, Ohio, General Receipts Bonds, Series 1/13 at 100.00 A2 1,557,157
2003A, 5.000%, 1/01/21 - AMBAC Insured
850 University of Cincinnati, Ohio, General Receipts Bonds, Series 6/13 at 100.00 A+ 879,028
2003C, 5.000%, 6/01/22 - FGIC Insured
University of Cincinnati, Ohio, General Receipts Bonds, Series
2004D:
1,200 5.000%, 6/01/19 - AMBAC Insured 6/14 at 100.00 A+ 1,264,968
2,605 5.000%, 6/01/25 - AMBAC Insured 6/14 at 100.00 A+ 2,690,548
-----------------------------------------------------------------------------------------------------------------------------------
22,420 Total Education and Civic Organizations 23,213,276
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 21.9% (15.2% OF TOTAL INVESTMENTS)
2,000 Akron, Bath and Copley Joint Township Hospital District, Ohio, 5/10 at 101.00 Baa1 1,984,780
Hospital Facilities Revenue Bonds, Summa Health System,
Series 1998A, 5.375%, 11/15/24
3,405 Butler County, Ohio, Hospital Facilities Revenue Bonds, 5/16 at 100.00 N/R 3,343,574
Cincinnati Children's Medical Center Project, Series 2006K,
5.000%, 5/15/31 - FGIC Insured
1,000 Cuyahoga County, Ohio, Hospital Revenue Refunding and 8/10 at 100.00 A 1,001,050
Improvement Bonds, MetroHealth System, Series 1997, 5.625%,
2/15/17 - NPFG Insured
2,000 Cuyahoga County, Ohio, Revenue Refunding Bonds, Cleveland 7/13 at 100.00 Aa2 2,099,720
Clinic Health System, Series 2003A, 6.000%, 1/01/32
3,000 Erie County, Ohio, Hospital Facilities Revenue Bonds, 8/12 at 101.00 A 2,775,180
Firelands Regional Medical Center, Series 2002A, 5.625%,
8/15/32
300 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/19 at 100.00 Aa2 306,603
Children's Hospital Project, Improvement Series 2009,
5.250%, 11/01/40
Nuveen Investments 41
NUO | Nuveen Ohio Quality Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE (continued)
$ 1,000 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/18 at 100.00 Aa2 $ 1,002,720
Children's Hospital Project, Series 2005, 5.000%, 11/01/40
2,455 Hamilton County, Ohio, Revenue Bonds, Children's Hospital 5/14 at 100.00 A 2,624,518
Medical Center, Series 2004J, 5.250%, 5/15/16 - FGIC Insured
1,000 Lorain County, Ohio, Hospital Revenue Bonds, Catholic 10/12 at 100.00 AA- 1,009,950
Healthcare Partners Inc, Refunding Series 2002, 5.375%,
10/01/30
2,000 Lucas County, Ohio, Hospital Revenue Bonds, ProMedica 5/10 at 101.00 N/R 2,013,360
Healthcare Obligated Group, Series 1999, 5.375%, 11/15/29 -
AMBAC Insured
785 Miami County, Ohio, Hospital Facilities Revenue Refunding 5/16 at 100.00 A- 812,703
Bonds, Upper Valley Medical Center Inc., Series 2006,
5.250%, 5/15/21
Montgomery County, Ohio, Revenue Bonds, Catholic Health
Initiatives, Series 2004A:
1,500 5.000%, 5/01/30 5/14 at 100.00 AA 1,523,055
2,500 5.000%, 5/01/32 No Opt. Call AA 2,527,050
1,350 Montgomery County, Ohio, Revenue Bonds, Miami Valley Hospital, 11/14 at 100.00 Aa3 1,417,149
Series 2009A, 6.250%, 11/15/39
1,000 Ohio State Higher Educational Facilities Commission, Hospital 1/15 at 100.00 A 1,063,840
Revenue Bonds, University Hospitals Health System, Series
2009, 6.750%, 1/15/39
2,700 Ohio State, Hospital Facility Revenue Refunding Bonds, 1/19 at 100.00 Aa2 3,175,794
Cleveland Clinic Health System Obligated Group, Tender
Option Bond Trust 3551, 19.967%, 1/01/39 (IF)
830 Richland County, Ohio, Hospital Facilities Revenue Improvement 11/10 at 101.00 A- 843,712
Bonds, MedCentral Health System Obligated Group, Series
2000B, 6.375%, 11/15/30
1,200 Richland County, Ohio, Hospital Revenue Bonds, MidCentral 11/16 at 100.00 A- 1,140,444
Health System Group, Series 2006, 5.250%, 11/15/36
600 Ross County, Ohio, Hospital Revenue Refunding Bonds, Adena 12/18 at 100.00 A 611,100
Health System Series 2008, 5.750%, 12/01/35
1,315 State of Ohio Hospital Revenue Bonds, Series 2008A (Cleveland 1/18 at 100.00 Aa2 1,386,444
Clinic Health System Obligated Group), 5.000%, 1/01/25
1,705 Tuscarawas County, Ohio, Hospital Facilities Revenue Bonds, 10/11 at 101.00 N/R 1,848,203
Union Hospital Project, Series 2001, 5.750%, 10/01/21 - RAAI
Insured
-----------------------------------------------------------------------------------------------------------------------------------
33,645 Total Health Care 34,510,949
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 6.3% (4.4% OF TOTAL INVESTMENTS)
1,385 Clermont County, Ohio, GNMA Collateralized Mortgage Revenue 8/10 at 100.00 Aaa 1,386,288
Bonds, S.E.M. Villa II Project, Series 1994A, 5.950%,
2/20/30
Cuyahoga County, Ohio, GNMA Collateralized Multifamily Housing
Mortgage Revenue Bonds, Longwood Phase One Associates LP,
Series 2001A:
2,475 5.350%, 1/20/21 (Alternative Minimum Tax) 7/11 at 102.00 Aaa 2,531,133
2,250 5.450%, 1/20/31 (Alternative Minimum Tax) 7/11 at 102.00 Aaa 2,276,280
985 Franklin County, Ohio, FHA-Insured Multifamily Housing 7/10 at 100.00 Aa2 985,483
Mortgage Revenue Bonds, Hamilton Creek Apartments Project,
Series 1994A, 5.550%, 7/01/24 (Alternative Minimum Tax)
800 Montgomery County, Ohio, GNMA Guaranteed Multifamily Housing 10/18 at 101.00 Aaa 821,024
Revenue Bonds, Canterbury Court Project, Series 2007,
5.500%, 10/20/42 (Alternative Minimum Tax)
795 Ohio Housing Finance Agency, FHA-Insured Multifamily Housing 6/16 at 102.00 AAA 781,437
Mortgage Revenue Bonds, Madonna Homes, Series 2006M,
4.900%, 6/20/48 (Alternative Minimum Tax)
1,200 Summit County Port Authority, Ohio, Multifamily Housing 9/17 at 102.00 AAA 1,204,164
Revenue Bonds, Callis Tower Apartments Project, Series
2007, 5.250%, 9/20/47 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
9,890 Total Housing/Multifamily 9,985,809
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 2.4% (1.7% OF TOTAL INVESTMENTS)
1,140 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 3/10 at 101.00 Aaa 1,143,021
Program Residential Mortgage Revenue Bonds, Series 1997B,
5.400%, 9/01/29 (Alternative Minimum Tax)
655 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 3/10 at 100.00 Aaa 668,879
Program Residential Mortgage Revenue Bonds, Series 1998A-1,
5.300%, 9/01/19 - AGM Insured (Alternative Minimum Tax)
1,995 Ohio Housing Finance Agency, Single Family Mortgage Revenue 9/15 at 100.00 Aaa 1,989,773
Bonds, Series 2006H, 5.000%,9/01/31 (Alternative Minimum
Tax)
-----------------------------------------------------------------------------------------------------------------------------------
3,790 Total Housing/Single Family 3,801,673
-----------------------------------------------------------------------------------------------------------------------------------
42 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.3% (0.8% OF TOTAL INVESTMENTS)
$ 815 Cleveland-Cuyahoga County Port Authority, Ohio, Development 11/15 at 100.00 N/R $ 716,328
Revenue Bonds, Bond Fund Program - Columbia National Group
Project, Series 2005D, 5.000%, 5/15/20 (Alternative
Minimum Tax)
1,300 Cleveland-Cuyahoga County Port Authority, Ohio, Development 5/10 at 100.00 N/R 1,216,501
Revenue Bonds, Jergens Inc., Series 1998A, 5.375%, 5/15/18
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
2,115 Total Industrials 1,932,829
-----------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 1.4% (0.9% OF TOTAL INVESTMENTS)
2,000 Toledo-Lucas County Port Authority, Ohio, Port Revenue Bonds, No Opt. Call A 2,141,220
Cargill Inc., Series 2004B, 4.500%, 12/01/15
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 38.6% (26.7% OF TOTAL INVESTMENTS)
Butler County, Ohio, General Obligation Bonds, Series 2002:
1,345 5.000%, 12/01/21 - NPFG Insured 12/12 at 100.00 Aa2 1,462,445
1,200 5.000%, 12/01/22 - NPFG Insured 12/12 at 101.00 Aa2 1,291,680
1,500 Centerville City School District, Montgomery County, Ohio, 6/15 at 100.00 Aa2 1,573,740
General Obligation Bonds, Series 2005, 5.000%, 12/01/30 -
AGM Insured
1,000 Central Ohio Solid Waste Authority, General Obligation Bonds, 6/14 at 100.00 AAA 1,119,870
Series 2004A, 5.000%, 12/01/15 - AMBAC Insured
2,600 Cincinnati City School District, Hamilton County, Ohio, 12/12 at 100.00 AAA 2,825,602
General Obligation Bonds, Series 2002, 5.250%, 6/01/21 -
AGM Insured
1,000 Cleveland Municipal School District, Cuyahoga County, Ohio, 6/14 at 100.00 AAA 1,057,750
General Obligation Bonds, Series 2004, 5.000%, 12/01/22 -
AGM Insured
1,200 Cuyahoga County, Ohio, General Obligation Bonds, Series 2004, 12/14 at 100.00 AA+ 1,296,168
5.000%, 12/01/21
1,000 Dayton, Ohio, General Obligation Bonds, Series 2004, 5.250%, 6/14 at 100.00 AA- 1,109,120
12/01/19 - AMBAC Insured
1,000 Dublin City School District, Franklin, Delaware and Union 12/13 at 100.00 AAA 1,086,680
Counties, Ohio, General Obligation Bonds, Series 2003,
5.000%, 12/01/22 - AGM Insured
1,000 Dublin, Ohio, Unlimited Tax Various Purpose Improvement 12/10 at 100.00 Aaa 1,015,620
Bonds, Series 2000A, 5.000%, 12/01/20
1,195 Fairview Park City School District, Cuyahoga County, Ohio, 6/15 at 100.00 A2 1,251,727
General Obligation Bonds, Series 2005, 5.000%, 12/01/24 -
NPFG Insured
1,840 Franklin County, Ohio, General Obligation Bonds, Series 2007, 12/17 at 100.00 AAA 2,003,282
5.000%, 12/01/28
1,500 Green, Ohio, General Obligation Bonds, Series 2008, 5.500%, 12/15 at 100.00 AA 1,582,305
12/01/32
1,355 Grove City, Ohio, General Obligation Bonds, Construction & No Opt. Call Aa2 1,406,029
Improvement Series 2009, 5.125%, 12/01/36
7,020 Hamilton City School District, Ohio, General Obligation 6/17 at 100.00 AAA 7,370,226
Bonds, Series 2007, 5.000%, 12/01/34 - AGM Insured
1,850 Hilliard School District, Franklin County, Ohio, General 12/15 at 100.00 Aa2 1,955,987
Obligation Bonds, School Construction, Series 2005,
5.000%, 12/01/26 - NPFG Insured
3,000 Hilliard School District, Franklin County, Ohio, General 12/16 at 100.00 AA 3,216,660
Obligation Bonds, Series 2006A, 5.000%, 12/01/25 - NPFG
Insured
2,580 Indian Lake Local School District, Logan and Auglaize 6/17 at 100.00 A+ 2,633,354
Counties, Ohio, School Facilities Improvement and
Refunding Bonds, Series 2007, 5.000%, 12/01/34 - NPFG
Insured
1,160 Kenston Local School District, Geauga County, Ohio, General 6/13 at 100.00 Aa3 1,248,462
Obligation Bonds, Series 2003, 5.000%, 12/01/22 - NPFG
Insured
800 Lakewood City School District, Cuyahoga County, Ohio, General 12/17 at 100.00 AA- 861,800
Obligation Bonds, Series 2007, 5.000%, 12/01/25 - FGIC
Insured
2,000 Louisville City School District, Ohio, General Obligation 12/11 at 100.00 A3 2,008,560
Bonds, Series 2001, 5.000%, 12/01/29 - FGIC Insured
505 Marysville Exempted School District, Union County, Ohio, 12/15 at 100.00 AAA 533,957
General Obligation Bonds, Series 2006, 5.000%, 12/01/25 -
AGM Insured
500 Mason City School District, Counties of Warren and Butler, 6/17 at 100.00 Aa1 529,440
Ohio, General Obligation Bonds, Series 2007, 5.000%,
12/01/31
Nuveen Investments 43
NUO | Nuveen Ohio Quality Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 1,515 Massillon City School District, Ohio, General Obligation 12/12 at 100.00 Baa1 $ 1,572,434
Bonds, Series 2003, 5.250%, 12/01/21 - NPFG Insured
1,350 Milford Exempted Village School District, Ohio, General 12/18 at 100.00 A2 1,391,000
Obligation Bonds, Series 2008, 5.250%, 12/01/36
640 New Albany Plain Local School District, Franklin County, 6/12 at 100.00 Aa2 692,992
Ohio, General Obligation Bonds, Series 2002, 5.500%,
12/01/17 - FGIC Insured
1,000 Newark City School District, Licking County, Ohio, General 12/15 at 100.00 A 1,036,370
Obligation Bonds, Series 2005, 5.000%, 12/01/28 - FGIC
Insured
1,000 Northmor Local School District, Morrow County, Ohio, General 11/18 at 100.00 Aa3 1,031,190
Obligation School Facilities Construction and Improvement
Bonds, Series 2008, 5.000%, 11/01/36
3,000 Ohio, General Obligation Bonds, Infrastructure Improvements, 2/13 at 100.00 AA+ 3,137,250
Series 2003F, 5.000%, 2/01/23
1,510 Painesville City School District, Ohio, General Obligation 12/14 at 100.00 A 1,621,136
Bonds, Series 2004, 5.000%, 12/01/22 - FGIC Insured
280 Plain Local School District, Franklin and Licking Counties, 6/11 at 100.00 Aa2 297,640
Ohio, General Obligation Bonds, Series 2000, 6.000%,
12/01/20 - FGIC Insured
1,445 Portage County, Ohio, General Obligation Bonds, Series 2001, 12/11 at 100.00 AA 1,492,208
5.000%, 12/01/27 - FGIC Insured
2,000 Strongsville, Ohio, General Obligation Bonds, Series 2001, 12/11 at 100.00 Aa1 2,135,060
5.000%, 12/01/21 - FGIC Insured
70 Strongsville, Ohio, Limited Tax General Obligation Various 4/10 at 100.00 Aa1 70,311
Purpose Improvement Bonds, Series 1996, 5.950%, 12/01/21
100 Sylvania City School District, Ohio, General Obligation 6/17 at 100.00 AAA 103,905
School Improvement Bonds, Series 1995, 5.250%, 12/01/36 -
AGC Insured
650 Vandalia Butler City School District, Montgomery County, No Opt. Call AA 674,466
Ohio, General Obligation Bonds, School Improvement Series
2009, 5.125%, 12/01/37
Warren City School District, Trumbull County, Ohio, General
Obligation Bonds, Series 2004:
2,515 5.000%, 12/01/20 - FGIC Insured 6/14 at 100.00 AA 2,745,449
1,170 5.000%, 12/01/22 - FGIC Insured 6/14 at 100.00 AA 1,265,531
1,000 West Chester Township, Butler County, Ohio, General 12/13 at 100.00 Aa1 1,036,860
Obligation Bonds, Series 2003, 5.000%, 12/01/28 - NPFG
Insured
-----------------------------------------------------------------------------------------------------------------------------------
57,395 Total Tax Obligation/General 60,744,266
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 15.7% (10.9% OF TOTAL INVESTMENTS)
1,380 Columbus, Ohio, Tax Increment Financing Bonds, Easton 6/14 at 100.00 BBB+ 1,411,243
Project, Series 2004A, 5.000%, 12/01/25 - AMBAC Insured
3,000 Franklin County, Ohio, Excise Tax and Lease Revenue 12/15 at 100.00 Aaa 3,195,000
Anticipation Bonds, Convention Facilities Authority,
Series 2005, 5.000%, 12/01/27 - AMBAC Insured
1,085 Hamilton County Convention Facilities Authority, Ohio, First 6/14 at 100.00 A+ 1,151,934
Lien Revenue Bonds, Series 2004, 5.000%, 12/01/18 - FGIC
Insured
4,600 Hamilton County, Ohio, Sales Tax Bonds, Subordinate Lien, 12/16 at 100.00 A2 4,681,511
Series 2006, 5.000%, 12/01/32 - AMBAC Insured
1,000 Hudson City School District, Ohio, Certificates of 6/14 at 100.00 A1 1,020,690
Participation, Series 2004, 5.000%, 6/01/26 - NPFG Insured
New Albany Community Authority, Ohio, Community Facilities
Revenue Refunding Bonds, Series 2001B:
1,000 5.500%, 10/01/15 - AMBAC Insured 4/12 at 100.00 A2 1,042,850
1,000 5.500%, 10/01/17 - AMBAC Insured 4/12 at 100.00 A2 1,028,370
800 Ohio State Building Authority, State Facilities Bonds, 4/15 at 100.00 AAA 854,584
Administrative Building Fund Projects, Series 2005A,
5.000%, 4/01/25 - AGM Insured
2,645 Ohio State Building Authority, State Facilities Bonds, Adult 4/14 at 100.00 AA 2,994,299
Correctional Building Fund Project, Series 2004A, 5.250%,
4/01/15 - NPFG Insured
1,000 Ohio, State Appropriation Lease Bonds, Mental Health Capital 6/13 at 100.00 AA 1,107,980
Facilities, Series 2003B-II, 5.000%, 6/01/16
44 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
$ 23,215 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ $ 4,773,699
Revenue Bonds, First Subordinate Series 2009A, 0.000%,
8/01/34
7,875 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ 1,503,023
Revenue Bonds, First Subordinate Series 2010A, 0.000%,
8/01/35
-----------------------------------------------------------------------------------------------------------------------------------
48,600 Total Tax Obligation/Limited 24,765,183
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 3.4% (2.3% OF TOTAL INVESTMENTS)
3,000 Dayton, Ohio, Airport Revenue Bonds, James M. Cox 12/13 at 100.00 A- 2,950,710
International Airport, Series 2003C, 5.250%, 12/01/23 -
RAAI Insured (Alternative Minimum Tax)
2,000 Ohio Turnpike Commission, Revenue Refunding Bonds, Series No Opt. Call AA 2,365,740
1998A, 5.500%, 2/15/18 - FGIC Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,000 Total Transportation 5,316,450
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 20.7% (14.3% OF TOTAL INVESTMENTS) (4)
2,030 Butler County, Ohio, General Obligation Judgment Bonds, 12/12 at 101.00 Aa2 (4) 2,293,758
Series 2002, 5.250%, 12/01/21 (Pre-refunded 12/01/12)
1,000 Dayton, Ohio, Airport Revenue Bonds, James M. Cox No Opt. Call A- (4) 1,167,340
International Airport, Series 2005B, 5.000%, 12/01/14 -
SYNCORA GTY Insured (ETM)
2,000 Garfield Heights City School District, Cuyahoga County, Ohio, 12/11 at 100.00 N/R (4) 2,160,920
General Obligation School Improvement Bonds, Series 2001,
5.000%, 12/15/26 (Pre-refunded 12/15/11) - MBIA Insured
1,500 Hamilton County, Ohio, Sewer System Revenue and Improvement 6/10 at 101.00 AA+ (4) 1,537,005
Bonds, Metropolitan Sewer District of Greater Cincinnati,
Series 2000A, 5.750%, 12/01/25 (Pre-refunded 6/01/10) -
MBIA Insured
1,000 Hilliard School District, Ohio, General Obligation School 12/10 at 101.00 AA (4) 1,052,090
Improvement Bonds, Series 2000, 5.750%, 12/01/24
(Pre-refunded 12/01/10) - FGIC Insured
2,000 Lakota Local School District, Butler County, Ohio, Unlimited 6/11 at 100.00 Aa1 (4) 2,119,660
Tax General Obligation School Improvement and Refunding
Bonds, Series 2001, 5.125%, 12/01/26 (Pre-refunded
6/01/11) - FGIC Insured
760 Middletown City School District, Butler County, Ohio, General 12/13 at 100.00 N/R (4) 869,220
Obligation Bonds, Series 2004, 5.000%, 12/01/25
(Pre-refunded 12/01/13) - FGIC Insured
3,000 Montgomery County, Ohio, Hospital Facilities Revenue Bonds, 4/10 at 101.00 A (4) 3,049,020
Kettering Medical Center, Series 1999, 6.750%, 4/01/18
(Pre-refunded 4/01/10)
1,260 Morgan Local School District, Morgan, Muskingum and 12/10 at 101.00 AA (4) 1,326,440
Washington Counties, Ohio, Unlimited Tax General
Obligation School Improvement Bonds, Series 2000, 5.750%,
12/01/22 (Pre-refunded 12/01/10)
460 New Albany Plain Local School District, Franklin County, 6/12 at 100.00 Aa2 (4) 509,919
Ohio, General Obligation Bonds, Series 2002, 5.500%,
12/01/17 (Pre-refunded 6/01/12) - FGIC Insured
1,225 Ohio Water Development Authority, Water Pollution Control 6/15 at 100.00 AAA 1,437,672
Loan Fund Revenue Bonds, Water Quality Project, Series
2005B, 5.000%, 6/01/25 (Pre-refunded 6/01/15)
Olentangy Local School District, Delaware and Franklin
Counties, Ohio, General Obligation Bonds, Series 2004A:
1,315 5.250%, 12/01/23 (Pre-refunded 6/01/14) - FGIC Insured 6/14 at 100.00 AA+ (4) 1,534,329
3,380 5.250%, 12/01/24 (Pre-refunded 6/01/14) - FGIC Insured 6/14 at 100.00 AA+ (4) 3,943,750
1,000 Princeton City School District, Butler County, Ohio, General 12/13 at 100.00 AAA 1,146,500
Obligation Bonds, Series 2003, 5.000%, 12/01/30
(Pre-refunded 12/01/13) - MBIA Insured
1,670 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- (4) 1,759,128
Improvement Bonds, MedCentral Health System Obligated
Group, Series 2000B, 6.375%, 11/15/30 (Pre-refunded
11/15/10)
2,830 Springfield Township, Hamilton County, Ohio, Various Purpose 12/11 at 100.00 Aa3 (4) 3,065,484
Limited Tax General Obligation Bonds, Series 2002, 5.250%,
12/01/27 (Pre-refunded 12/01/11)
1,500 Steubenville, Ohio, Hospital Facilities Revenue Refunding and 10/10 at 100.00 N/R (4) 1,555,575
Improvement Bonds, Trinity Health System, Series 2000,
6.375%, 10/01/20 (Pre-refunded 10/01/10)
2,000 Westerville City School District, Franklin and Delaware 6/11 at 100.00 AA- (4) 2,113,880
Counties, Ohio, Various Purpose General Obligation Bonds,
Series 2001, 5.000%, 12/01/27 (Pre-refunded 6/01/11) -
MBIA Insured
-----------------------------------------------------------------------------------------------------------------------------------
29,930 Total U.S. Guaranteed 32,641,690
-----------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 45
NUO | Nuveen Ohio Quality Income Municipal Fund, Inc. (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 8.1% (5.6% OF TOTAL INVESTMENTS)
$ 2,500 American Municipal Power Ohio Inc., General Revenue Bonds, 2/18 at 100.00 A1 $ 2,532,425
Series 2008, 5.250%, 2/15/43
4,000 American Municipal Power Ohio Inc., Wadsworth, Electric 2/12 at 100.00 A2 4,090,119
System Improvement Revenue Bonds, Series 2002, 5.000%,
2/15/22 - NPFG Insured
Cleveland, Ohio, Public Power System Revenue Bonds, Series
2008B:
2,105 0.000%, 11/15/32 - NPFG Insured No Opt. Call A 617,018
2,155 0.000%, 11/15/34 - NPFG Insured No Opt. Call A 555,796
3,000 Ohio Air Quality Development Authority, Revenue Bonds, JMG 4/10 at 100.00 N/R 2,574,150
