Form N-CEN - Annual Report for Registered Investment Companies
October 13 2023 - 1:12PM
Edgar (US Regulatory)
BLACKROCK
MUNIHOLDINGS QUALITY FUND II, INC.
ARTICLES
OF AMENDMENT
AMENDING THE ARTICLES SUPPLEMENTARY ESTABLISHING AND FIXING THE RIGHTS AND
PREFERENCES OF
VARIABLE RATE MUNI TERM PREFERRED SHARES
This is to
certify that:
First: The
charter of BlackRock MuniHoldings Quality Fund II, Inc., a Maryland corporation
(the “Corporation”), is amended by these Articles of Amendment, which amend the
Articles Supplementary Establishing and Fixing the Rights and Preferences of
Variable Rate Muni Term Preferred Shares, dated as of December 15, 2011, as
amended to date (the “Articles Supplementary”).
Second: The
charter of the Corporation is hereby amended by deleting the definition of
“Applicable Base Rate” in the Articles Supplementary and replacing it with the
following definition:
“Applicable Base
Rate” means (i) with respect to the initial Rate Period beginning on
December 1, 2022 and ending on December 7, 2022, the rate as calculated
pursuant to the Articles Supplementary as in place immediately prior to the
effectiveness of the Articles of Amendment dated December 1, 2022 and (ii) for
every succeeding Rate Period, 75% of Daily SOFR on the applicable Rate
Determination Date.
Third: The
charter of the Corporation is hereby amended by deleting the definition of
“LIBOR Dealer” in the Articles Supplementary.
Fourth: The
charter of the Corporation is hereby amended by deleting the definition of
“LIBOR Rate” in the Articles Supplementary.
Fifth: The
charter of the Corporation is hereby amended by deleting the definition of
“London Business Day” in the Articles Supplementary.
Sixth: The
charter of the Corporation is hereby amended by deleting the definition of
“Redemption Premium” in the Articles Supplementary and replacing it with the
following:
“Redemption Premium”
means with respect of a VMTP Preferred Share rated above A1/A+ and its
equivalent by all Rating Agencies then rating such VMTP Preferred Share at the
request of the Corporation and subject to any redemption, other than redemptions
required to comply with Minimum Asset Coverage requirements or exceed
compliance with the Minimum Asset Coverage requirements up to 240%, an amount
equal to the product of 1% and the Liquidation Preference of the VMTP Preferred
Shares subject to redemption if the Redemption Date is greater than or equal to
15 months from the Term Redemption Date, provided, up to 25% of the
Corporation’s VMTP Preferred Shares Outstanding as of
December 1, 2022 may be redeemed at any time without a Redemption Premium.
Any VMTP Preferred
Share exchanged for the preferred share of a surviving entity in connection
with a reorganization, merger, or redomestication of the Corporation in another
state that had been previously approved by the Holders of VMTP Preferred Shares
or that otherwise does not require the vote or consent of the Holders of VMTP
Preferred Shares shall not be subject to the Redemption Premium.
Seventh: The charter of the Corporation is
hereby amended by deleting the definition of “Reference Banks” in the Articles
Supplementary.
Eighth: The charter of the Corporation is
hereby amended by adding the definition for “Daily SOFR” in the Articles
Supplementary:
“Daily SOFR” means:
(1)
With respect to any Business Day means the secured overnight financing
rate published
for such day by the Federal Reserve Bank of New York, as the administrator of the benchmark (or a
successor administrator) on the Federal Reserve Bank of New York’s website (or any
successor source) as of 4:00 p.m. New York City time (such rate being initially
published for such day at 8:00 a.m. and may be revised until 2:30 p.m., New
York City time).
(2)
If the secured overnight financing rate cannot be determined with
respect to such any Business Day as specified in paragraph (1), unless both a
SOFR Index Cessation Event and a SOFR Index Cessation Date have occurred, then
the Redemption and Paying Agent shall use the secured overnight financing rate
in respect of the last Business Day for which such secured overnight financing rate
was published on the Federal Reserve Bank of New York’s website.
