<PAGE>
NUVEEN
Money Market
Funds
August 31, 1997
Semiannual Report
Dependable, tax-free income
to help you keep more of
what you earn.
[PHOTO APPEARS HERE]
Tax-Exempt
<PAGE>
Contents
1 Dear Shareholder
3 Financial Section
20 Fund Information
<PAGE>
Dear Shareholder
[Photo of Timothy R. Schwertfeger appears here]
Timothy R. Schwertfeger
Chairman of the Board
Wealth takes a lifetime
to build. Once achieved,
it should be preserved.
It's a pleasure to report to you that the Nuveen Tax-Exempt Money Market Fund
has done well in generating tax-free income while preserving net asset value
stability and investor confidence. Also, the fund continued to deliver safety
and liquidity, which is especially comforting during periods of market
volatility.
During the past six months, the fund delivered attractive tax-free income from a
portfolio of quality municipal bonds. As of the end of August, investors were
receiving an annual tax-free yield of 3.14%, equivalent to a taxable yield of
4.55% for investors in the 31% federal income tax bracket.
Review of the Economy and Markets
Through the first eight months of 1997, stock and bond markets experienced
periodic short-term volatility. Positive news on the inflation front helped
soften the effects of a hike in short-term interest rates by the Federal Reserve
Board in late March. After tightening short-term interest rates by 0.25%, the
Federal Reserve demonstrated its confidence in the path the economy is taking by
maintaining the status quo at subsequent meetings in May and July.
In general, money market yields moved higher during the first part of the year
then declined toward the close of this reporting period as the economy showed
evidence of moderation and corporate earnings reports continued to exhibit
strength.
1
<PAGE>
"During the past six months,
the fund delivered
attractive tax-free income
from a portfolio of quality
municipal bonds."
Outlook
Despite today's tight labor market and rising wages, inflation has continued to
remain stagnant. Many economists and analysts attribute this to an increase in
business productivity, brought about by broader-based use of information
technology and the growth of the Internet. It is not clear, if or when, the
Federal Reserve will raise rates again. Accordingly, our strategy is to keep the
fund at or near its current maturity range and try to take advantage of any
interim volatility to purchase bonds with higher yields.
On behalf of everyone at Nuveen, I thank you for your confidence in us and our
family of investments. We will continue to strive to provide you with high-
quality investments that withstand the test of time. We look forward to
reporting to you again in six months.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
October 1, 1997
2
<PAGE>
Financial Section
Contents
4 Portfolio of Investments
12 Statement of Net Assets
13 Statement of Operations
14 Statement of Changes in Net Assets
15 Notes to Financial Statements
18 Financial Highlights
3
<PAGE>
Portfolio of Investments (Unaudited)
Nuveen Tax-Exempt Money Market Fund, Inc.
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Alabama -- 4.0%
$ 5,935,000 Boaz Industrial Development Board (Parker-Hannifin Corporation Project), Aa-2 $ 5,935,000
Variable Rate Demand Bonds, 3.400%, 9/01/12+
4,000,000 Marshall County Special Obligation, School Refunding Warrants, A-1+ 4,000,000
Series 1994, Variable Rate Demand Bonds, 3.400%, 2/01/12+
12,000,000 McIntosh Industrial Development Board, Pollution Control Revenue A-1+ 12,000,000
(Ciba-Geigy Corporation), Variable Rate Demand Bonds,
3.750%, 7/01/04+
- ---------------------------------------------------------------------------------------------------------------------------------
Alaska -- 1.5%
8,200,000 City of Valdez, Alaska, Marine Terminal Revenue Refunding Bonds VMIG-1 8,200,000
(Exxon Pipeline Company Project), 1993 Series C, Variable Rate
Demand Bonds, 3.750%, 12/01/33+
- ---------------------------------------------------------------------------------------------------------------------------------
Arizona -- 0.3%
1,600,000 Maricopa County, Arizona, Pollution Control Corporation, Pollution Control A-1+ 1,600,000
Revenue Refunding Bonds (Arizona Public Service Company
Palo Verde Project), 1994 Series C, Variable Rate Demand Bonds,
3.700%, 5/01/29+
- ---------------------------------------------------------------------------------------------------------------------------------
Arkansas -- 0.8%
3,100,000 Arkansas Hospital Equipment Finance Authority (Washington Regional VMIG-1 3,100,000
Medical Center), Variable Rate Demand Bonds, 3.300%, 10/01/98+
1,185,000 Little Rock School District of Pulaski County, Arkansas, Tax and Revenue MIG-1 1,186,590
