UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

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20162018 PROXY STATEMENT

ANNUAL MEETING OF SHAREHOLDERS

The Annual Meeting of Shareholders will be held at

PRICESMART, INC.

9740 Scranton Road

San Diego, California 92121

PRICESMART, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT

TO THE STOCKHOLDERS OF PRICESMART, INC.:

Notice is hereby given that the Annual Meeting of the Stockholders of PriceSmart, Inc. (the “Company”), will be held at 10:00 a.m. on Wednesday, February 1, 2017January 30, 2019 at the Company’s corporate headquarters, 9740 Scranton Road, San Diego, California, 92121 for the following purposes:

The foregoing items of business are more fully described in the Proxy Statement accompanying this Notice. The Board of Directors has fixed the close of business on December 9, 20167, 2018 as the record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting. A list of such stockholders shall be open to the examination of any stockholder at the Annual Meeting and for a period of ten days prior to the date of the Annual Meeting at the Company’s corporate headquarters, 9740 Scranton Road, San Diego, California 92121.

Accompanying this Notice is a Proxy. WHETHER OR NOT YOU EXPECT TO BE AT THE ANNUAL MEETING, PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY, OR YOU MAY VOTE YOUR SHARES BY TELEPHONE OR OVER THE INTERNET, AS DESCRIBED IN THE ENCLOSED PROXY. If you plan to attend the Annual Meeting and wish to vote your shares personally, you may do so at any time before the Proxy is voted.

All stockholders are cordially invited to attend the meeting.

BY ORDER OF THE BOARD OF DIRECTORS

Francisco J. Velasco

Secretary

San Diego, California

December 19, 201620, 2018

Table of Contents

PRICESMART, INC.

9740 Scranton Road

San Diego, California 92121

PROXY STATEMENT

for

ANNUAL MEETING OF STOCKHOLDERS

February 1, 2017January 30, 2019

The Board of Directors of PriceSmart, Inc., a Delaware corporation (the “Company”), is soliciting the enclosed Proxy for use at the Annual Meeting of Stockholders of the Company to be held on February 1, 2017January 30, 2019 (the “Annual Meeting”), and at any adjournments thereof. This Proxy Statement will be first sent to stockholders on or about December 9, 2016.20, 2018. You can submit your Proxy by mail or you may provide voting instructions for your shares by telephone or via the Internet. Instructions for voting by telephone, by using the Internet or by mail are described on the enclosed Proxy. If you plan to attend the Annual Meeting and wish to vote your shares personally, you may do so. Unless contrary instructions are indicated on the Proxy, all shares represented by valid Proxies received pursuant to this solicitation (and not revoked before they are voted) will be voted for the election of the Board of Directors’ nominees for directors, or for a substitute or substitutes selected by the Board of Directors in the event a nominee or nominees are unable to serve or decline to do so.so; for the approval, on an advisory basis, of the compensation of the Company’s executive officers for fiscal year 2018; and for the ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending August 31, 2019. As to any other business which may properly come before the Annual Meeting and be submitted to a vote of the stockholders, Proxies received by the Board of Directors will be voted in accordance with the best judgment of the holders thereof.

A Proxy may be revoked by written notice to the Secretary of the Company at any time prior to the Annual Meeting by executing a later Proxy or by attending the Annual Meeting and voting in person.

The Company will bear the cost of solicitation of Proxies. In addition to the use of mails, Proxies may be solicited by personal interview, telephone, facsimile ore-mail, by officers, directors and other employees of the Company. The Company also will request persons, firms and corporations holding shares in their names, or in the names of their nominees, which are beneficially owned by others, to send, or cause to be sent, Proxy material to, and obtain Proxies from, such beneficial owners and will reimburse such holders for their reasonable expenses in so doing.

The Company’s mailing address is 9740 Scranton Road, San Diego, California 92121.

Voting

Stockholders of record at the close of business on December 9, 20167, 2018 (the “Record Date”) will be entitled to notice of, and to vote at, the Annual Meeting or any adjournments thereof.

As of December 9, 2016, 30,406,4337, 2018, 30,489,396 shares of the Company’s common stock, $.0001$0.0001 par value per share (“Common Stock”), were outstanding, representing the only voting securities of the Company. Each share of Common Stock is entitled to one vote.

Votes cast by Proxy or in person at the Annual Meeting will be counted by the person appointed by the Company to act as Inspector of Election for the Annual Meeting. The Inspector of Election will treat shares represented by Proxies that reflect abstentions or include “brokernon-votes” as shares that are present and entitled to vote for purposes of determining the presence of a quorum.

Because directors are elected by a plurality of the votes of the shares present in person or represented by Proxy at the Annual Meeting and entitled to vote on the election of directors, abstentions and “broker non-votes” do not constitute a vote “for” or “against” any nominee for the Boardten director nominees who receive the greatest number of Directors and thusvotes cast will be disregarded in the calculation of “votes cast” for purposes of electing nominees to the Board of Directors. Abstentions will have the same effect as votes against this proposal and broker non-votes will have no effect on the outcome.

Thenon-binding advisory vote on executive compensation and the ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending August 31, 2019 require the affirmative vote of a majority of the aggregate votes present, in person or by proxy, and entitled to vote at the Annual Meeting.

Abstentions and brokernon-votes are not included as votes cast and will not affect the outcome of any of the proposals. Brokernon-votes occur when a person holding shares in street name, such as through a brokerage firm, does not provide instructions as to how to vote those shares and the broker does not then vote those shares on the stockholder’s behalf.

CEO Transition

On October 25, 2018, the Company announced the resignation by mutual agreement of its Chief Executive Officer, President and director Jose Luis Laparte, effective November 16, 2018. The Company appointed Sherry S. Bahrambeygui, a member of our Board of Directors, as Interim Chief Executive Officer effective November 16, 2018 while the Company conducts a search for a permanent Chief Executive Officer. Mr. Laparte agreed to support the interim CEO and make himself available at her request through the end of the current calendar year. Robert E. Price, Company Founder and our Chairman, became Executive Chairman in October 2018.

Proposal 1  Election of DirectorsofDirectors

Based on the recommendation of the Nominating/Corporate Governance Committee, the Board of Directors of the Company has nominated and recommends for election as directors the ten persons named herein to serve until the next Annual Meeting of Stockholders and until their respective successors shall have been duly elected and qualified. All of the nominees are presently directors of the Company, and following the Annual Meeting, there will be no vacancies on the Board of Directors. Each of the nominees has consented to serving as a nominee and being named as a nominee in this Proxy Statement and to serving as a director if elected. Directors are elected by a plurality of the votes of the shares present in person or represented by Proxy at the Annual Meeting and entitled to vote on the election of directors. The enclosed Proxy will be voted in favor of the persons nominated unless otherwise indicated. If any of the nominees should be unable to serve or should decline to do so, the discretionary authority provided in the Proxy will be exercised by the proxy holders to vote the shares represented by the Proxies for one or more substitute nominees selected by the present Board of Directors. The Board of Directors does not believe at this time that any substitute nominee or nominees will be required.

Nominations Process

Identification and Evaluation of Nominees for Directors

The Nominating/Corporate Governance Committee identifies nominees for director by first evaluating the current members of our Board of Directors willing to continue in service. Current members with qualifications and skills that are consistent with the Nominating/Corporate Governance Committee’s criteria for board service, as set forth in the section below entitled “Director Qualifications,” and who are willing to continue in service are considered forre-nomination, balancing the value of continuity of service by existing members of our Board of Directors with that of obtaining a new perspective.

If any member of the Board of Directors does not wish to continue in service or if the Board of Directors decides not tore-nominate a member forre-election, the Nominating/Corporate Governance Committee identifies the desired skills and experience of a new nominee in light of the criteria set forth below in “Director Qualifications.” The Nominating/Corporate Governance Committee generally consults with other members of the Board of Directors and may seek input from management, independent counsel, industry experts or advisors that the Nominating/Corporate Governance Committee believes to be desirable and appropriate. The Nominating/Corporate Governance Committee reviews the qualifications, experience and background of any candidates who are identified. Final candidates are interviewed by the members of the Nominating/Corporate Governance Committee. In making its determinations, the Nominating/Corporate Governance Committee evaluates each individual in the context of the Board of Directors as a whole, with the objective of assembling a group that can best perpetuate the success of the Company and represent stockholder interests through the exercise of sound judgment. After review and deliberation of all feedback and data, the Nominating/Corporate Governance Committee makes its recommendation to the Board of Directors.

Pursuant to the Nominating/Corporate Governance Committee Charter, stockholders of the Company who have held shares of the Company’s Common Stock for at least one year and who hold a minimum of 1% of the Company’s outstanding shares of Common Stock may suggest a candidate for director by writing to the Secretary of the Company. In order to be considered, the recommendation for a candidate must include the following written information: (1) a detailed resume of the recommended candidate; (2) an explanation of the reasons why the stockholder believes the recommended candidate is qualified for service on the Board of Directors; (3) such other information that would be required by the rules of the SEC to be included in a proxy statement; (4) the written consent of the recommended candidate; (5) a description of any arrangements or undertakings between the stockholder and the recommended candidate regarding the nomination; and (6) proof of the recommending stockholder’s stock holdings in the Company. In addition, we may require any candidate to furnish such other information as may reasonably be required by the Company to determine the eligibility of such candidate to serve as an independent director in accordance with the Company’s corporate governance guidelines or that could be material to a reasonable stockholder’s understanding of the independence or lack of independence of such candidate. In order to give the Nominating/Corporate Governance Committee sufficient time to evaluate a recommended candidate and/or include the candidate in the Company’s proxy statement for the annual meeting to be held in 2018, the recommendation should be received by the Secretary of the

Proposal 1  Election of Directors (continued)

proxy statement for the annual meeting to be held in 2020, the recommendation should be received by the Secretary of the Company at the Company’s principal executive offices no later than August 21, 2017.22, 2019. In the event that the Company receives director candidate recommendations from stockholders, those recommendations are evaluated in the same manner that potential nominees suggested by Board members, management or other parties are evaluated. The Company does not intend to treat stockholder recommendations in any manner different from other recommendations.

Director Qualifications

In evaluating director nominees, the Nominating/Corporate Governance Committee considers, among other things, the following factors:

While the Company does not have a specific policy regarding board diversity, in connection with its evaluation of director nominees, the Nominating/Corporate Governance Committee also considers diversity of expertise and experience in substantive matters pertaining to our business relative to other members of the Board of Directors. The Nominating/Corporate Governance Committee also considers diversity of background (including diversity of gender, race and ethnicity) and life experience. The Nominating/Corporate Governance Committee’s objective is to assemble a group that can best perpetuate the success of the business and represent stockholder interests through the exercise of sound judgment using its diversity of experience.

