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 811-10525
---------------------
Nuveen North Carolina 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)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
-------------------
Date of fiscal year end: May 31
------------------
Date of reporting period: November 30, 2006
------------------
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.
SEMIANNUAL REPORT November 30, 2006
Nuveen Investments
Municipal Closed-End Funds
NUVEEN GEORGIA
PREMIUM INCOME
MUNICIPAL FUND
NPG
NUVEEN GEORGIA
DIVIDEND ADVANTAGE
MUNICIPAL FUND
NZX
NUVEEN GEORGIA
DIVIDEND ADVANTAGE
MUNICIPAL FUND 2
NKG
NUVEEN NORTH
CAROLINA PREMIUM
INCOME MUNICIPAL FUND
NNC
NUVEEN NORTH
CAROLINA DIVIDEND
ADVANTAGE MUNICIPAL
FUND
NRB
NUVEEN NORTH
CAROLINA DIVIDEND
ADVANTAGE MUNICIPAL
FUND 2
NNO
NUVEEN NORTH
CAROLINA DIVIDEND
ADVANTAGE MUNICIPAL
FUND 3
NII
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DEPENDABLE,
TAX-FREE INCOME BECAUSE
IT'S NOT WHAT YOU EARN,
IT'S WHAT YOU KEEP.(R)
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Photo of: Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
Chairman's
LETTER TO SHAREHOLDERS
Once again, I am pleased to report that over the six-month period covered
by this report your Fund continued to provide you with attractive monthly
tax-free income. For more details about the management strategy and
performance of your Fund, please read the Portfolio Manager's Comments, the
Dividend and Share Price Information, and the Performance Overview sections
of this report.
For some time, I've used these letters to remind you that municipal bonds
can be an important building block in a well balanced investment portfolio.
In addition to providing attractive tax-free monthly income, a municipal
bond investment like your Fund may help you achieve and benefit from
greater portfolio diversification. Portfolio diversification is a
recognized way to try to reduce some of the risk that comes with investing.
For more information about this important investment strategy, I encourage
you to contact your personal financial advisor.
"IN ADDITION TO PROVIDING ATTRACTIVE TAX-FREE MONTHLY
INCOME, A MUNICIPAL BOND INVESTMENT LIKE YOUR
FUND MAY HELP YOU ACHIEVE AND BENEFIT FROM GREATER
PORTFOLIO DIVERSIFICATION."
We also are pleased to be able to offer you a choice concerning how you
receive your shareholder reports and other Fund information. As an
alternative to mailed copies, you can sign up to receive future Fund
reports and other Fund information by e-mail and the Internet. The inside
front cover of this report contains information on how you can sign up.
We are grateful that you have chosen us as a partner as you pursue your
financial goals, and we look forward to continuing to earn your trust in
the months and years ahead. At Nuveen Investments, our mission continues to
be to assist you and your financial advisor by offering investment services
and products that can help you to secure your financial objectives.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
January 15, 2007
Nuveen Investments Georgia and North Carolina Municipal Closed-End Funds
(NPG, NZX, NKG, NNC, NRB, NNO, NII)
Portfolio Manager's
COMMENTS
Portfolio manager Cathryn Steeves discusses key investment strategies and the
six month performance of these seven Funds. Cathryn, who joined Nuveen in 1996,
has managed the Funds since 2004.
WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THIS REPORTING
PERIOD?
As the yield curve flattened during this six-month period, we continued to
emphasize careful management of the Funds' underlying portfolios in line with
our established targets. This included a disciplined approach to duration1
management and yield curve positioning. In selecting new additions for our
portfolios, our purchase activity focused mainly on attractively priced bonds in
the longer range of the yield curve. We believed that bonds in this part of the
curve generally offered better value and reward opportunities more commensurate
with their risk levels. To help us maintain the Funds' durations within our
preferred strategic range, we were also selectively selling holdings with
shorter durations.
In the four North Carolina Funds, we purchased inverse floating rate trusts,
which had the benefit of both increasing the funds' distributable income and
bringing duration closer to our preferred strategic range.
At the same time, we continued to maintain the Funds' weightings of
lower-quality bonds. However, since these types of bonds performed well over
this period, we generally found fewer attractive credit opportunities in the
market place. Overall, the Funds continued to have exposure to the lower-rated
credit categories.
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.
4
HOW DID THE FUNDS PERFORM?
Individual results for these Nuveen Georgia and North Carolina Funds, as well as
relevant benchmark and peer group information, are presented in the accompanying
table.
TOTAL RETURNS ON NET ASSET VALUE*
For periods ended 11/30/06
6-MONTH 1-YEAR 5-YEAR 10-YEAR
--------------------------------------------------------------------------------
GEORGIA FUNDS
--------------------------------------------------------------------------------
NPG 5.65% 7.98% 6.79% 6.77%
--------------------------------------------------------------------------------
NZX 5.33% 7.83% 7.59% NA
--------------------------------------------------------------------------------
NKG 6.24% 8.75% NA NA
--------------------------------------------------------------------------------
NORTH CAROLINA FUNDS
--------------------------------------------------------------------------------
NNC 5.83% 7.27% 6.94% 6.73%
--------------------------------------------------------------------------------
NRB 5.59% 7.43% 7.55% NA
--------------------------------------------------------------------------------
NNO 6.10% 7.61% 7.40% NA
--------------------------------------------------------------------------------
NII 5.94% 7.53% NA NA
--------------------------------------------------------------------------------
Lehman Brothers Municipal
Bond Index2 4.53% 6.12% 5.40% 5.75%
--------------------------------------------------------------------------------
Lipper Other States Municipal
Debt Funds Average3 5.93% 7.95% 7.29% 6.59%
--------------------------------------------------------------------------------
*Six-month returns are cumulative; returns for one, five and ten-years 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.
For the six months ended November 30, 2006, the total return on NAV for all the
Funds exceeded the average return for the Lehman Brothers Municipal Bond Index.
NKG and NNO outperformed the Lipper Other States peer group, while NNC and NII
performed in line with the Lipper average. The remaining three Funds trailed
this group average. 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.
As the yield curve continued to flatten over the course of this period, bonds
with shorter maturities generally underperformed longer maturity bonds. In
general, the funds benefited from their yield curve positioning. The funds had
limited exposure to the shortest maturities, which was a positive, and generally
had an emphasis on intermediate duration bonds, which was also favorable. On the
other hand, the
2 The Lehman Brothers Municipal Bond Index is an unleveraged, unmanaged
national index comprising a broad range of investment- grade municipal
bonds. Results for the Lehman index do not reflect any expenses.
3 The Lipper Other States Municipal Debt Funds category average is calculated
using the returns of all closed-end funds in this category for each period
as follows: 1 year, 46; 5 years, 27; and 10 years, 18. Fund and Lipper
returns assume reinvestment of dividends.
5
funds had limited exposure to the very longest part of the curve, which had a
slight countervailing negative impact.
With bonds rated BBB or lower and non-rated bonds generally outperforming other
credit quality sectors during this period, all of these Funds benefited from
their allocations of lower-quality credits. The performance of this sector was
largely the result of investor demand for the higher yields typically associated
with lower-quality bonds, which drove up their value. The Funds' allocations to
BBB or lower and non-rated bonds ranged from 4% in NII, 5% in NNO, 8% in NPG,
NNC and NRB, 9% in NZX, to 11% in NKG. The North Carolina Funds' relative
underexposure to lower quality bonds negatively impacted their performance while
NKG and NZK's relative overweight positively impacted performance.
Health care sector bonds, in particular hospital bonds, were also among some of
the best performing credits in the Funds' portfolios. Our overweight in housing
bonds for the Georgia Funds negatively impacted performance as this sector
underperformed the general market.
Another factor in the annual performance of these Funds, especially relative to
that of the unleveraged Lehman Brothers Municipal Bond Index, was the use of
financial leverage. While leverage can add volatility to a Fund's NAV and share
price, this strategy can also provide opportunities for additional income and
total return for common shareholders. The Funds' leverage strategy positively
impacted their results over this period.
HOW WERE THE FUNDS POSITIONED IN TERMS OF CREDIT QUALITY AS OF
NOVEMBER 30, 2006?
As of November 30, 2006, all seven Funds continued to offer excellent overall
credit quality, with allocations of bonds rated AAA/U.S. guaranteed and AA
ranging from 82% in NPG and NNC, 84% in NRB, 85% in NZX and NNO, 87% in NKG, to
94% in NII.
6
Dividend and Share Price
INFORMATION
As previously noted, all of the Funds in this report use leverage to potentially
enhance opportunities for additional income for common shareholders. While
leveraging continued to provide incremental income over this period, the extent
of this benefit was reduced as short-term interest rates rose. The Funds' income
streams were also impacted as the proceeds from older, higher-yielding bonds
that matured or were called were reinvested into bonds generally offering lower
yields, especially in the older Funds. These factors resulted in one monthly
dividend reduction in NPG, NZX, NNC, NRB and NNO over the six-month period ended
November 30, 2006. NKG had one monthly dividend increase, while the monthly
dividend for NII was not affected.
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 November 30, 2006, NZX and
NRB had positive UNII balances for financial statement purposes and positive
UNII balances, based on our best estimates, for tax purposes. NPG, NKG, NNC, NNO
and NII had negative UNII balances for financial statement purposes and positive
UNII balances, based on our best estimates, for tax purposes.
At the end of the reporting period, the Funds' share prices were trading at
premiums or discounts to their NAVs as shown in the accompanying chart:
11/30/06 12-MONTH AVERAGE
PREMIUM/DISCOUNT PREMIUM/DISCOUNT
--------------------------------------------------------------------------------
NPG -3.99% 2.67%
--------------------------------------------------------------------------------
NZX 7.62% 7.90%
--------------------------------------------------------------------------------
NKG -6.88% -6.25%
--------------------------------------------------------------------------------
NNC -1.01% 3.29%
--------------------------------------------------------------------------------
NRB 2.55% 11.57%
--------------------------------------------------------------------------------
NNO -2.29% 2.95%
--------------------------------------------------------------------------------
NII -3.86% -0.75%
--------------------------------------------------------------------------------
7
Nuveen Georgia Premium Income Municipal Fund
NPG
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 75%
AA 7%
A 10%
BBB 7%
BB or Lower 1%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Dec 0.0625
Jan 0.0625
Feb 0.0625
Mar 0.0625
Apr 0.0625
May 0.0625
Jun 0.0585
Jul 0.0585
Aug 0.0585
Sep 0.0555
Oct 0.0555
Nov 0.0555
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 14.99
15.06
14.9
14.6
14.53
14.68
14.61
14.65
14.4
14.3
14.2
14.04
13.96
13.88
14.1
14.03
14.06
14.06
14.15
14.12
14.12
14.12
14.15
14.14
14.14
14.49
14.64
14.86
14.72
14.94
14.98
14.85
14.79
14.95
14.82
15.011
14.96
14.75
14.67
14.67
14.52
14.85
14.77
14.9
15
15.0001
15
15.24
15.24
15.069
15.2
15.15
14.96
15.2
15.2
15
15
15.07
15.3
15.3
15.39
15.4
15.32
15.62
15.3
15.3
15.4
15.35
15.35
15.33
15.45
15.48
15.48
15.4
15.8
15.6
15.35
15.25
15.21
15.4
15.8
15.75
15.75
16.08
16.25
16.55
16.55
16.7
16.45
16.17
15.85
15.71
15.45
15.25
15.16
15.2
15.1
15.08
15.18
15.18
14.96
15.25
15.4
15.4
15.45
15.58
15.55
15.45
15.65
15.81
16.1
16.07
15.4
15.4
15.42
15.4
15.41
15.29
15.45
15.33
15.15
15.09
15.09
14.97
15.14
15.16
15.22
15.25
15.15
15.03
15.03
14.95
15.03
14.76
14.56
14.53
14.55
14.33
14.1
14.36
14.43
14.5
14.4
14.1
13.96
13.89
13.87
13.995
13.99
14.2
14.3
14.2001
14.7
14.61
14.55
14.44
14.35
14.3001
14.22
14.28
14.28
14.28
14.35
14.31
14.31
14.49
14.35
14.56
14.7
15
15.02
15.35
15.1
15.09
15.3
15.28
15.34
15.45
15.45
15.47
15.47
15.45
15.45
15.51
15.46
15.46
15.51
15.46
15.58
15.58
15.95
15.98
15.94
15.68
15.46
15.57
15.52
15.6
15.5068
15.42
15.39
15.45
15.55
15.65
15.65
15.68
15.6
15.45
15.45
15.42
15.41
15.41
15.4
15.4
15.41
15.34
15.65
15.4
15.4
15.11
15.0201
15.02
14.95
14.94
14.94
14.94
14.94
14.94
14.94
14.85
14.91
14.91
15.25
15.43
15.49
15.64
15.6
15.51
15.41
15.3
15.3
15.18
15.14
15.4
15.5
15.5
15.17
14.91
14.7
14.82
14.67
14.59
14.53
14.49
11/30/06 14.42
FUND SNAPSHOT
------------------------------------
Common Share Price $14.42
------------------------------------
Common Share
Net Asset Value $15.02
------------------------------------
Premium/(Discount) to NAV -3.99%
------------------------------------
Market Yield 4.62%
------------------------------------
Taxable-Equivalent Yield1 6.84%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $57,140
------------------------------------
Average Effective Maturity
on Securities (Years) 16.73
------------------------------------
Leverage-Adjusted Duration 7.66
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 5/20/93)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) -2.69% 5.65%
------------------------------------
1-Year 2.37% 7.98%
------------------------------------
5-Year 4.46% 6.79%
------------------------------------
10-Year 6.29% 6.77%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Health Care 21.6%
------------------------------------
Tax Obligation/Limited 19.4%
------------------------------------
Education and Civic
Organizations 12.8%
------------------------------------
Water and Sewer 9.7%
------------------------------------
U.S. Guaranteed 8.6%
------------------------------------
Tax Obligation/General 6.2%
------------------------------------
Utilities 5.9%
------------------------------------
Housing/Single Family 4.5%
------------------------------------
Other 11.3%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 32.5%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
2 The Fund paid shareholders capital gains and net ordinary income
distributions in December 2005 of $0.0669 per share.
8
Nuveen Georgia Dividend Advantage Municipal Fund
NZX
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 77%
AA 8%
A 6%
BBB 7%
BB or Lower 2%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Dec 0.073
Jan 0.073
Feb 0.073
Mar 0.0695
Apr 0.0695
May 0.0695
Jun 0.066
Jul 0.066
Aug 0.066
Sep 0.0625
Oct 0.0625
Nov 0.0625
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 16.39
16.28
16.42
16.52
16.65
16.9
16.45
16.08
16.05
15.92
15.8
15.66
15.69
15.28
15.32
15.32
15.4
15.23
15.59
15.65
15.65
15.65
15.9
15.85
15.76
15.61
15.7
15.7
15.56
15.91
15.91
16.25
16.74
16.01
15.96
15.78
15.72
15.6
15.4
15.54
16
16.45
15.84
16.08
16.09
16.09
16.7
16.71
17.21
17
17
16.42
15.9
15.95
15.78
16.06
15.95
15.75
15.81
15.6
15.66
15.66
15.66
15
15.1
15.55
15.5
15.6
15.42
15.35
15.12
15.09
15.09
15.06
15.8
15.81
15.5
15.39
15.94
15.82
15.2
15.4
15.38
15.47
15.28
15.56
15.51
15.95
15.22
15.9
15.4
15.04
14.82
14.58
14.64
14.64
14.64
14.85
14.93
15
15.34
15.4
15.7
15.7
16.05
16
15.75
15.75
15.75
16.05
16.05
16.2
16.06
15.85
16
16.15
16.15
16
16
15.85
15.9
15.9
15.85
15.9
15.9
15.5
15.8
15.7
15.6999
15.68
15.38
15.38
15.9
15.71
15.562
15
15.5
15.8
15.7
15.7001
15.9
15.9
16.05
15.99
15.7
16.2
16.46
16.46
17.2
16.5
16.69
16.46
16.51
16.51
16.51
16.52
16.52
16.5
16.5
16.4799
16.41
16.5
16.99
16.99
16.45
16.81
16.55
16.6
16.9
16.75
16.75
16.75
16.6
17.59
17.5
17.35
17.38
16.99
16.99
17
17
16.8
17.2
16.8
16.8
16.76
17.48
16.98
16.8
16.76
16.76
16.5
16.2
15.75
16
15.75
15.8
15.8
15.95
15.95
15.9
15.68
15.79
15.8
15.72
15.75
15.91
15.92
15.92
16.35
16.35
16.35
16.15
16.3
16.18
16.18
15.61
15.6
15.65
15.65
15.65
15.48
15.4201
15.33
15.32
15.41
15.41
15.41
15.15
15.59
16
16.25
16.5
16.5
16.9999
16.9
16.75
16.39
16.35
16.85
16.85
16.85
16.1
16.35
16.2
16.5
16.5
15.73
15.5
15.26
15.26
15.48
16.58
16.77
11/30/06 16.25
FUND SNAPSHOT
------------------------------------
Common Share Price $16.25
------------------------------------
Common Share
Net Asset Value $15.10
------------------------------------
Premium/(Discount) to NAV 7.62%
------------------------------------
Market Yield 4.62%
------------------------------------
Taxable-Equivalent Yield1 6.84%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $29,702
------------------------------------
Average Effective Maturity
on Securities (Years) 13.80
------------------------------------
Leverage-Adjusted Duration 7.18
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) 7.29% 5.33%
------------------------------------
1-Year 4.83% 7.83%
------------------------------------
5-Year 7.45% 7.59%
------------------------------------
Since
Inception 7.34% 6.98%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Health Care 19.7%
------------------------------------
Education and Civic
Organizations 16.0%
------------------------------------
Water and Sewer 12.5%
------------------------------------
U.S. Guaranteed 11.9%
------------------------------------
Tax Obligation/General 10.4%
------------------------------------
Utilities 7.2%
------------------------------------
Housing/Single Family 6.2%
------------------------------------
Tax Obligation/Limited 3.7%
------------------------------------
Other 12.4%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 32.5%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
9
Nuveen Georgia Dividend Advantage Municipal Fund 2
NKG
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 79%
AA 8%
A 2%
BBB 9%
BB or Lower 2%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Dec 0.059
Jan 0.059
Feb 0.059
Mar 0.056
Apr 0.056
May 0.056
Jun 0.0515
Jul 0.0515
Aug 0.0515
Sep 0.0515
Oct 0.0515
Nov 0.053
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 13.29
13.32
13.24
13.28
13.34
13.44
13.26
13.5
13.34
13.46
13.48
13.22
13.28
13.33
13.3599
13.3
13.3
13.38
13.39
13.36
13.58
13.58
13.4048
13.44
13.57
13.75
13.64
13.78
13.65
13.95
13.74
13.77
13.69
13.71
13.66
13.75
13.78
13.71
13.44
13.55
13.56
13.68
13.75
13.84
13.77
13.7
13.9
13.89
13.89
13.97
13.49
13.68
13.57
13.87
13.8
13.85
13.9
13.68
13.65
13.7
13.83
13.87
13.77
13.65
13.73
13.58
13.79
13.84
13.76
13.81
13.71
13.7
13.96
13.66
13.62
13.55
13.63
13.8
13.8
13.74
13.6
13.59
13.65
13.97
13.73
13.6
13.75
13.47
13.6412
13.68
13.52
13.5
13.6
13.43
13.41
13.36
13.35
13.35
13.28
13.35
13.39
13.47
13.3553
13.3553
13.35
13.51
13.33
13.34
13.28
13.33
13.51
13.51
13.33
13.25
13.3
13.18
13.38
13.51
13.4
13.4
13.25
13.15
13.11
13.3
13.3
13.26
13.47
13.56
13.5
13.3411
13.25
13.15
13.14
13.12
13.09
13
13.1
13.07
13.01
12.99
12.97
12.92
12.85
12.84
12.95
12.95
12.94
13.03
13.12
13.07
13.12
13.1301
13.25
13.25
13.17
13
12.98
12.98
12.97
12.97
12.97
13.09
13.09
13.05
13.07
13.16
13.14
13.26
13.28
13.44
13.65
13.73
13.77
13.6
13.56
13.48
13.34
13.34
13.37
13.55
13.58
13.56
13.56
13.35
13.35
13.38
13.54
13.58
13.52
13.44
13.5
13.5
13.6
13.35
13.45
13.49
13.66
13.65
13.56
13.54
13.51
13.53
13.4101
13.64
13.54
13.55
13.51
13.5
13.5501
13.64
13.63
13.63
13.46
13.54
13.55
13.52
13.5
13.5499
13.55
13.5108
13.4501
13.52
13.56
13.49
13.46
13.4239
13.53
13.53
13.48
13.57
13.49
13.44
13.649
13.75
13.7
13.8
13.74
13.8
13.69
13.69
13.81
13.73
13.72
13.75
13.8
13.7
13.8
13.75
13.56
13.5603
13.5603
13.59
13.5401
13.75
11/30/06 13.8
FUND SNAPSHOT
------------------------------------
Common Share Price $13.80
------------------------------------
Common Share
Net Asset Value $14.82
------------------------------------
Premium/(Discount) to NAV -6.88%
------------------------------------
Market Yield 4.61%
------------------------------------
Taxable-Equivalent Yield1 6.83%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $67,501
------------------------------------
Average Effective Maturity
on Securities (Years) 17.29
------------------------------------
Leverage-Adjusted Duration 8.17
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/02)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) 6.49% 6.24%
------------------------------------
1-Year 8.89% 8.75%
------------------------------------
Since
Inception 3.34% 6.11%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Water and Sewer 16.9%
------------------------------------
Health Care 16.8%
------------------------------------
Tax Obligation/Limited 16.0%
------------------------------------
Education and Civic
Organizations 11.0%
------------------------------------
Tax Obligation/General 8.4%
------------------------------------
U.S. Guaranteed 7.9%
------------------------------------
Utilities 5.5%
------------------------------------
Transportation 3.9%
------------------------------------
Other 13.6%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 32.5%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
10
Nuveen North Carolina Premium Income Municipal Fund
NNC
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 50%
AA 32%
A 10%
BBB 6%
N/R 2%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Dec 0.0645
Jan 0.0645
Feb 0.0645
Mar 0.061
Apr 0.061
May 0.061
Jun 0.0575
Jul 0.0575
Aug 0.0575
Sep 0.0545
Oct 0.0545
Nov 0.0545
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 14.72
15.03
14.91
14.86
14.87
14.801
14.82
14.53
14.45
14.51
14.64
14.67
14.75
15.0799
14.98
15.15
15.19
15.31
15.4
15.37
15.6
15.6
15.45
15.71
15.7
15.55
15.56
15.28
15.05
15.12
15.16
15.56
15.5
15.6
15.7
15.72
15.95
16
16.35
16.27
16.11
16.14
16.02
15.9
15.79
15.841
15.8
15.86
15.75
16.1
16.14
15.75
15.94
15.7
15.68
15.69
15.72
15.74
15.97
15.96
16.1
16.03
15.56
15.7
15.55
15.51
15.51
15.4
15.45
15.4
15.25
15.29
15.47
15.43
15.5
15.47
15.45
15.39
15.32
15.53
15.53
15.51
15.25
15.19
15.2
15.1
15.4
15.53
15.03
15.02
14.81
15.15
15.05
15
15.3
15.3
15.4799
15.05
14.9
14.8601
14.84
14.6392
14.78
14.78
14.82
14.99
14.8
14.9
14.86
14.6
14.85
14.75
14.6
14.68
14.85
14.74
14.55
14.77
15.01
15.05
14.81
14.91
14.85
14.8899
15
15.09
15.04
15.2
15.2
15.09
15.3
15.11
14.9478
15.24
15.24
15.25
15.3
15.25
15.3
15.25
14.97
14.97
15.19
15.18
15.17
14.95
14.86
14.88
14.97
14.59
14.6851
14.64
14.64
14.73
14.87
14.61
14.51
14.45
14.45
14.45
14.5
14.75
14.84
14.8
14.71
14.7
14.6999
14.6
14.7
14.65
14.46
14.51
14.65
14.556
14.71
14.75
14.65
14.66
14.75
14.85
14.94
14.94
14.8
14.78
14.83
14.8
14.76
14.76
14.8
14.8
14.77
14.76
14.84
14.8
14.74
14.85
14.73
14.7
14.87
14.7501
14.97
14.74
14.7
14.7499
14.65
14.73
14.66
14.5926
14.58
14.47
14.45
14.45
14.4401
14.5
14.43
14.49
14.38
14.29
14.3
14.24
14.3
14.2599
14.26
14.22
14.25
14.25
14.28
14.21
14.26
14.32
14.28
14.35
14.43
14.43
14.42
14.67
14.48
14.4
14.33
14.3199
14.28
14.3
14.26
14.3
14.34
14.36
14.31
14.3499
14.31
14.33
14.31
14.39
14.4399
14.5
11/30/06 14.68
FUND SNAPSHOT
------------------------------------
Common Share Price $14.68
------------------------------------
Common Share
Net Asset Value $14.83
------------------------------------
Premium/(Discount) to NAV -1.01%
------------------------------------
Market Yield 4.46%
------------------------------------
Taxable-Equivalent Yield1 6.76%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $94,214
------------------------------------
Average Effective Maturity
on Securities (Years) 16.60
------------------------------------
Leverage-Adjusted Duration 8.08
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 5/20/93)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) -0.47% 5.83%
------------------------------------
1-Year 7.23% 7.27%
------------------------------------
5-Year 4.98% 6.94%
------------------------------------
10-Year 6.49% 6.73%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Tax Obligation/Limited 20.8%
------------------------------------
Health Care 19.6%
------------------------------------
Education and Civic
Organizations 16.9%
------------------------------------
Utilities 8.5%
------------------------------------
U.S. Guaranteed 7.5%
------------------------------------
Housing/Single Family 5.4%
------------------------------------
Tax Obligation/General 5.1%
------------------------------------
Transportation 4.6%
------------------------------------
Other 11.6%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
2 The Fund paid shareholders capital gains and net ordinary income
distributions in December 2005 of $0.1628 per share.
