Blackrock Muniyield New York Quality Fund, Inc. – ‘N-14/A’ on 5/3/00

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Pre-Effective Amendment to Registration Statement of an Open-End Investment Company (Business Combination)   —   Form N-14
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: N-14/A      T:\Edgar\Buford\682311.Txt                            10±    41K 

Document Table of Contents

As filed with the Securities and Exchange Commission on May 3, 2000             

                                             Securities Act File No. 333-88423
                                      Investment Company Act File No. 811-6500
=============================================================================== 

SECURITIES AND EXCHANGE COMMISSION  

WASHINGTON, D.C. 20549  
--------------------  

FORM N-14 

Registration Statement  

under 

the Securities Act of 1933  

------------------  

PRE-EFFECTIVE AMENDMENT NO.                  POST-EFFECTIVE AMENDMENT NO. 1 |X| 
(CHECK APPROPRIATE BOX OR BOXES)  

------------------  

MUNIYIELD NEW YORK INSURED FUND, INC. 
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS 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)  

------------------  

Terry K. Glenn  
MuniYield New York Insured 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.                        Michael J. Hennewinkel, Esq.    
  BROWN & WOOD LLP                        MERRILL LYNCH ASSET MANAGEMENT, L.P.
One World Trade Center                           800 Scudders Mill Road         
New York, NY 10048-0557                            Plainsboro, NJ 08536         

------------------  

This amendment consists of the following:                                       

(1)      Facing Sheet of the Registration Statement.                            

(2)      Part C to the Registration Statement (including signature page).       

The Proxy Statement and Prospectus are incorporated by reference from 
Pre-Effective Amendment No. 1 to this Registration Statement (file No.          
333-88423) filed on November 9, 1999.                                           

This amendment is being filed solely to file as Exhibit No. 12 to this          
Registration Statement the private letter rulings 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 Amended and Restated Articles of Incorporation,  
a form of which was previously filed as an exhibit to the Common Stock          
Registration Statement (defined below); Article VI of the Registrant's          
By-Laws, which was previously filed as an exhibit to the Common Stock           
Registration Statement, and the Investment Advisory Agreement, a form of which  
was previously filed as an exhibit to the Common Stock Registration Statement,  
provide for indemnification.                                                    

 Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "1933 Act"), may be provided to directors,         
officers and controlling persons of the Registrant, pursuant to the foregoing   
provisions or otherwise, the Registrant has been advised that in the opinion    
of the Securities and Exchange Commission, such indemnification is against      
public policy as expressed in the 1933 Act and is, therefore, unenforceable.    
In the event that a claim for indemnification against such liabilities (other   
than the payment by the Registrant 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 will, unless in the opinion of its counsel     
the matter has been settled by controlling precedent, submit to a court of      
appropriate jurisdiction the question whether such indemnification by it is     
against public policy as expressed in the 1933 Act and will be governed by the  
final adjudication of such issue.                                               

  Reference is made to (i) Section 6 of the Purchase Agreement relating to
the Registrant's Common Stock, a form of which was filed as an exhibit to the   
Common Stock Registration Statement, and (ii) Section 7 of the Purchase         
Agreement relating to the Registrant's AMPS, a form of which was filed as an    
exhibit to the AMPS Registration Statement (defined below), for provisions      
relating to the indemnification of the underwriter.                             

Item 16.  Exhibits.                                                             

