Background on the Company

AMERICAN COMMUNICATIONS ENTERPRISES, INC. BUSINESS PLAN

PLAN  National

American

Acquisition and Operating Strategy

ACEN will pursue a

Radio Industry Conditions

ACEN competes in

Management

A highly respected BACKGROUND ON

Overview

Radio station

Historical Trends in Ad Revenues

Radio industry

Industry Consolidation

The radio broadcast

Competition

Competition within

Regulation

The radio broadcast

Summary of Why Radio Industry is Attractive

Management BACKGROUND ON

Overview

The Internet's brief and meteoritic existence provides little historic performance data. Entrepreneurs and Fortune 500 companies are now racing forward to capture the market of the next millennium. Only a few short years ago Internet companies were struggling to carve out revenue. Most Internet sites were free information based entities with links to related and unrelated sites. Now billions of dollars in revenue are generated from advertising, web development and retailing. The success of other broadcast related Internet sites such as Broadcast.com are proof of the intense interest Internet users have in radio content. Major electronic manufactures have products and/or are developing the integrated Internet products for next generation home systems and mobile systems. Future delivery of the Internet is slated to arrive via cable or satellite to multi-purpose home entertainment systems that will function as Internet links, computers, radios and TV sets. Cellular phones currently can connect to the Internet as well as automobile radios. There appears to be little or no limit to the ways and means to access the "Net". The Internet is the media of the future. THE INTERNET INDUSTRY believes that the radio broadcast industry is attractive for a number of reasons. First, the industry is in a consolidation mode. This consolidation mode bodes well for higher valuations and the realization of significant economies of scale. Second, advertising fees have consistently increased over the last 30 years, and due to the ability of radio to reach a unique spectrum of listeners, will continue to increase over the foreseeable future. The growth and success of other publicly traded broadcast consolidators indicates that the timing is right for the ACEN consolidation strategy. Finally, while competition for ad dollars and ratings remains intense, ACEN believes that it can effectively compete with other stations and station groups by focusing on small- and middle-sized markets as these are areas that have fragmented competition.

industry is subject to extensive regulation at the federal level. Any change in existing statutes and regulations, or the adoption of new statutes and regulations, force stations to alter their methods of operation at substantial costs. All firms, whether large or small, are affected by these changes. Also, as seen in recent legislative action (the 1996 Telecom Act), changes in regulations, especially, deregulation; can drastically shift the competitive landscape. Trends in Ad Revenues

The most lucrative advertising comes from banner Additional Revenues advertising. Banner advertisersThe Internet pay has for "hits"become or a global "impressions"market place for based Competition oncommercial the number and of userconsumerCompetition exposures goods within to theirfromthe Internet ads.banking National to soft brandsgoods.community in every and from Regulation industryEntrepreneurswithout will are be now fierce.and usingnationalInternetThe Internet the "audiences"brands Internet is under are as alsowillno enforceable continue enjoying to be phenomenalexposedregulation to at thisgrowth Summary of Internet Industry Attractiveness throughnewspaper,time. Although "catalog" TV, the retailradio,U.S.The Internet Governmentsales direct on mail,industry the etc. Themaywill prevail advantagesprevail as in the of theregulatingmedia Internet of choice some lie in in the functionsthe foreseeable of U.S. basedfuture. webThe almostsites and Company Preview portalsunlimited there is good reasonopportunitiesAmerican to believe for it growthTHECommunications COMPANY and expansionEnterprises, are Inc., the a Overview of Operating Model and Growth Strategy keyNevada points corporation, for selectionisThe based ACEN inof Austin,operatingthe Texas.model isACEN has alreadystraightforward closed itsand The Internet Component initialefficient. public It offering. Theincorporates Company many Marketing Plan

