As filed with the Securities and Exchange Commission on October 31, 1997
Securities Act File No. 333-32915
Investment Company Act File No. 811-6499
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-14
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
/ /Pre-Effective Amendment No. /x/Post Effective Amendment No. 1
(Check appropriate box or boxes)
MUNIYIELD CALIFORNIA FUND, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
(609) 282-2800
(Area Code and Telephone Number)
800 SCUDDERS MILL ROAD
PLAINSBORO, NEW JERSEY 08536
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES:
NUMBER, STREET, CITY, STATE, ZIP CODE)
ARTHUR ZEIKEL
MUNIYIELD CALIFORNIA FUND, INC.
800 SCUDDERS MILL ROAD, PLAINSBORO, NEW JERSEY 08536
MAILING ADDRESS: P.O. BOX 9011, PRINCETON, NEW JERSEY 08543-9011
(NAME AND ADDRESS OF AGENT FOR SERVICE)
COPIES TO:
__________
FRANK P. BRUNO, ESQ. PHILIP L. KIRSTEIN, ESQ.
BROWN & WOOD LLP MERRILL LYNCH ASSET MANAGEMENT
ONE WORLD TRADE CENTER 800 SCUDDERS MILL ROAD
NEW YORK, NEW YORK 10048-0557 PLAINSBORO, NJ 08543-90111
This Amendment consists of the following:
(1) Facing Sheet of the Registration Statement
(2) Part C to the Registration Statement (including signature page).
Parts A and B incorporated by reference from Pre-Effective Amendment No. 1 to
this Registration Statement (File No. 333-32915) filed on September 12, 1997.
This Amendment is being filed solely to file as Exhibit No. 12 to this
Registration Statement the private letter ruling received from the Internal
Revenue Service.
PART C
OTHER INFORMATION
ITEM 15. INDEMNIFICATION.
Section 2-418 of the General Corporation Law of the State of Maryland,
Article VI of the Registrant's Articles of Incorporation, Article IV of the
Registrant's By-Laws and the Registrant's Investment Advisory Agreement with
Fund Asset Management, Inc., now known as Fund Asset Management, L.P. (the
"Investment Adviser") provide for indemnification.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act"), may be provided to directors,
officers and controlling persons of each Fund, pursuant to the foregoing
provisions or otherwise, each Fund has been advised that in the opinion of
the Securities and Exchange Commission, such indemnification is against
public policy as expressed in the Securities Act and, therefore, is
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by a Fund of expenses incurred or paid by
a director, officer or controlling person of the Registrant in connection
with any successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant, unless in the opinion of its
counsel the matter has been settled by controlling precedent, will submit to
a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
Reference is made to (i) Section Six of the Purchase Agreement relating
to the Registrant's Common Stock, a form of which previously was filed as an
exhibit to the Common Stock Registration Statement (as defined below), and
(ii) Section Seven of the Purchase Agreement relating to the Registrant's
AMPS, a form of which previously was filed as an exhibit to the AMPS
Registration Statement (as defined below), for provisions relating to the
indemnification of the underwriter.
ITEM 16. EXHIBITS.
