-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SSICR6wFkt3QXA9aVuCU4KPweenx7Ykp8wHR9qiDzvgCsljIdBKKrrJL8LVNYenY AQ7KUv6+jbE48DqM65t9QA== 0000891804-03-002222.txt : 20031008 0000891804-03-002222.hdr.sgml : 20031008 20031008081217 ACCESSION NUMBER: 0000891804-03-002222 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030731 FILED AS OF DATE: 20031008 EFFECTIVENESS DATE: 20031008 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUVEEN MICHIGAN DIVIDEND ADVANTAGE MUNICIPAL FUND CENTRAL INDEX KEY: 0001087785 IRS NUMBER: 364460816 STATE OF INCORPORATION: MA FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-09453 FILM NUMBER: 03932487 BUSINESS ADDRESS: STREET 1: JOHN NUVEEN & CO STREET 2: 333 W WACKER DR CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129178146 MAIL ADDRESS: STREET 1: JOHN NUVEEN & CO STREET 2: 333 W WACKER DR CITY: CHICAGO STATE: IL ZIP: 60606 N-CSR 1 file001.txt NUVEEN MICHIGAN DIVIDEND ADVANTAGE MUNICIPAL FUND 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 811-09453 --------------------- Nuveen Michigan Dividend Advantage Municipal Fund ------------------------------------------------------------------------------ (Exact name of registrant as specified in charter) Nuveen Investments 333 West Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip code) Jessica R. Droeger Nuveen Investments 333 West Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------ (Name and address of agent for service) Registrant's telephone number, including area code: (312) 917-7700 ------------------- Date of fiscal year end: July 31, 2003 ------------------ Date of reporting period: July 31, 2003 ----------------- 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. Nuveen Municipal Closed-End Exchange-Traded Funds ANNUAL REPORT July 31, 2003 MICHIGAN NUM NMP NZW OHIO NUO NXI NBJ NVJ PHOTO OF: WOMAN AND GIRL TALKING. PHOTO OF: MAN AND GIRL ON COMPUTER. DEPENDABLE, TAX-FREE INCOME BECAUSE IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R) Logo: NUVEEN Investments FASTER INFORMATION RECEIVE YOUR NUVEEN FUND REPORT ELECTRONICALLY By registering for electronic delivery, you will receive an e-mail as soon as your Nuveen Fund information is available. Click on the link and you will be taken directly to the report. Your Fund report can be viewed and saved on your computer. Your report will arrive faster via e-mail than by traditional mail. Registering is easy and only takes a few minutes (see instructions at right). - -------------------------------------------------------------------------------- SOME COMMON CONCERNS: WILL MY E-MAIL ADDRESS BE DISTRIBUTED TO OTHER COMPANIES? No, your e-mail address is strictly confidential and will not be used for anything other than notification of shareholder information. WHAT IF I CHANGE MY MIND AND WANT TO RECEIVE INVESTOR MATERIALS THROUGH REGULAR MAIL DELIVERY AGAIN? If you decide you do not like receiving your reports electronically, it's a simple process to go back to regular mail delivery. - -------------------------------------------------------------------------------- IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME FROM YOUR FINANCIAL ADVISOR OR BROKERAGE ACCOUNT, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.INVESTORDELIVERY.COM 2 Refer to the address sheet that accompanied this report. Enter the personal 13-CHARACTER ENROLLMENT NUMBER imprinted near your name. 3 You'll be taken to a page with several options. Select the NEW ENROLLMENT-CREATE screen. Once there, enter your e-mail address (e.g. yourID@providerID.com), and a personal, 4-digit PIN number of your choice. (Pick a number that's easy to remember.) 4 Click Submit. Confirm the information you just entered is correct, then click Submit again. 5 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 6 Use this same process if you need to change your registration information or cancel internet viewing. IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME DIRECTLY TO YOU FROM NUVEEN, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.NUVEEN.COM 2 Select ACCESS YOUR ACCOUNT. Select the E-REPORT ENROLLMENT section. Click on Enrollment Today. 3 You'll be taken to a screen that asks for your Social Security number and e-mail address. Fill in this information, then click Enroll. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. Logo: NUVEEN Investments Photo of: Timothy R. Schwertfeger Chairman of the Board Sidebar text: "NO ONE KNOWS WHAT THE FUTURE WILL BRING, WHICH IS WHY WE THINK A WELL-BALANCED PORTFOLIO ..... IS AN IMPORTANT COMPONENT IN ACHIEVING YOUR LONG-TERM FINANCIAL GOALS." Dear SHAREHOLDER Once again, I am pleased to report that over the most recent reporting period your Fund continued to provide you with attractive tax-free monthly income and the opportunity for increased portfolio diversification. For more specific information about the performance of your Fund, please see the Portfolio Manager's Comments and Performance Overview sections of this report. With interest rates at historically low levels, many have begun to wonder whether interest rates will rise, and whether that possibility should cause them to adjust their holdings of fixed-income investments. No one knows what the future will bring, which is why we think a well-balanced portfolio that is structured and carefully monitored with the help of an investment professional is an important component in achieving your long-term financial goals. A well-diversified portfolio may actually help to reduce your overall investment risk, and we believe that municipal bond investments like your Nuveen Fund can be important building blocks in a portfolio crafted to perform well through a variety of market conditions. I'd also like to direct your attention to the inside front cover of this report, which explains the quick and easy process to begin receiving Fund reports like this via e-mail and the internet. Thousands of Nuveen Fund shareholders already have signed-up, and they are getting their Fund information faster and more conveniently than ever. I urge you to consider joining them. Since 1898, Nuveen Investments has offered financial products and solutions that incorporate careful research, diversification, and the application of conservative risk-management principles. We are grateful that you have chosen us as a partner as you pursue your financial goals. We look forward to continuing to earn your trust in the months and years ahead. Sincerely, /s/ Timothy R. Schwertfeger Timothy R. Schwertfeger Chairman of the Board September 15, 2003 1 Nuveen Michigan and Ohio Municipal Closed-End Exchange-Traded Funds (NUM, NMP, NZW, NUO, NXI, NBJ, NVJ) Portfolio Manager's COMMENTS Portfolio manager Rick Huber discusses economic and market conditions, key investment strategies and the recent performance of the Funds. With 18 years of investment experience, Rick has managed NUO, NXI, and NBJ since 2001. He added NVJ at its inception in March 2002. Rick assumed portfolio management responsibility for the three Michigan Funds in January 2003. WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE TWELVE-MONTH PERIOD ENDED JULY 31, 2003? In June 2003, the Federal Reserve cut the fed funds rate to 1.0%, its lowest level since 1958. Also in June, the GDP growth rate for the first quarter of 2003 was revised downward to 1.4%. The preliminary second-quarter growth rate announced in July was 2.4%, which continued to lag the 3% level some economists consider to be indicative of a recovery. This was just the latest evidence of the two factors that, in our opinion, continued to have the greatest influence on the performance of the U.S. economy and the municipal market over the course of this reporting period - historically low interest rate levels and the sluggish pace of economic growth. In addition, inflation remained dormant through the period, while comments by the Fed kept the topic of potential deflation in the news. In combination, the slow rate of economic recovery, low interest rates and lack of inflationary pressures created conditions that helped many municipal bonds perform well during much of this reporting period. However, in July 2003 some stronger-than-expected economic data raised the specter of a tighter monetary policy sooner rather than later. This, along with volatility in the mortgage-backed securities market, precipitated a spike in bond yields and a corresponding drop in bond prices that impacted all fixed-income markets. One barometer of the volatility experienced in the bond markets during the month of July was the yield on the benchmark 10-year U.S. Treasury, which jumped approximately 150 basis points from 45-year lows in June to its highest point in more than a year by July 31, 2003. During the first seven months of 2003, the municipal market followed up the record issuance of 2002 with continued strong supply, issuing $230 billion in new bonds. This represented an increase of 18% over the same period in 2002. Much of the increase in supply reflected issuance intended to address the fiscal problems facing many states as the result of slow growth, rising costs (especially for healthcare and pensions), and sharp declines in the collection of income and capital gains taxes. Matching the increased supply, demand for municipal bonds also remained strong from both individual and institutional investors, particularly insurance companies. HOW WERE ECONOMIC AND MARKET CONDITIONS IN MICHIGAN AND OHIO? Because of its heavy dependence on the manufacturing sector, Michigan's recession has been longer and deeper than some other states. Faced with weaker vehicle sales in recent months, the state's auto manufacturers and suppliers continued to struggle to hold onto eroding market shares. Office furniture manufacturing in western Michigan also remained stalled, reflecting the ongoing weakness in commercial construction. Job creation in the state's growing biotech sector provided one of the few bright spots in Michigan's slowly diversifying industrial and economic base. The state recently approved its $37.9 billion fiscal 2004 budget, closing a gap of nearly $2 billion through spending cuts, tax increases and the use of federal receipts. Overall, we think Michigan's debt position remained well managed, with a relatively low overall debt burden and fully-funded pension liabilities. While the state's credit rating of Aaa/AAA with Moody's and Standard & Poor's, respectively, remained intact over this reporting period, both agencies are keeping a close eye on the state. As of July 31, 2003, Moody's and Standard & Poor's maintained negative outlooks on the state. Like neighboring Michigan, Ohio's economy also is heavily reliant on manufacturing, and several of its major industries--autos, machinery and steel--all suffered during the national economic slowdown. 2 While the state's recovery continued to be delayed by its dependence on manufacturing, Ohio's large wholesale and warehousing industry showed some improvement as businesses began to restock inventories. The state's industrial base continued to diversify, especially in the major metropolitan areas, and the below-average cost of doing business in the state as well as the presence of numerous corporate headquarters helped support a modest level of economic recovery. Despite the depletion of its reserve funds, Ohio ended fiscal 2003 with a small surplus resulting from federal receipts and tax increases enacted earlier in 2003. While we think the state's debt levels are moderate relative to its substantial economic base, pension liabilities were still not fully funded as of July 31, 2003. In the first seven months of 2003, Ohio issued $5.6 billion in new municipal paper, an increase of 51% over the same period in 2002. The state's $7.5 billion of general obligation debt continued to be rated Aa1/AA+, by Moody's and Standard & Poor's, respectively. In July 2003, S&P revised its outlook to stable from negative, while Moody's maintained a negative outlook. HOW DID THE FUNDS PERFORM OVER THE TWELVE-MONTHS ENDED JULY 31, 2003? Individual results for these Funds, as well as for selected benchmarks, are presented in the accompanying table. TOTAL RETURN LEHMAN LIPPER MARKET YIELD ON NAV TOTAL RETURN1 AVERAGE2 - --------------------------------------------------------------------- 1 YEAR 1 YEAR 1 YEAR TAXABLE- ENDED ENDED ENDED 7/31/03 EQUIVALENT3 7/31/03 7/31/03 7/31/03 - --------------------------------------------------------------------- NUM 6.06% 8.78% 4.35% 3.60% 4.45% - --------------------------------------------------------------------- NMP 6.22% 9.01% 3.71% 3.60% 4.45% - --------------------------------------------------------------------- NZW 5.92% 8.58% 5.01% 3.60% 4.45% - --------------------------------------------------------------------- NUO 5.88% 8.78% 4.84% 3.60% 4.35% - --------------------------------------------------------------------- NXI 6.61% 9.87% 5.09% 3.60% 4.35% - --------------------------------------------------------------------- NBJ 6.31% 9.42% 4.74% 3.60% 4.35% - --------------------------------------------------------------------- NVJ 6.08% 9.07% 3.81% 3.60% 4.35% - --------------------------------------------------------------------- Past performance is not predictive of future results. For additional information, see the individual Performance Overview for your Fund in this report. For the twelve months ended July 31, 2003, all of the Funds in this report outperformed the national, unleveraged Lehman Brothers Municipal Bond Index. One of the factors that benefited the performance of these Funds in comparison with the Lehman index was their use of leverage, a strategy that can provide the opportunity for additional income for common shareholders, especially during periods of low short-term interest rates. Income is an important component of total return for any bond investment, and additional income can lead to enhanced total returns. In general over this period, most of the Funds were also helped by their relatively longer durations.4 During periods of declining interest rates, such as that we experienced over most of the twelve-month period, investments with longer durations generally would be expected to perform better than those with shorter durations, all other factors being equal. As of July 31, 2003, the durations of these Funds ranged from 8.77 for NMP to 15.05 for NZW, compared with 8.17 for the Lehman index. In addition to leverage and duration, factors such as call exposure, portfolio trading activity and the price movement of specific sectors and holdings also had an impact on the Funds' performances. For example, NMP had a large position in bonds with short call provisions, which contributed to its modest underperformance relative to the other funds over this reporting period. NMP also held $1 million (par value) in bonds issued by the Puerto Rico Ports Authority and backed by American Airlines. Over the past year, the market value of most airline-backed bonds fell, due in part to a decline in passenger volume and in part to the well-documented financial struggles of many carriers. The depreciation of these bonds over the reporting period had a negative impact on NMP's total return. In addition, both NMP and NUM held small positions in bonds issued for Detroit Medical Center, the largest healthcare provider in the Detroit metropolitan area. These securities underperformed the market during the last months of the reporting period, reflecting operating 1 The total annual returns on common share net asset value (NAV) for these Nuveen Funds are compared with the total annual return of the Lehman Brothers Municipal Bond Index, an unleveraged, unmanaged national index comprising a broad range of investment-grade municipal bonds. Results for the Lehman index do not reflect any expenses. 2 The total returns of the Nuveen Michigan Funds are compared with the average annualized return of the 6 funds in the Lipper Michigan Municipal Debt Funds category, while the total returns of the Nuveen Ohio Funds are compared with the average annualized return of the 36 funds in the Lipper Other States Municipal Debt Funds category. Fund and Lipper returns assume reinvestment of dividends. It should be noted that the performance of the Lipper Other States category represents the overall average of annual returns for funds from 10 different states with a wide variety of economic and municipal market conditions and investment guidelines, making direct comparisons less applicable. 3 The taxable-equivalent yield represents the yield that must be earned on a taxable investment in order to equal the yield of the Nuveen Fund on an after-tax basis. The taxable-equivalent yield is based on the Fund's market yield on the indicated date and a federal income tax rate of 28% plus the applicable state income tax rate. The combined federal and state tax rates used in this report are as follows: Michigan 31% and Ohio 33%. 4 Duration is a measure of a Fund's NAV volatility in reaction to interest rate movements. Fund duration, also known as leverage-adjusted duration, takes into account the leveraging process for a Fund and therefore is generally longer than the duration of the actual portfolio of individual bonds that make up the Fund. References to duration in this commentary are intended to indicate Fund duration unless otherwise noted. 3 losses at two of the Center's nine hospitals. New management, as well as a public task force, is currently examining ways to deal with future funding, including public subsidies. Among the Ohio Funds, the performance of NVJ, which was assembled in the lower interest rate environment of March 2002, was affected by the relatively higher number of lower-yielding securities in its portfolio. As mentioned earlier, income plays an important part in a bond fund's total return. In addition, this Fund held a higher percentage of tobacco-backed bonds relative to the other three Ohio Funds, which cost NVJ approximately 30 basis points in performance over this reporting period. HOW DID THE MARKET ENVIRONMENT AFFECT THE FUNDS' DIVIDENDS AND SHARE PRICES? As noted earlier, with short-term interest rates at historically low levels, the dividend-paying capabilities of these Funds benefited from their use of leverage. The amount of this benefit is tied in part to the short-term rates the Funds pay their MuniPreferred(R) shareholders. Low short-term rates can enable the Funds to reduce the amount of income paid to MuniPreferred shareholders, which can potentially leave more earnings to support common share dividends. During the twelve months ended July 31, 2003, the continued low level of short-term interest rates enabled us to implement three dividend increases in NMP, NZW, NUO, NXI and NBJ and two in NUM. As of July 2003, NVJ--the newest Fund in this report--had paid shareholders stable, attractive dividends for 15 consecutive months. Although the share prices and net asset values of these Funds performed well during much of this reporting period, the increased volatility that led to an overall weakening of bond prices during July 2003 resulted in share prices and NAVs that were generally lower on July 31, 2003, than they were one year earlier. NZW was the only Fund to end the period with a higher share price. As of July 31, 2003, NUM, NZW and NUO were trading at premiums to their common share NAVs, while NXI, NBJ and NVJ had moved to trading at slight discounts, and NMP continued to trade at a small discount (see charts on individual Performance Overview pages). WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THE TWELVE-MONTHS ENDED JULY 31, 2003? Over this reporting period, we continued to place strong emphasis on diversifying the portfolios, improving call protection and enhancing each Fund's dividend-paying capabilities. Strategically, our main focus centered on systematically controlling the Funds' durations, which we believed would enhance our ability to mitigate the Funds' interest rate risk and produce more consistent returns over time. Interest rate risk is the risk that the value of a Fund's portfolio will decline when market interest rates rise (since bond prices move in the opposite direction of interest rates). The longer the duration of a Fund's portfolio, the greater its interest rate risk. In line with our duration strategy, we concentrated on finding value in the intermediate part of the yield curve (i.e., bonds that mature in 15 to 20 years), particularly for the newer Funds with generally longer durations. In many cases, bonds in this part of the curve offered yields similar to those of longer-term bonds but, in our opinion, had less inherent interest rate risk. In some of the older Funds (NUM, NMP and NUO), the need to replace shorter duration bonds that were called from the portfolios with current bonds having longer durations served to extend the Funds' durations slightly over this period. 4 In general, the relatively heavy issuances in the Michigan and Ohio municipal markets over the period increased our trading opportunities. In both markets, we continued to look for bonds that we believed had the potential to perform relatively well regardless of the future direction of interest rates. We also watched for opportunities to take losses on selected securities in order to offset the generation of capital gains. Over the twelve-month period, the Michigan and Ohio Funds generally had significant holdings of healthcare and water and sewer bonds, which were among the top performing Lehman revenue sectors for this reporting period. In Ohio, specifically, we participated in a number of larger issues, including those for City of Cincinnati Water System. As of July 31, 2003, each of the Michigan and Ohio Funds, except for NZW, also had small positions in bonds backed by the 1998 master tobacco settlement agreement. In recent months, the prices of these bonds weakened as the result of lawsuits involving the major tobacco companies as well as the increased issuance of such bonds by states planning to use the proceeds to help close budget gaps. Although the sector as a whole produced negative returns over the twelve months ended July 31, 2003, tobacco-backed bonds showed some recovery toward the end of the period. As of the end of this reporting period, our strategy was to maintain our tobacco holdings while we continued to regularly evaluate the situation. Given the current geopolitical and economic climate, we believed that maintaining strong credit quality remained a vital requirement. As of July 31, 2003, the Michigan and Ohio Funds all offered excellent credit quality, with allocations of bonds rated AAA/U.S. guaranteed and AA ranging from 64% to 86%. In general, our weightings in insured and AAA bonds benefited the performance of these Funds during the past year. WHAT IS YOUR OUTLOOK FOR THESE FUNDS? We continue to believe that the U.S. economy is slowly headed for a recovery. We also think that inflation and interest rates will remain relatively low over the near term. However, an eventual rise in interest rates remains a distinct risk, and we plan to keep a careful watch on the Funds' durations and holdings in order to be as well positioned as possible if and when this happens. All of these Funds, with the exception of NMP, offer good levels of call protection, with potential call exposure ranging from zero in NZW and NVJ to 14% in NUO through the end of 2004. During this recently completed reporting period, we worked to mitigate the call risk of the three older Funds, especially NMP. As of July 31, 2003, NMP's potential call exposure through 2003 and 2004 was 18%, down from 26% one year earlier. The number of actual calls in all of these Funds will depend largely on market interest rates in coming months. Looking ahead, we will continue to manage the Funds' durations and seek to enhance their income-generating capabilities. We also plan to continue closely monitoring the budgetary situations in both states. We believe that these Nuveen Funds remain attractive sources of tax-free income, and continue to offer the potential for considerable portfolio diversification. 