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					                            EXHIBIT C




DALLDQCS\a^?34^6240427.10
356412-3
FINANCIAL
STATEMENTS
                               FACES COSMETICS USA, INC.
                                FINANCIAL STATEMENTS




        The Financial Statements as of December January 31, 30062008 have been prepared
without an audit. Prospective franchisees or sellers of franchises should be advised that no
independent Certified Public Accountant has audited these figures or expressed an opinion with
regard to their content or form.




DALLDOC    S\3444?JU24043S.l
356412-3
5:37 PM                          Faces Cosmetics USA
02/13/08                                Balance Sheet
Accrual Basis                       As of January 31, 2008

                                                                           Jan 31, 08

                 ASSETS
                   Current Assets
                     Chequing/Savings
                        11120 TD Bank US$                                             320.36
                        11130 Bank of America                                       6,947.69

                       Total Chequing/Savings                                       7,268.05

                       Accounts Receivable
                                                   11210 Accounts receivable                                  271,364.40

                       Total Accounts Receivable                                  271,364,40

                       Other Current Assets
                          11400 Prepaid Expenses                                   47,617.62
                          22123 Due from Faces Cos PLC                            210,198 79

                                                   Total Other Current Assets                                    257,816.41


                   Total Current Assets                                           536,448.86

                   Fixed Assets
                      12300 Computer Equipment                                      3,091.01
                      12301 Accumulated Amortization                               -1.251.86

                                                             Total Fixed Assets                                                      1,839.15


                 TOTAL ASSETS                                                    538,288.01

                 LIABILITIES & EQUITY
                    Liabilities
                       Current Liabilities
                           Accounts Payable
                               Accounts Payable                                      902.12
                               Accrued Payables                                    7.080.7G

                          Total Accounts Payable                                    7,982.88

                          Other Current Liabilities
                                         22122 Due To Faces Cosmetics                          1,064,332.51

                          Total Other Current Liabilities                     1,064.332.51


                       Total Current Liabilities                              1,072,315.39

                       Long Term Liabilities
                         22115 Faces Holdings Inc                                 -80.027.58
                         22119 Due to/from Faces Canada                            -1,000 00

                                                   Total Long Term Liabilities                                    -81,027.58


                    Total Liabilities                                             991.287.81

                    Equity
                      29999 Retained Earnings                                    -248,926.51
                      Net Income                                                 -204.073.29

                                                      Total Equity           •                                             -452,999.80

                 TOTAL LIABILITIES & EQUITY                                  538,288.01

 5:37 PM                           Faces Cosmetics USA Profit

 02/13/08                                          & Loss
 Accrual Basis              August 2007 through January 2008

                                                                     Aug *07 - Jan 08

                       Ordinary Income/Expense
                          Expense
                             42100 Advertisement                                  1,845.00
                             0      Show Exponscs                                 2,423.50
                             42140 Bank Charges 42325                               166.65
                             Consulting Fees 42370 Rent                          -4.000.00
                             Expense 42383 Travel                                 3,210.18
                             Expenses 42386 Travel USD                            7.963.50
                             42400 Salaries and Wages                            14,954.37
                             44153 Commission                                    75,291.30
                                                                                  5,000.00
                           Total Expense
                                                                          106,854.50
                       Net Ordinary Incomo
                       Other Income/Expense Other                         -106,854.50
                          Expense
                             0      Audit Expenses
                             42327 Franchise Expense                      10,000.00
                             42329 Legal expenses                         69,677.83
                                                                          17,540.96
                           Total Other Expense Net Other
                                                                          97.218.79
                       Income
                                                                          -97.216.79


                    Net Income                                             -204,073.29
          M R P R GROUP c P A       s   &   A d v i s o r s




      FACES COSMETICS USA. INC.

       FINANCIAL STATEMENTS

     FOR THE YEARS ENDED JULY 31,
  2007, 2006 AND 2005

              AND

INDEPENDENT AUDITORS' REPORT
                                                       One Northwestern Plaza. 3841 I Northwestern Highway. Suile 800, South field, Ml 48Q34-553B
                                                                         (348) 357-9000   Fan (148) 357-9001   www.mrpr com




                                  INDEPENDENT AUDITORS' REPORT



To the Board of Directors and Stockholders Faces
Cosmetics USA, Inc. Etobicoke, Ontario


. We have audited the balance sheets of Faces Cosmetics USA, Inc. (a Nevada corporation) as of July 31,
  2007 and 2006, and the related statements of operations, changes in shareholders' equity (deficit) and
  cash flows for each of the years in the three year period ended July 31, 2007. These financial statements
  are the responsibility of the Company's management. Our responsibility is to express an opinion on these
  financial statements based on our audits.