(1) (a) -- Articles of Incorporation of the Registrant(a)
(b) -- Articles of Amendment to the Articles of Incorporation(b)
(c) -- Form of Articles Supplementary creating the AMPS(c)
(d) -- Form of Articles Supplementary creating the Series C AMPS(d)
(2) -- By-Laws of the Registrant(e)
(3) -- Not applicable
(4) -- Form of Agreement and Plan of Reorganization between the
Registrant and Taurus MuniCalifornia Holdings, Inc. (f)
(5) (a) -- Specimen certificate for Common Stock(e)
(b) -- Form of Certificate for AMPS(c)
(c) -- Portions of the Articles of Incorporation and the By-Laws of
the Registrant defining the rights of holders of shares of the
Registrant(g)
(6) -- Form of Investment Advisory Agreement between the Registrant
and the Investment Adviser(e)
(7) (a) -- Form of Purchase Agreement between the Registrant, the
Investment Adviser and Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch") relating to the Registrant's
Common Stock(b)
(b) -- Form of Purchase Agreement between the Registrant, the
Investment Adviser and Merrill Lynch relating to the
Registrant's AMPS(c)
(c) -- Form of Merrill Lynch Standard Dealer Agreement(a)
(8) -- Not applicable
(9) -- Form of Custody Agreement between the Registrant and The Bank
of New York(e)
(10) -- Not applicable
(11) -- Opinion and Consent of Brown & Wood LLP, counsel for the
Registrant(h)
(12) -- Private Letter Ruling from the Internal Revenue Service
(13) (a) -- Form of Transfer Agency and Service Agreement between the
Registrant and The Bank of New York(e)
(b) -- Form of Auction Agent Agreement(e)
(c) -- Form of Broker-Dealer Agreement(e)
(d) -- Form of Depository Agreement(e)
(14) (a) -- Consent of Deloitte & Touche LLP, independent auditors for the
Registrant(h)
(b) -- Consent of Ernst & Young LLP, independent auditors for Taurus
MuniCalifornia Holdings, Inc.(h)
(15) -- Not applicable
(16) -- Power of Attorney(i)
____________
(a) Incorporated by reference to the Registrant's Registration Statement on
Form N-2 relating to the Registrant's Common Stock (File Nos. 33-44445
and 811-6499), filed with the Securities and Exchange Commission (the
"Commission") on December 18, 1991 (the "Common Stock Registration
Statement").
(b) Incorporated by reference to Pre-Effective Amendment No. 1 to the Common
Stock Registration Statement filed with the Commission on January 23,
1992.
(c) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registrant's Registration Statement on Form N-2 relating to the
Registrant's Series A and Series B Auction Market Preferred Shares (File
Nos. 33-45622 and 811-6499), filed with the Commission on March 19,
1992.
(d) Previously filed on August 5, 1997 as an exhibit to the Registrant's
Registration Statement on Form N-14 (File Nos. 333-32915 and 811-6499)
(the "Registration Statement on Form N-14").
(e) Incorporated by reference to Pre-Effective Amendment No. 2 to the Common
Stock Registration Statement ("Pre-Effective Amendment No. 2"), filed
with the Commission on February 21, 1992.
(f) Included as Exhibit I to the Proxy Statement and Prospectus included in
Pre-Effective Amendment No. 1 to the Registration Statement on Form N-
14.
(g) Reference is made to Article V, Article VI (section 6), Article VII,
Article VIII, Article X, Article XI, Article XII and Article XIII of the
Registrant's Articles of Incorporation, filed as Exhibit 1 to the Common
Stock Registration Statement; and to Article II, Article III (sections
1, 3, 5 and 17), Article VI, Article VII, Article XII, Article XIII and
Article XIV of the Registrant's By-Laws, filed as Exhibit 1 to Pre-
Effective Amendment No. 2.
(h) Previously filed on September 12, 1997 as an exhibit to Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-14.
(i) Included on the signature page of the Registration Statement on Form N-
14.
ITEM 17. UNDERTAKINGS.
(a) The Registrant undertakes to suspend offering of the shares of
Common Stock covered hereby until it amends its Prospectus contained herein
if (1) subsequent to the effective date of this Registration Statement, its
net asset value per share of Common Stock declined more than 10 percent from
its net asset value per share of Common Stock as of the effective date of
this Registration Statement, or (2) its net asset value per share of Common
Stock increases to an amount greater than its net proceeds as stated in the
Prospectus contained herein.
(b) The Registrant undertakes that: (1) For the purpose of determining
any liability under the Securities Act, the information omitted from the form
of prospectus filed as part of a registration statement in reliance upon Rule
430A and contained in the form of prospectus filed by the Registrant pursuant
to Rule 497(h) under the Securities Act shall be deemed to be a part of the
registration statement as of the time it was declared effective. (2) For the
purpose of determining any liability under the Securities Act, each post-
effective amendment that contains a form of prospectus shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be an initial
bona fide offering thereof.
