PAX Prospect Acquisition Corp.

Equity Broadcasting Prevails in Arbitration Against Paxson Communications Broadcaster Will Terminate All PaxTV Network Programming in St. Louis, Montgomery & Panama City This Sunday LITTLE ROCK, Ark., Aug. 27 /PRNewswire-FirstCall/ -- Equity Broadcasting Corporation, the nation's ninth largest television broadcast station group, announced today that a three member arbitration panel ruled in its favor in an ongoing arbitration proceeding with Paxson Communications Corporation (AMEX:PAX). The Panel ruled that Paxson breached "most favored nations" provisions in Equity/PaxTV network affiliation agreements by failing to offer amendments that would have shortened the ten year agreements to two years, and the Panel exempted Equity from broadcasting PaxTV infomercial and religious programming since 2001. The Panel further ruled it would hold a hearing later this year to determine Equity's damages resulting from PaxTV's breach. Equity also announced that as of midnight August 29, it will cease broadcasting PaxTV programming on the three stations directly affected by the Ruling -- WPXS in St. Louis (DMA # 21); WBMM in Montgomery, Alabama (DMA # 115); and WBIF in Panama City, Florida (DMA #158). Equity has also notified Paxson that it will cease broadcasting PaxTV on KWBS in Springfield, Missouri (DMA #78) and Fort Smith-Fayetteville, Arkansas (DMA #107), a station that was not involved in the arbitration directly, but which is subject to termination on the same basis as are the other three stations. PaxTV, the so-called "seventh network", was launched in 1998 with a promise to provide twenty four hours a day of quality family-oriented programming free of excessive violence, explicit sexual themes and foul language. Unable to garner viable ratings for its schedule of low budget original programming and late-cycle syndicated programming, in January 2003, PaxTV increased its infomercial and paid programming to more than half of its broadcast day. "The Panel's ruling means that we can terminate PaxTV in these markets, and focus on rebuilding these stations to better serve our viewers." Said Larry Morton, Equity's Chairman and CEO. "These stations represent more than 2% of US television households. Not being locked into long term PAX affiliations should significantly improve Equity's position in these markets." "Last week, Paxson's Chairman criticized NBC for failing to abide by the 'plain meaning' of 'clear and unambiguous terms' of an agreement," said Jeff Sanders of Seyfarth Shaw in New York, Equity's counsel in the arbitration. "It is somehow fitting that the Panel's ruling here is based on the conclusion that Paxson failed to honor the unambiguous language of its own affiliation agreements." About Equity Broadcasting Corporation Equity Broadcasting Corporation has become one of the fastest growing broadcast companies in the United States. Since 1997, the company has dramatically increased its broadcast holdings and vaulted into the enviable position of being one of the 10 largest broadcast companies in the country. For more information on Equity Broadcasting Corporation, please visit the company's Web site at http://www.ebcorp.net/ . DATASOURCE: Equity Broadcasting Corporation CONTACT: Jeff Sanders of Seyfarth Shaw, +1-212-218-5280, Web site: http://www.ebcorp.net/

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