Other than the foregoing, there are no stated minimum criteria for director nominees, although the Nominating/Corporate Governance Committee may also consider such other facts as it may deem are in the best interests of the Company and its stockholders. The Nominating/Corporate Governance Committee also believes it is appropriate for at least one, and, preferably, several, members of the Board of Directors to meet the criteria for an “audit committee financial expert” as defined by SEC rules, and that a majority of the members of the Board of Directors be independent as required under the Nasdaq Stock Market listing standards applicable to the Company. The Nominating/Corporate Governance Committee also believes it is appropriate for the Company’s chief executive officer to serve as a member of the Board of Directors. Directors’ performance and qualification criteriaqualifications are reviewed annually by the Nominating/Corporate Governance Committee.

A copy of the Nominating/Corporate Governance Committee Charter is available on the Company’s website at www.pricesmart.com.www.pricesmart.com.

Independent Directors

The Company’s Board of Directors has determined that the following nominees for director are “independent” under the Nasdaq Stock Market listing standards applicable to the Company: Sherry Bahrambeygui, Gonzalo Barrutieta, Gordon Hanson, Beatriz Infante, Leon Janks, Mitchell Lynn, Pierre Mignault, Gary Malino and Edgar Zurcher. The Board of Directors also determined that Sherry Bahrambeygui was independent until becoming the Company’s interim Chief Executive Officer but that she would not be considered independent for so long as she is serving in that role.

Proposal 1  Election of Directors (continued)

Information Regarding Nominees

The table below indicates the name, current position with the Company and age as of October 31, 2016November 30, 2018 of each nominee for director.

Robert E. Price has been Executive Chairman of the Board of Directors of the Company since July 1994 andOctober 2018. He previously served as Chairman since the Company’sspin-off from Price Enterprises, Inc. in 1997. Mr. Price served as Chief Executive Officer and President of the Company at various times during the Company’s history, most recently as Chief Executive Officer from April 2006 until July 2010. Mr. Price was a founder of The Price Company, which operated the Price Club, and served as Interimits Chief Executive Officer and a member of its board of directors from the Company from April 2003time of The Price Company’s founding in 1976 until April 2006 and also served as Interim President of the Company from April 2003 until October 2004. Mr.The Price also served as President and Chief Executive Officer of the Company from July 1994 until January 1998. Mr. Price is President of Price Charities, fka San Diego RevitalizationCompany’s merger with Costco Wholesale Corp. Mr. Price previously served as Chairman of the Board of Price Enterprises, Inc. (“PEI”) from July 1994 until November 1999 and was President and Chief Executive Officer of PEI from July 1994 until September 1997.in 1993. Mr. Price was Chairman of the Board of Price/Costco, Inc. (“Price/Costco”) from October 1993 tountil December 1994. From 1976 to October 1993, he was Chief Executive Officer1994 and a directorChairman of The Price Company (“TPC”).Enterprises from July 1994 until September 1997. Mr. Price servedcurrently serves as Chairman of the Board of TPC from January 1989 to October 1993, and as its President from 1976 until December 1990. Mr. Price has been a Manager of The Price Group, LLC since August 2000.and as President of Price Philanthropies Foundation and Price Charities. Price Philanthropies is a private family foundation that supports charitable activities in the Company’s markets and San Diego, California. Mr. Price’s significant40 year experience as an executive and director ofin the warehouse club merchandising businesses,business as well as his extensive knowledge of the Company’s business, history and culture, support the Board of Directors’ conclusion that he should serve as a director of the Company.

Leon C. Janks has been Lead Director of the Company since October 2018 and has served as a director of the Company since July 1997. He served as Vice Chair of the Board from October 2017 to October 2018. Mr. Janks served as a director of Price Enterprises from March 1995 until July 1997. He has been a partner in the accounting firm of Green, Hasson & Janks LLP in Los Angeles, California since 1980 and serves as its Managing Partner Emeritus. Mr. Janks has extensive experience in domestic and international business, serving a wide variety of clients in diverse businesses. Mr. Janks is a certified public accountant. Mr. Janks’ experience, his significant accounting, financial and tax expertise which qualify him as an audit committee financial expert and his many years of service to the Company as a member of the Board of Directors contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Sherry S. Bahrambeygui has been Interim Chief Executive Officer of the Company since November 2018 and has served as a director of the Company since November 20112011. During her tenure on the Board, Ms. Bahrambeygui has been an instrumental component of the evolution of the Company’s governance and has led several efforts of strategic importance to the Company, including identification and recruitment of key talent for executive leadership, execution of strategic negotiations, and leading the acquisition of the technology and online business, Aeropost, Inc. Ms. Bahrambeygui served as Vice Chair of the Board sincefrom October 2016.2016 to October 2017. Ms. Bahrambeygui joinedhas served as a Senior Executive and Managing Member of The Price Group, LLC in September 2006 and has served as a Manager since January 2007. Additionally, Ms. Bahrambeygui2007, serves as Executive Vice President, Secretary and Vice Chairman of the Boards of Price

Proposal 1  Election of Directors (continued)

Charities (fka San Diego Revitalization Corp.), and Price Philanthropies Foundation, and is the Chief Executive Officer of PS Ivanhoe, LLC, a commercial real estate investment company. Ms. Bahrambeygui was a licensed stockbroker and a founding partner of the law firm ofBahrambeygui & Hosey & Bahrambeygui, LLP. She hasLLP and practiced law with an emphasis inon international business, corporate and employment compensation, business and corporate matters since 1993 and had provided consultation and legal representationlaw. In this capacity prior to joining the Board of Directors, Ms. Bahrambeygui represented the Company from time-to-time between 2001 and 2008.in several complex litigation matters achieving favorable outcomes. Ms. Bahrambeygui was admitted in August 2015 tostudied at Columbia University and graduated with a B.A. from the BarUniversity of the Supreme CourtCalifornia San Diego and a J.D. from California Western School of the United States.Law. Ms. Bahrambeygui’s thorough understanding of the business and operations of the Company, extensive knowledge of international business and investments, as well as having effectively assisted the Company on certain legal anda variety of complex business matters, contribute to the Board of Directors’ conclusion that she should serve as a director of the Company.

Gonzalo Barrutietahas been a director of the Company since February 2008. Mr. Barrutieta was employed in several capacities with Grupo Gigante, S.A. de C. V. from 1994 to 2006, including as Director of Real Estate and New Business Development. Since 1994, he has served as a member of the board of directors of Grupo Gigante. From 2002 through 2005, Mr. Barrutieta was a director of PriceSmart Mexico (formerly a joint venture between the Company and Grupo Gigante) and

Proposal 1  Election of Directors (continued)

served as Chief Executive Officer of PriceSmart Mexico from 2003 to 2005. Mr. Barrutieta has also been a director of Hoteles Presidente since 2004, of Office Depot Mexico since 2005, of Radio Shack Mexico from 2005 until 2012, and has served as President and director of Operadora IPC de Mexico since 2007. Mr. Barrutieta’s experience as an executive and director of international merchandising businesses, as well as his general knowledge and understanding of the markets in CentralLatin America, contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Gordon H. Hanson has been a director of the Company since April 2014. Mr. Hanson has been a tenured member of the economics faculty at the University of California, San Diego since 2001. At UC San Diego, Mr. Hanson is the Acting Dean of the School of Global Policy and also directs the Center on Global Transformation. From 1998 to 2001, he was a tenured member of management faculty toat the University of Michigan, and from 1992 to 1998, he was on the economics faculty of the University of Texas. From 2009 until 2014, he served as a director of the Washington Office on Latin America, anon-profit organization working to promote civic advancement in the region, chairing their development committee. Mr. Hanson’s extensive background in the analysis of the economies of Latin America, including over two decades of experience in consulting for international financial organizations, contribute to the Board of Directors’ conclusion that he should serve as director of the Company.

Leon C. JanksBeatriz V. Infantehas been a director of the Company since July 1997 andJanuary 2018. Since 2009, Ms. Infante has served as Chief Executive Officer of BusinessExcelleration LLC, a directorbusiness consultancy specializing in corporate transformation and renewal. Since May 2014, she has served on the board of PEI from March 1995 until July 1997. He has been a partner in the accounting firm of Green, Hasson & Janks LLP in Los Angeles, California since 1980directors and serves as its Managing Partner. Mr. Janks has extensive experience in domestic and international business, serving a wide variety of clients in diverse businesses. Mr. Janks is a certified public accountant. Mr. Janks’ experience, and his significant accounting, financial and tax expertise and his many years of service to the Company as a member of the audit committee of Liquidity Services Inc., an online marketplace for retail goods and capital assets, and has additionally served as chair of the compensation committee since November 2015. Since October 2017, she has served as director and member of the compensation and audit committees of Ribbon Communications Inc., a cloud communications company formed from the merger of Sonus Networks, Inc. and GENBAND Holdings Company. From 2010 until its acquisition by Infor in 2011, Ms. Infante was the Chief Executive Officer and a director of ENXSUITE Corporation. From 2006 until its acquisition by Voxeo Corporation in 2008, she was the Chief Executive Officer and a director of VoiceObjects Inc. Ms. Infante served as director and Interim Chief Executive Officer of Sychron, Inc from 2004 until its sale in 2005 to an investor group. Ms. Infante was Chief Executive Officer and President of Aspect Communications Corporation from April 2000 until October 2003, was additionally named Chairman in February 2001, and between October 1998 and April 2000 held additional executive roles, includingCo-President. Ms. Infante currently serves on the board of directors or advisory boards of private companies in the areas of cloud infrastructure, cybersecurity and intelligent automation. Additionally, Ms. Infante is a National Association of Corporate Directors Board Leadership Fellow, and was named to the 2016 “NACD Directorship 100,” which honors the most influential boardroom leaders each year. Ms. Infante holds a bachelor of science and engineering degree in electrical engineering and computer science from Princeton University and holds a master of science degree in engineering science from California Institute of Technology. Ms. Infante’ s executive leadership experience, including from her service as a chief executive officer of various companies, along with extensive operational expertise and

Proposal 1  Election of Directors (continued)

experience in digital transformation, engineering, sales and marketing, contribute to the Board of Directors’ conclusion that heshe should serve as a director of the Company.

