N-CSR

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-08603

Name of Fund: BlackRock Debt Strategies Fund, Inc. (DSU)

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: Anne F. Ackerley, Chief Executive Officer, BlackRock Debt Strategies Fund, Inc., 55 East 52^nd Street, New York, NY 10055.

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 02/28/2010

Date of reporting period: 02/28/2010

Item 1 – Report to Stockholders

Annual Report
FEBRUARY 28, 2010

BlackRock Corporate High Yield Fund, Inc. (COY)

BlackRock Corporate High Yield Fund III, Inc. (CYE)

BlackRock Debt Strategies Fund, Inc. (DSU)

BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)

BlackRock Senior High Income Fund, Inc. (ARK)

NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE

Table of Contents

	Page
Dear Shareholder	3
Annual Report:
Fund Summaries	4
The Benefits and Risks of Leveraging	9
Derivative Financial Instruments	9
Financial Statements:
Schedules of Investments	10
Statements of Assets and Liabilities	48
Statements of Operations	49
Statements of Changes in Net Assets	50
Statements of Cash Flows	52
Financial Highlights	53
Notes to Financial Statements	58
Report of Independent Registered Public Accounting Firm	67
Important Tax Information (Unaudited)	67
Automatic Dividend Reinvestment Plans	68
Officers and Directors	69
Additional Information	72

2 ANNUAL REPORT FEBRUARY 28, 2010

Dear Shareholder

The past year marked a pivotal turning point for global markets as the Great Recession that started in December 2007 began to recede and give way to recovery. The dramatic about-face could be attributed to a confluence of factors, most notably the extraordinary policy actions of global governments and central banks, a resurgence in corporate profits and growing signs of stability and healing in world economies.

After reaching a trough in early March 2009, stocks galloped higher as investors were lured back into the markets by depressed valuations, desire for higher yields and increasing confidence that all-out financial disaster had been averted. The result was a powerful upswing in global equities and other higher-risk assets through the end of 2009. More recently, the combination of mixed economic data, lingering deflation issues (especially in Europe) and proposed fees and levies on banks dampened investor conviction, resulting in a several-week bout of profit-taking. The selloff had a more pronounced negative effect on international and emerging market equities due primarily to concerns of higher interest rates in Asia and negative headlines out of Europe, particularly in Greece.

Generally speaking, investors’ renewed affinity for risk was notable in the fixed income markets as well, where non-Treasury assets made a robust recovery. One of the major themes in 2009 was the reversal of the flight-to-quality trade. High yield, one of the most battered areas during the financial crisis, emerged as the strongest-performing fixed income sector in both the taxable and tax-exempt space. Despite weak fundamentals, the municipal market produced solid returns as technical conditions remained supportive of the asset class. Municipal bond mutual funds enjoyed strong inflows and tax-exempt issuance remained low thanks to the ever-increasing popularity of the Build America Bond program. Nevertheless, state and local fiscal woes and bankruptcy fears remain firmly in the spotlight, and bear close monitoring.

At the same time, yields on money market securities declined throughout the reporting period and remain near all-time lows, with the Federal Open Market Committee reiterating that economic circumstances are likely to necessitate an accommodative interest rate stance for an “extended period.” Investor assets in money market funds declined from the peak registered in early 2009, but remain above levels registered prior to the financial crisis that began in 2007.

Against this backdrop, the major market averages posted the following returns:

Total Returns as of February 28, 2010	6-month		12-month
US equities (S&P 500 Index)	9.32	%	53.62	%
Small cap US equities (Russell 2000 Index)	10.59		63.95
International equities (MSCI Europe, Australasia, Far East Index)	0.72		54.58
3-month Treasury bill (BofA Merrill Lynch 3-Month Treasury Bill Index)	0.07		0.20
US Treasury securities (BofA Merrill Lynch 10-Year US Treasury Index)	0.07		(1.54	)
Taxable fixed income (Barclays Capital US Aggregate Bond Index)	3.19		9.32
Tax-exempt fixed income (Barclays Capital Municipal Bond Index)	4.13		9.98
High yield bonds (Barclays Capital US Corporate High Yield 2% Issuer Capped Index)	13.86		55.20

Past performance is no guarantee of future results. Index performance shown for illustrative purposes only. You cannot invest directly in an index.

The market continues to show signs of improvement, but questions about the strength and sustainability of the recovery abound. Through periods of uncertainty, as ever, BlackRock’s full resources are dedicated to the management of our clients’ assets. For additional market perspective and investment insight, visit www.blackrock.com/shareholdermagazine, where you’ll find the most recent issue of our award-winning Shareholder^® magazine, as well as its quarterly companion newsletter, Shareholder Perspectives. As always, we thank you for entrusting BlackRock with your investments, and we look forward to your continued partnership in the months and years ahead.

Sincerely,

Rob Kapito
President, BlackRock Advisors, LLC

THIS PAGE NOT PART OF YOUR FUND REPORT 3

Fund Summary as of February 28, 2010 BlackRock Corporate High Yield Fund, Inc.

Investment Objective

BlackRock Corporate High Yield Fund, Inc. (COY) (the “Fund”) seeks to provide shareholders with current income with a secondary objective of providing shareholders with capital appreciation. The Fund seeks to achieve its objectives by investing primarily in a diversified portfolio of fixed-income securities that are rated below investment grade by the established rating services (Ba or lower by Moody’s Investors Service, Inc. (“Moody’s”) or BB or lower by Standard & Poor’s Corporation (“S&P’s”)) or are unrated securities of comparable quality.

No assurance can be given that the Fund’s investment objective will be achieved.

Performance

For the 12 months ended February 28, 2010, the Fund returned 99.76% based on market price and 79.91% based on net asset value (“NAV”). For the same period, the closed-end Lipper High Current Yield Funds (Leveraged) category posted an average return of 86.36% on a market price basis and 68.03% on a NAV basis. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. During the period, we found particularly good value in the automotive segment, which represented the Fund’s largest sector overweight. As a group, automotive holdings performed quite well and, thus, were key contributors to performance. In addition, investments in select special situations or distressed credits (including several in the automotive sector) enhanced results. On a credit basis, the Fund’s underweight position in BB credits and overweight in the lower-quality ratings and nonrated credits were additive. On the other hand, the Fund held a 13% position in floating rate loan interests, which hindered performance as the sector underperformed high yield during the period. The Fund also maintained relatively low levels of leverage (at year end, 24% of the Fund’s total managed assets), which detracted from performance versus the Lipper competitors, who maintained leverage closer to the 33⅓% regulatory limit.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Fund Information

Symbol on New York Stock Exchange (“NYSE”)	COY
Initial Offering Date	June 25, 1993
Yield on Closing Market Price as of February 28, 2010 ($6.88)1	10.64%
Current Monthly Distribution per Share2	$0.061
Current Annualized Distribution per Share2	$0.732
Leverage as of February 28, 20103	24%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on March 1, 2010. The Monthly Distribution per Common Share was decreased to $0.051. The Yield on Closing Market Price, Current Monthly Distribution per Common Share and Current Annualized Distribution per Common Share do not reflect the new distribution rate. The new distribution rate is not constant and is subject to change.
3	Represents loan outstanding as a percentage of total managed assets, which is the total assets of the Fund (including any assets attributable to borrowing) minus the sum of liabilities (other than borrowings representing financial leverage). For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 9.

The table below summarizes the changes in the Fund’s market price and NAV per share:

	2/28/10			2/28/09			Change		High		Low
Market Price		$	6.88		$	3.91	75.96	%	$	7.10	$	3.20
Net Asset Value		$	6.64		$	4.19	58.47	%	$	6.74	$	3.97

The following unaudited charts show the portfolio composition of the Fund’s long-term investments and credit quality allocations of the Fund’s corporate bond investments:

Portfolio Composition

	2/28/10		2/28/09
Corporate Bonds	82	%	82	%
Floating Rate Loan Interests	13		16
Common Stocks	3		1
Other Interests	2		—
Non-Agency Mortgage-Backed Securities	—		1

Credit Quality Allocations⁴

	2/28/10		2/28/09
BBB/Baa	3	%	4	%
BB/Ba	30		31
B	46		47
CCC/Caa	12		12
CC/Ca	1		1
D	1		—
Not Rated	7		5
4          Using the higher of S&P’s or Moody’s ratings.

4 ANNUAL REPORT FEBRUARY 28, 2010

Fund Summary as of February 28, 2010 BlackRock Corporate High Yield Fund III, Inc.

Investment Objective

BlackRock Corporate High Yield Fund III, Inc. (CYE) (the “Fund”) seeks to provide shareholders with current income by investing primarily in a diversified portfolio of fixed income securities that are rated in the lower rating categories of the established rating services (Ba or lower by Moody’s or BB or lower by S&P’s) or are unrated securities of comparable quality.

No assurance can be given that the Fund’s investment objective will be achieved.

Performance

For the 12 months ended February 28, 2010, the Fund returned 111.12% based on market price and 86.65% based on NAV. For the same period, the closed-end Lipper High Current Yield Funds (Leveraged) category posted an average return of 86.36% on a market price basis and 68.03% on a NAV basis. All returns reflect reinvestment of dividends. The Fund’s discount to NAV, which narrowed during the period, accounts for the difference between performance based on price and performance based on NAV. During the period, we found particularly good value in the automotive segment, which represented the Fund’s largest sector overweight. As a group, automotive holdings performed quite well and, thus, were key contributors to performance. In addition, investments in select special situations or distressed credits (including several in the automotive sector) enhanced results. On a credit basis, the Fund’s underweight position in BB credits and overweight in the lower-quality ratings and nonrated credits were additive. On the other hand, the Fund held a 13% position in floating rate loan interests, which hindered performance as the sector underperformed high yield during the period. The Fund also maintained relatively low levels of leverage (at year end, 23% of the Fund’s total managed assets), which detracted from performance versus the Lipper competitors, who maintained leverage closer to the 33⅓% regulatory limit.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Fund Information

Symbol on NYSE	CYE
Initial Offering Date	January 30, 1998
Yield on Closing Market Price as of February 28, 2010 ($6.67)1	9.90%
Current Monthly Distribution per Share2	$0.055
Current Annualized Distribution per Share2	$0.660
Leverage as of February 28, 20103	23%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	A change in the distribution rate was declared on March 1, 2010. The Monthly Distribution per Common Share was decreased to $0.050. The Yield on Closing Market Price, Current Monthly Distribution per Common Share and Current Annualized Distribution per Common Share do not reflect the new distribution rate. The new distribution rate is not constant and is subject to change.
3	Represents loan outstanding as a percentage of total managed assets, which is the total assets of the Fund (including any assets attributable to borrowing) minus the sum of liabilities (other than borrowings representing financial leverage). For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 9.

The table below summarizes the changes in the Fund’s market price and NAV per share:

	2/28/10			2/28/09			Change		High		Low
Market Price		$	6.67		$	3.57	86.83	%	$	6.78	$	3.05
Net Asset Value		$	6.69		$	4.05	65.19	%	$	6.78	$	3.83

The following unaudited charts show the portfolio composition of the Fund’s long-term investments and credit quality allocations of the Fund’s corporate bond investments:

Portfolio Composition

	2/28/10		2/28/09
Corporate Bonds	81	%	82	%
Floating Rate Loan Interests	13		16
Common Stocks	4		1
Other Interests	2		—
Non-Agency Mortgage-Backed Securities	—		1

Credit Quality Allocations⁴

	2/28/10		2/28/09
AAA/Aaa	—	%	1	%
BBB/Baa	3		5
BB/Ba	29		30
B	47		46
CCC/Caa	12		14
CC/Ca	—		1
D	1		—
Not Rated	8		3
4           Using the higher of S&P’s or Moody’s ratings.

ANNUAL REPORT FEBRUARY 28, 2010 5

Fund Summary as of February 28, 2010 BlackRock Debt Strategies Fund, Inc.

Investment Objective

BlackRock Debt Strategies Fund, Inc. (DSU) (the “Fund”) seeks to provide current income by investing primarily in a diversified portfolio of US companies’ debt instruments, including corporate loans, that are rated in the lower rating categories of the established rating services (Baa or lower by Moody’s or BBB or lower by S&P’s) or unrated debt instruments of comparable quality.

No assurance can be given that the Fund’s investment objective will be achieved.

Performance

For the 12 months ended February 28, 2010, the Fund returned 114.32% based on market price and 87.82% based on NAV. For the same period, the closed-end Lipper High Current Yield Funds (Leveraged) category posted an average return of 86.36% on a market price basis and 68.03% on a NAV basis. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. Unlike most of the other funds in its Lipper category, the Fund is a hybrid that invests in both high yield and bank loans. During the period, approximately 47% of the Fund was invested in floating rate loan interests, with 42% in high yield and the remainder in common stock, convertibles and investment-grade bonds. The Fund continued to outperform its Lipper category, even though loans underperformed high yield over the 12 months. Contributing positively to performance were the Fund’s overweight positions in autos and several distressed credits and special situations, as well as our underweight in health care. On an individual security and credit rating basis, we tended to be overweight in the lower-quality tiers, nonrated and higher-beta credits, which hurt the Fund’s performance in 2008, but has benefited the Fund since. On the other hand, the Fund maintained relatively conservative sector positioning, which had a negative impact on the Fund’s performance in the continuation of the market’s sharp rebound from 2008; still, we believe the Fund’s positioning is the correct stance for the medium term. The Fund also maintained relatively low levels of leverage (at year end, 14% of the Fund’s total managed assets), which has been a detractor in a strong market environment.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Fund Information

Symbol on NYSE	DSU
Initial Offering Date	March 27, 1998
Yield on Closing Market Price as of February 28, 2010 ($3.91)1	9.51%
Current Monthly Distribution per Share2	$0.031
Current Annualized Distribution per Share2	$0.372
Leverage as of February 28, 20103	14%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution rate is not constant and is subject to change.
3	Represents loan outstanding as a percentage of total managed assets, which is the total assets of the Fund (including any assets attributable to borrowing) minus the sum of liabilities (other than borrowings representing financial leverage). For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 9.

The table below summarizes the changes in the Fund’s market price and NAV per share:

	2/28/10		2/28/09		Change			High		Low
Market Price	$	3.91	$	2.07		88.89	%	$	3.91	$	1.63
Net Asset Value	$	3.89	$	2.35		65.53	%	$	3.90	$	2.21

The following unaudited charts show the portfolio composition of the Fund’s long-term investments and credit quality allocations of the Fund’s corporate bond investments:

Portfolio Composition

	2/28/10		2/28/09
Corporate Bonds	49	%	53	%
Floating Rate Loan Interests	47		43
Common Stocks	4		3
Non-Agency Mortgage-Backed Securities	—		1

Credit Quality Allocations⁴

	2/28/10		2/28/09
BBB/Baa	5	%	9	%
BB/Ba	27		—
B	44		59
CCC/Caa	11		21
CC/Ca	—		4
D	1		1
Not Rated	12		6

⁴ Using the higher of S&P’s or Moody’s ratings.

6 ANNUAL REPORT FEBRUARY 28, 2010

Fund Summary as of February 28, 2010 BlackRock Floating Rate Income Strategies Fund II, Inc.

Investment Objective

BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB) (the “Fund”) seeks a high current income and such preservation of capital as is consistent with investment in a diversified, leveraged portfolio consisting primarily of floating rate debt securities and instruments.

No assurance can be given that the Fund’s investment objective will be achieved.

Performance

For the 12 months ended February 28, 2010, the Fund returned 99.15% based on market price and 62.08% based on NAV. For the same period, the closed-end Lipper Loan Participation Funds category posted an average return of 98.84% on a market price basis and 55.06% on a NAV basis. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. During the period, approximately 20% of the Fund was invested in high yield bonds, which contributed positively to performance as high yield outperformed floating rate loan interests. Overweight positions in the automotive sector and a few special situations and distressed credits also helped the Fund’s results, as did an underweight in health care. On the other hand, the Fund generally favored less economically sensitive sectors and higher-quality credits, which detracted from performance as these issues underperformed lower-rated issues and those sectors with greater economic sensitivity. In addition, the Fund maintained relatively conservative levels of leverage (at year end, 15% of the Fund’s total managed assets), which was a detractor versus the Lipper competitors, who maintained leverage closer to the 33⅓% regulatory limit.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Fund Information

Symbol on NYSE	FRB
Initial Offering Date	July 30, 2004
Yield on Closing Market Price as of February 28, 2010 ($15.01)1	6.00%
Current Monthly Distribution per Share2	$0.075
Current Annualized Distribution per Share2	$0.900
Leverage as of February 28, 20103	15%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution rate is not constant and is subject to change.
3	Represents loan outstanding as a percentage of total managed assets, which is the total assets of the Fund (including any assets attributable to borrowing) minus the sum of liabilities (other than borrowings representing financial leverage). For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 9.

The table below summarizes the changes in the Fund’s market price and NAV per share:

	2/28/10		2/28/09		Change			High		Low
Market Price	$	15.01	$	8.28		81.28	%	$	15.10	$	7.16
Net Asset Value	$	13.16	$	8.92		47.53	%	$	13.21	$	8.58

The following unaudited charts show the portfolio composition of the Fund’s long-term investments and credit quality allocations of the Fund’s corporate bond investments:

Portfolio Composition

	2/28/10		2/28/09
Floating Rate Loan Interests	73	%	71	%
Corporate Bonds	26		28
Other Interests	1		—
Non-Agency Mortgage-Backed Securities	—		1

Credit Quality Allocations⁴

	2/28/10		2/28/09
BBB/Baa	6	%	15	%
BB/Ba	34		8
B	38		57
CCC/Caa	10		15
CC/Ca	1		2
D	2		1
Not Rated	9		2

⁴ Using the higher of S&P’s or Moody’s ratings.

ANNUAL REPORT FEBRUARY 28, 2010 7

Fund Summary as of February 28, 2010 BlackRock Senior High Income Fund, Inc.

Investment Objective

BlackRock Senior High Income Fund, Inc. (ARK) (the “Fund”) seeks to provide shareholders with as high a level of current income as is consistent with its investment policies and prudent investment management by investing principally in senior debt obligations of companies, including corporate loans made by banks and other financial institutions and both privately placed and publicly offered corporate bonds and notes.

No assurance can be given that the Fund’s investment objective will be achieved.

Performance

For the 12 months ended February 28, 2010, the Fund returned 95.61% based on market price and 68.90% based on NAV. For the same period, the closed-end Lipper High Current Yield Funds (Leveraged) category posted an average return of 86.36% on a market price basis and 68.03% on a NAV basis. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. Unlike most of the other funds in its Lipper category, the Fund is a hybrid that invests in both high yield and bank loans. During the period, approximately 46% of the Fund was invested in floating rate loan interests, with 48% in high yield and the remainder in common stock, convertibles and investment-grade bonds. The Fund outperformed its Lipper category, even though loans underperformed high yield over the 12 months. Contributing positively to performance were our overweight positions in autos and several distressed credits and special situations, as well as the Fund’s underweight in health care. On an individual security and credit rating basis, the Fund tended to be overweight in the lower-quality tiers, nonrated and higher-beta credits, which hurt performance in 2008, but has benefited the Fund since. On the other hand, the Fund maintained relatively conservative sector positioning, which had a negative impact on performance in the continuation of the market’s sharp rebound from 2008; still, we believe the Fund’s positioning is the correct stance for the medium term. We also maintained relatively low levels of leverage (at year end, 16% of the Fund’s total assets), which has been a detractor in a strong market environment.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Fund Information

Symbol on NYSE	ARK
Initial Offering Date	April 30, 1993
Yield on Closing Market Price as of February 28, 2010 ($3.94)1	7.61%
Current Monthly Distribution per Common Share2	$0.025
Current Annualized Distribution per Common Share2	$0.300
Leverage as of February 28, 20103	16%

1	Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
2	The distribution is not constant and is subject to change.
3	Represents loan outstanding as a percentage of total managed assets, which is the total assets of the Fund (including any assets attributable to borrowing) minus the sum of liabilities (other than borrowings representing financial leverage). For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 9.

The table below summarizes the changes in the Fund’s market price and NAV per share:

	2/28/10		2/28/09		Change			High		Low
Market Price	$	3.94	$	2.21		78.28	%	$	3.97	$	1.78
Net Asset Value	$	3.91	$	2.54		53.94	%	$	3.93	$	2.41

The following unaudited charts show the portfolio composition of the Fund’s long-term investments and credit quality allocations of the Fund’s corporate bond investments:

Portfolio Composition

	2/28/10		2/28/09
Corporate Bonds	52	%	55	%
Floating Rate Loan Interests	46		44
Common Stocks	2		—
Non-Agency Mortgage-Backed Securities	—		1

Credit Quality Allocations⁴

	2/28/10		2/28/09
BBB/Baa	5	%	2	%
BB/Ba	33		22
B	43		59
CCC/Caa	11		8
CC/Ca	—		3
D	1		1
Not Rated	7		5

⁴ Using the higher of S&P’s or Moody’s ratings.

8 ANNUAL REPORT FEBRUARY 28, 2010

The Benefits and Risks of Leveraging

The Funds may utilize leverage to seek to enhance the yield and NAV. However, these objectives cannot be achieved in all interest rate environments.

The Funds may utilize leverage by borrowing through a credit facility. In general, the concept of leveraging is based on the premise that the cost of assets to be obtained from leverage will be based on short-term interest rates, which normally will be lower than the income earned by each Fund on its longer-term portfolio investments. To the extent that the total assets of each Fund (including the assets obtained from leverage) are invested in higher-yielding portfolio investments, each Fund’s shareholders will benefit from the incremental net income.

The interest earned on securities purchased with the proceeds from leverage is paid to shareholders in the form of dividends, and the value of these portfolio holdings is reflected in the per share NAV. However, in order to benefit shareholders, the yield curve must be positively sloped; that is, short-term interest rates must be lower than long-term interest rates. If the yield curve becomes negatively sloped, meaning short-term interest rates exceed long-term interest rates, income to shareholders will be lower than if the Funds had not used leverage.

To illustrate these concepts, assume a Fund’s capitalization is $100 million and it issues debt securities for an additional $30 million, creating a total value of $130 million available for investment in long-term securities. If prevailing short-term interest rates are 3% and long-term interest rates are 6%, the yield curve has a strongly positive slope. In this case, the Fund pays interest expense on the $30 million of debt securities based on the lower short-term interest rates. At the same time, the securities purchased by the Fund with assets received from borrowings earn the income based on long-term interest rates. In this case, the interest expense of borrowings is significantly lower than the income earned on the Fund’s long-term investments, and therefore the shareholders are the beneficiaries of the incremental net income.

If short-term interest rates rise, narrowing the differential between short-term and long-term interest rates, the incremental net income pickup will be reduced or eliminated completely. Furthermore, if prevailing short-term interest rates rise above long-term interest rates of 6%, the yield curve has a negative slope. In this case, the Fund pays interest expense on the higher short-term interest rates whereas the Fund’s total portfolio earns income based on lower long-term interest rates.

Furthermore, the value of the Fund’s portfolio investments generally varies inversely with the direction of long-term interest rates, although other factors can influence the value of portfolio investments. In contrast, the redemption value of the Fund’s borrowings do not fluctuate in relation to interest rates. As a result, changes in interest rates can influence the Fund’s NAV positively or negatively in addition to the impact on Fund performance from leverage from borrowings.

The use of leverage may enhance opportunities for increased income to the Funds and shareholders, but as described above, it also creates risks as short- or long-term interest rates fluctuate. Leverage also will generally cause greater changes in each Fund’s NAV, market price and dividend rate than a comparable portfolio without leverage. If the income derived from securities purchased with assets received from leverage exceeds the cost of leverage, each Fund’s net income will be greater than if leverage had not been used. Conversely, if the income from the securities purchased is not sufficient to cover the cost of leverage, each Fund’s net income will be less than if leverage had not been used, and therefore the amount available for distribution to shareholders will be reduced. Each Fund may be required to sell portfolio securities at inopportune times at distressed values in order to comply with regulatory requirements applicable to the use of leverage or as required by the terms of leverage instruments, which may cause a Fund to incur losses. The use of leverage may limit each Fund’s ability to invest in certain types of securities or use certain types of hedging strategies. Each Fund will incur expenses in connection with the use of leverage, all of which are borne by the shareholders and may reduce income.

Under the Investment Company Act of 1940, the Funds are permitted to borrow through a credit facility up to 33⅓% of their total managed assets. As of February 28, 2010, the Funds had outstanding leverage from credit facility borrowings as a percentage of their total managed assets as follows:

	Percent of Leverage
COY	24	%
CYE	23	%
DSU	14	%
FRB	15	%
ARK	16	%

Derivative Financial Instruments

The Funds may invest in various derivative instruments, including swaps, foreign currency exchange contracts and options, as specified in Note 2 of the Notes to Financial Statements, which constitute forms of economic leverage. Such instruments are used to obtain exposure to a market without owning or taking physical custody of securities or to hedge market, equity, credit and/or foreign currency exchange rate risks. Such derivative instruments involve risks, including the imperfect correlation between the value of a derivative instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the derivative instrument.

The Funds’ ability to successfully use a derivative instrument depends on the investment advisor’s ability to accurately predict pertinent market movements, which cannot be assured. The use of derivative instruments may result in losses greater than if they had not been used, may require a Fund to sell or purchase portfolio securities at inopportune times or for distressed values, may limit the amount of appreciation a Fund can realize on an investment or may cause a Fund to hold a security that they might otherwise sell. The Funds’ investments in these instruments are discussed in detail in the Notes to Financial Statements.

ANNUAL REPORT FEBRUARY 28, 2010 9

Schedule of Investments February 28, 2010	BlackRock Corporate High Yield Fund, Inc. (COY)
	(Percentages shown are based on Net Assets)

Common Stocks	Shares		Value
Auto Components — 0.1%
Lear Corp. (a)		3,958	$	274,171
Building Products — 0.7%
Masonite Worldwide Holdings (a)		35,518		1,491,756
Capital Markets — 0.2%
E*Trade Financial Corp. (a)		269,000		433,090
Chemicals — 0.0%
Wellman Holdings, Inc. (a)		1,425		356
Communications Equipment — 0.9%
Brocade Communications Systems, Inc. (a)		45,000		261,900
Loral Space & Communications Ltd. (a)		58,901		1,916,050
				2,177,950
Construction Materials — 0.0%
Nortek, Inc. (a)		2,020		74,740
Containers & Packaging — 0.2%
Rock-Tenn Co., Class A		12,000		502,080
Smurfit Kappa Plc (a)		3,634		29,954
				532,034
Diversified Financial Services — 0.4%
Bank of America Corp.		60,000		999,600
Diversified Telecommunication Services — 0.5%
Qwest Communications International, Inc.		229,998		1,048,791
Electrical Equipment — 0.0%
Medis Technologies Ltd. (a)		67,974		4,826
SunPower Corp., Class B (a)		352		5,748
				10,574
Food Products — 0.0%
Pilgrims Pride Corp. (a)		6,449		58,170
Household Durables — 0.2%
Beazer Homes USA, Inc. (a)		22,188		92,302
Pulte Homes, Inc. (a)		28,000		303,240
				395,542
Machinery — 0.1%
Accuride Corp. (a)		84,388		109,704
Accuride Corp. — Restricted Shares (a)		84,389		109,706
				219,410
Media — 0.3%
Gannett Co., Inc.		45,000		681,750
Paper & Forest Products — 0.1%
Ainsworth Lumber Co. Ltd. (a)		37,144		78,016
Ainsworth Lumber Co. Ltd. (a)(b)		41,686		87,555
Western Forest Products, Inc. (a)		147,968		30,938
Western Forest Products, Inc. (a)(b)		41,528		8,683
				205,192
Wireless Telecommunication Services — 0.3%
FiberTower Corp. (a)		76,542		315,354
SBA Communications Corp., Class A (a)		8,500		300,560
				615,914
Total Common Stocks — 4.0%				9,219,040

Corporate Bonds	Par  (000)		Value
Airlines — 2.4%
American Airlines, Inc., 10.50%, 10/15/12 (b)	USD	940	$	963,500
American Airlines Pass Through Trust, Series 2001-02, 7.86%, 4/01/13		390		392,925
Continental Airlines, Inc.:
Series 1997-4-B, 6.90%, 7/02/18		503		462,977
Series 2001-1-C, 7.03%, 12/15/12		270		262,771
Series 2003-RJ, 7.88%, 1/02/20		389		345,822
Delta Air Lines, Inc., Series B, 9.75%, 12/17/16		975		1,004,250
United Air Lines, Inc., 12.75%, 7/15/12		2,000		2,120,000
				5,552,245
Auto Components — 0.8%
Delphi International Holdings Unsecured, 12.00%, 10/06/14		41		40,674
The Goodyear Tire & Rubber Co.:
7.86%, 8/15/11		1,125		1,164,375
8.63%, 12/01/11		612		634,950
				1,839,999
Biotechnology — 0.3%
QHP Pharma, 10.25%, 3/15/15 (b)		700		714,616
Building Products — 1.1%
Associated Materials LLC, 9.88%, 11/15/16		660		699,600
Building Materials Corp. of America, 7.00%, 2/15/20 (b)		570		570,000
Goodman Global Group, Inc., 12.86%, 12/15/14 (b)(c)		280		162,400
Ply Gem Industries, Inc., 11.75%, 6/15/13		1,050		1,065,750
				2,497,750
Capital Markets — 0.4%
E*Trade Financial Corp., 3.43% 8/31/19 (b)(c)(d)		226		343,520
Marsico Parent Co., LLC, 10.63%, 1/15/16 (b)		904		543,530
Marsico Parent Holdco, LLC, 12.50%, 7/15/16 (b)(e)		385		85,094
Marsico Parent Superholdco, LLC, 14.50%, 1/15/18 (b)(e)		248		43,018
				1,015,162
Chemicals — 2.8%
American Pacific Corp., 9.00%, 2/01/15		800		790,000
Georgia Gulf Corp., 9.00%, 1/15/17 (b)		215		223,063
Hexion Finance Escrow LLC, 8.88%, 2/01/18 (b)		1,685		1,575,475
Hexion U.S. Finance Corp., 9.75%, 11/15/14		285		269,325
Huntsman International LLC (b):
6.88%, 11/15/13	EUR	260		330,133
5.50%, 6/30/16	USD	510		448,800
Innophos, Inc., 8.88%, 8/15/14		740		760,350
MacDermid, Inc., 9.50%, 4/15/17 (b)		1,180		1,180,000
Wellman Holdings, Inc. (d):
Second Lien Subordinate Note, 10.00%, 1/29/19 (b)		790		790,000
Third Lien Subordinate Note, 5.00%, 1/29/19 (e)		252		126,361
				6,493,507

Portfolio Abbreviations
To simplify the listings of portfolio holdings in the Schedules of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list:
CAD	Canadian Dollar
EUR	Euro
GBP	British Pound
USD	US Dollar

See Notes to Financial Statements.
10	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund, Inc. (COY)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par  (000)	Value
Commercial Services & Supplies — 3.2%
ACCO Brands Corp., 10.63%, 3/15/15 (b)	USD	480	$	521,760
RSC Equipment Rental, Inc., 10.00%, 7/15/17 (b)		555		593,850
Scientific Games International, Inc., 9.25%, 6/15/19		785		830,137
Waste Services, Inc., 9.50%, 4/15/14		2,800		2,877,000
West Corp.:
9.50%, 10/15/14		400		397,000
11.00%, 10/15/16		2,040		2,045,100
				7,264,847
Construction Materials — 1.2%
Nortek, Inc., 11.00%, 12/01/13		2,029		2,130,426
Texas Industries, Inc., 7.25%, 7/15/13		720		700,200
				2,830,626
Consumer Finance — 0.5%
Credit Acceptance Corp., 9.13%, 2/01/17 (b)		640		636,800
Ford Motor Credit Co. LLC:
3.00%, 1/13/12 (f)		195		182,813
7.80%, 6/01/12		200		202,114
8.00%, 12/15/16		170		170,703
				1,192,430
Containers & Packaging — 4.1%
Berry Plastics Escrow LLC, 8.88%, 9/15/14 (b)		440		423,500
Berry Plastics Holding Corp., 8.88%, 9/15/14		1,000		962,500
Crown European Holdings SA, 6.25%, 9/01/11	EUR	73		101,389
Graphic Packaging International, Inc., 9.50%, 6/15/17	USD	810		850,500
Impress Holdings BV, 3.38%, 9/15/13 (b)(f)		390		363,675
Owens-Brockway Glass Container, Inc.:
8.25%, 5/15/13		925		938,875
6.75%, 12/01/14	EUR	152		206,972
Packaging Dynamics Finance Corp., 10.00%, 5/01/16 (b)	USD	1,010		804,212
Pregis Corp., 12.38%, 10/15/13		1,130		1,121,525
Rock-Tenn Co., 8.20%, 8/15/11		1,875		2,020,312
Smurfit Kappa Acquisitions (b):
7.25%, 11/15/17	EUR	465		620,507
7.75%, 11/15/19		440		596,133
Solo Cup Co., 10.50%, 11/01/13	USD	450		471,375
				9,481,475
Diversified Consumer Services — 1.2%
Service Corp. International, 7.00%, 6/15/17		2,800		2,744,000
Diversified Financial Services — 8.7%
Axcan Intermediate Holdings, Inc., 12.75%, 3/01/16		490		530,425
CIT Group, Inc., 7.00%, 5/01/17		6,615		5,846,006
FCE Bank Plc:
7.88%, 2/15/11	GBP	1,150		1,766,681
7.13%, 1/16/12	EUR	1,450		1,957,026
7.13%, 1/15/13		550		733,933
GMAC LLC:
7.25%, 3/02/11	USD	578		583,058
6.88%, 9/15/11		500		500,000
6.88%, 8/28/12		600		594,000
2.45%, 12/01/14 (f)		441		377,274
6.75%, 12/01/14		950		907,250
8.30%, 2/12/15 (b)		2,140		2,158,725
8.00%, 11/01/31		1,200		1,107,000

Corporate Bonds		Par  (000)	Value
Diversified Financial Services (concluded)
Leucadia National Corp., 8.13%, 9/15/15	USD	1,250	$	1,268,750
Reynolds Group DL Escrow, Inc., 7.75%, 10/15/16 (b)		1,340		1,356,750
Reynolds Group Issuer, Inc., 7.75%, 10/15/16 (b)	EUR	350		475,393
				20,162,271
Diversified Telecommunication Services — 3.9%
Broadview Networks Holdings, Inc., 11.38%, 9/01/12	USD	1,000		960,000
GCI, Inc., 8.63%, 11/15/19 (b)		1,100		1,117,875
Level 3 Financing, Inc., 10.00%, 2/01/18 (b)		630		578,025
Nordic Telephone Co. Holdings ApS, 8.88%, 5/01/16 (b)		200		214,000
Qwest Communications International, Inc.:
7.50%, 2/15/14		1,890		1,908,900
8.00%, 10/01/15 (b)		500		517,500
Series B, 7.50%, 2/15/14		1,645		1,661,450
Qwest Corp.:
7.63%, 6/15/15		500		534,375
8.38%, 5/01/16		650		711,750
Windstream Corp., 8.13%, 8/01/13		700		728,000
				8,931,875
Electric Utilities — 1.3%
Intergen NV, 9.00%, 6/30/17 (b)		385		392,700
NSG Holdings LLC, 7.75%, 12/15/25 (b)		965		834,725
Tenaska Alabama Partners LP, 7.00%, 6/30/21 (b)		1,684		1,687,163
				2,914,588
Electronic Equipment, Instruments & Components — 0.1%
Jabil Circuit, Inc., 7.75%, 7/15/16		280		289,800
Energy Equipment & Services — 1.4%
Compagnie Générale de Géophysique-Veritas:
7.50%, 5/15/15		195		191,100
7.75%, 5/15/17		300		294,000
Expro Finance Luxembourg SCA, 8.50%, 12/15/16 (b)		1,715		1,706,425
North American Energy Alliance LLC, 10.88%, 6/01/16 (b)		625		662,500
North American Energy Partners, Inc., 8.75%, 12/01/11		355		353,225
				3,207,250
Food & Staples Retailing — 0.8%
AmeriQual Group LLC, 9.50%, 4/01/12 (b)		750		675,000
Duane Reade, Inc., 11.75%, 8/01/15		160		201,600
Rite Aid Corp.:
9.75%, 6/12/16		380		405,650
10.25%, 10/15/19		580		613,350
				1,895,600
Food Products — 0.7%
B&G Foods, Inc., 7.63%, 1/15/18		200		202,000
Reddy Ice Corp., 11.25%, 3/15/15 (b)(g)		410		410,000
Smithfield Foods, Inc., 10.00%, 7/15/14 (b)		760		822,700
TreeHouse Foods, Inc., 7.75%, 3/01/18 (g)		150		153,938
				1,588,638

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	11

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund, Inc. (COY)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par  (000)	Value
Health Care Equipment & Supplies — 1.3%
DJO Finance LLC:
10.88%, 11/15/14	USD	1,605	$	1,717,350
10.88%, 11/15/14 (b)		560		599,200
Hologic, Inc., 2.00%, 12/15/37 (d)(h)		910		778,050
				3,094,600
Health Care Providers & Services — 3.6%
Community Health Systems, Inc., Series WI, 8.88%, 7/15/15		1,360		1,407,600
HCA, Inc., 9.13%, 11/15/14		1,645		1,729,306
LifePoint Hospitals, Inc., 3.50%, 5/15/14 (d)		100		91,625
Tenet Healthcare Corp. (b):
9.00%, 5/01/15		1,502		1,573,345
10.00%, 5/01/18		622		684,200
8.88%, 7/01/19		1,215		1,281,825
Vanguard Health Holding Co. LLC, 8.00%, 2/01/18 (b)		1,450		1,424,625
				8,192,526
Health Care Technology — 0.8%
IMS Health, Inc., 12.50%, 3/01/18 (b)		1,650		1,897,500
Hotels, Restaurants & Leisure — 3.8%
Greektown Holdings, LLC, 10.75%, 12/01/13 (a)(b)(i)		412		24,720
Harrah’s Operating Co., Inc., 11.25%, 6/01/17		1,025		1,063,437
Icahn Enterprises LP, 8.00%, 1/15/18 (b)		2,200		2,068,000
Inn of the Mountain Gods Resort & Casino, 12.00%, 11/15/10 (a)(i)		1,425		691,125
Little Traverse Bay Bands of Odawa Indians, 10.25%, 2/15/14 (a)(b)(i)		1,175		296,687
MGM Mirage:
13.00%, 11/15/13		1,045		1,191,300
10.38%, 5/15/14 (b)		235		249,100
11.13%, 11/15/17 (b)		780		842,400
Pinnacle Entertainment, Inc., 8.63%, 8/01/17 (b)		640		608,000
San Pasqual Casino, 8.00%, 9/15/13 (b)		925		878,750
Scientific Games Corp., 0.75%, 12/01/24 (d)(h)		270		262,238
Shingle Springs Tribal Gaming Authority, 9.38%, 6/15/15 (b)		45		35,775
Travelport LLC:
4.88%, 9/01/14 (f)		145		134,850
9.88%, 9/01/14		190		194,275
Tropicana Entertainment LLC, Series WI, 9.63%, 12/15/14 (a)(i)		315		197
Virgin River Casino Corp., 9.00%, 1/15/12 (a)(i)		805		152,950
				8,693,804
Household Durables — 2.5%
Beazer Homes USA, Inc., 12.00%, 10/15/17 (b)		1,425		1,588,875
Jarden Corp., 8.00%, 5/01/16		240		250,800
K. Hovnanian Enterprises, Inc., 10.63%, 10/15/16		1,620		1,692,900
KB Home:
6.38%, 8/15/11		29		29,508
9.10%, 9/15/17		205		212,687
Standard Pacific Corp.:
6.25%, 4/01/14		485		436,500
7.00%, 8/15/15		325		292,500
10.75%, 9/15/16		1,130		1,178,025
				5,681,795

Corporate Bonds		Par  (000)	Value
Household Products — 0.1%
Libbey Glass, Inc., 10.00%, 2/15/15 (b)	USD	125	$	129,375
IT Services — 1.5%
Alliance Data Systems Corp., 1.75%, 8/01/13 (d)		1,585		1,466,125
First Data Corp.:
9.88%, 9/24/15 (b)		15		12,975
9.88%, 9/24/15		1,500		1,282,500
11.25%, 3/31/16		760		623,200
				3,384,800
Independent Power Producers & Energy Traders — 3.8%
The AES Corp., 8.75%, 5/15/13 (b)		994		1,011,395
AES Eastern Energy LP, Series 99-B, 9.67%, 1/02/29		575		623,156
Calpine Construction Finance Co. LP, 8.00%, 6/01/16 (b)		1,190		1,204,875
Energy Future Holdings Corp.:
10.88%, 11/01/17		400		303,000
11.25%, 11/01/17 (e)		2,738		1,916,516
10.00%, 1/15/20 (b)		1,715		1,749,300
NRG Energy, Inc., 7.25%, 2/01/14		2,010		2,025,075
				8,833,317
Industrial Conglomerates — 2.6%
Sequa Corp. (b):
11.75%, 12/01/15		2,190		2,146,200
13.50%, 12/01/15 (e)		3,759		3,768,149
				5,914,349
Insurance — 0.9%
Alliant Holdings I, Inc., 11.00%, 5/01/15 (b)		1,600		1,628,000
USI Holdings Corp., 4.13%, 11/15/14 (b)(f)		630		521,325
				2,149,325
Internet & Catalog Retail — 0.2%
NetFlix, Inc., 8.50%, 11/15/17 (g)		330		345,675
Internet Software & Services — 0.3%
Equinix, Inc, 8.13%, 3/01/18		570		570,000
Leisure Equipment & Products — 1.0%
Brunswick Corp., 11.25%, 11/01/16 (b)		1,870		2,080,375
Easton-Bell Sports, Inc., 9.75%, 12/01/16 (b)		265		274,938
				2,355,313
Life Sciences Tools & Services — 0.1%
Bio-Rad Laboratories, Inc., 8.00%, 9/15/16 (b)		200		209,000
Machinery — 1.2%
AGY Holding Corp., 11.00%, 11/15/14		900		720,000
Accuride Corp., 7.50%, 2/26/20 (d)(e)		9		14,773
Navistar International Corp.:
3.00%, 10/15/14 (d)		480		490,800
8.25%, 11/01/21		1,000		1,015,000
RBS Global, Inc., 8.88%, 9/01/16		420		380,100
Titan International, Inc., 5.63%, 1/15/17 (b)(d)		220		231,550
				2,852,223
Marine — 1.1%
Horizon Lines, Inc., 4.25%, 8/15/12 (d)		1,985		1,642,587
Navios Maritime Holdings, Inc., 8.88%, 11/01/17 (b)		470		478,225
Trico Shipping AS, 11.88%, 11/01/14 (b)		310		300,313
				2,421,125

See Notes to Financial Statements.
12	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund, Inc. (COY)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par  (000)	Value
Media — 14.0%
Affinion Group, Inc., 10.13%, 10/15/13	USD	2,255	$	2,277,550
CCH II LLC, 13.50%, 11/30/16		502		593,417
CCO Holdings LLC, 8.75%, 11/15/13		665		674,975
CMP Susquehanna Corp., 3.20%, 5/15/14 (b)		150		3,000
COX Enterprises, Inc.:
Loan Close 2, 12.00%, 8/15/18		600		600,000
Loan Close 3, 12.00%, 8/15/18		700		700,000
Shares Loan, 12.00%, 8/15/18		700		700,000
CSC Holdings, Inc., 8.50%, 4/15/14 (b)		370		388,963
Cablevision Systems Corp., Series B, 8.00%, 4/15/12		1,465		1,543,744
Catalina Marketing Corp., 10.50%, 10/01/15 (b)(e)		555		579,975
Charter Communications Operating, LLC (b):
10.00%, 4/30/12		500		517,500
10.38%, 4/30/14		660		669,900
Clear Channel Worldwide Holdings, Inc. (b):
Series A, 9.25%, 12/15/17		779		794,580
Series B, 9.25%, 12/15/17		3,710		3,812,025
DISH DBS Corp., 7.00%, 10/01/13		90		92,025
Gannett Co., Inc., 8.75%, 11/15/14 (b)		665		695,756
Harland Clarke Holdings Corp.:
6.00%, 5/15/15 (f)		330		262,350
9.50%, 5/15/15		390		355,875
Intelsat Corp., 9.25%, 6/15/16		2,420		2,504,700
Intelsat Subsidiary Holding Co. Ltd., 8.88%, 1/15/15 (b)		250		253,750
Liberty Global, Inc., 4.50%, 11/15/16 (b)(d)		410		489,437
Liberty Media Corp., 3.13%, 3/30/23 (d)		1,023		1,046,017
Lighthouse International Co. SA:
8.00%, 4/30/14	EUR	519		441,687
8.00%, 4/30/14 (b)		163		138,719
Lions Gate Entertainment, Inc., 10.25%, 11/01/16 (b)	USD	345		345,863
McClatchy Co., 11.50%, 2/15/17 (b)		240		234,000
Network Communications, Inc., 10.75%, 12/01/13		20		9,200
Nielsen Finance LLC:
11.63%, 2/01/14		70		77,963
10.00%, 8/01/14		1,740		1,805,250
ProtoStar I Ltd., 18.00%, 10/15/12 (a)(b)(d)(i)		812		771,181
Rainbow National Services LLC (b):
8.75%, 9/01/12		410		418,200
10.38%, 9/01/14		1,496		1,572,670
Seat Pagine Gialle SpA, 10.50%, 1/31/17 (b)	EUR	800		1,008,388
TL Acquisitions, Inc., 10.50%, 1/15/15 (b)	USD	3,245		2,957,006
UPC Germany GmbH (b):
8.13%, 12/01/17		500		500,000
8.13%, 12/01/17	EUR	522		717,892
9.63%, 12/01/19		930		1,279,003
UPC Holding BV, 9.88%, 4/15/18 (b)	USD	500		520,000
				32,352,561
Metals & Mining — 5.2%
Aleris International, Inc. (a)(i):
9.00%, 12/15/14		950		2,375
10.00%, 12/15/16		800		17,000
Drummond Co., Inc.:
9.00%, 10/15/14 (b)		800		800,000
7.38%, 2/15/16		215		200,488
FMG Finance Property Ltd. (b):
10.00%, 9/01/13		500		527,500
10.63%, 9/01/16		1,100		1,226,500
Foundation PA Coal Co., 7.25%, 8/01/14		1,850		1,850,000

