April 4, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: Vanguard Cellular Systems, Inc.
Registration Statement on Form S-3
File No. 33-61295
Gentlemen:
We have represented Vanguard Cellular Systems, Inc. (the
"Corporation"), a North Carolina corporation, in connection with the offer for
sale under the Securities Act of 1933, as amended (the "Act") of $200,000,000
aggregate principal amount of the Corporation's Senior Debentures due 2006 (the
"Debentures").
In such connection, we have examined the Corporation's Articles of
Incorporation, including all amendments thereto, its Bylaws, including all
amendments thereto, such of its other corporate records as we deemed necessary
or advisable for purposes of rendering this opinion, the Registration Statement
on Form S-3 relating to the Debentures and other securities of the Corporation
(the "Registration Statement") filed with the Securities and Exchange Commission
(the "Commission") on July 25, 1995, as amended by Amendments No. 1, 2 and 3 to
the Registration Statement filed with the Commission on September 11, 1995,
September 22, 1995 and October 2, 1995, respectively, including the Prospectus
therein (the "Prospectus"), the form of Senior Debenture Indenture included as
an exhibit to the Registration Statement as revised and supplemented by the form
of Senior Debenture Indenture and form of Supplemental Indenture included as
exhibits to the Corporation's current Report on Form 8-K filed today with the
Commission (the "Indenture"), and the Prospectus Supplement filed today with the
Commission relating to the Debentures (the "Prospectus Supplement").
Securities and Exchange Commission
April 4, 1996
Page 2
Based on the foregoing, we are of the following opinions:
(1) The Indenture has been duly authorized by the Corporation and, when
duly executed and delivered by the parties thereto, will constitute a
valid and legally binding instrument of the Corporation;
(2) When the Debentures have been duly authorized, executed,
authenticated, issued, and delivered in accordance with the Indenture,
against payment therefor in accordance with the applicable underwriting
agreement, such Debentures will constitute valid and binding
obligations of the Corporation.
The opinions set forth hereinabove are subject to the following
limitations and qualifications:
(a) The enforceability of any obligation of the Corporation is
subject to applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium, and any similar laws
generally affecting creditors' rights and remedies and is also
subject to general principles of equity, including commercial
reasonableness, good faith, and fair dealing (regardless of
whether enforcement is sought at law or in equity).
(b) The Indenture contains a provision to the effect that the
acceptance by the Trustee or the holders of Debentures of a past
due installment by the Corporation shall not be deemed a waiver
of its or their right to accelerate. The North Carolina Court of
Appeals has held that, when a holder of an obligation regularly
accepts late payments, it is deemed to waive its right to
accelerate the debt because of late payments until it notifies
the maker of the obligation that prompt payments are again
required.
(c) North Carolina General Statute Section 6-21.2 sets forth
certain procedures and limitations applicable to the collection
of attorneys' fees, and our opinions are conditioned upon the
application of and compliance with those provisions.
(d) We express no opinion as to any provision of the Indenture
purporting to relieve the Trustee of the exercise of reasonable
diligence.
(e) We express no opinion (i) as to, and assume compliance with,
any applicable federal or state securities law or (ii) with
respect to the enforceability
Securities and Exchange Commission
April 4, 1996
Page 3
of any provision of the Indenture pursuant to which any party is
indemnified against a liability arising under applicable
securities laws.
(f) We express no opinion as to the effectiveness of any of the
provisions of the Indenture whereby the Company purports to
waive procedural, substantive or constitutional rights or
provisions.
(g) The opinions set forth herein are limited to the laws of the
State of North Carolina as applied by courts located in North
Carolina. Pursuant to its terms, the Indenture is governed by
the laws of the State of New York; for purposes of this opinion
we have assumed, without independent investigation, that the
laws of the State of New York governing the Indenture are the
same as those which would govern the Indenture if it were
governed by the law of the State of North Carolina,
notwithstanding the choice of law provisions therein.
We hereby consent to the use of this opinion as an exhibit to the Form
8-K referred to hereinabove and filed with the Commission as required by the Act
and to any reference to this opinion or to our firm under the heading "Legal
Opinions" in the Prospectus Supplement. We do not, however, thereby admit that
we are within the category of persons whose consent is required under Section 7
of the Act or the rules and regulations of the Commission promulgated
thereunder.
Very truly yours,
SCHELL BRAY AYCOCK ABEL & LIVINGSTON L.L.P.