Jose Luis Laparte has been a director of the Company since February 2008, Chief Executive Officer of the Company since July 2010 and President of the Company since October 2004. Mr. Laparte initially served as a consultant for the Company from December 2003 to October 2004. Prior to joining the Company as a consultant, Mr. Laparte worked for more than 14 years at Wal-Mart Stores, Inc. in Mexico and the United States in progressively responsible positions. From October 2002 through September 2003, he served as Vice President of Sam’s International, where he directed and managed the company’s operations, finance, sales, marketing, product development and merchandising. From May 2000 to October 2002, he served as Vice President, Wal-Mart de Mexico, responsible for sales and the expansion of the Sam’s Club format in Mexico. Mr. Laparte’s background and experience as an executive overseeing numerous operational aspects of the international merchandising business, including sales, product development, merchandising, marketing, finance and information technology, contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Mitchell G. Lynn has been a director of the Company since November 2011. Mr. Lynn served in several senior executive positions and as the President and a director of TPCThe Price Company prior to its merger in 1993 with Costco, Inc., and from 1993 until 1994, he served as an executive officer, director and member of the Executive Committee of Price/Costco. Mr. Lynn also was a member of The Price Group, LLC from 2005 to 2008. Mr. Lynn is a founding and continuing director of Bodega Latina Corporation, dba El Super and Fiesta Mart, a 61-store122-store warehouse-style grocery retailer that targets the Hispanic market in the Westernsouthwestern United States. Mr. Lynn is a founding and continuing director of Origin International Inc., which is focused on recycling waste oils. Mr. Lynn is also the founder, limited partner and a general partner of CRI 2000, LP, dba Combined Resources International, (“CRI”),and Lightspeed Outdoors, LP, dba Lightspeed, which designs, develops and manufactures consumer products under various brand names for domestic and international wholesale distribution, primarily through warehouse clubs.clubs and online retailers. Mr. Lynn also is a founder, limited partner and a general partner of ECR4Kids LP (“ECR”),dba ECR4Kids, which designs, manufactures, imports and sells educational/classroom products to wholesale dealers.dealers and online retailers. Mr. Lynn is a certified public accountant (inactive) and a licensed real estate broker in California. Mr. Lynn’s extensive prior experience in both the warehouse club business and general retailing and his significant knowledge relating to accounting and financial matters contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Gary Malino has been a director of the Company since April 2016. Mr. Malino is a former senior executive of Realty Income Corporation, a real estate investment trust (REIT) listed on the New York Stock Exchange. Mr. Malino joined Realty Income

Proposal 1  Election of Directors (continued)

Corporation in 1985 and was the Chief Financial Officer from 1994 until 2001 when he was promoted to President and Chief Operating Officer, the position he held until his retirement in 2014. Prior to joining Realty Income, Mr. Malino was a certified public accountantmanager for a Los Angeles basedAngeles-based public accounting firm (1981-1985) and assistant controller with McMillin Development Company, a real estate development company (1979-1981). Mr. Malino is a certified public accountant (inactive) and a licensed real estate broker in California. Mr. Malino’s extensive experience as a prior executive of a publicly traded company, his accounting background and his extensive experience with finance and real estate matters contributed to the Board of Directors’ conclusion that he should serve as a director of the Company.

Pierre Mignaulthas been a director of the Company since August 2015. Mr. Mignault has more than 45 years’ experience in the retail sector, starting his career in 1969 as a management trainee with The Bay Department Stores (Hudson’s Bay Company) and working through a series of executive positions, ultimately serving as General Manager for the eastern region from 1983 until 1985. From 1985 to 1993, he served as Chief Executive Officer of Price Club Canada. Mr. Mignault served as Chief Executive Officer of ProbigoProvigo Inc., a Canadian public company and the second largest food retailer in Canada, from 1993 until it was acquired by Loblaw Companies Limited in November 1998, remaining with that company through March 1999. From 2000 until September 2005, he was Chairman of Fly America Furniture, a private company. Mr. Mignault’s extensive knowledge and significant experience in both the warehouse club business and general retailing contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Edgar Zurcherhas been a director of the Company since October 2009 and also served as a director of the Company from November 2000 to February 2008. Mr. Zurcher has been a partner in the law firm Zurcher, Odio & Raven in Costa Rica since 1980, which the Company uses as counsel for certain legal matters. Mr. Zurcher is also President of PLP, S.A., as well as a director of Payless ShoeSource Holdings, Ltd. (“Payless Shoes”). PLP, S.A. owns 40% of Payless Shoes, which rents retail space from PriceSmart.Shoes. Additionally, Mr. Zurcher is a director of Molinos de Costa Rica Pasta and Roma S.A. dba Roma Prince S.A., from which the Company purchases products to sell to its members at its warehouse clubs, and is a director of Promerica Financial Corporation, S.A. from which the Company received rental income and credit card fees in fiscal years 2007 and 2008. Mr. Zurcher’s background in legal matters and his significant experience in Central America business and legal affairs contribute to the Board of Directors’ conclusion that he should serve as a director of the Company.

Proposal 1  Election of Directors (continued)

Recommendation of the Board of Directors

The Board of Directors recommends that stockholders vote FOR the slate of nominees set forth above. Proxies solicited by the Board of Directors will be so voted unless stockholders specify otherwise on the accompanying Proxy.

Information Regarding the Board of Directors

Board Meetings

The Company’s Board of Directors held sixeleven meetings during fiscal year 2016.2018. Except for Mr. Barrutieta (who resides in Mexico), Mr. Zurcher (who resides in Costa Rica) and Mr. Mignault (who resides in Canada),Lynn, no nominee for director who served as a director during the past year attended fewer than 75% of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings of committees of the Board of Directors on which he or she served.

Board Leadership Structure

The positions of Chairman and Chief Executive Officer are separated, withseparate. During fiscal year 2018, Mr. Price servingserved as Chairman and Mr. Laparte servingserved as Chief Executive Officer and President. AsSince November 2018, Ms. Bahrambeygui has served as Interim Chief Executive Officer, and President, Mr. Laparte is responsible for the day to day leadership and performance of the Company, with the Board of Directors being responsible for setting the strategic direction of the Company. As Chairman, Mr. Price provideshas served as Executive Chairman and Mr. Janks has served as Lead Director. The Executive Chairman takes the lead on running the board of directors meetings, CEO succession, CEO development and guidance to theand strategic vision and plan guidance. The interim Chief Executive Officer takes the lead on running the Company, including strategic plan and President, sets the agenda forprocess, operating process, organizational process, compensation practices and management development. The Lead Director presides at meetings of the Board of Directors and presides over those meetings.at which the Executive Chairman is not present, including executive sessions of the independent directors. The Board of Directors believes that the current leadership of the Board of Directors by the Company’s non-executiveExecutive Chairman and Lead Director enhances the effectiveness of its oversight of management and provides a perspective that is separate and distinct from that of management.

Role of the Board of Directors in Risk Oversight

The Board of Directors oversees the Company’s risk management processes, either as a whole or through its committees. Committees of the Board of Directors review with management and the Company’s internal audit department the Company’s major risk exposures, their potential impact on the Company’s business and the steps the Company takes to manage such risk exposures. The Board of Directors’ risk oversight process includes receiving reports from committees of the Board of Directors and members of senior management.

Committees of the Board

Audit Committee. The Audit Committee, which currently consists of Mr. Janks, Mr. Barrutieta, Ms. Hensley and Mr. Malino, and Ms. Infante held fourfive meetings during fiscal year 2016.2018. The Audit Committee oversees the Company’s accounting and financial reporting processes and the audits of its consolidated financial statements. The Committee reviews the annual audits conducted by the Company’s independent public accountants, reviews and evaluates internal accounting controls, is responsible for the selection of the Company’s independent public accountants, and conducts such reviews and examinations as it deems necessary with respect to the practices and policies of, and the relationship between, the Company and its independent public accountants. All committee members satisfy the Nasdaq Stock Market’s standards for “independence,” including applicable audit committee independence requirements, and the Board of Directors has determined that Mr. Janks qualifies as an “audit committee financial expert” within the meaning of the applicable SEC rules and regulations. The Audit Committee is governed by a written charter adopted by the Board of Directors, which is available on the Company’s public website atwww.pricesmart.com.

Compensation Committee. The Compensation Committee, which currently consistsconsisted of Ms. Bahrambeygui, Ms. Hensley, Mr. Janks, Ms. Infante and Mr. Mignault,Malino during fiscal year 2018, held eightseven meetings during fiscal year 2016.2018. Ms. Bahrambeygui resigned from the Compensation Committee and Ms. Infante became Chair in October 2018. Each of the current members of the Compensation Committee satisfies the Nasdaq Stock Market’s standards for “independence,” including applicable compensation committee independence requirements. The Compensation Committee oversees the compensation philosophy for the Company and reviews and approves the compensation program for the Company’s executive officers. The Committee is authorized to evaluate and determine the compensation of the Company’s Chief Executive Officer and reviews and approves compensation for all other executive officers. The Committee also administers, interprets and makes grants under the Company’s equity incentive award plans. The Compensation Committee is governed by a written charter adopted by the Board of Directors, which is available on the Company’s public website atwww.pricesmart.com.

Information Regarding the Board of Directors (continued)

Nominating/Corporate Governance Committee. The NominatingNominating/Corporate Governance Committee, which currently consistsconsisted of Ms. Hensley, Ms. Bahrambeygui and Mr. Lynn held two meetings during fiscal year 2016.2018, held one meeting during fiscal year 2018. Ms. Bahrambeygui resigned from the Nominating/Corporate Governance Committee and Mr. Janks joined the Nominating/Corporate Governance Committee as Chair in October 2018. The Nominating/Corporate Governance Committee considers the slate of nominees to be presented for reelection at annual meetings of stockholders. The Nominating/Corporate

Information Regarding the Board of Directors (continued)

Governance Committee also may evaluate and recommend candidates to add expertise and fill vacancies on the Board of Directors, which vacancies may be created by the departure of any directors or the expansion of the number of members of the Board of Directors. The Nominating/Corporate Governance Committee approved the nomination of the candidates reflected in Proposal 1 and approved the appointment of Mr. Malino to the Board prior to his election effective as of April 2016.1. The Nominating/Corporate Governance Committee also assists the Board of Directors as needed in establishing corporate governance guidelines and other policies and procedures pertaining to corporate governance matters. The Nominating/Corporate Governance Committee is governed by a written charter adopted by the Board of Directors, which is available on the Company’s public website atwww.pricesmart.com.

Executive Committee. The Executive Committee, which currently consists of Mr. Price, Mr. Janks and Ms. Bahrambeygui, did not hold anyheld no meetings during fiscal year 2016.2018. The Executive Committee has all powers and rights necessary to exercise the full authority of the Board of Directors in the management of the business and affairs of the Company, except as provided in the Delaware General Corporation Law or the Bylaws of the Company.

