Company: MYI
Filing Date: 2025-07-16
Form Type: N-14 8C
Source: 0001193125-25-159991
Chunk: 237

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-07-16
Form: N-14 8C
Chunk 237
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 reverse repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on the issuance of senior securities in Section 18 of the 1940 Act, provided that MVF either (i) complies
with the 300% asset coverage ratio applicable to senior securities representing indebtedness with respect to such transactions and any other borrowings in the aggregate, or (ii) treats such transactions as derivatives transactions under Rule 18f-4. Future regulatory requirements or SEC guidance may necessitate more onerous contractual or regulatory requirements, which may increase the costs or reduce the degree of potential economic benefits of TOB
Trust transactions or limit MVF’s ability to enter into or manage TOB Trust transactions.

See “Risk Factors and Special
Considerations—General Risks of Investing in the Acquiring Fund—Tender Option Bond Risk” for a description of the risks involved with a TOB issuer.

113

Reverse Repurchase Agreements.MVF may enter into reverse repurchase agreements with respect to its
portfolio investments subject to the investment restrictions set forth herein. Reverse repurchase agreements involve the sale of securities held by MVF with an agreement by MVF to repurchase the securities at an agreed upon price, date and interest
payment. In accordance with Rule 18f-4 under the 1940 Act, when MVF engages in reverse repurchase agreements and similar financing transactions, MVF may either (i) maintain asset coverage of at least 300%
with respect to such transactions and any other borrowings in the aggregate, or (ii) treat such transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to such
transactions. Reverse repurchase agreements involve the risk that the market value of the securities acquired in connection with the reverse repurchase agreement may decline below the price of the securities MVF has sold but is obligated to
repurchase. Also, reverse repurchase agreements involve the risk that the market value of the securities retained in lieu of sale by MVF in connection with the reverse repurchase agreement may decline in price.

If the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes insolvent, such buyer or its trustee or receiver may receive
an extension of time to determine whether to enforce MVF’s obligation to repurchase the securities and MVF’s use of the proceeds of the reverse repurchase agreement may effectively be restricted pending such decision. Also, MVF would bear
the risk of loss to the extent that the proceeds of the reverse