Anticipation Promissory Notes, Series 1997, 4.250%, 12/30/97
- ---------------------------------------------------------------------------------------------------------------------------------
Colorado -- 1.1%
6,000,000 Pitkin County Industrial Development Revenue Refunding Bonds A-1+ 6,000,000
(Aspen Skiing Company Project), Series 1994A, Variable Rate
Demand Bonds, 3.600%, 4/01/16+
- ---------------------------------------------------------------------------------------------------------------------------------
Connecticut -- 2.7%
15,000,000 Connecticut State Special Assessment Unemployment Compensation VMIG-1 15,000,000
Advance Fund Revenue Bonds, Series 1993C, Commercial Paper,
3.900%, 7/01/98
- ---------------------------------------------------------------------------------------------------------------------------------
District of Columbia -- 4.2%
6,900,000 District of Columbia General Obligation, Variable Rate Demand Bonds, VMIG-1 6,900,000
Series 1992A-3, 3.800%, 10/01/07+
2,000,000 District of Columbia General Obligation, Series 1992A-6, Variable Rate VMIG-1 2,000,000
Demand Bonds, 3.800%, 10/01/07+
2,700,000 District of Columbia General Obligation, Variable Rate Demand Bonds, VMIG-1 2,700,000
3.800%, 10/01/07+
</TABLE>
4
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
District of Columbia -- continued
$ 8,100,000 District of Columbia General Obligation, Variable Rate Demand Bonds, VMIG-1 $ 8,100,000
Series 1992A-4, 3.800%, 10/01/07+
3,400,000 District of Columbia General Obligation, Series 1992A-2, Variable Rate VMIG-1 3,400,000
Demand Bonds, 3.800%, 10/01/07+
- ---------------------------------------------------------------------------------------------------------------------------------
Florida -- 5.6%
18,000,000 Florida Housing Finance Agency, Multi-Family Housing, 1985 Series D VMIG-1 18,000,000
(Kings Colony), Variable Rate Demand Bonds, 3.400%, 8/01/06+
7,000,000 Gulf Breeze, Series 1995 A (Florida Municipal Bond Fund), Variable Rate A-1 7,000,000
Demand Bonds, 3.350%, 3/31/21+
6,200,000 Miami Health Facilities Authority (Miami Jewish Home and Hospital Aa-3 6,200,000
for the Aged, Inc.), Series 1992, Variable Rate Demand Bonds,
3.400%, 3/01/12+
- ---------------------------------------------------------------------------------------------------------------------------------
Georgia -- 6.1%
8,250,000 Chatham County Tax Anticipation Notes, Series 1997, 4.100%, 12/31/97 N/R 8,257,934
7,215,000 Housing Authority of Clayton County, Tax-Exempt Adjustable Mode, Aa-2 7,215,000
Multi-Family Housing Revenue Refunding Bonds, Series 1996
(BS Partners LP Project), 3.400%, 9/01/26+
3,000,000 Columbia Elderly Authority, Residential Care Facilities Revenue Bonds Aa-3 3,000,000
(Augusta Resource Center on Aging Inc.), Variable Rate Demand Bonds,
3.400%, 1/01/21+
4,800,000 Housing Authority of the County of DeKalb, Georgia, Variable Rate A-1+ 4,800,000
Demand Bonds, Multi-Family Housing Revenue Bonds (Crow Wood
Arbor Associates, LTD. Project), Series 1985Q, 3.400%, 12/01/07+
10,705,000 Housing Authority of the County of DeKalb, Georgia, Multi-Family P-1 10,705,000
Housing Revenue Refunding Bonds (Lenox Pointe Project),
Series 1996A, Variable Rate Demand Bonds, 3.500%, 11/01/23+
- ---------------------------------------------------------------------------------------------------------------------------------
Illinois -- 3.7%
4,400,000 City of Chicago, Chicago--O'Hare International Airport, Special Facility P-1 4,400,000
Revenue Bonds (American Airlines, Inc. Project), Series 1983A,
Variable Rate Demand Bonds, 3.700%, 12/01/17+
6,800,000 Chicago--O'Hare International Airport (American Airlines), Variable Rate P-1 6,800,000
Demand Bonds, 3.700%, 12/01/17+
5,000,000 Decatur Water Revenue Bonds, Series 1985 (New South Water Treatment), VMIG-1 5,000,000
Commercial Paper, 3.650%, 10/23/97
4,300,000 Joliet Regional Port District, Marine Terminal Revenue Refunding Bonds A-1+ 4,300,000
(Exxon Project), 1989, Variable Rate Demand Bonds, 3.750%, 10/01/24+
</TABLE>
5
<PAGE>
Portfolio of Investments (Unaudited)
Nuveen Tax-Exempt Money Market Fund, Inc. -- continued
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Iowa -- 0.6%
$ 3,595,000 Iowa Higher Education Loan Authority, Private College Facility VMIG-1 $ 3,595,000
Revenue Bonds (Palmer Chiropractic University Foundation),
Series 1997, Variable Rate Demand Bonds, 3.850%, 4/01/27+
- ---------------------------------------------------------------------------------------------------------------------------------
Kansas -- 1.1%
6,000,000 Manhattan Industrial Development Board (Parker-Hannifin Corporation), Aa-2 6,000,000