(3)
If a SOFR Index Cessation Event and SOFR Index Cessation Date have
occurred, the Redemption and Paying Agent shall determine the Applicable Base
Rate as if the reference to “75% of Daily SOFR” were a reference to the rate
that was recommended as the replacement for the secured overnight financing rate
by the Federal Reserve Board and/or the Federal Reserve Bank of New York or a
committee officially endorsed or convened by the Federal Reserve Board and/or
the Federal Reserve Bank of New York for the purpose of recommending a
replacement for the secured overnight financing rate (which rate may be
produced by a Federal Reserve Bank or other designated administrator, which
rate may include any adjustments or spreads, and which rate will be reasonably
expected to measure contemporaneous variations in the cost of newly borrowed
funds in U.S. dollars). If no such rate has been recommended within one
Business Day of the SOFR Index Cessation Event, then the Redemption and Paying Agent
shall use the OBFR published on the Federal Reserve Bank of New York’s website for any Business
Day after the SOFR Index Cessation Date (it being understood that the OBFR for
any such Business Day will be
the Overnight Bank
Funding Rate on the Federal Reserve Bank of New York’s website as of 4:00 p.m., New
York City time).
(4)
If the Redemption and Paying Agent is required to use the OBFR in
paragraph (3) above and an OBFR Index Cessation Event has occurred, then for
any Business Day after the OBFR Index Cessation Date, the Redemption and Paying
Agent shall use the short-term interest rate target set by the Federal Open
Market Committee and published on the Federal Reserve Bank of New York’s website, or if the
Federal Open Market Committee has not set a single rate, the mid-point of the
short-term interest rate target range set by the Federal Open Market Committee
and published on the Federal Reserve Bank of New York’s website (calculated as the
arithmetic average of the upper bound of the target range and the lower bound
of the target range).
(5)
If Daily
SOFR determined as above would be less than zero, then such rate shall be
deemed to be zero.
Ninth: The charter of the Corporation is
hereby amended by adding the definitions for “SOFR Index Cessation Date” and “SOFR
Index Cessation Event” in the Articles Supplementary:
“SOFR Index Cessation Date” means, in
respect of a SOFR Index Cessation Event, the date on which the Federal Reserve
Bank of New York (or any successor administrator of the secured overnight
financing rate) ceases to publish the secured overnight financing rate or the
date as of which the secured overnight financing rate may no longer be used.
“SOFR Index Cessation Event” means the
occurrence of one or more of the following events as it relates to Daily SOFR:
(1)
a public statement by the Federal Reserve Bank of New York
(or a successor administrator of the secured overnight financing rate)
announcing that it has ceased to publish or provide the secured overnight
financing rate permanently or indefinitely, provided that, at that time, there
is no successor administrator that will continue to publish or provide a
secured overnight financing rate; or
(2)
the publication of information which reasonably confirms
that the Federal Reserve Bank of New York (or a successor administrator of the
secured overnight financing rate) has ceased to provide the secured overnight
financing rate permanently or indefinitely, provided that, at that time, there
is no successor administrator that will continue to publish or provide the secured
overnight financing rate.
Tenth: The charter of the Corporation is
hereby amended by adding the definitions for “OBFR”, “OBFR Index Cessation Date”,
and “OBFR Index Cessation Event” in the Articles Supplementary:
“OBFR” means, with respect to any Business
Day, the Overnight Bank Funding Rate on the Federal Reserve Bank of New York’s
website as of 4:00 p.m., New York City time.
“OBFR Index Cessation
Date” means, in respect of an OBFR Index Cessation Event, the date on which
the Federal Reserve Bank of New York (or any successor administrator of the
OBFR), ceases to publish the OBFR, or the date as of which the OBFR may no
longer be used.
“OBFR Index Cessation Event” means the
occurrence of one or more of the following events:
(1)
a public statement by the Federal Reserve Bank of New York
(or a successor administrator of the OBFR) announcing that it has ceased to
publish or provide the OBFR permanently or indefinitely, provided that, at that
time, there is no successor administrator that will continue to publish or
provide an OBFR; or
(2)
the publication of information which reasonably confirms
that the Federal Reserve Bank of New York (or a successor administrator of the
OBFR) has ceased to provide the OBFR permanently or indefinitely, provided
that, at that time, there is no successor administrator that will continue to
publish or provide the OBFR.
