Document:

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                                                              Exhibit 10.5 (b)

                                 AUGUST 16, 1941

                                   15:15 hours

         FIRST PAGE STAMPED IN THE NATIONAL SHOP OF ENGRAVING IN STEEL.

NUMBER SIXTY ONE (61). In the city of Guatemala, the nineteenth (19th) day of
the year two thousand, Before me: GUILLERMO ANDRES CASTILLO RUIZ, Notary,
appears on one hand Mr. JUAN ANTONIO MIRO LLORT, forty six, married, banker,
Salvadorian, of this domicile, who intervenes in capacity of Vice-President and
General Chairman with Representation of Citibank, N. A., capacity accredited
with the following documents, respectively: I) first testimony of the public
document number ninety three (93), authorized in this city the ninth day of
December of the year nineteen hundred ninety eight by Notary Public Fernando
Quezada Toruno, which contains the Protocol Act of Notarial Act authorized by
Notary Karin Johanna Herman Zachrisson the ninth day of July of the year
nineteen hundred ninety eight in the city of New York, State of New York, United
States of America, and contains its appointment as Vice-President. The document
remained duly subscribed in the General Mercantile Registration of the Republic
to number one hundred fifty thousand two hundred twenty nine (150,229) folio
three hundred ninety eight (398) of book seventy five (75) of Auxiliary of
Commerce on the twenty first of December of the year nineteen hundred ninety
eight; and II) first testimony of the public document number forty nine (49)
authorized in this city by Notary Annabella Bruni de Bermudez, the fourth day of
September of the year nineteen hundred ninety six, which contains Protocol of
General Order with representation granted by Citibank, N. A. in favor of Mr.
Juan Antonio Miro Llort, document which remained subscribed in the Offices of
the General Archives of Protocols to number four hundred sixteen thousand eight
hundred thirty seven (416,837), the seventeenth day of September of nineteen
hundred ninety six, the same document remained subscribed in the General
Mercantile Registration of the Republic, with number twenty one thousand five
hundred seventeen (21,517), folio three hundred twenty four (324) of book
fifteen (15) of Orders, with date nineteen of September of nineteen hundred
ninety six. On the other hand, appears Mr. MICHAEL EDWARD ASCOLI GIRON, forty
seven years old, married, Guatemalan, executive, of this domicile, bearer of
personal identification number of order A dash one and

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of registration five hundred fourteen thousand nine hundred eighty five (A-1
514,985) issued by the Municipal Registrar of Guatemala, who acts in their
capacities of: a) GENERAL MANAGER and as such in representation of the entity
PRICESMART (GUATEMALA), SOCIEDAD ANONIMA, which accredits with notarial act of
its appointment authorized in this city the twenty fifth of September of
nineteen hundred ninety eight by Notary Beatriz Beltranena Wer, which is duly
subscribed in the General Mercantile Registration of the Republic with number
one hundred forty four thousand four hundred two (144,402), folio one hundred
twenty one (121) of book seventy five (75) of Auxiliary of Commerce. Likewise,
it states that is duly faculted for the granting of this contract, which
accredits wit Notarial Act authorized in this city the fifteenth of December of
the year two thousand, for which Notary Liliana Yolanda Sanchez Mack, who
transcribes the authorization of the Board of Directors of PRICESMART
(GUATEMALA), SOCIEDAD ANONIMA; and b) GENERAL CHAIRMAN with Representation in
the entity GRUPO SOLID, S. A. (constituted with initials), capacity which
accredits with the first testimony of the public document number thirteen (13),
authorized in the city of Guatemala the fourteenth day of February of nineteen
hundred ninety four by Notary Mario Rodolfo Virula Boy, which Protocols the
Notarial Act dated twenty first of January of nineteen hundred ninety four,
authorized in the city of Panama, Capital of the Republic of Panama, by Notary
Public Tenth, Noemi Moreno Alba, which contains General Order with
Representation granted by GRUPO SOLID, S. A. (Constituted with initials), in
favor of Mr. Michael Edward Ascoli Giron, document which remained subscribed in
the Office of the General Archive of Protocols number four hundred thirty eight
thousand seven hundred fifteen (438,715), the twenty sixth day of February of
nineteen hundred ninety seven; the same document remained subscribed in the
General Mercantile Registration of the Republic, number twenty two thousand
three hundred four (22,304), folio four hundred fifteen (415) of book fifteen
(15) of Orders, dated tenth of March of the year nineteen hundred ninety seven.
ATTEST: to know the first deponent, not as well the second who identifies
himself with personal identity card above identified, that the representations
exercised are enough according to the law and to my judgment for the granting of
this contract; that according to statement made by Messrs. Juan Antonio Miro
Llort and Michael Edward Ascoli Giron, such representations are in effect and
their appointments and orders have not suffered any restriction or amendment
avoiding them or conditioning the

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granting of this document; that I have at sight the documents accrediting them;
and assuring that all are in the free exercise of their civil rights, state that
hereby they grant the CONTRACT OF CREDIT AND CONSTITUTION PLEDGE GUARANTEE OVER
THE MERCANTILE COMPANY according to the following clauses: FIRST: BACKGROUND.
Messrs. Juan Antonio Miro and Michael Edward Ascoli Giron state that CITIBANK,
N. A. through its INTERNATIONAL BANKING FACILITY ("INTERNATIONAL BANKING
FACILITY" or "IBF") constitutes a set of accounting books used by Citibank, N.
A. according to the Regulation D issued by the Board of Governors of the System
of Federal Reserve of the United States of America, entity that hereinafter this
document shall also be named "THE BANK", grants a credit to PRICESMART
(GUATEMALA), SOCIEDAD ANONIMA, entity that in this document shall also be
identified as THE DEBTOR, for the amount of ONE MILLION FIVE HUNDRED THOUSAND
DOLLARS OF THE UNITED STATES OF AMERICA ($1,500,000.00), which will be disbursed
and delivered to the Debtor the next following day of the date in which the
testimony of this document is presented to the Bank indicating the reason of the
subscription of the pledge guarantees placed by the General Mercantile
Registrator of the Republic in the indicated manner hereinafter, as
certification of the same Registration of the Mercantile Companies encumbered
and that the pledge to which this document refers are in first place. The date
of the joint presentation of these documents shall be the one on the receipt
stamp of the Bank. SECOND: STIPULATIONS OF CREDIT. The referred credit in the
above clause is subject, along others, to the following stipulations: a)
Destination: The debtor shall destine the credit to refinance debts with the
shareholders. B) Term: The term of the credit is ONE (1) YEAR counted upon on
this day, for which it will expire the eighteenth of December of the year two
thousand one. If such date is holiday, the period shall conclude the immediate
previous banking working day. C) Payment Method: The Debtor shall pay the credit
in the following manner: THREE (3) QUARTERLY AND CONSECUTIVE PAYMENT OF ONE
HUNDRED TWELVE THOUSAND FIVE HUNDRED DOLLARS OF THE UNITED STATES OF AMERICA
($112,500) EACH, IN MONTHS OF MARCH, JUNE AND SEPTEMBER ALL OF YEAR TWO THOUSAND
ONE; AND THE BALANCE UPON EXPIRATION OF THE CURRENT OBLIGATION. Such amounts do
not include the interests pertaining to the period of time

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elapsed, and the payments shall be made the last working day of the month to
which corresponds the payment of capital, according to what is established in
this clause. During the period of this contract, it is not permitted to the
Debtor to make anticipated payments of capital during the Periods of Interests
(as defined hereinafter), agreed. If notwithstanding this prohibition, the
debtor expresses the desire to make anticipated advance of capital, it is bound
to pay a recharge that the bank may impose over such anticipated payment. d)
INTERESTS: Over the amount owed or their balances shall pay interest at rate
equal to the rate offered for the deposits equal or close to NINETY (90)
CALENDAR DAYS, in Dollars of the United States of America in the Interbanking
Market of London, United Kingdom (LIBO RATE), at eleven hours in the morning,
London time, the second previous working day prior to the beginning of the
period of interests to which the rate will be applied, increasing in THREE POINT
SEVENTY FIVE percentage points (3.75%), as appears on page three thousand seven
hundred fifty (3750) of Telerate. If Libro Rate cannot be determined according
to what is above established, Libo Rate shall mean an annual rate equal to the
rate indicated in page "LIBOR" of the Reuters Screen (or any other page which
substitutes the mentioned page from time to time) upon eleven hours before noon
(11:00 A.M.) (London Time) the second previous working day prior to the
beginning of the period of interests to which the rate will be applied, for
deposits in Dollars of the United States equal or closer to the duration of such
interest period. In the event that one or more interest rates appear on page
three thousand seven hundred fifty (3750) or "LIBOR" as the case may be, the
Libo Rate shall be the average (rounded to the superior multiple number closer
to the 1/16 of the 1% annual, if such average is not a multiple) of such rates
offered. For the effects of this clause, `Period of Interest' shall mean the
period beginning the nineteenth of December of the year two thousand and ends
three months after, that is, the nineteenth of March of the year two thousand,
and ends each consecutive period of three months, beginning on the date of
expiration of the immediate pervious interest period. Interests shall be paid in
MONTHLY manner the last working day of each of the indicated months. The
variation in the interest rate for each period of interests shall make effect
automatically without need of any formal requirement, although, for the effects
purely informative, it shall be sent to the debtor a written communication to
the address stated in this document. The interests shall be calculated based on
one year of three hundred sixty (360) days and collected for those days
effectively elapsed in the period in which

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such interests are payable. E) Moratorium Interests: In the event that the
debtor incurs in moratorium any of the obligations corresponding by virtue of
the credit, shall pay over the balances owed, moratorium interests at an
interest rate equal to the LIBO rate defined in the above clause, in effect on
the date of payment, increased in SEVEN POINT FIFTY percentage point (7.50%),
which shall be calculated upon the first date in which has incurred the
moratorium until the date in which the bank receives upon complete satisfaction
the amounts owed, and without prejudice to the right f this to give as expired
in anticipation the period of the contract and demand judicially the payment of
the obligation. F) Common dispositions to the payment method. The capital and
interests shall be paid in Dollars of the United States of America since it is
an obligation of payment from Guatemala to abroad, without need of collection or
requirement in the account of the Bank that the first indicates to the Debtor,
in the offices located in the City of New York, State of New York, United States
of America, that the Debtor already knows, or in the offices of the branch in
Guatemala on the date in which corresponds to make the payment according to the
credit. The payments of capital and interests in all cases, shall be made on or
before twelve hours, hour of the city of New York, State of New York of the
United States of America. In the event that a date of expiration is a banking
holiday, the obligation shall be complied the first previous working day and the
interest shall be calculated and paid until such date. A banking holiday is a
day in which the banks will not serve the public in the State of New York,
United States of America and in the City of Guatemala, Republic of Guatemala.
All payment that must be done according to the credit shall be free of any and
all retention or reduction of the taxes, exchange commissions, charges, expenses
or any concept, current or future, that implies one reduction in the amount that
the Bank must receive according to such credit. In consequence, the debtor shall
pay to whom corresponds all the obligations before third parties that affect or
implies, currently or in the future, in the amounts owed to the Bank according
to the current credit contract. In the eventual case that for disposition of law
is prohibited to the debtor to make payments owed to the Bank without making
deductions or retentions or payment of any other amount or reimburse to the Bank
the amounts paid for such concept, the payments for interest owed upon the date
of payment in the necessary amount in order to, once complied the obligations
for those concepts indicated, the Bank receives in integral manner the amounts
established in this credit contract. The debtor shall also provide the Bank, in
the term above

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indicated, authenticated copy of the proofs of having negotiated the currencies
derived of this loan by means of the national banking system or authorized
entities by the Monetary Board of Guatemala to operate the change of currency.
In the event that the debtor does not complies with any of the payments
mentioned and as consequence the Bank is bound to make the same, the first shall
reimburse the Bank within three (3) following working days after notice that the
Bank has made one, several or all those payments, the amounts for such concepts
have paid, plus interests under a rate equal to the one agreed for the total of
the credit, and in such case, the expenses and commissions caused. THIRD: OF THE
PROPERTIES OF THE GOODS THAT BE GIVEN IN PLEDGE: Mr. MICHAEL EDWARD ASCOLI
GIRON, in representation of the entity PRICESMART (GUATEMALA), SOCIEDAD ANONIMA,
declares under faith of oath and advised by the Notary Undersigning of the
penalties related to the fault for perjury, that its represented, PRICESMART
(GUATEMALA): a) PRICESMART PLAZA, located in sixth avenue zero dash seventy nine
of the zone four, city of Guatemala (6th Avenue 0-79, zone 4) registered under
number two hundred thirty five thousand four hundred ninety four (235,494),
folio two hundred thirty six (236) book one hundred ninety seven (197) of
Mercantile Business, file number eighteen thousand one hundred ninety tree dash
two thousand (18,193-2000); and b) PRICESMART (GUATEMALA), SOCIEDAD ANONIMA,
located in twenty first avenue seven dash ninety of zone eleven, city of
Guatemala (21 Avenue 7-90, zone 11) registered under number one hundred ninety
thousand two hundred twenty seven A (190,227 A), folio ninety (90), book one
hundred fifty five (155) of Mercantile Business, file number twenty eight
thousand nine hundred thirty four dash nineteen hundred ninety eight
(28,934-1998). States Mr. MICHAEL EDWARD ASCOLI GIRON, in capacity in which
acts: a) That accredits the property of Mercantile Business property of
PRICESMART (GUATEMALA), SOCIEDAD ANONIMA, through the presentation to the Notary
Undersigned of the documents consisting in Certifications issued by the General
Mercantile Registration of the Republic of dates twenty ninth of November and
fifth of December of the current year, referring to Mercantile Business
described and identified in clauses "a" and "b" of this clause, in which it is
established that the owner of the same is PRICESMART (GUATEMALA), SOCIEDAD
ANONIMA; b) That all taxes of any type currently existing and are in effect,
that the charges and taxes against all and each of the Mercantile Business
required by any governmental authority of the Republic of

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Guatemala or any political or fiscal authority, have been complete and finally
paid or provisioned, specially in the Tax to Mercantile and Agropecuary
Business; c) That Mercantile Business of its represented, PRICESMART
(GUATEMALA), SOCIEDAD ANONIMA, are free and over them there are no encumbrances,
notes, leases, impediments, embargoes, charges, rights against, pledges, use or
usufruct or limitations that may affect rights of third parties, except the
pledge constituted over variable inventory not perishable consisting in
merchandise, that guarantees the hundred twenty five percent of the margin of
the loan with Banco Uno, for the amount of two million of dollars of the United
States of America. Adds Mr MICHAEL EDWARD ASCOLI GIRON that the statements made
correspond to the goods encumbered. The Notary advises the civil and penal
responsibilities incurred in the event that the above statements are not true.
FOURTH: CONSTITUTION OF PLEDGE OF MERCANTILE BUSINESS. A) Mr MICHAEL EDWARD
ASCOLI GIRON, expresses that its represented, PRICESMART (GUATEMALA), SOCIEDAD
ANONIMA, constitutes in favor of CITIBANK, N. A., in guarantee of the payment of
the totality of the obligations herein contracted by the entity PRICESMART
(GUATEMALA), SOCIEDAD ANONIMA, including capital, interests, fees, collection
expenses and any other obligations demandable by virtue of law and this contract
FIRST, SOLE AND SPECIAL PLEDGE over the Mercantile Business property of its
represented, described and identified in paragraphs "a" and "b" of the third
clause immediately previous to this instrument, as well as over all results and
performances produced by such Mercantile Business. In addition, declares in name
of its represented, that in the pledge are included all elements of the
Mercantile Business, inventories, all assets and all accounts payable ordinary
and extraordinary of PRICESMART (GUATEMALA), SOCIEDAD ANONIMA, (particularly
accounts receivables derived of credit titles) that in fact and right
corresponds to PRICESMART (GUATEMALA), SOCIEDAD ANONIMA, as well as the
mentioned Mercantile Business; adds that, according to article six hundred fifty
five (655) of the Code of Commerce, it is understood as Mercantile Business the
set of work, of material elements and coordinated incorporating values, to offer
the public with lucrative purpose or in systematic manner, goods or services.
Likewise, the pledge of Mercantile Business include all the elements that
establishes article six hundred fifty seven (657) of the Code of Commerce..
Continues stating MICHAEL EDWARD ASCOLI GIRON, in his capacity, that its
represented, PRICESMART (GUATEMALA), SOCIEDAD

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ANONIMA, has expressly contracted with Citibank, N. A. that the pledge of
Mercantile Business, also includes copyrights, manufacturing secrets and the
business, exclusive and concessions, as well as all registration maintained in
regard to the GOODS PLEDGED, including any and all diaries, books, operations
registry, sales and maintenance and other information related to these, as well
as all rights, titles and interests of PRICESMART (GUATEMALA), SOCIEDAD ANONIMA,
with goods pledges, all the authorizations, permits, ordinances, consents,
privileges, immunities, licenses, and rights of all type, description and
characters, options, registration, inspection, documents currently are or in the
future may be property or controlled by PRICESMART (GUATEMALA), SOCIEDAD
ANONIMA, for the use in connection to the effect, use, operation and maintenance
of the GOODS PLEDGED and all other previously indicated. It is understood
between the parties of this contract that the debtor shall not have limitation
or prohibition for the purchase and sale of products as well as for all the
operations that are of the ordinary draft of the Mercantile Business; b)
Outstanding Balance. The parties convene that MICHAEL EDWARD ASCOLI GIRON in
representation of GRUPO SOLID, S.A (constituted with initials), and Pricesmart
(Guatemala), Sociedad Anonima, shall respond all the goods current and future
for any outstanding balance that may be left in pledge, in a joint and solidary
manner; c) Deposit. All contacting parties appoint PRICESMART (GUATEMALA),
SOCIEDAD ANONIMA, as depositary of the goods pledged, which through its legal
representative, Michael Edward Ascoli Giron, expresses that is aware of the
obligations pertaining to such position, and who accepts to take for free. The
depositary declares that is in effective and total possession of the Mercantile
Business encumbered. Likewise, declares that is bound to allow that the persons
or entities appointed by the Bank may anytime inspect the status of the same and
if found suffering damages or deterioration or are not receiving the pertaining
attention and maintenance or are found in stage of abandonment, all upon the
judgment of the Bank, the same may address to a Judge to request the immediate
substitution in the charge of depositary, request tat shall be solved simply,
without article, previous and sole audience to the interested party. In the
event of execution, the depositary shall be removed by the judge through simple
request in such sense by the Bank. In this case, it shall be named as depositary
to the person proposed. The depositary assigned upon request of the Bank, shall
be exempted from the payment of any bond or guarantee for the performance of the
position. D) The debtor is

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bound to respond for the remedy for the eviction and other hidden causes of
the goods affected by the pledge. E) Insurance. The Debtor is bound to contract
and keep in effect during the period of the contract and all its extensions, and
in all case until the effective payment of capital, interests, commissions,
recharges, expenses and any other amount duly agreement of this contract, an
insurance with any of the authorized insurers to operate in the country - that
previously has been accepted expressly by the Bank - for the amounts and against
the risks that may affect the good or properties pledged tat are accustomed,
including accidents, force majeure and malicious prejudice, extremes that, in
case of discrepancies between the parties, shall be determined by the Bank. The
insurance shall be contracted in favor of the Bank as beneficiary of the
insurance and shall cover, as minimum the total amount of the credit and
interests or the balance outstanding from time to time. The Debtor shall provide
to the Bank authenticated copy of the insurance policy with all endorsements and
documents attached in which the deductible amount is stated and all other
conditions of the insurance. In addition, the same shall sent authenticated copy
of the receipt of payment of the premium and if this has been paid in
installments, it is bound to send the Bank a copy of the receipts within the
five (5) working days following the date of payment set in the policy. It is
also bound to send to the Bank an authenticated proof subscribed by the legal
representative of the insurer in the same that in the event of accident, the
indemnization shall be paid directly to the Bank, once deducted the payments for
taxes, commissions and any other concept that is legally bound to pay the
insurer before paying the indemnization. The Debtor shall provide the Bank the
above documents within the three following working days upon signing this
contract and, if may correspond to make a renewal or extension or any amendment
and/or endorsement of the insurance during the period of the contract, the
delivery shall be within fifteen (15) working days following the renewal,
extension, amendment and/or endorsement. If upon judgment of the Bank the
estimate of the remaining of the eventual indemnization were not enough to cover
the commercial value of the goods insured in the event of accident, for any
reason, the debtor shall contract according to the instructions of the Bank an
additional insurance for the difference or shall guarantee the same constituting
bond or any guarantee upon satisfaction of the Bank. In any case, if the Bank
considers for any reason or circumstance tat the insurance if not enough, or in
the event that the Debtor does not contract and/or maintains in effect the
insurance in the indicated manner, the Bank shall have the right,

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even though not the obligation, of requesting and contracting the insurance to
the account of the Debtor, who through this act authorizes such request and
contracting. F) By virtue of the grantors hereby request to Mr General
Mercantile Registrator of the Republic, to register and note in favor of
CITIBANK, N. A., the pledge of Mercantile Business, according to the testimony
of this document, in the registration inscriptions pertaining to PRICESMART
(GUATEMALA), SOCIEDAD ANONIMA, and made certification in the respective
testimony the pledges that through this act are constituted, as well as these
occupy the first place. g) On his side, Mr. Juan Antonio Miro Llort, on behalf
and representation of CITIBANK, N. A., accepts the pledges that through this act
are constituted in his favor. FIFTH: OTHER STIPULATIONS. a) It is convened that
the effect of the credit and until the cancellation of the amounts owed to the
Bank, the owner of the goods may not, without the previous and written
authorization of the same, encumber, lease, pledge, constitute usufruct, assign
any title or pledge again the Mercantile Business already given as guarantee,
under sanction of nullity of the acts or contracts that are held and without
prejudice of the right of the Bank to consider as terminated in advance the
period of the credit. B) It is expressly convened that the pledge constituted by
this act shall remain in effect and will have all the effects until the
effective cancellation of the totality of the credit and its extensions. C)
Maintenance of the Pledge. The Debtor is bound to keep the Mercantile Business
pledged in perfect state of operation, preservation, and maintenance imposing
equal obligations of its employees and dependants. The Debtor shall communicate
to the Bank, immediately, that is, the date in which occurs the first following
working day in case of holiday, the existence of any risk of any of the GOODS
PLEDGED. SIXTH: STATEMENTS AND OBLIGATIONS. Without prejudice to other
statements and obligations contracted according to this credit contract, the
legal representative of the debtor declares and assures through this act: a)
That its represented is a mercantile society duly organized, existing and in
good state of solvency according to the laws of the Republic of Panama and that
is bound to keep and maintain in during the effect of the of the credit its
legal existence and judicial personality, as well as all rights, including
privileges, commercial names, and to conduct its business in an organized,
efficient and regular manner; b) tat such entity has capacity to be owner of the
properties and to carry out businesses in the manner currently kept; c) that the
execution and compliance of this contract does not contravene any legal or
contracting precept that constitutes an event of

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non-compliance according to other contract or instrument in which its
represented is part of, or by obligation that may be contracted, or that is
prohibited for another reason; d) That the financial statements of its
represented for the fiscal year ended on the thirtieth of June of the year two
thousand were prepared according to the principles of accounting generally
accepted and applied upon a consistent basis for the specific period, and
present reasonably the financial situation of the debtor to the date of this
contract; e) Without prejudice of the above, the Debtor is bound to provide the
Bank the financial statements in any period in which this may request so. In any
case, it is bound to provide the Bank within the one hundred twenty (120)
calendar days following the fiscal closing of each of the years during which the
period of the credit or its extensions and until the total cancellation of the
credit, the financial statements for the pertaining year, including the balance
sheet, loss and profit statements, statements of change of capital of the
shareholders and statement of change in the financial situation of the Debtor.
The financial statements referred pertaining to each fiscal year shall be
presented audited by an auditing firm and independent public accountants whose
name is known and acceptable to the Bank, and shall be prepared according to the
principles of accounting generally accepted and calculated upon a consistent
basis for the specified periods and shall be presented reasonably the financial
situation of the Debtor to the date of the same. If the Debtor may be required
by the Bank, the same shall provide or place at the disposition of the Bank,
upon choice of this latter, the books of the acts, accounting books and the
documentation support, providing all the necessary cooperation with the experts
appointed by the Bank for the duly understanding of the same. Of this account,
such technicians shall interview with the persons and officers of the Debtor to
provide explanations on the financial situation; f) The registered address of
the debtor is twenty first avenue seven dash ninety of zone eleven, city of
Guatemala, and this address belongs exactly to the location where the main
offices and place of activities are found; g) That the contract contained in
this document legally binds the Debtor according to each of the clauses
demanding its compliance; h) States the legal representative of the Debtor that
since the date of the financial statements and patrimony state presented to the
Bank upon request of the credit herein mentioned until this date, there have
been no material adverse changes in the assets, obligations (contingent or
others) or in the financial situation or business of the Debtor. The same is
bound to provide the Bank, within the following three (3) working days to the
date in which is known a substantial adverse

