STATEMENT OF ADDITIONAL INFORMATION

BLACKROCK FUNDS V

100 Bellevue Parkway, Wilmington, Delaware 19809 • Phone No. (800) 441-7762

    

This Statement of Additional Information of BlackRock High Yield Bond Portfolio (“High Yield Bond Portfolio”), BlackRock Low Duration Bond Portfolio (“Low Duration Bond Portfolio”) and BlackRock Core Bond Portfolio (“Core Bond Portfolio” and collectively with the High Yield Bond Portfolio and the Low Duration Bond Portfolio, the “Funds” and each, a “Fund”), each a series of BlackRock Funds V (the “Trust”), is not a prospectus and should be read in conjunction with the Prospectuses of the Funds, dated January 27, 2023, as they may be amended or supplemented from time to time (collectively, the “Prospectuses” and each, a “Prospectus”), which have been filed with the Securities and Exchange Commission (the “Commission” or the “SEC”) and can be obtained, without charge, by calling (800) 441-7762 or by writing to the Funds at the above address. Each Fund’s Prospectuses are incorporated by reference into this Statement of Additional Information, and Part I of this Statement of Additional Information and the portions of Part II of this Statement of Additional Information that relate to the Funds have been incorporated by reference into each Fund’s Prospectuses. The portions of Part II of this Statement of Additional Information that do not relate to the Funds do not form a part of the Fund’s Statement of Additional Information, have not been incorporated by reference into each Fund’s Prospectuses and should not be relied upon by investors in the Funds. The audited financial statements of the Funds are incorporated into this Statement of Additional Information by reference to the Funds’ Annual Report to Shareholders for the fiscal year ended September 30, 2022 (the “Annual Report”). You may request a copy of the Annual Report at no charge by calling (800) 441-7762 between 8:00 a.m. and 6:00 p.m. Eastern time on any business day.

References to the Investment Company Act of 1940, as amended (the “Investment Company Act” or the “1940 Act”), or other applicable law, will include any rules promulgated thereunder and any guidance, interpretations or modifications by the Commission, Commission staff or other authority with appropriate jurisdiction, including court interpretations, and exemptive, no-action or other relief or permission from the Commission, Commission staff or other authority.

Class		BlackRock High Yield Bond Portfolio Ticker Symbol		BlackRock Low Duration Bond Portfolio Ticker Symbol		BlackRock Core Bond Portfolio Ticker Symbol
Investor A Shares		BHYAX		BLDAX		BCBAX
Investor A1 Shares		—		CMGAX		—
Investor C Shares		BHYCX		BLDCX		BCBCX
Institutional Shares		BHYIX		BFMSX		BFMCX
Class K Shares		BRHYX		CLDBX		CCBBX
Service Shares		BHYSX		—		—
Class R Shares		BHYRX		BLDPX		BCBRX

  

BlackRock Advisors, LLC — Manager

BlackRock Investments, LLC — Distributor

The date of this Statement of Additional Information is January 27, 2023.

TABLE OF CONTENTS

	Page
PART I
Investment Objectives and Policies	I-1
Investment Restrictions	I-6
Information on Trustees and Officers	I-9
Management, Advisory and Other Service Arrangements	I-19
Information on Sales Charges and Distribution Related Expenses	I-26
Computation of Offering Price Per Share	I-28
Portfolio Transactions and Brokerage	I-29
Additional Information	I-31
Financial Statements	I-36
PART II
Investment Risks and Considerations	II-1
Management and Other Service Arrangements	II-76
Selective Disclosure of Portfolio Holdings	II-78
Purchase of Shares	II-90
Redemption of Shares	II-107
Shareholder Services	II-109
Pricing of Shares	II-113
Portfolio Transactions and Brokerage	II-116
Dividends and Taxes	II-120
Performance Data	II-127
Proxy Voting Policies and Procedures	II-129
General Information	II-129
Appendix A — Description of Bond Ratings	A-1
Appendix B — Proxy Voting Policies	B-1

PART I: INFORMATION ABOUT The Funds

Part I of this Statement of Additional Information (“SAI”) sets forth information about the BlackRock High Yield Bond Portfolio (“High Yield Bond Portfolio”), BlackRock Low Duration Bond Portfolio (“Low Duration Bond Portfolio”) and BlackRock Core Bond Portfolio (“Core Bond Portfolio”) (collectively, the “Funds” and each, a “Fund”), each a series of BlackRock Funds V (the “Trust”). It includes information about the Trust’s Board of Trustees (the “Board” or the “Board of Trustees”), the management services provided to and the management fees paid by the Funds and information about other fees applicable to and services provided to the Funds. This Part I of this SAI should be read in conjunction with the Funds’ Prospectuses and those portions of Part II of this SAI that pertain to the Funds.

I. Investment Objectives and Policies

In implementing each Fund’s investment strategy, from time to time, BlackRock Advisors, LLC (“BlackRock” or the “Manager”), each Fund’s investment manager, may consider and employ techniques and strategies designed to minimize and defer the U.S. federal income taxes which may be incurred by shareholders in connection with their investment in such Fund.

Set forth below is a listing of some of the types of investments and investment strategies that the Funds may use, and the risks and considerations associated with those investments and investment strategies. Please see Part II of this SAI for further information on these investments and investment strategies. Information contained in Part II about the risks and considerations associated with investments and/or investment strategies applies only to the extent a Fund makes each type of investment or uses each investment strategy. Information that does not apply to the Funds does not form a part of the Funds’ SAI and should not be relied on by investors in the Funds.

Only information that is clearly identified as applicable to a Fund is considered to form a part of the Fund’s SAI.

	High Yield Bond Portfolio	Low Duration Bond Portfolio	Core Bond Portfolio
144A Securities	X	X	X
Asset-Backed Securities	X	X	X
Asset-Based Securities	X
Precious Metal-Related Securities	X
Borrowing and Leverage	X	X	X
Cash Flows; Expenses	X	X	X
Cash Management	X	X	X
Collateralized Debt Obligations	X	X	X
Collateralized Bond Obligations	X	X	X
Collateralized Loan Obligations	X	X	X
Commercial Paper	X	X	X
Commodity-Linked Derivative Instruments and Hybrid Instruments	X		X
Qualifying Hybrid Instruments
Hybrid Instruments Without Principal Protection
Limitations on Leverage
Counterparty Risk
Convertible Securities	X	X	X
Corporate Loans	X	X	X
Direct Lending			X
Credit Linked Securities	X	X	X
Cyber Security Issues	X	X	X
Debt Securities	X	X	X
Inflation-Indexed Bonds		X	X
Investment Grade Debt Obligations	X	X	X
High Yield Investments (“Junk Bonds”)	X	X

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	High Yield Bond Portfolio	Low Duration Bond Portfolio	Core Bond Portfolio
Mezzanine Investments	X	X
Pay-in-kind Bonds	X	X	X
Supranational Entities	X	X	X
Depositary Receipts (ADRs, EDRs and GDRs)	X	X	X
Derivatives	X	X	X
Hedging	X	X	X
Speculation	X	X	X
Risk Factors in Derivatives	X	X	X
Correlation Risk	X	X	X
Counterparty Risk	X	X	X
Credit Risk	X	X	X
Currency Risk	X	X	X
Illiquidity Risk	X	X	X
Leverage Risk	X	X	X
Market Risk	X	X	X
Valuation Risk	X	X	X
Volatility Risk	X	X	X
Futures	X	X	X
Swap Agreements	X	X	X
Credit Default Swaps and Similar Instruments	X	X	X
Interest Rate Swaps, Floors and Caps	X	X	X
Total Return Swaps	X	X	X
Options	X	X	X
Options on Securities and Securities Indices	X	X	X
Call Options	X	X	X
Put Options	X	X	X
Options on Government National Mortgage Association (“GNMA”) Certificates		X	X
Options on Swaps (“Swaptions”)	X	X	X
Foreign Exchange Transactions	X	X	X
Spot Transactions and FX Forwards	X	X	X
Currency Futures	X	X	X
Currency Options	X	X	X
Currency Swaps	X	X	X
Distressed Securities	X	X
Environmental, Social and Governance (“ESG”) Integration	X	X	X
Equity Securities	X	X	X
Real Estate-Related Securities	X
Securities of Smaller or Emerging Growth Companies	X

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	High Yield Bond Portfolio	Low Duration Bond Portfolio	Core Bond Portfolio
Exchange-Traded Notes (“ETNs”)
Foreign Investments	X	X	X
Foreign Investment Risks	X	X	X
Foreign Market Risk	X	X	X
Foreign Economy Risk	X	X	X
Currency Risk and Exchange Risk	X	X	X
Governmental Supervision and Regulation/Accounting Standards	X	X	X
Certain Risks of Holding Fund Assets Outside the United States	X	X	X
Publicly Available Information	X	X	X
Settlement Risk	X	X	X
Sovereign Debt	X	X	X
Withholding Tax Reclaims Risk	X	X	X
Funding Agreements	X	X	X
Guarantees	X	X	X
Illiquid Investments	X	X	X
Index Funds
Tracking Error Risk
S&P 500 Index
Russell Indexes
MSCI Indexes
FTSE Indexes
Bloomberg Indexes
ICE BofA Indexes
Indexed and Inverse Securities	X	X	X
Inflation Risk	X	X	X
Initial Public Offering (“IPO”) Risk	X	X	X
Interfund Lending Program	X	X	X
Borrowing, to the extent permitted by the Fund’s investment policies and restrictions	X	X	X
Lending, to the extent permitted by the Fund’s investment policies and restrictions		X	X
Investment in Emerging Markets	X	X	X
Brady Bonds		X
China Investments Risk	X	X	X
Investment in Other Investment Companies	X	X	X
Exchange-Traded Funds	X	X	X
Lease Obligations	X	X	X
LIBOR Risk	X	X	X
Life Settlement Investments
Liquidity Risk Management	X	X	X

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	High Yield Bond Portfolio	Low Duration Bond Portfolio	Core Bond Portfolio
Master Limited Partnerships	X	X	X
Merger Transaction Risk
Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks	X	X	X
Money Market Securities	X	X	X
Mortgage-Related Securities	X	X	X
Mortgage-Backed Securities	X	X	X
Collateralized Mortgage Obligations (“CMOs”)	X	X	X
Adjustable Rate Mortgage Securities	X	X	X
CMO Residuals			X
Stripped Mortgage-Backed Securities		X	X
Tiered Index Bonds
TBA Commitments	X	X	X
Mortgage Dollar Rolls	X	X	X
Net Interest Margin (NIM) Securities
Municipal Investments	X	X	X
Risk Factors and Special Considerations Relating to Municipal Bonds	X	X	X
Description of Municipal Bonds	X	X	X
General Obligation Bonds	X	X	X
Revenue Bonds	X	X	X
Private Activity Bonds (“PABs”)	X	X	X
Moral Obligation Bonds	X	X	X
Municipal Notes	X	X	X
Municipal Commercial Paper	X	X	X
Municipal Lease Obligations	X	X	X
Tender Option Bonds	X
Yields	X
Variable Rate Demand Obligations (“VRDOs”)	X	X	X
Transactions in Financial Futures Contracts on Municipal Indexes	X	X
Call Rights	X
Municipal Interest Rate Swap Transactions	X
Insured Municipal Bonds	X
Build America Bonds	X	X	X
Tax-Exempt Municipal Investments
Participation Notes	X
Portfolio Turnover Rates	X	X	X
Preferred Stock	X		X
Tax-Exempt Preferred Shares
Trust Preferred Securities	X		X

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	High Yield Bond Portfolio	Low Duration Bond Portfolio	Core Bond Portfolio
Real Estate Investment Trusts (“REITs”)	X	X	X
Recent Market Events	X	X	X
Repurchase Agreements and Purchase and Sale Contracts	X	X	X
Restricted Securities	X	X	X
Reverse Repurchase Agreements	X	X	X
Rights Offerings and Warrants to Purchase	X	X	X
Securities Lending	X	X	X
Short Sales	See note 1 below	X	X
Special Purpose Acquisition Companies	X
Standby Commitment Agreements	X	X	X
Stripped Securities	X	X	X
Structured Notes	X	X	X
Taxability Risk
Temporary Defensive Measures	X	X	X
U.S. Government Obligations	X	X	X
U.S. Treasury Obligations	X	X	X
U.S. Treasury Rolls	X	X
Utility Industries	X		X
When-Issued Securities, Delayed Delivery Securities and Forward Commitments	X	X	X
Yields and Ratings	X	X	X
Zero Coupon Securities	X	X	X

  

Additional Information on Investment Strategies

Each Fund.

