AutoCoded Document







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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








DATED JULY 11, 2005











COST-U-LESS
CAYMAN HOLDINGS




AND




CAYMAN
DRUG LIMITED




AND




CAYMAN COST-U-LESS
LIMITED




AND




NAUL
BODDEN and ROBERT BODDEN











________________________________


SHAREHOLDERS AGREEMENT
________________________________











***CONFIDENTIAL
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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









CONTENTS


	 	 	Recitals	 	4	 
	 
	1.	 	Definitions and Interpretation	 	5	 
	2.	 	The Company	 	10	 
	3.	 	First Closing	 	11	 
	4.	 	Share Capital and Financing	 	12	 
	5.	 	Obligations between First Closing and Second Closing	 	12	 
	6.	 	Conditions to Second Closing	 	13	 
	7.	 	Second Closing	 	14	 
	8.	 	Intellectual Property Matters	 	15	 
	9.	 	Representations and Warranties	 	16	 
	10.	 	CULS Call Option	 	18	 
	11.	 	Cayman Drug Put Option	 	19	 
	12.	 	Buy Out Price	 	20	 
	13.	 	CULS Drag Along Right	 	20	 
	14.	 	Company Sale	 	21	 
	15.	 	Dividends and other Distributions	 	21	 
	16.	 	Buy Out Events and Sell Out Events	 	21	 
	17.	 	Restrictive Covenants	 	23	 
	18.	 	No Conflict	 	23	 
	19.	 	Provision of Financial Statements	 	24	 
	20.	 	Annual Audit	 	24	 
	21.	 	Confidentiality	 	25	 
	22.	 	Guarantee	 	26	 
	23.	 	Supremacy of this Agreement	 	26	 
	24.	 	Costs	 	26	 
	25.	 	No Partnership or Agency	 	26	 
	26.	 	Entire Agreement	 	26	 
	27.	 	Mutual consultation and goodwill	 	27	 
	28.	 	Notices	 	27	 
	29.	 	Assignment	 	28	 















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	30.	 	Waiver	 	28	 
	31.	 	Survival and validity	 	29	 
	32.	 	Termination Right	 	29	 
	33.	 	Authority of NB and RB	 	29	 
	34.	 	Governing Law, etc.	 	30	 
	35.	 	Counterparts	 	30	 
	36.	 	No Inferences	 	30	 








THE SCHEDULES


		
		
	1.	 	Memorandum and Articles of Association of the Company	 
	2.	 	Management Services Agreement	 
	3.	 	Financial Statements	 
	4.	 	Loan and Security Agreements	 

















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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









THIS
SHAREHOLDERS AGREEMENT is made on July 11, 2005




BETWEEN:



	(1)	 	
Cost-U-Less Cayman Holdings, an exempted company incorporated
under the laws of the Cayman Islands having its registered office at the offices
of M&C Corporate Services Limited, PO Box 309GT, Ugland House, South Church
Street, George Town, Grand Cayman, Cayman Islands (“CULS”);







	(2)	 	
Cayman Drug Limited, a company incorporated in the Cayman Islands and
having its registered office at the offices of Close Trustees (Cayman) Limited,
P.O. Box 1034GT, Harbour Place, 103 South Church Street, George Town, Grand
Cayman, Cayman Islands ("Cayman Drug");








	(3)	 	
Cayman Cost-U-Less Limited, a company incorporated under the laws of the
Cayman Islands having its registered office at the offices of M&C Corporate
Services Limited, PO Box 309GT, Ugland House, South Church Street, George Town,
Grand Cayman, Cayman Islands (the “Company”);







	(4)	 	
Naul Bodden of c/o NCB Consulting Ltd, PO Box 1168 GT, Grand Cayman,
Cayman Islands (“NB”); and







	(5)	 	
Robert Bodden of c/o NCB Consulting Ltd, PO Box 1168 GT, Grand Cayman,
Cayman Islands (“RB”).








WHEREAS:



	(A)	 	
The parties have formed the Company as a new company to be jointly-owned by CULS
and Cayman Drug to own and operate one Cost-U-Less retail and wholesale store in
the Cayman Islands.







4











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	(B)	 	
The Company has obtained such licences as are required under Cayman Islands law
(other than a Pharmacy Licence) for CULS to beneficially own 60 per cent of the
Company and for the Company to carry on its proposed retail and wholesale
business.







	(C)	 	
The parties intend that for a 60 per cent interest in the Company, CULS shall
contribute US$600 at First Closing and an
additional *(REDACTED) at Second Closing (if it occurs).







	(D)	 	 The
parties intend that Cayman Drug will contribute US$400 at First Closing and  *(REDACTED) at
Second Closing (if it occurs).







	(E)	 	 *(REDACTED)







	(F)	 	 *(REDACTED)







	(G)	 	
RB has contracted to acquire, through a development company which he controls,
leasehold title to the land on which the parties intend to locate the
Company’s proposed store.







	(H)	 	
The parties intend that the Company or RB shall construct or procure the
construction of the proposed store on such land, and that the Company will enter
into a long-term lease of the Store or, if the Company is responsible for
developing the Store, the Site with RB’s development company.







	(I)	 	
The parties are entering into this Agreement to set out the terms governing
their relationship as direct or indirect shareholders in the Company; and the
Company has joined in this Agreement for the purposes of confirming its
compliance with the parties’ agreements in relation to it.