1 (a)-Articles of Incorporation of the Registrant, dated December 17, 1991. (c) 
(b)-Articles of Amendment relating to name change. (c)                      
(c)-Form of Articles Supplementary creating the Series A AMPS and the       
Series B AMPS. (c)                                                  
(d)-Form of Articles Supplementary creating the Series C AMPS, the Series D 
AMPS and the Series E AMPS. (b)                                     
2    -By-Laws of the Registrant. (c)                                            
3    -Not Applicable.                                                           
4    -Form of Agreement and Plan of  Reorganization  among the  Registrant      
 and MuniYield New York Insured Fund 11, Inc.  (included in Exhibit 11
  to the Proxy Statement and Prospectus  contained in this  Registration
Statement). (c)                                                     
5 (a)-Copies of  instruments  defining  the rights of  stockholders,            
   including  the  relevant  portions of the Articles of Incorporation and
the By-Laws of the Registrant.(a)                                   
6    -Form of Investment Advisory Agreement between the Registrant and          
Fund Asset Management, L.P. (c)                                     
7 (a)-Form of Purchase Agreement for the Common Stock. (c)                      
(b)-Form of Purchase Agreement for the AMPS. (c)                            
(c)-Form of Merrill Lynch Standard Dealer Agreement. (c)                    
8    -Not applicable.                                                           
9    -Custodian Contract between the Registrant and The Bank of New York. (c)   
10   -Not applicable.                                                           
11   -Opinion and Consent of Brown & Wood LLP, counsel for the Registrant. (c)  
12   -Private Letter Ruling from the Internal Revenue Service.                  
13(a)-Transfer  Agency,  Dividend  Disbursing  Agency and Shareholder           
Servicing Agency  Agreement  between the Registrant and The Bank of 
New York. (c)                                                       
(b)-Form of Auction Agent Agreement between the Registrant and IBJ Whitehall
Bank & Trust Company. (c)                                           
(c)-Form of Broker-Dealer Agreement. (c)                                    
(d)-Form of Letter of Representations. (c)                                  
14(a)-Consent of Deloitte & Touche LLP, independent auditors for the            
Registrant. (c)                                                     
(b)-Consent of Deloitte & Touche LLP,  independent  auditors for MuniYield  
  New York Insured Fund II, Inc. for each of the years in the  four-year
period  ended  October  31,  1996 and the period  June 26,  1992 to 
October 31, 1992. (c)                                               
(c)-Consent of Ernst & Young LLP,  independent  auditors  for  MuniYield    
   New York  Insured Fund II, Inc. for each of the two years in the period
ended October 31, 1998. (c)                                         
15   -Not applicable.                                                           
16   -Power of Attorney. (c)                                                    
---------------                                                                 

(a)    Reference is made to Article V, Article VI (sections 2, 3, 4, 5          
   and 6), Article VII, Article VIII, Article X, Article XI, Article XII
and Article XIII of the Registrant's Articles of Incorporation,   
previously filed as Exhibit (1) to the Common Stock Registration  
     Statement, and to Article II, Article III (sections 1, 2, 3, 5 and 17),
  Article VI, Article VII, Article XII, Article XII and Article XIV of
    the Registrant's By-Laws previously filed as Exhibit (2) to the Common
 Stock Registration Statement. Reference is also made to the Form of
   Articles Supplementary filed as Exhibit l(d) to the AMPS Registration
Statement and as Exhibit 1(e) hereto.                             

(b)    Filed on October 4, 1999, as an Exhibit to the Registrant's              
Registration Statement on Form N-14 (File No. 333-88423).         

(c)    Filed on November 9, 1999, as an Exhibit to Pre-Effective Amendment      
No. 1 to the Registrant's Registration Statement on Form N-14     
(File No. 333-88423).                                             

Item 17. Undertakings.                                                          

(1) The undersigned Registrant agrees that prior to any public        
reoffering of the securities registered through use of a prospectus which is    
part of this Registration Statement by any person or party who is deemed to be  
an underwriter within the meaning of Rule 145(c) of the Securities Act of       
1933, as amended, the reoffering prospectus will contain information called     
for by the applicable registration form for reofferings by persons who may be   
deemed underwriters, in addition to the information called for by other items   
of the applicable form.                                                         

(2) The undersigned Registrant agrees that every prospectus that      
is filed under paragraph (1) above will be filed as Part of an amendment to     
the registration statement and will not be used until the amendment is          
effective, in determining any liability under the Securities Act of 1933, as    
amended, each post-effective amendment shall be deemed to be a new              
registration statement for the securities offered therein, and the offerings    
at that time shall be deemed to be the initial bona fide offering of them.      

(3) The Registrant undertakes to file, by post-effective              
amendment, either a copy of the Internal Revenue Private letter ruling applied  
for or an opinion of counsel as to certain tax matters, within a reasonable     
receipt of such ruling or opinion.                                              

SIGNATURES  

As required by the Securities Act of 1933, this Registration Statement
has been signed on behalf of the Registrant, in the Township of Plainsboro and  
State of New Jersey, on the 3rd day of May, 2000.                               