We conducted our audits in accordance with standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position
of Faces Cosmetics USA, Inc. as of July 31, 2007 and 2006, and the results of its operations and its cash flows for each
of the years in the three year period ended July 31, 2007 in conformity with accounting principles generally accepted
in the United States of America.




Southfield, Michigan
January 8, 2008




                                                                                                                   PIL-        ARIS
                                                                                                                               "
                                M R P R GROUP c P A                 s   &   A d v i s o r s




                                         TABLE OF CONTENTS




FINANCIAL STATEMENTS:

Balance Sheets, July 31, 2007 and 2006

Statements of Operations, For the Years Ended July 31, 2007, 2006
 and 2005

Statements of Changes in Shareholders' Equity (Deficit), For the
 Years Ended July 31, 2007, 2006 and 2005

Statements of Cash Flows, For the Years Ended July 31, 2007,
 2006 and 2005

Notes to Financial Statements
                                             FACES COSMETICS USA, INC.




                                                   BALANCE SHEETS JULY
                                                31,2007 AND 2006



                                                         ASSETS

                                                                                       2007             2006

CURRENT ASSETS:
Cash and cash equivalents Accounts                                                       $ 1,322
receivable - Notes 2 and 3 Prepaid expenses -                                           136,364
Note 2 Due from related parties - Note 4                                                  42,618
                                                                                        290.226
      Total current assets
                                                                                       470,530
PROPERTY AND EQUIPMENT - Note 1 :
 Computer equipment Less: Accumulated
 depreciation                                                                          3,091        f
                                                                                    1.252)
       Net property and equipment
                                                                                          1,839
OTHER ASSETS:

Accounts receivable - Notes 2 and 3                                                    135.000

     Total other assets                                                             $ 607,369 $

        TOTAL                                                                       344 51,538

                                                                                    18,610

                                                                                    290.226

                                                                                    360,718



                                                                                         3,091
                                                                                          (464)

                                                                                         2.627


                                 LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)



CURRENT LIABILITIES:
Accounts payable                                                                    $ 16,678
Due to related parties - Note 4                                                        839.618
                                                                                                               1
     Total current liabilities                                                        856,296
                                                                                                         11.662
SHAREHOLDERS' EQUITY (DEFICIT):
                                                                                                        11.663 S
Common stock, $.01 par value - authorized unlimited number of shares;
 issued and outstanding, 100 shares Retained earnings (deficit)                                 1
                                                                                                        363.345
     Shareholders' equity (deficit)                                                 (248.928)

        TOTAL                                                                       (248.927) S

                                                                                    607.369 $

                                                                                    351.682

                                                                                    351,682



                                           See notes to financial statements. -7-
                                         FACES COSMETICS USA, INC.




                              STATEMENTS OF OPERATIONS FOR THE YEARS ENDED JULY
                                             31. 2007. 2006 AND 2005



                                                                      2007          2006       2005


REVENUES:
Initial franchise fees - Note 3                                       $ 339,000
Franchise royalty                                                        16,076
Other

     Total revenues                                                   355,076

                                                                  $      25,000
                                                                       1,538
                                                                       6,700"

                                                                      33,238 $
                                                                       153,750




                                                                  153,750
                                                                                             31
ADMINISTRATIVE AND OPERATING EXPENSES:
Advertisements                                                              196
Audit expenses                                                           10,000
Bank charges                                                                485
                                                                                      74
Commissions                                                              13,669
Consulting fees                                                          54,460
Depreciation                                                                788
Franchise expenses                                                       22,538       464      169,146
Insurance                                                                16,576
Legal expenses                                                           65,203
                                                                                                  1,596
Management fees
Meals and entertainment                                                   8,561
Office supplies                                                           6,728
Postage and stationary                                                      930
Public relations                                                         28,443
Recruitment expenses                                                     30,000
Rent expense                                                             34,715
Salaries and wages                                                      220,757
Show expenses                                                            21,392
Telephone                                                                 2,953     4,015
Travel expenses                                                          77.272
    Total administrative and operating expenses                         615.666               170.773 S
NET INCOME (LOSS)
                                                                                            f 17.023)

                                                                                    4.553

                                                                                  $26^85




                                        See notes to financial statements.

