**Exhibit
      3.1**




**AMENDMENT
      TO ARTICLES OF INCORPORATION OF COST-U-LESS, INC.**




**ARTICLES
      OF AMENDMENT**




**PURSUANT
      TO RCW SECTION 23B.06.020**




Pursuant
      to RCW Section 23B.06.020, Cost-U-Less, Inc., a corporation organized and
      existing under the laws of the State of Washington, hereby states that the
      Designation of Rights and Preferences of Cumulative Preference Shares, First
      Series attached hereto as Exhibit A was duly adopted by the Board of Directors
      of the corporation on February 23, 1999.




These
      Articles of Amendment are executed by said corporation by its duly authorized
      officer.




DATED:
      March 15, 1999.




Cost
                U-Less, Inc.By
            /s/
                Alan C. YoungbergAllan
                C. Youngberg, Vice President-Chief Financial Officer, Secretary and
                Treasurer











**EXHIBIT
      A**




**DESIGNATION
      OF RIGHTS AND PREFERENCES**


**OF**


**CUMULATIVE
      PREFERENCE SHARES, FIRST SERIES**


**OF**


**COST-U-LESS,
      INC.**




A
      series
      of preferred shares shall be designated Cumulative Preference Shares, First
      Series (“First Series Preference Shares”). The number of shares and the
      preferences, limitations and relative rights of the First Series Preference
      Shares shall be as follows:




**1.**  **Number
      of Shares** **.**




The
      First
      Series Preference Shares shall initially consist of 100,000 shares; provided , however ,
      that,
      if more than a total of 100,000 shares of the First Series Preference Shares
      shall be issuable upon the exercise of Rights (the “Rights”) issued pursuant to
      the Rights Agreement dated as of March 15, 1999, between this corporation and
      ChaseMellon Shareholder Services, L.L.C., as Rights Agent (the “Rights
      Agreement”), the Board of Directors of this corporation shall direct by
      resolution that the total number of shares of the First Series Preference Shares
      authorized to be issued shall be increased (to the extent that the Articles
      then
      permit) to the largest number of whole shares (rounded up to the nearest whole
      number) issuable upon exercise of such Rights.




**2.**  **Dividends
      or Distributions** **.**




(a)  Subject
      to the prior and superior rights of the holders of shares of any other series
      of
      preferred stock or other class of capital stock of the corporation ranking
      prior
      and superior to the shares of the First Series Preference Shares with respect
      to
      dividends, the holders of shares of the First Series Preference Shares shall
      be
      entitled to receive, when, as and if declared by the Board of Directors, out
      of
      the assets of this corporation legally available therefor, (i) quarterly
      dividends payable in cash on the last day of each fiscal quarter in each year,
      or such other dates as the Board of Directors of this corporation shall approve
      (each such date being referred to in this Designation as a “Quarterly Dividend
      Payment Date”), commencing on the first Quarterly Dividend Payment Date after
      the first issuance of a share or a fraction of a share of the First Series
      Preference Shares, in an amount per share (rounded to the nearest cent) equal
      to
      the greater of (i) $.01 and (ii) the Formula Number (as hereinafter defined)
      then in effect times the cash dividends then to be paid on each share of Common
      stock. In addition, if this corporation shall pay any dividend or make any
      distribution on the Common Stock payable in assets, securities or other forms
      of
      noncash consideration (other than dividends or distributions solely in shares
      of
      Common Stock), then, in each such case, this corporation shall simultaneously
      pay or make on each outstanding whole share of the First Series Preference
      Shares a dividend or distribution in like kind equal to the Formula Number
      then
      in effect times such dividend or distribution on each share of the Common Stock.
      As used herein, the “Formula Number” shall be 100; provided , however ,
      that,
      if at any time after the Close of Business on March 15, 1999, this corporation
      shall (A) declare or pay any dividend on the Common Stock payable in shares
      of
      Common Stock or make any distribution on the Common Stock in shares of Common
      Stock, (B) subdivide (by a stock split or otherwise) the




