Company: MYI
Filing Date: 2025-07-16
Form Type: N-14 8C
Source: 0001193125-25-159991
Chunk: 218

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-07-16
Form: N-14 8C
Chunk 218
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The use of Strategic Transactions may result in losses greater
than if they had not been used, may require MVF to sell or purchase portfolio securities at inopportune times or for prices other than current market values, may limit the amount of appreciation MVF can realize on an investment or may cause MVF to
hold a security that it might otherwise sell. Furthermore, MVF may only engage in Strategic Transactions from time to time and may not necessarily be engaging in hedging activities when movements in interest rates occur.

MVF’s investment objectives and the requirements of Subchapter M of the Code for qualification as a regulated investment company may
restrict or affect the ability of MVF to engage in Strategic Transactions. In addition, the use of certain Strategic Transactions may give rise to taxable income and have certain other consequences, such as subjecting a portion of MVF’s
dividends to regular federal income tax. However, under normal circumstances, MVF does not intend to use Strategic Transactions that give rise to taxable income.

104

Put and Call Options on Securities and Indices. MVF may purchase and sell put and call options on
securities and indices. A put option gives the purchaser of the option the right to sell and the writer the obligation to buy the underlying security at the exercise price during the option period. MVF may also purchase and sell options on bond
indices (“index options”). Index options are similar to options on securities except that, rather than taking or making delivery of securities underlying the option at a specified price upon exercise, an index option gives the holder the
right to receive cash upon exercise of the option if the level of the bond index upon which the option is based is greater, in the case of a call, or less, in the case of a put, than the exercise price of the option. The purchase of a put option on
a debt security could protect MVF’s holdings in a security or a number of securities against a substantial decline in the market value. A call option gives the purchaser of the option the right to buy and the seller the obligation to sell the
underlying security or index at the exercise price during the option period or for a specified period prior to a fixed date. The purchase of a call option on a security could protect MVF against an increase in the price of a security that it
intended to purchase in the future.

Writing Covered Call Options. MVF is authorized to write (i.e., sell) covered call options with respect to
municipal securities it owns