EXPENSE REIMBURSEMENT AGREEMENT
AGREEMENT made this 1st day of August, 2002, by and between NUVEEN QUALITY
PREFERRED INCOME FUND 2, a Massachusetts business trust (the "Fund"), and NUVEEN
INSTITUTIONAL ADVISORY CORP., a Delaware corporation (the "Adviser").
WITNESSETH
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WHEREAS, the Fund and the Adviser have separately entered into an Investment
Management Agreement of even date herewith (the "Management Agreement"); and
WHEREAS, the Adviser in turn has entered into an Investment Sub-Advisory
Agreement of even date herewith (the "Sub-Advisory Agreement") with Spectrum
Asset Management, Inc. (the "Sub-Adviser");
NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained,
and in connection with the establishment and commencement of operations of the
Fund, it is hereby agreed by and between the parties hereto as follows:
1. For the period from the commencement of the Fund's operations through
September 30, 2002 and for the 12 month periods ending September 30 in each
indicated year during the term of the Management Agreement (including any
continuation done in accordance with Section 15(c) of the Investment Company Act
of 1940), the Adviser agrees to reimburse expenses (including the management fee
and other expenses) in the amounts determined by applying the following annual
rates to the average daily net assets of the Fund:
Percentage Reimbursed (as a Percentage Reimbursed (as
Period Ending percentage of average daily net Period Ending a percentage of average
September 30 assets)(1) September 30 daily net assets)(1)
2002(2) .32%
2003 .32% 2008 .24%
2004 .32% 2009 .16%
2005 .32% 2010 .08%
2006 .32%
2007 .32%
(1) Including net assets attributable to the Fund's Preferred Shares and the
principal amount of borrowings.
(2) From the commencement of operations.
The Fund understands that the Adviser and the Sub-Adviser have determined to
effectively allocate the expense reimbursement obligation hereunder between
themselves pursuant to a schedule set forth in the Sub-Advisory Agreement.
2. To effect the expense reimbursement provided for in this Agreement, the Fund
may offset the appropriate amount of the reimbursement contemplated hereunder
against the management fee payable under the Management Agreement.
3. This Agreement, and the Adviser's obligation to so reimburse expenses
hereunder, shall terminate on the earlier of (a) September 30, 2010 or (b)
termination of the Management Agreement.
4. Except as provided in paragraph 3, above, this Agreement may be terminated
only by the vote of (a) the Board of Trustees of the Fund, including the vote of
the members of the Board who are not "interested persons" within the meaning of
the Investment Company Act of 1940, and (b) a majority of the outstanding voting
securities of the Fund.
5. If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule, or otherwise, the remainder shall not be thereby
affected.
6. The Fund's Declaration of Trust is on file with the Secretary of the
Commonwealth of Massachusetts. This Agreement is executed on behalf of the Fund
by the Fund's officers as officers and not individually and the obligations
imposed upon the Fund by this Agreement are not binding upon any of the Fund's
Trustees, officers or shareholders individually but are binding only upon the
assets and property of the Fund.
7. This Agreement shall be construed in accordance with applicable federal law
and (except as to Section 6 hereof which shall be construed in accordance with
the laws of Massachusetts) the laws of the State of Illinois.
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IN WITNESS WHEREOF, the Fund and the Adviser have caused this Agreement
to be executed on the day and year above written.
NUVEEN QUALITY PREFERRED INCOME FUND 2
by: /s/ Xxxxxxx X. Xxxxxxxxx
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Vice President
Attest: /s/ Xxxxxxxx X. X'Xxxx
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Assistant Secretary
NUVEEN INSTITUTIONAL ADVISORY CORP.
by: /s/ Xxxxxxx X. Xxxxxxxxxx
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Managing Director
Attest: /s/ Xxxxxxx X. Xxxxxxx
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Assistant Secretary
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