Funding Limited Partnership Project, Series 1997, 5.625%,
1/01/23 - AMBAC Insured (Alternative Minimum Tax)
800 Ohio Municipal Electric Generation Agency, Beneficial No Opt. Call A1 285,296
Interest Certificates, Belleville Hydroelectric Project -
Joint Venture 5, Series 2001, 0.000%, 2/15/29 - NPFG
Insured
2,000 Ohio Municipal Electric Generation Agency, Beneficial 2/14 at 100.00 A1 2,059,760
Interest Certificates, Belleville Hydroelectric Project -
Joint Venture 5, Series 2004, 5.000%, 2/15/20 - AMBAC
Insured
-----------------------------------------------------------------------------------------------------------------------------------
16,560 Total Utilities 12,714,564
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 2.6% (1.8% OF TOTAL INVESTMENTS)
430 City of Marysville, Ohio, Water System Mortgage Revenue 12/17 at 100.00 A3 434,377
Bonds, Series 2007, 5.000%, 12/01/32 - AMBAC Insured
1,000 Cleveland, Ohio, Waterworks First Mortgage Revenue Refunding No Opt. Call Aa2 1,160,540
and Improvement Bonds, Series 1993G, 5.500%, 1/01/21 -
NPFG Insured
40 Cleveland, Ohio, Waterworks First Mortgage Revenue Refunding 7/10 at 100.00 Aa2 40,089
and Improvement Bonds, Series 1996H, 5.750%, 1/01/26 -
NPFG Insured
1,220 Hamilton, Ohio, Wastewater System Revenue Bonds, Series 2005, 10/15 at 100.00 Aa3 1,321,370
5.250%, 10/01/22 - AGM Insured
200 Marysville, Ohio, Wastewater Treatment System Revenue Bonds, 12/17 at 100.00 A- 195,578
Series 2007, 5.000%, 12/01/37 - SYNCORA GTY Insured
525 Ohio Water Development Authority, Revenue Bonds, Drinking 6/18 at 100.00 AAA 569,100
Water Assistance Fund, State Match, Series 2008, 5.000%,
6/01/28 - AGM Insured
275 Ohio Water Development Authority, Water Pollution Control 6/15 at 100.00 AAA 301,964
Loan Fund Revenue Bonds, Water Quality Project, Series
2005B, 5.000%, 6/01/25
-----------------------------------------------------------------------------------------------------------------------------------
3,690 Total Water and Sewer 4,023,018
-----------------------------------------------------------------------------------------------------------------------------------
$ 249,990 Total Investments (cost $218,693,518) - 144.6% 227,627,910
=============----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 2,810,933
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (46.4)% (5) (73,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 157,438,843
====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 32.1%.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
46 Nuveen Investments
NXI | Nuveen Ohio Dividend Advantage Municipal Fund
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 5.8% (4.0% OF TOTAL INVESTMENTS)
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series
2007A-2:
$ 1,320 5.875%, 6/01/30 6/17 at 100.00 BBB $ 1,124,891
3,375 5.875%, 6/01/47 6/17 at 100.00 BBB 2,538,708
45 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 43,650
Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33
-----------------------------------------------------------------------------------------------------------------------------------
4,740 Total Consumer Staples 3,707,249
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 9.0% (6.3% OF TOTAL
INVESTMENTS)
700 Ohio Higher Education Facilities Commission, General Revenue 7/16 at 100.00 A+ 700,329
Bonds, Kenyon College, Series 2006, 5.000%, 7/01/41
2,650 Ohio Higher Education Facilities Commission, Revenue Bonds, Ohio 5/12 at 100.00 A3 2,689,166
Northern University, Series 2002, 5.000%, 5/01/22
500 Ohio Higher Education Facilities Commission, Revenue Bonds, 12/15 at 100.00 Baa2 470,565
Wittenberg University, Series 2005, 5.000%, 12/01/24
1,760 Ohio University at Athens, Subordinate Lien General Receipts 6/14 at 100.00 A+ 1,921,269
Bonds, Series 2004, 5.000%, 12/01/20 - NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,610 Total Education and Civic Organizations 5,781,329
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 18.7% (13.1% OF TOTAL INVESTMENTS)
1,385 Butler County, Ohio, Hospital Facilities Revenue Bonds, 5/16 at 100.00 N/R 1,360,015
Cincinnati Children's Medical Center Project, Series 2006K,
5.000%, 5/15/31 - FGIC Insured
1,100 Cuyahoga County, Ohio, Revenue Refunding Bonds, Cleveland Clinic 7/13 at 100.00 Aa2 1,154,846
Health System, Series 2003A, 6.000%, 1/01/32
300 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/19 at 100.00 Aa2 306,603
Children's Hospital Project, Improvement Series 2009, 5.250%,
11/01/40
500 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/18 at 100.00 Aa2 501,360
Children's Hospital Project, Series 2005, 5.000%, 11/01/40
500 Lorain County, Ohio, Hospital Revenue Bonds, Catholic Healthcare 10/12 at 100.00 AA- 504,975
Partners Inc, Refunding Series 2002, 5.375%, 10/01/30
2,200 Lucas County, Ohio, Hospital Revenue Bonds, ProMedica Healthcare 5/10 at 101.00 N/R 2,214,696
Obligated Group, Series 1999, 5.375%, 11/15/29 - AMBAC Insured
330 Miami County, Ohio, Hospital Facilities Revenue Refunding Bonds, 5/16 at 100.00 A- 341,646
Upper Valley Medical Center Inc., Series 2006, 5.250%, 5/15/21
1,000 Montgomery County, Ohio, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 1,015,370
Initiatives, Series 2004A, 5.000%, 5/01/30
375 Montgomery County, Ohio, Revenue Bonds, Miami Valley Hospital, 11/14 at 100.00 Aa3 393,653
Series 2009A, 6.250%, 11/15/39
250 Ohio State Higher Educational Facilities Commission, Hospital 1/15 at 100.00 A 265,960
Revenue Bonds, University Hospitals Health System, Series
2009, 6.750%, 1/15/39
1,350 Ohio State, Hospital Facility Revenue Refunding Bonds, Cleveland 1/19 at 100.00 Aa2 1,587,897
Clinic Health System Obligated Group, Tender Option Bond
Trust 3551, 19.967%, 1/01/39 (IF)
335 Richland County, Ohio, Hospital Facilities Revenue Improvement 11/10 at 101.00 A- 340,534
Bonds, MedCentral Health System Obligated Group, Series
2000B, 6.375%, 11/15/30
500 Richland County, Ohio, Hospital Revenue Bonds, MidCentral Health 11/16 at 100.00 A- 475,185
System Group, Series 2006, 5.250%, 11/15/36
375 Ross County, Ohio, Hospital Revenue Refunding Bonds, Adena 12/18 at 100.00 A 381,938
Health System Series 2008, 5.750%, 12/01/35
State of Ohio Hospital Revenue Bonds, Series 2008A (Cleveland
Clinic Health System Obligated Group):
1,050 5.000%, 1/01/25 1/18 at 100.00 Aa2 1,107,047
90 5.250%, 1/01/33 1/18 at 100.00 Aa2 92,795
-----------------------------------------------------------------------------------------------------------------------------------
11,640 Total Health Care 12,044,520
-----------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 47
NXI | Nuveen Ohio Dividend Advantage Municipal Fund (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 8.9% (6.2% OF TOTAL INVESTMENTS)
$ 1,165 Cleveland-Cuyahoga County Port Authority, Ohio, Lease Revenue 8/15 at 100.00 N/R $ 1,120,206
Bonds, Euclid Avenue Housing Corporation - Fenn Tower
Project, Series 2005, 5.000%, 8/01/23 - AMBAC Insured
350 Montgomery County, Ohio, GNMA Guaranteed Multifamily Housing 10/18 at 101.00 Aaa 359,198
Revenue Bonds, Canterbury Court Project, Series 2007, 5.500%,
10/20/42 (Alternative Minimum Tax)
2,885 Ohio Housing Finance Agency, FHA-Insured Mortgage Revenue Bonds, 4/11 at 102.00 Aa2 2,953,229
Asbury Woods Project, Series 2001A, 5.450%, 4/01/26
320 Ohio Housing Finance Agency, FHA-Insured Multifamily Housing 6/16 at 102.00 AAA 314,541
Mortgage Revenue Bonds, Madonna Homes, Series 2006M, 4.900%,
6/20/48 (Alternative Minimum Tax)
1,000 Summit County Port Authority, Ohio, Multifamily Housing Revenue 9/17 at 102.00 AAA 1,003,470
Bonds, Callis Tower Apartments Project, Series 2007, 5.250%,
9/20/47 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
5,720 Total Housing/Multifamily 5,750,644
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 2.3% (1.6% OF TOTAL INVESTMENTS)
235 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 8/10 at 100.00 Aaa 246,553
Program Residential Mortgage Revenue Bonds, Series 2000C,
6.050%, 3/01/32 (Alternative Minimum Tax)
630 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 8/10 at 100.00 Aaa 668,940
Program Residential Mortgage Revenue Bonds, Series 2000D,
5.450%, 9/01/31 (Alternative Minimum Tax)
45 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 8/10 at 100.00 Aaa 45,504
Program Residential Mortgage Revenue Bonds, Series 2000F,
5.625%, 9/01/16
500 Ohio Housing Finance Agency, Single Family Mortgage Revenue 9/15 at 100.00 Aaa 498,690
Bonds, Series 2006H, 5.000%, 9/01/31 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
1,410 Total Housing/Single Family 1,459,687
-----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 6.8% (4.7% OF TOTAL INVESTMENTS)
1,500 Cleveland-Cuyahoga County Port Authority, Ohio, Common Bond Fund 5/12 at 102.00 N/R 1,429,770
Revenue Bonds, Cleveland Christian Home Project, Series
2002C, 5.950%, 5/15/22
340 Cleveland-Cuyahoga County Port Authority, Ohio, Development 11/15 at 100.00 N/R 298,836
Revenue Bonds, Bond Fund Program - Columbia National Group
Project, Series 2005D, 5.000%, 5/15/20 (Alternative Minimum
Tax)
880 Ohio State Water Development Authority, Solid Waste Revenue 7/12 at 100.00 BBB 888,202
Bonds, Allied Waste Industries, Inc., Series 2007A, 5.150%,
7/15/15 (Alternative Minimum Tax)
1,300 Toledo-Lucas County Port Authority, Ohio, Revenue Refunding No Opt. Call Baa3 1,486,407
Bonds, CSX Transportation Inc., Series 1992, 6.450%, 12/15/21
700 Western Reserve Port Authority, Ohio, Solid Waste Facility 7/17 at 102.00 N/R 246,134
Revenue Bonds, Central Waste Inc., Series 2007A, 6.350%,
7/01/27 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
4,720 Total Industrials 4,349,349
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 24.8% (17.3% OF TOTAL INVESTMENTS)
125 Barberton City School District, Summit County, Ohio, General 6/18 at 100.00 AA 132,375
Obligation Bonds, School Improvement Series 2008, 5.250%,
12/01/31
1,500 Centerville City School District, Montgomery County, Ohio, 6/15 at 100.00 Aa2 1,573,740
General Obligation Bonds, Series 2005, 5.000%, 12/01/30 - AGM
Insured
400 Columbus City School District, Franklin County, Ohio, General No Opt. Call AAA 176,656
Obligation Bonds, Series 2006, 0.000%, 12/01/27 - AGM Insured
500 Cuyahoga County, Ohio, General Obligation Bonds, Series 2004, 12/14 at 100.00 AA+ 540,070
5.000%, 12/01/21
1,355 Franklin County, Ohio, General Obligation Bonds, Series 2007, 12/17 at 100.00 AAA 1,484,823
5.000%, 12/01/27
470 Green, Ohio, General Obligation Bonds, Series 2008, 5.500%, 12/15 at 100.00 AA 495,789
12/01/32
2,550 Hamilton City School District, Ohio, General Obligation Bonds, 6/17 at 100.00 AAA 2,677,219
Series 2007, 5.000%, 12/01/34 - AGM Insured
2,000 Indian Lake Local School District, Logan and Auglaize Counties, 6/17 at 100.00 A+ 2,041,360
Ohio, School Facilities Improvement and Refunding Bonds,
Series 2007, 5.000%, 12/01/34 - NPFG Insured
430 Lakewood City School District, Cuyahoga County, Ohio, General 12/17 at 100.00 AA- 447,931
Obligation Bonds, Series 2007, 5.000%, 12/01/30 - FGIC Insured
48 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 1,005 Marysville Exempted School District, Union County, Ohio, General 12/15 at 100.00 AAA $ 1,062,627
Obligation Bonds, Series 2006, 5.000%, 12/01/25 - AGM Insured
200 Mason City School District, Counties of Warren and Butler, Ohio, 6/17 at 100.00 Aa1 211,776
General Obligation Bonds, Series 2007, 5.000%, 12/01/31
50 Milford Exempted Village School District, Ohio, General 12/18 at 100.00 A2 51,519
Obligation Bonds, Series 2008, 5.250%, 12/01/36
750 Northmor Local School District, Morrow County, Ohio, General 11/18 at 100.00 Aa3 773,393
Obligation School Facilities Construction and Improvement
Bonds, Series 2008, 5.000%, 11/01/36
50 Sylvania City School District, Ohio, General Obligation School 6/17 at 100.00 AAA 51,953
Improvement Bonds, Series 1995, 5.250%, 12/01/36 - AGC Insured
2,415 Troy City School District, Miami County, Ohio, General 12/14 at 100.00 Aa3 2,536,305
Obligation Bonds, Series 2005, 5.000%, 12/01/28 - AGM Insured
50 Vandalia Butler City School District, Montgomery County, Ohio, No Opt. Call AA 51,882
General Obligation Bonds, School Improvement Series 2009,
5.125%, 12/01/37
1,485 West Chester Township, Butler County, Ohio, Various Purpose 11/11 at 101.00 Aa1 1,620,655
Limited Tax General Obligation Refunding Bonds, Series 2001,
5.500%, 12/01/17 - AMBAC Insured
-----------------------------------------------------------------------------------------------------------------------------------
15,335 Total Tax Obligation/General 15,930,073
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 17.5% (12.3% OF TOTAL INVESTMENTS)
125 Cincinnati City School District, Ohio, Certificates of 12/16 at 100.00 AAA 128,620
Participation, Series 2006, 5.000%, 12/15/32 - AGM Insured
50 Delaware County District Library, Delaware, Franklin, Marion, 12/19 at 100.00 A1 50,073
Morrow and Union Counties, Ohio, Library Fund Library
Facilities Notes, Series 2009 (Special Obligation), 5.000%,
12/01/34
2,000 Franklin County, Ohio, Excise Tax and Lease Revenue Anticipation 12/15 at 100.00 Aaa 2,130,000
Bonds, Convention Facilities Authority, Series 2005, 5.000%,
12/01/27 - AMBAC Insured
1,415 Hamilton County Convention Facilities Authority, Ohio, First 6/14 at 100.00 A+ 1,479,482
Lien Revenue Bonds, Series 2004, 5.000%, 12/01/21 - FGIC
Insured
2,000 Hamilton County, Ohio, Sales Tax Bonds, Subordinate Lien, Series 12/16 at 100.00 A2 2,035,440
2006, 5.000%, 12/01/32 - AMBAC Insured
500 New Albany Community Authority, Ohio, Community Facilities 4/12 at 100.00 A2 521,425
Revenue Refunding Bonds, Series 2001B, 5.500%, 10/01/15 -
AMBAC Insured
345 Ohio State Building Authority, State Facilities Bonds, 4/15 at 100.00 AAA 368,539
Administrative Building Fund Projects, Series 2005A, 5.000%,
4/01/25 - AGM Insured
1,000 Ohio State Building Authority, State Facilities Bonds, Adult 4/15 at 100.00 AAA 1,065,830
Correctional Building Fund Project, Series 2005A, 5.000%,
4/01/23 - AGM Insured
5,220 Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue No Opt. Call A+ 1,073,389
Bonds, First Subordinate Series 2009A, 0.000%, 8/01/34
5,250 Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue No Opt. Call A+ 1,002,015
Bonds, First Subordinate Series 2010A, 0.000%, 8/01/35
1,400 Virgin Islands Public Finance Authority, Gross Receipts Taxes 10/10 at 101.00 BBB+ 1,427,748
Loan Note, Series 1999A, 6.375%, 10/01/19
-----------------------------------------------------------------------------------------------------------------------------------
19,305 Total Tax Obligation/Limited 11,282,561
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 1.4% (0.9% OF TOTAL INVESTMENTS)
865 Ohio Turnpike Commission, Revenue Bonds, Series 2001A, 5.500%, 2/11 at 100.00 AA 878,191
2/15/26
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 33.5% (23.4% OF TOTAL INVESTMENTS) (4)
1,000 Bay Village City School District, Ohio, General Obligation 12/10 at 100.00 Aa2 (4) 1,036,860
Unlimited Tax School Improvement Bonds, Series 2001, 5.000%,
12/01/25 (Pre-refunded 12/01/10)
1,000 Columbus City School District, Franklin County, Ohio, General 12/14 at 100.00 AAA 1,188,800
Obligation Bonds, Series 2004, 5.500%, 12/01/15 (Pre-refunded
12/01/14) - AGM Insured
Nuveen Investments 49
NXI | Nuveen Ohio Dividend Advantage Municipal Fund (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
$ 1,000 Lakewood City School District, Cuyahoga County, Ohio, General 12/14 at 100.00 AAA $ 1,180,860
Obligation Bonds, Series 2004, 5.250%, 12/01/16 (Pre-refunded
12/01/14) - AGM Insured
2,000 Lakota Local School District, Butler County, Ohio, Unlimited Tax 6/11 at 100.00 Aa1 (4) 2,119,660
General Obligation School Improvement and Refunding Bonds,
Series 2001, 5.125%, 12/01/26 (Pre-refunded 6/01/11) - FGIC
Insured
910 Lebanon, Ohio, Electric System Mortgage Revenue Bonds, Series 12/10 at 101.00 A2 (4) 956,101
2001, 5.500%, 12/01/18 (Pre-refunded 12/01/10) - AMBAC Insured
1,000 Middletown City School District, Butler County, Ohio, General 12/13 at 100.00 N/R (4) 1,143,710
Obligation Bonds, Series 2004, 5.000%, 12/01/25 (Pre-refunded
12/01/13) - FGIC Insured
1,000 Nordonia Hills Local School District, Ohio, General Obligation 12/10 at 101.00 AA (4) 1,050,280
Bonds, Series 2000, 5.450%, 12/01/25 (Pre-refunded 12/01/10) -
AMBAC Insured
2,000 Ohio Higher Educational Facilities Commission, Revenue Bonds, 11/11 at 101.00 AA (4) 2,177,120
Denison University, Series 2001, 5.200%, 11/01/26
(Pre-refunded 11/01/11)
1,000 Ohio Higher Educational Facilities Commission, Revenue Bonds, 12/10 at 101.00 N/R (4) 1,047,720
University of Dayton, Series 2000, 5.500%, 12/01/25
(Pre-refunded 12/01/10) - AMBAC Insured
1,135 Ohio Turnpike Commission, Revenue Bonds, Series 2001A, 5.500%, 2/11 at 100.00 AA (4) 1,192,147
2/15/26 (Pre-refunded 2/15/11)
2,000 Ohio, General Obligation Higher Education Capital Facilities 2/11 at 100.00 AA+ (4) 2,088,060
Bonds, Series 2001A, 5.000%, 2/01/20 (Pre-refunded 2/01/11)
1,900 Olentangy Local School District, Delaware and Franklin Counties, 6/14 at 100.00 AA+ (4) 2,216,901
Ohio, General Obligation Bonds, Series 2004A, 5.250%,
12/01/23 (Pre-refunded 6/01/14) - FGIC Insured
665 Richland County, Ohio, Hospital Facilities Revenue Improvement 11/10 at 101.00 A- (4) 700,491
Bonds, MedCentral Health System Obligated Group, Series
2000B, 6.375%, 11/15/30 (Pre-refunded 11/15/10)
2,735 University of Cincinnati, Ohio, General Receipts Bonds, Series 6/12 at 100.00 A+ (4) 3,022,171
2002F, 5.375%, 6/01/19
400 Westerville City School District, Franklin and Delaware 6/11 at 100.00 AA- (4) 422,776
Counties, Ohio, Various Purpose General Obligation Bonds,
Series 2001, 5.000%, 12/01/27 (Pre-refunded 6/01/11) - MBIA
Insured
-----------------------------------------------------------------------------------------------------------------------------------
19,745 Total U.S. Guaranteed 21,543,657
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 9.8% (6.9% OF TOTAL INVESTMENTS)
American Municipal Power Ohio Inc., General Revenue Bonds,
Series 2008:
50 5.000%, 2/15/38 - AGC Insured 2/18 at 100.00 AAA 51,154
1,000 5.250%, 2/15/43 2/18 at 100.00 A1 1,012,970
1,440 American Municipal Power Ohio Inc., Wadsworth, Electric System 2/12 at 100.00 A2 1,502,510
Improvement Revenue Bonds, Series 2002, 5.250%, 2/15/17 -
NPFG Insured
2,130 Cleveland, Ohio, Public Power System Revenue Bonds, Series No Opt. Call A 624,346
2008B, 0.000%, 11/15/32 - NPFG Insured
2,150 Ohio Air Quality Development Authority, Revenue Refunding Bonds, 5/10 at 100.50 Baa1 2,103,668
Ohio Power Company Project, Series 1999C, 5.150%, 5/01/26 -
AMBAC Insured
1,000 Ohio Municipal Electric Generation Agency, Beneficial Interest 2/14 at 100.00 A1 1,027,080
Certificates, Belleville Hydroelectric Project - Joint
Venture 5, Series 2004, 5.000%, 2/15/21 - AMBAC Insured
-----------------------------------------------------------------------------------------------------------------------------------
7,770 Total Utilities 6,321,728
-----------------------------------------------------------------------------------------------------------------------------------
50 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 4.7% (3.3% OF TOTAL INVESTMENTS)
$ 175 City of Marysville, Ohio, Water System Mortgage Revenue Bonds, 12/17 at 100.00 A3 $ 176,782
Series 2007, 5.000%, 12/01/32 - AMBAC Insured
325 Ohio Water Development Authority, Revenue Bonds, Drinking Water 6/18 at 100.00 AAA 352,300
Assistance Fund, State Match, Series 2008, 5.000%, 6/01/28 -
AGM Insured
2,375 Ohio Water Development Authority, Revenue Bonds, Water 12/13 at 100.00 Aa2 2,478,336
Development Community Assistance Program, Series 2003,
5.000%, 12/01/23 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
2,875 Total Water and Sewer 3,007,418
------------------------------------------------------------------------------------------------------------------------------------
$ 99,735 Total Investments (cost $89,006,604) - 143.2% 92,056,406
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.9% 1,234,089
---------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (45.1)% (5) (29,000,000)
---------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 64,290,495
=====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 31.5%.
N/R Not rated.