NOW IT IS AGREED as follows:




	1   	 	Definitions
and Interpretation







	1.1	 	
In this Agreement, including the Schedules, the following words and expressions
shall have the meanings set opposite them respectively, unless the context
otherwise requires:







5











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	 	*(REDACTED);








	 	 	“Affiliate” means
in relation to any company, a person who, directly or indirectly,  controls, is
controlled by, or is under common control with such company;







	 	 	“Board” means
the Board of Directors of the Company;








	 	 	“Bodden
Account” means such account as Cayman Drug may notify in writing to  CULS and/or
the Company from time to time;







	 	 	“Business
Day” means a day (not being a Saturday or Sunday) on which the banks  are open
for business in the State of Washington, U.S.A and in the Cayman  Islands;







	 	 	“Buy
Out Date” means the fifth anniversary of the date of this Agreement and  every
successive anniversary thereof (and in each such case includes the 20  Business Days
immediately following such date);







	 	 	“Buy Out
Event” means any of the events listed in Clause 16.1;








	 	 	“Buy Out
Price” means the price calculated in accordance with Clause 12;








	 	 	“Call Exercise
Date” has the meaning given in Clause 10.1;








	 	 	“Call Notice”
has the meaning given in Clause 10.1;








	 	 	“Call Option”
has the meaning given in Clause 10.1;








	 	 	“Call Shares”
has the meaning given in Clause 10.1;








	 	 	“Cayman
Drug Business” means the pharmacy licence held by Cayman Drug, all the  books
and records of Cayman Drug relating to the business carried on by it  (including, without
limitation, all pharmacy lists) and any other assets of  Cayman Drug (including, without
limitation, any inventory) nominated by CULS  prior to Second Closing other than any cash
in hand or at bank;







	 	 	“CD Premium”
has the meaning given in Clause 3;







6











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	 	“Class
A Shares” means voting preference shares of a nominal or par value of $1.00
each in the capital of the Company;







	 	 	“Class
B Shares” means non-voting ordinary shares of a nominal or par value of $1.00
each in the capital of the Company;







	 	 	“CULS Parent”
means Cost-U-Less, Inc., the ultimate parent company of CULS;








	 	 	“CULS Premium”
has the meaning given in Clause 3;








	 	 	“Directors” means
the directors, or the sole director, for the time being of the Company;








	 	 	“Distribution
Date” shall mean the last Business Day in each financial quarter of  CULS Parent
or such other dates as CULS and Cayman Drug may agree from time to  time;







	 	 	“Drag Along
Date” has the meaning given in Clause 13.1;








	 	 	“Drag Along
Notice” has the meaning given in Clause 13.1;








	 	 	“Drag Along
Shares” has the meaning given in Clause 13.1;








	 	 	“Existing CD
Shares” has the meaning given in Clause 2.2;








	 	 	“First
Closing” means completion of the subscription by CULS for 600 Class A  Shares
and 400 Class B Shares respectively in accordance with Clause 3 of this  Agreement;







	 	 	“Financial Statements”
means the financial statements of Cayman Drug in the form attached as Schedule 3;








	 	 	“Inventory” means
the inventory, equipment and other items which may be contributed to the  Company by CULS
under this Agreement;







	 	 	“Lease” has
the meaning given in Clause 5.2;







7











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	 	“Loan
and Security Agreements” the loan and security agreements in a form  similar to
the form attached as Schedule 4;







	 	 	“Management
Services Agreement” means the agreement to be entered into between the  Company
and CULS for the provision of management services and the licensing of  certain
intellectual property rights to the Company, an agreed final draft of  which is attached
as Schedule 2;







	 	 	“Memorandum” and
“Articles” means the Memorandum and Articles of Association of the Company;








	 	 	“Pharmacy
Licence” means a licence to operate a retail pharmacy business granted  pursuant
to The Pharmacy Law 1991 of the Cayman Islands;







	 	 	“Put Exercise
Date” has the meaning given in Clause 11.1;








	 	 	“Put Notice”
has the meaning given in Clause 11.1;








	 	 	“Put Option”
has the meaning given in Clause 11.1;








	 	 	“Put Shares”
has the meaning given in Clause 11.1;








	 	 	“Register
of  Members” means the register of members of the Company;








	 	 	“Registered Office”
means the registered office for the time being of the Company;








		 	“Second
Closing” means the paying up of the CULS Premium and, if applicable,  the *(REDACTED) and
of the CD Premium by Cayman Drug in  accordance with Clause 7 on the Second Closing Date;







	 	 	“Second
Closing Date” means the date on which the Store opens for business to  the
public or, if later, the date five Business Days after the date on which all  the
conditions to Second Closing have been satisfied or waived, or such other  date as the
parties may agree;







	 	 	“Sell Out
Event” means any of the events listed in Clause 16.2;







8











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	“Share” and
“Shares” means Class A Shares and/or Class B Shares, as the  context may
require, and includes a fraction of a Share; 







	 	“Shareholder” means
each of CULS and Cayman Drug; 








	 	“Site” means
the proposed location of the Store in Grand Cayman, being at West Bay  Beach North, Block
11D, Parcel 4/1/5; 







	 	“Statute” means
the Companies Law (2004 Revision) of the Cayman Islands and every  modification or
re-enactment thereof for the time being in force; 







	 	“Store” means
the proposed Cost-U-Less warehouse store to be constructed on the Site; 








	 	“written” and
“in writing” import all methods of representing,  reproducing or
communicating words or numerals in permanent visible form,  including printing,
lithography, photography, telecopying and telexing; and 







	 	
“year” means
calendar year. 







	1.2	In
this Agreement where the context permits:






		(a)	References
to “US$” or “US dollars” are to the  currency of the
United States of America unless otherwise specified;






		(b)	words
importing the singular number include the plural and vice versa;






		(c)	words
importing the masculine gender include the feminine gender and vice versa;






		(d)	words
importing persons include companies or associations or bodies of persons,  corporate or
unincorporate;






		(e)	references
to the “parties” are to the parties to this  Agreement;






		(f)	the
word “may” is permissive; the word “shall” is
imperative;






9











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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








		(g) 	references
to documents or agreements in “agreed form” means as agreed by the
Shareholders at the date of this Agreement;






		(h)	a
reference to a statutory provision shall be deemed to include any amendment or
re-enactment thereof; and






		(i) 	references
to  Schedules are to the Schedules to this Agreement.






	1.3 	 The
headings in this Agreement are for ease of reference only and shall not  affect  its
construction or interpretation.