5 Nuveen Michigan Quality Income Municipal Fund, Inc. Performance OVERVIEW As of July 31, 2003 NUM Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 81% AA 3% A 10% BBB 4% NR 1% BB or lower 1% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $15.45 - -------------------------------------------------- Common Share Net Asset Value $15.14 - -------------------------------------------------- Market Yield 6.06% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.42% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 8.78% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $176,186 - -------------------------------------------------- Average Effective Maturity (Years) 17.78 - -------------------------------------------------- Leverage-Adjusted Duration 11.85 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 10/17/91) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 2.40% 4.35% - -------------------------------------------------- 5-Year 4.18% 5.54% - -------------------------------------------------- 10-Year 6.24% 6.20% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 26% - -------------------------------------------------- U.S. Guaranteed 16% - -------------------------------------------------- Healthcare 13% - -------------------------------------------------- Tax Obligation/Limited 11% - -------------------------------------------------- Water and Sewer 9% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Aug 0.0755 Sep 0.0765 Oct 0.0765 Nov 0.0765 Dec 0.0765 Jan 0.0765 Feb 0.0765 Mar 0.078 Apr 0.078 May 0.078 Jun 0.078 Jul 0.078 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 16.1 16 15.86 15.62 15.4 15.74 15.66 15.73 15.78 15.8 15.67 15 14.75 15.19 15.15 14.9 14.9 14.98 15.1 14.7 14.75 15.15 15.5 15.25 15.36 15.44 15.45 15.48 15.57 15.53 15.74 15.9 16.06 15.67 16.05 16.1 15.95 16.2 16.49 16.87 16.85 16.6 16.81 16.84 16.55 16.8 16.8 16.39 15.65 15.53 7/31/02 15.45 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 31%. 2 The Fund also paid shareholders a capital gains distribution in December 2002 of $0.1030 per share. 6 Nuveen Michigan Premium Income Municipal Fund, Inc. Performance OVERVIEW As of July 31, 2003 NMP Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 77% AA 9% A 10% BBB 1% BB or lower 3% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $14.85 - -------------------------------------------------- Common Share Net Asset Value $15.24 - -------------------------------------------------- Market Yield 6.22% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.64% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 9.01% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $117,418 - -------------------------------------------------- Average Effective Maturity (Years) 15.89 - -------------------------------------------------- Leverage-Adjusted Duration 8.77 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 12/17/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 2.64% 3.71% - -------------------------------------------------- 5-Year 5.85% 5.69% - -------------------------------------------------- 10-Year 6.04% 6.36% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- U.S. Guaranteed 21% - -------------------------------------------------- Tax Obligation/Limited 16% - -------------------------------------------------- Utilities 16% - -------------------------------------------------- Tax Obligation/General 16% - -------------------------------------------------- Healthcare 14% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE Aug 0.0735 Sep 0.0745 Oct 0.0745 Nov 0.0745 Dec 0.0755 Jan 0.0755 Feb 0.0755 Mar 0.077 Apr 0.077 May 0.077 Jun 0.077 Jul 0.077 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 15.41 15.34 15.25 15.1 15.15 15.45 15.32 15.25 15.4 15.54 15.25 14.69 14.69 14.86 14.72 14.53 14.49 14.59 14.7 14.58 14.45 14.78 15.06 14.78 14.72 14.65 14.8 14.72 14.67 14.76 14.83 15.2 15.34 15.1 15.07 15.28 15.45 15.61 15.81 15.85 16.24 16.4 16.6 16.73 16.1 16.31 16.32 16.05 15.35 15.28 7/31/03 14.85 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 31%. 7 Nuveen Michigan Dividend Advantage Municipal Fund Performance OVERVIEW As of July 31, 2003 NZW Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 80% AA 5% A 10% BBB 3% BB or lower 2% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $15.10 - -------------------------------------------------- Common Share Net Asset Value $14.30 - -------------------------------------------------- Market Yield 5.92% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.22% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 8.58% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $29,443 - -------------------------------------------------- Average Effective Maturity (Years) 22.33 - -------------------------------------------------- Leverage-Adjusted Duration 15.05 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 9/25/01) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 9.19% 5.01% - -------------------------------------------------- Since Inception 6.04% 5.58% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 35% - -------------------------------------------------- Tax Obligation/Limited 20% - -------------------------------------------------- Healthcare 12% - -------------------------------------------------- Utilities 8% - -------------------------------------------------- Water and Sewer 6% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE Aug 0.0695 Sep 0.0695 Oct 0.0695 Nov 0.0695 Dec 0.0705 Jan 0.0705 Feb 0.0705 Mar 0.0735 Apr 0.0735 May 0.0735 Jun 0.0745 Jul 0.0745 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 14.6 14.33 14.28 14.21 14.45 14.6 14.65 14.71 14.71 14.85 14.75 14.85 14.52 15 14.87 14.63 14.35 14.49 14.23 13.9 13.83 13.88 14.15 14.4 14.16 14.38 14.7 14.94 14.57 14.8 14.8 15.06 14.92 14.91 14.77 14.69 14.85 14.83 14.95 15.13 15.18 15.36 15.81 15.99 15.75 15.65 15.93 15.75 15.52 15.3 7/31/03 15.1 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 31%. 8 Nuveen Ohio Quality Income Municipal Fund, Inc. Performance OVERVIEW As of July 31, 2003 NUO Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 73% AA 12% A 9% BBB 4% NR 1% BB or lower 1% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $17.04 - -------------------------------------------------- Common Share Net Asset Value $16.17 - -------------------------------------------------- Market Yield 5.88% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.17% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 8.78% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $155,412 - -------------------------------------------------- Average Effective Maturity (Years) 16.50 - -------------------------------------------------- Leverage-Adjusted Duration 9.06 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 10/17/91) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year -3.15% 4.84% - -------------------------------------------------- 5-Year 4.56% 5.47% - -------------------------------------------------- 10-Year 6.87% 6.55% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 22% - -------------------------------------------------- U.S. Guaranteed 20% - -------------------------------------------------- Healthcare 14% - -------------------------------------------------- Water and Sewer 10% - -------------------------------------------------- Housing/Multifamily 8% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE Aug 0.0795 Sep 0.081 Oct 0.081 Nov 0.081 Dec 0.082 Jan 0.082 Feb 0.082 Mar 0.0835 Apr 0.0835 May 0.0835 Jun 0.0835 Jul 0.0835 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 18.65 18.32 18.1 17.88 17.74 17.95 17.9 17.8 17.9 17.9 17.95 17.01 16.92 16.6 16.5 16.44 16.49 16.75 16.58 16.33 16.63 16.56 16.92 16.8 16.81 16.95 16.9 16.67 16.79 16.95 17.1 17.1 17.3 17.11 17.43 17.45 17.57 17.63 17.54 17.65 18.2 18.6 19.02 18.41 18.16 18.01 18.25 17.85 17.74 17.38 7/31/03 17.04 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 33%. 9 Nuveen Ohio Dividend Advantage Municipal Fund Performance OVERVIEW As of July 31, 2003 NXI Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 44% AA 20% A 17% BBB 16% NR 1% BB or lower 2% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $14.26 - -------------------------------------------------- Common Share Net Asset Value $14.66 - -------------------------------------------------- Market Yield 6.61% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 9.18% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 9.87% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $61,924 - -------------------------------------------------- Average Effective Maturity (Years) 18.72 - -------------------------------------------------- Leverage-Adjusted Duration 9.72 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 3/27/01) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year -0.04% 5.09% - -------------------------------------------------- Since Inception 3.49% 7.00% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 22% - -------------------------------------------------- Education and Civic Organizations 17% - -------------------------------------------------- Healthcare 15% - -------------------------------------------------- Utilities 12% - -------------------------------------------------- Tax Obligation/Limited 9% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Aug 0.073 Sep 0.074 Oct 0.074 Nov 0.074 Dec 0.076 Jan 0.076 Feb 0.076 Mar 0.0785 Apr 0.0785 May 0.0785 Jun 0.0785 Jul 0.0785 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 15.15 15.24 15.16 15.24 15.3 15.65 15.83 15.96 15.8 16.1 15.92 15.6 15 14.84 14.87 14.85 14.95 14.91 15.25 15.01 15.25 15.55 15.26 15.33 15.3 15.25 15.5 15.65 15.35 15.48 15.45 15.35 15.22 15.35 15.41 15.57 15.49 15.49 15.79 15.93 15.87 16 15.78 15.78 15.53 15.35 15.63 15.42 15.03 14.9 7/31/03 14.26 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 33%. 2 The Fund also paid shareholders a capital gains distribution in December 2002 of $0.0103 per share. 10 Nuveen Ohio Dividend Advantage Municipal Fund 2 Performance OVERVIEW As of July 31, 2003 NBJ Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 61% AA 10% A 15% BBB 11% NR 3% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $14.26 - -------------------------------------------------- Common Share Net Asset Value $14.31 - -------------------------------------------------- Market Yield 6.31% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.76% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 9.42% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $44,578 - -------------------------------------------------- Average Effective Maturity (Years) 20.23 - -------------------------------------------------- Leverage-Adjusted Duration 12.26 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 9/25/01) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 3.17% 4.74% - -------------------------------------------------- Since Inception 2.76% 5.62% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 34% - -------------------------------------------------- Healthcare 16% - -------------------------------------------------- Tax Obligation/Limited 11% - -------------------------------------------------- Utilities 9% - -------------------------------------------------- Consumer Staples 7% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE Aug 0.069 Sep 0.07 Oct 0.07 Nov 0.07 Dec 0.072 Jan 0.072 Feb 0.072 Mar 0.075 Apr 0.075 May 0.075 Jun 0.075 Jul 0.075 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 14.7 14.88 14.76 14.95 15 15.15 15.15 15.2 15.39 15.4 15.5 14.7 13.7 13.98 14.26 14.32 14.2 14.09 14.7 14.57 14.5 14.61 15 14.76 14.71 14.9 14.4 14.85 14.95 14.86 14.95 15.07 15 14.46 15.05 14.97 15.38 15.08 15.05 15.14 15.53 16.25 16 15.7 15.22 15.41 15.76 15.11 14.8 14.55 7/31/03 14.26 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 33%. 11 Nuveen Ohio Dividend Advantage Municipal Fund 3 Performance OVERVIEW As of July 31, 2003 NVJ Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 55% AA 23% A 17% BBB 5% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $14.40 - -------------------------------------------------- Common Share Net Asset Value $14.48 - -------------------------------------------------- Market Yield 6.08% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.44% - -------------------------------------------------- Taxable-Equivalent Yield (Federal and State Income Tax Rate)1 9.07% - -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $31,245 - -------------------------------------------------- Average Effective Maturity (Years) 18.55 - -------------------------------------------------- Leverage-Adjusted Duration 11.48 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 3/25/02) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 0.09% 3.81% - -------------------------------------------------- Since Inception 2.64% 6.66% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 28% - -------------------------------------------------- Healthcare 16% - -------------------------------------------------- Tax Obligation/Limited 14% - -------------------------------------------------- Education and Civic Organizations 12% - -------------------------------------------------- Water and Sewer 9% - -------------------------------------------------- Bar Chart: 2002-2003 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Aug 0.073 Sep 0.073 Oct 0.073 Nov 0.073 Dec 0.073 Jan 0.073 Feb 0.073 Mar 0.073 Apr 0.073 May 0.073 Jun 0.073 Jul 0.073 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 8/1/02 15.4 15.4 15.27 15.1 15.5 15.5 15.74 15.4 15.22 16 15.56 15.5 15 14.98 14.95 14.85 14.25 14.35 14.95 14.66 14.45 14.83 15.5 14.9 15.03 15.09 15.1 15.14 14.99 15.06 15.03 14.91 15.22 15.01 15.08 15.21 15.03 15.05 15.2 15.41 15.31 15.8 15.84 16.06 16.02 16.01 15.85 15.77 14.95 14.56 7/31/03 14.4 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 28%. The rate shown for federal and state highlights the added value of owning shares that are also exempt from state income taxes. It is based on a combined federal and state income tax rate of 33%. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2002 of $0.0563 per share. 12 Report of INDEPENDENT AUDITORS THE BOARDS 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 statements 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 as of July 31, 2003, and the related statements of operations, changes in net assets and the financial highlights for 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 auditing standards generally accepted in the 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights. Our procedures included confirmation of investments owned as of July 31, 2003, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. 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 July 31, 2003, and the results of their operations, changes in their net assets and the financial highlights for the periods indicated therein in conformity with accounting principles generally accepted in the United States. /s/ Ernst & Young LLP Chicago, Illinois September 12, 2003 13 Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.6% Puerto Rico, The Children's Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds, Series 2002: $ 3,250 5.375%, 5/15/33 5/12 at 100.00 A- $ 2,818,498 2,000 5.500%, 5/15/39 5/12 at 100.00 A- 1,705,080 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 7.2% 1,720 Ferris State College, Michigan, General Revenue Bonds, 4/08 at 100.00 AAA 1,717,712 Series 1998, 5.000%, 10/01/23 - AMBAC Insured 1,685 Michigan Higher Education Facilities Authority, Limited 9/11 at 100.00 Aaa 1,803,472 Obligation Revenue Refunding Bonds, Kettering University, Series 2001, 5.500%, 9/01/17 - AMBAC Insured 1,500 Michigan Higher Education Student Loan Authority, Revenue No Opt. Call AAA 1,593,720 Bonds, Series 2000 XII-T, 5.300%, 9/01/10 (Alternative Minimum Tax) - AMBAC Insured 1,000 Michigan Higher Education Student Loan Authority, Revenue 9/12 at 100.00 AAA 1,004,550 Bonds, Series 2002 XVII-G, 5.200%, 9/01/20 (Alternative Minimum Tax) - AMBAC Insured 1,000 Oakland University, Michigan, General Revenue Bonds, 5/05 at 102.00 AAA 1,077,440 Series 1995, 5.750%, 5/15/15 - MBIA Insured Wayne State University, Michigan, General Revenue Bonds, Series 1999: 3,430 5.250%, 11/15/19 - FGIC Insured 11/09 at 101.00 AAA 3,536,502 1,000 5.125%, 11/15/29 - FGIC Insured 11/09 at 101.00 AAA 998,490 1,000 Western Michigan University, General Revenue Refunding 11/13 at 100.00 AAA 1,011,560 Bonds, Series 2003, 5.000%, 11/15/20 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 19.1% 2,900 Dearborn Hospital Finance Authority, Michigan, Economic 11/05 at 102.00 AAA 3,006,575 Development Corp., Hospital Revenue Bonds, Oakwood Obligated Group, Series 1995A, 5.875%, 11/15/25 - FGIC Insured 1,235 Hancock Hospital Finance Authority, Michigan, FHA-Insured 8/08 at 100.00 AAA 1,237,137 Mortgage Hospital Revenue Bonds, Portage Health System, Inc., Series 1998, 5.450%, 8/01/47 - MBIA Insured 3,500 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/11 at 101.00 AA 3,470,320 Spectrum Health, Series 2001A, 5.250%, 1/15/21 2,702 Michigan State Hospital Finance Authority, Detroit Medical No Opt. Call Baa2 2,708,283 Center Collateralized Loan, Series 2001, 7.360%, 4/01/07 1,500 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 1,533,360 Refunding Bonds, Henry Ford Health System, Series 2003A, 5.625%, 3/01/17 1,000 Michigan State Hospital Finance Authority, Revenue Refunding 11/09 at 101.00 A 1,038,400 Bonds, OSF Healthcare System, Series 1999, 6.125%, 11/15/19 1,700 Michigan State Hospital Finance Authority, Revenue Refunding 8/09 at 101.00 AAA 1,769,003 Bonds, Mercy Health Services Obligated Group, Series 1999X, 5.750%, 8/15/19 - MBIA Insured Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds, Mercy Mount Clemens Corporation Obligated Group, Series 1999A: 3,385 5.750%, 5/15/17 - MBIA Insured 5/09 at 101.00 AAA 3,570,363 500 5.750%, 5/15/29 - MBIA Insured 5/09 at 101.00 AAA 510,930 2,700 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 Ba3 1,634,310 Bonds, Detroit Medical Center Obligated Group, Series 1998A, 5.250%, 8/15/28 1,000 Michigan State Hospital Finance Authority, Revenue Refunding 11/09 at 101.00 BBB 951,420 Bonds, Memorial Healthcare Center Obligated Group, Series 1999, 5.875%, 11/15/21 5,000 Michigan State Hospital Finance Authority, Hospital Revenue 11/09 at 101.00 A1 5,132,350 Bonds, Henry Ford Health System, Series 1999A, 6.000%, 11/15/24 14 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE (continued) $ 5,500 Hospital Finance Authority, Royal Oak, Michigan, Hospital 11/11 at 100.00 AAA $ 5,499,560 Revenue Bonds, William Beaumont Hospital, Series 2001M, 5.250%, 11/15/31 - MBIA Insured 2,195 University of Michigan, Medical Service Plan Revenue No Opt. Call AA 1,641,728 Bonds, Series 1991, 0.000%, 12/01/10 - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 9.8% 2,675 Michigan Housing Development Authority, Limited Obligation 12/20 at 101.00 AAA 2,721,732 Multifamily Housing Revenue Bonds, Parkview Place Apartments, Series 2002A, 5.550%, 12/01/34 (Alternative Minimum Tax) 1,800 Michigan Housing Development Authority, FNMA Enhanced 9/15 at 100.00 Aaa 1,762,848 Limited Obligation Multifamily Revenue Bonds, Renaissance Apartments, Series 2002, 5.500%, 8/01/35 (Alternative Minimum Tax) 5,250 Michigan Housing Development Authority, Limited Obligation 10/03 at 102.00 AAA 5,368,125 Revenue Bonds, Parkway Meadows Project, Series 1991, 6.850%, 10/15/18 - FSA Insured 3,790 Michigan Housing Development Authority, Rental Housing 6/05 at 102.00 AAA 3,931,329 Revenue Bonds, Series 1995B, 6.150%, 10/01/15 - MBIA Insured 3,595 Michigan Housing Development Authority, Rental Housing 4/09 at 101.00 AAA 3,515,874 Revenue Bonds, Series 1999A, 5.300%, 10/01/37 (Alternative Minimum Tax) - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 0.6% 1,000 Michigan Housing Development Authority, Single Family 1/11 at 100.00 AAA 1,020,090 Mortgage Revenue Bonds, Series 2001, 5.300%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 0.6% 1,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds, 12/03 at 102.00 BBB 1,023,910 WMX Technologies, Inc. Project, Series 1993, 6.000%, 12/01/13 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 2.3% 3,300 Michigan State Hospital Finance Authority, Revenue Bonds, 1/07 at 102.00 N/R 2,886,444 Presbyterian Villages of Michigan Obligated Group, Series 1997, 6.375%, 1/01/25 1,300 Michigan Strategic Fund, Limited Obligation Revenue Refunding 7/08 at 101.00 A- 1,217,853 Bonds, Porter Hills Presbyterian Village, Series 1998, 5.375%, 7/01/28 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 38.7% Allegan County Public School District, Michigan, General Obligation Bonds, Series 2000: 1,850 5.600%, 5/01/20 - FSA Insured 5/10 at 100.00 AAA 1,959,687 1,435 5.750%, 5/01/30 - FSA Insured 5/10 at 100.00 AAA 1,515,561 4,200 Anchor Bay School District, Macomb and St. Clair Counties, 5/11 at 100.00 AAA 4,101,594 Michigan, General Obligation Refunding Bonds - Unlimited Tax, Series 2001, 5.000%, 5/01/29 1,000 Anchor Bay School District, Macomb and St. Clair Counties, 5/12 at 100.00 AAA 986,220 Michigan, General Obligation Refunding Bonds, Series 2002, 5.000%, 5/01/25 1,000 Belding School District, Ionia, Kent and Montcalm Counties, 5/08 at 100.00 AAA 983,240 Michigan, General Obligation Refunding Bonds, Series 1998, 5.000%, 5/01/26 - AMBAC Insured 1,200 Birmingham, Michigan, General Obligation Bonds, 10/12 at 100.50 AAA 1,216,848 Series 2002, 5.000%, 10/01/20 1,320 Bridgeport Spaulding Community School District, Saginaw 5/12 at 100.00 AAA 1,418,960 County, Michigan, General Obligation Bonds, Series 2002, 5.500%, 5/01/16 1,800 Byron Center Public Schools, Kent County, Michigan, General 11/11 at 100.00 AAA 1,912,950 Obligation Bonds, Series 2001, 5.500%, 5/01/18 - FGIC Insured 1,000 Charlotte Public School District, Easton County, Michigan, 5/09 at 100.00 AAA 1,007,810 Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 5.250%, 5/01/25 - FGIC Insured 2,000 Clarkston Community Schools, Michigan, General Obligation 5/07 at 100.00 AAA 2,016,060 Bonds, School Bond Loan Fund - QSBLF, Series 1997, 5.250%, 5/01/23 - MBIA Insured 2,000 Detroit School District, Wayne County, Michigan, General No Opt. Call AAA 2,295,340 Obligation Bonds, Series 2002A, 6.000%, 5/01/19 - FGIC Insured 1,000 East China School District, St. Clair County, Michigan, General 11/11 at 100.00 AAA 1,048,330 Obligation Bonds, Series 2001, 5.500%, 5/01/20 15 Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 1,085 Freeland Community School District, Saginaw, Midland and 5/10 at 100.00 AAA $ 1,115,489 Bay Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 2000, 5.250%, 5/01/19 3,300 Grand Ledge Public Schools, Eaton, Clinton and Ionia 5/05 at 102.00 AAA 3,334,815 Counties, Michigan, General Obligation Refunding Bonds, Series 1995, 5.375%, 5/01/24 - MBIA Insured 3,000 Grand Rapids and Kent County Joint Building Authority, No Opt. Call AAA 817,560 Michigan, Limited Tax General Obligation Bonds, Devos Place Project, Series 2001, 0.000%, 12/01/26 1,710 Holland Building Authority, Michigan, General Obligation 10/11 at 100.00 AAA 1,734,504 Bonds, Series 2002, 5.000%, 10/01/19 - AMBAC Insured 1,500 Huron Valley School District, Oakland and Livingston 11/11 at 100.00 AAA 1,603,695 Counties, Michigan, General Obligation Bonds, Series 2001, 5.500%, 5/01/17 2,000 Lake Fenton Community Schools, Genesee County, Michigan, 5/12 at 100.00 AAA 1,980,740 General Obligation Bonds, Series 2002, 5.000%, 5/01/24 725 Lake Orion Community School District, Oakland County, 5/05 at 101.00 AAA 754,261 Michigan, Unlimited Tax General Obligation Refunding Bonds, Series 1995, 5.500%, 5/01/20 - AMBAC Insured 1,000 Mancelona Public School District, General Obligation Bonds, 5/06 at 100.00 AAA 1,037,920 Antrim and Kalkaska Counties, Michigan, Series 1997, 5.200%, 5/01/17 - FGIC Insured 4,300 Montcalm County Building Authority, Michigan, Correctional 5/10 at 100.00 AAA 4,336,077 Facility Improvement General Obligation Bonds, Series 2000, 5.250%, 5/01/25 - AMBAC Insured 2,500 Montrose School District, Michigan, School Building and No Opt. Call AAA 2,823,000 Site Bonds, Series 1997, 6.000%, 5/01/22 - MBIA Insured 1,255 Morenci Area Schools, Lenawee County, Michigan, General 5/12 at 100.00 AAA 1,300,770 Obligation Bonds, Series 2002, 5.250%, 5/01/19 - MBIA Insured 1,000 Muskegon Heights Public Schools, Muskegon County, 5/09 at 100.00 