(IF) Inverse floating rate investment.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 51
NBJ | Nuveen Ohio Dividend Advantage Municipal Fund 2
| Portfolio of Investments
February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 4.1% (2.9% OF TOTAL INVESTMENTS)
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien,
Series 2007A-2:
$ 250 5.875%, 6/01/30 6/17 at 100.00 BBB $ 213,048
2,200 5.875%, 6/01/47 6/17 at 100.00 BBB 1,654,862
45 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 43,650
Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33
-----------------------------------------------------------------------------------------------------------------------------------
2,495 Total Consumer Staples 1,911,560
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 11.6% (8.0% OF TOTAL
INVESTMENTS)
1,345 Bowling Green State University, Ohio, General Receipts 6/13 at 100.00 A+ 1,473,864
Bonds, Series 2003, 5.250%, 6/01/18 - AMBAC Insured
450 Ohio Higher Education Facilities Commission, General Revenue 7/16 at 100.00 A+ 450,212
Bonds, Kenyon College, Series 2006, 5.000%, 7/01/41
1,050 Ohio Higher Educational Facilities Commission, Revenue 12/11 at 100.00 Baa2 1,076,502
Bonds, Wittenberg University, Series 2001, 5.500%,
12/01/15
1,000 University of Cincinnati, Ohio, General Receipts Bonds, 6/13 at 100.00 A+ 1,034,150
Series 2003C, 5.000%, 6/01/22 - FGIC Insured
1,245 University of Cincinnati, Ohio, General Receipts Bonds, 6/14 at 100.00 A+ 1,312,404
Series 2004D, 5.000%, 6/01/19 - AMBAC Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,090 Total Education and Civic Organizations 5,347,132
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 26.2% (18.1% OF TOTAL INVESTMENTS)
1,090 Butler County, Ohio, Hospital Facilities Revenue Bonds, 5/16 at 100.00 N/R 1,070,336
Cincinnati Children's Medical Center Project, Series
2006K, 5.000%, 5/15/31 - FGIC Insured
300 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/19 at 100.00 Aa2 306,603
Children's Hospital Project, Improvement Series 2009,
5.250%, 11/01/40
250 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/18 at 100.00 Aa2 250,680
Children's Hospital Project, Series 2005, 5.000%, 11/01/40
200 Lorain County, Ohio, Hospital Revenue Bonds, Catholic 10/12 at 100.00 AA- 201,990
Healthcare Partners Inc, Refunding Series 2002, 5.375%,
10/01/30
1,850 Lorain County, Ohio, Hospital Revenue Refunding and 10/11 at 101.00 AA- 1,894,363
Improvement Bonds, Catholic Healthcare Partners, Series
2001A, 5.400%, 10/01/21
900 Lucas County, Ohio, Hospital Revenue Bonds, ProMedica 5/10 at 101.00 N/R 906,012
Healthcare Obligated Group, Series 1999, 5.375%, 11/15/29
- AMBAC Insured
225 Miami County, Ohio, Hospital Facilities Revenue Refunding 5/16 at 100.00 A- 232,940
Bonds, Upper Valley Medical Center Inc., Series 2006,
5.250%, 5/15/21
700 Montgomery County, Ohio, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 710,759
Initiatives, Series 2004A, 5.000%, 5/01/30
90 Montgomery County, Ohio, Revenue Bonds, Miami Valley 11/14 at 100.00 Aa3 94,477
Hospital, Series 2009A, 6.250%, 11/15/39
100 Ohio State Higher Educational Facilities Commission, 1/15 at 100.00 A 106,384
Hospital Revenue Bonds, University Hospitals Health
System, Series 2009, 6.750%, 1/15/39
1,000 Ohio State, Hospital Facility Revenue Refunding Bonds, 1/19 at 100.00 Aa2 1,176,220
Cleveland Clinic Health System Obligated Group, Tender
Option Bond Trust 3551, 19.967%, 1/01/39 (IF)
665 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 675,986
Improvement Bonds, MedCentral Health System Obligated
Group, Series 2000B, 6.375%, 11/15/30
350 Richland County, Ohio, Hospital Revenue Bonds, MidCentral 11/16 at 100.00 A- 332,630
Health System Group, Series 2006, 5.250%, 11/15/36
90 Ross County, Ohio, Hospital Revenue Refunding Bonds, Adena 12/18 at 100.00 A 91,665
Health System Series 2008, 5.750%, 12/01/35
35 State of Ohio Hospital Revenue Bonds, Series 2008A 1/18 at 100.00 Aa2 36,902
(Cleveland Clinic Health System Obligated Group), 5.000%,
1/01/25
52 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE (continued)
$ 3,670 Tuscarawas County, Ohio, Hospital Facilities Revenue Bonds, 10/11 at 101.00 N/R $ 3,978,242
Union Hospital Project, Series 2001, 5.750%, 10/01/26 -
RAAI Insured
-----------------------------------------------------------------------------------------------------------------------------------
11,515 Total Health Care 12,066,189
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 5.0% (3.4% OF TOTAL INVESTMENTS)
1,000 Franklin County, Ohio, GNMA Collateralized Multifamily 5/12 at 102.00 Aaa 1,040,140
Housing Mortgage Revenue Bonds, Agler Project, Series
2002A, 5.550%, 5/20/22 (Alternative Minimum Tax)
250 Montgomery County, Ohio, GNMA Guaranteed Multifamily 10/18 at 101.00 Aaa 256,570
Housing Revenue Bonds, Canterbury Court Project, Series
2007, 5.500%, 10/20/42 (Alternative Minimum Tax)
235 Ohio Housing Finance Agency, FHA-Insured Multifamily 6/16 at 102.00 AAA 230,991
Housing Mortgage Revenue Bonds, MadonnaHomes, Series
2006M, 4.900%, 6/20/48 (Alternative Minimum Tax)
750 Summit County Port Authority, Ohio, Multifamily Housing 9/17 at 102.00 AAA 752,603
Revenue Bonds, Callis Tower Apartments Project, Series
2007, 5.250%, 9/20/47 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
2,235 Total Housing/Multifamily 2,280,304
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 2.2% (1.5% OF TOTAL INVESTMENTS)
995 Ohio Housing Finance Agency, Single Family Mortgage Revenue 9/15 at 100.00 Aaa 992,393
Bonds, Series 2006H, 5.000%, 9/01/31 (Alternative Minimum
Tax)
-----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 10.8% (7.5% OF TOTAL INVESTMENTS)
3,000 Ohio State Sewage and Solid Waste Disposal Facilities, 11/11 at 100.00 BBB+ 2,983,409
Revenue Bonds, Anheuser-Busch Project, Series 2001,
5.500%, 11/01/35 (Alternative Minimum Tax)
640 Ohio State Water Development Authority, Solid Waste Revenue 7/12 at 100.00 BBB 645,965
Bonds, Allied Waste Industries, Inc., Series 2007A,
5.150%, 7/15/15 (Alternative Minimum Tax)
1,000 Toledo-Lucas County Port Authority, Ohio, Revenue Refunding No Opt. Call Baa3 1,143,390
Bonds, CSX Transportation Inc., Series 1992, 6.450%,
12/15/21
500 Western Reserve Port Authority, Ohio, Solid Waste Facility 7/17 at 102.00 N/R 175,810
Revenue Bonds, Central Waste Inc., Series 2007A, 6.350%,
7/01/27 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
5,140 Total Industrials 4,948,574
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 43.3% (29.9% OF TOTAL INVESTMENTS)
1,700 Butler County, Hamilton, Ohio, Limited Tax General 11/11 at 101.00 A2 1,762,832
Obligation Bonds, One Renaissance Center Acquisition,
Series 2001, 5.000%, 11/01/26 - AMBAC Insured
Cleveland Municipal School District, Cuyahoga County, Ohio,
General Obligation Bonds, Series 2004:
1,000 5.000%, 12/01/15 - AGM Insured 6/14 at 100.00 AAA 1,118,570
1,000 5.000%, 12/01/22 - AGM Insured 6/14 at 100.00 AAA 1,057,750
300 Columbus City School District, Franklin County, Ohio, No Opt. Call AAA 132,492
General Obligation Bonds, Series 2006, 0.000%, 12/01/27
- AGM Insured
400 Cuyahoga County, Ohio, General Obligation Bonds, Series 12/14 at 100.00 AA+ 432,056
2004, 5.000%, 12/01/21
1,000 Franklin County, Ohio, General Obligation Bonds, Series 12/17 at 100.00 AAA 1,095,810
2007, 5.000%, 12/01/27
400 Green, Ohio, General Obligation Bonds, Series 2008, 5.500%, 12/15 at 100.00 AA 421,948
12/01/32
1,905 Hamilton City School District, Ohio, General Obligation 6/17 at 100.00 AAA 2,000,040
Bonds, Series 2007, 5.000%, 12/01/34 - AGM Insured
1,000 Indian Lake Local School District, Logan and Auglaize 6/17 at 100.00 A+ 1,020,680
Counties, Ohio, School Facilities Improvement and
Refunding Bonds, Series 2007, 5.000%, 12/01/34 - NPFG
Insured
345 Lakewood City School District, Cuyahoga County, Ohio, 12/17 at 100.00 AA- 359,387
General Obligation Bonds, Series 2007, 5.000%, 12/01/30
- FGIC Insured
2,420 Lorain County, Ohio, Limited Tax General Obligation Justice 12/12 at 100.00 Aa3 2,624,634
Center Bonds, Series 2002, 5.500%,12/01/22 - FGIC Insured
1,005 Marysville Exempted School District, Union County, Ohio, 12/15 at 100.00 AAA 1,062,627
General Obligation Bonds, Series 2006, 5.000%, 12/01/25 -
AGM Insured
200 Mason City School District, Counties of Warren and Butler, 6/17 at 100.00 Aa1 211,776
Ohio, General Obligation Bonds, Series 2007, 5.000%, 12/01/31
Nuveen Investments 53
NBJ | Nuveen Ohio Dividend Advantage Municipal Fund 2 (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 50 Milford Exempted Village School District, Ohio, General 12/18 at 100.00 A2 $ 51,519
Obligation Bonds, Series 2008, 5.250%, 12/01/36
2,665 Newark City School District, Licking County, Ohio, General 12/15 at 100.00 A 2,761,925
Obligation Bonds, Series 2005, 5.000%, 12/01/28 - FGIC
Insured
400 Northmor Local School District, Morrow County, Ohio, 11/18 at 100.00 Aa3 412,476
General Obligation School Facilities Construction and
Improvement Bonds, Series 2008, 5.000%, 11/01/36
1,960 Portage County, Ohio, General Obligation Bonds, Series 12/11 at 100.00 AA 2,074,523
2001, 5.000%, 12/01/25 - FGIC Insured
1,000 Powell, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 AA+ 1,054,900
5.500%, 12/01/25 - FGIC Insured
50 Sylvania City School District, Ohio, General Obligation 6/17 at 100.00 AAA 51,953
School Improvement Bonds, Series 1995, 5.250%, 12/01/36
- AGC Insured
200 Vandalia Butler City School District, Montgomery County, No Opt. Call AA 207,528
Ohio, General Obligation Bonds, School Improvement
Series 2009, 5.125%, 12/01/37
-----------------------------------------------------------------------------------------------------------------------------------
19,000 Total Tax Obligation/General 19,915,426
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 14.6% (10.1% OF TOTAL INVESTMENTS)
175 Delaware County District Library, Delaware, Franklin, 12/19 at 100.00 A1 175,256
Marion, Morrow and Union Counties, Ohio, Library Fund
Library Facilities Notes, Series 2009 (Special
Obligation), 5.000%, 12/01/34
1,400 Hamilton County, Ohio, Sales Tax Bonds, Subordinate Lien, 12/16 at 100.00 A2 1,424,808
Series 2006, 5.000%, 12/01/32 - AMBAC Insured
250 Ohio State Building Authority, State Facilities Bonds, 4/15 at 100.00 AAA 267,058
Administrative Building Fund Projects, Series 2005A,
5.000%, 4/01/25 - AGM Insured
1,000 Ohio State Building Authority, State Facilities Bonds, 4/15 at 100.00 AAA 1,065,830
Adult Correctional Building Fund Project, Series 2005A,
5.000%, 4/01/23 - AGM Insured
1,095 Ohio, State Appropriation Lease Bonds, Parks and Recreation 12/13 at 100.00 AA 1,180,322
Capital Facilities, Series 2004A-II, 5.000%, 12/01/18
4,065 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ 835,886
Revenue Bonds, First Subordinate Series 2009A, 0.000%,
8/01/34
3,940 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ 751,988
Revenue Bonds, First Subordinate Series 2010A, 0.000%,
8/01/35
1,000 Summit County Port Authority, Ohio, Revenue Bonds, Civic 12/11 at 100.00 N/R 1,005,740
Theatre Project, Series 2001, 5.500%, 12/01/26 - AMBAC
Insured
-----------------------------------------------------------------------------------------------------------------------------------
12,925 Total Tax Obligation/Limited 6,706,888
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 16.5% (11.4% OF TOTAL INVESTMENTS) (4)
605 Columbus City School District, Franklin County, Ohio, 12/14 at 100.00 AAA 719,224
General Obligation Bonds, Series 2004, 5.500%, 12/01/15
(Pre-refunded 12/01/14) - AGM Insured
1,000 Greater Cleveland Regional Transit Authority, Ohio, General 12/11 at 100.00 Aa3 (4) 1,081,020
Obligation Capital Improvement Bonds, Series 2001A,
5.125%, 12/01/21 (Pre-refunded 12/01/11) - MBIA Insured
2,250 Lebanon City School District, Warren County, Ohio, General 12/11 at 100.00 AAA 2,447,099
Obligation Bonds, Series 2001, 5.500%, 12/01/21
(Pre-refunded 12/01/11) - AGM Insured
1,000 Marysville Exempted Village School District, Ohio, 6/15 at 100.00 N/R (4) 1,186,200
Certificates of Participation, School Facilities
Project, Series 2005, 5.250%, 12/01/21 (Pre-refunded
6/01/15) - MBIA Insured
225 Ohio Water Development Authority, Revenue Bonds, Fresh 12/11 at 100.00 AAA 242,737
Water Development, Series 2001A, 5.000%, 12/01/21
(Pre-refunded 12/01/11) - AGM Insured
1,050 Olentangy Local School District, Delaware and Franklin 6/14 at 100.00 AA+ (4) 1,236,008
Counties, Ohio, General Obligation Bonds, Series 2004A,
5.500%, 12/01/15 (Pre-refunded 6/01/14) - FGIC Insured
635 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- (4) 668,890
Improvement Bonds, MedCentral Health System Obligated
Group, Series 2000B, 6.375%, 11/15/30 (Pre-refunded
11/15/10)
-----------------------------------------------------------------------------------------------------------------------------------
6,765 Total U.S. Guaranteed 7,581,178
-----------------------------------------------------------------------------------------------------------------------------------
54 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 9.5% (6.6% OF TOTAL INVESTMENTS)
$ 1,000 American Municipal Power Ohio Inc., General Revenue Bonds, 2/18 at 100.00 A1 $ 1,012,970
Series 2008, 5.250%, 2/15/43
1,065 Cleveland, Ohio, Public Power System Revenue Bonds, Series No Opt. Call A 312,173
2008B, 0.000%, 11/15/32 - NPFG Insured
2,500 Ohio Air Quality Development Authority, Revenue Refunding 5/10 at 100.50 Baa1 2,446,125
Bonds, Ohio Power Company Project, Series 1999C, 5.150%,
5/01/26 - AMBAC Insured
595 Ohio Municipal Electric Generation Agency, Beneficial 2/14 at 100.00 A1 612,779
Interest Certificates, Belleville Hydroelectric Project
- Joint Venture 5, Series 2004, 5.000%, 2/15/20 - AMBAC
Insured
-----------------------------------------------------------------------------------------------------------------------------------
5,160 Total Utilities 4,384,047
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 0.9% (0.6% OF TOTAL INVESTMENTS)
130 City of Marysville, Ohio, Water System Mortgage Revenue 12/17 at 100.00 A3 131,323
Bonds, Series 2007, 5.000%, 12/01/32 - AMBAC Insured
210 Ohio Water Development Authority, Revenue Bonds, Drinking 6/18 at 100.00 AAA 227,640
Water Assistance Fund, State Match, Series 2008, 5.000%,
6/01/28 - AGM Insured
45 Ohio Water Development Authority, Revenue Bonds, Fresh 12/11 at 100.00 AAA 48,039
Water Development, Series 2001A, 5.000%, 12/01/21 - AGM
Insured
-----------------------------------------------------------------------------------------------------------------------------------
385 Total Water and Sewer 407,002
-----------------------------------------------------------------------------------------------------------------------------------
$ 71,705 Total Investments (cost $64,644,869) - 144.7% 66,540,693
=============----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.3% 1,059,576
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (47.0)% (5) (21,600,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 46,000,269
====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 32.5%.
N/R Not rated.
(IF) Inverse floating rate investment.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 55
NVJ | Nuveen Ohio Dividend Advantage Municipal Fund 3
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 6.7% (4.6% OF TOTAL INVESTMENTS)
Buckeye Tobacco Settlement Financing Authority, Ohio,
Tobacco Settlement Asset-Backed Revenue Bonds, Senior
Lien, Series 2007A-2:
$ 1,100 5.875%, 6/01/30 6/17 at 100.00 BBB $ 937,409
1,670 5.875%, 6/01/47 6/17 at 100.00 BBB 1,256,191
20 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 19,400
Asset-Backed Refunding Bonds, Series 2002, 5.375%,
5/15/33
-----------------------------------------------------------------------------------------------------------------------------------
2,790 Total Consumer Staples 2,213,000
-----------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 6.1% (4.2% OF TOTAL
INVESTMENTS)
350 Ohio Higher Education Facilities Commission, General 7/16 at 100.00 A+ 350,165
Revenue Bonds, Kenyon College, Series 2006, 5.000%,
7/01/41
1,125 Ohio Higher Education Facilities Commission, Revenue 5/12 at 100.00 A3 1,183,196
Bonds, Ohio Northern University, Series 2002, 5.750%,
5/01/16
500 Ohio Higher Education Facilities Commission, Revenue 12/15 at 100.00 Baa2 470,565
Bonds, Wittenberg University, Series 2005, 5.000%,
12/01/24
-----------------------------------------------------------------------------------------------------------------------------------
1,975 Total Education and Civic Organizations 2,003,926
-----------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 20.4% (14.1% OF TOTAL INVESTMENTS)
695 Butler County, Ohio, Hospital Facilities Revenue Bonds, 5/16 at 100.00 N/R 682,462
Cincinnati Children's Medical Center Project, Series
2006K, 5.000%, 5/15/31 - FGIC Insured
600 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/19 at 100.00 Aa2 613,206
Children's Hospital Project, Improvement Series 2009,
5.250%, 11/01/40
250 Franklin County, Ohio, Hospital Revenue Bonds, Nationwide 11/18 at 100.00 Aa2 250,680
Children's Hospital Project, Series 2005, 5.000%,
11/01/40
300 Lorain County, Ohio, Hospital Revenue Bonds, Catholic 10/12 at 100.00 AA- 302,985
Healthcare Partners Inc, Refunding Series 2002, 5.375%,
10/01/30
500 Lucas County, Ohio, Hospital Revenue Bonds, ProMedica 5/10 at 101.00 N/R 503,340
Healthcare Obligated Group, Series 1999, 5.375%,
11/15/29 - AMBAC Insured
160 Miami County, Ohio, Hospital Facilities Revenue Refunding 5/16 at 100.00 A- 165,646
Bonds, Upper Valley Medical Center Inc., Series 2006,
5.250%, 5/15/21
500 Montgomery County, Ohio, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 507,685
Initiatives, Series 2004A, 5.000%, 5/01/30
60 Montgomery County, Ohio, Revenue Bonds, Miami Valley 11/14 at 100.00 Aa3 62,984
Hospital, Series 2009A, 6.250%, 11/15/39
1,500 Ohio State Higher Educational Facilities Commission, 1/15 at 100.00 A 1,595,760
Hospital Revenue Bonds, University Hospitals Health
System, Series 2009, 6.750%, 1/15/39
675 Ohio State, Hospital Facility Revenue Refunding Bonds, 1/19 at 100.00 Aa2 793,949
Cleveland Clinic Health System Obligated Group, Tender
Option Bond Trust 3551, 19.967%, 1/01/39 (IF)
335 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 340,534
Improvement Bonds, MedCentral Health System Obligated
Group, Series 2000B, 6.375%, 11/15/30
250 Richland County, Ohio, Hospital Revenue Bonds, MidCentral 11/16 at 100.00 A- 237,593
Health System Group, Series 2006, 5.250%, 11/15/36
60 Ross County, Ohio, Hospital Revenue Refunding Bonds, Adena 12/18 at 100.00 A 61,110
Health System Series 2008, 5.750%, 12/01/35
600 State of Ohio Hospital Revenue Bonds, Series 2008A 1/18 at 100.00 Aa2 632,598
(Cleveland Clinic Health System Obligated Group),
5.000%, 1/01/25
-----------------------------------------------------------------------------------------------------------------------------------
6,485 Total Health Care 6,750,532
-----------------------------------------------------------------------------------------------------------------------------------
56 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 3.4% (2.4% OF TOTAL INVESTMENTS)
$ 200 Montgomery County, Ohio, GNMA Guaranteed Multifamily 10/18 at 101.00 Aaa $ 205,256
Housing Revenue Bonds, Canterbury Court Project, Series
2007, 5.500%, 10/20/42 (Alternative Minimum Tax)
185 Ohio Housing Finance Agency, FHA-Insured Multifamily 6/16 at 102.00 AAA 181,844
Housing Mortgage Revenue Bonds, Madonna Homes, Series
2006M, 4.900%, 6/20/48 (Alternative Minimum Tax)
750 Summit County Port Authority, Ohio, Multifamily Housing 9/17 at 102.00 AAA 752,603
Revenue Bonds, Callis Tower Apartments Project, Series
2007, 5.250%, 9/20/47 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
1,135 Total Housing/Multifamily 1,139,703
-----------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 3.2% (2.2% OF TOTAL INVESTMENTS)
110 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 115,408
Securities Program Residential Mortgage Revenue Bonds,
Series 2000C, 6.050%, 3/01/32 (Alternative Minimum Tax)
385 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 408,797
Securities Program Residential Mortgage Revenue Bonds,
Series 2000D, 5.450%, 9/01/31 (Alternative Minimum Tax)
45 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 45,504
Securities Program Residential Mortgage
Revenue Bonds, Series 2000F, 5.625%, 9/01/16
500 Ohio Housing Finance Agency, Single Family Mortgage 9/15 at 100.00 Aaa 498,690
Revenue Bonds, Series 2006H, 5.000%, 9/01/31
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
1,040 Total Housing/Single Family 1,068,399
-----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 6.9% (4.8% OF TOTAL INVESTMENTS)
555 Cleveland-Cuyahoga County Port Authority, Ohio, Common 5/12 at 102.00 N/R 529,015
Bond Fund Revenue Bonds, Cleveland Christian Home
Project, Series 2002C, 5.950%, 5/15/22
480 Ohio State Water Development Authority, Solid Waste 7/12 at 100.00 BBB 484,474
Revenue Bonds, Allied Waste Industries, Inc., Series
2007A, 5.150%, 7/15/15 (Alternative Minimum Tax)
1,000 Toledo-Lucas County Port Authority, Ohio, Revenue No Opt. Call Baa3 1,143,390
Refunding Bonds, CSX Transportation Inc., Series 1992,
6.450%, 12/15/21
400 Western Reserve Port Authority, Ohio, Solid Waste Facility 7/17 at 102.00 N/R 140,648
Revenue Bonds, Central Waste Inc., Series 2007A,
6.350%, 7/01/27 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------------
2,435 Total Industrials 2,297,527
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 33.9% (23.4% OF TOTAL
INVESTMENTS)
1,815 Columbus City School District, Franklin County, Ohio, No Opt. Call AAA 801,577
General Obligation Bonds, Series 2006, 0.000%, 12/01/27
- AGM Insured
300 Cuyahoga County, Ohio, General Obligation Bonds, Series 12/14 at 100.00 AA+ 324,042
2004, 5.000%, 12/01/21
1,000 Franklin County, Ohio, General Obligation Bonds, Series 12/17 at 100.00 AAA 1,095,810
2007, 5.000%, 12/01/27
250 Green, Ohio, General Obligation Bonds, Series 2008, 12/15 at 100.00 AA 263,718
5.500%, 12/01/32
1,275 Hamilton City School District, Ohio, General Obligation 6/17 at 100.00 AAA 1,338,610
Bonds, Series 2007, 5.000%, 12/01/34 - AGM Insured
1,000 Indian Lake Local School District, Logan and Auglaize 6/17 at 100.00 A+ 1,020,680
Counties, Ohio, School Facilities Improvement and
Refunding Bonds, Series 2007, 5.000%, 12/01/34 - NPFG
Insured
1,000 Kenston Local School District, Geauga County, Ohio, 6/13 at 100.00 Aa3 1,076,260
General Obligation Bonds, Series 2003, 5.000%, 12/01/22
- NPFG Insured
210 Lakewood City School District, Cuyahoga County, Ohio, 12/17 at 100.00 AA- 226,223
General Obligation Bonds, Series 2007, 5.000%, 12/01/25
- FGIC Insured
1,270 Lorain, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 Baa2 1,274,597
5.125%, 12/01/26 - AMBAC Insured
500 Marysville Exempted School District, Union County, Ohio, 12/15 at 100.00 AAA 528,670
General Obligation Bonds, Series 2006, 5.000%, 12/01/25
- AGM Insured
100 Mason City School District, Counties of Warren and Butler, 6/17 at 100.00 Aa1 105,888
Ohio, General Obligation Bonds, Series 2007, 5.000%,
12/01/31
50 Milford Exempted Village School District, Ohio, General 12/18 at 100.00 A2 51,519
Obligation Bonds, Series 2008, 5.250%, 12/01/36
Nuveen Investments 57
NVJ | Nuveen Ohio Dividend Advantage Municipal Fund 3 (continued)
| Portfolio of Investments February 28, 2010
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 150 Northmor Local School District, Morrow County, Ohio, 11/18 at 100.00 Aa3 $ 154,679
General Obligation School Facilities Construction and
Improvement Bonds, Series 2008, 5.000%,
11/01/36
1,000 Ohio, Common Schools Capital Facilities, General 9/11 at 100.00 AA+ 1,070,060
Obligation Bonds, Series 2001B, 5.000%, 9/15/20
1,130 Solon, Ohio, General Obligation Refunding and Improvement 12/12 at 100.00 AAA 1,246,593
Bonds, Series 2002, 5.000%, 12/01/18
500 Sylvania City School District, Ohio, General Obligation 6/17 at 100.00 AAA 519,525
School Improvement Bonds, Series 1995, 5.250%,
12/01/36 - AGC Insured
100 Vandalia Butler City School District, Montgomery County, No Opt. Call AA 103,764
Ohio, General Obligation Bonds, School Improvement
Series 2009, 5.125%, 12/01/37
-----------------------------------------------------------------------------------------------------------------------------------
11,650 Total Tax Obligation/General 11,202,215
-----------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 13.5% (9.3% OF TOTAL INVESTMENTS)
75 Delaware County District Library, Delaware, Franklin, 12/19 at 100.00 A1 75,110
Marion, Morrow and Union Counties, Ohio, Library Fund
Library Facilities Notes, Series 2009 (Special
Obligation), 5.000%, 12/01/34
1,000 Hamilton County, Ohio, Sales Tax Bonds, Subordinate Lien, 12/16 at 100.00 A2 1,017,720
Series 2006, 5.000%, 12/01/32 - AMBAC Insured
1,000 Midview Local School District, Lorain County, Ohio, 5/13 at 100.00 A 1,008,990
Certificates of Participation, Series 2003, 5.000%,
11/01/30
1,250 Ohio State Building Authority, State Facilities Bonds, 4/12 at 100.00 AAA 1,377,038
Administrative Building Fund Projects, Series 2002A,
5.500%, 4/01/18 - AGM Insured
200 Ohio State Building Authority, State Facilities Bonds, 4/15 at 100.00 AAA 213,646
Administrative Building Fund Projects, Series 2005A,
5.000%, 4/01/25 - AGM Insured
2,000 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ 411,260
Revenue Bonds, First Subordinate Series 2009A, 0.000%,
8/01/34
1,835 Puerto Rico Sales Tax Financing Corporation, Sales Tax No Opt. Call A+ 350,228
Revenue Bonds, First Subordinate Series 2010A, 0.000%,
8/01/35
-----------------------------------------------------------------------------------------------------------------------------------
7,360 Total Tax Obligation/Limited 4,453,992
-----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 5.5% (3.8% OF TOTAL INVESTMENTS)
1,550 Ohio Turnpike Commission, Revenue Refunding Bonds, Series No Opt. Call AA 1,833,449
1998A, 5.500%, 2/15/18 - FGIC Insured
-----------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 36.4% (25.1% OF TOTAL INVESTMENTS) (4)
725 Eaton City School District, Preble County, Ohio, General 12/12 at 101.00 A1 (4) 830,596
Obligation Bonds, Series 2002, 5.750%, 12/01/21
(Pre-refunded 12/01/12) - FGIC Insured
1,300 Granville Exempt Village School District, Ohio, General 12/11 at 100.00 Aa2 (4) 1,411,228
Obligation Bonds, Series 2001, 5.500%, 12/01/28
(Pre-refunded 12/01/11)
1,000 Hilliard, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 AA (4) 1,125,620
5.375%, 12/01/22 (Pre-refunded 12/01/12)
500 Miami East Local School District, Miami County, Ohio, 6/12 at 100.00 AAA 550,295
General Obligation Bonds, Series 2002, 5.125%,
12/01/29 (Pre-refunded 6/01/12) - AGM Insured
1,000 Montgomery County, Ohio, Hospital Facilities Revenue 4/10 at 101.00 A (4) 1,016,340
Bonds, Kettering Medical Center, Series 1999, 6.750%,
4/01/18 (Pre-refunded 4/01/10)
1,000 Montgomery County, Ohio, Revenue Bonds, Catholic Health 9/11 at 100.00 Aa2 (4) 1,071,860
Initiatives, Series 2001, 5.500%, 9/01/12
(Pre-refunded 9/01/11)
2,000 Ohio Higher Education Facilities Commission, Revenue 10/12 at 100.00 N/R (4) 2,242,496
Bonds, Case Western Reserve University, Series 2002B,
5.500%, 10/01/22 (Pre-refunded 10/01/12)
230 Ohio Water Development Authority, Revenue Bonds, Fresh 12/11 at 100.00 AAA 248,131
Water Development, Series 2001A, 5.000%, 12/01/21
(Pre-refunded 12/01/11) - AGM Insured
1,000 Olentangy Local School District, Delaware and Franklin 6/14 at 100.00 AA+ (4) 1,166,790
Counties, Ohio, General Obligation Bonds, Series
2004A, 5.250%, 12/01/21 (Pre-refunded 6/01/14) - FGIC
Insured
1,535 Pickerington Local School District, Fairfield and 12/11 at 100.00 AA- (4) 1,661,883
Franklin Counties, Ohio, General Obligation Bonds,
School Facilities Construction and Improvement, Series
2001, 5.250%, 12/01/20 (Pre-refunded 12/01/11) - FGIC
Insured
665 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- (4) 700,491
Improvement Bonds, MedCentral Health System Obligated
Group, Series 2000B, 6.375%, 11/15/30 (Pre-refunded
11/15/10)
-----------------------------------------------------------------------------------------------------------------------------------
10,955 Total U.S. Guaranteed 12,025,730
-----------------------------------------------------------------------------------------------------------------------------------
58 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 7.7% (5.3% OF TOTAL INVESTMENTS)
$ 500 American Municipal Power Ohio Inc., General Revenue 2/18 at 100.00 A1 $ 506,485
Bonds, Series 2008, 5.250%, 2/15/43
1,500 American Municipal Power Ohio Inc., Wadsworth, Electric 2/12 at 100.00 A2 1,565,115
System Improvement Revenue Bonds, Series 2002, 5.250%,
2/15/17 - NPFG Insured
1,595 Cleveland, Ohio, Public Power System Revenue Bonds, No Opt. Call A 467,526
Series 2008B, 0.000%, 11/15/32 - NPFG Insured
-----------------------------------------------------------------------------------------------------------------------------------
3,595 Total Utilities 2,539,126
-----------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 1.1% (0.8% OF TOTAL INVESTMENTS)
130 City of Marysville, Ohio, Water System Mortgage Revenue 12/17 at 100.00 A3 131,323
Bonds, Series 2007, 5.000%, 12/01/32 - AMBAC Insured
160 Ohio Water Development Authority, Revenue Bonds, Drinking 6/18 at 100.00 AAA 173,440
Water Assistance Fund, State Match, Series 2008,
5.000%, 6/01/28 - AGM Insured
40 Ohio Water Development Authority, Revenue Bonds, Fresh 12/11 at 100.00 AAA 42,701
Water Development, Series 2001A, 5.000%, 12/01/21 - AGM
Insured
------------------------------------------------------------------------------------------------------------------------------------
330 Total Water and Sewer 347,464
------------------------------------------------------------------------------------------------------------------------------------
$ 51,300 Total Investments (cost $45,585,789) - 144.8% 47,875,063
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.1% 686,620
---------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (46.9)% (5) (15,500,000)
---------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 33,061,683
=====================================================================================================================
(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 (not covered by the report of independent
registered public accounting firm): 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(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. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) Preferred Shares, at Liquidation Value as a percentage of Total
Investments is 32.4%.
