Notice of AGM and EGM

 
TIDMFCE 
 
FACES COSMETICS PLC 
 
                             NOTICE OF AGM AND EGM 
           PROPOSING THE CANCELLATION OF ADMISSION TO TRADING ON AIM 
 
The Board of Faces Cosmetics PLC ("Faces" or the "Company") has today posted a 
circular to its shareholders ("Shareholders") convening a general meeting 
("General Meeting") of the Company to be held at the offices of Dowgate Capital 
Advisers Limited at 46 Worship Street, London EC2A 2EA at 11.15 a.m. on 25 
March 2009, immediately following the Annual General Meeting. At this meeting, 
Shareholders will be asked to approve the resolution necessary for the Company 
to cancel the admission of its AIM securities (the "Cancellation"). 
 
The Company has also today notified the London Stock Exchange plc of the 
intended Cancellation. If Shareholders approve the Cancellation at the General 
Meeting, Cancellation is expected to become effective from 7.00 a.m. on 2 April 
2009. 
 
The full text of the letter sent to Shareholders from the Company's 
Non-executive Director, Dimple Sanghi, is reproduced below. 
 
NOTICE OF AGM 
 
The Company's Report and Accounts together with a Notice of Annual General 
Meeting convened at the offices of Dowgate Capital Advisers Limited at 46 
Worship Street, London EC2A 2EA for 11.00 a.m. on 25 March 2009 have also been 
despatched to Shareholders today. 
 
Copies of the Report and Accounts for the year ended 31 July 2008 and the 
circular convening the General Meeting have been posted to Shareholders today 
and will be available from the Company's registered office and at the offices 
of Dowgate Capital Advisers Limited, 46 Worship Street, London EC2A 2EA, during 
normal business hours on any weekday (Saturdays, Sundays and public holidays 
excepted) and can be downloaded from the Company's website, 
www.faces-cosmetics.com. 
 
For further information, please contact: 
 
Faces Cosmetics plc 
Ramesh Jolly, President and CEO                Tel: [phone] Ext. 112 
 
www.faces-cosmetics.com 
 
Nominated Adviser 
Dowgate Capital Advisers Limited 
Liam Murray/Aaron Smyth                        Tel: [phone] 
 
 
 
LETTER FROM THE NON-EXECUTIVE DIRECTOR OF FACES 
 
"Dear Shareholder, 
 
           PROPOSAL FOR CANCELLATION OF ADMISSION TO TRADING ON AIM 
                                      AND 
                           NOTICE OF GENERAL MEETING 
 
1. INTRODUCTION 
 
I am writing to inform you that your Board believe that it is in the Company's 
best interests for the Company to cancel its AIM admission for the reasons set 
out below. Under the AIM Rules for Companies (the "AIM Rules") cancellation 
requires the consent of not less than 75 per cent. of votes cast by 
shareholders in a general meeting and, therefore, the Company is convening a 
meeting of shareholders to consider this proposal. 
 
The purpose of this document is to explain the background to and reasons for 
seeking to cancel the Company's AIM admission and to recommend that 
shareholders vote in favour of the resolution set out in the enclosed notice of 
the General Meeting. 
 
2. BACKGROUND TO AND REASONS FOR CANCELLING THE AIM ADMISSION 
 
The Company was admitted to trading on AIM on 7 September 2006 with a market 
capitalisation at the admission price of approximately GBP6 million and a share 
price of 11.75p. The reasons for admission were, inter alia, to raise the 
Group's profile, enhance its standing both in the US and the UK and create a 
public market in the Company's ordinary shares. 
 
Following careful consideration, the Board has concluded that it is no longer 
in the best interests of the Company or its shareholders to maintain the 
admission to trading on AIM of the ordinary shares. The current economic crisis 
has led to significant falls in the value of global stock markets, which have 
been exaggerated in small cap, low liquidity stocks. It is the opinion of the 
Board that the financial instability and a weakening of retail trading 
conditions in the Company's key markets have put pressure on its growth plans 
in the US and Europe and stagnated growth in the Company's established markets 
of Canada and Mexico. Whilst there are many factors affecting a company's share 
price, the impact of the depressed nature of the retail sector has led the 
Company to save costs wherever possible. The Directors consider that the cost 
of being an AIM listed company, which they estimate to be C$250,000 (or 
approximately GBP135,000) per annum, does not provide the Company with any 
significant benefit and, given the limited liquidity in the trading of its 
ordinary shares, the Board has decided that the Company would benefit from the 
flexibility of being unquoted. Shareholder approval is now being sought to 
cancel the Company's AIM admission in accordance with AIM Rule 41. 
 
Accordingly, the Board is convening the General Meeting to be held at 11.15 
a.m. on 25 March 2009 to consider and, if thought fit, approve the cancellation 
of the Company's AIM admission. 
 
3. EFFECT OF THE PROPOSAL ON SHAREHOLDERS 
 
The principal effects of the cancellation will be: 
 
a) that there would be no longer a formal market mechanism enabling the 
   shareholders to trade their ordinary shares through the AIM market. 
   Shareholders may continue to hold their shares in uncertificated form; 
 
b) that the Company may no longer use its AIM admission to access capital; 
 
c) that the Company would not be required to make notifications pursuant to 
   the AIM Rules; and 
 
d) to reduce the amount of time spent in meeting AIM Rule and related 
   regulatory requirements, including reporting, disclosure and corporate 
   governance requirements for quoted companies. 
 