Variable Rate Demand Bonds, 3.400%, 9/01/09+
- ---------------------------------------------------------------------------------------------------------------------------------
Kentucky -- 2.7%
15,000,000 Louisville and Jefferson County Metropolitan Sewer District, Sewer and SP-1 15,000,000
Drainage System Subordinated Revenue Notes, Series 1997A,
3.450%, 4/14/98
- ---------------------------------------------------------------------------------------------------------------------------------
Louisiana -- 1.3%
7,300,000 Louisiana Offshore Terminal Authority, Deepwater Port Refunding VMIG-1 7,300,000
Revenue Bonds (LOOP INC. Project), First Stage Series 1992A,
Variable Rate Demand Bonds, 3.750%, 9/01/08+
- ---------------------------------------------------------------------------------------------------------------------------------
Maryland -- 0.9%
5,000,000 Maryland Industrial Development (Baltimore International N/R 5,000,000
Culinary College), Variable Rate Demand Bonds, 3.350%, 5/01/24+
- ---------------------------------------------------------------------------------------------------------------------------------
Michigan -- 4.8%
3,400,000 The Economic Development Corporation of the County of Delta, Michigan, P-1 3,400,000
Environmental Improvement Revenue Refunding Bonds, 1985 Series D
(Mead-Escanaba Paper Company Project), Variable Rate
Demand Bonds, 3.650%, 12/01/23+
11,800,000 Detroit Downtown Development Authority (Millender Center Project), VMIG-1 11,800,000
Variable Rate Demand Bonds, 3.550%, 12/01/10+
7,000,000 The School District of the City of Kalamazoo, County of Kalamazoo, SP-1+ 7,012,681
State of Michigan 1997 State Aid Notes (Limited Tax
General Obligation), 4.000%, 4/15/98
4,100,000 The Economic Development Corporation of the County of Monroe, VMIG-1 4,100,000
State of Michigan, Adjustable Rate Demand Limited Obligation
Refunding Revenue Bonds (The Detroit Edison Company
Pollution Control Bonds Project), Series 1992-CC, 3.600%, 10/01/24+
</TABLE>
6
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Minnesota -- 2.3%
$ 5,000,000 Bloomington Port Authority, Tax Increment Revenue Refunding Bonds VMIG-1 $ 5,000,000
(Mall of America Project), Series 1995A, Variable Rate Demand Bonds,
3.400%, 2/01/13+
7,500,000 St. Paul Housing and Redevelopment Authority, Parking Revenue Bonds, VMIG-1 7,500,000
Series 1995B, Variable Rate Demand Bonds, 3.450%, 8/01/17+
- ---------------------------------------------------------------------------------------------------------------------------------
Missouri -- 5.5%
5,300,000 Health and Educational Facilities Authority of the State of Missouri, A-1+ 5,300,000
Health Facilities Revenue Bonds (St. Francis' Medical Center),
Series 1996A, Variable Rate Demand Bonds, 3.750%, 6/01/26+
2,300,000 Health and Educational Facilities Authority of the State of Missouri, VMIG-1 2,300,000
Health Facilities Revenue Bonds (Bethesda Barclay), Series 1996A,
Variable Rate Demand Bonds, 3.900%, 8/15/26+
2,600,000 Health and Educational Facilities Authority of the State of Missouri, VMIG-1 2,600,000
Educational Facilities, Adjustable Demand Revenue Bonds,
St. Louis University, Series 1985, Readily Adjustable Tax-Exempt
Securities, 3.800%, 12/01/05+
12,000,000 The City of St. Louis, Missouri, Tax and Revenue Anticipation Notes, MIG-1 12,062,126
Payable from the General Revenue Fund, Series 1997, 4.500%, 6/30/98
8,300,000 St. Louis Land Clearance Redevelopment Authority, Parking Facility VMIG-1 8,300,000
Revenue Refunding Bonds, Series 1996, Variable Rate Demand Bonds,
3.550%, 9/01/19+
- ---------------------------------------------------------------------------------------------------------------------------------
Nebraska -- 0.8%
4,430,000 Scotts Bluff County Hospital Authority, 1 Elderly Residential Facility-- A-1 4,430,000
GNMA (West Village), Variable Rate Demand Bonds,
3.550%, 12/01/31+
- ---------------------------------------------------------------------------------------------------------------------------------
New Mexico -- 0.7%
4,100,000 Farmington Pollution Control Revenue (Arizona Public Service Co. A-1+ 4,100,000
Four Corners Project), Variable Rate Demand Bonds, 3.700%, 5/01/24+
- ---------------------------------------------------------------------------------------------------------------------------------
New York -- 0.2%
1,000,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series B, VMIG-1 1,000,000
Variable Rate Demand Bonds, 3.750%, 8/15/22+
</TABLE>
7
<PAGE>
Portfolio of Investments (Unaudited)
Nuveen Tax-Exempt Money Market Fund, Inc. -- continued
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
North Carolina -- 1.2%