Finance Committee. The Finance Committee, which currently consists of Mr. Janks, Mr. Hanson, Ms. HensleyMr. Malino and Mr. Price, held fivefour meetings during fiscal year 2016.2018. The Finance Committee reviews and makes recommendations with respect to (1) annual budgets, (2) investments, (3) financing arrangements and (4) the creation, incurrence, assumption or guaranty by the Company of any indebtedness, obligation or liability, except, in each case, for any such transactions entered into in the ordinary course of business of the Company.

Real Estate Committee.The Real Estate Committee, which currently consists of Mr. Price, Mr. Laparte, Ms. Bahrambeygui and Mr. Lynn, held sixeleven meetings during fiscal year 2016.2018. The Real Estate Committee reviews and approves the material terms of real estate-related transactions entered into by the Company, consistent with the applicable annual budget of the Company previously approved by the Board of Directors.

Innovation Committee. The Innovation Committee, which currently consists of Mr. Price, Ms. Bahrambeygui, Ms. Infante and Mr. Janks, held six meetings during fiscal year 2018. The Innovation Committee is responsible for overseeing and providing counsel on matters of innovation and technology. The Committee is responsible for reviewing and making recommendations to the Board relating to the Company’s approach to technical and commercial innovation, the acquisition and implementation of new technologies to ensure growth and continuing delivery of value to our members and the implementation of measurement and tracking systems. In addition, the Committee is responsible for fostering a culture of entrepreneurship and innovation, which may include disruption of how this business format has operated for over four decades.

Policy Governing Stockholder Communications with the Board of Directors

The Board of Directors welcomes communications from stockholders of the Company. Any stockholder who wishes to communicate with the Board of Directors or one or more members of the Board of Directors should do so in writing in care of the General Counsel of the Company, at the principal office of the Company, 9740 Scranton Road, San Diego, California 92121. The General Counsel is directed to forward each communication to the director or directors of the Company for whom it is intended.

Policy Governing Director Attendance at Annual Meetings of Stockholders

The Company encourages, but does not require, the members of its Board of Directors to attend the annual meeting of stockholders. All teneleven members then-serving on the Board of Directors attended the Annual Meeting of Stockholders held on February 3, 2016.January 24, 2018.

Audit Committee Report

The Audit Committee oversees the Company’s financial accounting and reporting process and the audits of the financial statements of the Company. All committee members satisfy the definition of independent director set forth atin Rule 5605(a)(2) and Rule 5605(c)(2) of the Nasdaq Stock Market’s listing standards. The Audit Committee is governed by a written charter adopted by the Board of Directors, which is available on the Company’s public website atwww.pricesmart.com.

In fulfilling its oversight responsibilities, the committee reviewed and discussed with management the audited financial statements in the Company’s Annual Report on Form10-K for the year ended August 31, 2016,2018, including a discussion of the quality, and not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the financial statements.

The Company’s independent registered public accounting firm, Ernst & Young LLP (EY)(“EY”), is responsible for expressing an opinion on the conformity of its audited financial statements with generally accepted accounting principles. EY met with the committee and expressed its judgment as to the quality, not just the acceptability, of the Company’s accounting principles and discussed with the committee other matters as required under generally accepted auditing standards, including those matters required to be discussed by Public Company Accounting Oversight Board Statement on Auditing Standards No. 16Communications with Audit Committees. In addition, EY discussed the accountants’ independence from the Company and from the Company’s management and delivered to the committee those matters to be set forth in written disclosures as required by applicable requirements of the Public Company Accounting Oversight Board regarding independent registered public accounting firm’s communications with the Audit Committee concerning independence.

The committee discussed with the Company’s independent registered public accounting firm the overall scope and plan of their audit. The committee meets with the independent registered public accounting firm, with and without our management present, to discuss the results of their examinations, their evaluations of the Company’s internal controls, and the overall quality of the Company’s financial reporting.

In reliance on the reviews and discussions referred to above, the committee recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form10-K for the year ended August 31, 20162018 for filing with the SEC.

This report of the Audit Committee shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates this information by reference, and shall not otherwise be deemed filed under such acts.

Leon C. Janks

Gonzalo Barrutieta

Katherine HensleyBeatriz Infante

Gary Malino

Securities Ownership of Certain Beneficial Owners and Management

The following table sets forth certain information regarding the beneficial ownership of the Company’s Common Stock as of October 31, 2016November 30, 2018 by (1) each of its directors and nominees for director, (2) each of its Named Executive Officers, (3) each person or group known by it to own beneficially more than 5% of the Common Stock and (4) all directors and executive officers as a group.

Securities Ownership of Certain Beneficial Owners and Management (continued)

Securities Ownership of Certain Beneficial Owners and Management (continued)

Executive Officers of the Company

The executive officers of the Company and their ages as of October 31, 2016November 30, 2018 are as follows:

Jose Luis LaparteSherry S. Bahrambeygui has been a director of the Company since February 2008,Interim Chief Executive Officer of the Company since November 2018 and has served as a director of the Company since November 2011. During her tenure on the Board, Ms. Bahrambeygui has been an instrumental component of the evolution of the Company’s governance and has led several efforts of strategic importance to the Company, including identification and recruitment of key talent for executive leadership, execution of strategic negotiations, and leading the acquisition of the technology and online business, Aeropost, Inc. Ms. Bahrambeygui served as Vice Chair of the Board from October 2016 to October 2017. Ms. Bahrambeygui has served as a Senior Executive and Managing Member of The Price Group, LLC since January 2007, serves as Executive Vice President, Secretary and Vice Chairman of the Boards of Price Charities and Price Philanthropies Foundation, and is the Chief Executive Officer of PS Ivanhoe, LLC, a commercial real estate investment company. Ms. Bahrambeygui was a founding partner of the law firm Bahrambeygui & Hosey LLP and practiced law with an emphasis on international business, corporate and employment law. In this capacity prior to joining the Board of Directors, Ms. Bahrambeygui represented the Company in several complex litigation matters achieving favorable outcomes. Ms. Bahrambeygui studied at Columbia University and graduated with a B.A. from the University of California San Diego and a J.D. from California Western School of Law. Ms. Bahrambeygui’s thorough understanding of the business and operations of the Company, extensive knowledge of international business and investments, as well as having effectively assisted the Company on a variety of complex business matters, contribute to the Board of Directors’ conclusion that she should serve as a director of the Company.

Maarten O. Jagerhas been Executive Vice President and Chief Financial Officer of the Company since April 2018. Prior to joining PriceSmart, Mr. Jager served at Walmart from 2014 to 2018. During his tenure at Walmart, he served as Senior Vice President and Chief Financial Officer of Sam’s Club from 2015 to 2018 and as Senior Vice President and Chief Financial Officer of its Asia division from 2014 to 2015 among other senior roles. Mr. Jager worked 14 years at Booz Allen Hamilton Inc., the general management consulting firm, prior to devoting six more years to Diageo North America Inc. to oversee various strategic and financial responsibilities. Mr. Jager holds an MBA degree from the University of Chicago and engineering degrees from Stanford University and the University of Michigan.

William J. Naylon has been Executive Vice President and Chief Operating Officer of the Company since January 2002. Mr. Naylon served as Executive Vice President—Merchandising of the Company from July 20102001 until January 2002 and as Senior Vice President of the Company since October 2004. from March 1998 until July 2001. From September 1995 through February 1998,

Executive Officers of the Company (continued)

Mr. Laparte initially served as a consultantNaylon was Managing Director for the Company from December 2003 to October 2004.Company’s licensee warehouse club operation in Indonesia. Prior to joining the Company, Mr. Naylon was a General Manager for Price/Costco and served in various management roles for The Price Company.

Francisco Velasco has been Executive Vice President, General Counsel and Secretary of the Company since July 2016 and Chief Ethics & Compliance Officer since October 2016. From March 2009 to June 2016, Mr. Velasco served as Division Counsel Latin America for AbbVie Inc., a publicly traded global biopharmaceutical company. Previously, he heldin-house legal roles at Abbott Laboratories, Hanes Brands Inc. and Sara Lee Corporation, and he began his career in private practice specializing in the Latin America region. Mr. Velasco attended law school in Mexico, has a Masters of Law degree from Georgetown University and has an MBA degree from Duke University.

Ana Luisa Bianchi has been Executive Vice President—Chief Merchandising Officer since August 2018 and was Senior Vice President—Merchandising—Latin America Local from October 2016 through July 2018. From 2010 to October 2016, Ms. Bianchi was Vice President—Merchandising, overseeing the local side of the Colombia business. Ms. Bianchi previously served as regional buyer for the Central America operations from 2007 to 2010. From 2005 to 2007, Ms. Bianchi was local buyer for the Guatemala operations. In 2004, Ms. Bianchi was a consultant to PriceSmart’s St. Thomas operations. In 2003, Ms. Bianchi served as Merchandising Director for U.S. food purchases. From 1999 to 2003, Ms. Bianchi served as the food and candy buyer in the Miami corporate office. Ms. Bianchi joined PriceSmart in 1998 as a consultant, Mr. Laparte workedlocal buyer for more than 14 years at Wal-Mart Stores, Inc.the Guatemala operations. Ms. Bianchi has a law degree in Mexico and the United States in progressively responsible positions. From October 2002 through September 2003, he served as Vice President of Sam’s International, where he directed and managed the company’s operations, finance, sales, marketing, product development and merchandising. From May 2000 to October 2002, he served as Vice President, Wal-Mart de Mexico, responsible for sales and the expansion of the Sam’s Club format in Mexico.Guatemala from Universidad Rafael Landívar.

Rodrigo Calvo has been Executive Vice President—Real Estate of the Company since June 2015. Mr. Calvo2015 and served as Senior Vice President—Real EstatePresident of the Company from January 2009 to June 2015 and was the Company’s Vice President—Real Estate from February 2009 after joining PriceSmart in October 2004 as Director of Real Estate. Before coming to January 2009. From 2001 to 2004, Mr. Calvo worked in the Company, he led Grupo Promerica’s real estate development businessdivision. Before that, he worked for McDonald’s Corporation’s real estate area and for CSU (now Walmart Central America) in special projects. This combined background allowed him to develop a deep understanding of the commercial real estate field in Central America and the Dominican Republic. He holds a bachelors of science degree in civil engineering from 1994 to 1997 in engineeringthe University of Costa Rica and construction.an MBA from INCAE Business School.