ACEN recognizes that a major component for Advertising and Promotion success is extensive promotion. This must be done aggressively ACEN stations will be positioned as the leading "fun-to-listen-to-station" in each market. Increase station awareness and on a market- and dial position recognition among retailers, buyers and listeners. wide scale. The ACEN believes it will be possible to increase group revenue far over the current group operator's level for the following Company plans to reasons: advertise (whenever Because it does not currently exist as a group none of these stations are currently sold as a total advertising package. and wherever Any regional advertiser with business locations in each of the proposed ACEN markets will have to make separate possible) in local media buys with each individual station at the present. That would mean having to deal with numerous sales people in publications and also each market, conceivably up to 15 different salespeople. With ACEN's sales plan, this same advertiser can contact utilize outdoor any one of the ACEN stations and buy advertising time on the whole group by contacting just one Marketing advertising as well as Consultant. As a network, ACEN will be able to garner more sales immediately. bumper stickers. Additionally, as ACEN adds affiliate stations to its programming network (i.e., stations that buy ACEN's satellite Advertising will be programming but stations in which the Company has no financial interest), that will only enhance its ability to sell done independently network advertising. The Company anticipates that this could possibly add approximately $20,000 to $50,000 a year in as well as additional revenue. cooperatively with client retailers and companies with whom ACEN has joint marketing/sales Advertising and Promotion (continued) relationships. InBoost addition local, to direct retail advertising sales on the stations in this new group where too much emphasis was placed on standardnational and advertising regional sales and not enough was focused on local sales. practices,In some of the stations, it will be just the opposite where too much emphasis has been placed on local sales and Managementpractically nothing has been done to garner national or regional advertising. Local sales normally run 75% of revenue believesat stations, the but of that 25% of national and regional advertising rates can be (and normally is) much higher than the Companyadvertising will rates gain charged local advertisers. considerableGenerally speaking, the size of the sale staffs at each ACEN station will grow while the programming staffs will be recognitiondown-sized throughto reflect the Company's satellite programming approach. on-airAdditionally, contests, a higher local level of emphasis will be placed on the actual in-house production of advertiser's commercials. promotions,All ACEN marketing and consultants will be thoroughly trained in marketing their respective stations without reliance on "word-of-mouth"ratings. advertisingACEN stations will sell results. That is really the only thing that matters in markets of this size. Further, ACEN endorsements.recognizes that it is imperative to structure a compensation plan for its sales people that is both fair and appealing to Recognitionattract and retain the best available people. generatedOur compensation from plans will include on-going sales training programs and motivational seminars to help each sales promotionalperson gain moreactivities "tools" to use in their sales calls along with bonuses on top of their commissions for outstanding iswork. very important to ACEDevelop, because through these on-going market research, specific information to help clients develop immediate and long-term projectsmarketing tend plans. to be This will include specific "Top-of-Mind-Awareness" research projects. developedCoordinate at sales the literature, telemarketing programs and direct response promotions in order to build Company billings. localA terrible level. thing Being happens when no one calls on a potential advertiser...nothing. viewed as a truly local station is highly valued by both Media Objectives advertisers and listeners in the

Advertising Campaign

GainThe best awareness way to of ACENreach our stations potential To maintain our image, the delivery and tone of our statements will reflect hard driving excitement tempered by "slice- of-life" presentation. Ads will convey the look and feel of a super successful radio station. Ideally, after becoming familiar with our programming, the listener will seek ACEN stations out. The same should be true for potential advertisers. To eliminate the biggest objections to immediate action by potential advertiser, our advertisement and sales presentation material must address anticipated objections and/or difficulties with service acceptance and how to put together a reasonably priced advertising campaign for their business. This is where the Company will share the results of its on-going market research with potential advertisers, showing them how they have fared in the TOMA research. Because ACEN wants its stations to be the best station in the markets they serve, it is important to develop a promotional campaign that is consistent and easy to understand. Accordingly, ACEN has created a system of research and response via Radioactivity, Inc., to insure the maximum benefit of its advertising dollars. Establish an image of the Company’s stations as stations that are very professional, completely reliable, and competitive in the market. Maximize efficiency in selection and scheduling of advertising for clients to give them a wide range of ad spot package choices. Promotion

