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<SEC-DOCUMENT>0000900092-11-000023.txt : 20110106
<SEC-HEADER>0000900092-11-000023.hdr.sgml : 20110106
<ACCEPTANCE-DATETIME>20110106141514
ACCESSION NUMBER:		0000900092-11-000023
CONFORMED SUBMISSION TYPE:	N-CSR
PUBLIC DOCUMENT COUNT:		10
CONFORMED PERIOD OF REPORT:	20101031
FILED AS OF DATE:		20110106
DATE AS OF CHANGE:		20110106
EFFECTIVENESS DATE:		20110106

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BLACKROCK ENHANCED CAPITAL & INCOME FUND, INC
		CENTRAL INDEX KEY:			0001278895
		IRS NUMBER:				000000000

	FILING VALUES:
		FORM TYPE:		N-CSR
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-21506
		FILM NUMBER:		11513704

	BUSINESS ADDRESS:	
		STREET 1:		100 BELLEVUE PARKWAY
		CITY:			WILMINGTON
		STATE:			DE
		ZIP:			19809
		BUSINESS PHONE:		800-441-7762

	MAIL ADDRESS:	
		STREET 1:		100 BELLEVUE PARKWAY
		CITY:			WILMINGTON
		STATE:			DE
		ZIP:			19809

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	BLACKROCK CAPITAL & INCOME STRATEGIES FUND INC
		DATE OF NAME CHANGE:	20061018

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CAPITAL & INCOME STRATEGIES FUND INC
		DATE OF NAME CHANGE:	20040205
</SEC-HEADER>
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<DESCRIPTION>CII
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<FONT size=3 face="ArialMT,Arial,Helvetica,sans-serif">UNITEDSTATES</FONT><BR>
<FONT size=3 face="ArialMT,Arial,Helvetica,sans-serif">SECURITIESANDEXCHANGECOMMISSION</FONT><BR>
<FONT size=3 face="ArialMT,Arial,Helvetica,sans-serif">Washington,D.C.20549</FONT><BR>
<BR>
<B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">FORM N-CSR</FONT></B><BR>
<BR>
<B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT</FONT></B><BR>
<B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">INVESTMENT COMPANIES</FONT></B></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Company Act file number 811-21506</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Name of Fund: BlackRock Enhanced Capital and Income Fund, Inc. (CII)</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Name and address of agent for service: Anne F. Ackerley, Chief Executive Officer, BlackRock</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Enhanced Capital and Income Fund, Inc., 55 East 52</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">nd </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Street, New York, NY 10055</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Registrant&#146;s telephone number, including area code: (800) 882-0052, Option 4</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date of fiscal year end: 10/31/2010</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date of reporting period: 10/31/2010</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 1 &#150; Report to Stockholders</FONT></P>

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<P style="text-align: left;">
<FONT size=5 face="CorporateE-Regular,Times New Roman,Times,serif">Annual Report</FONT></P>
<P style="text-align: left;">
<FONT color="#231f20" size=2 face="CorporateS-Regular,Arial,Helvetica,sans-serif">BlackRock Enhanced Capital and Income Fund, Inc. (CII)</FONT></P>
<P style="text-align: left;">
<B><FONT color="#231f20" size=3 face="CorporateS-Medium,Arial,Helvetica,sans-serif">October 31, 2010</FONT></B></P>
<P style="text-align: left;">
<B><FONT color="#231f20" size=1 face="CorporateE-Bold,Times New Roman,Times,serif">Not FDIC Insured &#149; No Bank Guarantee &#149; May Lose Value</FONT></B></P>

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<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=74%></TD>
     <TD width=25%></TD></TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT color="#004a91" size=4 face="FranklinGothic-Book,Arial,Helvetica,sans-serif">Table of Contents</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD bgcolor="#e4e6f2" align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD bgcolor="#e4e6f2" align=right style="border-bottom:1px solid #000000;">
<B><FONT color="#004a91" size=1 face="FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif">Page</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Dear Shareholder</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">3</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT color="#231f20" size=2 face="FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif">Annual Report:</FONT></B>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Fund Summary</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">4</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Derivative Financial Instruments</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">5</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Financial Statements:</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:3.000000px">
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Schedule of Investments</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">6</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:3.000000px">
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Statement of Assets and Liabilities</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">9</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:3.000000px">
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Statement of Operations</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">10</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="TEXT-INDENT:3.000000px">
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Statements of Changes in Net Assets</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">11</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Financial Highlights</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">12</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Notes to Financial Statements</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">13</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Report of Independent Registered Public Accounting Firm</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">18</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Important Tax Information</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">18</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">19</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Automatic Dividend Reinvestment Plan</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">23</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Officers and Directors</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">24</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Additional Information</FONT>&nbsp;</TD>
	<TD align=right>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">27</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<B><FONT color="#004a91" size=1 face="FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif">Section 19(b) Disclosure</FONT></B><BR>
<BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">BlackRock Enhanced Capital and Income Fund, Inc. (CII) (the &#147;Fund&#148;), acting pursuant to a Securities and Exchange Commission (&#147;SEC&#148;) exemptive</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">order and with the approval of the Fund&#146;s Board of Directors (the &#147;Board&#148;), has adopted a plan, consistent with its investment objectives and policies to</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">support a level distribution of income, capital gains and/or return of capital (&#147;the Plan&#148;). In accordance with the Plan, the Fund currently distributes the</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">following fixed amount per share on a quarterly basis:</FONT></P>
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<B><FONT color="#231f20" size=2 face="FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif">Exchange Symbol</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT color="#231f20" size=2 face="FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif">Amount Per Common Share</FONT></B>&nbsp;</TD>
</TR>
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	<TD align=center>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">CII</FONT>&nbsp;</TD>
	<TD align=center>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">&#36; 0.485</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">The fixed amount distributed per share is subject to change at the discretion of the Fund&#146;s Board. Under the Plan, the Fund will distribute all available</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">investment income to its shareholders, consistent with its primary investment objectives and as required by the Internal Revenue Code of 1986, as</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">amended (the &#147;Code&#148;). If sufficient investment income is not available on a quarterly basis, the Fund will distribute long-term capital gains and/or</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">return of capital to shareholders in order to maintain a level distribution. Each quarterly distribution to shareholders is expected to be at the fixed</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">amount established by the Board, except for extraordinary distributions and potential distribution rate increases or decreases to enable the Fund to</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">comply with the distribution requirements imposed by the Code.</FONT><BR>
<BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Shareholders should not draw any conclusions about the Fund&#146;s investment performance from the amount of these distributions or from the terms of the</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Plan. The Fund&#146;s total return performance on net asset value is presented in its financial highlights table.</FONT><BR>
<BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">The Board may amend, suspend or terminate the Fund&#146;s Plan without prior notice if it deems such action to be in the best interest of the Fund or its</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">shareholders. The suspension or termination of the Plan could have the effect of creating a trading discount (if the Fund&#146;s stock is trading at or above</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">net asset value) or widening an existing trading discount. The Fund is subject to risks that could have an adverse impact on its ability to maintain level</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">distributions. Examples of potential risks include, but are not limited to, economic downturns impacting the markets, decreased market volatility, com-</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">panies suspending or decreasing corporate dividend distributions and changes in the Code. Please refer to the Fund&#146;s prospectus for a more complete</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">description of its risks.</FONT><BR>
<BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">Please refer to Additional Information for a cumulative summary of the Section 19(a) notices for the Fund&#146;s current fiscal period. Section 19(a) notices</FONT><BR>
<FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">for the Fund, as applicable, are available on the BlackRock website </FONT><FONT color="#231f20" size=2 face="FranklinGothic-MedCnd,Arial,Helvetica,sans-serif">www.blackrock.com</FONT><FONT color="#231f20" size=2 face="FranklinGothic-BookCnd,Arial,Helvetica,sans-serif">.</FONT></P>
<P style="text-align: left;">
<FONT color="#231f20" size=1 face="FranklinGothic-Book,Arial,Helvetica,sans-serif">2 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>

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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Dear Shareholder</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The global economic recovery that began in 2009 has continued on its choppy course this year, delivering mixed but slowly improving economic data</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and gradual if uneven improvement of investor sentiment. The risks of a double-dip recession continue to recede, but the economy remains mired in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>a slow-growth environment. In the United States, the National Bureau of Economic Research declared that the &#147;Great Recession&#148; ended in June 2009.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Spanning December 2007 to June 2009, this marked the longest reported recession since the Great Depression. Structural problems of ongoing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>deleveraging and weak spending among businesses and households weigh heavily on the pace of economic growth. The unemployment rate remains</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>stubbornly high in the face of sluggish job gains in the private sector. The US dollar, along with other developed market currencies, has experienced</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>devaluation resulting from aggressively easy monetary and fiscal policies. Given these long-standing conditions, the Federal Reserve Board has</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>announced that additional policy action will be taken to combat deflation and unemployment and promote economic growth.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The high levels of volatility experienced in global equity markets throughout 2009 continued into 2010 as mixed economic data and lingering credit</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>issues caused stocks to trade in both directions, but by the end of the first quarter, most markets had managed to post gains. The second quarter,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in contrast, brought higher levels of volatility and a &#147;flight to quality&#148; as investor sentiment was dominated by fears of a double-dip recession. Global</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>equity markets saw negative quarterly returns &#151; and for many markets, the first significant downturn since the bull market began in March 2009. In</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the third quarter, economic data turned less negative and strong corporate earnings reports became increasingly consistent. These factors, along</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with attractive valuations and expectations for additional quantitative easing, drove equity markets higher, with most markets recapturing their second</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>quarter losses. Stocks continued their rally into the beginning of the fourth quarter, closing out the 12-month period in positive territory. International</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>equities posted gains on both a six- and 12-month basis. In the United States, both large and small cap equities posted robust gains for the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12-month period, while on a six-month basis, large cap stocks remained relatively flat and small caps turned slightly negative.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In fixed income markets, yields fluctuated but declined significantly over the past 12 months amid heightened uncertainty. Weak economic data,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>lingering credit problems and, near the end of the period, the expectation of additional quantitative easing drove interest rates lower and bond prices</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>higher. Treasuries rallied over the period, modestly outperforming the credit spread sectors of the market. Corporate credit spreads benefited from the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>low interest rate environment and high yield fixed income became increasingly attractive due to declining default rates and better-than-expected</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>results on European bank stress tests. Tax-exempt municipal bonds performed well over the 12-month period, driven primarily by technical factors</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>including favorable supply-and-demand dynamics.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Cash investments, as represented by the 3-month Treasury bill, returned only a fraction over 0% for the 12-month period as short-term interest rates</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>remained low. Yields on money market securities remain near all-time lows.</FONT></P>
<DIV align=left>
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     <TD width="64%"></TD>
     <TD width="22%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Against this backdrop, the major market averages posted the following returns:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Returns as of October 31, 2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>6-month</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>12-month</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US large cap equities (S&amp;P 500 Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 1px" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.74%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16.52%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US small cap equities (Russell 2000 Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.24)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>26.58</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>International equities (MSCI Europe, Australasia, Far East Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5.74</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8.36</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3-month Treasury bill (BofA Merrill Lynch 3-Month Treasury Bill Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.08</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.12</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US Treasury securities (BofA Merrill Lynch 10-Year US Treasury Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10.63</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10.03</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US investment grade bonds (Barclays Capital US Aggregate Bond Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5.33</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8.01</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Tax-exempt municipal bonds (Barclays Capital Municipal Bond Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3.95</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7.78</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US high yield bonds (Barclays Capital US Corporate High Yield 2% Issuer Capped Index)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>6.73</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19.10</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Past performance is no guarantee of future results. Index performance shown for illustrative purposes only. You cannot invest directly in an index.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>As global economic conditions continue to improve, investors across the world continue to face uncertainty about the future of economic growth.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Through periods of uncertainty, as ever, BlackRock&#146;s full resources are dedicated to the management of our clients&#146; assets. For additional market</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>perspective and investment insight, visit </FONT><FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>www.blackrock.com/shareholdermagazine</FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>, where you&#146;ll find the most recent issue of our award-winning</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCndItal,Arial,Helvetica,sans-serif>Shareholder&#174; </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>magazine, as well as its quarterly companion newsletter, </FONT><FONT color=#231f20 size=2 face=FranklinGothic-MedCndItal,Arial,Helvetica,sans-serif>Shareholder Perspectives</FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>. As always, we thank you for entrusting BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with your investments, and we look forward to your continued partnership in the months and years ahead.</FONT></P>
<IMG border=0 src="brenhancedcapincsar1010x3x1.jpg">
<BR>
<P style="TEXT-ALIGN: left"><FONT color=#6c6e70 size=2 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>THIS PAGE NOT PART OF YOUR FUND REPORT</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>3</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Fund Summary </FONT><FONT color=#004a91 size=2 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>as of October 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc.</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund Overview</FONT></B><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc.&#146;s (CII) (the &#147;Fund&#148;) </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investment objective is to provide investors with a combination of current</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>income and capital appreciation. The Fund seeks to achieve its investment objective by investing in a portfolio of equity and debt securities of US and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>foreign issuers. The Fund may invest directly in such securities or synthetically through the use of derivatives. The Trust utilizes an option writing (selling)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>strategy to enhance current gains.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>No assurance can be given that the Fund&#146;s investment objective will be achieved.</FONT><BR>
<BR>
<B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Performance</FONT></B><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For the 12 months ended October 31, 2010, the Fund returned 24.73% based on market price and 15.22% based on net asset value (&#147;NAV&#148;). For</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the same period, the benchmark S&amp;P 500 Value Index returned 15.54%. All returns reflect reinvestment of dividends. The Fund moved from a discount</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. The fol-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>lowing discussion relates to performance based on NAV. The main detractor from Fund performance relative to the S&amp;P 500 Value Index was an over-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>weight in the information technology sector. Stock selection within consumer staples also hindered returns, most notably due to holdings of LSI Corp.,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Nucor Corp. and Unilever NV. Contributing positively to performance was the Fund&#146;s underweight and stock selection in the financials sector. An over-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>weight and stock selection in telecommunication services also had a positive impact, as did stock selection in health care. On an individual security</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>basis, an underweight position in Bank of America Corp. proved beneficial, while overweight positions in Qwest Communications International, Inc.,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Limited Brands, Inc. and ACE Ltd. boosted returns. In addition, earnings generated through the Trust&#146;s option writing strategy enhanced performance for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the period</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>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.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>These views are not intended to be a forecast of future events and are no guarantee of future results.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="66%"></TD>
     <TD width="33%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund Information</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Symbol on NYSE</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>CII</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Initial Offering Date</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>April 30, 2004</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Yield on Closing Market Price as of October 31, 2010 ($15.03)</FONT><SUP><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1</FONT></SUP>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12.91%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Current Quarterly Distribution per share</FONT><SUP><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2</FONT></SUP>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$0.485</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Current Annualized Distribution per share</FONT><SUP><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$1.940</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>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</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>results.</FONT><BR>
<SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The distribution is not constant and is subject to change. A portion of the distribution may be deemed a tax return of capital or net realized gain.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="32%"></TD>
     <TD width="30%"></TD>
     <TD width="10%"></TD>
     <TD width="8%"></TD>
     <TD width="9%"></TD>
     <TD width="7%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The table below summarizes the changes in the Fund&#146;s market price and NAV per share:</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>10/31/10</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>10/31/09</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Change</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>High</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Low</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Market Price</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$15.03</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$13.76</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9.23%</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$16.49</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$11.68</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net Asset Value</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$14.53</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$14.40</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.90%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$15.51</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$13.29</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The following charts show the ten largest holdings and sector allocations of the Fund&#146;s long-term investments:</FONT></P>
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     <TD width="73%"></TD>
     <TD width="26%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=right><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Ten Largest Holdings</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>10/31/10</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Qwest Communications International, Inc.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Maxim Integrated Products, Inc.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Bristol-Myers Squibb Co.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Travelers Cos., Inc.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kraft Foods, Inc.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pfizer, Inc.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chevron Corp.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kimberly-Clark Corp.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Eli Lilly &amp; Co.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Unilever NV &#151; ADR</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 4px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="53%"></TD>
     <TD width="29%"></TD>
     <TD width="17%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=center><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Sector Allocations</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>10/31/10</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>10/31/09</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Financials</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 2px" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16%</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Information Technology</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Health Care</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>13</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Consumer Staples</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Energy</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Industrials</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Consumer Discretionary</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>6</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Telecommunication Services</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Materials</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Utilities</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For Fund compliance purposes, the Fund&#146;s sector classifications refer to any one</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or more of the sector sub-classifications used by one or more widely recognized</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>market indexes or ratings group indexes, and/or as defined by Fund management.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>This definition may not apply for purposes of this report, which may combine sec-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tor sub-classifications for reporting ease.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>4 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Derivative Financial Instruments</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund may invest in various derivative instruments, including options,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>as specified in Note 2 of the Notes to Financial Statements, which con-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>stitute forms of economic leverage. Such instruments are used to obtain</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>exposure to a market without owning or taking physical custody of secu-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>rities or to hedge market and/or equity risks. Such derivative instruments</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>involve risks, including the imperfect correlation between the value of a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>derivative instrument and the underlying asset, possible default of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>counterparty to the transaction or illiquidity of the derivative instrument.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund&#146;s ability to successfully use a derivative instrument depends on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the investment advisor&#146;s ability to accurately predict pertinent market</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>movements, which cannot be assured. The use of derivative instruments</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may result in losses greater than if they had not been used, may require</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund to sell or purchase portfolio investments at inopportune times</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or for distressed values, may limit the amount of appreciation the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>can realize on an investment or may cause a Fund to hold an investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>that they might otherwise sell. The Fund&#146;s investments in these instru-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments are discussed in detail in the Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>5</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Schedule of Investments </FONT><FONT color=#004a91 size=2 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>October 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. (CII)</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Percentages shown are based on Net Assets)</FONT></B></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="60%"></TD>
     <TD width="17%"></TD>
     <TD width="21%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Common Stocks</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Aerospace &amp; Defense &#151; 5.4%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Honeywell International, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>310,200</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14,613,522</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Northrop Grumman Corp.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>173,400</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10,960,614</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Raytheon Co. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>192,900</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8,888,832</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>34,462,968</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital Markets &#151; 3.6%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Invesco Ltd. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>623,500</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14,340,500</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Morgan Stanley (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>351,213</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>8,734,667</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>23,075,167</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Chemicals &#151; 2.7%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>E.I. du Pont de Nemours &amp; Co. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>356,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16,864,776</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Commercial Banks &#151; 1.2%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Wells Fargo &amp; Co. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>302,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,894,416</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Communications Equipment &#151; 0.8%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Nokia Oyj &#151; ADR (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>476,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,091,156</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Diversified Financial Services &#151; 3.7%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Citigroup, Inc. (b)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,396,500</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,993,405</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>JPMorgan Chase &amp; Co. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>355,800</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>13,388,754</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>23,382,159</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Diversified Telecommunication Services &#151; 8.2%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>AT&amp;T Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>462,000</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>13,167,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Qwest Communications International, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,301,000</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>21,786,600</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Verizon Communications, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>520,800</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16,910,376</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>51,863,976</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Electric Utilities &#151; 2.7%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>NextEra Energy, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>136,944</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,537,398</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Southern Co. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>262,200</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,929,514</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17,466,912</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Electrical Equipment &#151; 2.2%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Emerson Electric Co.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>259,200</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14,230,080</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Energy Equipment &amp; Services &#151; 2.8%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Ensco International Plc &#151; ADR (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>269,900</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,507,166</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Halliburton Co. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>169,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,406,642</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17,913,808</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Food Products &#151; 7.8%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>General Mills, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>327,400</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,290,596</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kraft Foods, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>609,600</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19,671,792</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Unilever NV &#151; ADR (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>600,200</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17,819,938</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>49,782,326</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Household Products &#151; 2.9%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kimberly-Clark Corp. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>289,900</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>18,362,266</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>IT Services &#151; 1.5%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>International Business Machines Corp. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>65,353</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,384,691</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Industrial Conglomerates &#151; 2.0%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>General Electric Co.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>775,000</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,415,500</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="56%"></TD>
     <TD width="21%"></TD>
     <TD width="21%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Common Stocks</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Insurance &#151; 7.3%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ACE Ltd. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>239,900</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14,254,858</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>MetLife, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>298,025</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,019,348</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Travelers Cos., Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>366,230</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>20,215,896</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>46,490,102</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Media &#151; 4.8%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Comcast Corp., Special Class A</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>725,300</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14,020,049</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Time Warner, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>509,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16,570,347</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>30,590,396</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Metals &amp; Mining &#151; 2.2%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Nucor Corp. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>363,700</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>13,900,614</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Multi-Utilities &#151; 1.5%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dominion Resources, Inc. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>215,800</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,378,668</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Oil, Gas &amp; Consumable Fuels &#151; 7.0%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chevron Corp. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>230,100</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19,008,561</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Exxon Mobil Corp. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>244,500</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>16,251,915</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Marathon Oil Corp.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>267,100</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,500,747</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>44,761,223</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Pharmaceuticals &#151; 13.4%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Bristol-Myers Squibb Co. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>763,000</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>20,524,700</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Eli Lilly &amp; Co.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>512,100</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>18,025,920</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Johnson &amp; Johnson (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>145,300</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,251,251</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Merck &amp; Co, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>490,000</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17,777,200</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pfizer, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,111,800</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19,345,320</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>84,924,391</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Semiconductors &amp; Semiconductor Equipment &#151; 9.3%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Analog Devices, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>471,600</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>15,878,772</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Intel Corp. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>767,200</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>15,397,704</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>LSI Corp. (b)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,359,300</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,122,732</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Maxim Integrated Products, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>965,000</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>20,901,900</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>59,301,108</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Software &#151; 2.0%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Microsoft Corp. (a)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>465,600</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,403,584</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Specialty Retail &#151; 3.5%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Home Depot, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>418,500</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,923,280</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Limited Brands, Inc. (a)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>320,900</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,431,251</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>22,354,531</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Long-Term Investments</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Cost &#151; $648,141,680) &#151; 98.5%</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>626,294,818</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Short-Term Securities</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Liquidity Funds, TempFund,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Institutional Class, 0.21% (c)(d)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Short-Term Securities</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Cost &#151; $11,668,594) &#151; 1.8%</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Investments Before Options Written</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Cost &#151; $659,810,274*) &#151; 100.3%</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>637,963,412</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="19%"></TD>
     <TD width="80%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 colSpan=2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Portfolio Abbreviation</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>ADR</FONT></B>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>American Depositary Receipts</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>6 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
<HR align=center SIZE=2 width="100%" noShade>
<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