11
Nuveen North Carolina Dividend Advantage Municipal Fund
NRB
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 60%
AA 24%
A 8%
BBB 5%
N/R 3%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Dec 0.0735
Jan 0.0735
Feb 0.0735
Mar 0.07
Apr 0.07
May 0.07
Jun 0.0665
Jul 0.0665
Aug 0.0665
Sep 0.0635
Oct 0.0635
Nov 0.0635
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 16.66
16.5
16.1
15.81
15.98
16.3
16.02
16
16.2
16.29
16.24
16.24
16.52
16.43
16.05
16.04
16.28
16.11
16.44
16.56
17.04
17.04
17.14
17.02
17.47
17.47
17.75
17.75
17.75
17.75
17.45
17.2
16.85
17
16.98
16.98
16.99
16.86
16.98
17
16.71
16.82
16.82
16.8
16.71
16.71
16.6
16.31
16.45
16.48
16.48
16.51
16.6
16.6
16.65
16.65
16.65
16.71
17.1
17.05
17.4
17.42
17.45
17.55
17.6
17.55
17.53
17.53
17.32
17.75
17.5
17.2101
17.2101
17.2101
17.2101
17.9
17.65
17.9
17.67
17.92
17.6
17.55
17.4
17.25
17.55
17.48
17.6
17.6
17.32
17.85
17.85
17.7
17.02
17.3
16.85
16.85
17.3
17.27
17.27
17.27
17.07
16.96
16.73
16.73
16.96
16.9
16.9
16.9
16.73
17.25
17.25
17.25
17.18
17.18
16.98
16.99
17
16.99
17.2
16.97
17.14
17.14
17.3
17.45
17.27
17.7
17.75
17.75
17.75
17.26
17.26
17.26
17.26
17.26
17.26
17.26
17.26
17.26
17.04
17.04
17.3
17.4
17.55
17.41
17.41
17.41
17.6
17.76
17.9
17.71
17.7
17.7
17.21
17.23
17.07
17.12
17
16.66
16.5
16.69
16.25
16.25
16.25
16.1
16.1
16.09
15.9
15.98
15.91
16
15.86
16
16
16.01
16.01
16.01
16.05
15.96
16.15
16.15
16.25
16.25
16.25
16.25
16.1
16.24
16.05
16.06
16.09
16.27
16.45
16.48
16.33
16.22
16.22
16.71
16.24
16.45
16.25
16.16
16.38
16.34
16.84
16.7
17
16.65
16.65
16.16
16.02
16.06
16.07
16.07
16.2
16.37
16.37
16.26
16.26
16.26
16.25
16.25
16.07
16.09
15.94
15.92
15.99
16
15.99
15.81
15.61
15.71
15.45
15.55
15.55
15.55
15.8
15.87
15.71
16.09
16.14
16.19
16.01
16.0101
15.94
15.99
15.94
15.94
15.94
15.93
15.85
15.86
15.86
16.15
16.13
16
11/30/06 15.69
FUND SNAPSHOT
------------------------------------
Common Share Price $15.69
------------------------------------
Common Share
Net Asset Value $15.30
------------------------------------
Premium/(Discount) to NAV 2.55%
------------------------------------
Market Yield 4.86%
------------------------------------
Taxable-Equivalent Yield1 7.36%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $34,552
------------------------------------
Average Effective Maturity
on Securities (Years) 15.54
------------------------------------
Leverage-Adjusted Duration 7.83
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 1/25/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) -9.21% 5.59%
------------------------------------
1-Year -2.52% 7.43%
------------------------------------
5-Year 6.72% 7.55%
------------------------------------
Since
Inception 6.50% 7.27%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Water and Sewer 20.4%
------------------------------------
Education and Civic
Organizations 13.7%
------------------------------------
Tax Obligation/Limited 13.6%
------------------------------------
Utilities 13.5%
------------------------------------
Health Care 13.4%
------------------------------------
U.S. Guaranteed 5.9%
------------------------------------
Housing/Multifamily 4.1%
------------------------------------
Tax Obligation/General 3.9%
------------------------------------
Other 11.5%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
12
Nuveen North Carolina Dividend Advantage Municipal Fund 2
NNO
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 68%
AA 17%
A 10%
BBB 2%
N/R 3%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Dec 0.0685
Jan 0.0685
Feb 0.0685
Mar 0.065
Apr 0.065
May 0.065
Jun 0.0615
Jul 0.0615
Aug 0.0615
Sep 0.058
Oct 0.058
Nov 0.058
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 15.34
15.26
15
14.77
14.84
15
15.04
15
14.9
14.96
14.92
15.15
15.18
15.02
14.96
15
15
15.08
15.07
15.45
15.6
15.6
15.39
15.6
15.7
15.69
15.8
15.8
15.84
15.7
15.8
15.86
15.8
15.8
15.96
15.94
15.9999
15.98
16.1
16.1
16.1
16.13
16.18
16.13
15.85
16
15.55
15.45
15.5
15.75
15.7
15.75
15.75
15.94
15.97
15.9
15.56
15.7
15.7
15.7
16.1
15.85
15.95
15.4
15.4
15.65
15.55
15.65
15.62
15.68
15.75
15.95
16.19
16.19
16.25
16.05
16.1
16.09
16.09
16
15.9
15.8
15.54
15.55
15.8
15.45
15.55
15.55
15.85
15.81
15.6
15.6
15.5
15.54
15.35
15.35
15.2
15.1
15
15.07
15.05
15
15.07
15.07
15
15.01
15.19
15.2
15.34
15.4
15.51
15.45
15.4401
15.29
15.43
15.34
15.15
15.05
15.12
15.24
15.14
15.4
15.36
15.25
15.3
15.28
15.29
15.3
15.3
15.59
15.6
15.6499
15.6
15.65
15.85
16
16
15.95
15.88
15.8
15.8
15.8
15.86
15.86
15.68
15.562
15.45
15.45
15.4
15.23
14.9
14.98
15.13
15.15
14.99
14.96
14.9
14.88
14.88
15
15
15
15
15
14.9101
15.1
14.65
14.8
14.9
14.94
14.8899
14.91
14.91
14.85
14.85
14.82
14.88
14.88
14.88
14.94
14.98
14.97
15.05
15.09
15.26
15.18
15.18
15.18
15.11
15.08
15.23
15.23
15.2
15.02
15.12
15.17
15.25
15.25
15.16
15.2
15.1701
15.24
15.15
15.09
15.09
15.16
15.24
15.24
15.24
15.24
15.2
15.2
15.08
15.23
15.23
15.21
15.3006
15.2101
15.35
15.38
15.25
15.25
15.2
15.3
15.08
15.06
15.12
15.01
15.03
15
15.0899
15.02
15.04
15.16
15.17
15.24
15.14
15.1
15.05
15.09
15.03
15.02
14.92
15.0199
15.01
15.01
14.93
14.86
14.89
14.91
14.91
14.9
14.927
14.8201
11/30/06 14.93
FUND SNAPSHOT
------------------------------------
Common Share Price $14.93
------------------------------------
Common Share
Net Asset Value $15.28
------------------------------------
Premium/(Discount) to NAV -2.29%
------------------------------------
Market Yield 4.66%
------------------------------------
Taxable-Equivalent Yield1 7.06%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $57,256
------------------------------------
Average Effective Maturity
on Securities (Years) 13.71
------------------------------------
Leverage-Adjusted Duration 7.95
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 11/15/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) 0.05% 6.10%
------------------------------------
1-Year 1.98% 7.61%
------------------------------------
5-Year 5.68% 7.40%
------------------------------------
Since
Inception 5.70% 7.30%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Tax Obligation/Limited 20.2%
------------------------------------
Health Care 16.4%
------------------------------------
U.S. Guaranteed 13.0%
------------------------------------
Education and Civic
Organizations 10.9%
------------------------------------
Transportation 10.9%
------------------------------------
Water and Sewer 10.7%
------------------------------------
Utilities 8.8%
------------------------------------
Other 9.1%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
2 The Fund paid shareholders capital gains and net ordinary income
distributions in December 2005 of $0.1239 per share.
13
Nuveen North Carolina Dividend Advantage Municipal Fund 3
NII
Performance
OVERVIEW As of November 30, 2006
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 75%
AA 19%
A 2%
BBB 3%
N/R 1%
Bar Chart:
2005-2006 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Dec 0.061
Jan 0.061
Feb 0.061
Mar 0.058
Apr 0.058
May 0.058
Jun 0.0545
Jul 0.0545
Aug 0.0545
Sep 0.0545
Oct 0.0545
Nov 0.0545
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
12/01/05 13.78
13.74
13.64
13.63
13.6799
13.75
13.75
13.62
13.47
13.61
13.49
13.65
13.64
13.67
13.7
13.7
13.75
13.73
13.75
13.73
13.75
13.75
13.7499
14.07
14.01
14.12
14.24
14.17
14.2
14.3
14.3999
14.33
14.51
14.55
14.54
14.44
14.43
14.36
14.33
14.48
14.35
14.16
14.3
14.25
14.25
14.05
14.17
14.24
14.49
14.51
14.52
14.54
14.5
14.479
14.53
14.21
14.38
14.39
14.56
14.6
14.82
14.66
14.5
14.32
14.32
14.5
14.38
14.38
14.33
14.3
14.4
14.25
14.44
14.3
14.5
14.51
14.5
14.5
14.3
14.49
14.41
14.55
14.31
14.59
14.65
14.4
14.7
14.68
14.56
14.65
14.65
14.3
14.1
14.14
14.09
14.05
14.08
13.97
14.11
13.97
13.95
13.75
13.9
13.9
14.15
14.23
14.48
14.2001
14.75
14.65
14.75
14.7
14.43
14.22
14.25
14.17
14.2
14.2
14.26
14.26
14.4899
14.43
14.24
14.28
14.32
14.42
14.77
14.7
14.55
14.76
14.98
14.88
14.75
14.8
14.8
14.66
14.66
14.72
14.68
14.79
14.69
14.4
14.4
14.71
14.72
14.67
14.49
14.42
14.5
14.3
14.28
14.31
14.27
14.31
14.1
14.05
14.15
14.15
14.19
14.19
14.15
14.02
14.04
14.02
14.1
14.1
14.1
14.25
14.36
14.8999
14.67
14.66
14.5
14.4
14.24
14.25
14.4
14.3
14.27
14.27
14.2
14.2201
14.25
14.2
14.29
14.18
14.22
14.25
14.26
14.3
14.35
14.39
14.4
14.15
14.24
14.35
14.65
14.55
14.45
14.32
14.42
14.39
14.35
14.36
14.54
14.3601
14.5
14.54
14.65
14.6881
14.46
14.46
14.49
14.4
14.35
14.3499
14.3
14.18
14.22
14.21
14.21
14.21
14.21
14.27
14.31
14.27
14.38
14.25
14.18
14.36
14.19
14.18
14.2
14.22
14.34
14.45
14.24
14.2252
14.2
14.2
14.13
14.23
14.1
14
14
14.21
14.3976
14.8
14.36
14.43
14.43
14.21
14.25
14.19
11/30/06 14.2
FUND SNAPSHOT
------------------------------------
Common Share Price $14.20
------------------------------------
Common Share
Net Asset Value $14.77
------------------------------------
Premium/(Discount) to NAV -3.86%
------------------------------------
Market Yield 4.61%
------------------------------------
Taxable-Equivalent Yield1 6.98%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $58,070
------------------------------------
Average Effective Maturity
on Securities (Years) 16.10
------------------------------------
Leverage-Adjusted Duration 7.69
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/02)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
6-Month
(Cumulative) 0.73% 5.94%
------------------------------------
1-Year 6.74% 7.53%
------------------------------------
Since
Inception 3.83% 6.07%
------------------------------------
INDUSTRIES
(as a % of total investments)
------------------------------------
Water and Sewer 23.3%
------------------------------------
Tax Obligation/Limited 18.4%
------------------------------------
Tax Obligation/General 12.3%
------------------------------------
Utilities 10.0%
------------------------------------
Health Care 8.8%
------------------------------------
Education and Civic
Organizations 7.5%
------------------------------------
U.S. Guaranteed 6.9%
------------------------------------
Transportation 5.8%
------------------------------------
Other 7.0%
------------------------------------
1 Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
14
Shareholder
MEETING REPORT
The shareholder meeting was held in the offices of Nuveen Investments on
November 14, 2006.
NPG NZX NKG
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS
WAS REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner
For 3,546,182 -- 1,896,023 -- 4,346,865 --
Withhold 41,304 -- 24,369 -- 135,210 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
Lawrence H. Brown
For 3,542,476 -- 1,896,023 -- 4,343,465 --
Withhold 45,010 -- 24,369 -- 138,610 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
Jack B. Evans
For 3,546,182 -- 1,896,023 -- 4,345,165 --
Withhold 41,304 -- 24,369 -- 136,910 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
William C. Hunter
For 3,546,182 -- 1,896,023 -- 4,345,165 --
Withhold 41,304 -- 24,369 -- 136,910 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
David J. Kundert
For 3,546,182 -- 1,896,023 -- 4,346,865 --
Withhold 41,304 -- 24,369 -- 135,210 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
William J. Schneider
For -- 1,054 -- 586 -- 1,270
Withhold -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,054 -- 586 -- 1,270
====================================================================================================================================
Timothy R. Schwertfeger
For -- 1,054 -- 586 -- 1,270
Withhold -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,054 -- 586 -- 1,270
====================================================================================================================================
Judith M. Stockdale
For 3,540,332 -- 1,892,598 -- 4,338,315 --
Withhold 47,154 -- 27,794 -- 143,760 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
Eugene S. Sunshine
For 3,546,182 -- 1,896,023 -- 4,346,865 --
Withhold 41,304 -- 24,369 -- 135,210 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,587,486 -- 1,920,392 -- 4,482,075 --
====================================================================================================================================
15
Shareholder
MEETING REPORT (continued)
NNC NRB NNO
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS
WAS REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
====================================================================================================================================
Robert P. Bremner
For 5,916,432 -- 2,154,473 -- 3,659,408 --
Withhold 105,375 -- 91,776 -- 48,833 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
Lawrence H. Brown
For 5,919,639 -- 2,154,159 -- 3,659,408 --
Withhold 102,168 -- 92,090 -- 48,833 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
Jack B. Evans
For 5,913,907 -- 2,153,317 -- 3,660,545 --
Withhold 107,900 -- 92,932 -- 47,696 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
William C. Hunter
For 5,910,882 -- 2,152,803 -- 3,662,308 --
Withhold 110,925 -- 93,446 -- 45,933 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
David J. Kundert
For 5,908,432 -- 2,154,473 -- 3,659,408 --
Withhold 113,375 -- 91,776 -- 48,833 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
William J. Schneider
For -- 1,829 -- 648 -- 1,028
Withhold -- 13 -- 5 -- 17
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,842 -- 653 -- 1,045
====================================================================================================================================
Timothy R. Schwertfeger
For -- 1,829 -- 648 -- 1,028
Withhold -- 13 -- 5 -- 17
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,842 -- 653 -- 1,045
====================================================================================================================================
Judith M. Stockdale
For 5,911,269 -- 2,157,373 -- 3,662,702 --
Withhold 110,538 -- 88,876 -- 45,539 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
Eugene S. Sunshine
For 5,909,582 -- 2,154,473 -- 3,659,708 --
Withhold 112,225 -- 91,776 -- 48,533 --
------------------------------------------------------------------------------------------------------------------------------------
Total 6,021,807 -- 2,246,249 -- 3,708,241 --
====================================================================================================================================
16
NII
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS
WAS REACHED AS FOLLOWS:
Common and
MuniPreferred MuniPreferred
shares voting shares voting
together together
as a class as a class
====================================================================================================================================
Robert P. Bremner
For 3,830,273 --
Withhold 34,365 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
Lawrence H. Brown
For 3,828,973 --
Withhold 35,665 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
Jack B. Evans
For 3,821,522 --
Withhold 43,116 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
William C. Hunter
For 3,824,922 --
Withhold 39,716 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
David J. Kundert
For 3,824,906 --
Withhold 39,732 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
William J. Schneider
For -- 1,093
Withhold -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,093
====================================================================================================================================
Timothy R. Schwertfeger
For -- 1,093
Withhold -- --
------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,093
====================================================================================================================================
Judith M. Stockdale
For 3,823,622 --
Withhold 41,016 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
Eugene S. Sunshine
For 3,828,522 --
Withhold 36,116 --
------------------------------------------------------------------------------------------------------------------------------------
Total 3,864,638 --
====================================================================================================================================
17
Nuveen Georgia Premium Income Municipal Fund (NPG)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 5.4% (3.7% OF TOTAL INVESTMENTS)
$ 2,000 Cartersville Development Authority, Georgia, Water and 5/07 at 101.00 A+ $ 2,038,340
Wastewater Facilities Revenue Refunding Bonds, Anheuser
Busch Companies Inc., Series 1997, 6.125%, 5/01/27
(Alternative Minimum Tax)
1,000 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 1,050,610
Asset-Backed Refunding Bonds, Series 2002, 5.500%, 5/15/39
------------------------------------------------------------------------------------------------------------------------------------
3,000 Total Consumer Staples 3,088,950
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 18.7% (12.8% OF TOTAL INVESTMENTS)
1,000 Athens-Clarke County Unified Government Development 12/12 at 100.00 AAA 1,071,470
Authority, Georgia, Educational Facilities Revenue Bonds,
UGAREF CCRC Building LLC Project, Series 2002,
5.000%, 12/15/16 - AMBAC Insured
Atlanta Urban Residential Finance Authority, Georgia, Dormitory
Facility Revenue Refunding Bonds, Morehouse College Project,
Series 1995:
1,210 5.750%, 12/01/20 - MBIA Insured 12/06 at 101.00 AAA 1,224,121
1,375 5.750%, 12/01/25 - MBIA Insured 12/06 at 101.00 AAA 1,391,019
1,550 Bulloch County Development Authority, Georgia, Student 8/14 at 100.00 Aaa 1,691,221
Housing and Athletic Facility Lease Revenue Bonds,
Georgia Southern University, Series 2004, 5.250%, 8/01/21 -
XLCA Insured
700 Carrollton Payroll Development Authority, Georgia, Student 9/14 at 100.00 Aaa 746,466
Housing Revenue Bonds, University of West Georgia,
Series 2004A, 5.000%, 9/01/21 - XLCA Insured
1,535 Fulton County Development Authority, Georgia, Revenue 5/14 at 100.00 AAA 1,696,267
Bonds, Georgia Tech Molecular Science Building,
Series 2004, 5.250%, 5/01/15 - MBIA Insured
1,180 Savannah Economic Development Authority, Georgia, 7/15 at 100.00 AAA 1,265,444
Revenue Bonds, Armstrong Atlantic State University,
Compass Point LLC Project, Series 2005, 5.000%, 7/01/25 -
XLCA Insured
1,500 Savannah Economic Development Authority, Georgia, Revenue 12/15 at 100.00 AAA 1,602,525
Bonds, Armstrong Center LLC, Series 2005A,
5.000%, 12/01/34 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
10,050 Total Education and Civic Organizations 10,688,533
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 31.6% (21.6% OF TOTAL INVESTMENTS)
2,300 Chatham County Hospital Authority, Savannah, Georgia, 7/11 at 101.00 A3 2,529,126
Hospital Revenue Improvement Bonds, Memorial Health
University Medical Center Inc., Series 2001A, 6.125%, 1/01/24
2,000 Clarke County Hospital Authority, Georgia, Hospital Revenue 1/12 at 101.00 AAA 2,113,700
Certificates, Athens Regional Medical Center, Series 2002,
5.125%, 1/01/32 - MBIA Insured
900 Coffee County Hospital Authority, Georgia, Revenue Bonds, 12/14 at 100.00 BBB+ 950,823
Coffee County Regional Medical Center, Series 2004,
5.250%, 12/01/22
3,000 Floyd County Hospital Authority, Georgia, Revenue 7/12 at 101.00 Aaa 3,201,180
Anticipation Certificates, Floyd Medical Center Project,
Series 2002, 5.200%, 7/01/32 - MBIA Insured
1,090 Floyd County Hospital Authority, Georgia, Revenue Anticipation 7/13 at 101.00 Aaa 1,169,439
Certificates, Floyd Medical Center, Series 2003,
5.000%, 7/01/19 - MBIA Insured
1,750 Gainesville and Hall County Hospital Authority, Georgia, 5/11 at 100.00 A- 1,839,775
Revenue Anticipation Certificates, Northeast Georgia
Health Services Inc., Series 2001, 5.500%, 5/15/31
3,750 Gwinnett County Hospital Authority, Georgia, Revenue 2/12 at 102.00 AAA 4,053,150
Anticipation Certificates, Gwinnett Hospital System Inc.
