N-CSRS 1 file001.txt NUVEEN NEW JERSEY DIVIDEND ADVANTAGE MUNI FUND 2 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 811-10551 --------------------- Nuveen New Jersey Dividend Advantage Municipal Fund 2 ------------------------------------------------------------------------------ (Exact name of registrant as specified in charter) Nuveen Investments 333 West Wacker Drive Chicago, IL 60606 ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip code) Kevin J. McCarthy 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: April 30 ------------------ Date of reporting period: October 31, 2008 ------------------ 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. SEMI-ANNUAL REPORT | Nuveen Investments October 31, 2008 | MUNICIPAL CLOSED-END FUNDS Photo of: Small child NUVEEN NEW JERSEY INVESTMENT QUALITY MUNICIPAL FUND, INC. NQJ NUVEEN NEW JERSEY PREMIUM INCOME MUNICIPAL FUND, INC. NNJ NUVEEN NEW JERSEY DIVIDEND ADVANTAGE MUNICIPAL FUND NXJ NUVEEN NEW JERSEY DIVIDEND ADVANTAGE MUNICIPAL FUND 2 NUJ NUVEEN PENNSYLVANIA INVESTMENT QUALITY MUNICIPAL FUND NQP NUVEEN PENNSYLVANIA PREMIUM INCOME MUNICIPAL FUND 2 NPY NUVEEN PENNSYLVANIA DIVIDEND ADVANTAGE MUNICIPAL FUND NXM NUVEEN PENNSYLVANIA DIVIDEND ADVANTAGE MUNICIPAL FUND 2 NVY IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R) Logo: NUVEEN Investments Photo of: Man working on computer LIFE IS COMPLEX. NUVEEN MAKES THINGS E-simple. It only takes a minute to sign up for e-Reports. Once enrolled, you'll receive an e-mail as soon as your Nuveen Investments Fund information is ready--no more waiting for delivery by regular mail. Just click on the link within the e-mail to see the report and save it on your computer if you wish. FREE E-REPORTS RIGHT TO YOUR E-MAIL! www.investordelivery.com If you receive your Nuveen Fund dividends and statements from your financial advisor or brokerage account. OR www.nuveen.com/accountaccess If you receive your Nuveen Fund dividends and statements directly from Nuveen. Logo: NUVEEN Investments Photo of: Robert P. Bremner Chairman's LETTER TO SHAREHOLDERS | Robert P. Bremner | Chairman of the Board Dear Shareholders, I'd like to use my initial letter to you to accomplish several things. First, I want to report that after fourteen years of service on your Fund's Board, including the last twelve as chairman, Tim Schwertfeger retired from the Board in June. The Board has elected me to replace him as the chairman, the first time this role has been filled by someone who is not an employee of Nuveen Investments. Electing an independent chairman marks a significant milestone in the management of your Fund, and it aligns us with what is now considered a "best practice" in the fund industry. Further, it demonstrates the independence with which your Board has always acted on your behalf. Following Tim will not be easy. During my eleven previous years on the Nuveen Fund Board, I found that Tim always set a very high standard by combining insightful industry and market knowledge and sound, clear judgment. While the Board will miss his wise counsel, I am certain we will retain the primary commitment Tim shared with all of us - an unceasing dedication to creating and retaining value for Nuveen Fund shareholders. This focus on value over time is a touchstone that I and all the other Board members will continue to use when making decisions on your behalf. Second, I also want to report that we are very fortunate to welcome two new Board members to our team. John Amboian, the current chairman and CEO of Nuveen Investments, has replaced Tim as Nuveen's representative on the Board. John's presence will allow the independent Board members to benefit not only from his leadership role at Nuveen but also his broad understanding of the fund industry and Nuveen's role within it. We also added Terry Toth as an independent director. A former CEO of the Northern Trust Company's asset management group, Terry will bring extensive experience in the fund industry to our deliberations. Third, on behalf of the entire Board, I would like you to know that we are closely monitoring the unprecedented market developments and their distressing impact on the Funds. We believe that these Funds continue to be actively and constructively managed for the long term and at the same time we are very aware that these are trying times for our investors. We appreciate the patience you have shown with the Board and with Nuveen Investments as they manage your investment through this extremely difficult period. Fourth, again on behalf of the entire Board, I would like to acknowledge the effort the whole Nuveen organization is making to resolve the auction rate preferred share situation in a satisfactory manner. As you know, we are actively pursuing a number of possible solutions, all with the goal of providing liquidity for preferred shareholders while preserving the potential benefits of leverage for common shareholders. We appreciate the patience you have shown as we've worked through the many difficulties involved. Finally, I urge you to take the time to review the Portfolio Manager's Comments, the Common Share Dividend and Share Price Information, and the Performance Overview sections of this report. All of us are grateful that you have chosen Nuveen Investments as a partner as you pursue your financial goals, and, on behalf of myself and the other members of your Fund's Board, let me say we look forward to continuing to earn your trust in the months and years ahead. Sincerely, /s/ Robert P. Bremner Robert P. Bremner Chairman of the Board December 23, 2008 Portfolio Manager's COMMENTS Nuveen Investments Municipal Closed-End Funds | NQJ, NNJ, NXJ, NUJ, NQP, NPY, NXM, NVY Portfolio manager Cathryn Steeves discusses key investment strategies and the six-month performance of the Nuveen New Jersey and Pennsylvania Funds. Cathryn, who joined Nuveen in 1996, assumed portfolio management responsibility for these eight Funds in 2006. WHAT KEY STRATEGIES WERE USED TO MANAGE THE NUVEEN NEW JERSEY AND PENNSYLVANIA FUNDS DURING THE SIX-MONTH REPORTING PERIOD ENDED OCTOBER 31, 2008? During this period, stress in the financial markets resulted in increased price volatility for many securities, reduced liquidity and a general flight to quality. In this turbulent environment, we took a defensive approach to managing the Funds, focusing on managing duration(1) risk, preserving and enhancing liquidity, as appropriate, and remaining invested for the long term. As events unfolded, we carefully monitored the municipal bond market for attractive purchase opportunities, using a fundamental approach to find undervalued sectors and individual credits with the potential to perform well over the long term. One area of focus in the New Jersey Funds was buying high-quality bonds with longer maturities that could help to maintain and extend the Funds' durations and had the potential to enhance yields and returns overtime. In the Pennsylvania Funds, we purchased both higher and lower quality health care bonds and higher coupon housing securities that were very attractively priced. To provide liquidity for purchases, we selectively sold holdings with shorter durations. We also monitored the types of credits and bond structures that were attractive to the retail market and took advantage of strong bids to sell such bonds into solid retail demand. In addition, some of our new purchases were funded by reinvesting the proceeds from called or matured bonds, especially in the Pennsylvania Funds. As a key dimension of risk management, we employed a disciplined approach to duration positioning as an important component of our overall strategy. As part of this approach, we used inverse floating rate securities(2) in all of the Funds except NUJ, NVY and NXM during this period. Inverse floaters typically provide the dual benefit of bringing the Funds' durations closer to our strategic target and enhancing their income-generation capabilities. NNJ and NVY also invested in certain types of (1) Duration is a measure of a bond's price sensitivity as interest rates change, with longer duration bonds displaying more sensitivity to these changes than bonds with shorter durations. (2) An inverse floating rate security is a financial instrument designed to pay long-term tax-exempt interest at a rate that varies inversely with a short-term tax-exempt interest rate index. For the Nuveen Funds, the index typically used is the Securities Industry and Financial Markets (SIFM) Municipal Swap Index (previously referred to as the Bond Market Association Index or BMA). Inverse floaters, including those inverse floating rate securities in which the Funds invested during this reporting period, are further defined within the Notes to Financial Statements and Glossary of Terms Used in This Report sections of this shareholder report. Discussions of specific investments are for illustrative purposes only and are not intended as recommendations of individual investments. The views expressed in this commentary represent those of the portfolio manager as of the date of this report and are subject to change at any time, based on market conditions and other factors. The Funds disclaim any obligation to advise shareholders of such changes. 4 derivative instruments in an effort to lengthen duration and help manage common share net asset value (NAV) volatility while trying to minimize any negative impact on income streams or common share dividends over the short term. As of October 31, 2008, we continued to use inverse floaters in NQJ, NNJ, NXJ, NQP and NPY, and the derivatives remained in place in NNJ and NVY. HOW DID THE FUNDS PERFORM? Individual results for the Nuveen New Jersey and Pennsylvania Funds, as well as relevant index and peer group information, are presented in the accompanying table. Annualized Total Returns on Common Share Net Asset Value* For periods ended 10/31/08 Six-Month 1-Year 5-Year 10-Year New Jersey Funds NQJ -12.43% -12.56% 1.55% 3.66% NNJ -10.59% -10.28% 1.57% 3.92% NXJ -13.62% -14.28% 1.32% N/A NUJ -13.79% -14.38% 1.66% N/A Pennsylvania Funds NQP -13.60% -14.11% 0.58% 3.09% NPY -15.21% -16.57% -0.04% 3.07% NXM -14.66% -15.32% 0.93% N/A NVY -12.52% -13.26% 1.39% N/A Lipper Other States Municipal Debt Funds Average(3) -13 01% -13.59% 1.15% 3.31% Barclays Capital Municipal Bond Index(4) -4.70% - 3.30% 2.73% 4.14% S&P National Municipal Bond Index(5) -5.19% -4.15% 2.75% N/A For the six months ended October 31, 2008, the cumulative returns on common share NAV for NQJ, NNJ and NVY exceeded the average return for the Lipper Other States Municipal Debt Funds Average, while the remaining five Funds lagged this return. All of the Funds underperformed the Barclays Capital Municipal Bond Index and Standard & Poor's (S&P) National Municipal Bond Index. *Six-month returns are cumulative; returns for one-year, five-year and ten-year are annualized. Past performance is not predictive of future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. For additional information, see the individual Performance Overview for your Fund in this report. (3) The Lipper Other States Municipal Debt Funds Average is calculated using the returns of all closed-end funds in this category for each period as follows: 6 months, 46 funds; 1 year, 46 funds; 5 years, 46 funds; and 10 years, 18 funds. Fund and Lipper returns assume reinvestment of dividends. Shareholders should note that the performance of the Lipper Other States category represents the overall average of returns for funds from 10 different states with a wide variety of municipal market conditions, making direct comparisons less meaningful. (4) The Barclays Capital (formerly Lehman Brothers) Municipal Bond Index is an unleveraged, unmanaged national index comprising a broad range of investment-grade municipal bonds. Results for the Barclays Capital index do not reflect any expenses. (5) The Standard & Poor's (S&P) National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the investment-grade U.S. municipal bond market. 5 Key management factors that influenced the Funds' returns during this period included duration positioning, the use of inverse floaters, credit exposure and sector allocations. In addition, a major factor affecting each Fund's performance over this period was the use of leverage. The impact of leverage is discussed in more detail on page seven. Over the course of this reporting period, we saw the yield curve steepen, as interest rates at the short end of the curve declined and longer-term rates generally rose, especially during September and October. Given these changes in the interest rate environment, bonds in the Barclays Capital Municipal Bond Index with maturities of ten years or less generally outperformed the market as a whole and bonds maturing in one to four years benefited the most. In general, these shorter bonds outperformed credits with longer maturities, while bonds having the longest maturities (twenty-two years and longer) posted the worst returns. Among the New Jersey Funds, NQJ and NNJ had shorter durations than NXJ and NUJ, which benefited their performances relative to the latter two Funds. In NPY, which had the longest duration among the four Pennsylvania Funds, the impact of duration positioning caused the performance of this Fund to trail that of the other three. As mentioned earlier, all of the Funds except NUJ, NXM and NVY used inverse floaters during this period to help bring their durations closer to our strategic target and enhance income-generation capabilities. In general, these inverse floaters had a negative impact on performance. This resulted from the fact that the inverse floaters effectively increased the Funds' exposure to longer maturity bonds at a time when shorter maturities were in favor in the market. Credit exposure was also an important factor in performance during these past six months. Because risk-averse investors generally sought higher quality investments as disruptions in the financial markets deepened, bonds with higher credit quality ratings typically performed very well. At the same time, bonds rated BBB or below and non-rated bonds generally posted poor returns. As of October 31, 2008, the New Jersey Funds had weightings of bonds rated BBB or lower and non-rated bonds ranging from 13% to 22%, while the Pennsylvania Funds' allocations totaled approximately 10% to 20%. While the exposure to lower-rated credits had a negative impact on the Funds for this period, the overall higher credit quality of NNJ and NQP was a relatively positive factor in these Funds' six-month performances. Sectors of the market that generally contributed positively to the Funds' performances included general and limited tax obligation issues and resource recovery credits. Pre-refunded bonds(6), which are usually backed by U.S. Treasury securities, were one of the top performing segments of the market, due primarily to their shorter effective maturities, higher credit quality, and perceived safety. Among these Funds, NQP and NVY had the largest allocations of pre-refunded bonds as of October 31, 2008, while NXM held the smallest allocation. (6) Pre-refundings, also known as advance refundings or refinancings, occur when an issuer sells new bonds and uses the proceeds to fund principal and interest payments of older existing bonds. This process often results in lower borrowing costs for bond issuers. 6 In general, bonds that carried any credit risk, regardless of sector, posted weak performance. Revenue bonds as a whole, and the industrial development and housing sectors in particular, underperformed the general municipal market. The performance of the New Jersey Funds was helped during this period by the fact that they had underweighted the housing sector. Next to the industrial development revenue sector, zero coupon bonds were among the worst performing categories in the municipal market. The health care sector also performed poorly, as did lower-rated bonds backed by the 1998 master tobacco settlement agreement. IMPACT OF THE FUNDS' CAPITAL STRUCTURES AND LEVERAGE STRATEGIES ON PERFORMANCE In addition to the factors mentioned above, one of the primary factors negatively impacting the six-month returns of these Funds relative to those of the unleveraged Barclays Capital Municipal Bond Index and S&P National Municipal Bond Index was the Funds'use of financial leverage. While leverage offers opportunities to generate additional income and total returns for common shareholders, the benefits provided by leveraging are influenced by the price movements of the bonds in each Fund's portfolio. During this period, as yields on longer-term bonds rose and their prices correspondingly fell, declining valuations had a negative effect on performance that was magnified by the use of leverage. In addition, at various points during the six-month period, the Funds' borrowing costs were relatively high, negatively impacting their total returns. RECENT DEVELOPMENTS IN THE MARKET ENVIRONMENT Beginning in October, the nation's financial institutions and financial markets--including the municipal bond market--experienced significant turmoil. Reductions in demand decreased valuations of municipal bonds across all credit ratings, especially those with lower credit ratings, and this generally reduced the Funds' net asset values. The municipal market is one in which dealer firms make markets in bonds on a principal basis using their proprietary capital, and during the recent market turmoil these firms'capital was severely constrained. As a result, some firms were unwilling to commit their capital to purchase and to serve as a dealer for municipal bonds. This reduction in dealer involvement in the market was accompanied by significant net selling pressure by investors, particularly with respect to lower-rated municipal bonds, as institutional investors generally removed money from the municipal bond market, at least in part because of their need to reduce the leveraging of their municipal investments. This de-leveraging was in part driven by the overall reduction in the amount of financing available for such leverage, the increased costs of such leverage financing, and the need to reduce leverage levels that had recently increased due to the decline in municipal bond prices. 7 Municipal bond prices were further negatively impacted by concerns that the need for further de-leveraging and a supply overhang as a large amount of new issues were postponed would cause selling pressure to persist for a period of time. In addition to falling prices, these market conditions resulted in greater price volatility of municipal bonds; wider credit spreads (i.e., lower quality bonds fell in price more than higher quality bonds); significantly reduced liquidity (i.e., the ability to sell bonds at a price close to their carrying value), particularly for lower quality bonds; and a lack of price transparency (i.e., the ability to accurately determine the price at which a bond would likely trade). Reduced liquidity was most pronounced in mid-October, and although liquidity improved considerably over ensuing weeks, it may reoccur if financial turmoil persists or worsens. RECENT DEVELOPMENTS REGARDING BOND INSURANCE COMPANIES As mentioned earlier, another factor that had an impact on the performance of these Funds was their position in bonds backed by municipal bond insurers that experienced downgrades in their credit ratings. During the period covered by this report, ACA, AMBAC, CIFG, FGIC, MBIA, RAAI and SYNCORA (formerly XLCA) experienced one or more rating reductions by at least one or more rating agencies. Subsequent to the reporting period, AMBAC, MBIA and SYNCORA experienced further rating reductions while AGCand FSA received their first rating reduction by at least one rating agency. At the time this report was prepared, at least one rating agency has placed each of these insurers except AGC on "negative outlook" or "negative credit watch," which may presage one or more rating reductions for such insurer or insurers in the future. As concern increased about the balance sheets of these insurers, prices on bonds insured by these companies - especially those bonds with weaker underlying credits - declined, detracting from the Funds' performance. By the end of this period, most insured bond's were being valued according to their fundamentals as if they were uninsured. On the whole, the holdings of all of our Funds continued to be well diversified not only between insured and uninsured bonds, but also within the insured bond category. It is important to note that municipal bonds historically have had a very low rate of default. RECENT DEVELOPMENTS IN THE AUCTION RATE PREFERRED SECURITIES MARKETS Beginning in February 2008, more shares for sale were submitted in the regularly scheduled auctions for the auction rate preferred shares issued by these Funds than there were offers to buy. This meant that these auctions "failed to clear" and that many or all auction rate preferred shareholders who wanted to sell their shares in these auctions were unable to do so. This decline in liquidity in auction rate preferred shares did not lower the credit quality of these shares, and auction rate preferred shareholders 8 unable to sell their shares received distributions at the "maximum rate" applicable to failed auctions as calculated in accordance with the pre-established terms of the auction rate preferred shares. At the time this report was prepared, the Funds' managers could not predict when future auctions might succeed in attracting sufficient buyers for the shares offered, if ever. The Funds' managers are working diligently to refund the auction preferred shares, and have made progress in these efforts, but at present there is no assurance that these efforts will succeed. These developments generally do not affect the management or investment policies of these Funds. However, one implication of these auction failures for common shareholders is that the Funds' cost of leverage will likely be higher, at least temporarily, than it otherwise would have been had the auctions continued to be successful. As a result, the Funds' future common share earnings may be lower than they otherwise would have been. On June 11, 2008, Nuveen announced the Fund Board's approval of plans to use tender option bonds (TOBs), also known as floating rate securities, to refinance a portion of the municipal Funds' outstanding auction rate preferred shares, for which auctions have been failing for several months. This plan included an initial phase of approximately $1 billion in forty-one Funds. As of October 31, 2008, none of the Funds included in this shareholder report had issued par redemption notices for their auction rate preferred shares. On August 7, 2008, four Nuveen municipal Funds (none of which are included in this shareholder report) issued par redemption notices for all outstanding shares of their auction rate preferred shares totaling $569.9 million. These redemptions were achieved through the issuance of variable rate demand preferred shares (VRDP) in conjunction with the proceeds from the creation of TOBs. For current, up-to-date information, please visit the Nuveen CEF Auction Rate Preferred Resource Center at: http://www.nuveen.com/ResourceCenter/AuctionRatePreferred.aspx. 9 Common Share Dividend and Share Price INFORMATION During the six-month period ended October 31, 2008, there was one dividend increase in NQP, NPY, NXM and NVY, while the dividends of NQJ, NXJ and NUJ remained stable throughout the reporting period. In NNJ, however, the cost of leverage-related borrowing remained higher than in the other Funds. This impacted the incremental income available for dividends and led to one dividend cut in this Fund, effective October 2008. All of the Funds in this report seek to pay stable dividends at rates that reflect each Fund's past results and projected future performance. During certain periods, each Fund may pay dividends at a rate that may be more or less than the amount of net investment income actually earned by the Fund during the period. If a Fund has cumulatively earned more than it has paid in dividends, it holds the excess in reserve as undistributed net investment income (UNII) as part of the Fund's NAV. Conversely, if a Fund has cumulatively paid dividends in excess of its earnings, the excess constitutes negative UNII that is likewise reflected in the Fund's NAV. Each Fund will, over time, pay all of its net investment income as dividends to shareholders. As of October 31, 2008, all of the Funds in this report except NPY had negative UNII balances for financial statement purposes and positive UNII balances, based upon our best estimate, for tax purposes. NPY had a positive UNII balance for financial statement purposes and a positive UNII balance, based upon our best estimate, for tax purposes. The Funds' Board of Directors/Trustees approved an open-market share repurchase program on July 10, 2007, for NQP and NPY and on July 30, 2008, for NQJ, NNJ, NXJ, NUJ, NXM and NVY under which each Fund may repurchase up to 10% of its common shares. As of October 31, 2008, NQP and NPY had cumulatively repurchased 139,900 and 156,100 common shares, respectively, representing approximately 0.9% and 1.0% of each Fund's' total common shares outstanding, respectively. 10 As of October 31, 2008, the Funds' common share prices were trading at discounts to their common share NAVs as shown in the accompanying chart: 10/31/08 Six-Month Discount Average Discount NQJ -15.42% - 10.19% NNJ -15.09% - 10.36% NXJ -14.89% - 10.30% NUJ -10.45% - 7.06% NQP -15.17% - 12.12% NPY -17.84% - 12.91% NXM -10.63% - 9.40% NVY -16.42% - 9.79% 11 NQJ Performance OVERVIEW Nuveen New Jersey Investment Quality Municipal Fund, Inc. as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1) AAA/U.S. Guaranteed 32% AA 40% A 10% BBB 11% BB or Lower 1% N/R 6% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(3) Nov 0.0545 Dec 0.0545 Jan 0.0545 Feb 0.0545 Mar 0.0545 Apr 0.0545 May 0.0545 Jun 0.0545 Jul 0.0545 Aug 0.0545 Sep 0.0545 Oct 0.0545 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.19 13.19 13.03 12.46 12.63 12.89 13.0601 12.79 12.62 12.94 13.382 13.59 13.33 13.67 13.68 13.7 12.85 12.78 12.59 13 12.65 12.61 12.99 12.89 12.99 12.97 13.13 13.1 13.248 13.24 13.36 13.25 13.37 13.08 12.94 12.8799 12.76 12.83 12.85 12.44 12.59 12.67 12.68 12.71 12.76 12.76 12.66 12.15 11.2 10.79 8.1 9.54 10.7101 10/31/08 10.31 FUND SNAPSHOT ------------------------------------ Common Share Price $10.31 ------------------------------------ Common Share Net Asset Value $12.19 ------------------------------------ Premium/(Discount) to NAV -15.42% ------------------------------------ Market Yield 6.34% ------------------------------------ Taxable-Equivalent Yield(2) 9.41% ------------------------------------ Net Assets Applicable to Common Shares ($000) $249,796 ------------------------------------ Average Effective Maturity on Securities (Years) 15.95 ------------------------------------ Leverage-Adjusted Duration 13.22 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 2/21/91) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -19.07% -12.43% ------------------------------------ 1-Year -17.65% -12.56% ------------------------------------ 5-Year -1.94% 1.55% ------------------------------------ 10-Year 0.61% 3.66% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ Tax Obligation/Limited 22.6% ------------------------------------ Transportation 16.8% ------------------------------------ U.S. Guaranteed 14.2% ------------------------------------ Health Care 14.0% ------------------------------------ Education and Civic Organizations 10.9% ------------------------------------ Water and Sewer 5.6% ------------------------------------ Tax Obligation/General 4.8% ------------------------------------ Other 11.1% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 32.6%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (3) The Fund paid shareholders a capital gains distribution in December 2007 of $0.0299 per share. 12 NNJ Performance OVERVIEW Nuveen New Jersey Premium Income Municipal Fund, Inc. as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1),(2) AAA/U.S. Guaranteed 33% AA 42% A 12% BBB 9% BB or Lower 1% N/R 3% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(4) Nov 0.0545 Dec 0.0545 Jan 0.0545 Feb 0.0545 Mar 0.0545 Apr 0.0545 May 0.0545 Jun 0.0545 Jul 0.0545 Aug 0.0545 Sep 0.0545 Oct 0.0515 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.6 13.52 13.27 12.95 12.92 13.196 13.35 13.34 13.05 13.3 13.85 14.08 13.71 14.1 13.96 14.05 13.3 13.14 13.12 13.21 12.97 13.09 13.14 13.3 13.28 13.34 13.48 13.48 13.6 13.58 13.64 13.61 13.597 13.21 13.01 13.01 13 13.07 12.95 12.85 12.78 12.977 12.97 12.8 13.14 13.12 12.85 12.86 11.75 11.15 8.24 9.78 10.85 10/31/08 10.86 FUND SNAPSHOT ------------------------------------ Common Share Price $10.86 ------------------------------------ Common Share Net Asset Value $12.79 ------------------------------------ Premium/(Discount) to NAV -15.09% ------------------------------------ Market Yield 5.69% ------------------------------------ Taxable-Equivalent Yield(3) 8.44% ------------------------------------ Net Assets Applicable to Common Shares ($000) $154,101 ------------------------------------ Average Effective Maturity on Securities (Years) 14.35 ------------------------------------ Leverage-Adjusted Duration 12.69 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 12/17/92) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -17.31% -10.59% ------------------------------------ 1-Year -15.32% -10.28% ------------------------------------ 5-Year -1.47% 1.57% ------------------------------------ 10-Year 1.82% 3.92% ------------------------------------ INDUSTRIES (as a % of total investments)(2) ------------------------------------ Tax Obligation/Limited 27.0% ------------------------------------ U.S. Guaranteed 17.2% ------------------------------------ Health Care 12.7% ------------------------------------ Transportation 12.3% ------------------------------------ Education and Civic Organizations 9.8% ------------------------------------ Water and Sewer 9.0% ------------------------------------ Tax Obligation/General 6.5% ------------------------------------ Other 5.5% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Excluding derivative transactions. (3) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 32.6%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (4) The Fund paid shareholders capital gains and net ordinary income distributions in December 2007 of $0.0413 and $0.0008 per share, respectively. 13 NXJ Performance OVERVIEW Nuveen New Jersey Dividend Advantage Municipal Fund as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1) AAA/U.S. Guaranteed 25% AA 37% A 16% BBB 16% BB or Lower 2% N/R 4% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(3) Nov 0.055 Dec 0.055 Jan 0.055 Feb 0.055 Mar 0.055 Apr 0.055 May 0.055 Jun 0.055 Jul 0.055 Aug 0.055 Sep 0.055 Oct 0.055 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.52 13.41 13.08 12.7 12.88 12.95 13.15 12.92 12.89 12.93 13.64 13.7 13.46 13.74 13.5 13.7 12.9 12.9 12.6 12.98 12.62 12.39 12.798 12.96 13.02 13 13 13.2 13.36 13.25 13.27 13.37 13.3 12.94 12.85 12.65 12.65 12.63 12.62 12.5 12.58 12.55 12.55 12.44 12.68 12.56 12.48 11.95 11.03 10.618 8.1 9.74 10.3 10/31/08 10.23 FUND SNAPSHOT ------------------------------------ Common Share Price $10.23 ------------------------------------ Common Share Net Asset Value $12.02 ------------------------------------ Premium/(Discount) to NAV -14.89% ------------------------------------ Market Yield 6.45% ------------------------------------ Taxable-Equivalent Yield(2) 9.57% ------------------------------------ Net Assets Applicable to Common Shares ($000) $79,085 ------------------------------------ Average Effective Maturity on Securities (Years) 16.01 ------------------------------------ Leverage-Adjusted Duration 14.35 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 3/27/01) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -19.78% -13.62% ------------------------------------ 1-Year -20.26% -14.28% ------------------------------------ 5-Year -1.96% 1.32% ------------------------------------ Since Inception 0.68% 3.38% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ Tax Obligation/Limited 23.2% ------------------------------------ U.S. Guaranteed 16.0% ------------------------------------ Health Care 14.4% ------------------------------------ Water and Sewer 13.3% ------------------------------------ Transportation 12.2% ------------------------------------ Education and Civic Organizations 12.0% ------------------------------------ Other 8.9% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 32.6%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (3) The Fund paid shareholders a capital gains distribution in December 2007 of $0.0269 per share. 14 NUJ Performance OVERVIEW Nuveen New Jersey Dividend Advantage Municipal Fund 2 as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1) AAA/U.S. Guaranteed 30% AA 33% A 19% BBB 12% BB or Lower 4% N/R 2% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(3) Nov 0.0575 Dec 0.0575 Jan 0.0575 Feb 0.0575 Mar 0.0575 Apr 0.0575 May 0.0575 Jun 0.0575 Jul 0.0575 Aug 0.0575 Sep 0.0575 Oct 0.0575 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.98 13.94 13.66 13.45 13.3499 13.58 13.81 13.49 13.34 13.26 13.95 14.2 13.98 14.12 14.4599 14.24 13.4999 13.27 13.05 13.2 12.99 12.99 13.34 13.45 13.43 13.49 13.51 13.6 13.6 13.7 13.96 13.87 14.35 13.5 13.4 13.4 13.059 13.42 13.26 13.01 13.04 12.98 13.15 13.25 13.57 13.55 13.18 12.85 11.9 11.2 8.25 9.78 10.8 10/31/08 10.8 FUND SNAPSHOT ------------------------------------ Common Share Price $10.80 ------------------------------------ Common Share Net Asset Value $12.06 ------------------------------------ Premium/(Discount) to NAV -10.45% ------------------------------------ Market Yield 6.39% ------------------------------------ Taxable-Equivalent Yield(2) 9.48% ------------------------------------ Net Assets Applicable to Common Shares ($000) $54,539 ------------------------------------ Average Effective Maturity on Securities (Years) 15.97 ------------------------------------ Leverage-Adjusted Duration 13.96 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 3/25/02) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -18.32% -13.79% ------------------------------------ 1-Year -18.36% -14.38% ------------------------------------ 5-Year -0.68% 1.66% ------------------------------------ Since Inception 0.98% 3.37% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ Health Care 19.4% ------------------------------------ Tax Obligation/Limited 19.0% ------------------------------------ U.S. Guaranteed 18.4% ------------------------------------ Transportation 15.4% ------------------------------------ Education and Civic Organizations 9.9% ------------------------------------ Long-Term Care 5.9% ------------------------------------ Other 12.0% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 32.6%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (3) The Fund paid shareholders a capital gains distribution in December 2007 of $0.1515 per share. 15 NQP Performance OVERVIEW Nuveen Pennsylvania Investment Quality Municipal Fund as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1) AAA/U.S. Guaranteed 40% AA 42% A 8% BBB 9% N/R 1% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share Nov 0.055 Dec 0.055 Jan 0.055 Feb 0.055 Mar 0.055 Apr 0.055 May 0.055 Jun 0.055 Jul 0.055 Aug 0.055 Sep 0.057 Oct 0.057 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.39 13.46 12.96 12.65 12.64 12.74 13.01 12.95 12.64 12.93 13.54 13.72 13.42 13.67 13.57 13.52 12.92 12.73 12.39 12.88 12.57 12.38 12.76 12.9 12.92 13.23 13.09 13.154 13.11 13.16 13.19 13.05 12.93 12.7 12.57 12.57 12.63 12.59 12.4401 12.25 12.25 12.25 12.19 12.105 12.23 12.35 12.24 11.58 10.67 10.25 7.66 9.03 10.29 10/31/08 10.286 FUND SNAPSHOT ------------------------------------ Common Share Price $10.29 ------------------------------------ Common Share Net Asset Value $12.13 ------------------------------------ Premium/(Discount) to NAV -15.17% ------------------------------------ Market Yield 6.65% ------------------------------------ Taxable-Equivalent Yield(2) 9.53% ------------------------------------ Net Assets Applicable to Common Shares ($000) $196,081 ------------------------------------ Average Effective Maturity on Securities (Years) 15.40 ------------------------------------ Leverage-Adjusted Duration 15.13 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 2/21/91) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -19.21% -13.60% ------------------------------------ 1-Year -19.51% -14.11% ------------------------------------ 5-Year -1.96% 0.58% ------------------------------------ 10-Year 0.50% 3.09% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ U.S. Guaranteed 21.4% ------------------------------------ Education and Civic Organizations 19.2% ------------------------------------ Tax Obligation/General 16.3% ------------------------------------ Health Care 8.2% ------------------------------------ Transportation 7.8% ------------------------------------ Tax Obligation/Limited 6.0% ------------------------------------ Housing/Single Family 5.6% ------------------------------------ Water and Sewer 4.1% ------------------------------------ Other 11.4% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 30.2%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. 16 NPY Performance OVERVIEW Nuveen Pennsylvania Premium Income Municipal Fund 2 as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments(1) AAA/U.S. Guaranteed 34% AA 39% A 9% BBB 11% BB or Lower 3% N/R 4% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(3) Nov 0.0495 Dec 0.0495 Jan 0.0495 Feb 0.0495 Mar 0.0495 Apr 0.0495 May 0.0495 Jun 0.0495 Jul 0.0495 Aug 0.0495 Sep 0.052 Oct 0.052 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 12.63 12.64 12.34 11.94 12.13 12.31 12.41 12.21 12.07 12.34 12.77 12.93 12.71 12.84 12.85 12.87 12.23 12.23 11.83 12.1 11.92 11.8 12.05 12.25 12.15 12.35 12.35 12.26 12.28 12.4 12.36 12.32 12.37 12.13 11.83 11.8999 12.06 11.93 11.71 11.48 11.53 11.53 11.53 11.537 11.59 11.73 11.52 11.26 10.14 9.89 7.2 8.36 9.39 10/31/08 9.35 FUND SNAPSHOT ------------------------------------ Common Share Price $9.35 ------------------------------------ Common Share Net Asset Value $11.38 ------------------------------------ Premium/(Discount) to NAV -17.84% ------------------------------------ Market Yield 6.67% ------------------------------------ Taxable-Equivalent Yield(2) 9.56% ------------------------------------ Net Assets Applicable to Common Shares ($000) $178,257 ------------------------------------ Average Effective Maturity on Securities (Years) 16.28 ------------------------------------ Leverage-Adjusted Duration 15.38 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 3/18/93) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -21.86% -15.21% ------------------------------------ 1-Year -21.85% -16.57% ------------------------------------ 5-Year -3.28% -0.04% ------------------------------------ 10-Year 1.96% 3.07% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ U.S. Guaranteed 15.4% ------------------------------------ Education and Civic Organizations 15.1% ------------------------------------ Transportation 12.8% ------------------------------------ Tax Obligation/General 10.6% ------------------------------------ Utilities 8.9% ------------------------------------ Health Care 8.7% ------------------------------------ Water and Sewer 7.8% ------------------------------------ Tax Obligation/Limited 5.8% ------------------------------------ Other 14.9% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 30.2%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (3) The Fund paid shareholders a capital gains distribution in December 2007 of $0.0439 per share. 17 NXM Performance OVERVIEW Nuveen Pennsylvania Dividend Advantage Municipal Fund as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments(1) AAA/U.S. Guaranteed 26% AA 41% A 13% BBB 10% BB or Lower 5% N/R 5% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Common Share(3) Nov 0.057 Dec 0.057 Jan 0.057 Feb 0.057 Mar 0.057 Apr 0.057 May 0.057 Jun 0.057 Jul 0.057 Aug 0.057 Sep 0.0585 Oct 0.0585 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.52 13.5006 13.43 12.93 12.95 13.1399 13.45 13.03 12.92 13.16 13.76 13.92 13.8 13.77 13.82 13.72 13.33 13.59 13.0101 13.07 12.82 13 13.3 13.2 13.27 13.63 13.79 13.7 13.96 13.85 13.65 13.58 13.48 13.1 13.06 12.99 13.1 12.94 13.24 13.05 12.78 12.67 12.51 12.51 12.67 12.84 12.61 11.84 11.476 11.56 9.43 9.63 10.69 10/31/08 10.76 FUND SNAPSHOT ------------------------------------ Common Share Price $10.76 ------------------------------------ Common Share Net Asset Value $12.04 ------------------------------------ Premium/(Discount) to NAV -10.63% ------------------------------------ Market Yield 6.52% ------------------------------------ Taxable-Equivalent Yield(2) 9.34% ------------------------------------ Net Assets Applicable to Common Shares ($000) $40,117 ------------------------------------ Average Effective Maturity on Securities (Years) 17.15 ------------------------------------ Leverage-Adjusted Duration 14.15 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 3/27/01) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -18.70% -14.66% ------------------------------------ 1-Year -16.34% -15.32% ------------------------------------ 5-Year -0.77% 0.93% ------------------------------------ Since Inception 1.92% 4.00% ------------------------------------ INDUSTRIES (as a % of total investments) ------------------------------------ Education and Civic Organizations 18.1% ------------------------------------ Health Care 14.3% ------------------------------------ Long-Term Care 11.5% ------------------------------------ U.S. Guaranteed 10.7% ------------------------------------ Tax Obligation/Limited 9.5% ------------------------------------ Tax Obligation/General 9.0% ------------------------------------ Transportation 7.8% ------------------------------------ Housing/Single Family 5.1% ------------------------------------ Other 14.0% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 30.2%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (3) The Fund paid shareholders a capital gains distribution in December 2007 of $0.0516 per share. 18 NVY Performance OVERVIEW Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 as of October 31, 2008 Pie Chart: Credit Quality (as a % of total investments)(1),(2) AAA/U.S. Guaranteed 28% AA 46% A 9% BBB 8% BB or Lower 4% N/R 5% Bar Chart: 2007-2008 Monthly Tax-Free Dividends Per Share(4) Nov 0.0575 Dec 0.0575 Jan 0.0575 Feb 0.0575 Mar 0.0575 Apr 0.0575 May 0.0575 Jun 0.0575 Jul 0.0575 Aug 0.0575 Sep 0.0585 Oct 0.0585 Line Chart: Common Share Price Performance -- Weekly Closing Price 11/01/07 13.6 13.58 13.23 13.18 13.15 13.32 13.5001 13.06 13.29 13.18 13.81 14.02 14.22 14.22 14.64 14.4 13.92 14 13.2 13.7 13.17 13.16 13.42 13.68 13.48 13.52 13.64 13.51 13.82 13.85 13.58 13.59 13.58 13.04 12.82 12.78 13.06 12.71 12.69 12.78 12.76 12.56 12.51 12.63 12.7 12.82 12.86 11.85 11.05 11.139 7.8 9.73 10.17 10/31/08 10.33 FUND SNAPSHOT ------------------------------------ Common Share Price $10.33 ------------------------------------ Common Share Net Asset Value $12.36 ------------------------------------ Premium/(Discount) to NAV -16.42% ------------------------------------ Market Yield 6.80% ------------------------------------ Taxable-Equivalent Yield(3) 9.74% ------------------------------------ Net Assets Applicable to Common Shares ($000) $46,056 ------------------------------------ Average Effective Maturity on Securities (Years) 14.37 ------------------------------------ Leverage-Adjusted Duration 12.68 ------------------------------------ AVERAGE ANNUAL TOTAL RETURN (Inception 3/25/02) ------------------------------------ ON SHARE PRICE ON NAV ------------------------------------ 6-Month (Cumulative) -20.67% -12.52% ------------------------------------ 1-Year -19.85% -13.26% ------------------------------------ 5-Year -1.33% 1.39% ------------------------------------ Since Inception 0.28% 3.53% ------------------------------------ INDUSTRIES (as a % of total investments)(2) ------------------------------------ U.S. Guaranteed 21.1% ------------------------------------ Tax Obligation/Limited 15.8% ------------------------------------ Tax Obligation/General 13.9% ------------------------------------ Education and Civic Organizations 12.3% ------------------------------------ Health Care 9.6% ------------------------------------ Water and Sewer 5.8% ------------------------------------ Long-Term Care 4.4% ------------------------------------ Industrials 4.1% ------------------------------------ Other 13.0% ------------------------------------ (1) The percentages shown in the foregoing chart may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (2) Excluding derivative transactions. (3) Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 30.2%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower. (4) The Fund paid shareholders a capital gains distribution in December 2007 of $0.0487 per share. 