Corporate Bonds		Par  (000)	Value
Metals & Mining (concluded)
GoldCorp., Inc., 2.00%, 8/01/14 (b)(d)	USD	180	$	201,600
McJunkin Red Man Corp., 9.50%, 12/15/16 (b)		1,160		1,162,900
Murray Energy Corp., 10.25%, 10/15/15 (b)		795		795,994
New World Resources NV, 7.38%, 5/15/15	EUR	610		739,243
Novelis, Inc.:
7.25%, 2/15/15	USD	1,440		1,335,600
11.50%, 2/15/15		405		430,312
Ryerson, Inc.:
7.62%, 11/01/14 (f)		380		339,150
12.00%, 11/01/15		245		251,738
Steel Dynamics, Inc., 7.38%, 11/01/12		440		447,700
Teck Resources Ltd.:
10.25%, 5/15/16		285		339,862
10.75%, 5/15/19		640		787,200
Vedanta Resources Plc, 9.50%, 7/18/18 (b)		600		633,000
				12,088,162
Multiline Retail — 1.3%
Dollar General Corp.:
10.63%, 7/15/15		140		153,300
11.88%, 7/15/17 (e)		2,257		2,623,762
Saks, Inc., 9.88%, 10/01/11		275		285,313
				3,062,375
Oil, Gas & Consumable Fuels — 7.4%
Arch Coal, Inc., 8.75%, 8/01/16 (b)		290		300,150
Atlas Energy Operating Co. LLC:
12.13%, 8/01/17		450		506,250
10.75%, 2/01/18		240		259,800
Berry Petroleum Co., 8.25%, 11/01/16		470		471,175
Bill Barrett Corp., 9.88%, 7/15/16		225		238,219
Chesapeake Energy Corp., 2.25%, 12/15/38 (d)		775		575,437
Connacher Oil and Gas Ltd. (b):
11.75%, 7/15/14		165		181,500
10.25%, 12/15/15		1,075		1,036,031
Crosstex Energy LP, 8.88%, 2/15/18 (b)		910		923,650
Denbury Resources, Inc., 8.25%, 2/15/20		800		828,000
Encore Acquisition Co., 6.25%, 4/15/14		1,850		1,863,875
Forest Oil Corp., 7.25%, 6/15/19		440		431,200
Massey Energy Co., 3.25%, 8/01/15 (d)		1,675		1,507,500
Niska Gas Storage US LLC, 8.88%, 3/15/18 (b)(g)		1,875		1,875,000
OPTI Canada, Inc., 9.00%, 12/15/12 (b)		1,250		1,271,875
Petrohawk Energy Corp.:
10.50%, 8/01/14		530		575,050
7.88%, 6/01/15		450		450,000
Range Resources Corp., 8.00%, 5/15/19		400		419,000
Roseton-Danskammer 2001, Series B, 7.67%, 11/08/16		1,760		1,698,400
Sabine Pass LNG LP, 7.50%, 11/30/16		350		307,125
SandRidge Energy, Inc.:
8.63%, 4/01/15 (e)		120		118,200
9.88%, 5/15/16 (b)		500		516,250
8.00%, 6/01/18 (b)		125		119,688
Teekay Shipping Corp., 8.50%, 1/15/20		610		619,150
				17,092,525
Paper & Forest Products — 4.0%
Ainsworth Lumber Co. Ltd., 11.00%, 7/29/15 (b)(e)		328		244,714
Boise Paper Holdings LLC, 9.00%, 11/01/17 (b)		355		365,650
Clearwater Paper Corp., 10.63%, 6/15/16 (b)		370		410,700
Georgia-Pacific LLC, 8.25%, 5/01/16 (b)		1,525		1,608,875
Glatfelter, 7.13%, 5/01/16 (b)		190		182,400

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	13

Schedule of Investments (continued) BlackRock Corporate High Yield Fund, Inc. (COY)
(Percentages shown are based on Net Assets)

Corporate Bonds	Par  (000)		Value
Paper & Forest Products (concluded)
NewPage Corp.:
10.00%, 5/01/12	USD	740	$	425,500
11.38%, 12/31/14		5,385		5,142,675
Verso Paper Holdings LLC:
11.50%, 7/01/14 (b)		320		336,000
Series B, 4.00%, 8/01/14 (f)		260		209,950
Series B, 9.13%, 8/01/14		305		280,600
				9,207,064
Pharmaceuticals — 1.4%
Angiotech Pharmaceuticals, Inc., 4.00%, 12/01/13 (f)		995		805,950
Elan Corp. Plc, 8.75%, 10/15/16 (b)		695		674,150
Elan Finance Plc, 8.88%, 12/01/13		90		91,350
Novasep Holding SAS, 9.63%, 12/15/16 (b)	EUR	893		1,124,762
Valeant Pharmaceuticals International, 8.38%, 6/15/16 (b)	USD	515		533,025
				3,229,237
Real Estate Investment Trusts (REITs) — 0.5%
iStar Financial, Inc., 5.65%, 9/15/11		1,500		1,170,000
Real Estate Management & Development — 0.5%
Forest City Enterprises, Inc., 7.63%, 6/01/15		1,325		1,192,500
Semiconductors & Semiconductor Equipment — 1.0%
Advanced Micro Devices, Inc., 8.13%, 12/15/17 (b)		1,140		1,154,250
Spansion, Inc., 3.79%, 6/01/13 (a)(b)(i)		1,135		1,123,650
				2,277,900
Software — 0.0%
BMS Holdings, Inc., 7.89%, 2/15/12 (b)(e)		426		8,512
Specialty Retail — 1.5%
Asbury Automotive Group, Inc., 7.63%, 3/15/17		330		311,438
General Nutrition Centers, Inc., 10.75%, 3/15/15		550		556,188
Group 1 Automotive, Inc., 2.25%, 6/15/36 (d)(h)		985		770,762
Limited Brands, Inc., 8.50%, 6/15/19		745		798,081
United Auto Group, Inc., 7.75%, 12/15/16		1,030		982,362
				3,418,831
Textiles, Apparel & Luxury Goods — 1.6%
Levi Strauss & Co., 8.63%, 4/01/13	EUR	1,750		2,394,812
Quiksilver, Inc., 6.88%, 4/15/15	USD	1,490		1,270,225
				3,665,037
Wireless Telecommunication Services — 5.3%
Cricket Communications, Inc.:
9.38%, 11/01/14		955		950,225
10.00%, 7/15/15		1,795		1,817,438
7.75%, 5/15/16		210		213,413
Digicel Group Ltd. (b):
8.88%, 1/15/15		1,285		1,227,175
9.13%, 1/15/15 (e)		1,911		1,862,866
FiberTower Corp., 9.00%, 1/01/16 (e)		284		230,144
iPCS, Inc., 2.37%, 5/01/13 (f)		760		699,200
MetroPCS Wireless, Inc., 9.25%, 11/01/14		2,255		2,249,362
Nextel Communications, Inc.:
Series D, 7.38%, 8/01/15		60		55,350
Series E, 6.88%, 10/31/13		1,770		1,699,200
Series F, 5.95%, 3/15/14		100		90,750
Orascom Telecom Finance SCA, 7.88%, 2/08/14 (b)		265		233,200
Sprint Capital Corp., 6.88%, 11/15/28		1,200		909,000
				12,237,323
Total Corporate Bonds — 103.4%				238,343,433

Floating Rate Loan Interests (f)	Par  (000)		Value
Aerospace & Defense — 0.1%
Hawker Beechcraft Acquisition Co. LLC, Incremental Term Loan, 10.50%, 3/26/14	USD	274	$	250,482
Auto Components — 1.0%
Allison Transmission, Inc., Term Loan, 2.98% – 3.00%, 8/07/14		2,216		2,029,556
Dana Holding Corp., Term Advance, 4.48% – 6.50%, 1/30/15		399		388,763
				2,418,319
Automobiles — 2.7%
Ford Motor Co., Tranche B-1 Term Loan, 3.24% – 3.26%, 12/15/13		6,641		6,203,454
Building Products — 1.3%
CPG International I, Inc., Term Loan, 5.23%, 2/28/11		2,955		2,954,774
Capital Markets — 0.1%
Marsico Parent Co., LLC, Term Loan, 5.25% – 5.31%, 12/15/14		381		241,724
Chemicals — 1.1%
PQ Corp., Term Loan (First Lien), 3.48% – 3.50%, 7/30/14		739		675,956
Solutia Inc., Loan, 7.25%, 2/28/14		304		308,132
Tronox Worldwide LLC, Tranche B-1 Term Loan, 9.00%, 6/24/10		1,400		1,436,680
				2,420,768
Construction & Engineering — 0.8%
Safway, Last Out, Term Loan, 15.63%, 12/14/17		1,750		1,750,000
Diversified Telecommunication Services — 2.0%
Wind Finance SL SA, Facility (Second Lien), 7.68%, 12/17/14	EUR	3,350		4,543,237
Food & Staples Retailing — 0.5%
Rite Aid Corp., Tranche 4 Term Loan, 9.50%, 6/10/15	USD	1,200		1,243,200
Hotels, Restaurants & Leisure — 1.2%
Travelport LLC (fka Travelport Inc.), Loan, 8.28%, 3/27/12		2,994		2,739,623
IT Services — 0.0%
First Data Corp., Initial Tranche B-1 Term Loan, 2.98%, 9/24/14		99		86,682
Independent Power Producers & Energy Traders — 1.2%
Texas Competitive Electric Holdings Co., LLC (TXU):
Initial Tranche B-1 Term Loan, 3.73% – 3.75%, 10/10/14		206		165,845
Initial Tranche B-2 Term Loan, 3.73% – 3.75%, 10/10/14		648		520,967
Initial Tranche B-3 Term Loan, 3.73% – 3.75%, 10/10/14		2,571		2,056,999
				2,743,811
Machinery — 0.2%
Accuride Corp., Term Loan, 9.75%, 6/30/13		550		548,854
Media — 2.3%
Affinion Group Holdings, Inc., Loan, 8.39%, 3/01/12		436		412,302
Cengage Learning Acquisitions, Inc. (Thomson Learning), Tranche 1 Incremental Term Loan, 7.50%, 7/03/14		1,478		1,462,725
HMH Publishing Co., Ltd.:
Mezzanine, 1.26%, 11/14/14		487		60,093
Tranche A Term Loan, 5.23%, 6/12/14		1,435		1,207,459

See Notes to Financial Statements.
14	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued) BlackRock Corporate High Yield Fund, Inc. (COY)
(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (f)	Par  (000)		Value
Media (concluded)
Newsday, LLC, Fixed Rate Term Loan, 10.50%, 8/01/13	USD	1,250	$	1,335,938
Virgin Media Investment Holdings Ltd., C Facility, 3.58%, 3/03/13	GBP	240		341,862
Worldcolor Press Inc. and Worldcolor (USA) Corp. (fka Quebecor World, Inc.), Advance, 9.00%, 7/23/12	USD	498		503,176
				5,323,555
Multiline Retail — 0.6%
Hema Holding BV, Mezzanine, 8.24% — 8.92%, 1/29/17	EUR	1,018		1,004,451
The Neiman Marcus Group, Inc., Term Loan, 6.25%, 4/06/13	USD	348		312,381
				1,316,832
Oil, Gas & Consumable Fuels — 0.7%
Turbo Beta Ltd., Dollar Facility, 14.50%, 3/15/18		2,175		1,631,030
Paper & Forest Products — 0.3%
Verso Paper Finance Holdings LLC, PIK Loan, 7.25%, 2/01/13 (e)		1,199		659,462
Real Estate Management & Development — 0.2%
Realogy Corp.:
Initial Term B Loan, 3.25%, 10/10/13		375		330,849
Synthetic Letter of Credit, 0.08%, 10/10/13		118		104,479
				435,328
Specialty Retail — 0.3%
Claire’s Stores, Inc., Term Loan B, 3.00%, 5/29/14		264		217,886
Michaels Stores, Inc. B-1 Term Loan, 2.50% – 2.56%, 10/31/13		349		314,406
Pedalgreen Ltd. PIK Loan Facility, 0.00%, 11/30/15 (e)	GBP	119		166,949
				699,241
Total Floating Rate Loan Interests — 16.6%				38,210,376

Other Interests (j)	Beneficial Interest (000)
Auto Components — 1.8%
Delphi Debtor in Possession Holding Co. LLP, Class B Membership Interests	USD	—	(k)	4,209,089
Media — 0.0%
Adelphia Escrow		700		70
Adelphia Recovery Trust		878		3,511
				3,581
Total Other Interests — 1.8%				4,212,670

			3,581
Preferred Stocks	Shares
Media — 0.0%
CMP Susquehanna Radio Holdings Corp. (a)(b)(f)		34,982	—
Total Preferred Stocks — 0.0%			—

Warrants (l)	Shares		Value
Construction & Engineering — 0.0%
Safway US LLC (expires 12/14/17)		321	$	1
Health Care Providers & Services — 0.0%
HealthSouth Corp. (expires 1/16/14)		29,930		—
Media — 0.0%
CMP Susquehanna Radio Holdings Corp. (expires 3/26/19) (b)		39,975		—
New Vision Holdings LLC (expires 9/30/14)		14,965		150
				150
Oil, Gas & Consumable Fuels — 0.0%
Turbo Cayman Ltd. (no expiration)		1		—
Total Warrants — 0.0%				151
Total Long-Term Investments (Cost — $296,237,011) — 125.8%				289,985,670

Short-Term Securities
BlackRock Liquidity Funds, TempCash, Institutional Class, 0.12% (m)(n)	4,931,674	4,931,674
Total Short-Term Securities (Cost — $4,931,674) — 2.1%		4,931,674

Options Purchased	Contracts
Over-the-Counter Call Options — 0.0%
Marsico Parent Superholdco LLC, Strike Price USD 942.86, Expires 12/01/19, Broker Goldman Sachs Bank USA		17		3,230
Total Options Purchased (Cost — $16,622) — 0.0%				3,230
Total Investments (Cost — $301,185,307*) — 127.9%				294,920,574
Liabilities in Excess of Other Assets — (27.9)%				(64,328,036	)
Net Assets — 100.0%			$	230,592,538

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	15

Schedule of Investments (continued) BlackRock Corporate High Yield Fund, Inc. (COY)

* The cost and unrealized appreciation (depreciation) of investments as of February 28, 2010, as computed for federal income tax purposes, were as follows:

Aggregate cost	$	302,371,946
Gross unrealized appreciation	$	13,143,585
Gross unrealized depreciation		(20,594,957	)
Net unrealized depreciation	$	(7,451,372	)

(a)	Non-income producing security.
(b)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)	Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.
(d)	Convertible security.
(e)	Represents a payment-in-kind security which may pay interest/dividends in additional face/shares.
(f)	Variable rate security. Rate shown is as of report date.
(g)	When-issued security. Unsettled when-issued security transactions were as follows:

Counterparty	Value		Unrealized Appreciation
Citigroup Global	$	345,675		—
JPMorgan Securities	$	410,000		—
Morgan Stanley Capital Services, Inc.	$	1,875,000		—
Wells Fargo Bank	$	153,938	$	3,938

(h)	Represents a step-down bond that pays an initial coupon rate for the first period and then a lower coupon rate for the following periods. Rate shown is as of report date.
(i)	Issuer filed for bankruptcy and/or is in default of interest payments.
(j)	Other interests represent beneficial interest in liquidation trusts and other reorganization entities and are non-income producing.
(k)	Amount is less than $1,000.
(l)	Warrants entitle the Fund to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date.
(m)	Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows:

Affiliate	Net Activity			Income
BlackRock Liquidity Funds, TempCash, Institutional Class	$	4,931,674		$	8,170
BlackRock Liquidity Series, LLC Cash Sweep Series	$	(7,111,263	)	$	905

(n)

Represents the current yield as of report date.

•

For Fund compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report which may combine industry sub-classifications for reporting ease. These industry classifications are unaudited.

  • Foreign currency exchange contracts as of February 28, 2010 were as follows:

Currency Purchased		Currency Sold		Counterparty	Settlement Date	Unrealized Appreciation (Depreciation)
EUR	304,000	USD	414,608	Citibank NA	3/03/10	$	(669	)
EUR	1,467,800	USD	2,023,491	Citibank NA	3/24/10		(24,948	)
USD	21,425,096	EUR	14,828,500	Citibank NA	3/24/10		1,234,740
USD	756,103	EUR	541,500	Citibank NA	3/24/10		18,800
USD	321,195	GBP	204,500	Citibank NA	4/21/10		9,497
USD	2,349,986	GBP	1,451,500	Morgan	4/21/10		137,617
				Stanley Capital Services, Inc.
USD	181,633	CAD	190,000	Goldman Sachs International	4/21/10		1,076
Total						$	1,376,113

• Credit default swaps on single-name issues — buy protection outstanding as of February 28, 2010 were as follows:

Issuer	Pay Fixed Rate		Counterparty	Expiration	Notional Amount (000)		Unrealized Appreciation (Depreciation)
iStar Financial, Inc.	5.00	%	Morgan Stanley Capital Services, Inc.	September 2011	USD	1,500	$	(15,610	)
K. Hovnanian Enterprises, Inc.	5.00	%	Goldman Sachs Bank USA	December 2011	USD	475		(3,057	)
K. Hovnanian Enterprises, Inc.	5.00	%	Goldman Sachs Bank USA	December 2013	USD	925		(32,364	)
Louisiana-Pacific Corp.	5.00	%	JPMorgan Chase Bank NA	March 2014	USD	500		(131,515	)
Macy’s, Inc.	8.05	%	Goldman Sachs Bank USA	March 2014	USD	600		(143,867	)
Centex Corp.	1.00	%	Deutsche Bank AG	September 2014	USD	175		973
Limited Brands, Inc.	1.00	%	Goldman Sachs Bank USA	September 2014	USD	1,000		(35,054	)
Limited Brands, Inc.	1.00	%	JPMorgan Chase Bank NA	September 2014	USD	50		(1,717	)
American Axle and Manufacturing Inc.	5.00	%	Deutsche Bank AG	December 2014	USD	375		(2,807	)
Boston Scientific Corp.	1.00	%	Goldman Sachs Bank USA	December 2014	USD	500		919
Brunswick Corp.	5.00	%	Morgan Stanley Capital Services, Inc.	December 2016	USD	1,500		13,409
Total							$	(350,690	)

See Notes to Financial Statements.
16	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (concluded) BlackRock Corporate High Yield Fund, Inc. (COY)

• Credit default swaps on single-name issues — sold protection outstanding as of February 28, 2010 were as follows:

Issuer	Receive Fixed Rate		Counterparty	Expiration	Credit Rating1	Notional Amount (000)2	Unrealized Appreciation (Depreciation)
Advanced Micro Devices, Inc.	5.00	%	JPMorgan Chase Bank NA	March 2015	B–	USD 550	$	2,053
Realogy Corp.	5.00	%	Credit Suisse International	March 2015	C	USD 100		1,285
Realogy Corp.	5.00	%	JPMorgan Chase Bank NA	March 2015	C	USD 450		(14,983	)
Standard Pacific Corp.	5.00	%	Goldman Sachs International	March 2015	CCC	USD 250		(224	)
Total							$	(11,869	)

1	Using S&P’s rating of the issuer.
2	The maximum potential amount the Fund may pay should a negative credit take place as defined under the terms of the agreement.

•	Fair Value Measurements — Various inputs are used in determining the fair value of investments, which are as follows:
	•	Level 1 — price quotations in active markets/exchanges for identical assets and liabilities
	•	Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)
	•	Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments)
	The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
	The following tables summarize the inputs used as of February 28, 2010 in determining the fair valuation of the Fund’s investments:

	Investments in Securities
Valuation Inputs	Level 1		Level 2			Level 3			Total
Assets:
Long-Term Investments:
Common Stocks	$	8,807,025	$	336,919		$	75,096		$	9,219,040
Corporate Bonds		—		234,382,073			3,961,360			238,343,433
Floating Rate Loan Interests		—		18,991,565			19,218,811			38,210,376
Other Interests		—		—			4,212,670			4,212,670
Warrants		—		1			150			151
Short-Term Securities		4,931,674		—			—			4,931,674
Total	$	13,738,699	$	253,710,558		$	27,468,087		$	294,917,344
	Other Financial Instruments1
Valuation Inputs	Level 1		Level 2			Level 3			Total
Assets		—	$	1,423,599			—		$	1,423,599
Liabilities		—		(406,815	)	$	(51,643	)		(458,458	)
Total		—	$	1,016,784		$	(51,643	)	$	965,141

¹ Other financial instruments are swaps, foreign currency exchange contracts, options and unfunded loan commitments. Swaps, foreign currency exchange contracts and unfunded loan commitments are shown at the unrealized appreciation/depreciation on the instrument and options are shown at market value.

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Investments in Securities
	Common Stocks		Corporate Bonds			Floating Rate Loan Interests			Other Interests		Warrants		Total
Balance, as of February 28, 2009	$	356	$	1,404,473		$	14,962,760		$	3,582		—	$	16,371,171
Accrued discounts/premiums		—		—			—			—		—		—
Realized gain (loss)		—		(5,465	)		(4,784,296	)		—		—		(4,789,761	)
Change in unrealized appreciation/depreciation2		—		282,192			15,063,883			—		—		15,346,075
Net purchases (sales)		—		6,342			(7,162,942	)		—		—		(7,156,600	)
Net transfers in (out) of Level 3		74,740		2,273,818			1,139,406			4,209,088	$	150		7,697,202
Balance, as of February 28, 2010	$	75,096	$	3,961,360		$	19,218,811		$	4,212,670	$	150	$	27,468,087

² Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in the unrealized appreciation/depreciation on the securities still held on February 28, 2010 was $6,741,424.

The following table is a reconciliation of Level 3 other financial instruments for which significant unobservable inputs were used to determine fair value:

	Other Financial Instruments3
Balance, as of February 28, 2009		—
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation/depreciation4	$	(51,643	)
Net purchases (sales)		—
Net transfers in/out of Level 3		—
Balance, as of February 28, 2010	$	(51,643	)

3	Other financial instruments are unfunded loan commitments.
4	Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in unrealized appreciation/depreciation on the securities still held at February 28, 2010 was $(51,643).

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	17

Schedule of Investments February 28, 2010	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

Common Stocks	Shares		Value
Auto Components — 0.2%
Lear Corp. (a)		6,665	$	461,685
Building Products — 0.6%
Masonite Worldwide Holdings (a)		34,575		1,452,150
Capital Markets — 0.2%
E*Trade Financial Corp. (a)		296,000		476,560
Chemicals — 0.1%
Solutia, Inc. (a)		8,000		112,560
Wellman Holdings, Inc. (a)		1,522		381
				112,941
Communications Equipment — 1.0%
Brocade Communications Systems, Inc. (a)		50,000		291,000
Loral Space & Communications Ltd. (a)		64,095		2,085,010
				2,376,010
Construction Materials — 0.0%
Nortek, Inc. (a)		2,145		79,365
Containers & Packaging — 0.2%
Rock-Tenn Co., Class A		13,000		543,920
Diversified Financial Services — 0.4%
Bank of America Corp.		65,000		1,082,900
Citigroup, Inc. (a)		1		3
				1,082,903
Diversified Telecommunication Services — 0.5%
Qwest Communications International, Inc.		247,855		1,130,219
Electrical Equipment — 0.0%
Medis Technologies Ltd. (a)		70,784		5,025
SunPower Corp., Class B (a)		778		12,705
				17,730
Food Products — 0.0%
Pilgrims Pride Corp. (a)		6,334		57,133
Hotels, Restaurants & Leisure — 0.0%
Buffets Restaurants Holdings, Inc. (a)		1,099		6,209
Household Durables — 0.4%
Beazer Homes USA, Inc. (a)		139,500		580,320
Pulte Homes, Inc. (a)		30,000		324,900
Standard-Pacific Corp. (a)		15,000		63,300
				968,520
Machinery — 0.1%
Accuride Corp. (a)		90,983		118,278
Accuride Corp. — Restricted Shares (a)		90,983		118,278
				236,556
Media — 0.3%
Gannett Co., Inc.		56,000		848,400
Paper & Forest Products — 0.2%
Ainsworth Lumber Co. Ltd. (a)		125,117		262,791
Ainsworth Lumber Co. Ltd. (a)(b)		140,415		294,922
Western Forest Products, Inc. (a)		158,023		33,041
Western Forest Products, Inc. (a)(b)		45,762		9,568
				600,322
Software — 0.1%
TiVo, Inc. (a)		31,000		293,880
Wireless Telecommunication Services — 0.3%
FiberTower Corp. (a)		76,542		315,353
SBA Communications Corp., Class A (a)		8,500		300,560
				615,913
Total Common Stocks — 4.6%				11,360,416

Corporate Bonds		Par  (000)	Value
Airlines — 2.4%
American Airlines, Inc., 10.50%, 10/15/12 (b)	USD	1,080	$	1,107,000
American Airlines Pass Through Trust, Series 2001-02, 7.86%, 4/01/13		400		403,000
Continental Airlines, Inc.:
Series 1997-4-B, 6.90%, 7/02/18 (c)		522		480,124
Series 2001-1-C, 7.03%, 12/15/12		302		294,485
Series 2003-RJ, 7.88%, 1/02/20		440		391,931
Delta Air Lines, Inc., Series B, 9.75%, 12/17/16		1,100		1,133,000
United Air Lines, Inc., 12.75%, 7/15/12		2,100		2,226,000
				6,035,540
Auto Components — 1.7%
Delphi International Holdings Unsecured, 12.00%, 10/06/14		91		91,104
The Goodyear Tire & Rubber Co.:
7.86%, 8/15/11		1,200		1,242,000
8.63%, 12/01/11		552		572,700
Icahn Enterprises LP (b):
4.00%, 8/15/13 (d)(e)		255		224,069
8.00%, 1/15/18		2,360		2,218,400
				4,348,273
Biotechnology — 0.3%
QHP Pharma, 10.25%, 3/15/15 (b)		710		724,825
Building Products — 1.1%
Associated Materials LLC, 9.88%, 11/15/16		720		763,200
Building Materials Corp. of America, 7.00%, 2/15/20 (b)		620		620,000
Goodman Global Group, Inc., 12.86%, 12/15/14 (b)(f)		290		168,200
Ply Gem Industries, Inc., 11.75%, 6/15/13		1,090		1,106,350
				2,657,750
Capital Markets — 0.7%
E*Trade Financial Corp. (e)(f):
3.39%, 8/31/19 (b)		244		370,880
Series A, 3.64%, 8/31/19		7		10,640
MU Finance Plc, 8.75%, 2/01/17 (b)	GBP	422		595,209
Marsico Parent Co., LLC, 10.63%, 1/15/16 (b)	USD	963		579,004
Marsico Parent Holdco, LLC, 12.50%, 7/15/16 (b)(g)		411		90,851
Marsico Parent Superholdco, LLC, 14.50%, 1/15/18 (b)(g)		269		46,759
				1,693,343
Chemicals — 2.8%
American Pacific Corp., 9.00%, 2/01/15		880		869,000
Georgia Gulf Corp., 9.00%, 1/15/17 (b)		230		238,625
Hexion Finance Escrow LLC, 8.88%, 2/01/18 (b)		1,820		1,701,700
Hexion U.S. Finance Corp., 9.75%, 11/15/14		310		292,950
Huntsman International LLC (b):
6.88%, 11/15/13	EUR	280		355,528
5.50%, 6/30/16	USD	545		479,600
Innophos, Inc., 8.88%, 8/15/14		825		847,688
MacDermid, Inc., 9.50%, 4/15/17 (b)		1,260		1,260,000
Wellman Holdings, Inc. (e):
Second Lien Subordinate Note, 10.00%, 1/29/19 (b)		844		844,000
Third Lien Subordinate Note, 5.00%, 1/29/19 (g)		269		134,759
				7,023,850

See Notes to Financial Statements.
18	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

		Par  (000)
Corporate Bonds			Value
Commercial Banks — 0.1%
Glitnir Banki HF (a)(h):
4.38%, 2/05/10	USD	50	$	17,702
4.15%, 4/20/10 (b)		111		28,860
Series EMTN, 5.07%, 1/27/10	EUR	50		17,701
Series EMTN, 3.00%, 6/30/10		45		15,625
Series GMTN, 6.38%, 9/25/12 (b)	USD	500		130,000
				209,888
Commercial Services & Supplies — 3.0%
ACCO Brands Corp., 10.63%, 3/15/15 (b)		250		271,750
RSC Equipment Rental, Inc., 10.00%, 7/15/17 (b)		585		625,950
Scientific Games International, Inc., 9.25%, 6/15/19		855		904,162
Waste Services, Inc., 9.50%, 4/15/14		3,000		3,082,500
West Corp.:
9.50%, 10/15/14		435		431,738
11.00%, 10/15/16		2,245		2,250,612
				7,566,712
Construction Materials — 1.2%
Nortek, Inc., 11.00%, 12/01/13		2,155		2,262,260
Texas Industries, Inc., 7.25%, 7/15/13		785		763,412
				3,025,672
Consumer Finance — 0.5%
Credit Acceptance Corp., 9.13%, 2/01/17 (b)		680		676,600
Ford Motor Credit Co. LLC:
3.00%, 1/13/12 (d)		215		201,562
7.80%, 6/01/12		200		202,114
8.00%, 12/15/16		180		180,745
				1,261,021
Containers & Packaging — 4.0%
Berry Plastics Escrow LLC, 8.88%, 9/15/14 (b)		470		452,375
Berry Plastics Holding Corp., 8.88%, 9/15/14		1,050		1,010,625
Crown European Holdings SA, 6.25%, 9/01/11	EUR	75		104,167
Graphic Packaging International, Inc., 9.50%, 6/15/17	USD	840		882,000
Impress Holdings BV, 3.38%, 9/15/13 (b)(d)		420		391,650
Owens-Brockway Glass Container, Inc.:
8.25%, 5/15/13		1,000		1,015,000
6.75%, 12/01/14	EUR	155		211,057
Packaging Dynamics Finance Corp., 10.00%, 5/01/16 (b)	USD	1,090		867,912
Pregis Corp., 12.38%, 10/15/13		1,200		1,191,000
Rock-Tenn Co., 8.20%, 8/15/11		2,000		2,155,000
Smurfit Kappa Acquisitions (b):
7.25%, 11/15/17	EUR	495		660,539
7.75%, 11/15/19		470		636,778
Solo Cup Co., 10.50%, 11/01/13	USD	475		497,563
				10,075,666
Diversified Consumer Services — 1.2%
Service Corp. International, 7.00%, 6/15/17		3,000		2,940,000
Diversified Financial Services — 8.6%
Axcan Intermediate Holdings, Inc., 12.75%, 3/01/16		520		562,900
CIT Group, Inc.:
7.00%, 5/01/16		1,341		1,187,215
7.00%, 5/01/17		5,740		5,072,796
FCE Bank Plc:
7.88%, 2/15/11	GBP	700		1,075,371
7.13%, 1/16/12	EUR	1,800		2,429,412
7.13%, 1/15/13		1,050		1,401,144

		Par  (000)
Corporate Bonds			Value
Diversified Financial Services (concluded)
GMAC LLC:
7.25%, 3/02/11	USD	464	$	468,060
6.88%, 9/15/11		500		500,000
6.88%, 8/28/12		600		594,000
2.45%, 12/01/14 (d)		464		396,950
6.75%, 12/01/14		1,020		974,100
8.30%, 2/12/15 (b)		2,160		2,178,900
8.00%, 11/01/31		1,140		1,051,650
General Motors Acceptance Corp. of Canada Ltd., 6.00%, 5/25/10	CAD	300		281,502
Leucadia National Corp., 8.13%, 9/15/15	USD	1,325		1,344,875
Reynolds Group DL Escrow, Inc., 7.75%, 10/15/16 (b)		1,460		1,478,250
Reynolds Group Issuer, Inc., 7.75%, 10/15/16 (b)	EUR	400		543,306
				21,540,431
Diversified Telecommunication Services — 3.8%
Broadview Networks Holdings, Inc., 11.38%, 9/01/12	USD	1,035		993,600
GCI, Inc., 8.63%, 11/15/19 (b)		1,200		1,219,500
Level 3 Financing, Inc., 10.00%, 2/01/18 (b)		680		623,900
Nordic Telephone Co. Holdings ApS, 8.88%, 5/01/16 (b)		215		230,050
Qwest Communications International, Inc.:
7.50%, 2/15/14		2,020		2,040,200
8.00%, 10/01/15 (b)		600		621,000
Series B, 7.50%, 2/15/14		1,730		1,747,300
Qwest Corp.:
7.63%, 6/15/15		525		561,094
8.38%, 5/01/16		680		744,600
Windstream Corp., 8.13%, 8/01/13		760		790,400
				9,571,644
Electric Utilities — 1.2%
Intergen NV, 9.00%, 6/30/17 (b)		420		428,400
NSG Holdings LLC, 7.75%, 12/15/25 (b)		1,030		890,950
Tenaska Alabama Partners LP, 7.00%, 6/30/21 (b)		1,810		1,813,700
				3,133,050
Electronic Equipment, Instruments & Components — 0.1%
Jabil Circuit, Inc., 7.75%, 7/15/16		295		305,325
Energy Equipment & Services — 1.4%
Compagnie Générale de Géophysique-Veritas:
7.50%, 5/15/15		215		210,700
7.75%, 5/15/17		320		313,600
Expro Finance Luxembourg SCA, 8.50%, 12/15/16 (b)		1,835		1,825,825
North American Energy Alliance LLC, 10.88%, 6/01/16 (b)		665		704,900
North American Energy Partners, Inc., 8.75%, 12/01/11		375		373,125
				3,428,150
Food & Staples Retailing — 0.8%
AmeriQual Group LLC, 9.50%, 4/01/12 (b)		800		720,000
Duane Reade, Inc., 11.75%, 8/01/15		165		207,900
Rite Aid Corp.:
9.75%, 6/12/16		410		437,675
10.25%, 10/15/19		670		708,525
				2,074,100

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	19

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

		Par  (000)
Corporate Bonds			Value
Food Products — 0.7%
B&G Foods, Inc., 7.63%, 1/15/18	USD	220	$	222,200
Reddy Ice Corp., 11.25%, 3/15/15 (b)(i)		440		440,000
Smithfield Foods, Inc., 10.00%, 7/15/14 (b)		780		844,350
TreeHouse Foods, Inc., 7.75%, 3/01/18 (i)		160		164,200
				1,670,750
Health Care Equipment & Supplies — 1.3%
DJO Finance LLC:
10.88%, 11/15/14		1,670		1,786,900
10.88%, 11/15/14 (b)		600		642,000
Hologic, Inc., 2.00%, 12/15/37 (e)(j)		955		816,525
				3,245,425
Health Care Providers & Services — 3.5%
Community Health Systems, Inc., Series WI, 8.88%, 7/15/15		1,460		1,511,100
HCA, Inc., 9.13%, 11/15/14		1,785		1,876,481
LifePoint Hospitals, Inc., 3.50%, 5/15/14 (e)		110		100,788
Tenet Healthcare Corp. (b):
9.00%, 5/01/15		1,564		1,638,290
10.00%, 5/01/18		644		708,400
8.88%, 7/01/19		1,289		1,359,895
Vanguard Health Holding Co.II LLC, 8.00%, 2/01/18 (b)		1,555		1,527,787
				8,722,741
Health Care Technology — 0.8%
IMS Health, Inc., 12.50%, 3/01/18 (b)		1,770		2,035,500
Hotels, Restaurants & Leisure — 2.9%
Greektown Holdings, LLC, 10.75%, 12/01/13 (a)(b)(h)		439		26,340
Harrah’s Operating Co., Inc., 11.25%, 6/01/17		1,100		1,141,250
Inn of the Mountain Gods Resort & Casino, 12.00%, 11/15/10 (a)(h)		1,550		751,750
Little Traverse Bay Bands of Odawa Indians, 10.25%, 2/15/14 (a)(b)(h)		1,290		325,725
MGM Mirage:
13.00%, 11/15/13		1,155		1,316,700
10.38%, 5/15/14 (b)		255		270,300
11.13%, 11/15/17 (b)		820		885,600
Pinnacle Entertainment, Inc., 8.63%, 8/01/17 (b)		685		650,750
San Pasqual Casino, 8.00%, 9/15/13 (b)		975		926,250
Scientific Games Corp., 0.75%, 12/01/24 (e)(j)		280		271,950
Shingle Springs Tribal Gaming Authority, 9.38%, 6/15/15 (b)		60		47,700
Travelport LLC:
4.88%, 9/01/14 (d)		160		148,800
9.88%, 9/01/14		210		214,725
Tropicana Entertainment LLC, Series WI, 9.63%, 12/15/14 (a)(h)		305		191
Virgin River Casino Corp., 9.00%, 1/15/12 (a)(g)		940		178,600
				7,156,631
Household Durables — 2.3%
Beazer Homes USA, Inc., 12.00%, 10/15/17 (b)		1,345		1,499,675
Jarden Corp., 8.00%, 5/01/16		275		287,375
K. Hovnanian Enterprises, Inc., 10.63%, 10/15/16		1,725		1,802,625
KB Home:
6.38%, 8/15/11		29		29,508
9.10%, 9/15/17		215		223,062
Standard Pacific Corp.:
6.25%, 4/01/14		365		328,500
7.00%, 8/15/15		265		238,500
10.75%, 9/15/16		1,225		1,277,062
				5,686,307

		Par  (000)
Corporate Bonds			Value
Household Products — 0.1%
Libbey Glass, Inc., 10.00%, 2/15/15 (b)	USD	135	$	139,725
IT Services — 1.4%
Alliance Data Systems Corp., 1.75%, 8/01/13 (e)		1,645		1,521,625
First Data Corp.:
9.88%, 9/24/15		1,600		1,368,000
9.88%, 9/24/15 (b)		20		17,300
11.25%, 3/31/16		810		664,200
				3,571,125
Independent Power Producers & Energy Traders — 3.8%
The AES Corp., 8.75%, 5/15/13 (b)		1,070		1,088,725
AES Eastern Energy LP, Series 99-B, 9.67%, 1/02/29		610		661,088
Calpine Construction Finance Co. LP, 8.00%, 6/01/16 (b)		1,260		1,275,750
Energy Future Holdings Corp.:
10.88%, 11/01/17		430		325,725
11.25%, 11/01/17 (g)		2,944		2,060,646
10.00%, 1/15/20 (b)		1,875		1,912,500
NRG Energy, Inc., 7.25%, 2/01/14		2,115		2,130,862
				9,455,296
Industrial Conglomerates — 2.5%
Sequa Corp. (b):
11.75%, 12/01/15		2,340		2,293,200
13.50%, 12/01/15 (g)		3,954		3,963,896
				6,257,096
Insurance — 0.9%
Alliant Holdings I, Inc., 11.00%, 5/01/15 (b)		1,700		1,729,750
USI Holdings Corp., 4.13%, 11/15/14 (b)(d)		680		562,700
				2,292,450
Internet & Catalog Retail — 0.1%
NetFlix, Inc., 8.50%, 11/15/17		355		371,863
Internet Software & Services — 0.3%
Equinix, Inc, 8.13%, 3/01/18 (i)		620		620,000
Leisure Equipment & Products — 0.6%
Brunswick Corp., 11.25%, 11/01/16 (b)		995		1,106,938
Easton-Bell Sports, Inc., 9.75%, 12/01/16 (b)		280		290,500
				1,397,438
Life Sciences Tools & Services — 0.1%
Bio-Rad Laboratories, Inc., 8.00%, 9/15/16 (b)		175		182,875
Machinery — 1.2%
AGY Holding Corp., 11.00%, 11/15/14		980		784,000
Accuride Corp., 7.50%, 2/26/20 (e)(g)		9		15,927
Navistar International Corp.:
3.00%, 10/15/14 (e)		510		521,475
8.25%, 11/01/21		1,000		1,015,000
RBS Global, Inc., 8.88%, 9/01/16		450		407,250
Titan International, Inc., 5.63%, 1/15/17 (b)(e)		240		252,600
				2,996,252
Marine — 1.1%
Horizon Lines, Inc., 4.25%, 8/15/12 (e)		2,230		1,845,325
Navios Maritime Holdings, Inc., 8.88%, 11/01/17 (b)		500		508,750
Trico Shipping AS, 11.88%, 11/01/14 (b)		330		319,688
				2,673,763

See Notes to Financial Statements.
20	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

Corporate Bonds	Par  (000)		Value
Media — 13.7%
Affinion Group, Inc., 10.13%, 10/15/13	USD	2,460	$	2,484,600
CCH II LLC, 13.50%, 11/30/16		543		641,063
CCO Holdings LLC, 8.75%, 11/15/13		555		563,325
CMP Susquehanna Corp., 3.20%, 5/15/14 (b)		160		3,200
COX Enterprises, Inc.:
Loan Close 2, 12.00%, 8/15/18		630		630,000
Loan Close 3, 12.00%, 8/15/18		735		735,000
Shares Loan, 12.00%, 8/15/18		735		735,000
CSC Holdings, Inc., 8.50%, 4/15/14 (b)		390		409,988
Cablevision Systems Corp., Series B, 8.00%, 4/15/12		1,515		1,596,431
Catalina Marketing Corp., 10.50%, 10/01/15 (b)(g)		610		637,450
Charter Communications Operating, LLC (b):
10.00%, 4/30/12		500		517,500
10.38%, 4/30/14		670		680,050
Clear Channel Worldwide Holdings, Inc. (b):
Series A, 9.25%, 12/15/17		835		851,700
Series B, 9.25%, 12/15/17		3,985		4,094,587
DISH DBS Corp., 7.00%, 10/01/13		90		92,025
Gannett Co.,Inc., 8.75%, 11/15/14 (b)		600		627,750
Harland Clarke Holdings Corp.:
6.00%, 5/15/15 (d)		350		278,250
9.50%, 5/15/15		420		383,250
Intelsat Corp., 9.25%, 6/15/16		2,450		2,535,750
Intelsat Subsidiary Holding Co. Ltd., 8.88%, 1/15/15 (b)		260		263,900
Liberty Global, Inc., 4.50%, 11/15/16 (b)(e)		440		525,250
Liberty Media Corp., 3.13%, 3/30/23 (e)		1,113		1,138,043
Lighthouse International Co. SA:
8.00%, 4/30/14	EUR	546		464,665
8.00%, 4/30/14 (b)		177		150,633
Lions Gate Entertainment, Inc., 10.25%, 11/01/16 (b)	USD	370		370,925
McClatchy Co., 11.50%, 2/15/17 (b)		260		253,500
Network Communications, Inc., 10.75%, 12/01/13		30		13,800
Nielsen Finance LLC:
11.63%, 2/01/14		180		200,475
10.00%, 8/01/14		1,890		1,960,875
ProtoStar I Ltd., 18.00%, 10/15/12 (a)(b)(e)(h)		850		807,410
Rainbow National Services LLC (b):
8.75%, 9/01/12		440		448,800
10.38%, 9/01/14		1,582		1,663,078
Seat Pagine Gialle SpA, 10.50%, 1/31/17 (b)	EUR	864		1,089,059
TL Acquisitions, Inc., 10.50%, 1/15/15 (b)	USD	3,465		3,157,481
UPC Germany GmbH (b):
8.13%, 12/01/17		600		600,000
8.13%, 12/01/17	EUR	566		778,404
9.63%, 12/01/19		995		1,368,396
UPC Holding BV, 9.88%, 4/15/18 (b)	USD	500		520,000
				34,271,613
Metals & Mining — 5.1%
Aleris International, Inc. (a)(h):
9.00%, 12/15/14		1,035		2,588
10.00%, 12/15/16		800		17,000
Drummond Co., Inc.:
9.00%, 10/15/14 (b)		875		875,000
7.38%, 2/15/16		225		209,813
FMG Finance Property Ltd. (b):
10.00%, 9/01/13		535		564,425
10.63%, 9/01/16		1,180		1,315,700

Corporate Bonds	Par  (000)			Value
Metals & Mining (concluded)
Foundation PA Coal Co., 7.25%, 8/01/14	USD	1,975	$	1,975,000
GoldCorp., Inc., 2.00%, 8/01/14 (b)(e)		190		212,800
McJunkin Red Man Corp., 9.50%, 12/15/16 (b)		1,245		1,248,112
Murray Energy Corp., 10.25%, 10/15/15 (b)		845		846,056
New World Resources NV, 7.38%, 5/15/15	EUR	625		757,421
Novelis, Inc.:
7.25%, 2/15/15	USD	1,515		1,405,162
11.50%, 2/15/15		430		456,875
Ryerson, Inc.:
7.62%, 11/01/14 (d)		400		357,000
12.00%, 11/01/15		265		272,288
Steel Dynamics, Inc., 7.38%, 11/01/12		460		468,050
Teck Resources Ltd.:
10.25%, 5/15/16		300		357,750
10.75%, 5/15/19		670		824,100
Vedanta Resources Plc, 9.50%, 7/18/18 (b)		640		675,200
				12,840,340
Multiline Retail — 1.3%
Dollar General Corp.:
10.63%, 7/15/15		148		162,060
11.88%, 7/15/17 (g)		2,431		2,826,037
Saks, Inc., 9.88%, 10/01/11		295		306,063
				3,294,160
Oil, Gas & Consumable Fuels — 7.3%
Arch Coal, Inc., 8.75%, 8/01/16 (b)		310		320,850
Atlas Energy Operating Co. LLC:
12.13%, 8/01/17		500		562,500
10.75%, 2/01/18		260		281,450
Berry Petroleum Co., 8.25%, 11/01/16		510		511,275
Bill Barrett Corp., 9.88%, 7/15/16		240		254,100
Chesapeake Energy Corp., 2.25%, 12/15/38 (e)		800		594,000
Connacher Oil and Gas Ltd. (b):
11.75%, 7/15/14		175		192,500
10.25%, 12/15/15		1,145		1,103,494
Crosstex Energy LP, 8.88%, 2/15/18 (b)		990		1,004,850
Denbury Resources, Inc., 8.25%, 2/15/20		900		931,500
Encore Acquisition Co., 6.25%, 4/15/14		2,000		2,015,000
Forest Oil Corp., 7.25%, 6/15/19		470		460,600
Massey Energy Co., 3.25%, 8/01/15 (e)		1,750		1,575,000
Niska Gas Storage US LLC, 8.88%, 3/15/18 (b)(i)		2,030		2,030,000
OPTI Canada, Inc., 9.00%, 12/15/12 (b)		1,340		1,363,450
Petrohawk Energy Corp.:
10.50%, 8/01/14		555		602,175
7.88%, 6/01/15		460		460,000
Range Resources Corp., 8.00%, 5/15/19		400		419,000
Roseton-Danskammer 2001, Series B, 7.67%, 11/08/16		1,895		1,828,675
Sabine Pass LNG LP, 7.50%, 11/30/16		390		342,225
SandRidge Energy, Inc.:
8.63%, 4/01/15 (g)		120		118,200
9.88%, 5/15/16 (b)		500		516,250
8.00%, 6/01/18 (b)		135		129,262
Teekay Shipping Corp., 8.50%, 1/15/20		660		669,900
				18,286,256
Paper & Forest Products — 4.2%
Ainsworth Lumber Co. Ltd., 11.00%, 7/29/15 (b)(g)		1,106		824,310
Boise Paper Holdings LLC, 9.00%, 11/01/17 (b)		380		391,400
Clearwater Paper Corp., 10.63%, 6/15/16 (b)		390		432,900
Georgia-Pacific LLC, 8.25%, 5/01/16 (b)		1,600		1,688,000
Glatfelter, 7.13%, 5/01/16 (b)		210		201,600