	2	The
Company






	2.1	The parties acknowledge and agree that the Company has the following  characteristics at the
date hereof:






		(a)	the
Company is a Cayman Islands ordinary resident company limited by shares;






		(b)	the
Memorandum and Articles of the Company are in the agreed form set out in  Schedule 1;






		(c)	the
Company has an authorised share capital of US$50,000 divided into 50,000  Shares of a
nominal or par value of US$1.00 each, which Shares may be issued as  Class A Shares or
Class B Shares;






		(d)	the
Registered Office of the Company is at the offices of M&C Corporate  Services
Limited, PO Box 309GT, George Town, Grand Cayman, Cayman Islands;






		(e)	the
name of the Company is “Cayman Cost-U-Less Limited”; and






		(f)	the
Company holds (i) a licence under the Local Companies (Control) Law (1999  Revision)
permitting CULS to own at least 60% of the issued share capital of the  Company and (ii)
a licence under the Trade and Business Licensing Law (2003  Revision) permitting it to
carry on a wholesale and retail business at the Site.






10











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ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	2.2	The
parties acknowledge that prior to the date of this Agreement the Company has  issued only
two shares, one registered in the name of RB, the second registered  in the name of NB
(the “Existing CD Shares”).






	3	First
Closing






	 	First
Closing  shall take place at the offices of Maples and Calder, Ugland House,  South
Church Street,  George Town, Grand Cayman, Cayman Islands immediately after  the parties
have entered  into this Agreement. At First Closing: 







		(a)	The
Existing CD Shares shall be designated by a resolution of the Board as Class  B Shares
and shall be transferred by RB and NB to Cayman Drug.






		(b)	CULS
shall subscribe unconditionally for 600 Class A Shares at an aggregate subscription
price of *(REDACTED), the nominal value of which (being US$600) shall be paid up in cash
at First Closing and the remainder (being the “CULS Premium”) shall be paid up
at Second Closing (the conditions to Second Closing having been satisfied or waived) in
accordance with Clause 7;






		(c)	
Cayman Drug shall subscribe unconditionally for 398 Class B Shares, which will
result in Cayman Drug holding 400 Class B Shares in aggregate at an aggregate
subscription price of *(REDACTED), the nominal value of
which (being US$400) shall be paid up in cash at or before First Closing and the
remainder (the “CD Premium”) shall be paid up at Second Closing
(the conditions to Second Closing having been satisfied or waived) in accordance
with Clause 7;







		(d)	
The parties shall procure that the Company allots and issues credited as fully
paid, sufficient Class A Shares and Class B Shares such that immediately
following First Closing the shareholdings recorded in the Register of Members of
the Company shall be as follows:







	 	(i) 	 600
Class A Shares will be registered in the name of CULS; and







	 	(ii) 	 400
Class B Shares to will be registered in the name of Cayman Drug; and







11











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
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SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








		(e)	the parties shall procure that all necessary resolutions of the Company or the  Board are
passed such that immediately following First Closing, there shall be  three directors of
the Company who shall be those nominated by CULS, two of whom  as A Directors and one of
whom as the B Director, in accordance with and as  defined in the Articles.







	4	Share capital and financing






	4.1	The Company shall, in accordance with and following completion of the events and
transactions referred to in Clause 3, have paid up share capital of US$1,000.  The Company’s
issued shares will, immediately following First Closing,  consist of 600 Class A Shares
owned by CULS and 400 Class B Shares owned by  Cayman Drug, all of a nominal or par value
of US$1.00 each.






	4.2	For the avoidance of doubt, if Second Closing does not take place in accordance  with this
Agreement neither the CULS Premium, the  *(REDACTED) nor the CD
Premium shall become payable.






	4.3	The Company shall be free to obtain financing from third party lenders or either  shareholder
on such terms as its directors deem appropriate, which will be based  on terms that the
Company could obtain from a third party lender on an  unguaranteed basis and, in the case
of CULS, may be pursuant to a loan and  security agreement similar to the terms of the
Loan and Security Agreements  (which will be adjusted to incorporate the terms that the
Company could obtain  from a third party lender on an unguaranteed basis).







	5	Obligations
between First Closing and Second Closing






	5.1	Cayman
Drug undertakes that between First Closing and Second Closing it will  continue to
operate its business in the ordinary course as such business is  currently carried on at
the date of this Agreement, and in particular it will  not:






		(i) 	take
any action that might reasonably be expected to result in a revocation or  impairment of
Cayman Drug’s Pharmacy Licence; or






		(ii) 	take
any action that might reasonably be expected to have a material adverse  effect on the
goodwill or profitability of its business.





12










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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	5.2	RB
and the Company shall negotiate the terms of a long-term lease of the Store  or, if CULS
has agreed that the Company shall develop the Store, the Site (the  “Lease”),
which lease shall be on terms acceptable to CULS and  any relevant third party provider
of finance to CULS, the Company or any of  their Affiliates. If the Lease is a lease of
the Site only, the Lease shall also  contain a right of first refusal in favour of RB, in
the event that the Company  decides to sell the Store, on terms reasonably acceptable to
RB. Upon agreement  by RB, the Company and CULS of the terms of the Lease, RB shall
procure that the  leasehold owner of the Site enters into the Lease.






	5.3	RB
shall procure that all required planning permissions or other regulatory  consents are
obtained to enable the Store to be constructed.






	5.4	Either
RB will procure the building of the Store, or, if RB elects not to build  the Store, *(REDACTED) pursuant
to Clause 5.6 and CULS  having given its consent, the Company shall procure the building
of the Store.






	5.5	*(REDACTED)








		(i) 	*(REDACTED)







		(ii) 	*(REDACTED)






	5.6	Subject
to the consents referred to in Clause 5.5 having been obtained,  *(REDACTED), the
nominal value of which  *(REDACTED) shall be paid up at the time of
issue and the  remainder *(REDACTED) shall be paid up at Second
Closing  (the conditions to Second Closing having been satisfied or waived) in accordance
with Clause 7. *(REDACTED)






	5.7	RB,
NB and Cayman Drug shall promptly make available such documentation and  other materials
as CULS or the Company may reasonably request to fulfil their  due diligence requirements
in connection with the Company’s negotiation of  the Lease and their proposed
acquisitions of the Cayman Drug Business at Second  Closing.