19 NQJ Nuveen New Jersey Investment Quality Municipal Fund, Inc. Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER DISCRETIONARY - 0.4% (0.3% OF TOTAL INVESTMENTS) Middlesex County Improvement Authority, New Jersey, Senior Revenue Bonds, Heldrich Center Hotel/Conference Center Project, Series 2005A: $ 800 5.000%, 1/01/32 1/15 at 100.00 Baa3 $ 513,720 690 5.125%, 1/01/37 1/15 at 100.00 Baa3 436,625 ------------------------------------------------------------------------------------------------------------------------------------ 1,490 Total Consumer Discretionary 950,345 ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 3.1% (2.0% OF TOTAL INVESTMENTS) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2007-1A: 4,300 4.750%, 6/01/34 6/17 at 100.00 BBB 2,367,666 10,000 5.000%, 6/01/41 6/17 at 100.00 BBB 5,404,000 ------------------------------------------------------------------------------------------------------------------------------------ 14,300 Total Consumer Staples 7,771,666 ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 17.1% (10.9% OF TOTAL INVESTMENTS) 1,000 New Jersey Economic Development Authority, Revenue Bonds, 6/15 at 100.00 AA 981,540 The Seeing Eye Inc., Series 2005, 5.000%, 12/01/24 - AMBAC Insured 2,000 New Jersey Educational Facilities Authority, Revenue Bonds, 7/13 at 100.00 N/R 1,452,840 Fairleigh Dickinson University, Series 2002D, 5.250%, 7/01/32 - ACA Insured 500 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 N/R 417,755 Fairleigh Dickinson University, Series 2004C, 5.500%, 7/01/23 1,000 New Jersey Educational Facilities Authority, Revenue Bonds, 7/17 at 100.00 BBB+ 841,920 Georgian Court University, Series 2007D, 5.000%, 7/01/27 New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2007D: 3,555 5.000%, 7/01/32 - FGIC Insured 7/17 at 100.00 A- 3,242,196 2,295 5.000%, 7/01/39 - FGIC Insured 7/17 at 100.00 A- 2,012,371 120 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 AA 114,266 Montclair State University, Series 2004L, 5.125%, 7/01/22 - MBIA Insured 1,225 New Jersey Educational Facilities Authority, Revenue Bonds, 7/15 at 100.00 A2 1,227,671 Montclair State University, Series 2005F, 5.000%, 7/01/16 - FGIC Insured 2,770 New Jersey Educational Facilities Authority, Revenue Bonds, 7/16 at 100.00 Aa3 2,490,812 Montclair State University, Series 2006A, 5.000%, 7/01/36 - AMBAC Insured New Jersey Educational Facilities Authority, Revenue Bonds, New Jersey Institute of Technology, Series 2001G: 1,000 5.250%, 7/01/20 - MBIA Insured 7/11 at 100.00 AA 1,003,130 1,945 5.250%, 7/01/21 - MBIA Insured 7/11 at 100.00 AA 1,943,074 New Jersey Educational Facilities Authority, Revenue Bonds, New Jersey Institute of Technology, Series 2004B: 1,260 5.000%, 7/01/19 - AMBAC Insured 1/14 at 100.00 AA 1,265,897 2,510 4.750%, 7/01/20 - AMBAC Insured 1/14 at 100.00 AA 2,435,453 185 4.250%, 7/01/24 - AMBAC Insured 1/14 at 100.00 AA 159,372 1,495 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 A- 1,508,111 Ramapo College, Series 2004H, 5.000%, 7/01/16 - FGIC Insured 610 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 A3 562,573 Rider University, Series 2004A, 5.500%, 7/01/23 - RAAI Insured 20 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) $ 510 New Jersey Educational Facilities Authority, Revenue Bonds, 7/12 at 100.00 A3 $ 396,918 Rider University, Series 2007C, 5.000%, 7/01/37 - RAAI Insured 1,430 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 AA 1,350,249 William Paterson University, Series 2004A, 5.125%, 7/01/21 - FGIC Insured 1,050 New Jersey Educational Facilities Authority, Revenue 7/12 at 100.00 A3 998,823 Refunding Bonds, Rider University, Series 2002A, 5.000%, 7/01/17 - RAAI Insured 2,115 New Jersey Higher Education Assistance Authority, 12/08 at 101.00 Aaa 2,117,030 Student Loan Revenue Bonds, New Jersey Class Loan Program, Series 1997A, 5.800%, 6/01/16 - MBIA Insured (Alternative Minimum Tax) 2,000 New Jersey Higher Education Assistance Authority, Student 6/10 at 101.00 Aaa 2,010,380 Loan Revenue Bonds, Series 2000A, 6.125%, 6/01/17 - MBIA Insured (Alternative Minimum Tax) 2,000 New Jersey Higher Education Assistance Authority, Student 6/18 at 100.00 AAA 1,829,460 Loan Revenue Bonds, Series 2008A, 6.125%, 6/01/30 - AGC Insured (Alternative Minimum Tax) 4,235 Puerto Rico Industrial, Tourist, Educational, Medical and 9/11 at 100.00 BBB 3,559,729 Environmental Control Facilities Financing Authority, Higher Education Revenue Bonds, University of the Sacred Heart, Series 2001, 5.250%, 9/01/21 University of Medicine and Dentistry of New Jersey, Certificates of Participation, Child Health Institute, LLC, Series 2003: 1,945 5.000%, 4/15/20 - AMBAC Insured 4/13 at 100.00 AA 1,816,494 1,370 5.000%, 4/15/22 - AMBAC Insured 4/13 at 100.00 AA 1,330,777 University of Medicine and Dentistry of New Jersey, Revenue Bonds, Series 2002A: 2,100 5.000%, 12/01/24 - AMBAC Insured 12/12 at 100.00 AA 2,010,372 4,000 5.500%, 12/01/27 - AMBAC Insured 12/12 at 100.00 AA 3,659,760 ------------------------------------------------------------------------------------------------------------------------------------ 46,225 Total Education and Civic Organizations 42,738,973 ------------------------------------------------------------------------------------------------------------------------------------ FINANCIALS - 1.6% (1.0% OF TOTAL INVESTMENTS) 5,000 New Jersey Economic Development Authority, Revenue No Opt. Call Baa3 3,999,100 Refunding Bonds, Kapkowski Road Landfill Project, Series 2002, 5.750%, 10/01/21 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 21.9% (14.0% OF TOTAL INVESTMENTS) Camden County Improvement Authority, New Jersey, Revenue Bonds, Cooper Health System, Series 2004A: 200 5.000%, 2/15/25 2/15 at 100.00 BBB 153,248 1,000 5.750%, 2/15/34 8/14 at 100.00 BBB 820,210 1,920 New Jersey Health Care Facilities Finance Authority, 7/18 at 100.00 A+ 1,619,251 Revenue Bonds, AHS Hospital Corporation, Series 2008A, 5.000%, 7/01/27 5,750 New Jersey Health Care Facilities Financing Authority, 8/11 at 100.00 AA 5,002,960 FHA-Insured Mortgage Revenue Bonds, Jersey City Medical Center, Series 2001, 5.000%, 8/01/41 - AMBAC Insured 2,000 New Jersey Health Care Facilities Financing Authority, 7/18 at 100.00 Baa2 1,555,100 New Jersey, Revenue Bonds, Saint Peters University Hospital, Series 2007, 5.750%, 7/01/37 3,750 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 A+ 2,876,138 Revenue Bonds, Atlanticare Regional Medical Center, Series 2007, 5.000%, 7/01/37 2,840 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa1 2,199,892 Revenue Bonds, Capital Health System Obligated Group, Series 2003A, 5.375%, 7/01/33 1,265 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 Aaa 1,118,222 Revenue Bonds, CentraState Medical Center, Series 2006A, 5.000%, 7/01/30 - AGC Insured 400 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 Baa3 307,576 Revenue Bonds, Children's Specialized Hospital, Series 2005A, 5.500%, 7/01/36 650 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 504,270 Revenue Bonds, Hunterdon Medical Center, Series 2006B, 5.000%, 7/01/36 615 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 494,343 Revenue Bonds, Hunterdon Medical Center, Series 2006, 5.125%, 7/01/35 21 NQJ Nuveen New Jersey Investment Quality Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) $ 3,000 New Jersey Health Care Facilities Financing Authority, 7/11 at 100.00 A2 $ 2,814,810 Revenue Bonds, Kennedy Health System Obligated Group, Series 2001, 5.500%, 7/01/21 3,500 New Jersey Health Care Facilities Financing Authority, 7/09 at 101.00 AAA 2,737,000 Revenue Bonds, Meridian Health System Obligated Group, Series 1999, 5.250%, 7/01/29 - FSA Insured New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Robert Wood Johnson University Hospital, Series 2000: 3,850 5.750%, 7/01/25 7/10 at 100.00 A2 3,621,695 2,000 5.750%, 7/01/31 7/10 at 100.00 A2 1,846,500 1,600 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 BBB+ 1,139,952 Revenue Bonds, RWJ Health Care Corporation, Series 2005B, 5.000%, 7/01/35 - RAAI Insured 1,885 New Jersey Health Care Facilities Financing Authority, 1/17 at 100.00 Baa2 1,388,925 Revenue Bonds, Saint Barnabas Health Care System, Series 2006A, 5.000%, 7/01/29 2,850 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 BBB+ 2,322,095 Revenue Bonds, Shore Memorial Health System, Series 2003, 5.000%, 7/01/23 - RAAI Insured 5,040 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 AA 3,928,226 Revenue Bonds, Society of the Valley Hospital Obligated Group, Series 2000, 5.375%, 7/01/31 - AMBAC Insured 3,300 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Ba2 1,911,525 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/33 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, South Jersey Hospital System, Series 2006: 2,160 5.000%, 7/01/36 7/16 at 100.00 A3 1,699,121 1,965 5.000%, 7/01/46 7/16 at 100.00 A3 1,475,892 2,000 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 Baa2 1,978,460 Revenue Bonds, St. Peter's University Hospital, Series 2000A, 6.875%, 7/01/20 3,135 New Jersey Health Care Facilities Financing Authority, 1/12 at 100.00 BBB+ 2,326,766 Revenue Refunding Bonds, Bayshore Community Hospital, Series 2002, 5.125%, 7/01/32 - RAAI Insured 2,605 New Jersey Health Care Facilities Financing Authority, 1/09 at 101.00 A2 2,232,251 Revenue Refunding Bonds, St. Barnabas Healthcare System - West Hudson Hospital Obligated Group, Series 1998A, 5.000%, 7/01/23 - MBIA Insured 3,600 New Jersey Health Facilities Financing Authority, Revenue 7/18 at 100.00 AAA 3,241,044 Bonds, Meridian Health, Series 2007-I, 5.000%, 7/01/38 - AGC Insured 3,700 Newark, New Jersey, GNMA Collateralized Healthcare 6/12 at 102.00 Aaa 3,463,015 Facility Revenue Bonds, New Community Urban Renewal Corporation, Series 2001A, 5.200%, 6/01/30 ------------------------------------------------------------------------------------------------------------------------------------ 66,580 Total Health Care 54,778,487 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 1.2% (0.8% OF TOTAL INVESTMENTS) 500 Long Branch Housing Finance Corporation New Jersey, 4/09 at 100.00 N/R 501,775 Housing Revenue Bonds, Washington Manor Associates Ltd. Section 8 Assisted Elderly Project, Series 1980, 10.000%, 10/01/11 2,743 Newark Housing Authority, New Jersey, GNMA Collateralized 10/09 at 102.00 Aaa 2,531,475 Housing Revenue Bonds, Fairview Apartments Project, Series 2000A, 6.400%, 10/20/34 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 3,243 Total Housing/Multifamily 3,033,250 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 3.6% (2.3% OF TOTAL INVESTMENTS) 2,545 New Jersey Housing and Mortgage Finance Agency, 4/09 at 100.75 Aaa 2,257,542 Home Buyer Program Revenue Bonds, Series 1997U, 5.850%, 4/01/29 - MBIA Insured (Alternative Minimum Tax) 2,085 New Jersey Housing and Mortgage Finance Agency, 10/10 at 100.00 Aaa 2,085,334 Home Buyer Program Revenue Bonds, Series 2000CC, 5.875%, 10/01/31 - MBIA Insured (Alternative Minimum Tax) 350 New Jersey Housing and Mortgage Finance Agency, 4/17 at 100.00 AA 238,511 Single Family Housing Revenue Bonds, Series 2007T, 4.700%, 10/01/37 (Alternative Minimum Tax) 2,545 Puerto Rico Housing Finance Corporation, Mortgage-Backed 6/11 at 100.00 AAA 2,249,576 Securities Home Mortgage Revenue Bonds, Series 2001A, 5.200%, 12/01/33 22 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY (continued) $ 2,545 Puerto Rico Housing Finance Corporation, Mortgage-Backed 6/11 at 100.00 AAA $ 2,147,191 Securities Home Mortgage Revenue Bonds, Series 2001B, 5.300%, 12/01/28 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 10,070 Total Housing/Single Family 8,978,154 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 0.4% (0.3% OF TOTAL INVESTMENTS) 980 Gloucester County Improvement Authority, New Jersey, No Opt. Call BBB 983,763 Solid Waste Resource Recovery Revenue Refunding Bonds, Waste Management Inc. Project, Series 1999B, 6.850%, 12/01/29 (Mandatory put 12/01/09) ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 2.9% (1.8% OF TOTAL INVESTMENTS) 1,870 Burlington County Bridge Commission, New Jersey, 1/18 at 100.00 N/R 1,266,084 Economic Development Revenue Bonds, The Evergreens Project, Series 2007, 5.625%, 1/01/38 1,125 New Jersey Economic Development Authority, First Mortgage 11/14 at 100.00 N/R 955,395 Revenue Bonds, Winchester Gardens at Wards Homestead, Series 2004A, 5.750%, 11/01/24 2,800 New Jersey Economic Development Authority, GNMA 12/11 at 103.00 Aaa 2,557,296 Collateralized Mortgage Revenue Bonds, Victoria Health Corporation, Series 2001A, 5.200%, 12/20/36 595 New Jersey Economic Development Authority, Revenue 6/11 at 102.00 A- 598,356 Bonds, Masonic Charity Foundation of New Jersey, Series 2001, 5.875%, 6/01/18 1,100 New Jersey Economic Development Authority, Revenue 6/13 at 102.00 A- 945,824 Bonds, Masonic Charity Foundation of New Jersey, Series 2002, 5.250%, 6/01/32 1,000 New Jersey Health Care Facilities Financing Authority, 7/11 at 100.00 BBB+ 850,110 Revenue Bonds, House of the Good Shepherd Obligated Group, Series 2001, 5.100%, 7/01/21 - RAAI Insured ------------------------------------------------------------------------------------------------------------------------------------ 8,490 Total Long-Term Care 7,173,065 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 7.6% (4.8% OF TOTAL INVESTMENTS) Clifton, New Jersey, General Obligation Bonds, Series 2002: 1,700 5.000%, 1/15/21 - FGIC Insured 1/11 at 100.00 AA 1,699,881 1,625 5.000%, 1/15/22 - FGIC Insured 1/11 at 100.00 AA 1,614,031 4,300 Jersey City, New Jersey, General Obligation Bonds, 9/16 at 100.00 AA 4,232,275 Series 2006A, 5.000%, 9/01/22 - AMBAC Insured 1,500 Middletown Township Board of Education, Monmouth 8/10 at 100.00 AAA 1,431,375 County, New Jersey, Refunding School Bonds, Series 2001, 5.000%, 8/01/27 - FSA Insured 5,000 New Jersey, General Obligation Bonds, Series 1992D, No Opt. Call AA 5,336,050 6.000%, 2/15/11 915 Ocean City Board of Education, Cape May County, 4/16 at 100.00 Aa2 928,725 New Jersey, General Obligation Bonds, Series 2005, 5.000%, 4/01/20 - MBIA Insured West Deptford Township, New Jersey, General Obligation Bonds, Series 2004: 1,690 5.000%, 9/01/16 - AMBAC Insured 9/14 at 100.00 Aa3 1,749,218 1,865 4.750%, 9/01/18 - AMBAC Insured 9/14 at 100.00 Aa3 1,871,192 ------------------------------------------------------------------------------------------------------------------------------------ 18,595 Total Tax Obligation/General 18,862,747 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 35.4% (22.6% OF TOTAL INVESTMENTS) 1,775 Bergen County Improvement Authority, New Jersey, No Opt. Call Aaa 1,793,939 Guaranteed Lease Revenue Bonds, County Administration Complex Project, Series 2005, 5.000%, 11/15/26 1,965 Essex County Improvement Authority, New Jersey, No Opt. Call Aa3 1,992,314 Project Consolidation Revenue Bonds, Series 2007, 5.250%, 12/15/22 - AMBAC Insured 2,650 Garden State Preservation Trust, New Jersey, No Opt. Call AAA 2,778,287 Open Space and Farmland Preservation Bonds, Series 2005C, 5.125%, 11/01/18 - FSA Insured Gloucester County Improvement Authority, New Jersey, Lease Revenue Bonds, Series 2005A: 1,000 5.000%, 9/01/21 - MBIA Insured 9/15 at 100.00 AA+ 1,007,820 1,420 5.000%, 9/01/22 - MBIA Insured 9/15 at 100.00 AA+ 1,427,242 23 NQJ Nuveen New Jersey Investment Quality Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) Hudson County Improvement Authority, New Jersey, County Secured Lease Revenue Bonds, County Services Building Project, Series 2005: $ 1,090 5.000%, 4/01/25 - AMBAC Insured 4/15 at 100.00 AA $ 1,079,122 2,525 5.000%, 4/01/35 - AMBAC Insured 4/15 at 100.00 AA 2,340,170 1,445 Lower Township Municipal Utilities Authority, Cape No Opt. Call N/R 1,445,390 May County, New Jersey, Revenue Bonds, Series 2003D, 5.000%, 12/01/16 - FGIC Insured Middlesex County Improvement Authority, New Jersey, County Guaranteed Open Space Trust Fund Revenue Bonds, Series 2003: 1,000 5.250%, 9/15/16 9/13 at 100.00 AAA 1,046,090 2,000 5.250%, 9/15/18 9/13 at 100.00 AAA 2,069,280 5,700 New Jersey Building Authority, State Building Revenue Bonds, 6/16 at 100.00 AA- 5,448,744 Series 2007A, 5.000%, 6/15/26 New Jersey Economic Development Authority, Cigarette Tax Revenue Bonds, Series 2004: 1,965 5.500%, 6/15/24 6/12 at 100.00 BBB 1,565,240 4,000 5.750%, 6/15/34 6/14 at 100.00 BBB 3,002,160 4,675 New Jersey Economic Development Authority, Lease Revenue 3/15 at 100.00 AAA 4,597,535 Bonds, Liberty State Park Project, Series 2005C, 5.000%, 3/01/27 - FSA Insured 5,000 New Jersey Economic Development Authority, Revenue 7/14 at 100.00 AA 5,264,600 Bonds, Motor Vehicle Surcharge, Series 2004A, 5.250%, 7/01/15 - MBIA Insured New Jersey Economic Development Authority, Revenue Bonds, Newark Downtown District Management Corporation Project, Series 2007: 205 5.125%, 6/15/27 6/17 at 100.00 Baa3 158,588 345 5.125%, 6/15/37 6/17 at 100.00 Baa3 245,595 New Jersey Economic Development Authority, School Facilities Construction Financing Program Bonds, Series 2007U: 1,965 5.000%, 9/01/37 - AMBAC Insured 9/17 at 100.00 AA 1,786,716 3,930 5.000%, 9/01/37 9/17 at 100.00 AA- 3,573,431 1,925 New Jersey Educational Facilities Authority, Revenue No Opt. Call AAA 2,049,182 Bonds, Higher Education Capital Improvement Fund, Series 2005A, 5.000%, 9/01/15 - FSA Insured 2,500 New Jersey Health Care Facilities Financing Authority, 9/13 at 100.00 AA- 2,210,175 Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2003, 5.000%, 9/15/25 New Jersey Health Care Facilities Financing Authority, Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2005: 2,885 5.000%, 9/15/18 - AMBAC Insured 9/15 at 100.00 AA 2,883,038 4,455 5.000%, 9/15/24 - AMBAC Insured 9/15 at 100.00 AA 4,229,933 850 New Jersey Health Care Facilities Financing Authority, 10/18 at 100.00 AA- 738,608 State Contract Bonds, Hospital Asset Transformation Program, Series 2008A, 5.250%, 10/01/38 3,405 New Jersey Transit Corporation, Lease Appropriation Bonds, 9/15 at 100.00 A2 3,353,755 Series 2005A, 5.000%, 9/15/18 - FGIC Insured New Jersey Transportation Trust Fund Authority, Federal Highway Aid Grant Anticipation Bonds, Series 2006: 1,075 5.000%, 6/15/17 - FGIC Insured 6/16 at 100.00 A1 1,095,952 1,900 5.000%, 6/15/18 - FGIC Insured 6/16 at 100.00 A1 1,912,825 4,200 New Jersey Transportation Trust Fund Authority, No Opt. Call AA 4,507,398 Transportation System Bonds, Series 2004B, 5.500%, 12/15/16 - MBIA Insured 3,890 New Jersey Transportation Trust Fund Authority, 6/15 at 100.00 AAA 3,902,176 Transportation System Bonds, Series 2005D, 5.000%, 6/15/19 - FSA Insured 4,300 New Jersey Transportation Trust Fund Authority, No Opt. Call AA- 4,384,452 Transportation System Bonds, Series 2006A, 5.500%, 12/15/22 New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2006C: 13,755 0.000%, 12/15/28 - AMBAC Insured No Opt. Call AA 4,178,219 10,000 0.000%, 12/15/32 - FSA Insured No Opt. Call AAA 2,372,400 15,310 0.000%, 12/15/34 - FSA Insured No Opt. Call AAA 3,184,633 24 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) $ 2,500 New Jersey Transportation Trust Fund Authority, 12/17 at 100.00 AA $ 2,374,075 Transportation System Bonds, Series 2007A, 5.000%, 12/15/26 - AMBAC Insured 1,625 Passaic County Improvement Authority, New Jersey, 5/15 at 100.00 Aa3 1,468,269 Lease Revenue Bonds, Preakness Healthcare Center Project, Series 2005, 5.000%, 5/01/30 - AMBAC Insured 1,315 Puerto Rico Convention Center District Authority, Hotel 7/16 at 100.00 BBB+ 965,894 Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 - CIFG Insured ------------------------------------------------------------------------------------------------------------------------------------ 120,545 Total Tax Obligation/Limited 88,433,247 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 26.3% (16.8% OF TOTAL INVESTMENTS) 2,250 Casino Reinvestment Development Authority, New Jersey, 6/15 at 100.00 AA 2,145,645 Parking Revenue Bonds, Series 2005A, 5.250%, 6/01/20 - MBIA Insured Delaware River and Bay Authority, Delaware and New Jersey, Revenue Bonds, Series 2005: 2,000 5.000%, 1/01/25 - MBIA Insured 1/15 at 100.00 AA 1,922,640 4,050 5.000%, 1/01/26 - MBIA Insured 1/15 at 100.00 AA 3,869,897 1,500 5.000%, 1/01/27 - MBIA Insured 1/15 at 100.00 AA 1,425,990 3,500 Delaware River Port Authority, New Jersey and Pennsylvania, 1/10 at 100.00 AAA 3,554,110 Revenue Bonds, Series 1999, 5.750%, 1/01/22 - FSA Insured 2,960 Delaware River Port Authority, Pennsylvania and 1/12 at 100.00 AAA 2,853,292 New Jersey, Revenue Refunding Bonds, Port District Project, Series 2001A, 5.200%, 1/01/27 - FSA Insured 3,000 New Jersey Economic Development Authority, Revenue 11/08 at 100.00 CCC+ 1,263,960 Bonds, American Airlines Inc., Series 1991, 7.100%, 11/01/31 (Alternative Minimum Tax) 160 New Jersey Turnpike Authority, Revenue Bonds, Series 1991C, No Opt. Call AA 181,818 6.500%, 1/01/16 - MBIA Insured 9,500 New Jersey Turnpike Authority, Revenue Bonds, Series 2003A, 7/13 at 100.00 AA 9,387,614 5.000%, 1/01/19 - FGIC Insured 1,265 New Jersey Turnpike Authority, Revenue Bonds, Series 2005A, No Opt. Call AAA 1,252,489 5.250%, 1/01/29 - FSA Insured 7,000 Port Authority of New York and New Jersey, Consolidated 6/15 at 101.00 AA- 6,675,480 Revenue Bonds, One Hundred Fortieth Series 2005, 5.000%, 12/01/28 - SYNCORA GTY Insured 1,000 Port Authority of New York and New Jersey, Consolidated 8/17 at 100.00 AAA 747,720 Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 8.256%, 8/15/32 - FSA Insured (IF) 2,000 Port Authority of New York and New Jersey, Consolidated 1/14 at 101.00 AA- 1,851,180 Revenue Bonds, One Hundred Thirty-Fourth Series 2004, 5.000%, 7/15/34 Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Twenty-Fifth Series 2002: 2,280 5.000%, 10/15/26 - FSA Insured 4/12 at 101.00 AAA 2,138,549 5,000 5.000%, 4/15/32 - FSA Insured 4/12 at 101.00 AAA 4,699,600 Port Authority of New York and New Jersey, Special Project Bonds, JFK International Air Terminal LLC, Sixth Series 1997: 3,500 7.000%, 12/01/12 - MBIA Insured (Alternative Minimum Tax) No Opt. Call AA 3,478,720 6,605 5.750%, 12/01/22 - MBIA Insured (Alternative Minimum Tax) 12/08 at 101.00 AA 5,872,638 12,130 5.750%, 12/01/25 - MBIA Insured (Alternative Minimum Tax) 12/08 at 100.00 AA 10,501,543 2,000 South Jersey Port Corporation, New Jersey, Marine Terminal 1/13 at 100.00 A 1,799,920 Revenue Refunding Bonds, Series 2002K, 5.100%, 1/01/33 ------------------------------------------------------------------------------------------------------------------------------------ 71,700 Total Transportation 65,622,805 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 22.3% (14.2% OF TOTAL INVESTMENTS) (4) 2,500 Bergen County Improvement Authority, New Jersey, 9/12 at 101.00 N/R (4) 2,749,050 Revenue Bonds, Yeshiva Ktana of Passaic Project, Series 2002, 6.000%, 9/15/27 (Pre-refunded 9/01/12) 3,275 Delaware River and Bay Authority, Delaware and 1/10 at 101.00 AA (4) 3,440,584 New Jersey, Revenue Bonds, Series 2000A, 5.750%, 1/01/29 (Pre-refunded 1/01/10) - AMBAC Insured 1,500 New Jersey Educational Facilities Authority, Revenue 7/13 at 100.00 A- (4) 1,628,520 Bonds, Kean University, Series 2003D, 5.250%, 7/01/20 (Pre-refunded 7/01/13) - FGIC Insured 25 NQJ Nuveen New Jersey Investment Quality Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (4) (continued) $ 1,925 New Jersey Educational Facilities Authority, Revenue 7/16 at 100.00 AA (4) $ 2,076,632 Bonds, Kean University, Series 2005B, 5.000%, 7/01/30 (Pre-refunded 7/01/16) - MBIA Insured 1,380 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA (4) 1,494,664 Bonds, Montclair State University, Series 2004L, 5.125%, 7/01/22 (Pre-refunded 7/01/14) - MBIA Insured New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2005F: 2,850 5.000%, 7/01/18 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 3,071,360 1,460 5.000%, 7/01/32 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 1,573,398 2,000 New Jersey Educational Facilities Authority, Revenue 7/12 at 100.00 AA (4) 2,134,600 Bonds, New Jersey City University, Series 2002A, 5.000%, 7/01/32 (Pre-refunded 7/01/12) - AMBAC Insured 1,300 New Jersey Educational Facilities Authority, Revenue 7/13 at 100.00 A+ (4) 1,404,403 Bonds, Rowan University, Series 2003I, 5.125%, 7/01/21 (Pre-refunded 7/01/13) - FGIC Insured New Jersey Educational Facilities Authority, Revenue Bonds, Rowan University, Series 2004C: 1,195 5.000%, 7/01/20 (Pre-refunded 7/01/14) - MBIA Insured 7/14 at 100.00 AA (4) 1,286,680 1,875 5.000%, 7/01/24 (Pre-refunded 7/01/14) - MBIA Insured 7/14 at 100.00 AA (4) 2,018,850 7,860 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A3 (4) 8,571,643 Revenue Bonds, South Jersey Hospital System, Series 2002, 5.875%, 7/01/21 (Pre-refunded 7/01/12) 1,690 New Jersey Health Care Facilities Financing Authority, No Opt. Call A3 (4) 1,757,989 Revenue Bonds, St. Clare's Hospital, Series 2004A, 5.250%, 7/01/20 - RAAI Insured (ETM) New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: 170 6.500%, 1/01/16 (ETM) No Opt. Call AAA 195,843 55 6.500%, 1/01/16 - MBIA Insured (ETM) No Opt. Call AA (4) 64,293 2,505 6.500%, 1/01/16 (ETM) No Opt. Call AAA 2,795,505 1,250 Newark Housing Authority, New Jersey, Port Authority 1/14 at 100.00 AA (4) 1,354,050 Terminal Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) - MBIA Insured 7,500 Puerto Rico Infrastructure Financing Authority, Special 10/10 at 101.00 AAA 7,515,599 Obligation Bonds, Series 2000A, 5.500%, 10/01/34 Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2002: 1,180 5.750%, 6/01/32 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 1,258,482 3,000 6.000%, 6/01/37 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 3,288,030 Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: 3,050 6.125%, 6/01/24 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 3,208,295 2,625 6.375%, 6/01/32 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 2,870,385 ------------------------------------------------------------------------------------------------------------------------------------ 52,145 Total U.S. Guaranteed 55,758,855 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 4.1% (2.6% OF TOTAL INVESTMENTS) 3,500 Camden County Pollution Control Financing Authority, 12/08 at 100.00 Baa3 3,505,180 New Jersey, Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991A, 7.500%, 12/01/10 (Alternative Minimum Tax) 250 Camden County Pollution Control Financing Authority, 12/08 at 100.00 Baa3 250,488 New Jersey, Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax) 2,055 Mercer County Improvement Authority, New Jersey, 12/13 at 100.00 AA+ 2,154,380 Solid Waste Revenue Bonds, Regional Sludge Project, Series 2003, 5.000%, 12/15/14 - FGIC Insured 2,500 Salem County Pollution Control Financing Authority, 4/12 at 101.00 Baa1 1,922,100 New Jersey, Pollution Control Revenue Refunding Bonds, PSEG Power LLC Project, Series 2001A, 5.750%, 4/01/31 (Alternative Minimum Tax) 26 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES (continued) $ 3,000 Union County Utilities Authority, New Jersey, Solid Waste 12/08 at 101.00 AA $ 2,468,880 Facility Senior Lien Revenue Bonds, Ogden Martin Systems of Union Inc., Series 1998A, 5.000%, 6/01/23 - AMBAC Insured (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 11,305 Total Utilities 10,301,028 ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 8.8% (5.6% OF TOTAL INVESTMENTS) 3,000 Jersey City Municipal Utilities Authority, Hudson County, 1/09 at 102.00 AA 2,587,110 New Jersey, Sewer Revenue Bonds, Series 2001A-2, 5.200%, 7/15/21 - FGIC Insured (Alternative Minimum Tax) Lacey Municipal Utilities Authority, Ocean County, New Jersey, Water Revenue Bonds, Series 2003B: 1,750 5.000%, 12/01/17 - FGIC Insured 12/13 at 100.00 N/R 1,748,653 1,835 5.000%, 12/01/18 - FGIC Insured 12/13 at 100.00 N/R 1,836,560 1,000 5.000%, 12/01/19 - FGIC Insured 12/13 at 100.00 N/R 989,900 7,500 New Jersey Economic Development Authority, 11/08 at 100.00 N/R 7,511,174 Water Facilities Revenue Bonds, American Water Company, Series 1996, 6.000%, 5/01/36 - FGIC Insured (Alternative Minimum Tax) North Hudson Sewerage Authority, New Jersey, Sewerage Revenue Refunding Bonds, Series 2002A: 3,000 5.250%, 8/01/16 - FGIC Insured 8/12 at 100.00 N/R 3,113,520 3,000 5.250%, 8/01/18 - FGIC Insured 8/12 at 100.00 N/R 3,034,320 1,250 Ocean County Utilities Authority, New Jersey, Wastewater 1/11 at 101.00 Aa1 1,266,338 Revenue Refunding Bonds, Series 2000, 5.000%, 1/01/18 ------------------------------------------------------------------------------------------------------------------------------------ 22,335 Total Water and Sewer 22,087,575 ------------------------------------------------------------------------------------------------------------------------------------ $ 453,003 Total Investments (cost $432,751,083) - 156.7% 391,473,060 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 8.2% 20,322,871 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (64.9)% (5) (162,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $249,795,931 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 41.4%. N/R Not rated. (ETM) Escrowed to maturity. (IF) Inverse floating rate investment. See accompanying notes to financial statements. 27 NNJ Nuveen New Jersey Premium Income Municipal Fund, Inc. Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER DISCRETIONARY - 0.4% (0.2% OF TOTAL INVESTMENTS) Middlesex County Improvement Authority, New Jersey, Senior Revenue Bonds, Heldrich Center Hotel/Conference Center Project, Series 2005A: $ 480 5.000%, 1/01/32 1/15 at 100.00 Baa3 $ 308,232 415 5.125%, 1/01/37 1/15 at 100.00 Baa3 262,608 ------------------------------------------------------------------------------------------------------------------------------------ 895 Total Consumer Discretionary 570,840 ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.8% (1.8% OF TOTAL INVESTMENTS) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2007-1A: 2,520 4.750%, 6/01/34 6/17 at 100.00 BBB 1,387,562 5,300 5.000%, 6/01/41 6/17 at 100.00 BBB 2,864,120 ------------------------------------------------------------------------------------------------------------------------------------ 7,820 Total Consumer Staples 4,251,682 ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 15.0% (9.8% OF TOTAL INVESTMENTS) 1,125 New Jersey Economic Development Authority, Revenue 6/15 at 100.00 AA 1,104,233 Bonds, The Seeing Eye Inc., Series 2005, 5.000%, 12/01/24 - AMBAC Insured 500 New Jersey Educational Facilities Authority, Revenue 7/13 at 100.00 N/R 363,210 Bonds, Fairleigh Dickinson University, Series 2002D, 5.250%, 7/01/32 - ACA Insured 300 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 N/R 250,653 Fairleigh Dickinson University, Series 2004C, 5.500%, 7/01/23 New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2007D: 2,090 5.000%, 7/01/32 - FGIC Insured 7/17 at 100.00 A- 1,906,101 3,350 5.000%, 7/01/39 - FGIC Insured 7/17 at 100.00 A- 2,937,448 100 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA 98,541 Bonds, Montclair State University, Series 2004L, 5.125%, 7/01/19 - MBIA Insured 970 New Jersey Educational Facilities Authority, Revenue 7/16 at 100.00 Aa3 872,234 Bonds, Montclair State University, Series 2006A, 5.000%, 7/01/36 - AMBAC Insured New Jersey Educational Facilities Authority, Revenue Bonds, New Jersey Institute of Technology, Series 2004B: 1,375 5.000%, 7/01/18 - AMBAC Insured 1/14 at 100.00 AA 1,391,748 725 5.000%, 7/01/19 - AMBAC Insured 1/14 at 100.00 AA 728,393 1,530 4.750%, 7/01/20 - AMBAC Insured 1/14 at 100.00 AA 1,484,559 New Jersey Educational Facilities Authority, Revenue Bonds, Ramapo College, Series 2004H: 1,640 5.000%, 7/01/18 - FGIC Insured 7/14 at 100.00 A- 1,617,663 1,040 5.000%, 7/01/23 - FGIC Insured 7/14 at 100.00 A- 966,254 300 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 A3 276,675 Rider University, Series 2004A, 5.500%, 7/01/23 - RAAI Insured 1,405 New Jersey Higher Education Assistance Authority, 6/09 at 101.00 Aaa 1,333,570 Student Loan Revenue Bonds, Series 1999A, 5.250%, 6/01/18 - MBIA Insured (Alternative Minimum Tax) 985 New Jersey Higher Education Assistance Authority, 6/10 at 101.00 Aaa 994,939 Student Loan Revenue Bonds, Series 2000A, 6.000%, 6/01/15 - MBIA Insured (Alternative Minimum Tax) 2,000 New Jersey Higher Education Assistance Authority, 6/18 at 100.00 AAA 1,829,460 Student Loan Revenue Bonds, Series 2008A, 6.125%, 6/01/30 - AGC Insured (Alternative Minimum Tax) 28 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) $ 2,025 University of Medicine and Dentistry of New Jersey, 4/13 at 100.00 AA $ 1,865,592 Certificates of Participation, Child Health Institute, LLC, Series 2003, 5.000%, 4/15/21 - AMBAC Insured 1,000 University of Medicine and Dentistry of New Jersey, 6/14 at 100.00 AA 842,860 Certificates of Participation, University Housing Associates, LLC, Series 2004, 5.000%, 6/15/29 - MBIA Insured 2,750 University of Medicine and Dentistry of New Jersey, 12/12 at 100.00 AA 2,280,163 Revenue Bonds, Series 2002A, 5.000%, 12/01/31 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 25,210 Total Education and Civic Organizations 23,144,296 ------------------------------------------------------------------------------------------------------------------------------------ FINANCIALS - 0.8% (0.5% OF TOTAL INVESTMENTS) 1,500 New Jersey Economic Development Authority, Revenue No Opt. Call Baa3 1,199,730 Refunding Bonds, Kapkowski Road Landfill Project, Series 2002, 5.750%, 10/01/21 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 19.5% (12.7% OF TOTAL INVESTMENTS) Camden County Improvement Authority, New Jersey, Revenue Bonds, Cooper Health System, Series 2004A: 185 5.000%, 2/15/25 2/15 at 100.00 BBB 141,754 620 5.750%, 2/15/34 8/14 at 100.00 BBB 508,530 1,120 New Jersey Health Care Facilities Finance Authority, 7/18 at 100.00 A+ 944,563 Revenue Bonds, AHS Hospital Corporation, Series 2008A, 5.000%, 7/01/27 1,615 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 A+ 1,238,657 Revenue Bonds, Atlanticare Regional Medical Center, Series 2007, 5.000%, 7/01/37 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Capital Health System Obligated Group, Series 2003A: 750 5.000%, 7/01/26 7/13 at 100.00 Baa1 590,858 1,670 5.375%, 7/01/33 7/13 at 100.00 Baa1 1,293,599 240 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 Baa3 184,546 Revenue Bonds, Children's Specialized Hospital, Series 2005A, 5.500%, 7/01/36 2,900 New Jersey Health Care Facilities Financing Authority, 1/10 at 101.00 A3 2,709,325 Revenue Bonds, Hackensack University Medical Center, Series 2000, 6.000%, 1/01/34 700 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 543,060 Revenue Bonds, Hunterdon Medical Center, Series 2006B, 5.000%, 7/01/36 375 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 301,429 Revenue Bonds, Hunterdon Medical Center, Series 2006, 5.125%, 7/01/35 3,500 New Jersey Health Care Facilities Financing Authority, 7/11 at 100.00 A2 3,078,915 Revenue Bonds, Kennedy Health System Obligated Group, Series 2001, 5.625%, 7/01/31 1,700 New Jersey Health Care Facilities Financing Authority, 7/09 at 101.00 AAA 1,746,274 Revenue Bonds, Meridian Health System Obligated Group, Series 1999, 5.625%, 7/01/12 - FSA Insured 465 New Jersey Health Care Facilities Financing Authority, 7/12 at 101.00 BB+ 362,021 Revenue Bonds, Palisades Medical Center of New York Presbyterian Healthcare System, Series 2002, 6.625%, 7/01/31 1,000 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 BBB+ 712,470 Revenue Bonds, RWJ Health Care Corporation, Series 2005B, 5.000%, 7/01/35 - RAAI Insured 1,160 New Jersey Health Care Facilities Financing Authority, 1/17 at 100.00 Baa2 854,723 Revenue Bonds, Saint Barnabas Health Care System, Series 2006A, 5.000%, 7/01/29 1,675 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 BBB+ 1,364,740 Revenue Bonds, Shore Memorial Health System, Series 2003, 5.000%, 7/01/23 - RAAI Insured 2,000 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 AA 1,968,360 Revenue Bonds, Society of the Valley Hospital Obligated Group, Series 2000, 5.750%, 7/01/15 - AMBAC Insured 1,875 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Ba2 1,086,094 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/33 29 NNJ Nuveen New Jersey Premium Income Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) New Jersey Health Care Facilities Financing Authority, Revenue Bonds, South Jersey Hospital System, Series 2006: $ 1,245 5.000%, 7/01/36 7/16 at 100.00 A3 $ 979,354 1,155 5.000%, 7/01/46 7/16 at 100.00 A3 867,509 2,050 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 Baa2 2,027,922 Revenue Bonds, St. Peter's University Hospital, Series 2000A, 6.875%, 7/01/20 630 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A+ 588,344 Revenue Refunding Bonds, Atlantic City Medical Center, Series 2002, 5.750%, 7/01/25 1,710 New Jersey Health Care Facilities Financing Authority, 1/12 at 100.00 BBB+ 1,413,366 Revenue Refunding Bonds, Bayshore Community Hospital, Series 2002, 5.000%, 7/01/22 - RAAI Insured 2,160 New Jersey Health Facilities Financing Authority, Revenue 7/18 at 100.00 AAA 1,944,626 Bonds, Meridian Health, Series 2007-I, 5.000%, 7/01/38 - AGC Insured 2,650 Puerto Rico Industrial, Tourist, Educational, Medical and 12/08 at 100.50 A3 2,612,953 Environmental Control Facilities Financing Authority, Adjustable Rate Industrial Revenue Bonds, American Home Products Corporation, Series 1983A, 5.100%, 12/01/18 ------------------------------------------------------------------------------------------------------------------------------------ 35,150 Total Health Care 30,063,992 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 0.4% (0.2% OF TOTAL INVESTMENTS) 340 Essex County Improvement Authority, New Jersey, 11/12 at 100.00 Aaa 277,960 FNMA Enhanced Multifamily Revenue Bonds, Mount Carmel Towers, Series 2002, 4.750%, 11/01/22 (Alternative Minimum Tax) 300 Long Branch Housing Finance Corporation New Jersey, 4/09 at 100.00 N/R 301,065 Housing Revenue Bonds, Washington Manor Associates Ltd. Section 8 Assisted Elderly Project, Series 1980, 10.000%, 10/01/11 ------------------------------------------------------------------------------------------------------------------------------------ 640 Total Housing/Multifamily 579,025 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 1.7% (1.1% OF TOTAL INVESTMENTS) New Jersey Housing and Mortgage Finance Agency, Home Buyer Program Revenue Bonds, Series 1997U: 1,455 5.700%, 10/01/14 - MBIA Insured (Alternative Minimum Tax) 4/09 at 100.75 Aaa 1,456,848 385 5.850%, 4/01/29 - MBIA Insured (Alternative Minimum Tax) 4/09 at 100.75 Aaa 341,514 430 New Jersey Housing and Mortgage Finance Agency, No Opt. Call Aaa 436,596 Home Buyer Program Revenue Bonds, Series 2000CC, 4.600%, 10/01/09 - MBIA Insured 605 New Jersey Housing and Mortgage Finance Agency, 4/17 at 100.00 AA 412,283 Single Family Housing Revenue Bonds, Series 2007T, 4.700%, 10/01/37 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 2,875 Total Housing/Single Family 2,647,241 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 0.4% (0.2% OF TOTAL INVESTMENTS) 575 Gloucester County Improvement Authority, New Jersey, No Opt. Call BBB 577,208 Solid Waste Resource Recovery Revenue Refunding Bonds, Waste Management Inc. Project, Series 1999B, 6.850%, 12/01/29 (Mandatory put 12/01/09) ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 1.5% (1.0% OF TOTAL INVESTMENTS) 1,095 Burlington County Bridge Commission, New Jersey, 1/18 at 100.00 N/R 741,370 Economic Development Revenue Bonds, The Evergreens Project, Series 2007, 5.625%, 1/01/38 750 New Jersey Economic Development Authority, 11/14 at 100.00 N/R 600,480 First Mortgage Revenue Bonds, Winchester Gardens at Wards Homestead, Series 2004A, 5.800%, 11/01/31 1,000 New Jersey Economic Development Authority, Revenue 6/11 at 102.00 A- 955,370 Bonds, Masonic Charity Foundation of New Jersey, Series 2001, 5.500%, 6/01/21 ------------------------------------------------------------------------------------------------------------------------------------ 2,845 Total Long-Term Care 2,297,220 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 10.0% (6.5% OF TOTAL INVESTMENTS) 2,460 Freehold Regional High School District, Monmouth County No Opt. Call AA 2,593,307 Board of Education, New Jersey, School District Refunding Bonds, Series 2001, 5.000%, 3/01/17 - FGIC Insured 2,500 Jersey City, New Jersey, General Obligation Bonds, 9/16 at 100.00 AA 2,460,625 Series 2006A, 5.000%, 9/01/22 - AMBAC Insured 30 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) New Jersey, General Obligation Bonds, Series 1992D: $ 2,580 6.000%, 2/15/11 No Opt. Call AA $ 2,753,402 1,560 6.000%, 2/15/13 No Opt. Call AA 1,707,982 4,000 Passaic County, New Jersey, General Improvement No Opt. Call AA 4,137,840 Refunding Bonds, Series 1993, 5.125%, 9/01/12 - FGIC Insured 1,780 West Deptford Township, New Jersey, General Obligation 9/14 at 100.00 Aa3 1,803,140 Bonds, Series 2004, 4.750%, 9/01/17 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 14,880 Total Tax Obligation/General 15,456,296 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 41.5% (27.0% OF TOTAL INVESTMENTS) 1,000 Bergen County Improvement Authority, New Jersey, No Opt. Call Aaa 1,010,670 Guaranteed Lease Revenue Bonds, County Administration Complex Project, Series 2005, 5.000%, 11/15/26 5,385 Essex County Improvement Authority, New Jersey, 12/13 at 100.00 Aaa 5,490,276 Lease Revenue Bonds, Series 2003, 5.125%, 12/15/19 - FSA Insured 1,155 Essex County Improvement Authority, New Jersey, No Opt. Call Aa3 1,171,055 Project Consolidation Revenue Bonds, Series 2007, 5.250%, 12/15/22 - AMBAC Insured 1,225 Garden State Preservation Trust, New Jersey, No Opt. Call AAA 1,284,302 Open Space and Farmland Preservation Bonds, Series 2005C, 5.125%, 11/01/18 - FSA Insured Hudson County Improvement Authority, New Jersey, County Secured Lease Revenue Bonds, County Services Building Project, Series 2005: 1,185 5.000%, 4/01/25 - AMBAC Insured 4/15 at 100.00 AA 1,173,174 2,755 5.000%, 4/01/35 - AMBAC Insured 4/15 at 100.00 AA 2,553,334 1,000 Middlesex County Improvement Authority, New Jersey, 9/13 at 100.00 AAA 1,046,090 County Guaranteed Open Space Trust Fund Revenue Bonds, Series 2003, 5.250%, 9/15/16 3,450 New Jersey Building Authority, State Building Revenue Bonds, 6/16 at 100.00 AA- 3,314,243 Series 2007A, 5.000%, 6/15/25 New Jersey Economic Development Authority, Cigarette Tax Revenue Bonds, Series 2004: 1,155 5.500%, 6/15/24 6/12 at 100.00 BBB 920,027 2,540 5.750%, 6/15/34 6/14 at 100.00 BBB 1,906,372 3,200 New Jersey Economic Development Authority, Revenue 7/14 at 100.00 AA 3,369,344 Bonds, Motor Vehicle Surcharge, Series 2004A, 5.250%, 7/01/15 - MBIA Insured New Jersey Economic Development Authority, Revenue Bonds, Newark Downtown District Management Corporation Project, Series 2007: 120 5.125%, 6/15/27 6/17 at 100.00 Baa3 