Frank Diaz has been Executive Vice President—Logistics and Distribution since November 2015. Mr. Diaz previously served as Senior Vice President—LogisticsPresident of Distribution and DistributionLogistics from February 2010 to October 2015 and was the Company’s Vice President—Logistics and Distribution fromuntil November 2015. He joined PriceSmart in September 2008 to February 2010.as Vice President of Logistics. Prior to joining the Company, Mr. Diaz worked more than 20 years in progressively responsible positions in the areas of logistics operations, strategic planning and commercial development and customer experience withtop-tier logistics companies including United Parcel Service, Federal ExpressUPS, FedEx and DHL.CS Integrated LLC. With DHL, Mr. Diaz was head of transformational programs involving international tradelane development and improved customer experience. Mr. Diaz has a bachelors of science degree in industrial engineering from the New Jersey Institute of Technology and a logistics management certification from the Georgia Institute of Technology.

Brud E. Drachman has been Executive Vice President—Construction and Facilities since August 2013, was Executive Vice President—Construction Management of the Company from November 2005 until July 2013, served as Executive Vice President—Real Estate and Construction of the Company from February 2005 through October 2005 and as Executive Vice President—Construction and Private Label Merchandising from November 2004 until January 2005. Mr. Drachman served as Executive Vice President—Real Estate and Construction of the Company from November 2002 until October 2004 and served as Senior Vice President—Real Estate and Construction of the Company from August 1998 to October 2002. Mr. Drachman previously served as Vice President—Real Estate and Construction at PEIPrice Enterprises from August 1994 to August 1997. Prior to joining PEIPrice Enterprises in 1994, Mr. Drachman served as Project Manager at TPCThe Price Company beginning in 1987.

John M. Heffner has been Executive Vice President and Chief Financial Officer of the Company since January 2004, after having served as a consultant to the Company on financial matters from September 2003 through December 2003. From February 2000 until August 2003, Mr. Heffner was Vice President of Finance and Chief Financial Officer of Kyocera Wireless

Executive Officers of the Company (continued)

Corp. Mr. Heffner’s previous professional experience was with Digital Equipment Corporation, where he held a variety of financial management roles over a 20-year period, and with QUALCOMM Incorporated, where he was a Vice President of Finance from July 1998 until February 2000.

John D. Hildebrandt has been Executive Vice President—Operations of the Company since February 2010. Mr. Hildebrandt served as Executive Vice President—Central America and Trinidad Operations from March 2009 through January 2010, as Executive Vice President—Central America Operations from August 2003 until February 2009, as Executive Vice President—

Executive Officers of the Company (continued)

Caribbean and Asia Operations from July 2001 until July 2003 and as Senior Vice President of the Company from September 2000 until July 2001. Mr. Hildebrandt previously served as Vice President of the Company from September 1998 until August 2000, overseeing operations in Central America. Mr. Hildebrandt served as the Company’s Country Manager in the Philippines and Panama from August 1997 until August 1998, and as PEI’sPrice Enterprises’ Country Manager in the Philippines and Panama from 1996 until the Company was spun off from PEIPrice Enterprises in August 1997. Prior to joining PEIPrice Enterprises as Country Manager in 1996, Mr. Hildebrandt was a Senior Operations Manager of Price/Costco from 1994 through 1996, and served in various management roles for TPCThe Price Company beginning in 1979.

William J. NaylonLaura Santana has been Executive Vice President and Chief Operating Officer of the CompanyPresident—Information Technology since January 2002. Mr. NaylonMarch 2017. Ms. Santana has served as Executive Vice President—Merchandising of the Company from July 2001 until January 2002 and as Senior Vice President of the Company from March 1998 until July 2001. From September 1995 through February 1998, Mr. Naylon was Managing Director forin progressively responsible positions relating to the Company’s licensee warehouse club operation in Indonesia. Prior toIT systems since joining the Company Mr. Naylon wasin 1995. Ms. Santana previously worked at The Price Company from 1987 to 1995 in operations and information technology. Ms. Santana is a General Manager for Price/Costco and served in various management roles for TPC.

Francisco Velasco has been Executive Vice President, General Counsel and Secretarygraduate of the Company since July 2016 and Chief Ethics & Compliance Officer since October 2016. From June 2009 to June 2016, Mr. Velasco served as Regional Counsel Latin America for AbbVie Inc., a publicly traded global biopharmaceutical company. At AbbVie, Mr. Velasco was responsible for its legal affairs in Latin America, managing over a dozen in-house counsel plus supporting staff covering over 20 countries. Mr. Velasco attended law school in Mexico, has a MastersUniversity of Law degree from Georgetown University and has an MBA degree from Duke University.San Diego.

Jesus Von Chonghas been Executive Vice President—Local/Regional Buying—Central America/Caribbean/Colombia since August 2018. He previously served as Executive Vice President—Chief Merchandising Officer sincefrom September 2016 through July 2018 and was Executive Vice President—Foods Merchandising from November 2015 through August 2016. HeMr. Von Chong served as Senior Vice President of Merchandising for Central America beginning in 2003, added Colombia to his responsibilities in March 2011 and the Caribbean Region in April 2015. He served as a Regional Merchandising Director for Panama, Costa Rica and Dominican Republic in 2000.from 2000 to 2003. He was first employed by the Company as a Buyerbuyer in the Company’s operations in Panama in 1996. Mr. Von Chong progressed to head Buyer in 1998, Warehouse Manager for Via Brasil Operations in 1999 and to Panama’s Country Manager in 2000.

Executive and Director Compensation

Compensation Discussion and Analysis

The Compensation Committee of our Board of Directors, comprised entirely of independent directors, administers the Company’s executive compensation program. The role of the Compensation Committee is to oversee compensation and benefit plans and policies, administer stock plans, and review and approve annually all compensation decisions relating to all executive officers.

Purposes and Structure of the Executive Compensation Program

The executive compensation program is designed to:

To achieve these objectives, the Compensation Committee, which is comprised of members who have knowledge of executive compensation levels of other companies by virtue of their professional background, experience and dealings external to PriceSmart,the Company, has implemented compensation plans that provide a competitive salary and align compensation with the achievement of long-term financial and operational goals.

In fiscal year 2016, the compensation of our Named Executive Officers was comprised of base salaries and long-term equity incentives in the form of restricted stock. The structure for fiscal year 2016 was a change from prior years when a portion of our Named Executive Officers’ compensation included an annual bonus based upon achievement of certain short-term levels of operating income and sales performance. The annual bonus as a percentage of total cash compensation for the three years preceding fiscal year 2016 ranged from 13.1% to 20.9% for our Named Executive Officers other than the Chief Executive Officer and President, and from 15.6% to 25.3% for our Chief Executive Officer and President. The Compensation Committee determined that our Named Executive Officers played an important and strategic role in guiding the Company toward sustainable and long-term success that could more effectively be incentivized by eliminating the annual bonus and increasing the long-term equity component of Named Executive Officers’ compensation. Equity grants to our executives vest with continued service over multiple years. This “over time” multi-year approach closely reflects the long-term orientation inherent in our membership-based business model. Further, the Compensation Committee’s administration of the annual cash incentive program has been challenged in recent years by economic variability and fluctuations in currency exchange rates in certain of PriceSmart’s principal business markets that resulted in financial outcomes unrelated to the performance of management. Equity grants, with their longer-term orientation to Company performance and pay delivery, can help manage through this variability. Finally, equity compensation underscores the alignment of our executives and stockholders over time, enhancing the ownership ethic. In moving away from formal annual incentive opportunities, the Committee determined it was appropriate to increase base salaries for our Named Executive Officers to insure that their cash compensation was competitive in the market and reflective of their on-going contribution.stockholder returns.

In determining specific amounts and components of compensation, the Compensation Committee considered each officer’s performance, level of responsibility, skills and experience, and other compensation awards or arrangements, as more fully described below under “Elements of Compensation.”

Compensation Determination Process

Each year the Compensation Committee relies on multiple data points to assess the competitiveness of our executive compensation program and the individual compensation of our executives. Information the Compensation Committee uses to perform this analysis includes:

The Compensation Committee reviews and approves all elements of compensation for all Named Executive Officers taking into consideration recommendations from management. The Compensation Committee also reviews and approves all equity awards for all executives and equity awards for all employees. The Company’s Chairman makes recommendations to the Compensation

Executive and Director Compensation (continued)

Committee with respect to salary and restricted stock for the Chief Executive Officer and President, and the Chief Executive Officer and President makes recommendations to the Compensation Committee with respect to salary and restricted stock for the Executive Vice Presidents. The Chief Executive Officer and President alsoManagement provides information to the Committee members at their request to aid in their decision-making. The information includes historical cash compensation and stock grants to PriceSmartthe Company’s executives, internal equity comparisons, and the financial impact to the Company of a particular compensation decision.decisions. The Compensation Committee also receives comparable company compensation information, as described below.

During fiscal year 2018, the Company’s Chairman made recommendations to the Compensation Committee with respect to salary and restricted stock for the Chief Executive Officer and President, and the Chief Executive Officer and President made recommendations to the Compensation Committee with respect to salary and restricted stock for the Executive Vice Presidents. In addition, the Compensation Committee regularly engages an independent compensation consultant to conduct market reviews of our competitive market for executive talent. The Committee engaged Semler Brossy Consulting Group to conduct a review of market data for use in determining fiscal 2019 compensation levels and to provide recommendations on instituting a

Executive and Director Compensation (continued)

long-term performance-based compensation structure, in response to stockholder input. After gathering this input and receiving these recommendations, the Compensation Committee determinesdetermined the compensation of our Named Executive Officers in executive session. In the case of employees below the level of Executive Vice President, the Chief Executive Officer and President, setsworking with other members of management, set their cash compensation and makesmade recommendations to the Compensation Committee with respect to equity awards.

Except for the decision by the Compensation Committee to increase salaries and eliminate annual bonuses beginning in fiscal year 2016, theThe Compensation Committee has not adopted any formal or informal policies or guidelines for allocating compensation between long-termannual and currently paid outlong-term compensation, between cash andnon-cash compensation, or among different forms of compensation. However, the Compensation Committee believes that long-term compensation plays an increasingly important role in encouraging positive results through collaboration, aligning the compensation of the senior management team to stockholder returns and in the retention ofretaining key executives. In particular, the Compensation Committee believes that the Chief Executive Officer and President’sOfficer’s compensation should be more heavily weighted towards long-term incentives as compared to other members of senior management given his or her greater ability to affect the results of the Company and the importance of retaining his or her services.