Each Fund will normally invest at least 80% of the value of its total assets in debt securities.

Commercial Paper. The Core Bond Portfolio may purchase commercial paper rated (at the time of purchase) “A-1” by Standard and Poor’s (“S&P”) or “Prime-1” by Moody’s Investors Service, Inc. (“Moody’s”) or, when deemed advisable by the Fund’s adviser or sub-adviser, “high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch Ratings Inc., respectively. The High Yield Bond Portfolio and the Low Duration Bond Portfolio may purchase commercial paper of any rating. These ratings symbols are described in Appendix A.

High Yield Bond Portfolio.

Convertible Securities. The High Yield Bond Portfolio will treat investments in convertible debt securities as debt securities for purposes of its investment policies.

Non-Investment Grade Securities. The High Yield Bond Portfolio may invest in securities of any rating and may invest up to 10% of its assets (measured at the time of investment) in distressed securities that are in default or the issuers of which are in bankruptcy. Investments in distressed securities are speculative and involve significant risk.

Blocker Subsidiary. The High Yield Bond Portfolio has formed a wholly-owned Delaware subsidiary (the “Blocker Subsidiary”) to hold interests in certain of its portfolio companies to permit the High Yield Bond Portfolio to continue to meet the qualifications for taxation as a regulated investment company (“RIC”) under the Internal Revenue Code of 1986. The Blocker Subsidiary will qualify for the exclusion from the definition of the term investment company pursuant to Section 3(c)(7) of the Investment Company Act or will otherwise not be required to register as an investment company under the Investment Company Act. Entities such as the Blocker Subsidiary are typically organized as corporations or as limited liability companies or partnerships that elect to be taxed as corporations for U.S. federal income tax purposes and hold certain investments in pass-through tax entities (such as partnership interests or limited liability company interests) the gross revenue from which would be “bad income” for purposes of

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RIC qualification. The High Yield Bond Portfolio may not invest more than 25% of its total assets in the shares of the Blocker Subsidiary. The Blocker Subsidiary will be subject to federal corporation income tax. The Blocker Subsidiary’s distributions of its after-tax earnings to the High Yield Bond Portfolio will be “good income” for RIC qualification purposes, and will be treated as qualified dividend income (for non-corporate shareholders) and as eligible for the dividends received deduction (for corporate shareholders), or as returns of capital.

Low Duration Bond Portfolio, High Yield Bond Portfolio and Core Bond Portfolio.

Options and Futures Contracts. Low Duration Bond Portfolio, High Yield Bond Portfolio and Core Bond Portfolio may also purchase exchange-listed and over-the-counter put and call options on non-U.S. currencies.

Regulation Regarding Derivatives. The Commodity Futures Trading Commission (“CFTC”) subjects advisers to registered investment companies to regulation by the CFTC if a fund that is advised by the investment adviser either (i) invests, directly or indirectly, more than a prescribed level of its liquidation value in CFTC-regulated futures, options and swaps (“CFTC Derivatives”), or (ii) markets itself as providing investment exposure to such instruments. The CFTC also subjects advisers to registered investment companies to regulation by the CFTC if the registered investment company invests in one or more commodity pools. To the extent the High Yield Bond Portfolio and Low Duration Bond Portfolio use CFTC Derivatives, each intends to do so below such prescribed levels and will not market itself as a “commodity pool” or a vehicle for trading such instruments.

The High Yield Bond Portfolio and Low Duration Bond Portfolio may have investments in “underlying funds” (and such underlying funds themselves may invest in underlying funds) not advised by BlackRock (which for purposes of the no-action letter referenced below may include certain securitized vehicles, mortgage real estate investment trusts and/or investment companies that may invest in CFTC Derivatives), and therefore may be viewed by the CFTC as a commodity pool. BlackRock has no transparency into the holdings of these underlying funds because they are not advised by BlackRock. To address this issue of lack of transparency, the CFTC staff issued a no-action letter on November 29, 2012 permitting the adviser of a fund that invests in such underlying funds and that would otherwise have filed a claim of exclusion pursuant to Rule 4.5 to delay registration as a “commodity pool operator” until six months from the date on which the CFTC issues additional guidance on the treatment of CFTC Derivatives held by underlying funds. BlackRock, the adviser to the High Yield Bond Portfolio and Low Duration Bond Portfolio, has filed a claim with the CFTC for the High Yield Bond Portfolio and Low Duration Bond Portfolio to rely on this no-action relief. Accordingly, BlackRock is not subject to registration or regulation as a “commodity pool operator” under the Commodity Exchange Act with respect to these two Funds.

Due to Core Bond Portfolio’s potential use of CFTC Derivatives above the prescribed levels, however, this Fund will be considered a “commodity pool” under the Commodity Exchange Act. Accordingly, BlackRock, the investment adviser to the Core Bond Portfolio, has registered as a “commodity pool operator” and is subject to CFTC regulation in respect of the Fund.

II. Investment Restrictions

Each Fund has adopted restrictions and policies relating to the investment of each Fund’s assets and its activities. Certain of the restrictions are fundamental policies of a Fund and may not be changed without the approval of the holders of a majority of the Fund’s outstanding voting securities (which for this purpose and under the Investment Company Act means the lesser of (i) 67% of the shares represented at a meeting at which more than 50% of the outstanding shares are represented or (ii) more than 50% of the outstanding shares).

Restrictions Applicable to the High Yield Bond Portfolio

Under these fundamental investment restrictions, the Fund may not:

Purchase securities of any one issuer (other than securities issued or guaranteed by the U.S. Government, its agencies or instrumentalities or certificates of deposit for any such securities) if more than 5% of the value of the Fund’s total assets would (taken at current value) be invested in the securities of such issuer, or more than 10% of the issuer’s outstanding voting securities would be owned by the Fund or the Trust, except that up to 25% of the value of the Fund’s total assets may (taken at current value) be invested without regard to these limitations. For purposes of this limitation, a security is considered to be issued by the entity (or entities) whose assets and revenues back the security. A guarantee of a security shall not be deemed to be a security issued by the guarantors when the value of all securities issued and guaranteed by the guarantor, and owned by the Fund, does not exceed 10% of the value of the Fund’s total assets.

Under these fundamental investment restrictions, the Fund may not:

1. Purchase any securities which would cause 25% or more of the value of the Fund’s total assets at the time of purchase to be invested in the securities of one or more issuers conducting their principal business activities in the same industry, provided that (a) there is no limitation with respect to (i) instruments issued or guaranteed by the United States and tax exempt instruments issued by any state, territory or possession of the United States, the District of Columbia or any of their authorities, agencies, instrumentalities or political subdivisions, and (ii) repurchase agreements secured by the instruments described in clause (i); (b) wholly-owned finance companies will be considered to be in the industries of their parents if their activities are primarily related to financing the

I-6

activities of the parents; and (c) utilities will be divided according to their services; for example, gas, gas transmission, electric and gas, electric and telephone will each be considered a separate industry.

2. Issue senior securities, borrow money or pledge its assets, except that the Fund may borrow from banks or enter into reverse repurchase agreements or dollar rolls in amounts aggregating not more than 33 ¹⁄3% of the value of its total assets (calculated when the loan is made) to take advantage of investment opportunities and may pledge up to 33 ¹⁄3% of the value of its total assets to secure such borrowings. The Fund is also authorized to borrow an additional 5% of its total assets without regard to the foregoing limitations for temporary purposes such as clearance of portfolio transactions and share redemptions. For purposes of these restrictions, the purchase or sale of securities on a “when-issued,” delayed delivery or forward commitment basis, the purchase and sale of options and futures contracts and collateral arrangements with respect thereto are not deemed to be the issuance of a senior security, a borrowing or a pledge of assets.

3. Purchase or sell real estate, except that the Fund may purchase securities of issuers which deal in real estate and may purchase securities which are secured by interests in real estate.

4. Acquire any other investment company or investment company security except in connection with a merger, consolidation, reorganization or acquisition of assets or where otherwise permitted by the Investment Company Act.

5. Act as an underwriter of securities within the meaning of the Securities Act of 1933, as amended, except to the extent that the purchase of obligations directly from the issuer thereof, or the disposition of securities, in accordance with the Fund’s investment objective, policies and limitations may be deemed to be underwriting.

6. Write or sell put options, call options, straddles, spreads, or any combination thereof, except for transactions in options on securities and securities indices, futures contracts and options on futures contracts.

7. Purchase securities of companies for the purpose of exercising control.

8. Purchase securities on margin, make short sales of securities or maintain a short position, except that (a) this investment limitation shall not apply to the Fund’s transactions in futures contracts and related options or the Fund’s sale of securities short against the box, and (b) the Fund may obtain short-term credit as may be necessary for the clearance of purchases and sales of portfolio securities.

9. Purchase or sell commodity contracts, or invest in oil, gas or mineral exploration or development programs, except that the Fund may, to the extent appropriate to its investment policies, purchase securities of companies engaging in whole or in part in such activities and may enter into futures contracts and related options.

10. Make loans, except that the Fund may purchase and hold debt instruments and enter into repurchase agreements in accordance with its investment objective and policies and may lend portfolio securities. See “Securities Lending” in Part II of this SAI.

11. Purchase or sell commodities except that the Fund may, to the extent appropriate to its investment policies, purchase securities of companies engaging in whole or in part in such activities, may engage in currency transactions and may enter into futures contracts and related options.

Notations Regarding the Fund’s Fundamental Investment Restrictions

The following notations are not considered part of the Fund’s fundamental investment restrictions and are subject to change without shareholder approval.

With respect to the fundamental policy relating to issuing senior securities above, the Investment Company Act, including the rules and regulations thereunder, generally prohibits the Fund from issuing senior securities (other than certain temporary borrowings) unless immediately after the issuance the Fund has satisfied an asset coverage requirement with respect to senior securities representing indebtedness prescribed by the Investment Company Act. Certain trading practices and investments, such as derivatives transactions, may be treated as senior securities. Prior to the adoption and implementation of Rule 18f-4 under the Investment Company Act, when the Fund engaged in a derivatives transaction that creates future payment obligations, consistent with SEC staff guidance and interpretations, the Fund was permitted to segregate or earmark liquid assets, or enter into an offsetting position, in an amount at least equal to the Fund’s exposure, on a mark-to-market basis, to the transaction, instead of meeting the asset coverage requirement with respect to senior securities prescribed by the Investment Company Act. The SEC staff guidance and interpretations were rescinded in connection with the adoption of Rule 18f-4, and the Fund now complies with Rule 18f-4 with respect to its derivatives transactions. Thus, the fundamental policy relating to issuing senior securities above will not restrict the Fund from entering into derivatives transactions that are treated as senior securities so long as the Fund complies with Rule 18f-4 with respect to such derivatives transactions.

While certain swaps are now considered commodity interests for purposes of the Commodity Exchange Act and the rules thereunder, at the time of the Fund’s adoption of fundamental investment restrictions no. 6, 9 and 11 above, many swaps were treated as securities for purposes of the Fund’s compliance with applicable law. Accordingly, fundamental investment restriction no. 6, which does not restrict transactions in options on securities and securities indices, and fundamental restrictions no. 9 and 11 are being interpreted to permit the Fund to engage in transactions in swaps and options on swaps, as applicable, related to financial instruments, such as securities,

I-7

securities indices and currencies, but not to engage in transactions in swaps or options on swaps related to physical commodities, such as oil or metals.

Under its non-fundamental investment restrictions, which may be changed by the Board without shareholder approval the Fund may not:

(a) Purchase securities of other investment companies, except to the extent permitted by the Investment Company Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds” provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased by another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).

Unless otherwise indicated, all limitations under the Fund’s fundamental or non-fundamental investment restrictions apply only at the time that a transaction is undertaken. Any change in the percentage of the Fund’s assets invested in certain securities or other instruments resulting from market fluctuations or other changes in the Fund’s total assets will not require the Fund to dispose of an investment until the adviser or sub-adviser determines that it is practicable to sell or close out the investment without undue market or tax consequences.

Restrictions Applicable to the Core Bond Portfolio and the Low Duration Bond Portfolio

Under these fundamental investment restrictions, each Fund may not:

1. Concentrate its investments in a particular industry, as that term is used in the Investment Company Act.

2. Borrow money, except as permitted under the Investment Company Act.

3. Issue senior securities to the extent such issuance would violate the Investment Company Act.

4. Purchase or hold real estate, except the Fund may purchase and hold securities or other instruments that are secured by, or linked to, real estate or interests therein, securities of real estate investment trusts, mortgage-related securities and securities of issuers engaged in the real estate business, and the Fund may purchase and hold real estate as a result of the ownership of securities or other instruments.