                                       MUNIYIELD NEW YORK INSURED FUND, INC.
                        (Registrant)

                            By    /s/ Terry K. Glenn
                                          ----------------------------------
                                     (Terry K. Glenn, President)

EXHIBIT INDEX 

Exhibit                                                                         
Number                              Description                                 
-------                             -----------                                 

12                                  Private Letter Ruling from the Internal     
        Revenue Service.

Internal Revenue Service            Department of the Treasury                  

Index Number: 0368.00-00            Washington, DC 20224                        

Donald C. Burke                     Person to Contact:                          
Vice President and Treasurer        Kevin Shea Id# 50-06578                     
MuniYield New York Insured Fund II  Telephone Number:                           
800 Scudders Mill Road              (202) 622-7550                              
Plainsboro, NJ 08536                Refer Reply To:                             
                    CC:DOM:CORP:5 -PLR-115971-99
Date:   
     March 2, 2000

Acquiring         =        MuniYield New York Insured Fund                      
a Maryland corporation    
EIN 22-3144223            

Target Fund       =        MuniYield New York Insured Fund II                   
a Maryland corporation    
EIN 22-3170745            

State A           =        Maryland                                             

Dear Mr. Burke:                                                                 

 This is in reply to a letter dated September 24, 1999, in which rulings
are requested as to the federal income tax consequences of a proposed           
transaction. Additional information was submitted in letters dated December     
20, 1999, and January 12 and March 1, 2000. The facts submitted for             
consideration are substantially as set forth below.                             

Acquiring is a closed-end nondiversified management investment company
organized under the laws of State A. Acquiring has elected to be taxed as a     
regulated investment company ("RIC") under ss.ss.851-855 of the Internal        
Revenue Code. Acquiring has outstanding voting common stock and two series of   
voting preferred stock.                                                         

Target Fund a closed-end nondiversified management investment company 
organized under the laws of State A. Target Fund has elected to be taxed as a   
RIC under ss.ss.851-855 of the Internal Revenue Code. Target Fund has           
outstanding voting common stock and four series of voting preferred stock.      

Each of Acquiring and Target Fund is registered under the Investment  
Company Act of 1940.                                                            

For what are represented to be valid business reasons, the following  
transaction is proposed:                                                        

(i)       Target Fund will transfer all of its assets and             
       liabilities to Acquiring in exchange for Acquiring voting
common stock and voting preferred stock.          

 (ii)      Target Fund will dissolve and distribute the Acquiring voting
         common and voting preferred stock to its shareholders. Each
          Target Fund common stockholder will be entitled to receive a
          proportionate number of Acquiring common shares equal to the
             aggregate net asset value of the Target Fund common stock owned
        by such shareholder on the exchange date. Each Target Fund
            preferred shareholder, likewise, will be entitled to receive a
       number of Acquiring preferred shares having a liquidation
          preference and value equal to the liquidation preference and
          value of the Target Fund shares owned by such shareholder on
             the exchange date. Target Fund's preferred shares have the same
   terms as the Acquiring preferred shares to be issued.

(iii)     Acquiring may sell up to 66 percent of the assets received  
             in the transfers and will reinvest the proceeds consistent with
             its investment objectives and policies. Acquiring will not sell
        more than 66 percent of Target Fund's assets following the
transaction.                                      

  No fractional shares will be issued by Acquiring in the transaction. All
fractional shares of Acquiring common stock will be aggregated and sold and     
the fractional shareholders will receive cash in lieu thereof.                  

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 Fund shareholder will be approximately equal to the
           fair market value of the Target Fund stock surrendered in the
exchange.                                         

 (b)       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 Fund
        immediately prior to the transaction. For purposes of this
        representation, amounts paid by Target Fund to dissenters,
             amounts used by Target Fund to pay its reorganization expenses,
             amounts paid by Target Fund to shareholders who receive cash or
           other property, and all redemptions and distributions (except
            for regular, normal dividends) made by Target Fund immediately
             preceding the transfer will be included as assets of the Target
Fund held immediately prior to the transaction.   

(c)       Acquiring has no plan or intention to reacquire any of its  
stock issued in the transaction.                  

