assignee, custodian, trust

 STATEMENT OF STOCK DESIGNATION

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

              Setting  forth a copy of a  resolution  creating  and
              authorizing  the  issuance  of a series of  preferred
              stock designated as "Series B Convertible  Redeemable
              Accreting  Preferred  Stock"  adopted by the board of
              directors of General Communication, Inc.

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

          Pursuant to AS 10.06.315 and 10.06.320 of the Alaska Statutes

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

         We, the undersigned officers of General Communication,  Inc., an Alaska
corporation  ("Company"),  hereby state and otherwise certify that, on April 21,
1999, the board of directors of the Company,  pursuant to authority vested in it
by  Article  IV of the  Company's  Restated  Articles  of  Incorporation  and in
accordance with AS 10.06.315 and 10.06.318 of the Alaska Statutes,  duly adopted
the  following  resolution  creating a series of preferred  stock  designated as
"Series B Convertible Redeemable Accreting Preferred Stock":

                                   RESOLUTION

         "WHEREAS,  General  Communication,   Inc.  is  authorized  through  its
Restated  Articles of Incorporation to issue up to 100 million shares of Class A
Common Stock and up to 1 million shares of Preferred  Stock,  issuable from time
to time in one or more series;

         WHEREAS,  the Board of Directors of the Company is  authorized,  within
the  limitations  and  restrictions   contained  in  the  Restated  Articles  of
Incorporation,  to fix or alter  the  dividend  rate,  conversion  rate,  voting
rights,  redemption prices,  and liquidation  preferences of any wholly unissued
series of Preferred  Stock,  the number of shares  constituting any such series,
the  designation of such series,  and other terms and conditions of the issuance
of such stock;

                                                  Statement of Stock Designation
                                                                          Page 1

         WHEREAS,  the  Company,  through  its Board of  Directors,  approved  a
statement of stock  designation  pursuant to Article IV of the Restated Articles
of  Incorporation  and that  statement  was  filed  of  record  with the  Alaska
Department  of Commerce and Economic  Development  on or about  January 17, 1991
pursuant to authority set forth in AS 10.06.315, 10.06.318, and 10.06.320 of the
Alaska Statutes, and the board subsequently  authorized the issuance of Series A
Preferred Stock under that designation  which was subsequently  issued and later
retired,  and the Company does not presently have  outstanding any shares of its
Preferred  Stock and is not  otherwise  obligated  to issue  such  shares in the
future,  and the Board of Directors  desires to cancel and otherwise delete that
1991  statement  of stock  designation  at this  time and to fix the  terms of a
second series of that Preferred Stock and the number of shares constituting that
series;

         RESOLVED,  that,  pursuant  to  authority  granted to and vested in the
Board of Directors by Article IV of the Restated  Articles of  Incorporation  of
the Company,  and in accordance with AS 10.06.315,  10.06.318,  and 10.06.320 of
the Alaska  Statutes,  the board hereby  cancels and otherwise  deletes the 1991
statement  of stock  designation  for the  Series A  preferred  stock and hereby
declares that such statement is no longer a part of those articles;

         RESOLVED,  that,  pursuant  to  authority  granted to and vested in the
Board of Directors by Article IV of the Restated  Articles of  Incorporation  of
the Company and in  accordance  with AS  10.06.315  and  10.06.318 of the Alaska
Statutes,  the board hereby approves and otherwise directs the issuance,  from 1
million shares of Preferred Stock authorized  under those articles,  a series of
Preferred Stock of the Company to consist of 35,000 shares  designated as Series
B Convertible  Redeemable Accreting Preferred Stock ("Series B Preferred Stock")
and  hereby  fixes  the  designation,   rights,  preferences,   privileges,  and
restrictions  of the shares of that  series,  in  addition  to the  designation,
rights,  preferences,  privileges and  restrictions  set forth in those articles
which are directly applicable to the Preferred Stock as follows:

                  Preface.  Series B Convertible  Redeemable Accreting Preferred
Stock.  Of the  1,000,000  shares of  Preferred  Stock,  authorized  pursuant to
Article IV of the Restated  Articles of  Incorporation  of the  Company,  35,000
shall be designated Series B Convertible  Redeemable  Accreting Preferred Stock,
with the rights,  preferences,  privileges  and  restrictions  set forth in this
paragraph.

                  Section  1.   Definitions.   For  purposes  of  the  following
Sections, the following definitions shall apply:

                                                  Statement of Stock Designation
                                                                          Page 2

                           "Additional  Shares  of Class A Common  Stock"  shall
have the meaning ascribed to such term in Section 8(i)(d) hereof.

                           "Annualized  Operating  Cash Flow" shall mean,  as of
any date of determination,  the product of two times Operating Cash Flow for the
two most recently ended fiscal quarters.

                           "Bankruptcy  Event" shall mean the  occurrence of any
of  the  following:  (i) a  court  or  governmental  agency  having  appropriate
jurisdiction  shall enter a decree or order for relief in respect of the Company
in an  involuntary  case under any  applicable  bankruptcy,  insolvency or other
similar law now or hereafter in effect,  or  appointing a receiver,  liquidator,
assignee,  custodian, trustee, sequestrator (or similar official) of the Company
or for any  substantial  part of its  property  or  ordering  the  winding up or
liquidation of its affairs; (ii) there shall be commenced against the Company an
involuntary  case under any applicable  bankruptcy,  insolvency or other similar
law now or hereafter in effect, or any case,  proceeding or other action for the
appointment   of  a  receiver,   liquidator,   assignee,   custodian,   trustee,
sequestrator (or similar official) of the Company or for any substantial part of
its  property  or for the winding up or  liquidation  of its  affairs,  and such
involuntary  case or  other  case,  proceeding  or  other  action  shall  remain
undismissed,  undischarged  or unbonded  for a period of sixty (60)  consecutive
days;  (iii) the Company shall  commence a voluntary  case under any  applicable
bankruptcy,  insolvency  or other  similar law now or  hereafter  in effect,  or
consent  to the entry of an order for  relief in an  involuntary  case under any
such law,  or consent to the  appointment  or taking  possession  by a receiver,
liquidator,  assignee, custodian, trustee, sequestrator (or similar official) of
the  Company or for any  substantial  part of its  property  or make any general
assignment for the benefit of creditors; or (iv) the Company shall be unable to,
or shall admit in writing to its inability  to, pay its debts  generally as they
become due.

                           "Board"  shall  mean the  Board of  Directors  of the
Company.

                           "Business  Day" shall  mean a day on which  banks and
foreign  exchange  markets are open for the transaction of business in New York,
New York as relevant to the determination to be made or action to be taken.

                           "Capitalized  Leases"  shall mean capital  leases and
subleases, as defined in accordance with GAAP.

                           "Change of Control"  shall mean the occurrence of one
or more of the following events:  (a) any change in the ownership of the Company
resulting in MCI WorldCom, Inc. and any of its wholly owned Subsidiaries, owning
Voting Stock with less than eighteen  percent (18%) of the total combined voting
power of the Company,  (b) MCI WorldCom,  Inc.  shall at any time have less than
two (2)  representatives  sitting on the Board for more than a sixty-day period,
(c) Ronald A. Duncan resigns or is removed from his position as Chief  Executive

                                                  Statement of Stock Designation
                                                                          Page 3

Officer of the Company,  other than as a result of death or  disability,  and is
not replaced within sixty (60) days of such resignation or removal with a person
acceptable  to the holders of a majority of the  outstanding  Series B Preferred
Stock or (d)  Ronald  A.  Duncan  or his  heirs  transfers,  sells or in any way
disposes of a material  amount of the capital  stock of the Company owned by him
as of the date  hereof.  A Change of Control  shall be deemed to occur as of the
effective date of the first event,  action or transaction  leading to one of the
results described above.