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change in its financial situation, a detailed and precise report that contains,
at least, the nature of the change, the obligation or obligations affecting the
situation or situations in moratorium in which it may incurred, the time in
which has been in moratorium, the proposed measures to remedy such situation and
other information related to the adverse financial situation; I) The debtor is
bound to pay on a timely basis, all taxes, rates, arbitrations, contributions or
any other charges to which the same is bound, unless those in good faith may
have decided to refute, circumstance that will communicate to the Bank
immediately, or at least one day prior to the expiration of the period to
present the refusal. When related to taxes over the pledged properties, and/or
the credit contract, and with the purpose to prove that the same have been duly
paid, the debtor is bound to deliver the Bank within the following fifteen
working days of making the payment, the authenticated copy of the receipts
accrediting the compliance of such obligations. In the event that the debtor
does not comply with the payment mentioned in this literal, the same authorizes
upon this moment the Bank to make such payment on its behalf, provided that the
Bank may choose to do so. In this case, it shall reimburse the Bank within the
next three working days after been advised that the Bank as made such payment,
the quantities that for such concept this latter has paid, plus interests
equivalent to an equal rate agreed for the amount of the credit, and in its
case, the expenses and commissions caused; j) the goods pledged shall be
inspected periodically by the person or persons appointed by the Ban, and in any
case no less than twice (2) a year. The owner shall allow such persons to access
the place and shall provide the cooperation and assistance that may be required
for the effects of the inspection; k) The debtor shall keep in effect the
contracts and/or work relations or services with the current management team,
being able to substitute only with personnel of equal capacity or better
qualified than the current; I) That there is no litigation or administrative
procedure pending before the court or authority or arbitrators that may affect
in negative or adverse manner the financial situation of the Debtor or the
legitimacy, validity or demandability of this contract. The debtor shall inform
the Bank in an immediate manner any litigious matter that may be part of, and
the following day be notified of all action and/or judicial diligence placed
against it. In regards precautious measures, the same shall inform the Bank
immediately upon having knowledge of the same. It shall also inform the Bank of
any obligation that the same may have; m) The Debtor shall not contact
encumbrance, pledge or any other obligations, of any nature that may lead to
encumbrances or limitations over the

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current properties or those that may acquire in the future, without the previous
and written consent of the Bank; n) The Debtor shall comply all the regulations,
rules, laws, orders and in general, all the standards of any nature issued by
the competent authority that may be applicable; o) the Debtor shall provide
notice in writing to the Bank, no later than the following day of the
occurrence, any non-compliance accompanied by a statement of the action proposed
by the Debtor to remedy the unfulfillment; p) The Debtor shall not sell, lease
or in any manner dispose of a substantial portion of the assets in any fiscal
exercise except with the previous and written consent of the Bank; and q) Upon
concluding the fiscal period of the year two thousand one, THE DEBTOR may keep
and reflect the next financial situation; i) That by reason of coverage of
service of debt be in any moment less than one point five (1.5) to one (1.00).
For the purpose of calculation of "Reason of Coverage of Debt Service" shall be
calculated annually upon the last day of each fiscal year of the Debtor for the
period of one year concluding in the date of determination of the same and shall
be defined, as the guarantees of the Debtor prior to the interests, taxes,
depreciation and amortization (EBITDA), over the amount of payment of interests,
capital, and the current portion of the long term debt (those payments of debts
to be made during the period following such for which the determination was
carried out, all determined according to the principles of accounting generally
accepted and applied in such consistent manner; ii) That for Debt or Leverage be
in any moment no more than three point eight (3.80) to one (1.00). For the
purpose of the calculation, it shall be defined the "Reason of Debt", as the
total of liabilities of the Debtor (including the obligations owed to the
headquarters, PriceSmart, Inc. and any other company related to the
headquarter), over the profits of the Debtor before the interests, taxes,
depreciation and amortization (EBITDA), all as determined according to the
principles of accounting generally accepted and applied in consistent manner;
and iii) That the maximum level of the total outstanding balance of the Debtor,
over the profits of the Debtor before the interests, taxes, depreciation and
amortization (EBITDA), may not be in any moment higher than two point five (2.5)
to one (1.00). For the purpose of the calculation, it shall define "Total of the
Debt" as debt with the banks, debts to banks, short and long term debts, plus
any other amount owed to PriceSmart, Inc, and any other company related to the
headquarters. SEVENTH: NON COMPLIANCE AND PREMATURE TERMINATION: The Bank shall,
upon discretion, consider terminated the period of the contract in a premature

<PAGE>

manner and demand the payment of the capital, interests, expenses, and in its
case, judicial fees as any other obligation or payment owed according to this
contract, in the event of occurring any of the following issues: a) If the
debtor does not comply with the payment of interests or capital, expenses or
commissions to the Bank when are owed or payable, be it upon expiration or in
any date established for its payment; b) For lack of compliance of the debtor to
any of the obligations assumed in this credit contract, or those that according
to the law corresponds to assume; c) For lack of compliance of the debtor
PRICESMART (GUATEMALA), SOCIEDAD ANONIMA, to cancel in its totality, the banking
credit granted by Banco Uno, Sociedad Anonima, for the amount of up to two
million dollars of the United States of America, on the date of the expiration,
March nineteen of the year two thousand one; d) When occurring a material
adverse change in the financial condition or in the business of the debtor, that
to the opinion of the Bank, affects the guarantee or increase the risk; e) When
occurring a material change in the political, economic, monetary situation or of
the other type in the Republic of Guatemala that in the opinion of the Bank,
could increase the risk; f) If the debtor is object of demand, embargo, kidnap
or intervention, or if declared in bankruptcy or if promoting voluntary bid of
creditors or if is created against it a forced bid of creditors or bankruptcy;
g) If any of the goods of the debtor, but specially the pledge movables, suffer
such depreciation or reduction that does no longer constitute enough support to
the Bank, unless the same offers and effectively constitutes a guarantee
satisfactory to the Bank; h) If the debtor reduces its capital, amortizes or
acquires its own shares, begins dissolution, liquidation, merges by absorption
or consolidation in or with other person without previous consent and approval
of the Bank; i) If the meeting of shareholders of the debtor agrees to
distribute dividends in each fiscal period, be that these provide from current,
retained and/or accumulated utilities for an amount superior to the amount
equivalent to the sixty percent (60%) of the positive annual net income; j) If
the debtor encumbers a substantial part of the goods to any other title without
previous authorization of the Bank; k) If the debtor does not comply with the
payment of any other debt including capital, interests, premiums or commissions
or does not comply in any other manner its obligations in its charge and in
favor of the Bank, be it upon expiration of the natural period or in case of
anticipated expiration; l) If the Debtor does not comply with the payment of any
other debt contracted with third parties while become demandable, if stops in
the payment of its obligations or if it makes an

<PAGE>

general assignment in favor of its creditors; mm) If any sentence or order is
dictated against the Debtor demanding the payment or more than the amount of ONE
MILLION DOLLARS OF THE UNITED STATES OF AMERICA ($1,000,000.00), or its
equivalent in other currency; n) If any governmental, judicial, or other
authority of the Republic of Guatemala initiates actions to expropriate, kidnap,
take over all or substantial part of the goods of the debtor or in other manner
assumes the custody or control of the properties be it by execution or in any
other manner and/or restricts, limits or prohibits the Debtor the handling and
faculty to control its business; and o) If the debtor merges with other company
or if in any other manner transfers the companies through which performs its
activities and carries out businesses. EIGHTH: AUTHORIZATION TO DEBIT. If the
credit against the Debtor is demandable by virtue of any case expected as
non-compliance for this contract or by law, the Bank may retain the goods of the
Debtor found in their power or at their disposition. Likewise, if the mentioned
non-compliance occurs, the Debtor authorizes in an irrevocable manner to the
Bank to debit any account of deposits that the same maintains with the Bank to
the effect of extinguishing any debt to its charge, and until the maximum amount
necessary to extinguish the amounts owed. NINT: ASSIGNMENT. The debtor accepts
and recognizes expressly that the Bank may assign, encumber, or negotiate in any
manner its rights derived from the credit and over the pledge guarantees,
without need of previous or further notice or consent of the Debtor, by only
notifying the name of the new creditor and the place in which such payment shall
be made for both capital and interests. The Debtor shall not assign or transfer
the rights and obligations that corresponds to the same according to this
contract, direct or indirectly without the previous consent of the Bank. TENTH:
RESIGNATION. No lack or delay of the Bank in the exercise of any right or
faculty corresponding to the same according to this contract, shall produce
effects of a resignation of these. It shall neither impede for the same reason
any other right or future exercise of such rights or of a faculty, action,
pretension, exception or resource. Likewise, shall effect shall not happen for
the partial exercise of the same. The rights, actions, pretensions, exceptions
and resources established in this contract do not exclude any other established
by law. ELEVENTH: HONORARY AND EXPENSES. The honoraries and expenses that cause
with reason the present business and the registration of the pledge in the
General Mercantile Registration of the Republic as well as the judicial and
extrajudicial related with its collection, shall be to the account of the
debtor. TWELFTH:

<PAGE>

APPLICABLE LAW. This contract shall be ruled, governed, and interpreted
according to the laws of the Republic of Guatemala. THIRTEENTH: PROCESSING
EFFECTS. The Debtor recognizes as perfect executive title the testimony of this
document, waiver of domicile and submits expressly to the competence of the
courts of the Department of Guatemala, Republic of Guatemala, the one chosen by
the Bank. Likewise, the Debtor accepts as liquid, demandable and of expired term
the amount that the Bank demands and as good and precise the accounts that the
Bank presents, in regards to the credit. b) The debtor exempts the Bank of the
obligation to provide bond, guarantee or counterguarantee for the exercise of
its rights or derived of a precautious measure. c) For the effects of this
contract, the Debtor establishes and designates as place to receive notices,
summons, communications and correspondence the address indicated in clause six
of this document, and is bound to advise in writing to the Bank any change that
may result in the understanding the if not doing so, shall be considered valid
and well done the communications, summons and notices sent, practiced or
destined to such address. FOURTEENTH: SUBSTITUTION OF OTHER CONVENTIONS. This
contract and any other documents subscribed as result or in compliance of the
same, express the complete understanding of the parties regarding the judicial
business executed between the parties in this document. Any extension,
amendment, innovation, resignation of right and termination shall be made with
the written authorization and approval of the Bank. FIFTEENTH: SEVERABILITY. If
any convention of credit or of this contract or the application of the same to
any person, by any circumstance is considered invalid, void, inefficient or for
any reason avoids legal effects, such invalidity, nullity, inefficiency or
impediment shall not affect any other contract that may have effects without the
affected agreement. For such purpose, the agreements, conventions, rights and
obligations contained in this contract of credit shall be severable. SIXTEENTH:
SENTECE OR AUTO: If with the purpose of obtaining a sentence or final act is
necessary to convert the amounts owed in Dollars of the United States of America
to another currency according to this contract, the parties convene that the
type of exchange to be used shall be such which allows the Bank acquire all the
proper currencies in accordance to the normal banking procedures the previous
working day to such in which is dictated the final sentence, or related to the
execution under judicial order, the previous working day to which is dictated in
the auto solving definitely the liquidation project of the debt and the
processing fees. Without prejudice that a sentence is

<PAGE>

dictated or not in Dollars of the United States of America, the obligation of
the Debtor in regards to the any amount owed to the Bank according to this
contract shall be considered paid only if on the following working day to the
date in which Bank has received this other currency, any amount taken by the
court as owed under this contract, the Bank may agree with the normal banking
procedures, purchase dollars of the United States of America with such other
currency which satisfy total or partially the balance outstanding. If the debt
is covered only partially by virtue that the Dollars of the United States of
America so compared result in a less amount than the total originally owed to
the Bank according to this contract, the Debtor agrees, as an obligation
different and independently of such sentence or auto, indemnize the Bank for the
difference resulting from the Dollars acquired and the amount effectively owed
according to this contract. SEVENTEENTH: ACCEPTANCE. The grantors, in capacity
with those acting, state the acceptance of the clauses and stipulations of this
document. I, the Notary, ATTEST: a) of total exposed; b) that I have seen the
related documentation, and the certifications issued by the General Mercantile
Registration of the Republic, in which are stated the movable goods pledge
belonging to the Debtor; and c) that I have read what is written by the
grantors, who after having personally be aware of its contents, objective,
validity, legal effects and obligations, do confirm, accept and sign jointly
with the Notary Undersigned.

[Two illegible signatures]

Before me:

[Signature of the Notary]<PAGE>

                                                                    EXHIBIT 10.6

================================================================================

                                                         INVESTMENT NUMBER 10296

                                 LOAN AGREEMENT

                                      AMONG

                                PRICESMART INC.,

                                PSMT CARIBE INC.,

                          PSMT TRINIDAD/TOBAGO LIMITED,

                                       AND

                        INTERNATIONAL FINANCE CORPORATION

                          DATED AS OF JANUARY 26, 2001

===============================================================================

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
ARTICLE OR
 SECTION                            ITEM                                PAGE NO.
<S>                                                                     <C>
ARTICLE I......................................................................1

DEFINITIONS AND INTERPRETATION.................................................1
   Section 1.01.  General Definitions..........................................1
   Section 1.02.  Financial Definitions.......................................10
   Section 1.03.  Financial Calculations......................................15
   Section 1.04.  Interpretation..............................................15
   Section 1.05.  Business Day Adjustment.....................................16

ARTICLE II....................................................................16

THE PROJECT, PROJECT COST AND FINANCIAL PLAN..................................16
   Section 2.01.  The Project.................................................16
   Section 2.02.  Project Cost and Financial Plan.............................16

ARTICLE III...................................................................17

THE A LOAN....................................................................17
   Section 3.01.  A Loan......................................................17
   Section 3.02.  Disbursement Procedure......................................17
   Section 3.03.  Interest....................................................18
   Section 3.04.  Default Rate Interest.......................................19
   Section 3.05.  Repayment...................................................20
   Section 3.06.  Prepayment..................................................20
   Section 3.07.  Fees........................................................21
   Section 3.09.  Currency and Place of Payments..............................22
   Section 3.09.  Allocation of Partial Payments..............................22
   Section 3.10.  Increased Costs.............................................22
   Section 3.11.  Unwinding Costs.............................................22
   Section 3.12.  Suspension or Cancellation by IFC...........................23
   Section 3.13.  Cancellation by Co-Borrowers................................23
   Section 3.14.  Taxes.......................................................24
   Section 3.15.  Expenses....................................................24

ARTICLE IV....................................................................26

REPRESENTATIONS AND WARRANTIES................................................26
   Section 4.01.  Representations and Warranties..............................26
   Section 4.02.  IFC Reliance................................................28
</TABLE>

<PAGE>

                                      -ii-

<TABLE>
<CAPTION>
ARTICLE OR
 SECTION                            ITEM                                PAGE NO.
<S>                                                                     <C>
ARTICLE V.....................................................................29

CONDITIONS OF DISBURSEMENT....................................................29
   Section 5.01.  Conditions of First Disbursement............................29
   Section 5.02.  Conditions of All Disbursements.............................31
   Section 5.03.  Co-Borrowers' Certifications................................32
   Section 5.04.  Conditions for IFC Benefit..................................33

ARTICLE VI....................................................................33

PARTICULAR COVENANTS..........................................................33
   Section 6.01.  Affirmative Covenants.......................................33
   Section 6.02.  Negative Covenants..........................................35
   Section 6.03.  Reporting Requirements......................................41
   Section 6.04.  Insurance...................................................44

ARTICLE VII...................................................................46

EVENTS OF DEFAULT.............................................................46
   Section 7.01.  Acceleration after Default..................................46
   Section 7.02.  Events of Default...........................................46
   Section 7.03.  Bankruptcy..................................................49

ARTICLE VIII..................................................................49

MISCELLANEOUS.................................................................49
   Section 8.01.  Saving of Rights............................................49
   Section 8.02.  Notices.....................................................50
   Section 8.03.  English Language............................................51
   Section 8.04.  Term of Agreement...........................................51
   Section 8.05.  Applicable Law and Jurisdiction.............................51
   Section 8.06.  Disclosure of Information...................................53
   Section 8.07.  Successors and Assignees....................................54
   Section 8.08.  Joint and Several Liability.................................54
                                   -
   Section 8.09.  Amendments, Waivers and Consents............................54
   Section 8.10.  Counterparts................................................54
</TABLE>

<PAGE>

                                     -iii-

<TABLE>
<CAPTION>
ARTICLE OR
 SECTION                            ITEM                                PAGE NO.
<S>                                                                     <C>
ANNEX A.......................................................................57

BORROWER/PROJECT AUTHORIZATIONS...............................................57

ANNEX B.......................................................................59

INSURANCE REQUIREMENTS........................................................59

ANNEX C.......................................................................60

ASSETS OF THE CO-BORROWERS
TO BE GRANTED AS SECURITY.....................................................60

ANNEX D.......................................................................62

LIST OF LIENS.................................................................62

SCHEDULE 1....................................................................64

FORM OF CERTIFICATE OF INCUMBENCY AND AUTHORITY...............................64

SCHEDULE 2....................................................................66

FORM OF REQUEST FOR DISBURSEMENT (A LOAN).....................................66

SCHEDULE 3....................................................................70

FORM OF LOAN DISBURSEMENT RECEIPT.............................................70

SCHEDULE 4....................................................................71

FORM OF SERVICE OF PROCESS LETTER.............................................71

SCHEDULE 5(A).................................................................73

FORM OF LOCAL COUNSEL'S LEGAL OPINION.........................................73

SCHEDULE 5(B-1)...............................................................79

FORM OF LOCAL COUNSEL'S LEGAL OPINION.........................................79

SCHEDULE 5(B-2)...............................................................85

FORM OF LOCAL COUNSEL'S LEGAL OPINION.........................................85
</TABLE>

<PAGE>

                                      -iv-

<TABLE>
<CAPTION>
ARTICLE OR
 SECTION                            ITEM                                PAGE NO.
<S>                                                                     <C>
SCHEDULE 5(B-3)...............................................................91

FORM OF LOCAL COUNSEL'S LEGAL OPINION.........................................91

SCHEDULE 5(C).................................................................94

FORM OF SPECIAL COUNSEL'S LEGAL OPINION.......................................94

SCHEDULE 5(B).................................................................99

FORM OF PRICESMART SPECIAL COUNSEL'S LEGAL OPINION............................99

SCHEDULE 6...................................................................104

FORM OF LETTER TO BORROWER'S AUDITORS........................................104

SCHEDULE 7...................................................................106

FORM OF CO-BORROWER'S
CERTIFICATION ON DISTRIBUTION OF DIVIDENDS...................................106

SCHEDULE 8...................................................................108

FORM OF PROGRESS REPORT RE:
PROJECT IMPLEMENTATION.......................................................108

SCHEDULE 9...................................................................109

INFORMATION TO BE INCLUDED IN
ANNUAL REVIEW OF OPERATIONS..................................................109

SCHEDULE 10..................................................................110

FORM OF ANNUAL MONITORING REPORT.............................................110
</TABLE>

<PAGE>

                                 LOAN AGREEMENT

        AGREEMENT, dated as of January 26, 2001, among:

         (1)    PRICESMART INC., a corporation organized and existing under the
                laws of the State of Delaware, U.S.A. ("PriceSmart");

         (2)    PSMT CARIBE, INC., a company organized and existing under the
                laws of the Territory of the British Virgin Islands ("Caribe");

         (3)    PSMT TRINIDAD/TOBAGO LIMITED, a company organized and existing
                under the laws of the Republic of Trinidad and Tobago ("PSMT
                Trinidad" and PriceSmart, Caribe and PSMT Trinidad are
                collectively referred to herein as the "Co-Borrowers"); and

         (4)    INTERNATIONAL FINANCE CORPORATION, an international organization
                established by Articles of Agreement among its member countries
                ("IFC").

                                    ARTICLE I

                         DEFINITIONS AND INTERPRETATION

         Section 1.01. GENERAL DEFINITIONS. Wherever used in this Agreement, the
following terms have the meanings opposite them:

"A Loan"                     the A Loan specified in Section 3.01 (THE A LOAN)
                             or, as the context requires, its principal amount
                             from time to time outstanding;

"Accounting Principles"      United States Generally Accepted Accounting
                             Principles ("US-GAAP") promulgated by the
                             Financial and Accounting Standards Board, together
                             with its pronouncements thereon from time to time,
                             and applied on a consistent basis;

"Affiliate"                  any Person directly or indirectly controlling,
                             controlled by or under common control with, any
                             Co-Borrower (for purposes of this definition,
                             "control" means the power to direct the management
                             or policies of a Person, directly or indirectly,
                             whether through the ownership of shares or other
                             securities, by contract or otherwise, provided
                             that the direct or indirect ownership of fifteen
                             per cent

<PAGE>

                                      -2-

                             (15%) or more of the voting share capital of a
                             Person is deemed to constitute control of that
                             Person, and "controlling" and "controlled" have
                             corresponding meanings);

"Assignment of
 Insurance Proceeds"         the agreement entitled Assignment Agreement of even
                             date herewith, among the Co-Borrowers and IFC,
                             whereby each of the Co-Borrowers assigns to IFC
                             all of its right, title and interest in and to all
                             insurance proceeds under insurance policies
                             insuring the IFC Security;

"Auditors"                   the firm that the Co-Borrowers appoint from time
                             to time as its auditors pursuant to Section
                             6.01(d) (AFFIRMATIVE COVENANTS);

"Authority"                  any national, supranational, regional or local
                             government or governmental, administrative,
                             fiscal, judicial, or government-owned body,
                             department, commission, authority, tribunal,
                             agency or entity, or central bank (or any Person,
                             whether or not government owned and howsoever
                             constituted or called, that exercises the
                             functions of a central bank);

"Authorization"              any consent, registration, filing, agreement,
                             notarization, certificate, license, approval,
                             permit, authority or exemption from, by or with any
                             Authority, whether given by express action or
                             deemed given by failure to act within any specified
                             time period and all corporate, creditors' and
                             shareholders' approvals or consents;

"Authorized Representative"  any natural person who is duly authorized by each
                             of the Co-Borrowers to act on each such
                             Co-Borrower's behalf for the purposes specified
                             in, and whose name and a specimen of whose
                             signature appear on, the Certificate of Incumbency
                             and Authority most recently delivered by the
                             Co-Borrowers to IFC;

"Business Day"               a day when banks are open for business in New York,
                             New York or, solely for the purpose of determining
                             the Interest Rate other than pursuant to Section
                             3.03(d)(ii) (INTEREST), London, England ;

"C Loan"                     the C Loan, made by IFC to the Co-Borrowers
                             pursuant to the C Loan Agreement, in the principal
                             amount of ten million Dollars ($10,000,000);

"C Loan Agreement"           the agreement of even date herewith, among the
                             Co-Borrowers and IFC, setting for the terms and
                             conditions of the C Loan;

"C Loan Disbursement"        the full disbursement of the C Loan;

<PAGE>

                                      -3-

"Capital Lease Obligation"   of any Person as of the date of determination, the
                             obligations of such Person to pay rent and other
                             amounts under any lease of (or other arrangement
                             conveying the right to use) real or personal
                             property, or a combination thereof, which
                             obligations are required to be classified and
                             accounted for as capital leases on a balance sheet
                             of such person under Accounting Principles;

"Certificate of Incumbency
 and Authority"              the certificate provided to IFC by each of the
                             Co-Borrowers in the form of Schedule 1;

"Charter"                    with respect to each Co-Borrower, its memorandum
                             and articles of association or other constitutive
                             document;

"Country"                    with respect to: PriceSmart, the United States of
                             America; with respect to Caribe, the British Virgin
                             Islands; with respect to PSMT Trinidad, Trinidad
                             and Tobago, or, as the context may require, all of
                             the Countries previously mentioned;

"Derivative Transaction"     any swap agreement, cap agreement, collar
                             agreement, futures contract, forward contract or
                             similar arrangement with respect to interest
                             rates, currencies or commoditY prices;

"Disbursement"               any disbursement of the A Loan;

"Dollars" and "$"            the lawful currency of the United States of
                             America;

"Environmental, Health
 and Safety Guidelines"      the IFC General Health and Safety Guidelines, dated
                             July 1998 and the World Bank General Environmental
                             Guidelines, dated July 1998, a copy of which has
                             been delivered to, and receipt of which has been
                             acknowledged by, the Co-Borrowers by letter dated
                             November 1, 2000 and is incorporated herein by
                             reference;

"Environmental
 and Social Policies"        the IFC Operational Policy on Environmental
                             Assessment (OP 4.01), dated October 1998 and the
                             IFC Policy Statement on Forced Labor and Harmful
                             Child Labor, dated March 1998, copies of which
                             have been delivered to, and receipt of which has
                             been acknowledged by, the Co-Borrowers by letter
                             dated November 1, 2000 and is incorporated herein
                             by reference;

"Escrow Account"             the Dollar-denominated bank account to be opened
                             pursuant to the Escrow Account Agreement;
<PAGE>

                                      -4-

"Escrow Account
 Agreement"                  the agreement entitled "Escrow Account Agreement"
                             to be entered into among the Co-Borrowers, The Bank
                             of New York and IFC;

"Event of Default"           any one of the events  specified  in Section 7.02
                             (EVENTS OF DEFAULT);

"Financial Plan"             the proposed sources of financing for the Project
                             set out in Section 2.02 (b) (PROJECT COST AND
                             FINANCIAL PLAN);

"Financial Year"             the accounting year of the Co-Borrowers commencing
                             each year on September 1 and ending on the
                             following August 31, or such other period as the
                             Co-Borrowers, with IFC's consent, from time to
                             time designate as their accounting year;

"IFC Security"               the security, with a book value (a) on the date of
                             the disbursement of the C Loan, of no less than
                             one and one-half times the amount of the C Loan
                             and (b) on the date of the first Disbursement, of
                             no less than one and one-half (1.5) times the
                             aggregate amount of the A Loan and the C Loan,
                             created by or pursuant to the Security Documents
                             to secure all amounts owing by the Co-Borrowers to
                             IFC under this Agreement;