N/R Not rated.
(IF) Inverse floating rate investment.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 59
| Statement of
| Assets & Liabilities
February 28, 2010
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
--------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $248,315,094, $159,438,589 and $42,521,861,
respectively) $ 258,410,792 $ 162,988,845 $ 43,529,285
Cash 639,855 626,126 65,559
Receivables:
Interest 3,779,173 2,573,340 635,822
Investments sold -- -- --
Other assets 54,595 49,080 12,202
--------------------------------------------------------------------------------------------------------------------------------
Total assets 262,884,415 166,237,391 44,242,868
--------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Floating rate obligations 3,630,000 2,330,000 665,000
Payables:
Investments purchased -- -- --
Common share dividends 686,718 428,884 127,931
Preferred share dividends 2,860 2,089 499
Accrued expenses:
Management fees 126,448 80,540 18,136
Other 129,899 76,518 29,425
--------------------------------------------------------------------------------------------------------------------------------
Total liabilities 4,575,925 2,918,031 840,991
--------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 87,325,000 53,700,000 14,275,000
--------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 170,983,490 $ 109,619,360 $ 29,126,877
================================================================================================================================
Common shares outstanding 11,561,053 7,613,948 2,054,786
================================================================================================================================
Net asset value per Common share outstanding (net assets applicable to Common
shares, divided by Common shares outstanding) $ 14.79 $ 14.40 $ 14.18
================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
--------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 115,611 $ 76,139 $ 20,548
Paid-in surplus 162,163,959 106,838,046 29,127,931
Undistributed (Over-distribution of) net investment income 2,052,752 1,308,096 327,171
Accumulated net realized gain (loss) (3,444,530) (2,153,177) (1,356,197)
Net unrealized appreciation (depreciation) 10,095,698 3,550,256 1,007,424
--------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 170,983,490 $ 109,619,360 $ 29,126,877
================================================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 Unlimited
Preferred 1,000,000 1,000,000 Unlimited
================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
60 Nuveen Investments
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $218,693,518, $89,006,604,
$64,644,869 and $45,585,789, respectively) $ 227,627,910 $ 92,056,406 $ 66,540,693 $ 47,875,063
Cash 1,572,648 787,246 546,751 445,938
Receivables:
Interest 2,888,233 1,235,319 975,914 678,737
Investments sold 190,000 80,000 -- 45,000
Other assets 26,646 12,235 14,898 27,439
---------------------------------------------------------------------------------------------------------------------------------
Total assets 232,305,437 94,171,206 68,078,256 49,072,177
---------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Floating rate obligations -- -- -- --
Payables:
Investments purchased 1,029,795 514,898 205,959 308,939
Common share dividends 622,596 280,748 204,463 151,792
Preferred share dividends 2,573 1,013 1,566 744
Accrued expenses:
Management fees 113,600 38,551 28,373 18,036
Other 98,030 45,501 37,626 30,983
---------------------------------------------------------------------------------------------------------------------------------
Total liabilities 1,866,594 880,711 477,987 510,494
---------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 73,000,000 29,000,000 21,600,000 15,500,000
---------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 157,438,843 $ 64,290,495 $ 46,000,269 $ 33,061,683
=================================================================================================================================
Common shares outstanding 9,746,032 4,243,493 3,121,477 2,156,758
=================================================================================================================================
Net asset value per Common share outstanding (net assets applicable
to Common shares, divided by Common shares outstanding) $ 16.15 $ 15.15 $ 14.74 $ 15.33
=================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
---------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 97,460 $ 42,435 $ 31,215 $ 21,568
Paid-in surplus 147,812,939 60,272,123 44,255,705 30,521,415
Undistributed (Over-distribution of) net investment income 1,981,139 901,121 566,366 459,793
Accumulated net realized gain (loss) (1,387,087) 25,014 (748,841) (230,367)
Net unrealized appreciation (depreciation) 8,934,392 3,049,802 1,895,824 2,289,274
---------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 157,438,843 $ 64,290,495 $ 46,000,269 $ 33,061,683
=================================================================================================================================
Authorized shares:
Common 200,000,000 Unlimited Unlimited Unlimited
Preferred 1,000,000 Unlimited Unlimited Unlimited
=================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 61
| Statement of
| Operations
Year Ended February 28, 2010
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
----------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 12,829,934 $ 8,274,052 $ 2,208,387
----------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 1,632,303 1,039,702 276,922
Preferred shares - auction fees 147,607 90,797 24,150
Preferred shares - dividend disbursing agent fees 20,000 20,000 10,000
Shareholders' servicing agent fees and expenses 17,825 13,590 643
Interest expense on floating rate obligations 36,481 23,416 6,683
Custodian's fees and expenses 52,473 36,012 14,577
Directors'/Trustees' fees and expenses 8,261 5,235 1,383
Professional fees 35,152 25,881 12,056
Shareholders' reports - printing and mailing expenses 46,720 35,008 12,558
Stock exchange listing fees 9,219 9,219 292
Investor relations expense 18,698 12,416 3,413
Other expenses 33,236 22,655 17,931
----------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 2,057,975 1,333,931 380,608
Custodian fee credit (428) (414) (26)
Expense reimbursement -- -- (55,445)
----------------------------------------------------------------------------------------------------------------------
Net expenses 2,057,547 1,333,517 325,137
----------------------------------------------------------------------------------------------------------------------
Net investment income 10,772,387 6,940,535 1,883,250
----------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments (1,126,911) (479,222) (758,274)
Change in net unrealized appreciation (depreciation) of investments 13,314,923 7,688,095 3,453,979
----------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 12,188,012 7,208,873 2,695,705
----------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (440,076) (271,823) (64,791)
----------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from distributions to
Preferred shareholders (440,076) (271,823) (64,791)
----------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares from
operations $ 22,520,323 $ 13,877,585 $ 4,514,164
======================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
62 Nuveen Investments
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
----------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 11,609,090 $ 4,755,381 $ 3,387,808 $ 2,507,309
----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 1,451,275 598,283 429,255 311,526
Preferred shares - auction fees 126,945 51,369 38,503 27,385
Preferred shares - dividend disbursing agent fees 30,000 10,000 10,000 10,000
Shareholders' servicing agent fees and expenses 19,608 1,053 1,150 849
Interest expense on floating rate obligations -- -- -- --
Custodian's fees and expenses 47,414 23,394 18,462 15,320
Directors'/Trustees' fees and expenses 7,365 3,027 2,175 1,568
Professional fees 31,925 16,800 14,405 12,638
Shareholders' reports - printing and mailing expenses 46,726 19,669 16,546 13,648
Stock exchange listing fees 9,219 599 441 305
Investor relations expense 17,075 6,516 4,988 3,674
Other expenses 25,103 19,714 18,693 18,047
----------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 1,812,655 750,424 554,618 414,960
Custodian fee credit (192) (240) (254) (180)
Expense reimbursement -- (96,845) (85,828) (74,684)
----------------------------------------------------------------------------------------------------------------------------------
Net expenses 1,812,463 653,339 468,536 340,096
----------------------------------------------------------------------------------------------------------------------------------
Net investment income 9,796,627 4,102,042 2,919,272 2,167,213
----------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments 363,546 222,662 (18,550) (180,875)
Change in net unrealized appreciation (depreciation) of investments 13,563,229 4,711,810 4,761,551 2,739,661
----------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 13,926,775 4,934,472 4,743,001 2,558,786
----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (380,264) (156,209) (115,975) (83,432)
----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from distributions to
Preferred shareholders (380,264) (156,209) (115,975) (83,432)
----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares from
operations $ 23,343,138 $ 8,880,305 $ 7,546,298 $ 4,642,567
==================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 63
| Statement of
| Changes in Net Assets
MICHIGAN MICHIGAN
QUALITY INCOME (NUM) PREMIUM INCOME (NMP)
--------------------------------------------- ----------------------------------------------
SEVEN SEVEN
YEAR ENDED MONTHS ENDED YEAR ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 10,772,387 $ 6,297,863 $ 10,847,892 $ 6,940,535 $ 4,032,688 $ 6,913,995
Net realized gain (loss) from:
Investments (1,126,911) (1,757,557) (263,137) (479,222) (1,285,668) (512,989)
Forward swaps -- -- -- -- 69,797 (6,970)
Futures contracts -- -- -- -- 41,405 --
Change in net unrealized
appreciation (depreciation) of:
Investments 13,314,923 (5,268,940) (7,931,308) 7,688,095 (3,725,846) (5,009,333)
Forward swaps -- -- -- -- (71,362) 207,726
Futures contracts -- -- -- -- (13,813) 13,813
Distributions to Preferred
shareholders:
From net investment income (440,076) (1,528,357) (2,850,189) (271,823) (911,943) (1,775,079)
From accumulated net realized
gains -- -- (431,262) -- -- (187,020)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from operations 22,520,323 (2,256,991) (628,004) 13,877,585 (1,864,742) (355,857)
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON
SHAREHOLDERS
From net investment income (8,473,599) (4,551,261) (7,897,051) (5,420,952) (2,906,120) (5,138,948)
From accumulated net realized gains -- -- (1,193,754) -- -- (574,353)
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable
to Common shares from
distributions to Common
shareholders (8,473,599) (4,551,261) (9,090,805) (5,420,952) (2,906,120) (5,713,301)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions -- -- -- -- -- --
Repurchased and retired (1,779,734) -- -- (1,271,720) (283,094) --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from capital share
transactions (1,779,734) -- -- (1,271,720) (283,094) --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares 12,266,990 (6,808,252) (9,718,809) 7,184,913 (5,053,956) (6,069,158)
Net assets applicable to Common
shares at the beginning of
period 158,716,500 165,524,752 175,243,561 102,434,447 107,488,403 113,557,561
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $ 170,983,490 $ 158,716,500 $ 165,524,752 $ 109,619,360 $ 102,434,447 $ 107,488,403
====================================================================================================================================
Undistributed (Over-distribution
of) net investment income at
the end of period $ 2,052,752 $ 210,824 $ (7,421) $ 1,308,096 $ 73,500 $ (141,120)
====================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
64 Nuveen Investments
MICHIGAN OHIO
DIVIDEND ADVANTAGE (NZW) QUALITY INCOME (NUO)
------------------------------------------ ----------------------------------------------
SEVEN SEVEN
YEAR ENDED MONTHS ENDED YEAR ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
-----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 1,883,250 $ 1,113,258 $ 1,952,639 $ 9,796,627 $ 5,455,829 $ 9,258,185
Net realized gain (loss) from:
Investments (758,274) (206,695) (97,468) 363,546 (963,174) (894,117)
Forward swaps -- -- -- -- -- (113,636)
Futures contracts -- -- -- -- 348,303 (8,573)
Change in net unrealized
appreciation (depreciation) of:
Investments 3,453,979 (1,840,743) (1,870,613) 13,563,229 (4,408,974) (6,068,561)
Forward swaps -- -- -- -- -- 141,307
Futures contracts -- -- -- -- (101,622) 101,622
Distributions to Preferred
shareholders:
From net investment income (64,791) (265,934) (491,691) (380,264) (1,253,559) (2,439,092)
From accumulated net realized
gains -- (8,429) (48,339) -- -- (235,804)
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from operations 4,514,164 (1,208,543) (555,472) 23,343,138 (923,197) (258,669)
-----------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (1,474,799) (815,426) (1,457,223) (7,787,080) (3,810,698) (6,520,095)
From accumulated net realized gains -- (24,804) (150,270) -- -- (656,883)
-----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (1,474,799) (840,230) (1,607,493) (7,787,080) (3,810,698) (7,176,978)
-----------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions -- -- 8,680 -- -- --
Repurchased and retired (148,424) -- -- -- -- --
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from capital share
transactions (148,424) -- 8,680 -- -- --
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common shares 2,890,941 (2,048,773) (2,154,285) 15,556,058 (4,733,895) (7,435,647)
Net assets applicable to Common
shares at the beginning of period 26,235,936 28,284,709 30,438,994 141,882,785 146,616,680 154,052,327
-----------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $ 29,126,877 $ 26,235,936 $ 28,284,709 $ 157,438,843 $ 141,882,785 $ 146,616,680
-----------------------------------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of)
net investment income at the end
of period $ 327,171 $ (16,421) $ (48,259) $ 1,981,139 $ 355,545 $ 3,336
===================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 65
| Statement of
| Changes in Net Assets (continued)
OHIO OHIO
DIVIDEND ADVANTAGE (NXI) DIVIDEND ADVANTAGE 2 (NBJ)
------------------------------------------ -------------------------------------------
SEVEN SEVEN
YEAR ENDED MONTHS ENDED YEAR ENDED YEAR ENDED MONTHS ENDED YEAR ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
--------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 4,102,042 $ 2,294,907 $ 3,959,340 $ 2,919,272 $ 1,675,202 $ 2,890,350
Net realized gain (loss) from:
Investments 222,662 (160,768) (240,447) (18,550) (424,412) (326,158)
Forward swaps -- 104,696 (31,726) -- -- (45,455)
Futures contracts -- 276,060 (8,580) -- 64,124 --
Change in net unrealized
appreciation (depreciation) of:
Investments 4,711,810 (2,005,025) (2,295,579) 4,761,551 (2,249,194) (1,953,136)
Forward swaps -- (107,042) 220,088 -- -- 56,523
Futures contracts -- (41,291) 41,291 -- (19,976) 19,976
Distributions to Preferred
shareholders:
From net investment income (156,209) (507,674) (974,550) (115,975) (391,035) (790,428)
From accumulated net realized
gains -- -- (133,387) -- -- (67,354)
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from operations 8,880,305 (146,137) 536,450 7,546,298 (1,345,291) (215,682)
--------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (3,281,918) (1,629,732) (2,775,637) (2,300,529) (1,186,161) (2,007,110)
From accumulated net realized gains -- -- (399,794) -- -- (185,104)
--------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (3,281,918) (1,629,732) (3,175,431) (2,300,529) (1,186,161) (2,192,214)
--------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions -- -- -- -- -- --
Repurchased and retired -- (6,912) -- -- -- --
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common
shares from capital share
transactions -- (6,912) -- -- -- --
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets applicable to Common shares 5,598,387 (1,782,781) (2,638,981) 5,245,769 (2,531,452) (2,407,896)
Net assets applicable to Common
shares at the beginning of period 58,692,108 60,474,889 63,113,870 40,754,500 43,285,952 45,693,848
--------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $ 64,290,495 $ 58,692,108 $ 60,474,889 $ 46,000,269 $ 40,754,500 $ 43,285,952
================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the end
of period $ 901,121 $ 250,348 $ 108,618 $ 566,366 $ 65,127 $ (32,879)
================================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
66 Nuveen Investments
OHIO
DIVIDEND ADVANTAGE 3 (NVJ)
-------------------------------------------
SEVEN
YEAR ENDED MONTHS ENDED YEAR ENDED
2/28/10 2/28/09 7/31/08
-----------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 2,167,213 $ 1,194,279 $ 2,053,018
Net realized gain (loss) from:
Investments (180,875) (55,182) (272,641)
Forward swaps -- 104,696 --
Futures contracts -- 173,467 23,859
Change in net unrealized appreciation (depreciation) of:
Investments 2,739,661 (958,880) (1,043,820)
Forward swaps -- (107,042) 107,042
Futures contracts -- (21,252) 9,550
Distributions to Preferred shareholders:
From net investment income (83,432) (265,893) (496,884)
From accumulated net realized gains -- -- (45,494)
------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common
shares from operations 4,642,567 64,193 334,630
------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (1,708,152) (857,987) (1,454,801)
From accumulated net realized gains -- -- (132,313)
------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from
distributions to Common shareholders (1,708,152) (857,987) (1,587,114)
------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from shares issued to shareholders due to
reinvestment of distributions -- -- --
Repurchased and retired -- (20,129) --
------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares
from capital share transactions -- (20,129) --
------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares 2,934,415 (813,923) (1,252,484)
Net assets applicable to Common shares at the beginning of period 30,127,268 30,941,191 32,193,675
------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares at the end of period $ 33,061,683 $ 30,127,268 $ 30,941,191
==================================================================================================================
Undistributed (Over-distribution of) net investment income at
the end of period $ 459,793 $ 87,202 $ 24,308
==================================================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 67
| Notes to
| Financial Statements
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds covered in this report and their corresponding Common share stock
exchange symbols are Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM),
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP), Nuveen Michigan
Dividend Advantage Municipal Fund (NZW), Nuveen Ohio Quality Income Municipal
Fund, Inc. (NUO), Nuveen Ohio Dividend Advantage Municipal Fund (NXI), Nuveen
Ohio Dividend Advantage Municipal Fund 2 (NBJ) and Nuveen Ohio Dividend
Advantage Municipal Fund 3 (NVJ) (collectively, the "Funds"). Common shares of
Michigan Quality Income (NUM), Michigan Premium Income (NMP), and Ohio Quality
Income (NUO) are traded on the New York Stock Exchange (NYSE) while Common
shares of Michigan Dividend Advantage (NZW), Ohio Dividend Advantage (NXI), Ohio
Dividend Advantage 2 (NBJ) and Ohio Dividend Advantage 3 (NVJ) are traded on the
NYSE Amex. The Funds are registered under the Investment Company Act of 1940, as
amended, as closed-end management investment companies.
Each Fund seeks to provide current income exempt from both regular federal and
designated state income taxes by investing primarily in a portfolio of municipal
obligations issued by state and local government authorities within a single
state or certain U.S. territories.
In June 2009, the Financial Accounting Standards Board (FASB) established the
FASB Accounting Standards Codification(TM) (the "Codification") as the single
source of authoritative accounting principles recognized by the FASB in the
preparation of financial statements in conformity with generally accepted
accounting principles (GAAP). The Codification supersedes existing
non-grandfathered, non-SEC accounting and reporting standards. The Codification
did not change GAAP but rather organized it into a hierarchy where all guidance
within the Codification carries an equal level of authority. The Codification
became effective for financial statements issued for interim and annual periods
ending after September 15, 2009. The Codification did not have a material effect
on the Funds' financial statements.
During the fiscal period ended February 28, 2009, the Board of
Directors/Trustees of the Funds approved a change in the Funds' fiscal and tax
year ends from July 31 to February 28/29.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with US
generally accepted accounting principles.
INVESTMENT VALUATION
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors/Trustees. Prices
of forward swap contracts are also provided by an independent pricing service
approved by each Fund's Board of Directors/Trustees. Futures contracts are
valued using the closing settlement price. When market price quotes are not
readily available (which is usually the case for municipal securities), the
pricing service or, in the absence of a pricing service for a particular
investment or derivative instrument, the Board of Directors/Trustees of the
Fund, or its designee, may establish fair value using a wide variety of market
data including 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. Temporary investments in securities
that have variable rate and demand features qualifying them as short-term
investments are valued at amortized cost, which approximates value.
INVESTMENT TRANSACTIONS
Investment transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Investments purchased on a when-issued/delayed delivery basis may have extended
settlement periods. Any investments so purchased are subject to market
fluctuation during this period. The Funds have instructed the custodian to
segregate assets with a current value at least equal to the amount of the
when-issued/delayed delivery purchase commitments. At February 28, 2010, there
were no such outstanding purchase commitments in any of the Funds.
INVESTMENT INCOME
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Investment income also includes paydown gains and losses, if any.
68 Nuveen Investments
INCOME TAXES
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 to 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. Furthermore,
each Fund intends to satisfy conditions that will enable interest from municipal
securities, which is exempt from regular federal and designated state income
taxes, 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.
For all open tax years and all major taxing jurisdictions, management of the
Funds has concluded that there are no significant uncertain tax positions that
would require recognition in the financial statements. Open tax years are those
that are open for examination by taxing authorities (i.e., generally the last
four tax year ends and the interim tax period since then). Furthermore,
management of the Funds is also not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will
significantly change in the next twelve months.
DIVIDENDS AND DISTRIBUTIONS TO COMMON SHAREHOLDERS
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders at least annually. Furthermore, capital
gains are distributed only to the extent they exceed available capital loss
carryforwards.
Distributions to Common shareholders of tax-exempt net investment income, net
realized capital gains and/or market discount, if any, are recorded on the
ex-dividend date. The amount and timing of distributions are determined in
accordance with federal income tax regulations, which may differ from US
generally accepted accounting principles.