SIGNATURES
As required by the Securities Act of 1933, this Post-Effective Amendment
to the Registration Statement has been signed on behalf of the Registrant, in
the Township of Plainsboro and State of New Jersey, on the 30th day of
October, 1997.
MUNIYIELD CALIFORNIA FUND, INC.
(Registrant)
By: /s/ Gerald M. Richard
---------------------------------
(Gerald M. Richard, Treasurer)
As required by the Securities Act of 1933, this Post-Effective Amendment
to the Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signatures Title Date
ARTHUR ZEIKEL* President (Principal
- ------------------------- Executive Officer) and
(Arthur Zeikel) Director
/s/ Gerald M. Richard Treasurer (Principal October 30, 1997
- ------------------------- Financial and
(Gerald M. Richard) Accounting Officer)
JAMES H. BODURTHA* Director
- -------------------------
(James H. Bodurtha)
HERBERT J. LONDON* Director
- -------------------------
(Herbert J. London)
ROBERT R. MARTIN* Director
- -------------------------
(Robert R. Martin)
JOSEPH L. MAY* Director
- -------------------------
(Joseph L. May)
ANDRE F. PEROLD* Director
- -------------------------
(Andre F. Perold)
*By: /S/ GERALD M. RICHARD October 30, 1997
- ------------------------------------------
(Gerald M. Richard, Attorney-in-Fact)
Index Number: 0368.00-00
Mr. Donald Burke Marnie Rapaport
Vice President
MuniYield California Fund, Inc. (202) 622-7550
800 Scudders Mill Road
Plainsboro, N.J. 08536 CC:DOM:CORP:5-PLR-114862-97
Mr. Donald Burke
Vice President
Taurus MuniCalifornia Holdings, Inc.
800 Scudders Mill Road
Plainsboro, N.J. 08536 "This document may not be used
or cited as precedent Section
6110 (j) (3) of the Internal
Revenue Code."
Acquiring = MuniYield California Fund, Inc.
a Maryland corporation
EIN: 22-3144221
Target = Taurus MuniCalifornia Holdings, Inc.
a Maryland corporation
EIN: 22-3006399
State X = Maryland
Manager = Fund Asset Management, L.P.
Dear Mr. Burke:
This is in reply to a letter dated July 29, 1997 requesting rulings as
to the federal income tax consequences of a proposed transaction.
Target, a State X corporation, is a non-diversified, closed-end
management investment company and is operated in a manner intended to qualify
it as a regulated investment company ("RIC"), within the meaning of Section
851 of the Internal Revenue Code. Target has issued and outstanding two
classes of stock: one class of voting common stock and one series of voting
preferred stock.
Acquiring, a State X corporation, is a non-diversified, open-end
management investment company and is operated in a manner intended to qualify
it as a RIC. Acquiring has outstanding two classes of stock: one class of
voting common stock and two series of voting preferred stock, designated as
Series A and Series B.
The Manager manages both Target and Acquiring.
For what is represented to be a valid business purpose, Target will
transfer all of its assets to Acquiring, solely in exchange for newly issued
Acquiring voting common stock, voting preferred stock, and the assumption by
Acquiring of Target's liabilities, and Target will distribute all of the
Acquiring stock to its shareholders and liquidate.
Target shareholders will receive, in liquidation, all of the Acquiring
common stock and preferred stock received by Target in the exchange. Each
Target common shareholder will receive a proportionate number of Acquiring
common shares equal to the aggregate net asset value of the Target common
stock owned by such shareholder on the exchange date. Each Target preferred
shareholder will, similarly, receive a number of Acquiring preferred shares
having a liquidation preference and value equal to the liquidation preference
and value of the Target preferred shares owned by such shareholder on the
exchange date.
No fractional share interests will be issued. Rather, all fractional
shares of Acquiring's common stock will be aggregated into whole shares by
Acquiring's agent for sale on the open market. The agent will then remit the
cash proceeds of sale to Target common shareholders otherwise entitled to
receive fractional share interests in Acquiring common stock in accordance
with their interests.
