Exhibit 5-B
[LETTERHEAD OF RYAN, RUSSELL, OGDEN & SELTZER LLP]
February 4, 1999
Metropolitan Edison Company
2800 Pottsville Pike
Reading, Pennsylvania 19605
Re: Registration Statement on Form S-3
(Nos. 333-62967, 333-62967-01 and 333-62967-02)
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Ladies and Gentlemen:
Metropolitan Edison Company (the "Company"), Met-Ed Capital II, L.P.
("Met-Ed Capital II") and Met-Ed Capital Trust ("Met-Ed Trust") have filed with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "1933 Act"), a Registration Statement on Form S-3
dated September 4, 1998, and Amendment No. 1 thereto, dated today's date (as so
amended, the "Registration Statement"), of which this opinion is to be a part.
The Registration Statement relates to the proposed issuance and sale, in one or
more series, by (i) the Company of up to $250,000,000 aggregate principal amount
of its Senior Notes (the "Senior Notes") under the Senior Note Indenture (as
defined in the Registration Statement), which Senior Notes will be secured by
the Company's Senior Note Mortgage Bonds (as defined in the Registration
Statement) until the Release Date (as defined in the Registration Statement),
(ii) Met-Ed Trust of up to $125,000,000 aggregate liquidation value of preferred
beneficial interests, in the form of trust securities (the "Trust Securities"),
representing cumulative preferred limited partner interests of Met-Ed Capital II
(the "Preferred Securities") and (iii) the Company of up to $130,000,000 of its
subordinated debentures (the "Subordinated Debentures") and the Guarantee (as
defined below). Met-Ed Trust will apply the proceeds from the sale of the Trust
Securities to purchase the Preferred Securities. Met-Ed Capital II will, in
turn, lend the proceeds from the sale of its Preferred Securities, plus the
capital contribution made by Met-Ed Preferred Capital II, Inc., a Delaware
special purpose corporation and the sole general partner of Met-Ed Capital II,
to the Company, which loan will be evidenced by the Subordinated Debentures of
the Company. The Company will guarantee (the "Guarantee") the payment by Met-Ed
Capital II of distributions on the Preferred Securities and of amounts due upon
liquidation of Met-Ed Capital II or redemption of the Preferred Securities, all
to the extent set forth in the Guarantee. The Trust Securities are to be issued
by Met-Ed Trust pursuant to an Amended and Restated Trust Agreement (the "Trust
Agreement"), the Preferred Securities are to be issued by Met-Ed Capital II
pursuant to an Amended and Restated Limited Partnership Agreement and one or
more Actions thereunder (collectively, the "Limited Partnership Agreement") and
the Subordinated Debentures are to be issued by the Company pursuant to an
indenture between the Company and United States Trust Company of New York, as
Trustee (the "Debenture Indenture").
We have been Pennsylvania counsel to the Company for many years. In such
capacity, we are familiar with the affairs of the Company and Met-Ed Capital II
and the transactions that are the subject matter of the Registration Statement.
We have examined such records of the Company and Met-Ed Capital II and such
other instruments, documents, certificates and agreements, including the forms
of Trust Agreement, Limited Partnership Agreement, Senior Note Indenture and
Debenture Indenture, and made such further investigation as we have deemed
necessary as a basis for this opinion.
The opinions expressed below are based on the following assumptions:
(a) The proposed transactions are carried out on the basis set forth
in the Registration Statement and in conformity with the authorizations,
approvals, consents or exemptions under the securities laws of various states
and other jurisdictions of the United States;
(b) Prior to issuance of any series of the Senior Notes or the
Senior Note Mortgage Bonds, all necessary corporate action required on the part
of the Company shall have been duly taken and all necessary documents relating
thereto shall have been executed and delivered;
(c) Prior to issuance of any series of the Trust Securities, the
Preferred Securities, the Guarantee or the Subordinated Debentures, all
necessary corporate, partnership and trust action required on the part of the
Company, Met-Ed Preferred Capital II, Inc., Met-Ed Capital II and Met-Ed Trust
shall have been duly taken and all necessary documents relating thereto,
including, without limitation, the Trust Agreement, the Limited Partnership
Agreement, the Guarantee and the Debenture Indenture, shall have been executed
and delivered;
(d) The Commission shall have issued an order declaring effective
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(i) the Registration Statement under the 1933 Act; and
(ii) the Company's related Application, as amended and as may
be further amended, on Form U-1 under the Public Utility Holding Company Act of
1935, as amended (the "1935 Act");
(e) The issuance and sale of the Trust Securities, the Preferred
Securities and Subordinated Debentures do not violate Section 12(f) of the 1935
Act or Rule 70 thereunder; and
(f) The Debenture Indenture, the Senior Note Indenture and the Trust
Agreement will be qualified in accordance with the provisions of the Trust
Indenture Act of 1939, as amended.
Based on the foregoing, insofar as the laws of the Commonwealth of
Pennsylvania are concerned, we are of the opinion that:
(1) when properly executed, authenticated, delivered and paid
for as provided in the Senior Note Indenture, the Senior Notes will
be legally issued and binding obligations of the Company subject to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other laws affecting creditors rights
generally (including, without limitation, the Atomic Energy Act and
applicable regulations of the Nuclear Regulatory Commission
thereunder) and general equitable principles; and
(2) when properly executed, authenticated, delivered and paid
for as provided in the Debenture Indenture, the Subordinated
Debentures will be legally issued and binding obligations of the
Company and, when properly executed and delivered by the Company,
the Guarantee will be legally issued and a binding obligation of the
Company subject, in each case, to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other laws
affecting creditors rights generally (including, without limitation,
the Atomic Energy Act and applicable regulations of the Nuclear
Regulatory Commission thereunder) and general equitable principles.
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We consent to the filing of this opinion as an Exhibit to the Registration
Statement and to the references to this firm under the heading "Legal Matters"
in the Prospectus which is a part of the Registration Statement. In addition, we
consent to the reliance by Berlack, Israels & Liberman LLP upon this opinion.
Very truly yours,
RYAN, RUSSELL, OGDEN & SELZER LLP
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