                           "Class A Common  Stock" shall mean the Class A Common
Stock of the Company.

                           "Class B Common  Stock" shall mean the Class B Common
Stock of the Company.

                           "Closing Date" shall mean April 30, 1999.

                           "Closing Price" if the Class A Common Stock is traded
on a  nationally  recognized  exchange  or the  National  Market  System  of the
National Association of Security Dealers, Inc. Automated Quotation System, shall
mean the closing price as reported for composite  transactions on the applicable
date,  or, if no sales occurred on an applicable  date,  then the average of the
highest bid and lowest  asked  prices on such  exchange or the  National  Market
System at the end of the day on such  date.  If the Class A Common  Stock is not
traded on an exchange or the  National  Market  System but is  otherwise  traded
over-the-  counter,  Closing Price shall mean the average of the highest bid and
lowest asked prices quoted in the National Association of Security Dealers, Inc.
Automated  Quotation  System as of the close of business on the applicable date,
or if not so quoted on such  date,  the  average of the  representative  bid and
asked prices on such date in the domestic over-the-counter market as reported by
the National Quotation Bureau, Inc., or any similar successor organization.

                           "Common Stock" shall mean, collectively,  the Class A
Common Stock and Class B Common Stock of the Company.

                           "Company" shall mean this corporation.

                           "Contingent  Liability" shall mean, as to any person,
any obligation  contingent or otherwise,  of such person  guaranteeing or having
the economic effect of  guaranteeing  any Debt or obligation of any other person
in any manner, whether directly or indirectly,  including without limitation any
obligation  of such  person,  direct or  indirect,  (a) to  purchase  or pay (or
advance  or supply  funds for the  purchase  or payment  of) such  Debt,  (b) to
purchase property or services for the purpose of assuring the owner of such Debt
of its payment, or (c) to maintain the solvency,  working capital,  equity, cash
flow, fixed charge or other coverage ratio, or any other financial  condition of
the primary  obligor so as to enable the  primary  obligor 

                                                  Statement of Stock Designation
                                                                          Page 4

to pay any  Debt  or to  comply  with  any  agreement  relating  to any  Debt or
obligation, and shall, in any event, include any contingent obligation under any
letter  of  credit,  application  for any  letter  of  credit  or other  related
documentation.

                           "Conversion Price" shall have the meaning ascribed to
such term in Section 8(b) hereof.

                           "Convertible   Securities"  shall  have  the  meaning
ascribed to such term in Section 8(i)(c) hereof.

                           "Credit    Agreement"   shall   mean   that   certain
$200,000,000  Amended and  Restated  Credit  Agreement  dated  November 14, 1997
between GCI Holdings,  Inc. as borrower and NationsBank of Texas,  N.A.,  Credit
Lyonnais New York Branch and TD Securities (USA),  Inc., as it may be amended or
supplemented from time to time.

                           "Debt" shall mean,  all  obligations,  contingent  or
otherwise,  which in  accordance  with GAAP are required to be classified on the
balance sheet as  liabilities,  and in any event including  Capitalized  Leases,
Contingent Liabilities that are required to be disclosed and quantified in notes
to  consolidated  financial  statements in accordance with GAAP, and liabilities
secured  by any  Lien  on any  property,  regardless  of  whether  such  secured
liability is with or without recourse.

                           "Debt  for  Borrowed   Money"  shall  mean,   without
duplication,  (a) all  obligations  of a  person  for  borrowed  money,  (b) all
obligations of a person evidenced by bonds, debentures, notes, letters of credit
(or  applications for letters of credit) or other similar  instruments,  (c) all
obligations  of a person  to pay the  deferred  purchase  price of  property  or
services,  except  trade  accounts  payable  arising in the  ordinary  course of
business, and (d) all obligations of a person secured by a Lien on any assets or
property of any person.

                           "Distribution"  shall mean the declaration or payment
of any dividend (whether in cash or otherwise) on or in respect of any shares of
any class of capital stock of any person, other than dividends payable solely in
shares  of common  stock of such  person;  the  purchase,  redemption,  or other
retirement of any shares of any class of capital  stock of any person,  directly
or indirectly  through a subsidiary  or otherwise;  the return of capital by any
person to its  shareholders as such; or any other  distribution on or in respect
of any shares of any class of capital stock of any person.

                           "Effective  Price" shall have the meaning ascribed in
Section 8(i)(d) hereof.

                           "Equity Security" shall mean any capital stock of the
Company or any security  (whether stock or Debt for Borrowed Money)  convertible
or exchangeable,  with or without consideration,  into or for any capital stock,
or any security  (whether capital stock or Debt 

                                                  Statement of Stock Designation
                                                                          Page 5

for  Borrowed  Money)  carrying any warrant or right to subscribe to or purchase
any stock or similar security, or any such warrant or right.

                           "Exempt Issuances" shall have the meaning ascribed to
such term in Section 8(i)(a) hereof.

                           "Funded Debt" shall mean, without  duplication,  with
respect to any person,  all Debt of such person,  determined  on a  consolidated
basis and measured in accordance with GAAP that is either: (a) Debt for Borrowed
Money,  (b) Debt having a final  maturity  (or  extendable  at the option of the
obligor for a period  ending)  more than one (1) year after the date of creation
thereof, notwithstanding the fact that the payments are required to be made less
than one (1) year after such date, (c) Capitalized  Lease  obligations  (without
duplication),  (d)  reimbursement  obligations  relating  to  letters  of credit
(without  duplication),  (e)  Contingent  Liabilities  relating  to  any  of the
foregoing (without  duplication),  (f) Withdrawal  Liability,  (g) Debt, if any,
associated  with  interest  hedge   agreements,   (h)  payments  due  under  any
non-compete agreements, plus (i) payments due for the deferred purchase price of
property and services (but  excluding  trade  payables that are less than ninety
(90) days old and any thereof that are being contested in good faith).

                           "GAAP"  shall  mean,  as in effect from time to time,
generally accepted accounting principles used in the United States, consistently
applied.

                           "Initial  Issue  Date" shall mean the first date upon
which shares of Series B Preferred Stock are issued.

                           "Issue  Date"  shall  mean the  date of the  original
issuance of a share of the Series B Preferred Stock.

                           "Junior  Stock"  shall mean the Common  Stock and all
other shares of capital stock of the Company,  whether presently  outstanding or
hereafter issued, other than Series B Preferred Stock.

                           "Lien" shall mean any mortgage, lien, pledge, charge,
security  interest,  or other  encumbrance  of any kind,  whether  or not filed,
recorded or otherwise perfected under applicable law (including, any conditional
sale or other title  retention  agreement  and any lease deemed to  constitute a
security  interest  and any  option  or other  agreement  to give  any  security
interest).

                           "Liquidation  Preference"  shall have the meaning set
forth in Section 3(a) hereof.

                                                  Statement of Stock Designation
                                                                          Page 6

                           "Mandatory  Redemption  Date"  shall have the meaning
ascribed thereto in Section 4(c) hereof.

                           "Net   Total   Interest   Expense"   shall  have  the
definition ascribed thereto in the Credit Agreement.