The following representations have been made in connection with the
proposed transaction:
(a) The fair market value of the Acquiring stock to be received by each
Target shareholder will be approximately equal to the fair market
value of the Target stock surrendered in the exchange (calculated,
for the Acquiring common stock, with reference to net asset value
rather than trading price and, for the Acquiring preferred stock,
according to liquidation preference).
(b) To the best of the knowledge of management of Target, there is no
plan or intention by the Target shareholders who own 5 percent or
more of the Target stock, and to the best of the knowledge of
management of Target, there is no plan or intention on the part of
the remaining shareholders of Target to sell, exchange, or
otherwise dispose of a number of shares of Acquiring stock received
in the transaction that would reduce the Target shareholders'
ownership of Acquiring stock to a number of shares having a value,
as of the date of the transaction, of less than 50 percent of the
value of all of the formerly outstanding stock of Target as of the
same date. For purposes of this representation, shares of Target
surrendered by dissenters, or exchanged for cash in lieu of
fractional shares of Acquiring stock will be treated as outstanding
on the date of the transaction. Moreover, shares of Target stock
and shares of Acquiring stock held by Target shareholders and
otherwise sold, redeemed, or disposed of prior or subsequent to the
transaction will be considered in making this representation.
(c) Acquiring will acquire at least 90 percent of the fair market value
of the net assets and at least 70 percent of the fair market value
of the gross assets held by Target immediately prior to the
transaction. For purposes of this representation, amounts paid by
Target to dissenters, amounts used by Target to pay its
reorganization expenses, amounts paid by Target to shareholders who
receive cash or other property, and all redemptions and
distributions (except for regular, normal dividends) made by Target
immediately preceding the transfer will be included as assets of
Target held immediately prior to the transaction.
(d) Acquiring has no plan or intention to reacquire any of its stock
issued in the transaction other than in the ordinary course of its
business.
(e) Acquiring has no plan or intention to sell or otherwise dispose of
any of the assets of Target acquired in the transaction, except for
dispositions made in the ordinary course of business.
(f) Target will distribute the stock of Acquiring it receives in
the transaction, in pursuance of the plan of reorganization.
(g) The liabilities of Target assumed by Acquiring and the liabilities
to which the transferred assets are subject were incurred by Target
in the ordinary course of its business.
(h) Following the transaction, Acquiring will continue the historic
business of Target or use a significant portion of Target's
historic business assets in a business.
(i) Acquiring, Target, and the shareholders of Target will pay their
respective expenses, if any, incurred in connection with the
transaction.
(j) There is no intercorporate indebtedness existing between Acquiring
and Target that was issued, acquired, or will be settled at a
discount.
(k) Acquiring does not own, directly or indirectly, nor has it owned
during the past five years, directly or indirectly, any stock of
Target.
(l) The fair market value of the assets of Target transferred to
Acquiring will equal or exceed the sum of the liabilities assumed
by Acquiring, plus the amount of liabilities, if any, to which the
transferred assets are subject.
(m) Target is not under the jurisdiction of a court in a Title 11 or
similar case within the meaning of Section 368(a)(3)(A).
(n) Acquiring qualifies as a RIC and has so qualified since its
formation. Acquiring has been subject to the provisions of
Sections 851-855 and will continue to be subject to those
provisions after the consummation of the proposed transaction.
(o) Target qualifies as a RIC and has so qualified since its formation.
Target has been subject to the provisions of Sections 851-855
and will continue to be subject to those provisions until the
consummation of the proposed transaction.
(p) The payment of cash in lieu of fractional share interests of
Acquiring common stock is solely to avoid the expense and
inconvenience to Acquiring of issuing fractional share interests,
and does not represent separately bargained for consideration. The
total cash consideration that will be paid in the transaction to
Target shareholders instead of issuing fractional shares of
Acquiring common stock will not exceed 1 percent of the total
consideration that will be issued in the transaction to Target
shareholders in exchange for their shares of Target stock. The
fractional shares interests of each Target shareholder will be
aggregated, and no Target shareholder will receive cash in an
amount equal to or greater than the value of one full share of
Acquiring stock.
