Three Nuveen Closed-End Funds Reject New ARPS Demand Letters
November 05 2010 - 4:19PM
Business Wire
Nuveen Investments announced today that the Board of three
Nuveen leveraged closed-end funds that in recent weeks each
received a demand letter from a law firm on behalf of purported
holders of each fund’s common shares has rejected the demands
contained in those letters. The demand letters were similar to
letters previously received by other Nuveen closed-end funds and
alleged that Nuveen Asset Management (the fund’s Adviser) and the
fund’s officers and Board of directors breached their fiduciary
duties related to the redemption at par of the fund’s auction rate
preferred shares (ARPS). Similar to actions taken by the Board of
those other Nuveen closed-end funds regarding the previously
received demand letters, the Board of each of these three
closed-end funds rejected the demands contained in the new demand
letters after a review and recommendation by a committee of certain
of its disinterested and independent Board members. These three
funds are:
Nuveen Municipal Advantage Fund, Inc. (NMA)Nuveen Insured
Municipal Opportunity Fund, Inc. (NIO)Nuveen Quality Income
Municipal Fund, Inc. (NQU)
As previously announced on July 14, 2010, after an extensive
independent review, the Board of several Nuveen closed-end funds
rejected the demands contained in similar demand letters received
from the same law firm. In response to each of the demand letters,
the funds’ Board established a Demand Committee of certain of its
disinterested and independent Directors to investigate the claims
made in the demand letters and to report to the full Board its
findings and recommendation. The Demand Committee retained
independent counsel to assist it in conducting an extensive
investigation of the claims made in the demand letters. Based upon
its investigation, the Demand Committee found that it was not in
the best interests of the initial 30 funds or their shareholders to
take the actions suggested in the demand letters, and recommended
that the full Board reject the demands made in the demand letters.
The Demand Committee for the three funds named above, again
assisted by independent counsel, investigated the claims and came
to the same conclusion regarding the more recent letters received
by those funds. After reviewing the findings and recommendation of
the Demand Committee, the full Board for each of these three funds
unanimously adopted the Committee’s recommendation.
Nuveen Investments provides high quality investment services
designed to help secure the long-term goals of institutions and
high net worth investors as well as the consultants and financial
advisors who serve them. Nuveen Investments markets its growing
range of specialized investment solutions under the high-quality
brands of NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds, Winslow
Capital and Nuveen HydePark. In total, the Company managed more
than $160 billion as of September 30, 2010. For more information,
please visit the Nuveen Investments website at www.nuveen.com.
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