Company: MYI
Filing Date: 2025-08-08
Form Type: PRE 14A
Source: 0001193125-25-176952
Chunk: 239

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-08-08
Form: PRE 14A
Chunk 239
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 than those imposed by the 1940 Act. The Investment Advisor does not believe that these covenants or
guidelines will impede it from managing MVF’s portfolio in accordance with its investment objective and policies if MVF were to utilize leverage.

Under the Investment Company Act, MVF is not permitted to issue senior securities if, immediately after the issuance of such senior
securities, MVF would have an asset coverage ratio (as defined in the 1940 Act) of less than 300% with respect to senior securities representing indebtedness (i.e., for every dollar of indebtedness outstanding, MVF is required to have at
least three dollars of assets) or less than 200% with respect to senior securities representing preferred shares (i.e., for every dollar of preferred shares outstanding, MVF is required to have at least two dollars of assets). The Investment
Company Act also provides that MVF may not declare distributions, or purchase its stock (including through tender offers) if, immediately after doing so, it will have an asset coverage ratio of less than 300% or 200%, as applicable. Under the 1940
Act, certain short-term borrowings (such as for cash management purposes) are not subject to these limitations if (i) repaid within 60 days, (ii) not extended or renewed, and (iii) not in excess of 5% of the total assets of MVF.

Preferred Shares.MVF has leveraged its portfolio by issuing VMTP Shares. Under the 1940 Act, MVF is not permitted to issue preferred
shares if, immediately after such issuance, the liquidation value of MVF’s outstanding preferred shares exceeds 50% of its assets (including the proceeds from the issuance) less liabilities other than borrowings (i.e., the value of MVF’s
assets must be at least 200% of the liquidation value of its outstanding preferred shares). In addition, MVF would not be permitted to declare any cash dividend or other distribution on its common shares unless, at the time of such declaration, the
value of MVF’s assets less liabilities other than borrowings is at least 200% of such liquidation value.

For tax purposes, MVF is
currently required to allocate tax-exempt interest income, net capital gain and other taxable income, if any, between its common shares and preferred shares outstanding in proportion to total dividends paid to
each class for the year in which or with respect to which tax-exempt income,