5. Underwrite securities issued by others, except to the extent that the sale of portfolio securities by the Fund may be deemed to be an underwriting or as otherwise permitted by applicable law.

6. Purchase or sell commodities or commodity contracts, except as permitted by the Investment Company Act.

7. Make loans to the extent prohibited by the Investment Company Act.

8. Make any investment inconsistent with the Fund’s classification as a diversified company under the Investment Company Act.

Notations Regarding the Funds’ Fundamental Investment Restrictions

The following notations are not considered to be part of each Fund’s fundamental investment restrictions and are subject to change without shareholder approval.

With respect to the fundamental policy relating to concentration set forth in (1) above, the Investment Company Act does not define what constitutes “concentration” in an industry. The Commission staff has taken the position that investment of 25% or more of a fund’s total assets in one or more issuers conducting their principal activities in the same industry or group of industries constitutes concentration. It is possible that interpretations of concentration could change in the future. The policy in (1) above will be interpreted to refer to concentration as that term may be interpreted from time to time. The policy also will be interpreted to permit investment without limit in the following: securities of the U.S. government and its agencies or instrumentalities; securities of state, territory, possession or municipal governments and their authorities, agencies, instrumentalities or political subdivisions; and repurchase agreements collateralized by any such obligations. Accordingly, issuers of the foregoing securities will not be considered to be members of any industry. There also will be no limit on investment in issuers domiciled in a single jurisdiction or country. Finance companies will be considered to be in the industries of their parents if their activities are primarily related to financing the activities of the parents. Each foreign government will be considered to be a member of a separate industry. With respect to the Fund’s industry classifications, the Fund currently utilizes any one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by Fund management. The policy also will be interpreted to give broad authority to the Fund as to how to classify issuers within or among industries.

With respect to the fundamental policy relating to borrowing money set forth above, the Investment Company Act permits the Fund to borrow money in amounts of up to one-third of the Fund’s total assets from banks for any purpose, and to borrow up to 5% of the Fund’s total assets from banks or other lenders for temporary purposes. (The Fund’s total assets include the amounts being borrowed.) In addition, the Fund has received an exemptive order from the SEC permitting it to borrow through the Interfund Lending Program (discussed below), subject to the conditions of the exemptive order. To limit the risks attendant to borrowing, the Investment Company Act requires the Fund to maintain at all times an “asset coverage” of at least 300% of the amount of its borrowings. Asset coverage means the ratio that the value of the Fund’s total assets (including amounts borrowed), minus liabilities other than borrowings, bears to the aggregate amount of all borrowings. Borrowing money to increase portfolio holdings is

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known as “leveraging.” Certain trading practices and investments, such as reverse repurchase agreements, may be considered to be borrowings or involve leverage and thus are subject to the Investment Company Act restrictions. In accordance with Rule 18f-4 under the Investment Company Act, when the Fund engages in reverse repurchase agreements and similar financing transactions, the Fund may either (i) maintain asset coverage of at least 300% with respect to such transactions and any other borrowings in the aggregate, or (ii) treat such transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to such transactions. Short-term credits necessary for the settlement of securities transactions and arrangements with respect to securities lending will not be considered to be borrowings under the policy. Practices and investments that may involve leverage but are not considered to be borrowings are not subject to the policy.

With respect to the fundamental policy relating to underwriting set forth in (5) above, the Investment Company Act does not prohibit the Fund from engaging in the underwriting business or from underwriting the securities of other issuers; in fact, in the case of diversified funds, the Investment Company Act permits the Fund to have underwriting commitments of up to 25% of its assets under certain circumstances. Those circumstances currently are that the amount of the Fund’s underwriting commitments, when added to the value of the Fund’s investments in issuers where the Fund owns more than 10% of the outstanding voting securities of those issuers, cannot exceed the 25% cap. A fund engaging in transactions involving the acquisition or disposition of portfolio securities may be considered to be an underwriter under the Securities Act of 1933, as amended (the “Securities Act”). Although it is not believed that the application of the Securities Act provisions described above would cause the Fund to be engaged in the business of underwriting, the policy in (5) above will be interpreted not to prevent the Fund from engaging in transactions involving the acquisition or disposition of portfolio securities, regardless of whether the Fund may be considered to be an underwriter under the Securities Act or is otherwise engaged in the underwriting business to the extent permitted by applicable law.

With respect to the fundamental policy relating to lending set forth in (7) above, the Investment Company Act does not prohibit the Fund from making loans (including lending its securities); however, Commission staff interpretations currently prohibit funds from lending more than one-third of their total assets (including lending its securities), except through the purchase of debt obligations or the use of repurchase agreements. In addition, collateral arrangements with respect to options, forward currency and futures transactions and other derivative instruments (as applicable), as well as delays in the settlement of securities transactions, will not be considered loans.

The Fund is currently classified as a diversified fund under the Investment Company Act. This means that the Fund may not purchase securities of an issuer (other than (i) obligations issued or guaranteed by the U.S. government, its agencies or instrumentalities and (ii) securities of other investment companies) if, with respect to 75% of its total assets, (a) more than 5% of the Fund’s total assets would be invested in securities of that issuer or (b) the Fund would hold more than 10% of the outstanding voting securities of that issuer. With respect to the remaining 25% of its total assets, the Fund can invest more than 5% of its assets in one issuer. Under the Investment Company Act, the Fund cannot change its classification from diversified to non-diversified without shareholder approval.

Under its non-fundamental investment restrictions, which may be changed by the Board without shareholder approval, each Fund may not:

a. Purchase securities of other investment companies, except to the extent permitted by the Investment Company Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds” provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased by another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).

Unless otherwise indicated, all limitations under a Fund’s fundamental or non-fundamental investment restrictions apply only at the time that a transaction is undertaken. Any change in the percentage of the Fund’s assets invested in certain securities or other instruments resulting from market fluctuations or other changes in the Fund’s total assets will not require the Fund to dispose of an investment until the adviser or sub-adviser determines that it is practicable to sell or close out the investment without undue market or tax consequences.

III. Information on Trustees and Officers

The Board consists of ten individuals (each a “Trustee”), eight of whom are not “interested persons” of the Trust as defined in the Investment Company Act (the “Independent Trustees”). The registered investment companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund Complex”). The Fund is included in the BlackRock Fund Complex referred to as the BlackRock Fixed-Income Complex. The Trustees also oversee as board members the operations of the other open-end and closed-end registered investment companies included in the BlackRock Fixed-Income Complex.

The Board has overall responsibility for the oversight of the Trust. The Chair of the Board and the Chief Executive Officer are different people. Not only is the Chair of the Board an Independent Trustee, but also the Chair of each

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Board committee (each, a “Committee”) is an Independent Trustee. The Board has five standing Committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee, a Performance Oversight Committee and an Executive Committee. The role of the Chair of the Board is to preside over all meetings of the Board and to act as a liaison with service providers, officers, attorneys, and other Trustees between meetings. The Chair of each Committee performs a similar role with respect to the Committee. The Chair of the Board or a Committee may also perform such other functions as may be delegated by the Board or the Committee from time to time. The Independent Trustees meet regularly outside the presence of Fund management, in executive sessions or with other service providers to the Funds. The Board has regular meetings five times a year, including a meeting to consider the approval of the Funds’ investment management agreement, and, if necessary, may hold special meetings before its next regular meeting. Each Committee meets regularly to conduct the oversight functions delegated to that Committee by the Board and reports its findings to the Board. The Board and each standing Committee conduct annual assessments of their oversight function and structure. The Board has determined that the Board’s leadership structure is appropriate because it allows the Board to exercise independent judgment over management and to allocate areas of responsibility among Committees and the Board to enhance oversight.

The Board decided to separate the roles of Chief Executive Officer from the Chair because it believes that having an independent Chair:

•	increases the independent oversight of the Funds and enhances the Board’s objective evaluation of the Chief Executive Officer;
•	allows the Chief Executive Officer to focus on the Funds’ operations instead of Board administration;
•	provides greater opportunities for direct and independent communication between shareholders and the Board; and
•	provides an independent spokesman for the Funds.

The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is responsible for overseeing the Manager, other service providers, the operations of the Fund and associated risks in accordance with the provisions of the Investment Company Act, state law, other applicable laws, the Funds’ charter, and the Funds’ investment objectives and strategies. The Board reviews, on an ongoing basis, each Fund’s performance, operations, and investment strategies and techniques. The Board also conducts reviews of the Manager and its role in running the operations of the Funds.

Day-to-day risk management with respect to each Fund is the responsibility of the Manager, sub-advisers or other service providers (depending on the nature of the risk), subject to the supervision of the Manager. Each Fund is subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While there are a number of risk management functions performed by the Manager, sub-advisers or other service providers, as applicable, it is not possible to eliminate all of the risks applicable to the Funds. Risk oversight is part of the Board’s general oversight of each Fund and is addressed as part of various Board and Committee activities. The Board, directly or through Committees, also reviews reports from, among others, management, the independent registered public accounting firm for each Fund, the Manager, sub-advisers and internal auditors for the Manager or its affiliates, as appropriate, regarding risks faced by each Fund and management’s or the service provider’s risk functions. The Committee system facilitates the timely and efficient consideration of matters by the Trustees and facilitates effective oversight of compliance with legal and regulatory requirements and of each Fund’s activities and associated risks. The Board has approved the appointment of a Chief Compliance Officer (“CCO”), who oversees the implementation and testing of the Funds’ compliance program and reports regularly to the Board regarding compliance matters for the Funds and their service providers. The Independent Trustees have engaged independent legal counsel to assist them in performing their oversight responsibilities.

Audit Committee. The Board has a standing Audit Committee composed of Catherine A. Lynch (Chair), Frank J. Fabozzi, Lorenzo A. Flores and J. Phillip Holloman, all of whom are Independent Trustees. The principal responsibilities of the Audit Committee are to assist the Board in fulfilling its oversight responsibilities relating to the accounting and financial reporting policies and practices of the Funds. The Audit Committee’s responsibilities include, without limitation: (i) approving, and recommending to the full Board for approval, the selection, retention, termination and compensation of the Funds’ independent registered public accounting firm (the “Independent Registered Public Accounting Firm”) and evaluating the independence and objectivity of the Independent Registered Public Accounting Firm; (ii) approving all audit engagement terms and fees for the Funds; (iii) reviewing the conduct and results of each audit; (iv) reviewing any issues raised by the Funds’ Independent Registered Public Accounting Firm or management regarding the accounting or financial reporting policies and practices of the Funds, its internal controls, and, as appropriate, the internal controls of certain service providers and management’s response to any such issues; (v) reviewing and discussing the Funds’ audited and unaudited financial statements and disclosure in the Funds’ shareholder reports relating to the Funds’ performance; (vi) assisting the Board’s responsibilities with respect to the internal controls of the Funds and its service providers with respect to accounting and financial matters; and (vii) resolving any disagreements between the Funds’ management and the Funds’ Independent

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Registered Public Accounting Firm regarding financial reporting. The Board has adopted a written charter for the Board’s Audit Committee. During the fiscal year ended September 30, 2022, the Audit Committee met thirteen times.

Governance and Nominating Committee. The Board has a standing Governance and Nominating Committee composed of W. Carl Kester (Chair), Cynthia L. Egan, J. Phillip Holloman, R. Glenn Hubbard and Catherine A. Lynch, all of whom are Independent Trustees. The principal responsibilities of the Governance and Nominating Committee are: (i) identifying individuals qualified to serve as Independent Trustees and recommending Board nominees that are not “interested persons” of the Funds (as defined in the Investment Company Act) for election by shareholders or appointment by the Board; (ii) advising the Board with respect to Board composition, procedures and Committees of the Board (other than the Audit Committee); (iii) overseeing periodic self-assessments of the Board and Committees of the Board (other than the Audit Committee); (iv) reviewing and making recommendations in respect to Independent Trustee compensation; (v) monitoring corporate governance matters and making recommendations in respect thereof to the Board; (vi) acting as the administrative committee with respect to Board policies and procedures, committee policies and procedures (other than the Audit Committee) and codes of ethics as they relate to the Independent Trustees; and (vii) reviewing and making recommendations to the Board in respect of Fund share ownership by the Independent Trustees. The Board has adopted a written charter for the Board’s Governance and Nominating Committee. During the fiscal year ended September 30, 2022, the Governance and Nominating Committee met six times.