"Increased Costs"            the net incremental costs of, or reduction in
                             return to, IFC in connection with the making or
                             maintaining of the A Loan and the C Loan that
                             result from any change in any applicable law or
                             regulation or directive (whether or not having
                             force of law) or in its interpretation or
                             application by any Authority charged with its
                             administration that, after the date of this
                             Agreement, imposes on IFC any condition regarding
                             the making or maintaining of the A Loan and the C
                             Loan;

"Increased Costs
 Certificate"                a certificate provided from time to time by IFC
                             certifying the amount of, and circumstances giving
                             rise to, the Increased Costs;

"Interest Determination
 Date"                       except as otherwise provided in Section 3.03(d)(ii)
                             (INTEREST), the second Business Day before the
                             beginning of each Interest Period;

"Interest Payment Date"      March 15 or September 15 in any year;

"Interest Period"            each period of six (6) months, in each case
                             beginning on an Interest Payment Date and ending
                             on the day immediately before the next following
                             Interest Payment Date, except in the case of the
                             first

<PAGE>

                                      -5-

                             period applicable to each Disbursement when it
                             means the period beginning on the date on which
                             that Disbursement is made and ending on the day
                             immediately before the next following Interest
                             Payment Date;

"Interest Rate"              for any Interest Period, the rate at which interest
                             is payable on the A Loan during that Interest
                             Period, determined in accordance with Section 3.03
                             (INTEREST);

"Letter of Information"      the letter of information, dated October 20, 2000,
                             from the Co-Borrowers to IFC providing a detailed
                             description of the Co-Borrowers and their
                             respective Subsidiaries, the Project, the
                             Financial Plan and the organization, status,
                             operations and liabilities of the Co-Borrowers,
                             and containing representations and warranties of
                             all material facts concerning the Project, in form
                             and substance acceptable to IFC;

"LIBOR"                      the British Bankers' Association ("BBA") interbank
                             offered rates for deposits in the Dollars which
                             appear on the relevant page of the Telerate
                             Service (currently page 3750) or, if not
                             available, on the relevant pages of any other
                             service (such as Reuters Service or Bloomberg
                             Financial Markets Service) that displays such BBA
                             rates; provided that if BBA for any reason ceases
                             (whether permanently or temporarily) to publish
                             interbank offered rates for deposits in the
                             Dollars, "LIBOR" shall mean the rate determined
                             pursuant to Section 3.03(d) (INTEREST);

"Lien"                       any mortgage, pledge, charge, assignment,
                             hypothecation, security interest, title retention,
                             preferential right, trust arrangement, right of
                             set-off, counterclaim or banker's lien, privilege
                             or priority of any kind having the effect of
                             security, any designation of loss payees or
                             beneficiaries or any similar arrangement under or
                             with respect to any insurance policy or any
                             preference of one creditor over another arising by
                             operation of law;

"Life and Fire Safety
 Guidelines"                 IFC's Life and Fire Safety Guidelines, a copy of
                             which has been delivered to the Co-Borrowers by fax
                             letter dated January 22, 2001, and is incorporated
                             herein by reference;

"Loans"                      collectively the A Loan and the C Loan or, as the
                             context requires, the principal amount from time to
                             time outstanding under the A Loan and the C Loan;

<PAGE>

                                      -6-

"Material Adverse Effect"    a material adverse effect on:

                             (i)    the Co-Borrowers, their assets or properties
                                    taken as a whole;

                             (ii)   the Co-Borrowers' business prospects or
                                    financial condition taken as a whole;

                             (iii)  the implementation of the Project, the
                                    Financial Plan or the carrying on of the
                                    Co-Borrowers' business or operations taken
                                    as a whole; or

                             (iv)   the ability of the Co-Borrowers (taken as a
                                    whole) to comply with their obligations
                                    under this Agreement or any other
                                    Transaction Document;

"Official"                   any officer of a political party or candidate for
                             political office in the Country or any officer or
                             employee (i) of the Government (including any
                             legislative, judicial, executive or administrative
                             department, agency or instrumentality thereof) or
                             (ii) of a public international organization;

"OPIC"                       the Overseas Private Investment Corporation, a
                             corporation organized pursuant to the Foreign
                             Assistance Act of 1969 of the United States of
                             America;

"OPIC Loan"                  the loan, in the principal amount of ten million
                             Dollars ($10,000,000) to be made by OPIC to one or
                             more of the Co-Borrowers, evidenced by the OPIC
                             Loan Agreement or, as the context requires, its
                             principal amount from time to time outstanding;

"OPIC Loan Agreement"        the loan agreement to be entered into between one
                             or more of the Co-Borrowers and OPIC;

"Person"                     any natural person, corporation, company,
                             partnership, firm, voluntary association, joint
                             venture, trust, unincorporated organization,
                             Authority or any other entity whether acting in an
                             individual, fiduciary or other capacity;

"Potential Event of Default" any event or circumstance which would, with notice,
                             lapse of time, the making of a determination or any
                             combination thereof, become an Event of Default;

<PAGE>
                                      -7-

"PriceSmart
 El Salvador"                PriceSmart El Salvador, S.A. de C.V., a SOCIEDAD
                             ANONIMA organized and existing under the laws of El
                             Salvador;

"PriceSmart
 Guatemala"                  PriceSmart (Guatemala), S.A., a SOCIEDAD ANONIMA
                             organized and existing under the laws of Guatemala;

"PriceSmart
 Pledge Agreements"          the pledge agreements, each of even date herewith
                             and entered into between PriceSmart and IFC,
                             whereby PriceSmart pledges all of the shares it
                             owns in each of PSMT Caribe, PSMT Trinidad and
                             PSMT Barbados, respectively, as security for the
                             Loans;

"Prohibited Payments"        any offer, gift, payment, promise to pay or
                             authorization of the payment of any money or
                             anything of value, directly or indirectly, to or
                             for the use or benefit of any Official (including
                             to or for the use or benefit of any other Person
                             if any of the Co-Borrowers knows, or has
                             reasonable grounds for believing, that the other
                             Person would use such offer, gift, payment,
                             promise or authorization of payment for the
                             benefit of any such Official), for the purpose of
                             influencing any act or decision or omission of any
                             Official in order to obtain, retain or direct
                             business to, or to secure any improper benefit or
                             advantage for, any of the Co-Borrowers, any of
                             their Affiliates or any other Person; provided
                             that any such offer, gift, payment, promise or
                             authorization of payment shall not be considered a
                             Prohibited Payment if, in IFC's reasonable
                             opinion, it (i) is lawful under applicable written
                             laws and regulations or (ii) is made for the
                             purpose of expediting or securing the performance
                             of a routine governmental action (as such term is
                             construed under applicable law);

"Project"                    the project described in Section 2.01 (THE
                             PROJECT);

"Project Financial
 Completion Date"            the last day of the month in which the
                             following requirements have been fully satisfied:

                             (i)    in respect of the most recently completed
                                    four consecutive financial quarters after
                                    December 31, 2005, the Consolidated Total
                                    Debt to Equity Ratio is not in excess of
                                    50:50, the Consolidated Current Ratio is not
                                    less than 1.2 and the Consolidated Long-term
                                    Debt Service Coverage Ratio is not less than
                                    1.3.
<PAGE>

                                      -8-

                             (ii)   all Authorizations required for the normal
                                    operation of the Project and the performance
                                    by the Co-Borrowers of their respective
                                    obligations under the Transaction Documents
                                    have been obtained and remain in full force
                                    and effect;

                             (iii)  no Event of Default or Potential Event of
                                    Default has occurred and is continuing;

                             (iv)   the Co-Borrowers have delivered to IFC a
                                    notice, together with supporting data,
                                    signed by an Authorized Representative and
                                    verified by a party acceptable to IFC,
                                    certifying that the requirements set out in
                                    paragraphs (i) through (vi) above have been
                                    fulfilled; and

                             (v)    IFC has notified the Co-Borrowers that the
                                    Co-Borrower's notice is acceptable to IFC;

"PSMT Aruba"                 Islands Foods and Distributors N.V., a corporation
                             organized and existing under the laws of Aruba;

"PSMT Barbados"              PSMT (Barbados) Inc., a company organized and
                             existing under the laws of Barbados;

"PSMT Caribe Pledge
 Agreements"                 the pledge agreements, each of even date herewith
                             and entered into between PSMT Caribe and IFC,
                             whereby PSMT Caribe pledges all of the shares it
                             owns in PSMT Honduras, PriceSmart El Salvador, PSMT
                             Costa Rica, and PSMT Dominicana, respectively, as
                             security for the Loans;

"PSMT Costa Rica"            Prismar de Costa Rica, S.A., a SOCIEDAD ANONIMA
                             organized and existing under the laws of Costa
                             Rica;

"PSMT Dominicana"            PriceSmart Dominicana, S.A., a SOCIEDAD ANONIMA
                             organized and existing under the laws of the
                             Dominican Republic;

"PSMT Honduras"              PriceSmart Honduras, S.A., a SOCIEDAD ANONIMA
                             organized and existing under the laws of Honduras;

"PSMT Panama"                PriceCostco de Panama, S.A., a SOCIEDAD ANONIMA
                             organized and existing under the laws of Panama;

"PSMT Philippines"           PSMT Philippines, Inc., a corporation organized and
                             existing under the laws of the Republic of the
                             Philippines;

<PAGE>
                                      -9-

"Security Documents"         the documents, each acceptable to IFC, providing
                             for the IFC Security consisting of:

                             (i)    a first ranking mortgage over the immovable
                                    assets and equipment of the Co-Borrowers
                                    listed in Annex C;

                             (ii)   a first ranking pledge over the movable
                                    assets of the Co-Borrowers listed in Annex
                                    C;

                             (iii)  a first ranking security interest over the
                                    Escrow Account;

                             (iv)   the Assignment of Insurance Proceeds;

                             (v)    the PriceSmart Pledge Agreements; and

                             (vi)   the PSMT Caribe Pledge Agreements;

"Share Retention
 Agreement"                  the agreement entitled "Share Retention Agreement"
                             dated the date of this Agreement among PriceSmart,
                             PSMT Caribe, PSMT Trinidad, PSMT Barbados, PSMT
                             Philippines, PSMT Aruba, PriceSmart Guatemala, PSMT
                             Honduras, PriceSmart El Salvador, PSMT Costa Rica,
                             PSMT Dominicana, PSMT Panama and IFC;

"Spread"                     four per cent (4%) per annum;

"Subsidiary"                 with respect to any Person, any entity:

                             (i)    over 50% of whose capital is owned, directly
                                    or indirectly, by that Person;

                             (ii)   for which that Person may nominate or
                                    appoint a majority of the members of the
                                    board of directors or such other body
                                    performing similar functions; or

                             (iii)  which is otherwise effectively controlled by
                                    that Person;

"Taxes"                      any present or future taxes, withholding
                             obligations, duties and other charges of whatever
                             nature  levied by any Authority;

"Transaction Documents"      (i)    this Agreement;

                             (ii)   Escrow Account Agreement;

                             (iii)  the Security Documents;

<PAGE>
                                      -10-

                             (iv)   the Share Retention Agreement; and

                             (v)    the C Loan Agreement;

"World Bank"                 the International Bank for Reconstruction and
                             Development, an international organization
                             established by Articles of Agreement among its
                             member countries.

        Section 1.02. FINANCIAL DEFINITIONS. (a) Wherever used in this
Agreement, unless the context otherwise requires, the following terms have the
meanings opposite them:

"Back-to-Back Loans"         loans or other advances to any Co-Borrower or its
                             Subsidiaries that are collateralized by cash or
                             cash-equivalent deposits of any Co-Borrower or
                             Subsidiary of a Co-Borrower;

"Cash Generation"            for any period, the aggregate of:

                             (i)    Consolidated Net Income after deduction of
                                    taxes, workers and employees' participation
                                    in profits, and provisions for losses during
                                    the relevant period; plus

                             (ii)   depreciation and amortization for the
                                    relevant period; plus/minus

                             (iii)  net working capital applications; minus

                             (iv)   any foreign exchange gain or loss or any
                                    other non-cash items included in such net
                                    income after tax; plus

                             (v)    any deferred taxes or other non-cash changes
                                    or provisions charged against Net Income;
                                    plus

                             (vi)   to the extent that the PriceSmart charges
                                    all pre-opening expenses in the year such
                                    expenses are incurred, expenses related to
                                    the pre-opening of particular deep-discount
                                    membership warehouses, owned and operated by
                                    a Co-Borrower;

"Consolidated" or
"Consolidated Basis"         (with respect to any financial statements to be
                             provided, or any financial calculation to be made,
                             under or for the purposes of this Agreement and any
                             other Transaction Document) the method referred to
                             in Section 1.03(d) (FINANCIAL CALCULATIONS); and
                             the

<PAGE>
                                      -11-

                             entities whose accounts are to be consolidated with
                             the accounts of PriceSmart include all of its
                             Subsidiaries;

"Current Assets"             as of the relevant date of calculation,
                             Consolidated cash, marketable securities, trade
                             and other receivables realizable within one year,
                             inventories and prepaid expenses which are to be
                             charged to income within one year, but excluding
                             funds from any disbursement of the Loans and other
                             Project loans temporarily on hand pending
                             application to the Project;

"Current Liabilities"        as of the relevant date of calculation,
                             Consolidated liabilities falling due on demand or
                             within one year (including the portion of
                             Long-term Debt falling due within one year), but
                             excluding liabilities for the Project to the
                             extent they are to be paid off with the proceeds
                             of the Loans and any other Project loans that were
                             excluded from the calculation of Current Assets;

"Current Ratio"              the result obtained by dividing Current Assets by
                             Current Liabilities;

"Indebtedness for
 Borrowed Money "            all obligations (excluding Back-to-Back Loans) of
                             the Co-Borrowers to repay money (other than that
                             constituting trade liabilities incurred in the
                             ordinary course of business and payable in
                             accordance with customary practices, operating
                             lease obligations and other items commonly
                             considered current payables under Accounting
                             Principles) including, without limitation, with
                             respect to:

                             (i)    borrowed money;

                             (ii)   the outstanding principal amount of any
                                    bonds, debentures, notes, loan stock,
                                    commercial paper, acceptance credits, bills
                                    or promissory notes drawn, accepted,
                                    endorsed or issued by the Co-Borrowers;

                             (iii)  any credit to a Co-Borrower from a supplier
                                    of goods or services under any installment
                                    purchase or other similar arrangement with
                                    respect to goods or services (except trade
                                    accounts that are payable in the ordinary
                                    course of business and included in Current
                                    Liabilities);

                             (iv)   non-contingent obligations of the
                                    Co-Borrowers to reimburse any other
                                    Person with respect to amounts paid by that\
                                    Person under a letter of credit or similar
                                    instrument

<PAGE>
                                      -12-

                                    (excluding any letter of credit or similar
                                    instrument issued for the benefit of the
                                    Co-Borrowers with respect to trade accounts
                                    that are payable in the ordinary course of
                                    business and included in Current
                                    Liabilities);

                             (v)    amounts raised under any other transaction
                                    having the financial effect of a borrowing
                                    and which would be classified as a borrowing
                                    (and not as an off-balance sheet financing)
                                    under the Accounting Principles including,
                                    without limitation, under leases or similar
                                    arrangements entered into primarily as a
                                    means of financing the acquisition of the
                                    asset leased;

                             (vi)   the amount of the Co-Borrowers' obligations
                                    pursuant to Derivative Transactions which
                                    consist of swap, collar and cap agreements
                                    entered into in connection with other Total
                                    Debt of the Co-Borrowers, provided that for
                                    the avoidance of double counting and for so
                                    long as any such swap, collar or cap
                                    agreement is in effect, that Total Debt will
                                    be included in Indebtedness for Borrowed
                                    Money pursuant to the terms of the relevant
                                    Derivative Transaction and not the terms of
                                    the agreement providing for that Total Debt
                                    when it was incurred; and

                             (vii)  any premium payable on a mandatory
                                    redemption or replacement of any of the
                                    foregoing obligations;

"Interest Expense"           as of the relevant date of calculation, all
                             interest (excluding interest on Back-to-Back
                             Loans) and charges paid or payable by the
                             Co-Borrowers, on the aggregate Indebtedness for
                             Borrowed Money during the period immediately
                             preceding the date of calculation;

"Long-term Debt"             that part of the Consolidated Indebtedness
                             for Borrowed Money (excluding Back-to-Back Loans)
                             the final maturity of which, by its terms or the
                             terms of any agreement relating to it, falls due
                             more than one year after the date of its
                             incurrence;

"Long-term Debt Service
 Coverage Ratio"             the ratio obtained by dividing:

                             (i)    the sum of the Cash Generation for the
                                    Financial Year preceding the date of
                                    calculation;

                                    by

<PAGE>
                                      -13-

                             (ii)   the Long-term Debt Service Payments
                                    (principal and interest) due for payment of
                                    the Financial Year having the highest
                                    scheduled total annual Consolidated
                                    Long-term Debt principal payments by the
                                    Co-Borrowers during the life of the A Loan;

"Long-term Debt
 Service Payments"           as of the relevant date for calculation, for the
                             Co-Borrowers, the aggregate of:

                             (i)    the amount of the payments of principal of
                                    all Long-term Debt (in accordance with the
                                    respective terms thereof) during the period
                                    for which the calculation is being made
                                    (excluding the C Loan bullet principal
                                    payment); and

                             (ii)   the Interest Expense for such period;

"Long-term Debt
 to Equity Ratio"            the result obtained by dividing Long-term Debt by
                             Shareholders' Equity plus Long-term Debt;

"Net Fixed Assets"           the aggregate amount of assets which at any time
                             would be reflected as Net Fixed Asssets of the
                             Co-Borrowers (taken as a whole) on a Consolidated
                             balance sheet of the Co-Borrowers prepared in
                             accordance with Accounting Principles;

"Net Income"                 as of the relevant date for calculation, the
                             difference between revenues generated through the
                             sale of goods delivered and services rendered, and
                             the costs incurred in the process of production and
                             delivery of those goods and services, during any
                             Financial Year. (At IFC's sole discretion,
                             extraordinary items, like goodwill and others, will
                             be excluded from the above calculation, and
                             reasonable expense provisioning for doubtful
                             collection of receivables and inventory
                             obsolescence will be included in the above
                             calculation.);

"Non-Cash Items"             for any period, the net aggregate amount (which
                             may be a positive or negative number) of all
                             non-cash expenses and non-cash credits which have
                             been subtracted or, as the case may be, added in
                             calculating net income during that period,
                             including, without limitation, depreciation,
                             amortization, deferred taxes, provisions for
                             severance pay of staff and workers, and credits
                             resulting from revaluation of the assets' book
                             value;

<PAGE>
                                      -14-

"Shareholders' Equity"       the aggregate (as of the relevant date of
                             calculation) of:

                             (i)    the amount paid up or credited as paid up on
                                    the Consolidated share capital of all of the
                                    Co-Borrowers; and

                             (ii)   the amount standing to the credit of the
                                    reserves of all of the Co-Borrowers
                                    (including, without limitation, any share
                                    premium account, capital redemption reserve
                                    funds and any credit balance on the
                                    accumulated profit and loss account);

                             after deducting from that aggregate (A) any debit
                             balance on the profit and loss account or
                             impairment of the issued share capital of all of
                             the Co-Borrowers (except to the extent that
                             deduction with respect to that debit balance or
                             impairment has already been made), (B) amounts set
                             aside for dividends or taxation (including deferred
                             taxation), and (C) amounts attributable to
                             capitalized items such as goodwill, trademarks,
                             deferred charges, licenses, patents and other
                             intangible assets;

"Short-term Debt"            all Consolidated Indebtedness for Borrowed Money
                             (as of the relevant date of calculation) other
                             than Consolidated Long-term Debt;

"Total Debt"                 the aggregate of all obligations (whether actual
                             or contingent, but excluding Back-to-Back Loans)
                             of the Co-Borrowers to pay or repay money (other
                             than that constituting trade liabilities incurred
                             in the ordinary course of business and payable in
                             accordance with customary practices, operating
                             lease obligations and other items commonly
                             considered current payables under Accounting
                             Principles) including, without limitation:

                             (i)    all Indebtedness for Borrowed Money;

                             (ii)   the aggregate amount then outstanding of all
                                    liabilities of any party to the extent any
                                    of the Co-Borrowers guarantees them or
                                    otherwise directly or indirectly obligates
                                    itself to pay them;

                             (iii)  all liabilities of the Co-Borrowers (actual
                                    or contingent) under any conditional sale or
                                    a transfer with recourse or obligation to
                                    repurchase, including, without limitation,
                                    by way of discount or factoring of book
                                    debts or receivables;

                             (iv)   all liabilities of the Co-Borrowers (actual
                                    or contingent) under their respective
                                    Charters, any resolution of their

<PAGE>
                                      -15-

                                    respective shareholders, or any agreement or
                                    other document binding on any Co-Borrower to
                                    redeem any of its shares; and

                             (v)    all Capital Lease Obligations of the
                                    Co-Borrowers; and

"Total Debt to
 Equity Ratio"                      means the result obtained by dividing Total
                                    Debt by Shareholders' Equity plus Total
                                    Debt.

         Section 1.03. FINANCIAL CALCULATIONS. (a) All financial calculations to
be made under, or for the purposes of, this Agreement and any other Transaction
Document shall be determined in accordance with the Accounting Principles and,
except as otherwise required to conform to any provision of this Agreement,
shall be calculated from the then most recently issued quarterly financial
statements which the Co-Borrowers are obligated to furnish to IFC under Section
6.03(a) (REPORTING REQUIREMENTS).

        (b)  Where quarterly financial statements are used for the purpose of
making certain financial calculations and those statements are with respect to
the last quarter of a Financial Year then, at IFC's option, those calculations
may instead be made from the audited financial statements for the relevant
Financial Year.

        (c)  If any material adverse change in the financial condition of any of
the Co-Borrowers has occurred after the end of the period covered by the
financial statements used to make the relevant financial calculations, that
material adverse change shall also be taken into account in calculating the
relevant figures.

        (d)  If a financial calculation is to be made under or for the purposes
of this Agreement or any other Transaction Document on a Consolidated Basis,
that calculation shall be made by reference to the sum of all amounts of similar
nature reported in the relevant financial statements of each of the entities
whose accounts are to be consolidated with the accounts of the Co-Borrowers plus
or minus the consolidation adjustments customarily applied to avoid double
counting of transactions among any of those entities, including the
Co-Borrowers.

         Section 1.04. INTERPRETATION. In this Agreement, unless the context
otherwise requires:

        (a)  headings are for convenience only and do not affect the
interpretation of this Agreement;

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

        (c)  a reference to an Annex, Article, party, Schedule or Section is a
reference to that Article or Section of, or that Annex, party or Schedule to,
this Agreement;

<PAGE>
                                      -16-

        (d)  a reference to a document includes an amendment or supplement to,
or replacement or novation of, that document but disregarding any amendment,
supplement, replacement or novation made in breach of this Agreement; and

        (e)  a reference to a party to any document includes that party's
successors and permitted assigns.

        Section 1.05. BUSINESS DAY ADJUSTMENT. When the day on or by which a
payment is due to be made is not a Business Day, that payment shall be made on
or by the next succeeding Business Day unless, in the case of payments of
principal or interest, that next succeeding Business Day falls in a different
calendar month, in which case that payment shall be made on the immediately
preceding Business Day. Interest, fees and charges (if any) shall continue to
accrue for the period from the due date that is not a Business Day to that next
succeeding Business Day.

                                   ARTICLE II

                  THE PROJECT, PROJECT COST AND FINANCIAL PLAN

        Section 2.01. THE PROJECT. The project to be financed consists of the
construction, equipping and placing into operation and the provision of working
capital for thirteen (13) deep discount membership-shopping warehouses to be
located in Central America and the Caribbean, as further described in the Letter
of Information provided by the Co-Borrowers to IFC.

         Section 2.02. PROJECT COST AND FINANCIAL PLAN.* (a) The total estimated
cost of the Project, including an increase of not less than the equivalent of
$13,200,000 for working capital, is the equivalent of $127,000,000, as follows:

<TABLE>
<CAPTION>
                                                                  US$
                               PROJECT COST                     MILLIONS       %
              ------------------------------------------------ ----------- ----------
                                                                 (or
                                                               equivalent)
              <S>                                                <C>         <C>
              Land                                                  24.5      19.3
              Construction                                          49.2      38.7
              Furniture, fixtures & equipment                       29.7      23.3
              Pre-opening                                           10.5       8.3
              Working capital                                       13.2      10.4
                                                                    ----      ----
              TOTAL PROJECT COST                                   127.0     100.0
              ------------------------------------------------ ----------- ----------
</TABLE>

<PAGE>
                                      -17-

        (b)  The proposed sources of financing for the Project are as follows:

<TABLE>
<CAPTION>
                                                      US$
              Financial Plan                        Million         %
              ----------------------------------- ------------- -----------
                                                    (or
                                                  equivalent)
              <S>                                   <C>          <C>
              LONG TERM LOANS

                 IFC A Loan                           $22.0        17.2%
                 IFC C Loan                            10.0         7.9%
                 OPIC Loan                             10.0         7.9%
                 Other Long-term Debt (existing)       21.5        17.0%

              EQUITY

                 Sponsor's Equity                      63.6        50.0%

              TOTAL FINANCING                        $127.1       100.0%
              ----------------------------------- ------------- -----------
</TABLE>

                                   ARTICLE III

                                   THE A LOAN

        Section 3.01. A LOAN. Subject to the provisions of this Agreement, IFC
agrees to lend, and the Co-Borrowers agree to borrow jointly and severally, the
A Loan being twenty-two million Dollars ($22,000,000).