AAA 976,570 Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 5.000%, 5/01/29 - MBIA Insured 1,625 Northville Public Schools, Wayne County, Michigan, General 11/11 at 100.00 AAA 1,705,746 Obligation Bonds, Series 2001, 5.375%, 5/01/18 Novi Community School District, Oakland County, Michigan, General Obligation Refunding Bonds, Series 2002: 1,670 5.000%, 5/01/19 5/12 at 100.00 AAA 1,695,301 830 5.000%, 5/01/20 5/12 at 100.00 AAA 838,433 1,000 Oakland County Building Authority, Michigan, General 9/11 at 100.00 AAA 1,015,890 Obligation Bonds, Series 2002, 5.125%, 9/01/22 1,225 Paw Paw Public School District, Van Buren, Michigan, No Opt. Call AAA 1,245,874 General Obligation Refunding Bonds, Series 1998, 5.000%, 5/01/21 - FGIC Insured 4,000 Pinckney Community Schools, Livingston and Washtenaw 5/07 at 100.00 AAA 4,077,120 Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1997, 5.500%, 5/01/27 - FGIC Insured 4,200 Puerto Rico Public Improvement, General Obligation No Opt. Call AAA 4,601,814 Refunding Bonds, Series 2002A, 5.500%, 7/01/20 - MBIA Insured 685 Reeths-Puffer Schools, Muskegon County, Michigan, School 5/05 at 101.00 AAA 730,635 Building and Site Refunding Bonds, Series 1995, 5.750%, 5/01/15 - FGIC Insured 1,000 Rochester Community School District, Oakland and Macomb 5/10 at 100.00 AAA 1,082,210 Counties, Michigan, General Obligation Bonds, Series 2000I, 5.750%, 5/01/19 - FGIC Insured 2,500 Taylor Building Authority, Wayne, Michigan, Limited Tax 3/10 at 100.00 AAA 2,575,875 General Obligation Bonds, Series 2000, 5.125%, 3/01/17 - AMBAC Insured 1,050 Warren Consolidated School District, Macomb and Oakland 11/11 at 100.00 AAA 1,093,922 Counties, Michigan, General Obligation Bonds, Series 2001, 5.375%, 5/01/19 - FSA Insured 1,980 Washtenaw County Building Authority, Michigan, Limited 9/07 at 100.00 AAA 2,097,869 Tax General Obligation Bonds, Series 1999, 5.400%, 9/01/17 - FGIC Insured 1,125 Whitehall District Schools, Muskegon County, Michigan, 11/11 at 100.00 AAA 1,202,771 General Obligation Bonds, Series 2001, 5.500%, 5/01/17 16 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 1,725 Williamston Community School District, Michigan, Unlimited No Opt. Call AAA $ 1,837,246 Tax General Obligation QSBLF Bonds, Series 1996, 5.500%, 5/01/25 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 15.9% 1,800 Dearborn Heights Tax Increment Financing Authority, 10/10 at 100.00 AAA 1,769,562 Wayne County, Michigan, Limited Tax General Obligation Bonds, Police and Courthouse Facility Project, Series 2001A, 5.000%, 10/01/26 - MBIA Insured 1,000 Grand Rapids Building Authority, Kent County, Michigan, No Opt. Call AA 1,056,240 Limited Tax General Obligation Bonds, Series 1998, 5.000%, 4/01/16 1,145 Grand Rapids Building Authority, Kent County, Michigan, 10/11 at 100.00 AAA 1,147,187 Limited Tax General Obligation Bonds, Series 2001, 5.125%, 10/01/26 - MBIA Insured 255 Michigan Municipal Bond Authority, Local Government Loan 11/03 at 101.00 A 257,976 Program Revenue Sharing Bonds, Series 1992D, 6.650%, 5/01/12 750 Michigan State Building Authority, Facilities Program 10/09 at 100.00 AA+ 727,268 Revenue Refunding Bonds, Series 1998I, 4.750%, 10/15/21 Michigan State, Certificates of Participation, Series 2000: 2,000 5.500%, 6/01/19 - AMBAC Insured 6/10 at 100.00 AAA 2,106,300 2,000 5.500%, 6/01/27 - AMBAC Insured 6/10 at 100.00 AAA 2,045,060 1,000 Michigan State, Certificates of Participation, New Center 9/11 at 100.00 AAA 1,026,650 Development, Inc., Series 2001, 5.375%, 9/01/21 - MBIA Insured 1,000 Michigan State Trunk Line, Trunk Line Fund Bonds, 11/11 at 100.00 AAA 986,050 Series 2001A, 5.000%, 11/01/25 3,500 Michigan State Trunk Line, Refunding Bonds, Series 2002, 10/12 at 100.00 AAA 3,588,060 5.250%, 10/01/21 - FSA Insured 1,100 Muskegon County, Michigan, Limited Tax General Obligation 7/11 at 100.00 AAA 1,081,531 Wastewater Management System 2 Revenue Bonds, Series 2002, 5.000%, 7/01/26 - FGIC Insured Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 1996Y: 4,100 5.500%, 7/01/36 7/16 at 100.00 A 4,180,401 2,000 5.000%, 7/01/36 7/16 at 100.00 A 1,895,620 1,000 Puerto Rico Public Finance Corporation, Commonwealth No Opt. Call BBB+ 1,091,720 Appropriation Bonds, Series 2002E, 6.000%, 8/01/26 5,000 Wayne County, Michigan, Limited Tax General Obligation 12/11 at 101.00 AAA 4,990,750 Airport Hotel Revenue Bonds, Detroit Metropolitan Wayne County Airport, Series 2001A, 5.000%, 12/01/21 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 2.8% 1,000 Capital Region Airport Authority, Michigan, Revenue Refunding 7/12 at 100.00 AAA 999,380 Bonds, Series 2002, 5.250%, 7/01/21 (Alternative Minimum Tax) - MBIA Insured 3,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 2,841,120 Metropolitan Wayne County Airport, Series 1998A, 5.000%, 12/01/28 (Alternative Minimum Tax) - MBIA Insured 1,195 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 1,153,067 Metropolitan Wayne County Airport, Series 1998B, 4.875%, 12/01/23 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 24.9% 2,190 Anchor Bay School District, Macomb and St. Clair 5/09 at 100.00 AAA 2,517,668 Counties, Michigan, General Obligation School Building and Site Bonds - Unlimited Tax, Series 1999-I, 6.000%, 5/01/29 (Pre-refunded to 5/01/09) - FGIC Insured 275 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 7/10 at 100.00 AAA 306,191 Asset-Backed Bonds, Series 2000, 5.750%, 7/01/20 (Pre-refunded to 7/01/10) 1,000 Detroit, Michigan, Sewage Disposal System Revenue Bonds, 1/10 at 101.00 AAA 1,144,340 Series 1999A, 5.875%, 7/01/27 (Pre-refunded to 1/01/10) - FGIC Insured 950 Detroit, Michigan, Sewerage Disposal System Revenue 7/07 at 101.00 AAA 1,068,285 Bonds, Series 1997A, 5.500%, 7/01/20 (Pre-refunded to 7/01/07) - MBIA Insured 2,000 Detroit, Michigan, Water Supply System Revenue Bonds, 1/10 at 101.00 AAA 2,273,180 Senior Lien, Series 1999A, 5.750%, 7/01/26 (Pre-refunded to 1/01/10) - FGIC Insured 17 Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (continued) Detroit, Michigan, Water Supply System Revenue Bonds, Senior Lien, Series 2001A: $ 3,400 5.750%, 7/01/28 (Pre-refunded to 7/01/11) - FGIC Insured 7/11 at 101.00 AAA $ 3,891,062 770 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 7/11 at 100.00 AAA 849,287 2,000 East Grand Rapids Public Schools, Kent County, Michigan, 5/09 at 100.00 AAA 2,299,240 Unlimited Tax General Obligation School Building and Site Bonds, Series 2000, 6.000%, 5/01/29 (Pre-refunded to 5/01/09) - FSA Insured 2,000 Grand Rapids Township Economic Development Corporation, 7/09 at 101.00 A-*** 2,254,460 Michigan, Limited Obligation Revenue Bonds, Porter Hills Obligated Group, Cook Valley Estate Project, Series 1999, 5.450%, 7/01/29 (Pre-refunded to 7/01/09) 1,000 Grosse Ile Township School District, Michigan, School 5/07 at 100.00 AAA 1,129,820 Improvement Refunding Bonds, Series 1996, 6.000%, 5/01/22 (Pre-refunded to 5/01/07) - FGIC Insured 2,000 Lincoln Park School District, Wayne County, Michigan, General 5/06 at 101.00 AAA 2,232,800 Obligation Bonds, Series 1996, 5.900%, 5/01/26 (Pre-refunded to 5/01/06) - FGIC Insured Michigan State Hospital Finance Authority, Revenue Bonds, Ascension Health Credit Group, Series 1999A: 1,000 6.125%, 11/15/23 (Pre-refunded to 11/15/09) - MBIA Insured 11/09 at 101.00 AAA 1,177,630 2,500 6.125%, 11/15/26 (Pre-refunded to 11/15/09) 11/09 at 101.00 AAA 2,944,075 3,460 Michigan State Hospital Finance Authority, Revenue Refunding 5/08 at 101.00 AAA 3,468,650 Bonds, St. John's Health System, Series 1998A, 5.000%, 5/15/28 - AMBAC Insured 2,875 Milan Area Schools, Washtenaw and Monroe Counties, 5/10 at 100.00 AAA 3,261,659 Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 2000A, 5.750%, 5/01/24 (Pre-refunded to 5/01/10) - FGIC Insured 1,045 Nice Community School District, Marquette and Baraga 5/04 at 101.00 AAA 1,089,089 Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1995, 5.250%, 5/01/20 (Pre-refunded to 5/01/04) - MBIA Insured 1,125 Puerto Rico Highway and Transportation Authority, Highway 7/10 at 101.00 A*** 1,311,671 Revenue Bonds, Series 2000B, 6.000%, 7/01/39 (Pre-refunded to 7/01/10) 2,100 Romulus Community Schools, Wayne County, Michigan, 5/09 at 100.00 AAA 2,386,776 Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 5.750%, 5/01/25 (Pre-refunded to 5/01/09) - FGIC Insured 4,845 Saginaw-Midland Municipal Water Supply Corporation, 9/04 at 102.00 A2*** 5,246,263 Michigan, Limited Tax General Obligation Water Supply Revenue Bonds, Series 1992, 6.875%, 9/01/16 (Pre-refunded to 9/01/04) 2,600 West Bloomfield School District, Oakland County, Michigan, 5/10 at 100.00 AAA 2,974,608 Unlimited Tax General Obligation School Building and Site Bonds, Series 2000, 5.900%, 5/01/18 (Pre-refunded to 5/01/10) - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 11.8% 3,000 Michigan Public Power Agency, Revenue Bonds, Combustion 1/12 at 100.00 AAA 3,031,380 Turbine 1 Project, Series 2001A, 5.250%, 1/01/27 - AMBAC Insured 4,475 Michigan South Central Power Agency, Power Supply System No Opt. Call Baa1 4,796,797 Revenue Bonds, Series 2000, 6.000%, 5/01/12 3,630 Michigan Strategic Fund, Limited Obligation Refunding No Opt. Call AAA 4,479,747 Revenue Bonds, Detroit Edison Company, Series 1991BB, 7.000%, 5/01/21 - AMBAC Insured 2,000 Michigan Strategic Fund, Limited Obligation Revenue No Opt. Call Aaa 2,105,060 Refunding and Remarketing Bonds, Detroit Edison Company, Series 1995CC, 4.850%, 9/01/30 (Mandatory put 9/01/11) 4,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/11 at 100.00 A- 4,005,760 Revenue Refunding Pollution Control Bonds, Detroit Edison Company, Series 2001C, 5.450%, 9/01/29 1,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/09 at 102.00 AAA 1,018,650 Revenue Refunding Pollution Control Bonds, Detroit Edison Company, Series 1999A, 5.550%, 9/01/29 (Alternative Minimum Tax) - MBIA Insured 400 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/10 at 101.00 AAA 405,148 Series 2000HH, 5.250%, 7/01/29 - FSA Insured 1,000 Puerto Rico Electric Power Authority, Power Revenue 7/05 at 100.00 A- 1,000,850 Bonds, Series 1995X, 5.500%, 7/01/25 18 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 13.8% $ 1,500 Detroit, Michigan, Sewage Disposal System Revenue Refunding 7/05 at 101.00 AAA $ 1,517,910 Bonds, Series 1995B, 5.250%, 7/01/21 - MBIA Insured 1,500 Detroit, Michigan, Sewage Disposal System Revenue Bonds, No Opt. Call AAA 1,595,760 Second Lien, Series 2001B, 5.500%, 7/01/29 - FGIC Insured 2,500 Detroit, Michigan, Sewage Disposal System Revenue 7/13 at 100.00 AAA 2,434,650 Refunding Bonds, Senior Lien, Series 2003A, 5.000%, 7/01/32 - FSA Insured Detroit, Michigan, Sewerage Disposal System Revenue Bonds, Series 1997A: 2,050 5.500%, 7/01/20 - MBIA Insured 7/07 at 101.00 AAA 2,134,153 1,730 5.000%, 7/01/22 - MBIA Insured 7/07 at 101.00 AAA 1,732,560 Detroit, Michigan, Water Supply System Senior Lien Revenue Bonds, Series 2003A: 4,025 5.000%, 7/01/24 - MBIA Insured 7/13 at 100.00 AAA 3,986,199 3,000 5.000%, 7/01/25 - MBIA Insured 7/13 at 100.00 AAA 2,958,600 730 Detroit, Michigan, Water Supply System Revenue Bonds, 7/11 at 100.00 AAA 734,898 Senior Lien, Series 2001A, 5.250%, 7/01/33 - FGIC Insured 5,000 Detroit, Michigan, Water Supply System Revenue Refunding 7/04 at 102.00 AAA 4,993,550 Bonds, Series 1993, 5.000%, 7/01/23 - FGIC Insured Muskegon Heights, Muskegon County, Michigan, Water Supply System Revenue Bonds, Series 2000A: 1,040 5.625%, 11/01/25 - MBIA Insured 11/10 at 100.00 Aaa 1,082,243 1,160 5.625%, 11/01/30 - MBIA Insured 11/10 at 100.00 Aaa 1,205,110 - ------------------------------------------------------------------------------------------------------------------------------------ $ 259,627 Total Long-Term Investments (cost $253,858,257) - 150.1% 264,487,396 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 0.9% 1,635 Eastern Michigan University, Variable Rate Demand Revenue A-1+ 1,635,000 Refunding Bonds, Series 0.900%, 6/01/27 - FGIC Insured+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 1,635 Total Short-Term Investments (cost $1,635,000) 1,635,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $255,493,257) - 151.0% 266,122,396 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.4% 4,063,666 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (53.4)% (94,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $176,186,062 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 19
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 0.7% $ 970 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 A- $ 841,213 Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 6.4% 1,000 Eastern Michigan University, General Revenue Bonds, 6/13 at 100.00 AAA 978,630 Series 2003, 5.000%, 6/01/28 - FGIC Insured 2,000 Michigan Higher Education Student Loan Authority, Revenue 9/12 at 100.00 AAA 2,009,100 Bonds, Series 2002 XVII-G, 5.200%, 9/01/20 (Alternative Minimum Tax) - AMBAC Insured 1,000 Saginaw Valley State University, Michigan, General Revenue 7/09 at 100.00 Aaa 1,033,590 Bonds, Series 1999, 5.625%, 7/01/29 - AMBAC Insured 3,500 Wayne State University, Michigan, General Revenue Bonds, 11/09 at 101.00 AAA 3,494,715 Series 1999, 5.125%, 11/15/29 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 20.1% 2,050 Dearborn Hospital Finance Authority, Michigan, Economic 11/05 at 102.00 AAA 2,125,338 Development Corp., Hospital Revenue Bonds, Oakwood Obligated Group, Series 1995A, 5.875%, 11/15/25 - FGIC Insured 2,200 Hancock Hospital Finance Authority, Michigan, FHA-Insured 8/08 at 100.00 AAA 2,203,806 Mortgage Hospital Revenue Bonds, Portage Health System, Inc., Series 1998, 5.450%, 8/01/47 - MBIA Insured 2,500 Kalamazoo Hospital Finance Authority, Michigan, Hospital 5/06 at 102.00 AAA 2,652,425 Revenue Refunding and Improvement Bonds, Bronson Methodist Hospital, Series 1996, 5.750%, 5/15/16 - MBIA Insured Michigan State Hospital Finance Authority, Revenue and Refunding Bonds, Detroit Medical Center Obligated Group, Series 1993A: 2,000 6.250%, 8/15/13 8/03 at 102.00 Ba3 1,600,640 3,200 6.500%, 8/15/18 8/03 at 102.00 Ba3 2,469,088 1,500 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 1,533,360 Refunding Bonds, Henry Ford Health System, Series 2003A, 5.625%, 3/01/17 2,000 Michigan State Hospital Finance Authority, Hospital Revenue 1/05 at 102.00 A+ 2,048,840 and Refunding Bonds, Otsego Memorial Hospital-Gaylord, Series 1995, 6.250%, 1/01/20 4,000 Michigan State Hospital Finance Authority, Hospital Revenue 5/09 at 101.00 AAA 4,087,440 Refunding Bonds, Mercy Mount Clemens Corporation Obligated Group, Series 1999A, 5.750%, 5/15/29 - MBIA Insured 500 Michigan State Hospital Finance Authority, Hospital Revenue 11/11 at 101.00 A1 490,925 Refunding Bonds, Sparrow Obligated Group, Series 2001, 5.625%, 11/15/31 4,300 Michigan State Hospital Finance Authority, Hospital Revenue 11/09 at 101.00 A1 4,413,821 Bonds, Henry Ford Health System, Series 1999A, 6.000%, 11/15/24 - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 8.0% 1,335 Michigan Housing Development Authority, Multifamily Senior 12/10 at 100.00 AAA 1,355,452 Lien Revenue Bonds, Landings Project, Series 2001A, 5.950%, 12/01/33 (Alternative Minimum Tax) - AMBAC Insured 1,000 Michigan Housing Development Authority, GNMA Collateralized 4/12 at 102.00 Aaa 1,001,040 Limited Obligation Multifamily Housing Revenue Bonds, Burkshire Pointe Apartments, Series 2002A, 5.400%, 10/20/32 (Alternative Minimum Tax) 500 Michigan Housing Development Authority, FNMA Enhanced 9/15 at 100.00 Aaa 497,640 Limited Obligation Multifamily Revenue Bonds, Renaissance Apartments, Series 2002, 5.350%, 8/01/22 (Alternative Minimum Tax) 2,400 Michigan State Housing Development Authority, Limited 4/04 at 103.00 AAA 2,460,072 Obligation Revenue Bonds, Walled Lake Villa Project, Series 1993, 6.000%, 4/15/18 - FSA Insured 1,500 Michigan State Housing Development Authority, Limited 10/03 at 103.00 AAA 1,520,895 Obligation Revenue Bonds, Breton Village Green Project, Series 1993, 5.625%, 10/15/18 - FSA Insured 20 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY (continued) Mount Clemens Housing Corporation, Michigan, FHA-Insured Section 8 Multifamily Housing Revenue Refunding Bonds, Clinton Place Project, Series 1992A: $ 1,000 6.600%, 6/01/13 12/03 at 102.00 AAA $ 1,020,810 1,500 6.600%, 6/01/22 12/03 at 102.00 AAA 1,527,990 - ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 1.2% 1,370 Michigan Strategic Fund, Limited Obligation Revenue Bonds, 12/03 at 102.00 BBB 1,402,757 WMX Technologies, Inc. Project, Series 1993, 6.000%, 12/01/13 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 22.8% 3,000 Allen Park Public School District, Wayne County, Michigan, 5/13 at 100.00 AAA 2,929,710 General Obligation Bonds, Series 2003, 5.000%, 5/01/29 2,305 Caledonia Community Schools, Kent, Allegan and Barry 5/13 at 100.00 AAA 2,461,648 Counties, Michigan, General Obligation Bonds, Series 2003, 5.250%, 5/01/15 1,000 Central Montcalm Public Schools, Montcalm and Ionia 5/09 at 100.00 AAA 1,055,890 Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 5.750%, 5/01/24 - MBIA Insured Detroit School District, Wayne County, Michigan, General Obligation Bonds, Series 2002A: 1,815 6.000%, 5/01/20 - FGIC Insured No Opt. Call AAA 2,076,033 750 6.000%, 5/01/21 - FGIC Insured No Opt. Call AAA 855,188 2,500 Detroit School District, Wayne County, Michigan, General 5/13 at 100.00 AAA 2,485,850 Obligation Bonds, Series 2003B, 5.000%, 5/01/23 - FGIC Insured 500 Detroit School District, Wayne County, Michigan, Unlimited 5/12 at 100.00 AAA 523,820 Tax General Obligation School Building and Site Improvement Bonds, Series 2001A, 5.500%, 5/01/21 - FSA Insured 1,000 Durand Area Schools, Shiawasee County, Michigan, General 5/07 at 100.00 AAA 1,015,840 Obligation Bonds, Series 1997, 5.375%, 5/01/23 - FGIC Insured 3,815 East Lansing Building Authority, Ingham and Clinton 4/11 at 100.00 AA 3,901,257 Counties, Michigan, Unlimited Tax General Obligation Building Authority Bonds, Series 2000, 5.375%, 4/01/25 1,000 Oxford Area Community Schools, Oakland and Lapeer 11/11 at 100.00 AAA 1,069,130 Counties, Michigan, General Obligation Bonds, Series 2001, 5.500%, 5/01/17 380 Reeths-Puffer Schools, Muskegon County, Michigan, School 5/05 at 101.00 AAA 405,316 Building and Site Refunding Bonds, Series 1995, 5.750%, 5/01/15 - FGIC Insured 1,000 Rochester Community School District, Oakland and 5/10 at 100.00 AAA 1,082,210 Macomb Counties, Michigan, General Obligation Bonds, Series 2000I, 5.750%, 5/01/19 - FGIC Insured South Lyon Community Schools, Oakland, Washtenaw, and Livingston Counties, Michigan, General Obligation Bonds, Series 2003: 2,350 5.250%, 5/01/19 - FGIC Insured 11/12 at 100.00 AAA 2,436,057 1,575 5.250%, 5/01/22 - FGIC Insured 11/12 at 100.00 AAA 1,609,020 2,830 Warren Consolidated School District, Macomb and Oakland 5/13 at 100.00 AAA 2,922,456 Counties, Michigan, General Obligation Refunding Bonds, Series 2003, 5.250%, 5/01/20 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 23.1% 5,750 Detroit, Michigan, Convention Facility Limited Tax Revenue 9/03 at 102.00 AAA 5,900,708 Refunding Bonds, Cobo Hall Expansion Project, Series 1993, 5.250%, 9/30/12 - FSA Insured 7,000 Detroit-Wayne County Stadium Authority, Michigan, 2/07 at 102.00 AAA 7,043,120 Limited Tax General Obligation Building Authority Stadium Bonds, Series 1997, 5.250%, 2/01/27 - FGIC Insured 1,500 Michigan State Building Authority, Facilities Program 10/10 at 100.00 AA+ 1,552,095 Revenue Bonds, Series 2000I, 5.375%, 10/15/20 Michigan State Building Authority, Facilities Program Revenue Refunding Bonds, Series 2001I: 2,570 5.500%, 10/15/19 10/11 at 100.00 AA+ 2,714,897 6,500 5.000%, 10/15/24 10/11 at 100.00 AA+ 6,444,945 1,000 Michigan State, Certificates of Participation, New Center 9/11 at 100.00 AAA 1,026,650 Development, Inc., Series 2001, 5.375%, 9/01/21 - MBIA Insured 21 Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) $ 1,500 Michigan State, Comprehensive Transportation Revenue 11/11 at 100.00 AAA $ 1,524,210 Refunding Bonds, Series 2001A, 5.000%, 11/01/19 - FSA Insured 1,000 Puerto Rico Highway and Transportation Authority, Highway 7/16 at 100.00 A 947,810 Revenue Bonds, Series 1996Y, 5.000%, 7/01/36 - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 2.9% 1,000 Puerto Rico Ports Authority, Special Facilities Revenue 12/03 at 102.00 CCC 539,990 Bonds, American Airlines, Inc. Project, Series 1993A, 6.300%, 6/01/23 (Alternative Minimum Tax) 2,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 1,894,080 Metropolitan Wayne County Airport, Series 1998A, 5.000%, 12/01/28 (Alternative Minimum Tax) - MBIA Insured 1,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 964,910 Metropolitan Wayne County Airport, Series 1998B, 4.875%, 12/01/23 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 31.2% 395 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 7/10 at 100.00 AAA 439,801 Asset-Backed Bonds, Series 2000, 5.750%, 7/01/20 (Pre-refunded to 7/01/10) 2,000 Detroit, Michigan, Sewage Disposal System Revenue Bonds, 1/10 at 101.00 AAA 2,288,680 Series 1999A, 5.875%, 7/01/27 (Pre-refunded to 1/01/10) - FGIC Insured 630 Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/07 at 101.00 AAA 708,441 Series 1997A, 5.500%, 7/01/20 (Pre-refunded to 7/01/07) - MBIA Insured 1,385 Detroit, Michigan, Water Supply System Revenue Bonds, 7/11 at 100.00 AAA 1,527,613 Senior Lien, Series 2001A, 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 4,000 Detroit, Michigan, Water Supply System Revenue Bonds, 1/10 at 101.00 AAA 4,546,360 Senior Lien, Series 1999A, 5.750%, 7/01/26 (Pre-refunded to 1/01/10) - FGIC Insured 3,000 Eastern Michigan University, General Revenue Bonds, 12/06 at 101.00 AAA 3,365,040 Series 1997, 5.500%, 6/01/27 (Pre-refunded to 12/01/06) - FGIC Insured 2,000 Ferris State College, Michigan, General Revenue Bonds, 10/03 at 102.00 AAA 2,057,660 Series 1993, 6.250%, 10/01/19 (Pre-refunded to 10/01/03) - AMBAC Insured 1,950 Michigan Municipal Bond Authority, State Revolving Fund No Opt. Call AAA 1,969,715 Revenue Bonds, Series 1994, 7.000%, 10/01/03 5,000 Michigan Municipal Bond Authority, Drinking Water Revolving 10/09 at 101.00 AAA 5,702,450 Fund Revenue Bonds, Series 1999, 5.500%, 10/01/21 (Pre-refunded to 10/01/09) 3,000 Michigan State Hospital Finance Authority, Hospital Revenue 11/03 at 102.00 AAA 3,073,020 Refunding Bonds, St. John's Hospital, Series 1993A, 6.000%, 5/15/13 - AMBAC Insured 2,500 Michigan State Hospital Finance Authority, Revenue Bonds, 11/09 at 101.00 AAA 2,944,075 Ascension Health Credit Group, Series 1999A, 6.125%, 11/15/26 (Pre-refunded to 11/15/09) 1,240 Milan Area Schools, Washtenaw and Monroe Counties, 5/10 at 100.00 AAA 1,397,517 Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 2000A, 5.625%, 5/01/16 (Pre-refunded to 5/01/10) - FGIC Insured 1,100 Puerto Rico Public Improvement, General Obligation 7/07 at 101.50 A-*** 1,249,534 Refunding Bonds, Series 1997, 5.750%, 7/01/17 (Pre-refunded to 7/01/07) 620 Reeths-Puffer Schools, Muskegon County, Michigan, 5/05 at 101.00 AAA 672,601 School Building and Site Refunding Bonds, Series 1995, 5.750%, 5/01/15 (Pre-refunded to 5/01/05) - FGIC Insured 1,500 Romulus Community Schools, Wayne County, Michigan, 5/09 at 100.00 AAA 1,704,840 Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 5.750%, 5/01/25 (Pre-refunded to 5/01/09) - FGIC Insured 2,500 West Bloomfield School District, Oakland County, Michigan, 5/10 at 100.00 AAA 2,845,300 Unlimited Tax General Obligation School Building and Site Bonds, Series 2000, 5.800%, 5/01/17 (Pre-refunded to 5/01/10) - FGIC Insured 22 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 22.9% $ 1,000 Michigan Public Power Agency, Revenue Bonds, Combustion 1/12 at 100.00 AAA $ 1,010,460 Turbine 1 Project, Series 2001A, 5.250%, 1/01/27 - AMBAC Insured 1,000 Michigan South Central Power Agency, Power Supply System No Opt. Call Baa1 1,071,910 Revenue Bonds, Series 2000, 6.000%, 5/01/12 3,500 Michigan Strategic Fund, Collateralized Limited Obligation 12/03 at 102.00 AAA 3,582,425 Revenue Refunding Bonds, Consumers Power Company Project, Series 1993B, 5.800%, 6/15/10 - CAPMAC Insured 3,000 Michigan Strategic Fund, Limited Obligation Revenue No Opt. Call Aaa 3,157,590 Refunding and Remarketing Bonds, Detroit Edison Company, Series 1995CC, 4.850%, 9/01/30 (Mandatory put 9/01/11) 5,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/11 at 100.00 A- 5,007,200 Revenue Refunding Pollution Control Bonds, Detroit Edison Company, Series 2001C, 5.450%, 9/01/29 1,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/09 at 102.00 AAA 1,018,650 Revenue Refunding Pollution Control Bonds, Detroit Edison Company, Series 1999A, 5.550%, 9/01/29 (Alternative Minimum Tax) - MBIA Insured Monroe County, Michigan, Pollution Control Revenue Bonds, Detroit Edison Company Project, Series 1992CC: 2,500 6.550%, 6/01/24 (Alternative Minimum Tax) - MBIA Insured 12/03 at 102.00 AAA 2,587,575 1,500 6.550%, 9/01/24 (Alternative Minimum Tax) - MBIA Insured 9/03 at 102.00 AAA 1,535,625 6,000 Monroe County, Michigan, Pollution Control Revenue Bonds, No Opt. Call AAA 6,388,920 Detroit Edison Company Project, Series 1994A, 6.350%, 12/01/04 (Alternative Minimum Tax) - AMBAC Insured 1,500 Wyandotte, Michigan, Electric Revenue Refunding Bonds, 10/08 at 101.00 AAA 1,586,085 Series 2002, 5.375%, 10/01/17 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 5.8% 1,500 Detroit, Michigan, Sewage Disposal System Revenue Bonds, No Opt. Call AAA 1,595,760 Second Lien, Series 2001B, 5.500%, 7/01/29 - FGIC Insured 2,500 Detroit, Michigan, Sewage Disposal System Revenue 7/13 at 100.00 AAA 2,434,650 Refunding Bonds, Senior Lien, Series 2003A, 5.000%, 7/01/32 - FSA Insured 1,370 Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/07 at 101.00 AAA 1,426,239 Series 1997A, 5.500%, 7/01/20 - MBIA Insured 1,315 Detroit, Michigan, Water Supply System Revenue Bonds, 7/11 at 100.00 AAA 1,323,821 Senior Lien, Series 2001A, 5.250%, 7/01/33 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ $ 165,470 Total Long-Term Investments (cost $163,801,871) - 145.1% 170,371,984 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.6% 3,046,395 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (47.7)% (56,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $117,418,379 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. See accompanying notes to financial statements. 23
