Company: RFMZ
Filing Date: 2025-09-05
Form Type: N-CSR
Source: 0001398344-25-017693
Chunk: 57

Company: RiverNorth Flexible Municipal Income Fund II, Inc.
Filing Date: 2025-09-05
Form: N-CSR
Chunk 57
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 in duration
to the periodic interval of the tender option, which may vary from weekly, to monthly, to extended periods of one year or multiple years.
Since the option feature has a shorter term than the final maturity or first call date of the underlying securities deposited in the TOB
Issuer, the Fund, if it is the holder of the TOB Floaters, relies upon the terms of the agreement with the financial institution furnishing
the option as well as the credit strength of that institution. As further assurance of liquidity, the terms of the TOB Issuer provide
for a liquidation of the municipal security deposited in the TOB Issuer and the application of the proceeds to pay off the TOB Floaters.

There are inherent risks with respect to investing
in a TOB Issuer. These risks include, among others, the bankruptcy or default of the issuer of the securities deposited in the TOB Issuer,
a substantial downgrade in the credit quality of the issuer of the securities deposited in the TOB Issuer, the inability of the TOB Issuer
to obtain liquidity support for the TOB Floaters, a substantial decline in the market value of the securities deposited in the TOB Issuer,
or the inability of the sponsor or remarketing agent to remarket any TOB Floaters tendered to it by holders of the TOB Floaters.

Effects of Leverage. The use of proceeds
from tender option bond transactions represented approximately 41.40% of Managed Assets as of June 30, 2025. Asset coverage with respect
to tender option bond transactions was 242%. Borrowings under the BNP Facility bear interest at the Overnight Bank Funding Rate plus a
fixed rate determined by the securities pledged as collateral. Any unused portion of the BNP Facility is also subject to a commitment
fee of 0.50% of the unused portion of the facility until a realization of 80% or greater is met. As of June 30, 2025, the average daily
weighted interest rate applicable to the leverage attended through the use of tender option bond transactions during the period ended
June 30, 2025 was 3.61% of the note obligation outstanding. The total weighted average cost of the leverage outstanding as of June 30,
2025 (inclusive of the leverage attended through the use of tender option bond transactions) was 3.61% of the principal amount outstanding.
Assuming that the Fund’s leverage costs remain as described above (at an assumed annual cost of