	6	Conditions
to Second Closing






	6.1	Second
Closing shall be conditional on:






		(a)	agreement
and entry into the Lease in accordance with Clause 5.2;






		(b)	all
planning permissions or other regulatory consents required to permit the  construction of
the Store (in a form reasonably satisfactory to CULS) by or on  behalf of the Company
having been obtained;





13












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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








		(c)	the
Store having been constructed (in a form reasonably satisfactory to CULS)  and being in a
fit condition to open to the public;






		(d)	the
undertakings set out in Clause 5.1 not having been breached;






		(e)	all
necessary regulatory consents having been obtained for the transfer of the  Cayman Drug
Business to CULS and then to the Company with effect from Second  Closing (including the
transfer of the Pharmacy Licence held by Cayman Drug to  the Company, on behalf of CULS
and itself, or the grant of a new Pharmacy  Licence to the Company at the expense of
Cayman Drug, in either case permitting  the Company to carry on a retail pharmacy
business at the Store) on terms and  conditions satisfactory to CULS;






		(f)	*(REDACTED) having
been issued by the Company to CULS pursuant to Clause 5.6 or *(REDACTED); and






		(g)	the
Management Services Agreement shall have been entered into  by the parties  thereto. 






	6.2	The conditions to Second Closing set out in Clause 6.1 may  only be  waived  by the written
consent of each of the parties, except  that the conditions set out in Clauses 6.1(d),
(e), (f) and (g) may be waived by  the sole written consent of CULS.







	7	Second
Closing






	7.1	Second Closing shall take place on the Second Closing Date. At Second Closing:






		(a)	Cayman
Drug shall transfer the Cayman Drug Business to CULS in consideration of  the payment by
CULS to Cayman Drug of *(REDACTED) in cash;






		(b)	Cayman
Drug shall pay up the CD Premium by the payment of *(REDACTED) in cash to the
Company;  and




		(c)	CULS
shall pay up the CULS Premium *(REDACTED) by (i) transfer to the Company of the
Cayman  Drug Business, which for such purposes shall be valued at *(REDACTED),
and, as to any  additional amount by (ii) physical or constructive delivery to the
Company of  Inventory, which for such purposes shall be valued at its cost to CULS or, if
CULS so  elects, by payment in cash or by capitalisation of all or part of any
outstanding debt  owed by the Company to CULS.






14











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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	7.2	Any
amount contributed to the Company by CULS pursuant to Clause 7.1(c) in  excess of the
amount of CULS Premium *(REDACTED), payable  by it at Second Closing
shall represent a loan by CULS to the Company on terms  no less favourable to the Company
than the terms on which such financing could  have been obtained by the Company from a
third party lender on an unguaranteed  basis.






	7.3	Transfers
of the Cayman Drug Business pursuant to Clause 7.1 shall be made by  actual or
constructive delivery of the relevant assets to the extent possible,  and otherwise by
execution of the appropriate instruments of transfer by the  transferor and/or transferee
in each case. Where any required consent to any  such transfer has not been granted, the
relevant assets and any moneys generated  by or received in respect of such assets, shall
be held on trust by the  transferor for the transferee pending the granting of such
consent in each case.






	7.4	Acknowledging
that no liabilities in respect of the Cayman Drug Business are  intended to be
transferred to CULS or the Company pursuant to this Agreement,  Cayman Drug hereby
undertakes to indemnify CULS and the Company for any  liability incurred by either such
party in respect of the Cayman Drug Business  which (i) relates to any period prior to
Second Closing, and/or (ii) is  transferred to CULS or the Company at Second Closing on
transfer of the Cayman  Drug Business by operation of law or otherwise.






	7.5	For
the avoidance of doubt, the parties intend that the Store shall open for  business to the
public on the earliest practicable date upon each of the  conditions set out in Clause
6.1, other than Clause 6.1(d) and (e), having been  satisfied or waived, and that the
opening of the Store shall not be delayed by  the non-satisfaction or non-waiver of the
conditions set out in Clause 6.1(d)  and (e). Second Closing shall only take place on the
Second Closing Date when  and if such date is reached.







	8	Intellectual
Property Matters






	8.1	The
parties acknowledge that, with effect from First Closing, CULS Parent will  grant to the
Company a licence to use certain intellectual property on the terms  set out in the
Management Agreement.






	8.2	If
any party to this Agreement shall cease to be a shareholder in the Company,  and the
corporate name of the Company or any part of it contains any word or  words the same as 







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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	or
similar  to the corporate name or any distinctive part of  the corporate name of that
shareholder  (the “Relevant  Wording”), the remaining shareholders shall
procure  that:







		(a)	within
30 days of such party ceasing to be a shareholder the corporate name  shall be changed so
as to exclude the Relevant Wording;  and






		(b)	within
90 days of such party ceasing to be a shareholder the Relevant Wording  shall be removed
from all signage, publicity materials or other materials of the  Company  and shall cease
to be used in any way in connection with the business of  the Company.







	9	Representations
and Warranties






	9.1	Each
Shareholder hereby represents and warrants as at the date of this  Agreement, that the
execution, delivery and performance by such Shareholder of  this Agreement are within the
powers of such Shareholder, have been duly  authorized and will not constitute or result
in a breach or default under, or  conflict with, any order, ruling or regulation of any
court or other tribunal or  of any governmental commission or agency, or any agreement or
other undertaking,  to which such Shareholder is a party or by which such Shareholder is
bound, and  will not violate any provisions of the incorporation documents, by-laws or
similar documents or instruments, as may be applicable, of such Shareholder.  Such
Shareholder has obtained all consents required to be obtained and complied  with all
legal requirements necessary to be complied with in order for this  Agreement or the
issuance of the Shares to be lawful and valid under the laws of  any jurisdiction to
which such Shareholder is subject.






	9.2	CULS
agrees to represent and warrant as at Second Closing that it has good legal  and
beneficial title to any Inventory contributed to the Company pursuant to  Clause 7.1(c).






	9.3	NB
and RB agree to represent and warrant as at First Closing and Second Closing  to CULS and
the Company that together they have good legal and beneficial title  to all the issued
shares of Cayman Drug, which are not encumbered in any manner.