Eleventh: The charter of the Corporation
is hereby amended by deleting the definition of “Substitute LIBOR Dealer” in
the Articles Supplementary.
Twelfth: These Articles of Amendment
shall be effective as of December 1, 2022.
Thirteenth:
The amendment to the charter of the Corporation as set forth above in these
Articles of Amendment has been duly advised by the board of directors of the
Corporation and approved by the stockholders of the Corporation as and to the
extent required by law and in accordance with the charter of the Corporation.
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IN WITNESS WHEREOF, BlackRock MuniHoldings Quality Fund
II, Inc. has caused these Articles of Amendment to be signed as of November 29,
2022 in its name and on its behalf by the person named below who acknowledges
that these Articles of Amendment are the act of the Corporation and, to the
best of such person’s knowledge, information and belief and under penalties for
perjury, all matters and facts contained in these Articles of Amendment are
true in all material respects.
BlackRock MuniHoldings Quality Fund II, Inc.
By: /s/ Jonathan Diorio
Name: Jonathan Diorio
Title: Vice President
ATTEST:
/s/ Janey Ahn
Name: Janey Ahn
Title: Secretary
[Signature Page to
Amendment to Articles Supplementary – MUE]
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the
Shareholders and the Board of Trustees of BlackRock California Municipal Income
Trust, BlackRock Municipal 2030 Target Term Trust, BlackRock MuniHoldings
California Quality Fund, Inc., and BlackRock MuniHoldings Quality Fund II,
Inc.:
In
planning and performing our audits of the financial statements of BlackRock
California Municipal Income Trust, BlackRock Municipal 2030 Target Term Trust,
BlackRock MuniHoldings California Quality Fund, Inc., and BlackRock
MuniHoldings Quality Fund II, Inc. (the “Funds”) as of and for the year ended July 31,
2023, in accordance with the standards of the Public Company Accounting
Oversight Board (United States) (PCAOB), we considered the Funds’ internal
control over financial reporting, including controls over safeguarding
securities, as a basis for designing our auditing procedures for the purpose of
expressing our opinion on the financial statements and to comply with the
requirements of Form N-CEN, but not for the purpose of expressing an opinion on
the effectiveness of the Funds’ internal control over financial reporting.
Accordingly, we express no such opinion.
The management of the Funds is responsible for
establishing and maintaining effective internal control over financial
reporting. In fulfilling this responsibility, estimates and judgments by
management are required to assess the expected benefits and related costs of
controls. A company's internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company's internal
control over financial reporting includes those policies and procedures that
(1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets
of the company; (2) provide reasonable assurance that transactions are recorded
as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management
and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of a company's assets that could have a material effect on the financial
statements.
Because of its inherent limitations, internal control
over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions
or that the degree of compliance with the policies or procedures may
deteriorate.
A deficiency in internal control over financial
reporting exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned
functions, to prevent or detect misstatements on a timely basis. A material
weakness is a deficiency, or a combination of deficiencies, in internal control
over financial reporting, such that there is a reasonable possibility that a
material misstatement of the company’s annual or interim financial statements
will not be prevented or detected on a timely basis.
Our consideration of the Funds’ internal control over
financial reporting was for the limited purpose described in the first
paragraph and would not necessarily disclose all deficiencies in internal
control that might be material weaknesses under standards established by the
PCAOB. However, we noted no deficiencies in the Funds’ internal control over
financial reporting and its operation, including controls over safeguarding securities,
that we consider to be a material weakness, as defined above, as of July 31, 2023.
This report is intended solely for the information and
use of management and the Board of Trustees of the Funds and the Securities and
Exchange Commission and is not intended to be and should not be used by anyone
other than these specified parties.
/s/Deloitte & Touche
LLP
Boston, Massachusetts
September 22, 2023
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