GUIDELINES FOR MANAGERS

Before you can become a Merlin Media “Magician,” you need to know the basics!

Welcome! Thank you for your interest in Merlin Media, LLC. We only hire people who are the best at what they do, and who have the ability to lead change. We are thrilled you are considering joining our small band of renegades.

Media is in a period of significant change. Merlin Media intends to grow and prosper by understanding and leading some of these changes. Our business model is not one of working harder to execute yesterday's business plans, but one of developing plans that take advantage of the changes that are taking place. We will be a multimedia, multiplatform company that combines the one to many power and reach of traditional media with the one to one power of interactive and mobile.

RULES FOR MERLIN MAGICIANS

1. Rule #1- Use your best judgment.

2. Rule #2 -See rule number one.

Using your best judgment means following a lot of rules. FCC rules, IRS rules, local state and federal laws, GAAP, and maybe someday SEC rules among others. Most rules have unintended consequences, and even rules that work when they are written can have undesirable results over time. Rules take away thinking and judgment. Games have rules, and rules are gamed. Using best judgment means following the law, but we don't need too many additional rules. We need guidelines and principles and people who can think. It's the only way to greatness.

THE BIG THREE

Here are the three key things a Merlin Magician must do.

1. Protect the license. The value of the physical assets and equipment we have is quite low compared to the value of the FCC license. We can never risk losing a license to broadcast.

2. Preserve and enhance the goodwill. A good station will have a market value that is higher than the base value in the license plus the tangible assets. This additional value is called the "goodwill". It is created by historic cash flow, ratings, strength of the format, customer relationships, and value of the brand. We will not be doing a decent job until the value of the goodwill exceeds the value of the license. PS: You can't have goodwill without the license. See the first point.

3. Meet and exceed budgets. As you do so, remember point two. You can cut promotion to zero, fire half of the air staff, and perhaps exceed cash flow goals for one year, but if the ratings fall, the sales fall, and you have hurt the goodwill. Make your numbers, but see point 2.

OTHER FUNDAMENTAL GUIDELINES

1. No surprises. If there is going to be material deviation from plan, communicate. If something goes wrong, make sure we hear it from you. We are all on the same team. We'll all sleep better if we know that we can expect the ordinary course unless a manager speaks up. We will also try to make sure you hear news that affects you and your unit from us...

2. While we are a small company and getting to know each other, please communicate about contracts that bind the company for more than $10,000 or for longer than one year.

3. Keep your word. If you commit to a vendor or a listener, a customer or a competitor, we keep our word.

4. Play to win. Play fair, but there is nothing unfair about competing.

5. Take intelligent risk. The riskiest thing we can do is nothing. Doing something because it's always been done that way is only acceptable if you can stop time.

6. Reward successful performance. Successful performance should result in bonuses and promotions. Working hard is not the same thing as being successful. Life isn't fair. Luck and timing have a lot to do with success, but over time, rewarding successful performance is a good system.

7. Challenge authority. The best ideas don't necessarily come top down. Speak up. Encourage others to speak up. Once a decision is made on something, everyone should get on board, but everyone should have the opportunity and feel encouraged to offer a better idea.

8.HAVE FUN