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	21

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

Corporate Bonds	Par  (000)			Value
Paper & Forest Products (concluded)
NewPage Corp.:
10.00%, 5/01/12	USD	785	$	451,375
11.38%, 12/31/14		5,810		5,548,550
Verso Paper Holdings LLC:
11.50%, 7/01/14 (b)		335		351,750
Series B, 4.00%, 8/01/14 (d)		280		226,100
Series B, 9.13%, 8/01/14		325		299,000
				10,414,985
Pharmaceuticals — 1.4%
Angiotech Pharmaceuticals, Inc., 4.00%, 12/01/13 (d)		1,050		850,500
Elan Corp. Plc, 8.75%, 10/15/16 (b)		740		717,800
Elan Finance Plc, 8.88%, 12/01/13		105		106,575
Novasep Holding SAS, 9.63%, 12/15/16 (b)	EUR	958		1,206,631
Valeant Pharmaceuticals International, 8.38%, 6/15/16 (b)	USD	545		564,075
				3,445,581
Real Estate Management & Development — 0.5%
Forest City Enterprises, Inc., 7.63%, 6/01/15		1,425		1,282,500
Semiconductors & Semiconductor Equipment — 1.0%
Advanced Micro Devices, Inc., 8.13%, 12/15/17 (b)		1,250		1,265,625
Spansion, Inc., 3.79%, 6/01/13 (a)(b)(h)		1,215		1,202,850
				2,468,475
Software — 0.0%
BMS Holdings, Inc., 7.89%, 2/15/12 (b)(d)(g)		456		9,120
Specialty Retail — 1.5%
Asbury Automotive Group, Inc., 7.63%, 3/15/17		350		330,313
General Nutrition Centers, Inc., 10.75%, 3/15/15		595		601,694
Group 1 Automotive, Inc., 2.25%, 6/15/36 (e)(j)		1,055		825,537
Limited Brands, Inc., 8.50%, 6/15/19		785		840,931
United Auto Group, Inc., 7.75%, 12/15/16		1,110		1,058,662
				3,657,137
Textiles, Apparel & Luxury Goods — 1.5%
Levi Strauss & Co., 8.63%, 4/01/13	EUR	1,850		2,531,658
Quiksilver, Inc., 6.88%, 4/15/15	USD	1,350		1,150,875
				3,682,533
Wireless Telecommunication Services — 5.4%
Cricket Communications, Inc.:
9.38%, 11/01/14		995		990,025
10.00%, 7/15/15		1,890		1,913,625
7.75%, 5/15/16		220		223,575
Digicel Group Ltd. (b):
8.88%, 1/15/15		1,370		1,308,350
9.13%, 1/15/15 (g)		1,983		1,933,425
FiberTower Corp., 9.00%, 1/01/16		284		230,144
iPCS, Inc., 2.37%, 5/01/13 (d)		815		749,800
MetroPCS Wireless, Inc., 9.25%, 11/01/14		2,285		2,279,287
NII Holdings, Inc., 2.75%, 8/15/25 (e)		770		777,700
Nextel Communications, Inc.:
Series D, 7.38%, 8/01/15		60		55,350
Series E, 6.88%, 10/31/13		1,840		1,766,400
Series F, 5.95%, 3/15/14		110		99,825
Orascom Telecom Finance SCA, 7.88%, 2/08/14 (b)		275		242,000
Sprint Capital Corp., 6.88%, 11/15/28		1,270		962,025
				13,531,531
Total Corporate Bonds — 101.4%				253,274,708

Floating Rate Loan Interests (d)	Par  (000)		Value
Aerospace & Defense — 0.1%
Hawker Beechcraft Acquisition Co. LLC, Incremental Term Loan, 10.50%, 3/26/14	USD	274	$	250,482
Auto Components — 1.0%
Allison Transmission, Inc., Term Loan, 2.98% – 3.00%, 8/07/14		2,266		2,075,223
Dana Holding Corp., Term Advance, 4.48% – 6.50%, 1/30/15		401		390,756
				2,465,979
Automobiles — 2.7%
Ford Motor Co., Tranche B-1 Term Loan, 3.24% – 3.26%, 12/15/13		7,191		6,717,246
Building Products — 1.3%
CPG International I, Inc., Term Loan, 5.23%, 2/28/11		3,250		3,250,251
Capital Markets — 0.1%
Marsico Parent Co., LLC, Term Loan, 5.25% – 5.31%, 12/15/14		381		241,724
Chemicals — 1.1%
PQ Corp., Term Loan (First Lien), 3.48% – 3.50%, 7/30/14		739		675,956
Solutia Inc., Loan, 7.25%, 2/28/14		359		364,156
Tronox Worldwide LLC:
Tranche B-1 Term Loan, 9.00%, 6/24/10		1,261		1,294,219
Tranche B-2 Term Loan, 9.00%, 6/24/10		339		347,701
				2,682,032
Construction & Engineering — 0.8%
Safway Services LLC — Second Out Term Loan, 9.00%, 12/14/17		2,000		2,000,000
Consumer Finance — 0.7%
Chrysler Financial Services Americas LLC Term Loan (First Lien), 4.24%, 8/03/12		1,760		1,737,762
Diversified Telecommunication Services — 1.9%
Wind Finance SL SA, Facility (Second Lien), 7.67%, 12/17/14	EUR	3,460		4,692,418
Food & Staples Retailing — 0.5%
Rite Aid Corp., Tranche 4 Term Loan, 9.50%, 6/10/15	USD	1,250		1,295,000
Hotels, Restaurants & Leisure — 1.2%
Travelport LLC (fka Travelport, Inc.), Loan, 8.25%, 3/27/12		3,198		2,926,337
IT Services — 0.1%
First Data Corp., Initial Tranche B-1 Term Loan, 2.98%, 9/24/14		347		303,387
Independent Power Producers & Energy Traders — 1.2%
Texas Competitive Electric Holdings Co., LLC (TXU):
Initial Tranche B-1 Term Loan, 3.73% – 3.75%, 10/10/14		216		173,742
Initial Tranche B-2 Term Loan, 3.73% – 3.75%, 10/10/14		656		527,672
Initial Tranche B-3 Term Loan, 3.73% – 3.75%, 10/10/14		2,821		2,257,000
				2,958,414
Media — 2.3%
Affinion Group Holdings, Inc., Loan, 8.39%, 3/01/12		436		412,302
Cengage Learning Acquisitions, Inc. (Thomson Learning), Tranche 1 Incremental Term Loan, 7.50%, 7/03/14		1,724		1,706,513
HMH Publishing Co. Ltd.:
Mezzanine, 1.26%, 11/14/14		570		70,241
Tranche A Term Loan, 5.48%, 6/12/14		1,557		1,309,580

See Notes to Financial Statements.
22	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Corporate High Yield Fund III, Inc. (CYE)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (d)	Par  (000)		Value
Media (concluded)
NVT Networks, LLC — Exit Term Loan, 13.00%, 10/01/12	USD	61		$61,276
Newsday, LLC, Fixed Rate Term Loan, 10.50%, 8/01/13		1,200		1,282,500
Protostar Ltd., Debtor in Possession Term Loan, 18.00%, 3/15/10		170		169,940
Virgin Media Investment Holdings Ltd., C Facility, 3.57%, 3/03/13	GBP	255		363,229
Worldcolor Press Inc. and Worldcolor (USA) Corp. (fka Quebecor World, Inc.), Advance, 9.00%, 7/23/12	USD	498		503,176
				5,878,757
Multiline Retail — 0.1%
The Neiman Marcus Group, Inc., Term Loan, 2.26%, 4/06/13		378		339,160
Oil, Gas & Consumable Fuels — 0.7%
Turbo Beta Ltd., Dollar Facility, 12.00%, 3/15/18		2,278		1,708,698
Paper & Forest Products — 0.3%
Verso Paper Finance Holdings LLC, PIK Loan, 7.25%, 2/01/13 (g)		1,296		712,711
Real Estate Management & Development — 0.2%
Realogy Corp.:
Initial Term B Loan, 3.25%, 10/10/13		400		352,616
Synthetic Letter of Credit, 0.08%, 10/10/13		128		113,185
				465,801
Specialty Retail — 0.3%
Claire’s Stores, Inc., Term B Loan, 3.00%, 5/29/14		279		230,219
Michaels Stores, Inc., B-1 Term Loan, 2.50% – 2.56%, 10/31/13		374		336,864
Pedalgreen Ltd., PIK Loan Facility, 0.00%, 11/30/15 (g)	GBP	233		326,444
				893,527
Total Floating Rate Loan Interests — 16.6%				41,519,686

Other Interests (k)		Beneficial Interest (000)
Auto Components — 1.9%
Delphi Debtor in Possession Holding Co. LLP, Class B Membership Interests (a)	USD	—	(l)	4,695,239
Lear Corp. Escrow (a)		460		6,900
				4,702,139
Hotels, Restaurants & Leisure — 0.0%
Buffets, Inc. (a)		575		58
Media — 0.0%
Adelphia Escrow (a)		750		75
Adelphia Recovery Trust (a)		941		3,762
				3,837
Total Other Interests — 1.9%				4,706,034

Preferred Stocks	Shares
Diversified Financial Services — 0.9%
Citigroup, Inc. (e)		16,700	1,791,242
GMAC, Inc. (b)		590	417,591
			2,208,833

Preferred Stocks	Shares		Value
Household Durables — 0.1%
Beazer Homes USA, Inc. (e)		10,132	$	238,735
Media — 0.0%
CMP Susquemanna Radio Holdings Corp. (a)(b)(d)		37,314		1
Total Preferred Stocks — 1.0%				2,447,569

Warrants (m)
Construction & Engineering — 0.0%
Safway US LLC (Expires 12/14/17)	367	—
Containers & Packaging — 0.0%
MDP Acquisitions Plc (Expires 10/01/13)	700	29,996
Health Care Providers & Services — 0.0%
HealthSouth Corp. (Expires 1/16/14)	32,042	—
Hotels, Restaurants & Leisure — 0.0%
Buffets Restaurants Holdings, Inc. (Expires 4/29/14)	485	5
Media — 0.0%
CMP Susquehanna Radio Holdings Corp. (Expires 3/26/19) (b)	42,640	1
New Vision Holdings LLC (Expires 9/30/14)	22,447	224
		225
Oil, Gas & Consumable Fuels — 0.0%
Turbo Cayman Ltd. (No Expiration)	1	—
Total Warrants — 0.0%		30,226
Total Long-Term Investments (Cost — $320,023,321) — 125.5%		313,338,639

Short-Term Securities
BlackRock Liquidity Funds, TempFund, Institutional Class, 0.09% (n)(o)	3,276,755	3,276,755
Total Short-Term Securities (Cost — $3,276,755) — 1.3%		3,276,755

Options Purchased	Contracts
Over-the-Counter Call Options — 0.0%
Marsico Parent Superholdco LLC, Strike Price USD 942.86, Expires 12/01/19, Broker Goldman Sachs Bank USA		19		3,610
Total Options Purchased (Cost — $18,578) — 0.0%				3,610
Total Investments (Cost — $323,318,654*) — 126.8%				316,619,004
Liabilities in Excess of Other Assets — (26.8)%				(66,898,435	)
Net Assets — 100.0%			$	249,720,569

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	23

Schedule of Investments (continued) BlackRock Corporate High Yield Fund III, Inc. (CYE)

* The cost and unrealized appreciation (depreciation) of investments as of February 28, 2010, as computed for federal income tax purposes, were as follows:

Aggregate cost	$	324,491,999
Gross unrealized appreciation	$	14,881,448
Gross unrealized depreciation		(22,754,443	)
Net unrealized depreciation	$	(7,872,995	)

(a)	Non-income producing security.
(b)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)	All or a portion of security has been pledged as collateral in connection with swaps.
(d)	Variable rate security. Rate shown is as of report date.
(e)	Convertible security.
(f)	Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.
(g)	Represents a payment-in-kind security which may pay interest/dividends in additional face/shares.
(h)	Issuer filed for bankruptcy and/or is in default of interest payments.
(i)	When-issued security. Unsettled when-issued security transactions were as follows:

Counterparty	Value		Unrealized Appreciation
Citigroup Global	$	620,000		—
JPMorgan Securities	$	440,000		—
Morgan Stanley Capital Services, Inc.	$	2,030,000		—
Wells Fargo Bank	$	164,200	$	4,200

(j)	Represents a step-down bond that pays an initial coupon rate for the first period and then a lower coupon rate for the following periods. Rate shown is as of report date.
(k)	Other interests represent beneficial interest in liquidation trusts and other reorganization entities and are non-income producing.
(l)	Amount is less than $1,000.
(m)	Warrants entitle the Fund to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date.
(n)	Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows:

Affiliate	Net Activity			Income
BlackRock Liquidity Funds, TempFund, Institutional Class	$	3,276,755		$	6,161
BlackRock Liquidity Series, LLC Cash Sweep Series	$	(8,370,522	)	$	2,506

(o)	Represents the current yield as of report date.
•	Foreign currency exchange contracts as of February 28, 2010 were as follows:

Currency Purchased		Currency Sold		Counterparty	Settlement Date	Unrealized Appreciation (Depreciation)
EUR	341,000	USD	465,087	Citibank NA	3/03/10	$	(767	)
EUR	1,097,900	USD	1,513,552	Citibank NA	3/24/10		(18,661	)
USD	22,814,703	EUR	15,795,000	Citibank NA	3/24/10		1,308,369
USD	549,200	CAD	574,500	Goldman Sachs International	4/21/10		3,252
USD	94,238	GBP	60,000	Citibank NA	4/21/10		2,786
USD	667,914	GBP	414,000	Deutsche Bank AG	4/21/10		36,897
USD	1,790,620	GBP	1,106,000	Morgan Stanley Capital Services, Inc.	4/21/10		104,860
Total						$	1,436,736

• Credit default swaps on single-name issues — buy protection outstanding as of February 28, 2010 were as follows:

Issuer	Pay Fixed Rate		Counterparty	Expiration	Notional Amount (000)		Unrealized Appreciation (Depreciation)
Beazer Homes USA, Inc.	5.00	%	Credit Suisse International	December 2011	USD	500	$	(8,468	)
K. Hovnanian Enterprises, Inc.	5.00	%	Goldman Sachs Bank USA	December 2011	USD	510		(3,283	)
K. Hovnanian Enterprises, Inc.	5.00	%	Goldman Sachs Bank USA	December 2013	USD	1,000		(34,988	)
Louisiana-Pacific Corp.	5.00	%	JPMorgan Chase Bank NA	March 2014	USD	500		(131,515	)
Brunswick Corp.	5.00	%	Goldman Sachs Bank USA	September 2014	USD	200		(5,653	)
Centex Corp.	1.00	%	Deutsche Bank AG	September 2014	USD	188		1,043
Limited Brands, Inc.	1.00	%	Goldman Sachs Bank USA	September 2014	USD	850		(29,796	)
Limited Brands, Inc.	1.00	%	JPMorgan Chase Bank NA	September 2014	USD	100		(3,435	)
American Axle and Manufacturing Inc.	5.00	%	Deutsche Bank AG	December 2014	USD	375		(2,807	)
Boston Scientific Corp.	1.00	%	Goldman Sachs Bank USA	December 2014	USD	525		965
Total							$	(217,937	)

• Credit default swaps on single-name issues — sold protection outstanding as of February 28, 2010 were as follows:

Issuer	Receive Fixed Rate		Counterparty	Expiration	Credit Rating1	Notional Amount (000)2	Unrealized Appreciation (Depreciation)
Advanced Micro Devices, Inc.	5.00	%	JPMorgan Chase Bank NA	March 2015	B–	USD 600	$	2,241
Realogy Corp.	5.00	%	Credit Suisse International	March 2015	C	USD 100		1,285
Realogy Corp.	5.00	%	JPMorgan Chase Bank NA	March 2015	C	USD 475		(15,335	)
Standard Pacific Corp.	5.00	%	Goldman Sachs International	March 2015	CCC	USD 275		(246	)
Total							$	(12,055	)

1	Using S&P’s rating of the issuer.
2	The maximum potential amount the Fund may pay should a negative credit event take place as defined under the terms of the agreement.

See Notes to Financial Statements.
24	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (concluded) BlackRock Corporate High Yield Fund III, Inc. (CYE)

•	Fair Value Measurements — Various inputs are used in determining the fair value of investments, which are as follows:
	•	Level 1 — price quotations in active markets/exchanges for identical assets and liabilities
	•	Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)
	•	Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments)
	The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

The following tables summarize the inputs used as of February 28, 2010 in determining the fair valuation of the Fund’s investments:

	Investments in Securities
Valuation Inputs	Level 1		Level 2		Level 3		Total
Assets:
Long-Term Investments:
Common Stocks	$	10,749,192	$	531,478	$	79,746	$	11,360,416
Corporate Bonds		—		249,028,689		4,246,019		253,274,708
Floating Rate Loan Interests		—		20,383,700		21,135,986		41,519,686
Other Interests		—		6,901		4,699,133		4,706,034
Preferred Stocks		1,791,242		656,326		1		2,447,569
Warrants		—		29,996		230		30,226
Short-Term Securities		3,276,755		—		—		3,276,755
Total	$	15,817,189	$	270,637,090	$	30,161,115	$	316,615,394

	Other Financial Instruments1
Valuation Inputs	Level 1		Level 2			Level 3			Total
Assets		—	$	1,465,308		$	95		$	1,465,403
Liabilities		—		(254,954	)		(115,674	)		(370,628	)
Total		—	$	1,210,354		$	(115,579	)	$	1,094,775

¹ Other financial instruments are swaps, foreign currency exchange contracts, options and unfunded loan commitments. Swaps, foreign currency exchange contracts and unfunded loan commitments are shown at the unrealized appreciation/depreciation on the instrument and options are shown at market value.

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Investments in Securities
	Common Stocks		Corporate Bonds			Floating Rate Loan Interests			Other Interests		Preferred Stocks		Warrants		Total
Balance, as of February 28, 2009	$	381	$	1,607,922		$	16,334,395		$	3,837		—		—	$	17,946,535
Accrued discounts/premiums		—		—			—			—		—		—		—
Realized gain (loss)		—		(9,744	)		(5,723,498	)		—		—		—		(5,733,242	)
Change in unrealized appreciation/depreciation2		—		327,640			18,944,871			—	$	1		—		19,272,512
Net purchases (sales)		—		6,293			(8,381,378	)		—		—		—		(8,375,085	)
Net transfers in (out) of Level 3		79,365		2,313,908			(38,404	)		4,695,296		—	$	230		7,050,395
Balance, as of February 28, 2010	$	79,746	$	4,246,019		$	21,135,986		$	4,699,133	$	1	$	230	$	30,161,115

² Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in unrealized appreciation/depreciation on securities still held at February 28, 2010 was $9,380,836.

The following table is a reconciliation of Level 3 other financial instruments for which significant unobservable inputs were used to determine fair value:

	Other Financial Instruments3
	Assets		Liabilities			Total
Balance, as of February 28, 2009		—		—			—
Accrued discounts/premiums		—		—			—
Realized gain (loss)		—		—			—
Change in unrealized appreciation/depreciation4	$	95	$	(115,674	)	$	(115,579	)
Net purchases (sales)		—		—			—
Net transfers in (out) of Level 3		—		—			—
Balance, as of February 28, 2010	$	95	$	(115,674	)	$	(115,579	)

3	Other financial instruments are unfunded loan commitments.
4	Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in unrealized appreciation/depreciation on the securities still held at February 28, 2010 was $(115,579).

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	25

Schedule of Investments February 28, 2010	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Common Stocks	Shares		Value
Auto Components — 0.1%
Lear Corp. (a)		6,842	$	473,946
Building Products — 0.7%
Masonite Worldwide Holdings (a)		71,958		3,022,236
Neenah Enterprises Inc. (a)		144,858		2,897
				3,025,133
Chemicals — 0.1%
GEO Specialty Chemicals, Inc. (a)		339,340		130,273
Wellman Holdings, Inc. (a)		5,373		1,343
				131,616
Communications Equipment — 0.9%
Loral Space & Communications Ltd. (a)		116,985		3,805,522
Construction Materials — 0.0%
Nortek, Inc. (a)		2,970		109,890
Containers & Packaging — 1.3%
Smurfit Kappa Plc (a)		36,342		299,552
Viskase Cos., Inc. (a)		1,428,423		4,999,480
				5,299,032
Electrical Equipment — 0.0%
Medis Technologies Ltd. (a)		286,757		20,360
SunPower Corp., Class B (a)		4,892		79,886
				100,246
Hotels, Restaurants & Leisure — 0.0%
Buffets Restaurants Holdings,Inc. (a)		2,753		15,554
HRP Corp., Class B (a)(b)(c)		5,000		50
Lodgian, Inc. (a)		27,787		68,912
				84,516
Paper & Forest Products — 1.3%
Ainsworth Lumber Co. Ltd. (a)		1,190,019		2,499,470
Ainsworth Lumber Co. Ltd. (a)(b)		1,335,501		2,805,034
Western Forest Products, Inc. (a)(b)		211,149		44,148
				5,348,652
Software — 0.0%
Euramax International (a)		2,337		70,119
Specialty Retail — 0.0%
Movie Gallery, Inc. (a)		503,737		35,262
Total Common Stocks — 4.4%				18,483,934
Corporate Bonds	Par (000)
Aerospace & Defense — 0.5%
TransDigm, Inc., 7.75%, 7/15/14 (b)	USD	2,000		2,000,000
Airlines — 0.5%
Delta Air Lines, Inc., Series B, 9.75%, 12/17/16		1,000		1,030,000
United Air Lines, Inc., 12.75%, 7/15/12		800		848,000
				1,878,000

Corporate Bonds	Par (000)		Value
Auto Components — 0.2%
The Goodyear Tire & Rubber Co., 8.63%, 12/01/11	USD	900	$	933,750
Venture Holdings Co. LLC (a)(d):
12.00%, 6/01/09		4,450		—
Series B, 9.50%, 7/01/05 (e)		1,800		180
				933,930
Biotechnology — 0.1%
QHP Pharma, 10.25%, 3/15/15 (b)		590		602,319
Building Products — 2.6%
Building Materials Corp. of America, 7.00%, 2/15/20 (b)		1,300		1,300,000
CPG International I, Inc.:
7.18%, 7/01/12 (f)		7,500		7,125,000
10.50%, 7/01/13		1,300		1,274,000
Ply Gem Industries, Inc., 11.75%, 6/15/13		1,050		1,065,750
				10,764,750
Capital Markets — 0.5%
E*Trade Financial Corp., 4.00%, 8/31/19 (b)(g)		593		901,360
MU Finance Plc, 8.75%, 2/01/17 (b)	GBP	698		984,493
				1,885,853
Chemicals — 2.9%
American Pacific Corp., 9.00%, 2/01/15 (b)	USD	1,490		1,471,375
GEO Specialty Chemicals, Inc. (b):
7.50%, 3/31/15 (c)(h)		4,171		2,711,012
10.00%, 3/31/15 (f)		4,106		2,668,640
Hexion Finance Escrow LLC, 8.88%, 2/01/18 (b)		975		911,625
Huntsman International LLC, 5.50%, 6/30/16 (b)		900		792,000
Wellman Holdings, Inc. (h):
Second Lien Subordinate Note, 10.00%, 1/29/19 (b)		2,978		2,978,000
Third Lien Subordinate Note, 5.00%, 1/29/19 (c)		953		476,964
				12,009,616
Commercial Banks — 0.1%
Glitnir Banki HF (a)(d):
4.15%, 4/20/10 (b)		184		47,840
6.38%, 9/25/12 (b)		1,115		289,900
Series EMTN, 5.07%, 1/27/10	EUR	50		17,701
Series EMTN, 3.00%, 6/30/10		75		26,042
Series GMTN, 4.38%, 2/05/10		85		30,093
				411,576
Commercial Services & Supplies — 1.0%
ACCO Brands Corp., 10.63%, 3/15/15 (b)	USD	660		717,420
Clean Harbors, Inc., 7.63%, 8/15/16		1,200		1,212,000
RSC Equipment Rental, Inc., 10.00%, 7/15/17 (b)		970		1,037,900
The Geo Group, Inc., 7.75%, 10/15/17 (b)		850		860,625
West Corp., 9.50%, 10/15/14		340		337,450
				4,165,395
Communications Equipment — 0.0%
Brocade Communications Systems, Inc., 6.88%, 1/15/20 (b)		165		168,300
Construction Materials — 0.8%
Nortek, Inc., 11.00%, 12/01/13		2,983		3,132,359
Consumer Finance — 0.9%
Credit Acceptance Corp., 9.13%, 2/01/17 (b)		570		567,150
Ford Motor Credit Co. LLC, 3.24% – 3.26%, 1/13/12 (f)		2,680		2,512,500
Inmarsat Finance Plc, 7.38%, 12/01/17 (b)		725		743,125
				3,822,775

See Notes to Financial Statements.
26	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par (000)	Value
Containers & Packaging — 2.9%
Berry Plastics Escrow LLC, 8.25%, 11/15/15 (b)	USD	2,100	$	2,094,750
Berry Plastics Holding Corp., 8.88%, 9/15/14		215		206,937
Beverage Packaging Holdings Luxembourg II SA, 8.00%, 12/15/16	EUR	500		650,191
Crown Americas LLC, 7.63%, 5/15/17 (b)	USD	710		738,400
Graphic Packaging International, Inc., 9.50%, 6/15/17		975		1,023,750
Packaging Dynamics Finance Corp., 10.00%, 5/01/16 (b)		1,920		1,528,800
Smurfit Kappa Acquisitions (b):
7.25%, 11/15/17	EUR	830		1,107,571
7.75%, 11/15/19		785		1,063,555
Smurfit Kappa Funding Plc, 7.75%, 4/01/15	USD	3,325		3,225,250
Solo Cup Co., 10.50%, 11/01/13		440		460,900
				12,100,104
Diversified Financial Services — 4.9%
Archimedes Funding III Ltd., 5.50%, 11/29/11 (b)		5,744		2,584,661
CIT Group, Inc., 7.00%, 5/01/17		4,750		4,197,812
FCE Bank Plc, 7.13%, 1/16/12	EUR	3,250		4,386,438
GMAC Inc., 5.38%, 6/06/11		436		578,840
GMAC LLC:
7.25%, 3/02/11	USD	148		149,295
6.88%, 9/15/11		900		900,000
6.88%, 8/28/12		750		742,500
6.75%, 12/01/14		2,480		2,368,400
8.30%, 2/12/15 (b)		700		706,125
8.00%, 11/01/31		1,530		1,411,425
Preferred Term Securities VI, Ltd., 2.05%, 7/01/32 (a)(b)		35,000		1,750
Reynolds Group DL Escrow, Inc., 7.75%, 10/15/16 (b)		1,400		1,417,500
Reynolds Group Issuer, Inc., 7.75%, 10/15/16 (b)	EUR	650		882,872
Saturns Investments Europe Plc, 6.19%, 6/09/14	USD	480		336,000
				20,663,618
Diversified Telecommunication Services — 2.3%
Cincinnati Bell, Inc., 8.25%, 10/15/17		1,600		1,600,000
Nordic Telephone Co. Holdings ApS, 8.88%, 5/01/16 (b)		390		417,300
PAETEC Holding Corp.:
8.88%, 6/30/17		349		351,618
8.88%, 6/30/17 (b)		2		1,889
Qwest Corp., 8.38%, 5/01/16		4,000		4,380,000
Windstream Corp., 7.88%, 11/01/17		3,100		3,030,250
				9,781,057
Electric Utilities — 0.3%
NSG Holdings LLC, 7.75%, 12/15/25 (b)		1,505		1,301,825
Electronic Equipment, Instruments & Components — 0.0%
Muzak Holdings, LLC, 13.00%, 3/15/10 (a)(d)		2,675		268
Energy Equipment & Services — 0.5%
Expro Finance Luxembourg SCA, 8.50%, 12/15/16 (b)		2,000		1,990,000
Food & Staples Retailing — 0.1%
Duane Reade, Inc., 11.75%, 8/01/15		280		352,800
Food Products — 0.9%
B&G Foods, Inc., 7.63%, 1/15/18		900		909,000
Bumble Bee Foods LLC, 7.75%, 12/15/15 (b)		730		731,825
Smithfield Foods, Inc., 10.00%, 7/15/14 (b)		1,850		2,002,625
				3,643,450

Corporate Bonds		Par (000)	Value
Health Care Equipment & Supplies — 0.3%
DJO Finance LLC, 10.88%, 11/15/14	USD	1,345	$	1,439,150
Health Care Providers & Services — 2.1%
Community Health Systems, Inc., Series WI, 8.88%, 7/15/15		3,010		3,115,350
DaVita, Inc., 7.25%, 3/15/15		980		983,675
Tenet Healthcare Corp. (b):
9.00%, 5/01/15		680		712,300
8.88%, 7/01/19		2,290		2,415,950
Vanguard Health Holding Co.II LLC, 8.00%, 2/01/18 (b)		1,470		1,444,275
				8,671,550
Health Care Technology — 0.8%
IMS Health, Inc., 12.50%, 3/01/18 (b)		2,980		3,427,000
Hotels, Restaurants & Leisure — 2.3%
HRP Myrtle Beach Holdings LLC, 14.50%, 4/01/14 (a)(b)(d)		6,892		689
HRP Myrtle Beach Operations LLC (a)(b)(d):
7.38%, 4/01/12		5,000		500
12.50%, 4/01/13		5,000		500
Icahn Enterprises LP (b):
7.75%, 1/15/16		1,500		1,410,000
8.00%, 1/15/18		3,000		2,820,000
Little Traverse Bay Bands of Odawa Indians, 10.25%, 2/15/14 (a)(b)(d)		2,560		646,400
MGM Mirage:
13.00%, 11/15/13		430		490,200
11.13%, 11/15/17 (b)		1,340		1,447,200
Shingle Springs Tribal Gaming Authority, 9.38%, 6/15/15 (b)		380		302,100
Snoqualmie Entertainment Authority, 4.14%, 2/01/14 (b)(f)		1,015		690,200
Travelport LLC, 4.88%, 9/01/14 (f)		2,160		2,008,800
Tropicana Entertainment LLC, Series WI, 9.63%, 12/15/14 (a)(d)		530		331
				9,816,920
Household Durables — 1.3%
Beazer Homes USA, Inc., 12.00%, 10/15/17 (b)		1,700		1,895,500
K. Hovnanian Enterprises, Inc., 10.63%, 10/15/16		2,245		2,346,025
KB Home, 6.38%, 8/15/11		180		183,150
Standard Pacific Corp.:
6.25%, 4/01/14		315		283,500
7.00%, 8/15/15		600		540,000
				5,248,175
Household Products — 0.1%
Libbey Glass, Inc., 10.00%, 2/15/15 (b)		220		227,700
IT Services — 0.4%
First Data Corp.:
9.88%, 9/24/15		145		125,425
11.25%, 3/31/16		605		496,100
SunGard Data Systems, Inc., 4.88%, 1/15/14		1,265		1,181,194
				1,802,719
Independent Power Producers & Energy Traders — 2.9%
The AES Corp., 8.75%, 5/15/13 (b)		625		635,938
AES Eastern Energy LP, Series 99-B, 9.67%, 1/02/29		1,010		1,094,587
Calpine Construction Finance Co. LP, 8.00%, 6/01/16 (b)		1,750		1,771,875

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	27

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par (000)	Value
Independent Power Producers & Energy Traders (concluded)
Energy Future Holdings Corp.:
11.25%, 11/01/17 (c)	USD	1,835	$	1,284,864
10.00%, 1/15/20 (b)		1,200		1,224,000
NRG Energy, Inc.:
7.25%, 2/01/14		5,500		5,541,250
8.50%, 6/15/19		800		799,000
				12,351,514
Industrial Conglomerates — 1.6%
Sequa Corp. (b):
11.75%, 12/01/15		2,850		2,793,000
13.50%, 12/01/15 (c)		4,023		4,032,902
				6,825,902
Insurance — 0.9%
Alliant Holdings I, Inc., 11.00%, 5/01/15 (b)		2,500		2,543,750
USI Holdings Corp., 4.13%, 11/15/14 (b)(f)		1,630		1,348,825
				3,892,575
Leisure Equipment & Products — 0.3%
Brunswick Corp., 11.25%, 11/01/16 (b)		1,225		1,362,813
Machinery — 1.9%
ESCO Corp., 4.13%, 12/15/13 (b)(f)		3,070		2,716,950
Navistar International Corp., 5.21% – 8.47%, 11/01/21		2,000		2,030,000
RBS Global, Inc., 8.88%, 9/01/16		1,685		1,524,925
Titan International, Inc., 8.00%, 1/15/12		1,530		1,522,350
				7,794,225
Marine — 0.2%
Navios Maritime Holdings, Inc., 8.88%, 11/01/17 (b)		840		854,700
Media — 6.9%
Affinion Group, Inc., 10.13%, 10/15/13		2,010		2,030,100
CSC Holdings, Inc., 8.50%, 4/15/14 (b)		680		714,850
Canadian Satellite Radio Holdings, Inc., 12.75%, 2/15/14		5,000		3,000,000
Clear Channel Worldwide Holdings, Inc., 9.25%, 12/15/17 (b)		4,021		4,126,785
DISH DBS Corp., 7.00%, 10/01/13		2,000		2,045,000
Intelsat Corp., 9.25%, 8/15/14		4,500		4,635,000
Network Communications, Inc., 10.75%, 12/01/13		20		9,200
Nielsen Finance LLC, 11.63%, 2/01/14		3,700		4,120,875
Seat Pagine Gialle SpA, 10.50%, 1/31/17 (b)	EUR	1,435		1,808,796
TL Acquisitions, Inc., 10.50%, 1/15/15 (b)	USD	3,680		3,353,400
UPC Germany GmbH, 8.13%, 12/01/17 (b)		3,000		3,000,000
				28,844,006
Metals & Mining — 1.9%
Aleris International, Inc. (a)(d):
9.00%, 12/15/14		1,100		2,750
10.00%, 12/15/16		1,500		31,875
Murray Energy Corp., 10.25%, 10/15/15 (b)		790		790,988
RathGibson, Inc., 11.25%, 2/15/14 (a)(d)		4,440		1,426,350
Ryerson, Inc., 7.62%, 11/01/14 (f)(i)		3,595		3,208,537
Teck Resources Ltd., 10.75%, 5/15/19		1,875		2,306,250
				7,766,750

Corporate Bonds		Par (000)	Value
Multiline Retail — 0.6%
Dollar General Corp., 11.88%, 7/15/17 (c)	USD	1,775	$	2,063,437
Saks, Inc., 9.88%, 10/01/11		235		243,813
				2,307,250
Oil, Gas & Consumable Fuels — 2.5%
Arch Coal, Inc., 8.75%, 8/01/16 (b)		1,250		1,293,750
Atlas Energy Operating Co. LLC:
12.13%, 8/01/17		1,440		1,620,000
10.75%, 2/01/18		355		384,288
Crosstex Energy LP, 8.88%, 2/15/18 (b)		620		629,300
Denbury Resources, Inc.:
9.75%, 3/01/16		925		996,687
8.25%, 2/15/20		670		693,450
El Paso Corp., 7.00%, 6/15/17		1,500		1,504,603
Forest Oil Corp.:
8.50%, 2/15/14 (b)		470		485,275
7.25%, 6/15/19		150		147,000
Massey Energy Co., 6.88%, 12/15/13		1,300		1,290,250
OPTI Canada, Inc., 9.00%, 12/15/12 (b)		1,000		1,017,500
Titan Petrochemicals Group Ltd., 8.50%, 3/18/12 (b)		1,760		440,000
				10,502,103
Paper & Forest Products — 3.7%
Ainsworth Lumber Co. Ltd., 11.00%, 7/29/15 (b)(c)		4,206		3,133,876
Clearwater Paper Corp., 10.63%, 6/15/16 (b)		640		710,400
Georgia-Pacific LLC, 8.25%, 5/01/16 (b)		2,950		3,112,250
NewPage Corp.:
10.00%, 5/01/12		820		471,500
11.38%, 12/31/14		6,745		6,441,475
Verso Paper Holdings LLC:
11.50%, 7/01/14 (b)		550		577,500
Series B, 4.00%, 8/01/14 (f)		1,365		1,102,238
				15,549,239
Pharmaceuticals — 0.8%
Angiotech Pharmaceuticals, Inc., 4.00%, 12/01/13 (f)		1,770		1,433,700
Elan Corp. Plc, 8.75%, 10/15/16 (b)		965		936,050
Novasep Holding SAS, 9.63%, 12/15/16 (b)	EUR	862		1,085,716
				3,455,466
Real Estate Investment Trusts (REITs) — 0.2%
Omega Healthcare Investors, Inc., 7.50%, 2/15/20 (b)	USD	1,010		1,020,100
Semiconductors & Semiconductor Equipment — 1.1%
Advanced Micro Devices, Inc., 8.13%, 12/15/17 (b)		1,050		1,063,125
STATS ChipPAC Ltd.:
7.50%, 7/19/10		285		287,494
6.75%, 11/15/11		615		612,693
Spansion, Inc., 3.79%, 6/01/13 (a)(b)(d)		2,720		2,692,800
				4,656,112
Software — 0.1%
BMS Holdings, Inc., 7.89%, 2/15/12 (b)(c)		1,702		34,037
JDA Software Group, Inc., 8.00%, 12/15/14 (b)		282		290,460
				324,497
Specialty Retail — 0.5%
General Nutrition Centers, Inc., 10.75%, 3/15/15		910		920,238
United Auto Group, Inc., 7.75%, 12/15/16		1,380		1,316,175
				2,236,413

See Notes to Financial Statements.
28	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Corporate Bonds		Par (000)	Value
Textiles, Apparel & Luxury Goods — 0.5%
Levi Strauss & Co., 8.63%, 4/01/13	EUR	1,550	$	2,121,119
Wireless Telecommunication Services — 2.6%
Cricket Communications, Inc., 7.75%, 5/15/16	USD	3,250		3,302,812
Digicel Group Ltd., 9.13%, 1/15/15 (b)(c)		4,248		4,141,800
MetroPCS Wireless, Inc., 9.25%, 11/01/14		2,860		2,852,850
Orascom Telecom Finance SCA, 7.88%, 2/08/14 (b)		755		664,400
				10,961,862
Total Corporate Bonds — 58.5%				245,067,855
Floating Rate Loan Interests (f)
Aerospace & Defense — 0.1%
Hawker Beechcraft Acquisition Co. LLC, Incremental Term Loan, 10.50%, 3/26/14		474		432,650
Airlines — 0.5%
Delta Air Lines, Inc., Credit-Linked Deposit Loan, 0.08% – 2.25%, 4/30/12		1,960		1,830,967
Auto Components — 2.1%
Allison Transmission, Inc., Term Loan, 2.98% – 3.00%, 8/07/14		7,442		6,814,808
Dana Holding Corp., Term Advance, 4.48% – 6.50%, 1/30/15		1,245		1,212,928
The Goodyear Tire & Rubber Co., Loan (Second Lien), 2.34%, 4/30/14		750		695,938
Lear Corp. (Closing Date Loan & Delayed Draw Loan), 7.50%, 11/09/14		225		225,467
				8,949,141
Automobiles — 1.0%
Ford Motor Co.:
Tranche B-1 Term Loan, 3.24% – 3.26%, 12/15/13		1,985		1,839,298
Tranche B-2 Term Loan, 3.26%, 12/15/13		2,244		2,080,031
				3,919,329
Beverages — 0.2%
Culligan International Co., Loan (Second Lien), 5.17%, 4/24/13	EUR	1,500		844,226
Building Products — 1.7%
Building Materials Corp. of America:
Second Lien Term Loan, 6.00%, 9/15/14		2,425		2,386,200
Term Loan Advance, 3.00%, 2/22/14	USD	2,052		1,997,782
Goodman Global, Inc., Term Loan, 6.25%, 2/13/14		2,710		2,721,003
				7,104,985
Chemicals — 3.1%
Ashland Inc., Term B Borrowing, 7.65%, 5/13/14		548		554,127
Chemtura Corp., Term Facility, 6.00%, 1/26/11		1,600		1,607,000
Gentek Holding, LLC, Tranche B Term Loan, 7.00%, 10/29/14		800		804,000
Nalco Co., Term Loan, 6.50%, 5/13/16		1,716		1,728,390
PQ Corp., Term Loan (First Lien), 3.48% – 3.50%, 7/30/14		1,970		1,802,550
Rockwood Specialties Group, Inc., Term Loan H, 6.00%, 5/15/14		1,600		1,604,800
Solutia Inc., Loan, 7.25%, 2/28/14		2,384		2,415,505
Tronox Worldwide:
Tranche B-1 Term Loan, 9.00%, 6/24/10		2,049		2,103,106
Tranche B-2 Term Loan, 9.00%, 6/24/10		551		565,014
				13,184,492

Floating Rate Loan Interests (f)		Par (000)	Value
Commercial Services & Supplies — 1.5%
ARAMARK Corp., Facility Letter of Credit, 0.09%, 1/26/14	USD	116	$	111,093
ARAMARK Corp., US Term Loan, 2.13%, 1/26/14		1,771		1,689,250
Casella Waste Systems, Inc., Term B Loan, 7.00%, 4/09/14		388		390,475
John Maneely Co., Term Loan, 3.50%, 12/09/13		1,060		993,291
Synagro Technologies, Inc., Term Loan (First Lien), 2.23%, 4/02/14		790		696,395
West Corp., Incremental Term B-3 Loan, 7.25%, 10/24/13		2,240		2,262,706
				6,143,210
Construction & Engineering — 0.7%
Safway Services, LLC, First Out Term Loan, 9.00%, 12/14/17		2,750		2,750,000
Consumer Finance — 1.4%
Chrysler Financial Services Americas LLC, Term Loan (First Lien), 4.24% – 6.25%, 8/03/12		5,961		5,884,582
Containers & Packaging — 0.8%
Anchor Glass Term Loan B 6.00%, 2/18/16		1,300		1,295,938
Berry Plastics Holding Corp., Term C Loan, 2.25%, 4/03/15		898		803,185
Graham Packaging Co., LP, B Term Loan, 2.50%, 10/07/11		1,280		1,262,663
				3,361,786
Diversified Consumer Services — 1.9%
Coinmach Service Corp., Term Loan, 3.26%, 11/14/14		5,158		4,461,579
Laureate Education, Series A New Term Loan, 7.00%, 8/15/14		3,491		3,459,567
				7,921,146
Diversified Financial Services — 1.0%
CIT Group, Inc., Tranche 2A Term Loan, 9.50%, 1/20/12		3,002		3,075,686
Reynolds Group Holdings Inc., US Term Loan, 6.25%, 11/05/15		1,200		1,207,500
				4,283,186
Diversified Telecommunication Services — 1.6%
Cavtel Holdings, LLC, Term Loan, 8.50%, 12/31/12		871		745,227
Hawaiian Telcom Communications, Inc., Tranche C Term Loan, 4.75%, 5/30/14		4,594		3,456,770
Integra Telecom Holdings, Inc., Term Loan (First Lien), 10.50%, 8/31/13		1,617		1,615,720
US Telepacific Corp., Second Lien Term Loan, 7.75%, 7/25/15		775		776,453
				6,594,170
Electrical Equipment — 0.1%
Generac Acquisition Corp., Term Loan (First Lien), 2.75%, 11/10/13		408		373,906
Energy Equipment & Services — 0.8%
Dresser, Inc.:
Term Loan B, 2.48% – 2.50%, 5/04/15		162		151,218
Term Loan (Second Lien), 6.00%, 5/04/15		1,463		1,368,157
MEG Energy Corp., Tranche D Term Loan, 6.00%, 4/03/16		1,921		1,886,510
				3,405,885
Food & Staples Retailing — 2.1%
AB Acquisitions UK Topco 2 Ltd. (fka Alliance Boots), Facility B1, 3.54%, 7/09/15	GBP	1,700		2,322,156
DSW Holdings, Inc. — Loan, 4.25%, 3/02/12	USD	800		704,000

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	29

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (f)		Par (000)	Value
Food & Staples Retailing (concluded)
Pilot Travel Centers, Term Loan B, 3.50%, 11/18/15	USD	2,500	$	2,511,590
Rite Aid Corp., Tranche 4 Term Loan, 9.50%, 6/10/15		2,250		2,331,000
SUPERVALU Inc., Term B Advance, 1.48%, 6/02/12		1,084		1,051,009
				8,919,755
Food Products — 2.5%
Dole Food Co., Inc.:
Credit-Linked Deposit, 0.17%, 8/30/10		288		288,238
Term Loan B, 5.50%, 2/10/17		1,088		1,088,780
Term Loan C, 5.50%, 2/10/17		2,612		2,613,071
Tranche B Term Loan, 8.00%, 4/12/13		501		501,262
Pilgrim’s Pride Corp., Term Loan A, 0.00%, 12/01/12		1,000		985,000
Pinnacle Foods Finance LLC, Tranche C Term Loan, 7.50%, 4/02/14		3,200		3,213,142
Solvest, Ltd. (Dole), Tranche C Term Loan, 8.00%, 4/12/13		1,626		1,626,359
				10,315,852
Health Care Equipment & Supplies — 0.9%
Biomet, Inc., Dollar Term Loan, 3.23% – 3.25%, 3/25/15		648		627,124
DJO Finance LLC (ReAble Therapeutics Finance LLC), Term Loan, 3.23%, 5/20/14		3,096		2,991,927
				3,619,051
Health Care Providers & Services — 2.9%
CCS Medical, Inc. (Chronic Care), Loan Debtor In Possession, 15.00%, 3/31/10		31		31,247
CHS/Community Health Systems, Inc.:
Delayed Draw Term Loan, 2.50%, 7/25/14		181		168,725
Term Loan, 2.50%, 7/25/14		3,563		3,328,890
DaVita Inc., Tranche B-1 Term Loan, 1.73% – 1.76%, 10/05/12		600		585,975
Fresenius SE:
Tranche B1 Term Loan, 6.75%, 9/10/14		334		336,020
Tranche B2 Term Loan, 6.75%, 9/10/14		233		234,460
HCA Inc., Tranche A-1 Term Loan, 1.75%, 11/16/12		5,618		5,305,314
Vanguard Health Holding Company II, LLC (Vanguard Health Systems, Inc.), Initial Term Loan, 5.00%, 1/29/16		2,100		2,102,625
				12,093,256
Health Care Technology — 0.7%
IMS Healthcare, Term Loan B, 5.25%, 2/16/16		3,000		3,012,000
Hotels, Restaurants & Leisure — 4.2%
Blackstone UTP Capital LLC, Loan, 7.75%, 11/06/14		2,500		2,514,062
Cedar Fair LP, Term Loan B, 4.00%, 2/04/16		1,500		1,497,657
Green Valley Ranch Gaming, LLC, Loan (Second Lien), 3.50%, 8/16/14		750		75,000
Harrah’s Operating Co., Inc.:
Term B-1 Loan, 3.25%, 1/28/15		449		361,615
Term B-2 Loan, 3.25%, 1/28/15		565		455,917
Term B-4 Loan, 9.50%, 10/31/16		2,250		2,243,749
QCE, LLC (Quiznos), Term Loan (First Lien), 2.56%, 5/05/13		777		662,502
SW Acquisitions Co., Inc., Term Loan, 5.75%, 6/01/16		2,250		2,259,844
Six Flags Theme Parks, Inc., Term Loan, 4.50%, 6/13/15		5,500		5,449,125

Floating Rate Loan Interests (f)		Par (000)	Value
Hotels, Restaurants & Leisure (concluded)
VML US Finance LLC (aka Venetian Macau):
New Project Term Loan, 4.76%, 5/27/13	USD	834	$	792,351
Term B Delayed Draw Project Loan, 4.76%, 5/25/12		1,067		1,013,111
Term B Funded Project Loan, 4.76%, 5/27/13		185		175,777
				17,500,710
Household Durables — 0.7%
American Residential Services LLC, Term Loan (Second Lien), 10.00%, 4/17/15		3,091		2,974,962
IT Services — 1.8%
Audio Visual Services Group, Inc., Loan (Second Lien), 5.76%, 02/28/14		1,077		107,704
Ceridian Corp., US Term Loan, 3.23% – 3.25%, 11/09/14		2,935		2,566,444
First Data Corp., Initial Tranche B-2 Term Loan, 3.00%, 9/24/14		3,739		3,260,896
RedPrairie Corp.:
Tack-On Loan, 3.31%, 7/20/12		242		234,574
Term Loan B, 3.31%, 7/20/12		724		702,651
SunGard Data Systems Inc. (Solar Capital Corp.), Tranche B US Term Loan, 3.86% – 3.87%, 2/28/16		715		696,902
				7,569,171
Independent Power Producers & Energy Traders — 0.8%
Dynegy Holdings Inc.:
Term Letter of Credit Facility, 3.98%, 4/02/13		925		903,014
Tranche B Term Loan, 3.98%, 4/02/13		75		72,692
Texas Competitive Electric Holdings Co., LLC (TXU):
Initial Tranche B-2 Term Loan, 3.73% – 3.75%, 10/10/14		2,932		2,358,057
Initial Tranche B-3 Term Loan, 3.73% – 3.75%, 10/10/14		197		157,980
				3,491,743
Industrial Conglomerates — 0.3%
Sequa Corp., Term Loan, 3.51% – 3.94%, 12/03/14		1,394		1,274,633
Insurance — 0.1%
Alliant Holdings I, Inc., Term Loan, 3.25%, 8/21/14		594		560,516
Internet & Catalog Retail — 0.3%
FTD Group, Inc., Tranche B Term Loan, 6.75%, 8/26/14		1,212		1,211,801
Machinery — 1.2%
Accuride Corp., Term Loan, 9.75%, 1/31/12		2,045		2,040,740
Bucyrus International, Term Loan C, 4.50%, 1/26/16		1,500		1,507,950
Oshkosh Truck Corp., Term B Loan, 6.25% – 6.26%, 12/06/13		1,271		1,270,172
				4,818,862
Media — 10.1%
Affinion Group Holdings, Inc., Loan, 8.39%, 3/01/12		3,062		2,893,179
Cengage Learning Acquisitions, Inc. (Thomson Learning), Tranche 1 Incremental Term Loan, 7.50%, 7/03/14		2,539		2,513,500
Cequel Communications, LLC, Tranche B PIK Facility (Second Lien), 6.25%, 5/05/14		2,978		2,982,616