Based solely on the information submitted and on the representations set
forth above, it is held as follows:
(1) The transfer by Target of substantially all of its assets to
Acquiring solely in exchange for Acquiring voting common and
preferred stock and the assumption of the liabilities of Target,
followed by the distribution by Target of the Acquiring voting
stock to its shareholders in complete liquidation, will constitute
a "reorganization" within the meaning of Section 368(a)(1)(C). For
purposes of this ruling, "substantially all" means at least 90
percent of the fair market value of the net assets and at least 70
percent of the fair market value of the gross assets of Target.
Target and Acquiring will each be a "party to a reorganization"
within the meaning of Section 368(b).
(2) No gain or loss will be recognized by Target on the transfer of
substantially all of its assets to Acquiring solely in exchange for
Acquiring voting stock and the assumption of its liabilities, or on
the distribution of the Acquiring voting stock received pursuant to
the plan of reorganization to its shareholders
(Sections 361(a), 357(a), and 361(c)).
(3) No gain or loss will be recognized by Acquiring on the receipt of
Target's assets solely in exchange for shares of Acquiring voting
stock (Section 1032(a)).
(4) The basis of the assets of Target in the hands of Acquiring will be
the same as the basis of those assets in the hands of Target
immediately prior to the transaction (Section 362(b)).
(5) The holding period for the assets of Target in the hands of
Acquiring will include the period during which those assets were
held by Target (Section 1223(2)).
(6) No gain or loss will be recognized by the shareholders of Target on
the exchange of their stock in Target for shares of Acquiring
common stock and preferred stock (including the deemed receipt of
any fractional share interests of Acquiring common stock to which
they may be entitled) (Section 354(a)(1)).
(7) The basis of the Acquiring common stock and preferred stock
(including any fractional shares interests of common stock deemed
received) to be received by shareholders of Target will be the same
as the basis of the Target common and preferred stock surrendered
in exchange therefor (Section 358(a)(1)).
(8) The holding period of the Acquiring stock to be received by
shareholders of Target will include the holding period of the
Target stock surrendered in exchange therefor, provided the Target
stock was held as a capital asset on the date of the exchange
(Section 1223(1)).
(9) Where cash is received by a Target shareholder in lieu of
fractional share interests of Acquiring common stock, such share
will be treated as having been disposed of by such shareholder in a
sale or exchange, and the gain (or loss) will be treated as a
capital gain (or loss), provided such stock was held as a capital
asset by the selling Target shareholder (Section 1001)).
(10) The taxable year of Target will end on the effective date of the
transaction (Section 1.381(b)-l(a) of the Income Tax Regulations),
and as provided in Section 381(a) and Section 1.381(a)-(1),
Acquiring will succeed to and take into account those attributes of
Target described in Section 381(c), subject to the provisions and
limitations specified in Sections 381, 382, 383, and 384, if
applicable, and the regulations thereunder.
(11) Pursuant to Section 381(c)(2) and Section 1.381(c)(2)-1, Acquiring
will succeed to and take into account the earnings and profits, or
deficit in earnings and profits, of Target as of the date of
transfer. Any deficit in earnings and profits of either Target or
Acquiring will be used only to offset the earnings and profits
accumulated after the date of the transfer.
No opinion is expressed about the tax treatment of the proposed
transaction under other provisions of the Code and regulations or about the
tax treatment of any conditions existing at the time of, or effects resulting
from, the proposed transaction that are not specifically covered by the above
rulings.
This ruling letter is directed only to the taxpayers who requested it.
Section 6110(j)(3) provides that it may not be used or cited as precedent.
It is important that a copy of this letter be attached to the federal
income tax returns of the taxpayers involved for the taxable year in which
the transaction covered by this ruling letter is consummated.
Pursuant to the power of attorney on file in this office, a copy of this
letter has been sent to the taxpayers' authorized representative.
Sincerely yours,
Assistant Chief Counsel (Corporate)
By: /s/ David P. Madden
-----------------------------
David P. Madden
Chief, Branch 5