Project, Series 1997B, 5.300%, 9/01/27 - MBIA Insured
1,060 Henry County Hospital Authority, Georgia, Revenue 7/14 at 101.00 Aaa 1,144,895
Certificates, Henry Medical Center, Series 2004,
5.000%, 7/01/20 - MBIA Insured
1,000 Savannah Hospital Authority, Georgia, Revenue Bonds, 1/14 at 100.00 AA 1,077,390
St. Joseph's/Candler Health System, Series 2003,
5.250%, 7/01/23 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
16,850 Total Health Care 18,079,478
------------------------------------------------------------------------------------------------------------------------------------
18
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 2.7% (1.8% OF TOTAL INVESTMENTS)
$ 1,500 Marietta Housing Authority, Georgia, GNMA Collateralized 4/07 at 102.00 AA $ 1,528,755
Multifamily Housing Revenue Bonds, Country Oaks Apartments,
Series 1996, 6.150%, 10/20/26 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 6.6% (4.5% OF TOTAL INVESTMENTS)
900 Georgia Housing and Finance Authority, Single Family 12/11 at 100.00 AAA 936,261
Mortgage Bonds, Series 2002B-2, 5.350%, 12/01/22
(Alternative Minimum Tax)
2,675 Georgia Housing and Finance Authority, Single Family 12/10 at 100.00 AAA 2,827,876
Mortgage Resolution 1 Bonds, Series 2001A-2,
5.700%, 12/01/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
3,575 Total Housing/Single Family 3,764,137
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 0.8% (0.7% OF TOTAL INVESTMENTS)
500 Savannah Economic Development Authority, Georgia, 7/12 at 100.00 AAA 528,895
Revenue Bonds, GTREP Project, Series 2002,
5.000%, 7/01/22 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 3.3% (2.2% OF TOTAL INVESTMENTS)
750 Effingham County Industrial Development Authority, 6/11 at 101.00 B2 799,463
Georgia, Pollution Control Revenue Refunding Bonds,
Georgia-Pacific Project, Series 2001, 6.500%, 6/01/31
1,000 Richmond County Development Authority, Georgia, 2/11 at 101.00 BBB 1,072,710
Environmental Improvement Revenue Bonds, International
Paper Company, Series 2001A, 6.250%, 2/01/25
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,750 Total Materials 1,872,173
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 9.1% (6.2% OF TOTAL INVESTMENTS)
2,500 Georgia, General Obligation Bonds, Series 2002D, 5.000%, 8/01/16 8/12 at 100.00 AAA 2,684,550
1,000 Georgia, General Obligation Bonds, Series 2005B, 5.000%, 7/01/15 No Opt. Call AAA 1,107,650
800 Puerto Rico, General Obligation and Public Improvement Bonds, 7/14 at 100.00 BBB 868,936
Series 2004A, 5.250%, 7/01/22
500 Wayne County Hospital Authority, Georgia, Hospital Revenue 3/16 at 100.00 Aaa 535,325
Bonds, Series 2006, 5.000%, 3/01/23 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
4,800 Total Tax Obligation/General 5,196,461
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 28.5% (19.4% OF TOTAL INVESTMENTS)
5,000 Atlanta and Fulton County Recreation Authority, Georgia, 12/15 at 100.00 AAA 5,388,598
Guaranteed Revenue Bonds, Park Improvement, Series 2005A,
5.000%, 12/01/30 - MBIA Insured
2,000 Cobb-Marietta Coliseum and Exhibit Hall Authority, Cobb 1/14 at 100.00 AAA 2,145,880
County, Georgia, Revenue Bonds, Performing Arts Center,
Series 2004, 5.000%, 1/01/22
3,475 Cobb-Marietta Coliseum and Exhibit Hall Authority, Georgia, 10/19 at 100.00 AAA 4,154,641
Revenue Refunding Bonds, Series 1993, 5.625%, 10/01/26 -
MBIA Insured
2,600 Macon-Bibb County Urban Development Authority, Georgia, 8/12 at 101.00 AA 2,849,574
Revenue Refunding Bonds, Public Facilities Projects,
Series 2002A, 5.375%, 8/01/17
1,000 Metropolitan Atlanta Rapid Transit Authority, Georgia, Sales No Opt. Call AAA 1,192,290
Tax Revenue Refunding Bonds, Series 1992P, 6.250%, 7/01/20 -
AMBAC Insured
500 Puerto Rico Infrastructure Financing Authority, Special Tax 7/15 at 100.00 BBB+ 526,910
Revenue Bonds, Series 2005B, 5.000%, 7/01/41
------------------------------------------------------------------------------------------------------------------------------------
14,575 Total Tax Obligation/Limited 16,257,893
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 4.3% (2.9% OF TOTAL INVESTMENTS)
2,290 Atlanta, Georgia, Airport General Revenue Bonds, Series 2004G, 1/15 at 100.00 AAA 2,444,346
5.000%, 1/01/26 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 12.6% (8.6% OF TOTAL INVESTMENTS) (4)
885 Coweta County Development Authority, Georgia, Revenue Bonds, 1/13 at 100.00 Aaa 966,924
Newnan Water and Sewer, and Light Commission Project,
Series 2002, 5.250%, 1/01/18 (Pre-refunded 1/01/13) -
FGIC Insured
3,165 Coweta County Water and Sewer Authority, Georgia, Revenue 6/11 at 102.00 Aaa 3,437,665
Bonds, Series 2001, 5.250%, 6/01/26 (Pre-refunded 6/01/11)
2,500 DeKalb County, Georgia, Water and Sewerage Revenue Bonds, 10/10 at 101.00 AA (4) 2,666,875
Series 2000, 5.125%, 10/01/31 (Pre-refunded 10/01/10)
19
Nuveen Georgia Premium Income Municipal Fund (NPG) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
Georgia Municipal Electric Authority, Project One Special
Obligation Bonds, Fifth Crossover Series 1998Y:
$ 85 6.400%, 1/01/09 (ETM) No Opt. Call A+ (4) $ 89,895
10 6.400%, 1/01/09 (ETM) No Opt. Call A+ (4) 10,576
25 Georgia Municipal Electric Authority, Senior Lien General 1/17 at 100.00 AAA 28,816
Power Revenue Bonds, Series 1993Z, 5.500%, 1/01/20
(Pre-refunded 1/01/17) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
6,670 Total U.S. Guaranteed 7,200,751
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 8.7% (5.9% OF TOTAL INVESTMENTS)
1,000 Fairburn, Georgia, Combined Utility Revenue Bonds, 10/10 at 101.00 BBB 1,057,570
Series 2000, 5.750%, 10/01/20
1,655 Georgia Municipal Electric Authority, Project One Special No Opt. Call A+ 1,747,018
Obligation Bonds, Fifth Crossover Series 1998Y,
6.400%, 1/01/09
975 Georgia Municipal Electric Authority, Senior Lien General Power No Opt. Call AAA 1,100,629
Revenue Bonds, Series 1993Z, 5.500%, 1/01/20 - FGIC Insured
1,000 Municipal Electric Authority of Georgia, Project One 1/13 at 100.00 AAA 1,060,160
Subordinated Lien Revenue Bonds, Series 2003A,
5.000%, 1/01/22 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
4,630 Total Utilities 4,965,377
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 14.3% (9.7% OF TOTAL INVESTMENTS)
Atlanta, Georgia, Water and Wastewater Revenue Bonds,
Series 2004:
1,225 5.000%, 11/01/24 - FSA Insured 11/14 at 100.00 AAA 1,311,277
500 5.000%, 11/01/37 - FSA Insured 11/14 at 100.00 AAA 533,110
Augusta, Georgia, Water and Sewerage Revenue Bonds,
Series 2002:
500 5.000%, 10/01/16 - FSA Insured 10/12 at 100.00 AAA 534,625
1,990 5.000%, 10/01/17 - FSA Insured 10/12 at 100.00 AAA 2,127,270
335 Coweta County Water and Sewer Authority, Georgia, 6/11 at 102.00 Aaa 361,164
Revenue Bonds, Series 2001, 5.250%, 6/01/26
1,950 Fulton County, Georgia, Water and Sewerage Revenue Bonds, 1/14 at 100.00 AAA 2,088,489
Series 2004, 5.000%, 1/01/22 - FGIC Insured
1,000 Midgeville, Georgia, Water and Sewerage Revenue Refunding No Opt. Call AAA 1,212,600
Bonds, Series 1996, 6.000%, 12/01/21 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
7,500 Total Water and Sewer 8,168,535
------------------------------------------------------------------------------------------------------------------------------------
$ 77,690 Total Investments (cost $78,976,911) - 146.6% 83,784,284
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.1% 1,155,715
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.7)% (27,800,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 57,139,999
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
Such investments are normally considered to be
equivalent to AAA rated securities.
(ETM) Escrowed to maturity.
See accompanying notes to financial statements.
20
Nuveen Georgia Dividend Advantage Municipal Fund (NZX)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY - 2.5% (1.7% OF TOTAL INVESTMENTS)
$ 750 DeKalb County Development Authority, Georgia, Pollution 12/12 at 101.00 B- $ 767,310
Control Revenue Refunding Bonds, General Motors
Corporation Projects, Series 2002, 6.000%, 3/15/21
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 3.7% (2.5% OF TOTAL INVESTMENTS)
1,000 Cartersville Development Authority, Georgia, Waste and 2/12 at 100.00 A+ 1,091,700
Wastewater Facilities Revenue Refunding Bonds, Anheuser
Busch Cos. Inc. Project, Series 2002, 5.950%, 2/01/32
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 23.8% (16.0% OF TOTAL INVESTMENTS)
1,000 Athens Housing Authority, Georgia, Student Housing Lease 12/12 at 100.00 Aaa 1,072,460
Revenue Bonds, UGAREF East Campus Housing LLC Project,
Series 2002, 5.250%, 12/01/21 - AMBAC Insured
1,475 Bulloch County Development Authority, Georgia, Student 8/14 at 100.00 Aaa 1,611,438
Housing and Athletic Facility Lease Revenue Bonds, Georgia
Southern University, Series 2004, 5.250%, 8/01/20 -
XLCA Insured
1,620 Bulloch County Development Authority, Georgia, Student Housing 8/12 at 100.00 Aaa 1,728,022
Lease Revenue Bonds, Georgia Southern University,
Series 2002, 5.000%, 8/01/20 - AMBAC Insured
500 Carrollton Payroll Development Authority, Georgia, Student 9/14 at 100.00 Aaa 533,190
Housing Revenue Bonds, University of West Georgia,
Series 2004A, 5.000%, 9/01/21 - XLCA Insured
1,485 Fulton County Development Authority, Georgia, Revenue 4/12 at 100.00 AAA 1,578,748
Bonds, Georgia Tech Athletic Association, Series 2001,
5.000%, 10/01/20 - AMBAC Insured
500 Savannah Economic Development Authority, Georgia, Revenue 12/15 at 100.00 AAA 534,175
Bonds, Armstrong Center LLC, Series 2005A,
5.000%, 12/01/34 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
6,580 Total Education and Civic Organizations 7,058,033
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 29.3% (19.7% OF TOTAL INVESTMENTS)
150 Baldwin County Hospital Authority, Georgia, Revenue Bonds, 12/07 at 102.00 BB+ 150,504
Oconee Regional Medical Center, Series 1997,
5.250%, 12/01/12
120 Baldwin County Hospital Authority, Georgia, Revenue Bonds, 12/08 at 102.00 BB+ 120,085
Oconee Regional Medical Center, Series 1998,
5.375%, 12/01/28
210 Chatham County Hospital Authority, Savannah, Georgia, 7/11 at 101.00 A3 230,920
Hospital Revenue Improvement Bonds, Memorial Health
University Medical Center Inc., Series 2001A, 6.125%, 1/01/24
1,000 Clarke County Hospital Authority, Georgia, Hospital Revenue 1/12 at 101.00 AAA 1,078,760
Certificates, Athens Regional Medical Center, Series 2002,
5.375%, 1/01/19 - MBIA Insured
500 Coffee County Hospital Authority, Georgia, Revenue Bonds, 12/14 at 100.00 BBB+ 528,235
Coffee County Regional Medical Center, Series 2004,
5.250%, 12/01/22
1,250 Gainesville and Hall County Hospital Authority, Georgia, 5/11 at 100.00 A- 1,314,125
Revenue Anticipation Certificates, Northeast Georgia
Health Services Inc., Series 2001, 5.500%, 5/15/31
1,900 Gwinnett County Hospital Authority, Georgia, Revenue 2/12 at 102.00 AAA 2,053,596
Anticipation Certificates, Gwinnett Hospital System Inc.
Project, Series 1997B, 5.300%, 9/01/27 - MBIA Insured
500 Henry County Hospital Authority, Georgia, Revenue Certificates, 7/14 at 101.00 Aaa 540,045
Henry Medical Center, Series 2004, 5.000%, 7/01/20 -
MBIA Insured
500 Savannah Hospital Authority, Georgia, Revenue Bonds, 1/14 at 100.00 AA 538,695
St. Joseph's/Candler Health System, Series 2003,
5.250%, 7/01/23 - RAAI Insured
2,000 Valdosta and Lowndes County Hospital Authority, Georgia, 10/12 at 101.00 AAA 2,153,940
Revenue Certificates, South Georgia Medical Center,
Series 2002, 5.250%, 10/01/27 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
8,130 Total Health Care 8,708,905
------------------------------------------------------------------------------------------------------------------------------------
21
Nuveen Georgia Dividend Advantage Municipal Fund (NZX) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 3.5% (2.4% OF TOTAL INVESTMENTS)
$ 990 DeKalb County Housing Authority, Georgia, GNMA 8/11 at 103.00 Aaa $ 1,048,638
Collateralized Multifamily Housing Revenue Bonds,
Castaways Apartments, Series 2001A, 5.400%, 2/20/29
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 9.3% (6.2% OF TOTAL INVESTMENTS)
650 Georgia Housing and Finance Authority, Single Family 12/11 at 100.00 AAA 676,189
Mortgage Bonds, Series 2002B-2, 5.350%, 12/01/22
(Alternative Minimum Tax)
2,000 Georgia Housing and Finance Authority, Single Family 12/11 at 100.00 AAA 2,075,740
Mortgage Resolution 1 Bonds, Series 2002A-2,
5.450%, 12/01/22 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
2,650 Total Housing/Single Family 2,751,929
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 2.7% (1.8% OF TOTAL INVESTMENTS)
750 Savannah Economic Development Authority, Georgia, 7/12 at 100.00 AAA 799,358
Revenue Bonds, GTREP Project, Series 2002,
5.000%, 7/01/19 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 2.1% (1.6% OF TOTAL INVESTMENTS)
600 Richmond County Development Authority, Georgia, 2/12 at 101.00 BBB 645,102
Environmental Improvement Revenue Refunding Bonds,
International Paper Company, Series 2002A, 6.000%, 2/01/25
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 11.3% (7.6% OF TOTAL INVESTMENTS)
2,000 Georgia, General Obligation Bonds, Series 2002D, 5.000%, 8/01/18 8/12 at 100.00 AAA 2,141,820
500 Georgia, General Obligation Bonds, Series 2005B, 5.000%, 7/01/15 No Opt. Call AAA 553,825
595 Puerto Rico, General Obligation and Public Improvement Bonds, 7/14 at 100.00 BBB 646,271
Series 2004A, 5.250%, 7/01/22
------------------------------------------------------------------------------------------------------------------------------------
3,095 Total Tax Obligation/General 3,341,916
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 5.6% (3.7% OF TOTAL INVESTMENTS)
1,525 Macon-Bibb County Urban Development Authority, Georgia, 8/12 at 101.00 AA 1,648,678
Revenue Refunding Bonds, Public Facilities Projects,
Series 2002A, 5.000%, 8/01/14
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 3.6% (2.4% OF TOTAL INVESTMENTS)
1,000 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA 1,057,150
Series 2000A, 5.400%, 1/01/15 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 17.7% (11.9% OF TOTAL INVESTMENTS) (4)
1,100 Atlanta Development Authority, Georgia, Revenue Bonds, 1/12 at 100.00 AAA 1,178,089
Yamacraw Design Center Project, Series 2001A,
5.125%, 1/01/27 (Pre-refunded 1/01/12) - MBIA Insured
1,500 Coweta County Development Authority, Georgia, Revenue 1/13 at 100.00 Aaa 1,638,855
Bonds, Newnan Water and Sewer, and Light Commission
Project, Series 2002, 5.250%, 1/01/18 (Pre-refunded 1/01/13) -
FGIC Insured
1,250 Private Colleges and Universities Authority, Georgia, Revenue 10/11 at 102.00 Baa2 (4) 1,389,575
Bonds, Mercer University, Series 2001, 5.750%, 10/01/31
(Pre-refunded 10/01/11)
1,000 Rockdale County Water and Sewerage Authority, Georgia, 1/10 at 101.00 AAA 1,063,500
Revenue Bonds, Series 1999A, 5.375%, 7/01/29
(Pre-refunded 1/01/10) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
4,850 Total U.S. Guaranteed 5,270,019
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 10.7% (7.2% OF TOTAL INVESTMENTS)
1,250 Municipal Electric Authority of Georgia, Combustion Turbine 11/07 at 100.00 AAA 1,351,775
Revenue Bonds, Series 2002A, 5.250%, 11/01/20 -
MBIA Insured
500 Municipal Electric Authority of Georgia, Combustion Turbine 11/13 at 100.00 AAA 548,515
Revenue Bonds, Series 2003A, 5.250%, 11/01/15 -
MBIA Insured
1,200 Summerville, Georgia, Combined Public Utility System Revenue 1/12 at 101.00 Baa3 1,277,880
Refunding and Improvement Bonds, Series 2002,
5.750%, 1/01/26
------------------------------------------------------------------------------------------------------------------------------------
2,950 Total Utilities 3,178,170
------------------------------------------------------------------------------------------------------------------------------------
22
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 18.6% (12.5% OF TOTAL INVESTMENTS)
$ 1,200 Atlanta, Georgia, Water and Wastewater Revenue Bonds, 11/14 at 100.00 AAA $ 1,284,516
Series 2004, 5.000%, 11/01/24 - FSA Insured
2,065 Augusta, Georgia, Water and Sewerage Revenue Bonds, 10/12 at 100.00 AAA 2,207,999
Series 2002, 5.000%, 10/01/16 - FSA Insured
500 Fulton County, Georgia, Water and Sewerage Revenue Bonds, 1/14 at 100.00 AAA 535,510
Series 2004, 5.000%, 1/01/22 - FGIC Insured
1,395 Macon Water Authority, Georgia, Water and Sewer Revenue 10/11 at 101.00 AA- 1,487,837
Bonds, Series 2001B, 5.000%, 10/01/21
------------------------------------------------------------------------------------------------------------------------------------
5,160 Total Water and Sewer 5,515,862
------------------------------------------------------------------------------------------------------------------------------------
$ 40,030 Total Long-Term Investments (cost $40,689,509) - 144.4% 42,882,770
=============-----------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 4.2% (2.8% OF TOTAL INVESTMENTS)
$ 1,250 Puerto Rico Government Development Bank, Adjustable A-1 1,250,000
============= Refunding Bonds, Variable Rate Demand Obligations,
Series 1985, 3.470%, 12/01/15 - MBIA Insured (5)
--------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $1,250,000) 1,250,000
--------------------------------------------------------------------------------------------------------------------
Total Investments (cost $41,939,509) - 148.6% 44,132,770
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.9% 568,929
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (50.5)% (15,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 29,701,699
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
Such investments are normally considered to be
equivalent to AAA rated securities.
(5) Investment has a maturity of more than one year, but
has variable rate and demand features which qualify it
as a short-term investment. The rate disclosed is that
in effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
See accompanying notes to financial statements.