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<A name="page_8"></A><BR>
<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Schedule of Investments (continued)</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. (CII)</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Percentages shown are based on Net Assets)</FONT></B></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="62%"></TD>
     <TD width="5%"></TD>
     <TD width="10%"></TD>
     <TD width="5%"></TD>
     <TD width="17%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Options Written</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Contracts</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 2px" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Exchange-Traded Call Options Written &#151; (0.7)%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ACE Ltd. Strike Price $59, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>160</FONT>&nbsp;</TD>
     <TD colSpan=2 align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (19,307)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>AT&amp;T Inc., Strike Price $29, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,000</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(22,000)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Bristol-Myers Squibb Co., Strike Price $28,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4,160</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(31,200)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dominion Resources, Inc., Strike Price $45,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,060</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(21,200)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Ensco International Plc &#151; ADR:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $45, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,130</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(245,775)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $48, Expires 12/18/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>350</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(46,375)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Exxon Mobil Corp., Strike Price $62.50,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>900</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(364,500)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>General Electric Co.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $16.50, Expires 11/22/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Jeffries &amp; Co., Inc.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>800</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(13,723)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $16.45, Expires 11/29/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Jeffries &amp; Co., Inc.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4,390</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(100,140)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Halliburton Co., Strike Price $35, Expires 12/18/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>935</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(59,840)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Home Depot, Inc., Strike Price $31, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,130</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(222,230)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Honeywell International, Inc., Strike Price $46,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,700</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(295,800)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Intel Corp.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $20, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>300</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(13,650)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $19.35, Expires 11/29/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,920</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(388,911)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>International Business Machines Corp., Strike Price</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$135, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>275</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(239,938)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Invesco Ltd., Strike Price $22.50, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>300</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(27,000)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>JPMorgan Chase &amp; Co.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $40, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>525</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(10,237)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $41, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>360</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(3,060)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $42, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>360</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1,260)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Johnson &amp; Johnson, Strike Price $62.50,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,090</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(176,035)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kimberly-Clark Corp., Strike Price $67.50,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,590</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(7,950)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Kraft Foods, Inc., Strike Price $32 Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4,560</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(326,040)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Limited Brands, Inc., Strike Price $30,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,760</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(140,800)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Maxim Integrated Products, Inc., Strike Price $19,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,900</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(517,750)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>MetLife, Inc., Strike Price $40, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,045</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(109,203)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Microsoft Corp., Strike Price $26, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,650</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(253,075)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Morgan Stanley, Strike Price $27, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,230</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(11,685)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Nokia Oyj &#151; ADR, Strike Price $10, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,700</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(135,150)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Nucor Corp., Strike Price $39, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,270</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(92,075)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pfizer, Inc., Strike Price $18, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1,250)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Raytheon Co.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $46, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>730</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(70,080)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $47.50, Expires 11/29/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>720</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(33,067)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Southern Co., Strike Price $38, Expires 12/18/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,965</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(132,638)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Time Warner, Inc., Strike Price $32, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,800</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(301,000)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Unilever NV &#151; ADR, Strike Price $30, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>400</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(25,000)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Verizon Communications, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $32, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,229</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(179,435)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $34, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>636</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(5,724)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Wells Fargo &amp; Co.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $25, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>150</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(21,450)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $27, Expires 11/20/10</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,500</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(54,000)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(4,719,553)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="62%"></TD>
     <TD width="6%"></TD>
     <TD width="9%"></TD>
     <TD width="6%"></TD>
     <TD width="15%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Options Written</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Contracts</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Over-the-Counter Call Options Written &#151; (1.0)%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ACE Ltd.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $56.11, Expires 11/10/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Credit Suisse International</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>680</FONT>&nbsp;</TD>
     <TD colSpan=2 align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (225,386)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>AT&amp;T Inc., Strike Price $28.85, Expires 11/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,540</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(7,029)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Analog Devices, Inc., Strike Price $31.25, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/02/10, Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,650</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(399,300)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chevron Corp., Strike Price $80.91, Expires 11/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,720</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(313,523)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Citigroup, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $4.11, Expires 11/04/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,180</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(29,644)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $3.82, Expires 11/12/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,500</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(88,212)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $4, Expires 11/12/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,500</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(49,725)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Comcast Corp., Special Class A, Strike Price $17.10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/04/10, Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,540</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(567,487)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dominion Resources, Inc., Strike Price $44.18,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/15/10, Broker Morgan Stanley</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>555</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(13,190)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>E.I. du Pont de Nemours &amp; Co., Strike Price $47.30,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 1/05/11, Broker Morgan Stanley Capital</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Services, Inc.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,676</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(503,570)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Eli Lilly &amp; Co., Strike Price $36.25, Expires 11/12/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,800</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(24,119)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Emerson Electric Co., Strike Price $52.70, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/10/10, Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>910</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(217,285)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Exxon Mobil Corp., Strike Price $61.20, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/08/10, Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>930</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(491,970)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>General Mills, Inc., Strike Price $37.40, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/15/10, Broker Credit Suisse International</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,455</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(175,861)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>International Business Machines Corp., Strike Price</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$141, Expires 12/09/10, Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>80</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(36,468)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Invesco Ltd., Strike Price $21.88, Expires 12/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,880</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(251,482)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>LSI Corp.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $4.75, Expires 11/15/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>385</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(19,514)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $4.55, Expires 11/30/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,900</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(206,654)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $5.23, Expires 12/13/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,470</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(30,094)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Marathon Oil Corp., Strike Price $35.52,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 12/09/10, Broker Credit Suisse International</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,470</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(171,318)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Maxim Integrated Products, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $17.61, Expires 11/10/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,155</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(467,775)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $18.67, Expires 12/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,290</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(385,710)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $18.80, Expires 12/02/10, Broker</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>960</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(274,771)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Merck &amp; Co, Inc., Strike Price $37.50, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/30/10, Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,700</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(114,523)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Microsoft Corp., Strike Price $25.78, Expires</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11/09/10, Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>450</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(42,450)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>NextEra Energy, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $57.01, Expires 11/08/10, Broker UBS AG</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>824</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(4,063)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $55.50, Expires 11/15/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>205</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(9,603)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Northrop Grumman Corp., Strike Price $61.58,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expires 11/05/10, Broker Morgan Stanley</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,300</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(233,449)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>7</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Schedule of Investments (concluded)</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. (CII)</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Percentages shown are based on Net Assets)</FONT></B></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="62%"></TD>
     <TD width="15%"></TD>
     <TD width="22%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Options Written</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Contracts</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 6px" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Over-the-Counter Call Options Written (concluded)</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pfizer, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $17.50, Expires 11/05/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4,000</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (67,080)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $17.40, Expires 11/24/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4,230</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(170,046)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Qwest Communications International, Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $6.32, Expires 11/10/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker JPMorgan Chase Bank NA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,855</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(218,983)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $6.26, Expires 11/30/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>6,750</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(355,820)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $6.69, Expires 12/10/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Citibank NA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,500</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(75,735)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Travelers Cos., Inc.:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $53.16, Expires 11/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>932</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(190,501)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $54.32, Expires 11/02/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>350</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(33,232)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Unilever NV &#151; ADR:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $30.11, Expires 11/05/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Goldman Sachs Bank USA</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,534</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(31,623)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Strike Price $30.26, Expires 11/05/10,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Broker Morgan Stanley Capital Services, Inc.</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>170</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(2,759)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(6,499,954)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Options Written</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(Premiums Received &#151; $8,684,558) &#151; (1.7)%</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(11,219,507)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Investments, Net of Options Written &#151; 98.6%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>626,743,905</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Other Assets Less Liabilities &#151; 1.4%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>9,104,986</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets &#151; 100.0%</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 635,848,891</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>* The cost and unrealized appreciation (depreciation) of investments as of October</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>31, 2010, as computed for federal income tax purposes were as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="57%"></TD>
     <TD width="42%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Aggregate cost</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 697,410,122</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Gross unrealized appreciation</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 6,826,552</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Gross unrealized depreciation</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(66,273,262)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net unrealized depreciation</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (59,446,710)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(a) Security, or a portion thereof, pledged/held as collateral for outstanding</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>options written.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(b) Non-income producing security.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(c) Investments in companies considered to be an affiliate of the Fund during the</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>amended, were as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="25%"></TD>
     <TD width="20%"></TD>
     <TD width="19%"></TD>
     <TD width="21%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares Held at</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares Held at</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>October 31,</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>October 31,</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Affiliate</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2009</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Activity</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Income</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Liquidity</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Funds, TempFund,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Institutional Class</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>24,567,455</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(12,898,861)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$30,414</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(d) Represents the current yield as of report date.</FONT><BR>
<FONT color=#231f20 size=2 face=Frutiger-Roman,Arial,Helvetica,sans-serif>&#149; </FONT><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For Fund compliance purposes, the Fund&#146;s industry classifications refer to any</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>one or more of the industry sub-classifications used by one or more widely rec-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ognized market indexes or rating group indexes, and/or as defined by Fund</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>management. This definition may not apply for purposes of this report, which</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may combine such industry sub-classifications for reporting ease.</FONT><BR>
<FONT color=#231f20 size=2 face=Frutiger-Roman,Arial,Helvetica,sans-serif>&#149; </FONT><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fair Value Measurements &#151; Various inputs are used in determining the fair value</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of investments and derivatives, which are as follows:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=Frutiger-Roman,Arial,Helvetica,sans-serif>&#149; </FONT><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Level 1 &#151; price quotations in active markets/exchanges for identical assets</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and liabilities</FONT><BR>
<FONT color=#231f20 size=2 face=Frutiger-Roman,Arial,Helvetica,sans-serif>&#149; </FONT><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Level 2 &#151; other observable inputs (including, but not limited to: quoted</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>prices for similar assets or liabilities in markets that are active, quoted prices</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>for identical or similar assets or liabilities in markets that are not active,</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>inputs other than quoted prices that are observable for the assets or liabili-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ties (such as interest rates, yield curves, volatilities, prepayment speeds, loss</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>severities, credit risks and default rates) or other market-corroborated inputs)</FONT><BR>
<FONT color=#231f20 size=2 face=Frutiger-Roman,Arial,Helvetica,sans-serif>&#149; </FONT><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Level 3 &#151; unobservable inputs based on the best information available in</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the circumstances, to the extent observable inputs are not available (includ-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ing the Fund's own assumptions used in determining the fair value of invest-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments and derivatives)</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The inputs or methodologies used for valuing securities are not necessarily an</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>indication of the risk associated with investing in those securities. For information</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>about the Fund's policy regarding valuation of investments and other significant</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounting policies, please refer to Note 1 of the Notes to Financial Statements.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The following tables summarize the inputs used as of October 31, 2010 in deter-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>mining the fair valuation of the Fund's investments and derivatives:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="23%"></TD>
     <TD width="25%"></TD>
     <TD width="14%"></TD>
     <TD width="14%"></TD>
     <TD width="21%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Valuation Inputs</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 1</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 2</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 3</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Assets:</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments in Securities:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Long Term</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1</FONT></SUP>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 626,294,818</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$626,294,818</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Short-Term</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Securities</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 637,963,412</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$637,963,412</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See above Schedule of Investments for values in each industry.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="24%"></TD>
     <TD width="21%"></TD>
     <TD width="19%"></TD>
     <TD width="12%"></TD>
     <TD width="22%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=5 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Derivative Financial Instruments</FONT></B><B><SUP><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2</FONT></SUP></B></TD></TR>
<TR>
     <TD colSpan=5>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Valuation Inputs</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 1</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 2</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Level 3</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Liabilities:</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Equity</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>contracts</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(4,719,553)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(6,499,954)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (11,219,507)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Derivative financial instruments are options, which are shown at value.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>8 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
<HR align=center SIZE=2 width="100%" noShade>
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<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="80%"></TD>
     <TD width="19%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Statement of Assets and Liabilities</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>October 31, 2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Assets</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments at value &#151; unaffiliated (cost &#151; $648,141,680)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 626,294,818</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments at value &#151; affiliated (cost &#151; $11,668,594)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,668,594</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Cash pledged as collateral for options written</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,157,055</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Foreign currency at value (cost &#151; $9,143)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,156</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments sold receivable</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>37,919,538</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividends receivable &#151; unaffiliated</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,093,711</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Prepaid expenses</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>18,490</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total assets</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>684,159,362</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Liabilities</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options written, at value (premiums received &#151; $8,684,558)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,219,507</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments purchased payable</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>36,578,098</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investment advisory fees payable</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>452,793</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Other affiliates payable</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,909</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer's and Directors' fees payable</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,112</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Other accrued expenses payable</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55,052</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total liabilities</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>48,310,471</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 635,848,891</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets Consist of</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Paid-in capital</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 806,660,593</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Accumulated net realized loss</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(146,427,904)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net unrealized appreciation/depreciation</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(24,383,798)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 635,848,891</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Asset Value</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Based on net assets of $635,848,891 and 43,754,282 shares outstanding, 200 million shares authorized, $0.10 par value</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14.53</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>9</FONT></P>
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<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="60%"></TD>
     <TD width="39%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Statement of Operations</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Year Ended October 31, 2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Income</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividends</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 19,459,528</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Foreign taxes withheld</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(119,348)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Income &#151; affiliated</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>30,414</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total income</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19,370,594</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Expenses</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investment advisory</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,366,942</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Accounting services</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>136,047</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Transfer agent</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>75,734</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer and Directors</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>65,465</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Professional</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>62,240</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Custodian</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>56,908</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Printing</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>56,630</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Registration</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>14,908</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Miscellaneous</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>59,142</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total expenses</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,894,016</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Less fees waived by advisor</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(16,050)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total expenses after fees waived</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>5,877,966</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>13,492,628</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Realized and Unrealized Gain (Loss)</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net realized gain from:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>7,051,577</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options written</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,675,954</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>42,727,531</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net change in unrealized appreciation/depreciation on:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>38,899,803</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options written</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(5,351,262)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Foreign currency transactions</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(253)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>33,548,288</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total realized and unrealized gain</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>76,275,819</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Increase in Net Assets Resulting from Operations</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 89,768,447</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>10 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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     <TD width="27%"></TD>
     <TD width="11%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Statements of Changes in Net Assets</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Year Ended October 31,</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Increase (Decrease) in Net Assets:</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2010</FONT></B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2009</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Operations</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 13,492,628</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 12,296,699</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net realized gain (loss)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>42,727,531</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(51,444,075)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net change in unrealized appreciation/depreciation</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>33,548,288</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>148,309,201</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net increase in net assets resulting from operations</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>89,768,447</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>109,161,825</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Dividends and Distributions to Shareholders From</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(13,492,628)</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(12,510,205)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net realized gain</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(57,426,073)</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(50,728,478)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Tax return of capital</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(12,998,957)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(19,660,314)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Decrease in net assets resulting from dividends and distributions to shareholders</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(83,917,658)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(82,898,997)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital Share Transactions</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net proceeds from the issuance of shares due to reorganization</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>420,968,153</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Reinvestment of dividends and distributions</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,536,388</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3,234,875</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net increase in net assets derived from capital share transactions</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>11,536,388</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>424,203,028</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total increase in net assets</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17,387,177</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>450,465,856</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Beginning of year</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>618,461,714</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>167,995,858</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>End of year</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 635,848,891</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 618,461,714</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>11</FONT></P>
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     <TD align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Financial Highlights</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
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     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Period</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
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     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>January 1,</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
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     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2008 to</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Year Ended October 31,</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Year Ended December 31,</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>October 31,</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2009</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2008</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2007</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2006</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2005</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#cfd4e7 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Per Share Operating Performance</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#cfd4e7 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net asset value, beginning of period</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14.40</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 13.78</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 21.36</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 22.91</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 20.31</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 20.76</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1</FONT></SUP>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.31</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.29</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.23</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.31</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.37</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.46</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net realized and unrealized gain (loss)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.76</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.27</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(6.36)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.58</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3.69</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.29</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net increase (decrease) from investment operations</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.07</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.56</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(6.13)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.89</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4.06</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.75</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividends and distributions from:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.31)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.29)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.23)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.34)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.33)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.47)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net realized gain</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.33)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.19)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.62)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(2.10)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.13)</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.73)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Tax return of capital</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.30)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.46)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(0.60)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total dividends and distributions</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.94)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.94)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.45)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(2.44)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.46)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1.20)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net asset value, end of period</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14.53</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 14.40</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 13.78</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 21.36</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 22.91</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 20.31</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Market price, end of period</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 15.03</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 13.76</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 12.37</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 20.06</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 20.41</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 17.21</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Investment Return</FONT></B><B><SUP><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2</FONT></SUP></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Based on net asset value</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>15.22%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>22.01%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(29.46)%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4.79%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>21.70%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4.69%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Based on market price</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>24.73%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>29.88%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(32.58)%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10.47%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>27.95%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.52%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Ratios to Average Net Assets</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total expenses</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.93%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.95%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.10%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.96%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3.54%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.96%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total expenses after fees waived and paid indirectly</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.93%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.95%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.10%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.96%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3.54%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.96%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total expenses after fees waived and paid indirectly and</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>excluding interest expense</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.93%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.95%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.01%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.19%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.42%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.47%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net investment income</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.14%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.16%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.46%</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.36%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1.75%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 3px double" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2.28%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Supplemental Data</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net assets, end of period (000)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 635,849</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 618,462</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 167,996</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 260,385</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 279,272</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 260,638</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Borrowings outstanding, end of period (000)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 100,000</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 109,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Average borrowings outstanding, during the period (000)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 38,788</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 107,504</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 109,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Portfolio turnover</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>210%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>138%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>45%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>63%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>38%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>61%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Asset coverage, end of period per $1,000</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 3,793</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 3,391</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Based on average shares outstanding.</FONT><BR>
<SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>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 appli-</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.</FONT><BR>
<SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Aggregate total investment return.</FONT><BR>
<SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>4 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Annualized.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Notes to Financial Statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>12 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Notes to Financial Statements</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>1. Organization and Significant Accounting Policies:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. (&#147;CII&#148;) is registered</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>under the Investment Company Act of 1940, as amended (the &#147;1940</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Act&#148;), as a diversified, closed-end management investment company. The</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund is organized as a Maryland corporation. The Fund's financial state-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments are prepared in conformity with accounting principles generally</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accepted in the United States of America ("US GAAP"), which may</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>require management to make estimates and assumptions that affect the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reported amounts and disclosures in the financial statements. Actual</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>results could differ from those estimates. The Board of Directors of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund, are referred to throughout this report as the &#147;Board of Directors&#148; or</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the &#147;Board.&#148; The Fund determines and makes available for publication</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the net asset value of its Common Shares on a daily basis.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Reorganization: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board and the shareholders of each of BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Enhanced Equity Yield Fund, Inc. (&#147;EEF&#148;), BlackRock Enhanced Equity</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Yield and Premium Fund, Inc. (&#147;ECV&#148;) (the &#147;Target Funds&#148;) and CII</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>approved the reorganization of each Target Fund into CII (the &#147;Reorgan-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>izations&#148;). The Reorganizations were tax-free events and were effective as</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the opening for business of the New York Stock Exchange (&#147;NYSE&#148;) on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>November 3, 2008.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
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     <TD width="48%"></TD>
     <TD width="51%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Target Funds</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Acquiring Fund</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>EEF</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>CII</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ECV</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>CII</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Under the agreement and plan of reorganization between each Target</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund and CII, the shares of each Target Fund (&#147;Target Fund Shares&#148;)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>were exchanged for CII shares. The conversion ratios for the Target Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Shares were as follows:</FONT></P>
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     <TD width="46%"></TD>
     <TD width="53%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>EEF/CII</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.80653563</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ECV/CII</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0.81144752</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The net assets of CII before and after the Reorganizations and CII</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shares issued and Target Fund Shares redeemed in connection with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Reorganizations were as follows:</FONT></P>
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     <TD width="16%"></TD>
     <TD width="24%"></TD>
     <TD width="20%"></TD>
     <TD width="15%"></TD>
     <TD width="22%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Acquiring</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>After the</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Prior to the</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Target Funds</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>&nbsp;&nbsp;&nbsp; Reorganizations&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reorganizations</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Issued</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Shares Redeemed</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>CII</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$591,399,963</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$170,431,810</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>30,542,706</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>37,766,622</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Included in the net assets acquired by CII were the following</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>components:</FONT></P>
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<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="19%"></TD>
     <TD width="22%"></TD>
     <TD width="20%"></TD>
     <TD width="19%"></TD>
     <TD width="18%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Paid-in</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Realized</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Unrealized</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Target Funds</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Loss</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Depreciation</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Assets</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>EEF</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$329,483,362</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(16,478,636)</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(80,066,510)</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$232,938,216</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ECV</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$270,207,354</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(15,306,983)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(66,870,434)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$188,029,937</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The following is a summary of significant accounting policies followed by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Valuation: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund fair values its financial instruments at market value</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>using independent dealers or pricing services under policies approved</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by the Board. Equity investments traded on a recognized securities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>exchange or the NASDAQ Global Market System are valued at the last</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reported sale price that day or the NASDAQ official closing price, if</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>applicable. For equity investments traded on more than one exchange,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the last reported sale price on the exchange where the stock is primarily</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>traded is used. Equity investments traded on a recognized exchange for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>which there were no sales on that day are valued at the last available</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>bid (long positions) or ask (short positions) price. If no bid or ask price</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>is available, the prior day&#146;s price will be used, unless it is determined</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>that such prior day&#146;s price no longer reflects the fair value of the security.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investments in open-end investment companies are valued at net asset</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>value each business day. Short-term securities with remaining maturities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of 60 days or less may be valued at amortized cost, which approximates</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>fair value.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Securities and other assets and liabilities denominated in foreign curren-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cies are translated into US dollars using exchange rates determined as</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the close of business on the New York Stock Exchange (&#147;NYSE&#148;).</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Foreign currency exchange contracts are valued at the mean between</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the bid and ask prices and are determined as of the close of business</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on the NYSE. Interpolated values are derived when the settlement date</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the contract is an interim date for which quotations are not available.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Exchange-traded options are valued at the mean between the last bid</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and ask prices at the close of the options market in which the options</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>trade. An exchange-traded option for which there is no mean price is val-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ued at the last bid (long positions) or ask (short positions) price. If no</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>bid or ask price is available, the prior day&#146;s price will be used, unless it</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>is determined that the prior day&#146;s price no longer reflects the fair value of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the option. Over-the-counter (&#147;OTC&#148;) options are valued by an independ-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ent pricing service using a mathematical model which incorporates a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>number of market data factors, such as the trades and prices of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>underlying instruments.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In the event that application of these methods of valuation results in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>a price for an investment which is deemed not to be representative of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the market value of such investment or is not available, the investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>will be valued in accordance with a policy approved by the Board as</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reflecting fair value (&#147;Fair Value Assets&#148;). When determining the price for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fair Value Assets, the investment advisor and/or the sub-advisor seeks</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to determine the price that the Fund might reasonably expect to receive</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from the current sale of that asset in an arm&#146;s-length transaction. Fair</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>value determinations shall be based upon all available factors that the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investment advisor and/or sub-advisor deems relevant. The pricing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of all Fair Value Assets is subsequently reported to the Board or a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>committee thereof.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Generally, trading in foreign instruments is substantially completed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>each day at various times prior to the close of business on the NYSE.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Occasionally, events affecting the values of such instruments may occur</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>between the foreign market close and the close of business on the</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>13</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Notes to Financial Statements (continued)</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>NYSE that may not be reflected in the computation of the Fund's net</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>assets. If events (for example, a company announcement, market volatil-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ity or a natural disaster) occur during such periods that are expected to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>materially affect the value of such instruments, those instruments may</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>be Fair Value Assets and be valued at their fair values, as determined in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>good faith by the investment advisor using a pricing service and/or</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>policies approved by the Board. Each business day, the Fund uses a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pricing service to assist with the valuation of certain foreign exchange-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>traded equity securities and foreign exchange-traded and OTC options</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(the &#147;Systematic Fair Value Price&#148;). Using current market factors, the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Systematic Fair Value Price is designed to value such foreign securities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and foreign options at fair value as of the close of business on the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>NYSE, which follows the close of the local markets.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Foreign Currency Transactions: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund's books and records are main-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tained in US dollars. Purchases and sales of investment securities are</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>recorded at the rates of exchange prevailing on the date the transactions</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>are entered into. Generally, when the US dollar rises in value against a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>foreign currency, the Fund's investments denominated in that currency</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>will lose value because its currency is worth fewer US dollars; the oppo-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>site effect occurs if the US dollar falls in relative value.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund reports foreign currency related transactions as components of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>realized gain (loss) for financial reporting purposes, whereas such com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ponents are treated as ordinary income for federal income tax purposes.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Segregation and Collateralization: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In cases in which the 1940 Act and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the interpretive positions of the Securities and Exchange Commission</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(&#147;SEC&#148;) require that the Fund either delivers collateral or segregates</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>assets in connection with certain investments (e.g., foreign currency</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>exchange contracts and options written), the Fund will, consistent with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>SEC rules and/or certain interpretive letters issued by the SEC, segregate</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>collateral or designate on its books and records cash or other liquid</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>securities having a market value at least equal to the amount that would</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>otherwise be required to be physically segregated. Furthermore, based</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on requirements and agreements with certain exchanges and third party</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>broker-dealers, each party has requirements to deliver/deposit securities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>as collateral for certain investments.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Investment Transactions and Investment Income: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For financial reporting</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>purposes, investment transactions are recorded on the dates the trans-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>actions are entered into (the trade dates). Realized gains and losses on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investment transactions are determined on the identified cost basis.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividend income is recorded on the ex-dividend dates. Dividends from</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>foreign securities where the ex-dividend date may have passed are sub-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>sequently recorded when the Fund has determined the ex-dividend date.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Under the applicable foreign tax laws, a withholding tax at various rates</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may be imposed on capital gains, dividends and interest. Interest</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>income, including amortization and accretion of premiums and discounts</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on debt securities, is recognized on the accrual basis.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Dividends and Distributions: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividends and distributions paid by the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund are recorded on the ex-dividend dates. Subject to the Fund&#146;s level</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>distribution plan, the Fund intends to make monthly cash dividends</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and/or distributions to shareholders, which may consist of net invest-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment income, net options premium and net realized and unrealized</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>gains on investments. The portion of dividends and distributions that</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>exceeds the Fund's current and accumulated earnings and profits,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>which are measured on a tax basis, may be treated as a tax return of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>capital. The character of dividends and distributions are determined in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accordance with federal income tax regulations, which may differ from</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>US GAAP.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Income Taxes: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>It is the Fund's policy to comply with the requirements</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Internal Revenue Code of 1986, as amended, applicable to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>regulated investment companies and to distribute substantially all of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>its taxable income to its shareholders. Therefore, no federal income tax</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>provision is required.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund files US federal and various state and local tax returns.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>No income tax returns are currently under examination. The statute of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>limitations on the Fund's US federal tax returns remains open for the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>year ended December 31, 2007, the period ended October 31, 2008</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and the two years ended October 31, 2010. The statutes of limitations</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on the Fund's state and local tax returns may remain open for an addi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tional year depending upon the jurisdiction. There are no uncertain tax</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>positions that require recognition of a tax liability.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Other: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Expenses directly related to the Fund are charged to that Fund.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Other operating expenses shared by several funds are pro rated among</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>those funds on the basis of relative net assets or other appropriate</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>methods. The Fund has an arrangement with the custodian whereby fees</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may be reduced by credits earned on uninvested cash balances, which</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>if applicable are shown as fees paid indirectly in the Statement of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Operations. The custodian imposes fees on overdrawn cash balances,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>which can be offset by accumulated credits earned or may result in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>additional custody charges.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>2. Derivative Financial Instruments:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund engages in various portfolio investment strategies using deriva-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tive contracts both to increase the return of the Fund and to economi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cally hedge, or protect, its exposure to certain risks such as equity risk or</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>foreign currency exchange rate risk. These contracts may be transacted</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on an exchange or OTC.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Losses may arise if the value of the contract decreases due to an unfa-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>vorable change in the market rates or values of the underlying instru-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment or if the counterparty does not perform under the contract. The</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund's maximum risk of loss from counterparty credit risk on OTC</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>derivatives is generally the aggregate unrealized gain netted against any</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>collateral pledged by/posted to the counterparty. For OTC options pur-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>chased, the Fund bears the risk of loss in the amount of the premiums</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>14 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Notes to Financial Statements (continued)</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>paid plus the positive change in market values net of any collateral</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>received on the options should the counterparty fail to perform under</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the contracts. Options written by the Fund do not give rise to counter-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>party credit risk, as options written obligate the Fund to perform and not</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the counterparty. Counterparty risk related to exchange-traded options is</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>deemed to be minimal due to the protection against defaults provided</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by the exchange on which these contracts trade.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund may mitigate counterparty risk by procuring collateral and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>through netting provisions included within an International Swaps and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Derivatives Association, Inc. (&#147;ISDA&#148;) Master Agreement implemented</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>between the Fund and each of its respective counterparties. The ISDA</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Master Agreement allows the Fund to offset with each separate counter-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>party certain derivative financial instrument&#146;s payables and/or receiv-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ables with collateral held. The amount of collateral moved to/from</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>applicable counterparties is generally based upon minimum transfer</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>amounts of up to $500,000. To the extent amounts due to the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from its counterparties are not fully collateralized contractually or other-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>wise, the Fund bears the risk of loss from counterparty non-performance.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>See Note 1 &#147;Segregation and Collateralization&#148; for information with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>respect to collateral practices. In addition, the Fund manages counter-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>party risk by entering into agreements only with counterparties that it</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>believes have the financial resources to honor its obligations and by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>monitoring the financial stability of those counterparties.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Certain ISDA Master Agreements allow counterparties to OTC derivatives</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to terminate derivative contracts prior to maturity in the event the Fund's</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>net assets decline by a stated percentage or the Fund fails to meet the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>terms of its ISDA Master Agreements, which would cause the Fund to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accelerate payment of any net liability owed to the counterparty.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Options: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund purchases and writes call and put options to increase</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or decrease its exposure to underlying instruments (including equity risk</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and/or interest rate risk) and/or, in the case of options written, to gener-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ate gains from options premiums. A call option gives the purchaser of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the option the right (but not the obligation) to buy, and obligates the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>seller to sell (when the option is exercised), the underlying instrument at</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the exercise price at any time or at a specified time during the option</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>period. A put option gives the holder the right to sell and obligates the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>writer to buy the underlying instrument at the exercise price at any time</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or at a specified time during the option period. When the Fund pur-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>chases (writes) an option, an amount equal to the premium paid</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(received) by the Fund is reflected as an asset (liability). The amount of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the asset (liability) is subsequently marked-to-market to reflect the cur-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>rent market value of the option purchased (written). When an instrument</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>is purchased or sold through an exercise of an option, the related pre-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>mium paid (or received) is added to (or deducted from) the basis of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>instrument acquired or deducted from (or added to) the proceeds of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>instrument sold. When an option expires (or the Fund enters into a clos-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ing transaction), the Fund realizes a gain or loss on the option to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>extent of the premiums received or paid (or gain or loss to the extent the</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cost of the closing transaction exceeds the premiums received or paid).</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>When the Fund writes a call option, such option is &#147;covered,&#148; meaning</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>that the Fund holds the underlying instrument subject to being called by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the option counterparty. When the Fund writes a put option, such option</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>is covered by cash in an amount sufficient to cover the obligation.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund also purchases or sells listed or OTC foreign currency options,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>foreign currency futures and related options on foreign currency futures</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>as a short or long hedge against possible variations in foreign exchange</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>rates or to gain exposure to foreign currencies. When foreign currency is</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>purchased or sold through an exercise of a foreign currency option, the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>related premium paid (or received) is added to (or deducted from) the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>basis of the foreign currency acquired or deducted from (or added to)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the proceeds of the foreign currency sold. Such transactions may be</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>effected with respect to hedges on non-US dollar denominated instru-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments owned by the Fund but not yet delivered, or committed or antici-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pated to be purchased by the Fund.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In purchasing and writing options, the Fund bears the risk of an unfavor-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>able change in the value of the underlying instrument or the risk that</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund may not be able to enter into a closing transaction due to an</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>illiquid market. Exercise of an option written could result in the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>purchasing or selling a security at a price different from the current</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>market value.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="25%"></TD>
     <TD width="54%"></TD>
     <TD width="19%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Derivative Instruments Categorized by Risk Exposure:</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fair Values of Derivative Instruments as of October 31, 2010</FONT></B></TD></TR>
<TR>
     <TD colSpan=3>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Liability Derivatives</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Statement</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>of Assets and</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Liabilities</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Location</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Equity contracts</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options written at value</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$11,219,507</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>The Effect of Derivative Instruments on the Statement of Operations</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Year Ended October 31, 2010</FONT></B></TD></TR>
<TR>
     <TD colSpan=3>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Realized Gain from</FONT></B></TD></TR>
<TR>
     <TD colSpan=3>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Options*</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Equity contracts</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$35,670,718</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>* Includes options purchased which are shown in the net realized gain (loss) from</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investments</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Change in Unrealized Appreciation/Depreciation on</FONT></B></TD></TR>
<TR>
     <TD colSpan=3>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Options</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Equity contracts</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ (5,351,262)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For the year ended October 31, 2010, the average quarterly balance of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>outstanding derivative financial instruments was as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="70%"></TD>
     <TD width="29%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options:</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Average number of contracts purchased</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>400</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Average number of contracts written</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>134,012</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Average notional value of contracts purchased</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 1,240,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Average notional value of contracts written</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$342,941,611</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010 15</FONT></P>
<HR align=center SIZE=2 width="100%" noShade>
<DIV style="PAGE-BREAK-BEFORE: always"></DIV>