92,832 205 5.125%, 6/15/37 6/17 at 100.00 Baa3 145,933 New Jersey Economic Development Authority, School Facilities Construction Financing Program Bonds, Series 2007U: 1,155 5.000%, 9/01/37 - AMBAC Insured 9/17 at 100.00 AA 1,050,207 2,310 5.000%, 9/01/37 9/17 at 100.00 AA- 2,100,414 2,720 New Jersey Health Care Facilities Financing Authority, 9/13 at 100.00 AA- 2,404,670 Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2003, 5.000%, 9/15/25 New Jersey Health Care Facilities Financing Authority, Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2005: 2,615 5.000%, 9/15/24 - AMBAC Insured 9/15 at 100.00 AA 2,482,890 3,000 5.000%, 9/15/28 - AMBAC Insured 9/15 at 100.00 AA 2,789,040 500 New Jersey Health Care Facilities Financing Authority, 10/18 at 100.00 AA- 434,475 State Contract Bonds, Hospital Asset Transformation Program, Series 2008A, 5.250%, 10/01/38 1,500 New Jersey Sports and Exposition Authority, Convention No Opt. Call AA 1,462,560 Center Luxury Tax Bonds, Series 2004, 5.500%, 3/01/22 - MBIA Insured 3,000 New Jersey Transit Corporation, Certificates of No Opt. Call AA 3,165,630 Participation, Federal Transit Administration Grants, Series 2002A, 5.500%, 9/15/14 - AMBAC Insured 1,875 New Jersey Transit Corporation, Lease Appropriation 9/15 at 100.00 A2 1,846,781 Bonds, Series 2005A, 5.000%, 9/15/18 - FGIC Insured 31 NNJ Nuveen New Jersey Premium Income Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) New Jersey Transportation Trust Fund Authority, Federal Highway Aid Grant Anticipation Bonds, Series 2006: $ 400 5.000%, 6/15/17 - FGIC Insured 6/16 at 100.00 A1 $ 407,796 715 5.000%, 6/15/18 - FGIC Insured 6/16 at 100.00 A1 719,826 2,600 New Jersey Transportation Trust Fund Authority, No Opt. Call AA 2,790,294 Transportation System Bonds, Series 2004B, 5.500%, 12/15/16 - MBIA Insured 2,000 New Jersey Transportation Trust Fund Authority, 12/15 at 100.00 AA 2,050,480 Transportation System Bonds, Series 2005B, 5.250%, 12/15/18 - FGIC Insured 1,110 New Jersey Transportation Trust Fund Authority, 6/15 at 100.00 AAA 1,113,474 Transportation System Bonds, Series 2005D, 5.000%, 6/15/19 - FSA Insured 1,700 New Jersey Transportation Trust Fund Authority, No Opt. Call AA- 1,733,388 Transportation System Bonds, Series 2006A, 5.500%, 12/15/22 New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2006C: 8,090 0.000%, 12/15/28 - AMBAC Insured No Opt. Call AA 2,457,418 6,000 0.000%, 12/15/32 - FSA Insured No Opt. Call AAA 1,423,440 4,000 0.000%, 12/15/34 - FSA Insured No Opt. Call AAA 832,040 4,000 New Jersey Transportation Trust Fund Authority, 12/17 at 100.00 AA 3,798,520 Transportation System Bonds, Series 2007A, 5.000%, 12/15/26 - AMBAC Insured 780 Puerto Rico Convention Center District Authority, 7/16 at 100.00 BBB+ 572,926 Hotel Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 - CIFG Insured 2,745 Union County Improvement Authority, New Jersey, 3/13 at 100.00 Aaa 2,502,534 General Obligation Lease Revenue Bonds, Plainfield Park Madison Redevelopment Project, Series 2003, 5.000%, 3/01/34 - FSA Insured (4) 2,445 Union County Improvement Authority, New Jersey, 6/13 at 100.00 Aa1 2,432,335 General Obligation Lease Revenue Bonds, Series 2003, 5.000%, 6/15/23 ------------------------------------------------------------------------------------------------------------------------------------ 79,635 Total Tax Obligation/Limited 64,048,790 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 18.9% (12.3% OF TOTAL INVESTMENTS) 2,750 Casino Reinvestment Development Authority, New Jersey, 6/15 at 100.00 AA 2,622,455 Parking Revenue Bonds, Series 2005A, 5.250%, 6/01/20 - MBIA Insured 2,500 Delaware River and Bay Authority, Delaware and 1/15 at 100.00 AA 2,376,650 New Jersey, Revenue Bonds, Series 2005, 5.000%, 1/01/27 - MBIA Insured New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: 565 6.500%, 1/01/16 - MBIA Insured No Opt. Call AA 642,043 345 6.500%, 1/01/16 - AMBAC Insured No Opt. Call AA 392,044 5,750 New Jersey Turnpike Authority, Revenue Bonds, 7/13 at 100.00 AA 5,681,977 Series 2003A, 5.000%, 1/01/19 - FGIC Insured 2,750 Passaic County Improvement Authority, New Jersey, 4/15 at 100.00 Aaa 2,516,553 Revenue Bonds, Paterson Parking Deck Facility, Series 2005, 5.000%, 4/15/35 - FSA Insured 4,000 Port Authority of New York and New Jersey, Consolidated 6/15 at 101.00 AA- 3,814,560 Revenue Bonds, One Hundred Fortieth Series 2005, 5.000%, 12/01/28 - SYNCORA GTY Insured 585 Port Authority of New York and New Jersey, Consolidated 8/17 at 100.00 AAA 437,416 Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 8.256%, 8/15/32 - FSA Insured (IF) 1,000 Port Authority of New York and New Jersey, Consolidated 1/14 at 101.00 AA- 925,590 Revenue Bonds, One Hundred Thirty-Fourth Series 2004, 5.000%, 7/15/34 2,000 Port Authority of New York and New Jersey, Consolidated 4/12 at 101.00 AAA 1,879,840 Revenue Bonds, One Hundred Twenty-Fifth Series 2002, 5.000%, 4/15/32 - FSA Insured 8,000 Port Authority of New York and New Jersey, Special Project 12/08 at 101.00 AA 7,112,959 Bonds, JFK International Air Terminal LLC, Sixth Series 1997, 5.750%, 12/01/22 - MBIA Insured (Alternative Minimum Tax) 850 Trenton Parking Authority, Mercer County, New Jersey, 10/13 at 100.00 Baa2 752,412 Guaranteed Parking System Revenue Bonds, Series 2003, 5.000%, 10/01/24 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 31,095 Total Transportation 29,154,499 ------------------------------------------------------------------------------------------------------------------------------------ 32 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 26.4% (17.2% OF TOTAL INVESTMENTS) (5) $ 2,075 Egg Harbor Township School District, Atlantic County, 4/15 at 100.00 Aa2 (5) $ 2,241,291 New Jersey, General Obligation Bonds, Series 2005, 5.000%, 4/01/27 (Pre-refunded 4/01/15) - MBIA Insured 130 Essex County Improvement Authority, New Jersey, 12/13 at 100.00 Aaa 141,284 Lease Revenue Bonds, Series 2003, 5.125%, 12/15/19 (Pre-refunded 12/15/13) - FSA Insured Manalapan-Englishtown Regional Board of Education, New Jersey, General Obligation Bonds, Series 2003: 1,000 5.000%, 10/01/27 (Pre-refunded 10/01/13) - MBIA Insured 10/13 at 100.00 Baa1 (5) 1,079,140 1,000 5.000%, 10/01/27 (Pre-refunded 10/01/13) - MBIA Insured 10/13 at 100.00 AAA 1,079,140 2,410 New Jersey Economic Development Authority, Revenue No Opt. Call N/R (5) 2,889,952 Bonds, Yeshiva Ktana of Passaic, Series 1993, 8.000%, 9/15/18 (ETM) 595 New Jersey Educational Facilities Authority, Revenue 7/16 at 100.00 AA (5) 641,868 Bonds, Kean University, Series 2005B, 5.000%, 7/01/30 (Pre-refunded 7/01/16) - MBIA Insured 1,145 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA (5) 1,240,138 Bonds, Montclair State University, Series 2004L, 5.125%, 7/01/19 (Pre-refunded 7/01/14) - MBIA Insured 2,080 New Jersey Educational Facilities Authority, Revenue 7/15 at 100.00 A2 (5) 2,241,554 Bonds, Montclair State University, Series 2005F, 5.000%, 7/01/32 (Pre-refunded 7/01/15) - FGIC Insured 400 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA (5) 430,688 Bonds, Rowan University, Series 2004C, 5.000%, 7/01/20 (Pre-refunded 7/01/14) - MBIA Insured 3,000 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A3 (5) 3,271,620 Revenue Bonds, South Jersey Hospital System, Series 2002, 5.875%, 7/01/21 (Pre-refunded 7/01/12) 1,270 New Jersey Health Care Facilities Financing Authority, No Opt. Call A3 (5) 1,321,092 Revenue Bonds, St. Clare's Hospital, Series 2004A, 5.250%, 7/01/20 - RAAI Insured (ETM) 545 New Jersey Health Care Facilities Financing Authority, 7/10 at 101.00 BBB- (5) 594,366 Revenue Bonds, Trinitas Hospital Obligated Group, Series 2000, 7.500%, 7/01/30 (Pre-refunded 7/01/10) 4,445 New Jersey Housing and Mortgage Finance Agency, 11/08 at 100.75 Aaa 3,852,437 Multifamily Housing Revenue Bonds, Series 1997A, 5.550%, 5/01/27 - AMBAC Insured (Alternative Minimum Tax) New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: 465 6.500%, 1/01/16 (ETM) No Opt. Call AAA 535,689 195 6.500%, 1/01/16 - MBIA Insured (ETM) No Opt. Call AA (5) 227,947 120 6.500%, 1/01/16 - AMBAC Insured (ETM) No Opt. Call AA (5) 140,275 6,590 6.500%, 1/01/16 (ETM) No Opt. Call AAA 7,354,241 1,760 6.500%, 1/01/16 - AMBAC Insured (ETM) No Opt. Call AAA 1,964,107 750 Newark Housing Authority, New Jersey, Port Authority 1/14 at 100.00 AA (5) 812,430 Terminal Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) - MBIA Insured 2,125 Puerto Rico Electric Power Authority, Power Revenue 7/15 at 100.00 AAA 2,304,414 Bonds, Series 2005RR, 5.000%, 7/01/35 (Pre-refunded 7/01/15) - FGIC Insured Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: 3,350 6.125%, 6/01/24 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 3,523,865 2,250 6.375%, 6/01/32 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 2,460,330 350 Trenton Parking Authority, Mercer County, New Jersey, 10/13 at 100.00 Baa2 (5) 377,699 Guaranteed Parking System Revenue Bonds, Series 2003, 5.000%, 10/01/24 (Pre-refunded 10/01/13) - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 38,050 Total U.S. Guaranteed 40,725,567 ------------------------------------------------------------------------------------------------------------------------------------ 33 NNJ Nuveen New Jersey Premium Income Municipal Fund, Inc. (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 0.8% (0.5% OF TOTAL INVESTMENTS) $ 1,250 New Jersey Economic Development Authority, Pollution No Opt. Call Baa1 $ 1,198,100 Control Revenue Refunding Bonds, Public Service Electric and Gas Company, Series 2001A, 5.000%, 3/01/12 ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 13.9% (9.0% OF TOTAL INVESTMENTS) Bayonne Municipal Utilities Authority, New Jersey, Water System Revenue Refunding Bonds, Series 2003A: 1,450 5.000%, 4/01/19 - SYNCORA GTY Insured 4/13 at 100.00 N/R 1,371,352 1,250 5.000%, 4/01/24 - SYNCORA GTY Insured 4/13 at 100.00 N/R 1,106,925 1,000 Jersey City Sewer Authority, Hudson County, New Jersey, No Opt. Call AA 1,068,310 Sewer Revenue Refunding Bonds, Series 1993, 6.250%, 1/01/14 - AMBAC Insured 3,100 New Jersey Economic Development Authority, 3/09 at 100.00 A2 2,802,648 Water Facilities Revenue Refunding Bonds, Hackensack Water Company, Series 1994B, 5.900%, 3/01/24 - MBIA Insured (Alternative Minimum Tax) 6,950 New Jersey Environmental Infrastructure Trust, 9/11 at 101.00 AAA 7,349,624 Environmental Infrastructure Bonds, Series 2001A, 4.750%, 9/01/20 1,650 New Jersey Water Supply Authority, Water Supply 8/15 at 100.00 AA 1,561,940 Authority Bonds, Manasquan Reservoir, Series 2005, 5.000%, 8/01/31 - MBIA Insured 3,500 North Hudson Sewerage Authority, New Jersey, 8/12 at 100.00 N/R 3,523,345 Sewerage Revenue Refunding Bonds, Series 2002A, 5.250%, 8/01/19 - FGIC Insured 1,000 Stony Brook Regional Sewer Authority, Princeton, No Opt. Call Aa2 1,040,330 New Jersey, Revenue Refunding Bonds, Series 1993B, 5.450%, 12/01/12 1,500 Wanaque Valley Regional Sewer Authority, Passaic County, No Opt. Call AA 1,564,875 New Jersey, Sewer Revenue Refunding Bonds, Series 1993B, 5.750%, 9/01/18 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 21,400 Total Water and Sewer 21,389,349 ------------------------------------------------------------------------------------------------------------------------------------ $ 263,820 Total Investments (cost $256,180,716) - 154.0% 237,303,835 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 5.4% 8,397,071 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (59.4)% (6) (91,600,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $154,100,906 ====================================================================================================================
FUTURES CONTRACTS OUTSTANDING AT OCTOBER 31, 2008: UNREALIZED CONTRACT NUMBER OF CONTRACT VALUE AT APPRECIATION TYPE POSITION CONTRACTS EXPIRATION OCTOBER 31, 2008 (DEPRECIATION) -------------------------------------------------------------------------------------------------------------------- U.S. Treasury Bond Long 49 12/08 $5,543,125 $(213,351) ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Portion of investment has been pledged to collateralize the net payment obligations under futures contracts. (5) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (6) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 38.6%. N/R Not rated. (ETM) Escrowed to maturity. (IF) Inverse floating rate investment. See accompanying notes to financial statements. 34 NXJ Nuveen New Jersey Dividend Advantage Municipal Fund Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER DISCRETIONARY - 0.4% (0.3% OF TOTAL INVESTMENTS) Middlesex County Improvement Authority, New Jersey, Senior Revenue Bonds, Heldrich Center Hotel/Conference Center Project, Series 2005A: $ 260 5.000%, 1/01/32 1/15 at 100.00 Baa3 $ 166,959 230 5.125%, 1/01/37 1/15 at 100.00 Baa3 145,542 45 New Jersey Economic Development Authority, General No Opt. Call CCC+ 24,750 Motors Corporation, Series 1984, 5.350%, 4/01/09 ------------------------------------------------------------------------------------------------------------------------------------ 535 Total Consumer Discretionary 337,251 ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 3.0% (1.9% OF TOTAL INVESTMENTS) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2007-1A: 1,345 4.750%, 6/01/34 6/17 at 100.00 BBB 740,584 3,000 5.000%, 6/01/41 6/17 at 100.00 BBB 1,621,200 ------------------------------------------------------------------------------------------------------------------------------------ 4,345 Total Consumer Staples 2,361,784 ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 18.5% (12.0% OF TOTAL INVESTMENTS) 250 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 N/R 208,878 Fairleigh Dickinson University, Series 2004C, 5.500%, 7/01/23 325 New Jersey Educational Facilities Authority, Revenue Bonds, 7/17 at 100.00 BBB+ 264,563 Georgian Court University, Series 2007D, 5.250%, 7/01/37 New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2007D: 1,115 5.000%, 7/01/32 - FGIC Insured 7/17 at 100.00 A- 1,016,891 735 5.000%, 7/01/39 - FGIC Insured 7/17 at 100.00 A- 644,485 60 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 AA 57,592 Montclair State University, Series 2004L, 5.125%, 7/01/21 - MBIA Insured 970 New Jersey Educational Facilities Authority, Revenue Bonds, 7/16 at 100.00 Aa3 872,234 Montclair State University, Series 2006A, 5.000%, 7/01/36 - AMBAC Insured 1,000 New Jersey Educational Facilities Authority, Revenue Bonds, 7/11 at 100.00 AA 1,002,860 New Jersey Institute of Technology, Series 2001G, 5.250%, 7/01/18 - MBIA Insured 1,000 New Jersey Educational Facilities Authority, Revenue Bonds, 1/14 at 100.00 AA 985,180 New Jersey Institute of Technology, Series 2004B, 5.000%, 7/01/21 - AMBAC Insured 1,085 New Jersey Educational Facilities Authority, Revenue Bonds, 7/11 at 101.00 A+ 994,099 Rowan College, Series 2001C, 5.000%, 7/01/31 - FGIC Insured 630 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA 611,818 Bonds, William Paterson University, Series 2004A, 5.125%, 7/01/19 - FGIC Insured 300 New Jersey Educational Facilities Authority, Revenue 7/12 at 100.00 A3 285,378 Refunding Bonds, Rider University, Series 2002A, 5.000%, 7/01/17 - RAAI Insured 200 New Jersey Educational Facilities Authority, Revenue 7/11 at 100.00 AA 205,056 Refunding Bonds, Seton Hall University Project, Series 2001A, 5.250%, 7/01/16 - AMBAC Insured New Jersey Educational Facilities Authority, Revenue Refunding Bonds, Seton Hall University Project, Series 2001G: 3,820 4.875%, 7/01/21 - AMBAC Insured 7/11 at 100.00 AA 3,570,860 1,600 5.000%, 7/01/26 - AMBAC Insured 7/11 at 100.00 AA 1,454,608 35 NXJ Nuveen New Jersey Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Higher Education Revenue Bonds, University of the Sacred Heart, Series 2001: $ 2,000 5.250%, 9/01/21 9/11 at 100.00 BBB $ 1,681,100 500 5.250%, 9/01/31 9/11 at 100.00 BBB 375,235 500 Puerto Rico Industrial, Tourist, Educational, Medical and 12/12 at 101.00 BBB- 369,265 Environmental Control Facilities Financing Authority, Higher Education Revenue Refunding Bonds, Ana G. Mendez University System, Series 2002, 5.500%, 12/01/31 ------------------------------------------------------------------------------------------------------------------------------------ 16,090 Total Education and Civic Organizations 14,600,102 ------------------------------------------------------------------------------------------------------------------------------------ ENERGY - 1.1% (0.7% OF TOTAL INVESTMENTS) 1,000 Virgin Islands, Senior Secured Revenue Bonds, 1/13 at 100.00 BBB 832,290 Government Refinery Facilities - Hovensa LLC Coker, Series 2002, 6.500%, 7/01/21 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ FINANCIALS - 1.8% (1.2% OF TOTAL INVESTMENTS) 850 New Jersey Economic Development Authority, Economic 11/08 at 101.00 N/R 626,977 Development Revenue Bonds, Glimcher Properties LP, Series 1998, 6.000%, 11/01/28 (Alternative Minimum Tax) 250 New Jersey Economic Development Authority, Industrial 12/08 at 100.00 Ba1 240,903 Development Revenue Refunding Bonds, Newark Airport Marriott Hotel, Series 1996, 7.000%, 10/01/14 750 New Jersey Economic Development Authority, Revenue No Opt. Call Baa3 599,865 Refunding Bonds, Kapkowski Road Landfill Project, Series 2002, 5.750%, 10/01/21 ------------------------------------------------------------------------------------------------------------------------------------ 1,850 Total Financials 1,467,745 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 22.2% (14.4% OF TOTAL INVESTMENTS) 310 Camden County Improvement Authority, New Jersey, 8/14 at 100.00 BBB 254,265 Revenue Bonds, Cooper Health System, Series 2004A, 5.750%, 2/15/34 560 New Jersey Health Care Facilities Finance Authority, 7/18 at 100.00 A+ 472,282 Revenue Bonds, AHS Hospital Corporation, Series 2008A, 5.000%, 7/01/27 865 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 A+ 663,429 Revenue Bonds, Atlanticare Regional Medical Center, Series 2007, 5.000%, 7/01/37 890 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa1 689,403 Revenue Bonds, Capital Health System Obligated Group, Series 2003A, 5.375%, 7/01/33 1,500 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 Aaa 1,325,955 Revenue Bonds, CentraState Medical Center, Series 2006A, 5.000%, 7/01/30 - AGC Insured 130 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 Baa3 99,962 Revenue Bonds, Children's Specialized Hospital, Series 2005A, 5.500%, 7/01/36 400 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 310,320 Revenue Bonds, Hunterdon Medical Center, Series 2006B, 5.000%, 7/01/36 180 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 144,686 Revenue Bonds, Hunterdon Medical Center, Series 2006, 5.125%, 7/01/35 3,500 New Jersey Health Care Facilities Financing Authority, 7/11 at 100.00 A2 3,078,915 Revenue Bonds, Kennedy Health System Obligated Group, Series 2001, 5.625%, 7/01/31 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Robert Wood Johnson University Hospital, Series 2000: 750 5.750%, 7/01/25 7/10 at 100.00 A2 705,525 3,000 5.750%, 7/01/31 7/10 at 100.00 A2 2,769,750 445 New Jersey Health Care Facilities Financing Authority, 1/17 at 100.00 Baa2 327,889 Revenue Bonds, Saint Barnabas Health Care System, Series 2006A, 5.000%, 7/01/29 895 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 BBB+ 729,219 Revenue Bonds, Shore Memorial Health System, Series 2003, 5.000%, 7/01/23 - RAAI Insured 1,000 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Ba2 579,250 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/33 36 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) New Jersey Health Care Facilities Financing Authority, Revenue Bonds, South Jersey Hospital System, Series 2006: $ 665 5.000%, 7/01/36 7/16 at 100.00 A3 $ 523,109 615 5.000%, 7/01/46 7/16 at 100.00 A3 461,920 1,100 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 Baa2 1,088,153 Revenue Bonds, St. Peter's University Hospital, Series 2000A, 6.875%, 7/01/20 2,500 New Jersey Health Care Facilities Financing Authority, 7/09 at 101.00 A2 2,191,975 Revenue Refunding Bonds, Burdette Tomlin Memorial Hospital, Series 1999, 5.500%, 7/01/29 1,280 New Jersey Health Facilities Financing Authority, 7/18 at 100.00 AAA 1,152,371 Revenue Bonds, Meridian Health, Series 2007-I, 5.000%, 7/01/38 - AGC Insured ------------------------------------------------------------------------------------------------------------------------------------ 20,585 Total Health Care 17,568,378 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 0.4% (0.3% OF TOTAL INVESTMENTS) 310 Gloucester County Improvement Authority, New Jersey, No Opt. Call BBB 311,190 Solid Waste Resource Recovery Revenue Refunding Bonds, Waste Management Inc. Project, Series 1999B, 6.850%, 12/01/29 (Mandatory put 12/01/09) ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 2.8% (1.8% OF TOTAL INVESTMENTS) 585 Burlington County Bridge Commission, New Jersey, 1/18 at 100.00 N/R 396,074 Economic Development Revenue Bonds, The Evergreens Project, Series 2007, 5.625%, 1/01/38 250 New Jersey Economic Development Authority, First 11/14 at 100.00 N/R 200,160 Mortgage Revenue Bonds, Winchester Gardens at Wards Homestead, Series 2004A, 5.800%, 11/01/31 New Jersey Economic Development Authority, Revenue Bonds, Masonic Charity Foundation of New Jersey, Series 2001: 1,000 6.000%, 6/01/25 6/11 at 102.00 A- 966,350 335 5.500%, 6/01/31 6/11 at 102.00 A- 300,696 500 New Jersey Economic Development Authority, Revenue 1/09 at 101.00 BB+ 322,040 Bonds, United Methodist Homes of New Jersey Obligated Group, Series 1998, 5.125%, 7/01/25 ------------------------------------------------------------------------------------------------------------------------------------ 2,670 Total Long-Term Care 2,185,320 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 2.8% (1.9% OF TOTAL INVESTMENTS) 1,000 Jersey City, New Jersey, General Obligation Bonds, 9/16 at 100.00 AA 984,250 Series 2006A, 5.000%, 9/01/22 - AMBAC Insured 1,350 Puerto Rico, General Obligation and Public Improvement 7/11 at 100.00 AAA 1,268,825 Bonds, Series 2001, 5.250%, 7/01/27 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 2,350 Total Tax Obligation/General 2,253,075 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 35.7% (23.2% OF TOTAL INVESTMENTS) 600 Bergen County Improvement Authority, New Jersey, No Opt. Call Aaa 606,402 Guaranteed Lease Revenue Bonds, County Administration Complex Project, Series 2005, 5.000%, 11/15/26 1,745 Burlington County Bridge Commission, New Jersey, 12/13 at 100.00 AA 1,780,214 Guaranteed Pooled Loan Bonds, Series 2003, 5.000%, 12/01/18 - MBIA Insured 1,000 Camden County Improvement Authority, New Jersey, 9/15 at 100.00 AAA 1,053,290 County Guaranteed Lease Revenue Bonds, Series 2005A, 5.000%, 9/01/16 - FSA Insured 1,100 Casino Reinvestment Development Authority, New Jersey, 1/15 at 102.00 AA 1,134,353 Hotel Room Fee Revenue Bonds, Series 2004, 5.250%, 1/01/16 - AMBAC Insured 620 Essex County Improvement Authority, New Jersey, No Opt. Call Aa3 628,618 Project Consolidation Revenue Bonds, Series 2007, 5.250%, 12/15/22 - AMBAC Insured 815 Garden State Preservation Trust, New Jersey, Open Space No Opt. Call AAA 854,454 and Farmland Preservation Bonds, Series 2005C, 5.125%, 11/01/18 - FSA Insured 1,785 New Jersey Building Authority, State Building Revenue 6/16 at 100.00 AA- 1,693,644 Bonds, Series 2007A, 5.000%, 6/15/27 37 NXJ Nuveen New Jersey Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) New Jersey Economic Development Authority, Cigarette Tax Revenue Bonds, Series 2004: $ 615 5.500%, 6/15/24 6/12 at 100.00 BBB $ 489,884 1,200 5.750%, 6/15/34 6/14 at 100.00 BBB 900,648 1,200 New Jersey Economic Development Authority, Revenue 7/14 at 100.00 AA 1,263,504 Bonds, Motor Vehicle Surcharge, Series 2004A, 5.250%, 7/01/15 - MBIA Insured New Jersey Economic Development Authority, Revenue Bonds, Newark Downtown District Management Corporation Project, Series 2007: 65 5.125%, 6/15/27 6/17 at 100.00 Baa3 50,284 115 5.125%, 6/15/37 6/17 at 100.00 Baa3 81,865 New Jersey Economic Development Authority, School Facilities Construction Financing Program Bonds, Series 2007U: 615 5.000%, 9/01/37 - AMBAC Insured 9/17 at 100.00 AA 559,201 1,235 5.000%, 9/01/37 9/17 at 100.00 AA- 1,122,948 525 New Jersey Educational Facilities Authority, Revenue No Opt. Call AAA 558,868 Bonds, Higher Education Capital Improvement Fund, Series 2005A, 5.000%, 9/01/15 - FSA Insured New Jersey Health Care Facilities Financing Authority, Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2005: 925 5.000%, 9/15/18 - AMBAC Insured 9/15 at 100.00 AA 924,371 1,400 5.000%, 9/15/24 - AMBAC Insured 9/15 at 100.00 AA 1,329,272 250 New Jersey Health Care Facilities Financing Authority, 10/18 at 100.00 AA- 217,238 State Contract Bonds, Hospital Asset Transformation Program, Series 2008A, 5.250%, 10/01/38 1,000 New Jersey Transit Corporation, Certificates of No Opt. Call AA 1,055,210 Participation, Federal Transit Administration Grants, Series 2002A, 5.500%, 9/15/14 - AMBAC Insured 1,000 New Jersey Transit Corporation, Lease Appropriation 9/15 at 100.00 A2 984,950 Bonds, Series 2005A, 5.000%, 9/15/18 - FGIC Insured New Jersey Transportation Trust Fund Authority, Federal Highway Aid Grant Anticipation Bonds, Series 2006: 350 5.000%, 6/15/17 - FGIC Insured 6/16 at 100.00 A1 356,822 610 5.000%, 6/15/18 - FGIC Insured 6/16 at 100.00 A1 614,118 1,300 New Jersey Transportation Trust Fund Authority, No Opt. Call AA 1,395,147 Transportation System Bonds, Series 2004B, 5.500%, 12/15/16 - MBIA Insured 1,280 New Jersey Transportation Trust Fund Authority, 6/15 at 100.00 AAA 1,284,006 Transportation System Bonds, Series 2005D, 5.000%, 6/15/19 - FSA Insured 1,300 New Jersey Transportation Trust Fund Authority, No Opt. Call AA- 1,325,532 Transportation System Bonds, Series 2006A, 5.500%, 12/15/22 New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2006C: 4,315 0.000%, 12/15/28 - AMBAC Insured No Opt. Call AA 1,310,724 3,000 0.000%, 12/15/32 - FSA Insured No Opt. Call AAA 711,720 6,000 0.000%, 12/15/34 - FSA Insured No Opt. Call AAA 1,248,060 1,000 New Jersey Transportation Trust Fund Authority, 12/17 at 100.00 AA 949,630 Transportation System Bonds, Series 2007A, 5.000%, 12/15/26 - AMBAC Insured 405 Puerto Rico Convention Center District Authority, 7/16 at 100.00 BBB+ 297,481 Hotel Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 - CIFG Insured 1,500 Virgin Islands Public Finance Authority, Senior Lien 4/09 at 101.00 A 1,470,765 Revenue Refunding Bonds, Matching Fund Loan Note, Series 1998A, 5.500%, 10/01/18 - RAAI Insured ------------------------------------------------------------------------------------------------------------------------------------ 38,870 Total Tax Obligation/Limited 28,253,223 ------------------------------------------------------------------------------------------------------------------------------------ 38 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 18.7% (12.2% OF TOTAL INVESTMENTS) Delaware River and Bay Authority, Delaware and New Jersey, Revenue Bonds, Series 2005: $ 1,000 5.000%, 1/01/25 - MBIA Insured 1/15 at 100.00 AA $ 961,320 1,000 5.000%, 1/01/26 - MBIA Insured 1/15 at 100.00 AA 955,530 500 5.000%, 1/01/27 - MBIA Insured 1/15 at 100.00 AA 475,330 900 New Jersey Economic Development Authority, Special 11/10 at 101.00 B 582,741 Facilities Revenue Bonds, Continental Airlines Inc., Series 2000, 7.000%, 11/15/30 (Alternative Minimum Tax) 50 New Jersey Turnpike Authority, Revenue Bonds, No Opt. Call AA 56,818 Series 1991C, 6.500%, 1/01/16 - MBIA Insured 3,000 New Jersey Turnpike Authority, Revenue Bonds, 7/13 at 100.00 AA 2,964,510 Series 2003A, 5.000%, 1/01/19 - FGIC Insured 300 New Jersey Turnpike Authority, Revenue Bonds, No Opt. Call AAA 297,033 Series 2005A, 5.250%, 1/01/29 - FSA Insured 310 Port Authority of New York and New Jersey, Consolidated 8/17 at 100.00 AAA 231,793 Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 8.256%, 8/15/32 - FSA Insured (IF) 500 Port Authority of New York and New Jersey, Consolidated 1/14 at 101.00 AA- 462,795 Revenue Bonds, One Hundred Thirty-Fourth Series 2004, 5.000%, 7/15/34 5,000 Port Authority of New York and New Jersey, Special Project 12/08 at 101.00 AA 4,445,600 Bonds, JFK International Air Terminal LLC, Sixth Series 1997, 5.750%, 12/01/22 - MBIA Insured (Alternative Minimum Tax) 3,435 South Jersey Transportation Authority New Jersey, 11/09 at 101.00 AA 3,343,045 Transportation System Revenue Bonds, Series 1999, 5.125%, 11/01/22 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 15,995 Total Transportation 14,776,515 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 24.7% (16.0% OF TOTAL INVESTMENTS) (4) 2,400 New Jersey Economic Development Authority, School 6/11 at 100.00 AAA 2,537,328 Facilities Construction Bonds, Series 2001A, 5.000%, 6/15/21 (Pre-refunded 6/15/11) - AMBAC Insured 385 New Jersey Educational Facilities Authority, Revenue 7/16 at 100.00 AA (4) 415,326 Bonds, Kean University, Series 2005B, 5.000%, 7/01/30 (Pre-refunded 7/01/16) - MBIA Insured 690 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 AA (4) 747,332 Montclair State University, Series 2004L, 5.125%, 7/01/21 (Pre-refunded 7/01/14) - MBIA Insured New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2005F: 1,200 5.000%, 7/01/17 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 1,293,204 1,000 5.000%, 7/01/24 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 1,077,670 520 5.000%, 7/01/32 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 560,388 415 New Jersey Educational Facilities Authority, Revenue 7/11 at 101.00 A+ (4) 442,859 Bonds, Rowan College, Series 2001C, 5.000%, 7/01/31 (Pre-refunded 7/01/11) - FGIC Insured 625 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 AA (4) 672,950 Rowan University, Series 2004C, 5.000%, 7/01/24 (Pre-refunded 7/01/14) - MBIA Insured 1,350 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A3 (4) 1,472,229 Revenue Bonds, South Jersey Hospital System, Series 2002, 5.875%, 7/01/21 (Pre-refunded 7/01/12) 845 New Jersey Health Care Facilities Financing Authority, No Opt. Call A3 (4) 878,994 Revenue Bonds, St. Clare's Hospital, Series 2004A, 5.250%, 7/01/20 - RAAI Insured (ETM) 500 New Jersey Health Care Facilities Financing Authority, 7/10 at 101.00 BBB- (4) 545,290 Revenue Bonds, Trinitas Hospital Obligated Group, Series 2000, 7.500%, 7/01/30 (Pre-refunded 7/01/10) New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: 130 6.500%, 1/01/16 (ETM) No Opt. Call AAA 149,763 20 6.500%, 1/01/16 - MBIA Insured (ETM) No Opt. Call AA (4) 23,379 905 6.500%, 1/01/16 (ETM) No Opt. Call AAA 1,009,953 375 Newark Housing Authority, New Jersey, Port Authority 1/14 at 100.00 AA (4) 406,215 Terminal Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) - MBIA Insured 1,500 Puerto Rico Infrastructure Financing Authority, Special 10/10 at 101.00 AAA 1,501,515 Obligation Bonds, Series 2000A, 5.500%, 10/01/40 39 NXJ Nuveen New Jersey Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (4) (continued) $ 2,150 Puerto Rico, General Obligation and Public Improvement 7/11 at 100.00 AAA $ 2,291,492 Bonds, Series 2001, 5.250%, 7/01/27 (Pre-refunded 7/01/11) - FSA Insured Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: 2,135 6.125%, 6/01/24 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 2,245,807 1,125 6.375%, 6/01/32 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,230,165 ------------------------------------------------------------------------------------------------------------------------------------ 18,270 Total U.S. Guaranteed 19,501,859 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 1.2% (0.8% OF TOTAL INVESTMENTS) 210 Camden County Pollution Control Financing Authority, 12/08 at 100.00 Baa3 210,410 New Jersey, Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax) 750 New Jersey Economic Development Authority, Pollution No Opt. Call Baa1 718,860 Control Revenue Refunding Bonds, Public Service Electric and Gas Company, Series 2001A, 5.000%, 3/01/12 ------------------------------------------------------------------------------------------------------------------------------------ 960 Total Utilities 929,270 ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 20.4% (13.3% OF TOTAL INVESTMENTS) 225 Guam Government Waterworks Authority, Water and 7/15 at 100.00 Ba2 181,640 Wastewater System Revenue Bonds, Series 2005, 6.000%, 7/01/25 4,635 New Jersey Economic Development Authority, 11/08 at 102.00 N/R 3,702,902 Water Facilities Revenue Bonds, American Water Company, Series 1997B, 5.375%, 5/01/32 - FGIC Insured (Alternative Minimum Tax) 7,000 New Jersey Economic Development Authority, 2/09 at 101.00 AA 5,373,970 Water Facilities Revenue Bonds, Middlesex Water Company, Series 1998, 5.350%, 2/01/38 - MBIA Insured (Alternative Minimum Tax) 390 New Jersey Environmental Infrastructure Trust, 3/09 at 101.00 AAA 390,612 Environmental Infrastructure Bonds, Series 1998A, 4.500%, 9/01/18 15,840 North Hudson Sewerage Authority, New Jersey, No Opt. Call Baa1 6,528,929 Sewerage Revenue Refunding Bonds, Series 2001A, 0.000%, 8/01/23 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ 28,090 Total Water and Sewer 16,178,053 ------------------------------------------------------------------------------------------------------------------------------------ $ 151,920 Total Investments (cost $136,372,034) - 153.7% 121,556,055 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 7.0% 5,528,770 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (60.7)% (5) (48,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $79,084,825 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 39.5%. N/R Not rated. (ETM) Escrowed to maturity. (IF) Inverse floating rate investment. See accompanying notes to financial statements. 40 NUJ Nuveen New Jersey Dividend Advantage Municipal Fund 2 Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER DISCRETIONARY - 0.4% (0.3% OF TOTAL INVESTMENTS) Middlesex County Improvement Authority, New Jersey, Senior Revenue Bonds, Heldrich Center Hotel/Conference Center Project, Series 2005A: $ 180 5.000%, 1/01/32 1/15 at 100.00 Baa3 $ 115,587 150 5.125%, 1/01/37 1/15 at 100.00 Baa3 94,919 40 New Jersey Economic Development Authority, General No Opt. Call CCC+ 22,000 Motors Corporation, Series 1984, 5.350%, 4/01/09 ------------------------------------------------------------------------------------------------------------------------------------ 370 Total Consumer Discretionary 232,506 ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 3.2% (2.0% OF TOTAL INVESTMENTS) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2007-1A: 950 4.750%, 6/01/34 6/17 at 100.00 BBB 523,089 2,200 5.000%, 6/01/41 6/17 at 100.00 BBB 1,188,880 ------------------------------------------------------------------------------------------------------------------------------------ 3,150 Total Consumer Staples 1,711,969 ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 15.7% (9.9% OF TOTAL INVESTMENTS) 3,000 New Jersey Educational Facilities Authority, Revenue Bonds, 7/12 at 100.00 AA 2,823,509 College of New Jersey Project, Series 2002C, 4.750%, 7/01/19 - FGIC Insured 200 New Jersey Educational Facilities Authority, Revenue Bonds, 7/14 at 100.00 N/R 167,102 Fairleigh Dickinson University, Series 2004C, 5.500%, 7/01/23 New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2007D: 790 5.000%, 7/01/32 - FGIC Insured 7/17 at 100.00 A- 720,488 495 5.000%, 7/01/39 - FGIC Insured 7/17 at 100.00 A- 434,041 575 New Jersey Educational Facilities Authority, Revenue 1/14 at 100.00 AA 566,479 Bonds, New Jersey Institute of Technology, Series 2004B, 5.000%, 7/01/21 - AMBAC Insured 500 New Jersey Educational Facilities Authority, Revenue 7/14 at 100.00 AA 485,570 Bonds, William Paterson University, Series 2004A, 5.125%, 7/01/19 - FGIC Insured 1,090 New Jersey Educational Facilities Authority, Revenue 7/12 at 100.00 A3 1,036,873 Refunding Bonds, Rider University, Series 2002A, 5.000%, 7/01/17 - RAAI Insured 1,000 Puerto Rico Industrial, Tourist, Educational, Medical and 2/09 at 101.00 BBB- 860,040 Environmental Control Facilities Financing Authority, Higher Education Revenue Bonds, Ana G. Mendez University System, Series 1999, 5.375%, 2/01/19 1,790 University of Medicine and Dentistry of New Jersey, 12/12 at 100.00 AA 1,484,179 Revenue Bonds, Series 2002A, 5.000%, 12/01/31 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 9,440 Total Education and Civic Organizations 8,578,281 ------------------------------------------------------------------------------------------------------------------------------------ ENERGY - 1.5% (1.0% OF TOTAL INVESTMENTS) 1,000 Virgin Islands, Senior Secured Revenue Bonds, 1/13 at 100.00 BBB 832,290 Government Refinery Facilities - Hovensa LLC Coker, Series 2002, 6.500%, 7/01/21 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ FINANCIALS - 5.2% (3.2% OF TOTAL INVESTMENTS) 600 New Jersey Economic Development Authority, 11/08 at 101.00 N/R 442,572 Economic Development Revenue Bonds, Glimcher Properties LP, Series 1998, 6.000%, 11/01/28 (Alternative Minimum Tax) 41 NUJ Nuveen New Jersey Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ FINANCIALS (continued) $ 1,250 New Jersey Economic Development Authority, Industrial 12/08 at 100.00 Ba1 $ 1,204,513 Development Revenue Refunding Bonds, Newark Airport Marriott Hotel, Series 1996, 7.000%, 10/01/14 1,450 New Jersey Economic Development Authority, Revenue No Opt. Call Baa3 1,159,739 Refunding Bonds, Kapkowski Road Landfill Project, Series 2002, 5.750%, 10/01/21 ------------------------------------------------------------------------------------------------------------------------------------ 3,300 Total Financials 2,806,824 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 30.7% (19.4% OF TOTAL INVESTMENTS) 220 Camden County Improvement Authority, New Jersey, 8/14 at 100.00 BBB 180,446 Revenue Bonds, Cooper Health System, Series 2004A, 5.750%, 2/15/34 400 New Jersey Health Care Facilities Finance Authority, 7/18 at 100.00 A+ 337,344 Revenue Bonds, AHS Hospital Corporation, Series 2008A, 5.000%, 7/01/27 New Jersey Health Care Facilities Financing Authority, FHA-Insured Mortgage Revenue Bonds, Jersey City Medical Center, Series 2001: 500 5.000%, 8/01/31 - AMBAC Insured 8/11 at 100.00 AA 447,450 1,925 5.000%, 8/01/41 - AMBAC Insured 8/11 at 100.00 AA 1,674,904 610 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 A+ 467,852 Revenue Bonds, Atlanticare Regional Medical Center, Series 2007, 5.000%, 7/01/37 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Capital Health System Obligated Group, Series 2003A: 750 5.000%, 7/01/26 7/13 at 100.00 Baa1 590,858 630 5.375%, 7/01/33 7/13 at 100.00 Baa1 488,004 1,000 New Jersey Health Care Facilities Financing Authority, 7/17 at 100.00 Aaa 883,970 Revenue Bonds, CentraState Medical Center, Series 2006A, 5.000%, 7/01/30 - AGC Insured 90 New Jersey Health Care Facilities Financing Authority, 7/15 at 100.00 Baa3 69,205 Revenue Bonds, Children's Specialized Hospital, Series 2005A, 5.500%, 7/01/36 120 New Jersey Health Care Facilities Financing Authority, 7/16 at 100.00 A- 96,457 Revenue Bonds, Hunterdon Medical Center, Series 2006, 5.125%, 7/01/35 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Kennedy Health System Obligated Group, Series 2001: 400 5.500%, 7/01/21 7/11 at 100.00 A2 375,308 140 5.625%, 7/01/31 7/11 at 100.00 A2 123,157 510 New Jersey Health Care Facilities Financing Authority, 7/09 at 101.00 Aaa 398,820 Revenue Bonds, Meridian Health System Obligated Group, Series 1999, 5.250%, 7/01/29 - FSA Insured 1,185 New Jersey Health Care Facilities Financing Authority, 7/12 at 101.00 BB+ 922,570 Revenue Bonds, Palisades Medical Center of New York Presbyterian Healthcare System, Series 2002, 6.625%, 7/01/31 3,500 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 A2 3,231,374 Revenue Bonds, Robert Wood Johnson University Hospital, Series 2000, 5.750%, 7/01/31 630 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 BBB+ 513,305 Revenue Bonds, Shore Memorial Health System, Series 2003, 5.000%, 7/01/23 - RAAI Insured 700 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Ba2 405,475 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/33 New Jersey Health Care Facilities Financing Authority, Revenue Bonds, South Jersey Hospital System, Series 2006: 455 5.000%, 7/01/36 7/16 at 100.00 A3 357,917 435 5.000%, 7/01/46 7/16 at 100.00 A3 326,724 775 New Jersey Health Care Facilities Financing Authority, 7/10 at 100.00 Baa2 766,653 Revenue Bonds, St. Peter's University Hospital, Series 2000A, 6.875%, 7/01/20 1,390 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A+ 1,298,093 Revenue Refunding Bonds, Atlantic City Medical Center, Series 2002, 5.750%, 7/01/25 1,150 New Jersey Health Care Facilities Financing Authority, 1/12 at 100.00 BBB+ 853,519 Revenue Refunding Bonds, Bayshore Community Hospital, Series 2002, 5.125%, 7/01/32 - RAAI Insured 42 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) $ 960 New Jersey Health Facilities Financing Authority, 7/18 at 100.00 AAA $ 864,278 Revenue Bonds, Meridian Health, Series 2007-I, 5.000%, 7/01/38 - AGC Insured 1,100 Puerto Rico Industrial, Tourist, Educational, Medical 12/08 at 100.50 A3 1,084,622 and Environmental Control Facilities Financing Authority, Adjustable Rate Industrial Revenue Bonds, American Home Products Corporation, Series 1983A, 5.100%, 12/01/18 ------------------------------------------------------------------------------------------------------------------------------------ 19,575 Total Health Care 16,758,305 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 0.3% (0.2% OF TOTAL INVESTMENTS) 225 New Jersey Housing and Mortgage Finance Agency, 4/17 at 100.00 AA 153,329 Single Family Housing Revenue Bonds, Series 2007T, 4.700%, 10/01/37 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 0.4% (0.2% OF TOTAL INVESTMENTS) 220 Gloucester County Improvement Authority, New Jersey, No Opt. Call BBB 220,845 Solid Waste Resource Recovery Revenue Refunding Bonds, Waste Management Inc. Project, Series 1999B, 6.850%, 12/01/29 (Mandatory put 12/01/09) ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 9.3% (5.9% OF TOTAL INVESTMENTS) 415 Burlington County Bridge Commission, New Jersey, 1/18 at 100.00 N/R 280,976 Economic Development Revenue Bonds, The Evergreens Project, Series 2007, 5.625%, 1/01/38 New Jersey Economic Development Authority, Revenue Bonds, Masonic Charity Foundation of New Jersey, Series 2001: 1,000 5.500%, 6/01/21 6/11 at 102.00 A- 955,370 4,000 5.500%, 6/01/31 6/11 at 102.00 A- 3,590,399 375 New Jersey Economic Development Authority, Revenue 1/09 at 101.00 BB+ 241,530 Bonds, United Methodist Homes of New Jersey Obligated Group, Series 1998, 5.125%, 7/01/25 ------------------------------------------------------------------------------------------------------------------------------------ 5,790 Total Long-Term Care 5,068,275 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 1.9% (1.2% OF TOTAL INVESTMENTS) 700 Jersey City, New Jersey, General Obligation Bonds, 9/16 at 100.00 AA 688,975 Series 2006A, 5.000%, 9/01/22 - AMBAC Insured 385 Puerto Rico, General Obligation and Public Improvement 7/11 at 100.00 AAA 366,100 Bonds, Series 2001, 5.125%, 7/01/23 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 1,085 Total Tax Obligation/General 1,055,075 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 30.2% (19.0% OF TOTAL INVESTMENTS) 400 Bergen County Improvement Authority, New Jersey, No Opt. Call Aaa 404,268 Guaranteed Lease Revenue Bonds, County Administration Complex Project, Series 2005, 5.000%, 11/15/26 1,000 Burlington County Bridge Commission, New Jersey, 12/13 at 100.00 AA 1,020,180 Guaranteed Pooled Loan Bonds, Series 2003, 5.000%, 12/01/18 - MBIA Insured 750 Casino Reinvestment Development Authority, New Jersey, 1/15 at 102.00 AA 773,423 Hotel Room Fee Revenue Bonds, Series 2004, 5.250%, 1/01/16 - AMBAC Insured 435 Essex County Improvement Authority, New Jersey, No Opt. Call Aa3 441,047 Project Consolidation Revenue Bonds, Series 2007, 5.250%, 12/15/22 - AMBAC Insured 530 Garden State Preservation Trust, New