23
Nuveen Georgia Dividend Advantage Municipal Fund 2 (NKG)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY - 2.7% (1.8% OF TOTAL INVESTMENTS)
$ 1,750 DeKalb County Development Authority, Georgia, Pollution 12/12 at 101.00 B- $ 1,790,390
Control Revenue Refunding Bonds, General Motors
Corporation Projects, Series 2002, 6.000%, 3/15/21
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 3.1% (2.1% OF TOTAL INVESTMENTS)
2,000 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 2,101,220
Asset-Backed Refunding Bonds, Series 2002, 5.500%, 5/15/39
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 16.1% (11.0% OF TOTAL INVESTMENTS)
Athens Housing Authority, Georgia, Student Housing Lease Revenue
Bonds, UGAREF East Campus Housing LLC Project, Series 2002:
3,500 5.000%, 12/01/27 - AMBAC Insured 12/12 at 100.00 Aaa 3,682,280
2,500 5.000%, 12/01/33 - AMBAC Insured 12/12 at 100.00 Aaa 2,622,050
1,225 Athens-Clarke County Unified Government Development 12/12 at 100.00 AAA 1,311,522
Authority, Georgia, Educational Facilities Revenue Bonds,
UGAREF CCRC Building LLC Project, Series 2002,
5.000%, 12/15/18 - AMBAC Insured
2,000 Fulton County Development Authority, Georgia, Revenue 11/13 at 100.00 AAA 2,137,240
Bonds, Georgia Tech - Klaus Parking and Family Housing,
Series 2003, 5.000%, 11/01/23 - MBIA Insured
1,050 Fulton County Development Authority, Georgia, Revenue Bonds, 2/12 at 100.00 AAA 1,104,044
TUFF Morehouse Project, Series 2002A, 5.000%, 2/01/34 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
10,275 Total Education and Civic Organizations 10,857,136
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 24.7% (16.8% OF TOTAL INVESTMENTS)
150 Baldwin County Hospital Authority, Georgia, Revenue Bonds, 12/07 at 102.00 BB+ 150,504
Oconee Regional Medical Center, Series 1997,
5.250%, 12/01/12
Baldwin County Hospital Authority, Georgia, Revenue Bonds,
Oconee Regional Medical Center, Series 1998:
40 5.250%, 12/01/22 12/08 at 102.00 BB+ 39,074
165 5.375%, 12/01/28 12/08 at 102.00 BB+ 165,117
1,000 Chatham County Hospital Authority, Savannah, Georgia, 1/14 at 100.00 A3 1,073,870
Hospital Revenue Bonds, Memorial Health University Medical
Center Inc., Series 2004A, 5.375%, 1/01/26
Coffee County Hospital Authority, Georgia, Revenue Bonds, Coffee
County Regional Medical Center, Series 2004:
165 5.000%, 12/01/19 12/14 at 100.00 BBB+ 171,425
1,000 5.250%, 12/01/22 12/14 at 100.00 BBB+ 1,056,470
Floyd County Hospital Authority, Georgia, Revenue Anticipation
Certificates, Floyd Medical Center Project, Series 2002:
1,480 5.000%, 7/01/22 - MBIA Insured 7/12 at 101.00 Aaa 1,567,912
1,000 5.200%, 7/01/32 - MBIA Insured 7/12 at 101.00 Aaa 1,067,060
1,305 Gainesville and Hall County Hospital Authority, Georgia, 5/11 at 100.00 A- 1,371,946
Revenue Anticipation Certificates, Northeast Georgia Health
Services Inc., Series 2001, 5.500%, 5/15/31
Newnan Hospital Authority, Georgia, Revenue Anticipation
Certificates, Newnan Hospital Inc., Series 2002:
2,260 5.500%, 1/01/19 - MBIA Insured 1/13 at 100.00 Aaa 2,463,739
3,020 5.500%, 1/01/20 - MBIA Insured 1/13 at 100.00 Aaa 3,290,532
2,000 Savannah Hospital Authority, Georgia, Revenue Bonds, 1/14 at 100.00 AA 2,154,780
St. Joseph's/Candler Health System, Series 2003,
5.250%, 7/01/23 - RAAI Insured
1,945 Tift County Hospital Authority, Georgia, Revenue Anticipation 12/12 at 101.00 Aaa 2,097,157
Bonds, Tift Regional Medical Center, Series 2002,
5.250%, 12/01/19 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
15,530 Total Health Care 16,669,586
------------------------------------------------------------------------------------------------------------------------------------
24
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 4.5% (3.1% OF TOTAL INVESTMENTS)
Savannah Economic Development Authority, Georgia, GNMA
Collateralized Multifamily Housing Revenue Bonds, Snap I-II-III
Apartments, Series 2002A:
$ 500 5.150%, 11/20/22 (Alternative Minimum Tax) 11/12 at 102.00 AAA $ 520,610
980 5.200%, 11/20/27 (Alternative Minimum Tax) 11/12 at 102.00 AAA 1,021,385
1,465 5.250%, 11/20/32 (Alternative Minimum Tax) 11/12 at 102.00 AAA 1,528,434
------------------------------------------------------------------------------------------------------------------------------------
2,945 Total Housing/Multifamily 3,070,429
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 4.2% (2.9% OF TOTAL INVESTMENTS)
1,700 Georgia Housing and Finance Authority, Single Family Mortgage 12/12 at 100.00 AAA 1,763,546
Bonds, Series 2002C-2, 5.100%, 12/01/22 (Alternative
Minimum Tax)
1,075 Georgia Housing and Finance Authority, Single Family 6/11 at 100.00 AAA 1,088,169
Mortgage Resolution 1 Bonds, Series 2001B-2,
5.400%, 12/01/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
2,775 Total Housing/Single Family 2,851,715
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 3.4% (2.3% OF TOTAL INVESTMENTS)
2,190 Cobb County Development Authority, Georgia, Solid Waste 4/16 at 101.00 BBB 2,264,613
Disposal Revenue Bonds, Georgia Waste Management
Project, Series 2004A, 5.000%, 4/01/33 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 2.0% (1.4% OF TOTAL INVESTMENTS)
1,000 Richmond County Development Authority, Georgia, 2/11 at 101.00 BBB 1,072,710
Environmental Improvement Revenue Bonds, International
Paper Company, Series 2001A, 6.250%, 2/01/25 (Alternative
Minimum Tax)
250 Richmond County Development Authority, Georgia, 2/12 at 101.00 BBB 268,793
Environmental Improvement Revenue Refunding Bonds,
International Paper Company, Series 2002A, 6.000%, 2/01/25
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,250 Total Materials 1,341,503
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 12.4% (8.4% OF TOTAL INVESTMENTS)
1,000 Cherokee County School System, Georgia, General Obligation 8/13 at 100.00 AAA 1,082,300
Bonds, Series 2003, 5.000%, 8/01/16 - MBIA Insured
1,000 Forsyth County, Georgia, General Obligation Bonds, 3/14 at 101.00 AA 1,102,460
Series 2004, 5.250%, 3/01/19
750 Georgia, General Obligation Bonds, Series 1998D, 5.250%, 10/01/15 No Opt. Call AAA 846,548
1,000 Georgia, General Obligation Bonds, Series 2005B, 5.000%, 7/01/15 No Opt. Call AAA 1,107,650
Oconee County, Georgia, General Obligation Bonds, Recreation
Project, Series 2003:
1,410 5.500%, 1/01/23 - AMBAC Insured 1/13 at 101.00 Aaa 1,551,931
1,470 5.250%, 1/01/26 - AMBAC Insured 1/13 at 101.00 Aaa 1,593,157
1,000 Wayne County Hospital Authority, Georgia, Hospital Revenue 3/16 at 100.00 Aaa 1,070,650
Bonds, Series 2006, 5.000%, 3/01/23 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
7,630 Total Tax Obligation/General 8,354,696
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 23.5% (16.0% OF TOTAL INVESTMENTS)
750 Georgia Municipal Association Inc., Certificates of Participation, 6/12 at 101.00 AAA 803,092
Atlanta Court Project, Series 2002, 5.125%, 12/01/21 -
AMBAC Insured
2,500 Metropolitan Atlanta Rapid Transit Authority, Georgia, Sales No Opt. Call AAA 2,980,725
Tax Revenue Refunding Bonds, Series 1992P, 6.250%, 7/01/20 -
AMBAC Insured
500 Puerto Rico Infrastructure Financing Authority, Special Tax 7/15 at 100.00 BBB+ 526,910
Revenue Bonds, Series 2005B, 5.000%, 7/01/41
Puerto Rico Municipal Finance Agency, Series 2002A:
800 5.250%, 8/01/21 - FSA Insured 8/12 at 100.00 AAA 864,976
2,500 5.000%, 8/01/27 - FSA Insured 8/12 at 100.00 AAA 2,637,225
5,000 Puerto Rico Public Buildings Authority, Guaranteed Government No Opt. Call AAA 5,772,498
Facilities Revenue Refunding Bonds, Series 2002F,
5.250%, 7/01/21 - CIFG Insured
2,000 Puerto Rico, Highway Revenue Bonds, Highway and 7/16 at 100.00 AAA 2,285,640
Transportation Authority, Series 1996Y, 5.500%, 7/01/36 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
14,050 Total Tax Obligation/Limited 15,871,066
------------------------------------------------------------------------------------------------------------------------------------
25
Nuveen Georgia Dividend Advantage Municipal Fund 2 (NKG) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 5.7% (3.9% OF TOTAL INVESTMENTS)
$ 3,650 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA $ 3,864,730
Series 2000A, 5.500%, 1/01/21 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 11.6% (7.9% OF TOTAL INVESTMENTS) (4)
DeKalb County, Georgia, Water and Sewerage Revenue Bonds,
Series 2000:
2,500 5.125%, 10/01/31 (Pre-refunded 10/01/10) 10/10 at 101.00 AA (4) 2,666,875
2,500 5.375%, 10/01/35 (Pre-refunded 10/01/10) 10/10 at 101.00 AA (4) 2,689,125
1,000 Private Colleges and Universities Authority, Georgia, Revenue 9/11 at 100.00 AA (4) 1,069,850
Bonds, Emory University, Series 2001A, 5.125%, 9/01/33
(Pre-refunded 9/01/11)
1,250 Private Colleges and Universities Authority, Georgia, Revenue 10/11 at 102.00 Baa2 (4) 1,389,575
Bonds, Mercer University, Series 2001, 5.750%, 10/01/31
(Pre-refunded 10/01/11)
------------------------------------------------------------------------------------------------------------------------------------
7,250 Total U.S. Guaranteed 7,815,425
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 8.0% (5.5% OF TOTAL INVESTMENTS)
1,000 Elberton, Georgia, Combined Utility System Revenue Refunding 1/12 at 100.00 Aaa 1,053,100
and Improvement Bonds, Series 2001, 5.000%, 1/01/22 -
AMBAC Insured
1,300 Fairburn, Georgia, Combined Utility Revenue Bonds, 10/10 at 101.00 BBB 1,374,841
Series 2000, 5.750%, 10/01/20
1,000 Municipal Electric Authority of Georgia, Project One 1/13 at 100.00 AAA 1,060,160
Subordinated Lien Revenue Bonds, Series 2003A,
5.000%, 1/01/22 - MBIA Insured
1,775 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/12 at 101.00 AAA 1,942,436
Series 2002II, 5.375%, 7/01/19 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
5,075 Total Utilities 5,430,537
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 24.8% (16.9% OF TOTAL INVESTMENTS)
Atlanta, Georgia, Water and Wastewater Revenue Bonds,
Series 2004:
500 5.250%, 11/01/15 - FSA Insured 11/14 at 100.00 AAA 554,140
1,700 5.000%, 11/01/37 - FSA Insured 11/14 at 100.00 AAA 1,812,574
Augusta, Georgia, Water and Sewerage Revenue Bonds,
Series 2002:
1,000 5.250%, 10/01/22 - FSA Insured 10/12 at 100.00 AAA 1,077,920
3,500 5.000%, 10/01/27 - FSA Insured 10/12 at 100.00 AAA 3,697,190
1,000 Douglasville-Douglas County Water and Sewer Authority, 12/15 at 100.00 AAA 1,073,800
Georgia, Water and Sewer Revenue Bonds, Series 2005,
5.000%, 6/01/29 - MBIA Insured
4,000 Forsyth County Water and Sewerage Authority, Georgia, 4/13 at 100.00 AA 4,240,080
Revenue Bonds, Series 2002, 5.000%, 4/01/32
26
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER (continued)
$ 950 Fulton County, Georgia, Water and Sewerage Revenue Bonds, 7/08 at 101.00 AAA $ 978,975
Series 1998, 5.000%, 1/01/16 - FGIC Insured
3,100 Harris County, Georgia, Water System Revenue Bonds, 12/12 at 100.00 Aaa 3,291,146
Series 2002, 5.000%, 12/01/22 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
15,750 Total Water and Sewer 16,725,825
------------------------------------------------------------------------------------------------------------------------------------
$ 92,120 Total Investments (cost $94,779,264) - 146.7% 99,008,871
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.2% 1,491,767
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.9)% (33,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 67,500,638
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
Such investments are normally considered to be
equivalent to AAA rated securities.
See accompanying notes to financial statements.
27
Nuveen North Carolina Premium Income Municipal Fund (NNC)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 25.2% (16.9% OF TOTAL INVESTMENTS)
$ 1,000 North Carolina Capital Facilities Financing Agency, Housing 6/13 at 100.00 AAA $ 1,062,640
Revenue Bonds, Elizabeth City State University, Series 2003A,
5.000%, 6/01/28 - AMBAC Insured
2,500 North Carolina Capital Facilities Financing Agency, Revenue 10/15 at 100.00 AA+ 2,671,925
Bonds, Duke University, Series 2005A, 5.000%, 10/01/41
970 North Carolina Capital Facilities Financing Agency, Revenue 4/13 at 100.00 AAA 1,042,556
Bonds, Johnson and Wales University, Series 2003A,
5.250%, 4/01/23 - XLCA Insured
3,285 North Carolina State University at Raleigh, General Revenue 10/13 at 100.00 AA 3,561,334
Bonds, Series 2003A, 5.000%, 10/01/15
1,530 University of North Carolina System, Pooled Revenue Bonds, No Opt. Call AAA 1,681,853
Series 2005A, 5.000%, 4/01/15 - AMBAC Insured
1,000 University of North Carolina System, Pooled Revenue Refunding 10/12 at 100.00 AAA 1,088,240
Bonds, Series 2002A, 5.375%, 4/01/22 - AMBAC Insured
University of North Carolina Wilmington, Certificates of
Participation, Student Housing Project Revenue Bonds,
Series 2006:
1,430 5.000%, 6/01/23 - FGIC Insured 6/16 at 100.00 AAA 1,546,245
1,505 5.000%, 6/01/24 - FGIC Insured 6/16 at 100.00 AAA 1,624,858
500 5.000%, 6/01/37 - FGIC Insured 6/16 at 100.00 AAA 535,730
University of North Carolina, Chapel Hill, System Net Revenue
Bonds, Series 2003:
2,380 5.000%, 12/01/19 12/13 at 100.00 AA+ 2,585,394
2,725 5.000%, 12/01/21 12/13 at 100.00 AA+ 2,920,928
1,500 5.000%, 12/01/23 12/13 at 100.00 AA+ 1,607,850
1,675 University of North Carolina, Wilmington, General Revenue 1/12 at 101.00 Aaa 1,780,944
Bonds, Series 2002A, 5.000%, 1/01/23 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
22,000 Total Education and Civic Organizations 23,710,497
------------------------------------------------------------------------------------------------------------------------------------
ENERGY - 1.8% (1.2% OF TOTAL INVESTMENTS)
1,500 Virgin Islands Public Finance Authority, Revenue Bonds, 1/14 at 100.00 BBB 1,670,955
Refinery Project - Hovensa LLC, Series 2003,
6.125%, 7/01/22 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 29.2% (19.6% OF TOTAL INVESTMENTS)
250 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/15 at 100.00 AA 263,373
Healthcare System Revenue Bonds, DBA Carolinas
Healthcare System, Series 2005A, 5.000%, 1/15/45
5,000 North Carolina Medical Care Commission, Health System 10/11 at 101.00 AA 5,296,396
Revenue Bonds, Mission St. Joseph's Health System,
Series 2001, 5.250%, 10/01/31
2,000 North Carolina Medical Care Commission, Healthcare Facilities 11/13 at 100.00 AA- 2,121,900
Revenue Bonds, Novant Health Obligated Group,
Series 2003A, 5.000%, 11/01/19
2,000 North Carolina Medical Care Commission, Healthcare 10/09 at 101.00 A- 2,137,520
Facilities Revenue Bonds, Stanly Memorial Hospital,
Series 1999, 6.375%, 10/01/29
North Carolina Medical Care Commission, Healthcare Facilities
Revenue Bonds, Union Regional Medical Center, Series 2002A:
1,000 5.500%, 1/01/19 1/12 at 100.00 A 1,063,410
550 5.500%, 1/01/20 1/12 at 100.00 A 584,359
1,750 5.375%, 1/01/32 1/12 at 100.00 A 1,834,648
1,615 North Carolina Medical Care Commission, Hospital Revenue 10/08 at 101.00 AA 1,643,505
Bonds, FirstHealth of the Carolinas Inc., Series 1998,
4.750%, 10/01/26
3,000 North Carolina Medical Care Commission, Hospital Revenue 6/12 at 101.00 A 3,179,520
Bonds, Southeastern Regional Medical Center, Series 2002,
5.375%, 6/01/32
28
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE (continued)
$ 2,645 North Carolina Medical Care Commission, Revenue Bonds, 1/15 at 100.00 AAA $ 2,817,639
Blue Ridge Healthcare System, Series 2005,
5.000%, 1/01/33 - FGIC Insured
North Carolina Medical Care Commission, Revenue Bonds,
Cleveland County Healthcare System, Series 2004A:
600 5.250%, 7/01/20 - AMBAC Insured 7/14 at 100.00 AAA 654,996
500 5.250%, 7/01/22 - AMBAC Insured 7/14 at 100.00 AAA 544,110
735 North Carolina Medical Care Commission, Revenue Bonds, 11/14 at 100.00 AA 778,556
Northeast Medical Center, Series 2004, 5.000%, 11/01/24
375 North Carolina Medical Care Commission, Revenue Bonds, 1/16 at 100.00 N/R 392,978
Pines at Davidson, Series 2006A, 5.000%, 1/01/36
Onslow County Hospital Authority, North Carolina, FHA Insured
Mortgage Revenue Bonds, Onslow Memorial Hospital Project, Series
2006:
685 5.000%, 4/01/31 - MBIA Insured 10/16 at 100.00 AAA 735,313
3,210 5.000%, 10/01/34 - MBIA Insured 10/16 at 100.00 AAA 3,438,520
------------------------------------------------------------------------------------------------------------------------------------
25,915 Total Health Care 27,486,743
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 3.7% (2.5% OF TOTAL INVESTMENTS)
1,000 Asheville Housing Authority, North Carolina, GNMA-Collateralized 11/07 at 102.00 AA 1,025,850
Multifamily Housing Revenue Bonds, Woodridge Apartments,
Series 1997, 5.800%, 11/20/39 (Alternative Minimum Tax)
2,290 Mecklenburg County, North Carolina, FNMA Multifamily 7/13 at 105.00 AAA 2,445,789
Housing Revenue Bonds, Little Rock Apartments, Series 2003,
5.375%, 1/01/36 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
3,290 Total Housing/Multifamily 3,471,639
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 8.0% (5.4% OF TOTAL INVESTMENTS)
1,105 North Carolina Housing Finance Agency, Home Ownership 7/10 at 100.00 AAA 1,135,012
Revenue Bonds, 1998 Trust Agreement, Series 10A,
5.400%, 7/01/32 - AMBAC Insured (Alternative Minimum Tax)
3,650 North Carolina Housing Finance Agency, Home Ownership 7/09 at 100.00 AA 3,809,505
Revenue Bonds, 1998 Trust Agreement, Series 6A,
6.200%, 1/01/29 (Alternative Minimum Tax)
835 North Carolina Housing Finance Agency, Home Ownership 7/16 at 100.00 AA 852,326
Revenue Bonds, Series 25-A, 4.900%, 7/01/37 (Alternative
Minimum Tax)
1,715 North Carolina Housing Finance Agency, Single Family 3/07 at 101.00 AA 1,750,312
Revenue Bonds, Series 1996HH, 6.300%, 3/01/26 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
7,305 Total Housing/Single Family 7,547,155
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.4% (1.0% OF TOTAL INVESTMENTS)
1,400 North Carolina Capital Facilities Financing Agency, Exempt No Opt. Call BBB 1,396,710
Facilities Revenue Bonds, Waste Management Inc.,
Series 2001, 3.750%, 8/01/14 (Mandatory put 8/01/07)
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 0.2% (0.2% OF TOTAL INVESTMENTS)
250 North Carolina Medical Care Commission, Revenue Bonds, 9/15 at 100.00 N/R 260,210
United Church Homes and Services, Series 2005A,
5.250%, 9/01/21
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 3.8% (2.6% OF TOTAL INVESTMENTS)
1,425 Gaston County Industrial Facilities and Pollution Control 8/15 at 100.00 N/R 1,536,663
Financing Authority, North Carolina, National Gypsum
Company Project Exempt Facilities Revenue Bonds,
Series 2005, 5.750%, 8/01/35 (Alternative Minimum Tax)
2,000 Haywood County Industrial Facilities and Pollution Control 3/07 at 101.00 Baa3 2,042,840
Financing Authority, North Carolina, Pollution Control
Revenue Refunding Bonds, Champion International Corporation,
Series 1995, 6.000%, 3/01/20
------------------------------------------------------------------------------------------------------------------------------------
3,425 Total Materials 3,579,503
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 7.6% (5.1% OF TOTAL INVESTMENTS)
1,890 Craven County, North Carolina, General Obligation Bonds, 5/12 at 101.00 AAA 2,015,496
Series 2002, 5.000%, 5/01/21 - AMBAC Insured
4,285 Durham County, North Carolina, General Obligation Bonds, 4/12 at 100.00 AAA 4,575,823
Series 2002B, 5.000%, 4/01/16
29
Nuveen North Carolina Premium Income Municipal Fund (NNC) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 500 North Carolina, General Obligation Bonds, Series 2004A, 3/14 at 100.00 AAA $ 539,175
5.000%, 3/01/22
------------------------------------------------------------------------------------------------------------------------------------
6,675 Total Tax Obligation/General 7,130,494
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 31.0% (20.8% OF TOTAL INVESTMENTS)
1,330 Cabarrus County, North Carolina, Certificates of Participation, 2/13 at 100.00 AA- 1,438,368
Series 2002, 5.250%, 2/01/17
1,800 Catawba County, North Carolina, Certificates of Participation, 6/14 at 100.00 Aaa 1,962,252
Series 2004, 5.250%, 6/01/21 - MBIA Insured
1,700 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 1,841,287
Governmental Facilities Projects, Series 2003G,
5.375%, 6/01/26
1,500 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 1,575,945
Transit Projects, Series 2003A, 5.000%, 6/01/33
Charlotte, North Carolina, Storm Water Fee Revenue Bonds,
Series 2002:
1,050 5.250%, 6/01/20 6/12 at 101.00 AAA 1,145,246
1,750 5.000%, 6/01/25 6/12 at 101.00 AAA 1,863,488
1,000 Davidson County, North Carolina, Certificates of Participation, No Opt. Call AAA 1,103,980
Series 2004, 5.250%, 6/01/14 - AMBAC Insured
Lee County, North Carolina, Certificates of Participation,
Public Schools and Community College, Series 2004:
1,715 5.250%, 4/01/18 - FSA Insured 4/14 at 100.00 AAA 1,872,008
500 5.250%, 4/01/20 - FSA Insured 4/14 at 100.00 AAA 544,175
1,000 5.250%, 4/01/22 - FSA Insured 4/14 at 100.00 AAA 1,085,690
2,600 North Carolina Infrastructure Finance Corporation, Certificates 2/15 at 100.00 AA+ 2,804,724
of Participation, Capital Improvements, Series 2005A,
5.000%, 2/01/19
1,500 North Carolina Infrastructure Finance Corporation, Certificates 2/14 at 100.00 AA+ 1,592,130
of Participation, Correctional Facilities, Series 2004A,
5.000%, 2/01/23
1,500 North Carolina, Certificates of Participation, Repair and 6/14 at 100.00 AA+ 1,601,910
Renovation Project, Series 2004B, 5.000%, 6/01/20
North Carolina, Certificates of Participation, Series 2003:
1,130 5.250%, 6/01/21 6/13 at 100.00 AA+ 1,214,524
1,000 5.250%, 6/01/23 6/13 at 100.00 AA+ 1,072,430
2,000 Puerto Rico Highway and Transportation Authority, Grant 3/14 at 100.00 AAA 2,156,120
Anticipation Revenue Bonds, Series 2004, 5.000%, 9/15/21 -
MBIA Insured
1,000 Puerto Rico Public Buildings Authority, Guaranteed Government No Opt. Call AAA 1,122,870
Facilities Revenue Bonds, Series 2003H, 5.250%, 7/01/15 -
FGIC Insured
1,000 Randolph County, North Carolina, Certificates of Participation, 6/14 at 102.00 AAA 1,086,950
Series 2004, 5.000%, 6/01/20 - FSA Insured
1,950 Sampson County, North Carolina, Certificates of Participation, 6/17 at 100.00 AAA 2,102,002
Series 2006, 5.000%, 6/01/34 - FSA Insured (UB)
------------------------------------------------------------------------------------------------------------------------------------
27,025 Total Tax Obligation/Limited 29,186,099
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 6.9% (4.6% OF TOTAL INVESTMENTS)
Charlotte, North Carolina, Airport Revenue Bonds, Series 2004A:
600 5.250%, 7/01/24 - MBIA Insured 7/14 at 100.00 AAA 650,886
2,710 5.000%, 7/01/29 - MBIA Insured 7/14 at 100.00 AAA 2,879,348
500 Piedmont Triad Airport Authority, North Carolina, Airport 7/15 at 100.00 AAA 541,115
Revenue Bonds, Series 2005A, 5.000%, 7/01/20 -
XLCA Insured
2,250 Raleigh Durham Airport Authority, North Carolina, Airport 5/11 at 101.00 Aaa 2,399,603
Revenue Bonds, Series 2001A, 5.250%, 11/01/16 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
6,060 Total Transportation 6,470,952
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 11.2% (7.5% OF TOTAL INVESTMENTS) (4)
2,000 Charlotte, North Carolina, Storm Water Fee Revenue Bonds, 6/10 at 101.00 AAA 2,180,860
Series 2000, 6.000%, 6/01/25 (Pre-refunded 6/01/10)
30
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
$ 750 Johnston County Finance Corporation, North Carolina, 8/09 at 101.00 AAA $ 790,268
Installment Payment Revenue Bonds, School and Museum
Projects, Series 1999, 5.250%, 8/01/21 (Pre-refunded
8/01/09) - FSA Insured
1,485 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 1,644,385
Revenue Bonds, Series 1980, 10.500%, 1/01/10 (ETM)
4,260 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 4,818,401
Revenue Bonds, Series 1986, 5.000%, 1/01/20 (ETM)
1,000 North Carolina, General Obligation Bonds, Series 2000A, 9/10 at 102.00 AAA 1,073,500
5.100%, 9/01/16 (Pre-refunded 9/01/10)
------------------------------------------------------------------------------------------------------------------------------------
9,495 Total U.S. Guaranteed 10,507,414
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 12.7% (8.5% OF TOTAL INVESTMENTS)
3,000 North Carolina Eastern Municipal Power Agency, Power System 1/13 at 100.00 BBB 3,248,430
Revenue Bonds, Series 2003F, 5.500%, 1/01/15
1,000 North Carolina Eastern Municipal Power Agency, Power System 1/16 at 100.00 AAA 1,107,660
Revenue Bonds, Series 2005, 5.250%, 1/01/20 -
AMBAC Insured
4,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/10 at 101.00 A3 4,347,760
Revenue Bonds, Series 1999B, 6.500%, 1/01/20
2,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 AAA 2,173,160
Revenue Bonds, Series 2003A, 5.250%, 1/01/15 -
AMBAC Insured
1,000 Wake County Industrial Facilities and Pollution Control 2/12 at 101.00 A3 1,067,620
Financing Authority, North Carolina, Revenue Refunding
Bonds, Carolina Power and Light Company, Series 2002,
5.375%, 2/01/17
------------------------------------------------------------------------------------------------------------------------------------
11,000 Total Utilities 11,944,630
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 6.1% (4.1% OF TOTAL INVESTMENTS)
1,605 Broad River Water Authority, North Carolina, Water System 6/15 at 100.00 Aaa 1,735,952
Revenue Bonds, Series 2005, 5.000%, 6/01/20 - XLCA Insured
1,295 Greensboro, North Carolina, Combined Enterprise System 6/15 at 100.00 AA+ 1,389,975
Revenue Bonds, Series 2005A, 5.000%, 6/01/26
500 Onslow County, North Carolina, Combined Enterprise System 6/14 at 100.00 AAA 533,635
Revenue Bonds, Series 2004B, 5.000%, 6/01/23 - XLCA Insured
2,000 Winston-Salem, North Carolina, Water and Sewerage System 6/12 at 100.00 AAA 2,131,960
Revenue Bonds, Series 2002A, 5.000%, 6/01/18
------------------------------------------------------------------------------------------------------------------------------------
5,400 Total Water and Sewer 5,791,522
------------------------------------------------------------------------------------------------------------------------------------
$ 130,740 Total Investments (cost $133,812,783) - 148.8% 140,154,523
=============-----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (1.4)% (1,300,000)
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.3% 2,159,681
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (49.7)% (46,800,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 94,214,204
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
N/R Not rated.