See Notes to Financial Statements.
30	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (f)		Par (000)	Value
Media (concluded)
Charter Communications Operating, LLC, New Term Loan, 2.23%, 3/06/14	USD	5,000	$	4,663,860
EB Sports Corp., Loan, 11.50%, 12/31/15		1,398		1,300,251
Ellis Communications KDOC, LLC, Loan, 10.00%, 12/30/11		6,303		1,764,771
HMH Publishing Co. Ltd.:
Mezzanine, 1.25%, 11/14/14		1,265		155,964
Tranche A Term Loan, 5.48%, 6/12/14		2,692		2,264,663
Hanley-Wood, LLC (FSC Acquisition), Term Loan, 2.50%, 3/10/14		744		332,449
Lamar Media Corp.:
Series B, Incremental Loan, 5.50% – 5.75%, 9/28/12		900		892,875
Term Loan, 5.50% – 5.75%, 9/28/12		1,543		1,531,495
Lavena Holding 3 GmbH (Prosiebensat.1 Media AG):
Facility B1, 3.34%, 6/30/15	EUR	337		314,143
Facility C1, 3.59%, 6/30/16		674		628,285
Mediacom Illinois, LLC (fka Mediacom Communications, LLC), Tranche D Term Loan, 5.50%, 3/31/17	USD	998		996,243
Multicultural Radio Broadcasting, Inc., Term Loan, 2.99%, 12/18/12		380		301,625
Newsday, LLC, Fixed Rate Term Loan, 10.50%, 8/01/13		4,250		4,542,188
Penton Media, Inc., Loan (Second Lien), 9.25%, 2/01/14 (a)(d)		1,000		133,333
Sinclair Television Group, Inc., Tranche B Term Loan, 6.50%, 10/29/15		1,000		1,005,000
Springer Science+Business Media SA, Facility A1, 6.75%, 7/01/16	EUR	1,900		2,556,962
Sunshine Acquisition Ltd. (aka HIT Entertainment), Term Facility, 2.50%, 3/20/12	USD	2,169		1,906,592
UPC Financing Partnership — Facility Term Loan, 3.93%, 12/30/16		2,000		1,944,000
Virgin Media Investment Holdings Ltd.:
B7 Facility, 4.40%, 9/03/12	GBP	23		34,747
C Facility, 4.40%, 9/03/12		516		766,740
C Facility, 3.58%, 7/17/13		1,975		2,813,241
Term Loan B, 3.57%, 9/03/12		621		923,066
Worldcolor Press Inc. and Worldcolor (USA) Corp. (fka Quebecor World, Inc.), Advance Term Loan, 9.00%, 7/23/12	USD	797		805,082
Yell Group Plc, TPI Term Loan A, 7.12%, 8/09/11		1,500		1,436,250
				42,403,120
Metals & Mining — 1.4%
Euramax International, Inc.:
Domestic Term Loan (Cash Pay), 10.00%, 6/29/13		1,286		1,042,012
Domestic Term Loan, 3.00% – 11.00%, 6/29/13		1,318		1,067,414
RathGibson, Inc., Loan Debtor In Possession, 10.75%, 6/30/10 (c)		3,665		3,665,418
				5,774,844
Multi-Utilities — 0.6%
Energy Transfer Equity, LP, Term Loan, 1.98%, 11/01/12		750		739,682
FirstLight Power Resources, Inc. (fka NE Energy, Inc.):
Synthetic Letter of Credit, 0.16%, 11/01/13		53		49,150
Term Advance (Second Lien), 4.81%, 5/01/14		750		688,750
Term B Advance (First Lien), 2.75%, 11/01/13		572		533,868
USPF Holdings, LLC, Term Loan, 1.98%, 4/11/14		607		599,897
				2,611,347

Floating Rate Loan Interests (f)		Par (000)	Value
Multiline Retail — 1.4%
Dollar General Corp., Tranche B-2 Term Loan, 2.98%, 7/07/14	USD	2,179	$	2,095,847
Hema Holding BV, Facility D, 5.42%, 1/01/17	EUR	2,900		3,316,994
The Neiman Marcus Group Inc., Term Loan, 2.26%, 4/06/13	USD	665		596,875
				6,009,716
Oil, Gas & Consumable Fuels — 1.9%
Big West Oil, LLC:
Delayed Advance Loan, 4.50%, 5/15/14		1,117		1,094,558
Initial Advance Loan, 4.50%, 5/15/14		888		870,391
Initial Advance Loan, 9.75%, 1/26/15		1,500		1,507,500
Turbo Beta Ltd., USD Mezzanine Facility, 14.50%, 3/15/18		6,110		4,582,418
				8,054,867
Paper & Forest Products — 0.7%
Georgia-Pacific LLC, Term Loan B, 2.25% – 2.26%, 12/23/12		803		784,309
Verso Paper Finance Holdings LLC, PIK Loan, 7.25%, 2/01/13 (c)		4,069		2,237,803
				3,022,112
Personal Products — 0.3%
American Safety Razor Co., LLC:
Loan (Second Lien), 6.51%, 1/30/14		1,075		628,875
Term Loan (First Lien), 2.75% – 2.76%, 7/31/13		749		679,511
				1,308,386
Pharmaceuticals — 1.0%
Warner Chilcott Co., LLC, Term A Loan, 5.50%, 10/30/14		1,220		1,220,034
Warner Chilcott Corp.:
Additional Term Loan, 5.75%, 4/30/15		930		930,253
Term B-1 Loan, 5.75%, 4/30/15		610		609,751
Term B-2 Loan, 5.75%, 4/30/15		1,342		1,341,452
				4,101,490
Professional Services — 0.4%
Booz Allen Hamilton Inc., Term Loan C, 6.00%, 7/31/15		1,750		1,755,469
Real Estate Management & Development — 0.7%
Enclave, First Lien Term Loan, 6.14%, 3/01/12 (a)(d)		4,000		434,252
Georgian Towers, B7, 6.14%, 3/01/12		4,000		413,472
Realogy Corp.:
Delayed Draw Term B Loan, 3.25%, 10/10/13		723		637,687
Term Loan (Second Lien), 13.50%, 10/15/17		1,500		1,631,250
				3,116,661
Specialty Retail — 0.8%
Adesa, Inc. (KAR Holdings, Inc.), Initial Term Loan, 2.98%, 10/21/13		814		785,205
Michaels Stores, Inc.:
B-1 Term Loan, 2.50% – 2.56%, 10/31/13		1,202		1,082,146
B-2 Term Loan, 4.75% – 4.81%, 7/31/16		1,448		1,379,487
				3,246,838
Wireless Telecommunication Services — 0.2%
MetroPCS Wireless, Inc., Tranche B Term Loan, 2.50%, 11/03/13		997		960,955
Total Floating Rate Loan Interests — 56.5%				236,711,778

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	31

Schedule of Investments (continued)	BlackRock Debt Strategies Fund, Inc. (DSU)
	(Percentages shown are based on Net Assets)

Other Interests (j)	Beneficial Interest (000)		Value
Airlines — 0.0%
Delta Air Lines, Inc. Default 8.33% Escrow	USD	5,505	$	96,888
Delta Air Lines, Inc. Default 10% Escrow		4,200		73,920
				170,808
Auto Components — 0.1%
Intermet Liquidating Trust Class A		1,354		394,800
Diversified Financial Services — 0.3%
J. G. Wentworth LLC Preferred Equity Interests		1		1,144,914
Hotels, Restaurants & Leisure — 0.0%
Buffets, Inc.		1,440		144
Household Durables — 0.2%
Stanley Martin Class B Membership Units		2		675,000
Media — 0.0%
Adelphia Escrow		7,500		750
Adelphia Preferred Escrow		5		1
Adelphia Recovery Trust		9,406		37,624
Adelphia Recovery Trust, Series ACC-6B INT		500		50
				38,425
Specialty Retail — 0.0%
Movie Gallery, Inc. Default Escrow		21,700		217
Total Other Interests — 0.6%				2,424,308
Warrants (k)		Shares
Building Products — 0.0%
Neenah Enterprises Inc. (Expires 9/30/13)		130,547		1
Health Care Providers & Services — 0.0%
HealthSouth Corp. (Expires 1/16/14)		126,761		1
Hotels, Restaurants & Leisure — 0.0%
Buffets Restaurants Holdings, Inc. (Expires 4/29/14)		1,216		12
Media — 0.0%
Charter Communications (Expires 11/30/14)		12,661		50,644
Oil, Gas & Consumable Fuels — 0.0%
Turbo Cayman Ltd. (No Expiration)		4		—
Specialty Retail — 0.0%
Movie Gallery, Inc. (Expires 5/15/15)		62,323		31,162
Total Warrants — 0.0%				81,820
Total Long-Term Investments (Cost — $596,533,280) — 120.0%				502,769,695
Short-Term Securities
BlackRock Liquidity Fund, TempFund, Institutional Class, 0.09% (l)(m)		1,319,723		1,319,723
Total Short-Term Securities (Cost — $1,319,723) — 0.3%				1,319,723
Total Investments (Cost — $597,853,003*) — 120.3%				504,089,418
Liabilities in Excess of Other Assets — (20.3)%				(84,867,430	)
Net Assets — 100.0%			$	419,221,988

* The cost and unrealized appreciation (depreciation) of investments as of February 28, 2010, as computed for federal income tax purposes, were as follows:

Aggregate cost	$	597,507,666
Gross unrealized appreciation	$	21,944,450
Gross unrealized depreciation		(115,158,398	)
Net unrealized depreciation	$	(93,213,948	)

(a)	Non-income producing security.
(b)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)	Represents a payment-in-kind security which may pay interest/dividends in additional face/shares.
(d)	Issuer filed for bankruptcy and/or is in default of interest payments.
(e)	As a result of bankruptcy proceedings, the company did not repay the principal amount or accrued interest of the security upon maturity.
(f)	Variable rate security. Rate shown is as of report date.
(g)	Represents a zero-coupon bond. Rate shown is as of report date.
(h)	Convertible security.
(i)	All or a portion of security has been pledged as collateral in connection with swaps.
(j)	Other interests represent beneficial interest in liquidation trusts and other reorganization entities and are non-income producing.
(k)	Warrants entitle the Fund to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date.
(l)	Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows:

Affiliate	Net Activity			Income
BlackRock Liquidity Funds, TempFund, Institutional Class	$	1,319,723		$	7,984
BlackRock Liquidity Series, LLC Cash Sweep Series	$	(4,725,260	)	$	735

(m)	Represents the current yield as of report date.
•	For Fund compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease. These industry classifications are unaudited.
•	Foreign currency exchange contracts as of February 28, 2010 were as follows:

Currency Purchased		Currency Sold		Counterparty	Settlement Date		Unrealized Appreciation (Depreciation)
EUR	105,400	USD	144,302	Citibank NA	3/24/10	$	(790	)
USD	24,007,201	EUR	16,660,000	Citibank NA	3/24/10		1,323,090
GBP	1,393,500	USD	2,186,698	Citibank NA	4/21/10		(62,733	)
USD	2,685,774	CAD	2,809,500	Goldman Sachs International	4/21/10		15,904
USD	2,218,791	GBP	1,389,000	Citibank NA	4/21/10		101,684
USD	1,104,318	GBP	684,500	Deutsche Bank AG	4/21/10		61,006
USD	2,410,698	GBP	1,489,000	Morgan Stanley Capital Services, Inc.	4/21/10		141,172
Total						$	1,579,333

See Notes to Financial Statements.
32	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (concluded) BlackRock Debt Strategies Fund, Inc. (DSU)

• Credit default swaps on single-name issues — buy protection outstanding as of February 28, 2010 were as follows:

Issuer	Pay Fixed Rate		Counterparty		Expiration		Notional Amount (000)		Unrealized Appreciation (Depreciation)
K. Hovnanian Enterprises, Inc.	5.00	%		Goldman Sachs Bank USA		December 2011		USD 855	$	(5,503	)
K. Hovnanian Enterprises, Inc.	5.00	%		Goldman Sachs Bank USA		December 2012		USD 425		2,917
Brunswick Corp.	5.00	%		Goldman Sachs Bank USA		September 2014		USD 325		(9,186	)
Boston Scientific Corp.	1.00	%		Goldman Sachs Bank USA		December 2014		USD 900		1,654
Total									$	(10,118	)

• Credit default swaps on single-name issues — sold protection outstanding as of February 28, 2010 were as follows:

Issuer	Receive Fixed Rate	Counterparty	Expiration	Credit Rating1	Notional Amount (000)2	Unrealized Depreciation
BAA Ferrovial Junior Term Loan	2.00%	Deutsche Bank AG	March 2012	A–	GBP 900	$	(94,696	)

1	Using S&P’s rating of the issuer.
2	The maximum potential amount the Fund may pay should a negative credit take place as defined under the terms of the agreement.

•	Fair Value Measurements — Various inputs are used in determining the fair value of investments, which are as follows:
	•	Level 1 — price quotations in active markets/exchanges for identical assets and liabilities
	•	Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, repayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)
	•	Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments)
	The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
	The following tables summarize the inputs used as of February 28, 2010 in determining the fair valuation of the Fund’s investments:

	Investments in Securities
Valuation Inputs	Level 1		Level 2		Level 3		Total
Assets:
Long-Term Investments:
Common Stocks	$	15,067,673	$	3,104,586	$	311,675	$	18,483,934
Corporate Bonds		—		233,262,647		11,805,208		245,067,855
Floating Rate Loan Interests		—		178,228,733		58,483,045		236,711,778
Other Interests		—		170,808		2,253,500		2,424,308
Warrants		—		50,645		31,175		81,820
Short-Term Securities		1,319,723		—		—		1,319,723
Total	$	16,387,396	$	414,817,419	$	72,884,603	$	504,089,418

	Other Financial Instruments3
Valuation Inputs		Level 1		Level 2			Level 3			Total
Assets		—	$	1,647,427			—		$	1,647,427
Liabilities		—		(78,212	)	$	(94,696	)		(172,908	)
Total		—	$	1,569,215		$	(94,696	)	$	1,474,519

³ Other financial instruments are swaps, foreign currency exchange contracts and options. Swaps and foreign currency exchange contracts are shown at the unrealized appreciation/depreciation on the instrument and options are shown at market value.

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Investments in Securities
	Common Stocks		Corporate Bonds			Floating Rate Loan Interests			Other Interests		Warrants		Total
Balance, as of February 28, 2009	$	131,666	$	12,983,142		$	92,859,804		$	38,643	$	31,161	$	106,044,416
Accrued discounts/premiums		—		—			—			—		—		—
Realized gain (loss)		—		(1,313,777	)		(38,579,562	)		—		—		(39,893,339	)
Change in unrealized appreciation/depreciation4		—		1,072,125			74,319,010			—		—		75,391,135
Net purchases (sales)		—		18,392			(64,102,827	)		—		—		(64,084,435	)
Net transfers in (out) of Level 3		180,009		(954,674	)		(6,013,380	)		2,214,857		14		(4,573,174	)
Balance, as of February 28, 2010	$	311,675	$	11,805,208		$	58,483,045		$	2,253,500	$	31,175	$	72,884,603

⁴ Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in the unrealized appreciation/depreciation on the securities still held on February 28, 2010 was $19,573,307.

The following table is a reconciliation of Level 3 other financial instruments for which significant unobservable inputs were used to determine fair value:

	Other Financial Instruments5
Balance, as of February 28, 2009	$	(249,620	)
Accrued discounts/premiums		—
Realized gain (loss)		—
Change in unrealized appreciation/depreciation6		154,924
Net purchases (sales)		—
Net transfers in/out of Level 3		—
Balance, as of February 28, 2010	$	(94,696	)

5	Other financial instruments are swaps.
6	Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in unrealized appreciation/depreciation on the securities still held at February 28, 2010 was $154,924.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	33

Schedule of Investments February 28, 2010	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Common Stocks		Shares	Value
Building Products — 0.3%
Masonite Worldwide Holdings (a)		10,036	$	421,512
Chemicals — 0.0%
GEO Specialty Chemicals, Inc. (a)		10,732		4,120
Wellman Holdings, Inc. (a)		181		45
				4,165
Construction Materials — 0.0%
Nortek, Inc. (a)		710		26,270
Electrical Equipment — 0.1%
Medis Technologies Ltd. (a)		13,053		927
SunPower Corp., Class B (a)		5,332		87,072
				87,999
Total Common Stocks — 0.4%				539,946
Corporate Bonds	Par (000)
Airlines — 0.2%
Delta Air Lines, Inc., Series B, 9.75%, 12/17/16	USD	300		309,000
Auto Components — 0.0%
Delphi International Holdings Unsecured, 12.00%, 10/06/14		16		16,153
Building Products — 2.4%
Building Materials Corp. of America, 7.00%, 2/15/20 (b)		425		425,000
CPG International I, Inc., 7.18%, 7/01/12 (c)		3,000		2,850,000
				3,275,000
Capital Markets — 0.4%
E*Trade Financial Corp., 4.00% 8/31/19 (b)(d)(e)		46		69,920
Marsico Parent Co., LLC, 10.63%, 1/15/16 (b)		593		356,541
Marsico Parent Holdco, LLC, 12.50%, 7/15/16 (b)(f)		253		56,062
Marsico Parent Superholdco, LLC, 14.50%, 1/15/18 (b)(f)		164		28,522
				511,045
Chemicals — 0.7%
GEO Specialty Chemicals, Inc.:
7.50%, 3/31/15 (b)(d)(f)		702		456,366
10.00%, 3/31/15		690		448,864
Wellman Holdings, Inc., Third Lien Subordinate Note, 5.00%, 1/29/19 (d)(f)		190		95,287
				1,000,517
Commercial Services & Supplies — 0.5%
Clean Harbors, Inc., 7.63%, 8/15/16		400		404,000
The Geo Group, Inc., 7.75%, 10/15/17 (b)		300		303,750
				707,750
Communications Equipment — 0.0%
Brocade Communications Systems, Inc., 6.88%, 1/15/20 (b)		55		56,100
Construction Materials — 0.5%
Nortek, Inc., 11.00%, 12/01/13		713		748,813
Consumer Finance — 0.6%
Credit Acceptance Corp., 9.13%, 2/01/17 (b)		190		189,050
Inmarsat Finance Plc, 7.38%, 12/01/17 (b)		675		691,875
				880,925

Corporate Bonds	Par (000)		Value
Containers & Packaging — 2.5%
Berry Plastics Escrow LLC, 8.25%, 11/15/15 (b)	USD	900	$	897,750
Clondalkin Acquisition BV, 2.25%, 12/15/13 (b)(c)		1,500		1,338,750
Crown European Holdings SA, 6.25%, 9/01/11	EUR	11		15,278
Owens Brockway Glass Container, Inc., 6.75%, 12/01/14		113		153,867
Packaging Dynamics Finance Corp., 10.00%, 5/01/16 (b)	USD	380		302,575
Smurfit Kappa Acquisitions (b):
7.25%, 11/15/17	EUR	275		366,966
7.75%, 11/15/19		265		359,035
				3,434,221
Diversified Financial Services — 2.6%
CIT Group, Inc., 7.00%, 5/01/17	USD	1,585		1,400,744
FCE Bank Plc, 7.13%, 1/16/12	EUR	400		539,869
GMAC, Inc., 8.30%, 2/12/15 (b)	USD	950		958,313
Reynolds Group DL Escrow, Inc., 7.75%, 10/15/16 (b)		400		405,000
Reynolds Group Issuer, Inc., 7.75%, 10/15/16 (b)	EUR	200		271,653
				3,575,579
Diversified Telecommunication Services — 1.7%
Cincinnati Bell, Inc., 8.25%, 10/15/17	USD	600		600,000
PAETEC Holding Corp., 8.88%, 6/30/17		125		125,937
Qwest Communications International, Inc., 8.00%, 10/01/15 (b)		300		310,500
Qwest Corp., 8.38%, 5/01/16		240		262,800
Windstream Corp., 7.88%, 11/01/17		1,000		977,500
				2,276,737
Energy Equipment & Services — 0.5%
Expro Finance Luxembourg SCA, 8.50%, 12/15/16 (b)		750		746,250
Food & Staples Retailing — 0.3%
AmeriQual Group LLC, 9.50%, 4/01/12 (b)		250		225,000
Duane Reade, Inc., 11.75%, 8/01/15		100		126,000
				351,000
Food Products — 1.0%
B&G Foods, Inc., 7.63%, 1/15/18		300		303,000
Bumble Bee Foods LLC, 7.75%, 12/15/15 (b)		240		240,600
Smithfield Foods, Inc., 10.00%, 7/15/14 (b)		760		822,700
				1,366,300
Health Care Equipment & Supplies — 0.5%
DJO Finance LLC, 10.88%, 11/15/14		685		732,950
Health Care Providers & Services — 1.8%
DaVita, Inc., 6.63%, 3/15/13		455		456,137
Tenet Healthcare Corp. (b):
9.00%, 5/01/15		95		99,513
8.88%, 7/01/19		1,335		1,408,425
Vanguard Health Holding Co. II LLC, 8.00%, 2/01/18 (b)		485		476,512
				2,440,587
Health Care Technology — 0.8%
IMS Health, Inc., 12.50%, 3/01/18 (b)		980		1,127,000
Hotels, Restaurants & Leisure — 1.9%
Icahn Enterprises LP (b):
7.75%, 1/15/16		500		470,000
8.00%, 1/15/18		1,000		940,000
Little Traverse Bay Bands of Odawa Indians, 10.25%, 2/15/14 (a)(b)(g)		1,565		395,162
Travelport LLC, 4.88%, 9/01/14 (c)		815		757,950
				2,563,112

See Notes to Financial Statements.
34	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Corporate Bonds	Par (000)		Value
Household Products — 0.1%
Libbey Glass, Inc., 10.00%, 2/15/15 (b)	USD	75	$	77,625
IT Services — 0.1%
First Data Corp., 9.88%, 9/24/15		225		194,625
Independent Power Producers & Energy Traders — 2.1%
Calpine Construction Finance Co. LP, 8.00%, 6/01/16 (b)		1,215		1,230,187
NRG Energy, Inc., 7.25%, 2/01/14		1,660		1,672,450
				2,902,637
Industrial Conglomerates — 0.9%
Sequa Corp. (b):
11.75%, 12/01/15		320		313,600
13.50%, 12/01/15 (f)		879		880,864
				1,194,464
Marine — 0.2%
Navios Maritime Holdings, Inc., 8.88%, 11/01/17 (b)		280		284,900
Media — 3.2%
Affinion Group, Inc., 10.13%, 10/15/13		555		560,550
CSC Holdings, Inc., 8.50%, 4/15/14 (b)		230		241,788
Clear Channel Worldwide Holdings, Inc., 9.25%, 12/15/17 (b)		1,334		1,369,095
DISH DBS Corp., 7.00%, 10/01/13		525		536,812
Seat Pagine Gialle SpA, 10.50%, 1/31/17 (b)	EUR	473		596,209
TL Acquisitions, Inc., 10.50%, 1/15/15 (b)	USD	175		159,469
UPC Germany GmbH, 8.13%, 12/01/17 (b)		1,000		1,000,000
				4,463,923
Metals & Mining — 0.4%
FMG Finance Property Ltd., 4.25%, 9/01/11 (b)(c)		180		177,300
Ryerson, Inc., 7.62%, 11/01/14 (c)		450		401,625
				578,925
Multiline Retail — 0.2%
Dollar General Corp., 11.88%, 7/15/17 (f)		235		273,188
Paper & Forest Products — 0.6%
NewPage Corp., 10.00%, 5/01/12		610		350,750
Verso Paper Holdings LLC, Series B, 4.00%, 8/01/14 (c)		495		399,713
				750,463
Pharmaceuticals — 0.8%
Angiotech Pharmaceuticals, Inc., 4.00%, 12/01/13 (c)		300		243,000
Elan Finance Plc, 4.25%, 11/15/11 (c)		950		912,000
				1,155,000
Real Estate Investment Trusts (REITs) — 0.2%
Omega Healthcare Investors, Inc., 7.50%, 2/15/20 (b)		330		333,300
Semiconductors & Semiconductor Equipment — 1.1%
Advanced Micro Devices, Inc., 8.13%, 12/15/17 (b)		345		349,313
STATS ChipPAC Ltd.:
7.50%, 7/19/10		95		95,831
6.75%, 11/15/11		205		204,231
Spansion, Inc., 3.79%, 6/01/13 (a)(b)(g)		915		905,850
				1,555,225

Corporate Bonds	Par (000)		Value
Software — 0.1%
JDA Software Group, Inc., 8.00%, 12/15/14 (b)	USD	94	$	96,820
Wireless Telecommunication Services — 2.1%
Cricket Communications, Inc., 7.75%, 5/15/16		1,250		1,270,312
Digicel Group Ltd., 9.13%, 1/15/15 (b)(f)		1,249		1,217,775
iPCS, Inc., 2.37%, 5/01/13 (c)		500		460,000
				2,948,087
Total Corporate Bonds — 31.0%				42,928,221
Floating Rate Loan Interests (c)
Aerospace & Defense — 1.0%
Hawker Beechcraft Acquisition Co. LLC:
Letter of Credit Linked Deposit, 0.15%, 3/26/14		31		22,554
Term Loan, 2.25%, 3/26/14		503		370,511
TASC, Inc.:
Tranche A Term Loan, 5.50%, 12/18/14		340		341,417
Tranche B Term Loan, 5.75%, 12/18/15		660		664,400
				1,398,882
Auto Components — 3.5%
Affinion Group Holdings, Inc., Tranche B Term Loan, 2.73%, 10/17/12		350		339,675
Allison Transmission, Inc., Term Loan, 2.98% – 3.00%, 8/07/14		2,604		2,385,243
Dana Holding Corp., Term Advance, 4.48% – 6.50%, 1/30/15		683		665,724
Exide Technologies, Term Loan, 3.91%, 5/15/12	EUR	175		214,461
GPX International Tire Corp.:
Payment In Kind Amendment Fee, 14.00%, 4/11/12	USD	18		9,300
Tranche B Term Loan, 12.25%, 3/30/12		1,141		570,273
Lear Corp., Loan (Closing Date Loan & Delayed Draw Loan), 7.50%, 11/09/14		703		704,584
				4,889,260
Automobiles — 1.1%
Ford Motor Co.:
Tranche B-1 Term Loan, 3.24% – 3.26%, 12/15/13		473		437,410
Tranche B-2 Term Loan, 3.26%, 12/15/13		1,097		1,014,313
				1,451,723
Beverages — 0.2%
Culligan International Co., Loan (Second Lien), 5.18%, 4/24/13	EUR	500		281,409
Building Products — 2.7%
Building Materials Corp. of America:
Second Lien Term Loan, 6.00%, 9/15/14	USD	850		836,400
Term Loan Advance, 3.00%, 2/22/14		1,394		1,357,410
Goodman Global, Inc., Term Loan, 6.25%, 2/13/14		1,270		1,274,704
PGT Industries, Inc., Tranche A-2 Term Loan, 7.25%, 2/14/12		290		252,428
				3,720,942
Chemicals — 6.1%
Ashland Inc., Term B Borrowing, 7.65%, 5/13/14		370		374,036
Chemtura Corp., Term Facility Debtor in Possession, 6.00%, 2/11/11		800		803,500
Edwards (Cayman Islands II) Ltd., Term Loan (First Lien), 2.25%, 5/31/14		343		273,399
Gentek Holding, LLC, Tranche B Term Loan, 7.00%, 10/29/14		500		502,500

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	35

Schedule of Investments (continued)	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (c)	Par (000)		Value
Chemicals (concluded)
Huish Detergents Inc., Tranche B Term Loan, 2.01%, 4/26/14	USD	332	$	318,982
Matrix Acquisition Corp. (MacDermid, Inc.), Tranche C EURO Loan, 2.63%, 12/15/13	EUR	298		330,462
Nalco Co., Term Loan, 6.50%, 5/13/16	USD	1,269		1,277,505
PQ Corp., Original Term Loan (First Lien), 3.48% – 3.50%, 7/30/14		1,320		1,207,800
Rockwood Specialties Group, Inc., Term Loan H, 6.00%, 5/15/14		810		812,430
Solutia Inc., Loan, 7.25%, 2/28/14		1,605		1,625,620
Tronox Worldwide LLC:
Tranche B-1 Term Loan, 9.00%, 6/24/10		709		727,998
Tranche B-2 Term Loan, 9.00%, 6/24/10		191		195,582
				8,449,814
Commercial Services & Supplies — 3.4%
Advanced Disposal Services, Inc., Term B Loan, 6.00%, 1/14/15		500		500,000
ARAMARK Corp., Facility Letter of Credit, 0.09% – 2.03%, 1/26/14		50		47,784
ARAMARK Corp., US Term Loan, 2.13%, 1/26/14		762		726,590
Casella Waste Systems, Inc., Term B Loan, 7.00%, 4/09/14		497		500,609
John Maneely Co., Term Loan, 3.50%, 12/09/13		451		422,538
Johnson Diversey, Inc., Tranche B Dollar, 5.50%, 11/24/15		500		503,750
Synagro Technologies, Inc., Term Loan (First Lien), 2.23%, 4/02/14		975		859,625
West Corp.:
Incremental Term B-3 Loan, 7.25%, 10/24/13		746		753,385
Term B-2 Loan, 2.60% – 2.63%, 10/24/13		452		435,687
				4,749,968
Construction & Engineering — 1.2%
Acqulex Corporation, Term B Loan, 9.35%, 12/16/13		747		751,197
Safway Services, LLC, First Out, Term Loan, 9.00%, 12/14/17		900		900,000
				1,651,197
Consumer Finance — 0.9%
Chrysler Financial Services Americas LLC, Term Loan (First Lien), 4.24%, 8/03/12		1,253		1,237,337
Containers & Packaging — 1.1%
Anchor Glass, Term Loan B, 6.00%, 2/18/16		700		693,000
Berry Plastics Holding Corp., Term C Loan, 2.25%, 4/03/15		549		490,835
Graham Packaging Co., LP:
Term Loan B, 2.50%, 10/07/11		46		45,266
Term Loan C, 6.75%, 4/05/14		289		290,541
				1,519,642
Diversified Consumer Services — 2.4%
Coinmach Service Corp., Term Loan, 3.26%, 11/14/14		1,474		1,274,737
Laureate Education, Series A New Term Loan, 7.00%, 8/15/14		2,070		2,051,029
				3,325,766
Diversified Financial Services — 1.2%
CIT Group, Inc., Tranche 2A Term Loan, 9.50%, 1/20/12		983		1,006,448
Reynolds Group Holdings Inc., US Term Loan, 6.25%, 11/05/15		700		704,375
				1,710,823

Floating Rate Loan Interests (c)	Par (000)		Value
Diversified Telecommunication Services — 1.2%
Integra Telecom Holdings, Inc., Term Loan (First Lien), 10.50%, 8/31/13	USD	598	$	597,394
Level 3 Communications Incremental Term Loan, 7.59%, 3/13/14		150		135,156
US Telepacific Corp., Second Lien Term Loan, 7.75%, 7/25/15		250		250,469
Wind Finance SL SA, Euro Facility (Second Lien), 7.67%, 12/17/14	EUR	525		712,000
				1,695,019
Electrical Equipment — 0.6%
Baldor Electric Co., Term Loan, 5.25%, 1/31/14	USD	681		681,791
Generac Acquisition Corp., Term Loan (First Lien), 2.75%, 11/10/13		179		164,258
				846,049
Energy Equipment & Services — 0.7%
Dresser, Inc., Term Loan (Second Lien), 6.00%, 5/04/15		500		467,500
MEG Energy Corp., Tranche D Term Loan, 6.00%, 4/03/16		497		487,932
				955,432
Food & Staples Retailing — 4.0%
AB Acquisitions UK Topco 2 Ltd. (fka Alliance Boots), Facility B1, 3.54%, 7/09/15	GBP	900		1,229,377
Bolthouse Farms, Inc., Term Loan B, 3.75%, 2/04/16	USD	600		600,000
DS Waters of America, Inc., Term Loan, 2.50%, 10/29/12		458		428,574
Pierre Foods, Term Loan B, 8.50%, 9/30/14		342		341,145
Pilot Travel Centers, Term Loan B, 3.50%, 11/18/15		1,500		1,506,954
Rite Aid Corp., Tranche 4 Term Loan, 9.50%, 6/10/15		1,000		1,036,000
SUPERVALU Inc., Term B Advance, 1.48%, 6/02/12		363		351,802
				5,493,852
Food Products — 4.6%
CII Investment, LLC (fka Cloverhill):
Term Loan A, 8.50%, 10/14/14		445		444,771
Term Loan B, 8.50%, 10/14/14		541		540,943
Dole Food Co., Inc.:
Credit-Linked Deposit, 0.17%, 8/30/10		614		614,055
Term Loan B, 3.50%, 2/10/17		500		500,250
Term Loan C, 5.50%, 2/10/17		1,200		1,200,600
Tranche B Term Loan, 8.00%, 4/12/13		202		201,777
Pilgrim’s Pride Corp., Term Loan A, 5.29%, 12/01/12		500		492,500
Pinnacle Foods Finance LLC, Tranche C Term Loan, 7.50%, 4/02/14		1,300		1,305,339
Solvest, Ltd. (Dole), Tranche C Term Loan, 8.00%, 4/12/13		1,084		1,083,541
				6,383,776
Health Care Equipment & Supplies — 1.0%
Biomet, Inc., Dollar Term Loan, 3.23% – 3.25%, 3/25/15		994		961,243
DJO Finance LLC (ReAble Therapeutics Financial LLC), Term Loan, 3.23%, 5/20/14		442		427,418
Hologic, Inc., Tranche B Term Loan, 3.50%, 3/29/13		35		34,341
				1,423,002

See Notes to Financial Statements.
36	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (c)	Par (000)		Value
Health Care Providers & Services — 4.3%
CHS/Community Health Systems, Inc.:
Delayed Draw Term Loan, 2.50%, 7/25/14	USD	95	$	88,705
Funded Term Loan, 2.48% – 2.50%, 7/25/14		1,798		1,679,975
DaVita Inc., Tranche B-1 Term Loan, 1.73% – 1.76%, 10/05/12		175		170,909
Fresenius SE:
Tranche B1 Term Loan, 6.75%, 9/10/14		692		695,183
Tranche B2 Term Loan, 6.75%, 9/10/14		419		420,975
HCA Inc.:
Tranche A-1 Term Loan, 1.75%, 11/16/12		926		874,874
Tranche B-1 Term Loan, 2.50%, 11/18/13		924		876,700
Vanguard Health Holding Company II, LLC (Vanguard Health Systems, Inc.), Initial Term Loan, 5.00%, 1/29/16		1,100		1,101,375
				5,908,696
Health Care Technology — 1.0%
IMS Healthcare, Term Loan B, 5.25%, 2/16/16		1,300		1,305,200
Hotels, Restaurants & Leisure — 5.0%
Blackstone UTP Capital LLC, Loan, 7.75%, 11/06/14		750		754,219
Cedar Fair LP, Term Loan B, 4.00%, 2/04/16		800		798,751
Harrah’s Operating Co., Inc.:
Term B-1 Loan, 3.25%, 1/28/15		128		103,319
Term B-2 Loan, 3.25%, 1/28/15		1,372		1,107,226
Term B-3 Loan, 3.25%, 1/28/15		112		90,394
Term Loan, 20%, 10/01/10		1		12
Lake at Las Vegas Joint Venture / LLV-1, LLC (a)(g):
Revolving Loan Credit-Linked Deposit Account, 12.35%, 6/20/12		60		602
Mezzanine, 14.35% – 15.00%, 6/20/12		656		6,557
QCE, LLC (Quiznos), Term Loan (First Lien), 2.56%, 5/05/13		203		173,360
SW Acquisitions Co., Inc., Term Loan, 5.75%, 6/01/16		1,250		1,255,469
Six Flags Theme Parks, Inc., Term Loan, 4.50%, 6/13/15		2,000		1,981,500
VML US Finance LLC (aka Venetian Macau):
Term B Delayed Draw Project Loan, 4.76%, 5/25/12		188		178,597
Term B Funded Project Loan, 4.76%, 5/27/13		438		416,486
				6,866,492
Household Durables — 1.0%
American Residential Services LLC, Term Loan (Second Lien), 10.00%, 4/17/15		1,030		991,654
Jarden Corp., Term Loan B3, 2.75%, 1/24/12		441		436,888
				1,428,542
Independent Power Producers & Energy Traders — 1.8%
Dynegy Holdings Inc.:
Term Letter of Credit Facility, 3.98%, 4/02/13		694		677,261
Tranche B Term Loan, 3.98%, 4/02/13		56		54,519
Texas Competitive Electric Holdings Co., LLC (TXU):
Initial Tranche B-1 Term Loan, 3.73% – 3.75%, 10/10/14		1,350		1,084,946
Initial Tranche B-2 Term Loan, 3.73% – 3.75%, 10/10/14		232		186,502
Initial Tranche B-3 Term Loan, 3.73% – 3.75%, 10/10/14		618		494,101
				2,497,329

Floating Rate Loan Interests (c)	Par (000)		Value
Industrial Conglomerates — 0.7%
Sequa Corp., Term Loan, 3.51% – 3.94%, 12/03/14	USD	1,072	$	980,392
Insurance — 0.6%
Alliant Holdings I, Inc., Term Loan, 3.25%, 8/21/14		828		781,393
Internet & Catalog Retail — 0.3%
FTD Group, Inc., Tranche B Term Loan, 6.75%, 8/26/14		422		422,391
IT Services — 3.8%
Audio Visual Services Group, Inc., Tranche B Term Loan (First Lien), 2.51%, 2/28/14		497		348,219
Ceridian Corp., US Term Loan, 3.23% – 3.25%, 11/09/14		1,055		922,542
First Data Corp.:
Initial Tranche B-1 Term Loan, 3.00%, 9/24/14		250		218,597
Initial Tranche B-2 Term Loan, 3.00%, 9/24/14		2,172		1,894,140
Initial Tranche B-3 Term Loan, 3.00%, 9/24/14		121		104,942
SunGard Data Systems Inc. (Solar Capital Corp.):
Incremental Term Loan, 6.75%, 2/28/14		1,116		1,119,506
Tranche B US Term Loan, 3.86% – 3.87%, 2/28/16		599		583,599
				5,191,545
Leisure Equipment & Products — 0.5%
24 Hour Fitness Worldwide, Inc., Tranche B Term Loan, 2.76%, 6/08/12		225		212,625
True Temper Sports, Debtor in Possession Term Loan, 13.00%, 10/14/13		493		468,505
				681,130
Machinery — 2.7%
Accuride Corp., Term Loan, 10.00%, 1/31/12		450		449,063
Blount International, Term Loan, 5.50% – 5.75%, 2/09/12		1,000		997,511
Bucyrus International, Term Loan C, 4.50%, 1/26/16		1,250		1,256,625
Oshkosh Truck Corp., Term B Loan, 6.25% – 6.26%, 12/06/13		1,013		1,011,778
				3,714,977
Media — 20.1%
Affinion Group Holdings, Inc., Loan, 8.39%, 3/01/12		327		309,227
Catalina Marketing Corp., Initial Term Loan, 2.98%, 10/01/14		280		269,892
Cengage Learning Acquisitions, Inc. (Thomson Learning), Tranche 1 Incremental Term Loan, 7.50%, 7/03/14		1,965		1,945,375
Cequel Communications, LLC:
Term Loan, 2.25%, 11/05/13		580		549,106
Tranche A Term Loan (Second Lien), 4.75%, 5/05/14		1,000		974,100
Tranche B Term Loan (Second Lien), 6.25%, 5/05/14		250		250,400
Charter Communications Operating, LLC, New Term Loan, 2.23% – 2.26%, 3/06/14		2,375		2,215,334
HMH Publishing Co. Ltd.:
Mezzanine, 1.26%, 11/14/14		270		33,354
Tranche A Term Loan, 5.48%, 6/12/14		828		696,852
Hanley-Wood, LLC (FSC Acquisition), Term Loan, 2.50%, 3/10/14		978		436,617

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	37

Schedule of Investments (continued)	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (c)	Par (000)		Value
Media (concluded)
Harland Clarke Holdings Corp. (fka Clarke American Corp.), Tranche B Term Loan, 2.73% – 2.75%, 6/30/14	USD	726	$	635,128
Insight Midwest Holdings, LLC, B Term Loan, 2.25%, 4/07/14		1,175		1,128,183
Intelsat Corp. (fka PanAmSat Corp.):
Tranche B-2-A Term Loan, 2.73%, 1/03/14		166		158,061
Tranche B-2-B Term Loan, 2.73%, 1/03/14		166		158,013
Tranche B-2-C Term Loan, 2.73%, 1/03/14		166		158,013
Intelsat Subsidiary Holding Co. Ltd., Tranche B Term Loan, 2.73%, 7/03/13		732		697,929
Lamar Media Corp.:
Series B, Incremental Loan, 5.50% – 5.75%, 9/28/12		449		445,231
Series E, Incremental Loan, 5.50% – 5.75%, 3/31/13		235		234,943
Term Loan, 5.50% – 5.75%, 9/28/12		1,566		1,553,814
Lavena Holding 3 GmbH (Prosiebensat.1 Media AG), Facility B1, 3.34%, 6/30/15	EUR	337		314,143
MCC Iowa LLC (Mediacom Broadband Group), Tranche E Term Loan, 6.50%, 1/03/16	USD	521		525,327
MCNA Cable Holdings LLC (OneLink Communications), Loan (Payment In Kind Facility), 7.23%, 3/01/13 (f)		1,289		1,005,369
Mediacom Illinois, LLC (fka Mediacom Communications, LLC), Tranche D Term Loan, 5.50%, 3/31/17		499		498,122
Metro-Goldwyn-Mayer Inc., Tranche B Term Loan, 20.50%, 4/09/12		448		269,223
Multicultural Radio Broadcasting, Inc., Term Loan, 2.98%, 12/18/12		304		241,300
Newsday, LLC, Fixed Rate Term Loan, 10.50%, 8/01/13		1,275		1,362,656
Nielsen Finance LLC, Class B, Dollar Term Loan, 3.98%, 5/01/16		1,587		1,536,407
Penton Media, Inc., Term Loan (First Lien), 2.48% – 2.50%, 2/01/13		486		354,963
Sinclair Television Group, Inc., Tranche B Term Loan, 6.50%, 10/29/15		750		753,750
Springer Science+Business Media SA, Facility A1, 6.75%, 7/01/16	EUR	1,000		1,345,769
Sunshine Acquisition Ltd. (aka HIT Entertainment), Term Facility, 2.50%, 3/20/12	USD	1,000		879,167
TWCC Holding Corp., Term Loan, 7.25%, 9/14/15		1,486		1,489,916
UPC Financing Partnership, Facility U, 4.46%, 12/31/17	EUR	1,050		1,332,040
Virgin Media Investment Holdings Ltd.:
B7 Facility, 4.40%, 9/03/12	GBP	16		23,760
C Facility, 3.58%, 7/17/13		300		427,328
C Facility, 4.40%, 9/03/12		353		524,298
Term Loan B, 3.57%, 9/03/12		425		631,195
Worldcolor Press Inc. and Worldcolor (USA) Corp. (fka Quebecor World, Inc.), Advance Term Loan, 9.00%, 7/23/12	USD	648		654,129
Yell Group Plc TPI, Term Loan A, 7.12%, 8/09/11		750		718,125
				27,736,559
Multi-Utilities — 0.4%
FirstLight Power Resources, Inc. (fka NE Energy, Inc.):
Synthetic Letter of Credit, 0.16%, 11/01/13		53		49,150
Term B Advance (First Lien), 2.75%, 11/01/13		572		533,868
				583,018

Floating Rate Loan Interests (c)	Par (000)		Value
Multiline Retail — 0.8%
Dollar General Corp., Tranche B-2 Term Loan, 2.98%, 7/07/14	USD	960	$	923,912
The Neiman Marcus Group Inc., Term Loan, 2.25%, 4/06/13		215		192,975
				1,116,887
Oil, Gas & Consumable Fuels — 1.3%
Big West Oil, LLC:
Delayed Advance Loan, 4.50%, 5/15/14		441		432,080
Initial Advance Loan, 4.50%, 5/15/14		349		342,120
Term Loan B, 9.75%, 1/26/15		500		502,500
Coffeyville Resources, LLC, Tranche D Term Loan, 8.50%, 12/30/13		490		492,917
				1,769,617
Paper & Forest Products — 1.5%
Georgia-Pacific LLC, Term Loan B, 2.25% – 2.26%, 12/23/12		1,451		1,417,543
Verso Paper Finance Holdings LLC, PIK Loan, 7.25%, 2/01/13 (f)		1,283		705,884
				2,123,427
Personal Products — 0.4%
American Safety Razor Co., LLC:
Loan (Second Lien), 6.51%, 1/30/14		350		204,750
Term Loan (First Lien), 2.75% – 2.76%, 7/31/13		249		226,465
Revlon Consumer Products Corp., Term Loan, 4.25% – 4.26%, 1/15/12		150		147,609
				578,824
Pharmaceuticals — 1.9%
Catalent Pharma Solutions, Inc. (fka Cardinal Health 409, Inc.), Euro Term Loan, 2.67%, 4/15/14	EUR	488		587,469
Warner Chilcott Co., LLC, Term A Loan, 5.50%, 10/30/14	USD	678		677,797
Warner Chilcott Corp.:
Additional Term Loan, 5.75%, 4/30/15		310		310,084
Term B-1 Loan, 5.75%, 4/30/15		339		338,751
Term B-2 Loan, 5.75%, 4/30/15		746		745,251
				2,659,352
Professional Services — 0.9%
Booz Allen Hamilton Inc., Term Loan C, 6.00%, 7/31/15		1,250		1,253,906
Real Estate Management & Development — 1.3%
Mattamy Funding Partnership, Term Loan B, 2.56%, 4/11/13		481		440,344
Realogy Corp.:
Delayed Draw Term B Loan, 3.25%, 10/10/13		598		527,741
Initial Term B Loan, 3.25%, 10/10/13		786		692,989
Synthetic Letter of Credit, 0.08%, 10/10/13		212		186,574
				1,847,648
Specialty Retail — 0.9%
Adesa, Inc. (KAR Holdings, Inc.), Initial Term Loan, 2.98%, 10/21/13		407		392,603
Michaels Stores, Inc.:
B-1 Term Loan, 2.50% – 2.56%, 10/31/13		310		278,832
B-2 Term Loan, 4.75% – 4.81%, 7/31/16		571		544,190
				1,215,625

See Notes to Financial Statements.
38	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (c)	Par (000)			Value
Textiles, Apparel & Luxury Goods — 0.3%
Hanesbrands Inc., New Term Loan, 5.25%, 12/10/15	USD	400		$	403,000
Wireless Telecommunication Services — 0.8%
Digicel International Finance Ltd., Tranche A, 2.81%, 3/30/12		425			409,063
MetroPCS Wireless, Inc., Tranche B Term Loan, 2.50%, 11/03/13		748			720,716
					1,129,779
Total Floating Rate Loan Interests — 89.2%					123,379,622
Other Interests (h)	Beneficial Interest (000)
Auto Components — 1.0%
Delphi Debtor in Possession Hold Co. LLP, Class B Membership Interests		—	(i)		1,334,647
Diversified Financial Services — 0.2%
J. G. Wentworth LLC Preferred Equity Interests		—	(i)		287,823
Total Other Interests — 1.2%					1,622,470
Total Long-Term Investments (Cost — $176,501,853) — 121.8%					168,470,259
Short-Term Securities	Shares
BlackRock Liquidity Funds, TempFund, Institutional Class, 0.09% (j)(k)		1,797,812			1,797,812
Total Short-Term Securities (Cost — $1,797,812) — 1.3%					1,797,812
Options Purchased	Contracts
Over-the-Counter Call Options — 0.0%
Marsico Parent Superholdco LLC, Strike Price USD 942.86, Expires 12/21/19, Broker Goldman Sachs & Co.		11			2,090
Total Options Purchased (Cost — $10,756) — 0.0%					2,090
Total Investments (Cost — $178,310,421*) — 123.1%					170,270,161
Liabilities in Excess of Other Assets — (23.1)%					(31,899,477	)
Net Assets — 100.0%				$	138,370,684

* The cost and unrealized appreciation (depreciation) of investments as of February 28, 2010, as computed for federal income tax purposes, were as follows:

Aggregate cost	$	178,405,382
Gross unrealized appreciation	$	3,845,191
Gross unrealized depreciation		(11,980,412	)
Net unrealized depreciation	$	(8,135,221	)

(a)	Non-income producing security.
(b)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)	Variable rate security. Rate shown is as of report date.
(d)	Convertible security.
(e)	Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.
(f)	Represents a payment-in-kind security which may pay interest/dividends in additional face/shares.
(g)	Issuer filed for bankruptcy and/or is in default of interest payments.
(h)	Other interests represent beneficial interest in liquidation trusts and other reorganization entities and are non-income producing.
(i)	Amount is less than $1,000.
(j)	Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows:

Affiliate	Net Activity			Income
BlackRock Liquidity Funds, TempFund, Institutional Class	$	1,797,812		$	6,878
BlackRock Liquidity Series, LLC Cash Sweeps Series	$	(4,108,178	)	$	1,347

(k)	Represents the current yield as of report date.
•	For Fund compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease. These industry classifications are unaudited.
•	Foreign currency exchange contracts as of February 28, 2010 were as follows:

Currency Purchased		Currency Sold		Counterparty	Settlement Date	Unrealized Appreciation (Depreciation)
USD	7,780,395	EUR	5,440,000	Citibank NA	3/24/10	$	373,338
GBP	953,000	USD	1,495,460	Citibank NA	4/21/10		(42,902	)
USD	1,517,532	GBP	950,000	Citibank NA	4/21/10		69,547
USD	1,381,821	GBP	853,500	Morgan Stanley Capital Services, Inc.	4/21/10		80,920
Total						$	480,903

• Credit default swaps on single-name issues — sold protection outstanding as of February 28, 2010, were as follows:

Issuer	Receive Fixed Rate	Counterparty	Expiration	Credit Rating1	Notional Amount (000)2	Unrealized Appreciation
Ford Motor Co.	3.80%	UBS AG	March 2010	CCC	USD 1,000	$856

		1	Using S&P’s rating of the issuer.
		2	The maximum potential amount the Fund may pay should a negative credit take place as defined under the terms of the agreement.
•	Fair Value Measurements — Various inputs are used in determining the fair value of investments, which are as follows:
	•	Level 1 — price quotations in active markets/exchanges for identical assets and liabilities
	•	Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, repayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)
	•	Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments)
	The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	39

Schedule of Investments (concluded) BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)

The following tables summarize the inputs used as of February 28, 2010 in determining the fair valuation of the Fund’s investments:

	Investments in Securities
Valuation Inputs	Level 1		Level 2		Level 3		Total
Assets:
Long-Term Investments:
Common Stocks	$	509,511		—	$	30,435	$	539,946
Corporate Bonds		—	$	41,911,551		1,016,670		42,928,221
Floating Rate Loan Interests		—		104,667,984		18,711,638		123,379,622
Other Interests		—		—		1,622,470		1,622,470
Short-Term Securities		1,797,812		—		—		1,797,812
Total	$	2,307,323	$	146,579,535	$	21,381,213	$	170,268,071

	Other Financial Instruments1
Valuation Inputs	Level 1		Level 2			Level 3			Total
Assets		—	$	526,751		$	4,076		$	530,827
Liabilities		—		(42,902	)		(38,101	)		(81,003	)
Total		—	$	483,849		$	(34,025	)	$	449,824

¹ Other financial instruments are swaps, foreign currency exchange contracts, options and unfunded loan commitments. Swaps, foreign currency exchange contracts and unfunded loan commitments are shown at the unrealized appreciation/depreciation on the instrument and options are shown at market value.