The Governance and Nominating Committee of the Board seeks to identify individuals to serve on the Board who have a diverse range of viewpoints, qualifications, experiences, backgrounds and skill sets so that the Board will be better suited to fulfill its responsibility of overseeing the Funds’ activities. In so doing, the Governance and Nominating Committee reviews the size of the Board, the ages of the current Trustees and their tenure on the Board, and the skills, background and experiences of the Trustees in light of the issues facing the Funds in determining whether one or more new trustees should be added to the Board. The Board as a group strives to achieve diversity in terms of gender, race and geographic location. The Governance and Nominating Committee believes that the Trustees as a group possess the array of skills, experiences and backgrounds necessary to guide the Funds. The Trustees’ biographies included herein highlight the diversity and breadth of skills, qualifications and expertise that the Trustees bring to the Funds.

The Governance and Nominating Committee may consider nominations for Trustees made by the Funds’ shareholders as it deems appropriate. Under the Trust’s Bylaws, shareholders must follow certain procedures to nominate a person for election as a Trustee at a shareholder meeting at which Trustees are to be elected. Under these advance notice procedures, shareholders must submit the proposed nominee by delivering a notice to the Secretary of the Fund at its principal executive offices not later than the close of business on the 5^th day following the day on which notice of the date of the meeting was mailed or public disclosure of the date of the meeting was made, whichever first occurs.

The Trust’s Bylaws provide that notice of a proposed nomination must include certain information about the shareholder and the nominee, as well as certain other information, including a written consent of the proposed nominee to serve if elected. Reference is made to the Trust’s Bylaws for more details.

Compliance Committee. The Board has a Compliance Committee composed of Cynthia L. Egan (Chair), Stayce D. Harris, R. Glenn Hubbard and W. Carl Kester, all of whom are Independent Trustees. The Compliance Committee’s purpose is to assist the Board in fulfilling its responsibility with respect to the oversight of regulatory and fiduciary compliance matters involving the Trust, the fund-related activities of BlackRock, and any sub-advisers and the Trust’s other third party service providers. The Compliance Committee’s responsibilities include, without limitation: (i) overseeing the compliance policies and procedures of the Trust and its service providers and recommending changes or additions to such policies and procedures; (ii) reviewing information on and, where appropriate, recommending policies concerning the Trust’s compliance with applicable law; (iii) reviewing information on any significant correspondence with or other actions by regulators or governmental agencies with respect to the Trust’s and any employee complaints or published reports that raise concerns regarding compliance matters; and (iv) reviewing reports from, overseeing the annual performance review of, and making certain recommendations in respect of, the Trust’s CCO, including, without limitation, determining the amount and structure of the CCO’s compensation. The Board has adopted a written charter for the Board’s Compliance Committee. During the fiscal year ended September 30, 2022, the Compliance Committee met four times.

Performance Oversight Committee. The Board has a Performance Oversight Committee composed of Frank J. Fabozzi (Chair), Cynthia L. Egan, Lorenzo A. Flores, Stayce D. Harris, J. Phillip Holloman, R. Glenn Hubbard, W. Carl Kester and Catherine A. Lynch, all of whom are Independent Trustees. The Performance Oversight Committee’s purpose is to assist the Board in fulfilling its responsibility to oversee the Funds’ investment performance relative to the Funds’ investment objective, policies and practices. The Performance Oversight Committee’s responsibilities include, without limitation: (i) reviewing the Funds’ investment objective, policies and practices; (ii) recommending to the Board any required action in respect of changes in fundamental and non-fundamental investment restrictions; (iii) reviewing information on appropriate benchmarks and competitive universes; (iv) reviewing the Funds’ investment

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performance relative to such benchmarks; (v) reviewing information on unusual or exceptional investment matters; (vi) reviewing whether each Fund has complied with its investment policies and restrictions; and (vii) overseeing policies, procedures and controls regarding valuation of the Funds’ investments. The Board has adopted a written charter for the Board’s Performance Oversight Committee. During the fiscal year ended September 30, 2022, the Performance Oversight Committee met four times.

Executive Committee. The Board has an Executive Committee composed of R. Glenn Hubbard (Chair) and W. Carl Kester, both of whom are Independent Trustees, and John M. Perlowski, who serves as an interested Trustee. The principal responsibilities of the Executive Committee include, without limitation: (i) acting on routine matters between meetings of the Board; (ii) acting on such matters as may require urgent action between meetings of the Board; and (iii) exercising such other authority as may from time to time be delegated to the Executive Committee by the Board. The Board has adopted a written charter for the Board’s Executive Committee. During the fiscal year ended September 30, 2022, the Executive Committee did not meet.

The Independent Trustees have adopted a statement of policy that describes the experiences, qualifications, skills and attributes that are necessary and desirable for potential Independent Trustee candidates (the “Statement of Policy”). The Board believes that each Independent Trustee satisfied, at the time he or she was initially elected or appointed a Trustee, and continues to satisfy, the standards contemplated by the Statement of Policy as well as the standards set forth in the Trust’s Bylaws. Furthermore, in determining that a particular Trustee was and continues to be qualified to serve as a Trustee, the Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that, collectively, the Trustees have balanced and diverse experiences, skills, attributes and qualifications, which allow the Board to operate effectively in governing each Fund and protecting the interests of shareholders. Among the attributes common to all Trustees is their ability to review critically, evaluate, question and discuss information provided to them, to interact effectively with the Manager, sub-advisers, other service providers, counsel and independent auditors, and to exercise effective business judgment in the performance of their duties as Trustees. Each Trustee’s ability to perform his or her duties effectively is evidenced by his or her educational background or professional training; business, consulting, public service or academic positions; experience from service as a board member of the Trust or the other funds in the BlackRock Fund Complexes (and any predecessor funds), other investment funds, public companies, or not-for-profit entities or other organizations; ongoing commitment and participation in Board and Committee meetings, as well as his or her leadership of standing and other committees throughout the years; or other relevant life experiences.

The table below discusses some of the experiences, qualifications and skills of each Trustee that support the conclusion that he or she should serve on the Board.

Trustees		Experience, Qualifications and Skills
Independent Trustees
R. Glenn Hubbard		R. Glenn Hubbard has served in numerous roles in the field of economics, including as the Chairman of the U.S. Council of Economic Advisers of the President of the United States. Dr. Hubbard has served as the Dean of Columbia Business School, as a member of the Columbia Faculty and as a Visiting Professor at the John F. Kennedy School of Government at Harvard University, the Harvard Business School and the University of Chicago. Dr. Hubbard’s experience as an adviser to the President of the United States adds a dimension of balance to the Funds’ governance and provides perspective on economic issues. Dr. Hubbard’s service on the boards of ADP and Metropolitan Life Insurance Company provides the Board with the benefit of his experience with the management practices of other financial companies. Dr. Hubbard’s long-standing service on the boards of directors/trustees of the closed-end funds in the BlackRock Fixed-Income Complex also provides him with a specific understanding of the Funds, their operations, and the business and regulatory issues facing the Funds. Dr. Hubbard’s independence from the Funds and the Manager enhances his service as Chair of the Board, Chair of the Executive Committee and a member of the Governance and Nominating Committee, the Compliance Committee and the Performance Oversight Committee.

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Trustees		Experience, Qualifications and Skills
W. Carl Kester		The Board benefits from W. Carl Kester’s experiences as a professor and author in finance, and his experience as the George Fisher Baker Jr. Professor of Business Administration at Harvard Business School and as Deputy Dean of Academic Affairs at Harvard Business School from 2006 through 2010 adds to the Board a wealth of expertise in corporate finance and corporate governance. Dr. Kester has authored and edited numerous books and research papers on both subject matters, including co-editing a leading volume of finance case studies used worldwide. Dr. Kester’s long-standing service on the boards of directors/trustees of the closed-end funds in the BlackRock Fixed-Income Complex also provides him with a specific understanding of the Funds, their operations, and the business and regulatory issues facing the Funds. Dr. Kester’s independence from the Funds and the Manager enhances his service as Vice Chair of the Board, Chair of the Governance and Nominating Committee and a member of the Executive Committee, the Compliance Committee and the Performance Oversight Committee.
Cynthia L. Egan		Cynthia L. Egan brings to the Board a broad and diverse knowledge of investment companies and the retirement industry as a result of her many years of experience as President, Retirement Plan Services, for T. Rowe Price Group, Inc. and her various senior operating officer positions at Fidelity Investments, including her service as Executive Vice President of FMR Co., President of Fidelity Institutional Services Company and President of the Fidelity Charitable Gift Fund. Ms. Egan has also served as an advisor to the U.S. Department of Treasury as an expert in domestic retirement security. Ms. Egan began her professional career at the Board of Governors of the Federal Reserve and the Federal Reserve Bank of New York. Ms. Egan is also a director of UNUM Corporation, a publicly traded insurance company providing personal risk reinsurance, and of The Hanover Group, a public property casualty insurance company. Ms. Egan’s independence from the Funds and the Manager enhances her service as Chair of the Compliance Committee, and a member of the Governance and Nominating Committee and the Performance Oversight Committee.
Frank J. Fabozzi		Frank J. Fabozzi has served for over 25 years on the boards of registered investment companies. Dr. Fabozzi holds the designations of Chartered Financial Analyst and Certified Public Accountant. Dr. Fabozzi was inducted into the Fixed Income Analysts Society’s Hall of Fame and is the 2007 recipient of the C. Stewart Sheppard Award and the 2015 recipient of the James R. Vertin Award, both given by the CFA Institute. The Board benefits from Dr. Fabozzi’s experiences as a professor and author in the field of finance. Dr. Fabozzi’s experience as a professor at various institutions, including EDHEC Business School, Yale, MIT, and Princeton, as well as Dr. Fabozzi’s experience as a Professor in the Practice of Finance and Becton Fellow at the Yale University School of Management and as editor of the Journal of Portfolio Management demonstrates his wealth of expertise in the investment management and structured finance areas. Dr. Fabozzi has authored and edited numerous books and research papers on topics in investment management and financial econometrics, and his writings have focused on fixed income securities and portfolio management, many of which are considered standard references in the investment management industry. Dr. Fabozzi’s long-standing service on the boards of directors/trustees of the closed-end funds in the BlackRock Fixed-Income Complex also provides him with a specific understanding of the Funds, their operations and the business and regulatory issues facing the Funds. Moreover, Dr. Fabozzi’s knowledge of financial and accounting matters qualifies him to serve as a member of the Audit Committee. Dr. Fabozzi’s independence from the Funds and the Manager enhances his service as Chair of the Performance Oversight Committee.

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Trustees		Experience, Qualifications and Skills
Lorenzo A. Flores		The Board benefits from Lorenzo A. Flores’s many years of business, leadership and financial experience in his roles at various public and private companies. In particular, Mr. Flores’s service as Chief Financial Officer and Corporate Controller of Xilinx, Inc. and Vice Chairman of Kioxia, Inc. and his long experience in the technology industry allow him to provide insight to into financial, business and technology trends. Mr. Flores’s knowledge of financial and accounting matters qualifies him to serve as a member of the Audit Committee. Mr. Flores’s independence from the Funds and the Manager enhances his service as a member of the Performance Oversight Committee.
Stayce D. Harris		The Board benefits from Stayce D. Harris’s leadership and governance experience gained during her extensive military career, including as a three-star Lieutenant General of the United States Air Force. In her most recent role, Ms. Harris reported to the Secretary and Chief of Staff of the Air Force on matters concerning Air Force effectiveness, efficiency and the military discipline of active duty, Air Force Reserve and Air National Guard forces. Ms. Harris’s experience on governance matters includes oversight of inspection policy and the inspection and evaluation system for all Air Force nuclear and conventional forces; oversight of Air Force counterintelligence operations and service on the Air Force Intelligence Oversight Panel; investigation of fraud, waste and abuse; and oversight of criminal investigations and complaints resolution programs. Ms. Harris’s independence from the Funds and the Manager enhances her service as a member of the Compliance Committee and the Performance Oversight Committee.
J. Phillip Holloman		The Board benefits from J. Phillip Holloman’s many years of business and leadership experience as an executive, director and advisory board member of various public and private companies. In particular, Mr. Holloman’s service as President and Chief Operating Officer of Cintas Corporation and director of PulteGroup, Inc. and Rockwell Automation Inc. allows him to provide insight into business trends and conditions. Mr. Holloman’s knowledge of financial and accounting matters qualifies him to serve as a member of the Audit Committee. Mr. Holloman’s independence from the Funds and the Manager enhances his service as a member of the Governance and Nominating Committee and the Performance Oversight Committee.
Catherine A. Lynch		Catherine A. Lynch, who served as the Chief Executive Officer and Chief Investment Officer of the National Railroad Retirement Investment Trust, benefits the Board by providing business leadership and experience and a diverse knowledge of pensions and endowments. Ms. Lynch also holds the designation of Chartered Financial Analyst. Ms. Lynch’s knowledge of financial and accounting matters qualifies her to serve as Chair of the Audit Committee. Ms. Lynch’s independence from the Funds and the Manager enhances her service as a member of the Governance and Nominating Committee and the Performance Oversight Committee.
Interested Trustees
Robert Fairbairn		Robert Fairbairn has more than 25 years of experience with BlackRock, Inc. and over 30 years of experience in finance and asset management. In particular, Mr. Fairbairn’s positions as Vice Chairman of BlackRock, Inc., Member of BlackRock’s Global Executive and Global Operating Committees and Co-Chair of BlackRock’s Human Capital Committee provide the Board with a wealth of practical business knowledge and leadership. In addition, Mr. Fairbairn has global investment management and oversight experience through his former positions as Global Head of BlackRock’s Retail and iShares® businesses, Head of BlackRock’s Global Client Group, Chairman of BlackRock’s international businesses and his previous oversight over BlackRock’s Strategic Partner Program and Strategic Product Management Group. Mr. Fairbairn also serves as a board member for the funds in the BlackRock Multi-Asset Complex.