	9.4	Cayman
Drug, RB and NB agree to represent and warrant as at First Closing and  Second Closing to
CULS and the Company that:







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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









		(a)	Cayman
Drug has good legal and beneficial title to all the assets of the Cayman  Drug Business,
which are not encumbered in any manner and there are no  encumbrances or security
interests of any sort over any of Cayman Drug’s  assets or undertaking;






		(b)	Cayman
Drug is an ordinary limited liability company, duly incorporated and in  good standing in
the Cayman Islands, the books and records of which have been  duly maintained and are up
to date;






		(c)	the
Financial Statements present a reasonable view of the financial state of  Cayman Drug and
its business as at the date of, or period covered by, such  Financial Statements and are
not misleading;






		(d)	Cayman
Drug has not incurred any indebtedness in the nature of borrowings that  has not been
repaid in full, nor has it advanced any loan that has not been  repaid in full, nor has
it entered into any agreement to incur any indebtedness  or advance any loan;






		(e)	Cayman
Drug has at all times conducted its business materially in accordance  with all
applicable laws and regulations;






		(f)	Cayman
Drug is not involved as claimant or defendant or otherwise in any  litigation,
arbitration or administrative proceedings and no such proceedings  are pending or
threatened.






	9.5	Cayman
Drug, RB and NB agree to warrant and represent at Second Closing to CULS  and the Company
that all necessary regulatory and other consents have been  obtained for the transfer of
the Cayman Drug Business to the Company.






	9.6	RB
agrees (i) to warrant and represent at First Closing to CULS and the Company  that he, or
a company under his control, has the absolute unconditional right to  acquire good
leasehold title to the Site with a term not less that 40 years, and  (ii) to warrant and
represent at Second Closing to CULS and the Company that he,  or a company under his
control, has good leasehold title to the Site with a term  not less that 40 years.





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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	10	CULS
Call Option






	10.1	CULS
shall have the option to purchase all the Shares held by Cayman Drug (the  “Call
Shares”) at the Buy Out Price on any Buy Out Date or at  any time upon the
occurrence of a Buy Out Event (the “Call  Option”). CULS may exercise
the Call Option by delivering a written  notice to Cayman Drug and the Company (the “Call
Notice”) at  least 20 Business Days prior to any Buy Out Date, if exercised in
relation to a  Buy Out Date, or at any time, if exercised in relation to a Buy Out Event,
specifying the date on which the Call Option will be exercised (being a date at  least 20
Business Days after the date of the Call Notice and not earlier than  the relevant Buy
Out Date, if delivered in relation to a Buy Out Date) (the  “Call Exercise  Date”).






	10.2	The
parties shall co-operate and take all reasonable steps to obtain any legal  or regulatory
consent required for CULS to purchase all the Shares held by  Cayman Drug pursuant to the
Call Option, including, without limitation, any  required amendment to the licence held
by the Company under the Local Companies  (Control) Law (1999 Revision). The Call
Exercise Date may be delayed for a  period of up to six months whilst such consents are
sought. If any necessary  consent is not obtained within such six month period, then at
the option of CULS  either (i) the Call Notice shall lapse, but without prejudice to the
right of  CULS to deliver further Call Notices in relation to the same or subsequent Buy
Out Dates or Buy Out Events or (ii) CULS may require Cayman Drug to transfer the  Shares
subject to the Call Option to any person designated by CULS where such  transfer does not
require any legal or regulatory consent or such consent has  been obtained (and Cayman
Drug agrees to co-operate in obtaining any required  consent to such transfer).






	10.3	On
the Call Exercise Date, CULS shall pay the Buy Out Price to Cayman Drug by  wire transfer
to the Bodden Account. The Company shall forthwith update the  Register of Members to
show CULS as the holder of the Call Shares, and in so  doing shall be entitled to rely
solely upon the copy of the Call Notice  delivered to it pursuant to this Clause 10.
Cayman Drug shall promptly surrender  to the Company for cancellation any share
certificate representing Call Shares  transferred pursuant to this






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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	 	Clause
10. Cayman Drug  shall also execute a release  of any existing and future claims  against
CULS in the form  provided by CULS,  which will release CULS and its Affiliates.









	11	Cayman
Drug Put Option






	11.1	Cayman
Drug shall have the option to sell all its Shares (the “Put  Shares”) to
CULS at the Buy Out Price on the occurrence of a Sell Out  Event (the “Put Option”).
Cayman Drug may exercise the Put  Option by delivering a written notice to CULS and the
Company (the “Put  Notice”) specifying the date (being a date at least
20 Business Days  after the date of the Put Notice) on which the Put Option will be
exercised (the  “Put Exercise Date”).






	11.2	The
parties shall co-operate and take all reasonable steps to obtain any legal  or regulatory
consent required for CULS to purchase all the Shares held by  Cayman Drug pursuant to the
Put Option, including, without limitation, any  required amendment to the licence held by
the Company under the Local Companies  (Control) Law (1999 Revision). The Put Exercise
Date may be delayed for a period  of up to six months whilst such consents are sought. If
any necessary consent is  not obtained within such six month period, the Put Notice shall
lapse.






	11.3	On
the Put Exercise Date, CULS shall pay the Buy Out Price to Cayman Drug by  wire transfer
to the Bodden Account PROVIDED THAT if the Buy Out Price is equal  to or greater than
$200,000, CULS may elect to pay the Buy Out Price in five  equal annual instalments
(together with an amount of interest accrued up to the  date of each such instalment on
the then unpaid portion of the Buy Out Price at  a rate of interest equal to the most
favourable rate at which CULS Parent could  borrow such outstanding amount from third
party lenders on the first day of such  annual period), with the first such instalment
being payable on the Put Exercise  Date and subsequent instalments being payable on the
anniversary thereof. The  Company shall forthwith update the Register of Members to show
CULS as the  holder of the Put Shares, and in so doing shall be entitled to rely solely
upon  the copy of the Put Notice delivered to it pursuant to this Clause 11. Cayman  Drug
shall promptly surrender to the Company






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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	for
cancellation  any share  certificate  representing Put Shares transferred pursuant to
this  Clause 11.  Cayman Drug shall also  execute a release of any existing and future
claims  against CULS  in the form provided by  CULS, which will release CULS and its
Affiliates.