                           "Operating  Cash Flow"  shall  mean,  for any period,
determined in accordance with GAAP, the  consolidated net income (loss) for such
period taken as a single accounting period,  excluding  extraordinary  gains and
losses,  plus the sum of the  following  amounts  for such  period to the extent
included in the determination of such consolidated net income:  (a) depreciation
expense,  (b)  amortization  expense and other non-cash charges reducing income,
(c) Net Total Interest Expense, (d) cash income tax expense, (e) deferred income
taxes,  plus (f) for the  fiscal  quarter  in which  the  Company  or any of its
Subsidiaries  purchases the  transponders  pursuant to that certain  Transponder
Purchase  Agreement for Galaxy X, dated August 24, 1995, among GCI Communication
Corp.,  an  indirect  wholly  owned  subsidiary  of  the  Company,   and  Hughes
Communications  Galaxy, Inc., now held by PanAmSat Corp., as assignee,  and that
certain  Transponder  Service  Agreement,  dated August 24, 1995,  among General
Communication  Corp.,  an indirect wholly owned  subsidiary of the Company,  and
Hughes  Communications  Satellite Services,  Inc. (the "Galaxy X Transponders"),
now held by  PanAmSat  Corp,  as  assignee,  the  annualized  amount of economic
savings of the  Company  or any of its  Subsidiaries  resulting  from the direct
purchase by the Company or any of its Subsidiaries of such Galaxy X Transponders
instead of leasing such Galaxy X  Transponders  from GCI Satellite Co., Inc., an
indirect wholly owned subsidiary of the Company,  and leasing  transponders from
other  providers;  provided,  the  calculation  is made after  giving  effect to
acquisitions   and  dispositions  of  assets  during  such  period  as  if  such
transactions  had  occurred  on the first  day of such  period.  In  calculating
"Operating Cash Flow," losses from local telephone businesses shall be offset by
amounts  not  exceeding  $20,000,000  contributed  to the  Company or any of its
Subsidiaries  from the net  proceeds  of any  offering of the Series B Preferred
Stock issued by the Company.  The amount attributable to such net proceeds which
is  available  for such  offset  shall be reduced by the amount of net  proceeds
actually used for such offset as of any point in time.

                           "Payment  Date"  shall  have  the  meaning   ascribed
thereto in Section 4(d) and Section 4(e) hereof.

                           "Proposed   Amendments"   shall  mean  the   proposed
amendments to Restated  Articles of  Incorporation of the Company which shall be
submitted by the Board to the  shareholders of the Company and voted upon by the
shareholders  at their next annual  meeting of  shareholders  as required by the
Purchase  Agreement.  The Proposed Amendments provide that so long as any shares
of Series B Preferred Stock remain outstanding,  the Company shall not, directly
or indirectly,  without the written  consent of the holders of a majority of the
then-outstanding  shares of Series B Preferred  Stock (i)  liquidate or dissolve
the  Company  or  (ii)  permit  the  Company  to be  merged  with  or  into,  or
consolidated  with,  any other  entity or sell all or  

                                                  Statement of Stock Designation
                                                                          Page 7

substantially  all of the  assets of the  Company in any case where the terms of
such merger,  consolidation or sale would significantly and adversely affect the
rights and preferences of the Series B Preferred Stock.

                           "Purchase   Agreement"   shall   mean  the  Series  B
Preferred Stock Purchase Agreement by and between the Company,  Toronto Dominion
Investments, Inc. and the other purchasers listed therein, dated as of April 30,
1999.

                           "Redemption  Price"  shall have the meaning  ascribed
thereto in Section 4(f) hereof.

                           "Series B  Preferred  Stock"  shall mean the Series B
Convertible Redeemable Accreting Preferred Stock of the Company.

                           "Subsidiary"   of  a  person   shall   mean  (i)  any
corporation of which fifty one (51%) percent or more of the Voting Stock, or any
partnership of which 51% or more of outstanding partnership interests, is at any
time owned by the person,  or by one or more  Subsidiaries of such person, or by
such  person and one or more  Subsidiaries  of such  person,  and (ii) any other
entity which is controlled  or capable of being  controlled by such person or by
one or more  Subsidiaries  of such  person  or by  such  person  and one or more
Subsidiaries of such person.

                           "Total  Debt"  shall mean the  outstanding  principal
amount of all Funded Debt.

                           "Total   Leverage   Ratio"   shall   mean,    without
duplication, as of any date of determination, the ratio of (i) Total Debt of the
Company (on an unconsolidated basis), its subsidiary,  GCI, Inc., its subsidiary
GCI Holdings,  Inc. and the Restricted  Subsidiaries  of GCI Holdings,  Inc. (as
defined  in the  Credit  Agreement)  on  such  date  of  determination,  to (ii)
Annualized   Operating  Cash  Flow  of  such  entities,   all  calculated  on  a
consolidated  basis (except as noted above) in accordance with GAAP consistently
applied.

                           "Trading Day" shall mean,  any date that a nationally
recognized exchange or the National Market System of the National Association of
Securities  Dealers,  Inc. Automated Quotation System is open and accepting bids
for the sale of securities listed thereon.

                           "Triggering Event" shall mean (i) the acceleration of
any  obligation  outstanding  under  Funded  Debt of the  Company  or any of its
Subsidiaries  having an  outstanding  balance  in excess of  $5,000,000,  (ii) a
Change of  Control,  (iii) a  Bankruptcy  Event,  (iv) the  breach of  Section 7
hereof, (v) the liquidation or dissolution of the Company, or (vi) the merger of
the Company  with or into,  or the  consolidation  of the Company with any other
entity or the sale by the Company of all or  substantially  all of the assets of
the  Company,  where  the  terms of 

                                                  Statement of Stock Designation
                                                                          Page 8

such merger,  consolidation or sale would significantly and adversely affect the
rights and preferences of the Series B Preferred Stock;  provided however,  that
clauses (v) and (vi) above shall cease to be Triggering Events upon the approval
by the  shareholders  of the Company of the Proposed  Amendments to the Restated
Articles of Incorporation  and the effective  filing of the Proposed  Amendments
with  the  Alaska  Department  of  Commerce  and  Economic  Development.  If the
shareholders  of the Company fail to approve the Proposed  Amendments or if such
amendments  are not filed with the Alaska  Department  of Commerce  and Economic
Development  by  August  31,  1999,  then  clauses  (v) and  (vi)  shall  remain
Triggering  Events for so long as any shares of Series B Preferred  Stock remain
outstanding.

                           "Voting  Stock" shall mean any shares having  general
voting power in electing the board of directors of any person  (irrespective  of
whether or not at the time stock of any other class or classes has or might have
voting power by reason or the happening of any contingency).

                           "Withdrawal  Liability"  shall have the meaning given
such term under  Part I of  Subtitle  E of Title IV of the  Employee  Retirement
Income Security Act of 1974, as amended.

                  Section 2.  Dividends.

                           (a) Right to  Dividends.  Dividends  on each share of
Series B  Preferred  Stock shall  accumulate  and accrue from the Issue Date and
shall  accrue  from day to day  thereafter,  compounding  semi-annually  (to the
extent unpaid),  whether or not earned or declared at a rate, through the fourth
anniversary  of the Initial Issue Date, of 8.5% per annum and,  after the fourth
anniversary  of the Initial Issue Date, of 17% per annum on the stated amount of
$1,000 per share until paid, subject to Section 4(j) hereof.  Dividends accruing
pursuant to this  Section  2(a) shall be payable  semi-annually  in arrears upon
declaration  by the Board and (i)  during the first  four  years  following  the
Initial Issue Date shall be payable, at the option of the Company, either by the
delivery of  additional  shares of Series B Preferred  Stock with a  liquidation
value equal to the amount of the  dividend  or by the  delivery of cash and (ii)
after the fourth  anniversary  of the  Initial  Issue Date shall be paid only in
cash.  If, during the first four years  following  the Initial  Issue Date,  the
Company does not make any dividend payment in full in cash to the holders of the
then-outstanding  shares of Series B Preferred Stock upon a semi-annual dividend
payment date,  the Company  shall be deemed to have declared and delivered  such
dividend in additional  shares of Series B Preferred  Stock, as set forth above.
Dividends  shall be cumulative so that, if all accrued  dividends shall not have
been paid,  such accrued and unpaid  dividends  shall first be fully paid before
any dividend or other  distribution  shall be paid or declared and set apart for
any Junior Stock.