Nuveen Michigan Dividend Advantage Municipal Fund (NZW) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 3.8% $ 1,150 Michigan Higher Education Facilities Authority, Limited 9/11 at 100.00 Aaa $ 1,130,623 Obligation Revenue Refunding Bonds, Kettering University, Series 2001, 5.000%, 9/01/26 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 17.2% 1,000 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/11 at 101.00 AA 991,520 Spectrum Health, Series 2001A, 5.250%, 1/15/21 1,200 Michigan State Hospital Finance Authority, Hospital Revenue 1/06 at 102.00 Ba3 961,848 Refunding Bonds, Sinai Hospital, Series 1995, 6.625%, 1/01/16 600 Michigan State Hospital Finance Authority, Hospital Revenue 5/06 at 102.00 A1 582,372 and Refunding Bonds, Henry Ford Health System, Series 1995A, 5.250%, 11/15/20 750 Michigan State Hospital Finance Authority, Hospital Revenue 11/11 at 101.00 A1 736,388 Refunding Bonds, Sparrow Obligated Group, Series 2001, 5.625%, 11/15/31 1,800 Royal Oak, Michigan, Hospital Finance Authority, Hospital 11/11 at 100.00 AAA 1,799,856 Revenue Bonds, William Beaumont Hospital, Series 2001M, 5.250%, 11/15/31 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 5.8% 1,700 Michigan Housing Development Authority, GNMA 8/12 at 102.00 Aaa 1,708,942 Collateralized Limited Obligation Multifamily Housing Revenue Bonds, Cranbrook Apartments, Series 2001A, 5.400%, 2/20/31 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 4.3% 1,250 Michigan Housing Development Authority, Single Family 1/11 at 100.00 AAA 1,275,113 Mortgage Revenue Bonds, Series 2001, 5.300%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 52.0% 1,000 Detroit School District, Wayne County, Michigan, General 5/13 at 100.00 AAA 1,029,750 Obligation Bonds, Series 2002A, 5.375%, 5/01/24 - FGIC Insured 1,000 Detroit School District, Wayne County, Michigan, Unlimited 5/12 at 100.00 AAA 1,047,640 Tax School Building and Site Improvement General Obligation Bonds, Series 2001A, 5.500%, 5/01/21 - FSA Insured 1,000 Garden City School District, Wayne County, Michigan, 5/11 at 100.00 AAA 983,240 General Obligation Refunding Bonds, Series 2001, 5.000%, 5/01/26 1,300 Harper Creek Community School District, Calhoun County, 5/11 at 100.00 AAA 1,296,074 Michigan, General Obligation Bonds, Series 2001, 5.125%, 5/01/31 2,200 Huron School District, Wayne and Monroe Counties, 5/11 at 100.00 AAA 2,247,322 Michigan, General Obligation Bonds, Series 2001, 5.375%, 5/01/26 - FSA Insured 1,500 Huron Valley School District, Oakland and Livingston 11/11 at 100.00 AAA 1,472,880 Counties, Michigan, General Obligation Bonds, Series 2001, 5.000%, 5/01/27 1,050 Lawton Community Schools, Van Buren County, Michigan, 11/11 at 100.00 AAA 1,092,536 General Obligation Bonds, Series 2001, 5.500%, 5/01/21 1,000 Portland Public Schools, Ionia County, Michigan, General 11/11 at 100.00 AAA 976,570 Obligation Bonds, Series 2001, 5.000%, 5/01/29 1,000 Puerto Rico Public Improvement, General Obligation Bonds, 7/11 at 100.00 A- 971,060 Series 2002A, 5.125%, 7/01/31 1,000 Rochester Community School District, Oakland and Macomb 11/11 at 100.00 AAA 1,034,470 Counties, Michigan, General Obligation Bonds, Series 2001II, 5.500%, 5/01/22 500 Warren Building Authority, Michigan, Limited Tax General 11/10 at 100.00 AAA 505,140 Obligation Bonds, Series 2001, 5.150%, 11/01/22 - FGIC Insured 24 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) Washtenaw County, Michigan, Limited Tax General Obligation Bonds, Sylvan Township Water and Wastewater System, Series 2001: $ 500 5.000%, 5/01/19 - MBIA Insured 5/09 at 100.50 AAA $ 508,350 800 5.000%, 5/01/20 - MBIA Insured 5/09 at 100.50 AAA 809,552 1,300 Willow Run Community Schools, Washtenaw County, 5/11 at 100.00 AAA 1,304,459 Michigan, General Obligation Bonds, Series 2001, 5.000%, 5/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 29.5% 1,300 Grand Rapids Building Authority, Kent County, Michigan, 10/11 at 100.00 AAA 1,302,483 Limited Tax General Obligation Bonds, Series 2001, 5.125%, 10/01/26 - MBIA Insured 1,205 Michigan State Building Authority, Facilities Program Revenue 10/11 at 100.00 AA+ 1,194,794 Refunding Bonds, Series 2001I, 5.000%, 10/15/24 2,000 Michigan State Trunk Line, Trunk Line Fund Bonds, 11/11 at 100.00 AAA 1,972,100 Series 2001A, 5.000%, 11/01/25 1,450 Muskegon County, Michigan, Limited Tax General 7/11 at 100.00 AAA 1,425,655 Obligation Wastewater Management System 2 Revenue Bonds, Series 2002, 5.000%, 7/01/26 - FGIC Insured 1,000 Puerto Rico Public Finance Corporation, Commonwealth No Opt. Call BBB+ 1,091,720 Appropriation Bonds, Series 2002E, 6.000%, 8/01/26 1,750 Wayne County, Michigan, Limited Tax General Obligation 12/11 at 101.00 AAA 1,695,400 Airport Hotel Revenue Bonds, Detroit Metropolitan Wayne County Airport, Series 2001A, 5.000%, 12/01/30 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 5.6% 1,750 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 1,657,320 Metropolitan Wayne County Airport, Series 1998A, 5.000%, 12/01/28 (Alternative Minimum Tax) - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 7.6% 515 Detroit, Michigan, Water Supply System Revenue Bonds, 7/11 at 100.00 AAA 568,030 Senior Lien, Series 2001A, 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 1,000 Michigan Municipal Bond Authority, Drinking Water 10/10 at 101.00 AAA 1,158,170 Revolving Fund Revenue Bonds, Series 2000, 5.875%, 10/01/17 (Pre-refunded to 10/01/10) 500 Puerto Rico Infrastructure Financing Authority, Special 10/10 at 101.00 AAA 525,625 Obligation Bonds, Series 2000A, 5.500%, 10/01/40 - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 11.8% 1,235 Michigan Public Power Agency, Revenue Bonds, Combustion 1/12 at 100.00 AAA 1,252,129 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 A- 2,217,724 Revenue Refunding Pollution Control Bonds, Fixed-Rate Conversion, Detroit Edison Company, Series 1999C, 5.650%, 9/01/29 (Alternative Minimum Tax) 25 Nuveen Michigan Dividend Advantage Municipal Fund (NZW) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 8.6% $ 1,000 Detroit, Michigan, Sewage Disposal System Revenue Bonds, No Opt. Call AAA $ 1,063,840 Second Lien, Series 2001B, 5.500%, 7/01/29 - FGIC Insured Detroit, Michigan, Water Supply System Revenue Bonds, Senior Lien, Series 2001A: 1,000 5.000%, 7/01/30 - FGIC Insured 7/11 at 100.00 AAA 976,110 485 5.250%, 7/01/33 - FGIC Insured 7/11 at 100.00 AAA 488,252 - ------------------------------------------------------------------------------------------------------------------------------------ $ 43,005 Total Long-Term Investments (cost $42,898,673) - 146.2% 43,055,057 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 8.1% 2,388,431 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (54.3)% (16,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $29,443,488 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. See accompanying notes to financial statements. 26
Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.4% $ 4,320 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 A- $ 3,746,434 Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 4.7% 3,665 Ohio State Education, Student Loan Revenue Bonds, 6/07 at 102.00 AAA 3,795,547 Supplemental Student Loan Program, Series 1997A-1, 5.850%, 12/01/19 (Alternative Minimum Tax) - AMBAC Insured 1,000 Ohio Higher Education Facilities Commission, Revenue 12/04 at 102.00 AAA 1,068,370 Bonds, University of Dayton Project, Series 1994, 5.800%, 12/01/14 - FGIC Insured 1,200 Ohio Higher Education Facilities Commission, Revenue 9/06 at 101.00 Ba1 1,191,936 Bonds, University of Findlay Project, Series 1996, 6.125%, 9/01/16 1,200 Ohio State University, General Receipts Bonds, 12/12 at 100.00 AA 1,198,128 Series 2002A, 5.125%, 12/01/31 - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 20.9% 2,675 Clermont County, Ohio, Hospital Facilities Revenue Refunding 1/04 at 101.00 AAA 2,736,632 Bonds, Mercy Health System, Series 1993A, 5.875%, 1/01/15 - MBIA Insured 1,000 Cuyahoga County, Ohio, Hospital Improvement and Revenue 2/07 at 102.00 AAA 1,069,740 Refunding Bonds, The MetroHealth System Project, Series 1997, 5.625%, 2/15/17 - MBIA Insured 2,000 Cuyahoga County, Ohio, Revenue Refunding Bonds, 7/13 at 100.00 A1 2,062,440 Cleveland Clinic Health System, Series 2003A, 6.000%, 1/01/32 2,500 Erie County, Ohio, Hospital Facilities Revenue Bonds, 8/12 at 101.00 A 2,489,300 Firelands Regional Medical Center, Series 2002A, 5.625%, 8/15/32 Franklin County, Ohio, Hospital Revenue Refunding and Improvement Bonds, Children's Hospital Project, Series 1996A: 1,000 5.750%, 11/01/20 11/06 at 101.00 Aa2 1,019,690 1,500 5.875%, 11/01/25 11/06 at 101.00 Aa2 1,526,310 2,500 Marion County, Ohio, Hospital Revenue Refunding and 5/06 at 102.00 BBB+ 2,625,300 Improvement Bonds, The Community Hospital, Series 1996, 6.375%, 5/15/11 2,405 Miami County, Ohio, Hospital Facilities Revenue Refunding 5/06 at 102.00 BBB+ 2,456,275 and Improvement Bonds, Upper Valley Medical Center, Series 1996A, 6.250%, 5/15/16 1,500 Montgomery County, Ohio, Hospital Facilities Revenue 4/06 at 102.00 AAA 1,615,665 Refunding and Improvement Bonds, Kettering Medical Center, Series 1996, 5.625%, 4/01/16 - MBIA Insured 3,000 Montgomery County, Ohio, Hospital Facilities Revenue 4/10 at 101.00 BBB+ 3,187,020 Bonds, Kettering Medical Center, Series 1999, 6.750%, 4/01/18 6,000 Parma Community General Hospital Association, Ohio, 11/08 at 101.00 A- 5,775,060 Hospital Revenue Refunding and Improvement Bonds, Series 1998, 5.375%, 11/01/29 2,500 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 2,598,400 Improvement Bonds, MedCentral Health System Obligated Group, Series 2000B, 6.375%, 11/15/30 1,500 Steubenville, Ohio, Hospital Facilities Revenue Refunding 10/10 at 100.00 A3 1,569,510 and Improvement Bonds, Trinity Health System, Series 2000, 6.375%, 10/01/20 1,705 Tuscarawas County, Ohio, Hospital Facilities Revenue 10/11 at 101.00 AA 1,773,405 Bonds, Union Hospital Project, Series 2001, 5.750%, 10/01/21 - RAAI Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 11.6% 1,385 Clermont County, Ohio, GNMA Collateralized Mortgage 8/03 at 103.00 Aaa 1,388,379 Revenue Bonds, S.E.M. Villa II Project, Series 1994A, 5.950%, 2/20/30 1,000 Cuyahoga County, Ohio, GNMA Collateralized Mortgage 9/10 at 102.00 Aaa 989,080 Revenue Bonds, West Tech Apartments Project, Series 2002A, 5.350%, 3/20/33 (Alternative Minimum Tax) 27 Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY (continued) $ 1,435 Cuyahoga County, Ohio, GNMA Collateralized Loan 6/08 at 105.00 Aaa $ 1,491,769 Multifamily Housing Revenue Bonds, Water Street Associates Project, Series 1997, 6.150%, 12/20/26 (Alternative Minimum Tax) Cuyahoga County, Ohio, GNMA Collateralized Multifamily Housing Mortgage Revenue Bonds, Longwood Phase One Associates LP Project, Series 2001A: 2,475 5.350%, 1/20/21 (Alternative Minimum Tax) 7/11 at 102.00 Aaa 2,490,147 2,250 5.450%, 1/20/31 (Alternative Minimum Tax) 7/11 at 102.00 Aaa 2,260,598 1,000 Cuyahoga County, Ohio, GNMA Collateralized Multifamily 9/12 at 102.00 Aaa 1,000,430 Housing Revenue Bonds, Livingston Park, Series 2002A, 5.350%, 9/20/27 985 Franklin County, Ohio, FHA-Insured Multifamily Housing 1/05 at 103.00 Aa 986,172 Mortgage Revenue Bonds, Hamilton Creek Apartments Project, Series 1994A, 5.550%, 7/01/24 (Alternative Minimum Tax) 4,060 Lucas Northgate Housing Development Corporation, 1/04 at 102.00 Aaa 4,107,421 Ohio, FHA-Insured Mortgage Revenue Refunding Bonds, Northgate Apartments Section 8 Assisted Project, Series 1999A, 6.000%, 7/01/24 - MBIA Insured 3,265 Ohio Housing Finance Agency, Multifamily Housing Revenue 12/09 at 100.00 AAA 3,376,565 Bonds, Timber Lake Apartments Project, Series 1999C, 6.150%, 12/01/24 (Alternative Minimum Tax) - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 9.6% 2,240 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/09 at 100.00 Aaa 2,335,066 Securities Program Residential Mortgage Revenue Bonds, Series 2000A-1, 6.350%, 9/01/31 (Alternative Minimum Tax) 2,635 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/07 at 102.00 Aaa 2,679,400 Securities Program Residential Mortgage Revenue Bonds, Series 1996B-3, 5.750%, 9/01/28 (Alternative Minimum Tax) 5,000 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/08 at 101.50 AAA 5,038,400 Securities Program Residential Mortgage Revenue Bonds, Series 1998A-1, 5.300%, 9/01/19 (Alternative Minimum Tax) - FSA Insured 3,955 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/08 at 102.00 Aaa 3,962,633 Securities Program Residential Mortgage Revenue Bonds, Series 1997B, 5.400%, 9/01/29 (Alternative Minimum Tax) 905 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/12 at 100.00 Aaa 908,901 Securities Program Residential Mortgage Revenue Bonds, Series 2002D, 5.400%, 9/01/34 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 0.7% 1,000 Marion County, Ohio, Healthcare Facilities Revenue 11/03 at 102.00 BBB- 1,012,620 Refunding and Improvement Bonds, United Church Homes, Inc. Project, Series 1993, 6.300%, 11/15/15 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 32.8% 1,000 Ansonia Local School District, Darke County, Ohio, 12/10 at 102.00 Aaa 1,041,470 General Obligation Bonds, Series 2000, 5.500%, 12/01/22 - MBIA Insured 1,000 Bay Village City School District, Ohio, Unlimited Tax General 12/10 at 100.00 Aa2 991,300 Obligation School Improvement Bonds, Series 2001, 5.000%, 12/01/25 270 Berea City School District, Ohio, Unlimited Tax General 12/03 at 102.00 AAA 281,437 Obligation School Improvement Bonds, Series 1993, 7.500%, 12/15/06 - AMBAC Insured 1,750 Brecksville-Broadview Heights City School District, Ohio, 12/06 at 102.00 AAA 2,002,245 Unlimited Tax General Obligation School Improvement Bonds, Series 1996, 6.500%, 12/01/16 - FGIC Insured 1,000 Cincinnati City School District, Hamilton County, Ohio, 12/11 at 100.00 AAA 1,072,750 General Obligation Bonds, Series 2001, 5.375%, 12/01/15 - MBIA Insured 2,600 Cincinnati City School District, Hamilton County, Ohio, 12/12 at 100.00 AAA 2,668,302 General Obligation Bonds, Series 2002, 5.250%, 6/01/21 - FSA Insured 1,165 Cleveland, Ohio, General Obligation Bonds, Series 2000, 12/10 at 101.00 AAA 1,200,765 5.125%, 12/01/18 - FGIC Insured 2,765 Dayton City School District, Ohio, General Obligation Bonds, 6/13 at 100.00 AAA 2,714,041 Series 2003A, 5.000%, 12/01/27 - FGIC Insured 1,000 Dublin, Ohio, Unlimited Tax Various Purpose Improvement 12/10 at 100.00 Aa1 1,008,180 Bonds, Series 2000A, 5.000%, 12/01/20 1,300 Franklin County, Ohio, Limited Tax General Obligation 12/08 at 102.00 AAA 1,356,108 Refunding Bonds, Series 1993, 5.375%, 12/01/20 28 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 2,000 Garfield Heights City School District, Cuyahoga County, 12/11 at 100.00 Aaa $ 1,976,780 Ohio, General Obligation School Improvement Bonds, Series 2001, 5.000%, 12/15/26 - MBIA Insured 1,000 Hilliard School District, Ohio, General Obligation School 12/10 at 101.00 AAA 1,061,090 Improvement Bonds, Series 2000, 5.750%, 12/01/24 - FGIC Insured 1,160 Kenston Local School District, Geauga County, Ohio, General 6/13 at 100.00 Aaa 1,159,211 Obligation Bonds, Series 2003, 5.000%, 12/01/22 - MBIA Insured 2,000 Lakota Local School District, Butler County, Ohio, Unlimited 6/11 at 100.00 Aaa 2,007,540 Tax General Obligation School Improvement and Refunding Bonds, Series 2001, 5.125%, 12/01/26 - FGIC Insured 1,750 London City School District, Ohio, General Obligation 12/11 at 100.00 Aaa 1,715,980 School Facilities Construction and Improvement Bonds, Series 2001, 5.000%, 12/01/29 - FGIC Insured 2,500 Louisville City School District, Ohio, General Obligation 12/11 at 100.00 Aaa 2,454,925 Bonds, Series 2001, 5.000%, 12/01/29 - FGIC Insured 1,515 Massillon City School District, Ohio, General Obligation 12/12 at 100.00 Aaa 1,554,799 Bonds, Series 2003, 5.250%, 12/01/21 - MBIA Insured 2,335 Milford Exempted Village School District, Ohio, General 12/11 at 100.00 Aaa 2,336,401 Obligation Bonds, Series 2001, 5.125%, 12/01/30 - FSA Insured 1,260 Morgan Local School District, Morgan, Muskingum and 12/10 at 101.00 AA- 1,359,817 Washington Counties, Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 2000, 5.750%, 12/01/22 North Canton City School District, Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 1994: 650 9.750%, 12/01/03 - AMBAC Insured No Opt. Call AAA 668,610 715 9.700%, 12/01/04 - AMBAC Insured No Opt. Call AAA 795,380 Oak Hills Local School District, Hamilton County, Ohio, General Obligation Bonds, Series 1997B: 1,025 6.900%, 12/01/11 - MBIA Insured No Opt. Call AAA 1,241,101 1,090 6.900%, 12/01/12 - MBIA Insured No Opt. Call AAA 1,328,416 1,315 Ohio State Higher Education, General Obligation Bonds, 5/13 at 100.00 AA+ 1,307,557 Series 2003A, 5.000%, 5/01/23 2,720 Pickerington Local School District, Fairfield and Franklin 12/11 at 100.00 AAA 2,672,645 Counties, Ohio, School Facilities Construction and Improvement General Obligation Bonds, Series 2001, 5.000%, 12/01/28 - FGIC Insured 1,100 Plain Local School District, Franklin and Licking Counties, 6/12 at 100.00 Aaa 1,183,116 Ohio, General Obligation Bonds, Series 2002, 5.500%, 12/01/17 - FGIC Insured 280 Plain Local School District, Franklin and Licking Counties, 6/11 at 100.00 Aaa 308,790 Ohio, General Obligation Bonds, Series 2000, 6.000%, 12/01/20 - FGIC Insured 1,445 Portage County, Ohio, General Obligation Bonds, 12/11 at 100.00 AAA 1,424,293 Series 2001, 5.000%, 12/01/27 - FGIC Insured 1,000 Revere Local School District, Ohio, Unlimited Tax General 12/03 at 102.00 AAA 1,033,120 Obligation School Improvement Bonds, Series 1993, 6.000%, 12/01/16 - AMBAC Insured 2,830 Springfield Township, Hamilton County, Ohio, Various 12/11 at 100.00 Aa3 2,857,734 Purpose Limited Tax General Obligation Bonds, Series 2002, 5.250%, 12/01/27 2,000 Strongsville, Ohio, General Obligation Bonds, 12/11 at 100.00 Aaa 2,005,940 Series 2001, 5.000%, 12/01/21 - FGIC Insured 70 Strongsville, Ohio, Limited Tax General Obligation Various 12/06 at 102.00 Aa2 76,196 Purpose Improvement Bonds, Series 1996, 5.950%, 12/01/21 1,000 Upper Arlington City School District, Ohio, General 12/06 at 101.00 AAA 1,010,720 Obligation Improvement Bonds, Series 1996, 5.250%, 12/01/22 - MBIA Insured 2,000 Westerville City School District, Franklin and Delaware 6/11 at 100.00 AAA 1,971,340 Counties, Ohio, Various Purpose General Obligation Bonds, Series 2001, 5.000%, 12/01/27 - MBIA Insured 1,000 Westlake, Ohio, Various Purpose General Obligation 12/08 at 101.00 Aaa 1,082,320 Improvement and Refunding Bonds, Series 1997, 5.550%, 12/01/17 29 Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 2.5% $ 1,250 Columbus, Ohio, Tax Increment Financing Bonds, Easton 6/09 at 101.00 AAA $ 1,214,388 Project, Series 1999, 4.875%, 12/01/24 - AMBAC 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 AAA 1,080,360 1,000 5.500%, 10/01/17 - AMBAC Insured 4/12 at 100.00 AAA 1,070,670 545 Ohio Department of Transportation, Certificates of 10/03 at 100.00 AA 545,529 Participation, Rickenbacker International Airport Improvements, Series 1996, 6.125%, 4/15/15 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 8.4% Cleveland, Ohio, Airport System Revenue Bonds, Series 2000A: 1,780 5.250%, 1/01/16 - FSA Insured 1/10 at 101.00 AAA 1,849,669 2,500 5.000%, 1/01/31 - FSA Insured 1/10 at 101.00 AAA 2,439,750 3,430 Cleveland, Ohio, Parking Facilities Revenue Refunding Bonds, 9/06 at 102.00 AAA 3,535,644 Series 1996, 5.500%, 9/15/22 - MBIA Insured Columbus Municipal Airport Authority, Ohio, Airport Improvement Revenue Bonds, Port Columbus International Airport Project, Series 1994A: 830 5.950%, 1/01/08 (Alternative Minimum Tax) - MBIA Insured 1/04 at 102.00 AAA 859,938 1,000 6.000%, 1/01/14 (Alternative Minimum Tax) - MBIA Insured 1/04 at 102.00 AAA 1,035,420 1,500 Dayton, Ohio, Special Facilities Revenue Refunding Bonds, 2/08 at 102.00 BB+ 1,129,080 Emery Air Freight Corporation and Emery Worldwide Airlines, Inc. - Guarantors, Series 1998A, 5.625%, 2/01/18 2,000 Ohio Turnpike Commission, Revenue Bonds, No Opt. Call AAA 2,194,840 Series 1998A, 5.500%, 2/15/18 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 28.7% Berea City School District, Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 1993: 380 7.500%, 12/15/06 (Pre-refunded to 12/15/03) - AMBAC Insured 12/03 at 102.00 AAA 396,845 680 7.450%, 12/15/07 (Pre-refunded to 12/15/03) - AMBAC Insured 12/03 at 102.00 AAA 709,995 2,550 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 7/10 at 100.00 AAA 2,839,221 Asset-Backed Bonds, Series 2000, 5.750%, 7/01/20 (Pre-refunded to 7/01/10) 2,000 Cleveland, Ohio, Public Power System First Mortgage 11/04 at 102.00 AAA 2,191,920 Revenue Bonds, Series 1994A, 7.000%, 11/15/24 (Pre-refunded to 11/15/04) - MBIA Insured 3,960 Cleveland, Ohio, Waterworks First Mortgage Revenue 1/06 at 102.00 AAA 4,402,570 Refunding and Improvement Bonds, Series 1996H, 5.750%, 1/01/26 (Pre-refunded to 1/01/06) - MBIA Insured 1,980 Franklin County, Ohio, First Mortgage Revenue, OCLC, 12/03 at 103.00 AAA 2,279,317 Inc. Project, Series 1979, 7.500%, 6/01/09 1,505 Greater Cleveland Regional Transit Authority, General 12/06 at 101.00 Aaa 1,695,383 Obligation Capital Improvement Bonds, Series 1996, 5.650%, 12/01/16 (Pre-refunded to 12/01/06) - FGIC Insured 2,100 Lakota Local School District, Butler County, Ohio, Unlimited 12/05 at 100.00 AAA 2,327,892 Tax General Obligation School Improvement Bonds, Series 1994, 6.250%, 12/01/14 (Pre-refunded to 12/01/05) - AMBAC Insured 1,000 Newark, Ohio, Limited Tax General Obligation Water System 12/03 at 102.00 AAA 1,036,840 Improvement Bonds, Series 1993, 6.000%, 12/01/18 (Pre-refunded to 12/01/03) - AMBAC Insured 4,315 Ohio Capital Corporation for Housing, FHA-Insured 2/09 at 102.00 Aa2*** 4,975,670 Section 8 Mortgage Loan Revenue Refunding Bonds, Series 1999G, 5.950%, 2/01/24 (Pre-refunded to 2/01/09) 3,000 Ohio State Building Authority, State Facilities Bonds, 10/03 at 102.00 AA*** 3,085,830 Adult Correctional Building Fund Projects, Series 1993A, 6.125%, 10/01/12 (Pre-refunded to 10/01/03) 2,400 Ohio Higher Education Facilities Commission, Revenue 12/03 at 102.00 AAA 2,493,192 Bonds, University of Dayton Project, Series 1992, 