(ETM) Escrowed to maturity.
(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.
31
Nuveen North Carolina Dividend Advantage Municipal Fund (NRB)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 22.2% (13.7% OF TOTAL INVESTMENTS)
$ 380 North Carolina Capital Facilities Financing Agency, Revenue 10/11 at 100.00 AA+ $ 400,144
Bonds, Duke University, Series 2001A, 5.125%, 10/01/26
500 North Carolina Capital Facilities Financing Agency, Revenue 9/11 at 101.00 Baa2 524,140
Bonds, High Point University, Series 2001, 5.125%, 9/01/18
2,450 University of North Carolina System, Pooled Revenue Refunding 10/12 at 100.00 AAA 2,673,587
Bonds, Series 2002A, 5.375%, 4/01/17 - AMBAC Insured
250 University of North Carolina Wilmington, Certificates of 6/16 at 100.00 AAA 267,865
Participation, Student Housing Project Revenue Bonds,
Series 2006, 5.000%, 6/01/37 - FGIC Insured
1,750 University of North Carolina, Chapel Hill, System Net Revenue 6/11 at 100.00 AA+ 1,833,948
Bonds, Series 2001A, 5.000%, 12/01/25
1,845 University of North Carolina, Chapel Hill, System Net Revenue No Opt. Call AA+ 1,971,438
Bonds, Series 2002B, 5.000%, 12/01/11
------------------------------------------------------------------------------------------------------------------------------------
7,175 Total Education and Civic Organizations 7,671,122
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 21.7% (13.4% OF TOTAL INVESTMENTS)
100 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/15 at 100.00 AA 105,349
Healthcare System Revenue Bonds, DBA Carolinas Healthcare
System, Series 2005A, 5.000%, 1/15/45
1,000 North Carolina Medical Care Commission, Health System 10/11 at 101.00 AA 1,059,280
Revenue Bonds, Mission St. Joseph's Health System,
Series 2001, 5.250%, 10/01/31
1,110 North Carolina Medical Care Commission, Healthcare Facilities 1/12 at 100.00 A 1,174,025
Revenue Bonds, Union Regional Medical Center,
Series 2002A, 5.250%, 1/01/15
2,500 North Carolina Medical Care Commission, Healthcare Revenue 5/07 at 100.00 AA- 2,512,350
Bonds, Carolina Medicorp, Series 1996, 5.250%, 5/01/26
1,500 North Carolina Medical Care Commission, Hospital Revenue 6/12 at 101.00 A 1,585,320
Bonds, Southeastern Regional Medical Center, Series 2002,
5.250%, 6/01/22
300 North Carolina Medical Care Commission, Revenue Bonds, 1/15 at 100.00 AAA 319,581
Blue Ridge Healthcare System, Series 2005, 5.000%, 1/01/33 -
FGIC Insured
300 North Carolina Medical Care Commission, Revenue Bonds, 11/14 at 100.00 AA 317,778
Northeast Medical Center, Series 2004, 5.000%, 11/01/24
150 North Carolina Medical Care Commission, Revenue Bonds, 1/16 at 100.00 N/R 157,191
Pines at Davidson, Series 2006A, 5.000%, 1/01/36
255 Onslow County Hospital Authority, North Carolina, 10/16 at 100.00 AAA 273,730
FHA Insured Mortgage Revenue Bonds, Onslow Memorial
Hospital Project, Series 2006, 5.000%, 4/01/31 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
7,215 Total Health Care 7,504,604
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 6.7% (4.1% OF TOTAL INVESTMENTS)
2,225 Durham Housing Authority, North Carolina, FNMA Guaranteed 6/11 at 100.00 AAA 2,305,145
Multifamily Housing Revenue Bonds, Naples Terrace
Apartments, Series 2001A, 5.700%, 6/01/33 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 5.1% (3.2% OF TOTAL INVESTMENTS)
440 North Carolina Housing Finance Agency, Home Ownership 7/10 at 100.00 AAA 451,950
Revenue Bonds, 1998 Trust Agreement, Series 10A,
5.400%, 7/01/32 - AMBAC Insured (Alternative Minimum Tax)
965 North Carolina Housing Finance Agency, Home Ownership 7/09 at 100.00 AA 985,844
Revenue Bonds, 1998 Trust Agreement, Series 5A,
5.625%, 7/01/30 (Alternative Minimum Tax)
330 North Carolina Housing Finance Agency, Home Ownership 7/16 at 100.00 AA 336,848
Revenue Bonds, Series 25-A, 4.900%, 7/01/37 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,735 Total Housing/Single Family 1,774,642
------------------------------------------------------------------------------------------------------------------------------------
32
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.3% (0.8% OF TOTAL INVESTMENTS)
$ 500 North Carolina Capital Facilities Financing Agency, Exempt No Opt. Call BBB $ 498,825
Facilities Revenue Bonds, Waste Management Inc.,
Series 2001, 3.750%, 8/01/14 (Mandatory put 8/01/07)
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 2.3% (1.3% OF TOTAL INVESTMENTS)
300 North Carolina Medical Care Commission, Health Care 10/16 at 100.00 N/R 309,681
Facilities Revenue Bonds, Presbyterian Homes, Series 2006B,
5.200%, 10/01/21
200 North Carolina Medical Care Commission, Healthcare Facilities 10/16 at 100.00 N/R 208,192
Revenue Bonds, Presbyterian Homes, Series 2006,
5.400%, 10/01/27
250 North Carolina Medical Care Commission, Revenue Bonds, 9/15 at 100.00 N/R 260,210
United Church Homes and Services, Series 2005A,
5.250%, 9/01/21
------------------------------------------------------------------------------------------------------------------------------------
750 Total Long-Term Care 778,083
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 3.8% (2.4% OF TOTAL INVESTMENTS)
750 Columbus County Industrial Facilities and Pollution Control 4/07 at 102.00 BBB 769,245
Financing Authority, North Carolina, Environmental
Improvement Revenue Bonds, International Paper Company
Project, Series 1997A, 6.150%, 4/01/21 (Alternative
Minimum Tax)
515 Gaston County Industrial Facilities and Pollution Control 8/15 at 100.00 N/R 555,355
Financing Authority, North Carolina, National Gypsum
Company Project Exempt Facilities Revenue Bonds,
Series 2005, 5.750%, 8/01/35 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,265 Total Materials 1,324,600
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 6.3% (3.9% OF TOTAL INVESTMENTS)
North Carolina, General Obligation Bonds, Series 2004A:
1,000 5.000%, 3/01/18 3/14 at 100.00 AAA 1,085,490
1,000 5.000%, 3/01/22 3/14 at 100.00 AAA 1,078,350
------------------------------------------------------------------------------------------------------------------------------------
2,000 Total Tax Obligation/General 2,163,840
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 22.1% (13.6% OF TOTAL INVESTMENTS)
1,400 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 1,516,354
Governmental Facilities Projects, Series 2003G,
5.375%, 6/01/26
1,870 Dare County, North Carolina, Certificates of Participation, 12/12 at 100.00 AAA 2,027,884
Series 2002, 5.250%, 6/01/15 - AMBAC Insured
1,250 Davidson County, North Carolina, Certificates of Participation, 6/14 at 100.00 AAA 1,360,975
Series 2004, 5.250%, 6/01/21 - AMBAC Insured
1,390 Durham, North Carolina, Certificates of Participation, 6/15 at 100.00 AA+ 1,481,615
Series 2005B, 5.000%, 6/01/25
470 Raleigh, North Carolina, Certificates of Participation, 6/14 at 100.00 AA+ 501,932
Downtown Improvement Project, Series 2004B,
5.000%, 6/01/20
700 Sampson County, North Carolina, Certificates of 6/17 at 100.00 AAA 754,565
Participation, Series 2006, 5.000%, 6/01/34 -
FSA Insured (UB)
------------------------------------------------------------------------------------------------------------------------------------
7,080 Total Tax Obligation/Limited 7,643,325
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 6.2% (3.8% OF TOTAL INVESTMENTS)
450 Piedmont Triad Airport Authority, North Carolina, Airport 7/15 at 100.00 AAA 487,004
Revenue Bonds, Series 2005A, 5.000%, 7/01/20 -
XLCA Insured
1,530 Raleigh Durham Airport Authority, North Carolina, Airport 5/11 at 101.00 Aaa 1,640,451
Revenue Bonds, Series 2001A, 5.250%, 11/01/18 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
1,980 Total Transportation 2,127,455
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 9.7% (5.9% OF TOTAL INVESTMENTS) (4)
1,000 Broad River Water Authority, North Carolina, Water System 6/10 at 101.00 Aaa 1,069,990
Revenue Bonds, Series 2000, 5.375%, 6/01/26 (Pre-refunded
6/01/10) - MBIA Insured
500 Greensboro, North Carolina, Combined Enterprise System 6/11 at 101.00 AA+ (4) 537,310
Revenue Bonds, Series 2001A, 5.125%, 6/01/21
(Pre-refunded 6/01/11)
1,620 North Carolina Capital Facilities Financing Agency, Revenue 10/11 at 100.00 Aaa 1,734,242
Bonds, Duke University, Series 2001A, 5.125%, 10/01/26
(Pre-refunded 10/01/11)
------------------------------------------------------------------------------------------------------------------------------------
3,120 Total U.S. Guaranteed 3,341,542
------------------------------------------------------------------------------------------------------------------------------------
33
Nuveen North Carolina Dividend Advantage Municipal Fund (NRB) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 22.0% (13.5% OF TOTAL INVESTMENTS)
Greenville, North Carolina, Combined Enterprise System
Revenue Bonds, Series 2001:
$ 1,000 5.250%, 9/01/20 - FSA Insured 9/11 at 101.00 AAA $ 1,076,460
500 5.250%, 9/01/21 - FSA Insured 9/11 at 101.00 AAA 535,855
500 North Carolina Eastern Municipal Power Agency, Power System 1/16 at 100.00 AAA 553,830
Revenue Bonds, Series 2005, 5.250%, 1/01/20 -
AMBAC Insured
2,500 North Carolina Eastern Municipal Power Agency, Power System 1/07 at 100.00 AAA 2,503,725
Revenue Refunding Bonds, Series 1993B, 5.500%, 1/01/17 -
FGIC Insured
1,000 North Carolina Eastern Municipal Power Agency, Power System 1/09 at 102.00 BBB 1,053,360
Revenue Refunding Bonds, Series 1999B, 5.650%, 1/01/16
250 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/15 at 100.00 AAA 271,127
Series 2005RR, 5.000%, 7/01/24 - FGIC Insured
1,500 Wake County Industrial Facilities and Pollution Control 2/12 at 101.00 A3 1,601,430
Financing Authority, North Carolina, Revenue Refunding
Bonds, Carolina Power and Light Company, Series 2002,
5.375%, 2/01/17
------------------------------------------------------------------------------------------------------------------------------------
7,250 Total Utilities 7,595,787
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 33.2% (20.4% OF TOTAL INVESTMENTS)
2,250 Charlotte, North Carolina, Water and Sewerage System 6/11 at 101.00 AAA 2,392,086
Revenue Bonds, Series 2001, 5.125%,6/01/26
500 Greensboro, North Carolina, Combined Enterprise System 6/15 at 100.00 AA+ 536,670
Revenue Bonds, Series 2005A, 5.000%, 6/01/25
400 Onslow County, North Carolina, Combined Enterprise System 6/14 at 100.00 AAA 426,908
Revenue Bonds, Series 2004B, 5.000%, 6/01/23 - XLCA Insured
Raleigh, North Carolina, Combined Enterprise System Revenue
Bonds, Series 2006A:
4,500 5.000%, 3/01/31 (UB) 3/16 at 100.00 AAA 4,864,770
3,000 5.000%, 3/01/36 (UB) 3/16 at 100.00 AAA 3,233,535
------------------------------------------------------------------------------------------------------------------------------------
10,650 Total Water and Sewer 11,453,969
------------------------------------------------------------------------------------------------------------------------------------
$ 52,945 Total Investments (cost $53,839,981) - 162.6% 56,182,939
=============-----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (15.9)% (5,480,000)
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.5% 848,772
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (49.2)% (17,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 34,551,711
====================================================================================================================
FORWARD SWAPS OUTSTANDING AT NOVEMBER 30, 2006:
FUND FIXED RATE UNREALIZED
NOTIONAL PAY/RECEIVE FLOATING RATE FIXED RATE PAYMENT EFFECTIVE TERMINATION APPRECIATION
COUNTERPARTY AMOUNT FLOATING RATE INDEX (ANNUALIZED) FREQUENCY DATE (5) DATE (DEPRECIATION)
------------------------------------------------------------------------------------------------------------------------------------
Goldman Sachs $2,700,000 Receive 3 Month USD-LIBOR 5.682% Semi-Annually 7/10/07 7/10/12 $(102,243)
Goldman Sachs 800,000 Pay 3 Month USD-LIBOR 5.803 Semi-Annually 7/10/07 7/10/37 88,478
------------------------------------------------------------------------------------------------------------------------------------
$ (13,765)
====================================================================================================================================
USD-LIBOR (United States Dollar-London Inter-Bank Offered Rate)
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
Such investments are normally considered to be
equivalent to AAA rated securities.
(5) Effective date represents the date on which both the
Fund and counterparty commence interest payment
accruals on each forward swap contract.
N/R Not rated.
(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.
34
Nuveen North Carolina Dividend Advantage Municipal Fund 2 (NNO)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 16.7% (10.9% OF TOTAL INVESTMENTS)
Appalachian State University, North Carolina, Housing and
Student Center System Revenue Refunding Bonds, Series 2001:
$ 600 5.125%, 7/15/24 - MBIA Insured 1/11 at 101.00 Aaa $ 635,436
200 5.125%, 7/15/27 - MBIA Insured 1/11 at 101.00 Aaa 211,262
Appalachian State University, North Carolina, Housing and
Student Center System Revenue Refunding Bonds, Series 2002:
1,040 5.000%, 7/15/14 - MBIA Insured 7/12 at 100.00 Aaa 1,115,962
1,000 5.000%, 7/15/15 - MBIA Insured 7/12 at 100.00 Aaa 1,066,160
North Carolina Capital Facilities Financing Agency, Revenue
Bonds, Duke University, Series 2001A:
715 5.125%, 10/01/26 10/11 at 100.00 AA+ 752,902
380 5.125%, 10/01/41 10/11 at 100.00 AA+ 400,144
1,000 University of North Carolina System, Pooled Revenue Bonds, 4/15 at 100.00 AAA 1,080,180
Series 2005A, 5.000%, 4/01/22 - AMBAC Insured
1,100 University of North Carolina System, Pooled Revenue Refunding 10/12 at 100.00 AAA 1,199,176
Bonds, Series 2002A, 5.375%, 4/01/19 - AMBAC Insured
University of North Carolina Wilmington, Certificates of
Participation, Student Housing Project Revenue Bonds,
Series 2006:
500 5.000%, 6/01/21 - FGIC Insured 6/16 at 100.00 AAA 542,705
250 5.000%, 6/01/37 - FGIC Insured 6/16 at 100.00 AAA 267,865
1,500 University of North Carolina, Chapel Hill, System Net Revenue No Opt. Call AA+ 1,602,795
Bonds, Series 2002B, 5.000%, 12/01/11
250 University of North Carolina, Charlotte, Certificates of 3/15 at 100.00 AAA 269,323
Participation, Student Housing Project, Series 2005,
5.000%, 3/01/21 - AMBAC Insured
400 University of North Carolina, Greensboro, General Revenue 4/11 at 101.00 AAA 431,592
Refunding Bonds, Series 2002B, 5.375%, 4/01/17 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
8,935 Total Education and Civic Organizations 9,575,502
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 25.1% (16.4% OF TOTAL INVESTMENTS)
2,130 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/11 at 101.00 AA 2,216,201
Healthcare System Revenue Bonds, Carolinas Healthcare
System, Series 2001A, 5.000%, 1/15/31
200 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/15 at 100.00 AA 210,698
Healthcare System Revenue Bonds, DBA Carolinas Healthcare
System, Series 2005A, 5.000%, 1/15/45
1,000 North Carolina Medical Care Commission, Health System 10/11 at 101.00 AA 1,059,280
Revenue Bonds, Mission St. Joseph's Health System,
Series 2001, 5.250%, 10/01/31
2,000 North Carolina Medical Care Commission, Healthcare 11/13 at 100.00 AA- 2,119,160
Facilities Revenue Bonds, Novant Health Obligated Group,
Series 2003A, 5.000%, 11/01/20
1,005 North Carolina Medical Care Commission, Healthcare Facilities 1/12 at 100.00 A 1,068,204
Revenue Bonds, Union Regional Medical Center, Series 2002A,
5.250%, 1/01/13
North Carolina Medical Care Commission, Hospital Revenue
Bonds, Southeastern Regional Medical Center, Series 2002:
1,000 5.500%, 6/01/15 6/12 at 101.00 A 1,082,870
2,000 5.250%, 6/01/22 6/12 at 101.00 A 2,113,760
2,000 North Carolina Medical Care Commission, Revenue Bonds, 1/15 at 100.00 AAA 2,130,540
Blue Ridge Healthcare System, Series 2005, 5.000%, 1/01/33 -
FGIC Insured
35
Nuveen North Carolina Dividend Advantage Municipal Fund 2 (NNO) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE (continued)
North Carolina Medical Care Commission, Revenue Bonds,
Cleveland County Healthcare System, Series 2004A:
$ 595 5.250%, 7/01/20 - AMBAC Insured 7/14 at 100.00 AAA $ 649,538
500 5.250%, 7/01/22 - AMBAC Insured 7/14 at 100.00 AAA 544,110
500 North Carolina Medical Care Commission, Revenue Bonds, 11/14 at 100.00 AA 529,630
Northeast Medical Center, Series 2004, 5.000%, 11/01/24
185 North Carolina Medical Care Commission, Revenue Bonds, 1/16 at 100.00 N/R 193,869
Pines at Davidson, Series 2006A, 5.000%, 1/01/36
430 Onslow County Hospital Authority, North Carolina, 10/16 at 100.00 AAA 461,584
FHA Insured Mortgage Revenue Bonds, Onslow
Memorial Hospital Project, Series 2006, 5.000%, 4/01/31 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
13,545 Total Health Care 14,379,444
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 4.6% (3.0% OF TOTAL INVESTMENTS)
375 North Carolina Housing Finance Agency, Home Ownership 7/10 at 100.00 AAA 385,185
Revenue Bonds, 1998 Trust Agreement, Series 10A,
5.400%, 7/01/32 - AMBAC Insured (Alternative
Minimum Tax)
North Carolina Housing Finance Agency, Home Ownership
Revenue Bonds, Series 13A:
835 4.700%, 7/01/12 (Alternative Minimum Tax) 7/11 at 100.00 AA 857,128
840 4.850%, 7/01/13 (Alternative Minimum Tax) 7/11 at 100.00 AA 864,721
510 North Carolina Housing Finance Agency, Home Ownership 7/16 at 100.00 AA 520,583
Revenue Bonds, Series 25-A, 4.900%, 7/01/37 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
2,560 Total Housing/Single Family 2,627,617
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.4% (0.9% OF TOTAL INVESTMENTS)
800 North Carolina Capital Facilities Financing Agency, Exempt No Opt. Call BBB 798,120
Facilities Revenue Bonds, Waste Management Inc.,
Series 2001, 3.750%, 8/01/14 (Mandatory put 8/01/07)
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 2.0% (1.3% OF TOTAL INVESTMENTS)
600 North Carolina Medical Care Commission, Health Care 10/16 at 100.00 N/R 619,362
Facilities Revenue Bonds, Presbyterian Homes, Series 2006B,
5.200%, 10/01/21
250 North Carolina Medical Care Commission, Healthcare 10/16 at 100.00 N/R 260,240
Facilities Revenue Bonds, Presbyterian Homes, Series 2006,
5.400%, 10/01/27
250 North Carolina Medical Care Commission, Revenue Bonds, 9/15 at 100.00 N/R 260,210
United Church Homes and Services, Series 2005A,
5.250%, 9/01/21
------------------------------------------------------------------------------------------------------------------------------------
1,100 Total Long-Term Care 1,139,812
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 3.7% (2.4% OF TOTAL INVESTMENTS)
865 Gaston County Industrial Facilities and Pollution Control 8/15 at 100.00 N/R 932,781
Financing Authority, North Carolina, National Gypsum
Company Project Exempt Facilities Revenue Bonds,
Series 2005, 5.750%, 8/01/35 (Alternative Minimum Tax)
1,100 Northampton County Industrial Facilities and Pollution 2/11 at 101.00 BBB 1,177,561
Control Financing Authority, North Carolina, Environmental
Improvement Revenue Bonds, International Paper Company,
Series 2001A, 6.200%, 2/01/25 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,965 Total Materials 2,110,342
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 2.4% (1.5% OF TOTAL INVESTMENTS)
250 Durham County, North Carolina, General Obligation Bonds, 5/10 at 102.00 AAA 270,708
Series 2000, 5.600%, 5/01/15
1,000 North Carolina, General Obligation Bonds, Series 2004A, 3/14 at 100.00 AAA 1,078,350
5.000%, 3/01/22
------------------------------------------------------------------------------------------------------------------------------------
1,250 Total Tax Obligation/General 1,349,058
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 30.9% (20.2% OF TOTAL INVESTMENTS)
30 Cabarrus County, North Carolina, Certificates of Participation, 2/13 at 100.00 AA- 32,513
Series 2002, 5.250%, 2/01/16
1,750 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 1,841,647
Governmental Facilities Projects, Series 2003G,
5.000%, 6/01/28
1,850 Charlotte, North Carolina, Storm Water Fee Revenue Bonds, 6/12 at 101.00 AAA 2,017,814
Series 2002, 5.250%, 6/01/18
36
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
Hartnett County, North Carolina, Certificates of Participation,
Series 2002:
$ 1,000 5.250%, 12/01/15 - FSA Insured 12/12 at 101.00 AAA $ 1,086,840
2,025 5.375%, 12/01/16 - FSA Insured 12/12 at 101.00 AAA 2,226,933
715 Lee County, North Carolina, Certificates of Participation, 4/14 at 100.00 AAA 778,170
Public Schools and Community College, Series 2004,
5.250%, 4/01/20 - FSA Insured
1,380 Pasquotank County, North Carolina, Certificates of Participation, 6/14 at 100.00 AAA 1,468,223
Series 2004, 5.000%, 6/01/25 - MBIA Insured
2,070 Pitt County, North Carolina, Certificates of Participation, 4/14 at 100.00 AAA 2,195,649
School Facilities Project, Series 2004B, 5.000%, 4/01/29 -
AMBAC Insured
1,270 Puerto Rico Infrastructure Financing Authority, Special Tax No Opt. Call AAA 1,462,443
Revenue Bonds, Series 2005C, 5.500%, 7/01/16 -
AMBAC Insured
Raleigh, North Carolina, Certificates of Participation,
Downtown Improvement Project, Series 2004B:
805 5.000%, 6/01/20 6/14 at 100.00 AA+ 859,692
1,310 5.000%, 6/01/21 6/14 at 100.00 AA+ 1,395,504
1,000 Randolph County, North Carolina, Certificates of Participation, 6/14 at 102.00 AAA 1,086,950
Series 2004, 5.000%, 6/01/20 - FSA Insured
1,150 Sampson County, North Carolina, Certificates of Participation, 6/17 at 100.00 AAA 1,239,643
Series 2006, 5.000%, 6/01/34 - FSA Insured (UB)
------------------------------------------------------------------------------------------------------------------------------------
16,355 Total Tax Obligation/Limited 17,692,021
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 16.7% (10.9% OF TOTAL INVESTMENTS)
2,035 Charlotte, North Carolina, Airport Revenue Bonds, Series 2004A, 7/14 at 100.00 AAA 2,160,804
5.000%, 7/01/34 - MBIA Insured
590 Piedmont Triad Airport Authority, North Carolina, Airport 7/15 at 100.00 AAA 638,516
Revenue Bonds, Series 2005A, 5.000%, 7/01/20 -
XLCA Insured
Raleigh Durham Airport Authority, North Carolina, Airport
Revenue Bonds, Series 2001A:
1,000 5.250%, 11/01/15 - FGIC Insured 5/11 at 101.00 Aaa 1,068,180
2,320 5.250%, 11/01/16 - FGIC Insured 5/11 at 101.00 Aaa 2,474,257
2,230 5.250%, 11/01/17 - FGIC Insured 5/11 at 101.00 Aaa 2,392,879
University of North Carolina, Charlotte, Parking System
Revenue Bonds, Series 2002:
270 5.000%, 1/01/20 - MBIA Insured 1/12 at 101.00 Aaa 288,824
500 5.125%, 1/01/27 - MBIA Insured 1/12 at 101.00 Aaa 532,580
------------------------------------------------------------------------------------------------------------------------------------
8,945 Total Transportation 9,556,040
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 19.9% (13.0% OF TOTAL INVESTMENTS) (4)
North Carolina Capital Facilities Financing Agency, Revenue
Bonds, Duke University, Series 2001A:
3,035 5.125%, 10/01/26 (Pre-refunded 10/01/11) 10/11 at 100.00 Aaa 3,249,028
1,620 5.125%, 10/01/41 (Pre-refunded 10/01/11) 10/11 at 100.00 Aaa 1,734,242
Raleigh, North Carolina, Combined Enterprise System Revenue
Bonds, Series 2004:
1,000 5.000%, 3/01/21 (Pre-refunded 3/01/14) 3/14 at 100.00 AAA 1,091,610
1,750 5.000%, 3/01/22 (Pre-refunded 3/01/14) 3/14 at 100.00 AAA 1,910,318
3,200 Wake County, North Carolina, General Obligation School Bonds, 2/10 at 101.50 AAA 3,423,230
Series 2000, 5.400%, 2/01/13 (Pre-refunded 2/01/10)
------------------------------------------------------------------------------------------------------------------------------------
10,605 Total U.S. Guaranteed 11,408,428
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 13.5% (8.8% OF TOTAL INVESTMENTS)
500 North Carolina Eastern Municipal Power Agency, Power System 1/16 at 100.00 AAA 553,830
Revenue Bonds, Series 2005, 5.250%, 1/01/20 -
AMBAC Insured
2,500 North Carolina Eastern Municipal Power Agency, Power 1/07 at 100.00 AAA 2,503,725
System Revenue Refunding Bonds, Series 1993B,
5.500%, 1/01/17 - FGIC Insured
1,500 North Carolina Municipal Power Agency 1, Catawba Electric 1/10 at 101.00 A3 1,630,410
Revenue Bonds, Series 1999B, 6.500%, 1/01/20
37
Nuveen North Carolina Dividend Advantage Municipal Fund 2 (NNO) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES (continued)
$ 250 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/15 at 100.00 AAA $ 271,127
Series 2005RR, 5.000%, 7/01/24 - FGIC Insured
2,600 Wake County Industrial Facilities and Pollution Control 2/12 at 101.00 A3 2,775,812
Financing Authority, North Carolina, Revenue Refunding
Bonds, Carolina Power and Light Company, Series 2002,
5.375%, 2/01/17
------------------------------------------------------------------------------------------------------------------------------------
7,350 Total Utilities 7,734,904
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 16.3% (10.7% OF TOTAL INVESTMENTS)
2,520 Charlotte, North Carolina, Water and Sewerage System No Opt. Call AAA 2,774,999
Revenue Bonds, Series 2002A, 5.250%, 7/01/13
1,000 Durham County, North Carolina, Enterprise System Revenue 6/13 at 100.00 AAA 1,065,010
Bonds, Series 2002, 5.000%, 6/01/23 - MBIA Insured
Raleigh, North Carolina, Combined Enterprise System Revenue
Bonds, Series 2006A:
3,095 5.000%, 3/01/31 (UB) 3/16 at 100.00 AAA 3,345,881
1,000 5.000%, 3/01/36 (UB) 3/16 at 100.00 AAA 1,077,845
1,000 Wilmington, North Carolina, Water and Sewer Revenue Bonds, 6/15 at 100.00 AAA 1,078,580
Series 2005, 5.000%, 6/01/25 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
8,615 Total Water and Sewer 9,342,315
------------------------------------------------------------------------------------------------------------------------------------
$ 82,025 Total Investments (cost $83,725,464) - 153.2% 87,713,603
=============-----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (6.1)% (3,465,000)
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 1,007,807
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.9)% (28,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 57,256,410
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
N/R Not rated.
