Company: MYI
Filing Date: 2025-08-08
Form Type: PRE 14A
Source: 0001193125-25-176952
Chunk: 241

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-08-08
Form: PRE 14A
Chunk 241
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 the TOB Trust from the sale of the TOB Floaters, less certain transaction costs, and typically will invest the cash to purchase additional MVF
Municipal Bonds or other investments permitted by its investment policies. If MVF 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 MVF Municipal Bonds owned by the TOB Trust.

Other BlackRock-advised funds may
contribute MVF Municipal Bonds to a TOB Trust into which MVF has contributed MVF 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 MVFs ratably in proportion to their participation in the TOB Trust.

The MVF Municipal Bonds transferred to a TOB Trust
typically are high grade MVF Municipal Bonds. In certain cases, when MVF Municipal Bonds transferred are lower grade MVF 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 MVF, 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 MVF generally provide MVF 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, MVF may withdraw a corresponding share of the MVF Municipal Bonds from the TOB Trust. As a
result, a TOB transaction, in effect, creates exposure for MVF to the entire return of the MVF Municipal Bonds in the TOB Trust, with a net cash investment by MVF that is less than the value of the MVF Municipal Bonds in the TOB Trust. This
multiplies the positive or negative impact of the MVF Municipal Bonds’ return within MVF (thereby creating leverage). The leverage within a TOB Trust depends on the value of the MVF Municipal Bonds deposited in the TOB Trust relative to the
value of the TOB Floaters it issues.

MVF may invest in highly leveraged TO