PREFERRED SHARES
The Funds have issued and outstanding Preferred shares, $25,000 stated value per
share, as a means of effecting financial leverage. Each Fund's Preferred shares
are issued in one or more Series. The dividend rate paid by the Funds on each
Series is determined every seven days, pursuant to a dutch auction process
overseen by the auction agent, and is payable at the end of each rate period. As
of February 28, 2010, the number of Preferred shares outstanding, by Series and
in total, for each Fund is as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
--------------------------------------------------------------------------------
Number of shares:
Series M -- 805 --
Series W -- -- 571
Series TH 2,972 1,343 --
Series F 521 -- --
--------------------------------------------------------------------------------
Total 3,493 2,148 571
================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
--------------------------------------------------------------------------------
Number of shares:
Series M 645 -- -- --
Series T -- -- -- 620
Series W -- 1,160 -- --
Series TH 1,327 -- -- --
Series TH2 948 -- -- --
Series F -- -- 864 --
--------------------------------------------------------------------------------
Total 2,920 1,160 864 620
================================================================================
Nuveen Investments 69
| Notes to
| Financial Statements (continued)
Beginning in February 2008, more shares for sale were submitted in the regularly
scheduled auctions for the Preferred shares issued by the Funds than there were
offers to buy. This meant that these auctions "failed to clear," and that many
Preferred shareholders who wanted to sell their shares in these auctions were
unable to do so. Preferred shareholders unable to sell their shares received
distributions at the "maximum rate" applicable to failed auctions as calculated
in accordance with the pre-established terms of the Preferred shares. As of
February 28, 2010, the aggregate amount of outstanding Preferred shares redeemed
by each Fund is as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
-----------------------------------------------------------------------------------------------------
Preferred shares redeemed, at liquidation value $6,675,000 $2,300,000 $1,725,000
=====================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
-----------------------------------------------------------------------------------------------------
Preferred shares redeemed, at liquidation value $4,000,000 $2,000,000 $2,400,000 $1,000,000
=====================================================================================================
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,
typically with a fixed interest rate, into a special purpose trust created by a
broker-dealer. In turn, this trust (a) issues floating rate certificates, in
face amounts equal to some fraction of the deposited bond's par amount or market
value, that typically pay short-term tax-exempt interest rates to third parties,
and (b) issues to a long-term investor (such as one of the Funds) an inverse
floating rate certificate (sometimes referred to as an "inverse floater") that
represents all remaining or residual interest in the trust. The income received
by the inverse floater holder varies inversely with the short-term rate paid to
the floating rate certificates' holders, 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 price of an inverse floating
rate security 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 floating rate certificates,
and because the inverse floating rate security essentially bears the risk of
loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market
transaction without first owning the underlying bond (referred to as an
"externally-deposited inverse floater"), or instead by first selling a
fixed-rate bond to a broker-dealer for deposit into the special purpose trust
and receiving in turn the residual interest in the trust (referred to as a
"self-deposited inverse floater"). The inverse floater held by a Fund gives the
Fund the right (a) to cause the holders of the floating rate certificates to
tender their notes at par, and (b) to have the broker transfer the fixed-rate
bond held by the trust to the Fund, thereby collapsing the trust. An investment
in an externally-deposited inverse floater is identified in the Portfolio of
Investments as "(IF) - Inverse floating rate investment." An investment in a
self-deposited inverse floater is accounted for as a financing transaction. In
such instances, a fixed-rate bond deposited into a special purpose trust is
identified in the Portfolio of Investments as "(UB) - Underlying bond of an
inverse floating rate trust reflected as a financing transaction," with the Fund
accounting for the short-term floating rate certificates issued by the trust as
"Floating rate obligations" on the Statement of Assets and Liabilities. In
addition, the Fund reflects in Investment Income the entire earnings of the
underlying bond and recognizes the related interest paid to the holders of the
short-term floating rate certificates as "Interest expense on floating rate
obligations" on the Statement of Operations.
During the fiscal year ended February 28, 2010, each Fund invested in
externally-deposited inverse floaters and/or self-deposited inverse floaters.
Each Fund may also enter into shortfall and forbearance agreements (sometimes
referred to as a "recourse trust" or "credit recovery swap") (such agreements
referred to herein as "Recourse Trusts") with a broker-dealer by which a Fund
agrees to reimburse the broker-dealer, in certain circumstances, for the
difference between the liquidation value of the fixed-rate bond held by the
trust and the liquidation value of the floating rate certificates issued by the
trust plus any shortfalls in interest cash flows. Under these agreements, a
Fund's potential exposure to losses related to or on inverse floaters may
increase beyond the value of a Fund's inverse floater investments as a Fund may
potentially be liable to fulfill all amounts owed to holders of the floating
rate certificates. At period end, any such shortfall is recognized as
"Unrealized depreciation on Recourse Trusts" on the Statement of Assets and
Liabilities.
At February 28, 2010, the Funds were not invested in externally-deposited
Recourse Trusts.
MICHIGAN MICHIGAN MICHIGAN OHIO OHIO OHIO OHIO
QUALITY PREMIUM DIVIDEND QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME INCOME ADVANTAGE INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUM) (NMP) (NZW) (NUO) (NXI) (NBJ) (NVJ)
-----------------------------------------------------------------------------------------------------------------------
Maximum exposure to Recourse Trusts $ -- $ -- $ -- $ -- $ -- $ -- $ --
=======================================================================================================================
70 Nuveen Investments
The average floating rate obligations outstanding and average annual interest
rate and fees related to self-deposited inverse floaters for the following Funds
during the fiscal year ended February 28, 2010, were as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
-----------------------------------------------------------------------------------
Average floating rate obligations outstanding $3,450,986 $2,215,096 $632,205
Average annual interest rate and fees 1.06% 1.06% 1.06%
================================================================================---
FORWARD SWAP CONTRACTS
Each Fund is authorized to enter into forward interest rate swap contracts
consistent with their investment objectives and policies to reduce, increase or
otherwise alter its risk profile or to alter its portfolio characteristics (i.e.
duration, yield curve positioning and credit quality).
Each Fund is subject to interest rate risk in the normal course of pursuing its
investment objectives. Each Fund's use of forward interest rate swap
transactions is intended to help the Fund manage its overall interest rate
sensitivity, either shorter or longer, generally to more closely align the
Fund's interest rate sensitivity with that of the broader municipal market.
Forward interest rate swap transactions involve each Fund's agreement with a
counterparty to pay, in the future, a fixed or variable rate payment in exchange
for the counterparty paying the Fund a variable or fixed rate payment, the
accruals for which would begin at a specified date in the future (the "effective
date"). The amount of the payment obligation is based on the notional amount of
the swap contract and the termination date of the swap (which is akin to a
bond's maturity). The value of the Fund's swap commitment would increase or
decrease based primarily on the extent to which long-term interest rates for
bonds having a maturity of the swap's termination date increases or decreases.
Forward interest rate swap contracts are valued daily. The net amount recorded
on these transactions for each counterparty is recognized on the Statement of
Assets and Liabilities as "Unrealized appreciation or depreciation on forward
swaps" with the change during the fiscal period recognized on the Statement of
Operations as "Change in net unrealized appreciation (depreciation) of forward
swaps."
The Funds may terminate a swap contract prior to the effective date, at which
point a realized gain or loss is recognized. When a forward swap is terminated,
it ordinarily does not involve the delivery of securities or other underlying
assets or principal, but rather is settled in cash on a net basis. Net realized
gains and losses during the fiscal period are recognized on the Statement of
Operations as "Net realized gain (loss) from forward swaps." Each Fund intends,
but is not obligated, to terminate its forward swaps before the effective date.
Accordingly, the risk of loss with respect to the swap counterparty on such
transactions is limited to the credit risk associated with a counterparty
failing to honor its commitment to pay any realized gain to the Fund upon
termination. The Funds did not invest in forward interest rate swap transactions
during the fiscal year ended February 28, 2010.
FUTURES CONTRACTS
Each Fund is subject to interest rate risk in the normal course of pursuing its
investment objectives and is authorized to invest in futures contracts in
attempt to manage such risk. Upon entering into a futures contract, a Fund is
required to deposit with the broker an amount of cash or liquid securities equal
to a specified percentage of the contract amount. This is known as the "initial
margin." Cash held by the broker to cover initial margin requirements on open
futures contracts, if any, is recognized as "Deposits with brokers for open
futures contracts" on the Statement of Assets and Liabilities. Subsequent
payments ("variation margin") are made or received by a Fund each day, depending
on the daily fluctuation of the value of the contract. Variation margin is
recognized as a receivable or payable for "Variation margin on futures
contracts" on the Statement of Assets and Liabilities, when applicable.
During the period the futures contract is open, changes in the value of the
contract are recorded as an unrealized gain or loss by "marking-to-market" on a
daily basis to reflect the changes in market value of the contract and is
recognized as "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 and is recognized as "Net realized gain (loss) from
futures contracts" on the Statement of Operations.
Risks of investments in futures contracts include the possible adverse movement
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. The Funds did not invest in futures
contracts during the fiscal year ended February 28, 2010.
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
Nuveen Investments 71
| Notes to
| Financial Statements (continued)
Liabilities. Futures contracts, when applicable, expose a Fund to minimal
counterparty credit risk as they are exchange traded and the exchange's
clearinghouse, which is counterparty to all exchange traded futures, guarantees
the futures contracts against default.
Each Fund helps manage counterparty credit risk by entering into agreements only
with counterparties Nuveen Asset Management (the "Adviser"), a wholly-owned
subsidiary of Nuveen Investments, Inc. ("Nuveen"), 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 predetermined threshold amount.
ZERO COUPON SECURITIES
Each Fund is authorized to invest in zero coupon securities. A zero coupon
security does not pay a regular interest coupon to its holders during the life
of the security. Tax-exempt 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. Such securities are included in the Portfolios of Investments
with a 0.000% coupon rate in their description. The market prices of zero coupon
securities generally are more volatile than the market prices of securities that
pay interest periodically.
CUSTODIAN FEE CREDIT
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by net credits earned on each Fund's cash on
deposit with the bank. Such deposit arrangements are an alternative to overnight
investments. Credits for cash balances may be offset by charges for any days on
which a Fund overdraws its account at the custodian bank.
INDEMNIFICATIONS
Under the Funds' organizational documents, their officers and directors/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.
USE OF ESTIMATES
The preparation of financial statements in conformity with US generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets applicable to Common shares from operations during the reporting period.
Actual results may differ from those estimates.
2. FAIR VALUE MEASUREMENTS
In determining the value of each Fund's investments, various inputs are used.
These inputs are summarized in the three broad levels listed below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3 - Significant unobservable inputs (including management's
assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities. The following is a
summary of each Fund's fair value measurements as of February 28, 2010:
MICHIGAN QUALITY INCOME (NUM) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $258,410,792 $ -- $258,410,792
=================================================================================================
MICHIGAN PREMIUM INCOME (NMP) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $162,988,845 $ -- $162,988,845
=================================================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 43,529,285 $ -- $ 43,529,285
=================================================================================================
72 Nuveen Investments
OHIO QUALITY INCOME (NUO) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $227,627,910 $ -- $227,627,910
=================================================================================================
OHIO DIVIDEND ADVANTAGE (NXI) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 92,056,406 $ -- $ 92,056,406
=================================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 66,540,693 $ -- $ 66,540,693
=================================================================================================
OHIO DIVIDEND ADVANTAGE 3 (NVJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
-------------------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 47,875,063 $ -- $ 47,875,063
=================================================================================================
3. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
During the current fiscal period, the Funds adopted amendments to authoritative
guidance under GAAP on disclosures about derivative instruments and hedging
activities. This guidance is intended to enhance financial statement disclosures
for derivative instruments and hedging activities and enable investors to better
understand: a) how and why a fund uses derivative instruments; b) how derivative
instruments are accounted for; and c) how derivative instruments affect a fund's
financial position, results of operations and cash flows, if any. 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
considered to be non-hedge transactions for financial reporting purposes. The
Funds did not invest in derivative instruments during the fiscal year ended
February 28, 2010.
4. FUND SHARES
COMMON SHARES
Transactions in Common shares were as follows:
MICHIGAN QUALITY MICHIGAN PREMIUM
INCOME (NUM) INCOME (NMP)
--------------------------------- ----------------------------------
YEAR SEVEN MONTHS YEAR YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
--------------------------------------------------------------------------------------------------------------------------
Common shares:
Issued to shareholders due to
reinvestment of distributions -- -- -- -- -- --
Repurchased and retired (153,900) -- -- (110,400) (26,700) --
--------------------------------------------------------------------------------------------------------------------------
Weighted average Common share:
Price per share repurchased and retired $11.54 -- -- $11.50 $10.58 --
Discount per share repurchased and retired 18.15% -- -- 17.11% 20.80% --
==========================================================================================================================
MICHIGAN DIVIDEND OHIO QUALITY
ADVANTAGE (NZW) INCOME (NUO)
--------------------------------- ----------------------------------
YEAR SEVEN MONTHS YEAR YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
--------------------------------------------------------------------------------------------------------------------------
Common shares:
Issued to shareholders due to
reinvestment of distributions -- -- 595 -- -- --
Repurchased and retired (12,200) -- -- -- -- --
--------------------------------------------------------------------------------------------------------------------------
Weighted average Common share:
Price per share repurchased and retired $12.15 -- -- -- -- --
Discount per share repurchased and retired 13.24% -- -- -- -- --
==========================================================================================================================
Nuveen Investments 73
| Notes to
| Financial Statements (continued)
OHIO DIVIDEND OHIO DIVIDEND
ADVANTAGE (NXI) ADVANTAGE 2 (NBJ)
--------------------------------- ----------------------------------
YEAR SEVEN MONTHS YEAR YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08 2/28/10 2/28/09 7/31/08
--------------------------------------------------------------------------------------------------------------------------
Common shares:
Issued to shareholders due to
reinvestment of distributions -- -- -- -- -- --
Repurchased and retired -- (600) -- -- -- --
--------------------------------------------------------------------------------------------------------------------------
Weighted average Common share:
Price per share repurchased and retired -- $11.50 -- -- -- --
Discount per share repurchased and retired -- 17.21% -- -- -- --
==========================================================================================================================
OHIO DIVIDEND
ADVANTAGE 3 (NVJ)
----------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
--------------------------------------------------------------------------------------------------------------------------
Common shares:
Issued to shareholders due to
reinvestment of distributions -- -- --
Repurchased and retired -- (1,700) --
--------------------------------------------------------------------------------------------------------------------------
Weighted average Common share:
Price per share repurchased and retired -- $11.82 --
Discount per share repurchased and retired -- 16.10% --
==========================================================================================================================
PREFERRED SHARES
Transactions in Preferred shares were as follows:
MICHIGAN QUALITY INCOME (NUM)
------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-----------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series TH 122 $3,050,000 106 $2,650,000 -- $ --
Series F 21 525,000 18 450,000 -- --
-----------------------------------------------------------------------------------------------------------------------
Total 143 $3,575,000 124 $3,100,000 -- $ --
=======================================================================================================================
MICHIGAN PREMIUM INCOME (NMP)
------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-----------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series M 35 $ 875,000 -- $ -- -- $ --
Series TH 57 1,425,000 -- -- -- --
-----------------------------------------------------------------------------------------------------------------------
Total 92 $2,300,000 -- $ -- -- $ --
=======================================================================================================================
74 Nuveen Investments
MICHIGAN DIVIDEND ADVANTAGE (NZW)
---------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
---------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series W 26 $650,000 43 $1,075,000 -- $ --
==========================================================================================================================
OHIO QUALITY INCOME (NUO)
---------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
---------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series M 35 $ 875,000 -- $ -- -- $ --
Series TH 73 1,825,000 -- -- -- --
Series TH2 52 1,300,000 -- -- -- --
--------------------------------------------------------------------------------------------------------------------------
Total 160 $4,000,000 -- $ -- -- $ --
==========================================================================================================================
OHIO DIVIDEND ADVANTAGE (NXI)
---------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
---------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series T 80 $2,000,000 -- $ -- -- $ --
==========================================================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
---------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/08
---------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series F 60 $1,500,000 36 $900,000 -- $ --
==========================================================================================================================
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
---------------------------------------------------------------
YEAR SEVEN MONTHS YEAR
ENDED ENDED ENDED
2/28/10 2/28/09 7/31/09
---------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------------------------
Preferred shares redeemed:
Series T 40 $1,000,000 -- $ -- -- $ --
==========================================================================================================================
MUNIFUND TERM PREFERRED SHARES
During January 2010, Michigan Dividend Advantage (NZW) and Ohio Dividend
Advantage 3 (NVJ) filed with the Securities and Exchange Commission (SEC) a
registration statement seeking to register MTP. These registration statements,
declared effective by the SEC, enable the Funds to issue to the public shares of
MTP to refinance all or a portion of their ARPS. The issuance of MTP by these
Funds is subject to market conditions. There is no assurance that these MTP
shares will be issued.
Nuveen Investments 75
| Notes to
| Financial Statements (continued)
5. INVESTMENT TRANSACTIONS
Purchases and sales (including maturities but excluding short-term investments)
during the fiscal year ended February 28, 2010, were as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Purchases $ 24,345,889 $ 19,798,850 $ 3,094,489
Sales and maturities 23,849,386 19,453,989 2,727,220
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Purchases $ 14,552,863 $ 5,939,043 $ 5,423,046 $ 6,452,863
Sales and maturities 13,705,919 7,332,414 6,142,902 7,124,018
=====================================================================================================================
6. INCOME TAX INFORMATION
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to timing differences in recognizing taxable market discount,
timing differences in recognizing certain gains and losses on investment
transactions and the treatment of investments in inverse floating rate
securities reflected as financing transactions, if any. To the extent that
differences arise that are permanent in nature, such amounts are reclassified
within the capital accounts on the Statement of Assets and Liabilities presented
in the annual report, based on their federal tax basis treatment; temporary
differences do not require reclassification. Temporary and permanent differences
do not impact the net asset values of the Funds.
At February 28, 2010, the cost of investments was as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Cost of investments $244,996,805 $157,283,489 $41,898,032
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Cost of investments $218,568,487 $ 88,970,270 $ 64,636,296 $45,557,939
=====================================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at February 28, 2010, were as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 12,355,284 $ 4,815,415 $ 1,628,277
Depreciation (2,570,721) (1,439,601) (661,800)
---------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments $ 9,784,563 $ 3,375,814 $ 966,477
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 11,851,544 $ 4,516,364 $ 2,801,992 $ 3,002,196
Depreciation (2,792,121) (1,430,228) (897,595) (685,072)
---------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments $ 9,059,423 $ 3,086,136 $ 1,904,397 $ 2,317,124
=====================================================================================================================
76 Nuveen Investments
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at February 28, 2010, the Funds' tax year end,
were as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income* $ 2,713,075 $ 1,776,023 $ 444,067
Undistributed net ordinary income** 969 177 90
Undistributed net long-term capital gains -- -- --
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income* $ 2,526,500 $ 1,105,725 $ 749,997 $ 584,364
Undistributed net ordinary income** 53,384 58,022 24,745 5,763
Undistributed net long-term capital gains -- 24,115 -- --
=====================================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on February 1, 2010, paid on March 1, 2010.
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the Funds' tax years ended
February 28, 2010, February 28, 2009 and July 31, 2008, was designated for
purposes of the dividends paid deduction as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
YEAR ENDED FEBRUARY 28, 2010 (NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income*** $ 8,303,611 $ 5,617,873 $ 1,531,890
Distributions from net ordinary income** -- -- --
Distributions from net long-term capital gains**** -- -- --
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
YEAR ENDED FEBRUARY 28, 2010 (NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income*** $ 7,994,424 $ 3,335,906 $ 2,373,144 $ 1,758,180
Distributions from net ordinary income** -- 39,995 -- --
Distributions from net long-term capital gains**** -- -- -- --
=====================================================================================================================
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
SEVEN MONTHS ENDED FEBRUARY 28, 2009 (NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 6,134,177 $ 3,859,940 $ 1,079,536
Distributions from net ordinary income** -- -- --
Distributions from net long-term capital gains -- -- 33,173
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
SEVEN MONTHS ENDED FEBRUARY 28, 2009 (NUO) (NXI) (NBJ) (NVJ)
--------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 5,095,614 $ 2,133,665 $ 1,578,459 $ 1,122,076
Distributions from net ordinary income** -- -- -- --
Distributions from net long-term capital gains -- -- -- --
=====================================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
*** The Funds hereby designate these amounts paid during the fiscal year ended
February 28, 2010, as Exempt Interest Dividends.
**** The Funds designate as a long-term capital gain dividend, pursuant to the
Internal Revenue Code Section 852(b)(3), the amount necessary to reduce
earnings and profits of the Funds related to net capital gain to zero for
the tax year ended February 28, 2010.
Nuveen Investments 77
| Notes to
| Financial Statements (continued)
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
YEAR ENDED JULY 31, 2008 (NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 10,748,540 $ 6,922,965 $ 1,960,679
Distributions from net ordinary income** 68,426 12,818 --
Distributions from net long-term capital gains 1,574,122 748,463 198,609
=====================================================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
YEAR ENDED JULY 31, 2008 (NUO) (NXI) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 8,988,444 $ 3,778,712 $ 2,803,986 $ 1,968,527
Distributions from net ordinary income** 10,212 -- 3,297 --
Distributions from net long-term capital gains 882,398 532,929 248,931 177,807
=====================================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
At February 28, 2010, the Funds' tax year end, the following Funds had unused
capital loss carryforwards available for federal income tax purposes to be
applied against future capital gains, if any. If not applied, the carryforwards
will expire as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
---------------------------------------------------------------------------------------------------------------------
Expiration:
February 29, 2016 $ -- $ 34,858 $ --
February 28, 2017 337,855 336,297 457,422
February 28, 2018 2,690,744 1,586,140 834,359
---------------------------------------------------------------------------------------------------------------------
Total $ 3,028,599 $ 1,957,295 $ 1,291,781
=====================================================================================================================
OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND
INCOME ADVANTAGE 2 ADVANTAGE 3
(NUO) (NBJ) (NVJ)
---------------------------------------------------------------------------------------------------------------------
Expiration:
February 29, 2016 $ -- $ 14,045 $ --
February 28, 2017 1,309,059 522,972 52,532
February 28, 2018 78,027 211,828 177,836
---------------------------------------------------------------------------------------------------------------------
Total $ 1,387,086 $ 748,845 $ 230,368
=====================================================================================================================
Michigan Dividend Advantage (NZW) elected to defer net realized losses from
investments incurred from November 1, 2009 through February 28, 2010, the Fund's
tax year end, ("post-October losses") in accordance with federal income tax
regulations. Post-October capital losses of $8,448 are treated as having arisen
on the first day of the following fiscal year.
7. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund's management fee is separated into 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 fund assets managed by
the Adviser. This pricing structure enables each Fund's 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.
78 Nuveen Investments
The annual fund-level fee for each Fund, payable monthly, is calculated
according to the following schedule:
MICHIGAN QUALITY INCOME (NUM)
MICHIGAN PREMIUM INCOME (NMP)
OHIO QUALITY INCOME (NUO)
AVERAGE DAILY NET ASSETS* FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4500%
For the next $125 million .4375
For the next $250 million .4250
For the next $500 million .4125
For the next $1 billion .4000
For the next $3 billion .3875
For net assets over $5 billion .3750
================================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW)
OHIO DIVIDEND ADVANTAGE (NXI)
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
AVERAGE DAILY NET ASSETS* FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4500%
For the next $125 million .4375
For the next $250 million .4250
For the next $500 million .4125
For the next $1 billion .4000
For net assets over $2 billion .3750
================================================================================
The annual complex-level fee for each Fund, payable monthly, is calculated
according to the following schedule:
COMPLEX-LEVEL ASSET BREAKPOINT LEVEL* EFFECTIVE RATE AT BREAKPOINT LEVEL
--------------------------------------------------------------------------------
$55 billion .2000%
$56 billion .1996
$57 billion .1989
$60 billion .1961
$63 billion .1931
$66 billion .1900
$71 billion .1851
$76 billion .1806
$80 billion .1773
$91 billion .1691
$125 billion .1599
$200 billion .1505
$250 billion .1469
$300 billion .1445
================================================================================
* The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate daily managed assets of all Nuveen
funds, with such daily managed assets defined separately for each fund in
its management agreement, but excluding assets attributable to investments
in other Nuveen funds. For the complex-level and fund-level fees, daily
managed assets include assets managed by the Adviser that are attributable
to financial leverage. For these purposes, financial leverage includes the
funds' 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, subject to an agreement by
the Adviser to limit the amount of such assets for determining managed
assets in certain circumstances. As of February 28, 2010, the
complex-level fee rate was .1874%.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its directors/trustees who are affiliated with
the Adviser or to its officers, all of whom receive remuneration for their
services to the Funds from the Adviser or its affiliates. The Board of
Directors/Trustees has adopted a deferred compensation plan for independent
directors/trustees that enables directors/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.
Nuveen Investments 79
| Notes to
| Financial Statements (continued)
For the first ten years of Ohio Dividend Advantage's (NXI) operations, the
Adviser has agreed to reimburse the Fund, as a percentage of average daily net
assets, for fees and expenses in the amounts and for the time periods set forth
below:
YEAR ENDING YEAR ENDING
MARCH 31, MARCH 31,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Ohio Dividend Advantage (NXI) for any
portion of its fees and expenses beyond March 31, 2011.
For the first ten years of Michigan Dividend Advantage's (NZW) and Ohio Dividend
Advantage 2's (NBJ) operations, the Adviser has agreed to reimburse the Funds,
as a percentage of average daily net assets, for fees and expenses in the
amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Michigan Dividend Advantage (NZW) and
Ohio Dividend Advantage 2 (NBJ) for any portion of their fees and expenses
beyond September 30, 2011.
For the first ten years of Ohio Dividend Advantage 3's (NVJ) operations, the
Adviser has agreed to reimburse the Fund, as a percentage of average daily net
assets, for fees and expenses in the amounts and for the time periods set forth
below:
YEAR ENDING YEAR ENDING
MARCH 31, MARCH 31,
--------------------------------------------------------------------------------
2002* .30% 2008 .25%
2003 .30 2009 .20
2004 .30 2010 .15
2005 .30 2011 .10
2006 .30 2012 .05
2007 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Ohio Dividend Advantage 3 (NVJ) for any
portion of its fees and expenses beyond March 31, 2012.
8. NEW ACCOUNTING PRONOUNCEMENTS
ACCOUNTING FOR TRANSFERS OF FINANCIAL ASSETS
During June 2009, FASB issued changes to the authoritative guidance under GAAP
on accounting for transfers of financial assets. The objective of this guidance
is to improve the relevance, representational faithfulness, and comparability of
the information that a reporting entity provides in its financial statements
about a transfer of financial assets; the effects of a transfer on its financial
position, financial performance, and cash flows; and transferor's continuing
involvement, if any, in transferred financial assets.
This guidance is effective as of the beginning of each reporting entity's first
annual reporting period that begins after November 15, 2009, for interim periods
within that first annual reporting period and for interim and annual reporting
periods thereafter. Earlier application is prohibited. The recognition and
measurement provisions of this guidance must be applied to transfers occurring
on or after the effective date. Additionally, the disclosure provisions of this
guidance should be applied to transfers that occurred both before and after the
effective date of this guidance. At this time, management is evaluating the
implications of this guidance and the impact it will have on the financial
statement amounts and disclosures, if any.