(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.
38
Nuveen North Carolina Dividend Advantage Municipal Fund 3 (NII)
Portfolio of
INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 3.6% (2.2% OF TOTAL INVESTMENTS)
$ 2,000 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB $ 2,101,220
Asset-Backed Refunding Bonds, Series 2002, 5.500%, 5/15/39
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 11.5% (7.5% OF TOTAL INVESTMENTS)
North Carolina Capital Facilities Financing Agency, Revenue
Bonds, Duke University, Series 2001A:
330 5.125%, 10/01/26 10/11 at 100.00 AA+ 347,493
95 5.125%, 10/01/41 10/11 at 100.00 AA+ 100,036
3,000 North Carolina Capital Facilities Financing Agency, Revenue 10/12 at 100.00 AA+ 3,167,100
Bonds, Duke University, Series 2002A, 5.125%, 7/01/42
1,900 University of North Carolina System, Pooled Revenue 10/12 at 100.00 AAA 2,009,060
Refunding Bonds, Series 2002A, 5.000%, 4/01/27 -
AMBAC Insured
University of North Carolina Wilmington, Certificates of
Participation, Student Housing Project Revenue Bonds,
Series 2006:
500 5.000%, 6/01/21 - FGIC Insured 6/16 at 100.00 AAA 542,705
500 5.000%, 6/01/37 - FGIC Insured 6/16 at 100.00 AAA 535,730
------------------------------------------------------------------------------------------------------------------------------------
6,325 Total Education and Civic Organizations 6,702,124
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 13.7% (8.8% OF TOTAL INVESTMENTS)
750 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/11 at 101.00 AA 780,353
Healthcare System Revenue Bonds, Carolinas Healthcare
System, Series 2001A, 5.000%, 1/15/31
2,000 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/07 at 102.00 AA 2,042,480
Healthcare System Revenue Bonds, DBA Carolina Healthcare
System, Series 1997A, 5.125%, 1/15/22
200 Charlotte-Mecklenburg Hospital Authority, North Carolina, 1/15 at 100.00 AA 210,698
Healthcare System Revenue Bonds, DBA Carolinas
Healthcare System, Series 2005A, 5.000%, 1/15/45
1,000 North Carolina Medical Care Commission, Health System 10/11 at 101.00 AA 1,059,280
Revenue Bonds, Mission St. Joseph's Health System,
Series 2001, 5.250%, 10/01/31
2,000 North Carolina Medical Care Commission, Healthcare Facilities 11/13 at 100.00 AA- 2,128,120
Revenue Bonds, Novant Health Obligated Group,
Series 2003A, 5.000%, 11/01/18
500 North Carolina Medical Care Commission, Revenue Bonds, 1/15 at 100.00 AAA 532,635
Blue Ridge Healthcare System, Series 2005, 5.000%, 1/01/33 -
FGIC Insured
500 North Carolina Medical Care Commission, Revenue Bonds, 11/14 at 100.00 AA 529,630
Northeast Medical Center, Series 2004, 5.000%, 11/01/24
190 North Carolina Medical Care Commission, Revenue Bonds, 1/16 at 100.00 N/R 199,109
Pines at Davidson, Series 2006A, 5.000%, 1/01/36
430 Onslow County Hospital Authority, North Carolina, FHA Insured 10/16 at 100.00 AAA 461,584
Mortgage Revenue Bonds, Onslow Memorial Hospital
Project, Series 2006, 5.000%, 4/01/31 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
7,570 Total Health Care 7,943,889
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 1.8% (1.2% OF TOTAL INVESTMENTS)
1,000 Mecklenburg County, North Carolina, FNMA Multifamily 7/13 at 105.00 AAA 1,056,480
Housing Revenue Bonds, Little Rock Apartments, Series 2003,
5.150%, 1/01/22 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 2.6% (1.7% OF TOTAL INVESTMENTS)
975 North Carolina Housing Finance Agency, Home Ownership 7/09 at 100.00 AA 996,060
Revenue Bonds, 1998 Trust Agreement, Series 5A,
5.625%, 7/01/30 (Alternative Minimum Tax)
510 North Carolina Housing Finance Agency, Home Ownership 7/16 at 100.00 AA 520,583
Revenue Bonds, Series 25-A, 4.900%, 7/01/37 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,485 Total Housing/Single Family 1,516,643
------------------------------------------------------------------------------------------------------------------------------------
39
Nuveen North Carolina Dividend Advantage Municipal Fund 3 (NII) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.5% (0.9% OF TOTAL INVESTMENTS)
$ 800 North Carolina Capital Facilities Financing Agency, Exempt No Opt. Call BBB $ 798,120
Facilities Revenue Bonds, Waste Management Inc.,
Series 2001, 3.750%, 8/01/14 (Mandatory put 8/01/07)
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 1.5% (1.0% OF TOTAL INVESTMENTS)
600 North Carolina Medical Care Commission, Health Care 10/16 at 100.00 N/R 619,362
Facilities Revenue Bonds, Presbyterian Homes, Series 2006B,
5.200%, 10/01/21
250 North Carolina Medical Care Commission, Healthcare Facilities 10/16 at 100.00 N/R 260,240
Revenue Bonds, Presbyterian Homes, Series 2006,
5.400%, 10/01/27
------------------------------------------------------------------------------------------------------------------------------------
850 Total Long-Term Care 879,602
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 18.2% (11.8% OF TOTAL INVESTMENTS)
3,900 Cary, North Carolina, General Obligation Water and Sewer 3/11 at 102.00 AAA 4,181,112
Bonds, Series 2001, 5.000%, 3/01/20
Lincoln County, North Carolina, General Obligation Bonds,
Series 2002A:
850 5.000%, 6/01/19 - FGIC Insured 6/12 at 101.00 AAA 915,688
900 5.000%, 6/01/20 - FGIC Insured 6/12 at 101.00 AAA 970,488
1,050 5.000%, 6/01/21 - FGIC Insured 6/12 at 101.00 AAA 1,120,571
500 North Carolina, General Obligation Bonds, Series 2004A, 3/14 at 100.00 AAA 539,175
5.000%, 3/01/22
2,000 Puerto Rico, General Obligation and Public Improvement No Opt. Call AAA 2,427,520
Refunding Bonds, Series 1997, 6.500%, 7/01/15 -
MBIA Insured
400 Raleigh, North Carolina, General Obligation Bonds, 6/12 at 100.00 AAA 424,652
Series 2002, 5.000%, 6/01/21
------------------------------------------------------------------------------------------------------------------------------------
9,600 Total Tax Obligation/General 10,579,206
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 28.5% (18.4% OF TOTAL INVESTMENTS)
1,800 Catawba County, North Carolina, Certificates of Participation, 6/14 at 100.00 Aaa 1,959,804
Series 2004, 5.250%, 6/01/22 - MBIA Insured
1,500 Centennial Authority, North Carolina, Hotel Tax Revenue Bonds, 9/07 at 102.00 AAA 1,545,225
Arena Project, Series 1997, 5.125%, 9/01/19 - FSA Insured
2,750 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 2,889,233
Governmental Facilities Projects, Series 2003G,
5.000%, 6/01/33
3,000 Dare County, North Carolina, Certificates of Participation, 12/12 at 100.00 AAA 3,175,110
Series 2002, 5.000%, 6/01/23 - AMBAC Insured
500 Lee County, North Carolina, Certificates of Participation, 4/14 at 100.00 AAA 544,175
Public Schools and Community College, Series 2004,
5.250%, 4/01/20 - FSA Insured
1,000 North Carolina, Certificates of Participation, Repair and 6/14 at 100.00 AA+ 1,067,940
Renovation Project, Series 2004B, 5.000%, 6/01/20
2,000 Rutherford County, North Carolina, Certificates of Participation, 9/12 at 101.00 AAA 2,153,480
Series 2002, 5.000%, 9/01/21 - AMBAC Insured
1,200 Sampson County, North Carolina, Certificates of Participation, 6/17 at 100.00 AAA 1,293,540
Series 2006, 5.000%, 6/01/34 - FSA Insured (UB)
1,785 Union County, North Carolina, Certificates of Participation, 6/13 at 101.00 AAA 1,932,637
Series 2003, 5.000%, 6/01/20 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
15,535 Total Tax Obligation/Limited 16,561,144
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 8.9% (5.8% OF TOTAL INVESTMENTS)
Raleigh Durham Airport Authority, North Carolina, Airport
Revenue Bonds, Series 2001A:
1,780 5.250%, 11/01/15 - FGIC Insured 5/11 at 101.00 Aaa 1,901,360
3,100 5.000%, 11/01/20 - FGIC Insured 5/11 at 101.00 Aaa 3,292,448
------------------------------------------------------------------------------------------------------------------------------------
4,880 Total Transportation 5,193,808
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 10.7% (6.9% OF TOTAL INVESTMENTS) (4)
500 Broad River Water Authority, North Carolina, Water System 6/10 at 101.00 Aaa 534,995
Revenue Bonds, Series 2000, 5.375%, 6/01/26 (Pre-refunded
6/01/10) - MBIA Insured
50 Cumberland County, North Carolina, Hospital Facility Revenue 10/09 at 101.00 A- (4) 52,731
Bonds, Cumberland County Hospital System Inc., Cape Fear
Valley Health System, Series 1999, 5.250%, 10/01/29
(Pre-refunded 10/01/09)
40
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
Forsyth County, North Carolina, Certificates of Participation,
Public Facilities and Equipment Project, Series 2002:
$ 1,325 5.125%, 1/01/16 (Pre-refunded 1/01/13) 1/13 at 101.00 AA+ (4) $ 1,449,365
770 5.250%, 1/01/19 (Pre-refunded 1/01/13) 1/13 at 101.00 AA+ (4) 847,500
1,235 5.250%, 1/01/23 (Pre-refunded 1/01/13) 1/13 at 101.00 AA+ (4) 1,359,303
North Carolina Capital Facilities Financing Agency, Revenue
Bonds, Duke University, Series 2001A:
1,420 5.125%, 10/01/26 (Pre-refunded 10/01/11) 10/11 at 100.00 Aaa 1,520,138
405 5.125%, 10/01/41 (Pre-refunded 10/01/11) 10/11 at 100.00 Aaa 433,561
------------------------------------------------------------------------------------------------------------------------------------
5,705 Total U.S. Guaranteed 6,197,593
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 15.4% (10.0% OF TOTAL INVESTMENTS)
500 North Carolina Eastern Municipal Power Agency, Power 1/16 at 100.00 AAA 553,830
System Revenue Bonds, Series 2005, 5.250%, 1/01/20 -
AMBAC Insured
4,000 North Carolina Eastern Municipal Power Agency, Power System 1/07 at 100.00 AAA 4,005,960
Revenue Refunding Bonds, Series 1993B, 5.500%, 1/01/17 -
FGIC Insured
2,665 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 AAA 2,895,736
Revenue Bonds, Series 2003A, 5.250%, 1/01/15 -
AMBAC Insured
1,400 Wake County Industrial Facilities and Pollution Control Financing 2/12 at 101.00 A3 1,494,668
Authority, North Carolina, Revenue Refunding Bonds,
Carolina Power and Light Company, Series 2002,
5.375%, 2/01/17
------------------------------------------------------------------------------------------------------------------------------------
8,565 Total Utilities 8,950,194
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 36.0% (23.3% OF TOTAL INVESTMENTS)
Charlotte, North Carolina, Water and Sewerage System
Revenue Bonds, Series 2001:
750 5.125%, 6/01/26 6/11 at 101.00 AAA 797,363
1,780 5.125%, 6/01/26 - FGIC Insured 6/11 at 101.00 AAA 1,892,549
300 Durham County, North Carolina, Enterprise System Revenue 6/13 at 100.00 AAA 322,806
Bonds, Series 2002, 5.000%, 6/01/18 - MBIA Insured
2,500 Kannapolis, North Carolina, Water and Sewerage System 2/12 at 101.00 AAA 2,657,625
Revenue Bonds, Series 2001B, 5.250%, 2/01/26 -
FSA Insured (Alternative Minimum Tax)
500 Onslow County, North Carolina, Combined Enterprise System 6/14 at 100.00 AAA 533,635
Revenue Bonds, Series 2004B, 5.000%, 6/01/23 - XLCA Insured
1,000 Orange Water and Sewerage Authority, North Carolina, 7/11 at 101.00 AA+ 1,050,350
Water and Sewerage System Revenue Bonds, Series 2001,
5.000%, 7/01/26
Raleigh, North Carolina, Combined Enterprise System Revenue
Bonds, Series 2006A:
5,000 5.000%, 3/01/31 (UB) 3/16 at 100.00 AAA 5,405,300
3,000 5.000%, 3/01/36 (UB) 3/16 at 100.00 AAA 3,233,535
4,715 Winston-Salem, North Carolina, Water and Sewerage System Revenue 6/12 at 100.00 AAA 5,026,093
Bonds, Series 2002A,
5.000%, 6/01/19
------------------------------------------------------------------------------------------------------------------------------------
19,545 Total Water and Sewer 20,919,256
------------------------------------------------------------------------------------------------------------------------------------
$ 83,860 Total Long-Term Investments (cost $85,918,581) - 153.9% 89,399,279
=============-----------------------------------------------------------------------------------------------------------------------
41
Nuveen North Carolina Dividend Advantage Municipal Fund 3 (NII) (continued)
Portfolio of INVESTMENTS November 30, 2006 (Unaudited)
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.8% (0.5% OF TOTAL INVESTMENTS)
$ 450 Puerto Rico Government Development Bank, Adjustable A-1 $ 450,000
Refunding Bonds, Variable Rate Demand Obligations,
Series 1985, 3.290%, 12/01/15 - MBIA Insured (5)
=============-----------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $450,000) 450,000
--------------------------------------------------------------------------------------------------------------------
Total Investments (cost $86,368,581) - 154.7% 89,849,279
--------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (10.6)% (6,145,000)
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 4.1% 2,365,679
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.2)% (28,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 58,069,958
====================================================================================================================
(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 or
Moody's rating. Ratings below BBB by Standard & Poor's
Group or Baa by Moody's Investor Service, Inc. are
considered to be below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which
ensure the timely payment of principal and interest.
Such investments are normally considered to be
equivalent to AAA rated securities.
(5) Investment has a maturity of more than one year, but
has variable rate and demand features which qualify it
as a short-term investment. The rate disclosed is that
in effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
N/R Not rated.
(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.
42
Statement of
ASSETS AND LIABILITIES November 30, 2006 (Unaudited)
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $78,976,911, $41,939,509,
and $94,779,264, respectively) $83,784,284 $44,132,770 $99,008,871
Cash -- -- --
Receivables:
Interest 1,439,204 658,531 1,604,955
Investments sold -- -- --
Other assets 8,327 534 845
------------------------------------------------------------------------------------------------------------------------------------
Total assets 85,231,815 44,791,835 100,614,671
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft 212,992 63,749 58,289
Floating rate obligations -- -- --
Unrealized depreciation on forward swaps -- -- --
Accrued expenses:
Management fees 44,117 14,099 25,878
Other 15,625 7,837 18,295
Preferred share dividends payable 19,082 4,451 11,571
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 291,816 90,136 114,033
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 27,800,000 15,000,000 33,000,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $57,139,999 $29,701,699 $67,500,638
====================================================================================================================================
Common shares outstanding 3,805,113 1,966,787 4,553,660
====================================================================================================================================
Net asset value per Common share outstanding
(net assets applicable to Common shares,
divided by Common shares outstanding) $ 15.02 $ 15.10 $ 14.82
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 38,051 $ 19,668 $ 45,537
Paid-in surplus 52,369,898 27,862,613 64,257,862
Undistributed (Over-distribution of) net investment income (8,661) 11,013 (154,428)
Accumulated net realized gain (loss) from investments
and derivative transactions (66,662) (384,856) (877,940)
Net unrealized appreciation (depreciation) of investments
and derivative transactions 4,807,373 2,193,261 4,229,607
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $57,139,999 $29,701,699 $67,500,638
====================================================================================================================================
Authorized shares:
Common Unlimited Unlimited Unlimited
Preferred Unlimited Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
43
Statement of
ASSETS AND LIABILITIES November 30, 2006 (Unaudited) (continued)
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $133,812,783, $53,839,981,
$83,725,464 and $86,368,581, respectively) $140,154,523 $56,182,939 $87,713,603 $89,849,279
Cash -- 21,357 -- --
Receivables:
Interest 2,423,613 868,974 1,353,464 1,384,841
Investments sold 1,073,520 5,000 -- 1,414,000
Other assets 9,338 3,150 1,673 800
------------------------------------------------------------------------------------------------------------------------------------
Total assets 143,660,994 57,081,420 89,068,740 92,648,920
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft 1,220,984 -- 310,985 386,880
Floating rate obligations 1,300,000 5,480,000 3,465,000 6,145,000
Unrealized depreciation on forward swaps -- 13,765 -- --
Accrued expenses:
Management fees 73,061 16,219 23,335 22,159
Other 22,232 17,210 5,336 22,776
Preferred share dividends payable 30,513 2,515 7,674 2,147
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 2,646,790 5,529,709 3,812,330 6,578,962
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 46,800,000 17,000,000 28,000,000 28,000,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 94,214,204 $34,551,711 $57,256,410 $58,069,958
====================================================================================================================================
Common shares outstanding 6,351,838 2,258,169 3,747,848 3,930,437
====================================================================================================================================
Net asset value per Common share outstanding
(net assets applicable to Common shares,
divided by Common shares outstanding) $ 14.83 $ 15.30 $ 15.28 $ 14.77
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 63,518 $ 22,582 $ 37,478 $ 39,304
Paid-in surplus 87,829,648 32,015,971 53,168,038 55,461,517
Undistributed (Over-distribution of) net investment income (123,735) 46,701 (158,523) (114,421)
Accumulated net realized gain (loss) from investments
and derivative transactions 103,033 137,264 221,278 (797,140)
Net unrealized appreciation (depreciation) of investments
and derivative transactions 6,341,740 2,329,193 3,988,139 3,480,698
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 94,214,204 $34,551,711 $57,256,410 $58,069,958
====================================================================================================================================
Authorized shares:
Common Unlimited Unlimited Unlimited Unlimited
Preferred Unlimited Unlimited Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
44
Statement of
OPERATIONS Six Months Ended November 30, 2006 (Unaudited)
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $1,995,193 $1,036,067 $2,273,180
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 267,037 141,052 315,284
Preferred shares - auction fees 34,845 18,801 41,363
Preferred shares - dividend disbursing agent fees 5,014 5,014 5,014
Shareholders' servicing agent fees and expenses 2,538 157 328
Interest expense and fees -- -- --
Custodian's fees and expenses 16,102 8,234 19,887
Trustees' fees and expenses 1,068 551 1,203
Professional fees 6,139 5,589 6,515
Shareholders' reports - printing and mailing expenses 8,104 4,291 8,339
Stock exchange listing fees 162 84 194
Investor relations expense 5,707 2,904 6,219
Other expenses 6,125 6,698 6,856
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 352,841 193,375 411,202
Custodian fee credit (4,765) (2,897) (3,641)
Expense reimbursement -- (62,740) (158,452)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 348,076 127,738 249,109
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 1,647,117 908,329 2,024,071
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments (75) (50,209) 47,907
Net realized gain (loss) from futures -- -- --
Net realized gain (loss) from forward swaps -- -- 46,944
Change in net unrealized appreciation (depreciation) of investments 1,872,364 910,105 2,623,732
Change in net unrealized appreciation (depreciation) of forward swaps -- -- (197,717)
------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 1,872,289 859,896 2,520,866
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (429,496) (247,999) (531,818)
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from
distributions to Preferred shareholders (429,496) (247,999) (531,818)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares
from operations $3,089,910 $1,520,226 $4,013,119
====================================================================================================================================
See accompanying notes to financial statements.