<!--$$/page=-->
<A name="page_17"></A><BR>
<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Notes to Financial Statements (continued)</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>3. Investment Advisory Agreement and Other Transactions</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>with Affiliates:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The PNC Financial Services Group, Inc. ("PNC"), Bank of America</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Corporation ("BAC") and Barclays Bank PLC ("Barclays") are the largest</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>stockholders of BlackRock, Inc. ("BlackRock"). Due to the ownership</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>structure, PNC is an affiliate of the Fund for 1940 Act purposes, but BAC</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Barclays are not.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund entered into an Investment Advisory Agreement with BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Advisors, LLC (the &#147;Manager&#148;), the Fund's investment advisor, an indirect,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>wholly owned subsidiary of BlackRock, to provide investment advisory</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and administration services. The Manager is responsible for the manage-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment of the Fund's portfolio and provides the necessary personnel, facil-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ities, equipment and certain other services necessary to the operations</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Fund. For such services, the Fund pays the Manager a monthly fee</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>at an annual rate of 0.85% of an aggregate of the Fund&#146;s average daily</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>net assets and the proceeds of borrowings used for leverage, if any.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Manager voluntarily agreed to waive its investment advisory fees by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the amount of investment advisory fees the Fund pays to the Manager</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>indirectly through its investment in affiliated money market funds,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>however the Manager does not waive its investment advisory fees by the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>amount of investment advisory fees paid through the Fund's investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in other affiliated investment companies, if any. This amount is included</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in fees waived by advisor in the Statement of Operations.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Manager entered into a sub-advisory agreement with BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investment Management, LLC (&#147;BIM&#148;), an affiliate of the Manager.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Manager pays BIM for services it provides, a monthly fee that is</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>a percentage of the investment advisory fees paid by the Fund to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Manager.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For the year ended October 31, 2010, the Fund reimbursed the Manager</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$12,017 for certain accounting services, which is included in accounting</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>services in the Statement of Operations.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Certain officers and/or directors of the Fund are officers and/or directors</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of BlackRock or its affiliates. The Fund reimburses the Manager for com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pensation paid to the Fund's Chief Compliance Officer.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>4. Investments:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Purchases and sales of investments, excluding short-term securities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>for the year ended October 31, 2010, were $1,295,938,902 and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$1,294,408,817, respectively.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Transactions in options written for the year ended October 31, 2010,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>were as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="48%"></TD>
     <TD width="24%"></TD>
     <TD width="9%"></TD>
     <TD width="18%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Calls</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Premiums</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Contracts</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Received</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Outstanding options, beginning</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 2px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of year</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>117,087</FONT>&nbsp;</TD>
     <TD colSpan=2 align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 9,193,459</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options written</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>979,480</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>66,951,904</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options excised</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(442,274)</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(28,919,927)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options closed</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(133,098)</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(10,106,952)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Options expired</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(392,389)</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(28,433,926)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Outstanding options, end of year</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>128,806</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 8,684,558</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>As of October 31, 2010, the value of portfolio securities subject to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>covered call options written was $345,087,420.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>5. Market and Credit Risk:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In the normal course of business, the Fund invests in securities and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>enters into transactions where risks exist due to fluctuations in the mar-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ket (market risk) or failure of the issuer of a security to meet all its obli-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>gations (issuer credit risk). The value of securities held by the Fund may</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>decline in response to certain events, including those directly involving</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the issuers whose securities are owned by the Fund; conditions affecting</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the general economy; overall market changes; local, regional or global</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>political, social or economic instability; and currency and interest rate</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and price fluctuations. Similar to issuer credit risk, the Fund may be</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>exposed to counterparty credit risk, or the risk that an entity with which</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund has unsettled or open transactions may fail to or be unable to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>perform on its commitments. The Fund manages counterparty credit risk</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by entering into transactions only with counterparties that it believes</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>have the financial resources to honor their obligations and by monitoring</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the financial stability of those counterparties. Financial assets, which</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>potentially expose the Fund to market, issuer and counterparty credit</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>risks, consist principally of financial instruments and receivables due</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from counterparties. The extent of the Fund's exposure to market, issuer</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and counterparty credit risks with respect to these financial assets is</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>generally approximated by their value recorded in the Fund's Statement</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of Assets and Liabilities, less any collateral held by the Fund.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>6. Capital Share Transactions:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund is authorized to issue 200 million of $0.10 par value shares,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>all of which were initially classified as Common Shares.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>16 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<A name="page_18"></A><BR>
<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Notes to Financial Statements (concluded)</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Common Shares</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>At October 31, 2010, 24,887 shares were owned by an affiliate of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Manager.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>For the years ended October 31, 2010 and 2009, shares issued and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>outstanding increased by 800,970 and 221,870, respectively, as a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>result of dividend reinvestment.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>7. Income Tax Information:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The tax character of distributions paid during the fiscal years ended</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>October 31, 2010 and October 31, 2009, was as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="53%"></TD>
     <TD width="46%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Ordinary income</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2010</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 70,918,701</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2009</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>52,962,484</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Long-term capital gains</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2010</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2009</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10,276,199</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Tax return of capital</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2010</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>12,998,957</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2009</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>19,660,314</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Total distributions</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2010</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 83,917,658</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>10/31/2009</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 82,898,997</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>As of October 31, 2010 the tax components of accumulated losses were</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>as follows:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="55%"></TD>
     <TD width="44%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Capital loss carryforwards</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(108,828,056)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Net unrealized losses*</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(61,983,646)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$(170,811,702)</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>* The differences between book-basis and tax-basis net unrealized losses were</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>attributable primarily to the tax deferral of losses on wash sales.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>As of October 31, 2010, the Fund had capital loss carryforwards</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>available to offset future realized capital gains through the indicated</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>expiration dates:</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="51%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Expires October 31,</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2016</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 26,706,998</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2017</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>79,505,861</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2018</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2,615,197</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$ 108,828,056</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>8. Subsequent Events:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Management's evaluation of the impact of all subsequent events on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund's financial statements was completed through the date the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial statements were issued and has determined that there were</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>no subsequent events requiring adjustment or disclosures in the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial statements.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>17</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Report of Independent Registered Public Accounting Firm</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>To the Shareholders and Board of Directors of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc.:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>We have audited the accompanying statement of assets and liabilities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of BlackRock Enhanced Capital and Income Fund, Inc. (the &#147;Fund&#148;),</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>including the schedule of investments, as of October 31, 2010, and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the related statement of operations for the year then ended, the state-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments of changes in net assets for each of the two years in the period</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>then ended, and the financial highlights for the year ended October 31,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2010, for the year ended October 31, 2009, for the period January 1,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2008 to October 31, 2008, and for each of the three years in the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>period ended December 31, 2007. These financial statements and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial highlights are the responsibility of the Fund&#146;s management.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Our responsibility is to express an opinion on these financial statements</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and financial highlights based on our audits.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>We conducted our audits in accordance with the standards of the Public</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Company Accounting Oversight Board (United States). Those standards</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>require that we plan and perform the audit to obtain reasonable assur-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ance about whether the financial statements and financial highlights</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>are free of material misstatement. The Fund is not required to have, nor</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>were we engaged to perform, an audit of its internal control over finan-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cial reporting. Our audits included consideration of internal control over</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial reporting as a basis for designing audit procedures that are</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>appropriate in the circumstances, but not for the purpose of expressing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>an opinion on the effectiveness of the Fund&#146;s internal control over</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial reporting. Accordingly, we express no such opinion. An audit</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>also includes examining, on a test basis, evidence supporting the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>amounts and disclosures in the financial statements, assessing the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounting principles used and significant estimates made by manage-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment, as well as evaluating the overall financial statement presentation.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Our procedures included confirmation of securities owned as of October</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>31, 2010, by correspondence with the custodian and brokers; where</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>replies were not received from brokers, we performed other auditing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>procedures. We believe that our audits provide a reasonable basis for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>our opinion.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In our opinion, the financial statements and financial highlights referred</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to above present fairly, in all material respects, the financial position of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. as of October 31,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2010, the results of its operations for the year then ended, the changes</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in its net assets for each of the two years in the period then ended, and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the financial highlights for the year ended October 31, 2010, for the year</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ended October 31, 2009, for the period January 1, 2008 to October 31,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2008, and for each of the three years in the period ended December</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>31, 2007, in conformity with accounting principles generally accepted</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in the United States of America.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Deloitte &amp; Touche LLP</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Princeton, New Jersey</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>December 23, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Important Tax Information (Unaudited)</FONT></B><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The following information is provided with respect to the ordinary income distributions paid by BlackRock Enhanced Capital and Income Fund, Inc.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>during the taxable period ended October 31, 2010.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="55%"></TD>
     <TD width="18%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="7%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Payable Date</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>12/31/09</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>3/31/10</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>6/30/10</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>9/30/10</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Qualified Dividend Income for Individuals &#134;</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>17.01%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>28.47%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>28.47%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>28.47%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dividends Qualifying for the Dividends Received Deduction for Corporations &#134;</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>15.75%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>26.62%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>26.62%</FONT>&nbsp;</TD>
     <TD align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>26.62%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Short-Term Capital Gain Dividends for Non-U.S. Residents&#134;&#134;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35.06%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100.00%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100.00%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100.00%</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#134; The Fund hereby designates the percentages indicated above or the maximum amount allowable by law.</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Represents the portion of taxable ordinary income dividends eligible for exemption from U.S. withholding tax for nonresident aliens and foreign corporations.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>18 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
<HR align=center SIZE=2 width="100%" noShade>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Disclosure of Investment Advisory Agreement and Sub-Advisory Agreement</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board of Directors (the &#147;Board,&#148; the members of which are referred</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to as &#147;Board Members&#148;) of BlackRock Enhanced Capital and Income</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund, Inc. (the &#147;Fund&#148;) met on April 8, 2010 and May 13 &#150; 14, 2010 to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>consider the approval of the Fund&#146;s investment advisory agreement (the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#147;Advisory Agreement&#148;) with BlackRock Advisors, LLC (the &#147;Manager&#148;), the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund&#146;s investment advisor. The Board also considered the approval of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>sub-advisory agreements (collectively, the &#147;Sub-Advisory Agreements&#148;)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>between the Manager and BlackRock Financial Management and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Investment Management, LLC (the &#147;Sub-Advisors&#148;), with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>respect to the Fund. The Manager and the Sub-Advisors are referred to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>herein as &#147;BlackRock.&#148; The Advisory Agreement and the Sub-Advisory</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agreements are referred to herein as the &#147;Agreements.&#148;</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>Activities and Composition of the Board</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board consists of ten individuals, eight of whom are not &#147;interested</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>persons&#148; of the Fund as defined in the Investment Company Act of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1940 (the &#147;1940 Act&#148;) (the &#147;Independent Board Members&#148;). The Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Members are responsible for the oversight of the operations of the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and perform the various duties imposed on the directors of investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>companies by the 1940 Act. The Independent Board Members have</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>retained independent legal counsel to assist them in connection with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>their duties. The Chairman of the Board is an Independent Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Member. The Board has established five standing committees: an Audit</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee, a Governance and Nominating Committee, a Compliance</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee, a Performance Oversight Committee and an Executive</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee, each of which is composed of Independent Board Members</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(except for the Executive Committee, which also has one interested</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board Member) and is chaired by an Independent Board Member.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board also has one </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCndItal,Arial,Helvetica,sans-serif>ad hoc </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>committee, the Joint Product Pricing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee, which consists of Independent Board Members and the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>directors/trustees of the boards of certain other BlackRock-managed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>funds, who are not &#147;interested persons&#148; of their respective funds.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>The Agreements</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pursuant to the 1940 Act, the Board is required to consider the cont-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>inuation of the Agreements on an annual basis. In connection with this</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>process, the Board assessed, among other things, the nature, scope</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and quality of the services provided to the Fund by the personnel of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock and its affiliates, including investment management, admin-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>istrative and shareholder services, oversight of fund accounting and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>custody, marketing services and assistance in meeting applicable legal</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and regulatory requirements.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>From time to time throughout the year, the Board, acting directly and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>through its committees, considered at each of its meetings factors</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>that are relevant to its annual consideration of the renewal of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agreements, including the services and support provided by BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to the Fund and its shareholders. Among the matters the Board consid-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ered were: (a) investment performance for one-, three- and five-year</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>periods, as applicable, against peer funds, and applicable benchmarks,</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>if any, as well as senior management&#146;s and portfolio managers&#146; analysis</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the reasons for any over performance or underperformance against</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>its peers and/or benchmark, as applicable; (b) fees, including advisory</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and other amounts paid to BlackRock and its affiliates by the Fund for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>services such as call center and fund accounting; (c) Fund operating</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>expenses; (d) the resources devoted to and compliance reports relating</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to the Fund&#146;s investment objective, policies and restrictions; (e) the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund&#146;s compliance with its Code of Ethics and compliance policies</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and procedures; (f) the nature, cost and character of non-investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>management services provided by BlackRock and its affiliates;</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(g) BlackRock&#146;s and other service providers&#146; internal controls;</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(h) BlackRock&#146;s implementation of the proxy voting policies approved</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by the Board; (i) the use of brokerage commissions and execution</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>quality of portfolio transactions; (j) BlackRock&#146;s implementation of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund&#146;s valuation and liquidity procedures; (k) an analysis of contractual</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and actual management fees for products with similar investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>objectives across the open-end fund, closed-end fund and institutional</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>account product channels, as applicable; and (l) periodic updates on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s business.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>Board Considerations in Approving the Agreements</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>The Approval Process: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Prior to the April 8, 2010 meeting, the Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>requested and received materials specifically relating to the Agreements</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board is engaged in a process with BlackRock to periodically review</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the nature and scope of the information provided to better assist its</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>deliberations. The materials provided in connection with the April meet-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ing included (a) information independently compiled and prepared by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Lipper, Inc. (&#147;Lipper&#148;) on Fund fees and expenses, and the investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>performance of the Fund as compared with a peer group of funds as</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>determined by Lipper (collectively, &#147;Peers&#148;); (b) information on the prof-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>itability of the Agreements to BlackRock and a discussion of fall-out</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>benefits to BlackRock and its affiliates and significant shareholders;</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(c) a general analysis provided by BlackRock concerning investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>advisory fees charged to other clients, such as institutional clients and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>open-end funds, under similar investment mandates; (d) the impact of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>economies of scale; (e) a summary of aggregate amounts paid by the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund to BlackRock and (f) if applicable, a comparison of management</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>fees to similar BlackRock closed-end funds, as classified by Lipper.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>At an in-person meeting held on April 8, 2010, the Board reviewed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>materials relating to its consideration of the Agreements. As a result</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the discussions that occurred during the April 8, 2010 meeting, the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board presented BlackRock with questions and requests for additional</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information and BlackRock responded to these requests with additional</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>written information in advance of the May 13 &#150; 14, 2010 Board meeting</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>At an in-person meeting held on May 13 &#150; 14, 2010, the Board, in-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cluding the Independent Board Members, unanimously approved the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>continuation of the Advisory Agreement between the Manager and the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund and the Sub-Advisory Agreements between the Manager and the</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>19</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Disclosure of Investment Advisory Agreement and Sub-Advisory Agreement (continued)</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Sub-Advisors with respect to the Fund, each for a one-year term ending</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>June 30, 2011. In approving the continuation of the Agreements, the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board considered: (a) the nature, extent and quality of the services pro-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>vided by BlackRock; (b) the investment performance of the Fund and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock; (c) the advisory fee and the cost of the services and profits</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to be realized by BlackRock and its affiliates from their relationship with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund; (d) economies of scale; and (e) other factors deemed relevant</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by the Board Members.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board also considered other matters it deemed important to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>approval process, such as services related to the valuation and pricing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of Fund portfolio holdings, direct and indirect benefits to BlackRock and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>its affiliates and significant shareholders from their relationship with the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund and advice from independent legal counsel with respect to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>review process and materials submitted for the Board&#146;s review. The Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>noted the willingness of BlackRock personnel to engage in open, candid</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>discussions with the Board. The Board did not identify any particular</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information as controlling, and each Board Member may have attributed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>different weights to the various items considered.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>A. Nature, Extent and Quality of the Services Provided by BlackRock:</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board, including the Independent Board Members, reviewed the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>nature, extent and quality of services provided by BlackRock, including</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the investment advisory services and the resulting performance of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund. Throughout the year, the Board compared Fund performance to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the performance of a comparable group of closed-end funds, and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the performance of a relevant benchmark, if any. The Board met with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s senior management personnel responsible for investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>operations, including the senior investment officers. The Board also</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reviewed the materials provided by the Fund&#146;s portfolio management</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>team discussing Fund performance and the Fund&#146;s investment objective,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>strategies and outlook.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board considered, among other factors, the number, education</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and experience of BlackRock&#146;s investment personnel generally and the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund&#146;s portfolio management team, investments by portfolio managers</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in the funds they manage, BlackRock&#146;s portfolio trading capabilities,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s use of technology, BlackRock&#146;s commitment to compliance,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s credit analysis capabilities, BlackRock&#146;s risk analysis capa-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>bilities and BlackRock&#146;s approach to training and retaining portfolio</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>managers and other research, advisory and management personnel. The</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board also reviewed a general description of BlackRock&#146;s compensation</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>structure with respect to the Fund&#146;s portfolio management team and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s ability to attract and retain high-quality talent.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In addition to advisory services, the Board considered the quality of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>administrative and non-investment advisory services provided to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund. BlackRock and its affiliates and significant shareholders provide</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund with certain administrative and other services (in addition to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>any such services provided to the Fund by third parties) and officers and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>other personnel as are necessary for the operations of the Fund. In</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>addition to investment advisory services, BlackRock and its affiliates</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>provide the Fund with other services, including (i) preparing disclosure</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>documents, such as the prospectus and the statement of additional</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information in connection with the initial public offering and periodic</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shareholder reports; (ii) preparing communications with analysts to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>support secondary market trading of the Fund; (iii) assisting with daily</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounting and pricing; (iv) preparing periodic filings with regulators</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and stock exchanges; (v) overseeing and coordinating the activities of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>other service providers; (vi) organizing Board meetings and preparing</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the materials for such Board meetings; (vii) providing legal and com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pliance support; and (viii) performing other administrative functions</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>necessary for the operation of the Fund, such as tax reporting, fulfilling</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>regulatory filing requirements, and call center services. The Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reviewed the structure and duties of BlackRock&#146;s fund administration,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounting, legal and compliance departments and considered</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s policies and procedures for assuring compliance with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>applicable laws and regulations.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>B. The Investment Performance of the Fund and BlackRock: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>including the Independent Board Members, also reviewed and consid-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ered the performance history of the Fund. In preparation for the April 8,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2010 meeting, the Board was provided with reports, independently pre-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pared by Lipper, which included a comprehensive analysis of the Fund&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>performance. The Board also reviewed a narrative and statistical analysis</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Lipper data that was prepared by BlackRock, which analyzed vari-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ous factors that affect Lipper&#146;s rankings. In connection with its review,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Board received and reviewed information regarding the investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>performance of the Fund as compared to a representative group of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>similar funds as determined by Lipper and to all funds in the Fund&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>applicable Lipper category. The Board was provided with a description</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the methodology used by Lipper to select peer funds. The Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>regularly reviews the performance of the Fund throughout the year.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board noted that, in general, the Fund performed better than its</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Peers in that the Fund&#146;s performance was at or above the median of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>its Lipper Performance Universe in two of the one-, three- and five-year</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>periods reported.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>C. Consideration of the Advisory Fees and the Cost of the Services</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>and Profits to be Realized by BlackRock and its Affiliates from their</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Relationship with the Fund: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board, including the Independent</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board Members, reviewed the Fund&#146;s contractual advisory fee rate com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pared with the other funds in its Lipper category. It also compared the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund&#146;s total expenses, as well as actual management fees, to those of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>other funds in its Lipper category. The Board considered the services</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>provided and the fees charged by BlackRock to other types of clients</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with similar investment mandates, including separately managed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>institutional accounts.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>20 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Disclosure of Investment Advisory Agreement and Sub-Advisory Agreement (continued)</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board received and reviewed statements relating to BlackRock&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial condition and profitability with respect to the services it</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>provided the Fund. The Board was also provided with a profitability</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>analysis that detailed the revenues earned and the expenses incurred</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>by BlackRock for services provided to the Fund. The Board reviewed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s profitability with respect to the Fund and other funds the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board currently oversees for the year ended December 31, 2009 com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pared to available aggregate profitability data provided for the year</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ended December 31, 2008. The Board reviewed BlackRock&#146;s profitability</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with respect to other fund complexes managed by the Manager and/or</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>its affiliates. The Board reviewed BlackRock&#146;s assumptions and method-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ology of allocating expenses in the profitability analysis, noting the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>inherent limitations in allocating costs among various advisory products.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board recognized that profitability may be affected by numerous fac-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tors including, among other things, fee waivers and expense reimburse-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ments by the Manager, the types of funds managed, expense allocations</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and business mix, and the difficulty of comparing profitability as a result</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of those factors.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board noted that, in general, individual fund or product line prof-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>itability of other advisors is not publicly available. Nevertheless, to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>extent such information was available, the Board considered BlackRock&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>overall operating margin, in general, compared to the operating margin</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>for leading investment management firms whose operations include</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>advising closed-end funds, among other product types. That data indi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cates that operating margins for BlackRock with respect to its registered</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>funds are generally consistent with margins earned by similarly situated</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>publicly traded competitors. In addition, the Board considered, among</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>other things, certain third party data comparing BlackRock&#146;s operating</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>margin with that of other publicly-traded asset management firms. That</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>third party data indicates that larger asset bases do not, in themselves,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>translate to higher profit margins.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In addition, the Board considered the cost of the services provided to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund by BlackRock, and BlackRock&#146;s and its affiliates&#146; profits relating</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to the management and distribution of the Fund and the other funds</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>advised by BlackRock and its affiliates. As part of its analysis, the Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reviewed BlackRock&#146;s methodology in allocating its costs to the manage-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment of the Fund. The Board also considered whether BlackRock has the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial resources necessary to attract and retain high quality invest-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment management personnel to perform its obligations under the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agreements and to continue to provide the high quality of services that</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>is expected by the Board.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board noted that the Fund&#146;s contractual management fee rate was</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>lower than or equal to the median contractual management fee rate</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>paid by the Fund's Peers, in each case, before taking into account any</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>expense reimbursements or fee waivers.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>D. Economies of Scale: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board, including the Independent Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Members, considered the extent to which economies of scale might be</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>realized as the assets of the Fund increase. The Board also considered</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the extent to which the Fund benefits from such economies and whether</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>there should be changes in the advisory fee rate or structure in order to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>enable the Fund to participate in these economies of scale, for example</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>through the use of breakpoints in the advisory fee based upon the asset</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>level of the Fund.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board noted that most closed-end fund complexes do not have fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>level breakpoints because closed-end funds generally do not experience</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>substantial growth after the initial public offering and each fund is man-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>aged independently consistent with its own investment objectives. The</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Board noted that only one closed-end fund in the Fund Complex has</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>breakpoints in its fee structure. Information provided by Lipper also</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>revealed that only one closed-end fund complex with total closed-end</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>fund nets assets exceeding $10 billion, as of December 31, 2009,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>used a complex level breakpoint structure.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>E. Other Factors Deemed Relevant by the Board Members: </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>including the Independent Board Members, also took into account other</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ancillary or &#147;fall-out&#148; benefits that BlackRock or its affiliates and signifi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cant shareholders may derive from their respective relationships with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Fund, both tangible and intangible, such as BlackRock&#146;s ability to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>leverage its investment professionals who manage other portfolios, an</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>increase in BlackRock&#146;s profile in the investment advisory community,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and the engagement of BlackRock&#146;s affiliates and significant sharehold-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ers as service providers to the Fund, including for administrative and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>distribution services. The Board also considered BlackRock&#146;s overall</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>operations and its efforts to expand the scale of, and improve the qual-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ity of, its operations. The Board also noted that BlackRock may use and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>benefit from third party research obtained by soft dollars generated by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>certain mutual fund transactions to assist in managing all or a number</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of its other client accounts. The Board further noted that BlackRock com-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>pleted the acquisition of a complex of exchange-traded funds (&#147;ETFs&#148;)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on December 1, 2009, and that BlackRock&#146;s funds may invest in such</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ETFs without any offset against the management fees payable by the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>funds to BlackRock.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>In connection with its consideration of the Agreements, the Board also</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>received information regarding BlackRock&#146;s brokerage and soft dollar</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>practices. The Board received reports from BlackRock which included</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information on brokerage commissions and trade execution practices</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>throughout the year.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board noted the competitive nature of the closed-end fund market-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>place, and that shareholders are able to sell their Fund shares in the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>secondary market if they believe that the Fund&#146;s fees and expenses are</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>too high or if they are dissatisfied with the performance of the Fund.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>21</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Disclosure of Investment Advisory Agreement and Sub-Advisory Agreement (concluded)</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-Demi,Arial,Helvetica,sans-serif>Conclusion</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Board, including the Independent Board Members, unanimously</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>approved the continuation of the Advisory Agreement between the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Manager and the Fund for a one-year term ending June 30, 2011</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and the Sub-Advisory Agreements between the Manager and the Sub-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Advisors, with respect to the Fund, for a one-year term ending June 30,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2011. As part of its approval, the Board considered the discussions of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s fee structure, as it applies to the Fund, being conducted by</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCndItal,Arial,Helvetica,sans-serif>ad hoc </FONT><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Joint Product Pricing Committee. Based upon its evaluation</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of all of the aforementioned factors in their totality, the Board, including</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Independent Board Members, was satisfied that the terms of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agreements were fair and reasonable and in the best interest of the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund and its shareholders. In arriving at a decision to approve the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agreements, the Board did not identify any single factor or group of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>factors as all-important or controlling, but considered all factors</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>together, and different Board Members may have attributed different</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>weights to the various factors considered. The Independent Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Members were also assisted by the advice of independent legal counsel</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in making this determination. The contractual fee arrangements for the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Fund reflect the results of several years of review by the Board Members</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and predecessor Board Members, and discussions between such Board</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Members (and predecessor Board Members) and BlackRock. Certain</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>aspects of the arrangements may be the subject of more attention in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>some years than in others, and the Board Members&#146; conclusions may</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>be based in part on their consideration of these arrangements in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>prior years.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>22 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Automatic Dividend Reinvestment Plan</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Pursuant to the Fund&#146;s Dividend Reinvestment Plan (the &#147;Reinvestment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Plan&#148;), Common Shareholders are automatically enrolled to have all</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>distributions of dividends and capital gains reinvested by BNY Mellon</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Shareowner Services (the &#147;Plan Agent&#148;) in the Fund&#146;s shares pursuant</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to the Reinvestment Plan. Shareholders who do not participate in the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Reinvestment Plan will receive all distributions in cash paid by check</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and mailed directly to the shareholders of record (or if the shares are</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>held in street or other nominee name, then to the nominee) by the Plan</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Agent, which serves as agent for the shareholders in administering</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Reinvestment Plan.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>After the Fund declares a dividend or determine to make a capital gain</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>distribution, the Plan Agent will acquire shares for the participants&#146;</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounts, depending upon the following circumstances, either</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(i) through receipt of unissued but authorized shares from the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(&#147;newly issued shares&#148;) or (ii) by purchase of outstanding shares on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the open market, on the Fund&#146;s primary exchange (&#147;open-market pur-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>chases&#148;). If, on the dividend payment date, the net asset value per</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>share (&#147;NAV&#148;) is equal to or less than the market price per share plus</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>estimated brokerage commissions (such condition often referred to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>as a &#147;market premium&#148;), the Plan Agent will invest the dividend amount</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in newly issued shares on behalf of the participants. The number of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>newly issued shares to be credited to each participant&#146;s account will</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>be determined by dividing the dollar amount of the dividend by the NAV</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on the date the shares are issued. However, if the NAV is less than 95%</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the market price on the payment date, the dollar amount of the divi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>dend will be divided by 95% of the market price on the payment date.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>If, on the dividend payment date, the NAV is greater than the market</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>value per share plus estimated brokerage commissions (such condition</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>often referred to as a &#147;market discount&#148;), the Plan Agent will invest the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>dividend amount in shares acquired on behalf of the participants in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>open-market purchases. If the Plan Agent is unable to invest the full</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>dividend amount in open market purchases, or if the market discount</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shifts to a market premium during the purchase period, the Plan Agent</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>will invest any un-invested portion in newly issued shares.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Participation in the Reinvestment Plan is completely voluntary and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may be terminated or resumed at any time without penalty by notice</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>if received and processed by the plan a dministrator prior to the divi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>dend record date; otherwise such termination or resumption will</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>be effective with respect to any subsequently declared dividend or</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>other distribution.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Plan Agent&#146;s fees for the handling of the reinvestment of dividends</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and distributions will be paid by the Fund. However, each participant</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>will pay a pro rata share of brokerage commissions incurred with</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>respect to the Plan Agent&#146;s open market purchases in connection</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with the reinvestment of dividends and distributions. The automatic</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>reinvestment of dividends and distributions will not relieve participants</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of any federal income tax that may be payable on such dividends</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or distributions.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund reserves the right to amend or terminate the Reinvestment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Plan. There is no direct service charge to participants in the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Reinvestment Plan; however, the Fund reserves the right to amend</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Reinvestment Plan to include a service charge payable by the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>participants. Participants that request a sale of shares through</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BNY Mellon Shareowner Services are subject to a $0.02 per share</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>sold brokerage commission. All correspondence concerning the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Reinvestment Plan should be directed to the Plan Agent: BNY Mellon</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Shareowner Services, P.0. Box 358035, Pittsburgh, PA 15252-8035,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Telephone: (866) 216-0242.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>23</FONT></P>
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     <TD colSpan=2 align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Officers and Directors</FONT>&nbsp;</TD>
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     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Number of BlackRock-</FONT></B>&nbsp;</TD>
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     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Advised Registered</FONT></B>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
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     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Length</FONT></B>&nbsp;</TD>
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     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Companies</FONT></B>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Position(s)</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>of Time</FONT></B>&nbsp;</TD>
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     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(&#147;RICs&#148;) Consisting of</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Name, Address</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Held with</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Served as</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Portfolios</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Public</FONT></B>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>and Year of Birth</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>a Director</FONT></B><B><SUP><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2</FONT></SUP></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Principal Occupation(s) During Past 5 Years</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(&#147;Portfolios&#148;) Overseen</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 1px" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Directorships</FONT></B>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 colSpan=2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Non-Interested Directors</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
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     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Richard E. Cavanagh</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chairman</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Trustee, Aircraft Finance Trust from 1999 to 2009; Director, The</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICS consisting of</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Arch Chemical</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Board</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Guardian Life Insurance Company of America since 1998; Trustee,</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(chemical and allied</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Director</FONT>&nbsp;</TD>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Educational Testing Service from 1997 to 2009 and Chairman from</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>products)</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1946</FONT>&nbsp;</TD>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2005 to 2009; Senior Advisor, The Fremont Group since 2008 and</FONT>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
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     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director thereof since 1996; Adjunct Lecturer, Harvard University since</FONT>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=2 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007; President and Chief Executive Officer of The Conference Board,</FONT>&nbsp;</TD>
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<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Inc. (global business research organization) from 1995 to 2007.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Karen P. Robards</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Vice Chair</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Partner of Robards &amp; Company, LLC (financial advisory firm) since</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>AtriCure, Inc.</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Board,</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1987; Co-founder and Director of the Cooke Center for Learning</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(medical devices)</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chair of</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Development, (a not-for-profit organization) since 1987;</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1950</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Audit</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director of Care Investment Trust, Inc. (health care real estate</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investment trust) from 2007 to 2010; Director of Enable Medical</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Director</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Corp. from 1996 to 2005; Investment Banker at Morgan Stanley</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
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<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from 1976 to 1987.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Frank J. Fabozzi</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Consultant/Editor of The Journal of Portfolio Management since</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>None</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Member</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2006; Professor in the Practice of Finance and Becton Fellow, Yale</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Audit</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>University, School of Management, since 2006; Adjunct Professor</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1948</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of Finance and Becton Fellow, Yale University from 1994 to 2006.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Kathleen F. Feldstein</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>President of Economics Studies, Inc. (private economic consulting</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The McClatchy</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>firm) since 1987; Chair, Board of Trustees, McLean Hospital from</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Company</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2000 to 2008 and Trustee Emeritus thereof since 2008; Member</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(publishing);</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1941</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Board of Partners Community Healthcare, Inc. from 2005 to</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BellSouth (tele-</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of 2009; Member of the Corporation of Partners HealthCare since</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>communications);</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1995; Trustee, Museum of Fine Arts, Boston since 1992; Member</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Knight Ridder</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Visiting Committee to the Harvard University Art Museum</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(publishing)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=6 align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>since 2003; Director, Catholic Charities of Boston since 2009.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
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     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>James T. Flynn</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chief Financial Officer of JP Morgan &amp; Co., Inc. from 1990 to 1995.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>None</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Member</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Audit</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1939</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Jerrold B. Harris</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Trustee, Ursinus College since 2000; Director, Troemner LLC</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Kelso</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(scientific equipment) since 2000; Director of Delta Waterfowl</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Capital Corp.</FONT>&nbsp;</TD></TR>
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     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Foundation since 2001; President and Chief Executive Officer,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(business develop-</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1942</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>VWR Scientific Products Corporation from 1990 to 1999.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment company)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>R. Glenn Hubbard</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Dean, Columbia Business School since 2004; Columbia faculty</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ADP (data and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>member since 1988; Co-Director, Columbia Business School&#146;s</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information services);</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Entrepreneurship Program from 1997 to 2004; Visiting Professor,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>KKR Financial</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1958</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>John F. Kennedy School of Government at Harvard University and</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Corporation (finance);</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the Harvard Business School since 1985 and at the University of</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Metropolitan Life</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chicago since 1994; Chairman, U.S. Council of Economic Advisers</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Insurance Company</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>under the President of the United States from 2001 to 2003;</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(insurance)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chairman, Economic Policy Committee of the OECD from 2001</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to 2003.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>24 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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     <TD colSpan=4 align=left><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Officers and Directors (continued)</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Number of BlackRock-</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
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     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Advised Registered</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Length</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Companies</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Position(s)</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>of Time</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(&#147;RICs&#148;) Consisting of</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Name, Address</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Held with</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Served as</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Portfolios</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Public</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>and Year of Birth</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>a Director</FONT></B><B><SUP><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>2</FONT></SUP></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Principal Occupation(s) During Past 5 Years</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(&#147;Portfolios&#148;) Overseen</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Directorships</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 colSpan=2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Non-Interested Directors</FONT></B><B><SUP><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP></B><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>(concluded)</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>W. Carl Kester</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>George Fisher Baker Jr. Professor of Business Administration,</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>99 RICs consisting of</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>None</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Member</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Harvard Business School; Deputy Dean for Academic Affairs,</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>97 Portfolios</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of the Audit</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>since 2006; Unit Head, Finance, Harvard Business School,</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1951</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Committee</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from 2005 to 2006; Senior Associate Dean and Chairman of the</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>MBA Program of Harvard Business School, from 1999 to 2005;</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Member of the faculty of Harvard Business School since 1981;</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Independent Consultant since 1978.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=4 align=left><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=5 align=left><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Date shown is the earliest date a person has served as a director of the Fund covered by this annual report. Following the combination of Merrill Lynch</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" colSpan=5 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investment Managers, L.P. (&#147;MLIM&#148;) and BlackRock, Inc. (&#147;BlackRock&#148;) in September 2006, the various legacy MLIM and legacy BlackRock Fund</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" colSpan=5 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>boards were realigned and consolidated into three new Fund boards in 2007. As a result, although the chart shows directors as joining the Fund&#146;s</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" colSpan=5 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>board in 2007, each director first became a member of the board of other legacy MLIM or legacy BlackRock Funds as follows: Richard E. Cavanagh,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 1px" colSpan=5 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1994; Frank J. Fabozzi, 1988; Kathleen F. Feldstein, 2005; James T. Flynn, 1996; Jerrold B. Harris, 1999; R. Glenn Hubbard, 2004; W. Carl Kester,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 1px" colSpan=3 align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1995; and Karen P. Robards, 1998.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 3px" bgColor=#e4e6f2 align=left><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Interested Directors</FONT></B><B><SUP><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>3</FONT></SUP></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Richard S. Davis</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>President</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director, BlackRock, Inc. since 2005; Chief Executive</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>169 RICs consisting of</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>None</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer, State Street Research &amp; Management Company from 2000</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>290 Portfolios</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to 2005; Chairman of the Board of Trustees, State Street Research</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1945</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Mutual Funds from 2000 to 2005.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Henry Gabbay</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Consultant, BlackRock, Inc. from 2007 to 2008; Managing</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>169 RICs consisting of</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>None</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Director, BlackRock, Inc. from 1989 to 2007; Chief Administrative</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>290 Portfolios</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer, BlackRock Advisors, LLC from 1998 to 2007; President of</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1947</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Funds and BlackRock Bond Allocation Target Shares</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>from 2005 to 2007; Treasurer of certain closed-end funds in the</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock fund complex from 1989 to 2006.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>3 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Mr. Davis is an &#147;interested person,&#148; as defined in the 1940 Act, of the Fund based on his position with BlackRock, Inc. and its affiliates. Mr. Gabbay is</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>an &#147;interested person&#148; of the Fund based on his former positions with BlackRock, Inc. and its affiliates as well as his ownership of BlackRock, Inc. and</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The PNC Financial Services Group, Inc. securities. Directors serve until their resignation, removal or death, or until December 31 of the year in which</FONT><BR>
<FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>they turn 72.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>25</FONT></P>
<HR align=center SIZE=2 width="100%" noShade>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Officers and Directors (concluded)</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="13%"></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="65%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Position(s)</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Name, Address</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Held with</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Length of</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>and Year of Birth</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Time Served</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Principal Occupation(s) During Past 5 Years</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=center><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Officers</FONT></B><B><SUP><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>1</FONT></SUP></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#e4e6f2 align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Anne Ackerley</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>President</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director of BlackRock, Inc. since 2000; Vice President of the BlackRock-advised funds from 2007 to</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Chief</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2</FONT></SUP>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2009; Chief Operating Officer of BlackRock&#146;s Global Client Group (GCG) since 2009; Chief Operating Officer of</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Executive</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock&#146;s US Retail Group from 2006 to 2009; Head of BlackRock&#146;s Mutual Fund Group from 2000 to 2006.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1962</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Brendan Kyne</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Vice</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director of BlackRock since 2010; Director of BlackRock, Inc. from 2008 to 2009; Head of Product</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>President</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2009</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Development and Management for BlackRock&#146;s US Retail Group since 2009, co-head thereof from 2007 to</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2009; Vice President of BlackRock, Inc. from 2005 to 2008.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1977</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Neal Andrews</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chief</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director of BlackRock, Inc. since 2006; Senior Vice President and Line of Business Head of Fund</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Financial</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Accounting and Administration at PNC Global Investment Servicing (US) Inc. from 1992 to 2006.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1966</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Jay Fife</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Treasurer</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director of BlackRock, Inc. since 2007 and Director in 2006; Assistant Treasurer of the Merrill Lynch</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Investment Managers, L.P. (&#147;MLIM&#148;) and Fund Asset Management, L.P. advised funds from 2005 to 2006; Director</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of MLIM Fund Services Group from 2001 to 2006.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1970</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Brian Kindelan</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chief</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Chief Compliance Officer of the BlackRock-advised funds since 2007; Managing Director and Senior Counsel</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Compliance</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of BlackRock, Inc. since 2005.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officer</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1959</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Howard Surloff</FONT></B>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Secretary</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Since</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Managing Director and General Counsel of US Funds at BlackRock, Inc. since 2006; General Counsel (US)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>55 East 52nd Street</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2007</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>of Goldman Sachs Asset Management, L.P. from 1993 to 2006.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10055</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1965</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Officers of the Fund serve at the pleasure of the Board.</FONT><BR>
<SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>2 </FONT></SUP><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Ms. Ackerley has been President and Chief Executive Officer since 2009 and Vice President from 2007 to 2009.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="19%"></TD>
     <TD width="20%"></TD>
     <TD width="19%"></TD>
     <TD width="22%"></TD>
     <TD width="17%"></TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment Advisor</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Transfer Agent</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Custodian</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Legal Counsel</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Address of the Fund</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Advisors, LLC</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BNY Mellon</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Brown Brothers,</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Skadden, Arps, Slate,</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100 Bellevue Parkway</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Wilmington, DE 19809</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Shareowner Services</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Harriman &amp; Co.</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Meagher &amp; Flom LLP</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Wilmington, DE 19809</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Jersey City, NJ 07310</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Boston, MA 02109</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>New York, NY 10036</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Sub-Advisor</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Investment</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Accounting Agent</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Independent Registered</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Management, LLC</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>State Street Bank</FONT>&nbsp;</TD>
     <TD align=left><B><FONT color=#231f20 size=2 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Public Accounting Firm</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Plainsboro, NJ 08536</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Trust Company</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Deloitte &amp; Touche LLP</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Princeton, NJ 08540</FONT>&nbsp;</TD>
     <TD align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Princeton, NJ 08540</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>26 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<A name="page_28"></A><BR>
<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Additional Information</FONT><BR>
<BR>
<B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Proxy Results</FONT></B><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Annual Meeting of Shareholders was held on September 2, 2010 for shareholders of record on July 6, 2010, to elect director nominees for</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock Enhanced Capital and Income Fund, Inc. There were no broker non-votes with regard to any non-routine matters for the Fund.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="17%"></TD>
     <TD width="6%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="6%"></TD>
     <TD width="9%"></TD>
     <TD width="8%"></TD>
     <TD width="7%"></TD>
     <TD width="9%"></TD>
     <TD width="8%"></TD>
     <TD width="5%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=8 align=left><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Below are the results with respect to each nominee, who will continue to serve as Director for the Fund:</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Richard E. Cavanagh</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Richard S. Davis</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Frank J. Fabozzi</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Kathleen F. Feldstein</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,073,323 1,155,220</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,071,696</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,156,847</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,109,544</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,118,999</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>34,984,628</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,243,915</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>James T. Flynn</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Henry Gabbay</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Jerrold B. Harris</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>R. Glenn Hubbard</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,082,934 1,145,609</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,077,237</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,151,306</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,018,566</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,209,977</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,089,146</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,139,397</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>W. Carl Kester</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Karen P. Robards</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Votes For</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Withheld</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Abstain</FONT></B>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD>
     <TD align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,077,951 1,150,592</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>35,087,506</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>1,141,037</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>27</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Additional Information (continued)</FONT><BR>
<BR>
<B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>General Information</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund does not make available copies of its Statements of Additional</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Information because the Fund&#146;s shares are not continuously offered,</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>which means that the Statement of Additional Information of the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>has not been updated after completion of the Fund&#146;s offerings and the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>information contained in the Fund&#146;s Statement of Additional Information</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may have become outdated.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Electronic Delivery</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Electronic copies of most financial reports are available on the Fund&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>website or shareholders can sign up for e-mail notifications of quarterly</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>statements, annual and semi-annual reports by enrolling in the Fund&#146;s</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>electronic delivery program.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Shareholders Who Hold Accounts with Investment Advisors, Banks</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>or Brokerages:</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Please contact your financial advisor to enroll. Please note that not all</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>investment advisors, banks or brokerages may offer this service.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Householding</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund will mail only one copy of shareholder documents, including</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>annual and semi-annual reports and proxy statements, to shareholders</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with multiple accounts at the same address. This practice is commonly</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>called &#147;householding&#148; and it is intended to reduce expenses and elimi-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>nate duplicate mailings of shareholder documents. Mailings of your</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shareholder documents may be householded indefinitely unless you</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>instruct us otherwise. If you do not want the mailing of these documents</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to be combined with those for other members of your household, please</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>contact the Fund at (800) 441-7762.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Availability of Quarterly Schedule of Investments</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund files its complete schedule of portfolio holdings with the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Securities and Exchange Commission (&#147;SEC&#148;) for the first and third quar-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ters of each fiscal year on Form N-Q. The Fund&#146;s Forms N-Q are available</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>on the SEC&#146;s website at http://www.sec.gov and may also be reviewed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and copied at the SEC&#146;s Public Reference Room in Washington, DC.</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Information on the operation of the Public Reference Room may be</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>obtained by calling (800) SEC-0330. The Fund&#146;s Forms N-Q may also be</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>obtained upon request and without charge by calling (800) 441-7762.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Availability of Proxy Voting Policies and Procedures</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>A description of the policies and procedures that the Fund uses to deter-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>mine how to vote proxies relating to portfolio securities is available</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1) without charge, upon request, by calling toll-free (800) 441-7762;</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(2) at http://www.blackrock.com; and (3) on the SEC&#146;s website</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>at http://www.sec.gov.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Availability of Proxy Voting Record</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>Information about how the Fund voted proxies relating to securities</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>held in the Fund&#146;s portfolio during the most recent 12-month period</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ended June 30 is available upon request and without charge</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>(1) at http://www.blackrock.com or by calling (800) 441-7762</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and (2) on the SEC&#146;s website at http://www.sec.gov.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-MedCnd,Arial,Helvetica,sans-serif>Availability of Fund Updates</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock will update performance data for the Fund on a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>monthly basis on its website in the &#147;Closed-end Funds&#148; section of</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>http://www.blackrock.com. Investors and others are advised to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>periodically check the website for updated performance information</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and the release of other material information about the Fund.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>28 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<A name="page_30"></A><BR>
<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Additional Information (concluded)</FONT><BR>
<BR>
<B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Section 19(a) Notices</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>These reported amounts and sources of distributions are estimates and are not being provided for tax reporting purposes. The actual amounts and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>sources for tax reporting purposes will depend upon the Fund&#146;s investment experience during the year and may be subject to changes based on</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the tax regulations. The Fund will provide a Form 1099-DIV each calendar year that will explain the character of these dividends and distributions</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>for federal income tax purposes.</FONT></P>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="22%"></TD>
     <TD width="19%"></TD>
     <TD width="9%"></TD>
     <TD width="8%"></TD>
     <TD width="7%"></TD>
     <TD width="8%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="5%"></TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>October 31, 2010</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=2 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Cumulative Distributions</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=4 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>% Breakdown of the Total Cumulative</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>for the Fiscal Year</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Distributions for the Fiscal Year</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Realized</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Per</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Net Realized</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Total Per</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Return of</FONT></B>&nbsp;</TD>
     <TD align=right><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Common</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Return of</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Common</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Income</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Gains</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Share</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Income</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Gains</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Capital</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT color=#231f20 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Share</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>CII</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$0.292134</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$1.647866</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=right><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>$1.940000</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>15%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>0%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>85%</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#231f20 size=1 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>100%</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund estimates that it has distributed more than the amount of earned income and net realized gains; therefore, a portion of the distribution</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may be a return of capital. A return of capital may occur, for example, when some or all of the shareholder&#146;s investment in the Fund is returned to the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shareholder. A return of capital does not necessarily reflect the Fund&#146;s investment performance and should not be confused with &#145;yield&#146; or &#145;income&#146;.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Fund Certification</FONT></B><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund is listed for trading on the New York Stock Exchange (&#147;NYSE&#148;)</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and has filed with the NYSE its annual chief executive officer certification</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>regarding compliance with the NYSE&#146;s listing standards. The Fund filed</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with the SEC the certification of its chief executive officer and chief</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>financial officer required by section 302 of the Sarbanes-Oxley Act.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>Dividend Policy</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>The Fund&#146;s dividend policy is to distribute all or a portion of its net invest-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>ment income to its shareholders on a quarterly basis. In order to provide</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>shareholders with a more stable level of dividend distributions, the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>may at times pay out less than the entire amount of net investment</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>income earned in any particular quarter and may at times in any parti-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cular quarter pay out such accumulated but undistributed income in</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>addition to net investment income earned in that quarter. As a result,</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>the dividends paid by the Fund for any particular quarter may be more</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or less than the amount of net investment income earned by the Fund</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>during such quarter. The Fund&#146;s current accumulated but undistributed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>net investment income, if any, is disclosed in the Statement of Assets</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>and Liabilities, which comprises part of the financial information included</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>in this report.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>OCTOBER 31, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>29</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#004a91 size=4 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>Additional Information (concluded)</FONT><BR>
<BR>
<B><FONT color=#004a91 size=1 face=FranklinGothic-DemiCnd,Arial,Helvetica,sans-serif>BlackRock Privacy Principles</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock is committed to maintaining the privacy of its current and for-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>mer fund investors and individual clients (collectively, &#147;Clients&#148;) and to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>safeguarding their non-public personal information. The following infor-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>mation is provided to help you understand what personal information</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock collects, how we protect that information and why in certain</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cases we share such information with select parties.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>If you are located in a jurisdiction where specific laws, rules or regulations</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>require BlackRock to provide you with additional or different privacy-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>related rights beyond what is set forth below, then BlackRock will comply</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>with those specific laws, rules or regulations.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock obtains or verifies personal non-public information from and</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>about you from different sources, including the following: (i) information</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>we receive from you or, if applicable, your financial intermediary, on appli-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cations, forms or other documents; (ii) information about your transac-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>tions with us, our affiliates, or others; (iii) information we receive from a</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>consumer reporting agency; and (iv) from visits to our websites.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>BlackRock does not sell or disclose to non-affiliated third parties any non-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>public personal information about its Clients, except as permitted by law</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>or as is necessary to respond to regulatory requests or to service Client</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>accounts. These non-affiliated third parties are required to protect the</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>confidentiality and security of this information and to use it only for its</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>intended purpose.</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>We may share information with our affiliates to service your account or to</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>provide you with information about other BlackRock products or services</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>that may be of interest to you. In addition, BlackRock restricts access</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to non-public personal information about its Clients to those BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>employees with a legitimate business need for the information. BlackRock</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>maintains physical, electronic and procedural safeguards that are designed</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>to protect the non-public personal information of its Clients, including pro-</FONT><BR>
<FONT color=#231f20 size=2 face=FranklinGothic-BookCnd,Arial,Helvetica,sans-serif>cedures relating to the proper storage and disposal of such information.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=1 face=FranklinGothic-Book,Arial,Helvetica,sans-serif>30 BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC. OCTOBER 31, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT color=#231f20 size=2 face=CorporateS-Light,Arial,Helvetica,sans-serif>This report is transmitted to shareholders only. It is not a</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=CorporateS-Light,Arial,Helvetica,sans-serif>prospectus. Past performance results shown in this report</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=CorporateS-Light,Arial,Helvetica,sans-serif>should not be considered a representation of future per-</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=CorporateS-Light,Arial,Helvetica,sans-serif>formance. Statements and other information herein are</FONT><BR>
<BR>
<FONT color=#231f20 size=2 face=CorporateS-Light,Arial,Helvetica,sans-serif>as dated and are subject to change.</FONT></P>
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<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 2 &#150; Code of Ethics &#150; The registrant (or the &#147;Fund&#148;) has adopted a code of ethics, as of the end</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of the period covered by this report, applicable to the registrant&#146;s principal executive officer,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">principal financial officer and principal accounting officer, or persons performing similar</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">functions. During the period covered by this report, there have been no amendments to or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">waivers granted under the code of ethics. A copy of the code of ethics is available without</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">charge at www.blackrock.com.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 3 &#150; Audit Committee Financial Expert &#150; The registrant&#146;s board of directors or trustees, as</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">applicable (the &#147;board of directors&#148;), has determined that (i) the registrant has the following</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">audit committee financial experts serving on its audit committee and (ii) each audit</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">committee financial expert is independent:</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kent Dixon (retired effective December 31, 2009)</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Frank J. Fabozzi</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">James T. Flynn</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">W. Carl Kester</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Karen P. Robards</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The registrant&#146;s board of directors has determined that W. Carl Kester and Karen P. Robards</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Prof. Kester has a thorough understanding of generally accepted accounting principles,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial statements and internal control over financial reporting as well as audit committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">functions. Prof. Kester has been involved in providing valuation and other financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">consulting services to corporate clients since 1978. Prof. Kester&#146;s financial consulting</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">services present a breadth and level of complexity of accounting issues that are generally</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">comparable to the breadth and complexity of issues that can reasonably be expected to be</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">raised by the registrant&#146;s financial statements.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Ms. Robards has a thorough understanding of generally accepted accounting principles,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial statements and internal control over financial reporting as well as audit committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">functions. Ms. Robards has been President of Robards &amp; Company, a financial advisory</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">where she was responsible for evaluating and assessing the performance of companies based</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">on their financial results. Ms. Robards has over 30 years of experience analyzing financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">statements. She also is a member of the audit committee of one publicly held company and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a non-profit organization.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Under applicable securities laws, a person determined to be an audit committee financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">expert will not be deemed an &#147;expert&#148; for any purpose, including without limitation for the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">purposes of Section 11 of the Securities Act of 1933, as a result of being designated or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">identified as an audit committee financial expert. The designation or identification as an</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">audit committee financial expert does not impose on such person any duties, obligations, or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">liabilities greater than the duties, obligations, and liabilities imposed on such person as a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">member of the audit committee and board of directors in the absence of such designation or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">identification. The designation or identification as an audit committee financial expert does</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">not affect the duties, obligations, or liability of any other member of the audit committee or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">board of directors.</FONT></P>