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Investments in Securities
	Common Stocks		Corporate Bonds			Floating Rate Loan Interests			Other Interests		Total
Balance, as of February 28, 2009	$	4,165	$	1,437,808		$	35,230,878			—	$	36,672,851
Accrued discounts/premiums		—		—			—			—		—
Realized gain (loss)		—		(238,712	)		(9,314,760	)		—		(9,553,472	)
Change in unrealized appreciation/depreciation2		—		164,767			20,334,144			—		20,498,911
Net purchases (sales)		—		(812,210	)		(21,084,905	)		—		(21,897,115	)
Net transfers in (out) of Level 3		26,270		465,017			(6,453,719	)	$	1,622,470		(4,339,962	)
Balance, as of February 28, 2010	$	30,435	$	1,016,670		$	18,711,638		$	1,622,470	$	21,381,213

² Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in the unrealized appreciation/depreciation on the securities still held on February 28, 2010 was $6,849,181.

The following table is a reconciliation of Level 3 other financial instruments for which significant unobservable inputs were used to determine fair value:

	Other Financial Instruments3
	Assets		Liabilities			Total
Balance, as of February 28, 2009		—		—			—
Accrued discounts/premiums		—		—			—
Realized gain (loss)		—	$	(18,182	)	$	(18,182	)
Change in unrealized appreciation/depreciation4	$	4,076		(19,919	)		(15,843	)
Net purchases (sales)		—		—			—
Net transfers in (out) of Level 3		—		—			—
Balance, as of February 28, 2010	$	4,076	$	(38,101	)	$	(34,025	)

3	Other financial instruments are unfunded loan commitments.
4	Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in unrealized appreciation/depreciation on the securities still held at February 28, 2010 was $0.

See Notes to Financial Statements.
40	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments February 28, 2010	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Common Stocks	Shares		Value
Auto Components — 0.2%
Lear Corp. (a)		5,425	$	375,790
Building Products — 0.8%
Masonite Worldwide Holdings (a)		40,055		1,682,310
Capital Markets — 0.2%
E*Trade Financial Corp. (a)		271,000		436,310
Chemicals — 0.0%
GEO Specialty Chemicals, Inc. (a)		142,466		54,692
Wellman Holdings, Inc. (a)		5,131		1,283
				55,975
Construction Materials — 0.0%
Nortek, Inc. (a)		2,570		95,090
Containers & Packaging — 0.1%
Smurfit Kappa Plc (a)		18,171		149,776
Hotels, Restaurants & Leisure — 0.0%
Lodgian, Inc. (a)		41,866		103,828
Paper & Forest Products — 0.7%
Ainsworth Lumber Co. Ltd. (a)		375,634		788,967
Ainsworth Lumber Co. Ltd. (a)(b)		421,556		885,420
				1,674,387
Software — 0.0%
Euramax International (a)		935		28,047
Total Common Stocks — 2.0%				4,601,513

Corporate Bonds		Par (000)
Aerospace & Defense — 0.5%
TransDigm, Inc., 7.75%, 7/15/14 (b)	USD	1,100	1,100,000
Airlines — 0.5%
Delta Air Lines, Inc., Series B, 9.75%, 12/17/16		500	515,000
United Air Lines, Inc., 12.75%, 7/15/12		600	636,000
			1,151,000
Auto Components — 1.9%
The Goodyear Tire & Rubber Co., 8.63%, 12/01/11		4,000	4,150,000
Venture Holdings Co. LLC (a)(c):
12.00%, 6/01/09		700	—
Series B, 9.50%, 7/01/05		3,325	333
			4,150,333
Biotechnology — 0.2%
QHP Pharma, 10.25%, 3/15/15 (b)		315	321,577
Building Products — 2.8%
Building Materials Corp. of America, 7.00%, 2/15/20 (b)		675	675,000
CPG International I, Inc.:
7.18%, 7/01/12 (e)		3,500	3,325,000
10.50%, 7/01/13		1,500	1,470,000
Ply Gem Industries, Inc., 11.75%, 6/15/13		725	735,875
			6,205,875
Chemicals — 3.0%
American Pacific Corp., 9.00%, 2/01/15		610	602,375
GEO Specialty Chemicals, Inc.:
7.50%, 3/31/15 (b)(f)(g)		1,869	1,214,604
10.00%, 3/31/15		1,839	1,195,168
Huntsman International LLC, 5.50%, 6/30/16 (b)		495	435,600

Corporate Bonds	Par (000)		Value
Chemicals (concluded)
Wellman Holdings, Inc. (g):
Second Lien Subordinate Note, 10.00%, 1/29/19 (b)	USD	2,383	$	2,383,000
Third Lien Subordinate Note, 5.00%, 1/29/19 (f)		1,639		819,684
				6,650,431
Commercial Services & Supplies — 1.6%
ACCO Brands Corp., 10.63%, 3/15/15 (b)		365		396,755
Clean Harbors, Inc., 7.63%, 8/15/16		700		707,000
The Geo Group, Inc., 7.75%, 10/15/17 (b)		450		455,625
RSC Equipment Rental, Inc., 10.00%, 7/15/17 (b)		550		588,500
Sally Holdings LLC, 9.25%, 11/15/14		420		438,900
Scientific Games International, Inc., 9.25%, 6/15/19		960		1,015,200
				3,601,980
Communications Equipment — 0.0%
Brocade Communications Systems, Inc., 6.88%, 1/15/20 (b)		90		91,800
Construction Materials — 1.2%
Nortek, Inc., 11.00%, 12/01/13		2,581		2,710,493
Consumer Finance — 1.2%
Credit Acceptance Corp., 9.13%, 2/01/17 (b)		300		298,500
Ford Motor Credit Co. LLC, 3.00%, 1/13/12 (e)		1,340		1,256,250
Inmarsat Finance Plc, 7.38%, 12/01/17 (b)		1,150		1,178,750
				2,733,500
Containers & Packaging — 2.8%
Berry Plastics Escrow LLC, 8.25%, 11/15/15 (b)		1,100		1,097,250
Clondalkin Acquisition BV, 2.25%, 12/15/13 (b)(e)		2,000		1,785,000
Crown Americas LLC, 7.63%, 5/15/17 (b)		400		416,000
Graphic Packaging International, Inc., 9.50%, 6/15/17		555		582,750
Packaging Dynamics Finance Corp., 10.00%, 5/01/16 (b)		1,325		1,055,031
Smurfit Kappa Funding Plc, 7.75%, 4/01/15		1,050		1,018,500
Solo Cup Co., 10.50%, 11/01/13		250		261,875
				6,216,406
Diversified Financial Services — 3.8%
GMAC, Inc., 8.30%, 2/12/15 (b)		4,700		4,741,125
Highland Legacy Ltd., 6.50%, 6/01/11 (b)(e)		4,000		2,400,000
Reynolds Group DL Escrow, Inc., 7.75%, 10/15/16 (b)		955		966,937
				8,108,062
Diversified Telecommunication Services — 2.8%
Cincinnati Bell, Inc., 8.25%, 10/15/17		900		900,000
Nordic Telephone Co. Holdings ApS, 8.88%, 5/01/16 (b)		180		192,600
PAETEC Holding Corp., 8.88%, 6/30/17 (b)		175		175,935
Qwest Corp., 8.38%, 5/01/16		3,000		3,285,000
Windstream Corp., 7.88%, 11/01/17		1,750		1,710,625
				6,264,160
Electric Utilities — 0.4%
NSG Holdings LLC, 7.75%, 12/15/25 (b)		1,000		865,000
Energy Equipment & Services — 0.5%
Expro Finance Luxembourg SCA, 8.50%, 12/15/16 (b)		1,000		995,000

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	41

Schedule of Investments (continued)	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Corporate Bonds	Par (000)		Value
Food & Staples Retailing — 0.5%
Duane Reade, Inc., 11.75%, 8/01/15	USD	155	$	195,300
Rite Aid Corp., 9.75%, 6/12/16		825		880,688
				1,075,988
Food Products — 0.9%
B&G Foods, Inc., 7.63%, 1/15/18		500		505,000
Bumble Bee Foods LLC, 7.75%, 12/15/15 (b)		380		380,950
Smithfield Foods, Inc., 10.00%, 7/15/14 (b)		1,050		1,136,625
				2,022,575
Health Care Equipment & Supplies — 0.7%
DJO Finance LLC, 10.88%, 11/15/14		710		759,700
Hologic, Inc., 2.00%, 12/15/37 (g)(h)		830		709,650
				1,469,350
Health Care Providers & Services — 3.2%
Community Health Systems, Inc., Series WI, 8.88%, 7/15/15		1,880		1,945,800
DaVita, Inc., 7.25%, 3/15/15		525		526,969
Tenet Healthcare Corp. (b):
10.00%, 5/01/18		850		935,000
8.88%, 7/01/19		2,775		2,927,625
Vanguard Health Holding Co. II LLC, 8.00%, 2/01/18 (b)		790		776,175
				7,111,569
Health Care Technology — 0.8%
IMS Health, Inc., 12.50%, 3/01/18 (b)		1,580		1,817,000
Hotels, Restaurants & Leisure — 1.8%
Icahn Enterprises LP (b):
7.75%, 1/15/16		750		705,000
8.00%, 1/15/18		1,500		1,410,000
Little Traverse Bay Bands of Odawa Indians, 10.25%, 2/15/14 (a)(b)(d)		1,210		305,525
MGM Mirage:
13.00%, 11/15/13		100		114,000
10.38%, 5/15/14 (b)		185		196,100
11.13%, 11/15/17 (b)		750		810,000
Shingle Springs Tribal Gaming Authority, 9.38%, 6/15/15 (b)		190		151,050
Snoqualmie Entertainment Authority, 4.14%, 2/01/14 (b)(e)		500		340,000
Tropicana Entertainment LLC, Series WI, 9.63%, 12/15/14 (a)(d)		220		137
				4,031,812
Household Durables — 1.1%
Beazer Homes USA, Inc., 12.00%, 10/15/17 (b)		1,000		1,115,000
K. Hovnanian Enterprises, Inc., 10.63%, 10/15/16		1,200		1,254,000
KB Home, 6.38%, 8/15/11		106		107,855
				2,476,855
Household Products — 0.1%
Libbey Glass, Inc., 10.00%, 2/15/15 (b)		115		119,025
IT Services — 0.2%
First Data Corp., 9.88%, 9/24/15		625		540,625
Independent Power Producers & Energy Traders — 3.3%
The AES Corp., 8.75%, 5/15/13 (b)		335		340,863
AES Eastern Energy LP, Series 99-B, 9.67%, 1/02/29		570		617,737
Calpine Construction Finance Co. LP, 8.00%, 6/01/16 (b)		1,000		1,012,500
Dynegy Holdings, Inc., 8.38%, 5/01/16		1,260		1,102,500

Corporate Bonds	Par (000)		Value
Independent Power Producers & Energy Traders (concluded)
Energy Future Holdings Corp., 11.25%, 11/01/17 (f)	USD	860	$	602,280
NRG Energy, Inc.:
7.25%, 2/01/14		3,000		3,022,500
8.50%, 6/15/19		500		499,375
				7,197,755
Industrial Conglomerates — 1.5%
Sequa Corp. (b):
11.75%, 12/01/15		1,430		1,401,400
13.50%, 12/01/15 (f)		2,002		2,007,094
				3,408,494
Internet & Catalog Retail — 0.1%
NetFlix, Inc., 8.50%, 11/15/17		250		261,875
Machinery — 2.0%
ESCO Corp., 4.13%, 12/15/13 (b)(e)		1,540		1,362,900
Navistar International Corp., 8.25%, 11/01/21		1,500		1,522,500
RBS Global, Inc., 8.88%, 9/01/16		835		755,675
Titan International, Inc., 8.00%, 1/15/12		770		766,150
				4,407,225
Marine — 0.2%
Navios Maritime Holdings, Inc., 8.88%, 11/01/17 (b)		450		457,875
Media — 7.0%
Affinion Group, Inc., 10.13%, 10/15/13		1,015		1,025,150
CSC Holdings, Inc., 8.50%, 4/15/14 (b)		390		409,988
Clear Channel Worldwide Holdings, Inc., 9.25%, 12/15/17 (b)		2,137		2,193,217
DISH DBS Corp.:
7.00%, 10/01/13		850		869,125
6.63%, 10/01/14		750		751,875
Intelsat Corp., 9.25%, 8/15/14		3,500		3,605,000
Nielsen Finance LLC, 11.63%, 2/01/14		2,000		2,227,500
UPC Germany GmbH, 8.13%, 12/01/17 (b)		1,500		1,500,000
Virgin Media Secured Finance Plc, 6.50%, 1/15/18 (b)		3,000		2,955,000
				15,536,855
Metals & Mining — 1.8%
Aleris International, Inc., 9.00%, 12/15/14 (a)(d)		840		2,100
Murray Energy Corp., 10.25%, 10/15/15 (b)		420		420,525
RathGibson, Inc., 11.25%, 2/15/14 (a)(d)		2,175		698,719
Ryerson, Inc., 7.62%, 11/01/14 (e)		1,800		1,606,500
Teck Resources Ltd., 10.75%, 5/15/19		1,075		1,322,250
				4,050,094
Multiline Retail — 0.6%
Dollar General Corp., 11.88%, 7/15/17 (f)		948		1,102,050
Saks, Inc., 9.88%, 10/01/11		125		129,688
				1,231,738
Oil, Gas & Consumable Fuels — 3.8%
Arch Coal, Inc., 8.75%, 8/01/16 (b)		750		776,250
Atlas Energy Operating Co. LLC:
12.13%, 8/01/17		825		928,125
10.75%, 2/01/18		200		216,500
Crosstex Energy LP, 8.88%, 2/15/18 (b)		330		334,950
Denbury Resources, Inc.:
9.75%, 3/01/16		520		560,300
8.25%, 2/15/20		355		367,425
El Paso Corp., 7.00%, 6/15/17		775		777,379

See Notes to Financial Statements.
42	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Corporate Bonds	Par (000)		Value
Oil, Gas & Consumable Fuels (concluded)
Forest Oil Corp.:
8.50%, 2/15/14	USD	280	$	289,100
7.25%, 6/15/19		85		83,300
Massey Energy Co., 6.88%, 12/15/13		800		794,000
OPTI Canada, Inc., 9.00%, 12/15/12 (b)		550		559,625
Sabine Pass LNG LP, 7.50%, 11/30/16		2,985		2,619,338
				8,306,292
Paper & Forest Products — 3.1%
Ainsworth Lumber Co. Ltd., 11.00%, 7/29/15 (b)(f)		1,323		985,707
Clearwater Paper Corp., 10.63%, 6/15/16 (b)		365		405,150
Georgia-Pacific LLC, 8.25%, 5/01/16 (b)		1,630		1,719,650
NewPage Corp., 6.50%, 5/01/12 (e)		5,175		2,742,750
Verso Paper Holdings LLC:
11.50%, 7/01/14 (b)		315		330,750
4.00%, 8/01/14 (e)		745		601,588
				6,785,595
Pharmaceuticals — 0.8%
Angiotech Pharmaceuticals, Inc., 4.00%, 12/01/13 (e)		955		773,550
Elan Corp. Plc, 8.75%, 10/15/16 (b)		520		504,400
Valeant Pharmaceuticals International, 8.38%, 6/15/16 (b)		450		465,750
				1,743,700
Real Estate Investment Trusts (REITs) — 0.2%
Omega Healthcare Investors, Inc., 7.50%, 2/15/20 (b)		530		535,300
Semiconductors & Semiconductor Equipment — 1.1%
Advanced Micro Devices, Inc., 8.13%, 12/15/17 (b)		555		561,937
STATS ChipPAC Ltd.:
7.50%, 7/19/10		150		151,313
6.75%, 11/15/11		330		328,762
Spansion, Inc., 3.79%, 6/01/13 (a)(b)(d)		1,460		1,445,400
				2,487,412
Software — 0.1%
JDA Software Group, Inc., 8.00%, 12/15/14 (b)		150		154,500
Specialty Retail — 0.4%
United Auto Group, Inc., 7.75%, 12/15/16		915		872,681
Textiles, Apparel & Luxury Goods — 1.0%
Quiksilver, Inc., 6.88%, 4/15/15		2,525		2,152,563
Wireless Telecommunication Services — 3.1%
Cricket Communications, Inc.:
9.38%, 11/01/14		80		79,600
10.00%, 7/15/15		140		141,750
7.75%, 5/15/16		2,020		2,052,825
Digicel Group Ltd., 12.00%, 4/01/14 (b)		800		892,000
MetroPCS Wireless, Inc., 9.25%, 11/01/14		2,000		1,995,000
Nextel Communications, Inc.:
Series E, 6.88%, 10/31/13		690		662,400
Series F, 5.95%, 3/15/14		100		90,750
Orascom Telecom Finance SCA, 7.88%, 2/08/14 (b)		395		347,600
Sprint Capital Corp.:
7.63%, 1/30/11		220		224,400
6.88%, 11/15/28		370		280,275
				6,766,600
Total Corporate Bonds — 62.6%				138,186,970

Floating Rate Loan Interests (e)	Par (000)		Value
Aerospace & Defense — 0.3%
Hawker Beechcraft Acquisition Co. LLC:
Letter of Credit Facility Deposit, 0.15%, 3/26/14	USD	52	$	37,902
Term Loan, 2.25%, 3/26/14		870		640,663
				678,565
Airlines — 0.5%
Delta Air Lines, Inc., Credit-Linked Deposit Loan, 0.10% – 2.25%, 4/30/12		1,225		1,144,355
Auto Components — 2.5%
Allison Transmission, Inc., Term Loan, 2.98% – 3.00%, 8/07/14		5,040		4,615,308
Dana Holding Corp., Term Advance, 4.48% – 6.50%, 1/30/15		647		630,538
The Goodyear Tire & Rubber Co., Loan (Second Lien), 2.34%, 4/30/14		300		278,375
Lear Corp., Closing Date Loan and Delayed Draw Loan, 7.50%, 11/09/14		125		125,260
				5,649,481
Automobiles — 1.0%
Ford Motor Co.:
Tranche B-1 Term Loan, 3.24% – 3.26%, 12/15/13		1,067		988,521
Tranche B-2 Term Loan, 3.26%, 12/15/13		1,247		1,155,408
				2,143,929
Building Products — 1.8%
Building Materials Corp. of America:
Second Lien Term Loan, 6.00%, 9/15/14		1,250		1,230,000
Term Loan Advance, 3.00%, 2/22/14		1,223		1,190,924
Goodman Global, Inc., Term Loan, 6.25%, 2/13/14		1,538		1,544,353
				3,965,277
Chemicals — 3.7%
Ashland Inc., Term B Borrowing, 7.65%, 5/13/14		274		277,063
Chemtura Corp., Term Facility Debtor in Possession, 6.00%, 1/26/11		800		803,500
Gentek Holding, LLC, Tranche B Term Loan, 7.00%, 10/29/14		400		402,000
Nalco Co., Term Loan, 6.50%, 5/13/16		1,020		1,027,014
PQ Corp., Original Term Loan (First Lien), 3.48% – 3.50%, 7/30/14		3,928		3,593,692
Rockwood Specialties Group, Inc., Term Loan H, 6.00%, 5/15/14		878		880,886
Solutia Inc., Loan, 7.25%, 2/28/14		1,101		1,114,849
				8,099,004
Commercial Services & Supplies — 1.6%
ARAMARK Corp., Facility Letter of Credit, 0.09%, 1/26/14		64		61,273
ARAMARK Corp., US Term Loan, 2.13%, 1/26/14		977		931,705
Casella Waste Systems, Inc., Term B Loan, 7.00%, 4/09/14		219		220,268
John Maneely Co., Term Loan, 3.50%, 12/09/13		725		679,528
Synagro Technologies, Inc., Term Loan (First Lien), 2.23%, 4/02/14		424		373,750
West Corp., Incremental Term B-3 Loan, 7.25%, 10/24/13		1,269		1,281,959
				3,548,483
Construction & Engineering — 0.9%
Brand Energy & Infrastructure Services, Inc. (FR Brand Acquisition Corp.), Synthetic Letter of Credit, Term Loan (First Lien), 0.31%, 2/07/14		500		440,000
Safway Services, LLC, First Out Term Loan, 9.00%, 12/14/17		1,500		1,500,000
				1,940,000

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	43

Schedule of Investments (continued)	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (e)	Par (000)		Value
Containers & Packaging — 0.8%
Anchor Glass Term Loan B, 6.00%, 2/18/16	USD	700	$	697,812
Berry Plastics Holding Corp., Term C Loan, 2.25%, 4/03/15		499		446,214
Graham Packaging Co., LP, B Term Loan, 2.50%, 10/07/11		577		568,680
				1,712,706
Diversified Consumer Services — 2.1%
Coinmach Service Corp., Term Loan, 3.25%, 11/14/14		1,965		1,699,649
Laureate Education, Series A New Term Loan, 7.00%, 8/15/14		2,960		2,933,138
				4,632,787
Diversified Financial Services — 0.4%
Reynolds Group Holdings Inc., US Term Loan, 6.25%, 11/05/15		900		905,625
Diversified Telecommunication Services — 0.8%
Cavtel Holdings, LLC, Term Loan, 8.50%, 12/31/12		423		361,968
Integra Telecom Holdings, Inc., Term Loan (First Lien), 10.50%, 8/31/13		892		891,631
US Telepacific Corp., Second Lien Term Loan, 7.75%, 7/25/15		400		400,750
				1,654,349
Electrical Equipment — 0.5%
Baldor Electric Co., Term Loan, 5.25%, 1/31/14		622		623,323
Generac Acquisition Corp., Term Loan (First Lien), 2.75%, 11/10/13		529		484,721
				1,108,044
Energy Equipment & Services — 0.7%
Dresser, Inc., Term Loan (Second Lien), 6.00%, 5/04/15		550		514,250
MEG Energy Corp., Tranche D Term Loan, 6.00%, 4/03/16		972		954,323
				1,468,573
Food & Staples Retailing — 1.4%
Pilot Travel Centers, Term Loan B, 3.50%, 11/18/15		1,250		1,255,795
Rite Aid Corp., Tranche 4 Term Loan, 9.50%, 6/10/15		1,200		1,243,200
SUPERVALU Inc., Term B Advance, 1.49%, 6/02/12		576		558,486
				3,057,481
Food Products — 2.5%
Dole Food Co., Inc.:
Credit-Linked Deposit, 0.17%, 08/30/10		828		827,754
Term Loan B, 3.50%, 2/10/17		588		588,529
Term Loan C, 5.50%, 2/10/17		1,412		1,412,471
Pilgrim’s Pride Corp., Term Loan A, 5.29%, 12/01/12		500		492,500
Pinnacle Foods Finance LLC, Tranche C Term Loan, 7.50%, 4/02/14		1,700		1,706,982
Solvest, Ltd. (Dole), Tranche C Term Loan, 8.00%, 4/12/13		609		609,219
				5,637,455
Health Care Equipment & Supplies — 0.5%
Biomet, Inc., Dollar Term Loan, 3.23% – 3.25%, 3/25/15		349		337,682
DJO Finance LLC (ReAble Therapeutics Finance LLC), Term Loan, 3.23%, 5/20/14		885		854,836
				1,192,518

Floating Rate Loan Interests (e)	Par (000)		Value
Health Care Providers & Services — 3.2%
CHS/Community Health Systems, Inc.:
Delayed Draw Term Loan, 2.50%, 7/25/14	USD	100	$	93,933
Funded Term Loan, 2.48% – 2.50%, 7/25/14		1,926		1,799,447
DaVita Inc., Tranche B-1 Term Loan, 1.73% – 1.76%, 10/05/12		300		292,987
Fresenius SE:
Tranche B1 Term Loan, 6.75%, 9/10/14		534		537,322
Tranche B2 Term Loan, 6.75%, 9/10/14		288		289,462
HCA Inc., Tranche A-1 Term Loan, 1.75%, 11/16/12		3,071		2,900,778
Vanguard Health Holding Company II, LLC (Vanguard Health Systems, Inc.), Initial Term Loan, 5.00%, 1/29/16		1,100		1,101,375
				7,015,304
Health Care Technology — 0.7%
IMS Healthcare, Term Loan B, 5.25%, 2/16/16		1,600		1,606,400
Hotels, Restaurants & Leisure — 4.3%
Blackstone UTP Capital LLC, Loan, 7.75%, 11/06/14		1,250		1,257,031
Cedar Fair LP, Term Loan B, 4.00%, 2/04/16		1,050		1,048,360
Harrah’s Operating Co., Inc.:
Term B-2 Loan, 3.25%, 1/28/15		557		449,504
Term B-4 Loan, 9.50%, 10/31/16		1,250		1,246,527
QCE, LLC (Quiznos), Term Loan (First Lien), 2.56%, 5/05/13		390		332,638
Six Flags Theme Parks, Inc., Term Loan, 4.50%, 6/13/15		3,000		2,972,250
SW Acquisitions Co., Inc., Term Loan, 5.75%, 6/01/16		1,250		1,255,469
VML US Finance LLC (aka Venetian Macau):
New Project Term Loan, 4.76%, 5/27/13		834		792,351
Term B Delayed Draw Project Loan, 4.76%, 5/25/12		209		198,088
				9,552,218
IT Services — 2.3%
Audio Visual Services Group, Inc.:
Loan (Second Lien), 5.76%, 2/28/14		538		53,852
Tranche B Term Loan (First Lien), 2.51%, 2/28/14		995		696,438
Ceridian Corp., US Term Loan, 3.23% – 3.25%, 11/09/14		1,483		1,296,639
First Data Corp.:
Initial Tranche B-2 Term Loan, 3.00%, 9/24/14		1,470		1,282,472
Initial Tranche B-3 Term Loan, 3.00%, 9/24/14		389		338,391
RedPrairie Corp.:
Tack-On Loan, 3.31%, 7/20/12		242		234,574
Term Loan B, 3.31%, 7/20/12		564		546,681
SunGard Data Systems Inc. (Solar Capital Corp.), Incremental Term Loan, 6.75%, 2/28/14		746		748,833
				5,197,880
Independent Power Producers & Energy Traders — 0.5%
Dynegy Holdings Inc.:
Term Letter of Credit Facility Term Loan, 3.98%, 4/02/13		463		451,507
Tranche B Term Loan, 3.98%, 4/02/13		37		36,346
Texas Competitive Electric Holdings Co., LLC (TXU):
Initial Tranche B-2 Term Loan, 3.73% – 3.75%, 10/10/14		484		389,046
Initial Tranche B-3 Term Loan, 3.73% – 3.75%, 10/10/14		227		181,677
				1,058,576

See Notes to Financial Statements.
44	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (continued)	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Floating Rate Loan Interests (e)	Par (000)		Value
Industrial Conglomerates — 0.2%
Sequa Corp., Term Loan, 3.51 – 3.94%, 12/03/14	USD	450	$	411,589
Insurance — 0.1%
Alliant Holdings I, Inc., Term Loan, 3.25%, 8/21/14		142		134,290
Internet & Catalog Retail — 0.3%
FTD Group, Inc., Tranche B Term Loan, 6.75%, 8/26/14		633		633,587
Leisure Equipment & Products — 0.7%
Fender Musical Instruments Corp.:
Delayed Draw Loan, 2.51%, 6/09/14		657		556,990
Initial Loan, 2.51%, 6/09/14		1,301		1,102,670
				1,659,660
Machinery — 1.3%
Bucyrus International, Term Loan C, 4.50%, 1/26/16		750		753,975
LN Acquisition Corp. (Lincoln Industrial), Initial Term Loan (Second Lien), 5.98%, 1/09/15		1,000		840,000
Oshkosh Truck Corp., Term B Loan, 6.25% – 6.26%, 12/06/13		1,374		1,372,737
				2,966,712
Media — 10.4%
Affinion Group Holdings, Inc., Loan, 8.39%, 3/01/12		1,479		1,397,396
Cengage Learning Acquisitions, Inc. (Thomson Learning), Tranche 1 Incremental Term Loan, 7.50%, 7/03/14		4,079		4,038,500
Cequel Communications, LLC, Tranche B Term PIK Facility (Second Lien), 6.25%, 5/05/14		1,813		1,815,783
Charter Communications Operating, LLC, New Term Loan, 2.23% – 2.26%, 3/06/14		2,500		2,331,930
Ellis Communications KDOC, LLC, Loan, 10.00%, 12/30/11		3,879		1,086,013
HMH Publishing Co. Ltd., Tranche A Term Loan, 5.23%, 6/12/14		1,443		1,214,428
Hanley-Wood, LLC (FSC Acquisition), Term Loan, 2.50% – 2.56%, 3/10/14		978		436,617
Lamar Media Corp.:
Series B, Incremental Loan, 5.50% – 5.75%, 9/28/12		517		513,403
Term Loan, 5.50% – 5.75%, 9/28/12		903		896,426
MCC Iowa LLC (Mediacom Broadband Group), Tranche E Term Loan, 6.50%, 1/03/16		274		275,800
Mediacom Illinois, LLC (fka Mediacom Communications, LLC), Tranche D Term Loan, 5.50%, 3/31/17		499		498,122
Newsday, LLC, Fixed Rate Term Loan, 10.50%, 8/01/13		3,250		3,473,437
Penton Media, Inc., Term Loan (First Lien), 2.48% – 2.50%, 2/01/13		729		532,444
Sinclair Television Group, Inc., Tranche B Term Loan, 6.50%, 10/29/15		500		502,500
Sunshine Acquisition Ltd. (aka HIT Entertainment), Term Facility, 2.50%, 3/20/12		1,200		1,055,000
UPC Financing Partnership, Facility, 3.93%, 12/30/16		1,750		1,701,000
Worldcolor Press Inc. and Worldcolor (USA) Corp. (fka Quebecor World, Inc.), Advance, 9.00%, 7/23/12		498		503,176
Yell Group Plc TPI, Term Loan A, 7.12%, 8/09/11		750		718,125
				22,990,100

Floating Rate Loan Interests (e)	Par (000)		Value
Metals & Mining — 1.4%
Euramax International, Inc.:
Term Facility, 10.00%, 6/29/13	USD	858	$	694,756
Domestic Term Facility, 14.00%, 6/29/13 (f)		871		705,902
RathGibson, Inc., Loan, Debtor in Possession 10.75%, 6/30/10 (f)		1,796		1,795,560
				3,196,218
Multi-Utilities — 0.3%
FirstLight Power Resources, Inc. (fka NE Energy, Inc.):
Synthetic Letter of Credit, 0.16%, 11/01/13		63		58,981
Term B Advance (First Lien), 2.75%, 11/01/13		687		640,641
				699,622
Multiline Retail — 0.6%
Dollar General Corp., Tranche B-2 Term Loan, 2.98%, 7/07/14		983		945,267
The Neiman Marcus Group Inc., Term Loan, 2.26%, 4/06/13		350		314,144
				1,259,411
Oil, Gas & Consumable Fuels — 0.8%
Big West Oil, LLC, Initial Loan:
Delayed Advance Loan, 4.50%, 5/15/14		546		535,247
Initial Advance Loan, 4.50%, 5/15/14		434		425,765
Term Loan B, 9.75%, 1/26/15		750		753,750
				1,714,762
Paper & Forest Products — 0.2%
Georgia-Pacific LLC, Term Loan B, 2.25% – 2.26%, 12/23/12		457		446,052
Personal Products — 0.3%
American Safety Razor Co., LLC:
Loan (Second Lien), 6.51%, 1/30/14		600		351,000
Term Loan (First Lien), 2.75% – 2.76%, 7/31/13		374		339,726
				690,726
Pharmaceuticals — 1.0%
Warner Chilcott Co., LLC, Term A Loan, 5.50%, 10/30/14		644		643,907
Warner Chilcott Corp.:
Additional Term Loan, 5.75%, 4/30/15		495		495,135
Term B-1 Loan, 5.75%, 4/30/15		322		321,813
Term B-2 Loan, 5.75%, 4/30/15		708		707,988
				2,168,843
Professional Services — 0.4%
Booz Allen Hamilton Inc., Term Loan C, 6.00%, 7/31/15		1,000		1,003,125
Real Estate Management & Development — 1.2%
Realogy Corp., Synthetic Letter of Credit, 0.1%, 10/10/13		2,925		2,579,318
Specialty Retail — 0.9%
Adesa, Inc. (KAR Holdings, Inc.), Initial Term Loan, 2.98%, 10/21/13		611		588,904
Michaels Stores, Inc.:
B-1 Term Loan, 2.50% – 2.56%, 10/31/13		642		577,854
B-2 Term Loan, 4.75% – 4.81%, 7/31/16		768		731,512
				1,898,270
Wireless Telecommunication Services — 1.1%
Digicel International Finance Ltd., Tranche A, 2.81%, 3/30/12		2,033		1,957,099
MetroPCS Wireless, Inc., Tranche B Term Loan, 2.50%, 11/03/13		499		480,478
				2,437,577
Total Floating Rate Loan Interests — 54.2%				119,858,872

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	45

Schedule of Investments (continued)	BlackRock Senior High Income Fund, Inc. (ARK)
	(Percentages shown are based on Net Assets)

Other Interests (i)	Beneficial Interest (000)			Value
Auto Components — 0.1%
Intermet Liquidating Trust Class A	USD	521		$	151,846
Diversified Financial Services — 0.4%
J. G. Wentworth LLC Preferred Equity Interests		—	(j)		914,658
Media — 0.0%
Adelphia Preferred Escrow		3			—
Adelphia Recovery Trust		250			25
					25
Total Other Interests — 0.5%					1,066,529

Warrants (k)	Shares
Media — 0.0%
Charter Communications (Expires 11/30/14)		6,862	27,448
Total Warrants — 0.0%			27,448
Total Long-Term Investments (Cost — $291,271,751) — 119.3%			263,741,332

Short-Term Securities
BlackRock Liquidity Funds, TempFund, Institutional Class, 0.09% (l)(m)	1,938,484	1,938,484

	Beneficial Interest (000)
Bank of New York Cash Reserves, 0.05% (m)	USD	1,011		1,010,656
Total Short-Term Securities (Cost — $2,949,140) — 1.3%				2,949,140
Total Investments (Cost — $294,220,891*) — 120.6%				266,690,472
Liabilities in Excess of Other Assets — (20.6)%				(45,517,527	)
Net Assets — 100.0%			$	221,172,945

^* The cost and unrealized appreciation (depreciation) of investments as of February 28, 2010, as computed for federal income tax purposes, were as follows:

Aggregate cost	$	294,821,503
Gross unrealized appreciation	$	9,088,996
Gross unrealized depreciation		(37,120,127	)
Net unrealized depreciation	$	(28,031,131	)

(a)	Non-income producing security.
(b)	Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)	As a result of bankruptcy proceedings, the company did not repay the principal amount of the security upon maturity.
(d)	Issuer filed for bankruptcy and/or is in default of interest payments.
(e)	Variable rate security. Rate shown is as of report date.
(f)	Represents a payment-in-kind security which may pay interest/dividends in additional face/shares.
(g)	Convertible security.
(h)	Represents a step-down bond that pays an initial coupon rate for the first period and then a lower coupon rate for the following periods. Rate shown reflects the current yield as of report date.
(i)	Other interests represent beneficial interest in liquidation trusts and other reorganization entities and are non-income producing.
(j)	Amount is less than $1,000.
(k)	Warrants entitle the Fund to purchase a predetermined number of shares of common stock and are non-income producing. The purchase price and number of shares are subject to adjustment under certain conditions until the expiration date.
(l)	Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows:

Affiliate	Net Activity			Income
BlackRock Liquidity Funds, TempFund, Institutional Class	$	1,938,484		$	6,626
BlackRock Liquidity Series, LLC Cash Sweep Series	$	(4,346,896	)	$	1,683

(m)	Represents the current yield as of report date.
•	For Fund compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease. These industry classifications are unaudited.
•	Foreign currency exchange contracts as of February 28, 2010 were as follows:

Currency Purchased		Currency Sold		Counterparty	Settlement Date	Unrealized Appreciation
USD	572,542	CAD	599,500	Citibank NA	4/21/10	$        2,836

• Credit default swaps on single-name issues — buy protection outstanding as of February 28, 2010 were as follows:

Issuer	Pay Fixed Rate	Counterparty	Expiration	Notional Amount (000)	Unrealized Appreciation (Depreciation)
K. Hovnanian	5.00%	Goldman Sachs	December 2011	USD 460	$	(2,961	)
Enterprises, Inc.		Bank USA
K. Hovnanian	5.00%	Goldman Sachs	December 2012	USD 225		1,544
Enterprises, Inc.		Bank USA
Boston	1.00%	Goldman Sachs	December 2014	USD 500		919
Scientific Corp.		Bank USA
Total					$	(498	)

See Notes to Financial Statements.
46	ANNUAL REPORT	FEBRUARY 28, 2010

Schedule of Investments (concluded) BlackRock Senior High Income Fund, Inc. (ARK)

•	Fair Value Measurements — Various inputs are used in determining the fair value of investments, which are as follows:
	•	Level 1 — price quotations in active markets/exchanges for identical assets and liabilities
	•	Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)
	•	Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the face value of investments)
	The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.
	The following tables summarize the inputs used as of February 28, 2010 in determining the investments:

	Investments in Securities
Valuation Inputs	Level 1		Level 2		Level 3		Total
Assets:
Long-Term Investments
Common Stocks	$	3,387,205	$	1,035,196	$	179,112	$	4,601,513
Corporate Bonds		—		130,174,179		8,012,790		138,186,969
Floating Rate Loan Interests		—		102,845,901		17,012,972		119,858,873
Other Interests		—		—		1,066,529		1,066,529
Warrants		—		27,448		—		27,448
Short-Term Securities		1,938,484		1,010,656		—		2,949,140
Total	$	5,325,689	$	235,093,380	$	26,271,403	$	266,690,472

	Other Financial Instruments1
Valuation Inputs	Level 1		Level 2			Level 3		Total
Assets		—	$	5,299			—	$	5,299
Liabilities		—		(2,961	)		—		(2,961	)
Total		—	$	2,338			—	$	2,338

¹ Other financial instruments are foreign currency exchange contracts and swaps which are shown at the unrealized appreciation/depreciation on the instrument.

