Step 1: Concept
Restriction enzymes cut the sugar-phosphate backbone of DNA at specific recognition sites.
Step 2: Meaning
The chemical structure of the resulting DNA ends is critical for subsequent steps like ligation.
Step 3: Analysis
Statement I is false because standard restriction digestion leaves a 5' phosphate and a 3' hydroxyl (-OH) group. Statement II is true as "cohesive" or "sticky" ends are single-stranded overhangs that readily pair (reanneal) with complementary sequences through hydrogen bonding.
Step 4: Conclusion
As Statement I incorrectly identifies the groups at the 3' and 5' positions, only Statement II is correct.
Final Answer: (D)