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<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 4 &#150; Principal Accountant Fees and Services</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
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&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;" style="TEXT-INDENT:5.000000px">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(a) Audit Fees</FONT></B>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;" style="TEXT-INDENT:1.000000px">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(b) Audit-Related Fees</FONT></B><B><SUP><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">1</FONT></SUP></B>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;" style="TEXT-INDENT:6.000000px">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(c) Tax Fees</FONT></B><B><SUP><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">2</FONT></SUP></B>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;" style="TEXT-INDENT:3.000000px">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(d) All Other Fees</FONT></B><B><SUP><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">3</FONT></SUP></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Current</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Previous</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Current</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Previous</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Current</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Previous</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Current</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Previous</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fiscal Year</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:3px double #000000;" style="TEXT-INDENT:3.000000px">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Entity Name</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Enhanced Capital</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and Income Fund,</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;37,400</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;37,400</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;0</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;0</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;6,100</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;6,100</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;0</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;1,028</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Inc.</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1 The nature of the services include assurance and related services reasonably related to the performance of the audit of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial statements not included in Audit Fees.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2 The nature of the services include tax compliance, tax advice and tax planning.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3 The nature of the services include a review of compliance procedures and attestation thereto.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(e)(1) Audit Committee Pre-Approval Policies and Procedures:</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The registrant&#146;s audit committee (the &#147;Committee&#148;) has adopted policies and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">procedures with regard to the pre-approval of services. Audit, audit-related and tax</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compliance services provided to the registrant on an annual basis require specific pre-</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">approval by the Committee. The Committee also must approve other non-audit services</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">provided to the registrant and those non-audit services provided to the registrant&#146;s affiliated</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">service providers that relate directly to the operations and the financial reporting of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">registrant. Certain of these non-audit services that the Committee believes are a) consistent</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">with the SEC&#146;s auditor independence rules and b) routine and recurring services that will</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">not impair the independence of the independent accountants may be approved by the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Committee without consideration on a specific case-by-case basis (&#147;general pre-approval&#148;).</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The term of any general pre-approval is 12 months from the date of the pre-approval, unless</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the Committee provides for a different period. Tax or other non-audit services provided to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the registrant which have a direct impact on the operation or financial reporting of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">registrant will only be deemed pre-approved provided that any individual project does not</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">exceed &#36;10,000 attributable to the registrant or &#36;50,000 per project. For this purpose,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">multiple projects will be aggregated to determine if they exceed the previously mentioned</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">cost levels.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Any proposed services exceeding the pre-approved cost levels will require specific</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">pre-approval by the Committee, as will any other services not subject to general pre-</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">approval (e.g., unanticipated but permissible services). The Committee is informed of each</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">service approved subject to general pre-approval at the next regularly scheduled in-person</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">board meeting. At this meeting, an analysis of such services is presented to the Committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for ratification. The Committee may delegate to the Committee Chairman the authority to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">approve the provision of and fees for any specific engagement of permitted non-audit</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">services, including services exceeding pre-approved cost levels.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(e)(2) None of the services described in each of Items 4(b) through (d) were approved by</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(f) Not Applicable</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(g) </FONT><U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Affiliates&#146; Aggregate Non-Audit Fees:</FONT></U></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=26%></TD>
     <TD width=40%></TD>
     <TD width=32%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Current Fiscal Year</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:1px solid #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Previous Fiscal Year</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Entity Name</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
	<TD align=center style="border-bottom:3px double #000000;">
<B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">End</FONT></B>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>