                                                       -8-
                                           FACES COSMETICS USA, INC.




                      STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT) FOR THE
                                  YEARS ENDED JULY 31, 2007, 2006 AND 2005




                                                                                        11,663
                                                     Shares        Amount

                                                     100               $1            (260590) $
BALANCE, JULY 31,2004

                                                                                    Ï248.927Ï
Net loss for the year ended July
 31,2005

BALANCE, JULY 31,2005                                100

Net income for the year ended July
 31, 2006

BALANCE, JULY 31,2006                                100

Net loss for the year ended July 31,
 2007

BALANCE, JULY 31,2007                                100           $1
                                                                     Retain
                                                                         ed
                                                                     Earnin
                                                                         gs
                                                                    (Deficit
                                                                           )

                                                                   $


                                                                   ( 17.023)

                                                                   ( 17,023)



                                                                         28.6

                                                                         85

                                                                         11,6

                                                                         62



                                                                   (260.590)



                                                                        Total

                                                                   $            1



                                                                   ( 17.023)

                                                                   ■(

                                                                   17,022)



                                                                         28.6

                                                                         85




                                       See notes to financial statements. -9-
                                            FACES COSMETICS USA, INC.




                                      STATEMENTS OF CASH FLOWS FOR THE YEARS
                           ENDED JULY 31. 2007. 2006 AND 2005



                                                                           2007                  2006                     2005

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                       $(260,590)            $ 28,657         $ ( 17,023)
Adjustments to reconcile net income (loss) to net cash
(used in) provided by operating activities:
     Depreciation                                                                    788         464
     Changes in operating assets and liabilities:
      Accounts receivable                                                  (219,826)            ( 1,538)       ( 50,000)
      Prepaid expenses                                                     ( 24,008)             40,993        ( 44,754)
      Accounts payable 16.678                                                                        __ _____________

                  Net cash (used in) provided by operating activities             (486.958)                  68.576              (111.777)

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of computer equipment ______________________________________                          ( 3.091) _____________

          Net cash used in investing activities ______________________________                   f 3.091)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in advances (to) from related parties
                                                                             487.936             (73.709)             120.344
        Net cash provided by (used in) financing activities                  487.936             (73.709)             120,344
                                                                                 978            ■ ( 8,224)               8,567
                                                                                 344                8.568                    1
INCREASE (DECREASE) IN CASH                                                    1.322               $ 344               $ 8.568

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR CASH

AND CASH EQUIVALENTS, END OF YEAR




                                         See notes to financial statements.

                                                         -10-
                                           FACES COSMETICS USA, INC. NOTES

                                       TO FINANCIAL STATEMENTS




NOTE 1 - Nature of Business

       Faces Cosmetics USA, tnc.'s ("the Company") principal activities are the sale of franchises in the United
       States of America and internationally under both master and individual franchise agreements. The
       Company is located in Canada along with its parent company Faces Cosmetics, pic (FHP) and related
       companies Faces Holdings, Inc. (FHI) and Faces Cosmetics, Inc. (FCI). FCl provides management and
       financial services to the group and has invested significant funds into the development of the USA
       market.

       The Company has a presence in the USA in 2006 with a store in Arlington, Texas and in 2007 has sold
       franchise rights to several other franchisees in Virginia, Maryland and California. In that connection, the
       Company has undertaken additional market research and invested in additional executive management
       and consultants and incurred significant other start-up costs which are to be reimbursed to the Company
       by its parent company and a related company (Note 4).




NOTE 2 - Summary of Significant Accounting Policies

       Basis of presentation - The financial statements is prepared and presented in U.S. dollars in accordance
       with accounting principles generally accepted in the United States of America.

       Cash and cash equivalents - Cash on short-term deposits in bank accounts and other short-term
       investments is considered as cash and cash equivalents.

       Accounts receivable - At July 31, 2007 and 2006, accounts receivable consists of franchise fees due in
       connection'with initial franchise sales which are payable upon the opening of various stores from fiscal
       2007 to 2011. At July 31, 2007, receivables also include royalty fees of approximately $15,000 due from the
       Texas franchisee (see Note 3). Management expects to collect the franchise fees as the stores open; and
       have determined that no allowance for doubtful accounts is necessary.