(d)       After the transaction, Acquiring will use the assets        
      acquired from Target Fund in its business, except that a
             portion of these assets may be sold or otherwise disposed of in
          the ordinary course of Acquiring's business and as set forth
          above in step (iii) of the transaction. Any proceeds will be
            invested in accordance with Acquiring's investment objectives.
      Otherwise, Acquiring has no plan or intention to sell or
            otherwise dispose of any of the assets of Target Fund acquired
             in the transaction except for dispositions made in the ordinary
course of business.                               

(e)       Target Fund will distribute to its shareholders the stock of
        Acquiring received pursuant to the plan of reorganization.

(f)       The liabilities of Target Fund assumed by Acquiring and     
            any liabilities to which the transferred assets of Target Fund
             are subject were incurred by Target Fund in the ordinary course
of its business.                                  

(g)       Following the transaction, Acquiring will continue the      
           historic business of Target Fund or use a significant portion
         of Target Fund's historic business assets in the continuing
business.                                         

(h)       Target Fund, Acquiring and the shareholders of Target       
          Fund will pay their respective expenses, if any, incurred in
connection with the transaction.                  

(i)       There is no intercorporate indebtedness existing between    
             Target Fund and Acquiring that was issued, acquired, or will be
settled at a discount.                            

  (j)       Acquiring and Target Fund meet the requirements of a regulated
    investment company as referred to in ss. 368(a)(2)(F).

(k)       The fair market value of the assets of Target Fund          
          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.                                          

(1)       At the time of the transaction, Acquiring will not have     
           any outstanding warrants, options, convertible securities, or
          any type of right pursuant to which any person could acquire
       stock in Acquiring that, if exercised or converted, would
             affect the Target Fund's shareholders' acquisition or retention
  of Control of Acquiring, defined in ss.368(a)(2)(H).

(m)       Cash is being distributed to shareholders of Target Funds 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 to Target Fund shareholders
          instead of issuing fractional shares of Acquiring stock will
            not exceed one percent of the total consideration that will be
          issued in the transaction to the Target Fund shareholders in
            exchange for their shares of Target Fund stock. The fractional
          share interests of each shareholder of a Target Fund 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.                                  

   (n)       Target Fund is not under the jurisdiction of a court in a title
       11 or similar case within the meaning of ss.368(a)(3)(A).

(o)       Target Fund and Acquiring have elected to be taxed as       
     RICs under ss.851, and for all of their taxable periods
            (including the last short taxable period ending on the date of
       the transaction, for Target Fund), have qualified for the
           special tax treatment afforded RICs under the Code. After the
       transaction, Acquiring intends to continue to so qualify.

(p)       There is no plan or intention for Acquiring (the issuing    
             corporation as defined in ss.1.368-1 (b)) or any person related
        (as defined in ss.1.3681 (e)(3)) to Acquiring, to acquire,
      during the five year period beginning on the date of the
           proposed transaction, with consideration other than Acquiring
            stock, Acquiring stock furnished in exchange for a proprietary
         interest in Target Fund in the proposed transaction, either
            directly or through any transaction, agreement, or arrangement
          with any other person, except for cash distributed to Target
        Fund's common shareholders in lieu of fractional shares of
Acquiring common stock.                           

  (q)       During the five year period ending on the date of the proposed
           transaction: i) neither Acquiring, nor any person related (as
            defined in ss.1.368-1 (e)(3)) to Acquiring, will have acquired
         Target Fund's stock with consideration other than Acquiring
        stock; ii) neither Target Fund, nor any person related (as
defined in ss.1.368-1(e)(3) without regard to     
        ss.1.368-1(e)(3)(i)(A)) to Target Fund, will have acquired
         Target Fund's stock with consideration other than Acquiring
          stock or Target Fund's stock; and iii) no distributions will
            have been made with respect to Target Fund's stock (other than
             ordinary, normal, regular, dividend distributions made pursuant
         to Target Fund's historic dividend paying practice), either
            directly or through any transaction, agreement, or arrangement
          with any other person, except for a) cash paid to dissenters
         and b) distributions described in ss.ss.852 and 4982 of the
         Code, as required for Target Fund's tax treatment as a RIC.