        Section 3.02. DISBURSEMENT PROCEDURE. (a) The Co-Borrowers may request
Disbursements by delivering to IFC, at least ten (10) Business Days prior to the
proposed date of Disbursement, a Disbursement request substantially in the form
of Schedule 2 and a receipt substantially in the form of Schedule 3.

        (b)  Each Disbursement shall be made by IFC at a bank in New York, New
York for further credit to the Co-Borrowers' respective accounts at a bank in
the respective Countries, or any other place acceptable to IFC, all as specified
by the Co-Borrowers in the relevant Disbursement request; provided, however,
that the first disbursement shall be made, in whole or

<PAGE>
                                      -18-

in part, by IFC to the credit of the Co-Borrowers' existing creditors, as the
Co-Borrowers shall specify on the Disbursement request.

        (c)  Each Disbursement (other than the last one) shall be made in an
amount of not less than three million Dollars ($3,000,000).

        (d)  Notwithstanding any provision in this Agreement, each of PSMT
Caribe and PSMT Trinidad irrevocably appoints and designates PriceSmart as its
agent for the purpose of receiving any notice or request and further authorizes
PriceSmart to make the request provided in Section 3.02(b) or any other request
permitted to be made by the Co-Borrowers under this Agreement, to receive all
disbursements to be made hereunder, to sign the receipts provided for in Section
3.02(b), and to take any other action required or permitted to be taken on its
behalf under this Agreement.

         Section 3.03. INTEREST. Subject to the provisions of Section 3.05
(DEFAULT RATE INTEREST), the Co-Borrowers shall pay interest on the A Loan in
accordance with this Section 3.03:

        (a)  During each Interest Period, the A Loan (or, with respect to the
first Interest Period for each Disbursement, the amount of that Disbursement)
shall bear interest at the applicable Interest Rate for that Interest Period.

        (b)  Interest on the A Loan shall accrue from day to day, be prorated on
the basis of a 360-day year for the actual number of days in the relevant
Interest Period and be payable in arrears on the Interest Payment Date
immediately following the end of that Interest Period; provided that with
respect to any Disbursement made less than fifteen (15) days before an Interest
Payment Date, interest on that Disbursement shall be payable commencing on the
second Interest Payment Date following the date of that Disbursement.

        (c)  The Interest Rate for any Interest Period shall be the rate which
is the sum of:

               (i)    the Spread; and

               (ii)   LIBOR on the Interest Determination Date for that Interest
                      Period for six (6) months (or, in the case of the first
                      Interest Period for any Disbursement, for one (1) month,
                      two (2) months, three (3) months or six (6) months,
                      whichever period is closest to the duration of the
                      relevant Interest Period (or, if two periods are equally
                      close, the longer one)) rounded upward to the nearest
                      three decimal places.

        (d)  If, for any Interest Period IFC cannot determine LIBOR by reference
to the Telerate Service or any other service that displays BBA rates, IFC shall
notify the Co-Borrowers and shall instead determine LIBOR:

<PAGE>
                                      -19-

               (i)    on the second Business Day before the beginning of the
                      relevant Interest Period by calculating the artimetic mean
                      (rounded upward to the nearest three decimal places) of
                      the offered rates advised to IFC on or around 11:00 a.m.,
                      London time, for deposits in Dollars and otherwise in
                      accordance with Section 3.03(c)(ii), by any four (4) major
                      banks active in Dollars in the London interbank market,
                      selected by IFC; provided that if less than four
                      quotations are received, IFC may rely on the quotations so
                      received if not less than two (2); or

               (ii)   if less than two (2) quotations are received from the
                      banks in London in accordance with subsection (i) above,
                      on the first day of the relevant Interest Period, by
                      calculating the arithmetic mean (rounded upward to the
                      nearest three decimal places) of the offered rates advised
                      to IFC on or around 11:00 a.m. New York time, for loans in
                      Dollars and otherwise in accordance with Section
                      3.03(c)(ii), by a major bank or banks in New York, New
                      York, selected by IFC.

        (e)  On each Interest Determination Date for any Interest Period, IFC
shall determine the Interest Rate applicable to that Interest Period and
promptly notify the Co-Borrowers of that rate.

        (f)  The determination by IFC, from time to time, of the Interest Rate
shall be final and conclusive and bind the Co-Borrowers (unless the Co-Borrowers
show to IFC's satisfaction that the determination involves manifest error).

        Section 3.04. DEFAULT RATE INTEREST. (a) Without limiting the remedies
available to IFC under this Agreement or otherwise (and to the maximum extent
permitted by applicable law), if the Co-Borrowers fail to make any payment of
principal or interest (including interest payable pursuant to this Section) or
any other payment provided for in Section 3.07 (FEES) when due as specified in
this Agreement (whether at stated maturity or upon acceleration), the
Co-Borrowers shall pay interest on the amount of that payment due and unpaid at
the rate which shall be the sum of two per cent (2%) per annum and the Interest
Rate in effect from time to time;

        (b)  Interest at the rate referred to in Section 3.04(a) shall accrue
from the date on which payment of the relevant overdue amount became due until
the date of actual payment of that amount (as well after as before judgment),
and shall be payable on demand or, if not demanded, on each Interest Payment
Date falling after any such overdue amount became due.

<PAGE>
                                      -20-

         Section 3.05. REPAYMENT. (a) The Co-Borrowers shall repay the A Loan on
the following dates and in the following amounts:

<TABLE>
<CAPTION>
               DATE PAYMENT DUE             PRINCIPAL AMOUNT DUE
               <S>                             <C>
               March 15, 2003                    $ 1,375,000
               September 15, 2003                  1,375,000
               March 15, 2004                      1,375,000
               September 15, 2004                  1,375,000
               March 15, 2005                      1,375,000
               September 15, 2005                  1,375,000
               March 15, 2006                      1,375,000
               September 15, 2006                  1,375,000
               March 15, 2007                      1,375,000
               September 15, 2007                  1,375,000
               March 15, 2008                      1,375,000
               September 15, 2008                  1,375,000
               March 15, 2009                      1,375,000
               September 15, 2009                  1,375,000
               March 15, 2010                      1,375,000
               September 15, 2010                  1,375,000
                                                 -----------
                                                 $22,000,000
                                                 ===========
</TABLE>

        (b)  The dates for repayment of principal of the A Loan are intended to
coincide with the Interest Payment Dates.

        (c)  Upon each Disbursement, the amount disbursed shall be allocated for
repayment on each of the respective dates for repayment of principal set out in
the table in Section 3.05(a) in amounts which are PRO RATA to the amounts of the
respective installments shown opposite those dates in that table (with IFC
adjusting those allocations as necessary so as to achieve whole numbers in each
case).

        Section 3.06.  PREPAYMENT.  Subject to Section 6.04(c),

        (a)  the Co-Borrowers may prepay on any Interest Payment Date all or any
part of the A Loan, on not less than forty-five (45) days' prior notice to IFC,
but only if:

               (i)    the Co-Borrowers simultaneously pay all accrued interest
                      and Increased Costs (if any) on the amount of the A Loan
                      to be prepaid, together with the prepayment premium
                      specified in Section 3.06(b) and all other amounts then
                      due and payable under this Agreement, including the amount
                      payable under Section 3.11 (UNWINDING COSTS), if the
                      prepayment is not made on an Interest Payment Date;

<PAGE>
                                      -21-

               (ii)   the Co-Borrowers simultaneously prepay a PRO RATA portion
                      of the OPIC Loan;

               (iii)  for a partial prepayment, that prepayment is in an amount
                      not less than three million Dollars ($3,000,000); and

               (iv)   if requested by IFC, the Co-Borrowers deliver to IFC,
                      prior to the date of prepayment, evidence satisfactory to
                      IFC that all necessary Authorizations with respect to the
                      prepayment have been obtained.

        (b)  On the date of any prepayment of the A Loan in accordance with
Section 3.06 (a), the Co-Borrowers shall pay a prepayment premium consisting of
an amount in Dollars equal to: at the Co-Borrowers' option, either: (i) one and
one-half per cent (1 1/2%) of the prepaid amount times the number of years from
the prepayment date to the scheduled final maturity date of the A Loan; or (ii)
IFC's redeployment cost pursuant to Section 3.11.

        The determination by IFC of the prepayment premium shall be final and
conclusive and bind the Co-Borrowers (unless the Co-Borrowers show, to the
satisfaction of IFC, that such determination involved manifest error).

        (c)  Amounts of principal prepaid under this Section shall be applied by
IFC to all the respective outstanding installments of principal of the A Loan on
a PRO-RATA basis.

        (d)  Upon delivery of a notice in accordance with Section 3.06(a), the
Co-Borrowers shall make the prepayment in accordance with the terms of that
notice.

        (e)  Any principal amount of the A Loan prepaid under this Agreement may
not be re-borrowed.

        Section 3.07. FEES. (a) The Co-Borrowers shall pay to IFC a commitment
fee at the rate of one-half of one per cent (1/2%) per annum on that part of the
A Loan which from time to time has not been disbursed or cancelled. The
commitment fee shall:

               (i)    begin to accrue on the date of this Agreement;

               (ii)   be PRO RATED on the basis of a 360-day year for the actual
                      number of days elapsed; and

               (iii)  be payable semi-annually, in arrears, on the Interest
                      Payment Dates in each year, the first such payment to be
                      due on March 15, 2001.

        (b)  The Co-Borrowers shall also pay to IFC a front-end fee of two
hundred twenty thousand Dollars ($220,000), to be paid upon the earlier of (x)
the date which is thirty (30) days after the date of this Agreement and (y) the
date immediately preceding the date of the first Disbursement.

<PAGE>
                                      -22-

        Section 3.08. CURRENCY AND PLACE OF PAYMENTS. (a) The Co-Borrowers shall
make all payments of principal, interest, fees, and any other amount due to IFC
under this Agreement in Dollars, in same day funds, to Citibank, N.A., 111 Wall
Street, New York, New York, U.S.A., ABA#021000089, for credit to IFC's account
number 36085579, or at such other bank or account in New York as IFC from time
to time designates. Payments must be received in IFC's designated account no
later than 1:00 p.m. New York time.

        (b)  The tender or payment of any amount payable under this Agreement
(whether or not by recovery under a judgment) in any currency other than Dollars
shall not novate, discharge or satisfy the obligation of the Co-Borrowers to pay
in Dollars all amounts payable under this Agreement except to the extent that
(and as of the date when) IFC actually receives funds in Dollars in the account
specified in, or pursuant to, Section 3.08(a).

        (c)  The Co-Borrowers shall indemnify IFC against any losses resulting
from a payment being received or an order or judgment being given under this
Agreement in any currency other than Dollars or any place other than the account
specified in, or pursuant to, Section 3.08(a). The Co-Borrowers shall, as a
separate obligation, pay such additional amount as is necessary to enable IFC to
receive, after conversion to Dollars at a market rate and transfer to that
account, the full amount due to IFC under this Agreement in Dollars and in the
account specified in, or pursuant to, Section 3.08(a).

        (d)  Notwithstanding the provisions of Section 3.08(a) and Section
3.08(b), IFC may require the Co-Borrowers to pay (or reimburse IFC) for any
Taxes, fees, costs, expenses and other amounts payable under Section 3.14(a)
(TAXES) and Section 3.15 (EXPENSES) in the currency in which they are payable,
if other than Dollars.

        Section 3.09. ALLOCATION OF PARTIAL PAYMENTS. If at any time IFC
receives less than the full amount then due and payable to it under this
Agreement, IFC may allocate and apply the amount received in any way or manner
and for such purpose or purposes under this Agreement as IFC in its sole
discretion determines, notwithstanding any instruction that the Co-Borrowers may
give to the contrary.

        Section 3.10. INCREASED COSTS. On each Interest Payment Date, the
Co-Borrowers shall pay, in addition to interest, the amount which IFC from time
to time notifies the Co-Borrowers in an Increased Costs Certificate as being the
aggregate Increased Costs of IFC accrued and unpaid prior to that Interest
Payment Date.

        Section 3.11. UNWINDING COSTS. (a) If IFC incurs any cost, expense or
loss as a result of the Co-Borrowers:

               (i)    failing to borrow in accordance with a request for
                      Disbursement made pursuant to Section 3.02 (DISBURSEMENT
                      PROCEDURE), or to prepay in accordance with a notice of
                      prepayment; or

<PAGE>
                                      -23-

               (ii)   prepaying all or any portion of the A Loan on a date other
                      than an Interest Payment Date;

then the Co-Borrowers shall immediately pay to IFC the amount which IFC from
time to time notifies to the Co-Borrowers as being the amount of those costs,
expenses and losses incurred.

        (b)  For the purposes of this Section, "costs, expenses or losses"
include any premium, penalty or expense incurred to liquidate or obtain third
party deposits or borrowings in order to make, maintain or fund all or any part
of the A Loan.

        Section 3.12. SUSPENSION OR CANCELLATION BY IFC. (a) IFC may, by notice
to the Co-Borrowers, suspend the right of the Co-Borrowers to Disbursements or
cancel the undisbursed portion of the A Loan in whole or in part:

               (i)    if the first Disbursement has not been made by July 25,
                      2001, or such other date as the parties agree;

               (ii)   if any Event of Default has occurred and is continuing or
                      if the Event of Default specified in Section 7.02(f)
                      (EVENTS OF DEFAULT) is, in the reasonable opinion of IFC,
                      imminent;

               (iii)  if any event or condition has occurred which has or can
                      reasonably be expected to have a Material Adverse
                      Effect; or

               (v)    on or after January 26, 2003.

        (b)  Upon the giving of any such notice, the right of the Co-Borrowers
to any further Disbursement shall be suspended or cancelled, as the case may be.
The exercise by IFC of its right of suspension shall not preclude IFC from
exercising its right of cancellation, either for the same or any other reason
specified in Section 3.12(a). Upon any cancellation the Co-Borrowers shall,
subject to paragraph (d) of this Section 3.12, pay to IFC all fees and other
amounts accrued (whether or not then due and payable) under this Agreement up to
the date of that cancellation. A suspension shall not limit any other provision
of this Agreement.

        (c)  Any portion of the A Loan that is cancelled under this Section 3.12
may not be reborrowed.

        (d)  In the case of a partial cancellation of the A Loan pursuant to
paragraph (a) of this Section 3.12, or Section 3.13(a) below, interest on the
amount then outstanding of the A Loan remains payable as provided in Section
3.03 (INTEREST).

        Section 3.13. CANCELLATION BY THE CO-BORROWERS. (a) The Co-Borrowers
may, by notice to IFC, irrevocably request IFC to cancel the undisbursed portion
of the A Loan on the date specified in that notice (which shall be a date not
earlier than thirty (30) days after the date of that notice).

<PAGE>
                                      -24-

        (b)  IFC shall, by notice to the Co-Borrowers, cancel the undisbursed
portion of the A Loan effective as of that specified date if, subject to Section
3.12(d) above:

               (i)    IFC has received all fees and other amounts accrued
                      (whether or not then due and payable) under this Agreement
                      up to such specified date; and

               (ii)   if any amount of the A Loan is then outstanding, IFC is
                      reasonably satisfied that the Co-Borrowers have sufficient
                      long-term funding available, on terms satisfactory to IFC,
                      to cause the Project Financial Completion Date to occur as
                      scheduled.

        (c)  Any portion of the A Loan that is cancelled under this Section 3.13
may not be reborrowed.

        Section 3.14. TAXES. (a) The Co-Borrowers shall pay or cause to be paid
all Taxes other than taxes, if any, payable on the overall income of IFC on or
in connection with the payment of any and all amounts due under this Agreement
that are now or in the future levied or imposed by any Authority of the Country
or by any organization of which the Country is a member or any jurisdiction
through or out of which a payment is made.

        (b)  All payments of principal, interest, fees and other amounts due
under this Agreement shall be made without deduction for or on account of any
Taxes.

        (c)  If the Co-Borrowers are prevented by operation of law or otherwise
from making or causing to be made those payments without deduction, the
principal or (as the case may be) interest, fees or other amounts due under this
Agreement shall be increased to such amount as may be necessary so that IFC
receives the full amount it would have received (taking into account any Taxes
payable on amounts payable by the Co-Borrowers under this subsection) had those
payments been made without that deduction.

        (d)  If Section 3.14 (c) applies and IFC so requests, the Co-Borrowers
shall deliver to IFC official tax receipts evidencing payment (or certified
copies of them) within thirty (30) days of the date of that request.

        Section 3.15. EXPENSES. (a) The Co-Borrowers shall pay or, as the case
may be, reimburse IFC or its assignees any amount paid by them on account of,
all taxes (including stamp taxes), duties, fees or other charges payable on or
in connection with the execution, issue, delivery, registration or notarization
of the Transaction Documents and any other documents related to this Agreement
or any other Transaction Document.

        (b)    The Co-Borrowers shall pay to IFC or as IFC may direct:

               (i)    the reasonable fees and expenses of IFC's technical
                      consultants incurred in connection with the investment by
                      IFC provided for under this Agreement;

<PAGE>
                                      -25-

               (ii)   the fees and expenses of IFC's counsel in each of the
                      Countries incurred in connection with:

                        (A)     the preparation of the investment by IFC
                                provided for under this Agreement and any other
                                Transaction Document;

                        (B)     the preparation and/or review, execution and,
                                where appropriate, translation and registration
                                of the Transaction Documents and any other
                                documents related to them;

                        (C)     the giving of any legal opinions required by IFC
                                under this Agreement and any other Transaction
                                Document;

                        (D)     the administration by IFC of the investment
                                provided for in this Agreement or otherwise in
                                connection with any amendment, supplement or
                                modification to, or waiver under, any of the
                                Transaction Documents;

                        (E)     the registration (where appropriate) and the
                                delivery of the evidences of indebtedness
                                relating to the A Loan and its disbursement; and

                        (F)     the occurrence of any Event of Default or
                                Potential Event of Default;

               (iii)  in each calendar year thereafter upon receipt of a
                      statement from IFC, the amount of twenty-five thousand
                      Dollars ($25,000) on account of IFC's expenses in carrying
                      out its annual supervision review of the Co-Borrowers and
                      the Project; and

               (iv)   the costs and expenses incurred by IFC in relation to
                      efforts to enforce or protect its rights under any
                      Transaction Document, or the exercise of its rights or
                      powers consequent upon or arising out of the occurrence of
                      any Event of Default or Potential Event of Default,
                      including legal and other professional consultants' fees
                      on a full indemnity basis.

<PAGE>
                                      -26-

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

        Section 4.01. REPRESENTATIONS AND WARRANTIES. Each Co-Borrower
represents and warrants that:

        (a)  it is a company duly incorporated and validly existing under the
laws of its Country and has the corporate power - and has obtained all required
Authorizations - to own its assets, conduct its business as presently conducted
and to enter into, and comply with its obligations under, the Transaction
Documents to which it is a party or will, in the case of any Transaction
Document not executed as at the date of this Agreement, when that Transaction
Document is executed, have the corporate power to enter into, and comply with
its obligations under, that Transaction Document;

        (b)  each Transaction Document to which it is a party has been, or will
be, duly authorized and executed by it and constitutes, or will, when executed
constitute, a valid and legally binding obligation of such Co-Borrower,
enforceable in accordance with its terms;

        (c)  neither the making of any Transaction Document to which it is a
party nor (when all the Authorizations referred to in Section 5.01(e)
(CONDITIONS OF Disbursement) have been obtained) the compliance with its terms
will conflict with or result in a breach of any of the terms, conditions or
provisions of, or constitute a default or require any consent under, any
indenture, mortgage, material agreement or other material instrument or
arrangement to which it is a party or by which it is bound, or violate any of
the terms or provisions of its Charter or any Authorization, judgment, decree or
order or any statute, rule or regulation applicable to such Co-Borrower;

        (d)  to the best of its knowledge after due inquiry:

               (i)    the Authorizations specified in Annex A are all the
                      Authorizations (other than Authorizations that are of a
                      routine nature and are obtained in the ordinary course of
                      business) needed by such Co-Borrower to conduct its
                      business, carry out the Project and execute, and comply
                      with its obligations under, this Agreement and each of the
                      other Transaction Documents to which it is a party;

               (ii)   all Authorizations specified in Section (1) of Annex A
                      have been obtained and are in full force and effect; and

               (iii)  the Co-Borrowers have applied (or are making arrangements
                      to apply) for all Authorizations specified in Section (2)
                      of Annex A, and have no reason to believe that they will
                      not obtain those Authorizations in a timely manner;

<PAGE>
                                      -27-

        (e)  none of the Co-Borrowers' Charters have been amended since August
29, 1997 with respect to PriceSmart, October 21, 1999 with respect to PSMT
Trinidad, and October 22, 1998 with respect to PSMT Caribe;

        (f)  none of the Co-Borrowers nor any of their properties enjoys any
right of immunity from set-off, suit or execution with respect to its assets or
its obligations under any Transaction Document;

        (g)    Since June 30, 2000, none of the Co-Borrowers:

                (i)     has suffered any change that has a Material Adverse
                        Effect or incurred any substantial loss or liability;

                (ii)    has undertaken or agreed to undertake any substantial
                        obligation outside of the ordinary course of business;

        (h)    the Consolidated financial statements of the Co-Borrowers for the
period ending on June 30, 2000:

               (i)    have been prepared in accordance with the Accounting
                      Principles, and present fairly the financial condition of
                      the Co-Borrowers as of the date as of which they were
                      prepared and the results of the Co-Borrowers' operations
                      during the period then ended;

               (ii)   disclose all liabilities (contingent or otherwise) of the
                      Co-Borrowers required by US-GAAP, and the reserves, if
                      any, for such liabilities and all unrealized or
                      anticipated liabilities and losses arising from
                      commitments entered into by the Co-Borrowers required by
                      US-GAAP (whether or not such commitments have been
                      disclosed in such financial statements);

        (i)  none of the Co-Borrowers is a party to, or committed to enter into,
any contract which would or might reasonably affect the judgment of a
prospective Long-term Debt investor;

        (j)  none of the Co-Borrowers has an outstanding Lien on any of its
assets other than Liens arising by operation of law, and no contracts or
arrangements, conditional or unconditional, exist for the creation by any of the
Co-Borrowers of any Lien, except for the IFC Security and the liens set forth in
Annex D;

        (k)  all tax returns and reports of the Co-Borrowers required by law to
be filed have been duly filed and all Taxes, obligations, fees and other
governmental charges upon the Co-Borrowers, or their respective properties, or
their respective income or assets, which are due and payable or to be withheld,
have been paid or withheld, other than those presently payable without penalty
or interest;

<PAGE>
                                      -28-

        (l)  none of the Co-Borrowers is engaged in or, to the best of their
knowledge after due inquiry, threatened by, any litigation, arbitration or
administrative proceedings, the outcome of which could reasonably be expected to
have a Material Adverse Effect;

        (m)  to the best of their knowledge and belief after due inquiry, none
of the Co-Borrowers is in violation of any material statute or regulation of any
Authority;

        (n)  no judgment or order has been issued which has or may reasonably be
expected to have a Material Adverse Effect;

        (o)  to the best of its knowledge and belief, after due inquiry, the
Co-Borrowers are not in violation of any of the Environmental, Health and Safety
Guidelines or of the Environmental and Social Policies;

        (p)  none of the Co-Borrowers has received nor is aware of any
complaint, order, directive, claim, citation or notice from any Authority
with respect to any matter of any Co-Borrower's compliance with the relevant
environmental, health and safety laws and regulations in effect in any
Country such as, without limitation, air emissions, discharges to surface
water or ground water, noise emissions, solid or liquid waste disposal, or
the use, generation, storage, transportation or disposal of toxic or
hazardous substances or wastes;

        (q)  none of the Co-Borrowers, nor any of their Affiliates, nor any
Person acting on its or their behalf, has made, with respect to the Project or
any transaction contemplated by this Agreement, any Prohibited Payment; and

        (r)  none of the representations and warranties in this Section 4.01
omits any matter the omission of which makes any of such representations and
warranties misleading in any material respect.

        Section 4.02. IFC RELIANCE. Each of the Co-Borrowers acknowledges that
it makes the representations and warranties in Section 4.01 (REPRESENTATIONS AND
WARRANTIES) with the intention of inducing IFC to enter into this Agreement and
that IFC enters into this Agreement on the basis of, and in full reliance on,
each of such representations and warranties.