       Prepaid expenses - At July 31, 2007 and 2006, prepaid expenses consists of costs related to anticipated
       future franchise sales and will be amortized over future periods.

       Property and equipment - The computer equipment is recorded at cost and depreciation is computed on
       an accelerated method. Costs of maintenance and repairs are charged to expense when incurred.

       Asset impairment - The Company records impairment losses on long-lived assets when events and
       circumstances indicate that the assets may be impaired and the undiscounted net cash flows estimated to
       be generated by those assets are less than their carrying amounts. If the future undiscounted cash flows
       are not sufficient to recover the carrying value of the assets, the assets are adjusted to their fair values.
                                           NOTES TO FINANCIAL STATEMENTS
                                      (CONTINUED) _________________________




NOTE 2 - Summary of Significant Accounting Policies - (Continued)

        Franchise Arrangements - Individual franchise arrangements consist of a license which provides for
        payment of initial fees as well as services to the Company based on a percent of sales. Franchisees pay
        related occupancy costs including rent, property taxes, insurance, and maintenance.

        Franchise fee revenue recognition - The Company recognizes initial franchise fee revenue from sales of
        individual franchises when substantially all significant services to be provided by the Company have
        been performed. In management's opinion, substantially all significant costs of servicing the initial
        franchise agreements has been incurred relating to initial franchise fees recognized as income in the
        accompanying statements of operations. Continuing fees and royalties are recognized in the period
        earned.
       Use of estimates - The preparation of financial statements in conformity with accounting principles
       generally accepted in the United States of America requires management to make certain estimates and
       assumptions that affect certain reported amounts of assets and liabilities and disclosure of any
       contingent assets and liabilities at the date of the financial statements and the reported amounts of
       revenue and expenses during the reporting period. Actual results could differ from such estimates and
       assumptions.




NOTE 3 - Initial Franchise Fee Revenue and Related Receivables

       A summary of initial franchise fees revenue for fiscal 2007 is as follows:

          Area franchises: Maryland - initial franchise fee
            store plus
             stores 2-7 through 6/30/2011                                                            $ 117,500
            Virginia - initial franchise fee store plus
             stores 2-5 through 6/27/2010                                                                87,500
            California - initial franchise fee store plus
             stores 2-5 through 6/27/2010                                                                87,500
          Other initial and royalty fees                                                                 62.576

                                                                                                 Total

          Less
                                              Franchise fee revenue collected during the fiscal year

                                                                       Balance receivable at July 31
                                                                                            Current

                 Long-term portion                                                                $ 135.000
                                          NOTES TO FINANCIAL STATEMENTS
                                                   (CONTINUED)




NOTE 3 - Initial Franchise Fee Revenue and Related Receivables - (Continued)

        During fiscal 2007, the Company entered into a franchise agreement with a franchise located in the state
        of Maryland. In Maryland the revenue from the sale of the area rights to a franchise is not collectable until
        a franchise location commences business; nevertheless, it is managements opinion that the revenue has
        been earned in the year the contract was signed considering all material costs related to obtain the
        contract sale have been incurred.




NOTE 4 - Related Party Transactions

        At July 31, 2007 and 2006, amounts due from (to) related parties is as follows:

                                                                                                   2007 2006

           Due from related parties:
            Faces Cosmetics pic                                                     $ 210,199 $210,199
            Faces Holdings, Inc.                                                        80.027 80.027

                 Total                                                              $ 290.226       S 290.226

          Amounts due from FHP and FHI consists of all reimbursable start-up costs, including market research,
          legal, salary and other costs incurred from the start of the Company's business until approximately
          July 31, 2006. Costs of this nature since that date, are included in administrative an operating expenses
          in the accompanying statements of operations for fiscal 2007.
                                 FACES COSMETICS USA, INC.




Due to related parties:
 Faces Cosmetics, Inc.                                              $ (835,618)     $ 351,682
 Faces Canada, Inc.                                                   ( 4.000) _______________

 Total                                                              S f 839.618) $351.682

Amounts due to FCI relate to the payments by FCI of almost all of the Company costs referred to above
and also for a significant portion of other general operating costs and management fees.

				
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