(r)       The aggregate value of the acquisitions, redemptions, and   
            distributions discussed in paragraphs (p) and (q), above, will
          not exceed 50 percent of the value (without giving effect to
     the acquisitions, redemptions and distributions) of the
          proprietary interest in Target Fund on the effective date of
the proposed transaction.                         

 (s)       After the transaction, shareholders of Target Fund will be in
         control of Acquiring within the meaning of ss.368(a)(2)(H).

(t)       The total adjusted basis of the assets of the Target        
           Fund transferred to Acquiring will equal or exceed the sum of
            liabilities to be assumed by Acquiring, plus the amount of the
     liabilities, if any to which the transferred assets are
subject.                                          

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 Fund in exchange for voting shares of Acquiring stock
      and Acquiring's assumption of Target Fund's liabilities,
             followed by the distribution of Target Fund to its shareholders
       of Acquiring shares and any remaining assets, in complete
      liquidation, will qualify as a reorganization within the
          meaning of ss.368(a)(1)(D) of the Code. Acquiring and Target
           Fund each will be deemed a "party to a reorganization" within
the meaning of ss.368(b).                         

(2)       No gain or loss will be recognized by Target Fund upon the  
             transfer of substantially all of its assets to Acquiring solely
    in exchange for Acquiring voting stock and Acquiring's
 assumption of Target Fund's liabilities or upon the
             distribution of Acquiring stock to the Target Fund shareholders
(ss.ss.361 (a) and (c), 357(a)).                  

   (3)       Acquiring will not recognize any gain or loss on the receipt of
        the assets of Target Fund in exchange for voting shares of
Acquiring (ss.l032(a)).                           

(4)       The basis of Target Fund's assets in the hands of Acquiring 
           will be the same as the basis of those assets in the hands of
 Target Fund immediately prior to the reorganization
(ss.362(b)).                                      

  (5)       Acquiring's holding period for the Target Fund assets acquired
           will include the period during which such assets were held by
the Target Fund (ss.1223(2)).                     

  (6)       The shareholders of Target Fund will not recognize any gain or
          loss on the receipt of voting shares of Acquiring (including
        fractional shares to which they may be entitled) solely in
      exchange for their shares in Target Fund (ss.354(a)(1)).

(7)       The basis of the Acquiring shares received by Target Fund   
            shareholders (including fractional shares to which they may be
           entitled) will be the same, in the aggregate, as the basis of
            the Target Fund shares surrendered in exchange (ss.358(a)(1)).

(8)       The holding period of the Acquiring shares received by      
        Target Fund shareholders in exchange for their Target Fund
      shares (including fractional shares to which they may be
          entitled) will include the period during which the exchanged
         Target Fund shares were held, provided that the Target Fund
           shares are held as a capital asset in the hands of the Target
        Fund shareholder on the date of the exchange (ss.1223(l)).

(9)       Any gain or loss realized by a shareholder of Target        
           Fund upon the sale of fractional share interests of Acquiring
       voting stock to which the stockholder is entitled will be
      recognized to the shareholder measured by the difference
      between the amount of cash received and the basis of the
    fractional share interest. Where the stock surrendered
           qualifies as a capital asset in the hands of the shareholder,
             such gain or loss will be a capital gain or loss subject to the
            provisions and limitations of Subchapter P of Chapter 1 of the
Code.                                             

(10)      Pursuant to ss.381(a) and ss.1.381(a)-l, Acquiring will     
            succeed to and take into account the items of the Target Funds
    described in ss.381 (c), subject to the conditions and
          limitations specified in ss.ss.381(b) and (c), 382, 383, and
384.                                              

No opinion is expressed about the tax treatment of the proposed       
transaction under other provisions of the Code or 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 letter is directed only to the taxpayer who requested it. Section
611 0(k)(3) provides that it may not be used or cited as precedent.             

   A copy of this letter should be attached to the federal income tax return
of the taxpayers involved for the taxable year in which the transaction         
covered by this letter is consummated.                                          

Pursuant to a power of attorney on file in this office, a copy of this
letter has been sent to the taxpayer's representative.                          

Sincerely,  
                       Assistant Chief Counsel (Corporate)

                     By:           /s/ CHARLES WHEDBEE
                        ------------------------------
   Charles Whedbee
                       Senior Technical Reviewer, Branch 5

Dates Referenced Herein   and   Documents Incorporated by Reference

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