The following table sets forth executive compensation and governance policies and practices we have implemented to advance the objectives of our executive compensation program and to align our practices and policies with industry-leading standards.

Executive and Director Compensation (continued)

Comparison of Short-Term Compensation and Long-Term, Equity-Based Compensation

The charts below show the percentage breakdown of short-term compensation (comprised of salary, dividends paid on restricted stock, 401(k) contribution by the Company and miscellaneous perquisites) and long-term, equity-based compensation (comprised of the dollar value of restricted stock awards that vested during the fiscal year based on the market value on the vesting date) for fiscal year 2018 for our former Chief Executive Officer and President and for the other Named Executive Officers.

Components of CEO Compensation Short-Term Compensation Long-Term Compensation Components of Other NEO Compensation Short-Term Compensation Long-Term Compensation

Performance Evaluation Process

The Compensation Committee and our Chief Executive Officer generally consider the following objective and subjective factors when evaluating the performance of our executive officers:

The Compensation Committee and our Chief Executive Officer do not assign any of these performance factors a specific weight, but they seek to strike an appropriate balance each year and for each executive. Further, the Compensation Committee and Chief Executive Officer may consider different factors for each executive.

Use of Independent Compensation Consultant

In fiscal year 2016,2018, the Compensation Committee retained Semler Brossy Consulting Group as its independent executive compensation consultant. Semler Brossy has no other business relationship with PriceSmartthe Company and receives no payments from us other than the fees for services to the Compensation Committee. Semler Brossy reports directly to the Compensation Committee, and the Compensation Committee may replace Semler Brossy or hire additional consultants at any time.

Executive and Director Compensation (continued)

During fiscal year 2016,2018, the scope of Semler Brossy’s engagement included:

Role of Comparable Company Compensation Information in the Compensation Determination Process

The Compensation Committee establishes individual executive compensation at levels the Compensation Committee believes are comparable with those of executives in other companies of similar size and stage of development operating in retail industries, and similarly sized public companies in the Southern California region, taking into account our relative performanceown strategic goals and our own strategic goals.relative performance. Management utilized Equilar Inc.’s Executive Insight research database, a resource for referencing executive compensation and analyzing executive pay trends based on information Equilar gathers from proxy statements and reports filed with the Securities and Exchange Commission, and additional competitive information provided by our compensation consultant, Semler Brossy,Brossy.

The most directly comparable companies to aidPriceSmart are Costco Wholesale Corporation, Sam’s Club and BJ’s Wholesale Club Holdings, Inc. These corporations’ sizes relative to PriceSmart’s makes comparisons impractical for executive compensation purposes. In addition, comparable compensation data for Sam’s Club is not publicly available, and comparable compensation information has not been available for BJ’s until July 2018. Accordingly, the Compensation Committee determined that for fiscal 2018 our Named Executive Officers’ compensation should be compared to compensation of executives at public companies Institutional Shareholder Services included in the identification ofits most recent benchmarking analysis for PriceSmart. ISS uses a peer group comprised of publicly tradedthe 16 public companies so thatin the same SIC code as PriceSmart, with revenues between $1.6 billion and $8 billion and employees between 1,500 and 40,000. The Compensation Committee could consider competitive market data in determiningadopted the Named Executive Officers’ fiscal 2016 compensation

Executive and Director Compensation (continued)

program and compensation levels. Whilesame group, except that it is difficult to ascertain directly comparable companies given the unique characteristicsexcluded Sears Hometown & Outlet Stores, Inc. because of PriceSmart’s international warehouse club business, in establishing fiscal 2016 compensation levels for the Named Executive Officers, the Compensation Committee evaluated the compensation practicesits recent bankruptcy filing. The peer group, excluding Sears, consists of the following public company peer groups:15 companies:

The public companies included in our new peer groupsgroup to change as companies move into and out of the annual revenue ranges or cease to be publicly traded. Our peer groups for fiscal year 2015 included 99 Cents Only Stores and The Active Network, Inc., which are no longer publicly traded. There were no other changes to our peer groups between fiscal year 2015 and fiscal year 2016.

In addition, moving forward, the Compensation Committee reviewedwill review the peer group each year, and consideredit may make changes from time to time to ensure the compensation practices of Costco Wholesale Corporation because the Company’s business is similar to Costco’s. However, the Compensation Committee took into account Costco’s significantly larger sizegroup remains current and world-wide operations compared to the Company’s in making comparisons aboutmeaningful for benchmarking executive compensation.pay levels and practices.

As part of thisits compensation program review process, the Compensation Committee reviewsassesses the mix of the compensation elements for theour Named Executive Officers against the compensation data from Equilar, andas well as information from Semler Brossy,

Executive and Director Compensation (continued)

for positions similar to those held by such officerspositions within the peer group of companies and Costco.group. The Compensation Committee noted that there was substantial variation between the compensation levels of similarly situated Named Executive Officers across the comparable companies.executives. In particular, the Compensation Committee noted that long-term equity compensation varied significantlycompany-to-company resulting from as a result of differences in the frequency and timing of equity awards made to executives.grants. As a result, the Compensation Committee focused on the competitiveness of PriceSmart’s cash compensation aspect of overall compensation of other companies’ executives relative to our Named Executive Officers’ cash compensation.peer companies. The Compensation Committee determined that the cash compensation offor our Named Executive Officers was below the midpoint of the similarly titled executives at the comparable companiescompetitive midpoints, and therefore, concluded that the compensation was not excessive.

The Named Executive Officers are all employees of PriceSmart, Inc. and work and reside in the U.S. (either San Diego, California or in the case of Mr. Naylon and Mr. Hildebrandt, Miami, Florida). As such, the Compensation Committee concluded that the competition for executive talent for the Company’s namedcompensation to PriceSmart executives would likely be either similarly sized U.S. headquartered companies in the retail industry and/or similarly sized companies in varying industries located in Southern California. PriceSmart had to use a broader annual revenue range for U.S. retail companies than for Southern California companies to get an adequate sample of broad line retailers.was not excessive.

Based on the objectives outlined above, the Compensation Committee strives to set target total compensation opportunity levels and the individual components of compensation to be competitive with the market in which we compete for executive talent. The Compensation Committee does not, however, guarantee thattarget any executive will receive a specific market-derivedpercentile of market compensation level.levels.

Compensation data for the peer group of companies is only one of the many factors the Compensation Committee considers in setting compensation for PriceSmart’s Named Executive Officers, and actual compensation may vary based on the Compensation Committee’s review of other considerations, including the Company’s and the individual Named Executive Officer’s performance and the value of the executive’s leadership and other skills to the Company.

Executive and Director Compensation (continued)

Elements of Compensation

In fiscal year 2018, the compensation of our Named Executive Officer compensation duringOfficers was comprised of base salaries and long-term, equity-based incentives in the form of restricted stock awards and, in the case of two executives, performance stock units. Prior to fiscal year 2016, consisteda portion of our Named Executive Officers’ compensation included an annual cash bonus based upon achievement of certain short-term levels of operating income and sales performance. In fiscal year 2016, the Compensation Committee determined that our Named Executive Officers played an important and strategic role in guiding the Company toward sustainable and long-term success that could more effectively be incentivized by eliminating the annual cash bonus and increasing the long-term equity component of Named Executive Officers’ compensation. Equity grants to our executives vest with continued service over multiple years. This multi-year approach closely reflects the long-term orientation inherent in our membership-based business model. Further, the Compensation Committee’s administration of the following elements:annual cash incentive program had been challenging because of economic variability and fluctuations in currency exchange rates in certain of the Company’s principal business markets that resulted in financial outcomes unrelated to the performance of management. The Compensation Committee determined that equity grants could help manage through this variability. Finally, equity compensation underscores the alignment of our executives and stockholders over time, enhancing an ethic of ownership within our executive team.

Base Salary. Base salaries for the Named Executive Officers were initially established either when they were hired into the position from outside the Company or as they were promoted to increasing levels of responsibility within the Company. Base salaries for the Named Executive Officers are generally established based on the scope of their responsibilities, level of experience and individual performance, taking into account both external competitiveness and internal equity considerations. While the goal for the base salary component is to compensate executives at a level that is competitive with the salaries of executives in comparable positions among our peer group, the Compensation Committee does not attempt to set base salaries at a certain target percentile within the peer group. Instead, the Compensation Committee considers the peer groupexternal market information as merely a means by whichonly to confirm that its base salary determinations based on the other factors described above are competitive within the peer group. In September 2015, at the time the annual management bonus program for fiscal 2016 would have been adopted, the Compensation Committee reset the annual base salary of each of the Named Executive Officers to compensate for the elimination of the annual bonus. The Compensation Committee considered the actual bonus payments made to the named executives over the previous three fiscal years. They ranged from 15.0% to 26.2% of annual salary for the Named Executive Officers, excluding the Chief Executive Officer, and from 18.3% to 33.6% of annual salary for the Chief Executive Officer. The Committee determined that an 18% increase in annual pay for the Named Executive Officers and the Chief Executive Officer was appropriate to insure a competitive level of cash compensation without the annual bonus.competitive.

The Compensation Committee annually evaluates the base salary levels of the Named Executive Officers to ensure that there is consistency within the Company based upon scope of responsibility and also to ensure that the base salaries are not excessive relative to the peer companies listed above. In establishing changes to base salaries, the Compensation Committee may consider the overall financial condition of the Company but does not make changes to executive salaries based on the achievement of any particular financial criteria.

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In January 2016,2018, all of the Named Executive Officers received increases to their base salaries of 3%2%. The increase in base pay fornon-executive U.S.-based employees within the Company was 3%. Mr. Laparte received an increase of $21,300,$15,064, Mr. Heffner received an increase of $12,540,$8,869, Mr. Naylon received an increase of $15,180,$10,737, Mr. MartinVelasco received an increase of $13,290$8,446 and Mr. HildebrandtVon Chong received an increase of $11,760.$8,487. In each case, these increases were intended to maintain base salaries at an appropriate level based upon the Compensation Committee’s review of peer group companies and taking into account general economic inflation.