<PAGE>
                                      -29-

                                    ARTICLE V

                           CONDITIONS OF DISBURSEMENT

        Section 5.01. CONDITIONS OF FIRST DISBURSEMENT. The obligation of IFC to
make the first Disbursement is subject to the fulfillment prior to or
concurrently with the making of that first Disbursement of the following
conditions:

        (a) the following agreements, each in form and substance satisfactory to
IFC, have been entered into by all parties to them and have become (or, as the
case may be, remain) unconditional and fully effective in accordance with their
respective terms (except for this Agreement having become unconditional and
fully effective, if that is a condition of any of those agreements), and IFC has
received a copy of each of those agreements to which it is not a party:

                (i)     each Transaction Document; and

                (ii)    the OPIC Loan Agreement;

        (b)  the Co-Borrowers have certified to IFC that no amendment has been
made to their respective Charters since August 29, 1997 with respect to
PriceSmart, October 21, 1999 with respect to PSMT Trinidad, and October 22, 1998
with respect to PSMT Caribe, or if any such amendment was made, IFC has received
a copy of each such Co-Borrower's amended Charter and determined, in its
reasonable judgment, that it is not inconsistent with the provisions of any
Transaction Document and does not have or may not reasonably be expected to have
a Material Adverse Effect;

        (c)  the IFC Security has been duly created and perfected/registered as
first ranking security interests in all assets and rights subject to the
Security Documents;

        (d)  the Co-Borrowers have obtained, and provided to IFC copies of, all
Authorizations listed in Section (1) and Section (2) of Annex A, and such other
Authorizations not listed in those Sections that may become necessary for:

                (i)     the Loans and the OPIC Loan;

                (ii)    the business of each of the Co-Borrowers as it is
                        contemplated to be carried on;

                (iii)   the Project and the implementation of the Financial
                        Plan;

                (iv)    the due execution, delivery, validity and enforceability
                        of, and performance by the Co-Borrowers of their
                        respective obligations under, this Agreement and the
                        other Transaction Documents, and any other

<PAGE>
                                      -30-

                        documents necessary or desirable to the implementation
                        of any of those agreements or documents; and

                (v)     the remittance to IFC or its assigns in Dollars of all
                        monies payable with respect to the Transaction
                        Documents;

        and all those Authorizations are in full force and effect;

        (e)  IFC has received a legal opinion to the effect set out in Schedule
5(A), from IFC's counsel in each of the Countries and concurred in by counsel
for the Co-Borrowers, and covering such other matters relating to the
transactions contemplated by this Agreement as IFC may reasonably request;

        (f)  IFC has received a legal opinion to the effect set out in Schedules
5(B-1), 5(B-2) and 5(B-3) from IFC's counsel in each of the Honduras, Guatemala,
Aruba, the Philippines, El Salvador, Costa Rica, Panama, and Dominican Republic,
and covering such other matters relating to the Share Retention Agreement and
the PSMT Caribe Pledge Agreements, as IFC may reasonably request;

        (g)  IFC has received a legal opinion to the effect set out in Schedule
5(C), from its special counsel in New York with regard to the law aspects of the
Escrow Account Agreement;

        (h)  IFC has received a legal opinion to the effect set out in Schedule
5(D), from PriceSmart's counsel in New York with regard to the law aspects of
this Agreement and the other Transaction Documents;

        (i)  IFC has received a certification from the Auditors confirming that,
as at a date not earlier than sixty (60) days prior to the date of first
Disbursement, the Co-Borrowers are in compliance with the provisions of Section
6.01(c) (AFFIRMATIVE COVENANTS) and containing a brief description of the
systems and records in place;

        (j)  IFC has received copies of all insurance policies required to be
obtained pursuant to Section 6.04 (INSURANCE) and Annex B prior to the date of
first Disbursement, and a certification of the Co-Borrowers' insurers or
insurance agents confirming that such policies are in full force and effect and
all premiums then due and payable under those policies have been paid;

        (k)  IFC has received the fees specified in Section 3.07 (FEES) required
to be paid before the date of the first Disbursement;

        (l)  if IFC so requires, IFC has received the reimbursement of all
invoiced fees and expenses of IFC's counsel as provided in Section 3.15(b)(ii)
(EXPENSES) or confirmation that those fees and expenses have been paid directly
to that counsel;

<PAGE>
                                      -31-

        (m)  IFC has received a copy of the authorization to the Auditors
referred to in Section 6.01(e) (AFFIRMATIVE COVENANTS);

        (n)  IFC has received a Certificate of Incumbency and Authority from
PriceSmart;

        (o)  the Co-Borrowers have delivered to IFC evidence, substantially in
the form of Schedule 4, of appointment of an agent for service of process
pursuant to Section 8.05(d) (APPLICABLE LAW AND JURISDICTION);

        (p)  the C Loan has been fully disbursed;

        (q)  the OPIC Loan shall have been disbursed pro rata with the A Loan;
and

        (r)  IFC shall have received a pay-off letter, in form and substance
acceptable to IFC, from each creditor of the Co-Borrowers as reasonably agreed
between the Co-Borrowers and IFC at the time of the first Disbursement.

        Section 5.02. CONDITIONS OF ALL DISBURSEMENTS. The obligation of IFC to
make any Disbursement, including the first Disbursement, is also subject to the
conditions that:

        (a)  no Event of Default and no Potential Event of Default has occurred
and is continuing;

        (b)  the proceeds of that Disbursement are, at the date of the relevant
request, needed by the Co-Borrowers for the purpose of the Project, or will be
needed for that purpose within three (3) months of that date;

        (c)  since the date of this Agreement nothing has occurred which has or
can reasonably be expected to have a Material Adverse Effect;

        (d)  since the date of this Agreement, the Co-Borrowers (taken as a
whole) have not incurred any material loss or liability (except such liabilities
as may be incurred in accordance with Section 6.02 (NEGATIVE COVENANTS ));

        (e)  the representations and warranties made in Article IV are true
and correct in all material respects on and as of the date of that
Disbursement with the same effect as if those representations and warranties
had been made on and as of the date of that Disbursement (but in the case of
Section 4.01(c) (REPRESENTATIONS AND WARRANTIES), without the words in
parentheses);

        (f)  the proceeds of that Disbursement are not in reimbursement of,
or to be used for, expenditures in the territories of any country which is
not a member of the World Bank or for goods produced in or services supplied
from any such country;

<PAGE>
                                      -32-

        (g)  IFC has received (if it so requires) a legal opinion or opinions in
form and substance satisfactory to IFC, of IFC's counsel in the relevant
Countries, and concurred in by counsel for the Co-Borrowers, with respect to any
matters relating to that Disbursement;

        (h)  after giving effect to that Disbursement, none of the Co-Borrowers
would be in violation of:

                (i)     its Charter;

                (ii)    any provision contained in any document to which such
                        Co-Borrower is a party (including this Agreement) or by
                        which such Co-Borrower is bound; or

                (iii)   any law, rule, regulation, Authorization or agreement or
                        other document binding on such Co-Borrower directly or
                        indirectly limiting or otherwise restricting its
                        borrowing power or authority or its ability to borrow;

        (i)  (without limiting the generality of Section 5.02(h)), after taking
into account the amount of that Disbursement and any other Long-term Debt
incurred by the Co-Borrowers and of any amounts of Shareholders' Equity paid
into the Co-Borrowers after the date of the latest financial statements of the
Co-Borrowers due pursuant to Section 6.03(a) (REPORTING REQUIREMENTS), (A) the
Consolidated Current Ratio would not be less than 1.2, (B) the Consolidated
Total Debt to Equity Ratio would not exceed 45:55, and (C) the Consolidated
Long-term Debt Service Coverage Ratio would not be less than 1.3, provided that,
with respect to any Disbursement requested to be made prior to the date of the
first financial statements due pursuant to Section 6.03(a) (REPORTING
REQUIREMENTS), the calculation of the Consolidated Current Ratio, Consolidated
Total Debt to Equity Ratio and the Consolidated Long-term Debt Service Coverage
Ratio shall be made on the basis of such information as IFC may reasonably
request, verified, if IFC so requires, by the Auditors; and

        (k)  the Co-Borrowers shall have deposited an amount equal to two
hundred thirty-four thousand three hundred seventy-five Dollars ($234,375) into
the Escrow Account for each one million Dollars ($1,000,000) disbursed.

        Section 5.03. CO-BORROWERS' CERTIFICATIONS. The Co-Borrowers shall
deliver to IFC with respect to each request for Disbursement:

        (a)  a certification, in the form included in Schedule 2, relating to
the conditions specified in Section 5.02 (CONDITIONS OF ALL DISBURSEMENTS)
(other than the condition in Section 5.02(g)) expressed to be effective as of
the date of that relevant Disbursement, and in the case of Section 5.02(d), also
certified by the Auditors if IFC so requires; and

        (b)  such evidence as IFC may reasonably request of the proposed
utilization of the proceeds of that Disbursement or the utilization of the
proceeds of any prior Disbursement.

<PAGE>
                                      -33-

        Section 5.04. CONDITIONS FOR IFC BENEFIT. The conditions in Section 5.01
through Section 5.03 are for the benefit of IFC and may be waived only by IFC in
its sole discretion.

                                   ARTICLE VI

                              PARTICULAR COVENANTS

        Section 6.01. AFFIRMATIVE COVENANTS. Unless IFC otherwise agrees, the
Co-Borrowers shall:

        (a)  carry out the Project and conduct its business with due diligence
and efficiency and in accordance with sound engineering, financial and business
practices;

        (b)  cause the financing specified in the Financial Plan to be applied
exclusively to the Project;

        (c)  maintain an accounting and control system, management information
system and books of account and other records, which together adequately reflect
truly and fairly the financial condition of the Co-Borrowers and the results of
their operations in conformity with the Accounting Principles;

        (d)  appoint and maintain at all times a firm of independent public
accountants acceptable to IFC as auditors of the Co-Borrowers;

        (e)  irrevocably authorize, in the form of Schedule 6, the Auditors
(whose fees and expenses shall be for the account of the Co-Borrowers) to
communicate directly with IFC at any time regarding the Co-Borrowers' accounts
and operations, and provide to IFC a copy of that authorization, and, no later
than thirty (30) days after any change in Auditors, issue a similar
authorization to the new Auditors and provide a copy thereof to IFC;

        (f)  upon IFC's request, such request to be made with reasonable prior
notice to the Co-Borrowers, except if an Event of Default or Potential Event of
Default is continuing or if special circumstances so require, permit
representatives of IFC, during normal office hours, to:

                (i)     visit the Project site and any of the premises where the
                        business of the Co-Borrowers is conducted;

                (ii)    inspect all facilities, plant and equipment comprised in
                        the Project;

                (iii)   have access to the Co-Borrowers' books of account and
                        records; and

<PAGE>
                                      -34-

                (iv)    have access to those employees and agents of each of the
                        Co-Borrowers who have or may have knowledge of matters
                        with respect to which IFC seeks information;

        (g)  design, construct, operate, maintain and monitor all of its sites,
plant, equipment and facilities:

                (i)     in accordance with the Environmental and Social
                        Policies, the Environmental, Health and Safety
                        Guidelines and the Life and Fire Safety Guidelines; and

                (ii)    in compliance with applicable environmental,
                        occupational health and safety requirements, and any
                        child labor and forced labor laws, rules and regulations
                        (including any international treaty obligations, if any)
                        of the Government of the Country and the local
                        authorities;

        (h)  no later than thirty (30) days after the date of this Agreement but
in any event prior to the date of the C Loan disbursement:

                (i)     provide IFC with all information necessary to enable IFC
                        to update the document dated August 21, 2000 (Project ID
                        No. 10296) entitled Environmental Review Summary ("ERS")
                        by incorporating any modification or addition to that
                        document relating to the Project; and

                (ii)    display the updated ERS in appropriate public places in
                        the Country acceptable to IFC for public access;

               and IFC shall be entitled to place a copy of that updated ERS in
               the World Bank public information center known as InfoShop for
               public access;

        (i)  obtain and maintain in force (and where appropriate, renew in a
timely manner) all Authorizations, including without limitation the
Authorizations specified in Annex A, which are necessary for the implementation
of the Project, the carrying out of the Co-Borrowers' businesses and operations
generally and the compliance by each of the Co-Borrowers with all its
obligations under the Transaction Documents and comply with all the conditions
and restrictions contained in, or imposed on the Co-Borrowers by, those
Authorizations;

        (j)  from time to time, execute, acknowledge and deliver or cause to be
executed, acknowledged and delivered such further instruments as may reasonably
be requested by IFC for perfecting or maintaining in full force and effect the
IFC Security or for re-registering the IFC Security or otherwise to enable each
of the Co-Borrowers to comply with its obligations under the Transaction
Documents; and

<PAGE>
                                      -35-

        (k)  install, to IFC's satisfaction, a wastewater treatment facility
prior to the opening of any new store in an area where local/municipal
facilities are not available or if required to do so by the government of the
relevant Country.

        Section 6.02. NEGATIVE COVENANTS . Unless IFC otherwise agrees, none of
the Co-Borrowers shall:

        (a)  declare or pay any dividend or make any distribution on its share
capital (other than dividends or distributions payable in shares of the
Co-Borrowers or dividends or distributions payable to the minority shareholders
of PSMT Trinidad), or purchase, redeem or otherwise acquire any shares of any of
the Co-Borrowers other than PriceSmart or any option over them unless the
proposed payment or distribution is out of retained earnings and the
Co-Borrowers, no earlier than sixty (60) days nor later than thirty (30) days
prior to doing so, certify to IFC in writing, in the form attached as Schedule
7, that:

                (i)     no Event of Default or Potential Event of Default has
                        occurred and is continuing; and

                (ii)    after giving effect to any such action:

                        (A)     the Consolidated Current Ratio will not be less
                                than 1.2;

                        (B)     the Consolidated Total Debt to Equity Ratio will
                                not be in excess of 50:50; and

                        (C)     the Consolidated Long-term Debt Service Coverage
                                Ratio will not be less than 1.3;

               provided always that:

                        (A)     the retained earnings out of which any of the
                                payments or distributions referred to in this
                                subsection may be made should in no event
                                include any amount resulting from the
                                revaluation of any of the Co-Borrowers' assets;

                        (B)     the Co-Borrowers shall not make any payments or
                                distributions of the type referred to in this
                                subsection if, after giving effect to it, the
                                Co-Borrowers could not certify the matters
                                referred to in Section 6.02(a)(i) and (ii); and

                        (C)     notwithstanding any limitation set forth in this
                                Section 6.02(a) or elsewhere in the Transaction
                                Documents, the Co-Borrowers shall at all times
                                be permitted to purchase, redeem or otherwise
                                acquire shares of any of their Subsidiaries
                                engaged in the same line of business as the
                                Co-Borrowers (including other Co-Borrowers) so

<PAGE>
                                      -36-

                                long as such activity is in furtherance of the
                                Co-Borrowers' consolidation of such
                                Subsidiaries;

        (b)  incur expenditures or commitments for expenditures for fixed or
other non-current assets, other than those required for carrying out the Project
or necessary for repairs, replacements and maintenance of satisfactory operating
conditions that are essential to the Co-Borrowers' businesses or operations,
unless, after giving effect to such expenditures or commitments for
expenditures, the Co-Borrowers will be in compliance with the ratios set forth
in Section 6.02(a) above in the preceding Financial Year;

        (c)  incur, assume or permit to exist any Total Debt except:

               (i)    the Loans;

               (ii)   other Total Debt specified in the Financial Plan;

               (iii)  additional Long-term Debt which would not result in the
                      Consolidated Long-term Debt to Equity Ratio exceeding
                      50:50 and the Consolidated Long-term Debt Service Coverage
                      Ratio exceeding 1.3;

               (iv)   Short-term Debt incurred in the ordinary course of
                      business which, when aggregated with contingent
                      liabilities arising from the discounting of trade
                      receivables, would not result at the time it is incurred
                      in the Consolidated Current Ratio falling below 1.2;

               (v)    additional Total Debt among any of the Co-Borrowers, but
                      only if and to the extent that such Total Debt is
                      subordinated in full, in payment and liquidation, to the A
                      Loan and the C Loan; and

               (vi)   Long-term Debt or Short-term Debt obtained to replace any
                      existing Long-term Debt or, as the case may be, any
                      Short-term Debt component of then outstanding Total Debt,
                      but then only to the extent that such new Total Debt is on
                      terms and conditions (as to interest rate, other costs and
                      tenor) at least as favorable to the Co-Borrowers as those
                      of the Total Debt being replaced;

        (d)  enter into any Capital Lease Obligations, except Capital Lease
Obligations with respect to which the aggregate capital lease payments of all
the Co-Borrowers do not exceed the equivalent of two million Dollars
($2,000,000) in any Financial Year ("Permitted Lease Amount") and only to the
extent that, when such Permitted Lease Amount is treated as Long-term Debt, the
Co-Borrowers' Consolidated Long-term Debt to Equity Ratio would not be in excess
of 50:50 and the Consolidated Long-term Debt Service Coverage Ratio would not be
less than 1.3;

<PAGE>
                                      -37-

        (e)  enter into any Derivative Transactions or assume the obligations of
any party to any Derivative Transaction; provided, however, that the foregoing
shall not apply to the following types of Derivative Transactions entered into
by the Co-Borrowers so long as the currency and the amounts associated with such
Derivative Transactions reasonably reflect the risk and/or exposure such
Derivative Transactions are designed to hedge:

               (i)    forward foreign exchange contracts (including
                      non-deliverable forward foreign exchange contracts);

               (ii)   currency swaps; and

               (iii)  interest-rate swaps;

        (f)  enter into any agreement or arrangement to guarantee or, in any way
or under any condition, assume or become obligated for all or any part of any
financial or other obligation of another Person, except guarantees by PriceSmart
in the ordinary course of business in favor of its Subsidiaries so long as after
any such guarantee the Co-Borrowers will be in compliance with the financial
ratios set forth in Section 6.02(a);

        (g)  create or permit to exist any Lien on any property, revenues or
other assets, present or future, of the Co-Borrowers, except for:

                (i)     the IFC Security;

                (ii)    any Liens securing other senior lenders under the
                        Financial Plan;

                (iii)   the naming of IFC as loss payee/beneficiary under all of
                        the Co-Borrowers' insurance policies;

                (iv)    any Lien arising from any tax, assessment or other
                        governmental charge or other Lien arising by operation
                        of law, in each case if the obligation underlying any
                        such Lien is not yet due or, if due, is being contested
                        in good faith by appropriate proceedings so long as:

                      (A)    those proceedings do not involve any substantial
                             danger of the sale, forfeiture or loss of any part
                             of the Project, title thereto or any interest
                             therein, nor interfere in any material respect with
                             the use or disposition thereof or the
                             implementation of the Project or the carrying on of
                             the businesses of the Co-Borrowers; and

                      (B)    the Co-Borrowers have set aside adequate reserves
                             sufficient to promptly pay in full any amounts that
                             the Co-Borrowers may be ordered to pay on final
                             determination of any such proceedings;

                (v)     the Liens set forth on Annex D;

<PAGE>
                                      -38-

                (vi)    Liens with respect to Total Debt permitted under Section
                        6.02(c) and Capital Lease Obligations permitted under
                        Section 6.02(d);

                (vii)   carriers', warehousemen's, mechanics', materialmen's,
                        repairmen's or other similar Liens arising in the
                        ordinary course of business;

                (viii)  Liens related to purchase money obligations incurred in
                        the ordinary course of business so long as such Liens
                        only attach to property related to such purchase money
                        obligations and secure only such property; and

                (ix)    easements, rights-of-way, restrictions and other similar
                        encumbrances incurred in the ordinary course of business
                        which do not materially interfere with the ordinary
                        conduct of the businesses of the Co-Borrowers conducted
                        thereon;

        (h)  enter into any transaction with any Person (including Affiliates of
the Co-Borrowers) except in the ordinary course of business on the basis of
arm's-length arrangements (including, without limitation, transactions whereby
the Co-Borrowers might pay more than the ordinary commercial price for any
purchase or might receive less than the full ex-works commercial price (subject
to normal trade discounts) for its products);

        (i)  establish any sole and exclusive purchasing or sales agency;

        (j)  enter into any partnership, profit-sharing or royalty agreement or
other similar arrangement whereby the Co-Borrowers' income or profits are, or
might be, shared with any other Person; provided, however, PriceSmart may enter
into such partnerships, profit-sharing or royalty agreements or other similar
arrangements in the ordinary course of business; provided, further, that in the
event of an Event of Default or Potential Event of Default, the amounts to be
potentially paid under any such partnership, profit-sharing or royalty agreement
or other similar arrangement may accrue but shall not be paid until the Event of
Default or Potential Event of Default is cured, and such amounts shall not be
paid but shall be deferred if after making any such payments, the Co-Borrowers
would not be in compliance with the financial ratios set forth in Section
6.02(a);

        (k)  enter into any management contract or similar arrangement whereby
its business or operations are managed by any other Person;

        (l) form or have any Subsidiary, except for:

                (i)     the Subsidiaries disclosed in the Letter of Information;

                (ii)    Subsidiaries formed for purposes of the Project; and

<PAGE>
                                      -39-

                (iii)   Subsidiaries formed by PriceSmart in similar lines of
                        business as the Co-Borrowers;

        (m)  make or permit to exist loans or advances to, or deposits (except
commercial bank deposits in the ordinary course of business) with, other Persons
or enterprise other than:

               (i)    short-term marketable securities acquired solely to give
                      temporary employment to the Co-Borrowers' idle funds;

               (ii)   advances or credit facilities in the ordinary course of
                      business for payment of rentals of real estate leases or
                      acquisition of real estate or working capital;

               (iii)  extentions of trade credit in the ordinary course of
                      busines;

               (iv)   advances to employees in the ordinary course of business
                      and in connection with management incentive plans; and

               (v)    investments permitted under Section 6.02(b) and other
                      investments that are not in excess of five per cent (5%)
                      of the Co-Borrowers' Consolidated assets;

        provided always that, that after taking into account such advances or
        credit facilities the Consolidated Current Ratio shall not fall below
        1.2;

        (n)  change its Charter in any manner which would be inconsistent with
the provisions of any Transaction Document;

        (o)  change its Financial Year;

        (p)  change the nature or scope of the Project or change the nature of
its present and/or contemplated business or operations;

        (q)  sell, transfer, lease or otherwise dispose of all or a substantial
part of its assets, other than inventory, whether in a single transaction or in
a series of transactions, related or otherwise other than (1) fixed assets of
the Co-Borrowers with an aggregate value of less than ten per cent (10%) of the
existing Net Fixed Assets in any Financial Year, and (2) assets that have become
worn out or obsolete and are replaced or upgraded or that are no longer required
for the purposes of carrying out the Project, in each case in the ordinary
course of business and in a manner consistent with the Transaction Documents;

        (r)  subject to those permitted under Section 6.02(a), undertake or
permit any merger, spin-off, consolidation or reorganization;

        (s)  terminate, amend or grant any waiver with respect to any
provision of:

<PAGE>
                                      -40-

        (i)  any of the agreements listed in Section 5.01(a) (CONDITIONS OF
FIRST Disbursement); or

                (ii)    any document evidencing or securing any other senior
                        loan set forth under the Financial Plan;

        (t)  prepay (whether voluntarily or involuntarily) or repurchase any
Long-term Debt (other than the Long-term Debt contemplated to be paid with the
proceeds of the A Loan and the OPIC Loan) pursuant to any provision of any
agreement or note with respect to that Long-term Debt unless:

                (i)     that Long-term Debt is refinanced using new Long-term
                        Debt on terms and conditions (as to interest rate, other
                        costs and tenor) at least as favorable to the
                        Co-Borrowers as those of the Long-term Debt being
                        refinanced; or

                (ii)    the Co-Borrowers give IFC at least thirty (30) days'
                        advance notice of their intention to make the proposed
                        prepayment and, if IFC so requires, the Co-Borrowers
                        contemporaneously prepay a proportion of the A Loan
                        equivalent to the proportion of the part of the
                        Long-term Debt being prepaid, such prepayment to be made
                        in accordance with the provisions of Section 3.06
                        (PREPAYMENT) except that there shall be no minimum
                        amount, prepayment premium or advance notice period for
                        that prepayment;

provided that, after taking into account such prepayment for refinancing, the
Consolidated Total Debt to Equity Ratio does not exceed 50:50 and the
Consolidated Current Ratio shall not be less than 1.2;

        (u)  use the proceeds of any Disbursement in the territories of any
country which is not a member of the World Bank or for reimbursements of
expenditures in those territories or for goods produced in or services supplied
from any such country;

        (v)  terminate, waive or materially amend any license agreements or
trademarks with respect to the Project;

        (w)  make (and shall not authorize or permit any Affiliate or any other
Person acting on its behalf to make) with respect to the Project or any
transaction contemplated by this Agreement, any Prohibited Payment. The
Co-Borrowers further covenant that should IFC notify any Co-Borrower of its
concerns that there has been a violation of the provisions of this Section or of
Section 4.01(p) of this Agreement, each of them shall cooperate in good faith
with IFC and its representatives in determining whether such a violation has
occurred, and shall respond promptly and in reasonable detail to any notice from
IFC, and shall furnish documentary support for such response upon IFC's request;

<PAGE>
                                      -41-

        (x)  allow the central office expenditures (before charge-backs) to
exceed nineteen million two hundred thousand Dollars ($19,200,000) or two and
one-half per cent (2.5%) of sales, whichever is greater, during the life of
the A Loan; or

        (y)  engage in any activities, including but not limited to those
related to future expansions and other improvements, which might directly or
indirectly result in the resettlement of individuals or businesses.