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Trustees		Experience, Qualifications and Skills
John M. Perlowski		John M. Perlowski’s experience as Managing Director of BlackRock, Inc. since 2009, as the Head of BlackRock Global Accounting and Product Services since 2009, and as President and Chief Executive Officer of the Funds provides him with a strong understanding of the Funds, their operations, and the business and regulatory issues facing the Funds. Mr. Perlowski’s prior position as Managing Director and Chief Operating Officer of the Global Product Group at Goldman Sachs Asset Management, and his former service as Treasurer and Senior Vice President of the Goldman Sachs Mutual Funds and as Director of the Goldman Sachs Offshore Funds provides the Board with the benefit of his experience with the management practices of other financial companies. Mr. Perlowski also serves as a board member for the funds in the BlackRock Multi-Asset Complex. Mr. Perlowski’s experience with BlackRock enhances his service as a member of the Executive Committee.

  

Biographical Information

Certain biographical and other information relating to the Trustees is set forth below, including their address and year of birth, principal occupations for at least the last five years, length of time served, total number of registered investment companies and investment portfolios overseen in the BlackRock-advised Funds and any currently held public company and other investment company directorships.

Name and Year of Birth1,2		Position(s) Held (Length of Service)3		Principal Occupation(s) During Past Five Years		Number of BlackRock- Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen		Public Company and Other Investment Company Directorships Held During Past Five Years
Independent Trustees
R. Glenn Hubbard 1958		Chair of the Board (Since 2022) and Trustee (Since 2019)		Dean, Columbia Business School from 2004 to 2019; Faculty member, Columbia Business School since 1988.		70 RICs consisting of 102 Portfolios		ADP (data and information services) from 2004 to 2020; Metropolitan Life Insurance Company (insurance); TotalEnergies SE (multi-energy)
W. Carl Kester4 1951		Vice Chair of the Board (Since 2022) and Trustee (Since 2019)		George Fisher Baker Jr. Professor of Business Administration, Harvard Business School since 2008; Deputy Dean for Academic Affairs from 2006 to 2010; Chairman of the Finance Unit, from 2005 to 2006; Senior Associate Dean and Chairman of the MBA Program from 1999 to 2005; Member of the faculty of Harvard Business School since 1981.		72 RICs consisting of 104 Portfolios		None
Cynthia L. Egan 1955		Trustee (Since 2019)		Advisor, U.S. Department of the Treasury from 2014 to 2015; President, Retirement Plan Services, for T. Rowe Price Group, Inc. from 2007 to 2012; executive positions within Fidelity Investments from 1989 to 2007.		70 RICs consisting of 102 Portfolios		Unum (insurance); The Hanover Insurance Group (Board Chair); Huntsman Corporation (Lead Independent Director and non-Executive Vice Chair of the Board) (chemical products)

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Name and Year of Birth1,2		Position(s) Held (Length of Service)3		Principal Occupation(s) During Past Five Years		Number of BlackRock- Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen		Public Company and Other Investment Company Directorships Held During Past Five Years
Frank J. Fabozzi4 1948		Trustee (Since 2019)		Editor of The Journal of Portfolio Management since 1986; Professor of Finance, EDHEC Business School (France) from 2011 to 2022; Professor of Practice, Johns Hopkins University since 2021; Professor in the Practice of Finance, Yale University School of Management from 1994 to 2011 and currently a Teaching Fellow in Yale’s Executive Programs; Visiting Professor, Rutgers University for the Spring 2019 semester; Visiting Professor, New York University for the 2019 academic year; Adjunct Professor of Finance, Carnegie Mellon University in fall 2020 semester.		72 RICs consisting of 104 Portfolios		None
Lorenzo A. Flores 1964		Trustee (Since 2021)		Vice Chairman, Kioxia, Inc. since 2019; Chief Financial Officer, Xilinx, Inc. from 2016 to 2019; Corporate Controller, Xilinx, Inc. from 2008 to 2016.		70 RICs consisting of 102 Portfolios		None
Stayce D. Harris 1959		Trustee (Since 2021)		Lieutenant General, Inspector General, Office of the Secretary of the United States Air Force from 2017 to 2019; Lieutenant General, Assistant Vice Chief of Staff and Director, Air Staff, United States Air Force from 2016 to 2017; Major General, Commander, 22nd Air Force, AFRC, Dobbins Air Reserve Base, Georgia from 2014 to 2016; Pilot, United Airlines from 1990 to 2020.		70 RICs consisting of 102 Portfolios		The Boeing Company (airplane manufacturer)
J. Phillip Holloman 1955		Trustee (Since 2021)		President and Chief Operating Officer, Cintas Corporation from 2008 to 2018.		70 RICs consisting of 102 Portfolios		PulteGroup, Inc. (home construction); Rockwell Automation Inc. (industrial automation)
Catherine A. Lynch4 1961		Trustee (Since 2019)		Chief Executive Officer, Chief Investment Officer and various other positions, National Railroad Retirement Investment Trust from 2003 to 2016; Associate Vice President for Treasury Management, The George Washington University from 1999 to 2003; Assistant Treasurer, Episcopal Church of America from 1995 to 1999.		72 RICs consisting of 104 Portfolios		PennyMac Mortgage Investment Trust
Interested Trustees5
Robert Fairbairn 1965		Trustee (Since 2015)		Vice Chairman of BlackRock, Inc. since 2019; Member of BlackRock’s Global Executive and Global Operating Committees; Co-Chair of BlackRock’s Human Capital Committee; Senior Managing Director of BlackRock, Inc. from 2010 to 2019; oversaw BlackRock’s Strategic Partner Program and Strategic Product Management Group from 2012 to 2019; Member of the Board of Managers of BlackRock Investments, LLC from 2011 to 2018; Global Head of BlackRock’s Retail and iShares® businesses from 2012 to 2016.		98 RICs consisting of 267 Portfolios		None

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Name and Year of Birth1,2		Position(s) Held (Length of Service)3		Principal Occupation(s) During Past Five Years		Number of BlackRock- Advised Registered Investment Companies (“RICs”) Consisting of Investment Portfolios (“Portfolios”) Overseen		Public Company and Other Investment Company Directorships Held During Past Five Years
John M. Perlowski4 1964		Trustee (Since 2015) President and Chief Executive Officer (Since 2010)		Managing Director of BlackRock, Inc. since 2009; Head of BlackRock Global Accounting and Product Services since 2009; Advisory Director of Family Resource Network (charitable foundation) since 2009.		100 RICs consisting of 269 Portfolios		None

  

1	The address of each Trustee is c/o BlackRock, Inc., 55 East 52nd Street, New York, New York 10055.
2	Each Independent Trustee holds office until his or her successor is duly elected and qualifies or until his or her earlier death, resignation, retirement or removal as provided by the Trust’s by-laws or charter or statute, or until December 31 of the year in which he or she turns 75. Trustees who are “interested persons,” as defined in the Investment Company Act, serve until their successor is duly elected and qualifies or until their earlier death, resignation, retirement or removal as provided by the Trust’s by-laws or statute, or until December 31 of the year in which they turn 72. The Board may determine to extend the terms of Independent Trustees on a case-by-case basis, as appropriate.
3	Length of service includes service as a trustee of the Predecessor Trust (as defined below), as applicable. Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. in September 2006, the various legacy MLIM and legacy BlackRock fund boards were realigned and consolidated into three new fund boards in 2007. Certain Independent Trustees first became members of the boards of other legacy MLIM or legacy BlackRock funds as follows: Frank J. Fabozzi, 1988; R. Glenn Hubbard, 2004 and W. Carl Kester, 1995. Certain other Independent Trustees became members of the boards of the closed-end funds in the BlackRock Fixed-Income Complex as follows: Cynthia L. Egan, 2016; and Catherine A. Lynch, 2016.
4	Dr. Fabozzi, Dr. Kester, Ms. Lynch and Mr. Perlowski are also trustees of the BlackRock Credit Strategies Fund and BlackRock Private Investments Fund.
5	Mr. Fairbairn and Mr. Perlowski are both “interested persons,” as defined in the Investment Company Act, of the Trust based on their positions with BlackRock, Inc. and its affiliates. Mr. Fairbairn and Mr. Perlowski are also board members of the BlackRock Multi-Asset Complex.

Certain biographical and other information relating to the officers of the Trust who are not Trustees is set forth below, including their address and year of birth, principal occupations for at least the last five years and length of time served.

Name and Year of Birth1,2		Position(s) Held (Length of Service)3		Principal Occupation(s) During Past Five Years
Officers Who Are Not Trustees
Jennifer McGovern 1977		Vice President (Since 2014)		Managing Director of BlackRock, Inc. since 2016; Director of BlackRock, Inc. from 2011 to 2015; Head of Americas Product Development and Governance for BlackRock’s Global Product Group since 2019; Head of Product Structure and Oversight for BlackRock’s U.S. Wealth Advisory Group from 2013 to 2019.
Trent Walker 1974		Chief Financial Officer (Since 2021)		Managing Director of BlackRock, Inc. since September 2019; Executive Vice President of PIMCO from 2016 to 2019; Senior Vice President of PIMCO from 2008 to 2015; Treasurer from 2013 to 2019 and Assistant Treasurer from 2007 to 2017 of PIMCO Funds, PIMCO Variable Insurance Trust, PIMCO ETF Trust, PIMCO Equity Series, PIMCO Equity Series VIT, PIMCO Managed Accounts Trust, 2 PIMCO-sponsored interval funds and 21 PIMCO-sponsored closed-end funds.
Jay M. Fife 1970		Treasurer (Since 2007)		Managing Director of BlackRock, Inc. since 2007.
Charles Park 1967		Chief Compliance Officer (Since 2014)		Anti-Money Laundering Compliance Officer for certain BlackRock-advised Funds from 2014 to 2015; Chief Compliance Officer of BlackRock Advisors, LLC and the BlackRock-advised Funds in the BlackRock Multi-Asset Complex and the BlackRock Fixed-Income Complex since 2014; Principal of and Chief Compliance Officer for iShares® Delaware Trust Sponsor LLC since 2012 and BlackRock Fund Advisors (“BFA”) since 2006; Chief Compliance Officer for the BFA-advised iShares® exchange traded funds since 2006; Chief Compliance Officer for BlackRock Asset Management International Inc. since 2012.
Lisa Belle 1968		Anti-Money Laundering Compliance Officer (Since 2019)		Managing Director of BlackRock, Inc. since 2019; Global Financial Crime Head for Asset and Wealth Management of JP Morgan from 2013 to 2019; Managing Director of RBS Securities from 2012 to 2013; Head of Financial Crimes for Barclays Wealth Americas from 2010 to 2012.

I-17

Name and Year of Birth1,2		Position(s) Held (Length of Service)3		Principal Occupation(s) During Past Five Years
Janey Ahn 1975		Secretary (Since 2019)		Managing Director of BlackRock, Inc. since 2018; Director of BlackRock, Inc. from 2009 to 2017.

  

1	The address of each Officer is c/o BlackRock, Inc., 55 East 52nd Street, New York, New York 10055.
2	Officers of the Trust serve at the pleasure of the Board.
3	Length of service includes service in such capacity for the Predecessor Trust.

