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COOKS FOOD GROUP LIMITED (“the Company”)

TERMS OF ISSUE OF PREFERENCE SHARES

No. to be Issued: Maximum of 10,000,000

Issue Price: $0.25 per Preference Share

Ranking: Rank in priority to Ordinary Shares of the Company in the event of the winding of the Company but behind any creditors of the Company.

Interest Rate: 12.5% interest p.a. paid monthly in arrears.

Conversion/Redemption Date:

31 December 2010

Conversion/Redemption Terms:

The holder may, at their discretion, elect on the Conversion/Redemption Date to:

• Convert their Preference Shares to Ordinary Shares of the Company on a 1:1 basis, with such Ordinary Shares on conversion ranking pari passu in all respects with all other Ordinary Shares of the Company;

• Redeem their Preference Shares and receive from the Company the Issue Price; or

• A combination of the above.

Voting rights: Preference Shares confer the same voting rights as Ordinary Shares of the Company.

Distribution Entitlements:

Preference Shares are not entitled to participate in any distributions declared in respect of Ordinary Shares.

Minimum Subscription: 80,000 Preference Shares or such other number as the Board may determine in its discretion.

Listing: The Preference Shares will be unlisted securities. Where a holder elects to convert to Ordinary Shares on the Conversion/Redemption Date, such Ordinary Shares issued shall be quoted on the NZAX market at allotment provided that all other Ordinary Shares of the Company are quoted on the NZAX market on the Conversion/Redemption Date.

Transferability Freely transferable by private treaty.