        Section 6.03. REPORTING REQUIREMENTS. Unless IFC otherwise agrees,
the Co-Borrowers shall:

        (a)  as soon as available but in any event within sixty (60) days
after the end of each quarter of each Financial Year, deliver to IFC:

                (i)     two (2) copies of their respective complete financial
                        statements for such quarter prepared, on an
                        unconsolidated basis and on a Consolidated Basis, in
                        accordance with the Accounting Principles;

                (ii)    during implementation of the Project, a report, in the
                        form attached as Schedule 8, on the progress in
                        implementation of the Project, including any factors
                        that have or could reasonably be expected to have a
                        Material Adverse Effect;

                (iii)   after the Project Financial Completion Date has
                        occurred, a report on any factors that have or could
                        reasonably be expected to have a Material Adverse
                        Effect; and

                (iv)    a statement of all material transactions during that
                        quarter between each Co-Borrower and each of its
                        Affiliates (other than any other Co-Borrower), if any,
                        and a certification by an Authorized Representative that
                        those transactions were on the basis of arm's-length
                        arrangements; at IFC's request, this statement shall be
                        certified by the Auditors;

        (b)  as soon as available but in any event within ninety (90) days after
the end of each Financial Year, deliver to IFC:

                (i)     two (2) copies of the complete and audited financial
                        statements for that Financial Year which are in
                        agreement with its books of account and prepared, on an
                        unconsolidated basis and Consolidated Basis, in
                        accordance with the Accounting Principles, together with
                        the Auditors' audit report on them, all in form
                        satisfactory to IFC;

                (ii)    a management letter and such other communication from
                        the Auditors commenting, with respect to that Financial
                        Year, on, among other things,

<PAGE>
                                      -42-

                        the adequacy of the Co-Borrowers' financial control
                        procedures, accounting systems and management
                        information system;

                (iii)   a report by the Auditors certifying that, on the basis
                        of its financial statements, each Co-Borrower was in
                        compliance with the covenants contained in Section 6.02
                        (NEGATIVE COVENANTS) as of the end of that Financial
                        Year or, as the case may be, detailing any
                        noncompliance;

                (iv)    a report by the Co-Borrowers on their operations during
                        that Financial Year, in the form of, and addressing the
                        topics listed in, Schedule 9; and

                (v)     a statement by the Co-Borrowers of all material
                        transactions between the Co-Borrowers and each of its
                        Affiliates (other than any other Co-Borrower), if any,
                        during that Financial Year, and a certification by an
                        Authorized Representative that those transactions were
                        on the basis of arm's-length arrangements;

        (c)  as soon as available but no later than sixty (60) days after the
end of the first six months of each Financial Year and after the end of each
Financial Year, provide to IFC a semi-annual report regarding Project
implementation, including a description of Cash Generation and the funds
raised from other sources of funds, invested in the Project;

        (d)  deliver to IFC, promptly following receipt, a copy of any
management letter or other communication sent by the Auditors (or any other
accountants retained by the Co-Borrowers) to the Co-Borrowers or their
management in relation to the Co-Borrowers' financial, accounting and other
systems, management or accounts, if not provided pursuant to Section
6.03(b)(ii);

        (e)  within ninety (90) days after the end of each Financial Year,
deliver to IFC an annual monitoring report in the form of Schedule 10 (which
form may be updated from time to time), confirming compliance with the
applicable national or local requirements, the Environmental and Social
Policies, the Environmental, Health and Safety Guidelines, and Section
6.01(g) and Section 6.01(h) or, as the case may be, detailing any
noncompliance together with (A) the action being taken to ensure compliance
and (B) a written report verifying the contents of that annual monitoring
report, prepared by an independent third party consultant of the
Co-Borrowers, acceptable to IFC;

        (f)  as soon as possible but no later than three (3) days after its
occurrence, notify IFC of any incident or accident which has or may
reasonably be expected to have a material adverse effect on the environment,
health or safety, including, without limitation, explosions, spills or
workplace accidents which result in death, serious or multiple injury or
major pollution, specifying, in each case, the nature of the incident or
accident, the on-site and off-site impacts arising or likely to arise
therefrom and the measures the Co-Borrowers are taking or plan to take to
address those impacts; and keep IFC informed of the on-going implementation
of those measures;

<PAGE>
                                      -43-

        (g)  give a fifteen (15) day prior notice to IFC of any Co-Borrower's
notification to its shareholders, of any meeting of its shareholders, such
notice to include the agenda of the meeting; and deliver to IFC two (2) copies
of:

                (i)     all notices, reports and other communications of the
                        Co-Borrowers to their respective shareholders, whether
                        any such communication has been made on an individual
                        basis or by way of publication in a newspaper or other
                        communication medium, as soon as available; and

                (ii)    the minutes of all shareholders' meetings within 30 days
                        of said shareholders' meeting;

        (h)  promptly notify IFC of any proposed change in the nature or scope
of the Project or the business or operations of the Co-Borrowers and of any
event or condition which has or may reasonably be expected to have a Material
Adverse Effect;

        (i)  promptly upon becoming aware of any litigation or administrative
proceedings before any Authority or arbitral body which has or may reasonably be
expected to have a Material Adverse Effect, notify IFC by facsimile of that
event specifying the nature of that litigation or those proceedings and the
steps the Co-Borrowers are taking or propose to take with respect thereto;

        (j)  promptly upon the occurrence of an Event of Default or Potential
Event of Default, notify IFC by facsimile specifying the nature of that Event of
Default or Potential Event of Default and any steps the Co-Borrowers are taking
to remedy it;

        (k)  provide to IFC, in a timely manner, the insurance certificates and
other information referred to in Section 6.04(d) (INSURANCE);

        (l)  promptly provide to IFC such other information as IFC from time to
time reasonably requests about each of the Co-Borrowers, their respective assets
and the Project; and

        (m)  with respect to the Project, within thirty (30) days after the end
of each Financial Year, provide a report by country with a confirmation that
land acquisition has occurred on a willing seller/willing buyer basis and
confirmation that no squatters and/or small merchants will be displaced, and if
displacement occurs a description of the relevant Co-Borrower's compensation
plan for all such Persons displaced.

<PAGE>
                                      -44-

        Section 6.04.  INSURANCE.

        (a) INSURANCE REQUIREMENTS AND CO-BORROWERS' UNDERTAKINGS. Unless IFC
otherwise agrees, each of the Co-Borrowers shall:

                (i)     insure and keep insured, with financially sound and
                        reputable insurers, all its assets and business against
                        all insurable losses to include the insurances specified
                        in Annex B and any insurance required by law;

                (ii)    punctually pay any premium, commission and any other
                        amounts necessary for effecting and maintaining in force
                        each insurance policy;

                (iii)   promptly notify the relevant insurer of any claim by the
                        Co-Borrower under any policy written by that insurer and
                        diligently pursue that claim;

                (iv)    comply with all warranties under each policy of
                        insurance;

                (vi)    not do or omit to do, or permit to be done or not done,
                        anything which might prejudice the Co-Borrower's, or,
                        where IFC is a loss payee or an additional named
                        insured, IFC's right to claim or recover under any
                        insurance policy; and

                (vii)   not vary, rescind, terminate, cancel or cause a material
                        change to insurance policy required to be maintained
                        under this Agreement unless the same is replaced by
                        other insurance satisfying the requirements of this
                        Section 6.04;

               provided always that if at any time and for any reason any
               coverage required to be maintained under this Agreement shall not
               be in full force and effect, then IFC shall thereupon or at any
               time while the same is continuing be entitled (but have no such
               obligation) on its own behalf to procure that insurance at the
               expense of the relevant Co-Borrower and to take all such steps to
               minimize hazard as IFC may consider expedient or necessary.

        (b)  POLICY PROVISIONS. Each insurance policy required to be obtained
pursuant to this Section shall be on terms and conditions acceptable to IFC, and
shall contain provisions to the effect that:

                (i)     no policy can expire nor can it be cancelled or
                        suspended by any Co-Borrower or the insurer for any
                        reason (including failure to renew the policy or to pay
                        the premium or any other amount) unless IFC and, in the
                        case of expiration or if cancellation or suspension is
                        initiated by the insurer, the relevant Co-Borrower
                        receives at least thirty (30) days' notice (or such
                        lesser period as IFC may agree with respect to
                        cancellation,

<PAGE>
                                      -45-

                        suspension or termination in the event of war and
                        kindred peril) prior to the effective date of
                        termination, cancellation or suspension;

                (ii)    IFC and all contractors working at the Project site are
                        named as additonal named insureds on all liability
                        policies;

                (iii)   where relevant, all applicable provisions (except those
                        relating to limits of liability) shall operate as if
                        they were a separate policy covering each insured party;
                        and

                (iv)    on every insurance policy on the Co-Borrower's assets
                        which are the subject of the IFC Security and for
                        business interruption, IFC is named as loss payee for
                        any claim of, or any series of claims arising with
                        respect to the same event whose aggregate amount is, the
                        equivalent of five hundred thousand Dollars ($500,000)
                        or more;

        (c)  APPLICATION OF PROCEEDS.

                (i)     IFC may remit the proceeds of any insurance paid to it
                        to the relevant Co-Borrower to repair or replace the
                        relevant damaged assets or if in the reasonable judgment
                        of IFC such insurable event creates a Material Adverse
                        Effect then, at IFC's discretion, IFC may apply those
                        proceeds towards any amount payable to IFC under this
                        Agreement, including to repay or prepay all or any part
                        of the A Loan in accordance with Section 3.07
                        (PREPAYMENT); provided that there shall be no minimum
                        amount or notice period or prepayment premium for any
                        such prepayment.

                (ii)    Each of the Co-Borrowers shall use any insurance
                        proceeds it receives (whether from IFC or directly from
                        the insurers) for loss of or damage to any asset solely
                        to replace or repair that asset.

        (d)  REPORTING REQUIREMENTS. Unless IFC otherwise agrees, each of the
Co-Borrowers shall provide to IFC the following:

                (i)     as soon as possible after its occurrence, notice of any
                        event which entitles the relevant Co-Borrower to claim
                        for an aggregate amount exceeding the equivalent of five
                        hundred thousand Dollars ($500,000) under any one or
                        more insurance policies;

                (ii)    within thirty (30) days after receipt of any insurance
                        policy issued to any Co-Borrower, a copy of that policy
                        incorporating any loss payee provisions required under
                        Section 6.04(b)(iv) (unless that policy has already been
                        provided to IFC pursuant to Section 5.01(i) (CONDITIONS
                        OF FIRST DISBURSEMENT));

<PAGE>
                                      -46-

                (iii)   not less than ten (10) days prior to the expiry date of
                        any insurance policy (or, for insurance with multiple
                        renewal dates, not less than ten (10) days prior to the
                        expiry date of the policy on the principal asset), a
                        certificate of renewal from the insurer, insurance
                        broker or agent confirming the renewal of that policy
                        and the renewal period, the premium, the amounts insured
                        for each asset or item and any changes in terms or
                        conditions from the policy's issue date or last renewal,
                        and confirmation from the insurer that provisions naming
                        IFC as loss payee or additional named insured, as
                        applicable remain in effect;

                (iv)    such evidence of premium payment as IFC may from time to
                        time reasonably request; and

                (v)     any other information or documents on each insurance
                        policy as IFC reasonably requests from time to time.

                                   ARTICLE VII

                                EVENTS OF DEFAULT

        Section 7.01. ACCELERATION AFTER DEFAULT. If any Event of Default occurs
and is continuing (whether it is voluntary or involuntary, or results from
operation of law or otherwise), IFC may, by notice to the Co-Borrowers, require
the Co-Borrowers to repay the A Loan or such part of the A Loan as is specified
in that notice. On receipt of any such notice, the Co-Borrowers shall
immediately repay the A Loan (or that part of the A Loan specified in that
notice) and pay all interest accrued on it, the prepayment premium specified in
Section 3.06 on the amount of the A Loan whose payment is accelerated and any
other amounts then payable under this Agreement. Each of the Co-Borrowers waives
any right it might have to further notice, presentment, demand or protest with
respect to that demand for immediate payment.

        Section 7.02.  EVENTS OF DEFAULT.  It shall be an Event of Default if:

        (a)  the Co-Borrowers fail to pay when due any part of the principal of,
or interest on, the A Loan and such failure continues for a period of five (5)
days;

        (b)  the Co-Borrowers fail to pay when due any part of the principal of,
or interest on, the OPIC Loan and such failure continues beyond any applicable
cure period;

        (c)  the Co-Borrowers fail to pay when due any part of the principal of,
or interest on, any loan from IFC to the Co-Borrowers other than the A Loan and
any such failure continues for the relevant period of grace provided for in the
agreement providing for that loan;

<PAGE>
                                      -47-

        (d)  any of the Co-Borrowers fails to comply with any of its obligations
under this Agreement or any other Transaction Document or any other agreement
between such Co-Borrower and IFC (other than for the payment of the principal
of, or interest on, the A Loan or any other loan from IFC to any of the
Co-Borrowers), and any such failure continues for a period of thirty (30) days
after the date on which IFC notifies the Co-Borrowers of that failure; provided
such 30-day cure period shall be extended up to an additional thirty (30) days
if the Co-Borrowers provide to IFC evidence, satisfactory to IFC, that they are
diligently proceeding in good faith to cure such failure;

        (e)  any party to a Transaction Document (other than IFC or the
Co-Borrowers) fails to observe or perform any of its obligations under that
Transaction Document, and any such failure continues for a period of thirty (30)
days after the date on which IFC notifies the Co-Borrowers of that failure;

        (f)  any representation or warranty made in Article IV or in connection
with the execution of, or any request (including a request for Disbursement)
under, this Agreement or any other Transaction Document is found to be incorrect
in any material respect;

        (g)  any Authority condemns, nationalizes, seizes, or otherwise
expropriates all or any substantial part of the property or other assets of the
Co-Borrowers or of their respective share capital, or assumes custody or control
of that property or other assets or of the businesses or operations of the
Co-Borrowers or of their respective share capital, or takes any action for the
dissolution or disestablishment of any Co-Borrower or any action that would
prevent any Co-Borrower or its officers from carrying on all or a substantial
part of its business or operations;

        (h)  a decree or order by a court is entered against any Co-Borrower:

                (i)     adjudging any such Co-Borrower bankrupt or insolvent;

                (ii)    approving as properly filed a petition seeking
                        reorganization, arrangement, adjustment or composition
                        of, or with respect to, such Co-Borrower under any
                        applicable law;

                (iii)   appointing a receiver, liquidator, assignee, trustee,
                        sequestrator (or other similar official) of such
                        Co-Borrower or of any substantial part of its property
                        or other assets; or

                (iv)    ordering the winding up or liquidation of its affairs;

or any petition is filed seeking any of the above and is not dismissed within
thirty (30) days;

        (i)    any Co-Borrower:

                (i)     requests a moratorium or suspension of payment of debts
                        from any court;

<PAGE>
                                      -48-

                (ii)    institutes proceedings or takes any form of corporate
                        action to be liquidated, adjudicated bankrupt or
                        insolvent;

                (iii)   consents to the institution of bankruptcy or insolvency
                        proceedings against it;

                (iv)    files a petition or answer or consent seeking
                        reorganization or relief under any applicable law, or
                        consents to the filing of any such petition or to the
                        appointment of a receiver, liquidator, assignee,
                        trustee, sequestrator (or other similar official) of
                        such Co-Borrower or of any substantial part of its
                        property;

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

                (vi)    admits in writing its inability to pay its debts
                        generally as they become due or otherwise becomes
                        insolvent;

        (j)  an attachment or analogous process is levied or enforced upon or
issued against any of the assets of any Co-Borrower for an amount in excess of
the equivalent of five hundred thousand Dollars ($500,000) and is not discharged
within thirty (30) days;

        (k)  any other event occurs which under any applicable law would have an
effect analogous to any of those events listed in Section 7.02(h) through
Section 7.02(j);

        (l)  any Co-Borrower fails to pay any of its Total Debt (other than the
A Loan or any other loan from IFC to such Co-Borrower) or to perform any of its
obligations under any agreement pursuant to which there is outstanding any Total
Debt, and any such failure continues for more than any applicable period of
grace or any such Total Debt becomes prematurely due and payable or is placed on
demand;

        (m)  any Authorization necessary for any Co-Borrower to perform and
observe its obligations under any Transaction Document, or to carry out the
Project, is not obtained when required or is rescinded, terminated, lapses or
otherwise ceases to be in full force and effect, including with respect to the
remittance to IFC or its assignees, in the Dollars, of any amounts payable under
any Transaction Document, and is not restored or reinstated within thirty (30)
days of notice by IFC to the Co-Borrowers requiring that restoration or
reinstatement;

        (n)    any Security Document or any of its provisions:

                (i)     is revoked, terminated or ceases to be in full force and
                        effect or ceases to provide the security intended,
                        without, in each case, the prior consent of IFC;

                (ii)    becomes unlawful or is declared void; or

<PAGE>
                                      -49-

                (iii)   is repudiated or its validity or enforceability is
                        challenged by any Person and any such repudiation or
                        challenge continues for a period of thirty (30) days
                        and, during which period such repudiation or challenge
                        has no effect;

        (o)  any Transaction Document (other than a Security Document) or any of
its provisions:

                (i)     is revoked, terminated or ceases to be in full force and
                        effect without, in each case, the prior consent of IFC,
                        and that event, if capable of being remedied, is not
                        remedied to the satisfaction of IFC within thirty (30)
                        days of IFC's notice to the Co-Borrowers; or

                (ii)    becomes unlawful or is declared void; or

        (p)  any Transaction Document (other than a Security Document) is
repudiated or the validity or enforceability of any of its provisions at any
time is challenged by any Person and such repudiation or challenge is not
withdrawn within thirty (30) days of IFC's notice to the Co-Borrowers requiring
that withdrawal; provided that no such notice shall be required or, as the case
may be, the notice period shall terminate if and when such repudiation or
challenge becomes effective.

        Section 7.03. BANKRUPTCY. If any Co-Borrower is liquidated or declared
bankrupt, the A Loan, all interest accrued on it and any other amounts payable
under this Agreement will become immediately due and payable without any
presentment, demand, protest or notice of any kind, all of which each
Co-Borrower waives.

                                  ARTICLE VIII

                                  MISCELLANEOUS

        Section 8.01. SAVING OF RIGHTS. (a) The rights and remedies of IFC in
relation to any misrepresentation or breach of warranty on the part of the
Co-Borrowers shall not be prejudiced by any investigation by or on behalf of IFC
into the affairs of the Co-Borrowers, by the execution or the performance of
this Agreement or by any other act or thing which may be done by or on behalf of
IFC in connection with this Agreement and which might, apart from this Section,
prejudice such rights or remedies.

        (b)  No course of dealing or waiver by IFC in connection with any
condition of Disbursement of the A Loan under this Agreement shall impair any
right, power or remedy of IFC with respect to any other condition of
Disbursement, or be construed to be a waiver thereof; nor shall the action of
IFC with respect to any Disbursement affect or impair any right, power or remedy
of IFC with respect to any other Disbursement.

<PAGE>
                                      -50-

        (c)  Unless otherwise notified to the Co-Borrowers by IFC and without
prejudice to the generality of Section 8.01(b), the right of IFC to require
compliance with any condition under this Agreement which may be waived by IFC
with respect to any Disbursement is expressly preserved for the purposes of any
subsequent Disbursement.

        (d)  No course of dealing and no failure or delay by IFC in exercising,
in whole or in part, any power, remedy, discretion, authority or other right
under this Agreement or any other agreement shall waive or impair, or be
construed to be a waiver of or an acquiescence in, such or any other power,
remedy, discretion, authority or right under this Agreement, or in any manner
preclude its additional or future exercise; nor shall the action of IFC with
respect to any default, or any acquiescence by it therein, affect or impair any
right, power or remedy of IFC with respect to any other default.

        Section 8.02. NOTICES. Any notice, request or other communication to be
given or made under this Agreement shall be in writing. Subject to Sections
6.03(i) and (h) (REPORTING REQUIREMENTS) and Section 8.05(f) (APPLICABLE LAW AND
JURISDICTION), any such communication may be delivered by hand, airmail,
facsimile or established courier service to the party's address specified below
or at such other address as such party notifies to the other party from time to
time, and will be effective upon receipt.

        For the Co-Borrowers:

               PriceSmart, Inc.
               4649 Morena Blvd.
               San Diego, CA 92117-3650

               Facsimile: (858) 581-4707

<PAGE>
                                      -51-

        For IFC:

               International Finance Corporation
               2121 Pennsylvania Avenue, N.W.
               Washington, D.C. 20433
               United States of America

               Facsimile: (202) 974-4390
                          (202) 974-4461

               Attention: Director, Latin America and Caribbean Department

               With a copy (in the case of communications relating to payments)
               sent to the attention of the Senior Manager, Financial Operations
               Unit, at:

               Facsimile: 202-974-4371.

        Section 8.03. ENGLISH LANGUAGE. (a) All documents to be provided or
communications to be given or made under this Agreement shall be in the English
language.

        (b)  To the extent that the original version of any document to be
provided, or communication to be given or made, to IFC under this Agreement or
any other Transaction Document is in a language other than English, that
document or communication shall be accompanied by an English translation
certified by an Authorized Representative to be a true and correct translation
of the original. IFC may, if it so requires, obtain an English translation of
any document or communication received in another language other than English at
the cost and expense of the Co-Borrowers. IFC may deem any such English
translation to be the governing version between the Co-Borrowers and IFC.

        Section 8.04. TERM OF AGREEMENT. This Agreement shall continue in force
until all monies payable under it have been fully paid in accordance with its
provisions.

        Section 8.05. APPLICABLE LAW AND JURISDICTION. (a) This Agreement is
governed by, and shall be construed in accordance with, the laws of the State of
New York, United States of America.

        (b)  Each Co-Borrower irrevocably agrees that any legal action, suit or
proceeding arising out of or relating to this Agreement or any other Transaction
Document to which it is a party may be brought by IFC in the courts of the
United States of America located in the Southern District of New York. By the
execution of this Agreement, each Co-Borrower irrevocably submits to the
non-exclusive jurisdiction of any such court in any such action, suit or
proceeding. Final judgment against the Co-Borrowers in any such action, suit or
proceeding shall be conclusive and may be enforced in any other jurisdiction,
including the Country, by suit on the

<PAGE>
                                      -52-

judgment, a certified or exemplified copy of which shall be conclusive evidence
of the judgment, or in any other manner provided by law.

        (c)  Nothing in this Agreement shall affect the right of IFC to commence
legal proceedings or otherwise sue the Co-Borrowers in the Country or any other
appropriate jurisdiction, or concurrently in more than one jurisdiction, or to
serve process, pleadings and other legal papers upon the Co-Borrowers in any
manner authorized by the laws of any such jurisdiction.

        (d)  Each Co-Borrower hereby irrevocably designates, appoints and
empowers CT Corporation System, 111 Eighth Avenue, 13th Floor, New York, NY
10011 as its authorized agent solely to receive for and on its behalf service of
summons or other legal process in any action, suit or proceeding IFC may bring
in the State of New York.

        (e)  As long as this Agreement or any other Transaction Document to
which the Co-Borrowers are a party remains in force, each Co-Borrower shall
maintain a duly appointed and authorized agent to receive for and on its behalf
service of any summons, complaint or other legal process in any action, suit or
proceeding IFC may bring in New York, New York, United States of America, with
respect to this Agreement or that other Transaction Document. Each Co-Borrower
shall keep IFC advised of the identity and location of such agent.

        (f)  Each Co-Borrower also irrevocably consents, if for any reason the
Co-Borrower's authorized agent for service of process of summons, complaint and
other legal process in any action, suit or proceeding is not present in New
York, New York, to the service of such papers being made out of those courts by
mailing copies of the papers by registered United States air mail, postage
prepaid, to the Co-Borrowers at their addresses specified pursuant to Section
8.02 (NOTICES). In such a case, IFC shall also send by facsimile, or have sent
by facsimile, a copy of the papers to the Co-Borrowers.

        (g)  Service in the manner provided in this Section 8.05 in any action,
suit or proceeding will be deemed personal service, will be accepted by the
Co-Borrowers as such and will be valid and binding upon the Co-Borrowers for all
purposes of any such action, suit or proceeding.

        (h)  Each Co-Borrower irrevocably waives to the fullest extent permitted
by applicable law:

                (i)     any objection which it may have now or in the future to
                        the laying of the venue of any action, suit or
                        proceeding in any court referred to in this Section; and

                (ii)    any claim that any such action, suit or proceeding has
                        been brought in an inconvenient forum.

<PAGE>
                                      -53-

        (i)  To the extent that any Co-Borrower may be entitled in any
jurisdiction to claim for itself or its assets immunity in respect of its
obligations under this Agreement or any other Transaction Document to which each
such Co-Borrower is a party from any suit, execution, attachment (whether
provisional or final, in aid of execution, before judgment or otherwise) or
other legal process or to the extent that in any jurisdiction that immunity
(whether or not claimed) may be attributed to it or its assets, each Co-Borrower
irrevocably agrees not to claim and irrevocably waives such immunity to the
fullest extent permitted now or in the future by the laws of such jurisdiction.

        (j)  Each Co-Borrower hereby acknowledges that IFC shall be entitled
under applicable law, including the provisions of the International
Organizations Immunities Act, to immunity from a trial by jury in any action,
suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby or any other Transaction Document to which each
such Co-Borrower is a party, brought against IFC in any court of the United
States of America. Each Co-Borrower hereby waives any and all rights to demand a
trial by jury in any action, suit or proceeding arising out of or relating to
this Agreement or any other Transaction Document to which each such Co-Borrower
is a party or the transactions contemplated by this Agreement or those
Transaction Documents, brought against IFC in any forum in which IFC is not
entitled to immunity from a trial by jury.

        (k)  To the extent that any Co-Borrower may, in any suit, action or
proceeding brought in any of the courts referred to in Section 8.05(b) or a
court of the Country or elsewhere arising out of or in connection with this
Agreement or any other Transaction Document to which each such Co-Borrower is a
party, be entitled to the benefit of any provision of law requiring IFC in such
suit, action or proceeding to post security for the costs of such Co-Borrower,
or to post a bond or to take similar action, each Co-Borrower hereby irrevocably
waives such benefit, in each case to the fullest extent now or in the future
permitted under the laws of the Country or, as the case may be, the jurisdiction
in which such court is located.

        Section 8.06. DISCLOSURE OF INFORMATION. (a) IFC may disclose any
documents or records of, or information about, this Agreement or any other
Transaction Document, or the assets, business or affairs of the Co-Borrowers to:

                (i)     its outside counsel, auditors and rating agencies; and

                (ii)    any other Person as IFC may deem appropriate in
                        connection with any proposed sale, transfer, assignment
                        or other disposition of IFC's rights under this
                        Agreement or any Transaction Document or otherwise for
                        the purpose of exercising any power, remedy, right,
                        authority, or discretion relevant to this Agreement or
                        any other Transaction Document.

