Company: BLE
Filing Date: 2025-09-08
Form Type: DEF 14A
Source: 0001193125-25-198164
Chunk: 132

Company: BLACKROCK MUNICIPAL INCOME TRUST II
Filing Date: 2025-09-08
Form: DEF 14A
Chunk 132
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 and is paid the cash received by the TOB Trust 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 BLE 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 registered investment companies advised by the Investment Advisor or its affiliates (“BlackRock-Advised Funds”) may
contribute municipal bonds to a TOB Trust into which BLE 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 BLE, 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 BLE generally provide BLE 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, BLE may withdraw a corresponding share of the municipal bonds from the TOB Trust. As a result, a tender option bond
transaction, in effect, creates exposure for BLE to the entire return of the municipal bonds in the TOB Trust, with a net cash investment by BLE 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 BLE (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.

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BLE may invest in highly leveraged TOB Residuals. A TOB Residual generally is