Skadden, Arps, Slate, Meagher & Flom LLP
333 West Wacker Drive
Chicago, Illinois 60606
September 6, 2005
Mr. Larry Greene
Mr. Jim Campbell
Mr. Kevin Rupert
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: Van Kampen Advantage Municipal Income
Trust II--Registration Statement on Form N-14
(the "Registration Statement")
(File Nos. 333-126299 and 811-07868)
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Dear Messrs. Greene, Campbell and Rupert:
Thank you for your additional telephonic comments to the
Registration Statement on Form N-14 for Van Kampen Advantage Municipal Income
Trust II (the "Acquiring Fund" or the "Registrant"), filed with the Securities
and Exchange Commission (the "Commission") in connection with the proposed
reorganizations (the "Reorganizations") of Van Kampen Municipal Opportunity
Trust II and Van Kampen Value Municipal Income Trust (the "Target Funds") into
the Acquiring Fund. On behalf of the Acquiring Fund, we have summarized your
comments to the best of our understanding, below which we have provided our
response to those comments. We have not included comments which we resolved in
the course of our conference calls with you. Where changes were necessary in
response to your comments, they will be reflected in the final Joint Proxy
Statement/Prospectus and/or Reorganization Statement of Additional Information
filed with the Commission pursuant to Rule 497 of the General Rules and
Regulations under the Securities Act of 1933, as amended. The Target Funds and
the Acquiring Fund are referred to herein collectively as the "Funds."
COMMENTS TO THE JOINT PROXY STATEMENT/PROSPECTUS
COMMENT 1. UNDER "PROPOSAL 1--COMPARISON OF THE FUNDS--OTHER INVESTMENT
PRACTICES AND POLICIES--STRATEGIC TRANSACTIONS," PROVIDE
ADDITIONAL DISCLOSURE REGARDING EACH FUND'S COMPLIANCE WITH
APPLICABLE REGULATORY REQUIREMENTS WHEN IMPLEMENTING STRATEGIC
TRANSACTIONS.
Response 1. The Funds have provided the following additional disclosure at
the end of the first paragraph of this section:
"..., including the maintenance of cash and/or liquid
securities in segregated accounts when mandated by SEC
rules."
COMMENT 2. CLARIFY YOUR RESPONSE TO OUR INITIAL COMMENT REQUESTING
ADDITIONAL DISCLOSURE REGARDING CAPITAL LOSS CARRYFORWARDS, IF
APPLICABLE.
Response 2. The combined fund's ability to use pre-reorganization capital
loss carryforwards attributable to the Funds will not be
materially limited by the Internal Revenue Code as a result of
the Reorganizations. Therefore, the Funds do not believe
disclosure regarding capital loss carryforwards is necessary.
ACCOUNTING COMMENTS
COMMENT 3. WITH RESPECT TO THE FEE TABLE UNDER "SUMMARY--PROPOSAL 1:
REORGANIZATION OF THE TARGET FUNDS," DISCLOSE THE REASON FOR THE
DIFFERENCES IN THE INVESTMENT ADVISORY FEE FOR THE FUNDS ON AN
ACTUAL AND PRO FORMA BASIS.
Response 3. The Funds have replaced the second sentence in footnote (d) to
the fee table with the following:
"As noted in the table, advisory fees are stated as a
percentage of net assets attributable to common shares only.
If assets attributable to preferred shares were included,
the advisory fees would be 0.55% for each Fund and the
Acquiring Fund on a pro forma basis. Thus, while each Fund
has the same advisory fee rate, the differences in advisory
fees in the table reflect the relative leverage ratios for
each Fund and the Acquiring Fund on a pro forma basis. The
proposed Reorganizations are intended to combine the the
Funds with their existing capital structures, which will
result in a weighted combined leverage ratio that each
Fund's Board and management believe is within an appropriate
range under current market conditions; the combined fund may
consider changes in its leverage ratio based on varying
market conditions in the future. See also the section
entitled 'Proposal 1: Reorganization of the Target
Funds--Comparison of the Funds--Capitalization.'"
COMMENT 4. WITH RESPECT TO THE CAPITALIZATION TABLE UNDER "PROPOSAL
1--COMPARISON OF THE FUNDS--CAPITALIZATION," DISCLOSE THE REASON
FOR THE DIFFERENCES IN NET ASSET VALUE PER COMMON SHARE FOR THE
FUNDS ON AN ACTUAL AND PRO FORMA BASIS.