	12	Buy
Out Price







	 	The
Buy Out Price shall be an amount *(REDACTED), as set out in such accounts or extracted
therefrom by the Company’s auditors, as calculated in accordance with U.S.
generally accepted accounting principles as they are applied to CULS Parent by its
auditors.








	13	CULS
Drag Along Right






	13.1	If
a third party offers to acquire all of the Shares held by CULS and CULS  intends to
accept such offer, CULS may deliver a written notice to Cayman Drug  and the Company
setting out reasonable details of such third party offer,  including the proposed
transfer date and consideration (the “Drag Along  Notice”) requiring
Cayman Drug to sell its Shares (the “Drag  Along  Shares”) to the
third party at the same time and on the  same terms. The date of such proposed transfer
(the “Drag Along  Date”) shall be at least 20 Business Days after the
date of the Drag Along  Notice.






	13.2	On
the Drag Along Date, CULS shall procure payment by the third party of the  consideration
set out in the Drag Along Notice to Cayman Drug by wire transfer  to the Bodden Account.
The Company shall forthwith update the Register of  Members to show the third party as
the holder of the Drag Along Shares, and in  so doing shall be entitled to rely solely
upon the copy of the Drag Along Notice  delivered to it pursuant to this Clause 13.
Cayman Drug shall promptly surrender  to the Company for cancellation any share
certificate representing Drag Along  Shares transferred pursuant to this Clause 13.
Cayman Drug hereby appoints CULS  and any of its directors, officers or other authorised
signatories as its  attorney to provide any 





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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	consents
or execute any documentation on  behalf of  Cayman Drug required in connection with any
such sale to a third party of its  Drag Along Shares.









	14	Company
Sale






	 	If
a third party offers to acquire all or substantially all of the assets of the  Company
and CULS desires the Company to accept such offer, Cayman Drug agrees to  co-operate with
CULS for such purpose and to provide any required consents to  such sale. Cayman Drug
hereby appoints CULS and any of its directors, officers  or other authorised signatories
as its attorney to provide any consents or  execute any documentation on behalf of Cayman
Drug required in connection with  any such sale to a third party of the Company’s
assets.








	15	Dividends
and other Distributions






	 	The
Company will follow a full distribution policy and will, so far as possible,  distribute
realised profits and gains, after payment of Company expenses and  establishment of
reasonable reserves (which shall be determined by the directors  of the Company in their
absolute discretion) on each Distribution Date.








	16	Buy
Out Events and Sell Out Events






	16.1	A
Buy Out Event shall occur:






		(a)	if
Cayman Drug, NB or RB breaches or procures a breach of any term of this  Agreement, and
where such breach is capable of remedy the breach is continuing  30 days after written
notice of the breach has been given by CULS;






		(b)	if
any bankruptcy proceedings are commenced in relation to NB or RB;






		(c)	if Cayman Drug:






	 	 	(i) 	applies
for or consents to the appointment of a receiver, trustee or liquidator  of all or a
substantial part of its assets;






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***CONFIDENTIAL
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HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	 	(ii)	is
unable, or admits in writing its inability, to pay its debts as they mature;






	 	 	(iii)	makes
a general assignment for the benefit of creditors;






	 	 	(iv)	is
adjudicated bankrupt or insolvent;






	 	 	(v)	is
dissolved;






	 	 	(vi)	files
a petition in bankruptcy or for re-organization or for an agreement  pursuant to a
bankruptcy act or any insolvency law providing for the relief of  debtors, now or
hereafter in effect;






	 	 	(vii)	files
an answer admitting the material allegations of, or consents to, or  defaults in
answering, a petition filed against it in any bankruptcy,  re-organization or insolvency
proceeding;






	 	 	(viii)	takes
corporate action for the purpose of effecting any of the foregoing; or






	 	 	(ix)	purports
to transfer any of its shares in the Company in violation of this  Agreement; or






		(d)	upon
a change of control of Cayman Drug, which for these purposes shall mean  that (i) any
person other than NB or RB acquires control over greater than fifty  per cent. of the
voting share capital of Cayman Drug either alone or together  with other persons with
whom he is acting in concert or (ii) any person other  than NB or RB acquires effective
control over the day to day affairs of Cayman  Drug.






		(e)	upon
a change of control of CULS, which for these purposes shall mean that any  person who
does not currently control CULS shall obtain control over greater  than fifty per cent.
of the voting share capital or the assets of CULS either  alone or together with other
persons with whom he is acting in concert.






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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	16.2	A
Sell Out Event shall occur if at any time after the date which is five years  after the
date of this Agreement, CULS breaches any material term of this  Agreement and, where
such breach is capable of remedy, the breach is continuing  and no actions have been
commenced to cure the breach 30 days after written  notice of the breach has been given
to CULS.







	17	Restrictive
Covenants






	17.1	Cayman
Drug undertakes that it shall not, and undertakes to procure that neither  NB, RB nor any
other shareholder (or close relative of such shareholder) of  Cayman Drug from time to
time shall, take or omit to take, directly or  indirectly, any action, where the taking
or omitting to take such action (i)  might reasonably be considered likely to result in,
or which does result in, a  revocation or suspension of, or the imposition of additional
conditions in  relation to, any licence or permit required by the Company to do business
in the  Cayman Islands including, without limitation, any licences granted to the
Company pursuant to the Local Companies (Control) Law (1999 Revision) or the  Trade and
Business Licensing Law (2003 Revision) or (ii) otherwise has or may  have a detrimental
effect on or interfere with the business of the Company.






	17.2	Cayman
Drug undertakes that it shall not permit the transfer of any of its  issued shares or
issue any new shares (or, in each case, any other form of  equity interests) without the
prior written consent of CULS (which consent may  be granted or withheld at the sole and
absolute discretion of CULS).






	17.3	Cayman
Drug agrees that it will not enter into any agreement to transfer, or  otherwise purport
to transfer any of its Shares to a third party without the  prior written consent of CULS.