                           (b)  Priority.  Until  such time as all  current  and
accrued dividends on the Series B Preferred Stock for all periods from and after
the Initial  Issue Date shall have been 

                                                  Statement of Stock Designation
                                                                          Page 9

paid (i) no dividend  whatsoever (other than a dividend payable solely in Common
Stock)  shall be paid or declared,  and no  Distribution  shall be made,  on any
Junior Stock, and (ii) no shares of Junior Stock shall be purchased, redeemed or
acquired by the  Company,  and no monies shall be paid into or set aside or made
available for a sinking fund for the purchase, redemption or acquisition thereof
other than shares of Junior Stock purchased, redeemed or acquired by the Company
to fund the Company's deferred compensation arrangements.  So long as any shares
of Series B Preferred  Stock are  outstanding,  the Company shall not issue,  or
obligate  itself to issue,  any other  Equity  Security  senior to the  Series B
Preferred Stock as to dividend or redemption  rights or liquidation  preferences
or, unless the consent of the holders of 80% of the outstanding shares of Series
B Preferred Stock is obtained, any other Equity Security on a parity with Series
B  Preferred   Stock  as  to  dividend  or  redemption   rights  or  liquidation
preferences.

                  Section 3.  Liquidation Rights of Series B Preferred Stock.

                           (a)  Preference.  In the  event  of any  liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary,  the
holders of the  then-outstanding  shares of Series B  Preferred  Stock  shall be
entitled to be paid out of the assets of the Company  available for distribution
to its  shareholders,  whether  such assets are  capital,  surplus or  earnings,
before any payment or  declaration  and setting  apart for payment of any amount
shall be made in  respect  of the  Junior  Stock,  an amount  (the  "Liquidation
Preference")  equal to $1,000 per share plus an amount  equal to all accrued and
unpaid dividends  thereon,  whether or not earned or declared,  to and including
the date full payment  shall be tendered to the holders of the  then-outstanding
shares of Series B Preferred Stock with respect to such liquidation, dissolution
or winding up, and no more. If upon any liquidation,  dissolution, or winding up
of the Company,  whether voluntary or involuntary,  the assets to be distributed
to the holders of the then-outstanding  shares of Series B Preferred Stock shall
be  insufficient  to  permit  the  payment  to  such  shareholders  of the  full
preferential  amounts to which they are entitled,  then all of the assets of the
Company  shall be  distributed  ratably to the  holders of the  then-outstanding
shares  of  Series B  Preferred  Stock on the  basis of the  number of shares of
Series B  Preferred  Stock  held by each such  shareholder  as  compared  to the
aggregate number of then-outstanding shares of Series B Preferred Stock. The (i)
merger or consolidation of the Company with or into any other entity or entities
where the Company is not the  surviving  entity  (other than a merger solely for
the purpose of changing the  Company's  state of  incorporation)  or in which in
excess of 50% of the Company's voting power is transferred,  or (ii) the sale or
transfer by the  Company of all or  substantially  all of its  assets,  shall be
deemed to be a liquidation, dissolution and winding up of the Company within the
meaning of this Section 3.

                           (b)   Remaining   Assets.   After  the   payment   or
distribution to the holders of the then-outstanding shares of Series B Preferred
Stock of the full preferential  amounts to which they are entitled,  the holders
of the  then-outstanding  shares of Junior  Stock  shall be  entitled to receive
ratably all remaining assets of the Company.

                                                  Statement of Stock Designation
                                                                         Page 10

                  Section 4.  Redemption.

                           (a) Restriction on Redemption and Purchase. Except as
expressly  provided in this  Section 4, the Company  shall not have the right to
purchase, call, redeem or otherwise acquire for value any or all of the Series B
Preferred Stock.

                           (b) Optional Redemption. At any time after the fourth
anniversary  of the Initial  Issue Date,  the Company  may, at its option,  upon
provision  of written  notice at least sixty (60) days prior to the date set for
redemption,  redeem the Series B Preferred  Stock,  in whole or in part,  at the
Redemption Price hereinafter specified;  provided, that the Company shall redeem
shares of Series B Preferred Stock having an aggregate Liquidation Preference of
at least Two  Million  Five  Hundred  Thousand  Dollars  ($2,500,000)  upon each
Payment Date; and provided  further,  any partial  redemption  shall be effected
ratably among the holders of Series B Preferred Stock on the basis of the number
of shares of Series B Preferred Stock then held by each holder.

                           (c)  Mandatory  Redemption.  The Company shall redeem
all  outstanding  shares of Series B  Preferred  Stock at the  Redemption  Price
hereinafter specified upon (i) the twelfth anniversary of the Initial Issue Date
or (ii) the  occurrence  of a  Triggering  Event  (in  either  case,  "Mandatory
Redemption Date").

                           (d) Optional  Redemption  Notice.  The Company shall,
not less  than  sixty  (60)  days  prior  to the  Payment  Date for an  optional
redemption  pursuant  to Section  4(b),  give  written  notice to each holder of
record of shares of Series B Preferred  Stock that the Company has determined to
exercise its optional  redemption rights hereunder.  This notice shall state the
number of  then-outstanding  shares of Series B Preferred  Stock to be redeemed,
the Redemption Price,  including the amount of dividends  included in such price
and the calculation  thereof, the Payment Date and the time, place and manner in
which the holder is to surrender to the Company the  certificate or certificates
representing  the shares of Series B Preferred  Stock to be  redeemed.  "Payment
Date," for purposes of this Section 4(d), shall mean the date set by the Company
with respect to an optional redemption  designated by the Company for payment of
the Redemption Price.

                           (e) Mandatory  Redemption  Notice.  The Company shall
provide  prompt,  but in no event  later  than two (2)  Business  Days after the
Mandatory Redemption Date, notice to the holders of the Series B Preferred Stock
of the Mandatory  Redemption Date. Such notice shall state the Redemption Price,
including  the amount of  dividends  included in such price and the  calculation
thereof,  and the  Payment  Date,  place and manner in which the  holders are to
surrender  to the  Company  the  certificates  representing  shares  of Series B
Preferred  Stock to be  redeemed.  "Payment  Date," for purposes of this Section
4(e),  shall  mean the date on or prior to the  fifth  Business  Day  after  the
Mandatory  Redemption  Date  designated  by  the  Company  for  payment  of  the
Redemption Price.

                                                  Statement of Stock Designation
                                                                         Page 11

                           (f) Redemption  Price. In all events,  the Redemption
Price of the Series B  Preferred  Stock  (the  "Redemption  Price")  shall be an
amount  per share  equal to $1,000  plus the  amount of all  accrued  and unpaid
dividends  thereon,  whether or not earned or  declared,  to and  including  the
Payment Date.

                           (g)  Payment of  Redemption  Price and  Surrender  of
Stock. On the Payment Date, the Redemption Price of the Series B Preferred Stock
shall be paid to the holders of the Series B Preferred  Stock.  On or before the
Payment Date,  each holder of shares of Series B Preferred  Stock to be redeemed
shall surrender the certificate or certificates  representing such shares to the
Company, duly endorsed,  together with such other instruments as the Company may
reasonably  require to insure that such  shares of Series B Preferred  Stock are
duly and  validly  transferred  to the  Company,  free of all Liens,  and on the
Payment Date the Redemption  Price for such shares shall be payable to the order
of the person  whose name appears on such  certificate  or  certificates  as the
owner thereof,  and each surrendered  certificate shall be canceled and retired.
Upon an optional redemption of less than all of the  then-outstanding  shares of
Series B Preferred Stock,  upon the surrender to the Company of a certificate or
certificates  representing shares of Series B Preferred Stock to be redeemed and
payment by the Company of the Redemption  Price,  the Company shall issue to the
holder thereof a certificate representing any shares of Series B Preferred Stock
not redeemed but represented by the certificate or certificates surrendered.

