Artfest International, Inc (fka ARTS)

[EDWARD STEVENSON]

Two very extensive acquisitions are pending according to the company's 10K statement.

(1)Proposed Studio Acquisition
In August 2008 the Company entered into a Purchase and Sale Agreement to acquire a 35,000 square foot facility located in Dallas, TX that was constructed to handle the demanding requirements of top recording artists as well as the major film, television and commercial requirements of Fortune 500 corporations and their entertainment divisions.. Bands and artists such as the Jonas Brothers, Ice Cube, Miser, Rouge, Justin Timberlake, Miley Cyrus, P. Diddy, Mariah Carey, Usher and others have recorded in the studio. Artfest will be able to develop and produce high quality advertising and programming for traditional as well as Internet television through the Company’s television subsidiary, ArtChannel TV that will bring viewers and advertisers to our art and collectibles direct marketing site as well as to our social networking site, www.MyArtfest.com . The facility currently generates revenues over $500,000 annually and the Company dramatically expects to increase revenues dramatically once the acquisition is completed. The Company is currently reviewing financing options to conclude the transaction during 2009.


(2)Proposed Charity Sports Distributor Acquisition
In February 2009 the Company entered into a Letter of Intent to acquire Charity Sports Distributor, Inc. (d.b.a. CSD Sports Framing and Memorabilia) which was founded in 1996. CSD is a vertically integrated Texas based custom framing company which specializes in the design, production, and distribution of authentic framed autographed sports and entertainment collectibles and art pieces. CSD’s distribution avenues include B2B and B2C sales, charity fundraising auctions, professional and college sports team’s pro shops, e-stores, online auctions and a revolutionary in-game silent auction concept known as Home Game Auction. CSD’s thirteen (13) year experience in the professional and college sports marketplace has developed an extensive client list which consists of hundreds of private charities and over forty (40) professional and college teams, including the Dallas Cowboys, Washington Redskins, Oakland Raiders, Houston Rockets, Dallas Mavericks, Cleveland Cavaliers, Phoenix Suns, Arizona Diamondbacks, Dallas Stars, Ohio State, Texas, Texas A&M, Oklahoma, Alabama, Georgia, Auburn, Florida State and UCLA.

The Company expects to complete the acquisition during the Second Quarter of 2009 and be in a position to launch the distribution of CSD’s product line through Art Channel Galleries, the marketing arm and wholly owned subsidiary of Artfest International, Inc., during the Second Quarter 2009. The addition of CSD’s product line in the Second Quarter would compliment and expand the Company’s ongoing product promotions and special purchase packages that are directed towards introducing a select number of acclaimed artists to our members. Presently, the Company is reviewing several financing options in order to complete this synergistic acquisition as efficiently as possible in light of the Company having completed its required due diligence.

CSD recorded revenues in calendar year 2008 of $3.3 million. Upon closing, CSD will operate as a wholly owned subsidiary of Artfest International, Inc.

The Company believes that the acquisition of CSD will result in the immediate expansion and enhancement of our current product offerings and will lead to an expansion of the Company’s current audience. Furthermore the acquisition will enable the Company to vertically integrate framing and canvas stretching operations and enable the company to increase the overall profitability of our existing product lines.

“CSD’s innovative framing is widely regarded as the premier quality brand in the autographed memorabilia marketplace, and by joining teaming with Artfest International, CSD would posses one of the most expansive product portfolios in the autographed collectibles industry.


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