6.600%, 12/01/17 (Pre-refunded to 12/01/03) - FGIC Insured 1,000 Ohio Water Development Authority, Fresh Water 6/05 at 102.00 AAA 1,100,660 Development Revenue Bonds, Series 1995, 5.900%, 12/01/21 (Pre-refunded to 6/01/05) - AMBAC Insured 30 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (continued) $ 1,220 Plain Local School District, Franklin and Licking Counties, 6/11 at 100.00 Aaa $ 1,406,099 Ohio, General Obligation Bonds, Series 2000, 6.000%, 12/01/20 (Pre-refunded to 6/01/11) - FGIC Insured 2,000 Puerto Rico Public Improvement, General Obligation Bonds, 7/06 at 101.50 A-*** 2,228,180 Series 1996, 5.400%, 7/01/25 (Pre-refunded to 7/01/06) 1,300 Puerto Rico Public Improvement, General Obligation Refunding 7/07 at 101.50 A-*** 1,476,722 Bonds, Series 1997, 5.750%, 7/01/17 (Pre-refunded to 7/01/07) 2,800 Strongsville, Ohio, Limited Tax General Obligation Various 12/06 at 102.00 Aa2*** 3,206,364 Purpose Improvement Bonds, Series 1996, 5.950%, 12/01/21 (Pre-refunded to 12/01/06) 1,000 Sylvania City School District, Ohio, Unlimited Tax General 12/05 at 101.00 AAA 1,107,890 Obligation Bonds, Series 1995, 5.800%, 12/01/15 (Pre-refunded to 12/01/05) - FGIC Insured 2,000 Wayne Local School District, Warren County, Ohio, 12/06 at 101.00 AAA 2,283,960 Unlimited Tax General Obligation School Improvement Bonds, Series 1996, 6.100%, 12/01/24 (Pre-refunded to 12/01/06) - AMBAC Insured 3,000 West Clermont Local School District, Clermont County, 12/05 at 100.00 AAA 3,307,680 Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 1995, 6.000%, 12/01/18 (Pre-refunded to 12/01/05) - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 9.8% 4,000 Wadsworth, Ohio, Electric System Improvement Revenue 2/12 at 100.00 Aaa 4,001,280 Bonds, American Municipal Power Ohio, Inc., Series 2002, 5.000%, 2/15/22 - MBIA Insured Ohio Air Quality Development Authority, Revenue Refunding Bonds, JMG Funding Limited Partnership Project, Series 1994: 2,000 6.375%, 1/01/29 (Alternative Minimum Tax) - AMBAC Insured 10/04 at 102.00 AAA 2,136,760 4,000 6.375%, 4/01/29 (Alternative Minimum Tax) - AMBAC Insured 10/04 at 102.00 AAA 4,273,520 3,000 Ohio Air Quality Development Authority, Revenue Bonds, 4/07 at 102.00 AAA 3,042,540 JMG Funding Limited Partnership Project, Series 1997, 5.625%, 1/01/23 (Alternative Minimum Tax) - AMBAC Insured 2,000 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 1,831,580 Revenue Bonds, Bay Shore Power Project, Series 1998A, 5.875%, 9/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 14.1% Cincinnati, Ohio, Water System Revenue Bonds, Series 2001: 1,000 5.500%, 12/01/17 6/11 at 100.00 AA+ 1,072,160 6,010 5.000%, 12/01/18 6/11 at 100.00 AA+ 6,138,494 3,000 5.000%, 12/01/19 6/11 at 100.00 AA+ 3,046,440 1,000 5.000%, 12/01/20 6/11 at 100.00 AA+ 1,009,610 2,000 Cincinnati, Ohio, Water System Revenue Bonds, 6/11 at 100.00 AA+ 1,996,180 Series 2003, 5.000%, 12/01/22 1,000 Cleveland, Ohio, Waterworks First Mortgage Revenue No Opt. Call AAA 1,075,190 Refunding and Improvement Bonds, Series 1993G, 5.500%, 1/01/21 - MBIA Insured 1,000 Cleveland, Ohio, Waterworks Revenue Refunding and 1/08 at 101.00 AAA 981,290 Improvement Bonds, Series 1998I, 5.000%, 1/01/28 - FSA Insured 40 Cleveland, Ohio, Waterworks First Mortgage Revenue 1/06 at 102.00 AAA 42,199 Refunding and Improvement Bonds, Series 1996H, 5.750%, 1/01/26 - MBIA Insured 2,110 Hamilton County, Ohio, Sewer System Improvement Revenue 6/10 at 101.00 AAA 2,230,414 Bonds, Metropolitan Sewer District of Greater Cincinnati, Series 2000A, 5.750%, 12/01/25 - MBIA Insured 31 Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER (continued) $ 2,000 Northeast Ohio Regional Sewer District, Wastewater 11/05 at 101.00 AAA $ 2,160,560 Improvement Revenue Refunding Bonds, Series 1995, 5.600%, 11/15/16 - AMBAC Insured 2,000 Southwest Regional Ohio Water District , Waterworks 12/05 at 101.00 AAA 2,174,120 System Revenue Bonds, Series 1995, 6.000%, 12/01/20 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ $ 219,555 Total Long-Term Investments (cost $218,993,566) - 146.2% 227,183,017 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 0.6% 1,000 University of Toledo, Ohio, General Receipts Variable Rate A-1+ 1,000,000 Demand Obligations, Series 0.900%, 6/01/32 - FGIC Insured+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 1,000 Total Short-Term Investments (cost $1,000,000) 1,000,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $219,993,566) - 146.8% 228,183,017 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.7% 4,228,688 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (49.5)% (77,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $155,411,705 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 32
Nuveen Ohio Dividend Advantage Municipal Fund (NXI) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 3.0% $ 2,160 Puerto Rico, The Children's Trust Fund, Tobacco 5/12 at 100.00 A- $ 1,873,217 Settlement Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 22.3% 1,000 Ohio Higher Education Facilities Commission, Revenue 12/10 at 101.00 AAA 1,026,800 Bonds, University of Dayton Project, Series 2000, 5.500%, 12/01/25 - AMBAC Insured 2,000 Ohio Higher Education Facilities Commission, Revenue 11/11 at 101.00 AA 2,016,640 Bonds, Denison University Project, Series 2001, 5.200%, 11/01/26 2,650 Ohio Higher Education Facilities Commission, Revenue 5/12 at 100.00 A2 2,575,959 Bonds, Ohio Northern University Project, Series 2002, 5.000%, 5/01/22 3,150 Student Loan Funding Corporation, Cincinnati, Ohio, 1/04 at 100.00 A 3,157,056 Student Loan Subordinated Revenue Refunding Bonds, Series 1992D, 6.600%, 7/01/05 (Alternative Minimum Tax) 2,000 University of Cincinnati, Ohio, General Receipts Bonds, 6/11 at 101.00 AAA 2,189,260 Series 2001A, 5.750%, 6/01/17 - FGIC Insured 2,735 University of Cincinnati, Ohio, General Receipts Bonds, 6/12 at 100.00 AA- 2,855,969 Series 2002F, 5.375%, 6/01/19 - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 22.1% 1,300 Akron, Bath and Copley Joint Township Hospital District, 11/03 at 102.00 Baa1 1,259,505 Ohio, Hospital Facilities Revenue Bonds, Summa Health System Project, Series 1993A, 5.500%, 11/15/13 1,100 Cuyahoga County, Ohio, Revenue Refunding Bonds, 7/13 at 100.00 A1 1,134,342 Cleveland Clinic Health System, Series 2003A, 6.000%, 1/01/32 1,950 Lucas County, Ohio, Hospital Revenue Bonds, ProMedica 11/09 at 101.00 AAA 1,967,355 Healthcare Obligated Group, Series 1999, 5.375%, 11/15/29 - AMBAC Insured 2,500 Miami County, Ohio, Hospital Facilities Revenue Refunding 5/06 at 102.00 BBB+ 2,527,375 and Improvement Bonds, Upper Valley Medical Center, Series 1996A, 6.375%, 5/15/26 Parma Community General Hospital Association, Ohio, Hospital Revenue Refunding and Improvement Bonds, Series 1998: 2,250 5.250%, 11/01/13 11/08 at 101.00 A- 2,303,595 2,000 5.375%, 11/01/29 11/08 at 101.00 A- 1,925,020 1,000 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 1,039,360 Improvement Bonds, MedCentral Health System Obligated Group, Series 2000B, 6.375%, 11/15/30 1,500 Tuscarawas County, Ohio, Hospital Facilities Revenue 10/03 at 102.00 Baa1 1,514,205 Bonds, Union Hospital Project, Series 1993A, 6.500%, 10/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 7.6% 1,790 Lucas Northgate Housing Development Corporation, 1/04 at 102.00 Aaa 1,815,848 Ohio, FHA-Insured Mortgage Revenue Refunding Bonds, Northgate Apartments Section 8 Assisted Project, Series 1999A, 5.950%, 7/01/19 - MBIA Insured 2,885 Ohio Housing Finance Agency, FHA-Insured Mortgage 4/11 at 102.00 Aa2 2,911,311 Revenue Bonds, Asbury Woods Project, Series 2001A, 5.450%, 4/01/26 - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 9.1% 1,720 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,773,956 Securities Program Residential Mortgage Revenue Bonds, Series 2000C, 6.050%, 3/01/32 (Alternative Minimum Tax) 1,935 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,996,262 Securities Program Residential Mortgage Revenue Bonds, Series 2000D, 5.450%, 9/01/31 (Alternative Minimum Tax) 1,460 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,526,050 Securities Program Residential Mortgage Revenue Bonds, Series 2000F, 5.625%, 9/01/16 33 Nuveen Ohio Dividend Advantage Municipal Fund (NXI) (continued) Portfolio of INVESTMENTS July 31, 2003 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY (continued) $ 365 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/12 at 100.00 Aaa $ 366,573 Securities Program Residential Mortgage Revenue Bonds, Series 2002D, 5.400%, 9/01/34 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 4.7% 1,000 Franklin County, Ohio, Healthcare Facilities Revenue Bonds, 7/11 at 101.00 BBB 1,046,300 Ohio Presbyterian Retirement Services, Series 2001A, 7.125%, 7/01/29 1,970 Hamilton County, Ohio, Healthcare Facilities Improvement 10/08 at 102.00 BBB+ 1,868,565 Revenue Bonds, Twin Towers, Series 1999A, 5.750%, 10/01/19 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 32.8% 1,000 Bay Village City School District, Ohio, Unlimited Tax General 12/10 at 100.00 Aa2 991,300 Obligation School Improvement Bonds, Series 2001, 5.000%, 12/01/25 1,000 Centerville, Ohio, Limited Tax General Obligation Bonds, 12/11 at 100.00 Aa3 1,002,620 Capital Facilities Improvement, Series 2001, 5.125%, 12/01/26 Jackson City School District, Jackson County, Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 2001: 880 5.500%, 12/01/22 - MBIA Insured 6/11 at 100.00 Aaa 928,286 935 5.500%, 12/01/23 - MBIA Insured 6/11 at 100.00 Aaa 981,292 2,000 Lakota Local School District, Butler County, Ohio, 6/11 at 100.00 Aaa 2,007,540 Unlimited Tax General Obligation School Improvement and Refunding Bonds, Series 2001, 5.125%, 12/01/26 - FGIC Insured 2,000 Medina City School District, Medina County, Ohio, Unlimited 12/09 at 100.00 AAA 2,012,700 Tax General Obligation School Building Construction Bonds, Series 1999, 5.250%, 12/01/28 - FGIC Insured 1,000 Nordonia Hills City School District, Ohio, School Improvement 12/10 at 101.00 AAA 1,025,660 Bonds, Series 2000, 5.450%, 12/01/25 - AMBAC Insured 1,850 Swanton Local School District, Fulton County, Ohio, General 12/11 at 101.00 AAA 1,877,824 Obligation Bonds, Series 2001, 5.250%, 12/01/25 - FGIC Insured 1,275 Sycamore Community School District, Hamilton County, 12/09 at 101.00 AAA 1,267,669 Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 1999, 5.000%, 12/01/23 - MBIA Insured 1,485 West Chester Township, Butler County, Ohio, Various 11/11 at 101.00 Aaa 1,601,365 Purpose Limited Tax General Obligation Refunding Bonds, Series 2001, 5.500%, 12/01/17 - AMBAC Insured 1,000 West Holmes Local School District, Ohio, School Improvement 6/07 at 101.00 AAA 1,020,220 Bonds, Series 1997, 5.375%, 12/01/23 - MBIA Insured 2,500 Westerville City School District, Franklin and Delaware 6/11 at 100.00 AAA 2,464,175 Counties, Ohio, Various Purpose General Obligation Bonds, Series 2001, 5.000%, 12/01/27 - MBIA Insured 2,965 Franklin County, Worthington, Ohio, Various Purpose 12/11 at 100.00 AA+ 3,054,069 Unlimited Tax General Obligation Bonds, Series 2001, 5.375%, 12/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 13.1% 2,000 State of Ohio, Higher Education Capital Facilities 2/11 at 100.00 AA+ 2,031,240 Appropriation Bonds, Series 2001A-II, 5.000%, 2/01/20 4,000 Puerto Rico Municipal Finance Agency, Loan Pool Bonds, 8/09 at 101.00 AAA 4,539,720 Series 1999A, 6.000%, 8/01/16 - FSA Insured 1,400 Virgin Islands Public Finance Authority, Gross Receipts Tax 10/10 at 101.00 BBB- 1,558,886 Loan Note, Series 1999A, 6.375%, 10/01/19 - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 7.2% 2,000 Cleveland, Ohio, Airport Special Revenue Refunding Bonds, 12/09 at 101.00 B- 1,379,040 Continental Airlines, Inc., Series 1999, 5.700%, 12/01/19 (Alternative Minimum Tax) 2,000 Ohio Turnpike Commission, Revenue Bonds, 2/11 at 100.00 AA 2,047,000 Series 2001A, 5.500%, 2/15/26 1,000 Toledo-Lucas County Port Authority, Ohio, Revenue Refunding No Opt. Call Baa2 1,059,940 Bonds, CSX Transportation, Inc. Project, Series 1992, 6.450%, 12/15/21 34 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 17.8% $ 1,440 Wadsworth, Ohio, Electric System Improvement Revenue 2/12 at 100.00 Aaa $ 1,509,077 Bonds, American Municipal Power Ohio, Inc., Series 2002, 5.250%, 2/15/17 - MBIA Insured 910 Lebanon, Ohio, Electric System Mortgage Revenue Bonds, 12/10 at 101.00 AAA 969,605 Series 2001, 5.500%, 12/01/18 - AMBAC Insured 2,000 Ohio Air Quality Development Authority, Pollution Control 12/03 at 102.00 A3 2,029,120 Revenue Bonds, Columbus Southern Power Company Project, Series 1985A, 6.250%, 12/01/20 2,000 Ohio Air Quality Development Authority, Revenue 9/05 at 102.00 Baa2 2,046,900 Refunding Bonds, Dayton Power and Light Company Project, Series 1995, 6.100%, 9/01/30 2,000 Ohio Air Quality Development Authority, Revenue Refunding 5/09 at 101.00 AAA 2,004,280 Bonds, Ohio Power Company Project, Series 1999C, 5.150%, 5/01/26 - AMBAC Insured 1,500 Ohio Air Quality Development Authority, Pollution Control 12/04 at 100.00 Baa2 1,560,540 Revenue Refunding Bonds, Ohio Edison Company Project, Series 1999C, 5.800%, 6/01/16 (Mandatory put 12/01/04) 1,000 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 915,790 Revenue Bonds, Bay Shore Power Project, Series 1998A, 5.875%, 9/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 6.3% 2,000 Akron, Ohio, Sanitary Sewer System Revenue Refunding 12/06 at 101.00 AAA 2,166,100 Bonds, Series 1997, 5.550%, 12/01/16 - MBIA Insured 1,700 Cincinnati, Ohio, Water System Revenue Bonds, 6/11 at 100.00 AA+ 1,721,215 Series 2001, 5.125%, 12/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ $ 89,260 Total Long-Term Investments (cost $89,227,588) - 146.0% 90,443,696 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 2.3% 400 Ohio Higher Education Facilities Authority, General Revenue A-1+ 400,000 Bonds, Case Western Reserve Project, Variable Rate Demand Obligations, Series 2002A, 0.900%, 10/01/31+ 1,000 University of Toledo, Ohio, General Receipts Variable Rate A-1+ 1,000,000 Demand Obligations, Series 0.900%, 6/01/32 - FGIC Insured+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 1,400 Total Short-Term Investments (cost $1,400,000) 1,400,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $90,627,588) - 148.3% 91,843,696 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.8% 1,079,890 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (50.1)% (31,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $61,923,586 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. N/R Investment is not rated. + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 35
Nuveen Ohio Dividend Advantage Municipal Fund 2 (NBJ) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 10.9% $ 2,160 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 A- $ 1,873,217 Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 3,000 Ohio State Sewage and Solid Waste Disposal Facilities, 11/11 at 100.00 A+ 2,971,980 Revenue Bonds, Anheuser-Busch Project, Series 2001, 5.500%, 11/01/35 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 4.8% 2,050 Ohio Higher Education Facilities Commission, Revenue 12/11 at 100.00 Baa1 2,132,472 Bonds, Wittenberg University Project, Series 2001, 5.500%, 12/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 23.7% 1,860 Akron, Bath and Copley Joint Township Hospital District, No Opt. Call Baa1 1,882,525 Ohio, Hospital Facilities Revenue Bonds, Summa Health System Project, Series 1998A, 5.000%, 11/15/08 1,000 Erie County, Ohio, Hospital Facilities Revenue Bonds, 8/12 at 101.00 A 984,330 Firelands Regional Medical Center, Series 2002A, 5.500%, 8/15/22 1,850 Lorain County, Ohio, Hospital Revenue Refunding and 10/11 at 101.00 AA- 1,847,096 Improvement Bonds, Catholic Healthcare Partners, Series 2001A, 5.400%, 10/01/21 2,000 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 2,078,720 Improvement Bonds, MedCentral Health System Obligated Group, Series 2000B, 6.375%, 11/15/30 3,670 Tuscarawas County, Ohio, Hospital Facilities Revenue Bonds, 10/11 at 101.00 AA 3,782,229 Union Hospital Project, Series 2001, 5.750%, 10/01/26 - RAAI Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 2.3% 1,000 Franklin County, Ohio, GNMA Collateralized Multifamily 5/12 at 102.00 Aaa 1,018,130 Housing Mortgage Revenue Bonds, Agler Project, Series 2002A, 5.550%, 5/20/22 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 7.0% 2,815 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/10 at 100.00 Aaa 2,829,610 Securities Program Residential Mortgage Revenue Bonds, Series 2001A, 5.500%, 9/01/34 (Alternative Minimum Tax) 305 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/12 at 100.00 Aaa 306,315 Securities Program Residential Mortgage Revenue Bonds, Series 2002D, 5.400%, 9/01/34 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 4.2% 2,000 Hamilton County, Ohio, Healthcare Facilities Improvement 10/08 at 102.00 BBB+ 1,871,800 Revenue Bonds, Twin Towers, Series 1999A, 5.800%, 10/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 50.5% 1,750 Fairfield City School District, Ohio, General Obligation 12/11 at 100.00 AAA 1,827,000 Refunding Bonds, Series 2001, 5.375%, 12/01/19 - FGIC Insured 1,000 Greater Cleveland Regional Transit Authority, Ohio, General 12/11 at 100.00 Aaa 1,012,170 Obligation Capital Improvement Bonds, Series 2001A, 5.125%, 12/01/21 - MBIA Insured 1,500 Hamilton Local School District, Franklin County, Ohio, 12/11 at 100.00 AAA 1,473,885 Unlimited Tax General Obligation School Facilities Construction and Improvement Bonds, Series 2001, 5.000%, 12/01/28 - FGIC Insured Lebanon City School District, Warren County, Ohio, General Obligation Bonds, Series 2001: 4,000 5.500%, 12/01/21 - FSA Insured 12/11 at 100.00 AAA 4,170,080 2,000 5.000%, 12/01/29 - FSA Insured 12/11 at 100.00 AAA 1,963,940 2,420 Lorain County, Ohio, Limited Tax General Obligation Justice 12/12 at 100.00 Aaa 2,547,002 Center Bonds, Series 2002, 5.500%, 12/01/22 - FGIC Insured 1,000 Medina City School District, Medina County, Ohio, Unlimited 12/09 at 100.00 AAA 1,006,350 Tax General Obligation School Building Construction Bonds, Series 1999, 5.250%, 12/01/28 - FGIC Insured 36 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 3,000 Milford Exempted Village School District, Ohio, General 12/11 at 100.00 Aaa $ 3,001,800 Obligation Bonds, Series 2001, 5.125%, 12/01/30 - FSA Insured 1,000 State of Ohio, Common Schools Capital Facilities, General 9/11 at 100.00 AA+ 1,011,260 Obligation Bonds, Series 2001B, 5.000%, 9/15/21 1,960 Portage County, Ohio, General Obligation Bonds, Series 2001, 12/11 at 100.00 AAA 1,942,948 5.000%, 12/01/25 - FGIC Insured 1,000 Powell, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 AAA 1,045,580 5.500%, 12/01/25 - FGIC Insured 1,500 Strongsville, Ohio, General Obligation Bonds, Series 2001, 12/11 at 100.00 Aaa 1,504,455 5.000%, 12/01/21 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 16.8% 1,700 Hamilton, Butler County, Ohio, Limited Tax General Obligation 11/11 at 101.00 Aaa 1,680,297 Bonds, One Renaissance Center Acquisition, Series 2001, 5.000%, 11/01/26 - AMBAC Insured 1,000 Midview Local School District, Lorain County, Ohio, 5/13 at 100.00 A 927,740 Certificates of Participation, Series 2003, 5.000%, 11/01/30 2,500 Ohio State Higher Education Capital Facilities, Appropriation No Opt. Call AAA 2,821,050 Bonds, Series 2002A-II, 5.500%, 12/01/09 - MBIA Insured 1,000 Puerto Rico Highway and Transportation Authority, Highway 7/12 at 100.00 A 1,046,420 Revenue Refunding Bonds, Series 2002E, 5.750%, 7/01/24 1,000 Summit County Port Authority, Ohio, Revenue Bonds, Civic 12/11 at 100.00 AAA 1,025,440 Theatre Project, Series 2001, 5.500%, 12/01/26 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 8.1% 3,495 Cleveland, Ohio, Airport System Revenue Bonds, 1/10 at 101.00 AAA 3,589,819 Series 2000A, 5.250%, 1/01/18 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 13.2% 2,500 Ohio Air Quality Development Authority, Revenue Refunding 5/09 at 101.00 AAA 2,505,350 Bonds, Ohio Power Company Project, Series 1999C, 5.150%, 5/01/26 - AMBAC Insured 1,500 Ohio Air Quality Development Authority, Pollution Control 12/04 at 100.00 Baa2 1,560,540 Revenue Refunding Bonds, Ohio Edison Company Project, Series 1999C, 5.800%, 6/01/16 (Mandatory put 12/01/04) 2,000 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 1,831,580 Revenue Bonds, Bay Shore Power Project, Series 1998A, 5.875%, 9/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 8.2% 2,000 Akron, Ohio, Sanitary Sewer System Revenue Refunding 12/06 at 101.00 AAA 2,166,100 Bonds, Series 1997, 5.550%, 12/01/16 - MBIA Insured 1,500 Ohio Water Development Authority, Fresh Water Development 12/11 at 100.00 AAA 1,507,002 Revenue Bonds, Series 2001A, 5.000%, 12/01/21 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ $ 66,035 Total Long-Term Investments (cost $66,714,279) - 149.7% 66,746,232 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 4.1% 1,831,406 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (53.8)% (24,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $44,577,638 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. N/R Investment is not rated. See accompanying notes to financial statements. 37
Nuveen Ohio Dividend Advantage Municipal Fund 3 (NVJ) Portfolio of INVESTMENTS July 31, 2003