80 Nuveen Investments
FAIR VALUE MEASUREMENTS
On January 21, 2010, FASB issued changes to the authoritative guidance under
GAAP for fair value measurements. The objective of this guidance is to provide
guidance on how investment assets and liabilities are to be valued and
disclosed. Specifically, the amendment requires reporting entities to disclose
i) the input and valuation techniques used to measure fair value for both
recurring and nonrecurring fair value measurements, for both Level 2 and Level 3
positions, ii) transfers between all levels (including Level 1 and Level 2) on a
gross basis (i.e., transfers out must be disclosed separately from transfers in)
as well as the reason(s) for the transfer and iii) purchases, sales, issuances
and settlements in the Level 3 rollforward must be shown on a gross basis rather
than as one net number. The effective date of the amendment is for interim and
annual periods beginning after December 15, 2009, however, the requirement to
provide the Level 3 activity for purchases, sales, issuances and settlements on
a gross basis will be effective for interim and annual periods beginning after
December 15, 2010. At this time, management is evaluating the implications of
this guidance and the impact it will have to the financial statement amounts and
footnote disclosures, if any.
9. SUBSEQUENT EVENTS
DISTRIBUTIONS TO COMMON SHAREHOLDERS
The Funds declared Common share dividend distributions from their tax-exempt net
investment income, which were paid on April 1, 2010, to shareholders of record
on March 15, 2010, as follows:
MICHIGAN MICHIGAN MICHIGAN
QUALITY PREMIUM DIVIDEND
INCOME INCOME ADVANTAGE
(NUM) (NMP) (NZW)
--------------------------------------------------------------------------------
Dividend per share $.0660 $.0650 $. 0640
================================================================================
OHIO OHIO OHIO OHIO
QUALITY DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NUO) (NXI) (NBJ) (NVJ)
--------------------------------------------------------------------------------
Dividend per share $.0740 $.0700 $.0690 $.0730
================================================================================
MUNIFUND TERM PREFERRED SHARES
Subsequent to the reporting period, Ohio Dividend Advantage (NXI) and Ohio
Dividend Advantage 2 (NBJ) filed with the Securities and Exchange Commission
(the "SEC") a registration statement seeking to register MuniFund Term Preferred
shares ("MTP"). These registration statements, declared effective by the SEC,
enable the Funds to issue to the public shares of MTP to refinance all or a
portion of their Preferred shares. The issuance of MTP by Ohio Dividend
Advantage (NXI) and Ohio Dividend Advantage 2 (NBJ) is subject to market
conditions. There is no assurance that MTP will be issued.
Nuveen Investments 81
| Financial
| Highlights
Selected data for a Common share outstanding throughout each period:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------------------------------- ------------------------------
DISTRIBUTIONS DISTRIBUTIONS
FROM NET FROM NET
BEGINNING INVESTMENT CAPITAL INVESTMENT CAPITAL
COMMON NET INCOME TO GAINS TO INCOME TO GAINS TO
SHARE NET REALIZED/ PREFERRED PREFERRED COMMON COMMON
NET ASSET INVESTMENT UNREALIZED SHARE- SHARE- SHARE- SHARE-
VALUE INCOME GAIN (LOSS) HOLDERS+ HOLDERS+ TOTAL HOLDERS HOLDERS TOTAL
--------------------------------------------------------------------------------------------------------------------------------
MICHIGAN QUALITY INCOME (NUM)
--------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $13.55 $.93 $1.06 $(.04) $ -- $1.95 $(.73) $ -- $ (.73)
2009(d) 14.13 .54 (.60) (.13) -- (.19) (.39) -- (.39)
Year Ended 7/31:
2008 14.96 .93 (.71) (.24) (.04) (.06) (.67) (.10) (.77)
2007 15.17 .94 (.10) (.25) (.02) .57 (.71) (.07) (.78)
2006 15.88 .96 (.52) (.21) (.02) .21 (.81) (.11) (.92)
2005 15.51 .98 .57 (.13) (.01) 1.41 (.93) (.11) (1.04)
MICHIGAN PREMIUM INCOME (NMP)
--------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 13.26 .90 .97 (.04) -- 1.83 (.71) -- (.71)
2009(d) 13.87 .52 (.63) (.12) -- (.23) (.38) -- (.38)
Year Ended 7/31:
2008 14.65 .89 (.69) (.23) (.02) (.05) (.66) (.07) (.73)
2007 14.92 .90 (.12) (.23) (.02) .53 (.71) (.09) (.80)
2006 15.55 .91 (.40) (.18) (.02) .31 (.79) (.15) (.94)
2005 15.19 .93 .50 (.11) -- 1.32 (.91) (.05) (.96)
================================================================================================================================
DISCOUNT OFFERING
FROM COSTS AND PREFERRED SHARES AT END OF PERIOD
COMMON PREFERRED ENDING -------------------------------------
SHARES SHARE COMMON AGGREGATE LIQUIDATION
REPURCHASED UNDER- SHARE ENDING AMOUNT AND MARKET ASSET
AND WRITING NET ASSET MARKET OUTSTANDING VALUE COVERAGE
RETIRED DISCOUNTS VALUE VALUE (000) PER SHARE PER SHARE
-------------------------------------------------------------------------------------------------------
MICHIGAN QUALITY INCOME (NUM)
-------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $.02 $ -- $14.79 $12.94 $87,325 $25,000 $73,950
2009(d) -- -- 13.55 10.61 90,900 25,000 68,651
Year Ended 7/31:
2008 -- -- 14.13 12.32 94,000 25,000 69,023
2007 -- -- 14.96 14.16 94,000 25,000 71,607
2006 -- -- 15.17 14.41 94,000 25,000 72,270
2005 -- -- 15.88 15.67 94,000 25,000 74,441
MICHIGAN PREMIUM INCOME (NMP)
-------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 .02 -- 14.40 12.50 53,700 25,000 76,033
2009(d) --* -- 13.26 10.44 56,000 25,000 70,730
Year Ended 7/31:
2008 -- -- 13.87 12.38 56,000 25,000 72,986
2007 -- -- 14.65 13.80 56,000 25,000 75,695
2006 -- -- 14.92 14.27 56,000 25,000 76,612
2005 -- -- 15.55 15.68 56,000 25,000 78,783
=======================================================================================================
82 Nuveen Investments
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
TOTAL RETURNS BEFORE REIMBURSEMENT++
-------------------- ------------------------------------
BASED ENDING
ON NET
BASED COMMON ASSETS
ON SHARE NET APPLICABLE EXPENSES EXPENSES NET
MARKET ASSET TO COMMON INCLUDING EXCLUDING INVESTMENT
VALUE(a) VALUE(a) SHARES (000) INTEREST(c) INTEREST INCOME
-------------------------------------------------------------------------------------------------
MICHIGAN QUALITY INCOME (NUM)
-------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 29.40% 14.83% $170,983 1.24% 1.22% 6.50%
2009(d) (10.68) (1.27) 158,717 1.33** 1.33** 6.92**
Year Ended 7/31:
2008 (7.77) (.43) 165,525 1.29 1.25 6.28
2007 3.64 3.77 175,244 1.26 1.22 6.12
2006 (2.28) 1.41 177,734 1.23 1.23 6.17
2005 9.94 9.28 185,900 1.22 1.22 6.13
MICHIGAN PREMIUM INCOME (NMP)
-------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 27.06 14.22 109,619 1.25 1.23 6.51
2009(d) (12.57) (1.62) 102,434 1.32** 1.32** 6.83**
Year Ended 7/31:
2008 (5.09) (.36) 107,488 1.38 1.23 6.16
2007 2.16 3.59 113,558 1.38 1.22 5.97
2006 (3.12) 2.06 115,611 1.20 1.20 6.03
2005 16.03 8.80 120,475 1.19 1.19 5.97
=================================================================================================
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
AFTER REIMBURSEMENT++(b)
------------------------------------
EXPENSES EXPENSES NET PORTFOLIO
INCLUDING EXCLUDING INVESTMENT TURNOVER
INTEREST(c) INTEREST INCOME RATE
-------------------------------------------------------------------
MICHIGAN QUALITY INCOME (NUM)
-------------------------------------------------------------------
Year Ended 2/28:
2010 1.24% 1.22% 6.50% 9%
2009(d) 1.33** 1.33** 6.93** 3
Year Ended 7/31:
2008 1.29 1.25 6.28 18
2007 1.26 1.22 6.12 13
2006 1.23 1.23 6.18 18
2005 1.22 1.22 6.13 8
MICHIGAN PREMIUM INCOME (NMP)
-------------------------------------------------------------------
Year Ended 2/28:
2010 1.25 1.23 6.51 12
2009(d) 1.32** 1.32** 6.83** 3
Year Ended 7/31:
2008 1.38 1.23 6.16 20
2007 1.38 1.22 5.97 15
2006 1.20 1.10 6.02 6
2005 1.19 1.19 5.96 11
===================================================================
* Rounds to less than $.01 per share.
** Annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; Net Investment Income ratios reflect income earned and
expenses incurred on assets attributable to Preferred shares.
(a) Total Return Based on Market Value 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.
Total Return Based on Common Share Net Asset Value is the combination of
changes in Common share net asset value, reinvested dividend income at net
asset value and reinvested capital gains distributions at net asset value,
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 net asset value. 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 net asset value), and therefore may be different
from the price used in the calculation. Total returns are not annualized.
(b) After expense reimbursement from the Adviser, where applicable. Expense
ratios do not reflect the reduction of custodian fee credits earned on the
Fund's net cash on deposit with the custodian bank, where applicable.
(c) The expense ratios reflect, among other things, 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 Footnote 1 - Inverse Floating
Rate Securities.
(d) For the seven months ended February 28, 2009.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 83
| Financial
| Highlights (continued)
Selected data for a Common share outstanding throughout each period:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------------------------------------ ------------------------------
DISTRIBUTIONS DISTRIBUTIONS
FROM NET FROM NET
BEGINNING INVESTMENT CAPITAL INVESTMENT CAPITAL
COMMON NET INCOME TO GAINS TO INCOME TO GAINS TO
SHARE NET REALIZED/ PREFERRED PREFERRED COMMON COMMON
NET ASSET INVESTMENT UNREALIZED SHARE- SHARE- SHARE- SHARE-
VALUE INCOME GAIN (LOSS) HOLDERS+ HOLDERS+ TOTAL HOLDERS HOLDERS TOTAL
====================================================================================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $12.69 $.91 $ 1.32 $(.03) $-- $2.20 $(.72) $ -- $(.72)
2009(d) 13.68 .54 (1.00) (.13) --** (.59) (.39) (.01) (.40)
Year Ended 7/31:
2008 14.73 .94 (.95) (.24) (.02) (.27) (.71) (.07) (.78)
2007 14.94 .95 (.14) (.24) --** .57 (.77) (.01) (.78)
2006 15.44 .97 (.40) (.20) -- .37 (.87) -- (.87)
2005 14.82 .98 .63 (.11) -- 1.50 (.89) -- (.89)
====================================================================================================================================
DISCOUNT OFFERING
FROM COSTS AND PREFERRED SHARES AT END OF PERIOD
COMMON PREFERRED ENDING --------------------------------------
SHARES SHARE COMMON AGGREGATE LIQUIDATION
REPURCHASED UNDER- SHARE ENDING AMOUNT AND MARKET ASSET
AND WRITING NET ASSET MARKET OUTSTANDING VALUE COVERAGE
RETIRED DISCOUNTS VALUE VALUE (000) PER SHARE PER SHARE
==================================================================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW)
------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $.01 $ -- $14.18 $12.43 $14,275 $25,000 $76,010
2009(d) -- -- 12.69 10.77 14,925 25,000 68,946
Year Ended 7/31:
2008 -- -- 13.68 13.10 16,000 25,000 69,195
2007 -- -- 14.73 15.10 16,000 25,000 72,561
2006 -- -- 14.94 15.81 16,000 25,000 73,161
2005 -- .01 15.44 16.79 16,000 25,000 74,720
==================================================================================================================
84 Nuveen Investments
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
TOTAL RETURNS BEFORE REIMBURSEMENT++
--------------------- -------------------------------------
BASED ENDING
ON NET
BASED COMMON ASSETS
ON SHARE NET APPLICABLE EXPENSES EXPENSES NET
MARKET ASSET TO COMMON INCLUDING EXCLUDING INVESTMENT
VALUE(a) VALUE(a) SHARES (000) INTEREST(c) INTEREST INCOME
=====================================================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW)
-----------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 22.58% 17.70% $29,127 1.35% 1.33% 6.48%
2009(d) (14.48) (4.20) 26,236 1.48** 1.48** 7.03**
Year Ended 7/31:
2008 (8.10) (1.95) 28,285 1.39 1.34 6.23
2007 .46 3.79 30,439 1.38 1.35 5.89
2006 (.47) 2.46 30,823 1.31 1.31 5.92
2005 21.34 10.41 31,821 1.27 1.27 5.93
=====================================================================================================
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
AFTER REIMBURSEMENT++(b)
---------------------------------------
EXPENSES EXPENSES NET PORTFOLIO
INCLUDING EXCLUDING INVESTMENT TURNOVER
INTEREST(c) INTEREST INCOME RATE
===========================================================================
MICHIGAN DIVIDEND ADVANTAGE (NZW)
---------------------------------------------------------------------------
Year Ended 2/28:
2010 1.15% 1.13% 6.68% 6%
2009(d) 1.22** 1.22** 7.29** 4
Year Ended 7/31:
2008 1.07 1.03 6.55 18
2007 .99 .96 6.28 19
2006 .86 .86 6.37 8
2005 .82 .82 6.38 8
===========================================================================
* Rounds to less than $.01 per share.
** Annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; Net Investment Income ratios reflect income earned and
expenses incurred on assets attributable to Preferred shares.
(a) Total Return Based on Market Value 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.
Total Return Based on Common Share Net Asset Value is the combination of
changes in Common share net asset value, reinvested dividend income at net
asset value and reinvested capital gains distributions at net asset value,
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 net asset value. 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 net asset value), and therefore may be different
from the price used in the calculation. Total returns are not annualized.
(b) After expense reimbursement from the Adviser, where applicable. Expense
ratios do not reflect the reduction of custodian fee credits earned on the
Fund's net cash on deposit with the custodian bank, where applicable.
(c) The expense ratios reflect, among other things, 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 Footnote 1 - Inverse Floating
Rate Securities.
(d) For the seven months ended February 28, 2009.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 85
| Financial
| Highlights (continued)
Selected data for a Common share outstanding throughout each period:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------------------------------- ------------------------------
DISTRIBUTIONS DISTRIBUTIONS
FROM NET FROM NET
BEGINNING INVESTMENT CAPITAL INVESTMENT CAPITAL
COMMON NET INCOME TO GAINS TO INCOME TO GAINS TO
SHARE NET REALIZED/ PREFERRED PREFERRED COMMON COMMON
NET ASSET INVESTMENT UNREALIZED SHARE- SHARE- SHARE- SHARE-
VALUE INCOME GAIN (LOSS) HOLDERS+ HOLDERS+ TOTAL HOLDERS HOLDERS TOTAL
==================================================================================================================================
OHIO QUALITY INCOME (NUO)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $14.56 $1.01 $1.42 $(.04) $ -- $2.39 $(.80) $ -- $(.80)
2009(d) 15.04 .56 (.52) (.13) -- (.09) (.39) -- (.39)
Year Ended 7/31:
2008 15.81 .95 (.71) (.25) (.02) (.03) (.67) (.07) (.74)
2007 16.01 .96 (.12) (.26) (.01) .57 (.73) (.04) (.77)
2006 16.58 .98 (.42) (.22) (.01) .33 (.85) (.05) (.90)
2005 16.21 1.02 .49 (.12) -- 1.39 (.98) (.04) (1.02)
OHIO DIVIDEND ADVANTAGE (NXI)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 13.83 .96 1.17 (.04) -- 2.09 (.77) -- (.77)
2009(d) 14.25 .54 (.46) (.12) -- (.04) (.38) -- (.38)
Year Ended 7/31:
2008 14.87 .93 (.55) (.23) (.03) .12 (.65) (.09) (.74)
2007 15.02 .94 (.09) (.24) (.01) .60 (.72) (.03) (.75)
2006 15.55 .96 (.40) (.21) -- .35 (.85) (.03) (.88)
2005 15.05 1.00 .57 (.11) -- 1.46 (.96) -- (.96)
==================================================================================================================================
DISCOUNT OFFERING
FROM COSTS AND PREFERRED SHARES AT END OF PERIOD
COMMON PREFERRED ENDING --------------------------------------
SHARES SHARE COMMON AGGREGATE LIQUIDATION
REPURCHASED UNDER- SHARE ENDING AMOUNT AND MARKET ASSET
AND WRITING NET ASSET MARKET OUTSTANDING VALUE COVERAGE
RETIRED DISCOUNTS VALUE VALUE (000) PER SHARE PER SHARE
==============================================================================================================
OHIO QUALITY INCOME (NUO)
--------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $-- $-- $16.15 $15.58 $73,000 $25,000 $78,917
2009(d) -- -- 14.56 12.90 77,000 25,000 71,066
Year Ended 7/31:
2008 -- -- 15.04 13.40 77,000 25,000 72,603
2007 -- -- 15.81 14.43 77,000 25,000 75,017
2006 -- -- 16.01 15.83 77,000 25,000 75,658
2005 -- -- 16.58 16.96 77,000 25,000 77,267
OHIO DIVIDEND ADVANTAGE (NXI)
--------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 --* -- 15.15 14.48 29,000 25,000 80,423
2009(d) -- -- 13.83 12.10 31,000 25,000 72,332
Year Ended 7/31:
2008 -- -- 14.25 12.77 31,000 25,000 73,770
2007 -- -- 14.87 14.39 31,000 25,000 75,898
2006 -- -- 15.02 15.05 31,000 25,000 76,400
2005 -- -- 15.55 17.00 31,000 25,000 78,123
==============================================================================================================
86 Nuveen Investments
RATIOS/SUPPLEMENTAL DATA
----------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
TOTAL RETURNS BEFORE REIMBURSEMENT++
------------------- -----------------------------------
BASED ENDING
ON NET
BASED COMMON ASSETS
ON SHARE NET APPLICABLE EXPENSES EXPENSES NET
MARKET ASSET TO COMMON INCLUDING EXCLUDING INVESTMENT
VALUE(a) VALUE(a) SHARES (000) INTEREST(c) INTEREST INCOME
======================================================================================================
OHIO QUALITY INCOME (NUO)
------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 27.57% 16.76% $157,439 1.20% 1.20% 6.51%
2009(d) (0.71) (0.49) 141,883 1.35** 1.31** 6.77**
Year Ended 7/31:
2008 (2.18) (.26) 146,617 1.42 1.26 6.08
2007 (4.25) 3.56 154,052 1.29 1.19 5.94
2006 (1.36) 2.10 156,026 1.20 1.20 6.05
2005 10.25 8.70 160,982 1.19 1.19 6.16
OHIO DIVIDEND ADVANTAGE (NXI)
------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 26.70 15.46 64,290 1.21 1.21 6.47
2009(d) (2.08) (0.15) 58,692 1.35** 1.31** 6.64**
Year Ended 7/31:
2008 (6.21) .83 60,475 1.39 1.24 6.06
2007 .52 4.02 63,114 1.32 1.22 5.85
2006 (6.53) 2.32 63,735 1.21 1.21 5.85
2005 21.79 9.87 65,873 1.21 1.21 6.00
======================================================================================================
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
AFTER REIMBURSEMENT++(b)
-----------------------------------
EXPENSES EXPENSES NET PORTFOLIO
INCLUDING EXCLUDING INVESTMENT TURNOVER
INTEREST(c) INTEREST INCOME RATE
=========================================================================
OHIO QUALITY INCOME (NUO)
-------------------------------------------------------------------------
Year Ended 2/28:
2010 1.20% 1.20% 6.51% 6%
2009(d) 1.35** 1.31** 6.77** 10
Year Ended 7/31:
2008 1.42 1.26 6.08 14
2007 1.28 1.18 5.94 15
2006 1.20 1.20 6.05 9
2005 1.19 1.19 6.16 14
OHIO DIVIDEND ADVANTAGE (NXI)
-------------------------------------------------------------------------
Year Ended 2/28:
2010 1.06 1.06 6.62 7
2009(d) 1.12** 1.09** 6.87** 10
Year Ended 7/31:
2008 1.12 .97 6.33 17
2007 .97 .87 6.20 14
2006 .79 .79 6.27 6
2005 .77 .77 6.45 14
=========================================================================
* Rounds to less than $.01 per share.
** Annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; Net Investment Income ratios reflect income earned and
expenses incurred on assets attributable to Preferred shares.
(a) Total Return Based on Market Value 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.
Total Return Based on Common Share Net Asset Value is the combination of
changes in Common share net asset value, reinvested dividend income at net
asset value and reinvested capital gains distributions at net asset value,
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 net asset value. 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 net asset value), and therefore may be different
from the price used in the calculation. Total returns are not annualized.
(b) After expense reimbursement from the Adviser, where applicable. Expense
ratios do not reflect the reduction of custodian fee credits earned on the
Fund's net cash on deposit with the custodian bank, where applicable.
(c) The expense ratios reflect, among other things, 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 Footnote 1 - Inverse Floating
Rate Securities.
(d) For the seven months ended February 28, 2009.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 87
| Financial
| Highlights (continued)
Selected data for a Common share outstanding throughout each period:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------------------------------- ------------------------------
DISTRIBUTIONS DISTRIBUTIONS
FROM NET FROM NET
BEGINNING INVESTMENT CAPITAL INVESTMENT CAPITAL
COMMON NET INCOME TO GAINS TO INCOME TO GAINS TO
SHARE NET REALIZED/ PREFERRED PREFERRED COMMON COMMON
NET ASSET INVESTMENT UNREALIZED SHARE- SHARE- SHARE- SHARE-
VALUE INCOME GAIN (LOSS) HOLDERS+ HOLDERS+ TOTAL HOLDERS HOLDERS TOTAL
==================================================================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $13.06 $.93 $ 1.53 $(.04) $ -- $2.42 $(.74) $ -- $(.74)
2009(d) 13.87 .54 (.84) (.13) -- (.43) (.38) -- (.38)
Year Ended 7/31:
2008 14.64 .93 (.73) (.25) (.02) (.07) (.64) (.06) (.70)
2007 14.81 .92 (.10) (.25) (.01) .56 (.69) (.04) (.73)
2006 15.37 .93 (.41) (.22) (.01) .29 (.80) (.05) (.85)
2005 14.85 .95 .61 (.12) -- 1.44 (.90) (.02) (.92)
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 13.97 1.00 1.19 (.04) -- 2.15 (.79) -- (.79)
2009(d) 14.33 .55 (.39) (.12) -- .04 (.40) -- (.40)
Year Ended 7/31:
2008 14.92 .95 (.56) (.23) (.02) .14 (.67) (.06) (.73)
2007 15.06 .96 (.08) (.25) (.01) .62 (.72) (.04) (.76)
2006 15.57 .95 (.45) (.22) -- .28 (.79) -- (.79)
2005 14.93 .95 .69 (.11) -- 1.53 (.87) (.02) (.89)
==================================================================================================================================
DISCOUNT OFFERING
FROM COSTS AND PREFERRED SHARES AT END OF PERIOD
COMMON PREFERRED ENDING -------------------------------------
SHARES SHARE COMMON AGGREGATE LIQUIDATION
REPURCHASED UNDER- SHARE ENDING AMOUNT AND MARKET ASSET
AND WRITING NET ASSET MARKET OUTSTANDING VALUE COVERAGE
RETIRED DISCOUNTS VALUE VALUE (000) PER SHARE PER SHARE
==============================================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
--------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 $ -- $ -- $14.74 $13.85 $21,600 $25,000 $78,241
2009(d) -- -- 13.06 11.58 23,100 25,000 69,107
Year Ended 7/31:
2008 -- -- 13.87 12.37 24,000 25,000 70,090
2007 -- -- 14.64 13.80 24,000 25,000 72,598
2006 -- -- 14.81 14.70 24,000 25,000 73,169
2005 -- -- 15.37 15.48 24,000 25,000 74,935
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
--------------------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 --* -- 15.33 15.20 15,500 25,000 78,325
2009(d) -- -- 13.97 11.95 16,500 25,000 70,647
Year Ended 7/31:
2008 -- -- 14.33 12.91 16,500 25,000 71,881
2007 -- -- 14.92 14.35 16,500 25,000 73,778
2006 -- -- 15.06 14.75 16,500 25,000 74,252
2005 -- -- 15.57 15.90 16,500 25,000 75,918
==============================================================================================================
88 Nuveen Investments
RATIOS/SUPPLEMENTAL DATA
-----------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
TOTAL RETURNS BEFORE REIMBURSEMENT++
------------------- --------------------------------------
BASED ENDING
ON NET
BASED COMMON ASSETS
ON SHARE NET APPLICABLE EXPENSES EXPENSES NET
MARKET ASSET TO COMMON INCLUDING EXCLUDING INVESTMENT
VALUE(a) VALUE(a) SHARES (000) INTEREST(c) INTEREST INCOME
=====================================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
-----------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 26.62% 18.91% $46,000 1.27% 1.27% 6.49%
2009(d) (3.09) (3.01) 40,755 1.46** 1.42** 6.91**
Year Ended 7/31:
2008 (5.46) (.51) 43,286 1.46 1.30 6.10
2007 (1.26) 3.80 45,694 1.41 1.31 5.76
2006 .35 1.96 46,242 1.27 1.27 5.71
2005 11.63 9.90 47,937 1.23 1.23 5.71
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
-----------------------------------------------------------------------------------------------------
Year Ended 2/28:
2010 34.62 15.73 33,062 1.30 1.30 6.56
2009(d) (4.29) .36 30,127 1.46** 1.42** 6.63**
Year Ended 7/31:
2008 (5.13) .95 30,941 1.47 1.32 6.05
2007 2.32 4.06 32,194 1.41 1.31 5.85
2006 (2.33) 1.87 32,506 1.28 1.28 5.76
2005 17.60 10.40 33,606 1.27 1.27 5.68
=====================================================================================================
RATIOS/SUPPLEMENTAL DATA
---------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS
APPLICABLE TO COMMON SHARES
AFTER REIMBURSEMENT++(b)
-----------------------------------------
EXPENSES EXPENSES NET PORTFOLIO
INCLUDING EXCLUDING INVESTMENT TURNOVER
INTEREST(c) INTEREST INCOME RATE
==================================================================================
OHIO DIVIDEND ADVANTAGE 2 (NBJ)
----------------------------------------------------------------------------------
Year Ended 2/28:
2010 1.07% 1.07% 6.69% 8%
2009(d) 1.20** 1.16** 7.17** 5
Year Ended 7/31:
2008 1.14 .98 6.41 16
2007 1.02 .92 6.15 14
2006 .81 .81 6.16 8
2005 .78 .78 6.16 14
OHIO DIVIDEND ADVANTAGE 3 (NVJ)
----------------------------------------------------------------------------------
Year Ended 2/28:
2010 1.07 1.07 6.80 14
2009(d) 1.15** 1.12** 6.93** 9
Year Ended 7/31:
2008 1.12 .97 6.41 19
2007 .99 .89 6.27 19
2006 .83 .83 6.21 2
2005 .83 .83 6.12 3
==================================================================================
* Rounds to less than $.01 per share.
** Annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; Net Investment Income ratios reflect income earned and
expenses incurred on assets attributable to Preferred shares.
(a) Total Return Based on Market Value 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.
Total Return Based on Common Share Net Asset Value is the combination of
changes in Common share net asset value, reinvested dividend income at net
asset value and reinvested capital gains distributions at net asset value,
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 net asset value. 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 net asset value), and therefore may be different
from the price used in the calculation. Total returns are not annualized.
(b) After expense reimbursement from the Adviser, where applicable. Expense
ratios do not reflect the reduction of custodian fee credits earned on the
Fund's net cash on deposit with the custodian bank, where applicable.
(c) The expense ratios reflect, among other things, 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 Footnote 1 - Inverse Floating
Rate Securities.
(d) For the seven months ended February 28, 2009.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
Nuveen Investments 89
Board Members & Officers
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board
Members of the Funds. The number of board members of the Fund is currently
set at nine. None of the board members 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 board members and
officers of the Funds, their principal occupations and other affiliations
during the past five years, the number of portfolios each oversees and
other directorships they hold are set forth below.
----------------------------------------------------------------------------------------------------------------------------------
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
----------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o ROBERT P. BREMNER Private Investor and Management Consultant;
8/22/40 Chairman of Treasurer and Director, Humanities Council of
333 W. Wacker Drive the Board 1996 199 Washington, D.C.
Chicago, IL 60606 and Board Member
o JACK B. EVANS President, The Hall-Perrine Foundation, a
10/22/48 private philanthropic corporation (since
333 W. Wacker Drive Board Member 1999 199 1996); Director and Chairman, United Fire
Chicago, IL 60606 Group, a publicly held company; President Pro
Tem of the Board of Regents for the State of
Iowa University System; Director, Gazette
Companies; Life Trustee of Coe College and the
Iowa College Foundation; formerly, Director,
Alliant Energy; formerly, Director, Federal
Reserve Bank of Chicago; formerly, President
and Chief Operating Officer, SCI Financial
Group, Inc., a regional financial services
firm.
o WILLIAM C. HUNTER Dean, Tippie College of Business, University
3/6/48 of Iowa (since 2006); Director (since 2004) of
333 W. Wacker Drive Board Member 2004 199 Xerox Corporation; Director (since 2005), Beta
Chicago, IL 60606 Gamma Sigma International Honor Society;
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);
Director, SS&C Technologies, Inc. (May
2005-October 2005); formerly, Director
(1997-2007), Credit Research Center at
Georgetown University.
o DAVID J. KUNDERT Director, Northwestern Mutual Wealth
10/28/42 Management Company; retired (since 2004) as
333 W. Wacker Drive Board Member 2005 199 Chairman, JPMorgan Fleming Asset Management,
Chicago, IL 60606 President and CEO, Banc One Investment
Advisors Corporation, and President, One Group
Mutual Funds; prior thereto, Executive Vice
President, Banc One Corporation and Chairman
and CEO, Banc One Investment Management Group;
Member, Board of Regents, Luther College;
member of the Wisconsin Bar Association;
member of Board of Directors, Friends of
Boerner Botanical Gardens; member of Board of
Directors and member of Investment Committee,
Greater Milwaukee Foundation.
o WILLIAM J. SCHNEIDER Chairman of Miller-Valentine Partners Ltd., a
9/24/44 real estate investment company; formerly,
333 W. Wacker Drive Board Member 1997 199 Senior Partner and Chief Operating Officer
Chicago, IL 60606 (retired, 2004) of Miller-Valentine Group;
member, University of Dayton Business School
Advisory Council; member, Dayton Philharmonic
Orchestra Association; formerly, member,
Business Advisory Council, Cleveland Federal
Reserve Bank; formerly, Director, Dayton
Development Coalition.
90 Nuveen Investments
----------------------------------------------------------------------------------------------------------------------------------
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
----------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o JUDITH M. STOCKDALE Executive Director, Gaylord and Dorothy
12/29/47 Donnelley Foundation (since 1994); prior
333 W. Wacker Drive Board Member 1997 199 thereto, Executive Director, Great Lakes
Chicago, IL 60606 Protection Fund (from 1990 to 1994).
o CAROLE E. STONE Director, Chicago Board Options Exchange
6/28/47 (since 2006); Director, C2 Options Exchange,
333 W. Wacker Drive Board Member 2007 199 Incorporated (since 2009); Commissioner, New
Chicago, IL 60606 York State Commission on Public Authority
Reform (since 2005); formerly, Chair, New York
Racing Association Oversight Board
(2005-2007).
o TERENCE J. TOTH Director, Legal & General Investment
9/29/59 Management America, Inc. (since 2008);
333 W. Wacker Drive Board Member 2008 199 Managing Partner, Promus Capital (since 2008);
Chicago, IL 60606 formerly, CEO and President, Northern Trust
Global Investments (2004-2007); Executive Vice
President, Quantitative Management &
Securities Lending (2000-2004); prior thereto,
various positions with Northern Trust Company
(since 1994); member: Goodman Theatre Board
(since 2004), Chicago Fellowship Boards (since
2005), University of Illinois Leadership
Council Board (since 2007) and Catalyst
Schools of Chicago Board (since 2008);
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).
INTERESTED BOARD MEMBER:
o JOHN P. AMBOIAN(2) Chief Executive Officer (since July 2007),
6/14/61 Director (since 1999) and Chairman (since
333 W. Wacker Drive Board Member 2008 199 2007) of Nuveen Investments, Inc.; Chief
Chicago, IL 60606 Executive Officer (since 2007) of Nuveen Asset
Management, Nuveen Investments Advisors, Inc.;
President (since 2005) of Nuveen Commodities
Asset Management, LLC.
Nuveen Investments 91
Board Members & Officers (continued)
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NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(3) BY OFFICER DURING PAST 5 YEARS
----------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o GIFFORD R. ZIMMERMAN Managing Director (since 2002), Assistant
9/9/56 Chief Secretary and Associate General Counsel of
333 W. Wacker Drive Administrative 1988 199 Nuveen Investments, LLC; Managing Director,
Chicago, IL 60606 Officer Associate General Counsel and Assistant
Secretary, of Nuveen Asset Management (since
2002) and of Symphony Asset Management LLC,
(since 2003); Vice President and Assistant
Secretary of NWQ Investment Management
Company, LLC. (since 2002), Nuveen Investments
Advisers Inc. (since 2002), Tradewinds Global
Investors, LLC, and Santa Barbara Asset
Management, LLC (since 2006), Nuveen HydePark
Group LLC and Nuveen Investment Solutions,
Inc. (since 2007); Managing Director (since
2004) and Assistant Secretary (since 1994) of
Nuveen Investments, Inc.; Managing Director
(since 2005) of Nuveen Commodities Asset
Management, LLC; Chartered Financial Analyst.
o WILLIAM ADAMS IV Executive Vice President of Nuveen
6/9/55 Investments, Inc.; Executive Vice President,
333 W. Wacker Drive Vice President 2007 124 U.S. Structured Products of Nuveen
Chicago, IL 60606 Investments, LLC, (since 1999), ; Executive
Vice President (since 2005) of Nuveen
Commodities Asset Management, LLC.
o CEDRIC H. ANTOSIEWICZ Managing Director, (since 2004), previously,
1/11/62 Vice President (1993-2004) of Nuveen
333 W. Wacker Drive Vice President 2007 124 Investments, LLC.
Chicago, IL 60606
o NIZIDA ARRIAGA Senior Vice President of Nuveen Investments,
6/1/68 LLC (since 2010); formerly, Vice President
333 W. Wacker Drive Vice President 2009 199 (2007-2010); previously, Portfolio Manager,
Chicago, IL 60606 Allstate Investments, LLC (1996-2006);
Chartered Financial Analyst.
o MICHAEL T. ATKINSON Vice President (since 2002) of Nuveen
2/3/66 Vice President Investments, LLC.; Vice President of Nuveen
333 W. Wacker Drive and Assistant 2000 199 Asset Management (since 2005).
Chicago, IL 60606 Secretary
o MARGO L. COOK Executive Vice President (since Oct 2008) of
4/11/64 Nuveen Investments, Inc.; previously, Head of
333 W. Wacker Drive Vice President 2009 199 Institutional Asset Management (2007-2008) of
Chicago, IL 60606 Bear Stearns Asset Management; Head of
Institutional Asset Mgt (1986-2007) of Bank of
NY Mellon; Chartered Financial Analyst.
o LORNA C. FERGUSON Managing Director (since 2004) of Nuveen
10/24/45 Investments, LLC and Managing Director (since
333 W. Wacker Drive Vice President 1998 199 2005) of Nuveen Asset Management.
Chicago, IL 60606
o STEPHEN D. FOY Vice President (since 1993) and Funds
5/31/54 Vice President Controller (since 1998) of Nuveen Investments,
333 W. Wacker Drive and Controller 1998 199 LLC; Vice President (since 2005) of Nuveen
Chicago, IL 60606 Asset Management; Certified Public Accountant.
o SCOTT S. GRACE Managing Director, Corporate Finance &
8/20/70 Vice President Development, Treasurer (since September 2009)
333 W. Wacker Drive and Treasurer 2009 199 of Nuveen Investments, LLC; Managing Director
Chicago, IL 60606 and Treasurer of Nuveen Asset Management
(since 2009); formerly, Treasurer (2006-2009),
Senior Vice President (2008-2009), previously,
Vice President (2006-2008) of Janus Capital
Group, Inc.; formerly. Senior Associate in
Morgan Stanley's Global Financial Services
Group (2000-2003); Chartered Accountant
Designation.
92 Nuveen Investments
----------------------------------------------------------------------------------------------------------------------------------
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(3) BY OFFICER DURING PAST 5 YEARS
----------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o WILLIAM T. HUFFMAN Chief Operating Officer, Municipal Fixed
5/7/69 Income (since 2008) of Nuveen Asset
333 W. Wacker Drive Vice President 2009 135 Management; previously, Chairman, President
Chicago, IL 60606 and Chief Executive Officer (2002 - 2007) of
Northern Trust Global Advisors, Inc. and Chief
Executive Officer (2007) of Northern Trust
Global Investments Limited; Certified Public
Accountant.
o WALTER M. KELLY Senior Vice President (since 2008), Vice
2/24/70 Chief Compliance President (2006-2008) formerly, Assistant Vice
333 W. Wacker Drive Officer and 2003 199 President and Assistant General Counsel
Chicago, IL 60606 Vice President (2003-2006) of Nuveen Investments, LLC; Senior
Vice President (since 2008), formerly, Vice
President (2006-2008) and Assistant Secretary
(since 2008) of Nuveen Asset Management.
o DAVID J. LAMB Senior Vice President (since 2009), formerly,
3/22/63 Vice President (2000-2009) of Nuveen
333 W. Wacker Drive Vice President 2000 199 Investments, LLC; Vice President (since 2005)
Chicago, IL 60606 of Nuveen Asset Management; Certified Public
Accountant.
o TINA M. LAZAR Senior Vice President (since 2009), formerly,
8/27/61 Vice President of Nuveen Investments, LLC
333 W. Wacker Drive Vice President 2002 199 (1999-2009); Vice President of Nuveen Asset
Chicago, IL 60606 Management (since 2005).
o LARRY W. MARTIN Senior Vice President (since 2010), Assistant
7/27/51 Vice President Secretary and Assistant General Counsel of
333 W. Wacker Drive and Assistant 1988 199 Nuveen Investments, LLC; Vice President (since
Chicago, IL 60606 Secretary 2005) and Assistant Secretary of Nuveen
Investments, Inc.; Vice President (since 2005)
and Assistant Secretary (since 1997) of Nuveen
Asset Management; Vice President and Assistant
Secretary of Nuveen Investments Advisers Inc.
(since 2002); NWQ Investment Management
Company, LLC (since 2002), Symphony Asset
Management LLC (since 2003), Tradewinds Global
Investors, LLC, Santa Barbara Asset Management
LLC (since 2006) and of Nuveen HydePark Group,
LLC and Nuveen Investment Solutions, Inc.
(since 2007).
o KEVIN J. MCCARTHY Managing Director (since 2008), formerly, Vice
3/26/66 Vice President President (2007-2008), Nuveen Investments,
333 W. Wacker Drive and Secretary 2007 199 LLC; Managing Director (since 2008), formerly,
Chicago, IL 60606 Vice President, and Assistant Secretary,
Nuveen Asset Management, and Nuveen
Investments Holdings, Inc.; Vice President
(since 2007) and Assistant Secretary, Nuveen
Investment Advisers Inc., Nuveen Investment
Institutional Services Group LLC, NWQ
Investment Management Company, LLC, Tradewinds
Global Investors LLC, NWQ Holdings, LLC,
Symphony Asset Management LLC, Santa Barbara
Asset Management LLC, Nuveen HydePark Group,
LLC and Nuveen Investment Solutions, Inc.
(since 2007); prior thereto, Partner, Bell,
Boyd & Lloyd LLP (1997-2007).
o JOHN V. MILLER Chief Investment Officer and Managing Director
4/10/67 (since 2007), formerly, Vice President
333 W. Wacker Drive Vice President 2007 135 (2002-2007) of Nuveen Asset Management and
Chicago, IL 60606 Managing Director (since 2007), formerly Vice
President (2002-2007) Nuveen Investments, LLC;
Chartered Financial Analyst.
Nuveen Investments 93
Board Members & Officers (continued)
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NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(3) BY OFFICER DURING PAST 5 YEARS
----------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o GREGORY MINO Senior Vice President (since 2010) of Nuveen
1/4/71 Investments, LLC, formerly Vice President
333 W. Wacker Drive Vice President 2009 199 (2008-2010); previously, Director (2004-2007)
Chicago, IL 60606 and Executive Director (2007-2008) of UBS
Global Asset Management; previously, Vice
President (2000-2003) and Director (2003-2004)
of Merrill Lynch Investment Managers;
Chartered Financial Analyst.
o CHRISTOPHER M. ROHRBACHER Vice President, Nuveen Investments, LLC (since
8/1/71 Vice President 2008); Vice President and Assistant Secretary,
333 W. Wacker Drive and Assistant 2008 199 Nuveen Asset Management (since 2008); prior
Chicago, IL 60606 Secretary thereto, Associate, Skadden, Arps, Slate
Meagher & Flom LLP (2002-2008).
o JAMES F. RUANE Vice President, Nuveen Investments, LLC (since
7/3/62 Vice President 2007); prior thereto, Partner, Deloitte &
333 W. Wacker Drive and Assistant 2007 199 Touche USA LLP (2005-2007), formerly, senior
Chicago, IL 60606 Secretary tax manager (2002-2005); Certified Public
Accountant.
o MARK L. WINGET Vice President, Nuveen Investments, LLC (since
12/21/68 Vice President 2008); Vice President and Assistant Secretary,
333 W. Wacker Drive and Assistant 2008 199 Nuveen Asset Management (since 2008); prior
Chicago, IL 60606 Secretary thereto, Counsel, Vedder Price P.C.
(1997-2007).
(1) For Michigan Dividend Advantage (NZW), Ohio Dividend Advantage (NXI), Ohio
Dividend Advantage 2 (NBJ) and Ohio Dividend Advantage 3 (NVJ) Board
Members serve three year terms, except for two board members who are
elected by the holders of Preferred Shares. The Board of Trustees for NZW,
NXI, NBJ and NVJ is divided into three classes, Class I, Class II, and
Class III, 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 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. For Michigan Quality Income (NUM), Michigan
Premium Income (NMP) and Ohio Quality Income (NUO), the Board Members
serve a one year term to serve until the next annual meeting or until
their successors shall have been duly elected and qualified. The first
year elected or appointed represents the year in which the board member
was first elected or appointed to any fund in the Nuveen Complex.
(2) Mr. Amboian is an interested trustee because of his position with Nuveen
Investments, Inc. and certain of its subsidiaries, which are affiliates of
the Nuveen Funds.
(3) Officers serve one year terms through July of each year. 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.
94 Nuveen Investments
Annual Investment Management Agreement Approval Process
The Investment Company Act of 1940, as amended (the "1940 ACT"), provides, in
substance, that each investment advisory agreement between a fund and its
investment adviser will continue in effect from year to year only if its
continuance is approved at least annually by the fund's board members, including
by a vote of a majority of the board members who are not parties to the advisory
agreement or "interested persons" of any parties (the "INDEPENDENT BOARD
MEMBERS"), cast in person at a meeting called for the purpose of considering
such approval. In connection with such approvals, the fund's board members must
request and evaluate, and the investment adviser is required to furnish, such
information as may be reasonably necessary to evaluate the terms of the advisory
agreement. Accordingly, at a meeting held on May 27-29, 2009 (the "MAY
MEETING"), the Boards of Trustees or Directors (as the case may be) (each a
"BOARD" and each Trustee or Director, a "BOARD MEMBER") of the Funds, including
a majority of the Independent Board Members, considered and approved the
continuation of the advisory agreements (each an "ADVISORY AGREEMENT") between
each Fund and Nuveen Asset Management ("NAM") for an additional one-year period.
In preparation for their considerations at the May Meeting, the Board also held
a separate meeting on April 21-22, 2009 (the "APRIL MEETING"). Accordingly, the
factors considered and determinations made regarding the renewals by the
Independent Board Members include those made at the April Meeting.
In addition, in evaluating the Advisory Agreements, the Independent Board
Members reviewed a broad range of information relating to the Funds and NAM,
including absolute performance, fee and expense information for the Funds as
well as comparative performance, fee and expense information for a comparable
peer group of funds, the performance information of recognized and/or customized
benchmarks (as applicable) of the Funds, the profitability of Nuveen for its
advisory activities (which includes its wholly owned subsidiaries other than
Winslow Capital Management, Inc. ("WINSLOW CAPITAL"), which was recently
acquired in December 2008), and other information regarding the organization,
personnel, and services provided by NAM. The Independent Board Members also met
quarterly as well as at other times as the need arose during the year and took
into account the information provided at such meetings and the knowledge gained
therefrom. Prior to approving the renewal of the Advisory Agreements, the
Independent Board Members reviewed the foregoing information with their
independent legal counsel and with management, reviewed materials from
independent legal counsel describing applicable law and their duties in
reviewing advisory contracts, and met with independent legal counsel in private
sessions without management present. The Independent Board Members considered
the legal advice provided by independent legal counsel and relied upon their
knowledge of NAM, its services and the Funds resulting from their meetings and
other interactions throughout the year and their own business judgment in
determining the factors to be considered in evaluating
Nuveen Investments 95
Annual Investment Management Agreement Approval Process (continued)
the Advisory Agreements. Each Board Member may have accorded different weight to
the various factors in reaching his or her conclusions with respect to a Fund's
Advisory Agreement. The Independent Board Members did not identify any single
factor as all-important or controlling. The Independent Board Members'
considerations were instead based on a comprehensive consideration of all the
information presented. The principal factors considered by the Board and its
conclusions are described below.
A. NATURE, EXTENT AND QUALITY OF SERVICES
In considering renewal of the Advisory Agreements, the Independent Board Members
considered the nature, extent and quality of NAM's services, including advisory
services and administrative services. The Independent Board Members reviewed
materials outlining, among other things, NAM's organization and business; the
types of services that NAM or its affiliates provide and are expected to provide
to the Funds; the performance record of the applicable Fund (as described in
further detail below); and any initiatives Nuveen had taken for the applicable
fund product line.
In reviewing the services provided and the initiatives undertaken during the
past year, the Independent Board Members recognized the severe market turmoil
experienced in the capital markets during recent periods, including sustained
periods of high volatility, credit disruption and government intervention. The
Independent Board Members considered NAM's efforts, expertise and other actions
taken to address matters as they arose that impacted the Funds. The Independent
Board Members recognized the role of the Investment Services group which, among
other things, monitors the various positions throughout the Nuveen fund complex
to identify and address any systematic risks. In addition, the Capital Markets
Committee of NAM provides a multi-departmental venue for developing new policies
to mitigate any risks. The Independent Board Members further recognized NAM's
continuous review of the Nuveen funds' investment strategies and mandates in
seeking to continue to refine and improve the investment process for the funds,
particularly in light of market conditions. With respect to closed-end funds
that issued auction rate preferred shares ("ARPS") or that otherwise utilize
leverage, the Independent Board Members noted, in particular, NAM's efforts in
refinancing the preferred shares of such funds frozen by the collapse of the
auction rate market and managing leverage during a period of rapid market
declines, particularly for the non-equity funds. Such efforts included
negotiating and maintaining the availability of bank loan facilities and other
sources of credit used for investment purposes or to satisfy liquidity needs,
liquidating portfolio securities during difficult times to meet leverage ratios,
and seeking alternative forms of debt and other leverage that may over time
reduce financing costs associated with ARPs and enable the funds that have
issued ARPs to restore liquidity to ARPs holders. The Independent Board Members
also noted Nuveen's continued commitment and efforts to keep investors and
financial advisers informed as to its progress with the ARPs through, among
other things, conference calls, emails, press releases, information posted on
its website, and telephone calls and in-person meetings with financial advisers.
In addition to the foregoing, the Independent Board Members also noted the
additional services that NAM or its affiliates provide to closed-end funds,
including, in particular, Nuveen's continued commitment to supporting the
secondary market for the common shares of its closed-end funds through a
96 Nuveen Investments
variety of programs designed to raise investor and analyst awareness and
understanding of closed-end funds. These efforts include maintaining an investor
relations program to provide timely information and education to financial
advisers and investors; providing advertising and marketing for the closed-end
funds; maintaining websites; and providing educational seminars.
As part of their review, the Independent Board Members also evaluated the
background, experience and track record of NAM's investment personnel. In this
regard, the Independent Board Members considered any changes in the personnel,
and the impact on the level of services provided to the Funds, if any. The
Independent Board Members also reviewed information regarding portfolio manager
compensation arrangements to evaluate NAM's ability to attract and retain high
quality investment personnel, preserve stability, and reward performance but not
provide an incentive for taking undue risks.
In addition to advisory services, the Independent Board Members considered the
quality of administrative services provided by NAM and its affiliates including
product management, fund administration, oversight of service providers,
shareholder services, administration of Board relations, regulatory and
portfolio compliance and legal support. Given the importance of compliance, the
Independent Board Members considered NAM's compliance program, including the
report of the chief compliance officer regarding the Funds' compliance policies
and procedures.
Based on their review, the Independent Board Members found that, overall, the
nature, extent and quality of services provided (and expected to be provided) to
the respective Funds under the Advisory Agreements were satisfactory.
B. THE INVESTMENT PERFORMANCE OF THE FUNDS AND NAM
The Board considered the investment performance of each Fund, including the
Fund's historic performance as well as its performance compared to funds with
similar investment objectives (the "PERFORMANCE PEER GROUP") based on data
provided by an independent provider of mutual fund data as well as recognized
and/or customized benchmarks (as applicable). The Independent Board Members
reviewed performance information including, among other things, total return
information compared with the Fund's Performance Peer Group and recognized
and/or customized benchmarks (as applicable) for the quarter-, one-, three- and
five-year periods (as applicable) ending December 31, 2008 and for the same
periods (as applicable) ending March 31, 2009. The Independent Board Members
also reviewed performance information of the Nuveen municipal funds managed by
NAM in the aggregate ranked by peer group and the performance of such funds, in
the aggregate, relative to their benchmark. This information supplemented the
Fund performance information provided to the Board at each of its quarterly
meetings.
In comparing a fund's performance with that of its Performance Peer Group, the
Independent Board Members took into account that the closest Performance Peer
Group in certain instances may not adequately reflect the respective fund's
investment objectives and strategies thereby hindering a meaningful comparison
of the fund's performance with that of the Performance Peer Group. The
Independent Board Members further considered the performance of the Funds in the
context of the volatile
Nuveen Investments 97
Annual Investment Management Agreement Approval Process (continued)
market conditions during the past year, and their impact on various asset
classes and the portfolio management of the Funds.
Based on their review and factoring in the severity of market turmoil in 2008,
the Independent Board Members determined that each Fund's investment performance
over time had been satisfactory.
C. FEES, EXPENSES AND PROFITABILITY
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund
reviewing, among other things, such Fund's gross management fees, net
management fees and total expense ratios (before and after expense
reimbursements and/or waivers) in absolute terms as well as compared to
the fee and expenses of a comparable universe of unaffiliated funds based
on data provided by an independent fund data provider (the "PEER
UNIVERSE") and in certain cases, to a more focused subset of funds in the
Peer Universe (the "PEER GROUP").
