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HIA AND ACCI AGREE TO LETTER OF INTENT THAT WILL UNIFY ASSOCIATIONS

Combined Organization to Be Named the Craft & Hobby Association

August 9, 2003 - The Boards of Directors of the Association of Crafts & Creative Industries (ACCI) and the Hobby Industry Association (HIA) have voted to unify the craft and hobby industry under the leadership of a new association. The combined association, to be named the Craft & Hobby Association, will begin operating in February 2004, following the 63rd Annual HIA Convention & Trade Show in Dallas, TX.

"The ACCI and HIA Boards recognized that our two organizations are fundamentally similar, with like member bases and mission statements," said Lynda Musante (Nifty Development Corporation), ACCI chairman of the board. "As a unified association, the Craft & Hobby Association will go beyond operating two successful trade shows to build and brand the industry worldwide, provide education and research, and support our domestic and international membership in the most effective and efficient ways possible. The ACCI Board recognized that both associations represent the same industry and initiated the unification discussions."

"The HIA Board of Directors is pleased that we were able to come to agreement with our ACCI counterparts on a plan to unify the two major industry associations," said William Reed (Meredith Corporation), HIA Board of Directors president. "While time will be required for full and orderly change, what were once two duplicative associations will operate under one leadership structure to create a single vision and voice for the international craft and hobby industry."

Discussions concerning unification occurred informally for some time between ACCI and HIA until the associations' Boards agreed to form a joint task force in early 2003 to study the matter more closely. Operating under the basic principle of "do no harm" to the industry or the existing successes of both associations, the task force includes three members from each association's Board. The task force members are Jim Bremer (Tall Mouse Arts & Crafts), Emma Gebo (Crafts & Frames), Mike Hartnett (Creative Leisure Communications), Ron LaRosa (Delta Technical Coatings), Mike McCooey (Plaid Enterprises) and Jim Scatena (FloraCraft).

The Boards voted to pursue unification at their Board meetings in June and July, respectively, and on August 8 a formal letter of intent was distributed to and approved by each Board.

In accordance with the recommendations of the unification task force, the Craft & Hobby Association will be guided by the combined associations' Boards and led by HIA Executive Director Steve Berger. The combined Board will include 32 industry members, with a goal of reducing that number to 15 by 2007. Prior to unification, the ACCI and HIA Boards will continue their regular programs and elect officers who will guide the unified association in 2004.

Additionally, the task force recommends that all member committees, services, programs and activities remain in place, but should be subject to cost minimization and efficiency review and improvement initiatives over time. No immediate changes will be made to HIA staff.

New Craft & Hobby Association bylaws under development will utilize a single dues structure with membership by company and will allow for inclusion of all member categories. Moving forward, the new association will employ HIA's current membership and dues structure. ACCI dues will be eliminated and 2004 ACCI dues already paid will be refunded. The new bylaws will be distributed in the fall for review by ACCI and HIA members.

The Craft & Hobby Association will continue to sponsor two trade shows per year. The summer show remains under the ownership and operation of Offinger Management Co., which will provide a sponsorship fee to the unified association. Preparations for February's HIA 2004 trade show in Dallas, TX are well underway and no changes are expected as a result of the unification. Companies and individuals interested in participating in the winter trade show must pay 2004 HIA dues.

"The HIA staff is excited by this opportunity to work with the ACCI Board and Offinger Management to lead the international craft & hobby industry into a new era," Berger said. "Their expertise and experience will be instrumental in enabling the Craft & Hobby Association to maximize utilization of member funds and further improve member services. Also, our combined marketing, research and education resources will enable the unified association to extend beyond traditional borders to embrace new markets and industry segments."

Formal unification will occur in February 2004 in accordance with the laws of Illinois and Ohio, where ACCI and HIA, respectively, are incorporated. Additionally, the ACCI and HIA Boards will conduct due diligence of each association's title, assets and obligations/liabilities using an independent accounting firm.

About ACCI.

Established in 1976 as a regional organization, the Mid-American Craft and Hobby Association (MACHA) held its first trade show at the downtown Chicago Merchandise Mart in 1977. In 1984, MACHA became the Association of Crafts & Creative Industries (ACCI) to reflect its growth across the U.S. ACCI was instrumental in the industry's consumer outreach and research efforts, creating National Craft Month in 1988 and providing the industry's first Gallup Survey in 1992. Today, with almost 6,000 individual members in 40 countries, ACCI offers the industry's craft and creative marketplace every summer in Rosemont, IL. For more information, visit www.accicrafts.com.

About HIA.

Established in 1940 as the Model Industry Association, the Hobby Industry Association (HIA) serves the interests of over 4,900 member companies representing every segment of the craft and hobby industry, from design and manufacturing to distribution and retail stores. Every winter, the Association holds its annual trade show and convention, the largest craft and hobby supply exposition in the world. To help fulfill its goals, throughout the course of the year HIA is actively involved in promotional events designed to increase customers' knowledge and awareness of industry products. Additionally, the association has conducted a number of research projects, including consumer participation/size of industry, educational research and ethnic research studies. For more information, visit www.hobby.org.