The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair value:

	Investments in Securities
	Common Stocks		Corporate Bonds			Floating Rate Loan Interests			Other Interests		Total
Balance, as of February 28, 2009	$	55,975	$	8,229,614		$	44,351,083		$	25	$	52,636,697
Accrued discounts/premiums		—		—			—			—		—
Realized gain (loss)		—		(1,313,608	)		(9,136,141	)		—		(10,449,749	)
Change in unrealized appreciation/depreciation2		—		2,016,897			25,598,951			—		27,615,848
Net purchases (sales)		—		(2,115,281	)		(28,993,766	)		—		(31,109,047	)
Net transfers in (out) of Level 3		123,137		1,195,168			(14,807,155	)		1,066,504		(12,422,346	)
Balance, as of February 28, 2010	$	179,112	$	8,012,790		$	17,012,972		$	1,066,529	$	26,271,403

² Included in the related net change in unrealized appreciation/depreciation on the Statements of Operations. The change in the unrealized appreciation/depreciation on the securities still held on February 28, 1010 was $4,608,899.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	47

Statements of Assets and Liabilities

February 28, 2010	BlackRock Corporate High Yield Fund, Inc. (COY)			BlackRock Corporate High Yield Fund III, Inc. (CYE)			BlackRock Debt Strategies Fund, Inc. (DSU)			BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)			BlackRock Senior High Income Fund, Inc. (ARK)
Assets
Investments at value — unaffiliated1	$	289,988,900		$	313,342,249		$	502,769,695		$	168,472,349		$	264,751,988
Investments at value — affiliated2		4,931,674			3,276,755			1,319,723			1,797,812			1,938,484
Unrealized appreciation on foreign currency exchange contracts		1,401,730			1,456,164			1,642,856			523,805			2,836
Unrealized appreciation on swaps		18,639			5,534			4,571			856			2,463
Unrealized appreciation on unfunded loan commitments		—			95			—			4,076			—
Foreign currency at value3		1,025,174			1,010,962			536,981			327,836			475
Cash		11,446			—			23,555			—			—
Cash pledged as collateral for swaps		500,000			—			—			—			—
Investments sold receivable		11,070,027			11,256,876			14,395,121			7,615,228			12,416,176
Interest receivable		5,495,712			5,635,563			6,668,181			1,617,492			3,177,637
Swap premiums paid		705,486			387,496			93,268			—			42,060
Principal paydowns receivable		169,000			—			—			89,466			—
Swaps receivable		120,750			121,722			5,337			7,389			—
Dividends receivable		18,400			33,160			59,496			—			—
Commitment fees receivable		—			31			—			660			—
Prepaid expenses		18,345			19,510			35,515			11,127			18,293
Other assets		4,515			4,515			588,243			—			100,154
Total assets		315,479,798			336,550,632			528,142,542			180,468,096			282,450,566
Liabilities
Loan payable		72,000,000			76,000,000			67,000,000			24,000,000			43,000,000
Unrealized depreciation on swaps		381,198			235,526			109,385			—			2,961
Unrealized depreciation on foreign currency exchange contracts		25,617			19,428			63,523			42,902			—
Unrealized depreciation on unfunded loan commitments		51,643			115,674			—			38,101			—
Cash held as collateral for swaps		600,000			—			—			—			—
Bank overdraft		—			1,393,499			—			4,446			—
Investments purchased payable		11,271,316			8,475,627			40,960,112			17,801,366			17,898,019
Swap premiums received		178,998			189,313			3,597			—			1,998
Interest expense payable		115,205			130,247			127,672			54,307			38,704
Investment advisory fees payable		112,531			147,925			223,470			95,116			98,937
Swaps payable		64,031			33,226			17,354			—			7,632
Other affiliates payable		838			918			1,448			496			776
Officer’s and Directors’ fees payable		627			821			65,690			373			271
Other accrued expenses payable		85,256			87,859			144,003			60,293			128,424
Other liabilities		—			—			204,300			12			99,899
Total liabilities		84,887,260			86,830,063			108,920,554			42,097,412			61,277,621
Net Assets	$	230,592,538		$	249,720,569		$	419,221,988		$	138,370,684		$	221,172,945
Net Assets Consist of
Paid-in capital4	$	381,684,497		$	439,423,631		$	882,189,849		$	199,603,356		$	401,676,162
Undistributed (distributions in excess of) net investment income		649,435			(405,353	)		(1,165,262	)		(718,024	)		3,223,424
Accumulated net realized loss		(146,430,319	)		(183,691,236	)		(370,143,030	)		(53,030,772	)		(156,198,567	)
Net unrealized appreciation/depreciation		(5,311,075	)		(5,606,473	)		(91,659,569	)		(7,483,876	)		(27,528,074	)
Net Assets	$	230,592,538		$	249,720,569		$	419,221,988		$	138,370,684		$	221,172,945
Net asset value	$	6.64		$	6.69		$	3.89		$	13.16		$	3.91
1 Investments at cost — unaffiliated	$	296,253,633		$	320,041,899		$	596,533,280		$	176,512,609		$	292,282,407
2 Investments at cost — affiliated	$	4,931,674		$	3,276,755		$	1,319,723		$	1,797,812		$	1,938,484
3 Foreign currency at cost	$	1,024,800		$	1,011,928		$	437,498		$	332,318		$	469
4 Shares outstanding, 200 million shares authorized, par value $0.10 per share		34,713,378			37,333,466			107,657,486			10,516,588			56,542,893

See Notes to Financial Statements.
48	ANNUAL REPORT	FEBRUARY 28, 2010

Statements of Operations

February 28, 2010	BlackRock Corporate High Yield Fund, Inc. (COY)			BlackRock Corporate High Yield Fund III, Inc. (CYE)			BlackRock Debt Strategies Fund, Inc. (DSU)			BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)			BlackRock Senior High Income Fund, Inc. (ARK)
Investment Income
Interest	$	24,368,481		$	26,209,932		$	46,119,469		$	10,615,795		$	22,135,529
Foreign taxes withheld		(1,021	)		—			—			(4	)		—
Facility and other fees		298,923			355,798			550,367			200,468			437,971
Dividends		31,258			65,051			—			—			—
Income — affiliated		9,075			8,667			13,475			8,225			8,309
Total income		24,706,716			26,639,448			46,683,311			10,824,484			22,581,809
Expenses
Investment advisory		1,195,391			1,554,655			2,441,895			1,078,081			1,104,348
Borrowing costs1		247,486			262,737			421,005			182,944			281,903
Professional		111,625			114,138			207,613			115,629			138,190
Accounting services		59,672			59,151			118,896			25,293			52,819
Transfer agent		44,359			41,010			107,846			28,675			57,446
Custodian		24,320			30,070			26,762			34,925			15,879
Officer and Directors		24,124			27,647			65,483			15,036			23,204
Printing		18,190			20,678			47,059			19,437			28,533
Registration		11,866			12,805			37,801			9,166			19,296
Miscellaneous		68,991			72,220			92,893			40,254			62,126
Total expenses excluding interest expense		1,806,024			2,195,111			3,567,253			1,549,440			1,783,744
Interest expense		522,339			609,174			728,880			276,153			374,716
Total expenses		2,328,363			2,804,285			4,296,133			1,825,593			2,158,460
Less fees waived by advisor		(1,759	)		(1,523	)		(1,987	)		(1,791	)		(1,533	)
Total expenses after fees waived		2,326,604			2,802,762			4,294,146			1,823,802			2,156,927
Net investment income		22,380,112			23,836,686			42,389,165			9,000,682			20,424,882
Realized and Unrealized Gain (Loss)
Net realized loss from:
Investments		(16,893,502	)		(14,858,314	)		(107,086,708	)		(17,068,037	)		(38,830,698	)
Swaps		(442,843	)		(173,346	)		(783,756	)		(499,772	)		(1,213,910	)
Foreign currency transactions		(910,026	)		(1,036,513	)		(1,420,605	)		(939,197	)		(86,342	)
		(18,246,371	)		(16,068,173	)		(109,291,069	)		(18,507,006	)		(40,130,950	)
Net change in unrealized appreciation/depreciation on:
Investments		102,229,656			111,446,486			275,386,401			61,689,507			113,616,454
Swaps		2,936,980			3,295,592			(1,563,576	)		2,901,019			450,201
Foreign currency transactions		1,054,018			1,143,051			1,674,640			337,733			(8,560	)
Unfunded loan commitments		(51,643	)		(115,674	)		—			142,635			—
		106,169,011			115,769,455			275,497,465			65,070,894			114,058,095
Total realized and unrealized gain		87,922,640			99,701,282			166,206,396			46,563,888			73,927,145
Net Increase in Net Assets Resulting from Operations	$	110,302,752		$	123,537,968		$	208,595,561		$	55,564,570		$	94,352,027

¹ See Note 6 of the Notes to Financial Statements for details of short-term borrowings.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	49

Statements of Changes in Net Assets

	BlackRock Corporate High Yield Fund, Inc. (COY)									BlackRock Corporate High Yield Fund III, Inc. (CYE)
Increase (Decrease) in Net Assets:	Year Ended February 28, 2010			Period June 1, 2008 to February 28, 2009			Year Ended May 31, 2008			Year Ended February 28, 2010			Period June 1, 2008 to February 28, 2009			Year Ended May 31, 2008
Operations
Net investment income	$	22,380,112		$	17,171,877		$	25,842,085		$	23,836,686		$	18,684,715		$	27,155,524
Net realized loss		(18,246,371	)		(34,537,665	)		(9,129,906	)		(16,068,173	)		(36,996,389	)		(9,283,103	)
Net change in unrealized appreciation/depreciation		106,169,011			(86,397,451	)		(36,722,065	)		115,769,455			(93,986,807	)		(40,223,490	)
Net increase (decrease) in net assets resulting from operations		110,302,752			(103,763,239	)		(20,009,886	)		123,537,968			(112,298,481	)		(22,351,069	)
Dividends to Shareholders From
Net investment income		(25,342,365	)		(19,134,959	)		(26,113,293	)		(25,189,541	)		(20,800,925	)		(28,767,885	)
Capital Share Transactions
Reinvestment of dividends		832,119			—			—			111,029			—			—
Net Assets
Total increase (decrease) in net assets		85,792,506			(122,898,198	)		(46,123,179	)		98,459,456			(133,099,406	)		(51,118,954	)
Beginning of period		144,800,032			267,698,230			313,821,409			151,261,113			284,360,519			335,479,473
End of period	$	230,592,538		$	144,800,032		$	267,698,230		$	249,720,569		$	151,261,113		$	284,360,519
Undistributed (distributions in excess of) net investment income	$	649,435		$	4,243,346		$	5,504,375		$	(405,353	)	$	1,653,945		$	3,076,301

	BlackRock Debt Strategies Fund, Inc. (DSU)						BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)
	Year Ended February 28,						Year Ended February 28,
Increase (Decrease) in Net Assets:	2010			2009			2010			2009
Operations
Net investment income	$	42,389,165		$	55,149,566		$	9,000,682		$	14,429,059
Net realized loss		(109,291,069	)		(103,719,990	)		(18,507,006	)		(31,870,409	)
Net change in unrealized appreciation/depreciation		275,497,465			(229,565,826	)		65,070,894			(41,438,156	)
Net increase (decrease) in net assets resulting from operations		208,595,561			(278,136,250	)		55,564,570			(58,879,506	)
Dividends to Shareholders From
Net investment income		(41,936,207	)		(65,857,392	)		(10,283,447	)		(16,017,675	)
Tax return of capital		(926,392	)		—			(825,748	)		—
Total dividends and distributions to shareholders		(42,862,599	)		(65,857,392	)		(11,109,195	)		(16,017,675	)
Capital Share Transactions
Reinvestment of dividends		1,409,077			1,869,284			259,478			—
Net Assets
Total increase (decrease) in net assets		167,142,039			(342,124,358	)		44,714,853			(74,897,181	)
Beginning of year		252,079,949			594,204,307			93,655,831			168,553,012
End of year	$	419,221,988		$	252,079,949		$	138,370,684		$	93,655,831
Undistributed (distributions in excess of) net investment income	$	(1,165,262	)	$	(749,083	)	$	(718,024	)	$	1,132,254

See Notes to Financial Statements.
50	ANNUAL REPORT	FEBRUARY 28, 2010

Statements of Changes in Net Assets (concluded)

	BlackRock Senior High Income Fund, Inc. (ARK)
	Year Ended February 28,
Increase (Decrease) in Net Assets:	2010			2009
Operations
Net investment income	$	20,424,882		$	23,218,610
Net realized loss		(40,130,950	)		(55,099,290	)
Net change in unrealized appreciation/depreciation		114,058,095			(82,255,118	)
Net increase (decrease) in net assets resulting from operations		94,352,027			(114,135,798	)
Dividends and Distributions to Shareholders From
Net investment income		(16,952,851	)		(24,063,310	)
Tax return of capital		—			(3,089,535	)
Total dividends and distributions to shareholders		(16,952,851	)		(27,152,845	)
Capital Share Transactions
Reinvestment of dividends		130,893			239,560
Net Assets
Total increase (decrease) in net assets		77,530,069			(141,049,083	)
Beginning of year		143,642,876			284,691,959
End of year	$	221,172,945		$	143,642,876
Undistributed (distributions in excess of) net investment income	$	3,223,424		$	(267,346	)

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	51

Statements of Cash Flows

Year Ended February 28, 2010	BlackRock Corporate High Yield Fund, Inc. (COY)			BlackRock Corporate High Yield Fund III, Inc. (CYE)			BlackRock Debt Strategies Fund, Inc. (DSU)			BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)			BlackRock Senior High Income Fund, Inc. (ARK)
Cash Provided by (Used for) Operating Activities
Net increase in net assets resulting from operations	$	110,302,752		$	123,537,968		$	208,595,561		$	55,564,570		$	94,352,027
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used for) operating activities:
(Increase) decrease in interest receivable		(425,202	)		(23,026	)		2,997,568			468,511			518,099
(Increase) decrease in swaps receivable		(78,039	)		(75,438	)		(5,337	)		29,557			20,215
Increase in commitment fees receivable		—			33			2,602			6,208			—
(Increase) decrease in other assets		19,470			28,723			(501,894	)		1,328			(100,154	)
(Increase) decrease in dividends receivable		(18,104	)		(19,829	)		17,112			—			—
(Increase) in prepaid expenses		(2,412	)		(2,843	)		(446	)		(728	)		(1,485	)
Increase in investment advisory fees payable		37,836			52,233			56,505			24,933			24,437
Increase (decrease) in interest expense payable		103,787			119,913			97,305			46,096			23,705
Decrease in other affiliates payable		(847	)		(947	)		(864	)		(264	)		(1,147	)
(Decrease) increase in accrued expenses payable		(24,140	)		(7,287	)		(21,566	)		(18,926	)		20,455
(Decrease) increase in swaps payable		63,371			32,567			(111,105	)		(59,164	)		(99,804	)
Cash collateral on swaps		2,400,000			—			—			—			1,500,000
Increase in other liabilities		—			—			204,300			12			99,899
Increase in Officer’s and Directors’ fees payable		503			690			40,983			240			154
Net periodic and termination payments of swaps		(734,482	)		(230,183	)		(955,523	)		35,214			(193,223	)
Net realized and unrealized gain		(88,911,297	)		(100,762,332	)		(165,230,764	)		(46,978,725	)		(73,390,383	)
Amortization of premium and discount on investments		(3,166,833	)		(3,735,805	)		(4,300,645	)		(1,663,014	)		(1,726,364	)
Paid-in-kind income		(1,074,464	)		(1,289,749	)		(2,923,978	)		(952,646	)		(805,362	)
Proceeds from sales and paydowns of long-term investments		189,981,530			217,650,077			343,049,000			130,545,501			167,966,835
Purchases of long-term investments		(217,385,568	)		(247,554,377	)		(320,122,079	)		(126,333,212	)		(168,733,701	)
Net proceeds from sales of short-term securities		2,179,589			5,093,767			3,402,598			2,310,366			1,397,755
Cash provided by (used for) operating activities		(6,732,550	)		(7,185,845	)		64,289,333			13,025,857			20,871,958
Cash Provided by (Used for) Financing Activities
Cash receipts from borrowings		131,000,000			149,000,000			255,000,000			109,000,000			135,000,000
Cash payments from borrowings		(97,700,000	)		(117,200,000	)		(278,000,000	)		(111,000,000	)		(139,000,000	)
Cash dividends paid to shareholders		(24,637,844	)		(25,216,305	)		(41,841,336	)		(10,958,900	)		(16,993,912	)
(Decrease) increase in bank overdraft		(926,999	)		1,393,499			—			4,446			—
Cash provided by (used for) financing activities		7,735,157			7,977,194			(64,841,336	)		(12,954,454	)		(20,993,912	)
Cash Impact from Foreign Exchange Fluctuations
Cash impact from foreign exchange fluctuations		(32,897	)		2,176			154,194			1,248			6
Cash
Net increase (decrease) in cash		969,710			793,525			(397,809	)		72,651			(121,948	)
Cash and foreign currency at beginning of year		66,910			217,437			958,345			255,185			122,423
Cash at end of year	$	1,036,620		$	1,010,962		$	560,536		$	327,836		$	475
Cash Flow Information
Cash paid for interest	$	418,552		$	489,261		$	631,575		$	230,057		$	351,011
Noncash Financing Activities
Capital shares issued in reinvestment of dividends paid to shareholders	$	832,119		$	111,029		$	1,409,077		$	259,478		$	130,893

A Statement of Cash Flows is presented when a Fund had a significant amount of borrowing during the year, based on the average borrowings outstanding in relation to average total assets.

See Notes to Financial Statements.
52	ANNUAL REPORT	FEBRUARY 28, 2010

Financial Highlights BlackRock Corporate High Yield Fund, Inc. (COY)

				Period June 1, 2008 to February 28, 2009
	Year Ended February 28, 2010
							Year Ended May 31,
							2008			2007			2006			2005
Per Share Operating Performance
Net asset value, beginning of period	$	4.19		$	7.74		$	9.07		$	8.52		$	8.53		$	8.48
Net investment income1		0.65			0.50			0.75			0.73			0.74			0.87
Net realized and unrealized gain (loss)		2.53			(3.50	)		(1.32	)		0.49			0.02			0.07
Net increase (decrease) from investment operations		3.18			(3.00	)		(0.57	)		1.22			0.76			0.94
Dividends from net investment income		(0.73	)		(0.55	)		(0.76	)		(0.67	)		(0.77	)		(0.89	)
Net asset value, end of period	$	6.64		$	4.19		$	7.74		$	9.07		$	8.52		$	8.53
Market price, end of period	$	6.88		$	3.91		$	7.28		$	8.47		$	7.42		$	8.46
Total Investment Return2
Based on net asset value		79.91	%		(38.98	)% 3		(5.49	)%		15.60	%		9.75	%		11.31	%
Based on market price		99.76	%		(39.46	)%3		(4.81	)%		23.96	%		(3.63	)%		13.75	%
Ratios to Average Net Assets
Total expenses		1.18	%		2.29	%4		2.33	%		3.25	%		2.39	%		1.69	%
Total expenses after fees waived and paid indirectly		1.18	%		2.29	%4		2.33	%		3.25	%		2.39	%		1.69	%
Total expenses after fees waived and paid indirectly and excluding interest expense		0.92	%		1.17	%4		0.83	%		0.91	%		0.90	%		0.87	%
Net investment income		11.36	%		11.45	%4		9.15	%		8.36	%		8.55	%		9.85	%
Supplemental Data
Net assets, end of period (000)	$	230,593		$	144,800		$	267,698		$	313,821		$	294,759		$	294,218
Borrowings outstanding, end of period (000)	$	72,000		$	38,700		$	64,700		$	126,200		$	127,700		$	100,600
Average borrowings outstanding during the period (000)	$	42,184		$	59,553		$	81,598		$	125,974		$	101,539		$	104,938
Portfolio turnover		85	%		37	%		38	%		62	%		57	%		57	%
Asset coverage, end of period per $1,000	$	4,203		$	4,742		$	5,138		$	3,487		$	3,308		$	3,925

1	Based on average shares outstanding.
2	Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
3	Aggregate total investment return.
4	Annualized.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	53

Financial Highlights BlackRock Corporate High Yield Fund III, Inc. (CYE)

	Year Ended February 28, 2010			Period June 1, 2008 to February 28, 2009
							Year Ended May 31,
							2008			2007			2006			2005
Per Share Operating Performance
Net asset value, beginning of period	$	4.05		$	7.62		$	8.99		$	8.46		$	8.46		$	8.43
Net investment income1		0.64			0.50			0.73			0.71			0.72			0.85
Net realized and unrealized gain (loss)		2.68			(3.51	)		(1.33	)		0.49			0.02			0.07
Net increase (decrease) from investment operations		3.32			(3.01	)		(0.60	)		1.20			0.74			0.92
Dividends from net investment income		(0.68	)		(0.56	)		(0.77	)		(0.67	)		(0.74	)		(0.89	)
Net asset value, end of period	$	6.69		$	4.05		$	7.62		$	8.99		$	8.46		$	8.46
Market price, end of period	$	6.67		$	3.57		$	7.03		$	8.53		$	7.36		$	8.38
Total Investment Return2
Based on net asset value		86.65	%		(39.69	)%3		(5.69	)%		15.51	%		9.78	%		11.24	%
Based on market price		111.12	%		(42.38	)%3		(8.30	)%		25.98	%		(3.59	)%		16.55	%
Ratios to Average Net Assets
Total expenses		1.34	%		2.45	%4		2.47	%		3.38	%		2.49	%		1.81	%
Total expenses after fees waived and paid indirectly		1.33	%		2.45	%4		2.47	%		3.38	%		2.49	%		1.81	%
Total expenses after fees waived and paid indirectly and excluding interest expense		1.04	%		1.29	%4		0.96	%		1.04	%		1.00	%		0.99	%
Net investment income		11.35	%		11.80	%4		9.01	%		8.25	%		8.45	%		9.71	%
Supplemental Data
Net assets, end of period (000)	$	249,721		$	151,261		$	284,361		$	335,479		$	315,699		$	315,626
Borrowings outstanding, end of period (000)	$	76,000		$	44,200		$	71,700		$	129,700		$	141,000		$	107,800
Average borrowings outstanding during the period (000)	$	49,196		$	65,500		$	88,466		$	134,704		$	109,144		$	112,501
Portfolio turnover		89	%		37	%		38	%		62	%		56	%		55	%
Asset coverage, end of period per $1,000	$	4,286		$	4,422		$	4,966		$	3,587		$	3,239		$	3,928

1	Based on average shares outstanding.
2	Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
3	Aggregate total investment return.
4	Annualized.

See Notes to Financial Statements.
54	ANNUAL REPORT	FEBRUARY 28, 2010

Financial Highlights BlackRock Debt Strategies Fund, Inc. (DSU)

	Year Ended February 28,						Year Ended February 29, 2008			Year Ended February 28,
	2010			2009						2007			2006
Per Share Operating Performance
Net asset value, beginning of year	$	2.35		$	5.57		$	7.01		$	6.69		$	7.06
Net investment income1		0.39			0.52			0.66			0.68			0.63
Net realized and unrealized gain (loss)		1.55			(3.12	)		(1.43	)		0.28			(0.35	)
Net increase (decrease) from investment operations		1.94			(2.60	)		(0.77	)		0.96			0.28
Dividends and distributions from:
Net investment income		(0.39	)		(0.62	)		(0.67	)		(0.64	)		(0.65	)
Tax return of capital		(0.01	)		—			—			—			—
Total dividends and distributions		(0.40	)		(0.62	)		(0.67	)		(0.64	)		(0.65	)
Net asset value, end of year	$	3.89		$	2.35		$	5.57		$	7.01		$	6.69
Market price, end of year	$	3.91		$	2.07		$	5.43		$	7.28		$	6.77
Total Investment Return2
Based on net asset value		87.82	%		(50.19	)%		(11.72	)%		15.35	%		4.57	%
Based on market price		114.32	%		(54.99	)%		(17.13	)%		18.37	%		11.34	%
Ratios to Average Net Assets
Total expenses		1.23	%		2.42	%		3.13	%		3.16	%		2.63	%
Total expenses after fees waived		1.23	%		2.42	%		3.13	%		3.16	%		2.63	%
Total expenses after fees waived and excluding interest expense		1.02	%		1.20	%		0.99	%		0.99	%		1.02	%
Net investment income		12.16	%		11.79	%		9.90	%		9.97	%		9.55	%
Supplemental Data
Net assets, end of year (000)	$	419,222		$	252,080		$	594,204		$	745,944		$	708,411
Borrowings outstanding, end of year (000)	$	67,000		$	90,000		$	199,000		$	298,600		$	259,900
Average borrowings outstanding during the year (000)	$	58,574		$	163,286		$	272,846		$	283,906		$	294,371
Portfolio turnover		86	%		44	%		51	%		65	%		46	%
Asset coverage, end of year per $1,000	$	7, 257		$	3,801		$	3,986		$	3,498		$	3,726

1	Based on average shares outstanding.
2	Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	55

Financial Highlights BlackRock Floating Rate Income Strategies Fund II, Inc. (FRB)

	Year Ended February 28,						Year Ended February 29, 2008			Year Ended February 28,
	2010			2009						2007			2006
Per Share Operating Performance
Net asset value, beginning of year	$	8.92		$	16.06		$	19.28		$	19.39		$	19.74
Net investment income1		0.86			1.37			1.55			1.55			1.33
Net realized and unrealized gain (loss)		4.44			(6.98	)		(3.27	)		(0.12	)		(0.31	)
Net increase (decrease) from investment operations		5.30			(5.61	)		(1.72	)		1.43			1.02
Dividends and distributions from:
Net investment income		(0.98	)		(1.53	)		(1.50	)		(1.54	)		(1.27	)
Net realized gain		—			—			—			—			(0.10	)
Tax return of capital		(0.08	)		—			—			—			—
Total dividends and distributions		(1.06	)		(1.53	)		(1.50	)		(1.54	)		(1.37	)
Net asset value, end of year	$	13.16		$	8.92		$	16.06		$	19.28		$	19.39
Market price, end of year	$	15.01		$	8.28		$	14.75		$	18.50		$	17.76
Total Investment Return2
Based on net asset value		62.08	%		(36.46	)%		(8.98	)%		8.31	%		6.07	%
Based on market price		99.15	%		(35.78	)%		(12.88	)%		13.47	%		(1.35	)%
Ratios to Average Net Assets
Total expenses		1.50	%		2.48	%		2.78	%		2.87	%		2.46	%
Total expenses after fees waived and paid indirectly		1.50	%		2.48	%		2.78	%		2.87	%		2.46	%
Total expenses after fees waived and paid indirectly and excluding interest expense		1.27	%		1.38	%		1.20	%		1.22	%		1.25	%
Net investment income		7.40	%		10.08	%		8.39	%		8.03	%		6.88	%
Supplemental Data
Net assets, end of year (000)	$	138,371		$	93,656		$	168,553		$	202,364		$	203,557
Borrowings outstanding, end of year (000)	$	24,000		$	26,000		$	50,000		$	47,000		$	61,400
Average borrowings outstanding during the year (000)	$	22,225		$	45,165		$	55,269		$	61,022		$	63,725
Portfolio turnover		92	%		47	%		65	%		65	%		72	%
Asset coverage, end of year per $1,000	$	6,765		$	4,602		$	4,371		$	5,306		$	4,315

1	Based on average shares outstanding.
2	Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

See Notes to Financial Statements.
56	ANNUAL REPORT	FEBRUARY 28, 2010

Financial Highlights BlackRock Senior High Income Fund, Inc. (ARK)

	Year Ended February 28,						Year Ended February 29, 2008			Year Ended February 28,
	2010			2009						2007			2006
Per Share Operating Performance
Net asset value, beginning of year	$	2.54		$	5.04		$	6.17		$	6.00		$	6.28
Net investment income1		0.36			0.41			0.54			0.57			0.55
Net realized and unrealized gain (loss)		1.31			(2.43	)		(1.11	)		0.16			(0.27	)
Net increase (decrease) from investment operations		1.67			(2.02	)		(0.57	)		0.73			0.28
Dividends and distributions from:
Net investment income		(0.30	)		(0.43	)		(0.56	)		(0.56	)		(0.56	)
Tax return of capital		—			(0.05	)		—			—			—
Total dividends and distributions		(0.30	)		(0.48	)		(0.56	)		(0.56	)		(0.56	)
Net asset value, end of year	$	3.91		$	2.54		$	5.04		$	6.17		$	6.00
Market price, end of year	$	3.94		$	2.21		$	4.91		$	6.53		$	5.88
Total Investment Return2
Based on net asset value		68.90	%		(42.15	)%		(9.76	)%		12.82	%		5.07	%
Based on market price		95.61	%		(48.33	)%		(16.94	)%		21.84	%		4.13	%
Ratios to Average Net Assets
Total expenses		1.13	%		2.24	%		2.70	%		3.03	%		2.39	%
Total expenses after fees waived		1.13	%		2.24	%		2.70	%		3.03	%		2.39	%
Total expenses after fees waived and excluding interest expense		0.93	%		1.05	%		0.86	%		0.90	%		0.91	%
Net investment income		10.70	%		9.96	%		9.16	%		9.42	%		9.23	%
Supplemental Data
Net assets, end of year (000)	$	221,173		$	143,643		$	284,692		$	347,449		$	335,690
Borrowings outstanding, end of year (000)	$	43,000		$	47,000		$	91,500		$	132,000		$	141,700
Average borrowings outstanding during the year (000)	$	29,978		$	79,422		$	109,978		$	131,575		$	128,461
Portfolio turnover		80	%		49	%		48	%		62	%		48	%
Asset coverage, end of year per $1,000	$	6,144		$	4,056		$	4,112		$	3,632		$	3,369

1	Based on average shares outstanding.
2	Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

See Notes to Financial Statements.
ANNUAL REPORT	FEBRUARY 28, 2010	57

Notes to Financial Statements

1. Organization and Significant Accounting Policies:

BlackRock Corporate High Yield Fund, Inc. (“COY”), BlackRock Corporate High Yield Fund III, Inc. (“CYE”), BlackRock Debt Strategies Fund, Inc. (“DSU”) and BlackRock Floating Rate Income Strategies Fund II, Inc. (“FRB”) (the “Funds” or individually as the “Fund”) are registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as diversified, closed-end management investment companies. BlackRock Senior High Income Fund, Inc. (“ARK”) is registered under the 1940 Act as a non-diversified, closed-end management investment company. Each of the Funds is organized as a Mary-land corporation. The Funds’ financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require the use of management accruals and estimates. Actual results may differ from these estimates. The Funds determine and make available for publication the net asset values of their Common Shares on a daily basis.

The following is a summary of significant accounting policies followed by the Funds:

Valuation: The Funds’ policy is to fair value their financial instruments at market value. The Funds value their bond investments on the basis of last available bid prices or current market quotations provided by dealers or pricing services selected under the supervision of each Fund’s Board of Directors (the “Board”). Floating rate loan interests are valued at the mean of the bid prices from one or more brokers or dealers as obtained from a pricing service. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrixes, market transactions in comparable investments, various relationships observed in the market between investments and calculated yield measures based on valuation technology commonly employed in the market for such investments. Asset-backed and mortgage-backed securities are valued by independent pricing services using models that consider estimated cash flows of each tranche of the security, establish a benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche. Swap agreements are valued utilizing quotes received daily by the Funds’ pricing service or through brokers, which are derived using daily swap curves and trades of underlying securities. Investments in open-end investment companies are valued at net asset value each business day. Short-term securities with remaining maturities of 60 days or less may be valued at amortized cost, which approximates fair value.

Securities and other assets and liabilities denominated in foreign currencies are translated into US dollars using exchange rates determined as of the close of business on the New York Stock Exchange (“NYSE”). Foreign currency exchange contracts are valued at the mid between the bid and ask prices and are determined as of the close of business on the NYSE. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available.

Equity investments traded on a recognized securities exchange or the NASDAQ Global Market System are valued at the last reported sale price that day or the NASDAQ official closing price, if applicable. For equity investments traded on more than one exchange, the last reported sale price on the exchange where the stock is primarily traded is used. Equity investments traded on a recognized exchange for which there were no sales on that day are valued at the last available bid (long positions) or ask (short positions) price. If no bid or ask price is available, the prior day’s price will be used; unless it is determined that such prior day’s price no longer reflects the fair value of the security.

Exchange-traded options are valued at the mean between the last bid and ask prices at the close of the options market in which the options trade. An exchange-traded option for which there is no mean price is valued at the last bid (long positions) or ask (short positions) price. If no bid or ask price is available, the prior day’s price will be used, unless it is determined that the prior day’s price no longer reflects the fair value of the option. Over-the-counter (“OTC”) options are valued by an independent pricing service using a mathematical model which incorporates a number of market data factors, such as the trades and prices of the underlying instruments.

In the event that application of these methods of valuation results in a price for an investment which is deemed not to be representative of the market value of such investment or is not available, the investment will be valued by a method approved by each Fund’s Board as reflecting fair value (“Fair Value Assets”). When determining the price for Fair Value Assets, the investment advisor and/or the sub-advisor seeks to determine the price that each Fund might reasonably expect to receive from the current sale of that asset in arm’s-length transaction. Fair value determinations shall be based upon all available factors that the investment advisor and/or sub-advisor deems relevant. The pricing of all Fair Value Assets is subsequently reported to the Board or a committee thereof.

Generally, trading in foreign instruments is substantially completed each day at various times prior to the close of business on the NYSE. Occasionally, events affecting the values of such instruments may occur between the foreign market close and the close of business on the NYSE that may not be reflected in the computation of the Fund’s net assets. If events (for example, a company announcement, market volatility or a natural disaster) occur during such periods that are expected to materially affect the value of such instruments, those instruments may be Fair Value Assets and be valued at their fair value, as determined in good faith by the Board or by the investment advisor using a pricing service and/or procedures approved by the Board.

Foreign Currency Transactions: Foreign currency amounts are translated into United States dollars on the following basis: (i) market value of investment securities, assets and liabilities at the current rate of exchange; and (ii) purchases and sales of investment securities, income and expenses at the rates

58 ANNUAL REPORT FEBRUARY 28, 2010

Notes to Financial Statements (continued)

of exchange prevailing on the respective dates of such transactions. The Funds report foreign currency related transactions as components of realized gain (loss) for financial reporting purposes, whereas such components are treated as ordinary income for federal income tax purposes.

Capital Trusts: These securities are typically issued by corporations, generally in the form of interest-bearing notes with preferred securities characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in subordinated debentures or similarly structured securities. The securities can be structured as either fixed or adjustable coupon securities that can have either a perpetual or stated maturity date. Dividends can be deferred without creating an event of default or acceleration, although maturity cannot take place unless all cumulative payment obligations have been met. The deferral of payments does not affect the purchase or sale of these securities in the open market. Payments on these securities are treated as interest rather than dividends for federal income tax purposes. These securities can have a rating that is slightly below that of the issuing company’s senior debt securities.

Preferred Stock: Certain Funds may invest in preferred stocks. Preferred stock has a preference over common stock in liquidation (and generally in receiving dividends as well) but is subordinated to the liabilities of the issuer in all respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element varies inversely with interest rates and perceived credit risk, while the market price of convertible preferred stock generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors. Preferred stock also may be subject to optional or mandatory redemption provisions.

Floating Rate Loans: The Funds may invest in floating rate loans, which are generally non-investment grade, made by banks, other financial institutions, and privately and publicly offered corporations. Floating rate loans are senior in the debt structure of a corporation. Floating rate loans generally pay interest at rates that are periodically determined by reference to a base lending rate plus a premium. The base lending rates are generally (i) the lending rate offered by one or more European banks, such as LIBOR (London Interbank Offered Rate), (ii) the prime rate offered by one or more US banks or (iii) the certificate of deposit rate. The Funds consider these investments to be investments in debt securities for purposes of their investment policies.

The Funds earn and/or pay facility and other fees on floating rate loans. Other fees earned/paid include commitment, amendment, consent and prepayment penalty fees. Facility, commitment and amendment fees are typically amortized over the term of the loan. Consent fees and various other fees are recorded as income. Prepayment penalty fees are recorded as realized gains. When a Fund buys a floating rate loan it may receive a facility fee and when it sells a floating rate loan it may pay a facility fee. On an ongoing basis, the Funds may receive a commitment fee based on the undrawn portion of the underlying line of credit portion of a floating rate loan. In certain circumstances, the Funds may receive a prepayment penalty fee upon the prepayment of a floating rate loan by a borrower. Other fees received by the Funds may include covenant waiver fees and covenant modification fees. The Funds may invest in multiple series or tranches of a loan. A different series or tranche may have varying terms and carry different associated risks.

Floating rate loans are usually freely callable at the issuer’s option. The Funds may invest in such loans in the form of participations in loans (“Participations”) and assignments of all or a portion of loans from third parties. Participations typically will result in the Funds having a contractual relationship only with the lender, not with the borrower. The Funds will have the right to receive payments of principal, interest and any fees to which it is entitled only from the lender selling the Participation and only upon receipt by the lender of the payments from the borrower.

In connection with purchasing Participations, the Funds generally will have no right to enforce compliance by the borrower with the terms of the loan agreement relating to the loans, nor any rights of offset against the borrower, and the Funds may not benefit directly from any collateral supporting the loan in which it has purchased the Participation.

As a result, the Funds will assume the credit risk of both the borrower and the lender that is selling the Participation. The Funds’ investments in loan participation interests involve the risk of insolvency of the financial intermediaries who are parties to the transactions. In the event of the insolvency of the lender selling the Participation, the Funds may be treated as a general creditor of the lender and may not benefit from any offset between the lender and the borrower.

Zero-Coupon Bonds: The Funds may invest in zero-coupon bonds, which are normally issued at a significant discount from face value and do not provide for periodic interest payments. Zero-coupon bonds may experience greater volatility in market value than similar maturity debt obligations which provide for regular interest payments.

Segregation and Collateralization: In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (“SEC”) require that each Fund either delivers collateral or segregates assets in connection with certain investments (e.g., swaps or foreign currency exchange contracts), or certain borrowings (e.g., floating rate loans), each Fund will, consistent with SEC rules and/or certain interpretive letters issued by the SEC, segregate collateral or designate on its books and records cash or other liquid securities having a market value at least equal to the amount that would otherwise be required to be physically segregated. Furthermore, based on requirements and agreements with certain exchanges and third party broker-dealers, each party has requirements to deliver/deposit securities as collateral for certain investments.

Investment Transactions and Investment Income: For financial reporting purposes, investment transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on investment transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Interest income is recognized on the accrual basis. The Funds amortize all premiums and discounts on debt securities.

ANNUAL REPORT FEBRUARY 28, 2010 59

Notes to Financial Statements (continued)

Dividends and Distributions: Dividends from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. If the total dividends and distributions made in any tax year exceeds net investment income and accumulated realized capital gains, a portion of the total distribution may be treated as a tax return of capital.

Income Taxes: It is each Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. Under the applicable foreign tax laws, a withholding tax may be imposed on interest, dividends and capital gains at various rates.

Each Fund files US federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on each Fund’s US federal tax returns remains open for each of the two years ended May 31, 2008, the period ended February 28, 2009 and the year ended February 28, 2010 for COY and CYE, and for each of the four years ended February 28, 2010 for DSU, FRB and ARK. The statutes of limitations on the Funds’ state and local tax returns may remain open for an additional year depending upon the jurisdiction.

Recent Accounting Standards: In June 2009, amended guidance was issued by the Financial Accounting Standards Board (“FASB”) for transfers of financial assets. This guidance is intended to improve the relevance, representational faithfulness and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. The amended guidance is effective for financial statements for fiscal years and interim periods beginning after November 15, 2009. Earlier application is prohibited. The recognition and measurement provisions of this guidance must be applied to transfers occurring on or after the effective date. Additionally, the enhanced disclosure provisions of the amended guidance should be applied to transfers that occurred both before and after the effective date of this guidance. The impact of this guidance on the Funds’ financial statements and disclosures, if any, is currently being assessed.

In January 2010, the FASB issued amended guidance to improve disclosure about fair value measurements which will require additional disclosures about transfers into and out of Levels 1 and 2 and separate disclosures about purchases, sales, issuances and settlements in the reconciliation for fair value measurements using significant unobservable inputs (Level 3). It also clarifies existing disclosure requirements relating to the levels of disaggregation for fair value measurement and inputs and valuation techniques used to measure fair value. The amended guidance is effective for financial statements for fiscal years and interim periods beginning after December 15, 2009 except for disclosures about purchases, sales, issuances and settlements in the rollforward of activity in Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010 and for interim periods within those fiscal years. The impact of this guidance on the Funds’ financial statements and disclosures is currently being assessed.

Deferred Compensation and BlackRock Closed-End Share Equivalent Investment Plan: Under the deferred compensation plan approved by each Fund’s Board, non-interested Directors (“Independent Directors”) may defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of other certain BlackRock Closed-End Funds selected by the Independent Directors. This has approximately the same economic effect for the Independent Directors as if the Independent Directors had invested the deferred amounts directly in other certain BlackRock Closed-End Funds.

The deferred compensation plan is not funded and obligations there under represent general unsecured claims against the general assets of each Fund. Each Fund may, however, elect to invest in common shares of other certain BlackRock Closed-End Funds selected by the Independent Directors in order to match its deferred compensation obligations. Investments to cover each Fund’s deferred compensation liability, if any, are included in other assets in the Statements of Assets and Liabilities. Dividends and distributions from the BlackRock Closed-End Funds investments under the plan are included in income — affiliated in the Statements of Operations.

Other: Expenses directly related to each Fund are charged to that Fund. Other operating expenses shared by several funds are pro rated among those funds on the basis of relative net assets or other appropriate methods. Each Fund has an arrangement with its custodian whereby fees may be reduced by credits earned on uninvested cash balances, which if applicable are shown as fees paid indirectly in the Statements of Operations. The custodians impose fees on overdrawn cash balances, which can be offset by accumulated credits earned or may result in additional custody charges.

2. Derivative Financial Instruments:

The Funds may engage in various portfolio investment strategies both to increase the returns of the Funds and to economically hedge, or protect, their exposure to certain risks, such as credit risk, equity risk and foreign currency exchange rate risk. Losses may arise if the value of the contract decreases due to an unfavorable change in the price of the underlying instrument or if the counterparty does not perform under the contract. The Funds may mitigate counterparty risk through master netting agreements included within an International Swap and Derivatives Association, Inc. (“ISDA”) Master Agreement between a Fund and each of its counterparties. The ISDA Master Agreement allows each Fund to offset with its counterparty certain derivative financial instrument’s payables and/or receivables with collateral held with each counterparty. The amount of collateral moved to/from applicable counterparties is based upon minimum transfer amounts of up to $500,000. To the extent amounts due to the Funds from their counterparties are not fully collateralized contractually or otherwise, the Funds bear the risk of loss from counterparty non-performance. See Note 1 “Segregation and Collateralization” for information with respect to collateral practices.

60 ANNUAL REPORT FEBRUARY 28, 2010

Notes to Financial Statements (continued)

The Funds’ maximum risk of loss from counterparty credit risk on OTC derivatives is generally the aggregate unrealized gain in excess of any collateral pledged by the counterparty to the Funds. For OTC options purchased, the Funds bear the risk of loss in the amount of the premiums paid and change in market value of the options should the counterparty not perform under the contracts. Certain ISDA Master Agreements allow counterparties to OTC derivatives to terminate derivative contracts prior to maturity in the event a Fund’s net assets decline by a stated percentage or a Fund fails to meet the terms of its ISDA Master Agreements, which would cause a Fund to accelerate payment of any net liability owed to the counterparty.

Foreign Currency Exchange Contracts: The Funds may enter into foreign currency exchange contracts as an economic hedge against either specific transactions or portfolio positions (foreign currency exchange rate risk). A foreign currency exchange contract is an agreement between two parties to buy and sell a currency at a set exchange rate on a future date. Foreign currency exchange contracts, when used by the Funds, help to manage the overall exposure to the currency backing some of the investments held by the Funds. The contract is marked-to-market daily and the change in market value is recorded by the Funds as an unrealized gain or loss. When the contract is closed, the Funds record a realized gain or loss equal to the difference between the value at the time it was opened and the value at the time it was closed. The use of foreign currency exchange contracts involves the risk that counterparties may not meet the terms of the agreement or unfavorable movements in the value of a foreign currency relative to the US dollar.

Options: The Funds may purchase and write call and put options to increase or decrease their exposure to underlying instruments (equity risk) and/or, in the case of options written, to generate gains from options premiums. A call option gives the purchaser of the option the right (but not the obligation) to buy, and obligates the seller to sell (when the option is exercised), the underlying instrument at the exercise price at any time or at a specified during the option period. A put option gives the holder the right to sell and obligates the writer to buy the underlying instrument at the exercise price at any time or at a specified time during the option period. When a Fund purchases (writes) an option, an amount equal to the premium paid (received) by a Fund is reflected as an asset (liability). The amount of the asset (liability) is subsequently marked-to-market to reflect the current market value of the option purchased (written). When an instrument is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the instrument acquired or deducted from (or added to) the proceeds of the instrument sold. When an option expires (or a Fund enters into a closing transaction), a Fund realizes a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premium received or paid). When a Fund writes a call option, such option is “covered,” meaning that a Fund holds the underlying instrument subject to being called by the option counterparty, or cash in an amount sufficient to cover the obligation. When a Fund writes a put option, such option is covered by cash in an amount sufficient to cover the obligation.

In purchasing and writing options, a Fund bears the risk of an unfavorable change in the value of the underlying instrument or the risk that a Fund may not be able to enter into a closing transaction due to an illiquid market. Exercise of an option written could result in a Fund purchasing or selling a security at a price different from the current market value. The Funds may execute transactions in both listed and OTC options.

Swaps: The Funds may enter into swap agreements, in which a Fund and a counterparty agree to make periodic net payments on a specified notional amount. These periodic payments received or made by the Funds are recorded in the Statements of Operations as realized gains or losses, respectively. Any upfront fees paid are recorded as assets and any upfront fees received are recorded as liabilities and amortized over the term of the swap. Swaps are marked-to-market daily and changes in value are recorded as unrealized appreciation (depreciation). When the swap is terminated, the Fund will record a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Fund’s basis in the contract, if any. Swap transactions involve, to varying degrees, elements of interest rate, credit and market risk in excess of the amounts recognized in the Statements of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of the contractual terms in the agreements, and that there may be unfavorable changes in interest rates and/or market values associated with these transactions.

• Credit default swaps —The Funds may enter into credit default swaps to manage its exposure to the market or certain sectors of the market, to reduce its risk exposure to defaults of corporate and/or sovereign issuers or to create exposure to corporate and/or sovereign issuers to which it is not otherwise exposed (credit risk). The Funds enter into credit default agreements to provide a measure of protection against the default of an issuer (as buyer protection) and/or gain credit exposure to an issuer to which it is not otherwise exposed (as seller of protection). The Funds may either buy or sell (write) credit default swaps on single-name issuers (corporate or sovereign) or traded indexes. Credit default swaps on single-name issuers are agreements in which the buyer pays fixed periodic payments to the seller in consideration for a guarantee from the seller to make a specific payment should a negative credit event take place (e.g., bankruptcy, failure to pay, obligation accelerators, repudiation, moratorium or restructuring). Credit default swaps on traded indexes are agreements in which the buyer pays fixed periodic payments to the seller in consideration for a guarantee from the seller to make a specific payment should a write-down, principal or interest shortfall or default of all or individual underlying securities included in the index occurs. As a buyer, if an underlying credit event occurs, a Fund will either receive from the seller an amount equal to the notional amount of the swap and deliver the referenced security or underlying securities comprising of an index or receive a net settlement of cash equal to the notional amount of the swap less the recovery value of the security or underlying securities comprising of an index. As a seller (writer), if an underlying credit event occurs, a Fund will either pay the buyer an amount equal to the notional amount of the swap and take delivery of the referenced security or underlying securities comprising of an index or pay a net settlement of cash equal to the notional amount of the swap less the recovery value of the security or underlying securities comprising of an index.

ANNUAL REPORT FEBRUARY 28, 2010 61

Notes to Financial Statements (continued)

Derivative Instruments Categorized by Risk Exposure:
Values of Derivative Instruments as of February 28, 2010
	Asset Derivatives
			COY		CYE		DSU		FRB		ARK
		Statements of Assets and Liabilities Location	Value
Foreign currency exchange contracts		Unrealized appreciation on foreign currency exchange contracts	$	1,401,730	$	1,456,164	$	1,642,856	$	523,805	$	2,836
Credit contracts		Unrealized appreciation on swaps		18,639		5,534		4,571		856		2,463
Equity contracts		Investments at value — unaffiliated*		3,230		3,610		—		2,090		—
Total			$	1,423,599	$	1,465,308	$	1,647,427	$	526,751	$	5,299

	Liability Derivatives
		COY		CYE		DSU		FRB		ARK
	Statements of Assets and Liabilities Location	Value
Foreign currency exchange contracts	Unrealized depreciation on foreign currency exchange contracts	$	25,617	$	19,428	$	63,523	$	42,902		—
Credit contracts	Unrealized depreciation on swaps		381,198		235,526		109,385		—	$	2,961
Total		$	406,815	$	254,954	$	172,908	$	42,902	$	2,961

* Includes options purchased at value as reported in the Schedules of Investments.

The Effect of Derivative Instruments on the Statements of Operations Year Ended February 28, 2010
Net Realized Loss from
	COY			CYE			DSU			FRB			ARK
Foreign currency exchange contracts:
Foreign currency transactions	$	(939,452	)	$	(1,036,418	)	$	(1,582,294	)	$	(1,017,395	)	$	(86,342	)
Credit contracts:
Swaps		(442,843	)		(173,346	)		(783,756	)		(499,772	)		(1,213,910	)
Total	$	(1,382,295	)	$	(1,209,764	)	$	(2,366,050	)	$	(1,517,167	)	$	(1,300,252	)

Net Change in Unrealized Appreciation/Depreciation on
	COY			CYE			DSU			FRB			ARK
Foreign currency exchange contracts:
Foreign currency transactions	$	1,089,186		$	1,132,841		$	1,277,428		$	230,943		$	(8,567	)
Credit contracts:
Swaps		2,936,980			3,295,592			(1,563,576	)		2,901,019			450,201
Equity contracts:
Options**		(24,225	)		(27,075	)		—			(15,675	)		—
Total	$	4,001,941		$	4,401,358		$	(286,148	)	$	3,116,287		$	441,634

** Options purchased are included in the net realized gain (loss) from investments and/or net change in unrealized appreciation/depreciation on investments.

For the year ended February 28, 2010, the average quarterly balance of outstanding derivative financial instruments was as follows:

	COY		CYE		DSU		FRB		ARK
Foreign currency exchange contracts:
Average number of contracts — US dollars purchased		7		7		5		5		1
Average number of contracts — US dollars sold		1		1		2		—		—
Average US dollar amounts purchased	$	17,557,487	$	18,471,539	$	21,622,225	$	10,443,770	$	629,657
Average US dollar amounts sold	$	631,838	$	517,322	$	961,936		373,865	$	—
Options purchased:
Average number of contracts		17		19		—		11		—
Average premium	$	16,622	$	18,578		—	$	10,756		—
Credit default swaps:
Average number of contracts — buy protection		15		14		8		3		5
Average number of contracts — sell protection		4		4		1		1		1
Average notional value — buy protection	$	8,603,375	$	6,640,063	$	9,248,750	$	2,862,500	$	6,380,000
Average notional value — sell protection	$	2,940,000	$	3,143,750	$	900,000	$	3,000,000	$	2,500,000

62 ANNUAL REPORT FEBRUARY 28, 2010

Notes to Financial Statements (continued)

3. Investment Advisory Agreement and Other Transactions with Affiliates:

The PNC Financial Services Group, Inc. (“PNC”), Bank of America Corporation (“BAC”) and Barclays Bank PLC (“Barclays”) are the largest stockholders of BlackRock, Inc. (“BlackRock”). Due to the ownership structure, PNC is an affiliate for 1940 Act purposes, but BAC and Barclays are not.

Each Fund entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Manager”), the Funds’ investment advisor, an indirect, wholly owned subsidiary of BlackRock, to provide investment advisory and administration services.

The Manager is responsible for the management of each Fund’s portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of each Fund. For such services, each Fund pays the Manager a monthly fee at the following annual rates of the average daily value of each Fund’s net assets, plus the proceeds of any outstanding borrowings used for leverage:

COY	0.50	%
CYE	0.60	%
DSU	0.60	%
FRB	0.75	%
ARK	0.50	%

The Manager has entered into a separate sub-advisory agreement with BlackRock Financial Management, Inc. (“BFM”), an affiliate of the Manager, under which the Manager pays BFM for services it provides, a monthly fee that is a percentage of the investment advisory fees paid by each Fund to the Manager.