The Independent Board Members further reviewed data regarding the
construction of the applicable Peer Universe and Peer Group. In reviewing
the comparisons of fee and expense information, the Independent Board
Members took into account that in certain instances various factors such
as the asset level of a fund relative to peers, the size and particular
composition of the Peer Universe or Peer Group, the investment objectives
of the peers, expense anomalies, changes in the funds comprising the Peer
Universe or Peer Group from year to year, levels of reimbursement and the
timing of information used may impact the comparative data, thereby
limiting the ability to make a meaningful comparison. In addition, the
Independent Board Members also considered, among other things, the
differences in the use and type of leverage compared to the peers. The
Independent Board Members also considered the differences in the states
reflected in the respective Peer Group. In reviewing the fee schedule for
a Fund, the Independent Board Members also considered the fund-level and
complex-wide breakpoint schedules (described in further detail below) and
any fee waivers and reimbursements provided by Nuveen (applicable, in
particular, for certain closed-end funds launched since 1999).
Based on their review of the fee and expense information provided, the
Independent Board Members determined that each Fund's management fees and
net total expense ratio were reasonable in light of the nature, extent and
quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the
nature of services and fee rates offered by NAM to other clients. Such
other clients include NAM's municipal separately managed accounts. In
evaluating the comparisons of fees, the Independent Board Members noted
that the fee rates charged to the Funds and other clients vary, among
other things, because of the different services involved and the
additional regulatory and compliance requirements associated with
registered investment companies, such as the Funds. Accordingly, the
Independent Board Members considered the differences in the product types,
including, but not limited
98 Nuveen Investments
to, the services provided, the structure and operations, product
distribution and costs thereof, portfolio investment policies, investor
profiles, account sizes and regulatory requirements. The Independent Board
Members noted, in particular, that the range of services provided to the
Funds (as discussed above) is much more extensive than that provided to
separately managed accounts. Given the inherent differences in the
products, particularly the extensive services provided to the Funds, the
Independent Board Members believe such facts justify the different levels
of fees.
3. Profitability of Nuveen
In conjunction with its review of fees, the Independent Board Members also
considered the profitability of Nuveen for its advisory activities (which
incorporated Nuveen's wholly-owned affiliated sub-advisers other than
Winslow Capital) and its financial condition. The Independent Board
Members reviewed the revenues and expenses of Nuveen's advisory activities
for the last two years, the allocation methodology used in preparing the
profitability data and an analysis of the key drivers behind the changes
in revenues and expenses that impacted profitability in 2008. In addition,
the Independent Board Members reviewed information regarding the financial
results of Nuveen for 2008 based on its Form 8-K filed on March 31, 2009.
The Independent Board Members noted this information supplemented the
profitability information requested and received during the year to help
keep them apprised of developments affecting profitability (such as
changes in fee waivers and expense reimbursement commitments). In this
regard, the Independent Board Members noted that they had also appointed
an Independent Board Member as a point person to review and keep them
apprised of changes to the profitability analysis and/or methodologies
during the year. The Independent Board Members also considered Nuveen's
revenues for advisory activities, expenses, and profit margin compared to
that of various unaffiliated management firms with similar amounts of
assets under management and relatively comparable asset composition
prepared by Nuveen.
In reviewing profitability, the Independent Board Members recognized the
subjective nature of determining profitability which may be affected by
numerous factors including the allocation of expenses. Further, the
Independent Board Members recognized the difficulties in making
comparisons as the profitability of other advisers generally is not
publicly available and the profitability information that is available for
certain advisers or management firms may not be representative of the
industry and may be affected by, among other things, the adviser's
particular business mix, capital costs, types of funds managed and expense
allocations. Notwithstanding the foregoing, the Independent Board Members
reviewed Nuveen's methodology and assumptions for allocating expenses
across product lines to determine profitability. In reviewing
profitability, the Independent Board Members recognized Nuveen's
investment in its fund business.
Based on their review, the Independent Board Members concluded that
Nuveen's level of profitability for its advisory activities was reasonable
in light of the services provided.
Nuveen Investments 99
Annual Investment Management Agreement Approval Process (continued)
In evaluating the reasonableness of the compensation, the Independent
Board Members also considered other amounts paid to NAM by the Funds as
well as any indirect benefits (such as soft dollar arrangements, if any)
NAM and its affiliates receive, or are expected to receive, that are
directly attributable to the management of the Funds, if any. See Section
E below for additional information on indirect benefits NAM may receive as
a result of its relationship with the Funds. Based on their review of the
overall fee arrangements of each Fund, the Independent Board Members
determined that the advisory fees and expenses of the respective Fund were
reasonable.
D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE
With respect to economies of scale, the Independent Board Members have
recognized the potential benefits resulting from the costs of a fund being
spread over a larger asset base, although economies of scale are difficult to
measure and predict with precision, particularly on a fund-by-fund basis. One
method to help ensure the shareholders share in these benefits is to include
breakpoints in the advisory fee schedule. Generally, management fees for funds
in the Nuveen complex are comprised of a fund-level component and a
complex-level component, subject to certain exceptions. Accordingly, the
Independent Board Members reviewed and considered the applicable fund-level
breakpoints in the advisory fee schedules that reduce advisory fees as asset
levels increase. In this regard, the Independent Board Members noted that
although closed-end funds may from time-to-time make additional share offerings,
the growth of their assets will occur primarily through the appreciation of such
funds' investment portfolio. While economies of scale result when costs can be
spread over a larger asset base, the Independent Board Members also recognized
that the asset levels generally declined in 2008 due to, among other things, the
market downturn. Accordingly, for funds with a reduction in assets under
management, advisory fee levels may have increased as breakpoints in the fee
schedule were no longer surpassed.
In addition to fund-level advisory fee breakpoints, the Board also considered
the Funds' complex-wide fee arrangement. Pursuant to the complex-wide fee
arrangement, the fees of the funds in the Nuveen complex generally are reduced
as the assets in the fund complex reach certain levels. The complex-wide fee
arrangement seeks to provide the benefits of economies of scale to fund
shareholders when total fund complex assets increase, even if assets of a
particular fund are unchanged or have decreased. The approach reflects the
notion that some of Nuveen's costs are attributable to services provided to all
its funds in the complex and therefore all funds benefit if these costs are
spread over a larger asset base. Generally, the complex-wide pricing reduces
Nuveen's revenue because total complex fund assets have consistently grown in
prior years. As noted, however, total fund assets declined in 2008 resulting in
a smaller downward adjustment of revenues due to complex-wide pricing compared
to the prior year.
Based on their review, the Independent Board Members concluded that the
breakpoint schedules and complex-wide fee arrangement were acceptable and
reflect economies of scale to be shared with shareholders when assets under
management increase.
100 Nuveen Investments
E. INDIRECT BENEFITS
In evaluating fees, the Independent Board Members received and considered
information regarding potential "fall out" or ancillary benefits NAM or its
affiliates may receive as a result of its relationship with each Fund. In this
regard, the Independent Board Members considered revenues received by affiliates
of NAM for serving as agent at Nuveen's trading desk.
In addition to the above, the Independent Board Members considered whether NAM
received any benefits from soft dollar arrangements whereby a portion of the
commissions paid by a Fund for brokerage may be used to acquire research that
may be useful to NAM in managing the assets of the Funds and other clients. The
Independent Board Members noted that NAM does not currently have any soft dollar
arrangements; however, to the extent certain bona fide agency transactions that
occur on markets that traditionally trade on a principal basis and riskless
principal transactions are considered as generating "commissions," NAM intends
to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect
benefits received by NAM as a result of its relationship with the Funds were
reasonable and within acceptable parameters.
F. OTHER CONSIDERATIONS
The Independent Board Members did not identify any single factor discussed
previously as all-important or controlling. The Board Members, including the
Independent Board Members, unanimously concluded that the terms of the Advisory
Agreements are fair and reasonable, that NAM's fees are reasonable in light of
the services provided to each Fund and that the Advisory Agreements be renewed.
Nuveen Investments 101
Reinvest Automatically Easily and Conveniently
NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR
REINVESTMENT ACCOUNT.
NUVEEN CLOSED-END FUNDS DIVIDEND REINVESTMENT PLAN
Your Nuveen Closed-End Fund allows you to conveniently reinvest dividends and/or
capital gains 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 tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or 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 dividends and 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 net
asset value at the time of valuation, the Fund will issue new shares at the
greater of the net asset value or 95% of the then-current market price. If the
shares are trading at less than net asset value, shares for your account will be
purchased on the open market. If the Plan Agent begins purchasing Fund shares on
the open market while shares are trading below net asset value, but the Fund's
shares subsequently trade at or above their net asset value 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' net
asset value or 95% of the shares' market value on the last business day
immediately prior to the purchase date. Dividends and distributions received to
purchase shares in the open market will normally be invested shortly after the
dividend payment date. No interest will be paid on dividends and distributions
awaiting reinvestment. Because the market price of the shares may increase
before purchases are completed, the average purchase price
102 Nuveen Investments
per share may exceed the market price at the time of valuation, resulting in the
acquisition of fewer shares than if the dividend or 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 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. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
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 DIVIDENDS AND/OR DISTRIBUTIONS
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
Nuveen Investments 103
Glossary of Terms Used in this Report
o AUCTION RATE BOND: An auction rate bond is a security whose interest
payments are adjusted periodically through an auction process, which
process typically also serves as a means for buying and selling the bond.
Auctions that fail to attract enough buyers for all the shares offered for
sale are deemed to have "failed," with current holders receiving a
formula-based interest rate until the next scheduled auction.
o 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.
o AVERAGE EFFECTIVE MATURITY: The average of the number of years to maturity
of the bonds in a Fund's portfolio, computed by weighting each bond's time
to maturity (the date the security comes due) by the market value of the
security. This figure does not account for the likelihood of prepayments
or the exercise of call provisions unless an escrow account has been
established to redeem the bond before maturity. The market value weighting
for an investment in an inverse floating rate security is the value of the
portfolio's residual interest in the inverse floating rate trust, and does
not include the value of the floating rate securities issued by the trust.
o INVERSE FLOATERS: Inverse floating rate securities, also known as inverse
floaters, are created by depositing a municipal bond, typically with a
fixed interest rate, into a special purpose trust created by a
broker-dealer. 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.
104 Nuveen Investments
o LEVERAGE-ADJUSTED DURATION: Duration is a measure of the expected period
over which a bond's principal and interest will be paid, and consequently
is a measure of the sensitivity of a bond's or bond Fund's value to
changes when market interest rates change. Generally, the longer a bond's
or Fund's duration, the more the price of the bond or Fund will change as
interest rates change. Leverage-adjusted duration takes into account the
leveraging process for a Fund and therefore is longer than the duration of
the Fund's portfolio of bonds.
o MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An
investment's current annualized dividend divided by its current market
price.
o NET ASSET VALUE (NAV): A Fund's NAV per common share is calculated by
subtracting the liabilities of the Fund (including any Preferred shares
issued in order to leverage the Fund) from its total assets and then
dividing the remainder by the number of common shares outstanding. Fund
NAVs are calculated at the end of each business day.
o PRE-REFUNDING: 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.
o TAXABLE-EQUIVALENT YIELD: The yield necessary from a fully taxable
investment to equal, on an after-tax basis, the yield of a municipal bond
investment.
o ZERO COUPON BOND: A zero coupon bond does not pay a regular interest
coupon to its holders during the life of the bond. Tax-exempt 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.
Nuveen Investments 105
Notes
106 Nuveen Investments
Notes
Nuveen Investments 107
Notes
108 Nuveen Investments
Other Useful Information
QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
You may obtain (i) each Fund's quarterly portfolio of investments, (ii)
information regarding how the Funds voted proxies relating to portfolio
securities held during the twelve-month period ended June 30, 2009, and (iii) a
description of the policies and procedures that the Funds used to determine how
to vote proxies relating to portfolio securities without charge, upon request,
by calling Nuveen Investments toll-free at (800) 257-8787 or on Nuveen's website
at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities
and Exchange Commission ("SEC"). The SEC may charge a copying fee for this
information. Visit the SEC on-line at http://www.sec.gov or in person at the
SEC's Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090
for room hours and operation. You may also request Fund information by sending
an e-mail request to publicinfo@sec.gov or by writing to the SEC's Public
References Section at 100 F Street NE, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer 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 Chief Executive
Officer and Chief Financial Officer required by Section 302 of the
Sarbanes-Oxley Act.
COMMON AND PREFERRED SHARE INFORMATION
Each Fund intends to repurchase and/or redeem shares of its own common and/or
preferred stock in the future at such times and in such amounts as is deemed
advisable. During the period covered by this report, the Funds repurchased
and/or redeemed shares of their common and/or preferred stock as shown in the
accompanying table.
COMMON SHARES PREFERRED SHARES
FUND REPURCHASED REDEEMED
NUM 153,900 143
NMP 110,400 92
NZW 12,200 26
NUO -- 160
NXI -- 80
NBJ -- 60
NVJ -- 40
Any future repurchases and/or redemptions will be reported to shareholders in
the next annual or semi-annual report.
BOARD OF DIRECTORS/TRUSTEES
John P. Amboian
Robert P. Bremner
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Judith M. Stockdale
Carole E. Stone
Terence J. Toth
FUND MANAGER
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
TRANSFER AGENT AND SHAREHOLDER SERVICES
State Street Bank & Trust Company
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
Chicago, IL
Nuveen Investments 109
Nuveen Investments:
Serving Investors for Generations
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions through continued
adherence to proven, longterm investing principles. Today, we offer a range of
high quality equity and fixed-income solutions designed to be integral
components of a well-diversified core portfolio.
FOCUSED ON MEETING INVESTOR NEEDS.
Nuveen Investments is a global investment management firm that seeks to help
secure the long-term goals of institutions and high net worth investors as well
as the consultants and financial advisors who serve them. We market our growing
range of specialized investment solutions under the high-quality brands of
HydePark, NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds and Winslow Capital.
In total, Nuveen Investments managed approximately $145 billion of assets on
December 31, 2009.
FIND OUT HOW WE CAN HELP YOU.
To learn more about how the products and services of Nuveen Investments may be
able to help you meet your financial goals, talk to your financial advisor, 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 INVESTMENTS, 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/CEF
o Share prices
o Fund details
o Daily financial news
o Investor education
o Interactive planning tools
Distributed by
Nuveen Investments, LLC
333 West Wacker Drive
Chicago, IL 60606
www.nuveen.com
EAN-C-0210D
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/CEF/Info/Shareholder.
(To view the code, click on Fund Governance and then click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
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 expert is Jack B. Evans, who is "independent" for purposes
of Item 3 of Form N-CSR.
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.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Nuveen Michigan Quality Income Municipal Fund, Inc.
The following tables show the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP the Audit Committee approved in advance all
audit services and non-audit services that Ernst & Young 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
Chairman (or, in his 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)
------------------------------------------------------------------------------------------------------------------------------------
February 28, 2010 $ 15,852 $ 0 $ 0 $ 3,400
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
February 28, 2009 (5) $ 15,986 $ 0 $ 0 $ 1,700
------------------------------------------------------------------------------------------------------------------------------------
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 and are not reported under "Audit Fees".
(3) "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
(4) "All Other Fees" are the aggregate fees billed for products and services
for agreed upon procedures engagements performed for leveraged funds.
(5) Fund changed fiscal year from July to February starting in 2009.
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 Ernst & Young LLP to
Nuveen Asset Management ("NAM" or the "Adviser"), and any entity controlling,
controlled by or under common control with NAM 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 Ernst & Young 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.
FISCAL YEAR ENDED 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
SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS
------------------------------------------------------------------------------------------------------------------------------------
February 28, 2010 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
February 28, 2009 (1) $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
(1) Fund changed fiscal year from July to February starting in 2009.
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young 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 Ernst & Young 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 Ernst & Young LLP about
any non-audit services that Ernst & Young 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 Ernst & Young LLP's
independence.
FISCAL YEAR ENDED 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
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
------------------------------------------------------------------------------------------------------------------------------------
February 28, 2010 $ 3,400 $ 0 $ 0 $ 3,400
February 28, 2009 (1) $ 1,700 $ 0 $ 0 $ 1,700
"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.
(1) Fund changed fiscal year from July to February starting in 2009.
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 chairman for his
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)). The members of the audit committee are
Robert P. Bremner, Jack B. Evans, Terence J. Toth, William J. Schneider and
David J. Kundert.
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.
The registrant invests its assets primarily in municipal bonds and cash
management securities. On rare occasions the registrant may acquire, directly or
through a special purpose vehicle, equity securities of a municipal bond issuer
whose bonds the registrant already owns when such bonds have deteriorated or are
expected shortly to deteriorate significantly in credit quality. The purpose of
acquiring equity securities generally will be to acquire control of the
municipal bond issuer and to seek to prevent the credit deterioration or
facilitate the liquidation or other workout of the distressed issuer's credit
problem. In the course of exercising control of a distressed municipal issuer,
NAM may pursue the registrant's interests in a variety of ways, which may entail
negotiating and executing consents, agreements and other arrangements, and
otherwise influencing the management of the issuer. NAM does not consider such
activities proxy voting for purposes of Rule 206(4)-6 under the 1940 Act, but
nevertheless provides reports to the registrant's Board on its control
activities on a quarterly basis.
In the rare event that a municipal issuer were to issue a proxy or that the
registrant were to receive a proxy issued by a cash management security, NAM
would either engage an independent third party to determine how the proxy should
be voted or vote the proxy with the consent, or based on the instructions, of
the registrant's Board or its representative. A member of NAM's legal department
would oversee the administration of the voting, and ensure that records were
maintained in accordance with Rule 206(4)-6, reports were filed with the SEC on
Form N-PX, and the results provided to the registrant's Board and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
THE PORTFOLIO MANAGER
The following individual has primary responsibility for the day-to-day
implementation of the registrant's investment strategies:
NAME FUND
Daniel J. Close Nuveen Michigan Quality Income Municipal Fund, Inc.
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:
NUMBER OF
PORTFOLIO MANAGER TYPE OF ACCOUNT MANAGED ACCOUNTS ASSETS*
--------------------------------------------------------------------------------
Daniel J. Close Registered Investment Company 21 $3.79 billion
Other Pooled Investment Vehicles 0 $ 0
Other Accounts 6 $50.2 million
* Assets are as of February 28, 2010. None of the assets in these accounts
are subject to an advisory fee based on performance.
Compensation. Each portfolio manager's compensation consists of three basic
elements--base salary, cash bonus and long-term incentive compensation. The
compensation strategy is to annually compare overall compensation to the market
in order to create a compensation structure that is competitive and consistent
with similar financial services companies. As discussed below, several factors
are considered in determining each portfolio manager's total compensation. In
any year these factors may include, among others, the effectiveness of the
investment strategies recommended by the portfolio manager's investment team,
the investment performance of the accounts managed by the portfolio manager, and
the overall performance of Nuveen Investments, Inc. (the parent company of NAM).
Although investment performance is a factor in determining the portfolio
manager's compensation, it is not necessarily a decisive factor. The portfolio
manager's performance is evaluated in part by comparing manager's performance
against a specified investment benchmark. This fund-specific benchmark is a
customized subset (limited to bonds in each Fund's specific state and with
certain maturity parameters) of the S&P/Investortools Municipal Bond index, an
index comprised of bonds held by managed municipal bond fund customers of
Standard & Poor's Securities Pricing, Inc. that are priced daily and whose fund
holdings aggregate at least $2 million. As of February 28, 2010, the
S&P/Investortools Municipal Bond index was comprised of 54,637 securities with
an aggregate current market value of $1,176 billion.
Base salary. Each portfolio manager is paid a base salary that is set at a level
determined by NAM in accordance with its overall compensation strategy discussed
above. NAM is not under any current contractual obligation to increase a
portfolio manager's base salary.
Cash bonus. Each portfolio manager is also eligible to receive an annual cash
bonus. The level of this bonus is based upon evaluations and determinations made
by each portfolio manager's supervisors, along with reviews submitted by his
peers. These reviews and evaluations often take into account a number of
factors, including the effectiveness of the investment strategies recommended to
the NAM's investment team, the performance of the accounts for which he serves
as portfolio manager relative to any benchmarks established for those accounts,
his effectiveness in communicating investment performance to stockholders and
their representatives, and his contribution to the NAM's investment process and
to the execution of investment strategies. The cash bonus component is also
impacted by the overall performance of Nuveen Investments, Inc. in achieving its
business objectives.
Long-term incentive compensation. In connection with the acquisition of Nuveen
Investments, Inc., by a group of investors lead by Madison Dearborn Partners in
November 2007, certain employees, including portfolio managers, received profit
interests in Nuveen's parent. These profit interests entitle the holders to
participate in the appreciation in the value of Nuveen beyond the issue date and
vest over five to seven years, or earlier in the case of a liquidity event. In
addition, in July 2009, Nuveen Investments created and funded a trust, as part
of a newly-established incentive program, which purchased shares of certain
Nuveen Mutual Funds and awarded such shares, subject to vesting, to certain
employees, including portfolio managers.
Material Conflicts of Interest. Each portfolio manager's simultaneous management
of the registrant and the other accounts noted above may present actual or
apparent conflicts of interest with respect to the allocation and aggregation of
securities orders placed on behalf of the Registrant and the other account. NAM,
however, believes that such potential conflicts are mitigated by the fact that
the NAM has adopted several policies that address potential conflicts of
interest, including best execution and trade allocation policies that are
designed to ensure (1) that portfolio management is seeking the best price for
portfolio securities under the circumstances, (2) fair and equitable allocation
of investment opportunities among accounts over time and (3) compliance with
applicable regulatory requirements. All accounts are to be treated in a
non-preferential manner, such that allocations are not based upon account
performance, fee structure or preference of the portfolio manager, although the
allocation procedures may provide allocation preferences to funds with special
characteristics (such as favoring state funds versus national funds for
allocations of in-state bonds). In addition, NAM has adopted a Code of Conduct
that sets forth policies regarding conflicts of interest.
Beneficial Ownership of Securities. As of February 28, 2010, the portfolio
manager beneficially owned the following dollar range of equity securities
issued by the Registrant and other Nuveen Funds managed by NAM's municipal
investment team.
DOLLAR RANGE OF
EQUITY SECURITIES
DOLLAR BENEFICIALLY OWNED
RANGE OF IN THE REMAINDER OF
EQUITY NUVEEN FUNDS
SECURITIES MANAGED BY NAM'S
BENEFICIALLY MUNICIPAL
NAME OF PORTFOLIO OWNED IN INVESTMENT
MANAGER FUND FUND TEAM
-------------------------------------------------------------------------------------------------------------------
Daniel J. Close Nuveen Michigan Quality Income Municipal Fund, Inc. $0 $10,001-$50,000
PORTFOLIO MANAGER BIO:
Daniel J. Close, CFA, is a Senior Vice President of Nuveen Asset Management. He
has direct responsibility for managing approximately $4 billion of municipal
securities in 22 municipal funds. He joined Nuveen Investments in 2000 as a
member of Nuveen's product management and development team. He then served as a
research analyst for Nuveen's municipal investing team, covering
corporate-backed, energy, transportation and utility credits. 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. Mr. Close also serves as a portfolio manager to the Build
America Investment Grade Bond Fund.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Period* (a) (b) (c) (d)*
TOTAL NUMBER OF AVERAGE TOTAL NUMBER OF SHARES MAXIMUM NUMBER (OR
SHARES (OR PRICE (OR UNITS) PURCHASED AS APPROXIMATE DOLLAR VALUE) OF
UNITS) PAID PER PART OF PUBLICLY SHARES (OR UNITS) THAT MAY YET
PURCHASED SHARE (OR ANNOUNCED PLANS OR BE PURCHASED UNDER THE PLANS OR
UNIT) PROGRAMS PROGRAMS
MARCH 1-31, 2009 65,400 $10.17 65,400 1,104,600
APRIL 1-30, 2009 9,200 $10.96 9,200 1,095,400
MAY 1-31, 2009 0 0 1,095,400
JUNE 1-30, 2009 600 $11.40 600 1,094,800
JULY 1-31, 2009 1,000 $11.63 1,000 1,093,800
AUGUST 1-31, 2009 0 0 1,093,800
SEPTEMBER 1-30, 2009 0 0 1,093,800
OCTOBER 1-31, 2009 28,700 $12.91 28,700 1,136,300
NOVEMBER 1-30, 2009 13,000 $12.82 13,000 1,123,300
DECEMBER 1-31, 2009 21,200 $12.56 21,200 1,102,100
JANUARY 1-31, 2010 11,800 $12.79 11,800 1,090,300
FEBRUARY 1-28, 2010 3,000 $12.76 3,000 1,087,300
TOTAL 153,900
* The registrant's repurchase program, which authorized the repurchase of
1,170,000 shares, was announced August 7, 2008. On October 3, 2009, the
program was reauthorized for a maximum repurchase amount of 1,165,000
shares. Any repurchases made by the registrant pursuant to the program were
made through open-market transactions.
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 second fiscal quarter
of 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. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable
because the code is posted on registrant's website at www.nuveen.com/CEF/Info/
Shareholder and there were no amendments during the period covered by this
report. (To view the code, click on Fund Governance and then Code of Conduct.)
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT
Attached hereto.
(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.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
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 Michigan Quality Income Municipal Fund, Inc.
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By (Signature and Title) /s/ Kevin J. McCarthy
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Kevin J. McCarthy
Vice President and Secretary
Date: May 6, 2010
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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/ Gifford R. Zimmerman
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Gifford R. Zimmerman
Chief Administrative Officer
(principal executive officer)
Date: May 6, 2010
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By (Signature and Title) /s/ Stephen D. Foy
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Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: May 6, 2010
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