	18	No
Conflict






	 	Cayman
Drug acknowledges and agrees that CULS shall be entitled to enter into any  transaction
or agreement of any sort whatsoever with the Company. Cayman Drug,  NB and RB agree to
waive any right they may have to compensation in their  capacity as a direct or indirect
Shareholder of the Company resulting from such  transactions






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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	 	and/or
agreements and to  provide all necessary consents thereto  and/or provide any necessary
powers of attorney  or other required authorising  documentation. For the avoidance of
doubt, but without  limiting the foregoing,  the following types of transaction shall be
permitted:







		(a)	any
transaction pursuant to the terms of the Management Services Agreement or of  the type
contemplated by the Management Services Agreement;






		(b)	CULS
(or any of its Affiliates, or its or their employees or agents) shall be  permitted to
enter into negotiations or any agreement with any third party in  relation to the
establishment of any business venture in the Cayman Islands,  including any such venture
that may compete with the Company; and






		(c)	CULS
(or any of its Affiliates) shall be permitted to establish and/or carry on  any other
business venture in the Cayman Islands, whether or not such venture  may compete with the
Company.







	19	Provision
of Financial Statements






	 	The
Company shall, and the Shareholders agree to procure that the Company shall at  the cost
of the Company, provide quarterly financial statements (comprising a  balance sheet, P&L
statement and cash flow statement) to CULS within 20  Business Days of the end of each
such financial quarter. Such financial  statements shall be prepared in accordance with
U.S. generally accepted  accounting principles and on the same basis and for the same
financial periods  as CULS Parent prepares its accounts, and the Company shall employ
such  accounting methods and practices as are required for CULS Parent to comply with
U.S. regulatory requirements (including any reporting obligations under U.S.  securities
laws).








	20	 Annual
Audit






	 	The
Company shall, and the Shareholders agree to procure that the Company shall at  the cost
of the Company, have its accounts audited annually by an accounting  firm 








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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	nominated
by  CULS, in accordance with U.S. generally accepted accounting  principles as they are
applied by CULS Parent in its audited financial  statements.









	21	 Confidentiality
and Securities Laws






	21.1	Each
of the parties agrees to keep confidential all confidential information in  its
possession or that comes into its possession after the date of this  Agreement in
relation to any of the other parties (including any of their  Affiliates) or the Company,
this Agreement and any of the other agreements  referred to herein, any action taken
pursuant to this Agreement and the  negotiations relating to this Agreement, except that
the obligations contained  in this Clause shall not apply to any disclosure of
confidential information:






		(a)	required
by law or the rules of any regulatory body to which any party (or an  Affiliate of any
party) submits (including any securities listing authority or  any stock exchange), as
determined at the sole discretion of the disclosing  party (and the parties acknowledge
that CULS Parent may be required to disclose  this Agreement and any financial
information in relation to the Company in  compliance with its obligations to the
Securities Exchange Commission and  NASDAQ); or






		(b)	acquired
by any party after it ceases to be a shareholder in the Company (or in  the cases of NB
and RB, after Cayman Drug ceases to be a shareholder in the  Company), where such
information is not acquired in breach of any duty of  confidentiality; or






		(c)	where
such information has already entered the public domain other than as a  result of a
breach of confidentiality by the disclosing party.






	21.2	Cayman
Drug, NB and RB hereby agree and undertake to comply with all United  States securities
laws and regulations restricting the use of confidential  information relating to CULS
and/or CULS Parent including, without limitation,  any laws and regulations concerning
“insider dealing” (however termed)  in relation to securities issued by CULS
Parent.





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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	22	Guarantee






	 	In
consideration of CULS entering into this Agreement, NB and RB hereby jointly and
severally unconditionally and irrevocably guarantee as a primary and continuing
obligation the due performance by Cayman Drug of all its obligations under or  pursuant
to this Agreement, which shall include, without limitation, a guarantee  of the accuracy
of any representations and warranties given by Cayman Drug  herein.








	23	Supremacy
of this Agreement






	 	CULS,
Cayman Drug, NB and RB shall each use their respective votes in the Company and  shall
use reasonable endeavours to pursue all other means at its disposal so as:  (a) to ensure
that this Agreement is duly performed; and (b) to ensure that the  provisions of the
Memorandum and Articles are not infringed (save that, in the  event of any conflict
between this Agreement and the Memorandum and the  Articles, this Agreement shall prevail
as between the parties).








	24	Costs






	 	The
costs of and incidental to the incorporation of the Company shall be borne and  paid by
the Company. The costs of each of CULS and Cayman Drug incurred in the  preparation and
execution of this Agreement or any other agreement to be entered  into at First Closing
or otherwise pursuant to this Agreement, shall be borne by  such party.








	25	No
Partnership or Agency






	 	Nothing
in this Agreement shall be deemed to constitute a partnership between CULS and  Cayman
Drug and/or NB and/or RB or constitute either party the agent of the  other for any
purpose or entitle either party to commit or bind the other party  in any manner.








	26	Entire
agreement






	 	This
Agreement and any other Agreements entered into at First Closing pursuant to  Clause 3 or
otherwise to be entered into pursuant to the terms of this Agreement  (the “Transaction
Documents”) set out the entire agreement and  understanding between 






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***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	CULS,
Cayman  Drug, RB and NB with respect to the subject  matter hereof. It is agreed that:








		(a)	neither
party has entered into this Agreement in reliance upon any  representation, warranty or
undertaking of the other party which is not  expressly set out or referred to in the
Transaction Documents;






		(b)	no
party shall have any claim or remedy in respect of misrepresentation (whether  negligent
or otherwise) or untrue statement made by the other party; and






		(c)	this
Clause shall not exclude any liability for fraudulent misrepresentation.







	27	Mutual
consultation and goodwill






	 	CULS,
Cayman Drug, NB and RB confirm their intention to promote the best interests of  the
Company and to consult fully on all matters materially affecting the  development of the
Company’s business. Without imposing any additional  obligations not expressly set
out in this Agreement, each party agrees that such  obligations should be interpreted in
light of their aforementioned intentions.