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<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=45%></TD>
     <TD width=30%></TD>
     <TD width=23%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital</FONT>&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;16,877</FONT>&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;409,628</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and Income Fund, Inc.</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(h) The registrant&#146;s audit committee has considered and determined that the provision of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">non-audit services that were rendered to the registrant&#146;s investment adviser (not including</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">any non-affiliated sub-adviser whose role is primarily portfolio management and is</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">subcontracted with or overseen by the registrant&#146;s investment adviser), and any entity</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">controlling, controlled by, or under common control with the investment adviser that</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">provides ongoing services to the registrant that were not pre-approved pursuant to paragraph</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accountant&#146;s independence.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Regulation S-X Rule 2-01(c)(7)(ii) &#150; &#36;10,777, 0%</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 5 &#150; Audit Committee of Listed Registrants</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a) The following individuals are members of the registrant&#146;s separately-designated</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">standing audit committee established in accordance with Section 3(a)(58)(A) of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kent Dixon (retired effective December 31, 2009)</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Frank J. Fabozzi</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">James T. Flynn</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">W. Carl Kester</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Karen P. Robards</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(b) Not Applicable</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 6 &#150; Investments</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a) The registrant&#146;s Schedule of Investments is included as part of the Report to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Stockholders filed under Item 1 of this Form.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(b) Not Applicable due to no such divestments during the semi-annual period covered since</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the previous Form N-CSR filing.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 7 &#150; Disclosure of Proxy Voting Policies and Procedures for Closed-End Management</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Companies &#150; The board of directors has delegated the voting of proxies for the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fund securities to the Fund&#146;s investment adviser (&#147;Investment Adviser&#148;) pursuant to the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Adviser&#146;s proxy voting guidelines. Under these guidelines, the Investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Adviser will vote proxies related to Fund securities in the best interests of the Fund and its</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">stockholders. From time to time, a vote may present a conflict between the interests of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fund&#146;s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">person of the Fund or the Investment Adviser, on the other. In such event, provided that the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Adviser&#146;s Equity Investment Policy Oversight Committee, or a sub-committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">thereof (the &#147;Oversight Committee&#148;) is aware of the real or potential conflict or material</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">non-routine matter and if the Oversight Committee does not reasonably believe it is able to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">follow its general voting guidelines (or if the particular proxy matter is not addressed in the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">guidelines) and vote impartially, the Oversight Committee may retain an independent</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Adviser&#146;s clients. If the Investment Adviser determines not to retain an</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">independent fiduciary, or does not desire to follow the advice of such independent fiduciary,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the Oversight Committee shall determine how to vote the proxy after consulting with the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Investment Adviser&#146;s Portfolio Management Group and/or the Investment Adviser&#146;s Legal</FONT></P>