outstanding
        shares of Common Stock into a larger number of shares of Common Stock, or
        (C)
        combine (by a reverse stock split or otherwise) the outstanding shares of
        Common
        Stock into a smaller number of shares of Common Stock, then in each such
        event
        the Formula Number shall be adjusted to a number determined by multiplying
        the
        Formula Number in effect immediately prior to such event by a fraction, the
        numerator of which is the number of shares of Common Stock that are outstanding
        immediately after such event and the denominator of which is the number of
        shares of Common Stock that are outstanding immediately prior to such event
        (and
        rounding the result to the nearest whole number); and provided , further ,
        that,
        if at any time after _______, this corporation shall issue any shares of
        its
        capital stock in a merger, reclassification, or change of the outstanding
        shares
        of Common Stock, then in each such event the Formula Number shall be
        appropriately adjusted to reflect such merger, reclassification or change
        so
        that each share of Preference Shares continues to be the economic equivalent
        of
        a Formula Number of shares of Common Stock prior to such merger,
        reclassification or change.




(b)  This
      corporation shall declare a dividend or distribution on the First Series
      Preference Shares as provided in Section 2(a) immediately prior to or at the
      same time it declares a dividend or distribution on the Common Stock (other
      than
      a dividend or distribution solely in shares of Common Stock); provided , however ,
      that,
      in the event no dividend or distribution (other than a dividend or distribution
      in shares of Common Stock) shall have been declared on the Common Stock during
      the period between any Quarterly Dividend Payment Date and the next subsequent
      Quarterly Dividend Payment Date, a dividend of $0.01 per share on the First
      Series Preference Shares shall nevertheless be payable on such subsequent
      Quarterly Dividend Payment Date. The Board of Directors may fix a record date
      for the determination of holders of shares of the First Series Preference Shares
      entitled to receive a dividend or distribution declared thereon, which record
      date shall be the same as the record date for any corresponding dividend or
      distribution on the Common Stock.




(c)  Dividends
      shall begin to accrue and be cumulative on outstanding shares of the First
      Series Preference Shares from and after the Quarterly Dividend Payment Date
      next
      preceding the date of original issue of such shares of the First Series
      Preference Shares; provided , however ,
      that
      dividends on such shares which are originally issued after the record date
      for
      the determination of holders of shares of the First Series Preference Shares
      entitled to receive a quarterly dividend and on or prior to the next succeeding
      Quarterly Dividend Payment Date shall begin to accrue and be cumulative from
      and
      after such Quarterly Dividend Payment Date. Notwithstanding the foregoing,
      dividends on shares of the First Series Preference Shares which are originally
      issued prior to the record date for the determination of holders of shares
      of
      the First Series Preference Shares entitled to receive a quarterly dividend
      on
      the first Quarterly Dividend Payment Date shall be calculated as if cumulative
      from and after the last day of the fiscal quarter next preceding the date of
      original issuance of such shares. Accrued but unpaid dividends shall not bear
      interest. Dividends paid on the shares of the First Series Preference Shares
      in
      an amount less than the total amount of such dividends at the time accrued
      and
      payable on such shares shall be allocated pro rata on a share-by-share basis
      among all such shares at the time outstanding.




(d)  So
      long
      as any shares of the First Series Preference Shares are outstanding, no
      dividends or other distributions shall be declared, paid or distributed, or
      set
      aside for payment or distribution, on the Common Stock unless, in each case,
      the
      dividend required by this Section 2 to be declared on the First Series
      Preference Shares shall have been declared.







(e)  The
      holders of the shares of the First Series Preference Shares shall not be
      entitled to receive any dividends or other distributions except as provided
      herein.