        (b)  Each Co-Borrower acknowledges and agrees that, notwithstanding the
terms of any other agreement between such Co-Borrower and IFC, a disclosure of
information by IFC in the circumstances contemplated by Section 8.06(a) does not
violate any duty owed to the Co-Borrowers under this Agreement or under any such
other agreement.

<PAGE>
                                      -54-

        Section 8.07. SUCCESSORS AND ASSIGNEES. This Agreement binds and
benefits the respective successors and assignees of the parties. However, the
Co-Borrowers may not assign or delegate any of their rights or obligations under
this Agreement without the prior consent of IFC.

        Section 8.08. JOINT AND SEVERAL LIABILITY. The liability of the
Co-Borrowers under this Agreement shall be joint and several.

        Section 8.09. AMENDMENTS, WAIVERS AND CONSENTS. Any amendment or waiver
of, or any consent given under, any provision of this Agreement shall be in
writing and, in the case of an amendment, signed by the parties.

        Section 8.10 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which is an original, but all of which together constitute
one and the same agreement.

        IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
in their respective names as of the date first above written.

                           PRICESMART INC.

                           By: /s/ Gilbert A. Partida
                           Name: Gilbert A. Partida
                           Title: President/CEO

                           PSMT CARIBE INC.

                           By: /s/ Allan C. Youngberg
                           Name:  Allan C. Youngberg
                           Title: Treasurer/Chief Financial Officer

                           PSMT TRINIDAD/TOBAGO LTD.

                           By:    /s/ Joseph Eseau
                           Name:  Joseph Eseau
                           Title: Chairman

<PAGE>
                                      -55-

                           INTERNATIONAL FINANCE CORPORATION

                           By: /s/ Mary Ellen Iskenderian
                           Name: Mary Ellen Iskenderian
                           Title: Manager Latin America and Caribbean Department

<PAGE>
                                      -56-

                           [Intentionally left blank]

<PAGE>

                                      -57-

                                     ANNEX A

                                                                     Page 1 of 3

                         BORROWER/PROJECT AUTHORIZATIONS

            (See Sections 4.01(d) and 5.01(e) of the Loan Agreement)

        Section (1).  AUTHORIZATIONS ALREADY OBTAINED

               (a)    _______________

               (b)    _______________

               (c)    _______________

        Section (2).  AUTHORIZATIONS TO BE OBTAINED PRIOR TO FIRST DISBURSEMENT

               (d)    _______________

               (e)    _______________

               (f)    _______________

               (g)    _______________

               (h)    _______________

               (i)    _______________

        [Section (3). AUTHORIZATIONS TO BE OBTAINED NO LATER THAN [INSERT DATE]

               (j)    _______________

               (k)    _______________

               (l)    _______________

               (m)    _______________

<PAGE>

                                      -58-

<PAGE>

                                      -59-

                                                                         ANNEX B
                                                                     Page 1 of 1

                             INSURANCE REQUIREMENTS

                   (See Section 6.04(a) of the Loan Agreement)

Section (1).   CONSTRUCTION PHASE

    (a)     Construction All Risks, based on full contract value and including:

            (i)     Riot and Strike

            (ii)    Debris Removal

            (iii)   Extra Expenses

            (iv)    Maintenance

            (v)     Third Party Liability

    (b)     Advance Loss of Profits

Section (2). OPERATIONAL PHASE

    (a)     Fire and named perils or All Risks, based on replacement
            cost of assets

    (b)     Business Interruption

    (c)     Third Party Liability

Section (3).   AT ALL TIMES

        Such insurances as required by local legislation.

<PAGE>
                                      -60-

                                                                         ANNEX C
                                                                     Page 1 of 2

              ASSETS OF THE CO-BORROWERS TO BE GRANTED AS SECURITY

COSTA RICA:

1.      Immovable Assets and Equipment:

        PriceSmart Escazu                                 Land
        Autopista Prospero Fernandez                      Building
        Del Peaje 200mts. oeste mano izquierda            FF&E
        Escazu, Costa Rica, C.A.

2.      Movable Assets:                                   Inventory

EL SALVADOR:

1.      Immovable Assets and Equipment:

        PriceSmart Los Heroes                             Land
        Urbanizaci--n Siglo XXI, Blvd.                    Building
        Tutunichapa No. 1                                 FF&E
        San Salvador

2.   Movable Assets:                                      Inventory

HONDURAS:

1.      Immovable Assets and Equipment:
        PriceSmart Tegucigalpa                            FF&E
        Colonia Florencia
        Entre Ferreteria Rene J. Handal #3
        Y Multi Plaza Mall
        Tegucigalpa, Honduras, C.A.

2.      Movable Assets:                                   Inventory

<PAGE>
                                      -61-

                                                                         ANNEX C
                                                                     Page 2 of 2

DOMINICAN REPUBLIC:

1.      Immovable Assets and Equipment:
        PriceSmart Dominicana S.A.                        Land
        Av. Charles Summer 54                             Building
        Santo Domingo, Rep. Dominicana                    FF&E

        PriceSmart EastSide.                              Land
        Carretera Mella No. 43                            Building
        Km. 91/2 Urb. Dona                                FF&E
        Idalia II, Santo Domingo, R.D.

2.      Movable Assets:                                   Inventory

TRINIDAD

Port of Spain Site.

1.      Immovable Assets and Equipment                    Building

2.      Movable Assets:                                   FF&E

<PAGE>

                                      -62-

                                                                         ANNEX D
                                                                     Page 1 of 2

          PRICESMART, INC, PSMT CARIBE, INC & PSMT TRINIDAD/TOBAGO LTD.
                                  LIST OF LIENS

<TABLE>
<CAPTION>
PROPERTY ADDRESS                        LIEN HOLDER                    AMOUNT     EXPIRY
                                                                       (000's)
<S>                                     <C>                            <C>        <C>
COSTA RICA
PriceSmart Zapote                       Citibank SA. Costa Rica.
PriceSmart Costa Rica, SA               Land, building and ff&e        $5,254      10/04
Frente al Registro Nacional
Zapote, San Jose, Costa Rica

PriceSmart Escazu                       Banex SA. Costa Rica
Autopista Prospero Fernandez            Land, building and ff&e        $5,900      05/06
Del Peaje 200mts.
oeste mano izquierda
Escazu, Costa Rica, C.A.

PriceSmart Heredia                      Banco Cuscatlan, SA.
Carretera Hacia Heredia                 Costa Rica
De Atlas Electrica 300mts,              Land, building and ff&e        $3,760      06/05
norte mano derecha
San Pablo de Heredia,
Costa Rica, C.A.

EL SALVADOR
PriceSmart Santa Elena                  Citibank NA,
Ubicacion Madre Selva                   San Salvador.
Blvd. Santa Elena Sur                   Land, building and ff&e        $4,562      12/04
Calle Cortez Blanco y
Avenida El Pepeto
Antiguo Cuscatlan, La Libertad
</TABLE>

<PAGE>
                                      -63-

                                                                         ANNEX D
                                                                     Page 2 of 2

<TABLE>
<CAPTION>
PROPERTY ADDRESS                        LIEN HOLDER                    AMOUNT     EXPIRY
                                                                       (000's)
<S>                                     <C>                            <C>        <C>
HONDURAS
PriceSmart San Pedro Sula               Citibank SA. Honduras.
Centro Comercial Mega Plaza,            Banco Del Pais SA.
Edifico Blanco de Londres               Honduras.
3er y 4ato piso
Boulevard Salida a La Lima, Cortes      Land, building and ff&e        $3,360      02/05
San Pedro Sula, Honduras

PriceSmart Tegucigalpa                  Banco Ficohsa.
Colonia Florencia                       Honduras
Entre Ferreteria Rene J. Handal #3      Inventory                      $2,500      06/01
Y Multi Plaza Mall
Tegucigalpa, Honduras, C.A.

DOMINICAN REPUBLIC

PriceSmart Santo Domingo                Banco Del Progresso, SA.
PriceSmart Dominicana S.A.              Dominican Republic.
Av. Charles Summer 54                   Land, building, ff&e and       $7,000      03/01
Santo Domingo,                          inventory                      $2,000      06/01
Rep. Dominicana

Bancredito, SA.
PriceSmart Dominicana S.A.              Dominican Republic.
Estrella Sadhala 22                     Land, building, ff&e and       $3,780      02/05
Santiago de los Caballeros,             inventory                      $2,000      07/01
Rep. Dominicana

TRINIDAD

Chaguanas                               Royal Bank of Trinidad
Off Endevour Flyover                    and Tobago. Trinidad.
Chaguanas,                              Land, building, ff&e and       $6,000      06/07
Trinidad, W.I.                          inventory
</TABLE>

<PAGE>
                                      -64-

                                                                      SCHEDULE 1
                                                                     Page 1 of 2

                 FORM OF CERTIFICATE OF INCUMBENCY AND AUTHORITY

          (See Section 1.01 and Section 5.01(m) of the Loan Agreement)

                             [Borrower's Letterhead]

                                                                         [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
United States of America

Attention:  Director, Latin America and Caribbean Department

Ladies and Gentlemen:

                     CERTIFICATE OF INCUMBENCY AND AUTHORITY

        With reference to the Loan Agreement among PriceSmart Inc., PSMT Caribe
Inc. and PSMT Trinidad/Tobago Limited, dated as of January 26, 2001 (the "Loan
Agreement"), I, the undersigned [Chairman/Director] of PriceSmart Inc., duly
authorized to do so, hereby certify that the following are the names, offices
and true specimen signatures of the persons [each] [any two] of whom are, and
will continue to be, authorized:

        (a)  to sign on behalf of the Co-Borrowers the requests for the
disbursement of funds provided for in Section 3.02 of the Loan Agreement

        (b)  to sign the certifications provided for in Section 5.02 and Section
5.03 of the Loan Agreement; and

<PAGE>
                                      -65-

                                                                      SCHEDULE 1
                                                                     Page 2 of 2

        (c)  to take any other action required or permitted to be taken, done,
signed or executed under the Loan Agreement or any other agreement to which IFC
and the Co-Borrowers may be parties.

<TABLE>
<CAPTION>
*NAME                        OFFICE                       SPECIMEN SIGNATURE
  <S>                        <C>                          <C>
  ---------------------      ----------------------       ----------------
  ---------------------      ----------------------       ----------------
  ---------------------      ----------------------       ----------------
</TABLE>

        You may assume that any such person continues to be so authorized until
you receive authorized written notice from PriceSmart Inc. that they, or any of
them, is no longer so authorized.

                                            Yours truly,

                                            PRICESMART INC.

                                            By ________________________
                                                 [Chairman/Director]

----------
* Designations may be changed by the Borrower at any time by issuing a new
  Certificate of Incumbency and Authority authorized by the Board of Directors
  of the Borrower where applicable.

<PAGE>
                                      -66-

                                                                      SCHEDULE 2
                                                                     Page 1 of 4

                    FORM OF REQUEST FOR DISBURSEMENT (A LOAN)

            (See Section 3.02 and Section 5.03 of the Loan Agreement)

                             [Borrower's Letterhead]

                                                                         [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
United States of America

Attention: Director, Latin America and Caribbean Department

Ladies and Gentlemen:

                              Investment No. 10296

                    REQUEST FOR A LOAN DISBURSEMENT NO. [ ]*

1. Please refer to the Loan Agreement (the "Loan Agreement") dated as of January
26, 2001, among PriceSmart Inc., PSMT Caribe Inc. and PSMT Trinidad/Tobago
Limited (the "Co-Borrowers") and International Finance Corporation ("IFC").
Terms defined in the Loan Agreement have their defined meanings whenever used in
this request. PSMT Caribe Inc. and PSMT Trinidad Tobago Limited each have
[nominated] [appointed] PriceSmart Inc. ("PriceSmart") as its agent for purposes
of executing and delivering this Disbursement Request and the related
Disbursement Receipt on behalf of the Co-Borrowers.

[2. PriceSmart irrevocably request the disbursement on ____________, 200_ (or as
soon as practicable thereafter) of the amount of ____________ Dollars
($____________) under the A Loan (the "Disbursement") in accordance with the
provisions of Section 3.02 of the Loan Agreement. You are requested to pay such
amount to the account in New York of PriceSmart Inc., [Name of correspondent
Bank], Account No. ____________ at [Name and Address of Bank] for further credit
to Co-Borrowers as follows:

-----------------------------------
* Each to be numbered in series.

<PAGE>
                                      -67-

                                                                      SCHEDULE 2
                                                                     Page 2 of 4

     (a)  $__________ to Account No. ___________ of PSMT Caribe Ltd. at [Name
          and Address of Bank] in the British Virgin Islands; and

     (b)  $__________ to Account No. ____________ of PSMT Trinidad/Tobago
          Limited at [Name and Address of Bank] in [City], Trinidad and
          Tobago.(1)

[2. PriceSmart irrevocably request the disbursement on ____________, 200_ (or as
soon as practicable thereafter) of the amount of ____________ Dollars
($____________) under the A Loan (the "Disbursement") in accordance with the
provisions of Section 3.02 of the Loan Agreement. You are requested to pay such
amount to the account in New York of [CREDITOR], [Name of correspondent Bank],
Account No. ____________ at [Name and Address of Bank] .]

3.   There is enclosed a signed but undated receipt for the amount of the
Disbursement. The Co-Borrowers authorize IFC to date such receipt with the date
of actual disbursement by IFC.

4.   For the purpose of Section 5.02 and Section 5.03 of the Loan Agreement,
PriceSmart, as agent for each of the other Co-Borrowers, certifies as follows:

        (a) PriceSmart has been appointed as agent for each of the Co-Borrowers
(other than PriceSmart) for purposes of making, on behalf of each such
Co-Borrower, the certifications set forth herein;

        (b) no Event of Default and no Potential Event of Default has occurred
and is continuing;

        (c) the proceeds of the Disbursement are at the date of this request
needed by the Co-Borrowers for the purpose of the Project, or will be needed for
such purpose within three (3) months of such date;

----------------------------------
(1) Any exchange control consents, if required (e.g. for IFC to remit to
    overseas account), must be provided by the Co-Borrowers to IFC prior to
    disbursement.

<PAGE>
                                      -68-

                                                                      SCHEDULE 2
                                                                     Page 3 of 4

        (d)  since the date of the Loan Agreement nothing has occurred which has
or could reasonably be expected to have a Material Adverse Effect;

        (e)  since [insert date] [the date of the Loan Agreement]** none of the
Co-Borrowers has incurred any material loss or liability (except such
liabilities as may be incurred by the Co-Borrowers in accordance with Section
6.02 of the Loan Agreement);

        (f)  the representations and warranties made in Article IV of the Loan
Agreement are true on the date of this request and will be true on the date of
Disbursement with the same effect as if such representations and warranties had
been made on and as of each such date (but in the case of Section 4.01(c),
without the words in parenthesis);

        (g)  the proceeds of the Disbursement are not in reimbursement of, or to
be used for, expenditures in the territories of any country which is not a
member of the World Bank or for goods produced in or services supplied from any
such country;

        (h)  after giving effect to the Disbursement, none of the Co-Borrowers
will be in violation of:

                (i)     its Charter;

                (ii)    any provision contained in any document to which it is a
                        party (including the Loan Agreement) or by which it is
                        bound; or

                (iii)   any law, rule, regulation, Authorization or agreement or
                        other document binding on it directly or indirectly,
                        limiting or otherwise restricting its borrowing power or
                        authority or its ability to borrow; and

----------------------------
** The date should be the same as is used in Section 4.01 (h)(i). Use the
   second formulation if the Borrower is a start-up company which did not
   deliver meaningful financial statements prior to the date of the Loan
   Agreement.

<PAGE>
                                      -69-

                                                                      SCHEDULE 2
                                                                     Page 4 of 4

                (iv)    since [insert the dates of the latest version of the
                        respective Charters] no amendment has been made to the
                        Charters of any of the Co-Borrowers [.] [, except for:
                        (list all amendments).]

        The above certifications are effective as of the date of this Request
for Disbursement and shall continue to be effective as of the date of the
Disbursement. If any of these certifications is no longer valid as of or prior
to the date of the requested Disbursement, the Co-Borrowers undertake to
immediately notify IFC.

                                            Yours truly,

                                            PRICESMART INC.

                                            By ________________________
                                               Authorized Representative

Copy to: Manager, Financial Operations Unit
         International Finance Corporation

<PAGE>
                                      -70-

                                                                      SCHEDULE 3
                                                                     Page 1 of 1

                        FORM OF LOAN DISBURSEMENT RECEIPT

                    (See Section 3.02 of the Loan Agreement)

                             [Borrower's Letterhead]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
United States of America

Attention: Manager, Financial Operations Unit

Ladies and Gentlemen:

                              Investment No. 10296

                     DISBURSEMENT RECEIPT NO. [ ]* (A LOAN)

        We, PriceSmart Inc., hereby acknowledge on behalf of PriceSmart Inc.,
PSMT Caribe Inc. and PSMT Trinidad/Tobago Limited ("the Co-Borrowers"), receipt
on the date hereof, of the sum of _________________ Dollars ($_________)
disbursed to us by International Finance Corporation ("IFC") under the A Loan in
the amount of twenty-two million Dollars ($22,000,000) provided for in the Loan
Agreement dated as of January 26, 2001 among the Co-Borrowers and International
Finance Corporation.

                                            Yours truly,

                                            PRICESMART INC.

                                            By ____________________________
                                               Authorized Representative***

--------------------------
*   To correspond with number of the Disbursement request. See Schedule 2.

*** As named in the Borrower's Certificate of Incumbency and Authority (see
    Schedule I).

<PAGE>
                                      -71-

                                                                      SCHEDULE 4
                                                                     Page 1 of 2

                        FORM OF SERVICE OF PROCESS LETTER
                  [Letterhead of Agent for Service of Process]
                   (See Section 5.01(n) of the Loan Agreement)

                                                                         [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C.  20433
Attention:  Director, Latin America and Caribbean Department

               Re:    [Country/_________]

Dear Sirs:

        Reference is made to Section 8.05 of the Loan Agreement dated as of
January 26, 2001 (the "LOAN AGREEMENT") and Section 2.10 of the C Loan
Agreement, among PriceSmart, Inc., PSMT Caribe Inc. and PSMT Trinidad/Tobago
Limited (collectively, the "CO-BORROWERS") and International Finance Corporation
("IFC"). Unless otherwise defined herein, capitalized terms used herein shall
have the meaning specified in the Loan Agreement.

        Pursuant to Section 8.05(d) of the Loan Agreement, each of the
Co-Borrowers has irrevocably designated and appointed the undersigned, CT
Corporation System, with offices currently located at 111 Eighth Avenue, 13th
Floor, New York, New York 10011, as its authorized agent to receive for and on
its behalf service of process in any legal action or proceeding with respect to
the Loan Agreement and the other Transaction Documents to which it is a party in
the courts of the United States of America for the Southern District of New
York.

        The undersigned hereby informs you that it has irrevocably accepted that
appointment as process agent as set forth in Section 8.05(d) of the Loan
Agreement from January 26, 2001 until September 15, 2010 and agrees with you
that the undersigned (i) shall inform IFC promptly in writing of any change of
its address in New York, (ii) shall perform its obligations as such process
agent in accordance with the relevant provisions of Section 8.05 of the Loan
Agreement, and (iii) shall forward promptly to the Co-Borrowers any legal
process received by the undersigned in its capacity as process agent.

<PAGE>
                                      -72-

                                                                      SCHEDULE 4
                                                                     Page 2 of 2

        As process agent, the undersigned and its successor or successors agree
to discharge the above-mentioned obligations and will not refuse fulfillment of
such obligations as provided under Section 8.05 of the Loan Agreement.

                                            Very truly yours,

                                            [CT Corporation System]

                                            By:    ____________________
                                            Title:

cc: PriceSmart Inc.
    PSMT Caribe Inc.
    PSMT Trinidad Tobago Limited

<PAGE>
                                      -73-

                                                                   SCHEDULE 5(A)
                                                                     Page 1 of 6

                     FORM OF LOCAL COUNSEL'S LEGAL OPINION(2)

                   (See Section 5.01(e) of the Loan Agreement)

                                                                 [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
U.S.A.

                              RE: PRICESMART, INC.

Dear Sirs,

We have acted as legal counsel to International Finance Corporation ("IFC") in
connection with (i) the loan to PriceSmart, Inc. ("PriceSmart"), PSMT Caribe,
Inc. ("PSMT Caribe") and PSMT Trinidad/Tobago Limited ("PSMT Trinidad" and,
collectively with PriceSmart and PSMT Caribe, the "Co-Borrowers"), as joint and
several borrowers, in the principal amount of twenty-two million Dollars
($22,000,000) pursuant to the Loan Agreement dated January 26, 2001 (the "IFC A
Loan Agreement") by and among the Co-Borrowers and IFC, and (ii) the loan to the
Co-Borrowers jointly and severally in the principal amount of ten million
Dollars ($10,000,000) pursuant to the IFC C Loan Agreement dated January 26,
2001 (the "IFC C Loan Agreement") by and among the Co-Borrowers and IFC. Unless
otherwise defined herein, capitalized terms used herein shall have the meaning
set forth in the IFC A Loan Agreement.

This opinion is furnished to you pursuant to Section 5.01(e) of the IFC A Loan
Agreement.

In connection with the opinion set out below, we have examined the following
documents:

        1.  the IFC A Loan Agreement;

        2.  the IFC C Loan Agreement;

------------------------
(2) FORM OF LEGAL OPINION FROM LOCAL COUNSEL IN TRINIDAD & TOBAGO AND BRITISH
    VIRGIN ISLANDS.

<PAGE>
                                      -74-

                                                                   SCHEDULE 5(A)
                                                                     Page 2 of 6

        3.  the Share Retention Agreement;

        4.  the Pledge of Shares Agreement, dated January 26, 2001, by and
            among PriceSmart, [PSMT Caribe][PSMT Trinidad] and IFC (the
            "Share Pledge Agreement");

        5.  the asset pledge agreement(3), dated __________ (the "Asset Pledge
            Agreement"), among _______________ and IFC;

        6.  the mortgage agreement(4) dated __________________ (the "Mortgage
            Agreement"), among ______________ and IFC;

        7.  a certified copy of the minutes of the extraordinary general
            meeting of ____________________held on ________, ________,
            ________, and ________, respectively;

        8.  a certificate of ______, dated ________, and ___________,
            respectively, evidencing the registration of the Security
            Agreements (as defined below);

        9.  [insert relevant corporate documents]; and

       10.  such other documents as we have considered relevant for the
            purposes of issuing this opinion.

The Asset Pledge Agreement, the Mortgage Agreement, and the Share Pledge
Agreement, are hereinafter referred to collectively as the "Security
Agreements"; the IFC A Loan Agreement, the IFC C Loan Agreement, and the Share
Retention Agreement, and the Security Agreements are hereinafter referred to
individually as a "Document" and collectively referred to as the "Documents".

In connection with this opinion, we have examined the originals, or certified,
conformed or reproduction copies, of all records, agreements, instruments and
documents as we have deemed relevant or necessary as the basis for the opinions
hereinafter expressed. In stating our opinion, we have assumed (i) the
genuineness of all signatures on original or certified copies of all copies
submitted to us as certified or reproduction copies, and (ii) that each of the
Documents (other than the Security Agreements) are legal, valid, binding and
enforceable under the laws of the State of New York, United States of America.

Based upon the foregoing and subject to the qualifications and limitations set
forth herein, we are of the opinion that:

----------------------------
(3) This refers to the agreement evidencing the first ranking pledge of
    movable assets in favor of IFC.
(4) This refers to the agreement evidencing the first ranking mortgage over
    all the fixed assets in favor of IFC.

<PAGE>
                                      -75-

                                                                   SCHEDULE 5(A)
                                                                     Page 3 of 6

1.      [PSMT Trinidad][PSMT Caribe] (the "Company") is a company duly organized
and existing under the laws [Trinidad & Tobago][British Virgin Islands] and has
full power and authority required by law to conduct its business in which it is
engaged.

2.      The Articles of Association of the Company are in full compliance with
the laws and regulations of [Trinidad & Tobago][British Virgin Islands] and have
not been amended since _______________;

3.      The Company has a share capital in the amount of __________ (        ),
divided into __________ shares of ________ par value each, which share
capital is duly subscribed and entirely paid-in; to the best of our knowledge
and on the basis of our review of the Company's [shareholders ledger], each
of PriceSmart and [NAME OF MINORITY SHAREHOLDER] owns _________% and ___%,
respectively, of the shares and voting rights constituting the share capital
of the Company.

4.      The Company has full power and authority to enter into and perform its
obligations under each of the Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents.

5.      The Company has duly executed and delivered each of the Documents to
which it is a party and each of such Documents constitutes its legal, valid and
binding obligations enforceable in accordance with its terms.

6.      The execution, delivery and performance by the Company of any Document
to which it is a party will not violate (i) its Articles of Association or (ii)
any provisions of the laws of [Trinidad & Tobago][British Virgin Islands], or
(iii) to the best of my knowledge, after due inquiry, contravene or result in a
breach of, or constitute a default under, any mortgage, conditional sales
contract, bank loan, credit agreement or any other agreement or instrument to
which the Company is a party or by which the Company or any of its properties
may be bound.

7.      Except as provided in Paragraph 8 below and except for licenses, permits
and consents which are of a routine nature and which are customarily granted in
due course after application, all governmental, corporate, creditors',
shareholders' and other necessary licenses, approvals and consents have been
obtained for:

        7.1     the financing by IFC under the IFC A Loan Agreement and the IFC
                C Loan Agreement;

        7.2     the carrying on of the business of the Company as it is
                presently carried on and is contemplated to be carried on;

<PAGE>
                                      -76-

                                                                   SCHEDULE 5(A)
                                                                     Page 4 of 6

        7.3     the due execution and delivery of, and the performance under,
                the Documents and any documents necessary or desirable in their
                implementation; and

        7.4     the remittance to IFC in Dollars of all monies payable in
                respect of any of the Documents, the security created by the
                Security Agreements.

