Company: MYI
Filing Date: 2025-09-05
Form Type: 424B3
Source: 0001193125-25-196285
Chunk: 231

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-09-05
Form: 424B3
Chunk 231
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 and will be subject to an increased interest rate based on number of days the loan is outstanding.

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MVF may invest in a TOB Trust on either a
non-recourse or recourse basis. When MVF invests in TOB Trusts on a non-recourse basis, and the TOBs Liquidity Provider is required to make a payment under the liquidity
facility, the TOBs Liquidity Provider will typically liquidate all or a portion of the MVF Municipal Bonds held in the TOB Trust and then fund the balance, if any, of the Liquidation Shortfall. If MVF invests in a TOB Trust on a recourse basis, it
will typically enter into a reimbursement agreement with the TOBs Liquidity Provider pursuant to which MVF is required to reimburse the TOBs Liquidity Provider the amount of any Liquidation Shortfall. As a result, if MVF invests in a recourse TOB
Trust, MVF will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised Funds participate in any such TOB Trust, these losses will be shared ratably, in proportion to their participation in the TOB Trust.

Under accounting rules, municipal securities of MVF that are deposited into a TOB Trust are investments of MVF and are
presented on MVF’s Schedule of Investments and outstanding TOB Floaters issued by a TOB Trust are presented as liabilities in MVF’s Statement of Assets and Liabilities. Interest income from the underlying municipal securities is recorded
by MVF on an accrual basis. Interest expense incurred on the TOB Floaters and other expenses related to remarketing, administration, trustee and other services to a TOB Trust are reported as expenses of MVF. In addition, under accounting rules,
loans made to a TOB Trust sponsored by MVF may be presented as loans of MVF in MVF’s financial statements even if there is no recourse to MVF’s assets.

For TOB Floaters, generally, the interest rate earned will be based upon the market rates for MVF Municipal Bonds with
maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option. Since the tender option feature has a shorter term than the final maturity or first call date of the underlying MVF Municipal Bonds
deposited in the TOB Trust, the holder of the TOB Floaters relies upon the terms of the agreement with the financial institution furnishing the liquidity facility as well as