**3.**  **Voting
      Rights** **.**




The
      holders of shares of the First Series Preference Shares shall have the following
      voting rights:




(a)  Each
      holder of the First Series Preference Shares shall be entitled to a number
      of
      votes equal to the Formula Number then in effect, for each share of the First
      Series Preference Shares held of record on each matter on which holders of
      the
      Common Stock or shareholders generally are entitled to vote, multiplied by
      the
      maximum number of votes per share which any holder of the Common Stock or
      shareholders generally then have with respect to such matter (assuming any
      holding period or other requirement to vote a greater number of shares is
      satisfied).




(b)  Except
      as
      otherwise provided herein or by applicable law, the holders of shares of the
      First Series Preference Shares and the holders of shares of Common Stock shall
      vote together as one class for the election of directors of this corporation
      and
      on all other matters submitted to a vote of shareholders of this
      corporation.




(c)  Except
      as
      provided herein or by applicable law, holders of the First Series Preference
      Shares shall have no special voting rights and their consent shall not be
      required (except to the extent they are entitled to vote with holders of Common
      Stock as set forth herein) for authorizing or taking any corporate
      action.




**4.**  **Certain
      Restrictions** **.**




(a)  Whenever
      quarterly dividends or other dividends or distributions payable on the First
      Series Preference Shares as provided in Section 2 are in arrears, thereafter
      and
      until all accrued and unpaid dividends and distributions, whether or not
      declared, on shares of the First Series Preference Shares outstanding shall
      have
      been paid in full, this corporation shall not




(i)  declare
      or pay dividends on, make any other distributions on, or redeem or purchase
      or
      otherwise acquire for consideration any shares of stock ranking junior (either
      as to dividends or upon liquidation, dissolution or winding up) to the First
      Series Preference Shares;




(ii)  declare
      or pay dividends on or make any other distributions on any shares of stock
      ranking on a parity (either as to dividends or upon liquidation, dissolution
      or
      winding up) with the First Series Preference Shares, except dividends paid
      ratably on the First Series Preference Shares and all such parity stock on
      which
      dividends are payable or in arrears in proportion to the total amounts to which
      the holders of all such shares are then entitled;




(iii)  redeem
      or purchase or otherwise acquire for consideration shares of any stock ranking
      junior (either as to dividends or upon liquidation, dissolution or winding
      up)
      with the First Series Preference Shares; provided that this corporation may
      at
      any time redeem, purchase or otherwise acquire shares of any such junior stock
      in exchange for shares of any stock





of
        this
        corporation ranking junior (either as to dividends or upon dissolution,
        liquidation or winding up) to the First Series Preference Shares;
        or




(iv)  purchase
      or otherwise acquire for consideration any shares of the First Series Preference
      Shares, or any shares of stock ranking on a parity with the First Series
      Preference Shares, except in accordance with a purchase offer made in writing
      or
      by publication (as determined by the Board of Directors) to all holders of
      such
      shares upon such terms as the Board of Directors, after consideration of the
      respective annual dividend rates and other relative rights and preferences
      of
      the respective series and classes, shall determine in good faith will result
      in
      fair and equitable treatment among the respective series or
      classes.




(b)  This
      corporation shall not permit any subsidiary of this corporation to purchase
      or
      otherwise acquire for consideration any shares of stock of this corporation
      unless this corporation could, under this Section 4, purchase or otherwise
      acquire such shares at such time and in such manner.




**5.**  **Liquidation
      Rights** **.**




In
      the
      event of voluntary or involuntary liquidation, dissolution or winding up of
      this
      corporation, no distribution shall be made (a) to the holders of shares of
      stock
      ranking junior (either as to dividends or upon liquidation, dissolution or
      winding up) to the First Series Preference Shares unless, prior thereto, the
      holders of shares of the First Series Preference Shares shall have received
      an
      amount equal to the greater of (i) $.01 per share and (ii) the accrued and
      umpaid dividends and distributions thereon, whether or not declared, to the
      date
      of such payment, plus an aggregate amount per share equal to the Formula Number
      then in effect times the aggregate amount to be distributed per share to holders
      of Common Stock or (b) to the holders of stock ranking on a parity (either
      as to
      dividends or upon liquidation, dissolution or winding up) with the First Series
      Preference Shares, except distributions made ratably on the First Series
      Preference Shares and all other such parity stock in proportion to the total
      amounts to which the holders of all such shares are entitled upon such
      liquidation, dissolution or winding up.