45
Statement of
OPERATIONS Six Months Ended November 30, 2006 (Unaudited) (continued)
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $3,278,288 $1,242,468 $1,954,853 $1,985,014
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 442,182 162,110 267,535 270,233
Preferred shares - auction fees 58,661 21,309 35,096 35,096
Preferred shares - dividend disbursing agent fees 5,014 5,014 5,014 5,014
Shareholders' servicing agent fees and expenses 5,047 133 327 363
Interest expense and fees 132 26,163 14,138 27,915
Custodian's fees and expenses 18,769 10,406 14,326 16,406
Trustees' fees and expenses 2,078 668 980 1,214
Professional fees 7,246 5,653 6,225 6,276
Shareholders' reports - printing and mailing expenses 11,850 5,132 8,142 8,814
Stock exchange listing fees 4,947 96 160 168
Investor relations expense 9,690 3,396 5,496 5,708
Other expenses 7,942 7,343 7,582 6,618
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 573,558 247,423 365,021 383,825
Custodian fee credit (10,970) (4,443) (4,717) (4,133)
Expense reimbursement -- (63,649) (126,051) (135,810)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 562,588 179,331 234,253 243,882
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 2,715,700 1,063,137 1,720,600 1,741,132
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments 124,584 128,130 160,230 117,377
Net realized gain (loss) from futures -- 21,833 -- --
Net realized gain (loss) from forward swaps -- -- -- --
Change in net unrealized appreciation (depreciation) of investments 3,165,253 909,104 1,883,275 1,869,977
Change in net unrealized appreciation (depreciation) of forward swaps -- (13,765) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 3,289,837 1,045,302 2,043,505 1,987,354
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (740,451) (249,198) (448,722) (432,518)
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from
distributions to Preferred shareholders (740,451) (249,198) (448,722) (432,518)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to Common shares
from operations $5,265,086 $1,859,241 $3,315,383 $3,295,968
====================================================================================================================================
See accompanying notes to financial statements.
46
Statement of
CHANGES IN NET ASSETS (Unaudited)
GEORGIA GEORGIA GEORGIA
PREMIUM INCOME (NPG) DIVIDEND ADVANTAGE (NZX) DIVIDEND ADVANTAGE 2 (NKG)
---------------------------- ---------------------------- ----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 1,647,117 $ 3,319,942 $ 908,329 $ 1,845,409 $ 2,024,071 $ 4,021,017
Net realized gain (loss) from
investments (75) 463,246 (50,209) 15,105 47,907 (56,044)
Net realized gain (loss) from futures -- -- -- -- -- --
Net realized gain (loss) from
forward swaps -- -- -- (19,734) 46,944 (13,236)
Change in net unrealized
appreciation (depreciation)
of investments 1,872,364 (2,358,498) 910,105 (994,754) 2,623,732 (2,417,797)
Change in net unrealized appreciation
(depreciation) of forward swaps -- -- -- 67,410 (197,717) 436,491
Distributions to
Preferred Shareholders:
From net investment income (429,496) (645,442) (247,999) (368,644) (531,818) (859,541)
From accumulated net
realized gains -- (29,168) -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares
from operations 3,089,910 750,080 1,520,226 544,792 4,013,119 1,110,890
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (1,301,003) (2,967,320) (757,939) (1,699,327) (1,413,911) (3,183,008)
From accumulated net realized gains -- (251,264) -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (1,301,003) (3,218,584) (757,939) (1,699,327) (1,413,911) (3,183,008)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common Shares:
Offering costs adjustments -- -- -- -- -- --
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions 32,849 99,552 27,215 59,258 -- --
Preferred shares offering
costs adjustments -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares from
capital share transactions 32,849 99,552 27,215 59,258 -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 1,821,756 (2,368,952) 789,502 (1,095,277) 2,599,208 (2,072,118)
Net assets applicable to Common
shares at the beginning
of period 55,318,243 57,687,195 28,912,197 30,007,474 64,901,430 66,973,548
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $57,139,999 $55,318,243 $29,701,699 $28,912,197 $67,500,638 $64,901,430
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ (8,661) $ 74,721 $ 11,013 $ 108,622 $ (154,428) $ (232,770)
====================================================================================================================================
See accompanying notes to financial statements.
47
Statement of
CHANGES IN NET ASSETS (Unaudited) (continued)
NORTH CAROLINA NORTH CAROLINA
PREMIUM INCOME (NNC) DIVIDEND ADVANTAGE (NRB)
----------------------------- ----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 2,715,700 $ 5,594,531 $ 1,063,137 $ 2,130,270
Net realized gain (loss) from
investments 124,584 406,707 128,130 95,322
Net realized gain (loss) from futures -- -- 21,833 --
Net realized gain (loss) from
forward swaps -- -- -- --
Change in net unrealized appreciation
(depreciation) of investments 3,165,253 (4,033,853) 909,104 (1,195,026)
Change in net unrealized appreciation
(depreciation) of forward swaps -- -- (13,765) --
Distributions to Preferred Shareholders:
From net investment income (740,451) (1,024,654) (249,198) (384,276)
From accumulated net realized gains -- (136,337) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares
from operations 5,265,086 806,394 1,859,241 646,290
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (2,133,933) (4,996,624) (880,323) (1,984,988)
From accumulated net realized gains -- (1,010,708) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (2,133,933) (6,007,332) (880,323) (1,984,988)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common Shares:
Offering costs adjustments -- -- -- --
Net proceeds from Common shares
issued to shareholders due to
reinvestment of distributions 50,016 226,109 36,103 55,870
Preferred shares offering costs adjustments -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares from
capital share transactions 50,016 226,109 36,103 55,870
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 3,181,169 (4,974,829) 1,015,021 (1,282,828)
Net assets applicable to Common
shares at the beginning of period 91,033,035 96,007,864 33,536,690 34,819,518
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $94,214,204 $91,033,035 $34,551,711 $33,536,690
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ (123,735) $ 34,949 $ 46,701 $ 113,085
====================================================================================================================================
See accompanying notes to financial statements.
48
NORTH CAROLINA NORTH CAROLINA
DIVIDEND ADVANTAGE 2 (NNO) DIVIDEND ADVANTAGE 3 (NII)
----------------------------- ----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 1,720,600 $ 3,445,695 $ 1,741,132 $ 3,459,061
Net realized gain (loss) from
investments 160,230 144,400 117,377 11,352
Net realized gain (loss) from futures -- -- -- --
Net realized gain (loss) from
forward swaps -- (83,226) -- (165,393)
Change in net unrealized appreciation
(depreciation) of investments 1,883,275 (2,445,879) 1,869,977 (2,071,239)
Change in net unrealized appreciation
(depreciation) of forward swaps -- 172,011 -- 258,425
Distributions to Preferred Shareholders:
From net investment income (448,722) (652,732) (432,518) (695,922)
From accumulated net realized gains -- (46,077) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares
from operations 3,315,383 534,192 3,295,968 796,284
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (1,343,343) (3,076,672) (1,285,162) (2,840,173)
From accumulated net realized gains -- (463,738) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (1,343,343) (3,540,410) (1,285,162) (2,840,173)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common Shares:
Offering costs adjustments -- 6,568 -- --
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions 32,886 89,225 9,741 58,742
Preferred shares offering costs adjustments -- 6,694 -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares from
capital share transactions 32,886 102,487 9,741 58,742
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 2,004,926 (2,903,731) 2,020,547 (1,985,147)
Net assets applicable to Common
shares at the beginning of period 55,251,484 58,155,215 56,049,411 58,034,558
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $57,256,410 $55,251,484 $58,069,958 $56,049,411
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ (158,523) $ (87,058) $ (114,421) $ (137,873)
====================================================================================================================================
See accompanying notes to financial statements.
49
Notes to
FINANCIAL STATEMENTS (Unaudited)
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds (the "Funds") covered in this report and their corresponding Common
share stock exchange symbols are Nuveen Georgia Premium Income Municipal Fund
(NPG), Nuveen Georgia Dividend Advantage Municipal Fund (NZX), Nuveen Georgia
Dividend Advantage Municipal Fund 2 (NKG), Nuveen North Carolina Premium Income
Municipal Fund (NNC), Nuveen North Carolina Dividend Advantage Municipal Fund
(NRB), Nuveen North Carolina Dividend Advantage Municipal Fund 2 (NNO) and
Nuveen North Carolina Dividend Advantage Municipal Fund 3 (NII). Common shares
of Georgia Premium Income (NPG), Georgia Dividend Advantage (NZX), Georgia
Dividend Advantage 2 (NKG), North Carolina Dividend Advantage (NRB), North
Carolina Dividend Advantage 2 (NNO) and North Carolina Dividend Advantage 3
(NII) are traded on the American Stock Exchange while Common shares of North
Carolina Premium Income (NNC) are traded on the New York 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 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 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
a municipal bond, forward swap contract or futures contract, each Fund may use a
market price or fair market value quote provided by a major broker/dealer in
such investments. If it is determined that the market price or fair market value
for an investment is unavailable or inappropriate, the Board of Trustees of the
Funds, or its designee, may establish a fair value for the investment.
Exchange-listed securities are generally valued at the last sales price on the
securities exchange on which such securities are primarily traded. Securities
traded on a securities exchange for which there are no transactions on a given
day or securities not listed on a securities exchange are valued at the mean of
the closing bid and asked prices. Securities traded on Nasdaq are valued at the
Nasdaq Official Closing Price. Temporary investments in securities that have
variable rate and demand features qualifying them as short-term investments are
valued at amortized cost, which approximates market 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 or 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 November 30, 2006, 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.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all 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.
50
Dividends and Distributions to Common Shareholders
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders not less frequently than annually.
Furthermore, capital gains are distributed only to the extent they exceed
available capital loss carryforwards.
Distributions to Common shareholders of tax-exempt net investment income, net
realized capital gains and/or market discount, if any, are recorded on the
ex-dividend date. The amount and timing of distributions are determined in
accordance with federal income tax regulations, which may differ from U.S.
generally accepted accounting principles.
Preferred Shares
The Funds have issued and outstanding Preferred shares, $25,000 stated value per
share, as a means of effecting financial leverage. Each Fund's Preferred shares
are issued in one 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. The number of
Preferred shares outstanding for each Fund is as follows:
NORTH NORTH NORTH NORTH
GEORGIA GEORGIA GEORGIA CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPG) (NZX) (NKG) (NNC) (NRB) (NNO) (NII)
----------------------------------------------------------------------------------------------------------------
Number of shares:
Series M -- 600 -- -- -- -- --
Series T -- -- -- -- 680 -- --
Series W -- -- -- -- -- -- 1,120
Series TH 1,112 -- -- 1,872 -- -- --
Series F -- -- 1,320 -- -- 1,120 --
================================================================================================================
Inverse Floating Rate Securities
Each Fund may invest in inverse floating rate securities. An inverse floating
rate security is created by depositing a municipal bond, typically with a fixed
interest rate, into a special purpose trust created by a broker-dealer. In turn,
this trust (a) issues floating rate certificates, in face amounts equal to some
fraction of the deposited bond's par amount or market value, that typically pay
short-term tax-exempt interest rates to third parties, and (b) issues to a
long-term investor (such as one of the Funds) an inverse floating rate
certificate (sometimes referred to as an "inverse floater") that represents all
remaining or residual interest in the trust. The income received by the inverse
floater holder varies inversely with the short-term rate paid to the floating
rate certificates' holders, and in most circumstances the inverse floater holder
bears substantially all of the underlying bond's downside investment risk and
also benefits disproportionately from any potential appreciation of the
underlying bond's value. The price of an inverse floating rate security will be
more volatile than that of the underlying bond because the interest rate is
dependent on not only the fixed coupon rate of the underlying bond but also on
the short-term interest paid on the floating rate certificates, and because the
inverse floating rate security essentially bears the risk of loss of the greater
face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market
transaction without first owning the underlying bond (referred to as an
"externally-deposited inverse floater"), or instead by first selling a
fixed-rate bond to a broker-dealer for deposit into the special purpose trust
and receiving in turn the residual interest in the trust (referred to as a
"self-deposited inverse floater"). 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 (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 accounts for the related interest
paid to the holders of the short-term floating rate certificates as "Interest
expense and fees" in the Statement of Operations.
During the six months ended November 30, 2006, North Carolina Premium Income
(NNC), North Carolina Dividend Advantage (NRB), North Carolina Dividend
Advantage 2 (NNO) and North Carolina Dividend Advantage 3 (NII) invested in
externally deposited inverse floaters and/or self-deposited inverse floaters.
Georgia Premium Income (NPG), Georgia Dividend Advantage (NZX) and Georgia
Dividend Advantage 2 (NKG) did not invest in any such instruments during the six
months ended November 30, 2006.
The average floating rate obligations outstanding and average annual interest
rate related to self-deposited inverse floaters during the six months ended
November 30, 2006, were as follows:
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
--------------------------------------------------------------------------------------------------------
Average floating rate obligations $7,065 $1,365,299 $737,853 $1,456,793
Average annual interest rate 3.72% 3.80% 3.80% 3.80%
========================================================================================================
51
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
Forward Swap Transactions
The Funds are authorized to invest in certain derivative financial instruments.
The Funds' 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.
Futures Contracts
The Funds are 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 noted in the
Statement of Assets and Liabilities. Additionally, the Statement of Assets and
Liabilities reflects a receivable or payable for the variation margin when
applicable. As of November 30, 2006, there were no outstanding futures contracts
in any of the Funds.
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.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Funds' organizational documents, their Officers and 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.
52
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. FUND SHARES
Transactions in Common shares were as follows:
GEORGIA GEORGIA DIVIDEND GEORGIA DIVIDEND
PREMIUM INCOME (NPG) ADVANTAGE (NZX) ADVANTAGE 2 (NKG)
----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------
Common shares issued to shareholders
due to reinvestment of distributions 2,117 6,229 1,642 3,662 -- --
========================================================================================================================
NORTH CAROLINA NORTH CAROLINA
PREMIUM INCOME (NNC) DIVIDEND ADVANTAGE (NRB)
----------------------- ------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------
Common shares issued to shareholders
due to reinvestment of distributions 3,363 14,230 2,170 3,276
========================================================================================================================
NORTH CAROLINA NORTH CAROLINA
DIVIDEND DIVIDEND
ADVANTAGE 2 (NNO) ADVANTAGE 3 (NII)
----------------------- ------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
11/30/06 5/31/06 11/30/06 5/31/06
------------------------------------------------------------------------------------------------------------------------
Common shares issued to shareholders
due to reinvestment of distributions 2,166 5,637 672 3,940
========================================================================================================================
3. INVESTMENT TRANSACTIONS
Purchases and sales (including maturities but excluding short-term investments
and derivative transactions) during the six months ended November 30, 2006, were
as follows:
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
-----------------------------------------------------------------------------------------------------------
Purchases $ -- $ 269,868 $1,510,789
Sales and maturities 60,000 1,400,000 1,692,577
===========================================================================================================
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
-----------------------------------------------------------------------------------------------------------
Purchases $15,238,639 $ 9,921,999 $ 7,544,729 $11,732,278
Sales and maturities 12,268,508 4,541,106 4,019,125 7,661,478
===========================================================================================================
53
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
4. INCOME TAX INFORMATION
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to the treatment of paydown gains and losses, 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 November 30, 2006, the cost of investments was as follows:
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
-----------------------------------------------------------------------------------------------------------
Cost of investments $78,968,261 $42,021,148 $94,961,706
===========================================================================================================
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
-----------------------------------------------------------------------------------------------------------
Cost of investments $132,506,599 $48,360,866 $80,265,484 $80,276,767
===========================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at November 30, 2006, were as follows:
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
-----------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $4,816,023 $2,194,575 $4,292,899
Depreciation -- (82,953) (245,734)
-----------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation)
of investments $4,816,023 $2,111,622 $4,047,165
===========================================================================================================
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
-----------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $6,353,814 $2,345,941 $3,994,306 $3,482,674
Depreciation (3,290) (6,229) (1,880) (56,442)
-----------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation)
of investments $6,350,524 $2,339,712 $3,992,426 $3,426,232
===========================================================================================================
54
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at May 31, 2006, the Funds' last tax year end,
were as follows:
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
-----------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income * $317,681 $247,991 $26,687
Undistributed net ordinary income ** -- -- --
Undistributed net long-term capital gains 215 -- --
===========================================================================================================
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
-----------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income * $434,758 $270,616 $154,672 $104,660
Undistributed net ordinary income ** -- -- -- --
Undistributed net long-term capital gains -- -- 61,048 --
===========================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on May 1, 2006, paid on June 1, 2006.
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the Funds' last tax year ended
May 31, 2006, was designated for purposes of the dividends paid deduction as
follows:
GEORGIA GEORGIA GEORGIA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NPG) (NZX) (NKG)
-----------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $3,641,791 $2,072,610 $4,067,314
Distributions from net ordinary income ** 3,242 -- --
Distributions from net long-term capital gains 280,565 -- --
===========================================================================================================
NORTH NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NNC) (NRB) (NNO) (NII)
-----------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $6,057,580 $2,388,973 $3,738,500 $3,554,484
Distributions from net ordinary income ** 24,591 -- 123,149 --
Distributions from net long-term capital gains 1,146,601 -- 400,823 --
===========================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
At May 31, 2006, 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:
NORTH NORTH
GEORGIA GEORGIA CAROLINA CAROLINA
DIVIDEND DIVIDEND DIVIDEND DIVIDEND
ADVANTAGE ADVANTAGE 2 ADVANTAGE ADVANTAGE 3
(NZX) (NKG) (NRB) (NII)
------------------------------------------------------------------------------------------------------------
Expiration year:
2012 $ -- $138,103 $ -- $339,128
2013 52,813 177,608 7,645 36,008
2014 113,539 287,093 -- 474,910
------------------------------------------------------------------------------------------------------------
Total $166,352 $602,804 $7,645 $850,046
============================================================================================================
55
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
The following Funds elected to defer net realized losses from investments
incurred from November 1, 2005 through May 31, 2006 ("post-October losses") in
accordance with Federal income tax regulations. Post-October losses were treated
as having arisen on the first day of the current fiscal year:
NORTH NORTH
GEORGIA GEORGIA GEORGIA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND PREMIUM DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 INCOME ADVANTAGE 3
(NPG) (NZX) (NKG) (NNC) (NII)
----------------------------------------------------------------------------------------------------------
$66,877 $86,710 $186,814 $21,552 $10,007
==========================================================================================================
5. 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
Investments, Inc. ("Nuveen"), and a specific fund-level component, based only on
the amount of assets within each individual fund. This pricing structure enables
Nuveen 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:
AVERAGE DAILY NET ASSETS GEORGIA PREMIUM INCOME (NPG)
(INCLUDING NET ASSETS NORTH CAROLINA PREMIUM INCOME (NNC)
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
================================================================================
GEORGIA DIVIDEND ADVANTAGE (NZX)
GEORGIA DIVIDEND ADVANTAGE 2 (NKG)
NORTH CAROLINA DIVIDEND ADVANTAGE (NRB)
AVERAGE DAILY NET ASSETS NORTH CAROLINA DIVIDEND ADVANTAGE 2 (NNO)
(INCLUDING NET ASSETS NORTH CAROLINA DIVIDEND ADVANTAGE 3 (NII)
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
================================================================================
56
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 table below. As
of November 30, 2006, the complex-level fee rate was .1845%.
COMPLEX-LEVEL ASSETS(1) COMPLEX-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $55 billion .2000%
For the next $1 billion .1800
For the next $1 billion .1600
For the next $3 billion .1425
For the next $3 billion .1325
For the next $3 billion .1250
For the next $5 billion .1200
For the next $5 billion .1175
For the next $15 billion .1150
For Managed Assets over $91 billion (2) .1400
================================================================================
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate Managed Assets ("Managed Assets" means
the average daily net assets of each fund including assets attributable to
all types of leverage used by the Nuveen funds) of Nuveen-sponsored funds
in the U.S.
(2) With respect to the complex-wide Managed Assets over $91 billion, the fee
rate or rates that will apply to such assets will be determined at a later
date. In the unlikely event that complex-wide Managed Assets reach $91
billion prior to a determination of the complex-level fee rate or rates to
be applied to Managed Assets in excess of $91 billion, the complex-level
fee rate for such complex-wide Managed Assets shall be .1400% until such
time as a different rate or rates is determined.
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 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 Trustees has
adopted a deferred compensation plan for independent Trustees that enables
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 Georgia Dividend Advantage's (NZX) operations, the
Adviser has agreed to reimburse the Fund, as a percentage of average daily net
assets (including net assets attributable to Preferred shares), for fees and
expenses in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Georgia Dividend Advantage (NZX) for any
portion of its fees and expenses beyond September 30, 2011.
For the first eight years of Georgia Dividend Advantage 2's (NKG) and North
Carolina Dividend Advantage 3's (NII) operations, the Adviser has agreed to
reimburse the Funds, as a percentage of average daily net assets (including net
assets attributable to Preferred shares), for fees and expenses in the amounts
and for the time periods set forth below:
YEAR ENDING YEAR ENDING
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------------------------------------------------------
2002* .32% 2007 .32%
2003 .32 2008 .24
2004 .32 2009 .16
2005 .32 2010 .08
2006 .32
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Georgia Dividend Advantage 2 (NKG) and
North Carolina Dividend Advantage 3 (NII) for any portion of its fees and
expenses beyond September 30, 2010.
57
Notes to
FINANCIAL STATEMENTS (Unaudited) (continued)
For the first ten years of North Carolina Dividend Advantage's (NRB) operations,
the Adviser has agreed to reimburse the Fund, as a percentage of average daily
net assets (including net assets attributable to Preferred shares), for fees and
expenses in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
JANUARY 31, JANUARY 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 North Carolina Dividend Advantage (NRB)
for any portion of its fees and expenses beyond January 31, 2011.