Share Ownership

Information relating to each Trustee’s share ownership in the Funds and in all BlackRock-advised Funds that are currently overseen by the respective Trustee (“Supervised Funds”) as of December 31, 2022 is set forth in the chart below. Amounts shown may include shares as to which a Trustee has indirect beneficial ownership, such as through participation in certain family accounts, 529 college savings plan interests, or similar arrangements where the Trustee has beneficial economic interest but not a direct ownership interest.

Name of Trustee		Dollar Range of Equity Securities in the High Yield Bond Portfolio		Dollar Range of Equity Securities in the Low Duration Bond Portfolio		Dollar Range of Equity Securities in the Core Bond Portfolio		Aggregate Dollar Range of Equity Securities in Supervised Funds*
Independent Trustees:
Cynthia L. Egan		None		None		None		Over $100,000
Frank J. Fabozzi		None		None		None		Over $100,000
Lorenzo A. Flores		None		None		None		Over $100,000
Stayce D. Harris		None		None		None		Over $100,000
J. Phillip Holloman		None		None		None		Over $100,000
R. Glenn Hubbard		None		None		None		Over $100,000
W. Carl Kester		None		None		None		Over $100,000
Catherine A. Lynch		None		None		None		Over $100,000
Interested Trustees:
Robert Fairbairn		None		None		None		Over $100,000
John M. Perlowski		None		None		None		Over $100,000

  

*	Includes share equivalents owned under the deferred compensation plan in the Supervised Funds by certain Independent Trustees who have participated in the deferred compensation plan of the Supervised Funds.

As of January 4, 2023, the Trustees and officers of the Trust as a group directly or indirectly beneficially owned an aggregate of less than 1% of any class of the outstanding shares of each Fund. As of December 31, 2022, none of the Independent Trustees of the Trust or their immediate family members owned beneficially or of record any securities of each Fund’s investment adviser, principal underwriter, or any person directly or indirectly controlling, controlled by, or under common control with such entities.

Compensation of Trustees

Each Trustee who is an Independent Trustee is paid an annual retainer of $370,000 per year for his or her services as a Board member of the BlackRock-advised Funds, including the Funds, and each Independent Trustee may also receive a $10,000 Board meeting fee for special unscheduled meetings or meetings in excess of six Board meetings held in a calendar year, together with out-of-pocket expenses in accordance with a Board policy on travel and other business expenses relating to attendance at meetings. In addition, the Chair of the Board and the Vice Chair of the Board are paid an additional annual retainer of $100,000 and $60,000, respectively. The Chairs of the Audit Committee, Performance Oversight Committee, Compliance Committee, and Governance and Nominating Committee are paid an additional annual retainer of $45,000, $37,500, $45,000 and $37,500, respectively. Each of the members of the Audit Committee, Compliance Committee, and Governance and Nominating Committee are paid an additional annual retainer of $30,000, $25,000 and $25,000, respectively, for his or her service on such committee. The Funds will pay a pro rata portion quarterly (based on relative net assets) of the foregoing Trustee fees paid by the funds in the BlackRock Fixed-Income Complex.

The Independent Trustees have agreed that a maximum of 50% of each Independent Trustee’s total compensation paid by funds in the BlackRock Fixed-Income Complex may be deferred pursuant to the BlackRock Fixed-Income Complex’s deferred compensation plan. Under the deferred compensation plan, deferred amounts earn a return for the Independent Trustees as though equivalent dollar amounts had been invested in shares of certain funds in the BlackRock Fixed-Income Complex selected by the Independent Trustees. This has approximately the same economic effect for the Independent Trustees as if they had invested the deferred amounts in such funds in the BlackRock Fixed-Income Complex. The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of a fund and are recorded as a liability for accounting purposes.

I-18

The following table sets forth the compensation paid to the Trustees by the Trust, on behalf of the Funds, for the fiscal year ended September 30, 2022, and the aggregate compensation, including deferred compensation amounts, paid to them by all BlackRock-advised Funds for the calendar year ended December 31, 2022.

Name1		Aggregate Compensation from the High Yield Bond Fund		Aggregate Compensation from the Low Duration Bond Fund		Aggregate Compensation from the Core Bond Fund		Estimated Annual Benefits Upon Retirement		Aggregate Compensation from the Funds and Other BlackRock- Advised Funds2,3
Independent Trustees:
Michael J. Castellano4		$6,591		$2,478		$1,239		None		N/A
Richard E. Cavanagh5		$7,350		$2,761		$1,379		None		N/A
Cynthia L. Egan		$25,311		$9,833		$4,841		None		$465,000
Frank J. Fabozzi		$24,148		$9,379		$4,624		None		$497,500
Lorenzo A. Flores		$22,012		$8,558		$4,227		None		$400,000
Stayce D. Harris		$21,987		$8,546		$4,222		None		$395,000
J. Phillip Holloman6		$22,846		$8,877		$4,380		None		$415,453
R. Glenn Hubbard		$27,494		$10,683		$5,249		None		$520,000
W. Carl Kester		$26,766		$10,416		$5,115		None		$587,500
Catherine A. Lynch7		$24,413		$9,491		$4,673		None		$520,453
Karen P. Robards8		$18,744		$7,239		$3,594		None		$212,500
Interested Trustees:
Robert Fairbairn		None		None		None		None		None
John M. Perlowski		None		None		None		None		None

  

1	For the number of BlackRock-advised Funds from which each Trustee receives compensation see the Biographical Information Chart beginning on page I-15.
2	For the Independent Trustees, this amount represents the aggregate compensation earned from the funds in the BlackRock Fixed-Income Complex during the calendar year ended December 31, 2022. Of this amount, Dr. Fabozzi, Mr. Flores, Ms. Harris, Mr. Holloman, Dr. Hubbard, Dr. Kester and Ms. Lynch deferred $74,625, $200,000, $197,500, $207,726, $260,000, $88,125 and $78,067, respectively, pursuant to the BlackRock Fixed-Income Complex’s deferred compensation plan.
3	Total amount of deferred compensation payable by the BlackRock Fixed-Income Complex to Dr. Fabozzi, Mr. Flores, Ms. Harris, Mr. Holloman, Dr. Hubbard, Dr. Kester and Ms. Lynch is $1,172,873, $239,580, $238,473, $249,920, $3,546,573, $1,645,645 and $425,559, respectively, as of December 31, 2022. Ms. Egan did not participate in the deferred compensation plan as of December 31, 2022.
4	Mr. Castellano retired as a Trustee of the Trust and Chair of the Audit Committee effective December 31, 2021.
5	Mr. Cavanagh retired as a Trustee of the Trust and Co-Chair of the Board effective December 31, 2021.
6	Mr. Holloman was appointed as a member of the Governance and Nominating Committee effective May 20, 2022.
7	Ms. Lynch was appointed as a member of the Governance and Nominating Committee effective May 20, 2022.
8	Ms. Robards retired and resigned as a Trustee of the Trust effective May 31, 2022.

IV. Management, Advisory and Other Service Arrangements

The Trust, on behalf of each Fund, has entered into an investment advisory agreement with the Manager (the “Management Agreement”), pursuant to which the Manager receives as compensation for its services to each Fund, a fee with respect to each Fund at the end of each month at the rates described below.

MAXIMUM ANNUAL CONTRACTUAL FEE RATE FOR
THE FUNDS (BEFORE WAIVERS)

High Yield Bond Portfolio

The maximum annual management fees payable to BlackRock (as a percentage of average daily net assets) for the High Yield Bond Portfolio are calculated as follows:

		Rate of Management Fee
Average Daily Net Assets		High Yield Bond Portfolio
First $1 billion		0.500%
$1 billion – $2 billion		0.450%
$2 billion – $3 billion		0.425%
$3 billion – $25 billion		0.400%
$25 billion – $30 billion		0.375%
Greater than $30 billion		0.350%

  

Low Duration Bond Portfolio

The maximum annual management fees payable to BlackRock (as a percentage of average daily net assets) for the Low Duration Bond Portfolio are calculated as follows:

		Rate of Management Fee
Average Daily Net Assets		Low Duration Bond Portfolio
First $1 billion		0.310%

I-19

		Rate of Management Fee
Average Daily Net Assets		Low Duration Bond Portfolio
$1 billion – $3 billion		0.290%
$3 billion – $5 billion		0.280%
$5 billion – $10 billion		0.270%
Greater than $10 billion		0.260%

  

Core Bond Portfolio

The maximum annual management fees payable to BlackRock (as a percentage of average daily net assets) for the Core Bond Portfolio are calculated as follows:

		Rate of Management Fee
Average Daily Net Assets		Core Bond Portfolio
First $1 billion		0.350%
$1 billion – $2 billion		0.340%
$2 billion – $3 billion		0.330%
Greater than $3 billion		0.320%

  

BlackRock has contractually agreed to waive the management fee payable by each Fund with respect to any portion of such Fund’s assets estimated to be attributable to investments in other equity and fixed-income mutual funds and exchange-traded funds managed by BlackRock or its affiliates that have a contractual management fee, through June 30, 2024. Effective January 28, 2020, BlackRock has contractually agreed to waive its management fees by the amount of investment advisory fees each Fund pays to BlackRock indirectly through its investment in money market funds managed by BlackRock or its affiliates through June 30, 2024. Prior to January 28, 2020, such agreement to waive a portion of each Fund’s management fee in connection with each Fund’s investment in affiliated money market funds was voluntary. The contractual agreements may be terminated upon 90 days’ notice by a majority of the Independent Trustees or by a vote of a majority of the outstanding voting securities of the Fund.

The Manager has contractually agreed to waive and/or reimburse fees or expenses of each Fund in order to limit Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and expenses and certain other Fund expenses (as defined in the Fund’s Prospectuses)) as a percentage of average daily net assets to the amounts noted in the table below through June 30, 2024. The contractual agreement may be terminated upon 90 days’ notice by a majority of the Independent Trustees or by a vote of a majority of the outstanding voting securities of a Fund.

	Contractual Caps on Total Annual Fund Operating Expenses (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses)
High Yield Bond Portfolio
Investor A Shares	0.92%
Investor C Shares	1.72%
Institutional Shares	0.67%
Class R Shares	1.28%
Class K Shares	0.58%
Service Shares	1.02%
Low Duration Bond Portfolio
Investor A Shares	0.65%
Investor C Shares	1.40%
Institutional Shares	0.40%
Class R Shares	0.90%
Class K Shares	0.35%
Investor A1 Shares	0.50%

I-20

	Contractual Caps on Total Annual Fund Operating Expenses (excluding Dividend Expense, Interest Expense, Acquired Fund Fees and Expenses and certain other Fund expenses)
Core Bond Portfolio
Investor A Shares	0.68%
Investor C Shares	1.43%
Institutional Shares	0.43%
Class R Shares	0.93%
Class K Shares	0.38%

  

Pursuant to the Management Agreement, the Manager may from time to time, in its sole discretion to the extent permitted by applicable law, appoint one or more sub-advisers, including, without limitation, affiliates of the Manager, to perform investment advisory services with respect to the Funds. In addition, the Manager may delegate certain of its investment advisory functions under the Management Agreement to one or more of its affiliates to the extent permitted by applicable law. The Manager may terminate any or all sub-advisers or such delegation arrangements in its sole discretion at any time to the extent permitted by applicable law.

The Manager entered into a separate sub-advisory agreement with BlackRock International Limited (“BIL”) with respect to each of the High Yield Bond Portfolio, the Low Duration Bond Portfolio and the Core Bond Portfolio pursuant to which BIL receives for the services it provides for that portion of the High Yield Bond Portfolio, the Low Duration Bond Portfolio and the Core Bond Portfolio for which it serves as sub-adviser a monthly fee at an annual rate equal to a percentage of the management fee paid to the Manager under the Management Agreement with respect to the High Yield Bond Portfolio, the Low Duration Bond Portfolio or the Core Bond Portfolio, as applicable.

The Manager entered into a sub-advisory agreement with BlackRock (Singapore) Limited (“BSL” and together with BIL, the “Sub-Advisers”) with respect to each of the Low Duration Bond Portfolio and the Core Bond Portfolio pursuant to which BSL receives for the services it provides for that portion of the Low Duration Bond Portfolio and the Core Bond Portfolio for which it serves as sub-adviser a monthly fee at an annual rate equal to a percentage of the management fee paid to the Manager under the Management Agreement with respect to the Low Duration Bond Portfolio and the Core Bond Portfolio, as applicable.

