Company: MYI
Filing Date: 2025-08-08
Form Type: PRE 14A
Source: 0001193125-25-176952
Chunk: 244

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-08-08
Form: PRE 14A
Chunk 244
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 furnishing the liquidity facility as well as the credit strength of that institution. The perceived reliability and creditworthiness,
of many major financial institutions, some of which sponsor and/or provide liquidity support to TOB Trusts increases the risk associated with TOB Floaters. This in turn may reduce the desirability of TOB Floaters as investments, which could impair
the viability or availability of TOB Trusts.

Rule 18f-4 under the 1940 Act permits MVF to enter
into TOB Trust transactions, 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.

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

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“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