Company: BLE
Filing Date: 2025-09-08
Form Type: DEF 14A
Source: 0001193125-25-198164
Chunk: 147

Company: BLACKROCK MUNICIPAL INCOME TRUST II
Filing Date: 2025-09-08
Form: DEF 14A
Chunk 147
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 from the sale of the TOB Floaters, less
certain transaction costs, and typically will invest the cash to purchase additional municipal bonds or other investments permitted by its investment policies. If BFK ever purchases all or a portion of the TOB Floaters sold by the TOB Trust, it may
surrender those TOB Floaters together with a proportionate amount of TOB Residuals to the TOB Trust in exchange for a proportionate amount of the municipal bonds owned by the TOB Trust.

Other BlackRock-advised funds may contribute municipal bonds to a TOB Trust into which BFK has contributed municipal bonds. If multiple
BlackRock-advised Funds participate in the same TOB Trust, the economic rights and obligations under the TOB Residual will generally be shared among the funds ratably in proportion to their participation in the TOB Trust.

The municipal bonds transferred to a TOB Trust typically are high grade municipal bonds. In certain cases, when municipal bonds transferred
are lower grade municipal bonds, the TOB Trust transaction includes a credit enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by a credit enhancement provider. The TOB Trust would be
responsible for the payment of the credit enhancement fee and BFK, as a TOB Residual holder, would be responsible for reimbursement of any payments of principal and interest made by the credit enhancement provider.

The TOB Residuals held by BFK generally provide BFK with the right to cause the holders of a proportional share of the TOB Floaters to tender
their notes to the TOB Trust at par plus accrued interest. Thereafter, BFK may withdraw a corresponding share of the municipal bonds from the TOB Trust. As a result, a TOB transaction, in effect, creates exposure for BFK to the entire return of the
municipal bonds in the TOB Trust, with a net cash investment by BFK that is less than the value of the municipal bonds in the TOB Trust. This multiplies the positive or negative impact of the municipal bonds’ return within BFK (thereby
creating leverage). The leverage within a TOB Trust depends on the value of the municipal bonds deposited in the TOB Trust relative to the value of the TOB Floaters it issues.

BFK may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if the principal amount of the TOB
Floaters issued by the