For the fiscal year ended September 30, 2022, the Funds paid BlackRock management fees (which includes amounts paid by the Manager to the Sub-Advisers), and BlackRock waived management fees and reimbursed expenses, as follows:

Funds		Paid to the Manager		Waived by the Manager		Reimbursed by the Manager
High Yield Bond Portfolio		$85,809,618		$1,017,090		$267
Low Duration Bond Portfolio		$22,219,373		$202,923		$1,034,828
Core Bond Portfolio		$12,898,007		$653,305		$2,059,648

  

For the fiscal year ended September 30, 2021, the Funds paid BlackRock management fees (which includes amounts paid by the Manager to the Sub-Advisers), and BlackRock waived management fees and reimbursed expenses, as follows:

Funds		Paid to the Manager		Waived by the Manager		Reimbursed by the Manager
High Yield Bond Portfolio		$103,721,898		$2,096,278		$0
Low Duration Bond Portfolio		$23,325,387		$517,522		$1,204,824
Core Bond Portfolio		$15,256,799		$625,405		$2,157,071

  

For the fiscal year ended September 30, 2020, the Funds paid BlackRock management fees (which includes amounts paid by the Manager to the Sub-Advisers), and BlackRock waived management fees and reimbursed expenses, as follows:

Funds		Paid to the Manager		Waived by the Manager		Reimbursed by the Manager
High Yield Bond Portfolio		$81,517,591		$2,144,445		$0
Low Duration Bond Portfolio		$20,541,485		$575,944		$1,758,378
Core Bond Portfolio		$12,793,238		$748,779		$2,185,341

  

Administration Agreement. BlackRock serves as the Funds’ administrator pursuant to an administration agreement (the “Administration Agreement”). BlackRock has agreed to maintain office facilities for each Fund; furnish each Fund with clerical, bookkeeping and administrative services; oversee the determination and publication

I-21

of each Fund’s net asset value; oversee the preparation and filing of Federal, state and local income tax returns; prepare certain reports required by regulatory authorities; calculate various contractual expenses; determine the amount of dividends and distributions available for payment by each Fund to its shareholders; prepare and arrange for the printing of dividend notices to shareholders; provide Fund service providers with such information as is required to effect the payment of dividends and distributions; and serve as liaison with the Trust’s officers, independent accountants, legal counsel, custodian, accounting agent and transfer and dividend disbursing agent in establishing the accounting policies of each Fund and monitoring financial and shareholder accounting services. BlackRock may from time to time voluntarily waive administration fees with respect to each Fund and may voluntarily reimburse the Fund for expenses.

Under the Administration Agreement with BlackRock, the Trust, on behalf of each Fund, pays to BlackRock a fee, computed daily and payable monthly, at an aggregate annual rate of (i) 0.0425% of the first $500 million of the Fund’s average daily net assets, 0.040% of the next $500 million of the Fund’s average daily net assets, 0.0375% of the next $1 billion of the Fund’s average daily net assets, 0.035% of the next $2 billion of the Fund’s average daily net assets, 0.0325% of the next $9 billion of the Fund’s average daily net assets and 0.030% of the average daily net assets of the Fund in excess of $13 billion and (ii) 0.020% of average daily net assets allocated to each class of shares of the Fund.

For the fiscal year ended September 30, 2022, the Trust, on behalf of each Fund, paid BlackRock administration fees, and BlackRock waived administration fees, as follows:

Funds		Fees Paid to BlackRock		Fees Waived by BlackRock
High Yield Bond Portfolio		$11,019,685		$76,727
Low Duration Bond Portfolio		$4,313,395		$1,451,196
Core Bond Portfolio		$2,199,127		$768,587

  

For the fiscal year ended September 30, 2021, the Trust, on behalf of each Fund, paid BlackRock administration fees, and BlackRock waived administration fees, as follows:

Funds		Fees Paid to BlackRock		Fees Waived by BlackRock
High Yield Bond Portfolio		$13,290,895		$0
Low Duration Bond Portfolio		$4,528,389		$1,532,070
Core Bond Portfolio		$2,592,058		$914,284

  

For the fiscal year ended September 30, 2020, the Trust, on behalf of each Fund, paid BlackRock administration fees, and BlackRock waived administration fees, as follows:

Funds		Fees Paid to BlackRock		Fees Waived by BlackRock
High Yield Bond Portfolio		$10,486,242		$166
Low Duration Bond Portfolio		$3,987,174		$1,401,549
Core Bond Portfolio		$2,181,915		$761,092

  

The Trust and its service providers may engage third party plan administrators who provide trustee, administrative and recordkeeping services for certain employee benefit, profit-sharing and retirement plans as agents for the Trust with respect to such plans, for the purpose of accepting orders for the purchase and redemption of shares of the Funds.

In addition, pursuant to a Shareholders’ Administrative Services Agreement, BlackRock provides certain shareholder liaison services in connection with the Trust’s investor service center. The Trust, on behalf of the Funds, reimburses BlackRock for its costs in maintaining the service center, which costs include, among other things, employee salaries, leasehold expenses, and other out-of-pocket expenses.

The following table sets forth the fees paid by the Trust, on behalf of each Fund, to the Manager pursuant to the Shareholders’ Administrative Services Agreement for the periods indicated:

		High Yield Bond Portfolio				Low Duration Bond Portfolio				Core Bond Portfolio
Fiscal Year Ended September 30,		Fees Paid to the Manager		Fees Waived by the Manager		Fees Paid to the Manager		Fees Waived by the Manager		Fees Paid to the Manager		Fees Waived by the Manager
2022		$151,016		$5,243		$29,051		$21,169		$22,837		$22,808
2021		$55,527		$0		$18,105		$16,628		$13,488		$13,477
2020		$53,047		$0		$17,147		$16,265		$10,629		$10,617

  

I-22

Information Regarding the Portfolio Managers

James Keenan, CFA, Mitchell S. Garfin, CFA, David Delbos, Derek Schoenhofen, Scott MacLellan, CFA, CMT, Rick Rieder, Bob Miller, Akiva Dickstein, David Rogal, Adam Carlin, CFA, Amanda Liu, CFA, Sam Summers and Chi Chen are the Funds’ portfolio managers, as noted below. On or about March 31, 2023, Bob Miller will retire from BlackRock, Inc., and will no longer serve as a portfolio manager of the Low Duration Bond Portfolio and the Core Bond Portfolio.

Other Funds and Accounts Managed

Set forth below is information regarding other funds and accounts other than the Funds managed by the portfolio managers as of September 30, 2022.

High Yield Bond Portfolio

	Number of Other Accounts Managed and Assets by Account Type			Number of Other Accounts and Assets for Which Advisory Fee is Performance-Based
Name of Portfolio Manager	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts
David Delbos	28	26	102	0	0	5
	$16.23 Billion	$11.46 Billion	$16.32 Billion	$0	$0	$877.92 Million
Mitchell Garfin, CFA	26	29	107	0	0	5
	$17.67 Billion	$11.57 Billion	$15.90 Billion	$0	$0	$877.92 Million
James Keenan, CFA	24	32	18	0	0	5
	$16.48 Billion	$11.80 Billion	$7.74 Billion	$0	$0	$862.29 Million
Derek Schoenhofen	8	13	1	0	0	0
	$4.51 Billion	$9.11 Billion	$621.15 Thousand	$0	$0	$0

  

Low Duration Bond Portfolio

	Number of Other Accounts Managed and Assets by Account Type			Number of Other Accounts and Assets for Which Advisory Fee is Performance-Based
Name of Portfolio Manager	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts
Adam Carlin, CFA	7	3	104	0	0	1
	$6.79 Billion	$2.76 Billion	$39.72 Billion	$0	$0	$101.51 Million
Akiva Dickstein	22	25	224	0	0	5
	$18.55 Billion	$7.80 Billion	$95.88 Billion	$0	$0	$1.63 Billion
Amanda Liu, CFA	7	3	114	0	0	1
	$6.79 Billion	$2.76 Billion	$40.65 Billion	$0	$0	$101.51 Million
Scott MacLellan, CFA, CMT	12	15	137	0	0	3
	$7.40 Billion	$3.49 Billion	$57.14 Billion	$0	$0	$1.05 Billion
Bob Miller*	18	18	15	0	0	7
	$73.93 Billion	$21.64 Billion	$5.05 Billion	$0	$0	$3.30 Billion
Sam Summers	12	14	4	0	0	0
	$80.19 Billion	$21.06 Billion	$2.02 Billion	$0	$0	$0

  

Core Bond Portfolio

	Number of Other Accounts Managed and Assets by Account Type			Number of Other Accounts and Assets for Which Advisory Fee is Performance-Based
Name of Portfolio Manager	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts	Other Registered Investment Companies	Other Pooled Investment Vehicles	Other Accounts
Chi Chen	9	5	1	0	0	0
	$33.47 Billion	$9.21 Billion	$53.99 Million	$0	$0	$0
Akiva Dickstein	22	24	224	0	0	5
	$21.94 Billion	$7.71 Billion	$95.88 Billion	$0	$0	$1.63 Billion
Bob Miller*	18	18	15	0	0	7
	$77.31 Billion	$21.64 Billion	$5.05 Billion	$0	$0	$3.30 Billion
Rick Rieder	23	35	18	0	7	3
	$100.85 Billion	$37.34 Billion	$2.96 Billion	$0	$1.05 Billion	$259.67 Million
David Rogal	17	13	20	0	0	0
	$76.22 Billion	$18.59 Billion	$11.24 Billion	$0	$0	$0

  

*	On or about March 31, 2023, Bob Miller will retire from BlackRock, Inc., and will no longer serve as a portfolio manager of the Low Duration Bond Portfolio and the Core Bond Portfolio.

I-23

Portfolio Manager Compensation Overview

The discussion below describes the portfolio managers’ compensation as of September 30, 2022.

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

Base Compensation. Generally, portfolio managers receive base compensation based on their position with the firm.

Discretionary Incentive Compensation

Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these portfolios and BlackRock. In most cases, these benchmarks are the same as the benchmark or benchmarks against which the performance of the Fund or other accounts managed by the portfolio managers are measured. Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio manager’s compensation based on the performance of the Fund and other accounts managed by each portfolio manager relative to the various benchmarks. Performance of fixed-income funds is measured on a pre-tax and/or after-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. With respect to these portfolio managers, such benchmarks for the Funds and other accounts are:

Portfolio Manager		Applicable Benchmarks
James Keenan, CFA Mitchell Garfin, CFA David Delbos Derek Schoenhofen		A combination of market-based indices (e.g., The Bloomberg U.S. Corporate High Yield 2% Issuer Cap Index), certain customized indices and certain fund industry peer groups.
Scott MacLellan, CFA, CMT		A combination of market-based indices (e.g., Bank of America Merrill Lynch U.S. Corporate & Government Index, 1-3 Years), certain customized indices and certain fund industry peer groups.
Rick Rieder Bob Miller* David Rogal Adam Carlin, CFA Chi Chen Amanda Liu, CFA Sam Summers		A combination of market-based indices (e.g., Bloomberg U.S. Aggregate Bond Index), certain customized indices and certain fund industry peer groups.
Akiva Dickstein		A combination of market-based indices (e.g., Bloomberg U.S. Aggregate Index, Bloomberg U.S. Universal Index and Bloomberg Intermediate Aggregate Index), certain customized indices and certain fund industry peer groups.

  

*	On or about March 31, 2023, Bob Miller will retire from BlackRock, Inc., and will no longer serve as a portfolio manager of the Low Duration Bond Portfolio and the Core Bond Portfolio.

Distribution of Discretionary Incentive Compensation. Discretionary incentive compensation is distributed to portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards that notionally track the return of certain BlackRock investment products.

Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The portfolio managers of these Funds have deferred BlackRock, Inc. stock awards.

For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,

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which provides direct alignment of portfolio manager discretionary incentive compensation with investment product results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only portfolio managers who manage specified products and whose total compensation is above a specified threshold are eligible to participate in the deferred cash award program.

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

Incentive Savings Plans — BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit ($305,000 for 2022). The RSP offers a range of investment options, including registered investment companies and collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by participants for their own contributions or, absent participant investment direction, are invested into a target date fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of $25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to participate in these plans.

