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The band was originally formed by pin-up Heyward (guitar, vocals), Les Nemes (bass), Tim Jenkins (guitar) and Rob Stroud (drums). Jenkins left quite early on when the band was unsigned. He was later followed by Stroud who joined the punk band The Sex Gang Children. Graham Jones left The Low Numbers to join the band, which at the time was named 'Moving England'. Stroud was replaced by Patrick Hunt on drums who played on their first single, "Favourite Shirts (Boy Meets Girl)". Hunt was fired and replaced by the American Blair Cunningham. Cunningham replaced the drum track on the album version of "Favourite Shirts (Boy Meets Girl)", although the single had the original drums played by Hunt. During their early gigs, Phil Smith and Mark Fox were drafted to play saxophone and percussion respectively. Originally meant to be session musicians, they were asked to join the line up of the band when they signed to Arista Records.

Haircut 100 appeared just as New Wave was peaking. They were quickly successful: their first single, 1981's "Favourite Shirts (Boy Meets Girl)" reached number four in the UK Singles Chart. Their next single, "Love Plus One", reached number three and broke the Top 40 in the United States. The following two singles "Fantastic Day" and "Nobody's Fool" each reached number nine in the UK.

Haircut 100 seemed poised for stardom, then Heyward left the band in January 1983 to pursue a solo career. Percussionist Marc Fox took Heyward's place as vocalist. In 1984, the band released the album Paint and Paint, but broke up soon after.

In 2004 all of the band's ex-members reunited for an episode of VH1's series Bands Reunited.

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