                           (h)  Insufficient  Funds. If the funds of the Company
legally available for redemption of Series B Preferred Stock on the Payment Date
with respect to a Mandatory  Redemption  Date are  insufficient to redeem all of
the Series B Preferred Stock that are subject to redemption  pursuant to Section
4(c) on such date,  those funds that are so available will be used to redeem the
maximum  possible  number of such shares of the Series B Preferred Stock ratably
among  the  holders  thereof  on the  basis of the  number of shares of Series B
Preferred Stock held by each such  shareholder.  At the earliest time thereafter
as  additional  funds of the Company are legally  available  for  redemption  of
Series B  Preferred  Stock in the  manner  provided  above,  such  funds will be
immediately  used to redeem the balance of such Series B Preferred Stock subject
to redemption.

                           (i)  Deposit of Funds.  At least  three (3)  Business
Days prior to a Payment  Date,  the Company shall deposit with any bank or trust
company  in the  United  States,  having a capital  and  surplus  of at least $1
billion as a trust fund, a sum equal to the  aggregate  Redemption  Price,  with
irrevocable  instructions  and authority to the bank or trust company to pay, on
or after the Payment Date,  the Redemption  Price to the  respective  holders of
then-outstanding  shares of Series B Preferred Stock upon the surrender of their
share  certificates.  The deposit shall constitute full payment of the shares to
their holders;  provided, that, until all shares of Series B Preferred Stock are
redeemed and full payment made therefor,  the holders  thereof shall continue to
be considered shareholders with respect to such shares and shall have all rights
with  respect  thereto,  including  the right to receive  from the bank or trust
company payment of the Redemption Price of the shares,  without  interest,  upon
surrender of their certificates  therefor. 

                                                  Statement of Stock Designation
                                                                         Page 12

Any monies so  deposited  and  unclaimed at the end of one year from the Payment
Date shall be  released  or repaid to the  Company,  after  which the holders of
shares of Series B Preferred  Stock called for  redemption  shall be entitled to
receive payment of the Redemption Price only from the Company.

                           (j) Accrual of Dividends. Unless the Company defaults
in making the payment of the  Redemption  Price in accordance  with Section 4(i)
hereof,  dividends on Series B Preferred  Stock subject to redemption will cease
to accrue on and after the Payment Date.

                           (k)  Waiver.  At any time after  receiving  notice of
Mandatory Redemption and prior to two Business Days before the Payment Date, the
holders of Series B  Preferred  Stock may,  by written  consent of holders of at
least 80% of the then outstanding Series B Preferred Stock, waive the redemption
of the Series B Preferred Stock as to such mandatory  redemption  event in which
case the  Company  shall  not be  obligated  to  redeem  the  shares of Series B
Preferred  Stock as to such redemption  event.  Upon receipt of any such waiver,
the Company shall  promptly  provide  written  notice to all holders of Series B
Preferred Stock.

                  Section 5.  Voting Rights.

                           (a) Series B Preferred  Stock.  Each holder of shares
of Series B Preferred  Stock shall be entitled to vote on all matters  submitted
to a vote of the  holders  of Class A Common  Stock  and,  except  as  otherwise
expressly provided herein, shall be entitled to the number of votes equal to the
largest  number of full shares of Class A Common Stock into which such shares of
Series B Preferred  Stock could be  converted,  pursuant  to the  provisions  of
Section  8(b)  hereof,   at  the  record  date  for  the  determination  of  the
shareholders  entitled  to vote on such  matters  or, if no such  record date is
established, at the date such vote is taken.

                           (b) Common  Stock.  Each  holder of shares of Class A
Common Stock shall be entitled to one vote for each share thereof held, and each
holder of shares of Class B Common Stock shall be entitled to ten votes for each
share  thereof  held,  as provided in Article  IV,  Section (b) of the  Restated
Articles of Incorporation.  Except as otherwise  expressly provided herein or as
required  by law,  the  holders of Series B  Preferred  Stock and the holders of
Common Stock shall vote together and not as separate classes.

                  Section 6. Restrictions and Limitations. So long as any shares
of Series B Preferred Stock remain outstanding,  the Company shall not, directly
or indirectly, without the written consent of the holders of 80% with respect to
items (c), (e) or (g), or a majority with respect to items (a), (b), (d) or (f),
of the then-outstanding shares of Series B Preferred Stock:

                           (a) Purchase,  redeem or otherwise  acquire for value
(or pay into or set aside as a sinking  fund for such  purpose) any Junior Stock
or any  warrant,  option or right to  

                                                  Statement of Stock Designation
                                                                         Page 13

purchase any Junior  Stock,  other than  purchases of shares of Junior Stock for
the purpose of funding deferred compensation arrangements;

                           (b)  Declare  or pay any  dividends  on or declare or
make any other  Distribution,  direct or indirect (other than a dividend payable
solely in shares of Class A Common  Stock),  on account  of Junior  Stock or set
apart any sum for any such purpose;

                           (c) Amend its Articles of Incorporation in any manner
that would  significantly  and adversely affect the rights or preferences of the
Series B Preferred Stock;

                           (d) Take any action which would result in taxation of
the holders of the Series B Preferred  Stock under  Section 305 of the  Internal
Revenue Code of 1986,  as amended (the "Code") (or any  comparable  provision of
the Code as hereafter from time to time amended);

                           (e) Issue any additional shares of Series B Preferred
Stock after the Initial Issue Date, except pursuant to Section 2 hereof;

                           (f)  Following  the  effective  date of the  Proposed
Amendments, liquidate or dissolve the Company; or

                           (g)  Following  the  effective  date of the  Proposed
Amendments,  permit the Company to be merged with or into, or consolidated  with
any other entity or sell all or  substantially  all of the assets of the Company
in any  case  where  the  terms  of such  merger,  consolidation  or sale  would
significantly  and adversely  affect the rights and  preferences of the Series B
Preferred Stock.

                  Section  7. Debt  Incurrence  Covenant.  At all times that any
shares of Series B Preferred Stock are outstanding,  the Company shall not incur
any Funded Debt if, as a result of such  additional  Funded Debt,  the Company's
Total Leverage Ratio would exceed 7.0:1.

                  Section 8. Conversion. The holders of Series B Preferred Stock
shall have the following conversion rights:

                           (a)  Right  to  Convert.   Each  share  of  Series  B
Preferred  Stock shall be  convertible,  at any time at the option of the holder
thereof,  into fully paid and nonassessable shares of Class A Common Stock. Such
conversion  right  shall  continue  to apply to any share of Series B  Preferred
Stock  called for  redemption  pursuant  to Section 4 hereof  until the close of
business on the Business Day immediately preceding the applicable Payment Date.

                           (b)  Conversion   Price.   Each  share  of  Series  B
Preferred  Stock shall  initially be  convertible  into that number of shares of
Class A Common Stock determined by dividing the then  Liquidation  Preference of
such share of Series B Preferred Stock by the then 

                                                  Statement of Stock Designation
                                                                         Page 14

conversion price, as adjusted pursuant to this Section 8, which conversion price
shall initially be equal to $5.55 per share (the "Conversion Price").