Portfolio Manager Beneficial Holdings

As of September 30, 2022, the end of each Fund’s most recently completed fiscal year end, the dollar range of securities beneficially owned by each portfolio manager in the Funds is shown below:

Portfolio Manager		Fund(s) Managed		Dollar Range of Equity Securities Beneficially Owned
Chi Chen		Core Bond Portfolio		None
Akiva Dickstein		Core Bond Portfolio		$100,001-$500,000
		Low Duration Bond Portfolio		$50,001-$100,000
Bob Miller*		Core Bond Portfolio		$100,001-$500,000
		Low Duration Bond Portfolio		$100,001-$500,000
Rick Rieder		Core Bond Portfolio		None
David Rogal		Core Bond Portfolio		$10,001-$50,000
David Delbos		High Yield Bond Portfolio		$500,001-$1,000,000
Mitchell Garfin, CFA		High Yield Bond Portfolio		$100,001-$500,000
James Keenan, CFA		High Yield Bond Portfolio		$100,001-$500,000
Derek Schoenhofen		High Yield Bond Portfolio		None
Adam Carlin, CFA		Low Duration Bond Portfolio		None
Amanda Liu, CFA		Low Duration Bond Portfolio		None
Scott MacLellan, CFA, CMT		Low Duration Bond Portfolio		$50,001-$100,000
Sam Summers		Low Duration Bond Portfolio		None

  

*	On or about March 31, 2023, Bob Miller will retire from BlackRock, Inc., and will no longer serve as a portfolio manager of the Low Duration Bond Portfolio and the Core Bond Portfolio.

Portfolio Manager Potential Material Conflicts of Interest

BlackRock has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Funds, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Funds. In addition, BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Funds. BlackRock, or any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their families may take different actions than those recommended to the Funds by BlackRock with respect to the same securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock or any of its affiliates or significant shareholders or the

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officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information. Certain portfolio managers also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a Fund. It should also be noted that Messrs. Carlin, Delbos, Dickstein, Garfin, Keenan, MacLellan, Miller, Rieder, Rogal, Schoenhofen and Summers and Mses. Chen and Liu may be managing hedge fund and/or long only accounts, or may be part of a team managing hedge fund and/or long only accounts, subject to incentive fees. Messrs. Carlin, Delbos, Dickstein, Garfin, Keenan, MacLellan, Miller, Rieder, Rogal, Schoenhofen and Summers and Mses. Chen and Liu may therefore be entitled to receive a portion of any incentive fees earned on such accounts.

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

Custodian and Transfer Agency Agreements

JPMorgan Chase Bank, N.A. (“JPM”), which has its principal offices at 383 Madison Avenue, New York, New York 10179, serves as the custodian for the Funds. Among other responsibilities, JPM maintains a custody account or accounts in the name of the Funds, receives and delivers all assets for the Funds upon purchase and upon sale or maturity, and collects and receives all income and other payments and distributions on account of the assets of the Funds.

BNY Mellon Investment Servicing (US) Inc., which has its principal place of business at 301 Bellevue Parkway, Wilmington, Delaware 19809, serves as the transfer and dividend disbursement agent for each Fund.

Accounting Services

JPM serves as the accounting services provider for the Funds. JPM records investment, capital share and income and expense activities; verifies and transmits trade tickets; maintains accounting ledgers for investment securities; maintains tax lots; reconciles cash with the Funds custodian; reports cash balances to BlackRock; prepares certain financial statements; calculates expenses, gains, losses and income; controls disbursements; works with independent pricing sources; and computes and reports net asset value. In connection with its accounting services, JPM also provides certain administration services to the Fund.

The table below shows the amount paid by the Trust, on behalf of each Fund, to JPM for accounting services for the periods indicated:

		Fees Paid to JPM
Fiscal Year Ended September 30,		High Yield Bond Portfolio		Low Duration Bond Portfolio		Core Bond Portfolio
2022		$1,169,715		$513,667		$260,372
2021		$1,443,052		$510,132		$303,310
2020		$1,079,190		$437,894		$261,399

  

Credit Agreement

The Trust, on behalf of the Funds, along with certain other funds managed by the Manager and its affiliates (“Participating Funds”), is a party to a 364-day, $2.5 billion credit agreement with a group of lenders, which facility terminates on April 13, 2023, unless otherwise extended or renewed (the “Credit Agreement”). Excluding commitments designated for certain Participating Funds, the Participating Funds, including the Funds, can borrow up to an aggregate commitment amount of $1.75 billion at any time outstanding, subject to asset coverage and other limitations as specified in the Credit Agreement. The Funds may borrow under the Credit Agreement to meet shareholder redemptions and for other lawful purposes. However, each Fund may not borrow under the Credit Agreement for leverage. Each Fund may borrow up to the maximum amount allowable under its current Prospectuses and SAI, subject to various other legal, regulatory or contractual limits. Borrowing results in interest expense and other fees and expenses for a Fund which may impact the Fund’s net expenses. The costs of borrowing may reduce a Fund’s return. Each Fund is charged its pro rata share of upfront fees and commitment fees on the aggregate commitment amount based on its net assets. If a Fund borrows pursuant to the Credit Agreement, the Fund will be charged interest at a variable rate.

V. Information on Sales Charges and Distribution Related Expenses

Distribution Agreement and Distribution and Service Plan. The Trust has entered into a distribution agreement with BlackRock Investments, LLC (“BRIL,” or the “Distributor”) under which BRIL, as agent, offers shares of the Funds on a continuous basis. BRIL has agreed to use appropriate efforts to effect sales of the shares, but it is not

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obligated to sell any particular amount of shares. BRIL’s principal business address is 40 East 52nd Street, New York, New York 10022. BRIL is an affiliate of BlackRock.

The Trust may also pay shareholder servicing fees (also referred to as general shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their affiliates) (collectively, “Service Organizations”) for certain support services rendered by Service Organizations to their customers who are the beneficial owners of Service, Investor A, Investor A1, Investor C and Class R Shares of the Funds.

Set forth below is information on sales charges (including any contingent deferred sales charges (“CDSCs”)) received by the Funds, including the amounts paid to affiliates of BlackRock, for the period indicated.

High Yield Bond Portfolio

Investor A Sales Charges Information

		Investor A Shares
For the Fiscal Year Ended September 30,		Gross Sales Charges Collected		Sales Charges Retained by BRIL		Sales Charges Paid to Affiliates		CDSCs Received on Redemption of Load-Waived Shares
2022		$502,480		$39,703		$39,703		$59,530
2021		$1,235,413		$101,624		$101,624		$37,989
2020		$1,177,854		$93,824		$93,824		$4,987

  

Investor C Sales Charges Information

		Investor C Shares
For the Fiscal Year Ended September 30,		CDSCs Received by BRIL		CDSCs Paid to Affiliates
2022		$19,375		$19,375
2021		$38,201		$38,201
2020		$36,412		$36,412

  

Low Duration Bond Portfolio

Investor A Sales Charges Information

		Investor A Shares
For the Fiscal Year Ended September 30,		Gross Sales Charges Collected		Sales Charges Retained by BRIL		Sales Charges Paid to Affiliates		CDSCs Received on Redemption of Load-Waived Shares
2022		$314,442		$43,112		$43,112		$196,098
2021		$730,561		$96,738		$96,738		$42,739
2020		$643,074		$91,299		$91,299		$83,767

  

Investor C Sales Charges Information

		Investor C Shares
For the Fiscal Year Ended September 30,		CDSCs Received by BRIL		CDSCs Paid to Affiliates
2022		$19,645		$19,645
2021		$14,826		$14,826
2020		$13,888		$13,888

  

Core Bond Portfolio

Investor A Sales Charges Information

		Investor A Shares
For the Fiscal Year Ended September 30,		Gross Sales Charges Collected		Sales Charges Retained by BRIL		Sales Charges Paid to Affiliates		CDSCs Received on Redemption of Load- Waived Shares
2022		$192,187		$15,494		$15,494		$24,682
2021		$529,240		$44,394		$44,394		$20,497
2020		$784,188		$66,380		$66,380		$15,584

  

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Investor C Sales Charges Information

		Investor C Shares
For the Fiscal Year Ended September 30,		CDSCs Received by BRIL		CDSCs Paid to Affiliates
2022		$1,297		$1,297
2021		$6,021		$6,021
2020		$8,184		$8,184

  

The tables below provide information for the fiscal year ended September 30, 2022 about the 12b-1 fees each Fund paid to BRIL under the Trust’s 12b-1 plans. A significant amount of the fees collected by BRIL were paid to affiliates, for providing shareholder servicing activities for Investor A, Investor A1 and Service Shares and for providing shareholder servicing and distribution-related activities and services for Investor C and Class R Shares.

High Yield Bond Portfolio

Class Name		Paid to BRIL
Investor A Shares		$3,190,836
Investor C Shares		$1,293,228
Class R Shares		$505,280
Service Shares		$277,460

  

Low Duration Bond Portfolio

Class Name		Paid to BRIL
Investor A Shares		$2,758,239
Investor A1 Shares		$5,917
Investor C Shares		$436,751
Class R Shares		$11,516

  

Core Bond Portfolio

Class Name		Paid to BRIL
Investor A Shares		$1,043,170
Investor C Shares		$196,685
Class R Shares		$6,250

  

VI. Computation of Offering Price Per Share

An illustration of the computation of the public offering price of the Investor A Shares of each Fund, based on the value of the Fund’s Investor A Shares’ net assets and number of Investor A Shares outstanding as of September 30, 2022 follows:

	High Yield Bond Portfolio Investor A Shares		Low Duration Bond Portfolio Investor A Shares		Core Bond Portfolio Investor A Shares
Net Assets	$1,088,099,503		$916,865,192		$358,178,814
Number of Shares Outstanding	168,082,368		102,977,106		44,062,107
Net Asset Value Per Share (net assets divided by number of shares outstanding)	$6.47		$8.90		$8.13
Sales Charge (for Investor A Shares: 4.00% of offering price for High Yield Bond Portfolio and Core Bond Portfolio and 2.25% for Low Duration Bond Portfolio)1	$0.27		$0.20		$0.34
Offering Price	$6.74		$9.10		$8.47

  

1	Assumes maximum sales charge applicable. The maximum sales charge as a percentage of net asset value per share was 4.17% for High Yield Bond Portfolio and Core Bond Portfolio and 2.30% for Low Duration Bond Portfolio.

The offering price for the Funds’ other share classes is equal to the share class’ net asset value computed as set forth above for Investor A Shares. Though not subject to a sales charge, certain share classes may be subject to a CDSC on redemption. For more information on the purchasing and valuation of shares, please see “Purchase of Shares” and “Pricing of Shares” in Part II of this SAI.

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VII. Portfolio Transactions and Brokerage

See “Portfolio Transactions and Brokerage” in Part II of this SAI for more information.

Information about the brokerage commissions paid by the Funds, including commissions paid to affiliates, for the last three fiscal years is set forth in the following table:

		High Yield Bond Portfolio				Low Duration Bond Portfolio				Core Bond Portfolio
Fiscal Year Ended September 30,		Aggregate Brokerage Commissions Paid		Commissions Paid to Affiliates		Aggregate Brokerage Commissions Paid		Commissions Paid to Affiliates		Aggregate Brokerage Commissions Paid		Commissions Paid to Affiliates
2022		$2,328,927		$0		$648,711		$0		$490,955		$0
2021		$3,098,404		$0		$637,563		$0		$638,910		$0
2020		$5,203,402		$0		$637,632		$0		$466,738		$0

  

For the fiscal year ended September 30, 2022, the brokerage commissions paid to affiliates by the High Yield Bond Portfolio, Low Duration Bond Portfolio and Core Bond Portfolio represented 0%, 0% and 0%, respectively, of the aggregate brokerage commissions paid and involved 0%, 0% and 0%, respectively, of the dollar amount of transactions involving payment of commissions during the year.

The following table shows the dollar amount of brokerage commissions each Fund paid to brokers for providing third party research services and the approximate dollar amount of the transactions involved for the fiscal year ended September 30, 2022. The provision of third party research services was not necessarily a factor in the placement of all brokerage business with such brokers.

Funds		Amount of Commissions Paid to Brokers for Providing Research Services		Amount of Brokerage Transactions Involved
High Yield Bond Portfolio		$0		$0
Low Duration Bond Portfolio		$0		$0
Core Bond Portfolio		$0		$0

  

As of September 30, 2022, the value of each Fund’s holdings of the securities of its regular brokers or dealers (as defined in Rule 10b-1 under the Investment Company Act), if any portion of such holdings were purchased during the fiscal year ended September 30, 2022, are as follows:

	Regular Broker/Dealer		Debt (D)/Equity (E)		Aggregate Holdings (000s)
High Yield Bond Portfolio	J.P. Morgan Securities LLC		D		$26,017
	Barclays Capital, Inc.		D		$25,384
	Jefferies LLC		D		$13,965
	Citigroup Global Markets Inc.		D		$10,392
	Credit Suisse Securities (USA) LLC		D		$9,696
	Goldman Sachs & Co. LLC		D		$8,959
	Deutsche Bank Securities Inc.		D