Company: MYI
Filing Date: 2025-08-08
Form Type: PRE 14A
Source: 0001193125-25-176952
Chunk: 204

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-08-08
Form: PRE 14A
Chunk 204
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during the insolvency process. Counterparties to investments may have no obligation to make markets in such investments and may have the ability to apply essentially discretionary margin and credit requirements. Similarly, MIY will be subject to the
risk of bankruptcy of, or the inability or refusal to perform with respect to such investments by, the counterparties with which it deals. The Investment Advisor will seek to minimize MIY’s exposure to counterparty risk by entering into such
transactions with counterparties the Investment Advisor believes to be creditworthy at the time it enters into the transaction. Certain option transactions and Strategic Transactions may require MIY to provide collateral to secure its performance
obligations under a contract, which would also entail counterparty credit risk.

Other Investment Policies

MIY has adopted certain other policies as set forth below.

Index and Inverse Securities

103

MIY may invest in MIY Municipal Bonds yielding a return based on a particular index of value
or interest rates. Also, MIY may invest in so-called “inverse floating obligations” or “residual interest bonds” on which the interest rates typically vary inversely
with a short-term floating rate (which may be reset periodically by a dutch auction, a remarketing agent, or by reference to a short-term tax-exempt interest rate index). MIY may purchase
synthetically-created inverse floating obligations evidenced by custodial or trust receipts.

Call Rights

MIY may purchase a MIY Municipal Bond issuer’s right to call all or a portion of such MIY Municipal Bond for mandatory tender for
purchase (a “Call Right”). A holder of a Call Right may exercise such right to require a mandatory tender for the purchase of related MIY Municipal Bonds, subject to certain conditions. A Call Right that is not exercised prior to maturity
of the related MIY Municipal Bond will expire without value. The economic effect of holding both the Call Right and the related MIY Municipal Bond is identical to holding a MIY Municipal Bond as a non-callable
security. Certain investments in such obligations may be illiquid.

Repurchase Agreements

MIY may invest in securities pursuant to repurchase agreements. Repurchase agreements may be entered into only with a member bank of the
Federal Reserve System or a primary dealer or an affiliate thereof, in U.S. Government securities. A repurchase agreement is a contractual agreement whereby the seller of securities agrees to repurchase the same security at a specified price on a
future date agreed upon by the parties. The agreed-upon repurchase price