$ 4,100,000 North Carolina Eastern Municipal Power Agency, Power System Revenue, A-1+ $ 4,100,000
Series 1988B, Commercial Paper, 3.650%, 11/18/97
1,000,000 North Carolina Medical Care Commission, Hospital Revenue Bonds VMIG-1 1,000,000
(Duke University Hospital), Pooled Financing Project, Series 1991-A
(Adjustable Convertible Extendable Securities--Aces), Variable Rate
Demand Bonds, 3.800%, 10/01/20+
1,700,000 Raleigh-Durham Airport Authority, Special Facility Refunding Revenue A-1+ 1,700,000
Bonds (American Airlines, Inc. Project), Series 1995A-1, Variable Rate
Demand Bonds, 3.750%, 11/01/15+
- ---------------------------------------------------------------------------------------------------------------------------------
Ohio -- 5.9%
8,250,000 Chagrin Falls Exempt School District, School Improvement Voted N/R 8,275,843
Unlimited Tax Bond Anticipation Notes, 4.500%, 2/10/98
4,885,000 City School District of the City of Cincinnati, County of Hamilton, Ohio, Aaa 4,885,000
Tax Anticipation Notes, 1996 Series C, 3.750%, 12/01/97
3,000,000 Cuyahoga County, University Hospital of Cleveland, Series 1985, VMIG-1 3,000,000
Variable Rate Demand Bonds, 3.800%, 1/01/16+
5,000,000 County of Hamilton, Ohio, Variable Rate Hospital Facilities Revenue VMIG-1 5,000,000
Bonds, Series 1997A (Children's Hospital Medical Center),
3.350%, 5/15/17+
6,500,000 Hamilton County (Franciscan Sisters of the Poor), Variable Rate VMIG-1 6,500,000
Demand Bonds, 3.800%, 3/01/17+
5,000,000 County of Lucas, Ohio, Multi-Mode Facilities Improvement Revenue VMIG-1 5,000,000
Bonds, Series 1997 (The Toledo Zoological Society Project),
Variable Rate Demand Bonds, 3.600%, 10/01/05+
- ---------------------------------------------------------------------------------------------------------------------------------
Oklahoma -- 0.7%
4,000,000 Cushing Municipal Authority, Correctional Facility Revenue Bonds, VMIG-1 4,000,000
Series 1996, Variable Rate Demand Bonds, 3.400%, 11/01/17+
- ---------------------------------------------------------------------------------------------------------------------------------
Oregon -- 2.2%
12,000,000 Port of Morrow (Portland G.E. Company Boardman Project), VMIG-1 12,000,000
Variable Rate Demand Bonds, 3.800%, 10/01/13+
- ---------------------------------------------------------------------------------------------------------------------------------
Pennsylvania -- 6.9%
10,000,000 Port Authority of Allegheny County (Commonwealth of Pennsylvania), MIG-1 10,000,000
Grant Anticipation Notes, Series A of 1997, 3.850%, 6/30/98
4,000,000 Beaver County, Pennsylvania, Industrial Development Authority, VMIG-1 4,000,000
Pollution Control Revenue Refunding Bonds, Series 1990C
(Duquesne Light Company Beaver Valley), Commercial Paper,
3.750%, 10/30/97
</TABLE>
8
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Pennsylvania -- continued
$ 4,450,000 Chester County Industrial Development Authority, Variable Rate VMIG-1 $ 4,450,000
Revenue Bonds, Series of 1997, (Archdiocese of Philadelphia),
3.750%, 7/01/27+
3,210,000 Montgomery County Higher Education and Health Authority, VMIG-1 3,210,000
Series 1995 (Philadelphia Presbytery Homes, Inc.), Variable Rate
Demand Bonds, 3.450%, 7/01/25+
8,500,000 City of Philadelphia, Pennsylvania, General Obligation Bonds, VMIG-1 8,500,000
Series 1990, Commercial Paper, 3.800%, 11/30/98
2,000,000 City of Philadelphia Tax and Revenue Anticipation Notes, MIG-1 2,007,953
Series A of 1997-1998, 4.500%, 6/30/98
6,000,000 Schuylkill County Industrial Development Authority, Schuylkill County, A-1+ 6,000,000
Pennsylvania, Resource Recovery Refunding Revenue Bonds
(Northeastern Power Company Project), Series 1997A, Variable Rate
Demand Bonds, 3.750%, 12/01/22+
- ---------------------------------------------------------------------------------------------------------------------------------
South Dakota -- 2.2%
11,935,000 South Dakota Health and Education Facility (McKennan Hospital), VMIG-1 11,935,000
Series 1994, Variable Rate Demand Bonds, 3.400%, 7/01/14+
- ---------------------------------------------------------------------------------------------------------------------------------
Tennessee -- 4.9%
15,000,000 The Public Building Authority of the City of Clarksville, Tennessee, A-1+ 15,000,000
Adjustable Rate Pooled Financing Revenue Bonds, Series 1994
(Tennessee Municipal Bond Fund), 3.400%, 6/01/24+
4,175,000 Loudon Water and Sewer Revenue Refunding Bonds, Series 1996, Aa-2 4,175,000
Variable Rate Demand Bonds, 3.400%, 9/01/06+
8,000,000 The Public Building Authority of the County of Montgomery, Tennessee, P-1 8,000,000
Adjustable Rate Pooled Financing Revenue Bonds, Series 1996