Long-Term Incentive Compensation. We believe that long-term incentives for higher level executives are consistent with the values and culture of the Company and therefore should be an integral and more importantheavily weighted part of the overall executive compensation program. Our long-term performance will be enhanced through the useDirect linkages of equity awards that reward Company executives for maximizing stockholder value over time. We provide equity incentives through restricted stock awards that vest based on continued employment over the vesting period. The Company does not provide annual restricted stock grants. Rather individual awards are granted from time to time based upon the current level of unvested shares an executive has from previous grants for retention and incentive purposes. In January 2012, the Named Executive Officers other than Mr. Laparte received long-term retention awards that had varying vesting periods related to the ages of such Named Executive Officers, such that final vesting will occur up to but not beyond the executive’s attainment of age 66. These awards at the time they were granted vested over eight years (for Mr. Heffner), and ten years (for Messrs. Naylon, Martin and Hildebrandt). In April 2013, Mr. Laparte received a long-term retention award that provided for vesting in equal amounts in 2016, 2017 and 2018. In November 2015, the Named Executive Officers received long-term retention awards as part of the overall redesign of the compensation program to eliminate annual bonuses and increase long-term incentives. These awards provided for equal vesting over five yearspay with the first vest on August 29, 2016. The award for Mr. Laparte provided for 40% ofCompany’s stock price performance encourages and rewards an owner-operator mindset among the award to vest in equal parts on August 29, 2016, 2017 and 2018 and 60% of the award to vest in equal parts in 2019 and 2020.Company’s executives.

Executive and Director Compensation (continued)

PriceSmart has used restricted stock as the primary long-term incentive vehicle because:

We expect to continue to usePriceSmart historically has awarded restricted stock with time-based vesting to its Named Executive Officers, but the Compensation Committee has determined performance-based equity is an important tool, alongside grants of restricted stock with time-based vesting. In fiscal 2018, the Compensation Committee made the Company’s first-ever grants of performance stock units to Mr. Jager, the Company’s Chief Financial Officer, and Mr. Velasco, the Company’s General Counsel. If the Company achieves revenue or operating income targets specified by the Compensation Committee for fiscal year 2019, these awards will vest in two annual installments in October 2019 and October 2020 subject to the recipient’s continued employment through those vesting dates. The performance stock units have dividend equivalents, but payment of such amounts will be subject to satisfaction of the performance criteria.

In fiscal year 2017, the Compensation Committee decided that the Company should make smaller annual grants of restricted stock vesting over a period of three years instead of the larger, periodic grants vesting over five or more years the Compensation Committee had previously made. In moving to annual awards, the Compensation Committee noted that moving to smaller, but more frequent, awards would give the Compensation Committee greater flexibility to adjust awards to take into account:

The Compensation Committee also noted that annual awards would allow the Company to have better fiscal control of the compensation program; would more easily allow for the implementation ofpay-for-performance metrics; and would help prevent hardship or windfall scenarios in future.

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Despite the Compensation Committee’s determination in fiscal year 2017 to make grants on an annual rather than periodic basis, it elected not to make any grants to our Named Executive Officers in fiscal year 2017 given grants made in fiscal year 2016 under the prior approach. In addition, apart from supplemental grants of time-vesting restricted stock and performance stock units to Mr. Jager and Mr. Velasco, the Compensation Committee also did not make any grants in fiscal year 2018 as it worked with Semler Brossy to incorporate performance-based vesting into at least a portion of the annual equity incentive awards. The Compensation Committee made grants of performance stock units and restricted stock to our Named Executive Officers (other than Mr. Laparte) in October 2018 (fiscal year 2019) and made grants of performance stock units and restricted stock to Ms. Bahrambeygui in November 2018 (fiscal year 2019). The grants to Ms. Bahrambeygui are comprised of 2/3 restricted stock and 1/3 performance stock units with the same performance criteria as the other long-term incentives,executive officer grants and aone-year vesting schedule.

The Compensation Committee believes that, moving forward, these two equity instruments—performance stock units and restricted stock—will work together to further enhanceprovide the connection toCompany’s executives a competitive pay opportunity that focuses executives on maximizing stockholder value over the longer-term.long term.

In determining the number of shares of restricted stock to be granted to our Named Executive Officers, and the vesting schedules applicable to such awards, the Compensation Committee takes into account the individual’s position, scope of responsibility, ability to affect profits and stockholder value, and the value of restricted stock in relation to other elements of the individual executive’s total compensation. All awards of restricted stock are made by the Compensation Committee. We do not have equity ownership requirements or guidelines.

Our Named Executive Officers recognize taxable income from restricted stock when and as shares vest. On each vesting date, the Company repurchases a portion of the shares vesting on such vesting date from the participant to cover the tax obligations triggered by the vesting. The Company repurchases the shares at their fair market value on the date of vesting and pays this amount directly to the taxing authorities. PriceSmartThe Company generally receives a corresponding tax deduction for compensation expense in the year of vesting, subject to limits on the deductibility of compensation in excess of $1.0 million paid to certain executives under Internal Revenue Code Section 162(m) when the compensation does not qualify as “performance-based.”. The amount included in the participant’s wages upon such vesting, and, subject to Section 162(m), the amount we may deduct, is equal to the fair market value of a share of Common Stock on the date the shares vest, multiplied by the number of shares vesting.

Severance and Change in Control PaymentsPayments.. We have entered into agreements and maintain plans that require us to make payments and/or provide benefits to our Named Executive Officers under specified circumstances in the event of a termination of their employment or a change in control. We provide for certain severance benefits in the event that a Named Executive Officer’s employment is involuntarily terminated. Such severance benefits are designed to alleviate the financial impact of an involuntary termination through salary continuation and are intended to provide for a stable work environment. We believe that reasonable severance benefits for our Named Executive Officers are important because it may be difficult for our executive officers to find comparable employment within a short period of time following certain qualifying terminations. In addition to normal severance, we provide for accelerated vesting of all equity awards for all employees in the event of a change in control as a means of reinforcing and encouraging the continued attention and dedication of our employees to their duties of employment without personal distraction or conflict of interest in circumstances which could arise from the occurrence of a change in control. We believe that the interests of stockholders will be best served if the interests of our senior management are aligned with them, and providing thesechange-in-control benefits should eliminate, or at least reduce, the reluctance of senior management to pursue potential change in control transactions that may be in the best interests of stockholders.

The Company provides severance, continuity andchange-in-control benefits because they are essential to help us fulfill our objectives of attracting and retaining key managerial talent. These agreements are intended to be competitive with those of similarly sized companies in our industry and company size and to attract and retain highly qualified individuals. While these arrangements form an integral part of the total compensation provided to these individuals and are considered by the

Executive and Director Compensation (continued)

Compensation Committee when determining executive officer compensation, the decision to offer these benefits did not influence the Compensation Committee’s determinations concerning other direct compensation or benefit levels.

Executive and Director Compensation (continued)

Other Benefits. PriceSmart’s Named Executive Officers are eligible to participate in all of our employee benefit plans, such as our 401(k) plan and our medical, dental, vision, long and short-term disability and life insurance plans, in each case on the same basis as other employees. We also offer our Chief Executive Officer and President a housing allowance and travel benefits in accordance with his employment agreement described below.below, and we reimbursed moving expenses and are providing aone-year housing allowance of $60,000 for our Chief Financial Offer. The Compensation Committee believes that these perquisites are no greater than competitors’ practices.

Say-on-Pay Feedback from Stockholders

At our 2018 Annual Meeting of Stockholders, we sought an advisory vote from our stockholders regarding our executive compensation program and received a 99.7% favorable vote supporting the program, excluding abstentions and brokernon-votes. For fiscal year 2018, the Compensation Committee considered the results of the advisory vote as part of its annual review of the compensation provided to our Named Executive Officers and other executives. The Compensation Committee will continue to consider the outcome of oursay-on-pay votes when making future compensation decisions for the Company’s executive officers.

Stock Ownership Guidelines and Hedging and Pledging Prohibition

To further align executive and stockholder interests, we have adopted stock ownership guidelines for our executives andnon-employee directors. The guidelines require our Chief Executive Officer to hold Common Stock with a value of at least five times his or her base salary and other executive officers to hold Common Stock with a value of at least one times their respective base salaries. The guideline fornon-employee directors is one times their annual cash compensation. Until such time as an executive ornon-employee director satisfies the minimum ownership requirement set forth herein, such executive ornon-employee directors is required to hold 50% of the equity awards (net of amounts required to satisfy any applicable tax obligations arising in connection with the exercise or vesting of any equity award) granted by the Company on or after the date such executive ornon-employee director becomes subject to these guidelines. After an executive ornon-employee director satisfies the minimum ownership requirement as of a measurement date, he or she will be deemed to be in compliance with the stock ownership guidelines notwithstanding subsequent changes in the value of his or her stock ownership, so long as the number of shares deemed held does not decrease (as counted in connection with the foregoing valuation methodology). In addition to the minimum stock ownership requirements, we do not allow our executive officers ornon-employee directors to enter into any hedging, pledging or monetization transactions involving our Common Stock.

Recoupment Policy

We adopted a Compensation Recoupment Policy effective as of September 19, 2017. The recoupment (or “clawback”) policy provides the Compensation Committee with broad discretion to recoup certain incentive awards made to the Company’s executive officers when it determines that (1) an executive engaged in serious misconduct or failed to supervise a subordinate employee who engaged in serious misconduct which the executive knew, or was reckless in not knowing, was occurring, and (2) such misconduct resulted in a material violation of law or a written Company policy that caused significant financial or reputational harm to the Company. This clawback policy is broader than current and expected regulatory requirements. The policy can be found on the Corporate Governance section of our website.

Executive and Director Compensation (continued)

Compensation Committee Report

We have reviewed and discussed with management the Compensation Discussion and Analysis required to be included in this Proxy Statement. Based on the reviews and discussions referred to above, we recommend to the Board of Directors that the Compensation Discussion and Analysis referred to above be included in our Proxy Statement.

The foregoing has been furnished by the Compensation Committee.

Sherry Bahrambeygui

Katherine L. HensleyBeatriz Infante

Leon C. Janks

Pierre MignaultGary Malino

Compensation Committee Interlocks and Insider Participation

The Compensation Committee is comprised of Ms. Bahrambeygui and Ms. Hensley, and Messrs.Infante, Mr. Janks and Mignault.Mr. Malino. Ms. Bahrambeygui served on the Compensation Committee during fiscal year 2018. No interlocking relationship exists between any member of the Compensation Committee and any member of any other company’s Board of Directors or compensation committee.

Executive and Director Compensation (continued)

Executive Compensation

Summary of Compensation

The following table shows information regarding the compensation earned by any person who served as our Chief Executive Officer or Chief Financial Officer during the fiscal year ended August 31, 20162018 and the three other most highly compensated executive officers who were serving as executive officers at August 31, 2016.2018. These persons are referred to as the Company’s “Named Executive Officers” elsewhere in this Proxy Statement.

Executive and Director Compensation (continued)

Executive and Director Compensation (continued)

Grants of Plan-Based Awards

The following table sets forth certain information with respect to grants of plan-based awards for the fiscal year ended August 31, 20162018 to the Named Executive Officers.