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 6.0% $ 2,160 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 A- $ 1,873,217 Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 17.2% 1,125 Ohio Higher Education Facilities Commission, Revenue Bonds, 5/12 at 100.00 A2 1,205,933 Ohio Northern University Project, Series 2002, 5.750%, 5/01/16 2,000 Ohio Higher Education Facilities Commission, Revenue Bonds, 10/12 at 100.00 AA 2,103,460 Case Western Reserve University Project, Series 2002B, 5.500%, 10/01/22 1,000 Ohio State University, General Receipts Bonds, 12/09 at 101.00 AA 1,062,740 Series 1999A, 5.800%, 12/01/29 1,000 Ohio State University, General Receipts Bonds, 12/12 at 100.00 AA 998,440 Series 2002A, 5.125%, 12/01/31 - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 23.2% 930 Akron, Bath and Copley Joint Township Hospital District, No Opt. Call Baa1 941,262 Ohio, Hospital Facilities Revenue Bonds, Summa Health System Project, Series 1998A, 5.000%, 11/15/08 1,750 Erie County, Ohio, Hospital Facilities Revenue Bonds, 8/12 at 101.00 A 1,722,578 Firelands Regional Medical Center, Series 2002A, 5.500%, 8/15/22 1,425 Montgomery County, Ohio, Hospital Facilities Revenue Bonds, 4/10 at 101.00 BBB+ 1,513,835 Kettering Medical Center, Series 1999, 6.750%, 4/01/18 1,000 Montgomery County, Ohio, Revenue Bonds, Catholic 9/11 at 100.00 AA 1,067,450 Health Initiatives, Series 2001, 5.500%, 9/01/12 1,000 Parma Community General Hospital Association, Ohio, Hospital 11/08 at 101.00 A- 962,510 Revenue Refunding and Improvement Bonds, Series 1998, 5.375%, 11/01/29 1,000 Richland County, Ohio, Hospital Facilities Revenue 11/10 at 101.00 A- 1,039,360 Improvement Bonds, MedCentral Health System Obligated Group, Series 2000B, 6.375%, 11/15/30 - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 11.4% 835 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 861,194 Securities Program Residential Mortgage Revenue Bonds, Series 2000C, 6.050%, 3/01/32 (Alternative Minimum Tax) 1,185 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,222,517 Securities Program Residential Mortgage Revenue Bonds, Series 2000D, 5.450%, 9/01/31 (Alternative Minimum Tax) 1,410 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,473,788 Securities Program Residential Mortgage Revenue Bonds, Series 2000F, 5.625%, 9/01/16 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 41.5% 2,000 Canal Winchester Local School District, Franklin and 12/08 at 102.00 AAA 2,025,300 Fairfield Counties, Ohio, Unlimited Tax General Obligation School Improvement Bonds, Series 1998, 5.300%, 12/01/25 - FGIC Insured 1,475 Eaton City School District, Preble County, Ohio, General 12/12 at 101.00 Aaa 1,607,971 Obligation Bonds, Series 2002, 5.750%, 12/01/21 - FGIC Insured 2,000 Granville Exempt Village School District, Ohio, General 12/11 at 100.00 Aa3 2,061,420 Obligation Bonds, Series 2001, 5.500%, 12/01/28 1,000 Hilliard, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 AA- 1,036,310 5.375%, 12/01/22 1,270 Lorain, Ohio, General Obligation Bonds, Series 2002, 12/12 at 100.00 Aaa 1,278,344 5.125%, 12/01/26 - AMBAC Insured 1,190 Miami East Local School District, Miami County, Ohio, 12/12 at 100.00 AAA 1,196,938 General Obligation Bonds, Series 2002, 5.125%, 12/01/29 - FSA Insured 1,000 State of Ohio, Common Schools Capital Facilities, General 9/11 at 100.00 AA+ 1,016,630 Obligation Bonds, Series 2001B, 5.000%, 9/15/20 38 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 1,535 Pickerington Local School District, Fairfield and Franklin 12/11 at 100.00 AAA $ 1,576,568 Counties, Ohio, School Facilities Construction and Improvement General Obligation Bonds, Series 2001, 5.250%, 12/01/20 - FGIC Insured 1,130 Solon, Ohio, General Obligation Refunding and Improvement 12/12 at 100.00 AA+ 1,158,307 Bonds, Series 2002, 5.000%, 12/01/18 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 21.4% 1,000 Midview Local School District, Lorain County, Ohio, 5/13 at 100.00 A 927,740 Certificates of Participation, Series 2003, 5.000%, 11/01/30 2,000 Ohio State Higher Education, Capital Facilities Appropriation No Opt. Call AAA 2,256,840 Bonds, Series 2002A-II, 5.500%, 12/01/09 - MBIA Insured 1,250 Ohio State Building Authority, State Facilities Bonds, 4/12 at 100.00 AAA 1,333,725 Administrative Building Fund Projects, Series 2002A, 5.500%, 4/01/18 - FSA Insured 2,000 Puerto Rico Public Buildings Authority, Guaranteed No Opt. Call AAA 2,180,780 Government Facilities Revenue Bonds, Series 1993L, 5.500%, 7/01/21 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 9.3% 1,140 Columbus Municipal Airport Authority, Ohio, Airport No Opt. Call AAA 1,212,208 Improvement Revenue Bonds, Port Columbus International Airport Project, Series 1998B, 5.250%, 1/01/11 - AMBAC Insured 1,550 Ohio Turnpike Commission, Revenue Bonds, Series 1998A, No Opt. Call AAA 1,701,001 5.500%, 2/15/18 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 5.0% 1,500 Wadsworth, Ohio, Electric System Improvement Revenue 2/12 at 100.00 Aaa 1,571,955 Bonds, American Municipal Power Ohio, Inc., Series 2002, 5.250%, 2/15/17 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 13.3% 1,000 Akron, Ohio, Sanitary Sewer System Revenue Refunding 12/06 at 101.00 AAA 1,083,050 Bonds, Series 1997, 5.550%, 12/01/16 - MBIA Insured 1,500 Hamilton County, Ohio, Sewer System Revenue Refunding 12/11 at 100.00 AAA 1,559,385 and Improvement Bonds, Metropolitan Sewer District of Greater Cincinnati, Series 2001A, 5.250%, 12/01/18 - MBIA Insured 1,500 Ohio Water Development Authority, Fresh Water Development 12/11 at 100.00 AAA 1,507,003 Revenue Bonds, Series 2001A, 5.000%, 12/01/21 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ $ 44,860 Total Long-Term Investments (cost $45,873,387) - 148.3% 46,339,759 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 4.5% 1,405,427 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (52.8)% (16,500,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $31,245,186 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions (not covered by the report of independent auditors): 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. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. See accompanying notes to financial statements. 39
Statement of ASSETS AND LIABILITIES July 31, 2003
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments, at market value (cost $255,493,257, $163,801,871 and $42,898,673, respectively) $266,122,396 $170,371,984 $43,055,057 Cash 78,970 767,382 1,893,495 Receivables: Interest 3,257,167 2,471,601 538,652 Investments sold 962,304 -- -- Other assets 16,537 6,533 938 - ------------------------------------------------------------------------------------------------------------------------------------ Total assets 270,437,374 173,617,500 45,488,142 - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft -- -- -- Accrued expenses: Management fees 152,162 97,754 17,709 Other 87,784 97,306 26,698 Preferred share dividends payable 11,366 4,061 247 - ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 251,312 199,121 44,654 - ------------------------------------------------------------------------------------------------------------------------------------ Preferred shares, at liquidation value 94,000,000 56,000,000 16,000,000 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $176,186,062 $117,418,379 $29,443,488 ==================================================================================================================================== Common shares outstanding 11,634,006 7,705,914 2,058,760 ==================================================================================================================================== Net asset value per Common share outstanding (net assets applicable to Common shares, divided by Common shares outstanding) $ 15.14 $ 15.24 $ 14.30 ==================================================================================================================================== NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF: - ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 116,340 $ 77,059 $ 20,588 Paid-in surplus 162,629,383 107,684,852 29,132,590 Undistributed net investment income 1,925,191 1,483,435 269,088 Accumulated net realized gain (loss) from investments 886,009 1,602,920 (135,162) Net unrealized appreciation of investments 10,629,139 6,570,113 156,384 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $176,186,062 $117,418,379 $29,443,488 ==================================================================================================================================== Authorized shares: Common 200,000,000 200,000,000 Unlimited Preferred 1,000,000 1,000,000 Unlimited ==================================================================================================================================== See accompanying notes to financial statements. 40
OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments, at market value (cost $219,993,566, $90,627,588, $66,714,279 and $45,873,387, respectively) $228,183,017 $91,843,696 $66,746,232 $46,339,759 Cash 1,748,818 -- 1,087,390 817,088 Receivables: Interest 2,756,705 1,232,396 799,373 615,102 Investments sold -- -- -- -- Other assets 20,055 8,787 1,001 9,011 - ------------------------------------------------------------------------------------------------------------------------------------ Total assets 232,708,595 93,084,879 68,633,996 47,780,960 - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft -- 98,841 -- -- Accrued expenses: Management fees 130,275 30,616 24,775 19,361 Other 156,762 31,156 29,477 15,689 Preferred share dividends payable 9,853 680 2,106 724 - ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 296,890 161,293 56,358 35,774 - ------------------------------------------------------------------------------------------------------------------------------------ Preferred shares, at liquidation value 77,000,000 31,000,000 24,000,000 16,500,000 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $155,411,705 $61,923,586 $44,577,638 $31,245,186 ==================================================================================================================================== Common shares outstanding 9,612,951 4,223,803 3,114,060 2,157,265 ==================================================================================================================================== Net asset value per Common share outstanding (net assets applicable to Common shares, divided by Common shares outstanding) $ 16.17 $ 14.66 $ 14.31 $ 14.48 ==================================================================================================================================== NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF: - ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 96,130 $ 42,238 $ 31,141 $ 21,573 Paid-in surplus 145,508,219 59,930,121 44,121,226 30,523,920 Undistributed net investment income 1,508,224 658,025 425,175 76,532 Accumulated net realized gain (loss) from investments 109,681 77,094 (31,857) 156,789 Net unrealized appreciation of investments 8,189,451 1,216,108 31,953 466,372 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $155,411,705 $61,923,586 $44,577,638 $31,245,186 ==================================================================================================================================== Authorized shares: Common 200,000,000 Unlimited Unlimited Unlimited Preferred 1,000,000 Unlimited Unlimited Unlimited ==================================================================================================================================== See accompanying notes to financial statements. 41
Statement of OPERATIONS Year Ended July 31, 2003
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $14,364,958 $ 9,395,746 $2,295,399 - ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 1,785,354 1,150,800 304,722 Preferred shares - auction fees 228,077 140,035 39,419 Preferred shares - dividend disbursing agent fees 20,000 20,000 10,000 Shareholders' servicing agent fees and expenses 40,043 29,578 2,057 Custodian's fees and expenses 74,625 47,134 16,689 Directors'/Trustees' fees and expenses 3,866 2,554 818 Professional fees 15,543 12,059 10,317 Shareholders' reports - printing and mailing expenses 42,144 27,660 4,114 Stock exchange listing fees 16,198 11,510 117 Investor relations expense 33,985 22,473 2,996 Other expenses 25,995 15,650 6,067 - ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit and expense reimbursement 2,285,830 1,479,453 397,316 Custodian fee credit (11,307) (16,594) (6,858) Expense reimbursement -- -- (136,932) - ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 2,274,523 1,462,859 253,526 - ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 12,090,435 7,932,887 2,041,873 - ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS Net realized gain from investments 1,537,864 1,797,104 43,512 Change in net unrealized appreciation (depreciation) of investments (4,630,793) (4,692,253) (463,571) - ------------------------------------------------------------------------------------------------------------------------------------ Net gain (loss) from investments (3,092,929) (2,895,149) (420,059) - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS From net investment income (882,566) (551,440) (141,482) From accumulated net realized gains from investments (128,818) -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Preferred shareholders (1,011,384) (551,440) (141,482) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations $ 7,986,122 $ 4,486,298 $1,480,332 ==================================================================================================================================== See accompanying notes to financial statements. 42
OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $12,517,224 $ 4,939,671 $ 3,503,822 $2,352,278 - ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 1,526,999 616,036 458,464 320,370 Preferred shares - auction fees 192,719 88,098 59,624 40,741 Preferred shares - dividend disbursing agent fees 30,000 10,000 10,000 10,000 Shareholders' servicing agent fees and expenses 42,255 2,094 2,194 1,540 Custodian's fees and expenses 61,107 28,043 24,570 18,054 Directors'/Trustees' fees and expenses 3,481 1,609 1,018 874 Professional fees 13,091 10,227 10,113 11,230 Shareholders' reports - printing and mailing expenses 31,646 7,311 9,400 5,384 Stock exchange listing fees 11,602 482 323 115 Investor relations expense 29,812 11,059 5,672 5,021 Other expenses 18,067 9,271 10,188 6,316 - ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit and expense reimbursement 1,960,779 784,230 591,566 419,645 Custodian fee credit (11,694) (6,625) (7,282) (7,633) Expense reimbursement -- (282,087) (207,890) (143,188) - ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 1,949,085 495,518 376,394 268,824 - ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 10,568,139 4,444,153 3,127,428 2,083,454 - ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS Net realized gain from investments 742,663 156,618 393,224 305,202 Change in net unrealized appreciation (depreciation) of investments (3,005,456) (1,154,603) (1,127,584) (942,414) - ------------------------------------------------------------------------------------------------------------------------------------ Net gain (loss) from investments (2,262,793) (997,985) (734,360) (637,212) - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS From net investment income (735,656) (307,940) (236,527) (149,564) From accumulated net realized gains from investments -- (5,459) -- (15,641) - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Preferred shareholders (735,656) (313,399) (236,527) (165,205) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations $ 7,569,690 $ 3,132,769 $ 2,156,541 $1,281,037 ==================================================================================================================================== See accompanying notes to financial statements. 43
Statement of CHANGES IN NET ASSETS
MICHIGAN MICHIGAN MICHIGAN QUALITY INCOME (NUM) PREMIUM INCOME (NMP) DIVIDEND ADVANTAGE (NZW) ----------------------------- ------------------------------ ---------------------------- FOR THE PERIOD 9/25/01 (COMMENCEMENT YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED OF OPERATIONS) 7/31/03 7/31/02 7/31/03 7/31/02 7/31/03 THROUGH 7/31/02 - ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 12,090,435 $ 12,842,247 $ 7,932,887 $ 8,069,853 $ 2,041,873 $ 1,563,572 Net realized gain (loss) from investments 1,537,864 1,255,918 1,797,104 509,493 43,512 (179,018) Change in net unrealized appreciation (depreciation) of investments (4,630,793) 580,210 (4,692,253) 764,121 (463,571) 620,710 Distributions to Preferred Shareholders: From net investment income (882,566) (1,264,782) (551,440) (820,275) (141,482) (139,482) From accumulated net realized gains from investments (128,818) (279,535) -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations 7,986,122 13,134,058 4,486,298 8,523,192 1,480,332 1,865,782 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (10,738,262) (10,352,127) (6,995,623) (6,545,391) (1,770,278) (1,287,427) From accumulated net realized gains from investments (1,195,839) (863,646) -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (11,934,101) (11,215,773) (6,995,623) (6,545,391) (1,770,278) (1,287,427) - ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from sale of shares -- -- -- -- -- 29,319,045 Net proceeds from shares issued to shareholders due to reinvestment of distributions 503,555 1,048,301 108,017 57,829 3,344 7,758 Preferred shares offering costs -- -- -- -- 50,657 (326,000) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions 503,555 1,048,301 108,017 57,829 54,001 29,000,803 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (3,444,424) 2,966,586 (2,401,308) 2,035,630 (235,945) 29,579,158 Net assets applicable to Common shares at the beginning of year 179,630,486 176,663,900 119,819,687 117,784,057 29,679,433 100,275 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of year $176,186,062 $179,630,486 $117,418,379 $119,819,687 $29,443,488 $29,679,433 ==================================================================================================================================== Undistributed net investment income at the end of year $ 1,925,191 $ 1,500,913 $ 1,483,435 $ 1,187,234 $ 269,088 $ 136,663 ==================================================================================================================================== See accompanying notes to financial statements. 44
OHIO OHIO OHIO QUALITY INCOME (NUO) DIVIDEND ADVANTAGE (NXI) DIVIDEND ADVANTAGE 2 (NBJ) ------------------------------ ------------------------------ ----------------------------- FOR THE PERIOD 9/26/01 (COMMENCEMENT YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED OF OPERATIONS) 7/31/03 7/31/02 7/31/03 7/31/02 7/31/03 THROUGH 7/31/02 - ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 10,568,139 $ 10,914,004 $ 4,444,153 $ 4,448,330 $ 3,127,428 $ 2,414,558 Net realized gain (loss) from investments 742,663 1,127,600 156,618 (10,990) 393,224 (425,114) Change in net unrealized appreciation (depreciation) of investments (3,005,456) 387,460 (1,154,603) 836,808 (1,127,584) 1,158,572 Distributions to Preferred Shareholders: From net investment income (735,656) (1,205,443) (307,940) (508,862) (236,527) (237,497) From accumulated net realized gains from investments -- -- (5,459) -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations 7,569,690 11,223,621 3,132,769 4,765,286 2,156,541 2,910,519 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (9,454,399) (8,853,521) (3,865,874) (3,662,910) (2,710,843) (1,932,880) From accumulated net realized gains from investments -- -- (43,462) -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (9,454,399) (8,853,521) (3,909,336) (3,662,910) (2,710,843) (1,932,880) - ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from sale of shares -- -- -- -- -- 44,385,975 Net proceeds from shares issued to shareholders due to reinvestment of distributions 945,060 817,099 115,397 21,725 13,374 17,220 Preferred shares offering costs -- -- 36,823 -- 45,457 (408,000) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions 945,060 817,099 152,220 21,725 58,831 43,995,195 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (939,649) 3,187,199 (624,347) 1,124,101 (495,471) 44,972,834 Net assets applicable to Common shares at the beginning of year 156,351,354 153,164,155 62,547,933 61,423,832 45,073,109 100,275 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of year $155,411,705 $156,351,354 $61,923,586 $62,547,933 $44,577,638 $45,073,109 ==================================================================================================================================== Undistributed net investment income at the end of year $ 1,508,224 $ 1,162,184 $ 658,025 $ 410,424 $ 425,175 $ 244,181 ==================================================================================================================================== See accompanying notes to financial statements. 45
Statement of CHANGES IN NET ASSETS (continued)
OHIO DIVIDEND ADVANTAGE 3 (NVJ) ---------------------------- FOR THE PERIOD 3/27/02 (COMMENCEMENT YEAR ENDED OF OPERATIONS) 7/31/03 THROUGH 7/31/02 - ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 2,083,454 $ 544,899 Net realized gain (loss) from investments 305,202 (11,350) Change in net unrealized appreciation (depreciation) of investments (942,414) 1,409,668 Distributions to Preferred Shareholders: From net investment income (149,564) (41,042) From accumulated net realized gains from investments (15,641) -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations 1,281,037 1,902,175 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (1,889,785) (472,386) From accumulated net realized gains from investments (121,348) -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (2,011,133) (472,386) - ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from sale of shares -- 30,734,250 Net proceeds from shares issued to shareholders due to reinvestment of distributions 3,539 536 Preferred shares offering costs (23,189) (269,918) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions (19,650) 30,464,868 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (749,746) 31,894,657 Net assets applicable to Common shares at the beginning of year 31,994,932 100,275 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of year $31,245,186 $31,994,932 ==================================================================================================================================== Undistributed net investment income at the end of year $ 76,532 $ 31,471 ==================================================================================================================================== See accompanying notes to financial statements. 46
Notes to FINANCIAL STATEMENTS 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The state funds (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). Common shares of Michigan Quality Income (NUM), Michigan Premium Income (NMP), and Ohio Quality Income (NUO) are traded on the New York Stock Exchange 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 American Stock Exchange. The Funds are registered under the Investment Company Act of 1940, as amended, as closed-end management investment companies. Prior to the commencement of operations of Michigan Dividend Advantage (NZW), Ohio Dividend Advantage 2 (NBJ), and Ohio Dividend Advantage 3 (NVJ), each Fund had no operations other than those related to organizational matters, the initial capital contribution of $100,275 per Fund by Nuveen Advisory Corp. (the "Adviser"), a wholly owned subsidiary of Nuveen Investments, Inc.(formerly, The John Nuveen Company), and the recording of the organization expenses ($11,500 per Fund) and their reimbursement by Nuveen Investments, LLC(formerly, Nuveen Investments), also a wholly owned subsidiary of Nuveen Investments, Inc. Each Fund seeks to provide current income exempt from both regular federal and designated state income taxes by investing primarily in a diversified portfolio of municipal obligations issued by state and local government authorities within a single state. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States. Securities 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. When price quotes are not readily available (which is usually the case for municipal securities), the pricing service establishes fair market value based on yields or prices of municipal bonds of comparable quality, type of issue, coupon, maturity and rating, indications of value from securities dealers and general market conditions. If it is determined that market prices for a security are unavailable or inappropriate, the Board of Directors/Trustees of the Funds, or its designee, may establish a fair value for the security. Temporary investments in securities that have variable rate and demand features qualifying them as short-term securities are valued at amortized cost, which approximates market value. Securities Transactions Securities transactions are recorded on a trade date basis. Realized gains and losses from such transactions are determined on the specific identification method. Securities purchased or sold on a when-issued or delayed delivery basis may have extended settlement periods. The securities 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 and delayed delivery purchase commitments. At July 31, 2003, 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. 47 Notes to FINANCIAL STATEMENTS (continued) Income Taxes Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net investment income to its share holders. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions which 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. All monthly tax-exempt income dividends paid during the fiscal year ended July 31, 2003, have been designated Exempt Interest Dividends. 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 not less frequently than 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 accounting principles generally accepted in the United States. Preferred Shares The Funds have issued and outstanding $25,000 stated value Preferred shares. Each Fund's Preferred shares are issued in one or more Series. The dividend rate on each Series may change every seven days, as set pursuant to a dutch auction process by the auction agent, and is payable at or near the end of each rate period. 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 -- 840 -- Series W -- -- 640 Series TH 3,200 1,400 -- Series F 560 -- -- - -------------------------------------------------------------------------------- Total 3,760 2,240 640 ================================================================================ OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - -------------------------------------------------------------------------------- Number of shares: Series M 680 -- -- -- Series T -- -- -- 660 Series W -- 1,240 -- -- Series TH 1,400 -- -- -- Series TH2 1,000 -- -- -- Series F -- -- 960 -- - -------------------------------------------------------------------------------- Total 3,080 1,240 960 660 ================================================================================ 48 Derivative Financial Instruments The Funds may invest in certain derivative financial instruments including futures, forward, swap, and option contracts, and other financial instruments with similar characteristics. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the fiscal year ended July 31, 2003. Custodian Fee Credit Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by credits earned on each Fund's cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Offering Costs Nuveen Investments, LLC has agreed to pay all common share offering costs (other than the sales load) that exceed $.03 per Common share for Michigan Dividend Advantage (NZW), Ohio Dividend Advantage 2 (NBJ), and Ohio Dividend Advantage 3 (NVJ). Michigan Dividend Advantage's (NZW), Ohio Dividend Advantage 2's (NBJ), and Ohio Dividend Advantage 3's (NVJ) share of common share offering costs ($61,530, $93,150, and $64,500, respectively) were recorded as a reduction of the proceeds from the sale of common shares. Costs incurred by Michigan Dividend Advantage (NZW), Ohio Dividend Advantage 2 (NBJ), and Ohio Dividend Advantage 3 (NVJ) in connection with their offering of Preferred shares ($275,343, $362,543, and $293,107, respectively) were recorded as a reduction to paid-in surplus. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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. FUND SHARES Transactions in Common and Preferred shares were as follows:
MICHIGAN QUALITY MICHIGAN PREMIUM MICHIGAN DIVIDEND INCOME (NUM) INCOME (NMP) ADVANTAGE (NZW) ----------------------- ------------------------ ------------------------- FOR THE PERIOD 9/25/01 (COMMENCE- MENT OF OPERATIONS) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH 7/31/03 7/31/02 7/31/03 7/31/02 7/31/03 7/31/02 - -------------------------------------------------------------------------------------------------------------- Common shares: Shares sold -- -- -- -- -- 2,051,000 Shares issued to shareholders due to reinvestment of distributions 30,579 68,086 6,562 3,743 217 543 - -------------------------------------------------------------------------------------------------------------- 30,579 68,086 6,562 3,743 217 2,051,543 ============================================================================================================== Preferred shares sold -- -- -- -- -- 640 ============================================================================================================== OHIO QUALITY OHIO DIVIDEND OHIO DIVIDEND INCOME (NUO) ADVANTAGE (NXI) ADVANTAGE 2 (NBJ) ----------------------- ------------------------ ------------------------- FOR THE PERIOD 9/26/01 (COMMENCE- MENT OF OPERATIONS) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH 7/31/03 7/31/02 7/31/03 7/31/02 7/31/03 7/31/02 - -------------------------------------------------------------------------------------------------------------- Common shares: Shares sold -- -- -- -- -- 3,105,000 Shares issued to shareholders due to reinvestment of distributions 54,111 47,904 7,470 1,425 872 1,188 - -------------------------------------------------------------------------------------------------------------- 54,111 47,904 7,470 1,425 872 3,106,188 ============================================================================================================== Preferred shares sold -- -- -- -- -- 960 ==============================================================================================================
49 Notes to FINANCIAL STATEMENTS (continued)
OHIO DIVIDEND ADVANTAGE 3 (NVJ) -------------------------- FOR THE PERIOD 3/27/02 (COMMENCE- MENT OF OPERATIONS) YEAR ENDED THROUGH 7/31/03 7/31/02 - -------------------------------------------------------------------------------------------------------------- Common shares: Shares sold -- 2,150,000 Shares issued to shareholders due to reinvestment of distributions 230 35 - -------------------------------------------------------------------------------------------------------------- 230 2,150,035 ============================================================================================================== Preferred shares sold -- 660 ==============================================================================================================
3. SECURITIES TRANSACTIONS Purchases and sales (including maturities) of investments in long-term municipal securities during the fiscal year ended July 31, 2003, were as follows: MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - -------------------------------------------------------------------------------- Purchases $39,603,997 $30,681,435 $1,020,510 Sales and maturities 43,143,602 31,135,094 2,593,628 ================================================================================ OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - -------------------------------------------------------------------------------- Purchases $27,564,253 $5,472,997 $10,219,549 $7,774,032 Sales and maturities 30,047,977 6,549,659 10,981,480 8,460,014 ================================================================================ 50 4. 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 income on taxable market discount securities and timing differences in recognizing certain gains and losses on security transactions. At July 31, 2003, the cost of investments were as follows:
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - ----------------------------------------------------------------------------------------------------------- Cost of investments $255,523,287 $163,593,571 $42,897,408 =========================================================================================================== OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - ----------------------------------------------------------------------------------------------------------- Cost of investments $219,944,693 $90,568,004 $66,705,176 $45,869,886 ===========================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments at July 31, 2003, were as follows:
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - ---------------------------------------------------------------------------------------------------------- Gross unrealized: Appreciation $13,497,666 $ 9,319,221 $ 471,407 Depreciation (2,898,557) (2,540,808) (313,758) - ---------------------------------------------------------------------------------------------------------- Net unrealized appreciation of investments $10,599,109 $ 6,778,413 $ 157,649 ========================================================================================================== OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - ---------------------------------------------------------------------------------------------------------- Gross unrealized: Appreciation $ 9,779,844 $1,978,403 $ 541,499 $ 798,762 Depreciation (1,541,520) (702,711) (500,443) (328,889) - ---------------------------------------------------------------------------------------------------------- Net unrealized appreciation of investments $ 8,238,324 $1,275,692 $ 41,056 $ 469,873 ==========================================================================================================
The tax components of undistributed net investment income and net realized gains at July 31, 2003, were as follows:
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - ---------------------------------------------------------------------------------------------------------- Undistributed net tax-exempt income $2,666,458 $1,800,842 $421,408 Undistributed net ordinary income * 30,661 71,709 40 Undistributed net long-term capital gains 1,062,929 1,602,921 -- ========================================================================================================== OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - ---------------------------------------------------------------------------------------------------------- Undistributed net tax-exempt income $2,254,018 $930,678 $650,895 $231,236 Undistributed net ordinary income * 17,867 1,707 838 156,789 Undistributed net long-term capital gains 109,681 75,401 -- -- ==========================================================================================================
* Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. 51 Notes to FINANCIAL STATEMENTS (continued) The tax character of distributions paid during the fiscal years ended July 31, 2003, and July 31, 2002, was designated for purposes of the dividends paid deduction as follows:
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE 2003 (NUM) (NMP) (NZW) - --------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $11,597,039 $7,524,815 $1,902,369 Distributions from net ordinary income * -- -- -- Distributions from net long-term capital gains 1,324,657 -- -- ========================================================================================================= OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - --------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $10,147,481 $4,155,416 $2,926,588 $2,038,899 Distributions from net ordinary income * -- -- -- 137,104 Distributions from net long-term capital gains -- 48,921 -- -- =========================================================================================================
MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE 2002 (NUM) (NMP) (NZW) - --------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $11,598,566 $7,324,052 $1,280,774 Distributions from net ordinary income * -- -- -- Distributions from net long-term capital gains 1,143,181 -- -- ========================================================================================================= OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - --------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $10,020,828 $4,172,472 $1,953,596 $355,558 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. 52 At July 31, 2003, 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 OHIO DIVIDEND DIVIDEND ADVANTAGE ADVANTAGE 2 (NZW) (NBJ) - -------------------------------------------------------------------------------- Expiration year: 2011 $135,162 $21,436 - -------------------------------------------------------------------------------- Total $135,162 $21,436 ================================================================================ Ohio Dividend Advantage 2 (NBJ) has elected to defer net realized losses from investments incurred from November 1, 2002 through July 31, 2003 ("post-October losses") in accordance with Federal income tax regulations. Ohio Dividend Advantage 2 (NBJ) has $10,421 of post-October losses that are treated as having arisen in the following fiscal year. 5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES Under Michigan Quality Income's (NUM), Michigan Premium Income's (NMP), and Ohio Quality Income's (NUO) investment management agreements with the Adviser, each Fund pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets (including net assets attributable to Preferred shares) of each Fund as follows: AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TOPREFERRED SHARES) MANAGEMENT FEE - -------------------------------------------------------------------------------- For the first $125 million .6500% For the next $125 million .6375 For the next $250 million .6250 For the next $500 million .6125 For the next $1 billion .6000 For the next $3 billion .5875 For net assets over $5 billion .5750 ================================================================================ Under Michigan Dividend Advantage's (NZW), Ohio Dividend Advantage's (NXI), Ohio Dividend Advantage 2's (NBJ), and Ohio Dividend Advantage 3's (NVJ) investment management agreements with the Adviser, each Fund pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets (including net assets attributable to Preferred shares) of each Fund as follows: AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TOPREFERRED SHARES) MANAGEMENT FEE - -------------------------------------------------------------------------------- For the first $125 million .6500% For the next $125 million .6375 For the next $250 million .6250 For the next $500 million .6125 For the next $1 billion .6000 For net assets over $2 billion .5750 ================================================================================ 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 their officers, all of whom receive remuneration for their services to the Funds from the Adviser. 53 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 (including net assets attributable to Preferred shares), 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 (including net assets attributable to Preferred shares), 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 (including net assets attributable to Preferred shares), 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. 54 6. SUBSEQUENT EVENT - DISTRIBUTIONS TO COMMON SHAREHOLDERS The Funds declared Common share dividend distributions from their tax-exempt net investment income which were paid on September 2, 2003, to shareholders of record on August 15, 2003, as follows: MICHIGAN MICHIGAN MICHIGAN QUALITY PREMIUM DIVIDEND INCOME INCOME ADVANTAGE (NUM) (NMP) (NZW) - -------------------------------------------------------------------------------- Dividend per share $.0780 $.0770 $.0745 ================================================================================ OHIO OHIO OHIO OHIO QUALITY DIVIDEND DIVIDEND DIVIDEND INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NUO) (NXI) (NBJ) (NVJ) - -------------------------------------------------------------------------------- Dividend per share $.0835 $.0785 $.0750 $.0730 ================================================================================ 55 Financial HIGHLIGHTS Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ----------------------------------------------------------------- -------------------------------- Distributions Distributions from Net from Net Beginning Net Investment Capital Investment Capital Common Realized/ Income to Gains to Income to Gains to Share Net Unrealized Preferred Preferred Common Common Net Asset Investment Investment Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total =============================================================================================================================== MICHIGAN QUALITY INCOME (NUM) - ------------------------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 $15.48 $1.04 $ (.27) $(.08) $(.01) $ .68 $(.92) $(.10) $(1.02) 2002 15.32 1.11 .15 (.11) (.02) 1.13 (.90) (.07) (.97) 2001 14.54 1.16 .82 (.29) (.01) 1.68 (.88) (.02) (.90) 2000 15.20 1.19 (.53) (.30) (.02) .34 (.92) (.08) (1.00) 1999 15.91 1.15 (.63) (.21) (.02) .29 (.92) (.06) (.98) MICHIGAN PREMIUM INCOME (NMP) - ------------------------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 15.56 1.03 (.37) (.07) -- .59 (.91) -- (.91) 2002 15.31 1.05 .16 (.11) -- 1.10 (.85) -- (.85) 2001 14.24 1.07 1.07 (.25) -- 1.89 (.82) -- (.82) 2000 14.68 1.07 (.41) (.27) -- .39 (.83) -- (.83) 1999 15.30 1.05 (.64) (.21) -- .20 (.82) -- (.82) MICHIGAN DIVIDEND ADVANTAGE (NZW) - ------------------------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 14.42 .99 (.20) (.07) -- .72 (.86) -- (.86) 2002(a) 14.33 .76 .22 (.07) -- .91 (.63) -- (.63) =============================================================================================================================== Total Returns ----------------- Based Offering on Costs and Ending Common Preferred Common Based Share Share Share Ending on Net Underwriting Net Asset Market Market Asset Discounts Value Value Value** Value** =================================================================================== MICHIGAN QUALITY INCOME (NUM) - ----------------------------------------------------------------------------------- Year Ended 7/31: 2003 $ -- $15.14 $15.4500 2.40% 4.35% 2002 -- 15.48 16.1000 11.18 7.68 2001 -- 15.32 15.4200 17.11 11.90 2000 -- 14.54 14.0000 (9.92) 2.51 1999 (.02) 15.20 16.6875 2.18 1.62 MICHIGAN PREMIUM INCOME (NMP) - ----------------------------------------------------------------------------------- Year Ended 7/31: 2003 -- 15.24 14.8500 2.64 3.71 2002 -- 15.56 15.3500 10.52 7.40 2001 -- 15.31 14.7100 17.81 13.61 2000 -- 14.24 13.2500 (6.16) 2.95 1999 -- 14.68 15.0625 5.95 1.23 MICHIGAN DIVIDEND ADVANTAGE (NZW) - ----------------------------------------------------------------------------------- Year Ended 7/31: 2003 .02 14.30 15.1000 9.19 5.01 2002(a) (.19) 14.42 14.6500 2.00 5.21 =================================================================================== Ratios/Supplemental Data ----------------------------------------------------------------------------------------- Before Credit/Reimbursement After Credit/Reimbursement*** ----------------------------- ------------------------------ Ratio of Net Ratio of Net Ratio of Investment Ratio of Investment Ending Expenses Income to Expenses Income to Net to Average Average to Average Average Assets Net Assets Net Assets Net Assets Net Assets Applicable Applicable Applicable Applicable Applicable Portfolio to Common to Common to Common to Common to Common Turnover Shares (000) Shares++ Shares++ Shares++ Shares++ Rate =============================================================================================================== MICHIGAN QUALITY INCOME (NUM) - --------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 $176,186 1.24% 6.56% 1.24% 6.57% 15% 2002 179,630 1.28 7.29 1.27 7.29 19 2001 176,664 1.30 7.79 1.29 7.80 20 2000 167,429 1.29 8.29 1.27 8.31 25 1999 174,591 1.19 7.28 1.19 7.28 21 MICHIGAN PREMIUM INCOME (NMP) - --------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 117,418 1.21 6.49 1.20 6.50 18 2002 119,820 1.25 6.82 1.24 6.83 9 2001 117,784 1.24 7.24 1.23 7.25 15 2000 109,565 1.29 7.73 1.28 7.74 34 1999 112,851 1.29 6.82 1.28 6.83 9 MICHIGAN DIVIDEND ADVANTAGE (NZW) - --------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 29,443 1.29 6.15 .82 6.61 2 2002(a) 29,679 1.35* 6.00* .90* 6.45* 21 =============================================================================================================== Preferred Shares at End of Period ---------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share ============================================================== MICHIGAN QUALITY INCOME (NUM) - -------------------------------------------------------------- Year Ended 7/31: 2003 $94,000 $25,000 $71,858 2002 94,000 25,000 72,774 2001 94,000 25,000 71,985 2000 94,000 25,000 69,529 1999 94,000 25,000 71,434 MICHIGAN PREMIUM INCOME (NMP) - -------------------------------------------------------------- Year Ended 7/31: 2003 56,000 25,000 77,419 2002 56,000 25,000 78,491 2001 56,000 25,000 77,582 2000 56,000 25,000 73,913 1999 56,000 25,000 75,380 MICHIGAN DIVIDEND ADVANTAGE (NZW) - -------------------------------------------------------------- Year Ended 7/31: 2003 16,000 25,000 71,005 2002(a) 16,000 25,000 71,374 ============================================================== * Annualized. ** Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Common Share Net Asset Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in Common share net asset value per share. Total returns are not annualized. *** After custodian fee credit and expense reimbursement, where applicable. + The amounts shown are based on Common share equivalents. ++ Ratios do not reflect the effect of dividend payments to Preferred shareholders; income ratios reflect income earned on assets attributable to Preferred shares. (a) For the period September 25, 2001 (commencement of operations) through July 31, 2002. See accompanying notes to financial statements. 56-57 SPREAD
Financial HIGHLIGHTS (continued) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ----------------------------------------------------------------- ------------------------------- Distributions Distributions from Net from Net Beginning Net Investment Capital Investment Capital Common Realized/ Income to Gains to Income to Gains to Share Net Unrealized Preferred Preferred Common Common Net Asset Investment Investment Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total ============================================================================================================================== OHIO QUALITY INCOME (NUO) - ------------------------------------------------------------------------------------------------------------------------------ Year Ended 7/31: 2003 $16.36 $1.10 $(.22) $(.08) $-- $ .80 $(.99) $-- $(.99) 2002 16.10 1.14 .18 (.13) -- 1.19 (.93) -- (.93) 2001 15.52 1.20 .56 (.27) -- 1.49 (.91) -- (.91) 2000 16.13 1.21 (.56) (.29) -- .36 (.97) -- (.97) 1999 16.65 1.21 (.51) (.24) -- .46 (.98) -- (.98) OHIO DIVIDEND ADVANTAGE (NXI) - ------------------------------------------------------------------------------------------------------------------------------ Year Ended 7/31: 2003 14.83 1.05 (.23) (.07) -- .75 (.92) (.01) (.93) 2002 14.57 1.06 .19 (.12) -- 1.13 (.87) -- (.87) 2001(a) 14.33 .29 .35 (.04) -- .60 (.22) -- (.22) OHIO DIVIDEND ADVANTAGE 2 (NBJ) - ------------------------------------------------------------------------------------------------------------------------------ Year Ended 7/31: 2003 14.48 1.00 (.23) (.08) -- .69 (.87) -- (.87) 2002(b) 14.33 .78 .23 (.08) -- .93 (.62) -- (.62) OHIO DIVIDEND ADVANTAGE 3 (NVJ) - ------------------------------------------------------------------------------------------------------------------------------ Year Ended 7/31: 2003 14.83 .97 (.29) (.07) (.01) .60 (.88) (.06) (.94) 2002(c) 14.33 .25 .65 (.02) -- .88 (.22) -- (.22) ============================================================================================================================== Total Returns ----------------- Based Offering on Costs and Ending Common Preferred Common Based Share Share Share Ending on Net Underwriting Net Asset Market Market Asset Discounts Value Value Value** Value** ==================================================================================== OHIO QUALITY INCOME (NUO) - ------------------------------------------------------------------------------------ Year Ended 7/31: 2003 $-- $16.17 $17.0400 (3.15)% 4.84% 2002 -- 16.36 18.6200 17.00 7.63 2001 -- 16.10 16.8000 6.86 9.85 2000 -- 15.52 16.6250 (1.80) 2.50 1999 -- 16.13 18.0000 5.09 2.74 OHIO DIVIDEND ADVANTAGE (NXI) - ------------------------------------------------------------------------------------ Year Ended 7/31: 2003 .01 14.66 14.2600 (.04)% 5.09 2002 -- 14.83 15.1500 4.48 8.02 2001(a) (.14) 14.57 15.3500 3.77 3.21 OHIO DIVIDEND ADVANTAGE 2 (NBJ) - ------------------------------------------------------------------------------------ Year Ended 7/31: 2003 .01 14.31 14.2600 3.17 4.74 2002(b) (.16) 14.48 14.6500 1.91 5.58 OHIO DIVIDEND ADVANTAGE 3 (NVJ) - ------------------------------------------------------------------------------------ Year Ended 7/31: 2003 (.01) 14.48 14.4000 .09 3.81 2002(c) (.16) 14.83 15.3000 3.47 5.05 ==================================================================================== Ratios/Supplemental Data ----------------------------------------------------------------------------------------- Before Credit/Reimbursement After Credit/Reimbursement*** ----------------------------- ------------------------------ Ratio of Net Ratio of Net Ratio of Investment Ratio of Investment Ending Expenses Income to Expenses Income to Net to Average Average to Average Average Assets Net Assets Net Assets Net Assets Net Assets Applicable Applicable Applicable Applicable Applicable Portfolio to Common to Common to Common to Common to Common Turnover Shares (000) Shares++ Shares++ Shares++ Shares++ Rate ================================================================================================================ OHIO QUALITY INCOME (NUO) - ---------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 $155,412 1.22% 6.59% 1.22% 6.60% 12% 2002 156,351 1.26 7.10 1.24 7.12 26 2001 153,164 1.32 7.58 1.30 7.60 15 2000 147,045 1.31 7.88 1.29 7.89 11 1999 151,961 1.26 7.26 1.25 7.27 3 OHIO DIVIDEND ADVANTAGE (NXI) - ---------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 61,924 1.23 6.52 .78 6.97 6 2002 62,548 1.24 6.79 .78 7.25 18 2001(a) 61,424 1.15* 5.58* .71* 6.02* 4 OHIO DIVIDEND ADVANTAGE 2 (NBJ) - ---------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 44,578 1.27 6.26 .81 6.72 15 2002(b) 45,073 1.25* 6.12* .80* 6.57* 39 OHIO DIVIDEND ADVANTAGE 3 (NVJ) - ---------------------------------------------------------------------------------------------------------------- Year Ended 7/31: 2003 31,245 1.28 5.89 .82 6.35 16 2002(c) 31,995 1.22* 4.72* .80* 5.15* 7 ================================================================================================================ Preferred Shares at End of Period ---------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share =============================================================== OHIO QUALITY INCOME (NUO) - --------------------------------------------------------------- Year Ended 7/31: 2003 $77,000 $25,000 $75,458 2002 77,000 25,000 75,763 2001 77,000 25,000 74,729 2000 77,000 25,000 72,742 1999 77,000 25,000 74,338 OHIO DIVIDEND ADVANTAGE (NXI) - --------------------------------------------------------------- Year Ended 7/31: 2003 31,000 25,000 74,938 2002 31,000 25,000 75,442 2001(a) 31,000 25,000 74,535 OHIO DIVIDEND ADVANTAGE 2 (NBJ) - --------------------------------------------------------------- Year Ended 7/31: 2003 24,000 25,000 71,435 2002(b) 24,000 25,000 71,951 OHIO DIVIDEND ADVANTAGE 3 (NVJ) - --------------------------------------------------------------- Year Ended 7/31: 2003 16,500 25,000 72,341 2002(c) 16,500 25,000 73,477 =============================================================== * Annualized. ** Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Common Share Net Asset Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in Common share net asset value per share. Total returns are not annualized. *** After custodian fee credit and expense reimbursement, where applicable. + The amounts shown are based on Common share equivalents. ++ Ratios do not reflect the effect of dividend payments to Preferred shareholders; income ratios reflect income earned on assets attributable to Preferred shares. (a) For the period March 28, 2001 (commencement of operations) through July 31, 2001. (b) For the period September 26, 2001 (commencement of operations) through July 31, 2002. (c) For the period March 27, 2002 (commencement of operations) through July 31, 2002. See accompanying notes to financial statements. 58-59 SPREAD