(Montgomery County Loan), 3.400%, 7/01/19+
- ---------------------------------------------------------------------------------------------------------------------------------
Texas -- 4.6%
3,000,000 Texas Health Facilities Development Corporation (North Texas Pooled VMIG-1 3,000,000
Health Program), Variable Rate Demand Bonds, 3.450%, 5/31/25+
3,300,000 North Central Texas Health Facilities Development Corporation, A-1 3,300,000
Hospital Revenue Bonds, Series 1985-B (Methodist Hospitals
of Dallas), Variable Rate Demand Bonds, 3.750%, 10/01/15+
15,650,000 Sabine River Authority of Texas, Collateralized Pollution Control VMIG-1 15,650,000
Revenue Refunding Bonds (Texas Utilities Electric Company Project),
Series 1996A, Variable Rate Demand Bonds, 3.750%, 3/01/26+
</TABLE>
9
<PAGE>
Portfolio of Investments (Unaudited)
Nuveen Tax-Exempt Money Market Fund, Inc. -- continued
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Texas -- continued
$ 3,600,000 Southwest Higher Education Authority, Southern Methodist University, VMIG-1 $ 3,600,000
Variable Rate Demand Bonds, 3.750%, 7/01/15+
- ---------------------------------------------------------------------------------------------------------------------------------
Utah -- 5.8%
10,000,000 Utah County, Utah, Tax and Revenue Anticipation Notes, Series 1997, N/R 10,020,945
4.500%, 12/31/97
16,000,000 Emery County Pollution Control Revenue Refunding Bonds VMIG-1 16,000,000
(PacifiCorp Project), Series 1994, Variable Rate Demand Bonds,
3.750%, 11/01/24+
6,000,000 Weber County, Utah, Tax and Revenue Anticipation Notes, Series 1997A, MIG-1 6,008,888
4.250%, 12/31/97
- ---------------------------------------------------------------------------------------------------------------------------------
Washington -- 5.4%
7,000,000 Washington Health Care Facilities Authority, Weekly Rate Demand Aa-2 7,000,000
Revenue Bonds, Series 1997 (Sunnyside Community Hospital
Association, Sunnyside), 3.500%, 10/01/17+
10,745,000 Washington State Housing Finance Commission, Nonprofit Revenue A-1 10,745,000
Bonds (Emerald Heights Project), Series 1990, Variable Rate
Demand Bonds, 3.750%, 1/01/21+
3,150,000 Washington State Housing Finance Commission, Nonprofit Revenue VMIG-1 3,150,000
Bonds (Panorama City Project), 1997 Refunding Bonds, Variable Rate
Demand Bonds, 3.850%, 1/01/27+
9,000,000 Washington Student Loan Agency, Series 1984A, Variable Rate VMIG-1 9,000,000
Demand Bonds, 3.600%, 1/01/01+
- ---------------------------------------------------------------------------------------------------------------------------------
Wisconsin -- 4.0%
1,000,000 Wisconsin Health and Educational Facilities Authority, Variable Rate A-1 1,000,000
Revenue Bonds, Series 1996B (Riverview Hospital Association),
(Wisconsin Rapids, Wisconsin), 3.850%, 10/01/26+
4,000,000 Beaver Dam Unified School District, Dodge County, Wisconsin, MIG-1 4,000,875
Bond Anticipation Notes, 3.850%, 10/14/97
3,000,000 School District of Delavan--Darien, Rock and Walworth Counties, MIG-1 3,004,247
Wisconsin, Bond Anticipation Notes, 4.150%, 4/15/98
3,480,000 Germantown School District, Washington County, Wisconsin, MIG-1 3,484,317
Bond Anticipation Notes, 4.250%, 4/01/98
7,000,000 Madison Metropolitan School District, Tax and Revenue Anticipation N/R 7,008,173
Promissory Note, 4.000%, 2/24/98
3,805,000 River Falls Commercial Development, Revenue Refunding Aa-2 3,805,000
(Erdeco Partnership Project), Variable Rate Demand Bonds,
3.460%, 11/01/13+
</TABLE>
10
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
<TABLE>
<CAPTION>
Principal Amortized
Amount Description Ratings* Cost
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Wyoming -- 1.6%
$ 7,800,000 Sweetwater County, Wyoming, Pollution Control Revenue Bonds A-1+ $ 7,800,000
(PacifiCorp Project), Series 1984, Variable Rate Demand Bonds,
3.600%, 12/01/14+
1,200,000 Sweetwater County, Wyoming, Pollution Control Refunding Bonds VMIG-1 1,200,000
(Idaho Power Company Project), Series 1996C, Daily Interest Rate
Bonds, Variable Rate Demand Bonds, 3.750%, 7/15/26+
- ---------------------------------------------------------------------------------------------------------------------------------
$ 532,950,000 Total Investments -- 96.3% 533,115,572
=====================------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities -- 3.7% 20,316,765
-------------------------------------------------------------------------------------------------------
Net Assets -- 100% $ 553,432,337
=======================================================================================================
</TABLE>
* Ratings: Using the higher of Standard & Poor's
or Moody's rating.