**6.**  **Consolidation;
      Merger; etc** **.**




In
      case
      this corporation shall enter into any consolidation, merger, combination or
      other transaction in which the shares of Common Stock are exchanged for or
      changed into other stock or securities, cash or any other property, then in
      any
      such case the then outstanding shares of the First Series Preference Shares
      shall at the same time be similarly exchanged or changed into an amount per
      share equal to the Formula Number then in effect times the aggregate amount
      of
      stock, securities, cash or any other property (payable in kind), as the case
      may
      be, into which or for which each share of Common Stock is exchanged or changed.
      In the event both this Section 6 and Section 2 appear to apply to a transaction,
      this Section 6 will control.




**7.**  **No
      Redemption; No Sinking Fund** **.**




(a)  The
      shares of the First Series Preference Shares shall not be subject to redemption
      by this corporation or at the option of any holder of the First Series
      Preference Shares; provided , however ,
      that
      this corporation may purchase or otherwise acquire outstanding







shares
      of
      the First Series Preference Shares in the open market or by offer to any holder
      or holders of shares of the First Series Preference Shares.




(b)  The
      shares of the First Series Preference Shares shall not be subject to or entitled
      to the operation of a retirement or sinking fund.




**8.**  **Ranking** **.**




The
      First
      Series Preference Shares shall rank junior to all series of Preferred Shares
      of
      this corporation and to all other series of Preference Shares of this
      corporation, unless the Board of Directors shall specifically determine
      otherwise in fixing the preferences, limitations and relative rights of the
      shares of any such series of Preferred Shares or Preference Shares.




**9.**  **Fractional
      Shares** **.**




The
      First
      Series Preference Shares shall be issuable upon exercise of the Rights issued
      pursuant to the Rights Agreement in whole shares or in any fraction of a share
      that is one one-hundredth of a share or any integral multiple of such fraction
      which shall entitle the holder, in proportion to such holder’s fractional
      shares, to receive dividends, exercise voting rights, participate in
      distributions and to have the benefit of all other rights of holders of the
      First Series Preference Shares. In lieu of fractional shares, this corporation,
      prior to the first issuance of a share or a fraction of a share of the First
      Series Preference Shares, may elect (i) to make a cash payment as provided
      in
      the Rights Agreement for fractions of a share other than one one-hundredths
      of a
      share or any integral multiple thereof or (ii) to issue depository receipts
      evidencing such authorized fraction of a share of the First Series Preference
      Shares pursuant to an appropriate agreement between this corporation and a
      depository selected by this corporation; provided that
      such agreement shall provide that the holders of such depository receipts shall
      have all the rights, privileges and preferences to which they are entitled
      as
      holders of the First Series Preference Shares.




**10.**  **Reacquired
      Shares** **.**




Any
      shares of the First Series Preference Shares purchased or otherwise acquired
      by
      this corporation in any manner whatsoever shall be retired and canceled promptly
      after the acquisition thereof. All such shares shall upon their cancellation
      become authorized but unissued shares of Preference Shares, without designation
      as to series until such shares are once more designated as part of a particular
      series by the Board of Directors pursuant to the provisions of the
      Articles.




**11.**  **Amendment** **.**




None
      of
      the powers, preferences and relative, participating, optional and other special
      rights of the First Series Preference Shares as provided herein shall be amended
      in any manner which would alter or change the preferences or rights of the
      holders of the First Series Preference Shares so as to affect them adversely
      without the affirmative vote of the holders of at least 66-2/3% of the
      outstanding shares of the First Series Preference Shares, voting as a separate
      class.