Directors/Trustees AND 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 of Directors/ Trustees of the Funds. The number of directors/trustees of the Funds is currently set at eight. None of the directors/trustees who are not "interested" persons of the Funds has ever been a director or employee of, or consultant to, Nuveen or its affiliates. The names and business addresses of the directors/trustees 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 OF PORTFOLIOS IN FUND COMPLEX YEAR FIRST PRINCIPAL OCCUPATION(S) OVERSEEN NAME, BIRTHDATE POSITION(S) HELD ELECTED OR INCLUDING OTHER DIRECTORSHIPS BY DIRECTOR/ AND ADDRESS WITH THE FUNDS APPOINTED(2) DURING PAST 5 YEARS TRUSTEE - ------------------------------------------------------------------------------------------------------------------------------------ DIRECTOR/TRUSTEE WHO IS AN INTERESTED PERSON OF THE FUNDS: - ------------------------------------------------------------------------------------------------------------------------------------ Timothy R. Schwertfeger (1) Chairman of the 1994 Chairman and Director (since 1996) of Nuveen 140 3/28/49 Board and Investments, Inc. and Nuveen Investments, LLC; 333 W. Wacker Drive Director/Trustee Director (since 1992) and Chairman (since 1996) of Chicago, IL 60606 Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp.; Chairman and Director (since 1997) of Nuveen Asset Management, Inc.; Director (since 1996) of Institutional Capital Corporation; Chairman and Director (since 1999) of Rittenhouse Asset Management, Inc.; Chairman of Nuveen Investments Advisers Inc. (since 2002). DIRECTORS/TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE FUNDS: - ------------------------------------------------------------------------------------------------------------------------------------ William E. Bennett Director/Trustee 2001 Private Investor; previously, President and 140 10/16/46 Chief Executive Officer, Draper & Kramer, Inc., a 333 W. Wacker Drive private company that handles mortgage banking, real Chicago, IL 60606 estate development, pension advisory and real estate management (1995-1998). Prior thereto, Executive Vice President and Chief Credit Officer of First Chicago Corporation and its principal subsidiary, The First National Bank of Chicago. - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner Director/Trustee 1997 Private Investor and Management Consultant. 134 8/22/40 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Lawrence H. Brown Director/Trustee 1993 Retired (since 1989) as Senior Vice President of The 134 7/29/34 Northern Trust Company; Director of the United Way of 333 W. Wacker Drive Highland Park-Highwood (since 2002). Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Anne E. Impellizzeri Director/Trustee 1994 Retired, formerly, Executive Director (since 1998) 134 1/26/33 of Manitoga/The Russel Wright Design Center; prior 333 W. Wacker Drive thereto, President and Chief Executive Officer of Chicago, IL 60606 Blanton-Peale Institute (since 1990); prior thereto, Vice President, Metropolitan Life Insurance Co. - ------------------------------------------------------------------------------------------------------------------------------------ Peter R. Sawers Director/Trustee 1991 Adjunct Professor of Business and Economics, 134 4/3/33 University of Dubuque, Iowa; formerly (1991-2000) 333 W. Wacker Drive Adjunct Professor, Lake Forest Graduate School of Chicago, IL 60606 Management, Lake Forest, Illinois; prior thereto, Executive Director, Towers Perrin Australia, a management consulting firm; Chartered Financial Analyst; Certified Management Consultant; Director, Executive Service Corps of Chicago, a not-for-profit organization. - ------------------------------------------------------------------------------------------------------------------------------------ William J. Schneider Director/Trustee 1997 Senior Partner and Chief Operating Officer, 134 9/24/44 Miller-Valentine Group, Vice President, Miller- 333 W. Wacker Drive Valentine Realty, a development and contract company; Chicago, IL 60606 Chair, MiamiValley Hospital; Chair, Miami Valley Economic Development Coalition; formerly, Member, Community Advisory Board, National City Bank, Dayton, Ohio and Business Advisory Council, Cleveland Federal Reserve Bank. - ------------------------------------------------------------------------------------------------------------------------------------ Judith M. Stockdale Director/Trustee 1997 Executive Director, Gaylord and Dorothy Donnelley 134 12/29/47 Foundation (since 1994); prior thereto, Executive 333 W. Wacker Drive Director, Great Lakes Protection Fund (from 1990 Chicago, IL 60606 to 1994). 60 NUMBER OF PORTFOLIOS IN FUND YEAR FIRST COMPLEX NAME, BIRTHDATE POSITION(S) HELD ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN AND ADDRESS WITH THE FUNDS APPOINTED(3) DURING PAST 5 YEARS BY OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE FUNDS: - ------------------------------------------------------------------------------------------------------------------------------------ Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary 140 9/9/56 Administrative and Associate General Counsel, formerly, Vice 333 W. Wacker Drive Officer President and Assistant General Counsel of Nuveen Chicago, IL 60606 Investments, LLC; Managing Director (since 2002), General Counsel and Assistant Secretary, formerly, Vice President of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp.; Managing Director (since 2002), Assistant Secretary and Associate General Counsel, formerly, Vice President (since 2000), of Nuveen Asset Management, Inc.; Assistant Secretary of Nuveen Investments, Inc. (since 1994); Assistant Secretary of NWQ Investment Management Company, LLC (since 2002); Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002); Managing Director, Associate General Counsel and Assistant Secretary of Rittenhouse Asset Management, Inc. (since May 2003); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant 140 2/3/66 and Assistant Vice President (since 2000), previously, Associate of 333 W. Wacker Drive Secretary Nuveen Investments, LLC. Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Paul L. Brennan Vice President 1999 Vice President (since 2002), formerly, Assistant 122 11/10/66 Vice President (since 1997), of Nuveen Advisory Corp.; 333 W. Wacker Drive prior thereto, portfolio manager of Flagship Financial Chicago, IL 60606 Inc.; Chartered Financial Analyst and Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 140 11/28/67 and Treasurer 1999), prior thereto, Assistant Vice President (since 333 W. Wacker Drive 1997); Vice President and Treasurer of Nuveen Chicago, IL 60606 Investments, Inc. (since 1999); Vice President and Treasurer of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. (since 1999); Vice President and Treasurer of Nuveen Asset Management, Inc. (since 2002) and of Nuveen Investments Advisers Inc. (since 2002); Assistant Treasurer of NWQ Investment Management Company, LLC (since 2002); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Susan M. DeSanto Vice President 2001 Vice President of Nuveen Advisory Corp. (since 2001); 140 9/8/54 previously, Vice President of Van Kampen Investment 333 W. Wacker Drive Advisory Corp. (since 1998); Vice President of Nuveen Chicago, IL 60606 Institutional Advisory Corp. (since 2002); prior thereto, Assistant Vice President of Van Kampen Investment Advisory Corp. (since 1994). - ------------------------------------------------------------------------------------------------------------------------------------ Jessica R. Droeger Vice President 2000 Vice President (since 2002) and Assistant General 140 9/24/64 and Secretary Counsel (since 1998); formerly, Assistant Vice 333 W. Wacker Drive President (since 1998) of Nuveen Investments, LLC; Chicago, IL 60606 Vice President (since 2002) and Assistant Secretary (since 1998), formerly Assistant Vice President of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. 61 Trustees AND OFFICERS (CONTINUED) NUMBER OF PORTFOLIOS IN FUND YEAR FIRST COMPLEX NAME, BIRTHDATE POSITION(S) HELD ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN AND ADDRESS WITH THE FUNDS APPOINTED(3) DURING PAST 5 YEARS BY OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE FUNDS (CONTINUED): - ------------------------------------------------------------------------------------------------------------------------------------ Lorna C. Ferguson Vice President 1998 Vice President of Nuveen Investments, LLC; Vice 140 10/24/45 President (since 1998) of Nuveen Advisory Corp. and 333 W. Wacker Drive Nuveen Institutional Advisory Corp. Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen Investments, 140 3/2/64 LLC; Managing Director (since 2001), formerly Vice 333 W. Wacker Drive President of Nuveen Advisory Corp. and Nuveen Chicago, IL 60606 Institutional Advisory Corp. (since 1995); Managing Director of Nuveen Asset Management, Inc. (since 2001); Vice President of Nuveen Investment Advisers Inc. (since 2002); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller 140 5/31/54 and Controller (since 1998) of Nuveen Investments, LLC and Vice 333 W. Wacker Drive President and Funds Controller (since 1998) of Chicago, IL 60606 Nuveen Investments, Inc.; Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ J. Thomas Futrell Vice President 1988 Vice President of Nuveen Advisory Corp.; 122 7/5/55 Chartered Financial Analyst. 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Richard A. Huber Vice President 1997 Vice President of Nuveen Institutional Advisory Corp. 122 3/26/63 (since 1998) and Nuveen Advisory Corp. (since 1997); 333 W. Wacker Drive prior thereto, Vice President and Portfolio Manager Chicago, IL 60606 of Flagship Financial, Inc. - ------------------------------------------------------------------------------------------------------------------------------------ Steven J. Krupa Vice President 1990 Vice President of Nuveen Advisory Corp. 122 8/21/57 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 140 3/22/63 LLC, previously Assistant Vice President (since 333 W. Wacker Drive 1999); prior thereto, Associate of Nuveen Investments, Chicago, IL 60606 LLC; Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ Tina M. Lazar Vice President 2002 Vice President (since 1999), previously, Assistant 140 8/27/61 Vice President (since 1993) of Nuveen Investments, LLC. 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant 140 7/27/51 and Assistant General Counsel of Nuveen Investments, LLC; Vice 333 W. Wacker Drive Secretary President and Assistant Secretary of Nuveen Advisory Chicago, IL 60606 Corp. and Nuveen Institutional Advisory Corp.; Assistant Secretary of Nuveen Investments, Inc. and (since 1997) Nuveen Asset Management, Inc.; Vice President (since 2000), Assistant Secretary and Assistant General Counsel (since 1998) of Rittenhouse Asset Management, Inc.; Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002); Assistant Secretary of NWQ Investment Management Company, LLC (since 2002). 62 NUMBER OF PORTFOLIOS IN FUND YEAR FIRST COMPLEX NAME, BIRTHDATE POSITION(S) HELD ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN AND ADDRESS WITH THE FUNDS APPOINTED(3) DURING PAST 5 YEARS BY OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE FUNDS (CONTINUED): - ------------------------------------------------------------------------------------------------------------------------------------ Edward F. Neild, IV Vice President 1996 Managing Director (since 2002) of Nuveen Investments, 140 7/7/65 LLC; Managing Director (since 1997), formerly Vice 333 W. Wacker Drive President (since 1996) of Nuveen Advisory Corp. and Chicago, IL 60606 Nuveen Institutional Advisory Corp.; Managing Director of Nuveen Asset Management, Inc. (since 1999). Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Thomas J. O'Shaughnessy Vice President 1999 Vice President (since 2002), formerly, Assistant 122 9/4/60 Vice President (since 1998), of Nuveen Advisory 333 W. Wacker Drive Corp.; prior thereto, portfolio manager. Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Thomas C. Spalding Vice President 1982 Vice President of Nuveen Advisory Corp. and Nuveen 122 7/31/51 Institutional Advisory Corp.; Chartered Financial 333 W. Wacker Drive Analyst. Chicago, IL 60606
(1) Mr. Schwertfeger is an "interested person" of the Funds, as defined in the Investment Company Act of 1940, because he is an officer and trustee of the Adviser. (2) Directors/Trustees serve a one-year term until his/her successor is elected. The year first elected or appointed represents the year in which the Directors/Trustee was first elected or appointed to any fund in the Nuveen Complex. (3) Officers serve a one-year term 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. 63 Build Your Wealth AUTOMATICALLY SIDEBAR TEXT: NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR REINVESTMENT ACCOUNT. NUVEEN CLOSED-END EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Closed-End Exchange-Traded 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 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. 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 shares may increase before purchases are completed, the average purchase price 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. FLEXIBILITY 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. 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. 64 Fund INFORMATION BOARD OF DIRECTORS/TRUSTEES William E. Bennett Robert P. Bremner Lawrence H. Brown Anne E. Impellizzeri Peter R. Sawers William J. Schneider Timothy R. Schwertfeger Judith M. Stockdale FUND MANAGER Nuveen Advisory Corp. 333 West Wacker Drive Chicago, IL 60606 CUSTODIAN State Street Bank & Trust Boston, MA TRANSFER AGENT AND SHAREHOLDER SERVICES State Street Bank & Trust Nuveen Funds P.O. Box 43071 Providence, RI 02940-3071 (800) 257-8787 LEGAL COUNSEL Chapman and Cutler LLP Chicago, IL INDEPENDENT AUDITORS Ernst & Young LLP Chicago, IL POLICY CHANGE On November 14, 2002, the Board adopted a policy that allows these Funds, in addition to investments in municipal bonds, to invest up to 5% of its net assets (including assets attributable to preferred shares, if any) in tax-exempt or taxable fixed-income securities or equity securities for the purpose of acquiring control of an issuer whose municipal bonds (a) the Fund already owns and (b) have deteriorated or are expected shortly to deteriorate significantly in credit quality, provided Nuveen Advisory determines that such investment should enable the Fund to better maximize the value of its existing investment in such issuer. This policy is a non-fundamental policy of each Fund which means that it can be changed at any time by the Board of Trustees without vote of the shareholders. GLOSSARY OF TERMS USED IN THIS REPORT 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 (including change in NAV and reinvested dividends) that would have been necessary on an annual basis to equal the investment's actual performance over the time period being considered. Average Effective Maturity: The average of all the maturities of the bonds in a fund's portfolio, computed by weighting each maturity date (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. Leverage-Adjusted Duration: Duration is a measure of a bond or bond fund's sensitivity to changes in interest rates. Generally, the longer a bond 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 generally longer than the duration of the actual portfolio of individual bonds that make up the Fund Market Yield (also known as Dividend Yield or Current Yield): An investment's current annualized dividend divided by its current market price. Net Asset Value (NAV): A fund's NAV is calculated by subtracting the liabilities of the fund from its total assets and then dividing the remainder by the number of shares outstanding. Fund NAVs are calculated at the end of each business day. 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. - --------- Each Fund intends to repurchase shares of its own common or preferred stock in the future at such times and in such amounts as is deemed advisable. No shares were repurchased during the fiscal year ended July 31, 2003. Any future repurchases will be reported to shareholders in the next annual or semiannual report. 65 Serving Investors FOR GENERATIONS Since 1898, financial advisors and their clients have relied on Nuveen Investments to provide dependable investment solutions. For the past century, Nuveen Investments has adhered to the belief that the best approach to investing is to apply conservative risk-management principles to help minimize volatility. Building on this tradition, we today offer a range of high quality equity and fixed-income solutions that are integral to a well-diversified core portfolio. Our clients have come to appreciate this diversity, as well as our continued adherence to proven, long-term investing principles. Managing $80 billion in assets, Nuveen Investments offers access to a number of different asset classes and investing solutions through a variety of products. Nuveen Investments markets its capabilities under four distinct brands: Nuveen, a leader in tax-free investments; NWQ, a leader in value-style equities; Rittenhouse, a leader in growth-style equities; and Symphony, a leading institutional manager of market-neutral alternative investment portfolios. To learn more about the products and services Nuveen Investments offers and for a prospectus, where applicable, talk to your financial advisor, or call us at (800) 257-8787. Please read the information carefully before you invest. Distributed by NUVEEN INVESTMENTS, LLC | 333 West Wacker Drive | Chicago, Illinois 60606 | www.nuveen.com EAN-B-0703D 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. The registrant has posted such code of ethics on its website at www.nuveen.com/etf. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The registrant's board of directors has 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 William E. Bennett, who is "independent" for purposes of Item 3 of Form N-CSR. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable at this time. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable at this time. ITEM 6. [RESERVED] ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES In the rare event that a municipal issuer held by the Fund were to issue a proxy or that the Fund were to receive a proxy issued by a cash management security, Nuveen Advisory Corp. (the "Adviser") 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 Fund's Board of Directors or Trustees or its representative. A member of the Adviser'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 Board of Directors or Trustees and made available to shareholders as required by applicable rules. ITEM 8. [RESERVED] ITEM 9. 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 these 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 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 registrant's last fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 10. 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 posted on registrant's website. (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 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT Attached hereto. (b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certification required by Rule 30a-2(b) under the 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 Dividend Advantage Municipal Fund ----------------------------------------------------------- By (Signature and Title)* /s/ Jessica R. Droeger ---------------------------------------------- Jessica R. Droeger Vice President and Secretary Date: October 8, 2003 ------------------------------------------------------------------- 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 ---------------------------------------------- Gifford R. Zimmerman Chief Administrative Officer (Principal Executive Officer) Date: October 8, 2003 ------------------------------------------------------------------- By (Signature and Title)* /s/ Stephen D. Foy ---------------------------------------------- Stephen D. Foy Vice President and Controller (Principal Financial Officer) Date: October 8, 2003 ------------------------------------------------------------------- * Print the name and title of each signing officer under his or her signature. EX-99.CERT 3 file002.txt CERTIFICATIONS N-CSR FORM OF CERTIFICATION I, Gifford R. Zimmerman, certify that: 1. I have reviewed this report on Form N-CSR of Nuveen Michigan Dividend Advantage Municipal Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: October 8, 2003 /s/ Gifford R. Zimmerman ------------------------- -------------------------------- Chief Administrative Officer (principal executive officer) N-CSR FORM OF CERTIFICATION I, Stephen D. Foy, certify that: 1. I have reviewed this report on Form N-CSR of Nuveen Michigan Dividend Advantage Municipal Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: October 8, 2003 /s/ Stephen D. Foy ------------------------- -------------------------------- Vice President and Controller (principal financial officer) EX-99.906CERT 4 file003.txt CERTIFICATIONS Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002; provided by the Chief Executive Officer and Chief Financial Officer, based on each such officer's knowledge and belief. The undersigned officers of Nuveen Michigan Dividend Advantage Municipal Fund (the "Fund"), certify that, to the best of each such officer's knowledge and belief: 1. The Form N-CSR of the Fund for the period ended July 31, 2003 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. Date: October 8, 2003 ----------------------- /s/ Gifford R. Zimmerman --------------------- Chief Administrative Officer (Chief Executive Officer) /s/ Stephen D. Foy --------------------- Vice President, Controller (Chief Financial Officer) -----END PRIVACY-ENHANCED MESSAGE-----