Company: MYI
Filing Date: 2025-09-02
Form Type: N-14 8C/A
Source: 0001193125-25-193985
Chunk: 195

Company: BLACKROCK MUNIYIELD QUALITY FUND III, INC.
Filing Date: 2025-09-02
Form: N-14 8C/A
Chunk 195
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 to recover the full amount of assets deposited on its behalf with the clearing
organization in the event of the default by the clearing organization or MIY’s clearing broker. Certain U.S. federal income tax requirements may limit MIY’s ability to engage in interest rate swaps. Distributions attributable to
transactions in interest rate swaps generally will be taxable as ordinary income to shareholders.

Counterparty Credit Standards.

To the extent that MIY engages in principal transactions, including, but not limited to, OTC options, forward currency transactions, swap
transactions, repurchase and reverse repurchase agreements and the purchase and sale of bonds and other fixed-income securities, it must rely on the creditworthiness of its counterparties under such transactions. In certain instances, the credit
risk of a counterparty is increased by the lack of a central clearing house for certain transactions, including certain swap contracts. In the event of the insolvency of a counterparty, MIY may not be able to recover its assets, in full or at all,
during the insolvency process. Counterparties to investments may have no obligation to make markets in such investments and may have the ability to apply essentially discretionary margin and credit requirements. Similarly, MIY will be subject to the
risk of bankruptcy of, or the inability or refusal to perform with respect to such investments by, the counterparties with which it deals. The Investment Advisor will seek to minimize MIY’s exposure to counterparty risk by entering into such
transactions with counterparties the Investment Advisor believes to be creditworthy at the time it enters into the transaction. Certain option transactions and Strategic Transactions may require MIY to provide collateral to secure its performance
obligations under a contract, which would also entail counterparty credit risk.

Other Investment Policies

MIY has adopted certain other policies as set forth below.

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Index and Inverse Securities

MIY may invest in MIY Municipal Bonds yielding a return based on a particular index of value or interest rates. Also, MIY may invest in so-called “inverse floating obligations” or “residual interest bonds” on which the interest rates typically vary inversely with a short-term floating rate (which
may be reset periodically by a dutch auction, a remarketing agent, or by reference to a short-term tax-exempt interest rate index). MIY may purchase synthetically-created inverse floating
obligations evidenced by custodial or trust receipts.

Call Rights

MIY may purchase a MIY Municipal Bond issuer’s right to call all or a portion of such MI