Executive and Director Compensation (continued)

Employment Contracts

Effective September 1, 2015,The Company has entered into an employment agreement with Sherry Bahrambeygui’s relating to her service as Interim Chief Executive Officer. The agreement provides for a term beginning on November 16, 2018 and continuing until terminated by either party on 60 days’ prior written notice or by the Company immediately for “cause” or upon Ms. Bahrambeygui’s death or “disability.” The employment agreement specifies a base salary amount of $875,000 per year, which may be increased, but not decreased, at the Company’s discretion. The employment agreement states that Ms. Bahrambeygui is entitled to reimbursement of business expenses and is eligible to receive all other benefits offered to senior executives of the Company under the Company’s benefit practices and plans.

Ms. Bahrambeygui’s employment agreement contemplates the award of restricted stock and performance stock units having an aggregate target value equal to $2.175 million at the time of grant. Such grants will be made concurrent with the commencement of her employment as Interim Chief Executive Officer. The number of shares covered by such grants will be determined based on an average of the closing price for the 30 trading days prior to the date of grant. Of such grants,two-thirds will be comprised of restricted stock awards with time-based vesting andone-third will be comprised of performance stock units. The restricted stock will vest 12 months from the date of grant, provided that if Ms. Bahrambeygui’s employment is terminated by the Company without cause before the completion of the12-month term, she will receive the greater of 50% vesting or pro rata vesting based on the number of days worked during the12-month term. Performance stock units will vest based on the Compensation Committee’s determination in October 2019 that the Company has achieved revenue or operating income targets specified by the Compensation Committee for fiscal year 2019, provided that if one of the performance criteria is achieved but Ms. Bahrambeygui’s employment is terminated without cause before the Compensation Committee makes its determination, she will receive the greater of 50% vesting or pro rata vesting based on the number of days worked. If Ms. Bahrambeygui’s employment is terminated due to her death or disability and such death or disability results from events or circumstances occurring while she is traveling for business inside or outside the United States, her restricted stock will vest in full and her performance stock units will vest in full, subject to the achievement of one of the performance criteria.

In the event that the Company terminates Ms. Bahrambeygui’s employment without “cause” or upon her “disability,” Ms. Bahrambeygui will be entitled to the following separation benefits:

The foregoing separation benefits are the exclusive benefits that would be payable to Ms. Bahrambeygui under her employment agreement by reason of her termination. Payment of the separation benefits is conditioned on Ms. Bahrambeygui’s continued compliance with her obligations with respect to confidentiality,non-solicitation of employees andnon-interference with the Company’s customers and contracts and Ms. Bahrambeygui (or her estate) executing and delivering to the Company a full release of all claims in a form reasonably acceptable to the Company.

Executive and Director Compensation (continued)

If Ms. Bahrambeygui remains in the Interim Chief Executive Officer role into the eleventh month of service, the Compensation Committee will determine her compensation to take effect after completion of the first twelve months of the term of her Employment Agreement based on circumstances at that time.

The Company also has entered into new employment agreements with each of the Named Executive Officersits other executive officers that automatically renew each year unless either the Company or the executive provides at least 60 days’ notice that the Company or executive, as the case may be, wishes to terminate the agreement. On September 1, 2016, these agreements automatically renewed. Each employment agreement specifiedspecifies the base salary in effect on September 1, 2015at the time the agreement was entered into and provides that the amount may be increased, but not decreased, at the Company’s discretion. On September 1, 2015 the Compensation Committee reset the annual base salaries as follows:

Executive and Director Compensation (continued)

The employment agreements state that the executive is eligible to participate in the Company’s bonus plan in effect at the time and to receive all other benefits offered to senior executives of the Company under the Company’s benefit practices and plans. The Company discontinued its annual bonus plan forin fiscal 2016, so there was no payment required to be made thereunder during fiscal 2016.2017 or fiscal 2018.

In addition to termination at the end of the term if one party elects to terminate the agreement, the executive may terminate his or her employment on 60 days’ prior written notice. The Company may terminate the executive’s employment with cause upon immediate notice or without cause upon 30 days’ prior written notice. In the event that (i) the Company terminates an executive’s employment without “cause”; (ii) upon termination due to an executive’s “disability;”“disability”; (iii) the executive terminates his or her employment for “good reason;”reason”; or (iv) the Company elects to cause thenon-renewal of the employment agreement such that it expires at the end of its then-current term, subject to the executive providing a release to the Company, the executive will be entitled to:

Upon an executive’s death, the executive’s estate will be entitled to receive continued contribution of the premium cost for executive’s eligible dependents’ participation in the Company’s group health plan for 12 months and payment of any accrued but any unpaid bonus for year prior to termination and a pro rata bonus for the year of termination (payable when all other bonuses are paid).

The employment agreements also contain confidentiality provisions, restrictions on solicitation of employees and interference with the Company’s customers and contracts, and other terms and conditions customary to executive employment agreements.

In addition to the foregoing, Mr. Laparte’s employment agreement also provides for a $50,000 annual housing allowance, reimbursement for three round trip tickets from San Diego to Mexico City for his wife and children, a total of eight round trips from Mexico City to San Diego, which may be used by any additional family members, and reimbursement of reasonable moving expenses to Mexico upon termination of Mr. Laparte’s employment other than by the Company for “cause” or by Mr. Laparte without “good reason” and without 60 days’ prior notice.

On August 11, 2016, Thomas Martin announced his plans to retire, effective August 31, 2016. He was not entitled to any severance or other payments under his employment agreement.

Equity Incentive Plans

Prior to January 22, 2013, the Company had three active Equity Incentive Plans. On January 22, 2013, the Company adopted the 2013 Equity Incentive Award Plan and agreed not to issue any additional awards under these Prior Plans.prior plans.

2001 Equity Participation Plan

The 2001 Equity Participation Plan of PriceSmart, Inc. (the “2001 Plan”) hashad a total of 18,1029,052 shares outstanding as of October 31, 2016, comprisedNovember 30, 2018, all of 18,102 shareswhich are subject to outstanding and unvested restricted stock units.

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The 2001 Plan provides that in the event of a “Change in Control” or a “Corporate Transaction,” each as defined in the 2001 Plan, each outstanding award shall, immediately prior to the effective date of the Change in Control or Corporate Transaction, automatically become fully vested, exercisable or payable, as applicable, for all of the shares of Common Stock at the time subject to such award and, as applicable, may be exercised for any or all of those shares as fully vested shares of Common Stock.

Executive and Director Compensation (continued)

2002 Equity Participation Plan

The 2002 Equity Participation Plan of PriceSmart, Inc. (the “2002 Plan”) has a total of 197,77184,078 shares outstanding as of October 31, 2016, comprisedNovember 30, 2018, all of options to purchase an aggregate of 16,000 shares of Common Stock at prices ranging from $40.40 to $67.92 per share and 181,771 shareswhich are subject to outstanding and unvested restricted stock awards and restricted stock units.awards.

The 2002 Plan provides that in the event of a “Change in Control” or a “Corporate Transaction,” each as defined in the 2002 Plan, each outstanding award shall, immediately prior to the effective date of the Change in Control or Corporate Transaction, automatically become fully vested, exercisable or payable, as applicable, for all of the shares of Common Stock at the time subject to such award and, as applicable, may be exercised for any or all of those shares as fully vested shares of Common Stock.

2013 Equity Incentive Award Plan

The 2013 Equity Incentive Award Plan of PriceSmart, Inc. (the “2013 Plan”) provides that the Compensation Committee of the Board of Directors or a subcommittee thereof may grant or issue incentive stock options,non-qualified stock options, stock purchase rights, stock appreciation rights, restricted stock, deferred stock, dividend equivalents, performance awards, stock payments and other stock related benefits, or any combination thereof.

The 2013 Plan provides for awards covering up to (1) 600,000 shares of Common Stock plus (2) the number of shares that remained available for issuance under the 1998 Equity Participation Plan of PriceSmart, Inc., the 2001 Plan and the 2002 Plan (collectively, the “Prior Plans”) as of January 22, 2013. The number of shares reserved for issuance under the 2013 Plan increases during the term of the 2013 Plan by the number of shares relating to awards outstanding under the 2013 Plan or any of the Prior Plans that expire, or are forfeited, terminated, cancelled or repurchased, or are settled in cash in lieu of shares. However,shares; however, in no event will more than an aggregate of 1,141,769951,741 shares of our Common Stock be issued under the 2013 Plan. As of October 31, 2016,November 30, 2018, the 2013 Plan provided for the issuance of up to 925,896858,611 shares (including shares originally authorized for issuance under the Prior Plans), with 319,778357,737 shares subject to outstanding and unvested restricted stock awards, and restricted stock units and 606,118performance stock units and 500,874 shares remaining available for future grants.

The 2013 Plan provides that in the event of a “Change in Control” or a “Corporate Transaction,” each as defined in the 2013 Plan, each outstanding award shall, immediately prior to the effective date of the Change in Control or Corporate Transaction, automatically become fully vested, exercisable or payable, as applicable, for all of the shares of Common Stock at the time subject to such award and, as applicable, may be exercised for any or all of those shares as fully vested shares of Common Stock.Stock, subject to prior achievement of vesting criteria in the case of performance stock units.

The Retirement Plan of PriceSmart, Inc.

In 1998, the Company established a retirement plan. The retirement plan is designed to be a “qualified” plan under applicable provisions of the Internal Revenue Code of 1986, as amended, covering all employees, as defined in the retirement plan. Each year, participants may contribute up to 100% per pay period of theirpre-tax annual compensation (as defined in the retirement plan) up to the maximum allowable by the Internal Revenue Code of 1986, as amended. Participants also may contribute amounts representing distributions from other qualified plans. Effective January 1, 2011, the Plan was amended to replace the Company match with a discretionary contribution of 4% of the employee’s eligible compensation up to the IRS maximum

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allowed to all employees regardless of their own salary deferrals. Effective January 1, 2016, the Company began providing up to a 2% matching contribution tonon-officer employees who contribute at least 1% of their eligible pay. Although the Company has not expressed any intent to do so, the Company has the right under the retirement plan to discontinue its contributions at any time and to terminate the retirement plan, subject to the provisions of Employee Retirement Income Security Act of 1974, as amended. All participants in the retirement plan are immediately vested in their accounts and earnings thereon.

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Outstanding Equity Awards at Fiscal Year End

The following table sets forth certain information with respect to outstanding equity awards at August 31, 20162018 with respect to

the Named Executive Officers.