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<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and Compliance Department and concluding that the vote cast is in its client&#146;s best interest</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">notwithstanding the conflict. A copy of the Fund&#146;s Proxy Voting Policy and Procedures are</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">attached as Exhibit 99.PROXYPOL. Information on how the Fund voted proxies relating to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">portfolio securities during the most recent 12-month period ended June 30 is available</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">without charge, (i) at www.blackrock.com and (ii) on the SEC&#146;s website at</FONT><BR>
<U><FONT color=#0000ff size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">http://www.sec.gov</FONT></U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 8 &#150; Portfolio Managers of Closed-End Management Investment Companies &#150; as of October 31,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2010.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a)(1) The registrant (or &#147;Fund&#148;) is managed by a team of investment professionals</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">comprised of Kevin Rendino, Managing Director at BlackRock, Inc., Kurt</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Schansinger, Managing Director at BlackRock, Inc., Carrie King, Director and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">associate portfolio manager and Kyle G. McClements, CFA, Managing Director at</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock, Inc. Mr. Rendino is head of BlackRock, Inc.&#146;s Basic Value Equity team.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Mr. Schansinger and Ms. King are members of BlackRock, Inc.&#146;s Basic Value Equity</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">team. Mr. McClements is a member of BlackRock, Inc.&#146;s Quantitative Investments</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">team. Messrs. Rendino, Schansinger and McClements and Ms. King are responsible</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for the day-to-day management of the Fund&#146;s portfolio and the selection of its</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investments. Messrs. Rendino, and Schansinger and Ms. King have been members of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the Fund&#146;s portfolio management team since 2004, 2008 and 2008, respectively. Mr.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">McClements joined the registrant&#146;s management team in 2009.</FONT></P>
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     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 7px" colSpan=2 align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Portfolio Manager</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Biography</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
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     <TD style="TEXT-INDENT: 7px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kevin Rendino</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Managing Director of BlackRock, Inc. since 2006; Head of BlackRock's</FONT>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Basic Value Equity team; Managing Director of Merrill Lynch Investment</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=3 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Managers, L.P. (&#147;MLIM&#148;) from 2000 to 2006.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 7px" colSpan=2 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kurt Schansinger</FONT>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Managing Director of BlackRock, Inc. since 2006; Managing Director of</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=2 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">MLIM from 2000 - 2006.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 7px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Carrie King</FONT>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Director of BlackRock, Inc. since 2007; Vice President of BlackRock, Inc.</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=4 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">in 2006; Vice President of MLIM from 1993 to 2006.</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 7px" colSpan=2 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kyle G. McClements</FONT>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Managing Director of BlackRock, Inc. since 2009; Director of BlackRock,</FONT>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Inc. from 2006 to 2008; Vice President of BlackRock, Inc. in 2005; Vice</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" colSpan=5 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">President of State Street Research &amp; Management from 2004 to 2005.</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 7px" colSpan=3 align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a)(2) As of October 31, 2010:</FONT>&nbsp;</TD>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD colSpan=3 align=right><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(ii) Number of Other Accounts Managed</FONT></B>&nbsp;</TD>
     <TD colSpan=3 align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(iii) Number of Other Accounts and</FONT></B>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD colSpan=2 align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">and Assets by Account Type</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD colSpan=3 align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Assets for Which Advisory Fee is</FONT></B>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Performance-Based</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other Pooled</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other Pooled</FONT></B>&nbsp;</TD>
     <TD align=left>&nbsp;</TD></TR>
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     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(i) Name of</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Registered</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Registered</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other</FONT></B>&nbsp;</TD></TR>
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     <TD align=right><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Portfolio Manager</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Vehicles</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Accounts</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Investment</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Vehicles</FONT></B>&nbsp;</TD>
     <TD align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Accounts</FONT></B>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Companies</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B><FONT size=1 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Companies</FONT></B>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=left><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kevin Rendino</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">6</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 10px" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$7.68 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$2.17 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD></TR>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=left><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kurt Schansinger</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">6</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 10px" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$7.68 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$2.17 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=left><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Carrie King</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">6</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 10px" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$7.68 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$2.17 Billion</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=left>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kyle G. McClements</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">9</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid; TEXT-INDENT: 10px" bgColor=#ccffff align=center>
<P align=center><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</P>
</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" bgColor=#ccffff align=center>
<P><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">0</FONT>&nbsp;</P>
</TD></TR>
<TR>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$5.12 Billion</FONT></FONT></TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$159.3 Million</FONT></FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$12.23 Million</FONT></FONT></TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT>&nbsp;</TD>
     <TD align=center><FONT color=#000000 size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$0</FONT></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
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     <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD>
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<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(iv) Potential Material Conflicts of Interest</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock, Inc. (individually and together with its affiliates, &#147;BlackRock&#148;) has built a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">professional working environment, firm-wide compliance culture and compliance</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">procedures and systems designed to protect against potential incentives that may favor one</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">account over another. BlackRock has adopted policies and procedures that address the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">allocation of investment opportunities, execution of portfolio transactions, personal trading</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">by employees and other potential conflicts of interest that are designed to ensure that all</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">client accounts are treated equitably over time. Nevertheless, BlackRock furnishes</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment management and advisory services to numerous clients in addition to the Fund,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and BlackRock may, consistent with applicable law, make investment recommendations to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">other clients or accounts (including accounts which are hedge funds or have performance or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">higher fees paid to BlackRock, or in which portfolio managers have a personal interest in</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the receipt of such fees), which may be the same as or different from those made to the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fund. In addition, BlackRock, its affiliates and significant shareholders and any officer,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">director, stockholder or employee may or may not have an interest in the securities whose</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">purchase and sale BlackRock recommends to the Fund. BlackRock, or any of its affiliates</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">or significant shareholders, or any officer, director, stockholder, employee or any member</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of their families may take different actions than those recommended to the Fund by</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock with respect to the same securities. Moreover, BlackRock may refrain from</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">rendering any advice or services concerning securities of companies of which any of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock&#146;s (or its affiliates&#146; or significant shareholders&#146;) officers, directors or employees</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">are directors or officers, or companies as to which BlackRock or any of its affiliates or</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">significant shareholders or the officers, directors and employees of any of them has any</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">substantial economic interest or possesses material non-public information. Each portfolio</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">manager also may manage accounts whose investment strategies may at times be opposed to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the strategy utilized for a fund. In this connection, it should be noted that a portfolio</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">manager may currently manage certain accounts that are subject to performance fees. In</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">addition, a portfolio manager may assist in managing certain hedge funds and may be</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">entitled to receive a portion of any incentive fees earned on such funds and a portion of such</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">incentive fees may be voluntarily or involuntarily deferred. Additional portfolio managers</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">may in the future manage other such accounts or funds and may be entitled to receive</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">incentive fees.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">fairly. When BlackRock purchases or sells securities for more than one account, the trades</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">must be allocated in a manner consistent with its fiduciary duties. BlackRock attempts to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">allocate investments in a fair and equitable manner among client accounts, with no account</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">receiving preferential treatment. To this end, BlackRock has adopted a policy that is</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">intended to ensure that investment opportunities are allocated fairly and equitably among</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">client accounts over time. This policy also seeks to achieve reasonable efficiency in client</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">transactions and provide BlackRock with sufficient flexibility to allocate investments in a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">manner that is consistent with the particular investment discipline and client base.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a)(3) As of October 31, 2010:</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Portfolio Manager Compensation Overview</FONT></B><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock&#146;s financial arrangements with its portfolio managers, its competitive</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compensation and its career path emphasis at all levels reflect the value senior management</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">places on key resources. Compensation may include a variety of components and may vary</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">from year to year based on a number of factors. The principal components of compensation</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">include a base salary, a performance-based discretionary bonus, participation in various</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">benefits programs and one or more of the incentive compensation programs established by</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock such as its Long-Term Retention and Incentive Plan.</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Base compensation. </FONT></B><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Generally, portfolio managers receive base compensation based on</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">their seniority and/or their position with the firm. Senior portfolio managers who perform</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">additional management functions within the portfolio management group or within</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock may receive additional compensation for serving in these other capacities.</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Discretionary Incentive Compensation for Messrs. Rendino and Schansinger and Ms.</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">King</FONT></B><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Discretionary incentive compensation is based on a formulaic compensation program.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock&#146;s formulaic portfolio manager compensation program includes: pre-tax</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment performance relative to appropriate competitors or benchmarks over 1-, 3- and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5-year performance periods and a measure of operational efficiency. If a portfolio</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">manager&#146;s tenure is less than five years, performance periods will reflect time in position. In</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">most cases, including for the portfolio managers of the Fund, these benchmarks are the same</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">as the benchmark or benchmarks against which the performance of the Fund or other</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accounts managed by the portfolio managers are measured. BlackRock&#146;s Chief Investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Officers determine the benchmarks against which the performance of funds and other</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accounts managed by each portfolio manager is compared and the period of time over which</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">performance is evaluated. With respect to Messrs. Rendino and Schansinger and Ms. King,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">such benchmarks include a combination of Lipper Large Cap Value and Multi-Cap Value</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Funds classifications.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Portfolio managers who meet relative investment performance and financial management</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">objectives during a specified performance time period are eligible to receive an additional</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">bonus which may or may not be a large part of their overall compensation. A smaller</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">element of portfolio manager discretionary compensation may include consideration of:</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial results, expense control, profit margins, strategic planning and implementation,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">quality of client service, market share, corporate reputation, capital allocation, compliance</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and risk control, leadership, workforce diversity, supervision, technology and innovation.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">All factors are considered collectively by BlackRock management.</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Discretionary Incentive Compensation for Mr. McClements</FONT></B><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Discretionary incentive compensation is a function of several components: the performance</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of BlackRock, Inc., the performance of the portfolio manager&#146;s group within BlackRock,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the investment performance, including risk-adjusted returns, of the firm&#146;s assets under</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">management or supervision by that portfolio manager relative to predetermined</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">benchmarks, and the individual&#146;s seniority, role within the portfolio management team,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">teamwork and contribution to the overall performance of these portfolios and BlackRock.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">In most cases, including for the portfolio managers of the Fund, these benchmarks are the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">same as the benchmark or benchmarks against which the performance of the Fund or other</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accounts managed by the portfolio managers are measured. BlackRock&#146;s Chief Investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Officers determine the benchmarks against which the performance of funds and other</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accounts managed by each portfolio manager is compared and the period of time over which</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">performance is evaluated. With respect to Mr. McClements, such benchmarks include a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">combination of market-based indices (e.g., Mergent Dividend Achievers Index, The</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">S&amp;P/Citigroup Global Broad Market Index, Lipper Health/Biotechnology Funds Index, The</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Russell 3000 Healthcare Index, NYSE Arca Tech 100 Index, MSCI World Index) and yield</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">component.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock&#146;s Chief Investment Officers make a subjective determination with respect to the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">portfolio manager&#146;s compensation based on the performance of the funds and other accounts</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">managed by each portfolio manager relative to the various benchmarks noted above.</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Performance is measured on a pre-tax basis over various time periods including 1, 3 and 5-</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">year periods, as applicable.</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Distribution of Discretionary Incentive Compensation</FONT></B><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Discretionary incentive compensation is distributed to portfolio managers in a combination</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of cash and BlackRock, Inc. restricted stock units which vest ratably over a number of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">years. The BlackRock, Inc. restricted stock units, if properly vested, will be settled in</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock, Inc. common stock. Typically, the cash bonus, when combined with base</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">salary, represents more than 60% of total compensation for the portfolio managers. Paying</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a portion of annual bonuses in stock puts compensation earned by a portfolio manager for a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">given year &#147;at risk&#148; based on BlackRock&#146;s ability to sustain and improve its performance</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">over future periods.</FONT><BR>
<BR>
<I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Long-Term Retention and Incentive Plan (&#147;LTIP&#148;) &#151; </FONT></I><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">From time to time long-</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">term incentive equity awards are granted to certain key employees to aid in retention, align</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">their interests with long-term shareholder interests and motivate performance. Equity</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">awards are generally granted in the form of BlackRock, Inc. restricted stock units that, once</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">vested, settle in BlackRock, Inc. common stock. Messrs. Schansinger and McClements and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Ms. King have each received awards under the LTIP.</FONT><BR>
<BR>
<I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Deferred Compensation Program &#151; </FONT></I><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">A portion of the compensation paid to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">eligible BlackRock employees may be voluntarily deferred into an account that tracks the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">performance of certain of the firm&#146;s investment products. Each participant in the deferred</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compensation program is permitted to allocate his deferred amounts among the various</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment options. Messrs. Rendino, Schansinger and McClements and Ms. King have</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">each participated in the deferred compensation program.</FONT><BR>
<BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Other compensation benefits. </FONT></B><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">In addition to base compensation and discretionary</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">incentive compensation, portfolio managers may be eligible to receive or participate in one</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">or more of the following:</FONT><BR>
<BR>
<I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Incentive Savings Plans &#151; </FONT></I><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock, Inc. has created a variety of incentive</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">savings plans in which BlackRock employees are eligible to participate, including a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">company match equal to 50% of the first 6% of eligible pay contributed to the plan capped</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">at $4,000 per year, and a company retirement contribution equal to 3-5% of eligible</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compensation. The RSP offers a range of investment options, including registered</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment companies managed by the firm. BlackRock contributions follow the investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">direction set by participants for their own contributions or, absent employee investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">direction, are invested into a balanced portfolio. The ESPP allows for investment in</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock common stock at a 5% discount on the fair market value of the stock on the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">or a dollar value of $25,000. Each portfolio manager is eligible to participate in these plans.</FONT></P>
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<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(a)(4) </FONT><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Beneficial Ownership of Securities </FONT></I><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#150; As of October 31, 2010.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=39%></TD>
     <TD width=60%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Portfolio Manager</FONT></B>&nbsp;</TD>
	<TD align=left>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Dollar Range of Equity Securities</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">of the Fund Beneficially Owned</FONT></B>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kevin Rendino</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">None</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kurt Schansinger</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">None</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Carrie King</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">None</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Kyle G. McClements</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#36;1 - &#36;10,000</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(b) Not Applicable</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 9 &#150; Purchases of Equity Securities by Closed-End Management Investment Company and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Affiliated Purchasers &#150; Not Applicable due to no such purchases during the period covered</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">by this report.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 10 &#150; Submission of Matters to a Vote of Security Holders &#150; On September 17, 2010, the Board</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of Directors of the Fund amended and restated in its entirety the bylaws of the Fund (the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">"Amended and Restated Bylaws"). The Amended and Restated Bylaws were deemed</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">effective as of September 17, 2010 and set forth, among other things, the processes and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">procedures that shareholders of the Fund must follow, and specifies additional information</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">that shareholders of the Fund must provide, when proposing director nominations at any</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">annual meeting or special meeting in lieu of an annual meeting or other business to be</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">considered at an annual meeting or special meeting.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 11 &#150; Controls and Procedures</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">11(a) &#150; The registrant&#146;s principal executive and principal financial officers or persons performing</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">similar functions have concluded that the registrant&#146;s disclosure controls and procedures (as</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;1940 Act&#148;)) are effective as of a date within 90 days of the filing of this report based on the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">11(b) &#150; There were no changes in the registrant&#146;s internal control over financial reporting (as</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of the period covered by this report that have materially affected, or are reasonably likely to</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">materially affect, the registrant&#146;s internal control over financial reporting.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Item 12 &#150; Exhibits attached hereto</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">12(a)(1) &#150; Code of Ethics &#150; See Item 2</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">12(a)(2) &#150; Certifications &#150; Attached hereto</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">12(a)(3) &#150; Not Applicable</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">12(b) &#150; Certifications &#150; Attached hereto</FONT></P>

