As filed with the Securities and Exchange Commission on January 31, 1997
Securities Act File No. 333-7817
Investment Company Act File No. 811-6661
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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)
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MUNIYIELD NEW YORK INSURED FUND II, INC.
(Exact Name of Registrant as Specified in its Charter)
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(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)
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Arthur Zeikel
MuniYield New York Insured Fund II, 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)
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Copies to:
Frank P. Bruno, Esq. Mark B. Goldfus, Esq.
Brown & Wood LLP Merrill Lynch Asset Management
One World Trade Center 800 Scudders Mill Road
New York, New York 10048-0557 Plainsboro, New Jersey 08536
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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 are incorporated by reference from Pre-Effective Amendment No.1
to this Registration Statement (File No. 333-7817) filed on August 21, 1996.
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 VI 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
EXHIBIT
NUMBER
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1(a) -- Articles of Incorporation of the Registrant (a)
(b) -- Articles Supplementary creating Series A AMPS of the Registrant(b)
(c) -- Form of Articles Supplementary creating Series B and Series C AMPS
of the Registrant(h)
2 -- By-Laws of the Registrant(a)
3 -- Not applicable
4 -- Form of Agreement and Plan of Reorganization between the
Registrant, MuniVest New York Insured Fund, Inc. and MuniYield New
York Insured Fund III, Inc.(c)
5(a) -- Form of Certificate for Common Stock(d)
(b) -- Form of Certificate for AMPS (f)
(c) -- Portions of the Articles of Incorporation and the By-Laws of the
Registrant defining the rights of holders of shares of the
Registrant(e)
6 -- Form of Investment Advisory Agreement between the Registrant and
the Investment Adviser(a)
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 (d)
(b) -- Form of Purchase Agreement between the Registrant, the Investment
Adviser and Merrill Lynch relating to the Registrant's AMPS(f)
(c) -- Merrill Lynch Standard Dealer Agreement(a)
8 -- Not applicable
9 -- Custodian Contract between the Registrant and State Street Bank and
Trust Company(d)
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) -- Registrar, Transfer Agency and Service Agreement between the
Registrant and State Street Bank and Trust Company relating to
the Registrant's Common Stock(d)
(b) -- Form of Auction Agent Agreement(f)
(c) -- Form of Broker-Dealer Agreement (f)
(d) -- Form of Letter of Representations(f)
14(a) -- Consent of Deloitte & Touche LLP, independent auditors for the
Registrant(h)
(b) -- Consent of Ernst & Young LLP, independent auditors for MuniVest New
York Insured Fund, Inc. and MuniYield New York Insured Fund III,
Inc.(h)
15 -- Not applicable
16 -- Power of Attorney(g)
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(a) Incorporated by reference to the Registrant's registration statement on
Form N-2 relating to the Registrant's Common Stock (File Nos. 33-47744
and 811-6661), filed with the Securities and Exchange Commission (the
"Commission") on May 8, 1992 (the "Common Stock Registration
Statement").
(b) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registrant's registration statement on Form N-2 relating to the
Registrant's AMPS (File Nos. 33-50304 and 811-6661) (the "AMPS
Registration Statement") filed with the Commission on August 28, 1992.
(c) Included in Exhibit I to the Proxy Statement and Prospectus contained in
this Registration Statement.
(d) Incorporated by reference to Pre-Effective Amendment No. 2 to the Common
Stock Registration Statement filed with the Commission on June 19, 1992.
(e) Reference is made to Article V, Article VI (Sections 2, 3, 4, 5 and 6),
Article VII, Article VIII, Article IX, Article X, Article XI, Article
XII and Article XIII of the Registrant's Articles of Incorporation,
previously filed as Exhibit 1(a) 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, previously filed as Exhibit 1(b) to the Common
Stock Registration Statement.
(f) Incorporated by reference to Registrant's AMPS Registration Statement
filed with the Commission on July 31, 1992.
(g) Included on the signature page of the Registrant's Registration
Statement on Form N-14 filed on July 9, 1996 and incorporated by
reference herein.
(h) Previously filed with Pre-Effective Amendment No. 1 to this N-14
Registration Statement on August 21, 1996.
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 declines 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 the 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
January, 1997.
MUNIYIELD NEW YORK INSURED
FUND II, INC.
(Registrant)
By /s/ GERALD M. RICHARD
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(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.