N/R -- Investment is not rated.
+ The security has a maturity of more than one
year, but has variable rate and demand features
which qualify it as a short-term security. The
rate disclosed is that currently in effect.
This rate changes periodically based on market
conditions or a specified market index.
11
<PAGE>
Statement of Net Assets (Unaudited)
August 31, 1997
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
Assets
Investments in short-term municipal securities, at amortized
cost, which approximates market value (note 1) $533,115,572
Cash 18,372,929
Receivables:
Interest 3,168,003
Investment sold 500,000
Other assets 7,829
- --------------------------------------------------------------------------------
Total assets 555,164,333
- --------------------------------------------------------------------------------
Liabilities
Accrued expenses:
Management fees (note 3) 186,578
Other 83,450
Dividends payable 1,461,968
- --------------------------------------------------------------------------------
Total liabilities 1,731,996
- --------------------------------------------------------------------------------
Net assets applicable to shares outstanding (note 4) $553,432,337
================================================================================
Shares outstanding 553,432,337
================================================================================
Net asset value, offering and redemption price per share
(net assets divided by shares outstanding) $ 1.00
================================================================================
</TABLE>
12 See accompanying notes to financial statements.
<PAGE>
Statement of Operations (Unaudited) Nuveen Tax-Exempt Money Market Fund, Inc.
Six months ended August 31, 1997 August 31, 1997 Semiannual Report
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
Investment income
Tax-exempt interest income (note 1) $9,405,312
- --------------------------------------------------------------------------------
Expenses
Management fees (note 3) 1,014,040
Shareholders' servicing agent fees and expenses 9,562
Custodian's fees and expenses 33,608
Directors' fees and expenses (note 3) 3,672
Professional fees 10,042
Shareholders' reports-printing and mailing expenses 18,490
Federal and state registration fees 18,213
Other expenses 15,943
- --------------------------------------------------------------------------------
Total expenses 1,123,570
- --------------------------------------------------------------------------------
Net investment income 8,281,742
Net realized gain from investment transactions (notes 1 and 2) --
- --------------------------------------------------------------------------------
Net increase in net assets from operations $8,281,742
================================================================================
</TABLE>
13 See accompanying notes to financial statements.
<PAGE>
Statement of Changes in Net Assets (Unaudited)
<TABLE>
<CAPTION>
Six months ended Year ended
8/31/97 2/28/97
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment income $ 8,281,742 $ 16,624,557
Net realized gain from investment transactions
(notes 1 and 2) -- 21,201
- ----------------------------------------------------------------------------------------------
Net increase in net assets from operations 8,281,742 16,645,758
- ----------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1) (8,281,742) (16,645,758)
- ----------------------------------------------------------------------------------------------
Share Transactions
(at constant net asset value of $1 per share) (note 1)
Net proceeds from sale of shares 1,037,832,576 2,793,785,234
Net proceeds from shares issued to shareholders due to
reinvestment of distributions 3,230,740 6,431,423
- ----------------------------------------------------------------------------------------------
1,041,063,316 2,800,216,657
- ----------------------------------------------------------------------------------------------
Cost of shares redeemed (1,003,034,037) (2,894,867,006)
- ----------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from share transactions 38,029,279 (94,650,349)
Net assets at the beginning of the period 515,403,058 610,053,407
- ----------------------------------------------------------------------------------------------
Net assets at the end of the period $ 553,432,337 $ 515,403,058
==============================================================================================
</TABLE>
14 See accompanying notes to financial statements.
<PAGE>
Notes to Financial Statements (Unaudited)
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
1. General Information and Significant Accounting Policies
The Nuveen Tax-Exempt Money Market Fund, Inc. (the "Fund") is registered under
the Investment Company Act of 1940 as an open-end, diversified management
investment company. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements in
accordance with generally accepted accounting principles.