                           (c) Mechanics of Conversion.  Each holder of Series B
Preferred  Stock who  desires to convert  the same into shares of Class A Common
Stock shall surrender the certificate or certificates  therefor,  duly endorsed,
at the office of the Company or of any transfer agent for the Series B Preferred
Stock or Class A Common Stock,  and shall give written  notice to the Company at
such office that such holder  elects to convert the same and shall state therein
the number of shares of Series B Preferred Stock being converted.  Thereupon the
Company  shall  promptly  issue and  deliver  to such  holder a  certificate  or
certificates  for the  number of shares  of Class A Common  Stock to which  such
holder  is  entitled.  Such  conversion  shall  be  deemed  to  have  been  made
immediately  prior to the close of business on the date of such surrender of the
certificate representing the shares of Series B Preferred Stock to be converted,
and the person  entitled to receive the shares of Class A Common Stock  issuable
upon such  conversion  shall be treated for all purposes as the record holder of
such shares of Class A Common Stock on such date.

                           (d) Adjustment for Stock Splits and Combinations.  If
the  Company  at any time or from time to time  after  the  Initial  Issue  Date
effects a subdivision of the  outstanding  Class A Common Stock,  the Conversion
Price   then  in  effect   immediately   before   that   subdivision   shall  be
proportionately  decreased,  and, conversely, if the Company at any time or from
time to time after the Initial  Issue Date  combines the  outstanding  shares of
Class A Common Stock into a smaller number of shares,  the Conversion Price then
in  effect   immediately   before  that  combination  shall  be  proportionately
increased.  Any adjustment  under this subsection (d) shall become  effective at
the  open of  business  on the  date  the  subdivision  or  combination  becomes
effective.

                           (e)    Adjustment    for   Certain    Dividends   and
Distributions. If the Company at any time or from time to time after the Initial
Issue Date  makes,  or fixes a record date for the  determination  of holders of
Class A Common  Stock  entitled  to receive,  a dividend  or other  Distribution
payable  in  additional  shares of Class A Common  Stock,  then and in each such
event the Conversion  Price then in effect shall be reset as of the time of such
issuance or, in the event such record date is fixed,  as of the open of business
on such record date, by  multiplying  the  Conversion  Price then in effect by a
fraction  (1) the  numerator  of which is the total  number of shares of Class A
Common  Stock  issued  and  outstanding  immediately  prior  to the time of such
issuance or the close of business on such record date,  and (2) the  denominator
of which shall be the total  number of shares of Class A Common Stock issued and
outstanding  immediately  prior to the  time of such  issuance  or the  close of
business on such  record date plus the number of shares of Class A Common  Stock
issuable in payment of such dividend or Distribution; provided, however, that if
such  record  date is  fixed  and such  dividend  is not  fully  paid or if such
Distribution is not fully made on the date fixed therefor,  the Conversion Price
shall be recomputed  accordingly as of the close of business on such record date
and  thereafter  

                                                  Statement of Stock Designation
                                                                         Page 15

the Conversion Price shall be adjusted pursuant to this subsection (e) as of the
time of actual payment of such dividends or Distributions.

                           (f)    Adjustments    for   Other    Dividends    and
Distributions.  In the event the  Company at any time or from time to time after
the Initial Issue Date makes, or fixes, a record date for the  determination  of
holders  of Class A Common  Stock  entitled  to  receive,  a  dividend  or other
Distribution  payable in  securities  of the Company other than shares of Common
Stock,  then and in each such event  provision shall be made so that the holders
of Series B Preferred Stock shall receive upon conversion  thereof,  in addition
to the  number of shares of Common  Stock  receivable  thereupon,  the amount of
securities  of the Company  which they would have  received  had their  Series B
Preferred  Stock been  converted  into Class A Common  Stock on the date of such
event and had they thereafter,  during the period from the date of such event to
and including the conversion date,  retained such securities  receivable by them
as aforesaid  during such period,  subject to all other  adjustments  called for
during  such  period  under  this  Section 8 with  respect  to the rights of the
holders of the Series B Preferred Stock.

                           (g)  Adjustment  for  Reclassification,  Exchange and
Substitution.  In the  event  that at any time or from  time to time  after  the
Initial Issue Date, the Class A Common Stock issuable upon the conversion of the
Series B  Preferred  Stock is  changed  into the same or a  different  number of
shares  of  any  class  or  classes  of  stock,   whether  by  recapitalization,
reclassification or otherwise (other than a subdivision or combination of shares
or stock dividend or a reorganization,  merger, consolidation or sale of assets,
provided  for  elsewhere  in this  Section  8),  then and in any such event each
holder of Series B Preferred  Stock shall have the right  thereafter  to convert
such stock into the kind and amount of stock and other  securities  and property
receivable  upon such  recapitalization,  reclassification  or other change,  by
holders of the maximum  number of shares of Class A Common Stock into which such
shares of Series B Preferred Stock could have been converted  immediately  prior
to such  recapitalization,  reclassification  or change,  all subject to further
adjustment as provided herein.

                           (h) Reorganizations, Mergers, Consolidations or Sales
of  Assets.  If at any time or from time to time  after the  Initial  Issue Date
there is a capital  reorganization  of the Class A Common  Stock  (other  than a
recapitalization,  subdivision,  combination,  reclassification  or  exchange of
shares provided for elsewhere in this Section 8) or a merger or consolidation of
the  Company  with  or  into  another  corporation,   or  the  sale  of  all  or
substantially  all of the Company's  properties  and assets to any other person,
then, as a part of such reorganization, merger, consolidation or sale, provision
shall  be made so that  the  holders  of the  Series  B  Preferred  Stock  shall
thereafter  be entitled  to receive  upon  conversion  of the Series B Preferred
Stock the number of shares of stock or other  securities  or property to which a
holder  of the  number  of  shares  of Class A  Common  Stock  deliverable  upon
conversion  would have been  entitled on such  capital  reorganization,  merger,
consolidation,  or sale. In any such case,  appropriate adjustment shall be made
in the  application  of the  provisions  of this  Section 8 with  respect to the
rights of the holders of the Series B Preferred Stock after the  reorganization,

                                                  Statement of Stock Designation
                                                                         Page 16

merger,  consolidation  or sale to the end that the provisions of this Section 8
(including  adjustment of the Conversion  Price then in effect and the number of
shares  purchasable  upon  conversion of the Series B Preferred  Stock) shall be
applicable after that event and be as nearly equivalent as may be practicable.

                           (i) Sale of Shares Below Conversion Price.

                                    a) If at any time or from time to time after
the Initial Issue Date, the Company issues or sells, or is deemed by the express
provisions of this subsection (i) to have issued or sold,  Additional  Shares of
Class A Common Stock (as  hereinafter  defined) (other than (A) as a dividend or
other  Distribution  on any class of stock as provided in subsection  (e) above,
(B) upon a  subdivision  or  combination  of shares  of Class A Common  Stock as
provided  in  subsection  (d)  above,  or (C)  shares to be issued to  officers,
directors,  employees,  agents or consultants  of the Company  pursuant to stock
options or equity  incentive  plans  approved by the Board of  Directors  of the
Company  and  representing  not more than 5% of the  outstanding  Class A Common
Stock as of the Initial  Issue Date (the "Exempt  Issuances"))  for an Effective
Price (as  hereinafter  defined) less than the then existing  Conversion  Price,
then and in each such case the then existing  Conversion Price shall be reduced,
as of the opening of business on the date of such issue or sale, by  multiplying
such  Conversion  Price in effect  immediately  prior to such new  issuance by a
fraction (i) the numerator of which shall be (A) the number of shares of Class A
Common Stock  outstanding at the close of business on the day preceding the date
of such issue or sale (assuming conversion of all outstanding shares of Series B
Preferred Stock at the then  Conversion  Price) plus (B) the number of Shares of
Class A Common  Stock  which the  aggregate  consideration  received  (or by the
express  provisions  hereof  deemed to have been received by the Company for the
total  number of  Additional  Shares of Class A Common  Stock so  issued)  would
purchase at such  Conversion  Price,  and (ii) the denominator of which shall be
the  number  of  shares  of Class A Common  Stock  outstanding  at the  close of
business on the date of such  issuance or sale after giving effect to such issue
of  Additional  Shares  of  Class A Common  Stock  (assuming  conversion  of all
outstanding shares of Preferred Stock into shares of Class A Common Stock at the
then Conversion Price).