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<P style="TEXT-ALIGN: left"><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">12(c) &#150; Notices to the registrant&#146;s common shareholders in accordance with 1940 Act Section 19(a)</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and Rule 19a-1</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1</FONT></SUP></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1 </FONT></SUP><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The Fund has received exemptive relief from the Securities and Exchange Commission permitting it to make periodic</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">distributions of long-term capital gains with respect to its outstanding common stock as frequently as twelve times each year,</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and as frequently as distributions are specified by or in accordance with the terms of its outstanding preferred stock. This relief</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">is conditioned, in part, on an undertaking by the Fund to make the disclosures to the holders of the Fund&#146;s common shares, in</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">addition to the information required by Section 19(a) of the 1940 Act and Rule 19a-1 thereunder. The Fund is likewise</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">obligated to file with the SEC the information contained in any such notice to shareholders and, in that regard, has attached</FONT><BR>
<FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">hereto copies of each such notice made during the period.</FONT></P>
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<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the undersigned, thereunto duly authorized.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">By: </FONT><U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Anne F. Ackerley</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Anne F. Ackerley</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Executive Officer (principal executive officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Company Act of 1940, this report has been signed below by the following persons on behalf</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of the registrant and in the capacities and on the dates indicated.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">By: </FONT><U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Anne F. Ackerley</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Anne F. Ackerley</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Executive Officer (principal executive officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">By: </FONT><U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Neal J. Andrews</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Neal J. Andrews</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Financial Officer (principal financial officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT></P>

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end
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.19B
<SEQUENCE>6
<FILENAME>ciijune2010section19.htm
<DESCRIPTION>SECTION 19 NOTICE
<TEXT>

<HTML>
<HEAD>
   <TITLE>ciijune2010section19.htm - Produced by Pellegrini and Associates, Inc.  |  134 Spring Street New York NY 10012  |  (212) 925-5151</TITLE>
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<A name="page_1"></A><BR>

<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">CII</FONT><BR>
<FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock Enhanced Capital </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">Income </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fund, Inc.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=58%></TD>
     <TD width=41%></TD></TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cusip: 09256A109</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Ticker: CII</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Record Date</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">June 15, 2010</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Pay Date</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">June 30, 2010</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distribution Amount per share</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.48500</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">following </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">table sets forth the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimated amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">current distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">cumulative distributions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">paid this</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">fiscal year to date from the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">following sources: </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment income, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">short-term </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains, net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">long-</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">term </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains and return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">All </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">are </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">expressed </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">per </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">common </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">share.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=30%></TD>
     <TD width=17%></TD>
     <TD width=14%></TD>
     <TD width=10%></TD>
     <TD width=8%></TD>
     <TD width=18%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">% Breakdown of the</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">% Breakdown</FONT>&nbsp;</TD>
	<TD align=right colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total Cumulative</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total Cumulative</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the Current</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distributions for the</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distributions for the</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Current Distribution</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distribution</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fiscal Year to Date</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fiscal Year to Date</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Investment Income</FONT>&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.08849</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">18%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.21422</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">15%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Realized Short-Term Capital Gains</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Realized Long-Term Capital Gains</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Return of Capital</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.39651</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">82%</FONT>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 1.24078</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">85%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total (per common share)</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.48500</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">100%</FONT>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 1.45500</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">100%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Average annual total return (in relation to NAV) for the 5-year period ending on May 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">4.15%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Annualized current distribution rate expressed as a percentage of NAV as of May 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">13.58%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cumulative total return (in relation to NAV) for the fiscal year through May 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">5.71%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=3>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cumulative fiscal year distributions as a percentage of NAV as of May 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">6.79%</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">You should not draw any </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">conclusions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">about the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment performance </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">from the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amount </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of this </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">or from the terms of the</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Funds </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Managed Distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Plan.</FONT><BR>
<BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Fund </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimates </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">that it has </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributed </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">more than its </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">income </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains; </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">therefore, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">a </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">portion </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of your </FONT><FONT size=1 face="Trebuchet MS,Ari
al,Helvetica,sans-serif">distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">may be a</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">A return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">may occur, for </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">example, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">when some or all of the money that you </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">invested </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">in the Fund is paid back to you. A return</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">does not </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">necessarily reflect </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment performance </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and should not be </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">confused </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">with &#145;yield&#146; or </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#145;income&#146; </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">.</FONT><BR>
<BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">sources </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributions reported </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">in the Notice are only </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimates </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and are not being </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">provided </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">reporting purposes.</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The actual </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">sources </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">reporting purposes </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">will </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">depend </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">upon the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment experience </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">during the </FONT><FONT size=1 
face="Trebuchet MS,Arial,Helvetica,sans-serif">remainder</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of its fiscal year and may be </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">subject </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">to </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">changes </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">based on the tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">regulations. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Fund will send you a Form 1099-DIV for the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">calendar </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">year that will</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">tell you how to report these </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">federal income </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">purpose.</FONT><BR>
<BR>
<B><FONT size=1 face="TrebuchetMS-Bold,Arial,Helvetica,sans-serif">Contact Number: </FONT></B><B><FONT size=1 face="TrebuchetMS-Bold,Arial,Helvetica,sans-serif">888-825-2257</FONT></B></P>

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<DOCUMENT>
<TYPE>EX-99.19B
<SEQUENCE>7
<FILENAME>ciiseptember2010section19.htm
<DESCRIPTION>SECTION 19 NOTICE
<TEXT>