Securities Valuation
The Fund invests in short-term municipal securities maturing within one year
from the date of acquisition. Securities with a maturity of more than one year
in all cases have variable rate and demand features qualifying them as short-
term securities and are valued at amortized cost. On a dollar-weighted basis,
the average maturity of all such securities must be 90 days or less (at August
31, 1997, the dollar-weighted average life was 46 days).
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. Any securities so purchased are subject
to market fluctuation during this period. The Fund has instructed the custodian
to segregate assets in a separate account with a current value at least equal
to the amount of its when-issued and delayed delivery purchase commitments. At
August 31, 1997, there were no such purchase commitments.
Interest Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts.
Dividends and Distributions to Shareholders
Tax-exempt net investment income, adjusted for realized short-term gains and
losses on investment transactions, is declared as a dividend to shareholders of
record as of the close of each business day and payment is made or reinvestment
is credited to shareholder accounts after month-end.
Federal Income Taxes
The Fund intends to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its tax-
exempt net investment income, including any net realized capital gains from
investment transactions. Therefore, no federal income tax provision is required.
Furthermore, the Fund intends to satisfy conditions which will enable interest
from municipal securities, which is exempt from regular federal income tax, to
retain such tax-exempt status when distributed to shareholders of the Fund. Net
realized capital gain distributions, if any, are subject to federal taxation.
Insurance Commitments
The Fund has obtained commitments (each a "Commitment") from Municipal Bond
Investors Assurance Corporation ("MBIA") with respect to certain designated
bonds held by the Fund for which credit support is furnished by banks ("Approved
Banks") approved by MBIA under its established credit approval standards. Under
the terms of
15
<PAGE>
Notes to Financial Statements (Unaudited) - continued
a Commitment, if the Fund were to determine that certain adverse circumstances
relating to the financial condition of the Approved Banks had occurred, the Fund
could cause MBIA to issue a "while-in-fund" insurance policy covering the
underlying bonds; after time and subject to further terms and conditions, the
Fund could obtain from MBIA an "insured-to-maturity" insurance policy as to the
covered bonds. Each type of insurance policy would insure payment of interest on
the bonds and payment of principal at maturity. Although such insurance would
not guarantee the market value of the bonds or the value of the Fund's shares,
the Fund believes that its ability to obtain insurance for such bonds under such
adverse circumstances will enable the Fund to hold or dispose of such bonds at a
price at or near their par value.
Derivative Financial Instruments
The Fund may invest in certain derivative financial instruments including
futures, forward, swap, option contracts, and other financial instruments with
similar characteristics. Although the Fund is authorized to invest in such
financial instruments, and may do so in the future, it did not make any such
investments during the six months ended August 31, 1997.
Use of Estimates
The preparation of financial statements in conformity with 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 from operations during the reporting period.
2. Securities Transactions
Purchases and sales (including maturities) of investment in short-term municipal
securities during the six months ended August 31, 1997, aggregated $878,436,017
and $858,640,000, respectively.
At August 31, 1997, the cost of investments owned for federal income tax
purposes was the same as the cost for financial reporting purposes.
3. Management Fee and Other Transactions with Affiliates
Under the Fund's investment management agreement with Nuveen Advisory Corp. (the
"Adviser"), a wholly owned subsidiary of The John Nuveen Company, the Fund pays
an annual management fee, payable monthly, as follows:
<TABLE>
<CAPTION>
Average daily net asset value Management fee
- --------------------------------------------------------------------------------
<S> <C>
For the first $500 million .400 of 1%
For the next $500 million .375 of 1
For the next $1 billion .350 of 1
For net assets over $2 billion .325 of 1
- --------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
The management fee is reduced by, or the Adviser assumes certain Fund expenses
in an amount necessary to prevent the Fund's total expenses (including the
Adviser's fee, but excluding interest, taxes, fees incurred in acquiring and
disposing of portfolio securities and, to the extent permitted, extraordinary
expenses) in any fiscal year from exceeding .45 of 1% of the average daily net
asset value of the Fund.
The management fee compensates the Adviser for overall investment advisory and
administrative services, and general office facilities. The Fund pays no
compensation directly to its Directors who are affiliated with the Adviser or to
its officers, all of whom receive remuneration for their services to the Fund
from the Adviser.
4. Composition of Net Assets
At August 31, 1997, the Fund had 5 billion shares of $.01 par value stock
authorized. Net assets consisted of $553,432,337 paid-in capital.