	28	Notices






	 	Any
notice pursuant to this Agreement shall be in writing signed by (or by some  person duly
authorised by) the person giving it and may be served by leaving it  or sending it by
facsimile, prepaid recorded delivery or registered post to the  address of the other
party as follows (or to such other address as shall have  been duly notified in
accordance with this Clause). Notices shall be deemed  given (i) three days after the
date of mailing, (ii) the date of personal  delivery or sending by facsimile, or (iii)
two days after delivery to Federal  Express or other overnight courier, as the case may
be.







	 	The details for notices are:


Cost-U-Less Cayman Holdings

C/o Cost-U-Less, Inc.

3633 136th Place SE, Ste 110

Bellevue, WA 98006







27











***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	 	USA


Tel:             +1-425-945-0213  

Fax:             +1-425-945-0214  

Attention:  J Jeffrey Meder










	 	Cayman Drug Limited / Naul Bodden / Robert Bodden

C/o  NCB Consulting Ltd

PO  Box 1168 GT

Grand Cayman, Cayman Islands

Tel     :+1-345-946-0166

Attention:  Naul Bodden








	29	Assignment






	 	Unless
expressly permitted herein, the assignment by Cayman Drug of any of its rights  or
obligations under this Agreement is expressly prohibited without the prior  written
consent of CULS and this Agreement shall be binding upon any successors  or assigns of
Cayman Drug. Any of the rights or obligations of CULS under this  Agreement may be
assigned to any person by CULS.








	30	 Amendment;
Waiver






	 	Except
as expressly permitted by this Agreement, no amendment, modification,  termination or
waiver of any provision of this Agreement shall be valid unless  expressed in writing and
signed by all the parties to this Agreement. The waiver  by either CULS or Cayman Drug of
strict compliance of the provisions of this  Agreement by the other shall not be
interpreted as a waiver of any other right  provided for in this Agreement, nor as a
waiver to require the compliance of the  same right on future occasions. For the purposes
of this Clause 30, each of RB  and NB appoints Cayman Drug and any of its directors and
officers as his  attorney to execute







28











***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








	 	on
his behalf any written consent to the amendment,  modification, termination or waiver of
any provision of this Agreement.








	31	Survival
and validity






	 	If
any provision of this Agreement is declared by a court of competent jurisdiction  to be
void, invalid or unenforceable in whole or in part and such provision is  not related to
the payment of any amount due to the Advisor hereunder, such  declaration shall not
affect the remaining parts or provisions of this  Agreement, which shall remain valid and
enforceable. In any such case the  parties shall negotiate in good faith with a view to
replacing the void or  unenforceable part or provision with a new valid part or provision
which  preserves the original intention of the parties.








	32	Termination
Rights






	 	If
(i) the Lease has not been entered into pursuant to Clause 5.2 within 9 calendar  months
of the date of this Agreement, or (ii) Second Closing has not occurred by  the date which
is 24 calendar months after the date of this Agreement and such  non-occurrence is the
result of non-satisfaction of any of the conditions set  out in Clause 6, CULS may
terminate this Agreement immediately on written notice  to Cayman Drug at any time.








	33	Authority
of NB and RB






	 	Cayman
Drug agrees and acknowledges that CULS will be entitled to rely on the authority  of NB
and/or RB to act on behalf of Cayman Drug in respect of any waiver,  consent,
acknowledgement or other document or action given, executed or carried  out under or
pursuant to the terms of this Agreement, until written notice of  the revocation of such
authority is given to CULS by Cayman Drug.







29












***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.









	34	Governing
Law, etc.






	 	This
Agreement  shall be governed by, and construed in accordance with, the laws of the Cayman
Islands.







	 	The
parties agree that all disputes in relation to this Agreement shall be resolved  by
binding arbitration administered by the American Arbitration Association  under its
Commercial Arbitration Rules, before one arbitrator, with limited  discovery in Atlanta,
Georgia, USA. The arbitrator shall apply the laws of the  Cayman Islands without regard
to the conflict of laws principle. Any arbitration  award in respect of this Agreement
may be enforced in any court of competent  jurisdiction.







	34.1	The
parties agree that the courts of the State of Georgia, U.S.A. shall have  jurisdiction to
resolve any disputes in relation to, or to grant any order to  enforce, Clause 34.2 of
this Agreement and the parties irrevocably agree to  submit to such jurisdiction and to
waive any right to object on the grounds of  forum non conveniens or otherwise.







	35	 Counterparts






	 	This
Agreement, and any amendment hereto, may be executed in counterparts, each of  which
shall be deemed an original and all of which, when taken together, shall  constitute one
and the same instrument, binding on the parties, and the  signature of any party to any
counterpart shall be deemed a signature to, and  may be appended to, any other
counterpart.








	36	No
Inferences






	 	Each
of NB and RB hereby confirms that he has had the opportunity to consult legal  counsel
prior to his entry into this Agreement. The parties agree that the terms  of this
Agreement have been fully negotiated and that no terms shall be  construed against CULS
or the Company merely on the basis that the Agreement has  been drafted by legal counsel
to CULS.









[REMAINDER OF
PAGE LEFT BLANK]



30











***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.













SCHEDULE
1




Memorandum
and Articles of Association



31












***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.












SCHEDULE
2




Management
Services Agreement



32












***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.












SCHEDULE
3




Financial
Statements




33












***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.











SCHEDULE
4




Loan
and Security Agreements



34

















***CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY FILED
HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST. OMISSIONS
ARE DESIGNATED AS *(REDACTED). A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.








IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as a deed
on the day and year first before written.




	Executed as a deed by  	)	 
	Cost-U-Less Cayman Holdings	)	 
	by	)	      _________________________________________
	duly authorised in that behalf	)	 







	Executed as a deed by  	)	 
	Cayman Drug Limited	)	 
	by	)	      _________________________________________
	duly authorised in that behalf	)	 







	Executed as a deed by  	)	 
	Cayman Cost-U-Less Limited	)	 
	by	)	      _________________________________________
	duly authorised in that behalf	)	 







	Executed as a deed by  	)	 
	Naul Bodden	) 	      _________________________________________
	 	 	 
	In the presence of	)	 
	Name:	)	      _________________________________________







	Executed as a deed by  	)	 
	Robert Bodden	) 	      _________________________________________
	 	 	 
	In the presence of	)	 
	Name:	)	      _________________________________________