AMENDMENTTO DEFERREDCOMPENSATION AGREEMENT WITH RONALDA. DUNCAN

This Amendment to the Deferred Compensation Agreement is made this 31st day of December, 2008, by and among General Communication, Inc. (“GCI”), GCI Communication Corp. (the “Employer”) and Ronald A. Duncan (“Duncan”).

WHEREAS, GCI and Duncan entered into a Deferred Compensation Agreement (the “Agreement”) on August 13, 1993;

WHEREAS, the Employer assumed the obligations of GCI under the Agreement in 1997;

WHEREAS, pursuant to the Agreement, Duncan’s deferred compensation account under the Agreement was credited with certain specified amounts for each year from 1993 through 1997, totaling $625,000;

WHEREAS, GCI and Duncan agreed that earnings on the amount credited to Duncan’s deferred compensation account under the Agreement would be credited as if the deferred compensation account was invested entirely in Class A common stock of GCI;

WHEREAS, the parties desire to (a) amend the Agreement to comply with Section 409A of the Internal Revenue Code of 1986, as amended and the final regulations issued thereunder (“Section 409A”); and (b) take advantage of the transition rules provided under Section 409A to make a payment in full of all amounts credited to Duncan under the Agreement on February 8, 2009;

NOW THEREFORE, the parties agree as follows:

1.           Notwithstanding any other provision of the Agreement, Duncan’s entire deferred compensation account under the Agreement, including any earnings credited to the deferred compensation account, shall be paid to Duncan, in one lump sum cash payment, less required withholdings, on February 8, 2009;

2.           For purposes of determining the value of the deferred compensation account as of the February 8, 2009, payment date, Duncan has the right, effective from the date this Amendment is signed through and including February 7, 2009, to elect to have the earnings on the deferred compensation account determined as if the Class A common stock of GCI, upon which earnings on the deferred compensation account currently are being based, was sold at the market value of such shares as reported on the Nasdaq (disregarding any commissions or transaction fees) as of the date and time of such election (which may not be retroactive).  This election shall be communicated by

 

 

Duncan in writing (and an e-mail may suffice for such writing) to John Lowber indicating the prospective date and time of such “sale.”  Such election, once made, shall be irrevocable.  Once the value of the deferred compensation account is determined as provided in this paragraph 3, such deferred compensation account will not be further adjusted for any earnings or interest after such date.

3.           The payment of Duncan’s deferred compensation account on February 8, 2009, shall be in complete satisfaction of all benefits under the Agreement to which Duncan is entitled, and no benefits shall accrue or be credited to Duncan under the Agreement after such payment.

4.           Each provision of the Agreement that is inconsistent with the provisions set forth above hereby are amended to be consistent with this Amendment, including any provision relating to the time and form of payment of the deferred compensation account.

5.           It is intended that the Agreement and this Amendment comply in all respects with the provisions of Section 409A, and this Amendment and the remaining provisions of the Agreement shall be interpreted in a manner consistent with Section 409A.

IN WITNESS WHEREOF, the undersigned officers, being duly authorized by GCI and the Employer, respectively, and Duncan hereby approve and adopt this Amendment to be effective as of the date first set forth above.

GENERAL COMMUNICATION, INC.

By: /s/ John M. Lowber                                                                           

Title:  Senior Vice President

           Chief Financial Officer                                                                           

GCI COMMUNICATION CORP.

By: /s/ John M. Lowber                                                                           

Title:  Senior Vice President

           Chief Financial Officer                                                                           

/s/ Ronald A. Duncan                                                                           

Ronald A. Duncan