Signature Title Date
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ARTHUR ZEIKEL/*/ President (Principal
- ------------------------------------- Executive Officer)
(Arthur Zeikel) and Director
GERALD M. RICHARD/*/ Treasurer (Principal
- ------------------------------------- Financial and
(Gerald M. Richard) Accounting Officer)
JAMES H. BODURTHA/*/ Director
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(James H. Bodurtha)
HERBERT I. LONDON/*/ Director
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(Herbert I. London)
ROBERT R. MARTIN/*/ Director
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(Robert R. Martin)
JOSEPH L. MAY/*/ Director
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(Joseph L. May)
ANDRE F. PEROLD/*/ Director
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(Andre F. Perold)
/*/By: /s/ Gerald M. Richard January 30, 1997
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(Gerald M. Richard, Attorney-in-Fact)
EXHIBIT INDEX
EXHIBIT
NUMBER
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12 -- Private Letter Ruling dated October 15, 1996 from the Internal
Revenue Service to Registrant, MuniVest New York Insured Fund, Inc.
and MuniYield New York Insured Fund III, Inc.
EXHIBIT 12
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
Index Number: 0368.03-00 Washington, D.C. 20224
0368.09-00
Thomas A. Humphreys Person to Contact:
Brown & Wood LLP Cheryl M. Peterson
One World Trade Center Telephone Number:
New York, New York 10048-0557 (202) 622-7770
Refer Reply to:
CC:DOM:CORP:2 PLR 06385-96
Date: October 15, 1996
Acquiring = MuniYield New York Insured Fund II, Inc.
EIN: 22-3170745
Target 1 = MuniVest New York Insured Fund, Inc.
EIN: 22-3229822
Target 2 = MuniYield New York Insured Fund III Inc.
EIN: 22-3199513
State X = Maryland
State Y = New York
City Z = New York City
Date B = October 31
C = Auction Rate Market Preferred Stock
Dear Mr. Humphreys:
This letter responds to your letter dated June 7, 1996 requesting
rulings about the federal income consequences of a proposed transaction.
Additional information was submitted on August 1, 1996 and September 25,
1996. The information submitted for consideration is summarized below.
Acquiring is a nondiversified closed end management company organized as
a corporation under the laws of State X. Acquiring uses the accrual method
of accounting and is on a fiscal year ending Date B. Acquiring has elected
and qualified pursuant to Section 851 to be treated for federal income tax
purposes as a regulated investment company ("RIC"). Acquiring currently has
two classes of stock: one class of common stock and one series of voting C
preferred stock. Acquiring's investment objective is to provide as high a
level of current income exempt from federal, State Y and City Z income taxes
as is consistent with its investment policies and prudent investment
management.
Target 1 is a non-diversified closed end management company organized
under the laws of State X. Target 1 uses the accrual method of accounting
and is on a fiscal year ending Date B. Target 1 has elected and qualified
pursuant to section 851 to be created for federal income tax purposes as a
RIC. Target 1 currently has two classes of stock: one class of common stock
and one series of voting C preferred stock. Target 1's investment objective
is to provide as high a level of current income exempt from federal, State Y
and City Z income taxes as is consistent with its investment policies and
prudent investment management.
Target 2 is a non-diversified closed end management company organized
under the laws of State X. Target 2 uses the accrual method of accounting
and is on a fiscal year ending Date B. Target 2 has elected and qualified
pursuant to section 851 to be created for federal income tax purposes as a
RIC. Target 2 currently has two classes of stock: one class of common stock
and one series of voting C preferred stock. Target 2's investment objective
is to provide as high a level of current income exempt from federal, State Y
and City Z income taxes as is consistent with its investment policies and
prudent investment management.
For what are represented to be valid business reasons, the taxpayer has
proposed the following transaction:
(i) Target 1 and Target 2 will each transfer all of their assets and
liabilities to Acquiring in exchange for Acquiring voting common
stock and Acquiring voting C preferred stock ("Acquiring Shares")
and Acquiring's assumptions of the liabilities of Target 1 and
Target 2.
(ii) Target 1 and Target 2 will liquidate and distribute the Acquiring
Shares to its shareholders. Each Target 1 and Target 2 common
stock shareholder will be entitled to receive a proportionate
number of shares of Acquiring common stock equal to the aggregate
net asset value represented by the Target 1 and Target 2 common
stock owned by such shareholder on the exchange date. Each Target
1 and Target 2 C preferred shareholder will be entitled to receive
a number of shares of Acquiring C preferred stock having a
liquidation preference equal to the liquidation preference of the
Target 1 or Target 2 shares owned by such shareholder on the
exchange date.
