It's now the night before Arthur's big battle with King Lot's men. Uh oh. Arthur's army is outnumbered by about 3 to 1. This doesn't look good.
Merlyn assures Arthur he will win the battle… but there's still that thing that's bothering him. Something he's sure he's forgotten to tell Arthur—and it's super important.
Merlyn starts to count things off on his fingers. He's warned Arthur about Guenever, right? And about Guenever and Lancelot, right?
Arthur disregards the warning about Guenever and Lancelot, since it's "base" (or too impolite to discuss in polite company).
Did Merlyn remind Arthur to make sure he always protects Excalibur's sheath? What about telling him about his father?
Arthur tries to shut all this down, because he doesn't want to know too much about the future.
Merlyn then proceeds to tell Arthur a parable about Death and a man from Damascus. To avoid Death, he decides to ride to a different town. The joke's on him, though, because when he arrives in the other town, Death is there waiting for him: he was actually supposed to meet him in that town, which is why he was surprised to see him in Damascus the day before.
The upshot of this is that people can't escape their destiny.
In fact, Merlyn tells Arthur, both of them are destined to return. Plus, a fancy-schmancy Latin phrase will be inscribed on Arthur's tomb, which means: Here lies Arthur, the once and future King.
Arthur hopes that in the future the people will remember his Round Table.
Merlyn just looks sad, and Arthur frantically wonders what the future people will be like.