                                    b) For the purpose of making any  adjustment
required under this  subsection (i), the  consideration  received by the Company
for any issue or sale of securities  shall (A) to the extent it consists of cash
be computed at the amount of cash received by the Company,  (B) to the extent it
consists  of  property  other than cash,  be  computed at the fair value of that
property as determined in good faith by the Board,  (C) if Additional  Shares of
Class A Common Stock,  Convertible Securities (as hereinafter defined) or rights
or options  to  purchase  either  Additional  Shares of Class A Common  Stock or
Convertible  Securities  are  issued  or  sold  together  with  other  stock  or
securities or other assets of the Company for a consideration which covers both,
be  computed  as the  portion  of the  consideration  so  received  that  may be
reasonably  determined  in good  faith  by the  Board  to be  allocable  to such
Additional Shares of Class A 

                                                  Statement of Stock Designation
                                                                         Page 17

Common Stock,  Convertible  Securities or rights or options, and (D) be computed
after reduction for all expenses  payable by the Company in connection with such
issue or sale.

                                    c)  For  the   purpose  of  the   adjustment
required under this subsection (i), if the Company issues or sells any rights or
options for the purchase of, or stock or other  securities  convertible  into or
exchangeable for, Additional Shares of Class A Common Stock (such convertible or
exchangeable  stock or securities being hereinafter  referred to as "Convertible
Securities")  or rights or options for the purchase of  Convertible  Securities,
and if the  Effective  Price of such  Additional  Shares of Class A Common Stock
ultimately  issuable  pursuant  thereto is less than the then Conversion  Price,
then in each case the Company  shall be deemed to have issued at the time of the
issuance of such rights or options or Convertible  Securities the maximum number
of Additional Shares of Class A Common Stock issuable upon exercise,  conversion
or exchange  thereof and to have received as  consideration  for the issuance of
such shares an amount  equal to the total amount of the  consideration,  if any,
received  by the  Company  for  the  issuance  of  such  rights  or  options  or
Convertible Securities, plus, in the case of such rights or options, the minimum
amounts of  consideration,  if any,  payable to the Company upon the exercise of
such rights or options, plus, in the case of Convertible Securities, the minimum
amounts  of  consideration,  if  any,  payable  to the  Company  (other  than by
cancellation  of  liabilities  or  obligations  evidenced  by  such  Convertible
Securities) upon the conversion or exchange  thereof.  No further  adjustment of
the  Conversion  Price,  adjusted  upon the issuance of such rights,  options or
Convertible  Securities,  shall be made as a result of the  actual  issuance  of
Additional  Shares of Class A Common Stock on the exercise of any such rights or
options or the conversion or exchange of any such Convertible Securities. If any
such rights or options or the  conversion or exchange  privilege  represented by
any such Convertible Securities shall expire without having been exercised,  the
Conversion  Price  adjusted  upon  the  issuance  of  such  rights,  options  or
Convertible  Securities  shall be readjusted to the Conversion Price which would
have  been in effect  had an  adjustment  been  made on the basis  that the only
Additional  Shares of Class A Common Stock so issued were the Additional  Shares
of Class A Common Stock, if any, actually issued or sold on the exercise of such
rights or  options  or rights of  conversion  or  exchange  of such  Convertible
Securities,  and such  Additional  Shares of Class A Common Stock,  if any, were
issued or sold for the consideration  actually received by the Company upon such
exercise,  plus the consideration,  if any, actually received by the Company for
the granting of all such rights or options,  whether or not exercised,  plus the
consideration  received  for  issuing  or  selling  the  Convertible  Securities
actually  converted  or  exchanged,  plus the  consideration,  if any,  actually
received  by  the  Company  (other  than  by   cancellation  of  liabilities  or
obligations  evidenced by such  Convertible  Securities)  on the  conversion  or
exchange of such Convertible Securities.  A similar readjustment will be made if
the amount  actually  paid to the Company  upon  exercise of  conversion  of any
Convertible  Securities  exceeds the  minimum  amount  assumed  pursuant to this
Section 8(i).

                                    d)  "Additional  Shares  of  Class A  Common
Stock" shall mean all shares of Class A Common Stock issued by the Company after
the Series B Issuance Date, 

                                                  Statement of Stock Designation
                                                                         Page 18

whether or not subsequently reacquired or retired by the Company, other than (i)
shares of Class A Common Stock issued upon  conversion of the Series B Preferred
Stock and (ii) the shares of Class A Common  Stock  issued as Exempt  Issuances.
The  "Effective  Price" of Additional  Shares of Class A Common Stock shall mean
the quotient  determined  by dividing the total number of  Additional  Shares of
Class A Common  Stock  issued or sold,  or deemed to have been issued or sold by
the  Company  under  this  subsection  (i),  into  the  aggregate  consideration
received,  or deemed to have been received,  by the Company for such issue under
this subsection (i), for such Additional Shares of Class A Common Stock.

                           (j) Accountants'  Certificate of Adjustment.  In each
case of an adjustment or readjustment of the Conversion  Price, the Company,  at
its expense,  shall cause independent public accountants of recognized  standing
selected by the Company  (who may be the  independent  public  accountants  then
auditing the books of the Company) to compute such adjustment or readjustment in
accordance  with the  provisions  hereof and prepare a certificate  showing such
adjustment  or  readjustment,  and shall mail such  certificate,  by first class
mail, postage prepaid, to each registered holder of the Series B Preferred Stock
at the holder's address as shown in the Company's  books. The certificate  shall
set forth  such  adjustment  or  readjustment,  showing in detail the facts upon
which such adjustment or readjustment is based, including a statement of (1) the
consideration  received  or  deemed  to be  received  by  the  Company  for  any
Additional  Shares of Class A Common Stock issued or sold or deemed to have been
issued or sold, (2) the Conversion  Price at the time in effect,  (3) the number
of  Additional  Shares of Class A Common  Stock and (4) the type and amount,  if
any, of other  property  which at the time would be received upon  conversion of
the Series B Preferred Stock.

                           (k) Notices of Record  Date.  In the event of (i) any
taking by the Company of a record of the holders of any class of securities  for
the purpose of determining  the holders  thereof who are entitled to receive any
dividend  or other  Distribution,  or (ii)  any  capital  reorganization  of the
Company,  any  reclassification  or recapitalization of the capital stock of the
Company,  any  merger or  consolidation  of the  Company  with or into any other
corporation,  or any transfer of all or  substantially  all of the assets of the
Company  to any  other  person  or any  voluntary  or  involuntary  dissolution,
liquidation or winding up of the Company,  the Company shall mail to each holder
of Series B  Preferred  Stock at least ten (10) days  prior to the  record  date
specified  therein, a notice specifying (1) the date on which any such record is
to be taken for the purpose of such dividend or  Distribution  and a description
of such dividend or Distribution, (2) the date on which any such reorganization,
reclassification,  transfer, consolidation,  merger, dissolution, liquidation or
winding up is expected to become effective, and (3) the date, if any, that is to
be fixed,  as to when the  holders  of record of Class A Common  Stock (or other
securities)  shall be entitled to exchange  their shares of Class A Common Stock
(or other  securities)  for securities or other property  deliverable  upon such
reorganization,  reclassification, transfer, consolidation, merger, dissolution,
liquidation or winding up.