The following representations have been made in connection with the
proposed transaction:
(a) The fair market value of the Acquiring stock received by each Target 1
and Target 2 shareholder will approximately equal the fair market value
of Target 1 or Target 2 stock surrendered in the exchange (calculated
for the common stock, with reference to the net asset value rather than
the trading price and, for the Acquiring C preferred shares, according
to liquidation preference, as described above).
(b) There is no plan or intention by Target 1 or Target 2 shareholders who
own five percent or more of the stock of Target 1 or Target 2,
respectively, and, there is no plan or intention on the part of any of
the remaining Target 1 or Target 2 shareholders to sell, exchange or
otherwise dispose of a number of shares of Acquiring stock received in
the transaction that would reduce the ownership by the shareholders of
Target 1 or Target 2 of the stock of Acquiring 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
1 or Target 2, respectively, as of the same date. For purposes of this
representation, shares of Target 1 and Target 2 stock exchanged for cash
or other property, surrendered by the dissenters, or in exchange for
cash in lieu of fractional shares of Acquiring stock will be treated as
outstanding Target 1 or Target 2 stock on the date of the transaction.
Moreover, shares of Target 1 and Target 2 stock and shares of Acquiring
stock held by Target 1 and Target 2 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 1 immediately prior to the transaction.
Similarly, 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 2 immediately prior to the
transaction. For purposes of this representation, amounts paid to
Target 1 and Target 2 dissenters, amounts used by Target 1 or Target 2
to pay its reorganization expenses, amounts paid by Target 1 or Target 2
to shareholders who receive cash or other property, and all redemptions
and distributions (except for regular, normal dividends) made by Target
1 or Target 2 immediately preceding the transfer will be included as
assets of the respective Target held immediately prior to the
reorganization.
(d) Acquiring has no plan or intention to reacquire any of its stock issued
in the transaction, except 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 1 or Target 2 acquired in the transaction,
except for dispositions made in the ordinary course of business.
(f) Target 1 and Target 2 will distribute the stock, securities and other
property of Acquiring that it receives in the transaction, and its other
properties, pursuant to the plan of reorganization.
(g) The liabilities of Target 1 and Target 2 assumed by Acquiring and the
liabilities to which the transferred assets are subject were incurred by
Target 1 and Target 2 in the ordinary course of business.
(h) Following the transaction, Acquiring will continue the historic business
of Target 1 or Target 2 or use a significant portion of the historic
assets of Target 1 or Target 2 in a business.
(i) Target 1, Target 2, Acquiring and the shareholders of Target 1 and
Target 2 will bear the burden of their respective expenses, if any,
incurred in connection with the transaction.
(j) There is no intercorporate indebtedness existing between Acquiring and
Target 1 or Target 2 that was issued, acquired, or will be settled at a
discount.
(k) Acquiring, Target 1 and Target 2 qualify as regulated investment
companies under section 851 and thus should be treated as regulated
investment companies for purposes of sections 368(a)(2)(F)(i) and (iii).
(l) Acquiring does not own, directly or indirectly, nor has it owned during
the past five years, directly or indirectly, any stock of Target 1 or
Target 2.
(m) The fair market value of the assets of Target 1 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. Similarly, the fair market value of the assets of Target 2
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.
(n) Cash is being distributed to shareholders of Target 1 and Target 2 in
lieu of fractional shares of Acquiring solely to save Acquiring the
expense and inconvenience of issuing and transferring fractional shares,
and such cash does not represent separately bargained for consideration
in the transaction. The total cash consideration that will be paid
instead of issuing fractional shares of Acquiring stock will not exceed
one percent of the total consideration that will be issued to Target 1
or Target 2 shareholders in exchange for their shares of Target 1 or
Target 2 stock. The fractional share interests of each Target 1 or
Target 2 shareholder will be aggregated and no Target 1 or Target 2
shareholder will receive cash in an amount equal to or greater than the
value of one full share of Acquiring stock.
(o) Target 1, Target 2 and Acquiring have elected to be taxed as RICs under
section 851 and, for all of their taxable periods, (including the last
short taxable period ending on the date of the transaction, for Target 1
and Target 2) have qualified for the special tax treatment afforded RICs
under the Code, and after the transaction, Acquiring intends to continue
to so qualify
(p) Neither Target 1 nor Target 2 is under the jurisdiction of a court in a
Title 11 or similar case within the meaning of section 368(a)(3)(A).