Response 4. The Funds have added the second footnote to the last entry in the
last row of the table, which explains that the entry "[r]eflects
a non-recurring cost associated with the Reorganizations of
approximately $502,000...."
COMMENT 5. WITH RESPECT TO THE PROPOSED REORGANIZATIONS, PROVIDE A MORE
DETAILED ANALYSIS OF ISSUES RAISED BY THE STAFF OF THE SECURITIES
AND EXCHANGE COMMISSION IN NORTH AMERICAN SECURITY TRUST (PUBL.
AVAIL. AUG. 5, 1994) ("NORTH AMERICAN").
Response 5. The Funds' analysis of North American has been revised and filed
as a separate correspondence.
COMMENT 6. EXPLAIN SUPPLEMENTALLY THE BASIS FOR THE CHOICE OF JANUARY 31,
2005 AS THE DATE FOR THE PRO FORMA FINANCIAL STATEMENTS ATTACHED
AS APPENDIX J TO THE REORGANIZATION STATEMENT OF ADDITIONAL
INFORMATION AS OPPOSED TO APRIL 30, 2005, THE FUNDS' SEMI-ANNUAL
REPORTING PERIOD.
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Response 6. The Board of Trustees of 28 Van Kampen closed-end funds
(including the Funds) approved 17 reorganizations (including the
Reorganizations) on February 3, 2005. Shortly thereafter, a
filing schedule was created which split these 17 reorganizations
into three waves. The Reorganizations were part of the third
wave, which were expected to file in June, with an expected
effectiveness date in July. Because the expected effectiveness
date was more than 245 days from the end of the Funds' most
recent fiscal year end (October 31, 2004), pursuant to Rule
11-02(c)(1) and Rule 3-18(c) of Regulation S-X, it was determined
that pro forma financial statements would have to be prepared for
an interim date within 245 days of the expected effectiveness
date.
In February 2005, when the interim date was chosen, the Funds
anticipated that the initial filing (which would include the pro
forma financial statements) would be made in mid-June 2005, prior
to the date when the semi-annual financial statements for the
Funds were required to be prepared and filed with the SEC. Given
the SEC's desire that pro forma financial statements be included
in initial filings, it was determined that the pro forma
financial statements would be presented as of January 31, 2005,
which is each Fund's most recent fiscal quarter ended prior to
the date of the initial filing, reflecting financial data from
each Fund's Form N-Q filed in March 2005.
The Funds believe that this decision was a reasonable approach
under the circumstances. The Funds understand and acknowledge the
staff's comment that pro forma financial statements should
ordinarily be presented as of the annual or semi-annual financial
period. However, the Funds believe that, were they to be required
to update their pro forma financial statements, the
Reorganizations would be delayed and the costs of the
Reorganizations (which are borne by shareholders of the Funds)
would increase with no discernible benefit to shareholders.
Management has considered the financial position of each Fund as
of January 31, 2005 and April 30, 2005 and recommends adding the
following disclosure prior to the first use of pro forma
financial information in the Joint Proxy Statement/Prospectus:
Based on the anticipated timing of these Reorganizations,
the pro forma financial information presented herein and in
the Reorganization Statement of Additional Information was
prepared based on each Fund's first fiscal quarter ended
January 31, 2005. Each Fund has subsequently prepared and
filed financial statements for the semi-annual period ended
April 30, 2005. Management has considered the later
financial statements and does not believe there were
material changes in the relative financial positions of the
Funds such that it was necessary to update the pro forma
financial information.
Finally, the Funds note that their financial statements for the
semi-annual financial period ended April 30, 2005 are
incorporated by reference into the Joint Proxy
Statement/Prospectus and are attached as appendices to the
Reorganization Statement of Additional Information.
* * *
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In connection with the effectiveness of the Registration
Statement, the Registrant acknowledges that the disclosure included in the
Registration Statement is the responsibility of the Registrant. The Registrant
further acknowledges that the action of the Commission or the staff acting
pursuant to delegated authority in reviewing the Registration Statement does not
relieve the Registrant from its full responsibility for the adequacy and
accuracy of the disclosures in the Registration Statement; and that the
Registrant will not assert this action as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United
States.
Should you have any questions concerning our responses to your
comments, please direct them to Christopher Rohrbacher at (312) 407-0940 or the
undersigned at (312) 407-0863.
Sincerely,
/s/ Charles B. Taylor
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