The Manager has voluntarily agreed to waive its advisory fee by the amount of investment advisory fees each Fund pays to the Manager indirectly through its investment in affiliated money market funds; however the Manager does not waive its advisory fees by the amount of investment advisory fees through its investment in other affiliated investment companies. This amount is included in fees waived by advisor in the Statements of Operations.

For the year ended February 28, 2010, each Fund reimbursed the Manager for certain accounting services, which are included in accounting services in the Statements of Operations. The reimbursements were as follows:

	Accounting Services
COY	$	4,692
CYE	$	5,011
DSU	$	8,993
FRB	$	3,165
ARK	$	4,150

Certain officers and/or directors of the Funds are officers and/or directors of BlackRock or its affiliates. The Funds reimburse the Manager for compensation paid to the Funds’ Chief Compliance Officer.

4. Investments:

Purchases and sales of investments (including paydowns and excluding short-term securities) for the year ended February 28, 2010 were as follows:

	Purchases		Sales
COY	$	227,515,827	$	199,766,176
CYE	$	254,846,090	$	228,524,797
DSU	$	356,383,963	$	353,648,473
FRB	$	143,515,779	$	133,540,214
ARK	$	184,776,600	$	174,109,625

5. Commitments:

The Funds may invest in floating rate loans. In connection with these investments, the Funds may also enter into unfunded corporate loans (“commitments”). Commitments may obligate the Funds to furnish temporary financing to a borrower until permanent financing can be arranged. In connection with these commitments, each Fund earns a commitment fee, typically set as a percentage of the commitment amount. Such fee income, which is classified in the Statements of Operations as facility and other fees, is recognized ratably over the commitment period. As of February 28, 2010, the Funds had the following unfunded loan commitments:

COY

Borrower	Unfunded Commitment		Value of Underlying Loans
Delphi	$	34,721	$	30,555
Delphi	$	351,679	$	304,202

CYE

Borrower	Unfunded Commitment		Value of Underlying Loans
Delphi	$	77,772	$	68,439
Delphi	$	787,716	$	681,375
New Vision	$	19,029	$	19,124

ANNUAL REPORT FEBRUARY 28, 2010 63

Notes to Financial Statements (continued)

FRB

Borrower	Unfunded Commitment		Value of Underlying Loans
Vought Aircraft	$	370,370	$	352,778
Delphi	$	13,789	$	12,135
Delphi	$	139,666	$	120,811
Cloverhill	$	214,286	$	218,362

6. Borrowings:

The Funds were previously party to revolving credit and security agreements (“Citicorp Agreement”) pursuant to a commercial paper asset securitization program with Citicorp North America, Inc. (“Citicorp”), where Citicorp acted as agent for certain backstop lenders and asset securitization conduits, as lenders (the “Lenders”). Under the Citicorp Agreement, the conduits funded advances to each Fund through the issuance of highly rated commercial paper. Each Fund had granted a security interest in substantially all of its assets to, and in favor of, the Lenders as security for its obligations to the Lenders. The interest rate on each Fund’s borrowings was based on the interest rate carried by the commercial paper plus a program fee. In addition, each Fund paid a liquidity fee to the secondary backstop lenders and the agent. Under the Citicorp Agreement, the Funds were subject to certain conditions and covenants, which included among other things limitations on asset declines over prescribed time periods. The commitment amounts under the Citicorp Agreement were as follows:

	Commitment Amount
COY	$	81,000,000
CYE	$	85,000,000
DSU	$	174,000,000
FRB	$	58,000,000
ARK	$	91,000,000

On March 5, 2009, the Funds terminated the Citicorp Agreement and entered into a senior committed secured, 364-day revolving line of credit and a separate security agreement (the “SSB Agreement”) with State Street Bank and Trust Company (“SSB”). The SSB Agreement had the same commitment amounts as the renegotiated amounts under the Citigroup Agreement except for DSU which was lowered to $135,000,000. The Funds have granted a security interest in substantially all of its assets to SSB. Advances are made by SSB to the Funds, at the Funds’ option of (a) the higher of (i) 1.0% above the Fed Effective Rate and (ii) 1.0% above the Overnight LIBOR or (b) 1.0% above 7-day, 30-day, 60-day or 90-day LIBOR. In addition, the Funds pay a facility fee and a commitment fee based upon SSB’s total commitment to the Funds. The fees associated with each of the agreements are included in the Statements of Operations as borrowing costs. Advances to the Funds as of February 28, 2010 are shown in the Statements of Assets and Liabilities as loan payable. The SSB Agreement was renewed for 364 days under substantially the same terms effective March 4, 2010. The SSB Agreement allows for the following maximum commitment amounts:

	Commitment Amount
COY	$	90,000,000
CYE	$	95,000,000
DSU	$	150,000,000
FRB	$	58,000,000
ARK	$	91,000,000

The Funds may not declare dividends or make other distributions on shares or purchase any such shares if, at the time of the declaration, distribution or purchase, asset coverage with respect to the outstanding short-term borrowings is less than 300%.

For the year ended February 28, 2010, the daily weighted average interest rates under the revolving credit agreement were as follows:

	Daily Weighted Average Interest Rate
COY		1.24	%
CYE		1.24	%
DSU		1.25	%
FRB		1.25	%
ARK		1.25	%

7. Income Tax Information:

Reclassifications: Accounting principles generally accepted in the United States of America require that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share. The following permanent differences as of February 28, 2010 attributable to the accounting for swap agreements, amortization methods on fixed income securities, the classification of settlement proceeds, the classification of investments, foreign currency transactions, securities in default, income recognized from pass-through entities and the expiration of capital loss carryforwards were reclassified to the following accounts:

	COY			CYE			DSU			FRB			ARK
Paid-in capital	$	(33,478,307	)	$	(52,918,036	)	$	(90,564,493	)		—		$	(54,958,583	)
Undistributed (distributions in excess of) net investment income	$	(631,658	)	$	(706,443	)	$	(869,137	)	$	(567,513	)	$	18,739
Accumulated net realized loss	$	34,109,965		$	53,624,479		$	91,433,630		$	567,513		$	54,939,844

64 ANNUAL REPORT FEBRUARY 28, 2010

Notes to Financial Statements (continued)

The tax character of distributions paid during the fiscal year ended February 28, 2010, the fiscal year ended February 28, 2009, the fiscal period June 1, 2008 through February 28, 2009 and the fiscal year ended May 31, 2008 was as follows:

	COY		CYE		DSU		FRB		ARK
Ordinary income
2/28/2010	$	25,342,365	$	25,189,541	$	41,936,207	$	10,283,447	$	16,952,851
2/28/2009		—		—	$	65,857,392	$	16,017,675	$	24,063,310
6/1/2008 – 2/28/2009	$	19,134,959	$	20,800,925		—		—		—
5/31/2008	$	26,113,293	$	28,767,885		—		—		—
Tax return of capital
2/28/2010		—		—	$	926,392	$	825,748		—
2/28/2009		—		—		—		—	$	3,089,535
Total distributions
2/28/2010	$	25,342,365	$	25,189,541	$	42,862,599	$	11,109,195	$	16,952,851
2/28/2009		—		—	$	65,857,392	$	16,017,675	$	27,152,845
6/1/2008 – 2/28/2009	$	19,134,959	$	20,800,925		—		—		—
5/31/2008	$	26,113,293	$	28,767,885		—		—		—

As of February 28, 2010, the tax components of accumulated net losses were as follows:

	COY			CYE			DSU			FRB			ARK
Undistributed ordinary income	$	3,393,209		$	2,568,952			—			—		$	3,815,249
Capital loss carryforwards		(144,672,950	)		(180,360,026	)	$	(352,201,100	)	$	(52,519,160	)		(147,904,491	)
Net unrealized losses*		(9,812,218	)		(11,911,988	)		(110,766,761	)		(8,713,512	)		(36,413,975	)
Total	$	(151,091,959	)	$	(189,703,062	)	$	(462,967,861	)	$	(61,232,672	)	$	(180,503,217	)

* The differences between book-basis and tax-basis net unrealized losses were attributable primarily to the tax deferral of losses on wash sales, amortization methods for premiums and discounts on fixed income securities, the accrual of income on securities in default, the realization for tax purposes of unrealized gains/(losses) on certain foreign currency contracts, the deferral of post-October capital losses for tax purposes, the timing and recognition of partnership income, the accounting for swap agreements, book/tax difference on investments in passive foreign investment companies, the classification of settlement proceeds, the deferral of compensation to directors, the classification of investments and other temporary differences.

As of February 28, 2010, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates:

Expires February 28,	COY		CYE		DSU		FRB		ARK
2011	$	77,885,783	$	119,513,437	$	85,285,305		—	$	30,706,546
2012		6,647,369		1,938,881		17,223,475		—		22,345,071
2013		—		—		21,126,025		—		—
2014		—		—		20,233,987		203,838		4,906,362
2015		—		—		3,578,574		1,315,945		1,585,622
2016		454,146		363,401		—		—		—
2017		23,362,415		24,709,530		56,690,782		12,168,927		27,675,242
2018		36,323,237		33,834,777		148,062,952		38,830,450		60,685,648
Total	$	144,672,950	$	180,360,026	$	352,201,100	$	52,519,160	$	147,904,491

8. Market and Credit Risk:

In the normal course of business, the Funds invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (credit risk). The value of securities held by the Funds may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Funds; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to credit risk, the Funds may be exposed to counterparty risk, or the risk that an entity with which the Funds have unsettled or open transactions may default. Financial assets, which potentially expose the Funds to credit and counterparty risks, consist principally of investments and cash due from counterparties. The extent of the Funds’ exposure to credit and counterparty risks with respect to these financial assets is generally approximated by their value recorded in the Funds’ Statements of Assets and Liabilities, less any collateral held by the Funds.

9. Capital Share Transactions:

Each Fund is authorized to issue 200 million shares, par value $0.10 per share, all of which were initially classified as Common Shares. At February 28, 2010, the shares owned by affiliates of the Manager of FRB were 8,553. The Board is authorized, however, to classify and reclassify any unissued shares without approval of shareholders.

ANNUAL REPORT FEBRUARY 28, 2010 65

Notes to Financial Statements (concluded)

Shares issued and outstanding during the year ended February 28, 2010 and the period ended February 28, 2009 increased by the following amounts as a result of dividend reinvestments:

	Year Ended February 28, 2010	Period Ended February 28, 2009
COY	132,418	—
CYE	16,969	—
DSU	422,001	499,727
FRB	19,658	—
ARK	33,391	75,664

Shares issued and outstanding remained constant for COY and CYE for the year ended May 31, 2008.

10. Subsequent Events:

Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were issued and the following items were noted:

The Funds paid a net investment income dividend on March 31, 2010 to shareholders of record on March 15, 2010 as follows:

	Common Dividend Per Share
COY	$	0.051
CYE	$	0.050
DSU	$	0.031
FRB	$	0.075
ARK	$	0.025

66 ANNUAL REPORT FEBRUARY 28, 2010

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of BlackRock Corporate High Yield Fund, Inc., BlackRock Corporate High Yield Fund III, Inc., BlackRock Debt Strategies Fund, Inc., BlackRock Floating Rate Income Strategies Fund II, Inc. and BlackRock Senior High Income Fund, Inc. (collectively the “Funds”):

We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of BlackRock Corporate High Yield Fund, Inc. and BlackRock Corporate High Yield Fund III, Inc. as of February 28, 2010, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for the year ended February 28, 2010, for the period June 1, 2008 to February 28, 2009 and for the year ended May 31, 2008, and the financial highlights for each of the periods presented. We have also audited the accompanying statements of assets and liabilities, including the schedules of investments, of BlackRock Debt Strategies Fund, Inc., BlackRock Floating Rate Income Strategies Fund II, Inc., and BlackRock Senior High Income Fund, Inc., as of February 28, 2010, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of the securities owned as of February 28, 2010, by correspondence with the custodian, brokers and agent banks; where replies were not received from brokers or agent banks, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of BlackRock Corporate High Yield Fund, Inc. and BlackRock Corporate High Yield Fund III, Inc. as of February 28, 2010, the results of their operations and their cash flows for the year then ended, the changes in their net assets for the year ended February 28, 2010, for the period June 1, 2008 to February 28, 2009 and for the year ended May 31, 2008, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. Additionally, in our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of BlackRock Debt Strategies Fund, Inc., BlackRock Floating Rate Income Strategies Fund II, Inc., and BlackRock Senior High Income Fund, Inc. as of February 28, 2010, the results of their operations and their cash flows for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP
Princeton, New Jersey
April 29, 2010

Important Tax Information (Unaudited)

The following information is provided with respect to the ordinary income distributions paid by the Funds for the taxable year ended February 28, 2010:

		COY		CYE		DSU		FRB		ARK
Interest-Related Dividends for Non-U.S. Residents(1) Month Paid:	March 2009	79.23	%	81.85	%	79.16	%	78.20	%	85.87	%
	April 2009	79.23	%	81.85	%	77.51	%	82.59	%	85.87	%
	May 2009	83.91	%	81.85	%	77.51	%	84.35	%	85.87	%
	June 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	July 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	August 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	September 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	October 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	November 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	December 2009	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	January 2010	88.36	%	81.85	%	77.51	%	84.35	%	85.87	%
	February 2010	55.19	%	70.65	%	—		—		72.57	%

⁽¹⁾ Represents the portion of the taxable ordinary income dividends eligible for exemption from U.S. withholding tax for nonresident aliens and foreign corporations.

ANNUAL REPORT FEBRUARY 28, 2010 67

Automatic Dividend Reinvestment Plans

How the Plan Works — The Funds offer a Dividend Reinvestment Plan (the “Plan”) under which income and capital gains dividends paid by each Fund are automatically reinvested in additional Common Shares of each Fund. The Plan is administered on behalf of the shareholders by BNY Mellon Share-owner Services for DSU and ARK and Computershare Trust Company, N.A. for COY, CYE and FRB (individually, the “Plan Agent” or together, the “Plan Agents”). Under the Plan, whenever the Funds declare a dividend, participants in the Plan will receive the equivalent in shares of Common Shares of the Fund. The Plan Agents will acquire the shares for the participant’s account either (i) through receipt of additional unissued but authorized shares of the Fund (“newly issued shares”) or (ii) by purchase of outstanding Common Shares on the open market on the New York Stock Exchange or elsewhere. If, on the dividend payment date, a Fund’s net asset value per share is equal to or less than the market price per share plus estimated brokerage commissions (a condition often referred to as a “market premium”), the Plan Agents will invest the dividend amount in newly issued shares. If a Fund’s net asset value per share is greater than the market price per share (a condition often referred to as a “market discount”), the Plan Agents will invest the dividend amount by purchasing on the open market additional shares. If the Plan Agents are unable to invest the full dividend amount in open market purchases, or if the market discount shifts to a market premium during the purchase period, the Plan Agents will invest any uninvested portion in newly issued shares. The shares acquired are credited to each shareholder’s account. The amount credited is determined by dividing the dollar amount of the dividend by either (i) when the shares are newly issued, the net asset value per share on the date the shares are issued or (ii) when shares are purchased in the open market, the average purchase price per share.

Participation in the Plan — Participation in the Plan is automatic, that is, a shareholder is automatically enrolled in the Plan when he or she purchases Common Shares of a Fund unless the shareholder specifically elects not to participate in the Plan. Shareholders who elect not to participate will receive all dividend distributions in cash. Shareholders who do not wish to participate in the Plan, must advise their Plan Agent in writing (at the address set forth below) that they elect not to participate in the Plan. Participation in the Plan is completely voluntary and may be terminated or resumed at any time without penalty by writing to the Plan Agent.

Benefits of the Plan — The Plan provides an easy, convenient way for shareholders to make additional, regular investments in a Fund. The Plan promotes a long-term strategy of investing at a lower cost. All shares acquired pursuant to the Plan receive voting rights. In addition, if the market price plus commissions of a Fund’s shares is above the net asset value, participants in the Plan will receive shares of the Fund for less than they could otherwise purchase them and with a cash value greater than the value of any cash distribution they would have received. However, there may not be enough shares available in the market to make distributions in shares at prices below the net asset value. Also, since the Funds do not redeem shares, the price on resale may be more or less than the net asset value.

Plan Fees — There are no enrollment fees or brokerage fees for participating in the Plan. The Plan Agents’ service fees for handling the reinvestment of distributions are paid for by each Fund. However, brokerage commissions may be incurred when a Fund purchase shares on the open market and shareholders will pay a pro rata share of any such commissions.

Tax Implications — The automatic reinvestment of dividends and distributions will not relieve participants of any federal, state or local income tax that may be payable (or required to be withheld) on such dividends. Therefore, income and capital gains may still be realized even though shareholders do not receive cash. The value of shares acquired pursuant to the Plan will generally be excluded from gross income to the extent that the cash amount reinvested would be excluded from gross income. If, when a Fund’s shares are trading at a market premium, a Fund issues shares pursuant to the Plan that have a greater fair market value than the amount of cash reinvested, it is possible that all or a portion of the discount from the market value (which may not exceed 5% of the fair market value of a Fund’s shares) could be viewed as a taxable distribution. If the discount is viewed as a taxable distribution, it is also possible that the taxable character of this discount would be allocable to all the shareholders, including shareholders who do not participate in the Plan. Thus, shareholders who do not participate in the Plan might be required to report as ordinary income a portion of their distributions equal to their allocable share of the discount.

Contact Information — All correspondence concerning the Plan, including any questions about the Plan, should be directed to the Plan Agent at the following addresses: Shareholders of BlackRock Debt Strategies Fund, Inc. and BlackRock Senior High Income Fund, Inc. should contact BNY Mellon Shareowner Services, P.0. Box 358035, Pittsburgh, PA 15252-8035, Telephone: (866) 216-0242 and shareholders of BlackRock Corporate High Yield Fund, Inc., BlackRock Corporate High Yield Fund III, Inc. and BlackRock Floating Rate Income Strategies Fund II, Inc. should contact Computershare Trust Company, N.A., P.O. Box 43078, Providence, RI 02940-3078, Telephone: (800) 699-1BFM or overnight correspondence should be directed to the Plan Agent at 250 Royall Street, Canton, MA 02021.

68 ANNUAL REPORT FEBRUARY 28, 2010

Officers and Directors

Name, Address and Year of Birth	Position(s) Held with Funds	Length of Time Served as a Director2	Principal Occupation(s) During Past Five Years	Number of BlackRock- Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen	Public Directorships
Non-Interested Directors1
Richard E. Cavanagh 55 East 52nd Street New York, NY 10055 1946	Chairman of the Board and Director	Since 2007	Trustee, Aircraft Finance Trust from 1999 to 2009; Director, The Guardian Life Insurance Company of America since 1998; Trustee, Educational Testing Service since 1997; Senior Advisor since 2008 and Director since 1996, The Fremont Group; Adjunct Lecturer, Harvard University since 2007; Formerly President and Chief Executive Officer of The Conference Board, Inc. (global business research organization) from 1995 to 2007.	99 RICs consisting of 97 Portfolios	Arch Chemical (chemical and allied products)
Karen P. Robards 55 East 52nd Street New York, NY 10055 1950	Vice Chair of the Board, Chair of the Audit Committee and Director	Since 2007	Partner of Robards & Company, LLC (financial advisory firm) since 1987; Co-founder and Director of the Cooke Center for Learning and Development (a not-for-profit organization) since 1987; Director of Enable Medical Corp. from 1996 to 2005; Investment banker at Morgan Stanley from 1976 to 1987.	99 RICs consisting of 97 Portfolios	AtriCure, Inc. (medical devices); Care Investment Trust, Inc. (health care real estate investment trust)
G. Nicholas Beckwith, III 55 East 52nd Street New York, NY 10055 1945	Director	Since 2007	Chairman and Chief Executive Officer, Arch Street Management, LLC (Beckwith Family Foundation) and various Beckwith property companies since 2005; Chairman of the Board of Directors, University of Pittsburgh Medical Center since 2002; Director, Shady Side Hospital Foundation since 1977; Director, Beckwith Institute for Innovation In Patient Care since 1991; Member, Advisory Council on Biology and Medicine, Brown University since 2002; Trustee, Claude Worthington Benedum Foundation (charitable foundation) since 1989; Trustee, Chatham University since 1981; Trustee, University of Pittsburgh since 2002; Emeritus Trustee, Shady Side Academy since 1977; Chairman and Manager, Penn West Industrial Trucks LLC (sales, rental and servicing of material handling equipment) from 2005 to 2007; Chairman, President and Chief Executive Officer, Beckwith Machinery Company (sales, rental and servicing of construction equipment) from 1985 to 2005; Director, National Retail Properties (REIT) from 2006 to 2008.	99 RICs consisting of 97 Portfolios	None
Frank J. Fabozzi 55 East 52nd Street New York, NY 10055 1948	Director and Member of the Audit Committee	Since 2007	Consultant/Editor of The Journal of Portfolio Management since 2006; Professor in the Practice of Finance and Becton Fellow, Yale University, School of Management, since 2006; Adjunct Professor of Finance and Becton Fellow, Yale University from 1994 to 2006.	99 RICs consisting of 97 Portfolios	None
Kathleen F. Feldstein 55 East 52nd Street New York, NY 10055 1941	Director	Since 2007	President of Economics Studies, Inc. (private economic consulting firm) since 1987; Chair, Board of Trustees, McLean Hospital from 2000 to 2008 and Trustee Emeritus thereof since 2008; Member of the Board of Partners Community Healthcare, Inc. from 2005 to 2009; Member of the Corporation of Partners HealthCare since 1995; Member of the Corporation of Sherrill House (health care) since 1990; Trustee, Museum of Fine Arts, Boston since 1992; Member of the Visiting Committee to the Harvard University Art Museum since 2003; Director, Catholic Charities of Boston since 2009.	99 RICs consisting of 97 Portfolios	The McClatchy Company (publishing)
James T. Flynn 55 East 52nd Street New York, NY 10055 1939	Director and Member of the Audit Committee	Since 2007	Chief Financial Officer of JPMorgan & Co., Inc. from 1990 to 1995.	99 RICs consisting of 97 Portfolios	None
Jerrold B. Harris 55 East 52nd Street New York, NY 10055 1942	Director	Since 2007	Trustee, Ursinus College since 2000; Director, Troemner LLC (scientific equipment) since 2000.	99 RICs consisting of 97 Portfolios	BlackRock Kelso Capital Corp.

ANNUAL REPORT FEBRUARY 28, 2010 69

Officers and Directors (continued)

Name, Address and Year of Birth	Position(s) Held with Funds	Length of Time Served as a Director2	Principal Occupation(s) During Past Five Years	Number of BlackRock- Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen	Public Directorships
Non-Interested Directors1 (concluded)
R. Glenn Hubbard 55 East 52nd Street New York, NY 10055 1958	Director	Since 2007	Dean, Columbia Business School since 2004; Columbia faculty member since 1988; Co-Director, Columbia Business School’s Entrepreneurship Program from 1997 to 2004; Visiting Professor, John F. Kennedy School of Government at Harvard University and the Harvard Business School since 1985 and at the University of Chicago since 1994; Chairman, US Council of Economic Advisers under the President of the United States from 2001 to 2003.	99 RICs consisting of 97 Portfolios	ADP (data and information services); KKR Financial Corporation (finance); Duke Realty (real estate); Metropolitan Life Insurance Company (insurance); Information Services Group (media/technology)
W. Carl Kester 55 East 52nd Street New York, NY 10055 1951	Director and Member of the Audit Committee	Since 2007	George Fisher Baker Jr. Professor of Business Administration, Harvard Business School; Deputy Dean for Academic Affairs since 2006; Unit Head, Finance, Harvard Business School from 2005 to 2006; Senior Associate Dean and Chairman of the MBA Program of Harvard Business School from 1999 to 2005; Member of the faculty of Harvard Business School since 1981; Independent Consultant since 1978.	99 RICs consisting of 97 Portfolios	None

1

Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.

2

Date shown is the earliest date a person has served for the Fund covered by this annual report. Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. (“BlackRock”) in September 2006, the various legacy MLIM and legacy BlackRock Fund boards were realigned and consolidated into three new Fund boards in 2007. As a result, although the chart shows directors as joining the Funds’ board in 2007, each director first became a member of the board of directors of other legacy MLIM or legacy BlackRock Funds as follows: G. Nicholas Beckwith, III since 1999; Richard E. Cavanagh since 1994; Kent Dixon since 1988; Frank J. Fabozzi since 1988; Kathleen F. Feldstein since 2005; James T. Flynn since 1996; Jerrold B. Harris since 1999; R. Glenn Hubbard since 2004; W. Carl Kester since 1998 and Karen P. Robards since 1998.

Interested Directors3
Richard S. Davis 55 East 52nd Street New York, NY 10055 1945	Director	Since 2007	Managing Director, BlackRock, Inc. since 2005; Chief Executive Officer, State Street Research & Management Company from 2000 to 2005; Chairman of the Board of Trustees, State Street Research Mutual Funds from 2000 to 2005; Chairman, SSR Realty from 2000 to 2004.	170 RICs consisting of 298 Portfolios	None
Henry Gabbay 55 East 52nd Street New York, NY 10055 1947	Director	Since 2007	Consultant, BlackRock, Inc. from 2007 to 2008; Managing Director, BlackRock, Inc. from 1989 to 2007; Chief Administrative Officer, BlackRock Advisors, LLC from 1998 to 2007; President of BlackRock Funds and BlackRock Bond Allocation Target Shares from 2005 to 2007; Treasurer of certain closed-end funds in the BlackRock fund complex from 1989 to 2006.	170 RICs consisting of 298 Portfolios	None

³ Mr. Davis is an “interested person,” as defined in the Investment Company Act of 1940, of the Funds based on his position with BlackRock, Inc. and its affiliates. Mr. Gabbay is an “interested person” of the Funds based on his former positions with BlackRock, Inc. and its affiliates as well as his ownership of BlackRock, Inc. and The PNC Financial Services Group, Inc. securities. Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.

70 ANNUAL REPORT FEBRUARY 28, 2010

Officers and Directors (concluded)

Name, Address and Year of Birth	Position(s) Held with Funds	Length of Time Served	Principal Occupation(s) During Past Five Years
Funds Officers1
Anne Ackerley 55 East 52nd Street New York, NY 10055 1962	President and Chief Executive Officer	Since 2009	Managing Director of BlackRock, Inc. since 2000; Vice President of the BlackRock-advised Funds from 2007 to 2009; Chief Operating Officer of BlackRock’s Global Client Group (GCG) since 2009; Chief Operating Officer of BlackRock’s U.S. Retail Group from 2006 to 2009; Head of BlackRock’s Mutual Fund Group from 2000 to 2006.
Brendan Kyne 55 East 52nd Street New York, NY 10055 1977	Vice President	Since 2009	Managing Director of BlackRock, Inc. since 2010; Director of BlackRock, Inc. from 2008 to 2009; Head of Product Development and Management for BlackRock’s U.S. Retail Group since 2009, Co-head thereof from 2007 to 2009; Vice President of BlackRock, Inc. from 2005 to 2008.
Neal Andrews 55 East 52nd Street New York, NY 10055 1966	Chief Financial Officer	Since 2007	Managing Director of BlackRock, Inc. since 2006; Formerly Senior Vice President and Line of Business Head of Fund Accounting and Administration at PNC Global Investment Servicing (U.S.) Inc. (formerly PFPC Inc.) from 1992 to 2006.
Jay Fife 55 East 52nd Street New York, NY 10055 1970	Treasurer	Since 2007	Managing Director of BlackRock, Inc. since 2007 and Director in 2006; Formerly Assistant Treasurer of the MLIM/FAM-advised Funds from 2005 to 2006; Director of MLIM Fund Services Group from 2001 to 2006.
Brian Kindelan 55 East 52nd Street New York, NY 10055 1959	Chief Compliance Officer	Since 2007	Chief Compliance Officer of the BlackRock-advised Funds since 2007; Managing Director and Senior Counsel of BlackRock, Inc. since 2005; Formerly Director and Senior Counsel of BlackRock Advisors, Inc. from 2001 to 2004.
Howard Surloff 55 East 52nd Street New York, NY 10055 1965	Secretary	Since 2007	Managing Director of BlackRock, Inc. and General Counsel of U.S. Funds at BlackRock, Inc. since 2006; Formerly General Counsel (U.S.) of Goldman Sachs Asset Management, L.P. from 1993 to 2006.

¹ Officers of the Funds serve at the pleasure of the Board of Directors.

Investment Advisor

BlackRock Advisors, LLC

Wilmington, DE 19809

Sub-Advisor

BlackRock Financial Management, Inc.

New York, NY 10055

Custodians

JPMorgan Chase Bank, N.A.²

New York, NY 10017

State Street Bank and Trust Company³

Boston, MA 02111

The Bank of New York Mellon⁴

New York, NY 10286

Transfer Agents

BNY Mellon Shareowner Services⁴

Jersey City, NJ 07310

Computershare Trust Company, N.A.^2,3

Providence, RI 02940

Accounting Agent

State Street Bank and Trust Company

Princeton, NJ 08540

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Princeton, NJ 08540

Legal Counsel

Skadden, Arps, Slate, Meagher & Flom LLP

New York, NY 10036

Address of the Funds

100 Bellevue Parkway

Wilmington, DE 19809

2	For COY.
3	For CYE and FRB.
4	For DSU and ARK.

Effective January 1, 2010, Kent Dixon, a Director of the Funds, retired.

Effective March 31, 2010, G. Nicholas Beckwith, III, a Director of the Funds, resigned.

The Funds’ Board of Directors wishes both Mr. Dixon and Mr. Beckwith well.

ANNUAL REPORT FEBRUARY 28, 2010 71

Additional Information

Dividend Policy

The Funds’ dividend policy is to distribute all or a portion of their net investment income to their shareholders on a monthly basis. In order to provide shareholders with a more stable level of dividend distributions, the Funds may at times pay out less than the entire amount of net investment income earned in any particular month and may at times in any particular month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the dividends paid by the Funds for any particular month may be more or less than the amount of net investment income earned by the Funds during such month. The Funds’ current accumulated but undistributed net investment income, if any, is disclosed in the Statements of Assets and Liabilities, which comprises part of the financial information included in this report.

Fund Certification

The Funds listed for trading on the New York Stock Exchange (“NYSE”) have filed with the NYSE their annual chief executive officer certification regarding compliance with the NYSE’s listing standards. Each Fund filed with the Securities and Exchange Commission (“SEC”) the certification of their chief executive officer and chief financial officer required by section 302 of the Sarbanes-Oxley Act.

General Information

The Funds do not make available copies of their Statements of Additional Information because the Funds’ shares are not continuously offered, which means that the Statement of Additional Information of each Fund has not been updated after completion of the respective Fund’s offerings and the information contained in each Fund’s Statement of Additional Information may have become outdated.

During the period, there were no material changes in the Funds’ investment objectives or policies or to the Funds’ charter or by-laws that were not approved by the shareholders or in the principal risk factors associated with investment in the Funds. There have been no changes in the persons who are primarily responsible for the day-to-day management of the Funds’ portfolio.

Quarterly performance, semi-annual and annual reports and other information regarding the Funds may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Funds and does not, and is not intended to, incorporate BlackRock’s website into this report.

Electronic Delivery

Electronic copies of most financial reports are available on the Funds’ website or shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual reports by enrolling in the Funds’ electronic delivery program.

Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:

Please contact your financial advisor to enroll. Please note that not all investment advisors, banks or brokerages may offer this service.

Householding

The Funds will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call (800) 441-7762.

Availability of Quarterly Schedule of Investments

Each Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling (202) 551-8090. Each Fund’s Forms N-Q may also be obtained upon request and without charge by calling (800) 441-7762.

Availability of Proxy Voting Policies and Procedures

A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling (800) 441-7762; (2) at www.blackrock.com; and (3) on the SEC’s website at http://www.sec.gov.

Availability of Proxy Voting Record

Information about how the Funds voted proxies relating to securities held in the Funds’ portfolios during the most recent 12-month period ended June 30 is available upon request and without charge (1) at www.blackrock.com or by calling (800) 441-7762 and (2) on the SEC’s website at http://www.sec.gov.

72 ANNUAL REPORT FEBRUARY 28, 2010

Additional Information (continued)

Section 19(a) Notices

These amounts and sources of distributions reported are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources of the amounts for tax reporting purposes will depend upon each Fund’s investment experience during the year and may be subject to changes based on the tax regulations. The Funds will send you a Form 1099-DIV each calendar year that will tell you how to report these distributions for federal income tax purposes.

February 28, 2010
	Total Cumulative Distributions for the Fiscal Year								% Breakdown of the Total Cumulative Distributions for the Fiscal Year
	Net Investment Income		Net Realized Capital Gains		Return of Capital		Total Per Common Share		Net Investment Income			Net Realized Capital Gains			Return of Capital			Total Per Common Share
DSU	$	0.39040		—	$	0.00860	$	0.39900		98	%		0	%		2	%		100	%
FRB	$	0.97983		—	$	0.07827	$	1.05810		93	%		0	%		7	%		100	%
ARK	$	0.30000		—		—	$	0.30000		100	%		0	%		0	%		100	%

Each Fund estimates that it has distributed more than the amount of earned income and net realized gains; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the shareholder’s investment in a Fund is returned to the shareholder. A return of capital does not necessarily reflect a Fund’s investment performance and should not be confused with ‘yield’ or ‘income.’

ANNUAL REPORT FEBRUARY 28, 2010 73

Additional Information (concluded)

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

74 ANNUAL REPORT FEBRUARY 28, 2010

This report is transmitted to shareholders only. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Funds have leveraged their Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of net asset value and market price of the Common Shares, and the risk that fluctuations in short-term interest rates may reduce the Common Shares’ yield. Statements and other information herein are as dated and are subject to change.

	#CEF1-5-2/10

Item 2 –	Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant’s principal executive officer, principal financial officer and principal accounting officer, or persons performing similar functions. During the period covered by this report, there have been no amendments to or waivers granted under the code of ethics. A copy of the code of ethics is available without charge at www.blackrock.com.
Item 3 –	Audit Committee Financial Expert – The registrant’s board of directors or trustees, as applicable (the “board of directors”) has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:
	Kent Dixon (retired effective December 31, 2009)
	Frank J. Fabozzi
	James T. Flynn
	W. Carl Kester
	Karen P. Robards
	The registrant’s board of directors has determined that W. Carl Kester and Karen P. Robards qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.
	Prof. Kester has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Prof. Kester has been involved in providing valuation and other financial consulting services to corporate clients since 1978. Prof. Kester’s financial consulting services present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant’s financial statements.
	Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been President of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.
	Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification.

Item 4 – Principal Accountant Fees and Services

	(a) Audit Fees		(b) Audit-Related Fees1		(c) Tax Fees2		(d) All Other Fees3
Entity Name	Current Fiscal Year End	Previous Fiscal Year End	Current Fiscal Year End	Previous Fiscal Year End	Current Fiscal Year End	Previous Fiscal Year End	Current Fiscal Year End	Previous Fiscal Year End
BlackRock Debt Strategies Fund, Inc.	$49,300	$49,300	$0	$0	$6,100	$6,100	$0	$1,028

1 The nature of the services include assurance and related services reasonably related to the performance of the audit of financial statements not included in Audit Fees.

2 The nature of the services include tax compliance, tax advice and tax planning.

3 The nature of the services include a review of compliance procedures and attestation thereto.

(e)(1) Audit Committee Pre-Approval Policies and Procedures:

The registrant’s audit committee (the “Committee”) has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the registrant’s affiliated service providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are a) consistent with the SEC’s auditor independence rules and b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operation or financial reporting of the registrant will only be deemed pre-approved provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 for all of the registrants the Committee oversees. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.

Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to one or more of its members the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g) Affiliates’ Aggregate Non-Audit Fees:

Entity Name	Current Fiscal Year End	Previous Fiscal Year End
BlackRock Debt Strategies Fund, Inc.	$16,877	$412,128

	(h) The registrant’s audit committee has considered and determined that the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any non-affiliated sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by the registrant’s investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
	Regulation S-X Rule 2-01(c)(7)(ii) – $10,777, 0%
Item 5 –	Audit Committee of Listed Registrants – The following individuals are members of the registrant’s separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):
	Kent Dixon (retired effective December 31, 2009)
	Frank J. Fabozzi
	James T. Flynn
	W. Carl Kester
	Karen P. Robards
Item 6 –	Investments
	(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form.
	(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.

Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – The board of directors has delegated the voting of proxies for the Fund securities to the Fund’s investment adviser (“Investment Adviser”) pursuant to the Investment Adviser’s proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies related to Fund securities in the best interests of the Fund and its stockholders. From time to time, a vote may present a conflict between the interests of the Fund’s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the Investment Adviser, on the other. In such event, provided that the Investment Adviser’s Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight Committee”) is aware of the real or potential conflict or material non-routine matter and if the Oversight Committee does not reasonably believe it is able to follow its general voting guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote impartially, the Oversight Committee may retain an independent fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s clients. If the Investment Adviser determines not to retain an independent fiduciary, or does not desire to follow the advice of such independent fiduciary, the Oversight Committee shall determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio Management Group and/or the Investment Adviser’s Legal and Compliance Department and concluding that the vote cast is in its client’s best interest notwithstanding the conflict. A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit 99.PROXYPOL. Information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, (i) at www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

Item 8 –

Portfolio Managers of Closed-End Management Investment Companies – as of February 28, 2010.

(a)(1)     The registrant is managed by a team of investment professionals comprised of Leland T. Hart, Managing Director at BlackRock, James E. Keenan, Managing Director at BlackRock and C. Adrian Marshall, Director at BlackRock. Messrs. Hart, Keenan and Marshall are the Fund’s co-portfolio managers and are responsible for the day-to-day management of the Fund’s portfolio and the selection of its investments. Messrs. Hart, Keenan and Marshall have been members of the Fund’s management team since 2009.

Portfolio Manager	Biography
Leland T. Hart	Managing Director of BlackRock, Inc. since 2009; Partner of R3 Capital Partners ("R3") in 2009; Managing Director of R3 from 2008 - 2009; Managing Director of Lehman Brothers from 2006 - 2008; Executive Director of Lehman Brothers from 2003 - 2006.
James E. Keenan	Managing Director of BlackRock, Inc. since 2008; Director of BlackRock, Inc. from 2004 – 2007. Head of the Leveraged Finance Portfolio team; senior high yield trader at Columbia Management from 2003 to 2004.
C. Adrian Marshall	Director of BlackRock, Inc. since 2007; Vice President of BlackRock, Inc. from 2004 - 2007.

(a)(2)     As of February 28, 2010:

	(ii) Number of Other Accounts Managed and Assets by Account Type			(iii) NumberofOtherAccountsand Assetsfor Which Advisory Fee is Performance-Based
(i) Name of Portfolio Manager	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts
Leland T. Hart	8	1	0	0	0	0
	$2.25 Billion	$39.1 Million	$0	$0	$0	$0
James E. Keenan	22	22	48	0	11	6
	$8.36 Billion	$7.22 Billion	$5.25 Billion	$0	$4.95 Billion	$714.5 Million
C. Adrian Marshall	8	16	5	0	10	0
	$2.25 Billion	$5.62 Billion	$620.1 Million	$0	$4.87 Billion	$0

(iv)     Potential Material Conflicts of Interest

BlackRock and its affiliates (collectively, herein “BlackRock”) has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio

managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Fund.  In addition, BlackRock, its affiliates and significant shareholders and any officer, director, stockholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund.  BlackRock, or any of its affiliates or significant shareholders, or any officer, director, stockholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities.  Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock or any of its affiliates or significant shareholders or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information.  Each portfolio manager also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a fund.  In this connection, it should be noted that Messrs. Keenan and Marshall currently manage certain accounts that are subject to performance fees.  In addition, Mr. Keenan assists in managing certain hedge funds and may be entitled to receive a portion of any incentive fees earned on such funds and a portion of such incentive fees may be voluntarily or involuntarily deferred.  Additional portfolio managers may in the future manage other such accounts or funds and may be entitled to receive incentive fees.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly.  When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties.  BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment.  To this end, BlackRock has adopted a policy that is intended to ensure that investment opportunities are allocated fairly and equitably among client accounts over time.  This policy also seeks to achieve reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base.

(a)(3)     As of February 28, 2010:

Portfolio Manager Compensation Overview

BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career path emphasis at all levels reflect the value senior management places on key resources. Compensation may include a variety of components and may vary from year to year based on a number of factors. The principal components of compensation include a base salary, a performance-based discretionary bonus, participation in various benefits programs and one or more of the incentive compensation programs established by BlackRock such as its Long-Term Retention and Incentive Plan and Restricted Stock Program.

Base compensation.Generally, portfolio managers receive base compensation based on their seniority and/or their position with the firm. Senior portfolio managers who perform additional management functions within the portfolio management group or within BlackRock may receive additional compensation for serving in these other capacities.

Discretionary Incentive Compensation

Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to predetermined benchmarks, and the individual’s seniority, role within the portfolio management team, teamwork and contribution to the overall performance of these portfolios and BlackRock.  In most cases, including for the portfolio managers of the Fund, these benchmarks are the same as the benchmark or benchmarks against which the performance of the Fund or other accounts managed by the portfolio managers are measured. BlackRock’s Chief Investment Officers determine the benchmarks against which the performance of funds and other accounts managed by each portfolio manager is compared and the period of time over which performance is evaluated.  With respect to the portfolio managers, such benchmarks for the Fund include the following:

Portfolio Manager	Applicable Benchmarks
Leland T. Hart	A combination of market-based indices (e.g., CSFB Leveraged Loan Index, CSFB High Yield II Value Index), certain customized indices and certain fund industry peer groups.
James Keenan	A combination of market-based indices (e.g., The Barclays Capital U.S. Corporate High Yield 2% Issuer CappedTM Index), certain customized indices and certain fund industry peer groups.
C. Adrian Marshall	A combination of market-based indices (e.g., CSFB Leveraged Loan Index, CSFB High Yield II Value Index), certain customized indices and certain fund industry peer groups.

BlackRock’s Chief Investment Officers make a subjective determination with respect to the portfolio managers’compensation based on the performance of the funds and other accounts managed by each portfolio manager relative to the various benchmarks noted above.  Performance is measured on both a pre-tax and after-tax basis over various time periods including 1, 3, 5 and 10-year periods, as applicable. 

Distribution of Discretionary Incentive Compensation

Discretionary incentive compensation is distributed to portfolio managers in a combination of cash and BlackRock, Inc. restricted stock units which vest ratably over a number of years. The BlackRock, Inc. restricted stock units, if properly vested, will be settled in BlackRock, Inc. common stock. Typically, the cash bonus, when combined with base salary, represents more than 60% of total compensation for the portfolio managers. Paying a portion of annual bonuses in stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods.

Long-Term Retention and Incentive Plan (“LTIP”) — From time to time long-term incentive equity awards are granted to certain key employees to aid in retention, align their interests with long-term shareholder interests and motivate performance.  Equity awards are generally granted in the form of BlackRock, Inc. restricted stock units that, once vested, settle in BlackRock, Inc. common stock. Messrs. Keenan and Marshall have each received awards under the LTIP.

Deferred Compensation Program — A portion of the compensation paid to eligible BlackRock employees may be voluntarily deferred into an account that tracks the performance of certain of the firm’s investment products. Each participant in the deferred compensation program is permitted to allocate his deferred amounts among the various investment options. Messrs. Keenan, and Marshall have each participated in the deferred compensation program.

Other compensation benefits. In addition to base compensation and discretionary incentive compensation, portfolio managers may be eligible to receive or participate in one or more of the following:

Incentive Savings Plans — BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 6% of eligible pay contributed to the plan capped at $4,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation.  The RSP offers a range of investment options, including registered investment companies managed by the firm. BlackRock contributions follow the investment direction set by participants for their own contributions or, absent employee investment direction, are invested into a balanced portfolio.  The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date.  Annual participation in the ESPP is limited to the purchase of 1,000 shares or a dollar value of $25,000.  Each portfolio manager is eligible to participate in these plans.

(a)(4)     Beneficial Ownership of Securities – February 28, 2010.

Portfolio Manager	Dollar Range of Equity Securities Beneficially Owned
Leland T. Hart	None
James Keenan	None
C. Adrian Marshall	None

Item 9 –

Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable due to no such purchases during the period covered by this report.

Item 10 –

Submission of Matters to a Vote of Security Holders – The registrant’s Nominating and Governance Committee will consider nominees to the board of directors recommended by shareholders when a vacancy becomes available. Shareholders who wish to recommend a nominee should send nominations that include biographical information and set forth the qualifications of the proposed nominee to the registrant’s Secretary. There have been no material changes to these procedures.

Item 11 –	Controls and Procedures
11(a) –	The registrant’s principal executive and principal financial officers or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13(a)-15(b) under the Securities Exchange Act of 1934, as amended.
11(b) –	There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12 –	Exhibits attached hereto
12(a)(1) –	Code of Ethics – See Item 2
12(a)(2) –	Certifications – Attached hereto
12(a)(3) –	Not Applicable
12(b) –	Certifications – Attached hereto

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BlackRock Debt Strategies Fund, Inc.
By:	/s/ Anne F. Ackerley
	Anne F. Ackerley
	Chief Executive Officer of
	BlackRock Debt Strategies Fund, Inc.
Date: April 28, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By:	/s/ Anne F. Ackerley
	Anne F. Ackerley
	Chief Executive Officer (principal executive officer) of
	BlackRock Debt Strategies Fund, Inc.
Date: April 28, 2010
By:	/s/ Neal J. Andrews
	Neal J. Andrews
	Chief Financial Officer (principal financial officer) of
	BlackRock Debt Strategies Fund, Inc.
Date: April 28, 2010

EX-99.CERT

EX-99. CERT

CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE 1940 ACT AND SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Anne F. Ackerley, Chief Executive Officer (principal executive officer) of BlackRock Debt Strategies Fund, Inc., certify that:

1. I have reviewed this report on Form N-CSR of BlackRock Debt Strategies Fund, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: April 28, 2010

/s/ Anne F. Ackerley

Anne F. Ackerley

Chief Executive Officer (principal executive officer) of

BlackRock Debt Strategies Fund, Inc.

EX-99. CERT

CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE 1940 ACT AND SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Neal J. Andrews, Chief Financial Officer (principal financial officer) of BlackRock Debt Strategies Fund, Inc., certify that:

1. I have reviewed this report on Form N-CSR of BlackRock Debt Strategies Fund, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: April 28, 2010

/s/ Neal J. Andrews

Neal J. Andrews

Chief Financial Officer (principal financial officer) of

BlackRock Debt Strategies Fund, Inc.

EX-99.906CERT

Exhibit 99.1350CERT

Certification Pursuant to Rule 30a-2(b) under the 1940 Act and

Section 906 of the Sarbanes Oxley Act

Pursuant to 18 U.S.C. § 1350, the undersigned officer of BlackRock Debt Strategies Fund, Inc. (the “Registrant”), hereby certifies, to the best of her knowledge, that the Registrant’s Report on Form N-CSR for the period ended February 28, 2010, (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: April 28, 2010

/s/ Anne F. Ackerley

Anne F. Ackerley

Chief Executive Officer (principal executive officer) of

BlackRock Debt Strategies Fund, Inc.

Pursuant to 18 U.S.C. § 1350, the undersigned officer of BlackRock Debt Strategies Fund, Inc. (the “Registrant”), hereby certifies, to the best of his knowledge, that the Registrant’s Report on Form N-CSR for the period ended February 28, 2010, (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: April 28, 2010

/s/ Neal J. Andrews

Neal J. Andrews

Chief Financial Officer (principal financial officer) of

BlackRock Debt Strategies Fund, Inc.