For the first ten years of North Carolina Dividend Advantage 2's (NNO)
operations, the Adviser has agreed to reimburse the Fund, as a percentage of
average daily net assets (including net assets attributable to Preferred
shares), for fees and expenses in the amounts and for the time periods set forth
below:
YEAR ENDING YEAR ENDING
NOVEMBER 30, NOVEMBER 30,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse North Carolina Dividend Advantage 2
(NNO) for any portion of its fees and expenses beyond November 30, 2011.
6. NEW ACCOUNTING PRONOUNCEMENTS
Financial Accounting Standards Board Interpretation No. 48
On July 13, 2006, the Financial Accounting Standards Board (FASB) released 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 evaluation of tax positions taken or expected to be taken in the course of
preparing the Fund's tax returns to determine whether the tax positions are
"more-likely-than-not" of being sustained by the applicable tax authority. Tax
positions not deemed to meet the more-likely-than-not threshold would be
recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is
required for fiscal years beginning after December 15, 2006 and is to be applied
to all open tax years as of the effective date. At this time, management is
evaluating the implications of FIN 48 and does not expect the adoption of FIN 48
will have a significant impact on the net assets or results of operations of the
Funds.
58
Financial Accounting Standards Board Statement of Financial Accounting
Standards No. 157
In September 2006, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 157, "Fair Value
Measurements." This standard establishes a single authoritative definition of
fair value, sets out a framework for measuring fair value and requires
additional disclosures about fair value measurements. SFAS No. 157 applies to
fair value measurements already required or permitted by existing standards.
SFAS No. 157 is effective for financial statements issued for fiscal years
beginning after November 15, 2007 and interim periods within those fiscal years.
The changes to current generally accepted accounting principles from the
application of this standard relate to the definition of fair value, the methods
used to measure fair value, and the expanded disclosures about fair value
measurements. As of November 30, 2006, the Funds do not believe the adoption of
SFAS No. 157 will impact the financial statement amounts; however, additional
disclosures may be required about the inputs used to develop the measurements
and the effect of certain of the measurements included within the Statement of
Operations for the period.
7. 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 29, 2006, to shareholders of
record on December 15, 2006, as follows:
NORTH NORTH NORTH NORTH
GEORGIA GEORGIA GEORGIA CAROLINA CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND PREMIUM DIVIDEND DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2 INCOME ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPG) (NZX) (NKG) (NNC) (NRB) (NNO) (NII)
---------------------------------------------------------------------------------------------------------
Dividend per share $.0555 $.0625 $.0530 $.0545 $.0635 $.0580 $.0545
=========================================================================================================
At the same time, the following Funds declared capital gains and/or ordinary
income distributions as follows:
NORTH NORTH NORTH
CAROLINA CAROLINA CAROLINA
PREMIUM DIVIDEND DIVIDEND
INCOME ADVANTAGE ADVANTAGE 2
(NNC) (NRB) (NNO)
---------------------------------------------------------------------------------------------------------
Capital gains distributions per share $.0141 $.0520 $.0388
Ordinary income distributions per share* -- .0001 .0103
=========================================================================================================
* Ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
59
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
====================================================================================================================================
GEORGIA PREMIUM
INCOME (NPG)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) $14.55 $ .43 $ .49 $(.11) $ -- $ .81 $(.34) $ -- $(.34)
2006 15.19 .87 (.48) (.17) (.01) .21 (.78) (.07) (.85)
2005 14.42 .92 .84 (.09) -- 1.67 (.90) -- (.90)
2004 15.36 .97 (.96) (.05) -- (.04) (.90) -- (.90)
2003 14.31 .96 1.02 (.07) -- 1.91 (.86) -- (.86)
2002 14.15 1.02 .11 (.12) -- 1.01 (.85) -- (.85)
GEORGIA DIVIDEND
ADVANTAGE (NZX)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) 14.71 .46 .45 (.13) -- .78 (.39) -- (.39)
2006 15.30 .94 (.47) (.19) -- .28 (.87) -- (.87)
2005 14.47 .96 .85 (.10) -- 1.71 (.88) (.01) (.89)
2004 15.62 .97 (1.18) (.06) -- (.27) (.87) (.01) (.88)
2003 14.00 .96 1.65 (.06) (.02) 2.53 (.81) (.13) (.94)
2002(a) 14.33 .58 (.19) (.06) -- .33 (.47) -- (.47)
GEORGIA DIVIDEND
ADVANTAGE 2 (NKG)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) 14.25 .44 .56 (.12) -- .88 (.31) -- (.31)
2006 14.71 .88 (.45) (.19) -- .24 (.70) -- (.70)
2005 13.79 .87 .94 (.11) -- 1.70 (.78) -- (.78)
2004 15.01 .88 (1.23) (.05) -- (.40) (.80) (.02) (.82)
2003(b) 14.33 .47 .92 (.04) -- 1.35 (.47) -- (.47)
====================================================================================================================================
Total Returns
----------------------
Based
Offering on
Costs and Ending Common
Preferred Common Based Share
Share Share Ending on Net
Underwriting Net Asset Market Market Asset
Discounts Value Value Value** Value**
==========================================================================================
GEORGIA PREMIUM
INCOME (NPG)
------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) $ -- $15.02 $14.42 (2.69)% 5.65%
2006 -- 14.55 15.16 (4.12) 1.42
2005 -- 15.19 16.70 15.46 11.88
2004 -- 14.42 15.30 (4.56) (.23)
2003 -- 15.36 16.95 12.92 13.78
2002 -- 14.31 15.83 8.98 7.32
GEORGIA DIVIDEND
ADVANTAGE (NZX)
------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) -- 15.10 16.25 7.29 5.33
2006 -- 14.71 15.50 2.91 1.87
2005 .01 15.30 15.89 20.74 12.10
2004 -- 14.47 13.95 (5.15) (1.73)
2003 .03 15.62 15.59 12.56 18.82
2002(a) (.19) 14.00 14.74 1.42 1.02
GEORGIA DIVIDEND
ADVANTAGE 2 (NKG)
------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) -- 14.82 13.80 6.49 6.24
2006 -- 14.25 13.26 (1.61) 1.68
2005 -- 14.71 14.18 13.61 12.61
2004 -- 13.79 13.20 (6.57) (2.67)
2003(b) (.20) 15.01 14.98 3.16 8.22
==========================================================================================
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 Net Net Portfolio
to Common Investment Investment Turnover
Shares (000) Expenses++ Income++ Expenses++ Income++ Rate
=============================================================================================================
GEORGIA PREMIUM
INCOME (NPG)
-------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) $57,140 1.26%* 5.86%* 1.24%* 5.88%* 0%
2006 55,318 1.25 5.87 1.22 5.90 15
2005 57,687 1.25 6.15 1.23 6.17 18
2004 54,607 1.23 6.54 1.22 6.55 12
2003 58,050 1.29 6.53 1.26 6.55 22
2002 53,909 1.37 7.12 1.35 7.13 37
GEORGIA DIVIDEND
ADVANTAGE (NZX)
-------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) 29,702 1.32* 5.76* .87* 6.21* 1
2006 28,912 1.31 5.82 .85 6.28 5
2005 30,007 1.27 5.93 .80 6.39 12
2004 28,348 1.27 6.03 .81 6.49 5
2003 30,576 1.31 6.00 .83 6.49 48
2002(a) 27,381 1.37* 5.70* .92* 6.16* 60
GEORGIA DIVIDEND
ADVANTAGE 2 (NKG)
-------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(c) 67,501 1.25* 5.64* .76* 6.14* 2
2006 64,901 1.24 5.63 .75 6.12 7
2005 66,974 1.23 5.58 .74 6.07 5
2004 62,810 1.22 5.63 .73 6.12 12
2003(b) 68,325 1.16* 4.36* .69* 4.84* 17
=============================================================================================================
Preferred Shares at End of Period
----------------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
=================================================================
GEORGIA PREMIUM
INCOME (NPG)
-----------------------------------------------------------------
Year Ended 5/31:
2007(c) $27,800 $25,000 $76,385
2006 27,800 25,000 74,747
2005 27,800 25,000 76,877
2004 27,800 25,000 74,107
2003 27,800 25,000 77,203
2002 27,800 25,000 73,480
GEORGIA DIVIDEND
ADVANTAGE (NZX)
-----------------------------------------------------------------
Year Ended 5/31:
2007(c) 15,000 25,000 74,503
2006 15,000 25,000 73,187
2005 15,000 25,000 75,012
2004 15,000 25,000 72,247
2003 15,000 25,000 75,961
2002(a) 15,000 25,000 70,636
GEORGIA DIVIDEND
ADVANTAGE 2 (NKG)
-----------------------------------------------------------------
Year Ended 5/31:
2007(c) 33,000 25,000 76,137
2006 33,000 25,000 74,168
2005 33,000 25,000 75,738
2004 33,000 25,000 72,583
2003(b) 33,000 25,000 76,761
=================================================================
* Annualized.
** Total Return 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. Total Return 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. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) For the period September 25, 2001 (commencement of operations) through May
31, 2002.
(b) For the period September 25, 2002 (commencement of operations) through May
31, 2003.
(c) For the six months ended November 30, 2006.
See accompanying notes to financial statements.
60-61 spread
FINANCIAL HIGHLIGHTS (Unaudited) (continued)
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
---------------------------------------------------------------- ------------------------------------
Distributions Distributions
from Net from Net
Beginning Investment Capital Investment Capital
Common Net Income to Gains to Income to Gains to
Share Net Realized/ Preferred Preferred Common Common
Net Asset Investment Unrealized Share- Share- Share- Share-
Value Income Gain (Loss) holders+ holders+ Total holders holders Total
====================================================================================================================================
NORTH CAROLINA
PREMIUM INCOME (NNC)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) $14.34 $ .43 $ .52 $(.12) $ -- $ .83 $(.34) $ -- $(.34)
2006 15.16 .88 (.57) (.16) (.02) .13 (.79) (.16) (.95)
2005 14.55 .91 .70 (.11) -- 1.50 (.89) -- (.89)
2004 15.50 .95 (.95) (.06) -- (.06) (.89) -- (.89)
2003 14.18 .98 1.27 (.07) -- 2.18 (.86) -- (.86)
2002 13.94 1.02 .15 (.13) -- 1.04 (.80) -- (.80)
NORTH CAROLINA
DIVIDEND ADVANTAGE (NRB)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) 14.87 .47 .46 (.11) -- .82 (.39) -- (.39)
2006 15.46 .94 (.48) (.17) -- .29 (.88) -- (.88)
2005 14.72 .97 .78 (.09) -- 1.66 (.92) -- (.92)
2004 15.87 .98 (1.10) (.05) -- (.17) (.91) (.07) (.98)
2003 14.39 1.00 1.54 (.06) (.02) 2.46 (.86) (.13) (.99)
2002 13.90 1.06 .38 (.13) -- 1.31 (.82) -- (.82)
====================================================================================================================================
Total Returns
----------------------
Offering Based on
Costs and Ending Common
Preferred Common Based Share
Share Share Ending on Net
Underwriting Net Asset Market Market Asset
Discounts Value Value Value** Value**
===============================================================================================
NORTH CAROLINA
PREMIUM INCOME (NNC)
-----------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) $ -- $14.83 $14.68 (.47)% 5.83%
2006 -- 14.34 15.09 (6.84) .87
2005 -- 15.16 17.20 17.79 10.52
2004 -- 14.55 15.40 (4.08) (.40)
2003 -- 15.50 16.95 10.27 15.80
2002 -- 14.18 16.21 15.44 7.62
NORTH CAROLINA
DIVIDEND ADVANTAGE
(NRB)
-----------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) -- 15.30 15.69 (9.21) 5.59
2006 -- 14.87 17.70 8.03 1.93
2005 -- 15.46 17.25 21.19 11.53
2004 -- 14.72 15.05 (2.76) (1.08)
2003 .01 15.87 16.45 13.52 17.75
2002 -- 14.39 15.44 7.54 9.58
===============================================================================================
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
====================================================================================================================================
NORTH CAROLINA
PREMIUM INCOME
(NNC)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) $94,214 1.24%* 1.24%* 5.86%* 1.22%* 1.22%* 5.89%* 9%
2006 91,033 1.25 1.25 5.98 1.24 1.24 5.99 16
2005 96,008 1.23 1.23 6.09 1.22 1.22 6.10 19
2004 91,941 1.23 1.23 6.35 1.22 1.22 6.36 20
2003 97,785 1.27 1.27 6.60 1.25 1.25 6.62 16
2002 89,286 1.33 1.33 7.17 1.32 1.32 7.18 22
NORTH CAROLINA
DIVIDEND
ADVANTAGE
(NRB)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) 34,552 1.46* 1.31* 5.87* 1.06* .90* 6.27* 9
2006 33,537 1.29 1.29 5.79 .84 .84 6.24 4
2005 34,820 1.27 1.27 5.90 .81 .81 6.35 11
2004 33,110 1.24 1.24 5.96 .78 .78 6.42 15
2003 35,591 1.30 1.30 6.16 .83 .83 6.62 39
2002 32,148 1.44 1.44 6.86 .90 .90 7.40 37
====================================================================================================================================
Floating Rate Obligations
Preferred Shares at End of Period at End of Period
--------------------------------------- -------------------------
Aggregate Liquidation Aggregate
Amount and Market Asset Amount Asset
Outstanding Value Coverage Outstanding Coverage
(000) Per Share Per Share (000) Per $1,000
================================================================================
NORTH CAROLINA
PREMIUM INCOME (NNC)
--------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) $46,800 $25,000 $75,328 $1,300 $109,472
2006 46,800 25,000 73,629 -- --
2005 46,800 25,000 76,286 -- --
2004 46,800 25,000 74,114 -- --
2003 46,800 25,000 77,236 -- --
2002 46,800 25,000 72,695 -- --
NORTH CAROLINA
DIVIDEND ADVANTAGE
(NRB)
--------------------------------------------------------------------------------
Year Ended 5/31:
2007(b) 17,000 25,000 75,811 5,480 10,407
2006 17,000 25,000 74,319 -- --
2005 17,000 25,000 76,205 -- --
2004 17,000 25,000 73,692 -- --
2003 17,000 25,000 77,340 -- --
2002 17,000 25,000 72,277 -- --
================================================================================
* Annualized.
** Total Return 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. Total Return 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. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) 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 November 30, 2006.
See accompanying notes to financial statements.
62-63 spread
FINANCIAL HIGHLIGHTS (Unaudited) (continued)
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
---------------------------------------------------------------- ------------------------------------
Distributions Distributions
from Net from Net
Beginning Investment Capital Investment Capital
Common Net Income to Gains to Income to Gains to
Share Net Realized/ Preferred Preferred Common Common
Net Asset Investment Unrealized Share- Share- Share- Share-
Value Income Gain (Loss) holders+ holders+ Total holders holders Total
====================================================================================================================================
NORTH CAROLINA
DIVIDEND
ADVANTAGE 2 (NNO)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) $14.75 $ .46 $ .55 $(.12) $ -- $ .89 $(.36) $ -- $(.36)
2006 15.55 .92 (.60) (.17) (.01) .14 (.82) (.12) (.94)
2005 14.81 .94 .83 (.10) -- 1.67 (.86) (.07) (.93)
2004 15.98 .94 (1.17) (.06) -- (.29) (.85) (.03) (.88)
2003 14.30 .94 1.78 (.07) (.02) 2.63 (.82) (.13) (.95)
2002(b) 14.33 .38 .11 (.04) -- .45 (.34) -- (.34)
NORTH CAROLINA
DIVIDEND
ADVANTAGE 3 (NII)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) 14.26 .44 .51 (.11) -- .84 (.33) -- (.33)
2006 14.78 .88 (.50) (.18) -- .20 (.72) -- (.72)
2005 13.89 .89 .91 (.11) -- 1.69 (.80) -- (.80)
2004 14.96 .90 (1.09) (.07) -- (.26) (.80) (.01) (.81)
2003(c) 14.33 .49 .87 (.05) -- 1.31 (.47) -- (.47)
====================================================================================================================================
Total Returns
----------------------
Offering Based on
Costs and Ending Common
Preferred Common Based Share
Share Share Ending on Net
Underwriting Net Asset Market Market Asset
Discounts Value Value Value** Value**
=======================================================================================
NORTH CAROLINA
DIVIDEND
ADVANTAGE 2 (NNO)
---------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) $ -- $15.28 $14.93 $ .05 $ 6.10
2006 -- 14.75 15.28 (.18) .97
2005 -- 15.55 16.25 16.46 11.56
2004 -- 14.81 14.80 (1.94) (1.83)
2003 -- 15.98 15.97 14.10 18.98
2002(b) (.14) 14.30 14.90 1.64 2.22
NORTH CAROLINA
DIVIDEND
ADVANTAGE 3 (NII)
---------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) -- 14.77 14.20 .73 5.94
2006 -- 14.26 14.42 (1.59) 1.41
2005 -- 14.78 15.40 18.78 12.39
2004 -- 13.89 13.68 (4.93) (1.75)
2003(c) (.21) 14.96 15.20 4.56 7.86
=======================================================================================
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
====================================================================================================================================
NORTH CAROLINA
DIVIDEND
ADVANTAGE 2 (NNO)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) $57,256 1.30%* 1.25%* 5.68%* .84%* .79%* 6.15%* 5%
2006 55,251 1.24 1.24 5.62 .77 .77 6.09 9
2005 58,155 1.23 1.23 5.64 .77 .77 6.10 26
2004 55,311 1.22 1.22 5.71 .77 .77 6.16 13
2003 59,642 1.24 1.24 5.80 .76 .76 6.27 22
2002(b) 53,383 1.19* 1.19* 4.70* .74* .74* 5.15* 43
NORTH CAROLINA
DIVIDEND
ADVANTAGE 3 (NII)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) 58,070 1.35* 1.25* 5.64* .86* .76* 6.13* 9
2006 56,049 1.23 1.23 5.58 .75 .75 6.07 2
2005 58,035 1.24 1.24 5.65 .76 .76 6.14 8
2004 54,482 1.22 1.22 5.75 .73 .73 6.23 14
2003(c) 58,653 1.18* 1.18* 4.61* .71* .71* 5.08* 3
====================================================================================================================================
Floating Rate Obligations
Preferred Shares at End of Period at End of Period
--------------------------------------- -------------------------
Aggregate Liquidation Aggregate
Amount and Market Asset Amount Asset
Outstanding Value Coverage Outstanding Coverage
(000) Per Share Per Share (000) Per $1,000
================================================================================
NORTH CAROLINA
DIVIDEND
ADVANTAGE 2 (NNO)
--------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) $28,000 $25,000 $76,122 $3,465 $25,605
2006 28,000 25,000 74,332 -- --
2005 28,000 25,000 76,924 -- --
2004 28,000 25,000 74,385 -- --
2003 28,000 25,000 78,252 -- --
2002(b) 28,000 25,000 72,664 -- --
NORTH CAROLINA
DIVIDEND
ADVANTAGE 3 (NII)
--------------------------------------------------------------------------------
Year Ended 5/31:
2007(d) 28,000 25,000 76,848 6,145 15,007
2006 28,000 25,000 75,044 -- --
2005 28,000 25,000 76,817 -- --
2004 28,000 25,000 73,644 -- --
2003(c) 28,000 25,000 77,369 -- --
================================================================================
* Annualized.
** Total Return 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. Total Return 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. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) 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 period November 15, 2001 (commencement of operations) through May
31, 2002.
(c) For the period September 25, 2002 (commencement of operations) through
May 31, 2003.
(d) For the six months ended November 30, 2006.
See accompanying notes to financial statements.
64-65 spread
Reinvest Automatically
EASILY AND CONVENIENTLY
Sidebar text: 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
then-current market price. If the shares are trading at less than net asset
value, shares for your account will be purchased on the open market. Dividends
and distributions received to purchase shares in the open market will normally
be invested shortly after the dividend payment date. No interest will be paid on
dividends and distributions awaiting reinvestment. Because the market price of
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.
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.
66
Automatic Dividend
REINVESTMENT PLAN
NOTICE OF AMENDMENT TO THE TERMS AND CONDITIONS
These Funds are amending the terms and conditions of their Automatic Dividend
Reinvestment Plan (the "Plan") as further described below effective with the
close of business on March 1, 2007. THESE CHANGES ARE INTENDED TO ENABLE PLAN
PARTICIPANTS UNDER CERTAIN CIRCUMSTANCES TO REINVEST FUND DISTRIBUTIONS AT A
LOWER AGGREGATE COST THAN IS POSSIBLE UNDER THE EXISTING PLAN. Shareholders who
do not wish to continue as participants under the amended Plan may withdraw from
the Plan by notifying the Plan Agent prior to the effective date of the
amendments. Participants should refer to their Plan document for notification
instructions, or may simply call Nuveen at (800) 257-8787.
Fund shareholders who elect to participate in the Plan are able to have Fund
distributions consisting of income dividends, realized capital gains and returns
of capital automatically reinvested in additional Fund shares. Under the Plan's
existing terms, the Plan Agent purchases Fund shares in the open market if the
Fund's shares are trading at a discount to their net asset value on the payable
date for the distribution. If the Fund's shares are trading at or above their
net asset value on the payable date for the distribution, the Plan Agent
purchases newly-issued Fund shares directly from the Fund at a price equal to
the greater of the shares' net asset value or 95% of the shares' market value.
Under the Plan's amended terms, 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. This change will permit Plan
participants under these circumstances to reinvest Fund distributions at a lower
aggregate cost than is possible under the existing Plan.
67
Notes
68
Notes
69
Notes
70
Other Useful
INFORMATION
QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
Each Fund's (i) quarterly portfolio of investments, (ii) information regarding
how the Funds voted proxies relating to portfolio securities held during the
12-month period ended June 30, 2006, and (iii) a description of the policies and
procedures that the Funds used to determine how to vote proxies relating to
portfolio securities are available 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 1-202-942-8090
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 450 Fifth Street NW, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
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.
GLOSSARY OF TERMS USED IN THIS REPORT
AVERAGE ANNUAL TOTAL RETURN: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time period. It
expresses the return 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 common share NAV per share is calculated by
subtracting the liabilities of the Fund (including any MuniPreferred shares
issued in order to leverage the Fund) from its total assets and then dividing
the remainder by the number of shares outstanding. Fund NAVs are calculated at
the end of each business day.
TAXABLE-EQUIVALENT YIELD: The yield necessary from a fully taxable investment to
equal, on an after-tax basis, the yield of a municipal bond investment.
BOARD OF TRUSTEES
Robert P. Bremner
Lawrence H. Brown
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Eugene S. Sunshine
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 shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were repurchased during the period covered by this report. Any future
repurchases will be reported to shareholders in the next annual or semiannual
report.
71
Nuveen Investments:
SERVING Investors
For GENERATIONS
Photo of: 2 women looking at a photo album.
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.
Managing more than $160 billion in assets, as of December 2006, Nuveen
Investments offers access to a number of different asset classes and investing
solutions through a variety of products. Nuveen Investments markets its
capabilities under four distinct brands: Nuveen, a leader in fixed-income
investments; NWQ, a leader in value-style equities; Rittenhouse, a leader in
growth-style equities; and Symphony, a leading institutional manager of
market-neutral alternative investment portfolios.
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.
o Share prices
Learn more o Fund details
about Nuveen Funds at o Daily financial news
WWW.NUVEEN.COM/CEF o Investor education
o Interactive planning tools
Logo: NUVEEN Investments
ESA-C-1106D
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.
Not applicable.
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: Ex-99.CERT
attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons: Not applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Nuveen North Carolina Dividend Advantage Municipal Fund 2
-----------------------------------------------------------
By (Signature and Title)* /s/ Jessica R. Droeger
----------------------------------------------
Jessica R. Droeger
Vice President and Secretary
Date: February 8, 2007
-------------------------------------------------------------------
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: February 8, 2007
-------------------------------------------------------------------
By (Signature and Title)* /s/ Stephen D. Foy
----------------------------------------------
Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: February 8, 2007
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.