The Company will endeavour to continue to provide a number of the same 
facilities and services to shareholders which are currently enjoyed as 
shareholders of an AIM company. The Company will: 
 
e) continue to send shareholders copies of the Company's audited annual 
   accounts; 
 
f) maintain the Company's website, www.faces-cosmetics.com, to keep 
   shareholders informed of developments; and 
 
g) continue to hold general meetings in accordance with the applicable 
   statutory requirements and the Company's articles. 
 
4. TRANSACTIONS IN THE ORDINARY SHARES FOLLOWING THE CANCELLATION FROM AIM 
 
The Directors are aware that shareholders may still wish to acquire further or 
dispose of ordinary shares and, accordingly, intend to use reasonable 
endeavours to create and maintain a matched bargain settlement facility (the 
"Facility"). Under the Facility, shareholders or persons wishing to acquire 
shares will be able to leave an indication with the Facility provider that they 
are prepared to buy or sell at an agreed price. In the event that the Facility 
provider is able to match that order with an opposite sell or buy instruction, 
the Facility provider will contact both parties and then effect the order. 
Shareholders who do not have their own broker will need to register with the 
Facility provider as a new client. This can take some time to process and 
therefore shareholders who consider they are likely to avail themselves of this 
facility are encouraged to commence it at the earliest opportunity. 
 
The contact details of the Facility provider once arranged will be made 
available to shareholders on the Company's website, www.faces-cosmetics.com. 
 
5. EXPECTED TIMETABLE OF PRINCIPAL EVENTS 
 
In accordance with AIM Rule 41, the Company has today notified the London Stock 
Exchange of its intention to cancel admission of its AIM securities. Set out 
below is the expected timetable of events: 
 
Announcement of General Meeting                              24 February 2009 
 
Latest time and date for receipt of completed     11.15 a.m. on 23 March 2009 
forms of proxy to be valid at the General 
Meeting 
 
Annual General Meeting                            11.00 a.m. on 25 March 2009 
 
General Meeting                                   11.15 a.m. on 25 March 2009 
 
Last day of dealing in ordinary shares                           1 April 2009 
 
Cancellation of admission to trading on AIM         7.00 a.m. on 2 April 2009 
effective from 
 
Each of the times and dates in the above timetable is subject to change. If any 
details in the above timetable should change, the revised times and dates will 
be notified to shareholders by means of an announcement through a Regulatory 
Information Service. 
 
6. ANNUAL GENERAL MEETING 
 
A notice convening the Annual General Meeting of the Company for 11.00 a.m. on 
25 March 2009 at the offices of Dowgate Capital Advisers Limited, 46 Worship 
Street, London EC2A 2EA accompanies the report and accounts of the Company for 
the year ended 31 July 2008 which accompanies this document. At the Annual 
General Meeting resolutions will be proposed dealing, inter alia, with the 
ordinary business to be transacted, including the approval of the report and 
accounts for the year ended 31 July 2008. 
 
7. GENERAL MEETING 
 
You will find set out at the end of this document a notice convening the 
General Meeting of the Company to be held at the offices of Dowgate Capital 
Advisers Limited, 46 Worship Street, London EC2A 2EA at 11.15 a.m. on 25 March 
2009, immediately following the Annual General Meeting. 
 
At the General Meeting, the special resolution to cancel the admission of the 
Company's ordinary shares to trading on AIM will be proposed. To be passed, the 
resolution requires a majority of not less than 75 per cent. of shareholders 
voting in person or by proxy in favour. 
 
If the resolution is approved, it is expected that cancellation of dealings 
will take effect on 2 April 2009. 
 
8. ACTION TO BE TAKEN 
 
Shareholders will find enclosed with this letter a form of proxy for use in 
connection with the General Meeting. Whether or not you intend to attend the 
General Meeting, you are requested to complete and return the form of proxy (in 
accordance with the instructions printed thereon) to the Company's registrars, 
Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, 
Surrey GU9 7LL or by fax to [phone], as soon as possible and, in 
any event, so as to arrive no later than 11.15 a.m. on 23 March 2009. 
 
You are entitled to appoint a proxy to attend and vote instead of you. However, 
the completion and return of the form of proxy will not prevent you from 
attending the General Meeting and voting in person if you wish to do so. 
 
If you are in doubt with regard to your current shareholding in ordinary shares 
or have any queries on the form of proxy you should contact the Company's 
registrars, Share Registrars Limited, on the following telephone number: 01252 
821 390, or from outside the UK [phone]. 
 
The attention of shareholders is also drawn to the voting intentions of the 
Directors as set out in the paragraph below. 
 
9. RECOMMENDATION 
 
The Directors consider that the proposal to cancel the Company's AIM admission 
is fair and reasonable and in the best interests of shareholders as a whole. 
Accordingly, the Directors, who own 7,676,173 ordinary shares, representing 
approximately 4.3 per cent. of the Company's issued ordinary share capital 
respectively, have irrevocably undertaken to vote in favour of the resolution. 
 
In addition, the Company has received an irrevocable undertaking from 
Indivision Ventures II (a substantial shareholder and a company of which Dimple 
Sanghi and Jaspal Singh Sabharwal are corporate representatives) to vote in 
favour of the resolution which amounts to 125,000,000 ordinary shares, 
representing approximately 70.0 per cent. of the Company's issued ordinary 
share capital. 
 
Yours faithfully 
 
Dimple Sanghi 
Director" 
 
 
 
END