                                                  Statement of Stock Designation
                                                                         Page 19

                           (l) Mandatory  Conversion.  At any time following the
third  anniversary  of the  Initial  Issue  Date,  the  Company  may require the
immediate  conversion of all outstanding shares of Series B Preferred Stock into
shares of Class A Common  Stock  pursuant  to the  procedures  set forth in this
Section 8 by written  notice to all holders of Series B  Preferred  Stock at the
then  effective  Conversion  Price;  provided  however,  the Company may require
conversion  pursuant to this  Section  8(l) only if the shares of Class A Common
Stock are traded on a  nationally  recognized  exchange or the  National  Market
System of the National Association of Security Dealers, Inc. Automated Quotation
System and such  shares then have a Closing  Price equal to or greater  than two
times the then effective  Conversion Price and have had such a Closing Price for
a period of thirty consecutive Trading Days.

                           (m)  Conversion   Following  Default  in  Payment  of
Redemption Price.  Notwithstanding anything herein to the contrary, in the event
that the  Company  fails to make full  payment  of the  Redemption  Price on any
Payment  Date  pursuant  to  Section 4 hereof,  for any  reason,  including  the
prohibition  of such payment  pursuant to the Credit  Agreement,  the holders of
shares of Series B Preferred Stock remaining outstanding shall have the right to
convert such shares of Series B Preferred  Stock, in whole or in part,  pursuant
to the  procedures  set forth in this  Section 8, into  shares of Class A Common
Stock at a Conversion  Price equal to  ninety-five  percent (95%) of the average
Closing  Price of the  Company's  Class A Common  Stock for the ten (10) Trading
Days  immediately  prior to the  date of  conversion.  Any  shares  of  Series B
Preferred Stock not so converted shall remain  outstanding and shall continue to
represent an obligation of the Company to pay the Redemption  Price with respect
thereto.  Notwithstanding  anything herein to the contrary, the aggregate number
of shares of Class A Common Stock issued upon  conversion  of shares of Series B
Preferred  Stock pursuant to this Section 8(m) shall,  in any event,  not exceed
19.9% of the total number of issued and  outstanding  shares of capital stock of
the Company as of the Initial Issue Date.

                  Section 10.  Exclusive  Remedy.  So long as any  obligation is
outstanding under the Credit Agreement,  the sole remedy available to holders of
Series B Preferred Stock for the Company's  failure to make full payment in cash
of the Redemption Price when required pursuant to Section 4 hereof, shall be the
conversion  of the Series B Preferred  Stock into shares of Class A Common Stock
pursuant to Section 8(m) hereof  unless the lenders  under the Credit  Agreement
consent to payment in cash.

                  Section  11. No  Reissuance  of Series B Preferred  Stock.  No
share of Series B Preferred  Stock acquired by the Company upon  conversion,  by
reason of redemption,  purchase,  or otherwise  shall be reissued,  and all such
shares  shall be  canceled,  retired and  eliminated  from the shares  which the
Company shall be authorized to issue.

         RESOLVED FURTHER,  that, because certain of the terms and conditions of
the  issuance of the Series B Preferred  Stock  relating to rights of holders of
that stock to vote

                                                  Statement of Stock Designation
                                                                         Page 20

as a class on certain specific  activities of the Company,  as further described
in Sections 1-11 above,  will not become  effective until certain  amendments to
the Company's Restated Articles of Incorporation become effective,  the Board of
Directors  shall  seek  approval  of  amendments  to  those  articles  from  the
shareholders of the Company at the annual  shareholder  meeting to be held on or
about  June 10,  1999 or such  other  date on which it is held,  and such  terms
relating to those class votes will not become  effective  until that  portion of
those amendments are approved by those shareholders and the amendments are filed
with the Alaska Department of Commerce and Economic Development;

         RESOLVED  FURTHER,  that  the  president  of the  Company  or any  vice
president  designated  by him and the  secretary of the Company or any assistant
secretary of the Company are hereby  authorized and directed to take those steps
necessary  to cause  the  issuance  and sale of the  Series  B  Preferred  Stock
including to execute a statement to be filed in accordance with the requirements
of AS 10.06.320 of the Alaska Statutes and to seek shareholder approval of those
amendments to the Company's  Restated  Articles of Incorporation to allow all of
the terms of ownership of the Series B Preferred Stock to become effective."

         IN WITNESS  WHEREOF,  the Company has caused  this  Statement  of Stock
Designation  to be duly executed on its behalf at  Anchorage,  Alaska as of this
21st day of April, 1999.

                                       GENERAL COMMUNICATION, INC.

                                       By:  /s/
                                            G. Wilson Hughes
                                       Its: Executive Vice President

                                       By:  /s/
                                            John M. Lowber
                                       Its: Secretary

                                                  Statement of Stock Designation
                                                                         Page 21 

Basic Info X:

Name: assignee, custodian, trust
Type: trust
Date: May 17, 1999
Company: GENERAL COMMUNICATION INC
State: Alaska

Other info:

Date:

  • April 21 , 1999
  • January 17 , 1991
  • November 14 , 1997
  • fiscal quarter
  • August 24 , 1995
  • April 30 , 1999
  • August 31 , 1999
  • June 10 , 1999
  • 21st day of April , 1999

Organization:

  • General Communication , Inc.
  • B Convertible Redeemable Accreting Preferred Stock
  • Board of Directors of the Company
  • MCI WorldCom , Inc.
  • National Quotation Bureau , Inc.
  • Restated Credit Agreement
  • Credit Lyonnais New York Branch
  • TD Securities USA , Inc.
  • GCI Communication Corp.
  • Hughes Communications Galaxy , Inc.
  • General Communication Corp.
  • Hughes Communications Satellite Services , Inc.
  • GCI Satellite Co.
  • Toronto Dominion Investments , Inc.
  • Convertible Redeemable Accreting Preferred Stock of the Company
  • GCI , Inc.
  • GCI Holdings , Inc.
  • National Market System of the National Association of Securities Dealers , Inc
  • Change of Control
  • Restriction on Redemption and Purchase
  • Two Million Five Hundred Thousand Dollars
  • Optional Redemption Notice
  • e Mandatory Redemption Notice
  • g Payment of Redemption Price and Surrender of Stock
  • Mandatory Redemption Date
  • Deposit of Funds
  • Company's Total Leverage Ratio
  • b Conversion Price
  • c Mechanics of Conversion
  • Sale of Shares Below Conversion Price
  • k Notices of Record Date
  • National Market System of the National Association of Security Dealers , Inc
  • Conversion Following Default in Payment of Redemption Price
  • Alaska Department of Commerce and Economic Development

Location:

  • Alaska Statutes
  • New York
  • Texas
  • N.A.
  • United States
  • Anchorage

Money:

  • $ 200,000,000
  • $ 20,000,000
  • $ 5,000,000
  • $ 2,500,000
  • $ 1,000
  • $ 1 billion
  • $ 5.55

Person:

  • Ronald A. Duncan
  • s G. Wilson Hughes
  • John M. Lowber

Percent:

  • eighteen percent 18 %
  • 51 % percent
  • 8.5 %
  • 17 %
  • 50 %
  • 80 %
  • ninety-five percent
  • 95 %
  • 19.9 %