This certification is being furnished pursuant to Rule 30a-2(b) under the Investment Company Act of 1940, as amended, and 18 U.S.C. Section 1350 and is not being filed as part of the Form N-CSR with the Securities and Exchange Commission.

EX-99.PROXYPOL

Global corporate
governance &
engagement principles

December 2009

Table of contents

1. INTRODUCTION TO BLACKROCK 1

2. PHILOSOPHY ON CORPORATE GOVERNACE 1

3. CORPORATE GOVERNANCE, ENGAGEMENT AND VOTING 2

Boards and directors 3

Accounting and audit-related issues 5

Capital structure, merger, asset sales and other special transactions 6

Remuneration and benefits 6

Social, ethical, and environmental issues 7

General corporate governance matters 8

4. BLACKROCK’S OVERSIGHT OF ITS CORPORATE GOVERNANCE ACTIVITIES 8

Oversight 8

Vote execution 9

Conflicts management 10

Voting guidelines 12

Reporting 12

BLACKROCK

GLOBAL CORPORATE GOVERNANCE & ENGAGEMENT
PRINCIPLES

1. INTRODUCTION TO BLACKROCK

BlackRock is the world’s preeminent asset management firm and a premier provider of global investment management, risk management and advisory services to institutional and individual clients around the world. With more than $3.3 trillion¹ in assets under management, BlackRock offers a wide range of investment strategies and product structures to meet clients’ needs, including individual and institutional separate accounts, mutual funds, and other pooled investment vehicles and the industry-leading iShares exchange traded funds. Through BlackRock Solutions®, we offer risk management, strategic advisory and enterprise investment system services to a broad base of clients with portfolios totaling approximately US$7.25 trillion.¹

2. PHILOSOPHY ON CORPORATE GOVERNACE

BlackRock’s corporate governance program is focused on protecting and enhancing the economic value of the companies in which it invests on behalf of clients. We do this through engagement with boards and management of investee companies and, for those clients who have given us authority, through voting at shareholder meetings.

We believe that there are certain fundamental rights attached to share ownership: companies should be accountable to shareholders for the use of their money, companies and their boards should be structured with appropriate checks and balances to ensure that they operate in shareholders’ interests, effective voting rights are central to the rights of ownership and there should be one vote for one share. Key elements of shareholder protection include protection against excessive dilution, the election of directors and the appointment of auditors. Specifically, shareholders should have the right to elect, remove and nominate directors and to amend the corporate charter or by-laws. Shareholders should also be able to vote on matters that are material to the protection of their investment including but not limited to changes to the purpose of the business, the distribution of income and the capital structure. In order to exercise these rights in their own best interests, we believe shareholders have the right to sufficient and timely information to be able to take an informed view of the performance of the company and management.

__________________________

1 Data is as of September 30, 2009, is subject to change, and is based on a pro forma estimate of assets under management at BlackRock, Inc. and Barclays Global Investors, N.A.

BlackRock global corporate governance & engagement principles

Our focus is on the board of directors, as the agents of shareholders, who should set the company’s strategic aims within a framework of prudent and effective controls which enables risk to be assessed and managed. The board should provide direction and leadership to the management and oversee their performance. Our starting position is to be supportive of boards in their oversight efforts on our behalf and the items of business they put to a shareholder vote at shareholder meetings. Votes against or withheld from resolutions proposed by the board are a signal that we are concerned that the directors or management have either not acted in the interests of shareholders or have not responded adequately to shareholder concerns communicated to it regarding the strategy or management of a company.

These principles set out our approach to engaging with companies, provide guidance on our position on the key aspects of corporate governance and outline how these might be reflected in our voting decisions. Corporate governance practices vary internationally and our expectations in relation to individual companies are based on the legal and regulatory framework of each market. However, we do believe that there are some overarching principles of corporate governance that apply globally. We assess voting matters on a case-by-case basis and in light of a company’s unique circumstances. We are interested to understand from the company’s reporting the approach taken, particularly where it is different from the usual market practice and to understand how it benefits shareholders.

BlackRock also believes that shareholders are responsible for exercising oversight of, and promoting due care in, the stewardship of their investment in a company. These ownership responsibilities include, in our view, engaging in certain circumstances with management or board members on corporate governance matters, voting proxies in the best long-term economic interests of shareholders and engaging with regulatory bodies to ensure a sound policy framework consistent with promoting long-term shareholder value creation. Institutional shareholders also have responsibilities to their clients to have appropriate resources and oversight structures. BlackRock’s approach to oversight in relation to its corporate governance activities is set out in section 4.

3. CORPORATE GOVERNANCE, ENGAGEMENT AND VOTING

We recognize that accepted standards of corporate governance differ between markets but we believe that there are sufficient common threads globally to identify an overarching set of principles. The primary objective of our corporate governance activities is the protection and enhancement of our

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BlackRock global corporate governance & engagement principles

clients’ investments in public corporations. Thus, these principles focus on practices and structures that we consider to be supportive of long-term value creation. We discuss below the principles under six key themes. In our regional and market-specific voting guidelines we explain how these principles inform our voting decisions in relation to specific resolutions that may appear on the agenda of a shareholder meeting in the relevant market.

The six key themes are:

• Boards and directors

• Accounting and audit-related issues

• Capital structure, mergers, asset sales and other special transactions

• Remuneration and benefits

• Social, ethical and environmental issues

• General corporate governance matters

At a minimum we would expect companies to observe the accepted corporate governance standard in their domestic market or to explain why doing so is not in the interests of shareholders. Where company reporting and disclosure is inadequate or the approach taken is inconsistent with our view of what is in the best interests of shareholders we will engage with the company and/or use our vote to encourage better practice. In making voting decisions, we take into account research from external proxy advisors, other internal and external research and academic articles, information published by the company or provided through engagement and the views of our equity portfolio managers.

BlackRock views engagement as an important activity; engagement provides BlackRock with the opportunity to improve our understanding of investee companies and their governance structures, so that our voting decisions may be better informed. Engagement also allows us to share our philosophy and approach to investment and corporate governance with issuers to enhance their understanding of our objectives. There are a range of approaches we may take in engaging companies depending on the nature of the issue under consideration, the company and the market.

Boards and directors

The performance of the board is critical to the economic success of the company and to the protection of shareholders’ interests. Board members serve as agents of shareholders in overseeing the operation and strategic direction of the company. For this reason, BlackRock focuses on directors in many of its engagements and sees the election of directors as one of its most important responsibilities in the proxy voting context.

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BlackRock global corporate governance & engagement principles

We expect the board of directors to promote and protect shareholder interests by:

• establishing an appropriate corporate governance structure;

• overseeing and supporting management in setting strategy;

• ensuring the integrity of financial statements;

• making decisions regarding mergers, acquisitions and disposals;

• establishing appropriate executive compensation structures; and

• addressing business issues including social, ethical and environmental issues when they have the potential to materially impact company reputation and performance.

There should be clear definitions of the role of the board, the sub-committees of the board and the senior management such that the responsibilities of each are well understood and accepted. Companies should report publicly the approach taken to governance (including in relation to board structure) and why this approach is in the interest of shareholders. We will engage with the appropriate directors where we have concerns about the performance of the board or the company, the broad strategy of the company or the performance of individual board members. Concerns about individual board directors may include their membership on the board of a different company where that board has performed poorly and failed to protect shareholder interests.

BlackRock believes that directors should stand for re-election on a regular basis. We assess directors nominated for election or re-election in the context of the composition of the board as a whole. There should be detailed disclosure of the relevant credentials of the individual directors in order that shareholders can assess the caliber of an individual nominee. We expect there to be a sufficient number of independent directors on the board to ensure the protection of the interests of all shareholders. Common impediments to independence include but are not limited to:

• current employment at the company or a subsidiary;

• former employment within the past several years as an executive of the company;

• providing substantial professional services to the company and/or members of the company’s management;

• having had a substantial business relationship in the past three years;

• having, or representing a shareholder with, a substantial shareholding in the company;

• being an immediate family member of any of the aforementioned; and

• interlocking directorships.

BlackRock believes that the operation of the board is enhanced when there is a clearly independent, senior non-executive director to lead it. Where the chairman is also the CEO or is otherwise not

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BlackRock global corporate governance & engagement principles

independent the company should have an independent lead director. The role of this director is to enhance the effectiveness of the independent members of the board through shaping the agenda, ensuring adequate information is provided to the board and encouraging independent participation in board deliberations. The lead independent board director should be available to shareholders where they have concerns that they wish to discuss.

To ensure that the board remains effective, regular reviews of board performance should be carried out and assessments made of gaps in skills or experience amongst the members. BlackRock believes it is beneficial for new directors to be brought onto the board periodically to refresh the group’s thinking and to ensure both continuity and adequate succession planning. We believe that directors are in the best position to assess the optimal size for the board but we would be concerned if a board seemed too small to have an appropriate balance of directors or too large to be effective.

There are matters for which the board has responsibility that may involve a conflict of interest for executives or for affiliated directors. BlackRock believes that shareholders’ interests are best served when the independent members of the board form a sub-committee to deal with such matters. In many markets, these sub-committees of the board specialize in audit, director nominations and compensation matters. An ad hoc committee might also be formed to decide on a special transaction, particularly one with a related party.

Accounting and audit-related issues

BlackRock recognizes the critical importance of financial statements which provide a complete and accurate picture of a company’s financial condition. We will hold the members of the audit committee or equivalent responsible for overseeing the management of the audit function. We take particular note of cases involving significant financial restatements or ad hoc notifications of material financial weakness.

The integrity of financial statements depends on the auditor being free of any impediments to being an effective check on management. To that end, we believe it is important that auditors are, and are seen to be, independent. Where the audit firm provides services to the company in addition to the audit the fees earned should be disclosed and explained. Audit committees should also have in place a procedure for assuring annually the independence of the auditor.

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BlackRock global corporate governance & engagement principles

Capital structure, merger, asset sales and other special transactions

The capital structure of a company is critical to its owners, the shareholders, as it impacts the value of their investment and the priority of their interest in the company relative to that of other equity or debt investors. Pre-emption rights are a key protection for shareholders against the dilution of their interests.

In assessing mergers, asset sales or other special transactions, BlackRock’s primary consideration is the long-term economic interests of shareholders. Boards proposing a transaction need to clearly explain the economic and strategic rationale behind it. We will review the transaction to determine the degree to which the proposed transaction enhances long term shareholder value. We would prefer that such transactions have the unanimous support of the board and have been negotiated at arm’s length. We may seek reassurance from the board that executive and/or board members’ financial interests in a given transaction have not affected their ability to place shareholders’ interests before their own. Where the transaction does involve related parties we would expect the recommendation to support it to come from the independent directors and would prefer only non-conflicted shareholders to vote on the proposal.

BlackRock believes that shareholders have a right to dispose of company shares in the open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’ ability to sell their shares are contrary to basic property rights. Such mechanisms can serve to protect and entrench interests other than those of the shareholders. We believe that shareholders are broadly capable of making decisions in their own best interests. We would expect any so-called ‘shareholder rights plans’ being proposed by a board to be subject to shareholder approval on introduction and periodically thereafter for continuation.

Remuneration and benefits

BlackRock expects a company’s board of directors to put in place a compensation structure that incentivizes and rewards executives appropriately and is aligned with shareholder interests. We would expect the compensation committee to take into account the specific circumstances of the company and the key individuals the board is trying to incentivize. We encourage companies to ensure that their compensation packages incorporate appropriate and challenging performance conditions consistent with corporate strategy and market practice. We use third party research, in addition to our own analysis, to evaluate existing and proposed compensation structures. We hold members of the compensation committee or equivalent accountable for poor compensation practices or structures.

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BlackRock global corporate governance & engagement principles

BlackRock believes that there should be a clear link between variable pay and company performance as reflected in returns to shareholders. We are not supportive of one-off or special bonuses unrelated to company or individual performance. We support incentive plans that payout rewards earned over multiple and extended time periods. We believe consideration should be given to building claw back provisions into incentive plans such that executives would be required to repay rewards where they were not justified by actual performance. Compensation committees should guard against contractual arrangements that would entitle executives to material compensation for early termination of their contract. Finally, pension contributions should be reasonable in light of market practice.

Outside directors should be compensated in a manner that does not risk compromising their independence or aligning their interests too closely with those of the management, whom they are charged with overseeing.

Social, ethical, and environmental issues

Our fiduciary duty to clients is to protect and enhance their economic interest in the companies in which we invest on their behalf. It is within this context that we undertake our corporate governance activities. We believe that well-managed companies will deal effectively with the social, ethical and environmental (SEE) aspects of their businesses.

BlackRock expects companies to identify and report on the key, business-specific SEE risks and opportunities and to explain how these are managed. This explanation should make clear how the approach taken by the company best serves the interests of shareholders and protects and enhances the long-term economic value of the company. The key performance indicators in relation to SEE matters should also be disclosed and performance against them discussed, along with any peer group benchmarking and verification processes in place. This helps shareholders assess how well management are dealing with the SEE aspects of the business. Any global standards adopted should also be disclosed and discussed in this context.

We may vote against the election of directors where we have concerns that a company might not be dealing with SEE issues appropriately. Sometimes we may reflect such concerns by supporting a shareholder proposal on the issue, where there seems to be either a significant potential threat or realized harm to shareholders’ interests caused by poor management of SEE matters. In deciding our course of action, we will assess whether the company has already taken sufficient steps to address the concern and whether there is a clear and substantial economic disadvantage to the company if the issue is not addressed.

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BlackRock global corporate governance & engagement principles

More commonly, given that these are often not voting issues, we will engage directly with the board or management. The trigger for engagement on a particular SEE concern is our assessment that there is potential for material economic ramifications for shareholders.

We do not see it as our role to make social, ethical or political judgments on behalf of clients. We expect investee companies to comply, as a minimum, with the laws and regulations of the jurisdictions in which they operate. They should explain how they manage situations where such laws or regulations are contradictory or ambiguous.

General corporate governance matters

BlackRock believes that shareholders have a right to timely and detailed information on the financial performance and situation of the companies in which they invest. In addition, companies should also publish information on the governance structures in place and the rights of shareholders to influence these. The reporting and disclosure provided by companies forms the basis on which shareholders can assess the extent to which the economic interests of shareholders have been protected and enhanced and the quality of the board’s oversight of management. BlackRock considers as fundamental, shareholders’ rights to vote, including on changes to governance mechanisms, to submit proposals to the shareholders’ meeting and to call special meetings of shareholders.

4. BLACKROCK'S OVERSIGHT OF ITS CORPORATE GOVERNANCE ACTIVITIES

Oversight

BlackRock holds itself to a very high standard in its corporate governance activities, including in relation to executing proxy votes. The Global Corporate Governance Group reports in to the equity business and is considered an investment function. BlackRock maintains regional oversight committees (“corporate governance committees”) for the Americas, Europe, Asia ex-Japan, Japan, and Australia/New Zealand, consisting of senior BlackRock investment professionals. All the regional committees report up to the Global Corporate Governance Committee which is composed of the Chair and Vice-Chair of each regional committee. The committees review and approve amendments to the BlackRock Guidelines and grant authority to the Global Head of Corporate Governance (“Global Head”), a dedicated BlackRock employee without sales responsibilities, to vote in accordance with the Guidelines. The Global Head leads a team of dedicated BlackRock employees without sales responsibilities (“Corporate Governance Group”) to carry out engagement, voting and vote operations in a manner consistent with the committees’ mandate. The Corporate Governance Group engages companies in conjunction with the portfolio managers in discussions of significant governance issues,

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BlackRock global corporate governance & engagement principles

conducts research on corporate governance issues and participates in industry discussions to keep abreast of the field of corporate governance. The Corporate Governance Group, or vendors overseen by the Corporate Governance Group, also monitor upcoming proxy votes, execute proxy votes and maintain records of votes cast. The Corporate Governance Group may refer complicated or particularly controversial matters or discussions to the appropriate investors and/or regional Corporate Governance Committees for their review, discussion and guidance prior to making a voting decision. The Committees likewise retain the authority to, among other things, deliberate or otherwise act directly on specific proxies as they deem appropriate. BlackRock's Equity Investment Portfolio Oversight Committee (EIPOC) oversees certain aspects of the Global Corporate Governance Committee and the corporate governance function’s activities.

Vote execution

BlackRock carefully considers proxies submitted to funds and other fiduciary accounts (“Funds”) for which it has voting authority. BlackRock votes (or refrains from voting) proxies for each Fund for which it has voting authority based on BlackRock’s evaluation of the best long-term economic interests of shareholders, in the exercise of its independent business judgment, and without regard to the relationship of the issuer of the proxy (or any dissident shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates.

When exercising voting rights, BlackRock will normally vote on specific proxy issues in accordance with its proxy voting guidelines (“Guidelines”) for the relevant market. The Guidelines are reviewed regularly and are amended consistent with changes in the local market practice, as developments in corporate governance occur, or as otherwise deemed advisable by BlackRock’s Corporate Governance Committees. The committees may, in the exercise of their business judgment, conclude that the Guidelines do not cover the specific matter upon which a proxy vote is requested or that an exception to the Guidelines would be in the best long-term economic interests of BlackRock’s clients. In certain markets, proxy voting involves logistical issues which can affect BlackRock’s ability to vote such proxies, as well as the desirability of voting such proxies. These issues include but are not limited to: (i) untimely notice of shareholder meetings; (ii) restrictions on a foreigner’s ability to exercise votes; (iii) requirements to vote proxies in person; (iv) “shareblocking” (requirements that investors who exercise their voting rights surrender the right to dispose of their holdings for some specified period in proximity to the shareholder meeting); (v) potential difficulties in translating the proxy; and (vi) requirements to provide local agents with unrestricted powers of attorney to facilitate voting instructions. We are not supportive of impediments to the exercise of voting rights such as shareblocking or overly burdensome administrative requirements.

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BlackRock global corporate governance & engagement principles

As a consequence, BlackRock votes proxies in these markets only on a “best-efforts” basis. In addition, the Corporate Governance Committees may determine that it is generally in the best interests of BlackRock clients not to vote proxies of companies in certain countries if the committee determines that the costs (including but not limited to opportunity costs associated with shareblocking constraints) associated with exercising a vote are expected to outweigh the benefit the client will derive by voting on the issuer’s proposal.

While it is expected that BlackRock, as a fiduciary, will generally seek to vote proxies over which BlackRock exercises voting authority in a uniform manner for all BlackRock clients, the relevant Corporate Governance Committee, in conjunction with the portfolio manager of an account, may determine that the specific circumstances of such an account require that such account’s proxies be voted differently due to such account’s investment objective or other factors that differentiate it from other accounts. In addition, BlackRock believes portfolio managers may from time to time legitimately reach differing but equally valid views, as fiduciaries for their funds and the client assets in those funds, on how best to maximize economic value in respect of a particular investment. Accordingly, portfolio managers retain full discretion to vote the shares in the funds they manage based on their analysis of the economic impact of a particular ballot item.

Conflicts management

BlackRock maintains policies and procedures that are designed to prevent undue influence on BlackRock's proxy voting activity that might stem from any relationship between the issuer of a proxy (or any dissident shareholder) and BlackRock, BlackRock's affiliates, a Fund or a Fund's affiliates. Some of the steps BlackRock has taken to prevent conflicts include, but are not limited to:

i) BlackRock has adopted a proxy voting oversight structure whereby the Corporate Governance Committees oversee the voting decisions and other activities of the Global Corporate Governance Group, and particularly its activities with respect to voting in the relevant region of each committee’s jurisdiction.

ii) The Corporate Governance Committees have adopted Guidelines for each region, which set forth the firm’s views with respect to certain corporate governance and other issues that typically arise in the proxy voting context. The Corporate Governance Committee reserves the right to review voting decisions at any time and to make voting decisions as necessary to ensure the independence and integrity of the voting process. In addition, the Committee receives periodic reports regarding the specific votes cast by the Corporate Governance Group and regular updates on material process issues, procedural changes and other matters of concern to the Committee.

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BlackRock global corporate governance & engagement principles

iii)

BlackRock’s Global Corporate Governance Committee oversees the Global Head, the Corporate Governance Group and the Corporate Governance Committees. The Global Corporate Governance Committee conducts a review, at least annually, of the proxy voting process to ensure compliance with BlackRock’s risk policies and procedures.

iv)

BlackRock maintains a reporting structure that separates the Global Head and Corporate Governance Group from employees with sales responsibilities.  In addition, BlackRock maintains procedures to ensure that all engagements with corporate issuers or dissident shareholders are managed consistently and without regard to BlackRock’s relationship with the issuer of the proxy or dissident shareholder. Within the normal course of business, the Global Head or Corporate Governance Group may engage directly with BlackRock clients, and with employees with sales responsibilities, in discussions regarding general corporate governance policy matters, and to otherwise ensure proxy-related client service levels are met. The Global Head or Corporate Governance Group does not discuss any specific voting matter with a client prior to the disclosure of the vote decision to all applicable clients after the shareholder meeting has taken place, except if the client is acting in the capacity as issuer of the proxy or dissident shareholder and is engaging through the established procedures independent of the client relationship.

v) In certain instances, BlackRock may determine to engage an independent fiduciary to vote proxies as a further safeguard to avoid potential conflicts of interest or as otherwise required by applicable law. The independent fiduciary may either vote such proxies, or provide BlackRock with instructions as to how to vote such proxies. In the latter case, BlackRock votes the proxy in accordance with the independent fiduciary’s determination.  Use of an independent fiduciary has been adopted for voting the proxies related to any company that is affiliated with BlackRock, or any company that includes BlackRock employees on its board of directors.

With regard to the relationship between securities lending and proxy voting, BlackRock’s approach is driven by our clients’ economic interests. The evaluation of the economic desirability of recalling loans involves balancing the revenue producing value of loans against the likely economic value of casting votes. Based on our evaluation of this relationship, we believe that generally the likely economic value of casting most votes is less than the securities lending income, either because the votes will not have significant economic consequences or because the outcome of the vote would not be affected by BlackRock recalling loaned securities in order to ensure they are voted. Periodically, BlackRock analyzes the process and benefits of voting proxies for securities on loan, and will consider whether any modification of its proxy voting policies or procedures is necessary in light of future conditions. In addition, BlackRock may in its discretion determine that the value of voting outweighs the cost of recalling shares, and thus recall shares to vote in that instance.

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BlackRock global corporate governance & engagement principles

Voting guidelines

The attached issue-specific voting Guidelines for each region/country in which we vote are intended to summarize BlackRock’s general philosophy and approach to issues that may commonly arise in the proxy voting context in each market where we invest. These Guidelines are not intended to be exhaustive. BlackRock applies the Guidelines on a case-by-case basis, in the context of the individual circumstances of each company and the specific issue under review. As such, these Guidelines do not provide a guide to how BlackRock will vote in every instance. Rather, they share our view about corporate governance issues generally, and provide insight into how we typically approach issues that commonly arise on corporate ballots.

Reporting

We report our proxy voting activity directly to clients and publically as required. In addition, we publish for clients a more detailed discussion of our corporate governance activities, including engagement with companies and with other relevant parties.

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Proxy voting
guidelines for

U.S. securities

December 2009

Table of contents

INTRODUCTION 1

VOTING GUIDELINES 1

Boards and directors 2

Auditors and audit-related issues 6

Capital structure, mergers, asset sales and other special transactions 7

Remuneration and benefits 11

Social, ethical and environmental issues 14

General corporate governance matters 14

BLACKROCK

PROXY VOTING GUIDELINES FOR U.S. SECURITIES

These guidelines should be read in conjunction with BlackRock’s Global Corporate Governance and Engagement Principles.

INTRODUCTION

BlackRock, Inc. and its subsidiaries (collectively, “BlackRock”) seek to make proxy voting decisions in the manner most likely to protect and promote the economic value of the securities held in client accounts. The following issue-specific proxy voting guidelines (the “Guidelines”) are intended to summarize BlackRock’s general philosophy and approach to issues that may commonly arise in the proxy voting context for U.S. Securities. These Guidelines are not intended to limit the analysis of individual issues at specific companies and are not intended to provide a guide to how BlackRock will vote in every instance. Rather, they share our view about corporate governance issues generally, and provide insight into how we typically approach issues that commonly arise on corporate ballots. They are applied with discretion, taking into consideration the range of issues and facts specific to the company and the individual ballot item.

VOTING GUIDELINES

These guidelines are divided into six key themes which group together the issues that frequently appear on the agenda of annual and extraordinary meetings of shareholders.

The six key themes are:

• Boards and directors

• Auditors and audit-related issues

• Capital structure, mergers, asset sales and other special transactions

• Remuneration and benefits

• Social, ethical and environmental issues

• General corporate governance matters

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BlackRock proxy voting guidelines — U.S. securities

Boards and directors

Director elections

BlackRock generally supports board nominees in most uncontested elections. However, BlackRock may withhold votes from the entire board in certain situations, including, but not limited to:

• Where a board fails to implement shareholder proposals that receive a majority of votes cast at a prior shareholder meeting, and the proposals, in our view, have a direct and substantial impact on shareholders’ fundamental rights or long-term economic interests.

• Where a board implements or renews a poison pill without seeking shareholder approval beforehand or within a reasonable period of time after implementation.

BlackRock may withhold votes from members of particular board committees (or prior members, as the case may be) in certain situations, including, but not limited to:

• An insider or affiliated outsider who sits on any of the board’s key committees (i.e., audit, compensation, nominating and governance), which we believe generally should be entirely independent.  However, BlackRock will examine a board’s complete profile when questions of independence arise prior to casting a withhold vote for any director.  For controlled companies, as defined by the U.S. stock exchanges, we will only vote against insiders or affiliates who sit on the audit committee, but not other key committees.

• Members of the audit committee during a period when the board failed to facilitate quality, independent auditing.

• Members of the audit committee where substantial accounting irregularities suggest insufficient oversight by that committee.

• Members of the audit committee during a period in which we believe the company has aggressively accounted for its equity compensation plans.

• Members of the compensation committee during a period in which executive compensation appears excessive relative to performance and peers, and where we believe the compensation committee has not already substantially addressed this issue.

• Members of the compensation committee where the company has repriced options without contemporaneous shareholder approval.

• The chair of the nominating committee, or where no chair exists, the nominating committee member with the longest tenure, where board members have previously received substantial withhold votes and the board has not taken appropriate action to

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BlackRock proxy voting guidelines — U.S. securities

	respond to shareholder concerns. This may not apply in cases where BlackRock did not support the initial withhold vote.
•	The chair of the nominating committee, or where no chair exists, the nominating committee member with the longest tenure, where the board is not composed of a majority of independent directors.  However, this would not apply in the case of a controlled company.

BlackRock may withhold votes from individual board members in certain situations, including, but not limited to:

• Where BlackRock obtains evidence that casts significant doubt on a director’s qualifications or ability to represent shareholders.

• Where it appears the director has acted (at the company or at other companies) in a manner that compromises his or her reliability in representing the best long-term economic interests of shareholders.

• Where a director has a pattern of attending less than 75% of combined board and applicable key committee meetings.

Age limits / term limits

We typically oppose limits on the pool of directors from which shareholders can choose their representatives, especially where those limits are arbitrary or unrelated to the specific performance or experience of the director in question.

Board size

We generally defer to the board in setting the appropriate size. We believe directors are generally in the best position to assess what size is optimal to ensure a board’s effectiveness. However, we may oppose boards that appear too small to allow for effective shareholder representation or too large to function efficiently.

Classified board of directors / staggered terms

A classified board of directors is one that is divided into classes (generally three), each of which is elected on a staggered schedule (generally for three years). At each annual meeting, only a single class of directors is subject to reelection (generally one-third of the entire board).

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BlackRock proxy voting guidelines — U.S. securities

We believe that classification of the board dilutes shareholders’ right to evaluate promptly a board’s performance and limits shareholder selection of their representatives. By not having the mechanism to immediately address concerns we may have with any specific director, we lose the ability to provide valuable feedback to the company. Furthermore, where boards are classified, director entrenchment is more likely, because review of board service generally only occurs every three years. Therefore, we typically vote against classification and for proposals to eliminate board classification.

Cumulative voting for directors

Cumulative voting allocates one vote for each share of stock held, times the number of directors subject to election. A shareholder may cumulate his/her votes and cast all of them in favor of a single candidate, or split them among any combination of candidates. By making it possible to use their cumulated votes to elect at least one board member, cumulative voting is typically a mechanism through which minority shareholders attempt to secure board representation.

BlackRock may support cumulative voting proposals at companies where the board is not majority independent. However, we may oppose proposals that further the candidacy of minority shareholders whose interests do not coincide with our fiduciary responsibility.

Director compensation and equity programs

We believe that compensation for independent directors should be structured to align the interests of the directors with those of shareholders, whom the directors have been elected to represent. We believe that independent director compensation packages based on the company's long-term performance and that include some form of long-term equity compensation are more likely to meet this goal; therefore, we typically support proposals to provide such compensation packages. However, we will generally oppose shareholder proposals requiring directors to own a minimum amount of company stock, as we believe that companies should maintain flexibility in administering compensation and equity programs for independent directors, given each company’s and director’s unique circumstances.

Indemnification of directors and officers

We generally support reasonable but balanced protection of directors and officers. We believe that failure to provide protection to directors and officers might severely limit a

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BlackRock proxy voting guidelines — U.S. securities

company's ability to attract and retain competent leadership. We generally support proposals to provide indemnification that is limited to coverage of legal expenses. However, we may oppose proposals that provide indemnity for: breaches of the duty of loyalty; transactions from which a director derives an improper personal benefit; and actions or omissions not in good faith or those that involve intentional misconduct.

Independent board composition

We generally support shareholder proposals requesting that the board consist of a two-thirds majority of independent outside directors, as we believe that an independent board faces fewer conflicts and is best prepared to protect shareholder interests.

Liability insurance for directors and officers

Proposals regarding liability insurance for directors and officers often appear separately from indemnification proposals. We will generally support insurance against liability for acts committed in an individual's capacity as a director or officer of a company following the same approach described above with respect to indemnification.

Limits on director removal

Occasionally, proposals contain a clause stipulating that directors may be removed only for cause. We oppose this limitation of shareholders’ rights.

Majority vote requirements

BlackRock generally supports the concept of director election by majority vote. Majority voting standards assist in ensuring that directors who are not broadly supported by shareholders are not elected to serve as their representatives. However, we also recognize that there are many methods for implementing majority vote proposals. Where we believe that the company already has a sufficiently robust majority voting process in place, we may not support a shareholder proposal seeking an alternative mechanism.

Separation of chairman and CEO positions

We generally support shareholder proposals requesting that the positions of chairman and CEO be separated. We may consider the designation of a lead director to suffice in lieu of an independent chair, but will take into consideration the structure of that lead director’s position and overall corporate governance of the company in such cases.

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BlackRock proxy voting guidelines — U.S. securities

Shareholder access to the proxy

We believe that shareholders should have the opportunity, when necessary and under reasonable conditions, to nominate individuals to stand for election to the boards of the companies they own. In our view, securing a right of shareholders to nominate directors without engaging in a control contest can enhance shareholders’ ability to participate meaningfully in the director election process, stimulate board attention to shareholder interests, and provide shareholders an effective means of directing that attention where it is lacking.

We prefer an access mechanism that is equally applied to companies throughout the market with sufficient protections to limit the potential for abuse. Absent such a mechanism under current law, we consider these proposals on a case-by-case basis. In evaluating a proposal requesting shareholder access at a company, we consider whether access is warranted at that particular company at that time by taking into account the overall governance structure of the company as well as issues specific to that company that may necessitate greater board accountability. We also look for certain minimum ownership threshold requirements, stipulations that access can be used only in non-hostile situations, and reasonable limits on the number of board members that can be replaced through such a mechanism.

Auditors and audit-related issues

BlackRock recognizes the critical importance of financial statements that provide a complete and accurate portrayal of a company’s financial condition. Consistent with our approach to voting on boards of directors, we seek to hold the audit committee of the board responsible for overseeing the management of the audit function at a company, and may withhold votes from the audit committee’s members where the board has failed to facilitate quality, independent auditing. We take particular note of cases involving significant financial restatements or material weakness disclosures.

The integrity of financial statements depends on the auditor effectively fulfilling its role. To that end, we favor an independent auditor. In addition, to the extent that an auditor fails to reasonably identify and address issues that eventually lead to a significant financial restatement, or the audit firm has violated standards of practice that protect the interests of shareholders, we may also vote against ratification.

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BlackRock proxy voting guidelines — U.S. securities

From time to time, shareholder proposals may be presented to promote auditor independence or the rotation of audit firms. We may support these proposals when they are consistent with our views as described above.

Capital structure, mergers, asset sales and other special transactions

In reviewing merger and asset sale proposals, BlackRock's primary concern is the best long-term economic interests of shareholders. While these proposals vary widely in scope and substance, we closely examine certain salient features in our analyses. The varied nature of these proposals ensures that the following list will be incomplete. However, the key factors that we typically evaluate in considering these proposals include:

Market premium: For mergers and asset sales, we make every attempt to determine the degree to which the proposed transaction represents a premium to the company's trading price. In order to filter out the effects of pre-merger news leaks on the parties' share prices, we consider a share price from a time period in advance of the merger announcement. In most cases, business combinations should provide a premium; benchmark premiums vary by industry and direct peer group. Where one party is privately held, we look to the comparable transaction analyses provided by the parties' financial advisors. For companies facing insolvency or bankruptcy, a market premium may not apply.

Strategic reason for transaction:There should be a favorable business reason for the combination.

Board approval/transaction history:Unanimous board approval and arm's-length negotiations are preferred. We examine transactions that involve dissenting boards or that were not the result of an arm's-length bidding process to evaluate the likelihood that a transaction is in shareholders’ interests. We also seek to ensure that executive and/or board members’ financial interests in a given transaction do not affect their ability to place shareholders’ interests before their own.

Financial advisors' fairness opinions:We scrutinize transaction proposals that do not include the fairness opinion of a reputable financial advisor to evaluate whether shareholders’ interests were sufficiently protected in the merger process.

Anti-greenmail provisions

Greenmail is typically defined as payments to a corporate raider to terminate a takeover attempt. It may also occasionally refer to payments made to a dissident shareholder in order to terminate a potential proxy contest or shareholder proposal. We typically view such

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BlackRock proxy voting guidelines — U.S. securities

payments as a misuse of corporate assets which denies shareholders the opportunity to review a matter of direct economic concern and potential benefit to them. Therefore, we generally support proposals to prevent boards from making greenmail payments. However, we generally will oppose provisions designed to limit greenmail payments that appear to unduly burden or prohibit legitimate use of corporate funds.

Blank check preferred

See Preferred Stock.

Eliminate preemptive rights

Preemptive rights give current shareholders the opportunity to maintain their current percentage ownership despite any subsequent equity offerings. These provisions are no longer common in the U.S., and may restrict management's ability to raise new capital.

We generally support the elimination of preemptive rights, but will often oppose the elimination of limited preemptive rights, (e.g., rights that would limit proposed issuances representing more than an acceptable level of dilution).

Equal voting rights

BlackRock supports the concept of equal voting rights for all shareholders. Some management proposals request authorization to allow a class of common stock to have superior voting rights over the existing common or to allow a class of common to elect a majority of the board. We oppose such differential voting power as it may have the effect of denying shareholders the opportunity to vote on matters of critical economic importance to them.

However, when a shareholder proposal requests to eliminate an existing dual-class voting structure, we seek to determine whether this action is warranted at that company at that time, and whether the cost of restructuring will have a clear economic benefit to shareholders. We evaluate these proposals on a case-by-case basis, and we consider the level and nature of control associated with the dual-class voting structure as well as the company’s history of responsiveness to shareholders in determining whether support of such a measure is appropriate.

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BlackRock proxy voting guidelines — U.S. securities

Fair price provisions

Originally drafted to protect shareholders from tiered, front-end-loaded tender offers, these provisions have largely evolved into anti-takeover devices through the imposition of supermajority vote provisions and high premium requirements. BlackRock examines proposals involving fair price provisions and generally votes in favor of those that appear designed to protect minority shareholders, but against those that appear designed to impose barriers to transactions or are otherwise against the economic interests of shareholders.

Increase in authorized common shares

BlackRock considers industry specific norms in our analysis of these proposals, as well as a company’s history with respect to the use of its common shares. Generally, we are predisposed to support a company if the board believes additional common shares are necessary to carry out the firm’s business. The most substantial concern we might have with an increase is the possibility of use of common shares to fund a poison pill plan that is not in the economic interests of shareholders. Therefore, we generally do not support increases in authorized common shares where a company has no stated use for the additional common shares and/or has a substantial amount of previously authorized common shares still available for issue that is sufficient to allow the company to flexibly conduct its operations, especially if the company already has a poison pill in place. We may also oppose proposals that include common shares with unequal voting rights.

Increase or issuance of preferred stock

These proposals generally request either authorization of a class of preferred stock or an increase in previously authorized preferred stock. Preferred stock may be used to provide management with the flexibility to consummate beneficial acquisitions, combinations or financings on terms not necessarily available via other means of financing. We generally support these proposals in cases where the company specifies the voting, dividend, conversion and other rights of such stock where the terms of the preferred stock appear reasonable.

However, we frequently oppose proposals requesting authorization of a class of preferred stock with unspecified voting, conversion, dividend distribution and other rights (“blank check” preferred stock) because they may serve as a transfer of authority from shareholders to the board and a possible entrenchment device. We generally view the board’s discretion to establish voting rights on a when-issued basis as a potential anti-takeover device, as it affords the board the ability to place a block of stock with an investor sympathetic to management,

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BlackRock proxy voting guidelines — U.S. securities

thereby foiling a takeover bid without a shareholder vote. Nonetheless, where the company appears to have a legitimate financing motive for requesting blank check authority, has committed publicly that blank check preferred shares will not be used for anti-takeover purposes, has a history of using blank check preferred stock for financings, or has blank check preferred stock previously outstanding such that an increase would not necessarily provide further anti-takeover protection but may provide greater financing flexibility, we may support the proposal.

Poison pill plans

Also known as Shareholder Rights Plans, these plans generally involve issuance of call options to purchase securities in a target firm on favorable terms. The options are exercisable only under certain circumstances, usually accumulation of a specified percentage of shares in a relevant company or launch of a hostile tender offer. These plans are often adopted by the board without being subject to shareholder vote.

Poison pill proposals generally appear on the proxy as shareholder proposals requesting that existing plans be put to a vote. This vote is typically advisory and therefore non-binding. We generally vote in favor of shareholder proposals to rescind poison pills.

Where a poison pill is put to a shareholder vote, our policy is to examine these plans individually. Although we oppose most plans, we may support plans that include a reasonable 'qualifying offer clause.’ Such clauses typically require shareholder ratification of the pill, and stipulate a sunset provision whereby the pill expires unless it is renewed. These clauses also tend to specify that an all cash bid for all shares that includes a fairness opinion and evidence of financing does not trigger the pill, but forces either a special meeting at which the offer is put to a shareholder vote, or the board to seek the written consent of shareholders where shareholders could rescind the pill in their discretion. We may also support a pill where it is the only effective method for protecting tax or other economic benefits that may be associated with limiting the ownership changes of individual shareholders.

Stock splits and reverse stock splits

We generally support stock splits that are not likely to negatively affect the ability to trade shares or the economic value of a share. We generally support reverse splits that are designed to avoid delisting or to facilitate trading in the stock, where the reverse split will not have a negative impact on share value (e.g. one class is reduced while others remain at pre-

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BlackRock proxy voting guidelines — U.S. securities

split levels). In the event of a proposal to reverse split that would not also proportionately reduce the company’s authorized stock, we apply the same analysis we would use for a proposal to increase authorized stock.

Remuneration and benefits

We note that there are management and shareholder proposals related to executive compensation that appear on corporate ballots. We generally vote on these proposals as described below, except that we typically oppose shareholder proposals on issues where the company already has a reasonable policy in place that we believe is sufficient to address the issue. We may also oppose a shareholder proposal regarding executive compensation if the company’s history suggests that the issue raised is not likely to present a problem for that company.

Adopt advisory resolutions on compensation committee reports

BlackRock generally opposes these proposals, put forth by shareholders, which ask companies to adopt advisory resolutions on compensation committee reports (otherwise known as “Say-on-Pay”). We believe that compensation committees are in the best position to make compensation decisions and should maintain significant flexibility in administering compensation programs, given their knowledge of the wealth profiles of the executives they seek to incentivize, the appropriate performance measures for the company, and other issues internal and/or unique to the company. In our view, shareholders have a sufficient and much more powerful “say-on-pay” today in the form of director elections, in particular with regards to members of the compensation committee.

Advisory resolutions on compensation committee reports

In cases where there is an advisory vote on compensation put forth by management, BlackRock will respond to the proposal as informed by our evaluation of compensation practices at that particular company, and in a manner that appropriately addresses the specific question posed to shareholders. On the question of support or opposition to executive pay practices our vote is likely to correspond with our vote on the directors who are compensation committee members responsible for making compensation decisions. Generally we believe these matters are best left to the compensation committee of the board and that shareholders should not dictate the terms of executive compensation. Our preferred approach to managing pay-for-performance disconnects is via a withhold vote for the compensation committee.

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BlackRock proxy voting guidelines — U.S. securities

Claw back proposals

Claw back proposals are generally shareholder sponsored and seek recoupment of bonuses paid to senior executives if those bonuses were based on financial results that are later restated. We generally favor recoupment from any senior executive whose compensation was based on faulty financial reporting, regardless of that particular executive’s role in the faulty reporting. We typically support these proposals unless the company already has a robust claw back policy that sufficiently addresses our concerns.

Employee stock purchase plans

An employee stock purchase plan (“ESPP”) gives the issuer’s employees the opportunity to purchase stock in the issuer, typically at a discount to market value. We believe these plans can provide performance incentives and help align employees’ interests with those of shareholders. The most common form of ESPP qualifies for favorable tax treatment under Section 423 of the Internal Revenue Code. Section 423 plans must permit all full-time employees to participate, carry restrictions on the maximum number of shares that can be purchased, carry an exercise price of at least 85 percent of fair market value on grant date with offering periods of 27 months or less, and be approved by shareholders. We will typically support qualified ESPP proposals.

Equity compensation plans

BlackRock supports equity plans that align the economic interests of directors, managers and other employees with those of shareholders. Our evaluation of equity compensation plans in a post-expensing environment is based on a company’s executive pay and performance relative to peers and whether the plan plays a significant role in a pay-for-performance disconnect. We generally oppose plans that contain “evergreen” provisions allowing for the ongoing increase of shares reserved without shareholder approval. We also generally oppose plans that allow for repricing without shareholder approval. Finally, we may oppose plans where we believe that the company is aggressively accounting for the equity delivered through their stock plans.

Golden parachutes

Golden parachutes provide for compensation to management in the event of a change in control. We generally view this as encouragement to management to consider proposals that might be beneficial to shareholders. We normally support golden parachutes put to shareholder vote unless there is clear evidence of excess or abuse.

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BlackRock proxy voting guidelines — U.S. securities

We may also support shareholder proposals requesting that implementation of such arrangements require shareholder approval. In particular, we generally support proposals requiring shareholder approval of plans that exceed 2.99 times an executive’s current compensation.

Option exchanges

BlackRock may support a request to exchange underwater options under the following circumstances: the company has experienced significant stock price decline as a result of macroeconomic trends, not individual company performance; directors and executive officers are excluded; the exchange is value neutral or value creative to shareholders; and there is clear evidence that absent repricing the company will suffer serious employee incentive or retention and recruiting problems.

Pay-for-performance plans

In order for executive compensation exceeding $1 million to qualify for federal tax deductions, the Omnibus Budget Reconciliation Act (OBRA) requires companies to link that compensation, for the Company’s top five executives, to disclosed performance goals and submit the plans for shareholder approval. The law further requires that a compensation committee comprised solely of outside directors administer these plans. Because the primary objective of these proposals is to preserve the deductibility of such compensation, we generally favor approval in order to preserve net income.

Pay-for-superior-performance

These are typically shareholder proposals requesting that compensation committees adopt policies under which a portion of equity compensation requires the achievement of performance goals as a prerequisite to vesting. We generally believe these matters are best left to the compensation committee of the board and that shareholders should not set executive compensation or dictate the terms thereof. We may support these proposals if we have a substantial concern regarding the company’s compensation practices over a significant period of time, the proposals are not overly prescriptive, and we believe the proposed approach is likely to lead to substantial improvement. However, our preferred approach to managing pay-for-performance disconnects is via a withhold vote for the compensation committee.

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BlackRock proxy voting guidelines — U.S. securities

Supplemental executive retirement plans

BlackRock may support shareholder proposals requesting to put extraordinary benefits contained in Supplemental Executive Retirement Plans (“SERP”) agreements to a shareholder vote unless the company’s executive pension plans do not contain excessive benefits beyond what is offered under employee-wide plans.

Social, ethical and environmental issues

See Global Corporate Governance and Engagement Principles.

General corporate governance matters

Adjourn meeting to solicit additional votes

We generally support such proposals when the agenda contains items that we judge to be in shareholders’ best long-term economic interests.

Bundled proposals

We believe that shareholders should have the opportunity to review substantial governance changes individually without having to accept bundled proposals. Where several measures are grouped into one proposal, BlackRock may reject certain positive changes when linked with proposals that generally contradict or impede the rights and economic interests of shareholders. The decision to support or oppose bundled proposals requires a balancing of the overall benefits and drawbacks of each element of the proposal.

Change name of corporation

We typically defer to management with respect to appropriate corporate names.

Confidential voting

Shareholders most often propose confidential voting as a means of eliminating undue management pressure on shareholders regarding their vote on proxy issues. We generally support proposals to allow confidential voting. However, we will usually support suspension of confidential voting during proxy contests where dissidents have access to vote information and management may face an unfair disadvantage.

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BlackRock proxy voting guidelines — U.S. securities

Other business

We oppose giving companies our proxy to vote on matters where we are not given the opportunity to review and understand those measures and carry out an appropriate level of shareholder oversight.

Reincorporation

Proposals to reincorporate from one state or country to another are most frequently motivated by considerations of anti-takeover protections or cost savings. Where cost savings are the sole issue, we will typically favor reincorporating. In all instances, we will evaluate the changes to shareholder protection under the new charter/articles/by-laws to assess whether the move increases or decreases shareholder protections. Where we find that shareholder protections are diminished, we will support reincorporation if we determine that the overall benefits outweigh the diminished rights.

Shareholders' right to call a special meeting or act by written consent

In exceptional circumstances and with sufficiently broad support, shareholders should have the opportunity to raise issues of substantial importance without having to wait for management to schedule a meeting. We therefore believe that shareholders should have the right to call a special meeting or to solicit votes by written consent in cases where a reasonably high proportion of shareholders (typically a minimum of 15%) are required to agree to such a meeting/consent before it is called, in order to avoid misuse of this right and waste corporate resources in addressing narrowly supported interests. However, we may oppose this right in cases where the provision is structured for the benefit of a dominant shareholder to the exclusion of others.

Simple majority voting

We generally favor a simple majority voting requirement to pass proposals. Therefore we will support the reduction or the elimination of supermajority voting requirements to the extent that we determine shareholders’ ability to protect their economic interests is improved. Nonetheless, in situations where there is a substantial or dominant shareholder, supermajority voting may be protective of public shareholder interests and we may therefore support supermajority requirements in those situations.

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BlackRock proxy voting guidelines — U.S. securities

Stakeholder provisions

Stakeholder provisions introduce the concept that the board may consider the interests of constituencies other than shareholders when making corporate decisions. Stakeholder interests vary widely and are not necessarily consistent with the best long-term economic interests of all shareholders, whose capital is at risk in the ownership of a public company. We believe the board’s fiduciary obligation is to ensure management is employing this capital in the most efficient manner so as to maximize shareholder value, and we oppose any provision that suggests the board should do otherwise.

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