Incentives

Direct Mail

Programming

Broadcast Equipment

Additional Revenue Sources

Management

ACEN benefits from a coupling of several

Strengths

Risks and Mitigating Factors

SAFE HARBOR DISCLAIMER-Certain statements contained herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and 21E of the Exchange Act of 1934. Such statements include, without limitation, statements regarding business and financing, business trends, future operating revenues and expenses. Although the Company believes that the statements are reasonable, it can give no assurances that such expectations will prove to be correct. Investors are cautioned that any forward-looking statements made by the Company contain no guarantee of future performance, and that the actual result may differ materially from those set forth in the forward-looking statements. Difference in results can be caused by various factors including, but not limited to, the Company's ability to be able to successfully complete planned funding agreements, to successfully market its Potential Increased Competition for Acquisitions: Deregulation has wrought the formation of several huge radio groups that are aggressively consolidating stations in the larger markets. Recently, consolidation activities have increased in the upper end of the middle markets (top 50 to 100 markets). The competition in these markets has intensified and acquisition multiples have moved higher. While there is no guarantee that these larger groups will not begin to search for stations in smaller markets, it is unlikely in the near term (next two to three years). Should the larger competitors enter the smaller markets, ACE might be forced to avoid certain sought-after acquisitions due to rising sales prices. However, ACEN could also be a beneficiary of higher acquisition multiples in its markets. Achievement of Synergies: ACEN’s business strategy is sound. At this point, the Company is too young to definitively determine whether or not it will be able to achieve incremental revenues and cost savings on an ongoing basis. Important to note however, the enclosed projections do not assume "extraordinary" benefits associated with synergies. While the achievement of the projections will be a very important factor related to IRR, the principal value of the Company's senior debt and any preferred stock issued is not dependent upon the realization of significant synergies. Managing Rapid Growth: ACEN should able to grow rapidly. The list of acquisition candidates is large and growing daily. Completing and integrating these acquisitions will can possibly prove challenging for Management. Fortunately, the management team has actual experience in closing and integrating acquisitions. Implementing the network can also be challenging. But, the Company is using tested technology that has been used successfully in radio applications, in some cases, for 15 years or more. All of the statements made herein are forward looking except where noted as historical data. ACEN reserves the right to make changes in their business plan and strategies as required by specific conditions and indicated trends in the broadcast industry and by prevailing economic conditions.

RISK ANALYSIS successful broadcasters who have documented management experience. Name Position Age Dain Schult President and Chief Executive Officer 45 Robert Ringle EVP/Internet Operations and Director of Sales 55 Hap Hedges EVP/Chief Operating Officer 54 Dain Schult - President and Chief Executive Officer: Dain Schult will serve as both president and chief executive officer of ACEN. Mr. Schult is a broadcast veteran of over 30 years in the radio industry. Prior to the formation of ACEN, Mr. Schult was president of Radioactivity, Inc., a full-service radio broadcast consulting firm serving over 150 radio stations in various parts of the country. While there, Mr. Schult participated in the turnaround of several stations, created a unique turn-key management service for new station owners, conducted station appraisals and market analysis projects for sellers and buyers, and developed specific music formats for on-air use by client stations. Concurrently, Mr. Schult was chief operating officer for Sunbelt Radio Group, Inc., a radio station group created to acquire and operate radio stations in Texas. Previously, Mr. Schult had held various program manager, operating manager, and on-air personality positions at several radio stations in the Southeast and Southwest, including serving as president and chief executive officer for Equicom, Inc. Mr. Schult holds an A.S. degree in Commercial Music-Recording from Georgia State University. Robert E. Ringle - Executive VP/Internet Operations and Director of Sales: Mr. Ringle has extensive experience in Internet operations and has held the position of Director of Sales for a regional radio broadcasting network of over 30 stations which included creation of sales training programs, image enhancement and the centralized billing system. He has owned and operated a Detroit-based full-service advertising agency. Mr. Ringle has a BS degree in Marketing from Wayne State University. Hap Hedges - Executive VP/Chief Operating Officer: As senior vice president of group operations for the Company, Mr. Hedges brings with him over 29 years of experience in the radio broadcasting industry. Prior to the formation of the Company, Mr. Hedges was Senior Vice-President/Regional Manager for Equicom, Inc., garnering some of the highest sales goal achievements in the entire group. Additionally he served as an associate consultant with Radioactivity, Inc., and founded Hedges and Associates, a sales and marketing company formed to represent Western and Southwestern clothing and accessories manufacturers to various department stores and western-wear boutiques throughout East and Central Texas. Previously, Mr. Hedges held various general manager, sales and promotion manager, account executive, and news reporter/copy writer positions at several stations in Texas. Mr. Hedges studied at the University of Houston.

products incompetitive industries or to effectively implement its business plan or strategies.