Jersey, No Opt. Call AAA 555,657 Open Space and Farmland Preservation Bonds, Series 2005C, 5.125%, 11/01/18 - FSA Insured 1,305 New Jersey Building Authority, State Building Revenue 6/16 at 100.00 AA- 1,247,476 Bonds, Series 2007A, 5.000%, 6/15/26 New Jersey Economic Development Authority, Cigarette Tax Revenue Bonds, Series 2004: 435 5.500%, 6/15/24 6/12 at 100.00 BBB 346,504 700 5.750%, 6/15/34 6/14 at 100.00 BBB 525,378 New Jersey Economic Development Authority, Revenue Bonds, Newark Downtown District Management Corporation Project, Series 2007: 50 5.125%, 6/15/27 6/17 at 100.00 Baa3 38,680 75 5.125%, 6/15/37 6/17 at 100.00 Baa3 53,390 43 NUJ Nuveen New Jersey Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED (continued) New Jersey Economic Development Authority, School Facilities Construction Financing Program Bonds, Series 2007U: $ 435 5.000%, 9/01/37 - AMBAC Insured 9/17 at 100.00 AA $ 395,532 870 5.000%, 9/01/37 9/17 at 100.00 AA- 791,065 350 New Jersey Educational Facilities Authority, Revenue No Opt. Call AAA 372,579 Bonds, Higher Education Capital Improvement Fund, Series 2005A, 5.000%, 9/01/15 - FSA Insured New Jersey Health Care Facilities Financing Authority, Lease Revenue Bonds, Department of Human Services - Greystone Park Psychiatric Hospital, Series 2005: 655 5.000%, 9/15/18 - AMBAC Insured 9/15 at 100.00 AA 654,555 985 5.000%, 9/15/24 - AMBAC Insured 9/15 at 100.00 AA 935,238 200 New Jersey Health Care Facilities Financing Authority, 10/18 at 100.00 AA- 173,790 State Contract Bonds, Hospital Asset Transformation Program, Series 2008A, 5.250%, 10/01/38 1,000 New Jersey Transit Corporation, Certificates of Participation, No Opt. Call AA 1,055,210 Federal Transit Administration Grants, Series 2002A, 5.500%, 9/15/14 - AMBAC Insured 765 New Jersey Transit Corporation, Lease Appropriation Bonds, 9/15 at 100.00 A2 753,487 Series 2005A, 5.000%, 9/15/18 - FGIC Insured New Jersey Transportation Trust Fund Authority, Federal Highway Aid Grant Anticipation Bonds, Series 2006: 295 5.000%, 6/15/17 - FGIC Insured 6/16 at 100.00 A1 300,750 525 5.000%, 6/15/18 - FGIC Insured 6/16 at 100.00 A1 528,544 900 New Jersey Transportation Trust Fund Authority, No Opt. Call AA 965,871 Transportation System Bonds, Series 2004B, 5.500%, 12/15/16 - MBIA Insured 665 New Jersey Transportation Trust Fund Authority, 6/15 at 100.00 AAA 667,081 Transportation System Bonds, Series 2005D, 5.000%, 6/15/19 - FSA Insured 800 New Jersey Transportation Trust Fund Authority, No Opt. Call AA- 815,712 Transportation System Bonds, Series 2006A, 5.500%, 12/15/22 New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2006C: 3,040 0.000%, 12/15/28 - AMBAC Insured No Opt. Call AA 923,430 2,000 0.000%, 12/15/32 - FSA Insured No Opt. Call AAA 474,480 5,000 0.000%, 12/15/34 - FSA Insured No Opt. Call AAA 1,040,050 290 Puerto Rico Convention Center District Authority, 7/16 at 100.00 BBB+ 213,011 Hotel Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 - CIFG Insured ------------------------------------------------------------------------------------------------------------------------------------ 24,455 Total Tax Obligation/Limited 16,466,388 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 24.4% (15.4% OF TOTAL INVESTMENTS) 500 Delaware River and Bay Authority, Delaware and 1/15 at 100.00 AA 475,330 New Jersey, Revenue Bonds, Series 2005, 5.000%, 1/01/27 - MBIA Insured 600 New Jersey Economic Development Authority, 11/10 at 101.00 B 388,494 Special Facilities Revenue Bonds, Continental Airlines Inc., Series 2000, 7.000%, 11/15/30 (Alternative Minimum Tax) 2,000 New Jersey Turnpike Authority, Revenue Bonds, 7/13 at 100.00 AA 1,976,340 Series 2003A, 5.000%, 1/01/19 - FGIC Insured 1,500 New Jersey Turnpike Authority, Revenue Bonds, No Opt. Call AAA 1,485,165 Series 2005A, 5.250%, 1/01/29 - FSA Insured 500 Port Authority of New York and New Jersey, Consolidated 1/14 at 101.00 AA- 462,795 Revenue Bonds, One Hundred Thirty-Fourth Series 2004, 5.000%, 7/15/34 3,000 Port Authority of New York and New Jersey, Consolidated 4/12 at 101.00 AAA 2,813,879 Revenue Bonds, One Hundred Twenty-Fifth Series 2002, 5.000%, 10/15/26 - FSA Insured 2,000 Port Authority of New York and New Jersey, Consolidated 6/14 at 100.00 AA 1,696,780 Revenue Bonds, One Hundred Twenty-Seventh Series 2002, 5.125%, 6/15/37 - AMBAC Insured (Alternative Minimum Tax) 44 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION (continued) Port Authority of New York and New Jersey, Special Project Bonds, JFK International Air Terminal LLC, Sixth Series 1997: $ 4,000 7.000%, 12/01/12 - MBIA Insured (Alternative Minimum Tax) No Opt. Call AA $ 3,975,678 50 5.750%, 12/01/22 - MBIA Insured (Alternative Minimum Tax) 12/08 at 101.00 AA 44,456 ------------------------------------------------------------------------------------------------------------------------------------ 14,150 Total Transportation 13,318,917 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 29.1% (18.4% OF TOTAL INVESTMENTS) (4) 1,000 Bergen County Improvement Authority, New Jersey, 9/12 at 101.00 N/R (4) 1,099,620 Revenue Bonds, Yeshiva Ktana of Passaic Project, Series 2002, 6.000%, 9/15/27 (Pre-refunded 9/01/12) 2,000 Jackson Township School District, Ocean County, 4/12 at 100.00 AA (4) 2,128,980 New Jersey, General Obligation Bonds, Series 2002, 5.000%, 4/15/21 (Pre-refunded 4/15/12) - FGIC Insured 175 New Jersey Educational Facilities Authority, Revenue 7/16 at 100.00 AA (4) 188,785 Bonds, Kean University, Series 2005B, 5.000%, 7/01/30 (Pre-refunded 7/01/16) - MBIA Insured New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2005F: 800 5.000%, 7/01/17 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 862,136 315 5.000%, 7/01/32 (Pre-refunded 7/01/15) - FGIC Insured 7/15 at 100.00 A2 (4) 339,466 1,250 New Jersey Health Care Facilities Financing Authority, 7/12 at 100.00 A3 (4) 1,363,175 Revenue Bonds, South Jersey Hospital System, Series 2002, 5.875%, 7/01/21 (Pre-refunded 7/01/12) 1,920 New Jersey Housing and Mortgage Finance Agency, 11/08 at 100.75 Aaa 1,615,373 Multifamily Housing Revenue Bonds, Series 1997A, 5.650%, 5/01/40 - AMBAC Insured (Alternative Minimum Tax) 535 New Jersey Transportation Trust Fund Authority, 6/15 at 100.00 AAA 578,693 Transportation System Bonds, Series 2005D, 5.000%, 6/15/19 (Pre-refunded 6/15/15) - FSA Insured New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: 170 6.500%, 1/01/16 (ETM) No Opt. Call AAA 195,843 2,430 6.500%, 1/01/16 (ETM) No Opt. Call AAA 2,711,807 250 Newark Housing Authority, New Jersey, Port Authority 1/14 at 100.00 AA (4) 270,810 Terminal Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) - MBIA Insured 1,000 Puerto Rico Infrastructure Financing Authority, 10/10 at 101.00 AAA 1,001,010 Special Obligation Bonds, Series 2000A, 5.500%, 10/01/40 505 Puerto Rico Public Finance Corporation, Commonwealth 2/12 at 100.00 AAA 538,704 Appropriation Bonds, Series 2002E, 5.500%, 8/01/29 (Pre-refunded 2/01/12) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: 1,525 6.125%, 6/01/24 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 1,604,148 1,250 6.375%, 6/01/32 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,366,850 ------------------------------------------------------------------------------------------------------------------------------------ 15,125 Total U.S. Guaranteed 15,865,400 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 5.0% (3.2% OF TOTAL INVESTMENTS) 95 Camden County Pollution Control Financing Authority, 12/08 at 100.00 Baa3 95,185 New Jersey, Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax) 2,300 Guam Power Authority, Revenue Bonds, Series 1999A, 10/09 at 101.00 AA 1,926,779 5.250%, 10/01/34 - MBIA Insured 750 New Jersey Economic Development Authority, Pollution No Opt. Call Baa1 718,860 Control Revenue Refunding Bonds, Public Service Electric and Gas Company, Series 2001A, 5.000%, 3/01/12 ------------------------------------------------------------------------------------------------------------------------------------ 3,145 Total Utilities 2,740,824 ------------------------------------------------------------------------------------------------------------------------------------ 45 NUJ Nuveen New Jersey Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 1.2% (0.7% OF TOTAL INVESTMENTS) $ 150 Guam Government Waterworks Authority, Water and 7/15 at 100.00 Ba2 $ 121,094 Wastewater System Revenue Bonds, Series 2005, 6.000%, 7/01/25 500 North Hudson Sewerage Authority, New Jersey, Sewerage 8/12 at 100.00 N/R 503,335 Revenue Refunding Bonds, Series 2002A, 5.250%, 8/01/19 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 650 Total Water and Sewer 624,429 ------------------------------------------------------------------------------------------------------------------------------------ $ 101,680 Total Investments (cost $96,425,385) - 158.5% 86,433,657 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 4.8% 2,605,556 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (63.3)% (5) (34,500,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $54,539,213 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 39.9%. N/R Not rated. (ETM) Escrowed to maturity. See accompanying notes to financial statements. 46 NQP Nuveen Pennsylvania Investment Quality Municipal Fund Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 0.5% (0.3% OF TOTAL INVESTMENTS) $ 1,000 Pennsylvania Economic Development Financing Authority, No Opt. Call AA- $ 906,470 Solid Waste Disposal Revenue Bonds, Procter & Gamble Paper Project, Series 2001, 5.375%, 3/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 32.7% (19.2% OF TOTAL INVESTMENTS) 2,000 Allegheny County Higher Education Building Authority, 3/09 at 102.00 BBB 1,759,180 Pennsylvania, College Revenue Bonds, Chatham College, Series 1998A, 5.250%, 9/01/18 200 Allegheny County Higher Education Building Authority, No Opt. Call Baa3 160,664 Pennsylvania, College Revenue Refunding Bonds, Robert Morris College, Series 1998A, 6.000%, 5/01/28 3,000 Allegheny County Higher Education Building Authority, 3/12 at 100.00 AA- 2,849,130 Pennsylvania, Revenue Bonds, Carnegie Mellon University, Series 2002, 5.125%, 3/01/32 1,235 Allegheny County Higher Education Building Authority, 2/16 at 100.00 Baa3 870,514 Pennsylvania, Revenue Bonds, Robert Morris University, Series 2006A, 4.750%, 2/15/26 2,000 Chester County Industrial Development Authority, 1/12 at 100.00 AA 1,870,680 Pennsylvania, Educational Facilities Revenue Bonds, Westtown School, Series 2002, 5.000%, 1/01/26 - AMBAC Insured 3,000 Delaware County Authority, Pennsylvania, Revenue Bonds, 11/10 at 101.00 AA 3,026,490 Haverford College, Series 2000, 5.750%, 11/15/29 Delaware County Authority, Pennsylvania, Revenue Bonds, Villanova University, Series 2006: 1,710 5.000%, 8/01/23 - AMBAC Insured 8/16 at 100.00 AA 1,662,924 840 5.000%, 8/01/24 - AMBAC Insured 8/16 at 100.00 AA 810,634 Erie Higher Education Building Authority, Pennsylvania, College Revenue Bonds, Gannon University, Series 2007-GG3: 790 5.000%, 5/01/32 - RAAI Insured 5/17 at 100.00 BBB+ 612,100 250 5.000%, 5/01/35 - RAAI Insured 5/17 at 100.00 BBB+ 188,655 1,000 Harveys Lake General Municipal Authority, Pennsylvania, 11/09 at 100.00 N/R 906,480 College Revenue Bonds, College of Misericordia Project, Series 1999, 6.000%, 5/01/19 - ACA Insured Indiana County Industrial Development Authority, Pennsylvania, Revenue Bonds, Student Cooperative Association Inc./Indiana University of Pennsylvania - Student Union Project, Series 1999B: 815 0.000%, 11/01/15 - AMBAC Insured No Opt. Call AA 575,537 815 0.000%, 11/01/16 - AMBAC Insured No Opt. Call AA 539,579 815 0.000%, 11/01/17 - AMBAC Insured No Opt. Call AA 504,884 815 0.000%, 11/01/18 - AMBAC Insured No Opt. Call AA 467,223 815 0.000%, 11/01/19 - AMBAC Insured No Opt. Call AA 435,601 1,515 Montgomery County Higher Education and Health 4/16 at 100.00 A3 1,167,232 Authority, Pennsylvania, Revenue Bonds, Arcadia University, Series 2006, 4.500%, 4/01/30 - RAAI Insured 355 New Wilmington, Pennsylvania, Revenue, Westminster 5/17 at 100.00 BBB+ 278,221 College, Series 2007G, 5.125%, 5/01/33 - RAAI Insured 8,000 Pennsylvania Higher Education Assistance Agency, Capital 11/11 at 100.00 AA 6,852,160 Acquisition Revenue Refunding Bonds, Series 2001, 5.000%, 12/15/30 - MBIA Insured 5,000 Pennsylvania Higher Educational Facilities Authority, 6/12 at 100.00 Aa3 5,017,800 General Revenue Bonds, State System of Higher Education, Series 2002W, 5.000%, 6/15/19 - AMBAC Insured 4,600 Pennsylvania Higher Educational Facilities Authority, 6/18 at 100.00 Aa3 4,216,130 General Revenue Bonds, State System of Higher Education, Series 2008AH, 5.000%, 6/15/33 47 NQP Nuveen Pennsylvania Investment Quality Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) $ 1,435 Pennsylvania Higher Educational Facilities Authority, 5/16 at 100.00 A- $ 1,170,271 Revenue Bonds, Allegheny College, Series 2006, 4.750%, 5/01/31 2,650 Pennsylvania Higher Educational Facilities Authority, 11/17 at 100.00 AA 2,376,467 Revenue Bonds, Drexel University, Series 2007A, 5.000%, 5/01/37 - MBIA Insured 5,000 Pennsylvania Higher Educational Facilities Authority, 7/11 at 100.00 BBB+ 4,068,250 Revenue Bonds, Moravian College, Series 2001, 5.375%, 7/01/31 - RAAI Insured 3,870 Pennsylvania Higher Educational Facilities Authority, 4/16 at 100.00 AA 3,817,058 Revenue Bonds, Temple University, First Series of 2006, 5.000%, 4/01/21 - MBIA Insured 320 Pennsylvania Higher Educational Facilities Authority, 1/13 at 100.00 A1 313,811 Revenue Bonds, Thomas Jefferson University, Series 2002, 5.000%, 1/01/20 2,000 Pennsylvania Higher Educational Facilities Authority, 7/15 at 100.00 AA+ 1,800,480 Revenue Bonds, University of Pennsylvania, Series 2005C, 5.000%, 7/15/38 2,945 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 A- 2,833,561 Revenue Bonds, Ursinus College, Series 2003, 5.375%, 1/01/20 - RAAI Insured 785 Pennsylvania Higher Educational Facilities Authority, 11/15 at 100.00 A 733,112 Revenue Bonds, York College Project, Series 2005EE1, 5.250%, 11/01/27 - SYNCORA GTY Insured 6,500 Pennsylvania State University, General Revenue Bonds, 9/15 at 100.00 AA 6,200,155 Series 2005, 5.000%, 9/01/29 (UB) Philadelphia Authority for Industrial Development, Pennsylvania, Revenue Bonds, Franklin Towne Charter High School, Series 2006A: 510 5.250%, 1/01/27 1/17 at 100.00 BBB 538,902 860 5.375%, 1/01/32 1/17 at 100.00 BBB 916,038 2,830 Swarthmore Borough Authority, Pennsylvania, Swarthmore 12/08 at 100.00 AAA 2,830,000 College Revenue Bonds, Series 1998, 5.000%, 9/15/28 1,665 Union County, Higher Education Facilities Financing 4/13 at 100.00 Aa2 1,711,420 Authority, Pennsylvania, Revenue Bonds, Bucknell University, Series 2002A, 5.250%, 4/01/18 ------------------------------------------------------------------------------------------------------------------------------------ 70,940 Total Education and Civic Organizations 64,081,343 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 14.0% (8.2% OF TOTAL INVESTMENTS) Allegheny County Hospital Development Authority, Pennsylvania, Revenue Bonds, Ohio Valley General Hospital, Series 2005A: 1,150 5.000%, 4/01/25 4/15 at 100.00 Baa2 841,858 1,555 5.125%, 4/01/35 4/15 at 100.00 Baa2 1,033,064 1,115 Erie County Hospital Authority, Pennsylvania, Revenue 11/12 at 100.00 AA 1,135,215 Bonds, Hamot Health Foundation, Series 2002, 5.250%, 11/01/15 - AMBAC Insured 280 Erie County Hospital Authority, Pennsylvania, Revenue 11/17 at 100.00 A- 228,292 Bonds, Hamot Health Foundation, Series 2007, 5.000%, 11/01/37 - CIFG Insured 1,890 Lancaster County Hospital Authority, Pennsylvania, 3/17 at 100.00 AA- 1,689,547 Hospital Revenue Bonds, The Lancaster General Hospital Project, Series 2007A, 5.000%, 3/15/26 250 Lebanon County Health Facilities Authority, Pennsylvania, 11/12 at 101.00 BBB 220,675 Revenue Bonds, Good Samaritan Hospital Project, Series 2002, 5.800%, 11/15/22 3,280 Lehigh County General Purpose Authority, Pennsylvania, 7/18 at 100.00 AAA 2,941,701 Hospital Revenue Bonds, Lehigh Valley Health Network, Series 2008A, 5.000%, 7/01/33 - FSA Insured 1,250 Lehigh County General Purpose Authority, Pennsylvania, 11/14 at 100.00 A 1,134,888 Revenue Bonds, Good Shepherd Group, Series 2004A, 5.500%, 11/01/24 5,345 Lehigh County General Purpose Authority, Pennsylvania, 11/17 at 100.00 AAA 4,954,975 Revenue Bonds, Good Shepherd Group, Series 2007, 5.000%, 11/01/30 - AGC Insured 710 Monroe County Hospital Authority, Pennsylvania, Hospital 1/17 at 100.00 A- 512,712 Revenue Bonds, Pocono Medical Center, Series 2007, 5.125%, 1/01/37 48 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) $ 9,000 Pennsylvania Higher Educational Facilities Authority, 1/11 at 101.00 AA- $ 8,565,120 Revenue Bonds, UPMC Health System, Series 2001A, 6.000%, 1/15/31 1,615 Sayre Health Care Facility Authority, Pennsylvania, 7/12 at 100.00 AA 1,586,754 Revenue Bonds, Latrobe Area Hospital, Series 2002A, 5.250%, 7/01/13 - AMBAC Insured 1,060 Sayre Healthcare Facility Authority, Pennsylvania, 12/17 at 100.00 A 545,900 Revenue Bonds, Guthrie Healthcare System, Series 2007, 4.263%, 12/01/31 - AMBAC Insured Southcentral Pennsylvania General Authority, Revenue Bonds, Hanover Hospital Inc., Series 2005: 525 5.000%, 12/01/27 - RAAI Insured 12/15 at 100.00 A3 390,327 370 5.000%, 12/01/29 - RAAI Insured 12/15 at 100.00 A3 266,615 1,500 West Shore Area Hospital Authority, Cumberland County, 1/12 at 100.00 BBB 1,274,940 Pennsylvania, Hospital Revenue Bonds, Holy Spirit Hospital of the Sisters of Christian Charity Project, Series 2001, 6.250%, 1/01/32 ------------------------------------------------------------------------------------------------------------------------------------ 30,895 Total Health Care 27,322,583 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 3.6% (2.1% OF TOTAL INVESTMENTS) 5,000 Pennsylvania Higher Educational Facilities Authority, 7/17 at 100.00 BBB- 3,587,250 Revenue Bonds, Slippery Rock University Foundation Inc., Series 2007A, 5.000%, 7/01/39 - SYNCORA GTY Insured 3,300 Pennsylvania Higher Educational Facilities Authority, 7/15 at 100.00 BBB- 2,558,028 Revenue Bonds, Slippery Rock University Foundation Inc., Student Housing Project, Series 2005A, 5.000%, 7/01/37 - SYNCORA GTY Insured 800 Philadelphia Authority for Industrial Development, 5/15 at 102.00 Baa2 596,600 Pennsylvania, Multifamily Housing Revenue Bonds, Presbyterian Homes Germantown - Morrisville Project, Series 2005A, 5.625%, 7/01/35 260 Pittsburgh Urban Redevelopment Authority, Pennsylvania, 2/09 at 100.00 A2 260,138 Mortgage Revenue Bonds, Series 1992C, 7.125%, 8/01/13 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 9,360 Total Housing/Multifamily 7,002,016 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 9.4% (5.6% OF TOTAL INVESTMENTS) 9,000 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 6,476,940 Mortgage Revenue Bonds, Series 1995A, 4.900%, 10/01/37 (Alternative Minimum Tax) 2,665 Pennsylvania Housing Finance Agency, Single Family 4/15 at 100.00 AA+ 2,130,401 Mortgage Revenue Bonds, Series 2006-93A, 4.950%, 10/01/26 (Alternative Minimum Tax) 3,495 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 2,652,216 Mortgage Revenue Bonds, Series 2006-94A, 5.150%, 10/01/37 (Alternative Minimum Tax) 1,355 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 1,006,426 Mortgage Revenue Bonds, Series 2007-97A, 4.600%, 10/01/27 (Alternative Minimum Tax) 2,130 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 1,572,877 Mortgage Revenue Bonds, Series 2007-98A, 4.850%, 10/01/31 (Alternative Minimum Tax) 2,150 Pennsylvania Housing Finance Agency, Single Family 10/17 at 100.00 AA+ 1,902,535 Mortgage Revenue Bonds, Series 2008-103-C, 5.450%, 10/01/38 960 Pittsburgh Urban Redevelopment Authority, Pennsylvania, 4/09 at 100.00 AAA 967,814 Mortgage Revenue Bonds, Series 1997A, 6.250%, 10/01/28 (Alternative Minimum Tax) 2,140 Pittsburgh Urban Redevelopment Authority, Pennsylvania, 10/11 at 100.00 AAA 1,755,292 Mortgage Revenue Bonds, Series 2001B, 5.450%, 10/01/32 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 23,895 Total Housing/Single Family 18,464,501 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 4.7% (2.8% OF TOTAL INVESTMENTS) 5,000 Pennsylvania Economic Development Financing Authority, 5/11 at 101.00 A2 3,996,100 Exempt Facilities Revenue Bonds, Amtrak Project, Series 2001A, 6.375%, 11/01/41 (Alternative Minimum Tax) 5,000 Pennsylvania Industrial Development Authority, No Opt. Call AA 5,254,900 Economic Development Revenue Bonds, Series 2002, 5.500%, 7/01/12 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 10,000 Total Industrials 9,251,000 ------------------------------------------------------------------------------------------------------------------------------------ 49 NQP Nuveen Pennsylvania Investment Quality Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 2.5% (1.5% OF TOTAL INVESTMENTS) $ 1,330 Cumberland County Municipal Authority, Pennsylvania, 1/17 at 100.00 N/R $ 927,941 Revenue Bonds, Diakon Lutheran Social Ministries, Series 2007, 5.000%, 1/01/36 1,500 Cumberland County Municipal Authority, Pennsylvania, 12/12 at 100.00 BBB+ 1,128,330 Revenue Bonds, Presbyterian Homes Inc., Series 2003A, 5.000%, 12/01/26 - RAAI Insured Lancaster County Hospital Authority, Pennsylvania, Health Center Revenue Bonds, Masonic Homes Project, Series 2006: 1,550 5.000%, 11/01/26 11/16 at 100.00 A+ 1,250,432 415 5.000%, 11/01/36 11/16 at 100.00 A+ 305,693 1,500 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AA 1,291,860 Pennsylvania, Revenue Bonds, Philadelphia Corporation for the Aging Project, Series 2001B, 5.250%, 7/01/26 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 6,295 Total Long-Term Care 4,904,256 ------------------------------------------------------------------------------------------------------------------------------------ MATERIALS - 1.0% (0.6% OF TOTAL INVESTMENTS) 1,260 Bradford County Industrial Development Authority, 12/15 at 100.00 BBB 943,488 Pennsylvania, Solid Waste Disposal Revenue Bonds, International Paper Company, Series 2005B, 5.200%, 12/01/19 (Alternative Minimum Tax) 1,750 Pennsylvania Economic Development Financing Authority, 11/08 at 102.00 N/R 1,065,435 Exempt Facilities Revenue Bonds, National Gypsum Company, Series 1997B, 6.125%, 11/01/27 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 3,010 Total Materials 2,008,923 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 27.7% (16.3% OF TOTAL INVESTMENTS) 1,800 Allegheny County, Pennsylvania, General Obligation Bonds, 5/11 at 100.00 A 1,803,762 Series 2000C-53, 5.250%, 11/01/20 - FGIC Insured 6,000 Delaware Valley Regional Finance Authority, Pennsylvania, No Opt. Call Aa2 6,360,540 Local Government Revenue Bonds, Series 2002, 5.750%, 7/01/17 7,350 Erie City School District, Erie County, Pennsylvania, General No Opt. Call AA 1,865,430 Obligation Bonds, Series 2000, 0.000%, 9/01/30 - AMBAC Insured 1,000 Montgomery County, Pennsylvania, General Obligation 7/09 at 100.00 Aaa 1,000,820 Bonds, Series 1999, 5.000%, 7/15/24 5,000 Pennsylvania Public School Building Authority, Lease 12/16 at 100.00 AAA 4,326,800 Revenue Bonds, School District of Philadelphia, Series 2006B, 5.000%, 6/01/33 - FSA Insured (UB) 4,830 Pennsylvania State, General Obligation Bonds, Series 2007, 3/17 at 100.00 AA 4,064,590 Residuals 1986, 10.386%, 3/01/27 (IF) 1,500 Pennsylvania, General Obligation Bonds, First Series 2006, 10/16 at 100.00 AA 1,559,055 5.000%, 10/01/18 500 Pennsylvania, General Obligation Bonds, Second Series 2005, 1/16 at 100.00 AA 519,485 5.000%, 1/01/18 1,500 Philadelphia School District, Pennsylvania, General Obligation No Opt. Call Aa3 1,365,075 Bonds, Series 2007A, 5.000%, 6/01/34 - FGIC Insured 4,135 Pine-Richland School District, Pennsylvania, School 7/15 at 100.00 AAA 3,755,821 Improvement General Obligation Bonds, Series 2005, 5.000%, 7/15/35 - FSA Insured 3,000 Pittsburgh School District, Allegheny County, Pennsylvania, No Opt. Call AAA 3,263,940 General Obligation Refunding Bonds, Series 2002A, 5.500%, 9/01/15 - FSA Insured 1,070 Schuylkill Valley School District, Berks County, Pennsylvania, 4/16 at 100.00 A1 1,029,468 General Obligation Bonds, Series 2006A, 5.000%, 4/01/22 - FGIC Insured 445 State Public School Building Authority, Pennsylvania, 11/13 at 100.00 N/R 437,600 School Revenue Bonds, Conneaut School District, Series 2003, 5.250%, 11/01/21 - FGIC Insured 21,000 State Public School Building Authority, Pennsylvania, No Opt. Call AAA 21,507,360 Lease Revenue Bonds, Philadelphia School District, Series 2003, 5.500%, 6/01/28 - FSA Insured (UB) 1,465 Stroudsburg Area School District, Monroe County, 4/12 at 100.00 AAA 1,485,583 Pennsylvania, General Obligation Bonds, Series 2001A, 5.000%, 4/01/18 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 60,595 Total Tax Obligation/General 54,345,329 ------------------------------------------------------------------------------------------------------------------------------------ 50 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 10.3% (6.0% OF TOTAL INVESTMENTS) $ 3,500 Allegheny County Port Authority, Pennsylvania, Special 3/11 at 101.00 AA $ 3,095,470 Transportation Revenue Bonds, Series 2001, 5.000%, 3/01/29 - FGIC Insured 8,725 Pennsylvania Intergovernmental Cooperative Authority, 6/09 at 100.00 AA 8,198,097 Special Tax Revenue Refunding Bonds, Philadelphia Funding Program, Series 1999, 4.750%, 6/15/23 - FGIC Insured 2,140 Pennsylvania Turnpike Commission, Oil Franchise Tax 12/18 at 100.00 AA 1,955,425 Senior Lien Revenue Bonds, Series 2003A, 5.000%, 12/01/32 - MBIA Insured 2,700 Philadelphia Municipal Authority, Pennsylvania, Lease 11/13 at 100.00 AAA 2,767,095 Revenue Bonds, Series 2003B, 5.250%, 11/15/17 - FSA Insured 4,000 Pittsburgh and Allegheny Counties Public Auditorium 8/09 at 101.00 AA 3,466,840 Authority, Pennsylvania, Sales Tax Revenue Bonds, Regional Asset District, Series 1999, 5.000%, 2/01/29 - AMBAC Insured 3,140 Puerto Rico Infrastructure Financing Authority, Special No Opt. Call BBB+ 638,927 Tax Revenue Bonds, Series 2005A, 0.000%, 7/01/32 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 24,205 Total Tax Obligation/Limited 20,121,854 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 13.2% (7.8% OF TOTAL INVESTMENTS) 630 Delaware River Joint Toll Bridge Commission, New Jersey 7/13 at 100.00 A2 641,554 and Pennsylvania, Revenue Bonds, Series 2003, 5.250%, 7/01/17 2,035 Lehigh-Northampton Airport Authority, Pennsylvania, 5/10 at 100.00 A2 1,818,537 Airport Revenue Bonds, Lehigh Valley Airport System, Series 2000A, 6.000%, 5/15/30 - MBIA Insured (Alternative Minimum Tax) 5,400 Pennsylvania Economic Development Financing Authority, 6/12 at 102.00 BBB 4,675,644 Revenue Bonds, Amtrak 30th Street Station Parking Garage, Series 2002, 5.800%, 6/01/23 - ACA Insured (Alternative Minimum Tax) 2,200 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, 12/11 at 101.00 AA 2,049,608 Series 2001R, 5.000%, 12/01/30 - AMBAC Insured Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, Series 2006A: 3,820 5.000%, 12/01/22 - AMBAC Insured 6/16 at 100.00 AA 3,747,955 2,930 5.000%, 12/01/24 - AMBAC Insured 6/16 at 100.00 AA 2,835,508 5,000 Philadelphia Airport System, Pennsylvania, Revenue Bonds, 6/11 at 101.00 A+ 3,946,750 Series 2001B, 5.250%, 6/15/31 - FGIC Insured (Alternative Minimum Tax) 3,600 Philadelphia Airport System, Pennsylvania, Revenue Bonds, 6/15 at 100.00 AA 2,525,400 Series 2005A, 4.750%, 6/15/35 - MBIA Insured (Alternative Minimum Tax) 3,250 Philadelphia Parking Authority, Pennsylvania, Airport Parking 9/09 at 101.00 AAA 3,087,923 Revenue Bonds, Series 1999, 5.250%, 9/01/29 - FSA Insured 800 Scranton Parking Authority, Pennsylvania, Guaranteed Parking 9/13 at 100.00 AA 618,064 Revenue Bonds, Series 2004, 5.000%, 9/15/33 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 29,665 Total Transportation 25,946,943 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 36.4% (21.4% OF TOTAL INVESTMENTS) (4) 3,550 Allegheny County, Pennsylvania, General Obligation Bonds, 5/11 at 100.00 A+ (4) 3,767,615 Series 2000C-52, 5.250%, 11/01/23 (Pre-refunded 5/01/11) - FGIC Insured 1,320 Allegheny County, Pennsylvania, General Obligation 5/11 at 100.00 A (4) 1,400,916 Refunding Bonds, Series 2000C-53, 5.250%, 11/01/20 (Pre-refunded 5/01/11) - FGIC Insured Delaware County Regional Water Quality Control Authority, Pennsylvania, Sewerage Revenue Bonds, Series 2001: 5,325 5.100%, 5/01/20 (Pre-refunded 11/01/11) - FGIC Insured 11/11 at 100.00 A3 (4) 5,674,746 1,465 5.100%, 5/01/21 (Pre-refunded 11/01/11) - FGIC Insured 11/11 at 100.00 A3 (4) 1,561,221 1,400 Delaware County Regional Water Quality Control Authority, 5/14 at 100.00 A2 (4) 1,520,302 Pennsylvania, Sewerage Revenue Bonds, Series 2004, 5.250%, 5/01/20 (Pre-refunded 5/01/14) - MBIA Insured 5,000 Erie, Pennsylvania, Water Authority, Water Revenue Bonds, 12/11 at 100.00 AA (4) 5,350,750 Series 2001A, 5.200%, 12/01/30 (Pre-refunded 12/01/11) - MBIA Insured 51 NQP Nuveen Pennsylvania Investment Quality Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (4) (continued) $ 6,275 Hempfield Area School District, Westmoreland County, 2/12 at 100.00 A (4) $ 6,736,087 Pennsylvania, General Obligation Bonds, Series 2002, 5.375%, 2/15/18 (Pre-refunded 2/15/12) - FGIC Insured 1,125 Lehigh County General Purpose Authority, Pennsylvania, 8/13 at 100.00 AAA 1,230,953 Hospital Revenue Bonds, St. Luke's Hospital of Bethlehem, Series 2003, 5.375%, 8/15/33 (Pre-refunded 8/15/13) 680 Pennsylvania Higher Educational Facilities Authority, 1/13 at 100.00 A1 (4) 727,498 Revenue Bonds, Thomas Jefferson University, Series 2002, 5.000%, 1/01/20 (Pre-refunded 1/01/13) 10,935 Philadelphia Authority for Industrial Development, 10/11 at 101.00 AAA 11,747,358 Pennsylvania, Lease Revenue Bonds, Series 2001B, 5.250%, 10/01/30 (Pre-refunded 10/01/11) - FSA Insured 690 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, No Opt. Call Aaa 802,808 Twelfth Series 1990B, 7.000%, 5/15/20 - MBIA Insured (ETM) 2,500 Philadelphia School District, Pennsylvania, General Obligation 8/12 at 100.00 Aa3 (4) 2,725,250 Bonds, Series 2002B, 5.625%, 8/01/18 (Pre-refunded 8/01/12) - FGIC Insured Philadelphia, Pennsylvania, Water and Wastewater Revenue Bonds, Series 2001A: 5,525 5.375%, 11/01/20 (Pre-refunded 11/01/12) - FGIC Insured 11/12 at 100.00 A- (4) 5,998,327 3,185 5.000%, 11/01/31 (Pre-refunded 11/01/12) - FGIC Insured 11/12 at 100.00 A- (4) 3,413,237 1,090 Pittsburgh Urban Redevelopment Authority, Pennsylvania, 5/09 at 100.00 A1 (4) 1,114,209 Tax Increment Financing District Bonds, Center Triangle Project, Series 1999A, 6.100%, 5/01/19 (Pre-refunded 5/01/09) 6,100 Plum Borough School District, Allegheny County, Pennsylvania, 9/11 at 100.00 AA (4) 6,454,776 General Obligation Bonds, Series 2001, 5.250%, 9/15/30 (Pre-refunded 9/15/11) - FGIC Insured 960 St. Mary Hospital Authority, Pennsylvania, Health System 11/14 at 100.00 A1 (4) 1,050,643 Revenue Bonds, Catholic Health East, Series 2004B, 5.375%, 11/15/34 (Pre-refunded 11/15/14) 2,000 Sto Rox School District, Allegheny County, Pennsylvania, 12/10 at 100.00 AA (4) 2,136,560 General Obligation Bonds, Series 2000, 5.800%, 6/15/30 (Pre-refunded 12/15/10) - MBIA Insured 3,000 Warrington Township Municipal Authority, Bucks County, 11/15 at 100.00 N/R (4) 3,498,120 Pennsylvania, Water and Sewer Revenue Bonds, Series 1991, 7.100%, 12/01/21 (Pre-refunded 11/15/15) - FGIC Insured 3,775 West View Borough Municipal Authority, Allegheny County, No Opt. Call AAA 4,522,563 Pennsylvania, Special Obligation Bonds, Series 1985A, 9.500%, 11/15/14 (ETM) ------------------------------------------------------------------------------------------------------------------------------------ 65,900 Total U.S. Guaranteed 71,433,939 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 7.0% (4.1% OF TOTAL INVESTMENTS) 1,250 Allegheny County Industrial Development Authority, No Opt. Call Aa3 1,232,038 Pennsylvania, Pollution Control Revenue Refunding Bonds, Duquesne Light Company, Series 1999A, 4.350%, 12/01/13 - AMBAC Insured 1,210 Carbon County Industrial Development Authority, No Opt. Call BBB- 1,222,463 Pennsylvania, Resource Recovery Revenue Refunding Bonds, Panther Creek Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative Minimum Tax) 1,430 Lehigh County Industrial Development Authority, 2/15 at 100.00 A- 1,225,910 Pennsylvania, Pollution Control Revenue Bonds, Pennsylvania Power and Light Company, Series 2005, 4.750%, 2/15/27 - FGIC Insured 700 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 9/14 at 100.00 AAA 648,487 General Ordinance, Fifth Series 2004A-1, 5.000%, 9/01/26 - FSA Insured 2,000 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 7/13 at 100.00 AAA 2,033,220 General Ordinance, Seventeenth Series 2003, 5.375%, 7/01/19 - FSA Insured 5,490 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 10/17 at 100.00 AA 4,368,228 Seventh Series, 2007, 5.000%, 10/01/37 - AMBAC Insured 3,700 York County Industrial Development Authority, 3/12 at 101.00 Baa1 3,013,539 Pennsylvania, Pollution Control Revenue Refunding Bonds, PSEG Power Project, Series 2001A, 5.500%, 9/01/20 ------------------------------------------------------------------------------------------------------------------------------------ 15,780 Total Utilities 13,743,885 ------------------------------------------------------------------------------------------------------------------------------------ 52 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 7.0% (4.1% OF TOTAL INVESTMENTS) $ 2,100 Allegheny County Sanitary Authority, Pennsylvania, 12/15 at 100.00 AA $ 1,960,665 Sewerage Revenue Bonds, Series 2005A, 5.000%, 12/01/21 - MBIA Insured 2,205 Bethlehem Authority, Northampton and Lehigh Counties, 11/14 at 100.00 AAA 2,156,975 Pennsylvania, Guaranteed Water Revenue Bonds, Series 2004, 5.000%, 11/15/20 - FSA Insured 5,000 Delaware County Industrial Development Authority, 10/12 at 100.00 AA 4,026,950 Pennsylvania, Water Facilities Revenue Bonds, Philadelphia Water Company, Series 2001, 5.350%, 10/01/31 - AMBAC Insured (Alternative Minimum Tax) 2,000 Harrisburg Authority, Dauphin County, Pennsylvania, 7/14 at 100.00 AAA 1,941,900 Water Revenue Refunding Bonds, Series 2004, 5.000%, 7/15/22 - FSA Insured 1,815 Philadelphia, Pennsylvania, Water and Wastewater 11/12 at 100.00 A- 1,579,976 Revenue Bonds, Series 2001A, 5.000%, 11/01/31 - FGIC Insured 2,150 Philadelphia, Pennsylvania, Water and Wastewater 7/15 at 100.00 AAA 2,093,198 Revenue Bonds, Series 2005A, 5.000%, 7/01/23 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 15,270 Total Water and Sewer 13,759,664 ------------------------------------------------------------------------------------------------------------------------------------ $ 366,810 Total Investments (cost $362,178,614) - 170.0% 333,292,706 =============----------------------------------------------------------------------------------------------------------------------- Floating Rate Obligations - (10.9)% (21,310,000) -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 8.2% 16,098,261 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (67.3)% (5) (132,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $196,080,967 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 39.6%. N/R Not rated. (ETM) Escrowed to maturity. (IF) Inverse floating rate investment. (UB) Underlying bond of an inverse floating rate trust reflected as a financing transaction pursuant to the provisions of SFAS No. 140. See accompanying notes to financial statements. 53 NPY Nuveen Pennsylvania Premium Income Municipal Fund 2 Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 24.1% (15.1% OF TOTAL INVESTMENTS) $ 1,045 Allegheny County Higher Education Building Authority, 5/09 at 102.00 N/R $ 745,649 Pennsylvania, College Revenue Bonds, Thiel College, Series 1999A, 5.375%, 11/15/29 - ACA Insured 200 Allegheny County Higher Education Building Authority, No Opt. Call Baa3 160,664 Pennsylvania, College Revenue Refunding Bonds, Robert Morris College, Series 1998A, 6.000%, 5/01/28 1,245 Allegheny County Higher Education Building Authority, 3/14 at 100.00 A- 1,233,036 Pennsylvania, Revenue Bonds, Duquesne University, Series 2004A, 5.000%, 3/01/19 - FGIC Insured 1,140 Allegheny County Higher Education Building Authority, 2/16 at 100.00 Baa3 803,552 Pennsylvania, Revenue Bonds, Robert Morris University, Series 2006A, 4.750%, 2/15/26 3,000 Chester County Health and Education Facilities Authority, 4/09 at 102.00 BB+ 2,221,650 Pennsylvania, College Revenue Bonds, Immaculata College, Series 1998, 5.625%, 10/15/27 Delaware County Authority, Pennsylvania, Revenue Bonds, Villanova University, Series 2006: 1,565 5.000%, 8/01/23 - AMBAC Insured 8/16 at 100.00 AA 1,521,916 770 5.000%, 8/01/24 - AMBAC Insured 8/16 at 100.00 AA 743,081 Delaware County Authority, Pennsylvania, Revenue Refunding Bonds, Villanova University, Series 2003: 1,705 5.250%, 8/01/19 - FGIC Insured 8/13 at 100.00 AA 1,714,105 1,350 5.250%, 8/01/20 - FGIC Insured 8/13 at 100.00 AA 1,345,208 1,000 5.250%, 8/01/21 - FGIC Insured 8/13 at 100.00 AA 983,500 Erie Higher Education Building Authority, Pennsylvania, College Revenue Bonds, Gannon University, Series 2007-GG3: 725 5.000%, 5/01/32 - RAAI Insured 5/17 at 100.00 BBB+ 561,737 250 5.000%, 5/01/35 - RAAI Insured 5/17 at 100.00 BBB+ 188,655 3,060 Indiana County Industrial Development Authority, 11/14 at 100.00 AA 2,783,223 Pennsylvania, Revenue Bonds, Student Cooperative Association Inc./Indiana University of Pennsylvania - Student Union Project, Series 2004, 5.000%, 11/01/24 - AMBAC Insured 1,575 Montgomery County Higher Education and Health Authority, 4/16 at 100.00 A3 1,213,459 Pennsylvania, Revenue Bonds, Arcadia University, Series 2006, 4.500%, 4/01/30 - RAAI Insured 325 New Wilmington, Pennsylvania, Revenue, Westminster 5/17 at 100.00 BBB+ 254,709 College, Series 2007G, 5.125%, 5/01/33 - RAAI Insured 4,085 Pennsylvania Higher Educational Facilities Authority, 6/12 at 100.00 Aa3 4,099,543 General Revenue Bonds, State System of Higher Education, Series 2002W, 5.000%, 6/15/19 - AMBAC Insured 4,200 Pennsylvania Higher Educational Facilities Authority, 6/18 at 100.00 Aa3 3,849,510 General Revenue Bonds, State System of Higher Education, Series 2008AH, 5.000%, 6/15/33 1,285 Pennsylvania Higher Educational Facilities Authority, 5/16 at 100.00 A- 1,047,943 Revenue Bonds, Allegheny College, Series 2006, 4.750%, 5/01/31 2,420 Pennsylvania Higher Educational Facilities Authority, 11/17 at 100.00 AA 2,170,208 Revenue Bonds, Drexel University, Series 2007A, 5.000%, 5/01/37 - MBIA Insured 3,000 Pennsylvania Higher Educational Facilities Authority, 4/16 at 100.00 AA 2,958,960 Revenue Bonds, Temple University, First Series of 2006, 5.000%, 4/01/21 - MBIA Insured 1,845 Pennsylvania Higher Educational Facilities Authority, 1/13 at 100.00 A1 1,636,589 Revenue Bonds, Thomas Jefferson University, Series 2002, 5.000%, 1/01/32 2,000 Pennsylvania Higher Educational Facilities Authority, 7/15 at 100.00 AA+ 1,800,480 Revenue Bonds, University of Pennsylvania, Series 2005C, 5.000%, 7/15/38 54 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) $ 1,310 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 A- $ 1,226,671 Revenue Bonds, Ursinus College, Series 2003, 5.500%, 1/01/24 - RAAI Insured 800 Pennsylvania Higher Educational Facilities Authority, 11/15 at 100.00 A 747,120 Revenue Bonds, York College Project, Series 2005EE1, 5.250%, 11/01/27 - SYNCORA GTY Insured 1,000 Pennsylvania Higher Educational Facilities Authority, 5/15 at 100.00 A3 791,380 University of the Sciences in Philadelphia Revenue Bonds, Series 2005, 4.750%, 11/01/33 - SYNCORA GTY Insured 3,105 Pennsylvania State University, General Revenue Bonds, 8/16 at 100.00 AA 2,422,397 Tender Option Bond Trust 3214, 10.747%, 8/15/36 (IF) Philadelphia Authority for Industrial Development, Pennsylvania, Revenue Bonds, Franklin Towne Charter High School, Series 2006A: 470 5.250%, 1/01/27 1/17 at 100.00 BBB 496,635 790 5.375%, 1/01/32 1/17 at 100.00 BBB 841,476 1,545 State Public School Building Authority, Pennsylvania, 5/15 at 100.00 Aa3 1,582,003 College Revenue Bonds, Montgomery County Community College, Series 2005, 5.000%, 5/01/18 - AMBAC Insured 750 Union County, Higher Education Facilities Financing Authority, 4/13 at 100.00 Aa2 767,153 Pennsylvania, Revenue Bonds, Bucknell University, Series 2002A, 5.250%, 4/01/19 ------------------------------------------------------------------------------------------------------------------------------------ 47,560 Total Education and Civic Organizations 42,912,212 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 13.8% (8.7% OF TOTAL INVESTMENTS) Allegheny County Hospital Development Authority, Pennsylvania, Revenue Bonds, Ohio Valley General Hospital, Series 2005A: 1,150 5.000%, 4/01/25 4/15 at 100.00 Baa2 841,858 1,455 5.125%, 4/01/35 4/15 at 100.00 Baa2 966,629 1,230 Erie County Hospital Authority, Pennsylvania, Revenue 11/12 at 100.00 AA 1,244,711 Bonds, Hamot Health Foundation, Series 2002, 5.250%, 11/01/16 - AMBAC Insured 395 Erie County Hospital Authority, Pennsylvania, Revenue 11/17 at 100.00 A- 322,055 Bonds, Hamot Health Foundation, Series 2007, 5.000%, 11/01/37 - CIFG Insured 1,885 Lancaster County Hospital Authority, Pennsylvania, 3/17 at 100.00 AA- 1,685,077 Hospital Revenue Bonds, The Lancaster General Hospital Project, Series 2007A, 5.000%, 3/15/26 5,000 Lebanon County Health Facilities Authority, Pennsylvania, 11/12 at 101.00 BBB 4,237,300 Revenue Bonds, Good Samaritan Hospital Project, Series 2002, 5.900%, 11/15/28 2,990 Lehigh County General Purpose Authority, Pennsylvania, 7/18 at 100.00 AAA 2,681,611 Hospital Revenue Bonds, Lehigh Valley Health Network, Series 2008A, 5.000%, 7/01/33 - FSA Insured 1,250 Lehigh County General Purpose Authority, Pennsylvania, 11/14 at 100.00 A 1,134,888 Revenue Bonds, Good Shepherd Group, Series 2004A, 5.500%, 11/01/24 4,505 Lehigh County General Purpose Authority, Pennsylvania, 11/17 at 100.00 AAA 4,176,270 Revenue Bonds, Good Shepherd Group, Series 2007, 5.000%, 11/01/30 - AGC Insured 650 Monroe County Hospital Authority, Pennsylvania, Hospital 1/17 at 100.00 A- 469,385 Revenue Bonds, Pocono Medical Center, Series 2007, 5.125%, 1/01/37 Pottsville Hospital Authority, Pennsylvania, Hospital Revenue Bonds, Pottsville Hospital and Warne Clinic, Series 1998: 2,000 5.500%, 7/01/18 1/09 at 100.00 BB- 1,573,760 2,000 5.625%, 7/01/24 1/09 at 100.00 BB- 1,450,940 Sayre Health Care Facility Authority, Pennsylvania, Revenue Bonds, Latrobe Area Hospital, Series 2002A: 1,700 5.250%, 7/01/14 - AMBAC Insured 7/12 at 100.00 AA 1,649,663 1,200 5.250%, 7/01/15 - AMBAC Insured 7/12 at 100.00 AA 1,148,496 970 Sayre Healthcare Facility Authority, Pennsylvania, Revenue 12/17 at 100.00 A 499,550 Bonds, Guthrie Healthcare System, Series 2007, 4.263%, 12/01/31 - AMBAC Insured 55 NPY Nuveen Pennsylvania Premium Income Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) Southcentral Pennsylvania General Authority, Revenue Bonds, Hanover Hospital Inc., Series 2005: $ 475 5.000%, 12/01/27 - RAAI Insured 12/15 at 100.00 A3 $ 353,153 330 5.000%, 12/01/29 - RAAI Insured 12/15 at 100.00 A3 237,791 ------------------------------------------------------------------------------------------------------------------------------------ 29,185 Total Health Care 24,673,137 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 5.7% (3.5% OF TOTAL INVESTMENTS) 3,260 Bucks County Redevelopment Authority, Pennsylvania, 2/09 at 100.00 Baa2 3,244,091 Section 8 Assisted Second Lien Multifamily Mortgage Revenue Bonds, Country Commons Apartments, Series 1993A, 6.200%, 8/01/14 (Alternative Minimum Tax) 2,000 Delaware County Industrial Development Authority, 4/12 at 100.00 AAA 1,815,960 Pennsylvania, Multifamily Housing Revenue Bonds, Darby Townhouses Project, Series 2002A, 5.500%, 4/01/32 (Mandatory put 4/01/22) (Alternative Minimum Tax) Pennsylvania Higher Educational Facilities Authority, Revenue Bonds, Slippery Rock University Foundation Inc., Student Housing Project, Series 2005A: 2,035 5.000%, 7/01/19 - SYNCORA GTY Insured 7/15 at 100.00 BBB- 1,895,175 