Based solely upon the information and representations set forth above,
we hold as follows:
(1) The acquisition by Acquiring of substantially all of the assets of
Target 1 solely in exchange for Acquiring voting stock and Acquiring's
assumption of liabilities followed by the distribution by Target 1 of
Acquiring Shares to the 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 70
percent of the fair market value of the gross assets and at least 90
percent of the fair market value of the net assets of Target 1.
Additionally, Acquiring and Target 1 will each be "a party to the
reorganization" within the meaning of section 368(b).
(2) The acquisition by Acquiring of substantially all of the assets of
Target 2 solely in exchange for Acquiring voting stock and Acquiring s
assumption of liabilities followed by the distribution by Target 2 of
Acquiring Shares to the 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 70
percent of the fair market value of the gross assets and at least 90
percent of the fair market value of the net assets of Target 2.
Additionally, Acquiring and Target 2 will each be "a party to the
reorganization" within the meaning of section 368(b).
(3) Target 1 and Target 2 will recognize no gain or loss on its transfer of
substantially all of its assets and liabilities to Acquiring in exchange
solely for Acquiring voting stock and Acquiring's assumption of
liabilities (Section 361(a) and 357(a)). Also, Target 1 and Target 2
will recognize no gain or loss on the distribution to their shareholders
of the Acquiring stock that each will receive in the transaction
(Section 361(c)(1)).
(4) Acquiring will not recognize Any gain or loss on the receipt of the
assets of Target 1 and Target 2 in exchange for shares of Acquiring
voting stock (Section 1032(a)).
(5) Acquiring's basis in the assets of Target 1 and Target 2 received in the
reorganization will equal the basis of the assets of Target 1 and Target
2 immediately before the transfer (Section 362(b)).
(6) Acquiring's holding period in the assets received in the reorganization
will include the period during which Target 1 and Target 2 held the
assets (Section 1223(2)).
(7) Common and voting C preferred stock shareholders of Target 1 and Target
2 will recognize no gain or loss on their receipt of common and voting C
preferred stock of Acquiring in exchange for their respective stock,
except to the extent that Target 1 and Target 2 shareholders receive
cash representing an interest in fractional shares of Acquiring in the
reorganization (Section 354(a)(1)).
(8) The basis of the Acquiring stock received by the Target 1 and Target 2
shareholders in the reorganization will equal the basis of the Target 1
and Target 2 shares surrendered in exchange therefor (Section
358(a)(1)).
(9) The holding period of the Acquiring stock received in the reorganization
by the Target 1 and Target 2 shareholders will include the period that
the shareholder held the Target 1 or Target 2 stock exchanged therefor,
provided that the shareholder held such stock as a capital asset on the
date of the exchange (Section 1223(1)).
(10) The payment of cash to Target 1 and Target 2 shareholders in lieu of
fractional shares of Acquiring will be treated as though the fractional
shares were distributed as part of the transaction and then redeemed by
Acquiring. The cash payment will be treated as a distribution in full
payment for the fractional shares deemed redeemed under section 302(a),
with the result that such Target shareholders will have short-term or
long-term capital gain or loss to the extent that the cash distribution
differs from the basis allocable to such fractional shares (Rev. Rul.
66365, 1966-2 C.B. 116).
(11) The taxable years of Target 1 and Target 2 will end on the effective
date of the proposed transaction (Section 381(b)(1)). Acquiring will
succeed to and take into account the items of Target 1 and Target 2
described in section 381(c), including the earnings and profits, or
deficit in earnings and profits, of Target 1 and Target 2 as of the date
of the transaction (Section 381(a) and Section 1.381(a)-1(a) of the
Income Tax Regulations). Any deficit in earnings and profits of Target
1 or Target 2 will be used only to offset earnings and profits
accumulated after the effective date of the proposed transaction
(Section 381(c)(2)(B)). Acquiring will take these items into account
subject to the conditions and limitations specified in sections 381,
382, 383 and 384 and the regulations thereunder.
We express no opinion 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. Specifically, no opinion was requested, and none is expressed,
about whether Acquiring, Target 1 or Target 2 qualifies as a RIC that is
taxable under Subchapter M, Part I of the Code.
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.
Each affected taxpayer must attach a copy of this letter to their
federal income tax return for the tax year in which the transaction covered
by this ruling letter is consummated.
Sincerely yours,
Assistant Chief Counsel
(Corporate)
By /s/ Richard Osborne
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Richard Osborne
Senior Technician Reviewer
Branch 2
cc DD -- Newark, New Jersey
Chief, Examination Division
Donald C. Burke
Vice President
MuniYield New York Insured Fund, Inc.
800 Scudders Mill Road
Plainsboro, NJ 08536
