Company: BLE
Filing Date: 2025-08-07
Form Type: PRE 14A
Source: 0001193125-25-175555
Chunk: 138

Company: BLACKROCK MUNICIPAL INCOME TRUST II
Filing Date: 2025-08-07
Form: PRE 14A
Chunk 138
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 times believe that bonds associated with a particular municipal market
sector (for example, but not limited to electric utilities), or issued by a particular municipal issuer, are undervalued. The Manager may purchase those bonds for BYM’s portfolio because they represent a market sector or issuer that the Manager
considers undervalued, even if the value of those particular bonds appears to be consistent with the value of similar bonds. Municipal Bonds of particular types (for example, but not limited to hospital bonds, industrial revenue bonds or bonds
issued by a particular municipal issuer) may be undervalued because there is a temporary excess of supply in that market sector, or because of a general decline in the market price of Municipal Bonds of the market sector for reasons that do not
apply to the particular Municipal Bonds that are considered undervalued. BYM’s investment in underrated or undervalued Municipal Bonds will be based on the Manager’s belief that their yield is higher than that available on bonds bearing
equivalent levels of interest rate risk, credit risk and other forms of risk, and that their prices will ultimately rise, relative to the market, to reflect their true value. Any capital appreciation realized by BYM will generally result in capital
gain distributions subject to federal capital gains taxation.

BYM ordinarily does not intend to realize significant investment income not
exempt from federal income tax. From time to time, BYM may realize taxable capital gains. Federal tax legislation has limited the types and volume of bonds the interest on which qualifies for a federal income tax exemption. As a result, this
legislation and legislation that may be enacted in the future may affect the availability of Municipal Bonds for investment by BYM.

Description of Municipal Bonds

See “The Acquiring Fund’s Investments – Description of Municipal Bonds” for additional
information regarding the types of municipal bonds in which MHD invests.

Tender Option Bond Transactions

BYM currently leverages its assets through the use of TOB Residuals, which are derivative interests in municipal bonds. The TOB Residuals in
which BYM will invest pay interest or income that, in the opinion of counsel to the issuer of such TOB Residuals, is exempt from regular U.S. federal income tax. No independent investigation will be made to confirm the
tax-exempt status of the interest or income paid by TOB Residuals held by BYM. Although volatile, TOB Residuals typically offer the potential for yields exceeding the yields available on fixed rate municipal
bonds with