3,400 5.000%, 7/01/37 - SYNCORA GTY Insured 7/15 at 100.00 BBB- 2,635,544 740 Philadelphia Authority for Industrial Development, 5/15 at 102.00 Baa2 551,855 Pennsylvania, Multifamily Housing Revenue Bonds, Presbyterian Homes Germantown - Morrisville Project, Series 2005A, 5.625%, 7/01/35 ------------------------------------------------------------------------------------------------------------------------------------ 11,435 Total Housing/Multifamily 10,142,625 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 7.0% (4.4% OF TOTAL INVESTMENTS) 880 Allegheny County Residential Finance Authority, 11/10 at 100.00 Aaa 767,325 Pennsylvania, GNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Bonds, Series 2000II-2, 5.900%, 11/01/32 (Alternative Minimum Tax) 4,000 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 2,878,640 Mortgage Revenue Bonds, Series 1995A, 4.900%, 10/01/37 (Alternative Minimum Tax) 140 Pennsylvania Housing Finance Agency, Single Family 12/08 at 101.50 AA+ 126,820 Mortgage Revenue Bonds, Series 1998-62A, 5.500%, 10/01/22 (Alternative Minimum Tax) 1,365 Pennsylvania Housing Finance Agency, Single Family 4/15 at 100.00 AA+ 1,091,181 Mortgage Revenue Bonds, Series 2006-93A, 4.950%, 10/01/26 (Alternative Minimum Tax) 3,295 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 2,500,444 Mortgage Revenue Bonds, Series 2006-94A, 5.150%, 10/01/37 (Alternative Minimum Tax) 1,355 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 1,006,426 Mortgage Revenue Bonds, Series 2007-97A, 4.600%, 10/01/27 (Alternative Minimum Tax) 1,710 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 1,262,732 Mortgage Revenue Bonds, Series 2007-98A, 4.850%, 10/01/31 (Alternative Minimum Tax) Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue Bonds, Series 2008-103-C: 430 5.200%, 10/01/28 10/17 at 100.00 AA+ 385,250 1,900 5.450%, 10/01/38 10/17 at 100.00 AA+ 1,681,310 765 Pittsburgh Urban Redevelopment Authority, Pennsylvania, 4/09 at 100.00 AAA 744,705 Mortgage Revenue Bonds, Series 1997A, 6.200%, 10/01/21 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 15,840 Total Housing/Single Family 12,444,833 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 3.4% (2.1% OF TOTAL INVESTMENTS) 2,000 New Morgan Industrial Development Authority, Pennsylvania, 4/09 at 100.00 BB- 1,600,620 Solid Waste Disposal Revenue Bonds, New Morgan Landfill Company Inc., Series 1994, 6.500%, 4/01/19 (Alternative Minimum Tax) 2,000 Pennsylvania Economic Development Financing Authority, 5/11 at 101.00 A2 1,616,760 Exempt Facilities Revenue Bonds, Amtrak Project, Series 2001A, 6.250%, 11/01/31 (Alternative Minimum Tax) 2,750 Pennsylvania Industrial Development Authority, Economic 7/12 at 101.00 AA 2,790,865 Development Revenue Bonds, Series 2002, 5.500%, 7/01/17 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 6,750 Total Industrials 6,008,245 ------------------------------------------------------------------------------------------------------------------------------------ 56 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 5.5% (3.5% OF TOTAL INVESTMENTS) $ 1,100 Chester County Health and Education Facilities Authority, 12/08 at 100.00 BBB- $ 890,417 Pennsylvania, Mortgage Revenue Refunding Bonds, Tel Hai Obligated Group, Series 1998, 5.500%, 6/01/25 4,905 Cumberland County Municipal Authority, Pennsylvania, 1/17 at 100.00 N/R 3,422,219 Revenue Bonds, Diakon Lutheran Social Ministries, Series 2007, 5.000%, 1/01/36 1,000 Cumberland County Municipal Authority, Pennsylvania, 12/12 at 100.00 BBB+ 797,400 Revenue Bonds, Presbyterian Homes Inc., Series 2003A, 5.000%, 12/01/22 - RAAI Insured Lancaster County Hospital Authority, Pennsylvania, Health Center Revenue Bonds, Masonic Homes Project, Series 2006: 1,565 5.000%, 11/01/31 11/16 at 100.00 A+ 1,187,929 230 5.000%, 11/01/36 11/16 at 100.00 A+ 169,420 Pennsylvania Economic Development Financing Authority, Revenue Bonds, Dr. Gertrude A. Barber Center Inc., Series 2000: 1,000 6.150%, 12/01/20 - RAAI Insured 2/09 at 100.00 BBB+ 982,000 2,000 5.900%, 12/01/30 - RAAI Insured 12/10 at 100.00 BBB+ 1,631,700 1,230 Pennsylvania Economic Development Financing Authority, 12/08 at 100.00 BB+ 798,578 Revenue Bonds, Northwestern Human Services Inc., Series 1998A, 5.250%, 6/01/28 ------------------------------------------------------------------------------------------------------------------------------------ 13,030 Total Long-Term Care 9,879,663 ------------------------------------------------------------------------------------------------------------------------------------ MATERIALS - 2.3% (1.4% OF TOTAL INVESTMENTS) 1,190 Bradford County Industrial Development Authority, 12/15 at 100.00 BBB 891,072 Pennsylvania, Solid Waste Disposal Revenue Bonds, International Paper Company, Series 2005B, 5.200%, 12/01/19 (Alternative Minimum Tax) 500 Erie County Industrial Development Authority, Pennsylvania, 9/10 at 101.00 BBB 433,875 Environmental Improvement Revenue Refunding Bonds, Series 2000B, 6.000%, 9/01/16 (Alternative Minimum Tax) 4,500 Pennsylvania Economic Development Financing Authority, 11/08 at 102.00 N/R 2,739,690 Exempt Facilities Revenue Bonds, National Gypsum Company, Series 1997B, 6.125%, 11/01/27 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 6,190 Total Materials 4,064,637 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 16.9% (10.6% OF TOTAL INVESTMENTS) Harrisburg Redevelopment Authority, Dauphin County, Pennsylvania, Guaranteed Revenue Bonds, Series 1998B: 1,750 0.000%, 5/01/22 - FSA Insured 5/16 at 75.56 AAA 752,535 2,750 0.000%, 11/01/22 - FSA Insured 5/16 at 73.64 AAA 1,146,173 2,750 0.000%, 5/01/23 - FSA Insured 5/16 at 71.71 AAA 1,101,568 260 Lower Merion School District, Montgomery County, 9/17 at 100.00 Aaa 263,130 Pennsylvania, General Obligation Bonds, Series 2007, 5.000%, 9/01/23 2,115 Owen J. Roberts School District, Chester County, 5/16 at 100.00 Aaa 2,083,529 Pennsylvania, General Obligation Bonds, Series 2006, 5.000%, 5/15/24 - FSA Insured 4,835 Pennsylvania State, General Obligation Bonds, Series 2007, 3/17 at 100.00 AA 4,068,798 Residuals 1986, 10.386%, 3/01/27 (IF) 3,200 Pennsylvania, General Obligation Bonds, First Series 2006, 10/16 at 100.00 AA 3,325,984 5.000%, 10/01/18 1,000 Pennsylvania, General Obligation Bonds, Second 1/16 at 100.00 AA 1,038,970 Series 2005, 5.000%, 1/01/18 1,500 Philadelphia School District, Pennsylvania, General No Opt. Call Aa3 1,365,075 Obligation Bonds, Series 2007A, 5.000%, 6/01/34 - FGIC Insured 3,775 Pine-Richland School District, Pennsylvania, School 7/15 at 100.00 AAA 3,428,833 Improvement General Obligation Bonds, Series 2005, 5.000%, 7/15/35 - FSA Insured 2,700 Pittsburgh, Pennsylvania, General Obligation Bonds, No Opt. Call AAA 2,840,643 Series 2006B, 5.250%, 9/01/16 - FSA Insured 6,710 Reading School District, Berks County, Pennsylvania, No Opt. Call AA 1,504,785 General Obligation Bonds, Series 2003B, 0.000%, 1/15/32 - FGIC Insured State Public School Building Authority, Pennsylvania, School Revenue Bonds, Conneaut School District, Series 2003: 360 5.250%, 11/01/21 - FGIC Insured 11/13 at 100.00 N/R 354,013 490 5.250%, 11/01/22 - FGIC Insured 11/13 at 100.00 N/R 452,897 57 NPY Nuveen Pennsylvania Premium Income Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 1,500 State Public School Building Authority, Pennsylvania, 5/13 at 100.00 Aaa $ 1,270,275 School Revenue Bonds, York City School District, Series 2003, 4.000%, 5/01/21 - FSA Insured 1,535 Stroudsburg Area School District, Monroe County, 4/12 at 100.00 AAA 1,549,797 Pennsylvania, General Obligation Bonds, Series 2001A, 5.000%, 4/01/19 - FSA Insured 1,400 Woodland Hills School District, Allegheny County, 9/15 at 100.00 AAA 1,439,704 Pennsylvania, General Obligation Bonds, Series 2005D, 5.000%, 9/01/17 - FSA Insured 2,400 York County, Pennsylvania, General Obligation Bonds, 12/15 at 100.00 AA 2,199,912 Series 2006, 5.000%, 6/01/33 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ 41,030 Total Tax Obligation/General 30,186,621 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 9.3% (5.8% OF TOTAL INVESTMENTS) 1,500 Erie County Convention Center Authority, Pennsylvania, 1/15 at 100.00 AA 1,301,715 Convention Center Revenue Bonds, Series 2005, 5.000%, 1/15/36 - FGIC Insured 1,950 Pennsylvania Turnpike Commission, Oil Franchise Tax 12/18 at 100.00 AA 1,781,813 Senior Lien Revenue Bonds, Series 2003A, 5.000%, 12/01/32 - MBIA Insured 5,015 Philadelphia Municipal Authority, Pennsylvania, Lease 11/13 at 100.00 AAA 5,139,623 Revenue Bonds, Series 2003B, 5.250%, 11/15/17 - FSA Insured 6,000 Puerto Rico Highway and Transportation Authority, Highway No Opt. Call Aaa 5,481,240 Revenue Bonds, Series 2007N, 5.500%, 7/01/29 - AMBAC Insured 2,880 Puerto Rico Infrastructure Financing Authority, Special No Opt. Call BBB+ 586,022 Tax Revenue Bonds, Series 2005A, 0.000%, 7/01/32 - FGIC Insured 2,405 Puerto Rico, Highway Revenue Bonds, Highway and No Opt. Call AA 2,321,138 Transportation Authority, Series 2003AA, 5.500%, 7/01/19 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ 19,750 Total Tax Obligation/Limited 16,611,551 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 20.5% (12.8% OF TOTAL INVESTMENTS) 650 Delaware River Joint Toll Bridge Commission, New Jersey 7/13 at 100.00 A2 661,921 and Pennsylvania, Revenue Bonds, Series 2003, 5.250%, 7/01/17 4,600 Pennsylvania Economic Development Financing Authority, 6/12 at 102.00 BBB 3,705,208 Revenue Bonds, Amtrak 30th Street Station Parking Garage, Series 2002, 5.875%, 6/01/33 - ACA Insured (Alternative Minimum Tax) 3,575 Pennsylvania Turnpike Commission, Turnpike Revenue 12/11 at 101.00 AA 3,330,613 Bonds, Series 2001R, 5.000%, 12/01/30 - AMBAC Insured 2,680 Pennsylvania Turnpike Commission, Turnpike Revenue 6/16 at 100.00 AA 2,593,570 Bonds, Series 2006A, 5.000%, 12/01/24 - AMBAC Insured 3,250 Philadelphia Airport System, Pennsylvania, Revenue Bonds, 6/15 at 100.00 AA 2,279,875 Series 2005A, 4.750%, 6/15/35 - MBIA Insured (Alternative Minimum Tax) 10,000 Philadelphia Authority for Industrial Development, 7/11 at 101.00 A+ 8,117,595 Pennsylvania, Airport Revenue Bonds, Philadelphia Airport System Project, Series 2001A, 5.250%, 7/01/28 - FGIC Insured (Alternative Minimum Tax) 6,525 Pittsburgh and Allegheny County Sports and Exhibition 12/08 at 100.00 Aa3 6,233,593 Authority, Pennsylvania, Parking Revenue Bonds, Series 2001A, 5.350%, 12/01/26 - AMBAC Insured 2,000 Pittsburgh Public Parking Authority, Pennsylvania, Parking 12/15 at 100.00 AA 1,747,360 Revenue Bonds, Series 2005B, 5.000%, 12/01/23 - FGIC Insured 2,250 Scranton Parking Authority, Pennsylvania, Guaranteed 6/17 at 100.00 BBB+ 1,765,260 Revenue Bonds, Series 2007, 5.250%, 6/01/39 - RAAI Insured 940 Scranton Parking Authority, Pennsylvania, Guaranteed 9/13 at 100.00 AA 726,225 Parking Revenue Bonds, Series 2004, 5.000%, 9/15/33 - FGIC Insured 6,700 Susquehanna Area Regional Airport Authority, Pennsylvania, 1/13 at 100.00 Aa3 5,385,929 Airport System Revenue Bonds, Series 2003B, 5.000%, 1/01/33 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 43,170 Total Transportation 36,547,149 ------------------------------------------------------------------------------------------------------------------------------------ 58 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 24.6% (15.4% OF TOTAL INVESTMENTS) (4) $ 1,695 Allegheny County Sanitary Authority, Pennsylvania, Sewerage 12/10 at 101.00 AA (4) $ 1,814,769 Revenue Bonds, Series 2000, 5.500%, 12/01/30 (Pre-refunded 12/01/10) - MBIA Insured 1,200 Butler County, Pennsylvania, General Obligation Bonds, 7/13 at 100.00 A+ (4) 1,305,084 Series 2003, 5.250%, 7/15/23 (Pre-refunded 7/15/13) - FGIC Insured 1,615 Delaware County Regional Water Quality Control Authority, 5/14 at 100.00 A2 (4) 1,753,777 Pennsylvania, Sewerage Revenue Bonds, Series 2004, 5.250%, 5/01/23 (Pre-refunded 5/01/14) - MBIA Insured 2,110 Fayette County, Pennsylvania, General Obligation Bonds, 11/10 at 100.00 AA (4) 2,245,019 Series 2000, 5.625%, 11/15/28 (Pre-refunded 11/15/10) - AMBAC Insured 2,600 Norristown Area School District, Montgomery County, 3/13 at 100.00 N/R (4) 2,789,488 Pennsylvania, General Obligation Bonds, Series 2003, 5.000%, 9/01/24 (Pre-refunded 3/01/13) - FGIC Insured 960 Pennsylvania Higher Educational Facilities Authority, No Opt. Call Aaa 1,081,133 College Revenue Bonds, Ninth Series 1976, 7.625%, 7/01/15 (ETM) 2,100 Pennsylvania Higher Educational Facilities Authority, 6/10 at 100.00 A3 (4) 2,218,776 Revenue Bonds, Philadelphia University, Series 2000, 6.000%, 6/01/29 (Pre-refunded 6/01/10) - RAAI Insured 1,500 Pennsylvania Higher Educational Facilities Authority, 7/11 at 101.00 Aaa 1,601,175 Revenue Bonds, Temple University, Series 2001, 5.000%, 7/15/31 (Pre-refunded 7/15/11) - MBIA Insured 3,905 Pennsylvania Higher Educational Facilities Authority, 1/13 at 100.00 A1 (4) 4,177,764 Revenue Bonds, Thomas Jefferson University, Series 2002, 5.000%, 1/01/32 (Pre-refunded 1/01/13) 5,750 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 7/09 at 101.00 AAA 5,935,724 General Ordinance, Second Series 1999, 5.000%, 7/01/29 (Pre-refunded 7/01/09) - FSA Insured Philadelphia Hospitals and Higher Education Facilities Authority, Pennsylvania, Hospital Revenue Bonds, Presbyterian Medical Center of Philadelphia, Series 1993: 825 6.500%, 12/01/11 (ETM) No Opt. Call AAA 874,236 3,740 6.650%, 12/01/19 (ETM) No Opt. Call AAA 4,299,953 1,015 St. Mary Hospital Authority, Pennsylvania, Health System 11/14 at 100.00 A1 (4) 1,110,836 Revenue Bonds, Catholic Health East, Series 2004B, 5.375%, 11/15/34 (Pre-refunded 11/15/14) State Public School Building Authority, Berkes County, Pennsylvania, School Revenue Bonds, Brandywine Heights Area School District, Series 2003: 1,930 5.000%, 2/01/20 (Pre-refunded 2/01/13) - FGIC Insured 2/13 at 100.00 A1 (4) 2,053,887 1,955 5.000%, 2/01/21 (Pre-refunded 2/01/13) - FGIC Insured 2/13 at 100.00 A1 (4) 2,080,491 4,050 State Public School Building Authority, Pennsylvania, 6/13 at 100.00 AAA 4,321,877 Lease Revenue Bonds, Philadelphia School District, Series 2003, 5.000%, 6/01/33 (Pre-refunded 6/01/13) - FSA Insured 2,500 West Cornwall Township Municipal Authority, Pennsylvania, 12/11 at 100.00 BBB+ (4) 2,723,725 College Revenue Bonds, Elizabethtown College Project, Series 2001, 5.900%, 12/15/18 (Pre-refunded 12/15/11) 1,145 West View Borough Municipal Authority, Allegheny No Opt. Call AAA 1,371,744 County, Pennsylvania, Special Obligation Bonds, Series 1985A, 9.500%, 11/15/14 (ETM) ------------------------------------------------------------------------------------------------------------------------------------ 40,595 Total U.S. Guaranteed 43,759,458 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 14.2% (8.9% OF TOTAL INVESTMENTS) 1,125 Allegheny County Industrial Development Authority, No Opt. Call Aa3 1,108,834 Pennsylvania, Pollution Control Revenue Refunding Bonds, Duquesne Light Company, Series 1999A, 4.350%, 12/01/13 - AMBAC Insured 8,000 Beaver County Industrial Development Authority, 12/08 at 102.00 Aaa 6,651,039 Pennsylvania, Exempt Facilities Revenue Bonds, Shippingport Project, Series 1998A, 5.375%, 6/01/28 - AMBAC Insured (Alternative Minimum Tax) 1,645 Carbon County Industrial Development Authority, No Opt. Call BBB- 1,661,944 Pennsylvania, Resource Recovery Revenue Refunding Bonds, Panther Creek Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative Minimum Tax) 7,590 Indiana County Industrial Development Authority, 11/08 at 101.00 AA 6,802,157 Pennsylvania, Pollution Control Revenue Bonds, Metropolitan Edison Company, Series 1997A, 5.950%, 5/01/27 - AMBAC Insured (Alternative Minimum Tax) 2,000 Indiana County Industrial Development Authority, 6/12 at 101.00 Baa1 1,574,360 Pennsylvania, Pollution Control Revenue Refunding Bonds, PSEG Power LLC, Series 2001A, 5.850%, 6/01/27 (Alternative Minimum Tax) 59 NPY Nuveen Pennsylvania Premium Income Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES (continued) $ 2,150 Lehigh County Industrial Development Authority, 2/15 at 100.00 A- $ 1,843,152 Pennsylvania, Pollution Control Revenue Bonds, Pennsylvania Power and Light Company, Series 2005, 4.750%, 2/15/27 - FGIC Insured 700 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 9/14 at 100.00 AAA 648,487 General Ordinance, Fifth Series 2004A-1, 5.000%, 9/01/26 - FSA Insured 1,000 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 7/13 at 100.00 AAA 1,016,610 General Ordinance, Seventeenth Series 2003, 5.375%, 7/01/19 - FSA Insured 5,050 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 10/17 at 100.00 AA 4,018,134 Seventh Series, 2007, 5.000%, 10/01/37 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 29,260 Total Utilities 25,324,717 ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 12.5% (7.8% OF TOTAL INVESTMENTS) 305 Allegheny County Sanitary Authority, Pennsylvania, 12/10 at 101.00 AA 301,907 Sewerage Revenue Bonds, Series 2000, 5.500%, 12/01/30 - MBIA Insured Allegheny County Sanitary Authority, Pennsylvania, Sewerage Revenue Bonds, Series 2005A: 1,900 5.000%, 12/01/21 - MBIA Insured 12/15 at 100.00 AA 1,773,935 2,120 5.000%, 12/01/23 - MBIA Insured 12/15 at 100.00 AA 1,946,923 545 5.000%, 12/01/30 - MBIA Insured 12/15 at 100.00 AA 466,880 2,500 Bethlehem Authority, Northampton and Lehigh Counties, 11/14 at 100.00 AAA 2,445,550 Pennsylvania, Guaranteed Water Revenue Bonds, Series 2004, 5.000%, 11/15/20 - FSA Insured 4,000 Bucks County Industrial Development Authority, 3/12 at 100.00 AA- 3,276,160 Pennsylvania, Water Facility Revenue Bonds, Pennsylvania Suburban Water Company, Series 2002, 5.550%, 9/01/32 - FGIC Insured (Alternative Minimum Tax) 2,000 Harrisburg Authority, Dauphin County, Pennsylvania, 7/14 at 100.00 AAA 1,941,900 Water Revenue Refunding Bonds, Series 2004, 5.000%, 7/15/22 - FSA Insured 3,360 Mercer County Industrial Development Authority, 7/10 at 100.00 AA 2,977,498 Pennsylvania, Water Facility Revenue Bonds, Consumers Water Company, Shenango Valley Division Project, Series 2000, 6.000%, 7/01/30 - MBIA Insured (Alternative Minimum Tax) Norristown Municipal Waste Authority, Pennsylvania, Sewer Revenue Bonds, Series 2003: 1,140 5.125%, 11/15/22 - FGIC Insured 11/13 at 100.00 N/R 1,065,718 2,535 5.125%, 11/15/23 - FGIC Insured 11/13 at 100.00 N/R 2,347,968 2,000 Philadelphia, Pennsylvania, Water and Wastewater 7/15 at 100.00 AAA 1,947,160 Revenue Bonds, Series 2005A, 5.000%, 7/01/23 - FSA Insured 2,000 Unity Township Municipal Authority, Pennsylvania, 12/14 at 100.00 AAA 1,764,180 Sewerage Revenue Bonds, Series 2004, 5.000%, 12/01/34 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 24,405 Total Water and Sewer 22,255,779 ------------------------------------------------------------------------------------------------------------------------------------ $ 328,200 Total Investments (cost $317,316,745) - 159.8% 284,810,627 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 6.5% 11,546,079 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (66.3)% (5) (118,100,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $178,256,706 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 41.5%. N/R Not rated. (ETM) Escrowed to maturity. (IF) Inverse floating rate investment. See accompanying notes to financial statements. 60 NXM Nuveen Pennsylvania Dividend Advantage Municipal Fund Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.3% (1.4% OF TOTAL INVESTMENTS) $ 1,000 Pennsylvania Economic Development Financing Authority, No Opt. Call AA- $ 906,470 Solid Waste Disposal Revenue Bonds, Procter & Gamble Paper Project, Series 2001, 5.375%, 3/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 28.7% (18.1% OF TOTAL INVESTMENTS) 100 Allegheny County Higher Education Building Authority, No Opt. Call Baa3 80,332 Pennsylvania, College Revenue Refunding Bonds, Robert Morris College, Series 1998A, 6.000%, 5/01/28 235 Allegheny County Higher Education Building Authority, 2/16 at 100.00 Baa3 165,644 Pennsylvania, Revenue Bonds, Robert Morris University, Series 2006A, 4.750%, 2/15/26 2,250 Bucks County Industrial Development Authority, 9/11 at 100.00 Aa3 2,037,690 Pennsylvania, Revenue Bonds, George School Project, Series 2001, 5.125%, 9/15/31 - AMBAC Insured 700 Chester County Health and Education Facilities Authority, 10/15 at 102.00 N/R 523,299 Pennsylvania, Revenue Bonds, Immaculata University, Series 2005, 5.500%, 10/15/25 720 Chester County Industrial Development Authority, 12/17 at 100.00 BB+ 551,822 Pennsylvania, Avon Grove Charter School Revenue Bonds, Series 2007A, 6.375%, 12/15/37 1,000 Delaware County Authority, Pennsylvania, College Revenue 10/11 at 100.00 BBB 839,790 Refunding Bonds, Neumann College, Series 2001, 6.000%, 10/01/31 300 Delaware County Authority, Pennsylvania, General Revenue 10/16 at 100.00 A3 226,110 Bonds, Eastern University, Series 2006, 4.500%, 10/01/27 - RAAI Insured Delaware County Authority, Pennsylvania, Revenue Bonds, Villanova University, Series 2006: 295 5.000%, 8/01/23 - AMBAC Insured 8/16 at 100.00 AA 286,879 145 5.000%, 8/01/24 - AMBAC Insured 8/16 at 100.00 AA 139,931 160 Erie Higher Education Building Authority, Pennsylvania, 5/17 at 100.00 BBB+ 123,970 College Revenue Bonds, Gannon University, Series 2007-GG3, 5.000%, 5/01/32 - RAAI Insured 1,000 Montgomery County Industrial Development Authority, 8/15 at 100.00 A1 963,350 Pennsylvania, Revenue Bonds, Hill School, Series 2005, 5.000%, 8/15/27 - MBIA Insured 75 New Wilmington, Pennsylvania, Revenue, Westminster 5/17 at 100.00 BBB+ 58,779 College, Series 2007G, 5.125%, 5/01/33 - RAAI Insured 1,000 Pennsylvania Higher Educational Facilities Authority, 6/12 at 100.00 Aa3 1,003,560 General Revenue Bonds, State System of Higher Education, Series 2002W, 5.000%, 6/15/19 - AMBAC Insured 900 Pennsylvania Higher Educational Facilities Authority, 6/18 at 100.00 Aa3 824,895 General Revenue Bonds, State System of Higher Education, Series 2008AH, 5.000%, 6/15/33 220 Pennsylvania Higher Educational Facilities Authority, 5/16 at 100.00 A- 179,414 Revenue Bonds, Allegheny College, Series 2006, 4.750%, 5/01/31 540 Pennsylvania Higher Educational Facilities Authority, 11/17 at 100.00 AA 484,261 Revenue Bonds, Drexel University, Series 2007A, 5.000%, 5/01/37 - MBIA Insured 1,500 Pennsylvania Higher Educational Facilities Authority, 7/11 at 100.00 BBB+ 1,220,475 Revenue Bonds, Moravian College, Series 2001, 5.375%, 7/01/31 - RAAI Insured 700 Pennsylvania Higher Educational Facilities Authority, 4/16 at 100.00 AA 690,424 Revenue Bonds, Temple University, First Series of 2006, 5.000%, 4/01/21 - MBIA Insured 350 Pennsylvania Higher Educational Facilities Authority, 1/13 at 100.00 A1 359,926 Revenue Bonds, Thomas Jefferson University, Series 2002, 5.500%, 1/01/16 61 NXM Nuveen Pennsylvania Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS (continued) $ 255 Philadelphia Authority for Industrial Development, 1/17 at 100.00 BBB $ 269,451 Pennsylvania, Revenue Bonds, Franklin Towne Charter High School, Series 2006A, 5.250%, 1/01/27 470 Philadelphia Authority for Industrial Development, 1/13 at 102.00 BB 302,877 Pennsylvania, Revenue Bonds, Leadership Learning Partners, Series 2005A, 5.375%, 7/01/36 230 Philadelphia Authority for Industrial Development, 5/16 at 100.00 BB+ 175,704 Pennsylvania, Revenue Bonds, Richard Allen Preparatory Charter School, Series 2006, 6.250%, 5/01/33 ------------------------------------------------------------------------------------------------------------------------------------ 13,145 Total Education and Civic Organizations 11,508,583 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 22.6% (14.3% OF TOTAL INVESTMENTS) 550 Allegheny County Hospital Development Authority, 4/15 at 100.00 Baa2 365,393 Pennsylvania, Revenue Bonds, Ohio Valley General Hospital, Series 2005A, 5.125%, 4/01/35 640 Allentown Area Hospital Authority, Pennsylvania, Revenue No Opt. Call BB- 539,546 Bonds, Sacred Heart Hospital, Series 2005, 6.000%, 11/15/16 2,500 Chester County Health and Educational Facilities 11/08 at 101.00 AA- 2,326,550 Authority, Pennsylvania, Health System Revenue Bonds, Jefferson Health System, Series 1997B, 5.375%, 5/15/27 80 Erie County Hospital Authority, Pennsylvania, Revenue 11/17 at 100.00 A- 65,226 Bonds, Hamot Health Foundation, Series 2007, 5.000%, 11/01/37 - CIFG Insured 230 Fulton County, Pennsylvania, Industrial Development 7/16 at 100.00 N/R 157,886 Authority Hospital Revenue Bonds, Fulton County Medical Center Project, Series 2006, 5.900%, 7/01/40 650 Lehigh County General Purpose Authority, Pennsylvania, 7/18 at 100.00 AAA 582,959 Hospital Revenue Bonds, Lehigh Valley Health Network, Series 2008A, 5.000%, 7/01/33 - FSA Insured 250 Lehigh County General Purpose Authority, Pennsylvania, 11/14 at 100.00 A 226,978 Revenue Bonds, Good Shepherd Group, Series 2004A, 5.500%, 11/01/24 1,025 Lehigh County General Purpose Authority, Pennsylvania, 11/17 at 100.00 AAA 915,817 Revenue Bonds, Good Shepherd Group, Series 2007, 5.000%, 11/01/37 - AGC Insured 140 Monroe County Hospital Authority, Pennsylvania, Hospital 1/17 at 100.00 A- 101,098 Revenue Bonds, Pocono Medical Center, Series 2007, 5.125%, 1/01/37 2,150 Pennsylvania Higher Educational Facilities Authority, Revenue 1/11 at 101.00 AA- 2,046,112 Bonds, UPMC Health System, Series 2001A, 6.000%, 1/15/31 25 Pottsville Hospital Authority, Pennsylvania, Hospital Revenue 1/09 at 100.00 BB- 18,137 Bonds, Pottsville Hospital and Warne Clinic, Series 1998, 5.625%, 7/01/24 215 Sayre Healthcare Facility Authority, Pennsylvania, Revenue 12/17 at 100.00 A 110,725 Bonds, Guthrie Healthcare System, Series 2007, 4.263%, 12/01/31 - AMBAC Insured 1,000 Washington County Hospital Authority, Pennsylvania, 6/12 at 101.00 A3 967,560 Revenue Bonds, Monongahela Valley Hospital Project, Series 2002, 5.500%, 6/01/17 750 West Shore Area Hospital Authority, Cumberland County, 1/12 at 100.00 BBB 637,470 Pennsylvania, Hospital Revenue Bonds, Holy Spirit Hospital of the Sisters of Christian Charity Project, Series 2001, 6.250%, 1/01/32 ------------------------------------------------------------------------------------------------------------------------------------ 10,205 Total Health Care 9,061,457 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 1.5% (1.0% OF TOTAL INVESTMENTS) 700 Pennsylvania Higher Educational Facilities Authority, 7/15 at 100.00 BBB- 542,612 Revenue Bonds, Slippery Rock University Foundation Inc., Student Housing Project, Series 2005A, 5.000%, 7/01/37 - SYNCORA GTY Insured 100 Philadelphia Authority for Industrial Development, 5/15 at 102.00 Baa2 74,575 Pennsylvania, Multifamily Housing Revenue Bonds, Presbyterian Homes Germantown - Morrisville Project, Series 2005A, 5.625%, 7/01/35 ------------------------------------------------------------------------------------------------------------------------------------ 800 Total Housing/Multifamily 617,187 ------------------------------------------------------------------------------------------------------------------------------------ 62 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 8.1% (5.1% OF TOTAL INVESTMENTS) $ 1,495 Allegheny County Residential Finance Authority, Pennsylvania, 11/08 at 102.00 Aaa $ 1,249,641 GNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Bonds, Series 1998DD-2, 5.400%, 11/01/29 (Alternative Minimum Tax) 500 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 359,830 Mortgage Revenue Bonds, Series 1995A, 4.900%, 10/01/37 (Alternative Minimum Tax) 480 Pennsylvania Housing Finance Agency, Single Family 4/15 at 100.00 AA+ 383,712 Mortgage Revenue Bonds, Series 2006-93A, 4.950%, 10/01/26 (Alternative Minimum Tax) 700 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 531,202 Mortgage Revenue Bonds, Series 2006-94A, 5.150%, 10/01/37 (Alternative Minimum Tax) 430 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 317,529 Mortgage Revenue Bonds, Series 2007-98A, 4.850%, 10/01/31 (Alternative Minimum Tax) 450 Pennsylvania Housing Finance Agency, Single Family 10/17 at 100.00 AA+ 398,205 Mortgage Revenue Bonds, Series 2008-103-C, 5.450%, 10/01/38 ------------------------------------------------------------------------------------------------------------------------------------ 4,055 Total Housing/Single Family 3,240,119 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 7.2% (4.6% OF TOTAL INVESTMENTS) 2,000 Pennsylvania Economic Development Financing Authority, 5/11 at 101.00 A2 1,616,760 Exempt Facilities Revenue Bonds, Amtrak Project, Series 2001A, 6.250%, 11/01/31 (Alternative Minimum Tax) 1,250 Pennsylvania Industrial Development Authority, Economic 7/12 at 101.00 AA 1,268,575 Development Revenue Bonds, Series 2002, 5.500%, 7/01/17 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 3,250 Total Industrials 2,885,335 ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 18.2% (11.5% OF TOTAL INVESTMENTS) Bucks County Industrial Development Authority, Pennsylvania, Revenue Bonds, Lutheran Community at Telford Center, Series 2007: 220 5.750%, 1/01/27 1/17 at 100.00 N/R 159,280 360 5.750%, 1/01/37 1/17 at 100.00 N/R 241,369 265 Cumberland County Municipal Authority, Pennsylvania, 1/17 at 100.00 N/R 184,891 Revenue Bonds, Diakon Lutheran Social Ministries, Series 2007, 5.000%, 1/01/36 200 Lancaster County Hospital Authority, Pennsylvania, 11/16 at 100.00 A+ 147,322 Health Center Revenue Bonds, Masonic Homes Project, Series 2006, 5.000%, 11/01/36 2,100 Lancaster County Hospital Authority, Pennsylvania, Health 12/11 at 100.00 A- 1,842,309 Center Revenue Bonds, Willow Valley Retirement Communities Project, Series 2001, 5.875%, 6/01/31 185 Lancaster County Hospital Authority, Pennsylvania, 7/17 at 100.00 N/R 146,189 Revenue Bonds, Brethren Village Project, Series 2008A, 6.375%, 7/01/30 785 Lebanon County Health Facilities Authority, Pennsylvania, 12/14 at 100.00 N/R 543,032 Health Center Revenue Bonds, Pleasant View Retirement Community, Series 2005A, 5.300%, 12/15/26 Pennsylvania Economic Development Financing Authority, Revenue Bonds, Northwestern Human Services Inc., Series 1998A: 1,240 5.250%, 6/01/14 12/08 at 100.00 BB+ 1,064,900 50 5.125%, 6/01/18 12/08 at 100.00 BB+ 38,191 Philadelphia Authority for Industrial Development, Pennsylvania, Revenue Bonds, Philadelphia Corporation for the Aging Project, Series 2001B: 670 5.250%, 7/01/23 - AMBAC Insured 7/11 at 101.00 AA 592,092 2,875 5.250%, 7/01/31 - AMBAC Insured 7/11 at 101.00 AA 2,360,461 ------------------------------------------------------------------------------------------------------------------------------------ 8,950 Total Long-Term Care 7,320,036 ------------------------------------------------------------------------------------------------------------------------------------ 63 NXM Nuveen Pennsylvania Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ MATERIALS - 4.1% (2.6% OF TOTAL INVESTMENTS) $ 350 Allegheny County Industrial Development Authority, No Opt. Call Baa3 $ 303,692 Pennsylvania, Revenue Bonds, United States Steel Corporation, Series 2005, 5.500%, 11/01/16 210 Bradford County Industrial Development Authority, 12/15 at 100.00 BBB 157,248 Pennsylvania, Solid Waste Disposal Revenue Bonds, International Paper Company, Series 2005B, 5.200%, 12/01/19 (Alternative Minimum Tax) 750 Bucks County Industrial Development Authority, No Opt. Call BBB+ 726,165 Pennsylvania, Environmental Improvement Revenue Bonds, USX Corporation Project, Series 1995, 5.400%, 11/01/17 (Mandatory put 11/01/11) 750 Pennsylvania Economic Development Financing Authority, 11/08 at 102.00 N/R 456,615 Exempt Facilities Revenue Bonds, National Gypsum Company, Series 1997B, 6.125%, 11/01/27 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 2,060 Total Materials 1,643,720 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 14.3% (9.0% OF TOTAL INVESTMENTS) 300 Pennsylvania, General Obligation Bonds, 10/16 at 100.00 AA 311,811 First Series 2006, 5.000%, 10/01/18 375 Philadelphia School District, Pennsylvania, General No Opt. Call Aa3 341,269 Obligation Bonds, Series 2007A, 5.000%, 6/01/34 - FGIC Insured 840 Pine-Richland School District, Pennsylvania, School 7/15 at 100.00 AAA 762,972 Improvement General Obligation Bonds, Series 2005, 5.000%, 7/15/35 - FSA Insured 3,000 Pittsburgh School District, Allegheny County, Pennsylvania, No Opt. Call AAA 3,263,757 General Obligation Refunding Bonds, Series 2002A, 5.500%, 9/01/14 - FSA Insured 2,220 Reading School District, Berks County, Pennsylvania, No Opt. Call AA 497,857 General Obligation Bonds, Series 2003B, 0.000%, 1/15/32 - FGIC Insured 600 York County, Pennsylvania, General Obligation Bonds, 12/15 at 100.00 AA 549,978 Series 2006, 5.000%, 6/01/33 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ 7,335 Total Tax Obligation/General 5,727,644 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 15.1% (9.5% OF TOTAL INVESTMENTS) 1,000 Allegheny County Redevelopment Authority, Pennsylvania, No Opt. Call N/R 762,090 TIF Revenue Bonds, Pittsburg Mills Project, Series 2004, 5.600%, 7/01/23 450 Erie County Convention Center Authority, Pennsylvania, 1/15 at 100.00 AA 390,515 Convention Center Revenue Bonds, Series 2005, 5.000%, 1/15/36 - FGIC Insured 425 Pennsylvania Turnpike Commission, Oil Franchise Tax Senior 12/18 at 100.00 AA 388,344 Lien Revenue Bonds, Series 2003A, 5.000%, 12/01/32 - MBIA Insured 1,000 Pennsylvania Turnpike Commission, Registration Fee No Opt. Call AAA 1,053,400 Revenue Bonds, Series 2005A, 5.250%, 7/15/18 - FSA Insured 1,000 Philadelphia Municipal Authority, Pennsylvania, Lease 11/13 at 100.00 AAA 1,024,850 Revenue Bonds, Series 2003B, 5.250%, 11/15/17 - FSA Insured 1,500 Philadelphia Redevelopment Authority, Pennsylvania, 4/12 at 100.00 AA 1,501,350 Revenue Bonds, Philadelphia Neighborhood Transformation Initiative, Series 2002A, 5.500%, 4/15/19 - FGIC Insured 750 Puerto Rico Highway and Transportation Authority, Highway No Opt. Call AA 632,243 Revenue Bonds, Series 2007N, 5.250%, 7/01/33 - MBIA Insured 630 Puerto Rico Infrastructure Financing Authority, Special No Opt. Call BBB+ 128,192 Tax Revenue Bonds, Series 2005A, 0.000%, 7/01/32 - FGIC Insured 250 Washington County Redevelopment Authority, 7/17 at 100.00 N/R 174,343 Pennsylvania, Tanger Outlet Victory Center Tax Increment Bonds, Series 2006A, 5.450%, 7/01/35 ------------------------------------------------------------------------------------------------------------------------------------ 7,005 Total Tax Obligation/Limited 6,055,327 ------------------------------------------------------------------------------------------------------------------------------------ 64 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 12.4% (7.8% OF TOTAL INVESTMENTS) $ 130 Delaware River Joint Toll Bridge Commission, New Jersey 7/13 at 100.00 A2 $ 132,384 and Pennsylvania, Revenue Bonds, Series 2003, 5.250%, 7/01/17 1,000 Pennsylvania Economic Development Financing Authority, 6/12 at 102.00 BBB 805,480 Revenue Bonds, Amtrak 30th Street Station Parking Garage, Series 2002, 5.875%, 6/01/33 - ACA Insured (Alternative Minimum Tax) 420 Pennsylvania Turnpike Commission, Turnpike Revenue 6/16 at 100.00 AA 406,455 Bonds, Series 2006A, 5.000%, 12/01/24 - AMBAC Insured 1,750 Philadelphia Authority for Industrial Development, 7/11 at 101.00 A+ 1,420,580 Pennsylvania, Airport Revenue Bonds, Philadelphia Airport System Project, Series 2001A, 5.250%, 7/01/28 - FGIC Insured (Alternative Minimum Tax) 2,210 Pittsburgh and Allegheny County Sports and Exhibition 12/08 at 100.00 Aa3 2,080,671 Authority, Pennsylvania, Parking Revenue Bonds, Series 2001A, 5.375%, 12/01/30 - AMBAC Insured 160 Scranton Parking Authority, Pennsylvania, Guaranteed 9/13 at 100.00 AA 123,613 Parking Revenue Bonds, Series 2004, 5.000%, 9/15/33 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ 5,670 Total Transportation 4,969,183 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 16.8% (10.7% OF TOTAL INVESTMENTS) (4) 1,000 Cumberland County Municipal Authority, Pennsylvania, 1/13 at 101.00 N/R (4) 1,161,100 Retirement Community Revenue Bonds, Wesley Affiliated Services Inc., Series 2002A, 7.125%, 1/01/25 (Pre-refunded 1/01/13) 1,105 Oxford Area School District, Chester County, Pennsylvania, 2/12 at 100.00 AA- (4) 1,190,494 General Obligation Bonds, Series 2001A, 5.500%, 2/15/17 (Pre-refunded 2/15/12) - FGIC Insured Philadelphia Gas Works, Pennsylvania, Revenue Bonds, General Ordinance, Fourth Series 1998: 1,000 5.250%, 8/01/18 (Pre-refunded 8/01/13) - FSA Insured 8/13 at 100.00 AAA 1,088,150 1,000 5.250%, 8/01/19 (Pre-refunded 8/01/13) - FSA Insured 8/13 at 100.00 AAA 1,088,150 160 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, No Opt. Call Aaa 186,158 Twelfth Series 1990B, 7.000%, 5/15/20 - MBIA Insured (ETM) 1,700 Philadelphia School District, Pennsylvania, General 8/12 at 100.00 Aa3 (4) 1,853,170 Obligation Bonds, Series 2002B, 5.625%, 8/01/18 (Pre-refunded 8/01/12) - FGIC Insured 170 St. Mary Hospital Authority, Pennsylvania, Health System 11/14 at 100.00 A1 (4) 186,051 Revenue Bonds, Catholic Health East, Series 2004B, 5.375%, 11/15/34 (Pre-refunded 11/15/14) ------------------------------------------------------------------------------------------------------------------------------------ 6,135 Total U.S. Guaranteed 6,753,273 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 4.2% (2.7% OF TOTAL INVESTMENTS) 500 Allegheny County Industrial Development Authority, No Opt. Call Aa3 492,815 Pennsylvania, Pollution Control Revenue Refunding Bonds, Duquesne Light Company, Series 1999A, 4.350%, 12/01/13 - AMBAC Insured 285 Pennsylvania Economic Development Financing Authority, 12/09 at 103.00 Ba3 189,833 Exempt Facilities Revenue Bonds, Reliant Energy Inc., Series 2003A, 6.750%, 12/01/36 (Alternative Minimum Tax) 140 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 9/14 at 100.00 AAA 129,697 General Ordinance, Fifth Series 2004A-1, 5.000%, 9/01/26 - FSA Insured 1,105 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 10/17 at 100.00 AA 879,215 Seventh Series, 2007, 5.000%, 10/01/37 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 2,030 Total Utilities 1,691,560 ------------------------------------------------------------------------------------------------------------------------------------ 65 NXM Nuveen Pennsylvania Dividend Advantage Municipal Fund (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 2.7% (1.7% OF TOTAL INVESTMENTS) $ 500 Bethlehem Authority, Northampton and Lehigh Counties, 11/14 at 100.00 AAA $ 489,110 Pennsylvania, Guaranteed Water Revenue Bonds, Series 2004, 5.000%, 11/15/20 - FSA Insured 600 Harrisburg Authority, Dauphin County, Pennsylvania, 7/14 at 100.00 AAA 582,570 Water Revenue Refunding Bonds, Series 2004, 5.000%, 7/15/22 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 1,100 Total Water and Sewer 1,071,680 ------------------------------------------------------------------------------------------------------------------------------------ $ 72,740 Total Investments (cost $70,668,835) - 158.2% 63,451,574 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 4.1% 1,665,694 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (62.3)% (5) (25,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $40,117,268 ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's) rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (5) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 39.4%. N/R Not rated. (ETM) Escrowed to maturity. See accompanying notes to financial statements. 66 NVY Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 Portfolio of INVESTMENTS October 31, 2008 (Unaudited)
PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 19.8% (12.3% OF TOTAL INVESTMENTS) $ 1,000 Allegheny County Higher Education Building Authority, No Opt. Call Baa3 $ 803,320 Pennsylvania, College Revenue Refunding Bonds, Robert Morris College, Series 1998A, 6.000%, 5/01/28 800 Chester County Health and Education Facilities Authority, 10/15 at 102.00 N/R 598,056 Pennsylvania, Revenue Bonds, Immaculata University, Series 2005, 5.500%, 10/15/25 720 Chester County Industrial Development Authority, 12/17 at 100.00 BB+ 551,822 Pennsylvania, Avon Grove Charter School Revenue Bonds, Series 2007A, 6.375%, 12/15/37 325 Delaware County Authority, Pennsylvania, College Revenue 10/11 at 100.00 BBB 272,932 Refunding Bonds, Neumann College, Series 2001, 6.000%, 10/01/31 450 Delaware County Authority, Pennsylvania, General Revenue 10/16 at 100.00 A3 339,165 Bonds, Eastern University, Series 2006, 4.500%, 10/01/27 - RAAI Insured Delaware County Authority, Pennsylvania, Revenue Bonds, Villanova University, Series 2006: 340 5.000%, 8/01/23 - AMBAC Insured 8/16 at 100.00 AA 330,640 165 5.000%, 8/01/24 - AMBAC Insured 8/16 at 100.00 AA 159,232 1,435 Delaware County Authority, Pennsylvania, Revenue Refunding 8/13 at 100.00 AA 1,449,953 Bonds, Villanova University, Series 2003, 5.250%, 8/01/17 - FGIC Insured 180 Erie Higher Education Building Authority, Pennsylvania, 5/17 at 100.00 BBB+ 139,466 College Revenue Bonds, Gannon University, Series 2007-GG3, 5.000%, 5/01/32 - RAAI Insured 80 New Wilmington, Pennsylvania, Revenue, Westminster 5/17 at 100.00 BBB+ 62,698 College, Series 2007G, 5.125%, 5/01/33 - RAAI Insured 1,050 Pennsylvania Higher Educational Facilities Authority, General 6/18 at 100.00 Aa3 962,378 Revenue Bonds, State System of Higher Education, Series 2008AH, 5.000%, 6/15/33 285 Pennsylvania Higher Educational Facilities Authority, 5/16 at 100.00 A- 232,423 Revenue Bonds, Allegheny College, Series 2006, 4.750%, 5/01/31 610 Pennsylvania Higher Educational Facilities Authority, 11/17 at 100.00 AA 547,036 Revenue Bonds, Drexel University, Series 2007A, 5.000%, 5/01/37 - MBIA Insured 800 Pennsylvania Higher Educational Facilities Authority, 4/16 at 100.00 AA 789,056 Revenue Bonds, Temple University, First Series of 2006, 5.000%, 4/01/21 - MBIA Insured 315 Philadelphia Authority for Industrial Development, 1/17 at 100.00 BBB 332,851 Pennsylvania, Revenue Bonds, Franklin Towne Charter High School, Series 2006A, 5.250%, 1/01/27 530 Philadelphia Authority for Industrial Development, 1/13 at 102.00 BB 341,543 Pennsylvania, Revenue Bonds, Leadership Learning Partners, Series 2005A, 5.375%, 7/01/36 270 Philadelphia Authority for Industrial Development, 5/16 at 100.00 BB+ 206,261 Pennsylvania, Revenue Bonds, Richard Allen Preparatory Charter School, Series 2006, 6.250%, 5/01/33 1,000 Union County, Higher Education Facilities Financing 4/13 at 100.00 Aa2 1,016,090 Authority, Pennsylvania, Revenue Bonds, Bucknell University, Series 2002A, 5.250%, 4/01/20 ------------------------------------------------------------------------------------------------------------------------------------ 10,355 Total Education and Civic Organizations 9,134,922 ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE - 15.4% (9.6% OF TOTAL INVESTMENTS) 625 Allegheny County Hospital Development Authority, 4/15 at 100.00 Baa2 415,219 Pennsylvania, Revenue Bonds, Ohio Valley General Hospital, Series 2005A, 5.125%, 4/01/35 735 Allentown Area Hospital Authority, Pennsylvania, Revenue No Opt. Call BB- 619,634 Bonds, Sacred Heart Hospital, Series 2005, 6.000%, 11/15/16 67 NVY Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ HEALTH CARE (continued) $ 2,000 Chester County Health and Educational Facilities Authority, 11/08 at 101.00 AA- $ 1,861,240 Pennsylvania, Health System Revenue Bonds, Jefferson Health System, Series 1997B, 5.375%, 5/15/27 95 Erie County Hospital Authority, Pennsylvania, Revenue Bonds, 11/17 at 100.00 A- 77,456 Hamot Health Foundation, Series 2007, 5.000%, 11/01/37 - CIFG Insured 270 Fulton County, Pennsylvania, Industrial Development 7/16 at 100.00 N/R 185,344 Authority Hospital Revenue Bonds, Fulton County Medical Center Project, Series 2006, 5.900%, 7/01/40 740 Lehigh County General Purpose Authority, Pennsylvania, 7/18 at 100.00 AAA 663,676 Hospital Revenue Bonds, Lehigh Valley Health Network, Series 2008A, 5.000%, 7/01/33 - FSA Insured 1,155 Lehigh County General Purpose Authority, Pennsylvania, 11/17 at 100.00 AAA 1,031,969 Revenue Bonds, Good Shepherd Group, Series 2007, 5.000%, 11/01/37 - AGC Insured 160 Monroe County Hospital Authority, Pennsylvania, Hospital 1/17 at 100.00 A- 115,541 Revenue Bonds, Pocono Medical Center, Series 2007, 5.125%, 1/01/37 70 Pennsylvania Higher Educational Facilities Authority, 1/11 at 101.00 AA- 66,618 Revenue Bonds, UPMC Health System, Series 2001A, 6.000%, 1/15/31 245 Sayre Healthcare Facility Authority, Pennsylvania, Revenue 12/17 at 100.00 A 126,175 Bonds, Guthrie Healthcare System, Series 2007, 4.263%, 12/01/31 - AMBAC Insured 1,450 Washington County Hospital Authority, Pennsylvania, Revenue 6/12 at 101.00 A3 1,409,893 Bonds, Monongahela Valley Hospital Project, Series 2002, 6.250%, 6/01/22 West Shore Area Hospital Authority, Cumberland County, Pennsylvania, Hospital Revenue Bonds, Holy Spirit Hospital of the Sisters of Christian Charity Project, Series 2001: 25 6.150%, 1/01/21 1/12 at 100.00 BBB 23,026 600 6.250%, 1/01/32 1/12 at 100.00 BBB 509,976 ------------------------------------------------------------------------------------------------------------------------------------ 8,170 Total Health Care 7,105,767 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 1.5% (1.0% OF TOTAL INVESTMENTS) 800 Pennsylvania Higher Educational Facilities Authority, 7/15 at 100.00 BBB- 620,128 Revenue Bonds, Slippery Rock University Foundation Inc., Student Housing Project, Series 2005A, 5.000%, 7/01/37 - SYNCORA GTY Insured 120 Philadelphia Authority for Industrial Development, 5/15 at 102.00 Baa2 89,490 Pennsylvania, Multifamily Housing Revenue Bonds, Presbyterian Homes Germantown - Morrisville Project, Series 2005A, 5.625%, 7/01/35 ------------------------------------------------------------------------------------------------------------------------------------ 920 Total Housing/Multifamily 709,618 ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 6.6% (4.1% OF TOTAL INVESTMENTS) 500 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 359,830 Mortgage Revenue Bonds, Series 1995A, 4.900%, 10/01/37 (Alternative Minimum Tax) 550 Pennsylvania Housing Finance Agency, Single Family 4/15 at 100.00 AA+ 439,670 Mortgage Revenue Bonds, Series 2006-93A, 4.950%, 10/01/26 (Alternative Minimum Tax) 800 Pennsylvania Housing Finance Agency, Single Family 10/15 at 100.00 AA+ 607,088 Mortgage Revenue Bonds, Series 2006-94A, 5.150%, 10/01/37 (Alternative Minimum Tax) 1,100 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 817,025 Mortgage Revenue Bonds, Series 2007-97A, 4.600%, 10/01/27 (Alternative Minimum Tax) 480 Pennsylvania Housing Finance Agency, Single Family 10/16 at 100.00 AA+ 354,451 Mortgage Revenue Bonds, Series 2007-98A, 4.850%, 10/01/31 (Alternative Minimum Tax) 500 Pennsylvania Housing Finance Agency, Single Family 10/17 at 100.00 AA+ 442,450 Mortgage Revenue Bonds, Series 2008-103-C, 5.450%, 10/01/38 ------------------------------------------------------------------------------------------------------------------------------------ 3,930 Total Housing/Single Family 3,020,514 ------------------------------------------------------------------------------------------------------------------------------------ INDUSTRIALS - 6.6% (4.1% OF TOTAL INVESTMENTS) 3,000 Pennsylvania Industrial Development Authority, Economic 7/12 at 101.00 AA 3,046,560 Development Revenue Bonds, Series 2002, 5.500%, 7/01/19 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 68 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 7.1% (4.4% OF TOTAL INVESTMENTS) Bucks County Industrial Development Authority, Pennsylvania, Revenue Bonds, Lutheran Community at Telford Center, Series 2007: $ 250 5.750%, 1/01/27 1/17 at 100.00 N/R $ 181,000 400 5.750%, 1/01/37 1/17 at 100.00 N/R 268,188 300 Cumberland County Municipal Authority, Pennsylvania, 1/17 at 100.00 N/R 209,310 Revenue Bonds, Diakon Lutheran Social Ministries, Series 2007, 5.000%, 1/01/36 205 Lancaster County Hospital Authority, Pennsylvania, 11/16 at 100.00 A+ 151,005 Health Center Revenue Bonds, Masonic Homes Project, Series 2006, 5.000%, 11/01/36 185 Lancaster County Hospital Authority, Pennsylvania, 7/17 at 100.00 N/R 146,189 Revenue Bonds, Brethren Village Project, Series 2008A, 6.375%, 7/01/30 785 Lebanon County Health Facilities Authority, Pennsylvania, 12/14 at 100.00 N/R 543,032 Health Center Revenue Bonds, Pleasant View Retirement Community, Series 2005A, 5.300%, 12/15/26 Pennsylvania Economic Development Financing Authority, Revenue Bonds, Northwestern Human Services Inc., Series 1998A: 1,260 5.250%, 6/01/14 12/08 at 100.00 BB+ 1,082,075 50 5.125%, 6/01/18 12/08 at 100.00 BB+ 38,191 750 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AA 662,790 Pennsylvania, Revenue Bonds, Philadelphia Corporation for the Aging Project, Series 2001B, 5.250%, 7/01/23 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 4,185 Total Long-Term Care 3,281,780 ------------------------------------------------------------------------------------------------------------------------------------ MATERIALS - 4.3% (2.7% OF TOTAL INVESTMENTS) 400 Allegheny County Industrial Development Authority, No Opt. Call Baa3 347,076 Pennsylvania, Revenue Bonds, United States Steel Corporation, Series 2005, 5.500%, 11/01/16 280 Bradford County Industrial Development Authority, 12/15 at 100.00 BBB 209,664 Pennsylvania, Solid Waste Disposal Revenue Bonds, International Paper Company, Series 2005B, 5.200%, 12/01/19 (Alternative Minimum Tax) 1,000 Bucks County Industrial Development Authority, No Opt. Call BBB+ 968,220 Pennsylvania, Environmental Improvement Revenue Bonds, USX Corporation Project, Series 1995, 5.400%, 11/01/17 (Mandatory put 11/01/11) 750 Pennsylvania Economic Development Financing Authority, 11/08 at 102.00 N/R 456,615 Exempt Facilities Revenue Bonds, National Gypsum Company, Series 1997B, 6.125%, 11/01/27 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 2,430 Total Materials 1,981,575 ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 22.4% (13.9% OF TOTAL INVESTMENTS) 1,740 Butler County, Pennsylvania, Butler Area School District, 10/12 at 100.00 AA 1,701,755 General Obligation Bonds, Series 2002A, 5.375%, 10/01/26 - FGIC Insured 4,000 Delaware Valley Regional Finance Authority, Pennsylvania, No Opt. Call Aa2 4,240,356 Local Government Revenue Bonds, Series 2002, 5.750%, 7/01/17 Greensburg Salem School District, Westmoreland County, Pennsylvania, General Obligation Refunding Bonds, Series 2002: 725 5.375%, 9/15/15 - FGIC Insured 9/12 at 100.00 AA 757,727 1,000 5.375%, 9/15/16 - FGIC Insured 9/12 at 100.00 AA 1,045,140 375 Philadelphia School District, Pennsylvania, General No Opt. Call Aa3 341,269 Obligation Bonds, Series 2007A, 5.000%, 6/01/34 - FGIC Insured 950 Pine-Richland School District, Pennsylvania, School 7/15 at 100.00 AAA 862,885 Improvement General Obligation Bonds, Series 2005, 5.000%, 7/15/35 - FSA Insured 225 Pittsburgh, Pennsylvania, General Obligation Bonds, No Opt. Call AAA 236,720 Series 2006B, 5.250%, 9/01/16 - FSA Insured 2,510 Reading School District, Berks County, Pennsylvania, No Opt. Call AA 562,893 General Obligation Bonds, Series 2003B, 0.000%, 1/15/32 - FGIC Insured 600 York County, Pennsylvania, General Obligation Bonds, 12/15 at 100.00 AA 549,978 Series 2006, 5.000%, 6/01/33 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ 12,125 Total Tax Obligation/General 10,298,723 ------------------------------------------------------------------------------------------------------------------------------------ 69 NVY Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 25.5% (15.8% OF TOTAL INVESTMENTS) $ 1,000 Allegheny County Redevelopment Authority, Pennsylvania, No Opt. Call N/R $ 762,090 TIF Revenue Bonds, Pittsburg Mills Project, Series 2004, 5.600%, 7/01/23 2,000 Grove City Area Hospital Authority, Mercer County, 3/12 at 100.00 AA 1,759,100 Pennsylvania, Revenue Bonds, County Guaranteed, Woodland Place Project, Series 2002, 5.400%, 3/01/31 - FGIC Insured 4,000 Harrisburg Parking Authority, Pennsylvania, Guaranteed 9/11 at 100.00 A2 3,822,680 Revenue Refunding Bonds, Series 2001J, 5.000%, 9/01/22 - MBIA Insured 485 Pennsylvania Turnpike Commission, Oil Franchise Tax Senior 12/18 at 100.00 AA 443,169 Lien Revenue Bonds, Series 2003A, 5.000%, 12/01/32 - MBIA Insured (4) 1,200 Pennsylvania Turnpike Commission, Registration Fee No Opt. Call AAA 1,264,080 Revenue Bonds, Series 2005A, 5.250%, 7/15/18 - FSA Insured Philadelphia Redevelopment Authority, Pennsylvania, Revenue Bonds, Philadelphia Neighborhood Transformation Initiative, Series 2002A: 1,000 5.500%, 4/15/18 - FGIC Insured 4/12 at 100.00 AA 1,006,120 1,750 5.500%, 4/15/22 - FGIC Insured 4/12 at 100.00 AA 1,699,775 800 Puerto Rico Highway and Transportation Authority, Highway No Opt. Call AA 674,392 Revenue Bonds, Series 2007N, 5.250%, 7/01/33 - MBIA Insured 710 Puerto Rico Infrastructure Financing Authority, Special Tax No Opt. Call BBB+ 144,471 Revenue Bonds, Series 2005A, 0.000%, 7/01/32 - FGIC Insured 250 Washington County Redevelopment Authority, Pennsylvania, 7/17 at 100.00 N/R 174,343 Tanger Outlet Victory Center Tax Increment Bonds, Series 2006A, 5.450%, 7/01/35 ------------------------------------------------------------------------------------------------------------------------------------ 13,195 Total Tax Obligation/Limited 11,750,220 ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 5.5% (3.4% OF TOTAL INVESTMENTS) 130 Delaware River Joint Toll Bridge Commission, New Jersey 7/13 at 100.00 A2 132,384 and Pennsylvania, Revenue Bonds, Series 2003, 5.250%, 7/01/17 1,000 Pennsylvania Economic Development Financing Authority, 6/12 at 102.00 BBB 805,480 Revenue Bonds, Amtrak 30th Street Station Parking Garage, Series 2002, 5.875%, 6/01/33 - ACA Insured (Alternative Minimum Tax) 670 Pennsylvania Turnpike Commission, Turnpike Revenue 6/16 at 100.00 AA 648,393 Bonds, Series 2006A, 5.000%, 12/01/24 - AMBAC Insured 180 Scranton Parking Authority, Pennsylvania, Guaranteed 9/13 at 100.00 AA 139,064 Parking Revenue Bonds, Series 2004, 5.000%, 9/15/33 - FGIC Insured 1,000 Susquehanna Area Regional Airport Authority, Pennsylvania, 1/13 at 100.00 Aa3 788,840 Airport System Revenue Bonds, Series 2003A, 5.000%, 1/01/28 - AMBAC Insured (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ 2,980 Total Transportation 2,514,161 ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 34.0% (21.1% OF TOTAL INVESTMENTS) (5) 2,000 Adams County, Pennsylvania, General Obligation Bonds, 5/11 at 100.00 N/R (5) 2,136,040 Series 2001, 5.500%, 11/15/26 (Pre-refunded 5/15/11) - FGIC Insured 100 Allegheny County Hospital Development Authority, 11/10 at 102.00 AAA 114,033 Pennsylvania, Revenue Bonds, West Penn Allegheny Health System, Series 2000B, 9.250%, 11/15/22 (Pre-refunded 11/15/10) 1,155 Bucks County Industrial Development Authority, 10/12 at 101.00 N/R (5) 1,280,398 Pennsylvania, Revenue Bonds, Pennswood Village Project, Series 2002A, 6.000%, 10/01/34 (Pre-refunded 10/01/12) 1,000 Cumberland County Municipal Authority, Pennsylvania, 1/13 at 101.00 N/R (5) 1,161,100 Retirement Community Revenue Bonds, Wesley Affiliated Services Inc., Series 2002A, 7.125%, 1/01/25 (Pre-refunded 1/01/13) 1,100 Luzerne County, Pennsylvania, General Obligation Bonds, 11/12 at 57.97 Baa1 (5) 551,144 Series 2002B, 0.000%, 11/15/21 (Pre-refunded 11/15/12) - MBIA Insured 2,945 Pennsylvania Turnpike Commission, Registration Fee Revenue 7/11 at 101.00 AA (5) 3,181,749 Bonds, Series 2001, 5.500%, 7/15/33 (Pre-refunded 7/15/11) - AMBAC Insured 2,000 Philadelphia Authority for Industrial Development, 10/11 at 101.00 AAA 2,141,640 Pennsylvania, Lease Revenue Bonds, Series 2001B, 5.125%, 10/01/26 (Pre-refunded 10/01/11) - FSA Insured 70 PRINCIPAL OPTIONAL CALL AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED (5) (continued) $ 2,420 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 8/13 at 100.00 AAA $ 2,633,323 General Ordinance, Fourth Series 1998, 5.250%, 8/01/20 (Pre-refunded 8/01/13) - FSA Insured 65 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, No Opt. Call Aaa 75,627 Twelfth Series 1990B, 7.000%, 5/15/20 - MBIA Insured (ETM) 2,000 Philadelphia School District, Pennsylvania, General 2/12 at 100.00 AAA 2,153,320 Obligation Bonds, Series 2002A, 5.500%, 2/01/31 (Pre-refunded 2/01/12) - FSA Insured 225 St. Mary Hospital Authority, Pennsylvania, Health System 11/14 at 100.00 A1 (5) 246,245 Revenue Bonds, Catholic Health East, Series 2004B, 5.375%, 11/15/34 (Pre-refunded 11/15/14) ------------------------------------------------------------------------------------------------------------------------------------ 15,010 Total U.S. Guaranteed 15,674,619 ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 2.9% (1.8% OF TOTAL INVESTMENTS) 315 Pennsylvania Economic Development Financing Authority, 12/09 at 103.00 Ba3 209,815 Exempt Facilities Revenue Bonds, Reliant Energy Inc., Series 2003A, 6.750%, 12/01/36 (Alternative Minimum Tax) 145 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 9/14 at 100.00 AAA 134,329 General Ordinance, Fifth Series 2004A-1, 5.000%, 9/01/26 - FSA Insured 1,240 Philadelphia Gas Works, Pennsylvania, Revenue Bonds, 10/17 at 100.00 AA 986,631 Seventh Series, 2007, 5.000%, 10/01/37 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ 1,700 Total Utilities 1,330,775 ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 9.3% (5.8% OF TOTAL INVESTMENTS) 4,500 Bucks County Industrial Development Authority, 3/12 at 100.00 AA- 3,685,680 Pennsylvania, Water Facility Revenue Bonds, Pennsylvania Suburban Water Company, Series 2002, 5.550%, 9/01/32 - FGIC Insured (Alternative Minimum Tax) 600 Harrisburg Authority, Dauphin County, Pennsylvania, 7/14 at 100.00 AAA 582,570 Water Revenue Refunding Bonds, Series 2004, 5.000%, 7/15/22 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ 5,100 Total Water and Sewer 4,268,250 ------------------------------------------------------------------------------------------------------------------------------------ $ 83,100 Total Investments (cost $80,789,985) - 160.9% 74,117,484 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.0% 438,051 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (61.9)% (6) (28,500,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $46,055,535 ====================================================================================================================
71 NVY Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (continued) Portfolio of INVESTMENTS October 31, 2008 (Unaudited) FUTURES CONTRACTS OUTSTANDING AT OCTOBER 31, 2008:
UNREALIZED CONTRACT NUMBER OF CONTRACT VALUE AT APPRECIATION TYPE POSITION CONTRACTS EXPIRATION OCTOBER 31, 2008 (DEPRECIATION) -------------------------------------------------------------------------------------------------------------------- U.S. Treasury Bond Long 20 12/08 $2,262,500 $ (87,082) ====================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted. (2) Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. (3) Ratings: Using the higher of Standard & Poor's Group ("Standard & Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings below BBB by Standard & Poor's or Baa by Moody's are considered to be below investment grade. The Portfolio of Investments may reflect the ratings on certain bonds insured by ACA, AGC, AMBAC, CIFG, FGIC, FSA, MBIA, RAAI and SYNCORA as of October 31, 2008. Please see the Portfolio Manager's Commentary for an expanded discussion of the affect on the Fund of changes to the ratings of certain bonds in the portfolio resulting from changes to the ratings of the underlying insurers both during the period and after period end. (4) Portion of investment has been pledged to collateralize the net payment obligations under futures contracts. (5) Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. (6) Preferred Shares, at Liquidation Value as a percentage of Total Investments is 38.5%. N/R Not rated. (ETM) Escrowed to maturity. See accompanying notes to financial statements. 72 Statement of ASSETS & LIABILITIES October 31, 2008 (Unaudited)
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments, at value (cost $432,751,083, $256,180,716, $136,372,034 and $96,425,385, respectively) $391,473,060 $237,303,835 $121,556,055 $86,433,657 Cash 14,164,538 5,290,548 3,350,826 1,163,574 Deposits with brokers for open futures contracts -- 41,089 -- -- Receivables: Interest 6,961,582 3,849,699 2,196,949 1,561,406 Investments sold 505,000 -- 415,000 190,000 Other assets 59,658 35,470 5,959 5,790 ------------------------------------------------------------------------------------------------------------------------------------ Total assets 413,163,838 246,520,641 127,524,789 89,354,427 ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft -- -- -- -- Floating rate obligations -- -- -- -- Payables: Investments purchased -- -- -- -- Variation margin on futures contracts -- 58,188 -- -- Common share dividends 960,430 529,546 341,502 249,663 Preferred share dividends 49,064 13,142 12,181 5,650 Accrued expenses: Management fees 222,435 133,726 53,874 34,098 Other 135,978 85,133 32,407 25,803 ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 1,367,907 819,735 439,964 315,214 ------------------------------------------------------------------------------------------------------------------------------------ Preferred shares, at liquidation value 162,000,000 91,600,000 48,000,000 34,500,000 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $249,795,931 $154,100,906 $ 79,084,825 $54,539,213 ==================================================================================================================================== Common shares outstanding 20,484,322 12,049,496 6,577,112 4,523,121 ==================================================================================================================================== Net asset value per Common share outstanding (net assets applicable to Common shares, divided by Common shares outstanding) $ 12.19 $ 12.79 $ 12.02 $ 12.06 ==================================================================================================================================== NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF: ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 204,843 $ 120,495 $ 65,771 $ 45,231 Paid-in surplus 289,027,855 172,022,510 93,390,241 64,152,098 Undistributed (Over-distribution of) net investment income (732,505) (424,178) (211,266) (103,382) Accumulated net realized gain (loss) from investments and derivative transactions 2,573,761 1,472,311 656,058 436,994 Net unrealized appreciation (depreciation) of investments and derivative transactions (41,278,023) (19,090,232) (14,815,979) (9,991,728) ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $249,795,931 $154,100,906 $ 79,084,825 $54,539,213 ==================================================================================================================================== Authorized shares: Common 200,000,000 200,000,000 Unlimited Unlimited Preferred 1,000,000 1,000,000 Unlimited Unlimited ====================================================================================================================================
See accompanying notes to financial statements. 73 Statement of ASSETS & LIABILITIES (continued) October 31, 2008 (Unaudited)
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments, at value (cost $362,178,614, $317,316,745 $70,668,835 and $80,789,985, respectively) $333,292,706 $284,810,627 $63,451,574 $74,117,484 Cash 12,180,568 7,709,009 824,368 -- Deposits with brokers for open futures contracts -- -- -- 14,885 Receivables: Interest 5,609,406 5,594,257 1,203,462 1,161,152 Investments sold 200,000 60,000 60,000 65,000 Other assets 48,431 41,261 5,681 5,771 ------------------------------------------------------------------------------------------------------------------------------------ Total assets 351,331,111 298,215,154 65,545,085 75,364,292 ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft -- -- -- 285,063 Floating rate obligations 21,310,000 -- -- -- Payables: Investments purchased 842,988 842,988 194,479 221,304 Variation margin on futures contracts -- -- -- 23,750 Common share dividends 772,523 715,064 178,253 209,450 Preferred share dividends 19,519 32,685 6,347 10,854 Accrued expenses: Management fees 176,838 160,731 27,786 28,477 Other 128,276 106,980 20,952 29,859 ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 23,250,144 1,858,448 427,817 808,757 ------------------------------------------------------------------------------------------------------------------------------------ Preferred shares, at liquidation value 132,000,000 118,100,000 25,000,000 28,500,000 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $196,080,967 $178,256,706 $40,117,268 $46,055,535 ==================================================================================================================================== Common shares outstanding 16,161,598 15,670,651 3,332,584 3,725,809 ==================================================================================================================================== Net asset value per Common share outstanding (net assets applicable to Common shares, divided by Common shares outstanding) $ 12.13 $ 11.38 $ 12.04 $ 12.36 ==================================================================================================================================== NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF: ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 161,616 $ 156,707 $ 33,326 $ 37,258 Paid-in surplus 228,889,752 214,507,972 47,308,739 52,811,188 Undistributed (Over-distribution of) net investment income (476,252) 241,029 (45,264) (24,126) Accumulated net realized gain (loss) from investments and derivative transactions (3,608,241) (4,142,884) 37,728 (9,202) Net unrealized appreciation (depreciation) of investments and derivative transactions (28,885,908) (32,506,118) (7,217,261) (6,759,583) ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $196,080,967 $178,256,706 $40,117,268 $46,055,535 ==================================================================================================================================== Authorized shares: Common Unlimited Unlimited Unlimited Unlimited Preferred Unlimited Unlimited Unlimited Unlimited ====================================================================================================================================
See accompanying notes to financial statements. 74 Statement of OPERATIONS Six Months Ended October 31, 2008 (Unaudited)
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $ 11,125,048 $ 6,384,570 $ 3,455,071 $ 2,455,951 ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 1,395,103 834,726 443,754 311,724 Preferred shares - auction fees 204,165 115,441 60,493 43,479 Preferred shares - dividend disbursing agent fees 15,110 15,105 5,041 5,041 Shareholders' servicing agent fees and expenses 16,133 9,743 793 818 Interest expense on floating rate obligations -- -- -- -- Custodian's fees and expenses 34,419 27,772 14,157 12,039 Directors'/Trustees' fees and expenses 4,311 2,758 1,380 964 Professional fees 18,227 12,382 8,733 7,459 Shareholders' reports - printing and mailing expenses 29,750 18,146 11,558 9,251 Stock exchange listing fees 4,635 4,635 468 322 Investor relations expense 28,179 16,526 8,746 6,150 Other expenses 15,522 9,709 8,403 7,407 ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit and expense reimbursement 1,765,554 1,066,943 563,526 404,654 Custodian fee credit (24,556) (20,735) (6,520) (6,729) Expense reimbursement -- -- (104,449) (97,645) ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 1,740,998 1,046,208 452,557 300,280 ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 9,384,050 5,338,362 3,002,514 2,155,671 ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) Net realized gain (loss) from: Investments (703) (95,813) 171,665 (4,589) Futures -- 166,151 -- -- Change in net unrealized appreciation (depreciation) of: Investments (41,946,638) (21,793,298) (14,761,201) (10,287,834) Futures -- (213,351) -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net realized and unrealized gain (loss) (41,947,341) (21,936,311) (14,589,536) (10,292,423) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS From net investment income (3,136,756) (1,771,003) (919,738) (667,733) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Preferred shareholders (3,136,756) (1,771,003) (919,738) (667,733) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations $(35,700,047) $(18,368,952) $(12,506,760) $ (8,804,485) ====================================================================================================================================
See accompanying notes to financial statements. 75 Statement of OPERATIONS (continued) Six Months Ended October 31, 2008 (Unaudited)
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $ 9,520,205 $ 8,615,227 $ 1,881,100 $ 2,113,573 ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 1,121,463 1,025,442 229,660 259,376 Preferred shares - auction fees 166,356 148,838 31,507 35,918 Preferred shares - dividend disbursing agent fees 15,094 15,109 5,041 5,041 Shareholders' servicing agent fees and expenses 17,321 15,113 907 804 Interest expense on floating rate obligations 286,800 84,390 -- -- Custodian's fees and expenses 44,016 32,002 14,316 20,514 Directors'/Trustees' fees and expenses 3,681 2,154 730 816 Professional fees 14,379 14,468 6,686 6,942 Shareholders' reports - printing and mailing expenses 28,634 26,163 7,841 8,599 Stock exchange listing fees 4,635 4,635 237 265 Investor relations expense 24,082 22,264 4,948 5,786 Other expenses 13,255 9,552 7,577 7,706 ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit and expense reimbursement 1,739,716 1,400,130 309,450 351,767 Custodian fee credit (10,561) (25,586) (2,600) (759) Expense reimbursement -- -- (53,955) (81,246) ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 1,729,155 1,374,544 252,895 269,762 ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 7,791,050 7,240,683 1,628,205 1,843,811 ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) Net realized gain (loss) from: Investments (671,608) (2,641,807) 153,952 (95,877) Futures -- -- -- 66,461 Change in net unrealized appreciation (depreciation) of: Investments (35,616,041) (34,572,641) (8,247,548) (7,824,725) Futures -- -- -- (87,082) ------------------------------------------------------------------------------------------------------------------------------------ Net realized and unrealized gain (loss) (36,287,649) (37,214,448) (8,093,596) (7,941,223) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS From net investment income (2,551,975) (2,289,259) (479,030) (550,933) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Preferred shareholders (2,551,975) (2,289,259) (479,030) (550,933) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations $(31,048,574) $(32,263,024) $(6,944,421) $(6,648,345) ====================================================================================================================================
See accompanying notes to financial statements. 76 Statement of CHANGES in NET ASSETS (Unaudited)
NEW JERSEY NEW JERSEY INVESTMENT QUALITY (NQJ) PREMIUM INCOME (NNJ) --------------------------- ---------------------------- SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 9,384,050 $ 18,787,832 $ 5,338,362 $ 10,807,974 Net realized gain (loss) from: Investments (703) 1,697,124 (95,813) 1,002,315 Forward swaps -- 1,271,098 -- 560,840 Futures -- -- 166,151 -- Change in net unrealized appreciation (depreciation) of: Investments (41,946,638) (16,370,030) (21,793,298) (7,924,293) Forward swaps -- (2,853) -- (984) Futures -- -- (213,351) -- Distributions to Preferred Shareholders: From net investment income (3,136,756) (5,356,071) (1,771,003) (3,012,048) From accumulated net realized gains -- (225,437) -- (175,613) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations (35,700,047) (198,337) (18,368,952) 1,258,191 ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (6,698,373) (13,396,750) (3,904,037) (7,926,161) From accumulated net realized gains -- (612,481) -- (497,644) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (6,698,373) (14,009,231) (3,904,037) (8,423,805) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions -- -- -- -- Repurchased -- -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions -- -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (42,398,420) (14,207,568) (22,272,989) (7,165,614) Net assets applicable to Commo shares at the beginning of period 292,194,351 306,401,919 176,373,895 183,539,509 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $249,795,931 $292,194,351 $154,100,906 $176,373,895 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of period $ (732,505) $ (281,426) $ (424,178) $ (87,500) ====================================================================================================================================
See accompanying notes to financial statements. 77 Statement of CHANGES in NET ASSETS (continued) (Unaudited)
NEW JERSEY NEW JERSEY DIVIDEND ADVANTAGE (NXJ) DIVIDEND ADVANTAGE 2 (NUJ) --------------------------- ---------------------------- SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 3,002,514 $ 6,154,007 $ 2,155,671 $ 4,379,414 Net realized gain (loss) from: Investments 171,665 222,219 (4,589) 667,227 Forward swaps -- 372,082 -- 194,404 Futures -- -- -- -- Change in net unrealized appreciation (depreciation) of: Investments (14,761,201) (5,887,711) (10,287,834) (4,419,598) Forward swaps -- (590) -- (295) Futures -- -- -- -- Distributions to Preferred Shareholders: From net investment income (919,738) (1,639,115) (667,733) (1,046,557) From accumulated net realized gains -- (53,203) -- (214,756) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations (12,506,760) (832,311) (8,804,485) (440,161) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (2,170,447) (4,465,787) (1,560,477) (3,231,672) From accumulated net realized gains -- (176,924) -- (685,253) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (2,170,447) (4,642,711) (1,560,477) (3,916,925) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions -- 34,444 -- 23,495 Repurchased -- -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions -- 34,444 -- 23,495 ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (14,677,207) (5,440,578) (10,364,962) (4,333,591) Net assets applicable to Common shares at the beginning of period 93,762,032 99,202,610 64,904,175 69,237,766 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $ 79,084,825 $93,762,032 $ 54,539,213 $64,904,175 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of period $ (211,266) $ (123,595) $ (103,382) $ (30,843) ====================================================================================================================================
See accompanying notes to financial statements. 78
PENNSYLVANIA INVESTMENT PENNSYLVANIA PREMIUM QUALITY (NQP) INCOME 2 (NPY) --------------------------- ---------------------------- SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 7,791,050 $ 15,437,317 $ 7,240,683 $ 14,156,508 Net realized gain (loss) from: Investments (671,608) (700,898) (2,641,807) (976,106) Forward swaps -- (1,940,455) -- (524,955) Futures -- -- -- -- Change in net unrealized appreciation (depreciation) of: Investments (35,616,041) (11,038,711) (34,572,641) (13,138,981) Forward swaps -- 340,646 -- (181,467) Futures -- -- -- -- Distributions to Preferred Shareholders: From net investment income (2,551,975) (4,735,546) (2,289,259) (4,100,251) From accumulated net realized gains -- -- -- (267,657) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations (31,048,574) (2,637,647) (32,263,024) (5,032,909) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (5,397,975) (10,625,493) (4,732,538) (9,656,362) From accumulated net realized gains -- -- -- (688,161) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (5,397,975) (10,625,493) (4,732,538) (10,344,523) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions -- -- -- -- Repurchased -- (1,853,014) -- (2,020,258) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions -- (1,853,014) -- (2,020,258) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (36,446,549) (15,116,154) (36,995,562) (17,397,690) Net assets applicable to Common shares at the beginning of period 232,527,516 247,643,670 215,252,268 232,649,958 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $196,080,967 $232,527,516 $178,256,706 $215,252,268 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of period $ (476,252) $ (317,352) $ 241,029 $ 22,143 ====================================================================================================================================
See accompanying notes to financial statements. 79 Statement of CHANGES in NET ASSETS (continued) (Unaudited)
PENNSYLVANIA DIVIDEND PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) ADVANTAGE 2 (NVY) --------------------------- ---------------------------- SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 1,628,205 $ 3,248,492 $ 1,843,811 $ 3,696,558 Net realized gain (loss) from: Investments 153,952 20,306 (95,877) 74,310 Forward swaps -- -- -- -- Futures -- -- 66,461 -- Change in net unrealized appreciation (depreciation) of: Investments (8,247,548) (2,827,071) (7,824,725) (3,075,387) Forward swaps -- -- -- -- Futures -- -- (87,082) -- Distributions to Preferred Shareholders: From net investment income (479,030) (849,664) (550,933) (970,796) From accumulated net realized gains -- (54,170) -- (61,834) ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from operations (6,944,421) (462,107) (6,648,345) (337,149) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (1,149,742) (2,342,752) (1,292,856) (2,635,991) From accumulated net realized gains -- (171,961) -- (181,447) ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (1,149,742) (2,514,713) (1,292,856) (2,817,438) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions -- 28,147 -- 9,543 Repurchased -- -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions -- 28,147 -- 9,543 ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (8,094,163) (2,948,673) (7,941,201) (3,145,044) Net assets applicable to Common shares at the beginning of period 48,211,431 51,160,104 53,996,736 57,141,780 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $40,117,268 $48,211,431 $46,055,535 $53,996,736 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of period $ (45,264) $ (44,697) $ (24,126) $ (24,148) ====================================================================================================================================
See accompanying notes to financial statements. 80 Notes to FINANCIAL STATEMENTS (Unaudited) 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The state funds covered in this report and their corresponding Common share stock exchange symbols are Nuveen New Jersey Investment Quality Municipal Fund, Inc. (NQJ), Nuveen New Jersey Premium Income Municipal Fund, Inc. (NNJ), Nuveen New Jersey Dividend Advantage Municipal Fund (NXJ), Nuveen New Jersey Dividend Advantage Municipal Fund 2 (NUJ), Nuveen Pennsylvania Investment Quality Municipal Fund (NQP), Nuveen Pennsylvania Premium Income Municipal Fund 2 (NPY), Nuveen Pennsylvania Dividend Advantage Municipal Fund (NXM) and Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (NVY) (collectively, the "Funds"). Common shares of New Jersey Investment Quality (NQJ), New Jersey Premium Income (NNJ), Pennsylvania Investment Quality (NQP) and Pennsylvania Premium Income 2 (NPY) are traded on the New York Stock Exchange while Common shares of New Jersey Dividend Advantage (NXJ), New Jersey Dividend Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and Pennsylvania Dividend Advantage 2 (NVY) 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. 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 or certain U.S. territories. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with U.S. generally accepted accounting principles. Investment Valuation The prices of municipal bonds in each Fund's investment portfolio are provided by a pricing service approved by the Fund's Board of Directors/Trustees. When market price quotes are not readily available (which is usually the case for municipal securities), the pricing service may establish fair 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, evaluations of anticipated cash flows or collateral and general market conditions. Prices of forward swap contracts are also provided by an independent pricing service approved by each Fund's Board of Directors/Trustees. Futures contracts are valued using the closing settlement price, or, in the absence of such a price, at the mean of the bid and asked prices. If the pricing service is unable to supply a price for an investment or derivative instrument, each Fund may use market quotes provided by major broker/dealers in such investments. If it is determined that the market price for an investment or derivative instrument is unavailable or inappropriate, the Board of Directors/Trustees of the Funds, or its designee, may establish fair value in accordance with procedures established in good faith by the Board of Directors/Trustees. Temporary investments in securities that have variable rate and demand features qualifying them as short-term investments are valued at amortized cost, which approximates value. Investment Transactions Investment transactions are recorded on a trade date basis. Realized gains and losses from transactions are determined on the specific identification method. Investments purchased on a when-issued/delayed delivery basis may have extended settlement periods. Any investments so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments. At October 31, 2008, there were no such outstanding purchase commitments in any of the Funds. Investment Income Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Investment income also includes paydown gains and losses, if any. 81 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) Income Taxes Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and to otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions 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. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation. Effective October 31, 2007, the Funds adopted Financial Accounting Standards Board (FASB) Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (FIN 48). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the affirmative evaluation of tax positions taken or expected to be taken in the course of preparing the Funds' tax returns to determine whether it is "more-likely-than-not" (i.e., a greater than 50-percent likelihood) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold may result in a tax expense in the current year. Implementation of FIN 48 required management of the Funds to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which includes federal and certain states. Open tax years are those that are open for examination by taxing authorities (i.e., generally the last four tax year ends and the interim tax period since then). The Funds have no examinations in progress. For all open tax years and all major taxing jurisdictions through the end of the reporting period, management of the Funds has reviewed all tax positions taken or expected to be taken in the preparation of the Funds' tax returns and concluded the adoption of FIN 48 resulted in no impact to the Funds' net assets or results of operations as of and during the six months ended October 31, 2008. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. Dividends and Distributions to Common Shareholders Dividends from tax-exempt net investment income are declared monthly. Net realized capital gains and/or market discount from investment transactions, if any, are distributed to shareholders at least annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards. Distributions to Common shareholders of tax-exempt net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. generally accepted accounting principles. 82 Preferred Shares The Funds have issued and outstanding Preferred shares, $25,000 stated value per share, as a means of effecting financial leverage. Each Fund's Preferred shares are issued in one or more Series. The dividend rate paid by the Funds on each Series is determined every seven days, pursuant to a dutch auction process overseen by the auction agent, and is payable at the end of each rate period. As of October 31, 2008, the number of Preferred shares outstanding, by Series and in total, for each Fund is as follows: NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------- Number of shares: Series M 3,200 -- -- -- Series T -- 624 1,920 -- Series W -- 1,440 -- 1,380 Series TH 2,000 1,600 -- -- Series F 1,280 -- -- -- -------------------------------------------------------------------------------- Total 6,480 3,664 1,920 1,380 ================================================================================ PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------- Number of shares: Series M -- 844 -- 1,140 Series T 880 -- 1,000 -- Series W 2,400 -- -- -- Series TH 2,000 2,080 -- -- Series F -- 1,800 -- -- -------------------------------------------------------------------------------- Total 5,280 4,724 1,000 1,140 ================================================================================ Beginning in February 2008, more shares for sale were submitted in the regularly scheduled auctions for the Preferred shares issued by the Funds than there were offers to buy. This meant that these auctions "failed to clear," and that many Preferred shareholders who wanted to sell their shares in these auctions were unable to do so. Preferred shareholders unable to sell their shares received distributions at the "maximum rate" applicable to failed auctions as calculated in accordance with the pre-established terms of the Preferred shares. These developments generally do not affect the management or investment policies of the Funds. However, one implication of these auction failures for Common shareholders is that the Funds' cost of leverage will likely be higher, at least temporarily, than it otherwise would have been had the auctions continued to be successful. As a result, the Funds' future Common share earnings may be lower than they otherwise would have been. On June 11, 2008, Nuveen Investments, Inc. ("Nuveen") announced the Fund Board's approval of plans to use tender option bonds (TOBs), also known as "floaters" or floating rate obligations, to refinance a portion of the municipal funds' outstanding Preferred shares, whose auctions have been failing for several months. The plan included an initial phase of approximately $1 billion in forty-one funds. The Funds did not redeem any of their Preferred shares during the six months ended October 31, 2008. Inverse Floating Rate Securities Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. In turn, this trust (a) issues floating rate certificates, in face amounts equal to some fraction of the deposited bond's par amount or market value, that typically pay short-term tax-exempt interest rates to third parties, and (b) issues to a long-term investor (such as one of the Funds) an inverse floating rate certificate (sometimes referred to as an "inverse floater") that represents all remaining or residual interest in the trust. The income received by the inverse floater holder varies inversely with the short-term rate paid to the floating rate certificates' holders, and in most circumstances the inverse floater holder bears substantially all of the underlying bond's downside investment risk and also benefits disproportionately from any potential appreciation of the underlying bond's value. The price of an inverse floating rate security will be more volatile than that of the underlying bond because the interest rate is dependent on not only the fixed coupon rate of the underlying bond but also on the short-term interest paid on the floating rate certificates, and because the inverse floating rate security essentially bears the risk of loss of the greater face value of the underlying bond. 83 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) A Fund may purchase an inverse floating rate security in a secondary market transaction without first owning the underlying bond (referred to as an "externally-deposited inverse floater"), or instead by first selling a fixed-rate bond to a broker-dealer for deposit into the special purpose trust and receiving in turn the residual interest in the trust (referred to as a "self-deposited inverse floater"). The inverse floater held by a Fund gives the Fund the right (a) to cause the holders of the floating rate certificates to tender their notes at par, and (b) to have the broker transfer the fixed-rate bond held by the trust to the Fund, thereby collapsing the trust. An investment in an externally-deposited inverse floater is identified in the Portfolio of Investments as an "Inverse floating rate investment". An investment in a self-deposited inverse floater is accounted for as a financing transaction in accordance with Statement of Financial Accounting Standards No. 140 (SFAS No. 140) "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities". In such instances, a fixed-rate bond deposited into a special purpose trust is identified in the Portfolio of Investments as an "Underlying bond of an inverse floating rate trust", with the Fund accounting for the short-term floating rate certificates issued by the trust as "Floating rate obligations" on the Statement of Assets and Liabilities. In addition, the Fund reflects in Investment Income the entire earnings of the underlying bond and the related interest paid to the holders of the short-term floating rate certificates is included as "Interest expense on floating rate obligations" on the Statement of Operations. Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a "recourse trust" or "credit recovery swap") (such agreements referred to herein as "Recourse Trusts") with a broker-dealer by which a Fund agrees to reimburse the broker-dealer, in certain circumstances, for the difference between the liquidation value of the fixed-rate bond held by the trust and the liquidation value of the floating rate certificates issued by the trust plus any shortfalls in interest cash flows. Under these agreements, a Fund's potential exposure to losses related to or on inverse floaters may increase beyond the value of a Fund's inverse floater investments as a Fund may potentially be liable to fulfill all amounts owed to holders of the floating rate certificates. At period end, any such shortfall is included as "Unrealized depreciation on Recourse Trusts" on the Statement of Assets and Liabilities. During the six months ended October 31, 2008, New Jersey Investment Quality (NQJ), New Jersey Premium Income (NNJ), New Jersey Dividend Advantage (NXJ), Pennsylvania Investment Quality (NQP) and Pennsylvania Premium Income 2 (NPY) invested in externally deposited inverse floaters and/or self-deposited inverse floaters. New Jersey Dividend Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and Pennsylvania Dividend Advantage 2 (NVY) did not invest in any such instruments during the six months ended October 31, 2008. At October 31, 2008, the Funds were not invested in any externally-deposited Recourse Trusts. NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------- Maximum exposure $ -- $ -- $ -- $ -- ================================================================================ PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------- Maximum exposure $ -- $ -- $ -- $ -- ================================================================================ 84 The average floating rate obligations outstanding and average annual interest rate and fees related to self-deposited inverse floaters during the six months ended October 31, 2008, were as follows: PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM QUALITY INCOME 2 (NQP) (NPY) -------------------------------------------------------------------------------- Average floating rate obligations $21,652,391 $6,220,272 Average annual interest rate and fees 2.63% 2.69% ================================================================================ Forward Swap Transactions Each Fund is authorized to invest in forward interest rate swap transactions. Each Fund's use of forward interest rate swap transactions is intended to help the Fund manage its overall interest rate sensitivity, either shorter or longer, generally to more closely align the Fund's interest rate sensitivity with that of the broader municipal market. Forward interest rate swap transactions involve each Fund's agreement with a counterparty to pay, in the future, a fixed or variable rate payment in exchange for the counterparty paying the Fund a variable or fixed rate payment, the accruals for which would begin at a specified date in the future (the "effective date"). The amount of the payment obligation is based on the notional amount of the forward swap contract and the termination date of the swap (which is akin to a bond's maturity). The value of the Fund's swap commitment would increase or decrease based primarily on the extent to which long-term interest rates for bonds having a maturity of the swap's termination date increases or decreases. The Funds may terminate a swap contract prior to the effective date, at which point a realized gain or loss is recognized. When a forward swap is terminated, it ordinarily does not involve the delivery of securities or other underlying assets or principal, but rather is settled in cash on a net basis. Each Fund intends, but is not obligated, to terminate its forward swaps before the effective date. Accordingly, the risk of loss with respect to the swap counterparty on such transactions is limited to the credit risk associated with a counterparty failing to honor its commitment to pay any realized gain to the Fund upon termination. To reduce such credit risk, all counterparties are required to pledge collateral daily (based on the daily valuation of each swap) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when any of the Funds have an unrealized loss on a swap contract, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the swap valuations fluctuate, either up or down, by at least the predetermined threshold amount. None of the Funds invested in forward interest rate swap transactions during the six months ended October 31, 2008. Futures Contracts Each Fund is authorized to invest in futures contracts. Upon entering into a futures contract, a Fund is required to deposit with the broker an amount of cash or liquid securities equal to a specified percentage of the contract amount. This is known as the "initial margin." Subsequent payments ("variation margin") are made or received by a Fund each day, depending on the daily fluctuation of the value of the contract. During the period the futures contract is open, changes in the value of the contract are recognized as an unrealized gain or loss by "marking-to-market" on a daily basis to reflect the changes in market value of the contract. When the contract is closed or expired, a Fund records a realized gain or loss equal to the difference between the value of the contract on the closing date and value of the contract when originally entered into. Cash held by the broker to cover initial margin requirements on open futures contracts, if any, is recognized on the Statement of Assets and Liabilities. Additionally, the Statement of Assets and Liabilities reflects a receivable or payable for the variation margin, when applicable. New Jersey Premium Income (NNJ) and Pennsylvania Dividend Advantage 2 (NVY) invested in futures contracts during the six months ended October 31, 2008. Risks of investments in futures contracts include the possible adverse movement of the securities or indices underlying the contracts, the possibility that there may not be a liquid secondary market for the contracts and/or that a change in the value of the contract may not correlate with a change in the value of the underlying securities or indices. Zero Coupon Securities Each Fund is authorized to invest in zero coupon securities. A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Tax-exempt income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. Such securities are included in the Portfolios of Investments with a 0.000% coupon rate in their description. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically. 85 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) Custodian Fee Credit Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by net credits earned on each Fund's cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Credits for cash balances may be offset by charges for any days on which a Fund overdraws its account at the custodian bank. Indemnifications Under the Funds' organizational documents, their Officers and Directors/Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Funds enter into contracts that provide general indemnifications to other parties. The Funds' maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets applicable to Common shares from operations during the reporting period. Actual results may differ from those estimates. 2. FAIR VALUE MEASUREMENTS During the current fiscal period, the Funds adopted the provisions of Statement of Financial Accounting Standards No. 157 (SFAS No. 157) "Fair Value Measurements." SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. In determining the value of each Fund's investments various inputs are used. These inputs are summarized in the three broad levels listed below: Level 1 - Quoted prices in active markets for identical securities. Level 2 - Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). Level 3 - Significant unobservable inputs (including management's assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of each Fund's fair value measurements as of October 31, 2008:
NEW JERSEY INVESTMENT QUALITY (NQJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $391,473,060 $ -- $391,473,060 ======================================================================================================================= NEW JERSEY PREMIUM INCOME (NNJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $237,303,835 $ -- $237,303,835 Derivatives* (213,351) -- -- (213,351) ----------------------------------------------------------------------------------------------------------------------- Total $(213,351) $237,303,835 $ -- $237,090,484 ======================================================================================================================= NEW JERSEY DIVIDEND ADVANTAGE (NXJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $121,556,055 $ -- $121,556,055 ======================================================================================================================= NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $86,433,657 $ -- $86,433,657 =======================================================================================================================
* Represents net unrealized appreciation (depreciation). 86
PENNSYLVANIA INVESTMENT QUALITY (NQP) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $333,292,706 $ -- $333,292,706 ======================================================================================================================= PENNSYLVANIA PREMIUM INCOME 2 (NPY) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $284,810,627 $ -- $284,810,627 ======================================================================================================================= PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $63,451,574 $ -- $63,451,574 ======================================================================================================================= PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL ----------------------------------------------------------------------------------------------------------------------- Investments $ -- $74,117,484 $ -- $74,117,484 Derivatives* (87,082) -- -- (87,082) ----------------------------------------------------------------------------------------------------------------------- Total $(87,082) $74,117,484 $ -- $74,030,402 =======================================================================================================================
* Represents net unrealized appreciation (depreciation). 3. FUND SHARES Common Shares The Board of Directors/Trustees approved an open-market share repurchase program on July 10, 2007, for Pennsylvania Investment Quality (NQP) and Pennsylvania Premium Income 2 (NPY) and on July 31, 2008 for New Jersey Investment Quality (NQJ), New Jersey Premium Income (NNJ), New Jersey Dividend Advantage (NXJ), New Jersey Dividend Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and Pennsylvania Dividend Advantage 2 (NVY) under which each Fund may repurchase an aggregate of up to 10% of its outstanding Common shares. Transactions in Common shares were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT QUALITY (NQJ) PREMIUM INCOME (NNJ) DIVIDEND ADVANTAGE (NXJ) ------------------------ ----------------------- ------------------------ SIX MONTHS SIX MONTHS SIX MONTHS ENDED YEAR ENDED ENDED YEAR ENDED ENDED YEAR ENDED 10/31/08 4/30/08 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------ Common shares: Issued to shareholders due to reinvestment of distributions -- -- -- -- -- 2,302 Repurchased -- -- -- -- -- -- ------------------------------------------------------------------------------------------------------------------ Weighted average price per Common share repurchased -- -- -- -- -- -- Weighted average discount per Common share repurchased -- -- -- -- -- -- ================================================================================================================== NEW JERSEY PENNSYLVANIA PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NUJ) INVESTMENT QUALITY (NQP) PREMIUM INCOME 2 (NPY) ------------------------ ----------------------- ------------------------ SIX MONTHS SIX MONTHS SIX MONTHS ENDED YEAR ENDED ENDED YEAR ENDED ENDED YEAR ENDED 10/31/08 4/30/08 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------ Common shares: Issued to shareholders due to reinvestment of distributions -- 1,545 -- -- -- -- Repurchased -- -- -- (139,900) -- (156,100) ------------------------------------------------------------------------------------------------------------------ Weighted average price per Common share repurchased -- -- -- $13.23 -- $12.92 Weighted average discount per Common share repurchased -- -- -- 9.64% -- 8.93% ================================================================================================================== PENNSYLVANIA PENNSYLVANIA DIVIDEND DIVIDEND ADVANTAGE (NXM) ADVANTAGE 2 (NVY) ----------------------- ----------------------- SIX MONTHS SIX MONTHS ENDED YEAR ENDED ENDED YEAR ENDED 10/31/08 4/30/08 10/31/08 4/30/08 ------------------------------------------------------------------------------------------------------------------ Common shares: Issued to shareholders due to reinvestment of distributions -- 1,846 -- 626 Repurchased -- -- -- -- ------------------------------------------------------------------------------------------------------------------ Weighted average price per Common share repurchased -- -- -- -- Weighted average discount per Common share repurchased -- -- -- -- ==================================================================================================================
87 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) 4. INVESTMENT TRANSACTIONS Purchases and sales (including maturities but excluding short-term investments and derivative transactions) during the six months ended October 31, 2008, were as follows: NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------- Purchases $ 3,899,750 $3,114,075 $ 575,565 $ 197,894 Sales and maturities 14,148,446 4,443,224 4,156,246 1,240,380 ================================================================================ PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------- Purchases $12,630,271 $17,981,782 $2,603,507 $3,067,058 Sales and maturities 19,553,397 24,127,616 3,799,002 2,075,670 ================================================================================ 5. INCOME TAX INFORMATION The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate transactions subject to SFAS No.140. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset values of the Funds. At October 31, 2008, the cost of investments was as follows: NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------- Cost of investments $432,718,329 $255,999,509 $136,345,802 $96,398,190 ================================================================================ PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------- Cost of investments $340,975,953 $317,092,453 $70,622,392 $80,754,640 ================================================================================ 88 Gross unrealized appreciation and gross unrealized depreciation of investments at October 31, 2008, were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) --------------------------------------------------------------------------------------------- Gross unrealized: Appreciation $ 4,051,968 $ 4,277,304 $ 1,028,664 $ 783,406 Depreciation (45,297,237) (22,972,978) (15,818,411) (10,747,939) --------------------------------------------------------------------------------------------- Net unrealized appreciation (depreciation) of investments $(41,245,269) $(18,695,674) $(14,789,747) $ (9,964,533) ============================================================================================= PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) --------------------------------------------------------------------------------------------- Gross unrealized: Appreciation $ 6,168,420 $ 4,406,333 $ 720,660 $ 1,304,111 Depreciation (35,156,165) (36,688,159) (7,891,478) (7,941,267) --------------------------------------------------------------------------------------------- Net unrealized appreciation (depreciation) of investments $(28,987,745) $(32,281,826) $(7,170,818) $(6,637,156) =============================================================================================
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains at April 30, 2008, the Funds' last tax year end, were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------------------------- Undistributed net tax-exempt income * $ 864,838 $450,899 $ 71,016 $319,006 Undistributed net ordinary income ** 1,237,909 516,439 346,098 182,576 Undistributed net long-term capital gains 1,336,555 885,534 144,716 265,912 ================================================================================================== PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------------------------- Undistributed net tax-exempt income * $626,146 $610,618 $109,462 $167,649 Undistributed net ordinary income ** -- 37,787 -- -- Undistributed net long-term capital gains -- -- -- 20,215 ==================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared on April 1, 2008, paid on May 1, 2008. ** Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. 89 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) The tax character of distributions paid during the Funds' last tax year ended April 30, 2008, was designated for purposes of the dividends paid deduction as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $18,776,382 $10,955,180 $6,276,949 $4,206,447 Distributions from net ordinary income ** -- 12,727 -- 886 Distributions from net long-term capital gains 837,918 673,257 230,127 899,123 ================================================================================================== PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $15,335,512 $13,821,804 $3,228,981 $3,634,945 Distributions from net ordinary income ** -- -- -- -- Distributions from net long-term capital gains -- 955,818 226,011 243,281 ==================================================================================================
** Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. At April 30, 2008, the Funds' last tax year end, the following Funds had unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire as follows: PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM QUALITY INCOME 2 (NQP) (NPY) -------------------------------------------------------------------------------- Expiration: April 30, 2014 $124,650 $ -- April 30, 2015 170,887 -- April 30, 2016 217,013 840,338 -------------------------------------------------------------------------------- Total $512,550 $840,338 ================================================================================ The following Funds have elected to defer net realized losses from investments incurred from November 1, 2007 through April 30, 2008, the Funds' last tax year end, ("post-October losses") in accordance with federal income tax regulations. Post-October losses are treated as having arisen on the first day of the current fiscal year: PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND QUALITY INCOME 2 ADVANTAGE (NQP) (NPY) (NXM) -------------------------------------------------------------------------------- Post-October capital losses $2,297,704 $659,889 $116,226 ================================================================================ 6. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES Each Fund's management fee is separated into two components - a complex-level component, based on the aggregate amount of all fund assets managed by Nuveen Asset Management (the "Adviser"), a wholly owned subsidiary of Nuveen, and a specific fund-level component, based only on the amount of assets within each individual Fund. This pricing structure enables Nuveen 90 fund shareholders to benefit from growth in the assets within each individual fund as well as from growth in the amount of complex-wide assets managed by the Adviser. The annual fund-level fee, payable monthly, for each Fund is based upon the average daily net assets (including net assets attributable to Preferred shares) of each Fund as follows: NEW JERSEY INVESTMENT QUALITY (NQJ) NEW JERSEY PREMIUM INCOME (NNJ) AVERAGE DAILY NET ASSETS PENNSYLVANIA INVESTMENT QUALITY (NQP) (INCLUDING NET ASSETS PENNSYLVANIA PREMIUM INCOME 2 (NPY) ATTRIBUTABLE TO PREFERRED SHARES) FUND-LEVEL FEE RATE -------------------------------------------------------------------------------- For the first $125 million .4500% For the next $125 million .4375 For the next $250 million .4250 For the next $500 million .4125 For the next $1 billion .4000 For the next $3 billion .3875 For net assets over $5 billion .3750 ================================================================================ NEW JERSEY DIVIDEND ADVANTAGE (NXJ) NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) AVERAGE DAILY NET ASSETS PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) (INCLUDING NET ASSETS PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) ATTRIBUTABLE TO PREFERRED SHARES) FUND-LEVEL FEE RATE -------------------------------------------------------------------------------- For the first $125 million .4500% For the next $125 million .4375 For the next $250 million .4250 For the next $500 million .4125 For the next $1 billion .4000 For net assets over $2 billion .3750 ================================================================================ The annual complex-level fee, payable monthly, which is additive to the fund-level fee, for all Nuveen sponsored funds in the U.S., is based on the aggregate amount of total fund assets managed as stated in the following table. As of October 31, 2008, the complex-level fee rate was .1998%. The complex-level fee schedule is as follows: COMPLEX-LEVEL ASSET BREAKPOINT LEVEL (1) EFFECTIVE RATE AT BREAKPOINT LEVEL -------------------------------------------------------------------------------- $55 billion .2000% $56 billion .1996 $57 billion .1989 $60 billion .1961 $63 billion .1931 $66 billion .1900 $71 billion .1851 $76 billion .1806 $80 billion .1773 $91 billion .1691 $125 billion .1599 $200 billion .1505 $250 billion .1469 $300 billion .1445 ================================================================================ (1) The complex-level fee component of the management fee for the funds is calculated based upon the aggregate daily net assets of all Nuveen funds, with such daily net assets to include assets attributable to preferred stock issued by or borrowings by such funds but to exclude assets attributable to investments in other Nuveen funds. 91 Notes to FINANCIAL STATEMENTS (continued) (Unaudited) The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Funds pay no compensation directly to those of its Directors/Trustees who are affiliated with the Adviser or to its Officers, all of whom receive remuneration for their services to the Funds from the Adviser or its affiliates. The Board of Directors/Trustees has adopted a deferred compensation plan for independent Directors/Trustees that enables Directors/Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen advised funds. For the first ten years of New Jersey Dividend Advantage's (NXJ) and Pennsylvania Dividend Advantage's (NXM) 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 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 New Jersey Dividend Advantage (NXJ) and Pennsylvania Dividend Advantage (NXM) for any portion of their fees and expenses beyond March 31, 2011. For the first ten years of New Jersey Dividend Advantage 2's (NUJ) and Pennsylvania Dividend Advantage 2's (NVY) 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 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 New Jersey Dividend Advantage 2 (NUJ) and Pennsylvania Dividend Advantage 2 (NVY) for any portion of their fees and expenses beyond March 31, 2012. 92 7. NEW ACCOUNTING PRONOUNCEMENT Financial Accounting Standards Board Statement of Financial Accounting Standards No. 161 (SFAS No. 161) In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities." This standard is intended to enhance financial statement disclosures for derivative instruments and hedging activities and enable investors to understand: a) how and why a fund uses derivative instruments, b) how derivative instruments and related hedge items are accounted for, and c) how derivative instruments and related hedge items affect a fund's financial position, results of operations and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. As of October 31, 2008, management does not believe the adoption of SFAS No. 161 will impact the financial statement amounts; however, additional footnote disclosures may be required about the use of derivative instruments and hedging items. 8. SUBSEQUENT EVENTS Distributions to Common Shareholders The Funds declared Common share dividend distributions from their tax-exempt net investment income which were paid on December 1, 2008, to shareholders of record on November 15, 2008, as follows: NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME ADVANTAGE ADVANTAGE 2 (NQJ) (NNJ) (NXJ) (NUJ) -------------------------------------------------------------------------------- Dividend per share $.0545 $.0515 $.0550 $.0575 ================================================================================ PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA INVESTMENT PREMIUM DIVIDEND DIVIDEND QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2 (NQP) (NPY) (NXM) (NVY) -------------------------------------------------------------------------------- Dividend per share $.0570 $.0520 $.0585 $.0585 ================================================================================ 93 Financial HIGHLIGHTS (Unaudited) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ---------------------------------------------------------------- ------------------------------ Distributions Distributions from Net from Net Beginning Investment Capital Investment Capital Common Net Income to Gains to Income to Gains to Share Net Realized/ Preferred Preferred Common Common Net Asset Investment Unrealized Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total =============================================================================================================================== NEW JERSEY INVESTMENT QUALITY (NQJ) ------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $14.26 $ .46 $(2.05) $(.15) $ -- $(1.74) $(.33) $ -- $ (.33) 2008 14.96 .92 (.67) (.26) (.01) (.02) (.65) (.03) (.68) 2007(c) 14.53 .75 .47 (.20) (.01) 1.01 (.55) (.03) (.58) Year Ended 6/30: 2006 15.61 .91 (.75) (.18) (.03) (.05) (.79) (.24) (1.03) 2005 14.69 .95 1.13 (.10) (.01) 1.97 (.94) (.11) (1.05) 2004 15.65 1.01 (.75) (.05) (.01) .20 (.96) (.20) (1.16) 2003 15.07 1.05 .61 (.07) (.01) 1.58 (.93) (.07) (1.00) NEW JERSEY PREMIUM INCOME (NNJ) ------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) 14.64 .44 (1.82) (.15) -- (1.53) (.32) -- (.32) 2008 15.23 .90 (.53) (.25) (.01) .11 (.66) (.04) (.70) 2007(c) 14.79 .74 .49 (.20) --*** 1.03 (.58) (.01) (.59) Year Ended 6/30: 2006 16.05 .90 (.85) (.17) (.04) (.16) (.79) (.31) (1.10) 2005 15.35 .94 1.01 (.10) (.01) 1.84 (.92) (.22) (1.14) 2004 16.28 .99 (.79) (.05) (.01) .14 (.94) (.13) (1.07) 2003 15.60 1.04 .63 (.07) -- 1.60 (.92) -- (.92) =============================================================================================================================== Total Returns -------------------- Offering Based Costs and Ending on Preferred Common Based Common Share Share Ending on Share Net Underwriting Net Asset Market Market Asset Discounts Value Value Value* Value* ============================================================================= NEW JERSEY INVESTMENT QUALITY (NQJ) ----------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $ -- $12.19 $10.31 (19.07)% (12.43)% 2008 -- 14.26 13.09 (3.64) (.08) 2007(c) -- 14.96 14.30 8.75 7.05 Year Ended 6/30: 2006 -- 14.53 13.70 (3.62) (.31) 2005 -- 15.61 15.25 15.13 13.81 2004 -- 14.69 14.19 (4.09) 1.26 2003 -- 15.65 15.94 11.68 10.72 NEW JERSEY PREMIUM INCOME (NNJ) ----------------------------------------------------------------------------- Year Ended 4/30: 2009(b) -- 12.79 10.86 (17.31) (10.59) 2008 -- 14.64 13.48 (6.18) .77 2007(c) -- 15.23 15.12 11.10 7.03 Year Ended 6/30: 2006 -- 14.79 14.16 (3.36) (1.04) 2005 -- 16.05 15.76 19.43 12.31 2004 -- 15.35 14.19 (5.65) .85 2003 -- 16.28 16.10 10.18 10.48 ============================================================================= Ratios/Supplemental Data ---------------------------------------------------------------------------------------------------------------- Ratios to Average Net Assets Ratios to Average Net Assets Applicable to Common Shares Applicable to Common Shares Before Credit/Reimbursement After Credit/Reimbursement** ------------------------------------------ ----------------------------------------- Ending Net Assets Applicable Expenses Expenses Net Expenses Expenses Net Portfolio to Common Including Excluding Investment Including Excluding Investment Turnover Shares (000) Interest++(a) Interest++(a) Income++ Interest++(a) Interest++(a) Income++ Rate ==================================================================================================================================== NEW JERSEY INVESTMENT QUALITY (NQJ) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) $249,796 1.25%**** 1.25%**** 6.60%**** 1.23%**** 1.23%**** 6.62%**** 1% 2008 292,194 1.23 1.23 6.30 1.21 1.21 6.31 17 2007(c) 306,402 1.20**** 1.20**** 6.04**** 1.19**** 1.19**** 6.06**** 7 Year Ended 6/30: 2006 297,539 1.21 1.21 6.05 1.19 1.19 6.08 17 2005 319,083 1.21 1.21 6.22 1.20 1.20 6.23 15 2004 299,671 1.21 1.21 6.64 1.21 1.21 6.64 19 2003 316,970 1.22 1.22 6.80 1.22 1.22 6.81 12 NEW JERSEY PREMIUM INCOME (NNJ) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) 154,101 1.24**** 1.24**** 6.19**** 1.22**** 1.22**** 6.21**** 1 2008 176,374 1.24 1.24 6.04 1.23 1.23 6.04 19 2007(c) 183,540 1.21**** 1.21**** 5.83**** 1.20**** 1.20**** 5.84**** 6 Year Ended 6/30: 2006 178,199 1.19 1.19 5.81 1.18 1.18 5.83 12 2005 193,182 1.18 1.18 5.91 1.17 1.17 5.92 21 2004 184,753 1.18 1.18 6.23 1.18 1.18 6.23 23 2003 195,568 1.20 1.20 6.48 1.20 1.20 6.48 13 ====================================================================================================================================
Preferred Shares at End of Period -------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share ==================================================== NEW JERSEY INVESTMENT QUALITY (NQJ) ---------------------------------------------------- Year Ended 4/30: 2009(b) $162,000 $25,000 $63,549 2008 162,000 25,000 70,092 2007(c) 162,000 25,000 72,284 Year Ended 6/30: 2006 162,000 25,000 70,917 2005 162,000 25,000 74,241 2004 162,000 25,000 71,246 2003 162,000 25,000 73,915 NEW JERSEY PREMIUM INCOME (NNJ) ---------------------------------------------------- Year Ended 4/30: 2009(b) 91,600 25,000 67,058 2008 91,600 25,000 73,137 2007(c) 91,600 25,000 75,093 Year Ended 6/30: 2006 91,600 25,000 73,635 2005 91,600 25,000 77,724 2004 91,600 25,000 75,424 2003 91,600 25,000 78,376 ==================================================== * Total Return Based on Market Value is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized. Total Return Based on Common Share Net Asset Value is the combination of changes in Common share net asset value, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending net asset value. The actual reinvest price for the last dividend declared in the period may often be based on the Fund's market price (and not its net asset value), and therefore may be different from the price used in the calculation. Total returns are not annualized. ** After custodian fee credit and expense reimbursement, where applicable. *** Rounds to less than $.01 per share. **** Annualized. + The amounts shown are based on Common share equivalents. ++ Ratios do not reflect the effect of dividend payments to Preferred shareholders; income ratios reflect income earned on assets attributable to Preferred shares. (a) Interest expense arises from the application of SFAS No. 140 to certain inverse floating rate transactions entered into by the Fund as more fully described in Footnote 1 - Inverse Floating Rate Securities. (b) For the six months ended October 31, 2008. (c) For the ten months ended April 30, 2007. See accompanying notes to financial statements. 94-95 spread Financial HIGHLIGHTS (continued) (Unaudited) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ---------------------------------------------------------------- ------------------------------ Distributions Distributions from Net from Net Beginning Investment Capital Investment Capital Common Net Income to Gains to Income to Gains to Share Net Realized/ Preferred Preferred Common Common Net Asset Investment Unrealized Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total =============================================================================================================================== NEW JERSEY DIVIDEND ADVANTAGE (NXJ) ------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $14.26 $ .46 $(2.23) $(.14) $ -- $(1.91) $(.33) $ -- $(.33) 2008 15.09 .94 (.80) (.25) (.01) (.12) (.68) (.03) (.71) 2007(c) 14.68 .78 .47 (.19) --*** 1.06 (.64) (.01) (.65) Year Ended 6/30: 2006 15.63 .95 (.77) (.18) (.01) (.01) (.84) (.10) (.94) 2005 14.59 .98 1.09 (.10) -- 1.97 (.93) -- (.93) 2004 15.35 1.00 (.77) (.05) -- .18 (.94) -- (.94) 2003 14.38 1.04 .86 (.07) -- 1.83 (.87) -- (.87) NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) ------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) 14.35 .48 (2.27) (.15) -- (1.94) (.35) -- (.35) 2008 15.31 .97 (.79) (.23) (.05) (.10) (.71) (.15) (.86) 2007(c) 14.87 .83 .47 (.20) --*** 1.10 (.66) --*** (.66) Year Ended 6/30: 2006 15.79 .99 (.76) (.19) (.01) .03 (.86) (.09) (.95) 2005 14.62 1.00 1.25 (.11) -- 2.14 (.92) (.05) (.97) 2004 15.44 1.03 (.82) (.06) -- .15 (.92) (.05) (.97) 2003 14.46 1.05 .96 (.08) -- 1.93 (.92) (.03) (.95) =============================================================================================================================== Total Returns -------------------- Offering Based Costs and Ending on Preferred Common Based Common Share Share Ending on Share Net Underwriting Net Asset Market Market Asset Discounts Value Value Value* Value* =========================================================================== NEW JERSEY DIVIDEND ADVANTAGE (NXJ) --------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $ -- $12.02 $10.23 (19.78)% (13.62)% 2008 -- 14.26 13.11 (12.31) (.81) 2007(c) -- 15.09 15.75 14.37 7.26 Year Ended 6/30: 2006 -- 14.68 14.35 (.78) (.05) 2005 -- 15.63 15.38 19.97 13.80 2004 -- 14.59 13.63 (5.13) 1.20 2003 .01 15.35 15.30 15.09 13.18 NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) --------------------------------------------------------------------------- Year Ended 4/30: 2009(b) -- 12.06 10.80 (18.32) (13.79) 2008 -- 14.35 13.59 (12.41) (.60) 2007(c) -- 15.31 16.50 15.40 7.50 Year Ended 6/30: 2006 -- 14.87 14.90 (.49) .25 2005 -- 15.79 15.90 23.39 15.00 2004 -- 14.62 13.74 (4.81) 1.02 2003 -- 15.44 15.40 9.14 13.74 =========================================================================== Ratios/Supplemental Data ----------------------------------------------------------------------------------------------------------------- Ratios to Average Net Assets Ratios to Average Net Assets Applicable to Common Shares Applicable to Common Shares Before Credit/Reimbursement After Credit/Reimbursement** ------------------------------------------ ----------------------------------------- Ending Net Assets Applicable Expenses Expenses Net Expenses Expenses Net Portfolio to Common Including Excluding Investment Including Excluding Investment Turnover Shares (000) Interest++(a) Interest++(a) Income++ Interest++(a) Interest++(a) Income++ Rate ==================================================================================================================================== NEW JERSEY DIVIDEND ADVANTAGE (NXJ) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) $79,085 1.24%**** 1.24**** 6.37%**** 1.00%**** 1.00%**** 6.61%**** --% 2008 93,762 1.20 1.20 6.10 .89 .89 6.41 17 2007(c) 99,203 1.20**** 1.20**** 5.85**** .83**** .83**** 6.23**** 9 Year Ended 6/30: 2006 96,378 1.19 1.19 5.83 .75 .75 6.28 16 2005 102,502 1.19 1.19 5.94 .74 .74 6.39 17 2004 95,651 1.20 1.20 6.26 .74 .74 6.71 11 2003 100,502 1.19 1.19 6.56 .74 .74 7.01 8 NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) 54,539 1.29**** 1.29**** 6.53**** .96**** .96**** 6.87**** -- 2008 64,904 1.25 1.25 6.16 .85 .85 6.56 16 2007(c) 69,238 1.24**** 1.24**** 6.03**** .78**** .78**** 6.49**** 11 Year Ended 6/30: 2006 67,150 1.23 1.23 5.99 .76 .76 6.47 13 2005 71,231 1.23 1.23 6.09 .77 .77 6.54 11 2004 65,919 1.25 1.25 6.41 .79 .79 6.87 11 2003 69,616 1.23 1.23 6.53 .76 .76 7.00 12 ====================================================================================================================================
Preferred Shares at End of Period -------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share ==================================================== NEW JERSEY DIVIDEND ADVANTAGE (NXJ) ---------------------------------------------------- Year Ended 4/30: 2009(b) $48,000 $25,000 $66,190 2008 48,000 25,000 73,834 2007(c) 48,000 25,000 76,668 Year Ended 6/30: 2006 48,000 25,000 75,197 2005 48,000 25,000 78,386 2004 48,000 25,000 74,818 2003 48,000 25,000 77,345 NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ) ---------------------------------------------------- Year Ended 4/30: 2009(b) 34,500 25,000 64,521 2008 34,500 25,000 72,032 2007(c) 34,500 25,000 75,172 Year Ended 6/30: 2006 34,500 25,000 73,659 2005 34,500 25,000 76,617 2004 34,500 25,000 72,767 2003 34,500 25,000 75,446 ==================================================== * Total Return Based on Market Value is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized. Total Return Based on Common Share Net Asset Value is the combination of changes in Common share net asset value, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending net asset value. The actual reinvest price for the last dividend declared in the period may often be based on the Fund's market price (and not its net asset value), and therefore may be different from the price used in the calculation. Total returns are not annualized. ** After custodian fee credit and expense reimbursement, where applicable. *** Rounds to less than $.01 per share. **** Annualized. + The amounts shown are based on Common share equivalents. ++ Ratios do not reflect the effect of dividend payments to Preferred shareholders; income ratios reflect income earned on assets attributable to Preferred shares. (a) Interest expense arises from the application of SFAS No. 140 to certain inverse floating rate transactions entered into by the Fund as more fully described in Footnote 1 - Inverse Floating Rate Securities. (b) For the six months ended October 31, 2008. (c) For the ten months ended April 30, 2007. See accompanying notes to financial statements. 96-97 spread Financial HIGHLIGHTS (continued) (Unaudited) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ---------------------------------------------------------------- ------------------------------ Distributions Distributions from Net from Net Beginning Investment Capital Investment Capital Common Net Income to Gains to Income to Gains to Share Net Realized/ Preferred Preferred Common Common Net Asset Investment Unrealized Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total ============================================================================================================================== PENNSYLVANIA INVESTMENT QUALITY (NQP) ------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) $14.39 $ .48 $(2.25) $(.16) $ -- $(1.93) $(.33) $ -- $ (.33) 2008 15.19 .95 (.80) (.29) -- (.14) (.66) -- (.66) 2007(c) 14.71 .77 .47 (.23) -- 1.01 (.53) -- (.53) Year Ended 6/30: 2006 15.73 .90 (.87) (.21) (.02) (.20) (.71) (.11) (.82) 2005 14.92 .92 1.05 (.12) (.01) 1.84 (.89) (.14) (1.03) 2004 15.91 .98 (.98) (.06) -- (.06) (.92) (.01) (.93) 2003 14.70 1.02 1.19 (.09) -- 2.12 (.91) -- (.91) PENNSYLVANIA PREMIUM INCOME 2 (NPY) ------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) 13.74 .46 (2.37) (.15) -- (2.06) (.30) -- (.30) 2008 14.70 .90 (.93) (.26) (.02) (.31) (.61) (.04) (.65) 2007(c) 14.22 .74 .50 (.21) -- 1.03 (.55) -- (.55) Year Ended 6/30: 2006 15.32 .89 (.80) (.18) (.03) (.12) (.77) (.21) (.98) 2005 14.74 .92 .88 (.10) (.01) 1.69 (.93) (.18) (1.11) 2004 15.65 .98 (.77) (.05) (.01) .15 (.95) (.11) (1.06) 2003 14.83 1.04 .79 (.08) -- 1.75 (.93) -- (.93) ============================================================================================================================== Total Returns -------------------- Offering Based Costs and Ending on Preferred Common Based Common Share Share Ending on Share Net Underwriting Net Asset Market Market Asset Discounts Value Value Value* Value* ========================================================================== PENNSYLVANIA INVESTMENT QUALITY (NQP) -------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $ -- $12.13 $10.29 (19.21)% (13.60) 2008 -- 14.39 13.10 (1.78) (.92) 2007(c) -- 15.19 14.01 12.41 6.89 Year Ended 6/30: 2006 -- 14.71 12.95 (9.47) (1.34) 2005 -- 15.73 15.16 19.53 12.67 2004 -- 14.92 13.58 (9.73) (.38) 2003 -- 15.91 16.01 11.98 14.79 PENNSYLVANIA PREMIUM INCOME 2 (NPY) -------------------------------------------------------------------------- Year Ended 4/30: 2009(b) -- 11.38 9.35 (21.86) (15.21) 2008 -- 13.74 12.30 (5.26) (2.06) 2007(c) -- 14.70 13.67 9.83 7.31 Year Ended 6/30: 2006 -- 14.22 12.96 (8.42) (.80)*** 2005 -- 15.32 15.16 17.79 11.80 2004 -- 14.74 13.84 (7.22) .94 2003 -- 15.65 16.00 15.09 12.09 ========================================================================== Ratios/Supplemental Data ----------------------------------------------------------------------------------------------------------------- Ratios to Average Net Assets Ratios to Average Net Assets Applicable to Common Shares Applicable to Common Shares Before Credit/Reimbursement After Credit/Reimbursement** ------------------------------------------ ----------------------------------------- Ending Net Assets Applicable Expenses Expenses Net Expenses Expenses Net Portfolio to Common Including Excluding Investment Including Excluding Investment Turnover Shares (000) Interest++(a) Interest++(a) Income++ Interest++(a) Interest++(a) Income++ Rate =================================================================================================================================== PENNSYLVANIA INVESTMENT QUALITY (NQP) ----------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $196,081 1.55%**** 1.29%**** 6.93%**** 1.54%**** 1.28%**** 6.94%**** 3% 2008 232,528 1.65 1.27 6.48 1.64 1.26 6.49 20 2007(c) 247,644 1.54**** 1.25**** 6.06**** 1.53**** 1.23**** 6.07**** 16 Year Ended 6/30: 2006 239,718 1.23 1.23 5.87 1.21 1.21 5.89 20 2005 256,365 1.23 1.23 5.96 1.22 1.22 5.97 18 2004 243,287 1.23 1.23 6.38 1.22 1.22 6.39 17 2003 258,924 1.27 1.27 6.59 1.26 1.26 6.60 11 PENNSYLVANIA PREMIUM INCOME 2 (NPY) ----------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) 178,257 1.35**** 1.27**** 6.96**** 1.33**** 1.24**** 6.98**** 6 2008 215,252 1.55 1.28 6.36 1.53 1.27 6.37 27 2007(c) 232,650 1.40**** 1.21**** 6.08**** 1.39**** 1.20**** 6.09**** 15 Year Ended 6/30: 2006 225,121 1.20 1.20 6.01 1.18 1.18 6.03 18 2005 242,373 1.19 1.19 6.09 1.19 1.19 6.10 22 2004 232,455 1.18 1.18 6.45 1.17 1.17 6.46 16 2003 246,604 1.20 1.20 6.76 1.19 1.19 6.77 19 ===================================================================================================================================