5. Investment Composition
The Fund invests in municipal securities which include general obligation and
revenue bonds. At August 31, 1997, the revenue sources by municipal purpose,
expressed as a percent of total investments, were as follows:
<TABLE>
- -------------------------------------------
<S> <C>
Revenue Bonds:
Health Care Facilities 18%
Pollution Control Facilities 15
Housing Facilities 8
Educational Facilities 5
Transportation 5
Water/Sewer Facilities 5
Utilities 5
Industrial Development 4
Other 17
General Obligation Bonds 18
- -------------------------------------------
100%
===========================================
</TABLE>
At August 31, 1997, 86% of the investments owned by the Fund have credit
enhancements (letters of credit, guarantees or insurance) issued by a third
party domestic or foreign banks or other institutions (see note 1).
For additional information regarding each investment security, refer to the
Portfolio of Investments.
17
<PAGE>
Financial Highlights (Unaudited)
Selected data for a share outstanding throughout each period is as follows:
<TABLE>
<CAPTION>
Operating performance Less distributions
------------------------ --------------------------
Net
Net realized and Dividends Net Total
asset unrealized from tax- asset return
value Net gain (loss) exempt net Distributions value on net
Year ending beginning investment from investment from capital end of asset
February 28/29, of period income investments income gains period value(a)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1998(d) $ 1.00 $ .02 $ -- $ (.02) $ -- $ 1.00 1.65%
1997 1.00 .03 -- (.03) -- 1.00 3.11
1996 1.00 .03 -- (.03) -- 1.00 3.42
1995 1.00 .03 -- (.03) -- 1.00 2.69
1994 1.00 .02 -- (.02) -- 1.00 2.04
1993 1.00 .03 -- (.03) -- 1.00 2.57
1992(c) 1.00 .02 -- (.02) -- 1.00 1.56
1991(b) 1.00 .05 -- (.05) -- 1.00 4.85
1990(b) 1.00 .06 -- (.06) -- 1.00 5.75
1989(b) 1.00 .06 -- (.06) -- 1.00 6.00
1988(b) 1.00 .05 -- (.05) -- 1.00 4.89
- ------------------------------------------------------------------------------------------------------------------
* Annualized.
(a) Total returns are calculated on net asset value. Total returns for periods less than one year are not annualized.
(b) For the year ending September 30.
(c) For the five months ending February 29.
(d) For the six months ending August 31, 1997.
</TABLE>
18
<PAGE>
Nuveen Tax-Exempt Money Market Fund, Inc.
August 31, 1997 Semiannual Report
<TABLE>
<CAPTION>
Ratios/Supplemental data
- --------------------------------------------
Ratio
of net
Ratio of investment
Net assets expenses income to
end of period to average average
(in thousands) net assets net assets
- --------------------------------------------
<S> <C> <C>
$ 553,432 .44%* 3.26%*
515,403 .44 3.10
610,053 .44 3.43
759,244 .44 2.65
975,833 .42 2.04
1,597,014 .40 2.58
2,332,021 .39* 3.71*
1,927,583 .38 4.81
1,800,966 .40 5.74
1,756,725 .39 6.02
2,044,479 .39 4.90
- --------------------------------------------
</TABLE>
19
<PAGE>
Fund Information
Board of Directors
Robert P. Bremmer
Lawrence H. Brown
Anthony T. Dean
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Custodian
The Chase Manhattan Bank
4 New York Plaza
New York, NY 10004
Transfer Agent,
Shareholder Services and
Dividend Disbursing Agent
Shareholder Services, Inc.
Nuveen Investor Services
P.O. Box 5330
Denver, CO 80217
(800) 621-7227
Legal Counsel
Fried, Frank, Harris,
Shriver & Jacobson
Washington, D.C.
Independent
Public Accountants
Arthur Andersen LLP
Chicago, Illinois
20
<PAGE>
Serving Investors
for Generations
[PHOTO OF JOHN NUVEEN, SR. APPEARS HERE]
Since our founding in 1898, John Nuveen & Co. has been synonymous with
investments that withstand the test of time. Today, we offer a broad range of
investments designed for mature investors whose portfolios are the principal
source of their ongoing financial security. More than 1.3 million investors have
trusted Nuveen to help them maintain the lifestyle they currently enjoy.
To meet the unique circumstances and financial planning needs of mature
investors, Nuveen offers a wide array of equity and fixed-income mutual funds,
unit trusts, exchange-traded funds, individual managed account services, and
cash management products, including many that generate tax-free income.
To find out more about how Nuveen investment products and services can help you
preserve your financial security, talk with your financial adviser, or call us
at (800) 621-7227 for more information, including a prospectus where applicable.
Please read that information carefully before you invest.
NUVEEN
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL 60606-1286
(800) 621-7227
www.nuveen.com
MSA-2-8.97