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   <TITLE>ciiseptember2010section19.htm - Produced by Pellegrini and Associates, Inc.  |  134 Spring Street New York NY 10012  |  (212) 925-5151</TITLE>
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<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">CII</FONT><BR>
<FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock Enhanced Capital </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">Income </FONT><FONT size=3 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fund, Inc.</FONT></P>
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<TABLE border=0 cellspacing=0>
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     <TD width=58%></TD>
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	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cusip: 09256A109</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Ticker: CII</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Record Date</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">September 15, 2010</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Pay Date</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">September 30, 2010</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distribution Amount per share</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.485000</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">following </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">table sets forth the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimated amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">current distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">cumulative distributions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">paid this</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">fiscal year to date from the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">following sources: </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment income, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">short-term </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains, net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">long-</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">term </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains and return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">All </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">are </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">expressed </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">per </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">common </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">share.</FONT></P>
<DIV align="left">
<TABLE border=0 cellspacing=0>
<TR>
     <TD width=30%></TD>
     <TD width=17%></TD>
     <TD width=15%></TD>
     <TD width=8%></TD>
     <TD width=9%></TD>
     <TD width=18%></TD></TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">% Breakdown of the</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">% Breakdown</FONT>&nbsp;</TD>
	<TD align=right colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total Cumulative</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total Cumulative</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the Current</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distributions for the</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distributions for the</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Current Distribution</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Distribution</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fiscal Year to Date</FONT>&nbsp;</TD>
	<TD align=center>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Fiscal Year to Date</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Investment Income</FONT>&nbsp;</TD>
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.040989</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">8%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.292134</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">15%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Realized Short-Term Capital Gains</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Net Realized Long-Term Capital Gains</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
	<TD align=left colspan=2>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; -</FONT>&nbsp;</TD>
	<TD align=right>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">0%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Return of Capital</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.444011</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">92%</FONT>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 1.647866</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">85%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Total (per common share)</FONT>&nbsp;</TD>
	<TD align=left style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 0.485000</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">100%</FONT>&nbsp;</TD>
	<TD align=left colspan=2 style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#36; 1.940000</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">100%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=5>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Average annual total return (in relation to NAV) for the 5-year period ending on August 31, 2010</FONT>&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">3.35%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Annualized current distribution rate expressed as a percentage of NAV as of August 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">14.09%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=4>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cumulative total return (in relation to NAV) for the fiscal year through August 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">5.57%</FONT>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left colspan=3>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Cumulative fiscal year distributions as a percentage of NAV as of August 31, 2010</FONT>&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=left>
&nbsp;</TD>
	<TD align=right style="border-bottom:1px solid #000000;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">10.57%</FONT>&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<P style="MARGIN:0px">&nbsp;</P>
<P style="text-align: left;">
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">You should not draw any </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">conclusions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">about the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment performance </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">from the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amount </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of this </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">or from the terms of the</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Funds </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Managed Distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">Plan.</FONT><BR>
<BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Fund </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimates </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">that it has </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributed </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">more than its </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">income </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and net </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">realized </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">gains; </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">therefore, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">a </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">portion </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of your </FONT><FONT size=1 face="Trebuchet MS,Ari
al,Helvetica,sans-serif">distribution </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">may be a</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">A return of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">may occur, for </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">example, </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">when some or all of the money that you </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">invested </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">in the Fund is paid back to you. A return</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">capital </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">does not </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">necessarily reflect </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment performance </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and should not be </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">confused </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">with &#145;yield&#146; or </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">&#145;income&#146; </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">.</FONT><BR>
<BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">sources </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributions reported </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">in the Notice are only </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">estimates </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and are not being </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">provided </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">reporting purposes.</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The actual </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">and </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">sources </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">amounts </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">reporting purposes </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">will </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">depend </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">upon the Fund&#146;s </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">investment experience </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">during the </FONT><FONT size=1 
face="Trebuchet MS,Arial,Helvetica,sans-serif">remainder</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">of its fiscal year and may be </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">subject </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">to </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">changes </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">based on the tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">regulations. </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Fund will send you a Form 1099-DIV for the </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">calendar </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">year that will</FONT><BR>
<FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">tell you how to report these </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">distributions </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">for </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">federal income </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">tax </FONT><FONT size=1 face="Trebuchet MS,Arial,Helvetica,sans-serif">purpose.</FONT><BR>
<BR>
<B><FONT size=1 face="TrebuchetMS-Bold,Arial,Helvetica,sans-serif">Contact Number: </FONT></B><B><FONT size=1 face="TrebuchetMS-Bold,Arial,Helvetica,sans-serif">888-825-2257</FONT></B></P>

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<TYPE>EX-99.CERT
<SEQUENCE>8
<FILENAME>ciiex99cert.htm
<DESCRIPTION>CERT
<TEXT>

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<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">EX-99.CERT</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE 1940 ACT AND SECTION 302 OF</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">THE SARBANES-OXLEY ACT OF 2002</FONT></B></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">I, Anne F. Ackerley, Chief Executive Officer (principal executive officer) of BlackRock Enhanced Capital and Income</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fund, Inc., certify that:</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1. I have reviewed this report on Form N-CSR of BlackRock Enhanced Capital and Income Fund, Inc.;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">material fact necessary to make the statements made, in light of the circumstances under which such statements were made,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">not misleading with respect to the period covered by this report;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">in this report;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">designed under our supervision, to ensure that material information relating to the registrant, including its</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">which this report is being prepared;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">b) designed such internal control over financial reporting, or caused such internal control over financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial reporting and the preparation of financial statements for external purposes in accordance with generally</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accepted accounting principles;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">days prior to the filing date of this report, based on such evaluation; and</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">d) disclosed in this report any change in the registrant's internal control over financial reporting that</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reasonably likely to materially affect, the registrant's internal control over financial reporting; and</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of the registrant's board of directors (or persons performing the equivalent functions):</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a) all significant deficiencies and material weaknesses in the design or operation of internal control over</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">summarize, and report financial information; and</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">b) any fraud, whether or not material, that involves management or other employees who have a significant</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">role in the registrant's internal control over financial reporting.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT><BR>
<BR>
<U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Anne F. Ackerley</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Anne F. Ackerley</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Executive Officer (principal executive officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>

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<P style="text-align: left;">
<B><FONT size=2 face="Arial-BoldMT,Arial,Helvetica,sans-serif">EX-99.CERT</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">CERTIFICATION PURSUANT TO RULE 30a-2(a) UNDER THE 1940 ACT AND SECTION 302 OF</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">THE SARBANES-OXLEY ACT OF 2002</FONT></B></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">I, Neal J. Andrews, Chief Financial Officer (principal financial officer) of BlackRock Enhanced Capital and Income Fund,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Inc., certify that:</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1. I have reviewed this report on Form N-CSR of BlackRock Enhanced Capital and Income Fund, Inc.;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">material fact necessary to make the statements made, in light of the circumstances under which such statements were made,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">not misleading with respect to the period covered by this report;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">in this report;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">designed under our supervision, to ensure that material information relating to the registrant, including its</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">which this report is being prepared;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">b) designed such internal control over financial reporting, or caused such internal control over financial</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial reporting and the preparation of financial statements for external purposes in accordance with generally</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">accepted accounting principles;</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">days prior to the filing date of this report, based on such evaluation; and</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">d) disclosed in this report any change in the registrant's internal control over financial reporting that</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reasonably likely to materially affect, the registrant's internal control over financial reporting; and</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of the registrant's board of directors (or persons performing the equivalent functions):</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">a) all significant deficiencies and material weaknesses in the design or operation of internal control over</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">summarize, and report financial information; and</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">b) any fraud, whether or not material, that involves management or other employees who have a significant</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">role in the registrant's internal control over financial reporting.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT><BR>
<BR>
<U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Neal J. Andrews</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Neal J. Andrews</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Financial Officer (principal financial officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>

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<DOCUMENT>
<TYPE>EX-99.906 CERT
<SEQUENCE>9
<FILENAME>ciisec906.htm
<DESCRIPTION>CERT
<TEXT>

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<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Exhibit 99.1350CERT</FONT></P>
<P style="text-align: center;">
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Certification Pursuant to Rule 30a-2(b) under the 1940 Act and</FONT></B><BR>
<B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Section 906 of the Sarbanes Oxley Act</FONT></B></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pursuant to 18 U.S.C. &#167; 1350, the undersigned officer of BlackRock Enhanced Capital and Income Fund, Inc. (the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;Registrant&#148;), hereby certifies, to the best of her knowledge, that the Registrant&#146;s Report on Form N-CSR for the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">period ended October 31, 2010 (the &#147;Report&#148;) fully complies with the requirements of Section 13(a) of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">material respects, the financial condition and results of operations of the Registrant.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT></P>
<P style="text-align: left;">
<U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Anne F. Ackerley</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Anne F. Ackerley</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Executive Officer (principal executive officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pursuant to 18 U.S.C. &#167; 1350, the undersigned officer of BlackRock Enhanced Capital and Income Fund, Inc. (the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;Registrant&#148;), hereby certifies, to the best of his knowledge, that the Registrant&#146;s Report on Form N-CSR for the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">period ended October 31, 2010 (the &#147;Report&#148;) fully complies with the requirements of Section 13(a) of the</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">material respects, the financial condition and results of operations of the Registrant.</FONT><BR>
<BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: January 5, 2011</FONT></P>
<P style="text-align: left;">
<U><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">/s/ Neal J. Andrews</FONT></U><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Neal J. Andrews</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Chief Financial Officer (principal financial officer) of</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">BlackRock Enhanced Capital and Income Fund, Inc.</FONT></P>
<P style="text-align: left;">
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">This certification is being furnished pursuant to Rule 30a-2(b) under the Investment Company Act of 1940, as</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">amended, and 18 U.S.C. Section 1350 and is not being filed as part of the Form N-CSR with the Securities and</FONT><BR>
<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Exchange Commission</FONT><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">.</FONT></B></P>

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<DOCUMENT>
<TYPE>EX-99.PROXYPOL
<SEQUENCE>10
<FILENAME>proxyvotingpolicyblackrockfu.htm
<DESCRIPTION>PROXY POLICY
<TEXT>

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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>CONFIDENTIAL</FONT></B></P>
<P style="TEXT-ALIGN: left"><U><FONT size=6 face="Trebuchet MS,Arial,Helvetica,sans-serif">Proxy Voting Policies</FONT></U></P>
<P style="TEXT-ALIGN: left"><FONT size=5 face="Trebuchet MS,Arial,Helvetica,sans-serif">For The BlackRock-Advised Funds</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=5 face="Trebuchet MS,Arial,Helvetica,sans-serif">December, 2009</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Copyright &#169; 2010 BlackRock, Inc.</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">All rights reserved.</FONT></P>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>CONFIDENTIAL</FONT></B>&nbsp;</TD></TR>
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     <TD colSpan=3 align=center><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Table of Contents</FONT></TD></TR>
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     <TD align=left>&nbsp;</TD>
     <TD align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 12px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Page</FONT>&nbsp;</TD></TR>
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     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>I.</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>INTRODUCTION</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1</FONT>&nbsp;</TD></TR>
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     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>II.</FONT></B>&nbsp;</TD>
     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>PROXY VOTING POLICIES</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">A.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Boards of Directors</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">2</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">B.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Auditors</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">2</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">C.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Compensation and Benefits</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">2</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">D.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Capital Structure</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">2</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">E.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Corporate Charter and By-Laws</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">3</FONT>&nbsp;</TD></TR>
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     <TD style="TEXT-INDENT: 2px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">F.</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Environmental and Social Issues</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">3</FONT>&nbsp;</TD></TR>
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     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>III.</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>CONFLICTS MANAGEMENT</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3</FONT>&nbsp;</TD></TR>
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     <TD align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>IV.</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 3px" align=left><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>REPORTS TO THE BOARD</FONT></B>&nbsp;</TD>
     <TD style="TEXT-INDENT: 18px" align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3</FONT>&nbsp;</TD></TR></TABLE></DIV>
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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>I. INTRODUCTION</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Trustees/Directors (&#147;Directors&#148;) of the BlackRock-Advised Funds (the &#147;Funds&#148;) have</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">the responsibility for voting proxies relating to portfolio securities of the Funds, and have</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">determined that it is in the best interests of the Funds and their shareholders to delegate</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">that responsibility to BlackRock Advisors, LLC and its affiliated U.S. registered investment</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">advisers (&#147;BlackRock&#148;), the investment adviser to the Funds, as part of BlackRock&#146;s</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">authority to manage, acquire and dispose of account assets. The Directors hereby direct</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock to vote such proxies in accordance with this Policy, and any proxy voting</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">guidelines that the Adviser determines are appropriate and in the best interests of the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Funds&#146; shareholders and which are consistent with the principles outlined in this Policy.</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Directors have authorized BlackRock to utilize an unaffiliated third-party as its agent</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">to vote portfolio proxies in accordance with this Policy and to maintain records of such</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">portfolio proxy voting.</FONT><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Rule 206(4)-6 under the Investment Advisers Act of 1940 requires, among other things, that</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">an investment adviser that exercises voting authority over clients&#146; proxy voting adopt</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">policies and procedures reasonably designed to ensure that the adviser votes proxies in the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">best interests of clients, discloses to its clients information about those policies and</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">procedures and also discloses to clients how they may obtain information on how the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">adviser has voted their proxies.</FONT><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock has adopted separate but substantially similar guidelines and procedures that</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">are consistent with the principles of this Policy. BlackRock&#146;s Corporate Governance</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Committee (the &#147;Committee&#148;), addresses proxy voting issues on behalf of BlackRock and</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">its clients, including the Funds. The Committee is comprised of senior members of</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock&#146;s Portfolio Management and Administration Groups and is advised by</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock&#146;s Legal and Compliance Department.</FONT><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock votes (or refrains from voting) proxies for each Fund in a manner that</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock, in the exercise of its independent business judgment, concludes are in the best</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">economic interests of such Fund. In some cases, BlackRock may determine that it is in the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">best economic interests of a Fund to refrain from exercising the Fund&#146;s proxy voting rights</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">(such as, for example, proxies on certain non-U.S. securities that might impose costly or</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">time-consuming in-person voting requirements). With regard to the relationship between</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">securities lending and proxy voting, BlackRock&#146;s approach is also driven by our clients&#146;</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">economic interests. The evaluation of the economic desirability of recalling loans</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">involves balancing the revenue producing value of loans against the likely economic value</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">of casting votes. Based on our evaluation of this relationship, BlackRock believes that the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">likely economic value of casting a vote generally is less than the securities lending income,</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">either because the votes will not have significant economic consequences or because the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">outcome of the vote would not be affected by BlackRock recalling loaned securities in</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">order to ensure they are voted. Periodically, BlackRock analyzes the process and benefits</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">of voting proxies for securities on loan, and will consider whether any modification of its</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">proxy voting policies or procedures are necessary in light of any regulatory changes.</FONT><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock will normally vote on specific proxy issues in accordance with BlackRock&#146;s proxy</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">voting guidelines. BlackRock&#146;s proxy voting guidelines provide detailed guidance as to how</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">to vote proxies on certain important or commonly raised issues. BlackRock may, in the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">exercise of its business judgment, conclude that the proxy voting guidelines do not cover</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">the specific matter upon which a proxy vote is requested, or that an exception to the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">proxy voting guidelines would be in the best economic interests of a Fund. BlackRock</FONT></P>
<P style="TEXT-ALIGN: center"><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">1</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">votes (or refrains from voting) proxies without regard to the relationship of the issuer of</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">the proxy (or any shareholder of such issuer) to the Fund, the Fund&#146;s affiliates (if any),</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock or BlackRock&#146;s affiliates. When voting proxies, BlackRock attempts to</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">encourage companies to follow practices that enhance shareholder value and increase</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">transparency and allow the market to place a proper value on their assets.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>II. PROXY VOTING POLICIES</FONT></B><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>A. Boards of Directors</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">The Funds generally support the board&#146;s nominees in the election of directors and</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">generally support proposals that strengthen the independence of boards of directors. As a</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">general matter, the Funds believe that a company&#146;s board of directors (rather than</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">shareholders) is most likely to have access to important, nonpublic information regarding a</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">company&#146;s business and prospects, and is therefore best-positioned to set corporate policy</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">and oversee management. The Funds therefore believe that the foundation of good</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">corporate governance is the election of responsible, qualified, independent corporate</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">directors who are likely to diligently represent the interests of shareholders and oversee</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">management of the corporation in a manner that will seek to maximize shareholder value</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">over time. In individual cases, consideration may be given to a director nominee&#146;s history</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">of representing shareholder interests as a director of the company issuing the proxy or</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">other companies, or other factors to the extent deemed relevant by the Committee.</FONT><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>B. Auditors</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">These proposals concern those issues submitted to shareholders related to the selection of</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">auditors. As a general matter, the Funds believe that corporate auditors have a</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">responsibility to represent the interests of shareholders and provide an independent view</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">on the propriety of financial reporting decisions of corporate management. While the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">Funds anticipate that BlackRock will generally defer to a corporation&#146;s choice of auditor,</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">in individual cases, consideration may be given to an auditors&#146; history of representing</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">shareholder interests as auditor of the company issuing the proxy or other companies, to</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">the extent deemed relevant.</FONT><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>C. Compensation and Benefits</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">These proposals concern those issues submitted to shareholders related to management</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">compensation and employee benefits. As a general matter, the Funds favor disclosure of a</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">company&#146;s compensation and benefit policies and oppose excessive compensation, but</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">believe that compensation matters are normally best determined by a corporation&#146;s board</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">of directors, rather than shareholders. Proposals to &#147;micro-manage&#148; a company&#146;s</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">compensation practices or to set arbitrary restrictions on compensation or benefits should</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">therefore generally not be supported.</FONT><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>D. Capital Structure</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">These proposals relate to various requests, principally from management, for approval of</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">amendments that would alter the capital structure of a company, such as an increase in</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">authorized shares. As a general matter, the Funds expect that BlackRock will support</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">requests that it believes enhance the rights of common shareholders and oppose requests</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">that appear to be unreasonably dilutive.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">2</FONT></P>
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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>E. Corporate Charter and By-Laws</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">These proposals relate to various requests for approval of amendments to a corporation&#146;s</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">charter or by-laws. As a general matter, the Funds generally vote against anti-takeover</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">proposals and proposals that would create additional barriers or costs to corporate</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">transactions that are likely to deliver a premium to shareholders.</FONT><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>F. Environmental and Social Issues</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">These are shareholder proposals addressing either corporate social and environmental</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">policies or requesting specific reporting on these issues. The Funds generally do not</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">support proposals on social issues that lack a demonstrable economic benefit to the issuer</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">and the Fund investing in such issuer. BlackRock seeks to make proxy voting decisions in</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">the manner most likely to protect and promote the long-term economic value of the</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">securities held in client accounts. We intend to support economically advantageous</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">corporate practices while leaving direct oversight of company management and strategy to</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">boards of directors. We seek to avoid micromanagement of companies, as we believe that</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">a company&#146;s board of directors is best positioned to represent shareholders and oversee</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">management on shareholders behalf. Issues of corporate social and environmental</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">responsibility are evaluated on a case-by-case basis within this framework.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>III. CONFLICTS MANAGEMENT</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock maintains policies and procedures that are designed to prevent any relationship</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">between the issuer of the proxy (or any shareholder of the issuer) and a Fund, a Fund&#146;s</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">affiliates (if any), BlackRock or BlackRock&#146;s affiliates, from having undue influence on</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock&#146;s proxy voting activity. In certain instances, BlackRock may determine to</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">engage an independent fiduciary to vote proxies as a further safeguard against potential</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">conflicts of interest or as otherwise required by applicable law. The independent fiduciary</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">may either vote such proxies or provide BlackRock with instructions as to how to vote such</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">proxies. In the latter case, BlackRock votes the proxy in accordance with the independent</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">fiduciary&#146;s determination.</FONT><BR>
<BR>
<B><FONT size=2 face=TrebuchetMS-Bold,Arial,Helvetica,sans-serif>IV. REPORTS TO THE BOARD</FONT></B><BR>
<BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">BlackRock will report to the Directors on proxy votes it has made on behalf of the Funds at</FONT><BR>
<FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">least annually.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face="TimesNewRomanPSMT,Times New Roman,Times,serif">NY1 7275629V.2</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face="Trebuchet MS,Arial,Helvetica,sans-serif">3</FONT></P>
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