Preferred Shares at End of Period -------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share ==================================================== PENNSYLVANIA INVESTMENT QUALITY (NQP) ---------------------------------------------------- Year Ended 4/30: 2009(b) $132,000 $25,000 $62,137 2008 132,000 25,000 69,039 2007(c) 132,000 25,000 71,902 Year Ended 6/30: 2006 132,000 25,000 70,401 2005 132,000 25,000 73,554 2004 132,000 25,000 71,077 2003 132,000 25,000 74,039 PENNSYLVANIA PREMIUM INCOME 2 (NPY) ---------------------------------------------------- Year Ended 4/30: 2009(b) 118,100 25,000 62,734 2008 118,100 25,000 70,566 2007(c) 118,100 25,000 74,249 Year Ended 6/30: 2006 118,100 25,000 72,655 2005 118,100 25,000 76,307 2004 118,100 25,000 74,207 2003 118,100 25,000 77,202 ==================================================== * Total Return Based on Market Value is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized. Total Return Based on Common Share Net Asset Value is the combination of changes in Common share net asset value, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending net asset value. The actual reinvest price for the last dividend declared in the period may often be based on the Fund's market price (and not its net asset value), and therefore may be different from the price used in the calculation. Total returns are not annualized. ** After custodian fee credit and expense reimbursement, where applicable. *** During the fiscal year ended June 30, 2006, Pennsylvania Premium Income 2 (NPY) received a payment from the Adviser of $27,169, to offset losses realized on the disposal of investments purchased in violation of the Fund's investment restrictions. This reimbursement did not have an impact on the Fund's Total Return on Common Share Net Asset Value. **** Annualized. + 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) Interest expense arises from the application of SFAS No. 140 to certain inverse floating rate transactions entered into by the Fund as more fully described in Footnote 1 - Inverse Floating Rate Securities. (b) For the six months ended October 31, 2008. (c) For the ten months ended April 30, 2007. See accompanying notes to financial statements. 98-99 spread Financial HIGHLIGHTS (continued) (Unaudited) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ---------------------------------------------------------------- ------------------------------ Distributions Distributions from Net from Net Beginning Investment Capital Investment Capital Common Net Income to Gains to Income to Gains to Share Net Realized/ Preferred Preferred Common Common Net Asset Investment Unrealized Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total ============================================================================================================================== PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) ------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) $14.47 $ .49 $(2.43) $(.14) $ -- $(2.08) $(.35) $ -- $ (.35) 2008 15.36 .97 (.84) (.25) (.02) (.14) (.70) (.05) (.75) 2007(c) 14.95 .82 .46 (.21) -- 1.07 (.66) -- (.66) Year Ended 6/30: 2006 15.93 .98 (.78) (.19) (.01) -- (.88) (.10) (.98) 2005 15.32 .99 1.06 (.10) (.02) 1.93 (.96) (.36) (1.32) 2004 16.25 1.04 (.78) (.05) (.01) .20 (.96) (.17) (1.13) 2003 14.96 1.08 1.29 (.07) (.01) 2.29 (.92) (.10) (1.02) PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) ------------------------------------------------------------------------------------------------------------------------------ Year Ended 4/30: 2009(b) 14.49 .49 (2.12) (.15) -- (1.78) (.35) -- (.35) 2008 15.34 .99 (.80) (.26) (.02) (.09) (.71) (.05) (.76) 2007(c) 14.93 .83 .44 (.21) (.01) 1.05 (.62) (.02) (.64) Year Ended 6/30: 2006 15.89 .98 (.85) (.19) (.01) (.07) (.79) (.10) (.89) 2005 14.87 .97 1.08 (.11) -- 1.94 (.88) (.04) (.92) 2004 15.90 .98 (.87) (.05) (.01) .05 (.92) (.16) (1.08) 2003 14.64 1.00 1.30 (.09) -- 2.21 (.92) (.03) (.95) ============================================================================================================================== Total Returns -------------------- Offering Based Costs and Ending on Preferred Common Based Common Share Share Ending on Share Net Underwriting Net Asset Market Market Asset Discounts Value Value Value* Value* ========================================================================== PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) -------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $ -- $12.04 $10.76 (18.70)% (14.66)% 2008 -- 14.47 13.61 (8.46) (.87) 2007(c) -- 15.36 15.70 8.40 7.22 Year Ended 6/30: 2006 -- 14.95 15.10 (.56) (.01) 2005 -- 15.93 16.14 21.84 13.02 2004 -- 15.32 14.39 (5.95) 1.30 2003 .02 16.25 16.46 18.13 15.95 PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) -------------------------------------------------------------------------- Year Ended 4/30: 2009(b) -- 12.36 10.33 (20.67) (12.52) 2008 -- 14.49 13.40 (6.81) (.60) 2007(c) -- 15.34 15.18 11.88 7.14 Year Ended 6/30: 2006 -- 14.93 14.16 .88 (.46) 2005 -- 15.89 14.90 17.63 13.37 2004 -- 14.87 13.48 (8.58) .29 2003 -- 15.90 15.84 14.38 15.48 ========================================================================== Ratios/Supplemental Data ----------------------------------------------------------------------------------------------------------------- Ratios to Average Net Assets Ratios to Average Net Assets Applicable to Common Shares Applicable to Common Shares Before Credit/Reimbursement After Credit/Reimbursement** ------------------------------------------ ----------------------------------------- Ending Net Assets Applicable Expenses Expenses Net Expenses Expenses Net Portfolio to Common Including Excluding Investment Including Excluding Investment Turnover Shares (000) Interest++(a) Interest++(a) Income++ Interest++(a) Interest++(a) Income++ Rate =================================================================================================================================== PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) ----------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) $40,117 1.33%*** 1.33%*** 6.73%*** 1.08%*** 1.08%*** 6.98%*** 4% 2008 48,211 1.39 1.28 6.26 1.07 .96 6.57 20 2007(c) 51,160 1.33*** 1.27*** 5.99*** .95*** .89*** 6.37*** 11 Year Ended 6/30: 2006 49,660 1.25 1.25 5.90 .80 .80 6.35 12 2005 52,712 1.23 1.23 5.82 .78 .78 6.28 13 2004 50,549 1.21 1.21 6.15 .76 .76 6.60 10 2003 53,591 1.23 1.23 6.44 .79 .79 6.88 13 PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) ----------------------------------------------------------------------------------------------------------------------------------- Year Ended 4/30: 2009(b) 46,056 1.34*** 1.34*** 6.72*** 1.03*** 1.03*** 7.03*** 3 2008 53,997 1.40 1.29 6.29 1.01 .90 6.67 27 2007(c) 57,142 1.33*** 1.27*** 6.03*** .88*** .82*** 6.48*** 13 Year Ended 6/30: 2006 55,597 1.24 1.24 5.93 .77 .77 6.40 13 2005 59,174 1.23 1.23 5.80 .78 .78 6.25 8 2004 55,370 1.24 1.24 5.95 .78 .78 6.40 4 2003 59,202 1.25 1.25 6.07 .78 .78 6.53 13 ===================================================================================================================================
Preferred Shares at End of Period -------------------------------------- Aggregate Liquidation Amount and Market Asset Outstanding Value Coverage (000) Per Share Per Share ==================================================== PENNSYLVANIA DIVIDEND ADVANTAGE (NXM) ---------------------------------------------------- Year Ended 4/30: 2009(b) $25,000 $25,000 $65,117 2008 25,000 25,000 73,211 2007(c) 25,000 25,000 76,160 Year Ended 6/30: 2006 25,000 25,000 74,660 2005 25,000 25,000 77,712 2004 25,000 25,000 75,549 2003 25,000 25,000 78,591 PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY) ---------------------------------------------------- Year Ended 4/30: 2009(b) 28,500 25,000 65,400 2008 28,500 25,000 72,366 2007(c) 28,500 25,000 75,124 Year Ended 6/30: 2006 28,500 25,000 73,769 2005 28,500 25,000 76,907 2004 28,500 25,000 73,570 2003 28,500 25,000 76,932 ==================================================== * Total Return Based on Market Value is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized. Total Return Based on Common Share Net Asset Value is the combination of changes in Common share net asset value, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending net asset value. The actual reinvest price for the last dividend declared in the period may often be based on the Fund's market price (and not its net asset value), and therefore may be different from the price used in the calculation. Total returns are not annualized. ** After custodian fee credit and expense reimbursement, where applicable. *** Annualized. + 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) Interest expense arises from the application of SFAS No. 140 to certain inverse floating rate transactions entered into by the Fund as more fully described in Footnote 1 - Inverse Floating Rate Securities. (b) For the six months ended October 31, 2008. (c) For the ten months ended April 30, 2007. See accompanying notes to financial statements. 100-101 spread Annual Investment Management Agreement APPROVAL PROCESS The Investment Company Act of 1940, as amended (the "1940 Act"), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund's board members, including by a vote of a majority of the board members who are not parties to the advisory agreement or "interested persons" of any parties (the "Independent Board Members"), cast in person at a meeting called for the purpose of considering such approval. In connection with such approvals, the fund's board members must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the advisory agreement. Accordingly, at a meeting held on May 28-29, 2008 (the "May Meeting"), the Boards of Trustees or Directors (as the case may be)(each, a "Board" and each Trustee or Director, a "Board Member") of the Funds, including a majority of the Independent Board Members, considered and approved the continuation of the advisory agreement (each, an "Advisory Agreement") between each Fund and Nuveen Asset Management ("NAM") for an additional one-year period. In preparation for their considerations at the May Meeting, the Board also held a separate meeting on April 23, 2008 (the "April Meeting"). Accordingly, the factors considered and determinations made regarding the renewals by the Independent Board Members include those made at the April Meeting. In addition, in evaluating the Advisory Agreements, as described in further detail below, the Independent Board Members reviewed a broad range of information relating to the Funds and NAM, including absolute performance, fee and expense information for the Funds as well as comparative performance, fee and expense information for a comparable peer group of funds, the performance information of recognized benchmarks (as applicable), the profitability of Nuveen for its advisory activities (which includes its wholly owned subsidiaries), and other information regarding the organization, personnel, and services provided by NAM. The Independent Board Members also met quarterly as well as at other times as the need arose during the year and took into account the information provided at such meetings and the knowledge gained therefrom. Prior to approving the renewal of the Advisory Agreements, the Independent Board Members reviewed the foregoing information with their independent legal counsel and with management, reviewed materials from independent legal counsel describing applicable law and their duties in reviewing advisory contracts, and met with independent legal counsel in private sessions without management present. The Independent Board Members considered the legal advice provided by independent legal counsel and relied upon their knowledge of NAM, its services and the Funds resulting from their meetings and other interactions throughout the year and their own business judgment in determining the factors to be considered in evaluating the Advisory Agreements. Each Board Member may have accorded different weight to the various factors in reaching his or her conclusions with respect to a Fund's Advisory Agreement. The Independent Board Members did not identify any single factor as all-important or controlling. The Independent Board Members' considerations were instead based on a comprehensive consideration of all the information presented. The principal factors considered by the Board and its conclusions are described below. 102 A. NATURE, EXTENT AND QUALITY OF SERVICES In considering renewal of the Advisory Agreements, the Independent Board Members considered the nature, extent and quality of NAM's services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, NAM's organization and business; the types of services that NAM or its affiliates provide and are expected to provide to the Funds; the performance record of the applicable Fund (as described in further detail below); and any initiatives Nuveen had taken for the applicable fund product line. With respect to personnel, the Independent Board Members evaluated the background, experience and track record of NAM's investment personnel. In this regard, the Independent Board Members considered the additional investment in personnel to support Nuveen fund advisory activities, including in operations, product management and marketing as well as related fund support functions, including sales, executive, finance, human resources and information technology. The Independent Board Members also reviewed information regarding portfolio manager compensation arrangements to evaluate NAM's ability to attract and retain high quality investment personnel. In evaluating the services of NAM, the Independent Board Members also considered NAM's ability to supervise the Funds' other service providers and given the importance of compliance, NAM's compliance program. Among other things, the Independent Board Members considered the report of the chief compliance officer regarding the Funds' compliance policies and procedures. In addition to advisory services, the Independent Board Members considered the quality of administrative services provided by NAM and its affiliates including product management, fund administration, oversight of service providers, shareholder services, administration of Board relations, regulatory and portfolio compliance and legal support. In addition to the foregoing services, the Independent Board Members also noted the additional services that NAM or its affiliates provide to closed-end funds, including, in particular, its secondary market support activities and the costs of such activities. The Independent Board Members recognized Nuveen's continued commitment to supporting the secondary market for the common shares of its closed-end funds through a variety of programs designed to raise investor and analyst awareness and understanding of closed-end funds. These efforts include maintaining an investor relations program to timely provide information and education to financial advisers and investors; providing advertising and marketing for the closed-end funds; maintaining its closed-end fund website; and providing educational seminars. With respect to closed-end funds that utilize leverage through the issuance of auction rate preferred securities ("ARPS"), the Board has recognized the unprecedented market conditions in the auction rate market industry with the failure of the auction process. The Independent Board Members noted Nuveen's efforts and the resources and personnel employed to analyze the situation, explore potential alternatives and develop and implement solutions that serve the interests of the affected funds and all of their respective shareholders. The Independent Board Members further noted Nuveen's commitment and efforts to keep investors and financial advisers informed as to its progress in addressing the ARPS situation through, among other things, conference calls, press releases, and information posted on its website as well as its refinancing activities. The Independent Board Members also noted Nuveen's continued support for holders of preferred shares of its closed-end funds by, among other things, seeking distribution for preferred shares with new market participants, managing relations with remarketing agents and the broker community, maintaining the leverage and risk management of leverage and maintaining systems necessary to test compliance with rating agency criteria. Based on their review, the Independent Board Members found that, overall, the nature, extent and quality of services provided (and expected to be provided) to the respective Funds under the Advisory Agreements were satisfactory. 103 ANNUAL INVESTMENT MANAGEMENT AGREEMENT APPROVAL PROCESS (continued) B. THE INVESTMENT PERFORMANCE OF THE FUNDS AND NAM The Board considered the investment performance of each Fund, including the Fund's historic performance as well as its performance compared to funds with similar investment objectives (the "Performance Peer Group") based on data provided by an independent third party (as described below). The Independent Board Members also reviewed portfolio level performance (which does not reflect fund level fees, expenses and leverage), as described in further detail below. In evaluating the performance information, the Board considered whether the Fund has operated within its investment objectives and parameters and the impact that the investment mandates may have had on performance. In addition, in comparing a Fund's performance with that of its Performance Peer Group, the Independent Board Members took into account that the closest Performance Peer Group in certain instances may not adequately reflect the respective fund's investment objectives and strategies thereby hindering a meaningful comparison of the fund's performance with that of the Performance Peer Group. The Independent Board Members also recognized that certain funds lack comparable peers in which case their performance is measured against a more general municipal category for various states. The closed-end municipal funds that do not have corresponding state-specific Performance Peer Groups are from states other than New York, California, Florida, New Jersey, Michigan, and Pennsylvania. The Independent Board Members reviewed performance information including, among other things, total return information compared with the Fund's Performance Peer Group and recognized benchmarks for the one-, three-, and five-year periods (as applicable) ending December 31, 2007 and with the Performance Peer Group for the quarter and same yearly periods ending March 31, 2008 (as applicable). The Independent Board Members also reviewed the Fund's portfolio level performance (which does not reflect fund level fees and expenses (and leverage for closed-end funds)) compared to recognized benchmarks for the one-, three-, and five-year periods ending December 31, 2007 (as applicable). The analysis was used to assess the efficacy of investment decisions against appropriate measures of risk and total return, within specific market segments. This information supplemented the Fund performance information provided to the Board at each of its quarterly meetings. Based on their review, the Independent Board Members determined that each Fund's investment performance over time had been satisfactory. C. FEES, EXPENSES AND PROFITABILITY 1. FEES AND EXPENSES The Board evaluated the management fees and expenses of each Fund reviewing, among other things, such Fund's gross management fees (which take into account breakpoints), net management fees (which take into account fee waivers or reimbursements) and total expense ratios (before and after expense reimbursements and/or waivers) in absolute terms as well as compared to the gross management fees, net management fees (after waivers and/or reimbursements) and total expense ratios (before and after waivers) of a comparable universe of unaffiliated funds based on data provided by an independent data provider (the "Peer Universe") and/or a more focused subset of funds therein (the "Peer Group"). The Independent Board Members further reviewed data regarding the construction of Peer Groups as well as the methods of measurement for the fee and expense analysis and the performance analysis. In reviewing the comparisons of fee and expense information, the Independent Board Members took into account that in certain instances various factors such as the size of the Fund relative to peers, the size and particular composition of the Peer Group, the investment objectives of the peers, expense anomalies, and the timing of information used may impact the comparative data, thereby limiting the ability to make a meaningful comparison. The Independent Board Members also considered, among other things, the differences in the use of leverage and the differences in the use of insurance as well as the states reflected in a respective Peer Group for the state municipal funds (such as the use of a 104 general "other states" category for closed-end state funds (other than New York and California)). In reviewing the fee schedule for a Fund, the Independent Board Members also considered the fund-level and complex-wide breakpoint schedules (described in further detail below) and any fee waivers and reimbursements provided by Nuveen (applicable, in particular, for certain closed-end funds launched since 1999). Based on their review of the fee and expense information provided, the Independent Board Members determined that each Fund's management fees and net total expense ratio were reasonable in light of the nature, extent and quality of services provided to the Fund. 2. COMPARISONS WITH THE FEES OF OTHER CLIENTS The Independent Board Members further reviewed information regarding the nature of services and fee rates offered by NAM to other clients. Such other clients include NAM's municipal separately managed accounts. In evaluating the comparisons of fees, the Independent Board Members noted that the fee rates charged to the Funds and other clients vary, among other things, because of the different services involved and the additional regulatory and compliance requirements associated with registered investment companies, such as the Funds. Accordingly, the Independent Board Members considered the differences in the product types, including, but not limited to, the services provided, the structure and operations, product distribution and costs thereof, portfolio investment policies, investor profiles, account sizes and regulatory requirements. The Independent Board Members noted, in particular, that the range of services provided to the Funds (as discussed above) is much more extensive than that provided to separately managed accounts. Given the inherent differences in the products, particularly the extensive services provided to the Funds, the Independent Board Members believe such facts justify the different levels of fees. 3. PROFITABILITY OF NUVEEN In conjunction with its review of fees, the Independent Board Members also considered the profitability of Nuveen for its advisory activities (which incorporated Nuveen's wholly-owned affiliated sub-advisers) and its financial condition. The Independent Board Members reviewed the revenues and expenses of Nuveen's advisory activities for the last two years and the allocation methodology used in preparing the profitability data. The Independent Board Members noted this information supplemented the profitability information requested and received during the year to help keep them apprised of developments affecting profitability (such as changes in fee waivers and expense reimbursement commitments). In this regard, the Independent Board Members noted that they had also appointed an Independent Board Member as a point person to review and keep them apprised of changes to the profitability analysis and/or methodologies during the year. The Independent Board Members considered Nuveen's profitability compared with other fund sponsors prepared by two independent third party service providers as well as comparisons of the revenues, expenses and profit margins of various unaffiliated management firms with similar amounts of assets under management prepared by Nuveen. In reviewing profitability, the Independent Board Members recognized the subjective nature of determining profitability which may be affected by numerous factors including the allocation of expenses. Further, the Independent Board Members recognized the difficulties in making comparisons as the profitability of other advisers generally is not publicly available and the profitability information that is available for certain advisers or management firms may not be representative of the industry and may be affected by, among other things, the adviser's particular business mix, capital costs, types of funds managed and expense allocations. Notwithstanding the foregoing, the Independent Board Members reviewed Nuveen's methodology and assumptions for allocating expenses across product lines to determine profitability. In reviewing profitability, the Independent Board Members recognized Nuveen's investment in its fund business. Based on its review, the Independent Board Members concluded that Nuveen's level of profitability for its advisory activities was reasonable in light of the services provided. 105 ANNUAL INVESTMENT MANAGEMENT AGREEMENT APPROVAL PROCESS (continued) In evaluating the reasonableness of the compensation, the Independent Board Members also considered other amounts paid to NAM by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) NAM and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Funds, if any. See Section E below for additional information on indirect benefits NAM may receive as a result of its relationship with the Funds. Based on their review of the overall fee arrangements of each Fund, the Independent Board Members determined that the advisory fees and expenses of the respective Fund were reasonable. D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE With respect to economies of scale, the Independent Board Members recognized the potential benefits resulting from the costs of a fund being spread over a larger asset base. The Independent Board Members therefore considered whether the Funds have appropriately benefited from any economies of scale and whether there is potential realization of any further economies of scale. In considering economies of scale, the Independent Board Members have recognized that economies of scale are difficult to measure and predict with precision, particularly on a fund-by-fund basis. Notwithstanding the foregoing, one method to help ensure the shareholders share in these benefits is to include breakpoints in the advisory fee schedule. Accordingly, the Independent Board Members reviewed and considered the fund-level breakpoints in the advisory fee schedules that reduce advisory fees. In this regard, given that the Funds are closed-end funds, the Independent Board Members recognized that although the Funds may from time to time make additional share offerings, the growth in their assets will occur primarily through appreciation of each Fund's investment portfolio. In addition to fund-level advisory fee breakpoints, the Board also considered the Funds' complex-wide fee arrangement. Pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex, including the Funds, are reduced as the assets in the fund complex reach certain levels. In evaluating the complex-wide fee arrangement, the Independent Board Members recognized that the complex-wide fee schedule was recently revised in 2007 to provide for additional fee savings to shareholders and considered the amended schedule. The Independent Board Members further considered that the complex-wide fee arrangement seeks to provide the benefits of economies of scale to fund shareholders when total fund complex assets increase, even if assets of a particular fund are unchanged or have decreased. The approach reflects the notion that some of Nuveen's costs are attributable to services provided to all its funds in the complex and therefore all funds benefit if these costs are spread over a larger asset base. Based on their review, the Independent Board Members concluded that the breakpoint schedule and complex-wide fee arrangement were acceptable and desirable in providing benefits from economies of scale to shareholders. E. INDIRECT BENEFITS In evaluating fees, the Independent Board Members received and considered information regarding potential "fall out" or ancillary benefits NAM or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered revenues received by affiliates of NAM for serving as agent at Nuveen's preferred trading desk and for serving as a co-manager in the initial public offering of new closed-end exchange traded funds. 106 In addition to the above, the Independent Board Members considered whether NAM received any benefits from soft dollar arrangements whereby a portion of the commissions paid by a Fund for brokerage may be used to acquire research that may be useful to NAM in managing the assets of the Funds and other clients. The Independent Board Members noted that NAM does not currently have any soft dollar arrangements; however, to the extent certain bona fide agency transactions that occur on markets that traditionally trade on a principal basis and riskless principal transactions are considered as generating "commissions," NAM intends to comply with the applicable safe harbor provisions. Based on their review, the Independent Board Members concluded that any indirect benefits received by NAM as a result of its relationship with the Funds were reasonable and within acceptable parameters. F. OTHER CONSIDERATIONS The Independent Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, unanimously concluded that the terms of the Advisory Agreements are fair and reasonable, that NAM's fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed. 107 Reinvest Automatically EASILY and CONVENIENTLY NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR REINVESTMENT ACCOUNT. NUVEEN CLOSED-END FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Closed-End Fund allows you to conveniently reinvest dividends and/or capital gains distributions in additional Fund shares. By choosing to reinvest, you'll be able to invest money regularly and automatically, and watch your investment grow through the power of tax-free compounding. Just like dividends or distributions in cash, there may be times when income or capital gains taxes may be payable on dividends or distributions that are reinvested. It is important to note that an automatic reinvestment plan does not ensure a profit, nor does it protect you against loss in a declining market. EASY AND CONVENIENT To make recordkeeping easy and convenient, each month you'll receive a statement showing your total dividends and distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own. HOW SHARES ARE PURCHASED The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above net asset value at the time of valuation, the Fund will issue new shares at the greater of the net asset value or 95% of the then-current market price. If the shares are trading at less than net asset value, shares for your account will be purchased on the open market. If the Plan Agent begins purchasing Fund shares on the open market while shares are trading below net asset value, but the Fund's shares subsequently trade at or above their net asset value before the Plan Agent is able to complete its purchases, the Plan Agent may cease open-market purchases and may invest the uninvested portion of the distribution in newly-issued Fund shares at a price equal to the greater of the shares' net asset value or 95% of the shares' market value on the last business day immediately prior to the purchase date. Dividends and distributions received to purchase shares in the open market will normally be invested shortly after the dividend payment date. No interest will be paid on dividends and distributions awaiting reinvestment. Because the market price of the shares may increase before purchases are completed, the average purchase price 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. 108 FLEXIBLE You may change your distribution option or withdraw from the Plan at any time, should your needs or situation change. Should you withdraw, you can receive a certificate for all whole shares credited to your reinvestment account and cash payment for fractional shares, or cash payment for all reinvestment account shares, less brokerage commissions and a $2.50 service fee. You can reinvest whether your shares are registered in your name, or in the name of a brokerage firm, bank, or other nominee. Ask your investment advisor if his or her firm will participate on your behalf. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time. CALL TODAY TO START REINVESTING DIVIDENDS AND/OR DISTRIBUTIONS For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial advisor or call us at (800) 257-8787. 109 Glossary of TERMS USED in this REPORT [] AUCTION RATE BOND: An auction rate bond is a security whose interest payments are adjusted periodically through an auction process, which process typically also serves as a means for buying and selling the bond. Auctions that fail to attract enough buyers for all the shares offered for sale are deemed to have "failed", with current holders receiving a formula-based interest rate until the next scheduled auction. [] AVERAGE ANNUAL TOTAL RETURN: This is a commonly used method to express an investment's performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment's actual cumulative performance (including change in NAV or market price and reinvested dividends and capital gains distributions, if any) over the time period being considered. [] AVERAGE EFFECTIVE MATURITY: The average of the number of years to maturity of the bonds in a Fund's portfolio, computed by weighting each bond's time to maturity (the date the security comes due) by the market value of the security. This figure does not account for the likelihood of prepayments or the exercise of call provisions unless an escrow account has been established to redeem the bond before maturity. The market value weighting for an investment in an inverse floating rate security is the value of the portfolio's residual interest in the inverse floating rate trust, and does not include the value of the floating rate securities issued by the trust. [] INVERSE FLOATERS: Inverse floating rate securities are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond's par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an "inverse floater") to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates' holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond's downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond's value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis. [] LEVERAGE-ADJUSTED DURATION: Duration is a measure of the expected period over which a bond's principal and interest will be paid, and consequently is a measure of the sensitivity of a bond's or bond Fund's value to changes when market interest rates change. Generally, the longer a bond's or Fund's duration, the more the price of the bond or Fund will change as interest rates change. Leverage-adjusted duration takes into account the leveraging process for a Fund and therefore is longer than the duration of the Fund's portfolio of bonds. [] 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 per common share is calculated by subtracting the liabilities of the Fund (including any Preferred shares issued in order to leverage the Fund) from its total assets and then dividing the remainder by the number of common shares outstanding. Fund NAVs are calculated at the end of each business day. [] 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. [] ZERO COUPON BOND: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Tax-exempt income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically. 110 Other Useful INFORMATION QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION You may obtain (i) each Fund's quarterly portfolio of investments, (ii) information regarding how the Funds voted proxies relating to portfolio securities held during the twelve-month period ended June 30, 2008, and (iii) a description of the policies and procedures that the Funds used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen Investments toll-free at (800) 257-8787 or on Nuveen's website at www.nuveen.com. You may also obtain this and other Fund information directly from the Securities and Exchange Commission ("SEC"). The SEC may charge a copying fee for this information. Visit the SEC on-line at http://www.sec.gov or in person at the SEC's Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090 for room hours and operation. You may also request Fund information by sending an e-mail request to publicinfo@sec.gov or by writing to the SEC's Public References Section at 100 F Street NE, Washington, D.C. 20549. CEO CERTIFICATION DISCLOSURE Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange (NYSE) the annual CEO certification as required by Section 303A.12(a) of the NYSE Listed Company Manual. Each Fund has filed with the Securities and Exchange Commission the certification of its Chief Executive Officer and Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act. BOARD OF DIRECTORS/TRUSTEES John P. Amboian Robert P. Bremner Jack B. Evans William C. Hunter David J. Kundert William J. Schneider Judith M. Stockdale Carole E. Stone Terence J. Toth FUND MANAGER Nuveen Asset Management 333 West Wacker Drive Chicago, IL 60606 CUSTODIAN State Street Bank & Trust Company Boston, MA TRANSFER AGENT AND SHAREHOLDER SERVICES State Street Bank & Trust Company Nuveen Funds P.O. Box 43071 Providence, RI 02940-3071 (800) 257-8787 LEGAL COUNSEL Chapman and Cutler LLP Chicago, IL INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Ernst & Young LLP Chicago, IL Each Fund intends to repurchase and/or redeem 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 or redeemed during the period covered by this report. Any future repurchases and/or redemptions will be reported to shareholders in the next annual or semi-annual report. 111 Nuveen Investments: ------------------- 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. We offer many different investing solutions for our clients' different needs. Nuveen Investments is a global investment management firm that seeks to help secure the long-term goals of institutions and high net worth investors as well as the consultants and financial advisors who serve them. Nuveen Investments markets its growing range of specialized investment solutions under the high-quality brands of HydePark, NWQ, Nuveen, Rittenhouse, Santa Barbara, Symphony and Tradewinds. In total, the Company managed $134 billion of assets on September 30, 2008. Find out how we can help you reach your financial goals. To learn more about the products and services Nuveen Investments offers, talk to your financial advisor, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Be sure to obtain a prospectus, where applicable. Investors should consider the investment objective and policies, risk considerations, charges and expenses of the Fund carefully before investing. The prospectus contains this and other information relevant to an investment in the Fund. For a prospectus, please contact your securities representative or Nuveen Investments, 333 W. Wacker Dr., Chicago, IL 60606. Please read the prospectus carefully before you invest or send money. Learn more about Nuveen Funds at: www.nuveen.com/etf Share prices Fund details Daily financial news Investor education Interactive planning tools ESA-B-1008D ITEM 2. CODE OF ETHICS. Not applicable to this filing. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable to this filing. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable to this filing. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable to this filing. ITEM 6. SCHEDULE OF INVESTMENTS. See Portfolio of Investments in Item 1. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable to this filing. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable to this filing. ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Period* (a) (b) (c) (d)* TOTAL NUMBER OF AVERAGE TOTAL NUMBER OF SHARES MAXIMUM NUMBER (OR SHARES (OR PRICE (OR UNITS) PURCHASED AS APPROXIMATE DOLLAR VALUE) OF UNITS) PAID PER PART OF PUBLICLY SHARES (OR UNITS) THAT MAY YET PURCHASED SHARE (OR ANNOUNCED PLANS OR BE PURCHASED UNDER THE PLANS OR UNIT) PROGRAMS PROGRAMS AUGUST 7-31, 2008 0 $0 0 450,000 SEPTEMBER 1-30, 2008 0 $0 0 450,000 OCTOBER 1-31, 2008 0 $0 0 450,000 TOTAL 0
* The registrant's repurchase program, which authorized the repurchase of 450,000 shares, was announced August 7, 2008. Any repurchases made by the registrant pursuant to the program were made through open-market transactions. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant's Board implemented after the registrant last provided disclosure in response to this Item. ITEM 11. CONTROLS AND PROCEDURES. (a) The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")(17 CFR 240.13a-15(b) or 240.15d-15(b)). (b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. File the exhibits listed below as part of this Form. (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 to this filing. (a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: See Ex-99.CERT attached hereto. (a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons: Not applicable. (b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR 270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished pursuant to this paragraph will not be deemed "filed" for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference: See 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 New Jersey Dividend Advantage Municipal Fund 2 ----------------------------------------------------------- By (Signature and Title) /s/ Kevin J. McCarthy ---------------------------------------------- Kevin J. McCarthy (Vice President and Secretary) Date: January 9, 2009 ------------------------------------------------------------------- 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: January 9, 2009 ------------------------------------------------------------------- By (Signature and Title) /s/ Stephen D. Foy ---------------------------------------------- Stephen D. Foy Vice President and Controller (principal financial officer) Date: January 9, 2009 -------------------------------------------------------------------