8.      The Security Agreements have been duly executed and delivered in
accordance with the laws of [Trinidad & Tobago][British Virgin Islands] and
confer a first ranking perfected security interest over the assets described
therein in favor of IFC; such Security Agreements have become unconditionally
and fully effective and do not violate or exceed the corporate purpose of the
Company, or contravene any provision of any applicable law or regulation
binding on the parties thereo.

9.      Under the laws of [Trinidad & Tobago][British Virgin Islands],
neither the Company nor its property has any immunity from jurisdiction of
any court or from set-off or any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution or
otherwise).

10.     To the best of our knowledge after due inquiry, no litigation,
investigation or proceeding of or before any Authority is pending against the
Company or its properties or revenue.

11.     The choice of New York law as the governing law of the Documents
(other than the Security Agreements) is valid under the laws of
[Trinidad & Tobago][British Virgin Islands]; the submission to the
jurisdiction of the State of New York, United States of America, and the
appointment of the process agent contained in Section 8.05(d) of the IFC A
Loan Agreement and Section 2.11 of the IFC C Loan Agreement is irrevocable
binding on and enforceable against the Company. In this regard, we advice you
that an action brought against the Company in the courts of the State of New
York, in the manner contemplated by the Documents, would be considered an in
personam action under [Trinidad & Tobago][British Virgin Islands] law.

12.     A judgment rendered by any New York State or Federal court sitting in
New York City against the Company in respect of the Documents, would be
enforceable against the Company in the courts of [Trinidad & Tobago]
[the British Virgin Islands], provided that the court in which enforcement is
sought determines that:

        (a)     such New York judgment has been rendered in an IN PERSONAM (as
                opposed to an in rem) action and is strictly for the payment of
                a certain sum of money;

<PAGE>
                                      -77-

                                                                   SCHEDULE 5(A)
                                                                     Page 5 of 6

        (b)     the obligation for which enforcement is sought does not violate
                the law of [Trinidad & Tobago][the British Virgin Islands],
                public policy (ordern publico) of [Trinidad & Tobago][the
                British Virgin Islands], international treaties or agreements
                binding upon [Trinidad & Tobago][the British Virgin Islands] or
                generally accepted principles of international law;

        (c)     process in the New York action has been served personally on the
                Company, or on the appropriate process agent;

        (d)     the New York judgment is a final judgment according to the laws
                of the State of New York, United States of America;

        (e)     the New York judgment fulfills the necessary requirements to be
                considered authentic by [Trinidad & Tobago][the British Virgin
                Islands]'s court;

        (f)     the action on which the final judgment is rendered is not the
                subject matter of a lawsuit among the same parties pending
                before a court in [Trinidad & Tobago][British Virgin Islands];

        (g)     the court issuing the judgment is considered competent under
                internationally accepted rules which are compatible with the
                procedural laws of [Trinidad & Tobago][British Virgin Islands];

        (h)     the applicable procedures under the laws of [Trinidad][British
                Virgin Islands] with respect to the enforcement of foreign
                judgments (including the issuance of a letter rogatory by the
                competent authority of such jurisdiction requesting enforcement
                of such judgment and the certification of such judgment as
                authentic by the corresponding authorities of such jurisdiction
                in accordance with the laws thereof) is complied with; and

        (i)     the courts of the United States would enforce judgments from
                [Trinidad & Tobago][British Virgin Islands] courts, as a matter
                of reciprocity.

13.     On the basis of the immunities and privileges provided in Article VI of
IFC's Articles of Agreement, all payments of principal, interest and other
amounts due under the IFC A Loan Agreement and the IFC C Loan Agreement, are
exempt from any taxes, fees or other charges of whatsoever nature now or at any
time levied or imposed by the Government of [Trinidad & Tobago][British Virgin
Islands] or by any department, agency, political subdivision or taxing authority
thereof or therein or by any organization of which [Trinidad & Tobago][British
Virgin

<PAGE>
                                      -78-

                                                                   SCHEDULE 5(A)
                                                                     Page 6 of 6

Islands] is a member; and the payments referred to herein may be made free and
clear of any deduction or withholding of whatever nature; there are no taxes,
duties (including stamp duties), fees or other charges required to be paid under
the laws of [Trinidad & Tobago][British Virgin Islands] in connection with the
execution, issuance or delivery of any Document or the performance or observance
of any of their respective terms.

The above opinion is given upon and subject to the following qualifications and
limitations:

(a)     the enforcement of the Documents may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws affecting
creditor's rights generally;

(b)     [insert other standard limitations]

This opinion is limited to questions arising under the laws of [Trinidad &
Tobago][British Virgin Islands] and we do not express any opinion as to the laws
of any jurisdiction other than those of [Trinidad & Tobago][British Virgin
Islands].

This opinion is solely for the benefit of IFC and may not be relied upon in any
manner or for any purpose by any other person.

Very truly yours,

        We(5), as [Trinidad & Tobago][British Virgin Islands] counsel to the
Company concur with the opinions expressed hereinabove by [name of the law firm
of IFC's local counsel].

Very truly yours,

----------------------
(5) PriceSmart Counsel

<PAGE>

                                      -79-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 1 of 6

                     FORM OF LOCAL COUNSEL'S LEGAL OPINION(6)

                   (See Section 5.01(f) of the Loan Agreement)

                                                                 [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
U.S.A.

                              RE: PRICESMART, INC.

Dear Sirs,

We have acted as legal counsel to International Finance Corporation ("IFC") in
connection with (i) the loan to PriceSmart, Inc. ("PriceSmart"), PSMT Caribe,
Inc. ("PSMT Caribe") and PSMT Trinidad/Tobago Limited ("PSMT Trinidad" and,
collectively with PriceSmart and PSMT Caribe, the "Co-Borrowers"), as joint and
several borrowers, in the principal amount of twenty-two million Dollars
($22,000,000) pursuant to the Loan Agreement dated January 26, 2001 (the "IFC A
Loan Agreement") by and among the Co-Borrowers and IFC, and (ii) the loan to the
Co-Borrowers jointly and severally in the principal amount of ten million
Dollars ($10,000,000) pursuant to the IFC C Loan Agreement dated January 26,
2001 (the "IFC C Loan Agreement") by and among the Co-Borrowers and IFC. Unless
otherwise defined herein, capitalized terms used herein shall have the meaning
set forth in the IFC A Loan Agreement.

This opinion is furnished to you pursuant to Section 5.01(f) of the IFC A Loan
Agreement.

In connection with the opinion set out below, we have examined the following
documents:

        1. the IFC A Loan Agreement;

        2. the IFC C Loan Agreement;

------------------------
(6) FORM OF LEGAL OPINION TO BE DELIVERED BY IFC'S COUNSEL IN EL SALVADOR,
    DOMINICAN REPUBLIC, HONDURAS, AND COSTA RICA.

<PAGE>
                                      -80-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 2 of 6

        3.      the Share Retention Agreement;

        4.      the Pledge of Shares Agreement, dated January 26, 2001, by and
                among PSMT Caribe, [PriceSmart Dominicana][PriceSmart
                Honduras][PriceSmart El Salvador][PriceSmart Costa Rica](7) and
                IFC (the "Share Pledge Agreement");

        5.      the asset pledge agreement(8), dated __________ (the "Asset
                Pledge Agreement"), among _______________ and IFC;

        6.      the mortgage agreement(9) dated __________________ (the
                "Mortgage Agreement"), among ______________ and IFC;

        7.      a certified copy of the minutes of the extraordinary general
                meeting of ____________________held on ________, ________,
                ________, and ________, respectively;

        8.      a certificate of ______, dated ________, and ___________,
                respectively, evidencing the registration of the Security
                Agreements (as defined below);

        9.      [insert relevant corporate documents]; and

        10.     such other documents as we have considered relevant for the
                purposes of issuing this opinion.

The Asset Pledge Agreement, the Mortgage Agreement, and the Share Pledge
Agreement are hereinafter referred to collectively as the "Security Agreements";
the IFC A Loan Agreement, the IFC C Loan Agreement, and the Share Retention
Agreement, and the Security Agreements are hereinafter referred to individually
as a "Document" and collectively referred to as the "Documents".

In connection with this opinion, we have examined the originals, or certified,
conformed or reproduction copies, of all records, agreements, instruments and
documents as we have deemed relevant or necessary as the basis for the opinions
hereinafter expressed. In stating our opinion, we have assumed (i) the
genuineness of all signatures on original or certified copies of all copies
submitted to us as certified or reproduction copies, and (ii) that each of the
Documents (other than the Security Agreements) are legal, valid, binding and
enforceable under the laws of the State of New York, United States of America.

----------------------------
(7) As applicable.
(8) This refers to the agreement evidencing the first ranking pledge of the
    movable assets in favor of IFC.
(9) This refers to the agreement evidencing the first ranking mortgage over all
    the fixed assets in favor of IFC.

<PAGE>

                                      -81-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 3 of 6

Based upon the foregoing and subject to the qualifications and limitations set
forth herein, we are of the opinion that:

1.      [PriceSmart Guatemala][PriceSmart El Salvador][PriceSmart
        Honduras][PriceSmart Costa Rica] ("Company") is a company duly organized
        and existing under the laws of [Guatemala][El Salvador][Honduras][Costa
        Rica] and has full power and authority required by law to conduct its
        business in which it is engaged.

2.      The Articles of Association of the Company are in full compliance with
the laws and regulations of the jurisdiction of its incorporation and have not
been  amended since _______________.

3.      The Company has a share capital in the amount of __________ (        ),
divided into __________ shares of ________ par value each, which share
capital is duly subscribed and entirely paid-in; to the best of our knowledge
and on the basis of our review of the Company's [shareholders ledger], each
of PSMT Caribe and [NAME OF MINORITY SHAREHOLDER] owns _________% and ___%,
respectively, of the shares and voting rights constituting the share capital
of the Company.

4.      The Company has full power and authority to enter into and perform its
obligations under each of the Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents.

5.      The Company has duly executed and delivered each of the Documents to
which it is a party and each of such Documents constitutes its legal, valid and
binding obligations enforceable in accordance with its terms.

6.      The execution, delivery and performance by the Company of any Document
to which it is a party will not violate (i) its Articles of Association or (ii)
any provisions of the legislation of [Guatemala][El Salvador][Honduras][Costa
Rica], or (iii) to the best of my knowledge, after due inquiry, contravene or
result in a breach of, or constitute a default under, any mortgage, conditional
sales contract, bank loan, credit agreement or any other agreement or instrument
to which the Company is a party or by which the Company or any of its properties
may be bound.

7.      Except as provided in Paragraph 8 below and except for licenses, permits
and consents which are of a routine nature and which are customarily granted in
due course after application, all governmental, corporate, creditors',
shareholders' and other necessary licenses, approvals and consents have been
obtained for:

<PAGE>
                                      -82-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 4 of 6

        7.5     the financing by IFC under the IFC A Loan Agreement and the IFC
                C Loan Agreement;

        7.6     the carrying on of the business of the Company as it is
                presently carried on and is contemplated to be carried on;

        7.7     the due execution and delivery of, and the performance under,
                the Documents and any documents necessary or desirable in their
                implementation; and

        7.8     the remittance to IFC in Dollars of all monies payable in
                respect of any of the Documents, the security created by the
                Security Agreements.

8.      The Security Agreements have been duly executed and delivered in
accordance with the laws of [INSERT NAME OF JURISDISTION] and confer a first
ranking perfected security interest over the assets described therein in favor
of IFC; such Security Agreements have become unconditionally and fully effective
and do not violate or exceed the corporate purpose of [INSERT THE NAME OF THE
SUBSIDIARY WHOSE ASSET IS BEING PLEDGED], as the case may be, or contravene any
provision of any applicable law or regulation binding on the parties thereo.

9.      Under the laws of [NAME OF JURISDICTION], none of the Co-Borrowers or
[NAME OF SUBSIDIARY WHOSE ASSET IS BEING PLEDGED], nor their respective property
has any immunity from jurisdiction of any court or from set-off or any legal
process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution or otherwise).

10.     To the best of our knowledge after due inquiry, no litigation,
investigation or proceeding of or before any Authority is pending against the
Co-Borrowers or [INSERT THE NAME OF THE SUBSIDIARY WHOSE ASSET IS BEING PLEDGED]
or against their respective properties or revenues.

11.     The choice of New York law as the governing law of the Documents (other
than the Security Agreements) is valid under the laws of [Guatemala][El
Salvador][Honduras][Costa Rica]; the submission to the jurisdiction of the State
of New York, United States of America, and the appointment of the process agent
contained in Section 8.05(d) of the IFC A Loan Agreement and Section 2.11 of the
IFC C Loan Agreement is irrevocable binding on and enforceable against the
Company or any Co-Borrower. In this regard, we advice you that an action brought
against the Company or any Co-Borrower in the courts of the State of New York,
in the manner contemplated by the Documents, would be considered an in personam
action under [Guatemala][El Salvador][Honduras][Costa Rica] law.

<PAGE>

                                      -83-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 5 of 6

12.     A judgment rendered by any New York State or Federal court sitting in
New York City against the Company or any Co-Borrower in respect of the
Documents, would be enforceable against the Company or any Co-Borrower in the
courts of [Guatemala][El Salvador][Honduras][Costa Rica], provided that the
court in which enforcement is sought determines that:

        (a)     such New York judgment has been rendered in an IN PERSONAM (as
                opposed to an in rem) action and is strictly for the payment of
                a certain sum of money;

        (b)     the obligation for which enforcement is sought does not violate
                the law or public policy (ordern publico) of [Guatemala][El
                Salvador][Honduras][Costa Rica], or international treaties or
                agreements binding upon [Guatemala][El Salvador][Honduras][Costa
                Rica] or generally accepted principles of international law;

        (c)     process in the New York action has been served personally on the
                Company or any Co-Borrower, or on the appropriate process agent;

        (d)     the New York judgment is a final judgment according to the laws
                of the State of New York, United States of America;

        (e)     the New York judgment fulfills the necessary requirements to be
                considered authentic by [Guatemala][El Salvador][Honduras][Costa
                Rica]'s court;

        (f)     the action on which the final judgment is rendered is not the
                subject matter of a lawsuit among the same parties pending
                before a court in [Guatemala][El Salvador][Honduras][Costa
                Rica];

        (g)     the court issuing the judgment is considered competent under
                internationally accepted rules which are compatible with the
                procedural laws of [Guatemala][El Salvador][Honduras][Costa
                Rica] [Trinidad] or [British Virgin Islands];

<PAGE>
                                      -84-

                                                                 SCHEDULE 5(B-1)
                                                                     Page 6 of 6

        (h)     the applicable procedures under the laws of [Guatemala][El
                Salvador][Honduras][Costa Rica] to the enforcement of foreign
                judgments (including the issuance of a letter rogatory by the
                competent authority of such jurisdiction requesting enforcement
                of such judgment and the certification of such judgment as
                authentic by the corresponding authorities of such jurisdiction
                in accordance with the laws thereof) is complied with; and

        (i)     the courts of the United States would enforce judgments from
                [Guatemala][El Salvador][Honduras][Costa Rica] courts, as the
                case may be, as a matter of reciprocity.

13.     On the basis of the immunities and privileges provided in Article VI of
IFC's Articles of Agreement, all payments of principal, interest and other
amounts due under the IFC A Loan Agreement and the IFC C Loan Agreement, are
exempt from any taxes, fees or other charges of whatsoever nature now or at any
time levied or imposed by the Government of [Guatemala][El
Salvador][Honduras][Costa Rica] or by any department, agency, political
subdivision or taxing authority thereof or therein or by any organization of
which [Guatemala][El Salvador][Honduras][Costa Rica] is a member; and the
payments referred to herein may be made free and clear of any deduction or
withholding of whatever nature; there are no taxes, duties (including stamp
duties), fees or other charges required to be paid under the laws of
[Guatemala][El Salvador][Honduras][Costa Rica] in connection with the execution,
issuance or delivery of any Document or the performance or observance of any of
their respective terms.

The above opinion is given upon and subject to the following qualifications and
limitations:

(a)     the enforcement of the Documents may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws affecting
creditor's rights generally;

(b)     [insert other standard limitations]

This opinion is limited to questions arising under the laws of [Guatemala][El
Salvador][Honduras][Costa Rica] and we do not express any opinion as to the laws
of any jurisdiction other than those of [Guatemala][El Salvador][Honduras][Costa
Rica].

This opinion is solely for the benefit of IFC and may not be relied upon in any
manner or for any purpose by any other person.

Very Truly Yours,

<PAGE>

                                      -85-

                                                                 SCHEDULE 5(B-2)
                                                                     Page 1 of 6

                    FORM OF LOCAL COUNSEL'S LEGAL OPINION(10)
                   (See Section 5.01(f) of the Loan Agreement)

                                                       [Date]
International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
U.S.A.

                              RE: PRICESMART, INC.

Dear Sirs,

We have acted as legal counsel to International Finance Corporation ("IFC") in
connection with (i) the loan to PriceSmart, Inc. ("PriceSmart"), PSMT Caribe,
Inc. ("PSMT Caribe") and PSMT Trinidad/Tobago Limited ("PSMT Trinidad" and,
collectively with PriceSmart and PSMT Caribe, the "Co-Borrowers"), as joint and
several borrowers, in the principal amount of twenty-two million Dollars
($22,000,000) pursuant to the Loan Agreement dated January 26, 2001 (the "IFC A
Loan Agreement") by and among the Co-Borrowers and IFC, and (ii) the loan to the
Co-Borrowers jointly and severally in the principal amount of ten million
Dollars ($10,000,000) pursuant to the IFC C Loan Agreement dated January 26,
2001 (the "IFC C Loan Agreement") by and among the Co-Borrowers and IFC. Unless
otherwise defined herein, capitalized terms used herein shall have the meaning
set forth in the IFC A Loan Agreement.

This opinion is furnished to you pursuant to Section 5.01(f) of the IFC A Loan
Agreement.

---------------------
(10) FORM OF LEGAL OPINION TO BE DELIVERED BY IFC'S COUNSEL IN BARBADOS.

<PAGE>

                                      -86-

                                                                 SCHEDULE 5(B-2)
                                                                     Page 2 of 6

In connection with the opinion set out below, we have examined the following
documents:

        1.      the IFC A Loan Agreement;

        2.      the IFC C Loan Agreement;

        3.      the Share Retention Agreement;

        4.      the Pledge of Shares Agreement, dated January 26, 2001, by and
                among PriceSmart, PSMT Barbados and IFC (the "Share Pledge
                Agreement");

        5.      a certified copy of the minutes of the extraordinary general
                meeting of ____________________held on ________,;

        6.      a certificate of ______________, evidencing the registration of
                the Share Pledge Agreement;

        7.      [insert relevant corporate documents]; and

        8.      such other documents as we have considered relevant for the
                purposes of issuing this opinion.

The Share Pledge Agreement, the IFC A Loan Agreement, the IFC C Loan Agreement,
and the Share Retention Agreement, are hereinafter referred to individually as a
"Document" and collectively referred to as the "Documents".

In connection with this opinion, we have examined the originals, or certified,
conformed or reproduction copies, of all records, agreements, instruments and
documents as we have deemed relevant or necessary as the basis for the opinions
hereinafter expressed. In stating our opinion, we have assumed (i) the
genuineness of all signatures on original or certified copies of all copies
submitted to us as certified or reproduction copies, and (ii) that each of the
Documents (other than the Security Agreements) are legal, valid, binding and
enforceable under the laws of the State of New York, United States of America.

Based upon the foregoing and subject to the qualifications and limitations set
forth herein, we are of the opinion that:

1.      PSMT Barbados ("Company") is a company duly organized and existing under
        the laws of Barbados and has full power and authority required by law to
        conduct its business in which it is engaged.

<PAGE>

                                      -87-

                                                                 SCHEDULE 5(B-2)
                                                                     Page 3 of 6

2.      The Articles of Association of the Company are in full compliance with
the laws and regulations of the jurisdiction of its incorporation and have not
been amended since _______________.

3.      The Company has a share capital in the amount of __________ (         ),
divided into __________ shares of ________ par value each, which share
capital is duly subscribed and entirely paid-in; to the best of our knowledge
and on the basis of our review of the Company's [shareholders ledger], each
of PiceSmart and [NAME OF MINORITY SHAREHOLDER] owns _________% and ___%,
respectively, of the shares and voting rights constituting the share capital
of the Company.

4.      The Company has full power and authority to enter into and perform its
obligations under each of the Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents.

5.      The Company has duly executed and delivered each of the Documents to
which it is a party and each of such Documents constitutes its legal, valid and
binding obligations enforceable in accordance with its terms.

6.      The execution, delivery and performance by the Company of any Document
to which it is a party will not violate (i) its Articles of Association or (ii)
any provisions of the legislation of Barbados, or (iii) to the best of my
knowledge, after due inquiry, contravene or result in a breach of, or constitute
a default under, any mortgage, conditional sales contract, bank loan, credit
agreement or any other agreement or instrument to which the Company is a party
or by which the Company or any of its properties may be bound.

7.      Except as provided in Paragraph 8 below and except for licenses, permits
and consents which are of a routine nature and which are customarily granted in
due course after application, all governmental, corporate, creditors',
shareholders' and other necessary licenses, approvals and consents have been
obtained for:

        7.9     the financing by IFC under the IFC A Loan Agreement and the IFC
                C Loan Agreement;

        7.10    the carrying on of the business of the Company as it is
                presently carried on and is contemplated to be carried on;

        7.11    the due execution and delivery of, and the performance under,
                the Documents and any documents necessary or desirable in their
                implementation; and

<PAGE>

                                      -88-

                                                                 SCHEDULE 5(B-2)
                                                                     Page 4 of 6

        7.12    the remittance to IFC in Dollars of all monies payable in
                respect of any of the Documents, the security created by the
                Share Pledge Agreement.

8.      The Share Pledge Agreement has been duly executed and delivered in
accordance with the laws of Barbados and confer a first ranking perfected
security interest over the shares described therein in favor of IFC; such Share
Pledge Agreement has become unconditionally and fully effective and do not
violate or exceed the corporate purpose of PSMT Barbados or contravene any
provision of any applicable law or regulation binding on the parties thereo.

9.      Under the laws of Barbados, none of the Co-Borrowers or PSMT Barbados,
nor their respective properties has any immunity from jurisdiction of any court
or from set-off or any legal process (whether through service or notice,
attachment prior to judgment, attachment in aid of execution or otherwise).

10.     To the best of our knowledge after due inquiry, no litigation,
investigation or proceeding of or before any Authority is pending against the
Co-Borrowers or PSMT Barbados or against their respective properties or
revenues.

11.     The choice of New York law as the governing law of the Documents (other
than the Share Pledge Agreement) is valid under the laws of Barbados; the
submission to the jurisdiction of the State of New York, United States of
America, and the appointment of the process agent contained in Section 8.05(d)
of the IFC A Loan Agreement and Section 2.11 of the IFC C Loan Agreement is
irrevocable binding on and enforceable against the Company or any Co-Borrower.
In this regard, we advice you that an action brought against the Company or any
Co-Borrower in the courts of the State of New York, in the manner contemplated
by the Documents, would be considered an in personam action under Barbados law.

12.     A judgment rendered by any New York State or Federal court sitting in
New York City against the Company or any Co-Borrower in respect of the
Documents, would be enforceable against the Company or any Co-Borrower in the
courts of Barbados, provided that the court in which enforcement is sought
determines that:

        (a)     such New York judgment has been rendered in an IN PERSONAM (as
                opposed to an in rem) action and is strictly for the payment of
                a certain sum of money;

        (b)     the obligation for which enforcement is sought does not violate
                the law or public policy (ordern publico) of Barbados, or
                international treaties or agreements binding upon Barbados or
                generally accepted principles of international law;

<PAGE>
                                      -89-

                                                                SCHEDULE 5(B-2)
                                                                Page 5 of 6

        (c)     process in the New York action has been served personally on the
                Company or any Co-Borrower, or on the appropriate process agent;

        (d)     the New York judgment is a final judgment according to the laws
                of the State of New York, United States of America;

        (e)     the New York judgment fulfills the necessary requirements to be
                considered authentic by Barbados courts;

        (f)     the action on which the final judgment is rendered is not the
                subject matter of a lawsuit among the same parties pending
                before a court in Barbados;

        (g)     the court issuing the judgment is considered competent under
                internationally accepted rules which are compatible with the
                procedural laws of Barbados;

        (h)     the applicable procedures under the laws of Barbados to the
                enforcement of foreign judgments (including the issuance of a
                letter rogatory by the competent authority of such jurisdiction
                requesting enforcement of such judgment and the certification of
                such judgment as authentic by the corresponding authorities of
                such jurisdiction in accordance with the laws thereof) is
                complied with; and

        (i)     the courts of the United States would enforce judgments from
                Barbados courts, as the case may be, as a matter of reciprocity.

13.     On the basis of the immunities and privileges provided in Article VI of
IFC's Articles of Agreement, all payments of principal, interest and other
amounts due under the IFC A Loan Agreement and the IFC C Loan Agreement, are
exempt from any taxes, fees or other charges of whatsoever nature now or at any
time levied or imposed by the Government of Barbados or by any department,
agency, political subdivision or taxing authority thereof or therein or by any
organization of which Barbados is a member; and the payments referred to herein
may be made free and clear of any deduction or withholding of whatever nature;
there are no taxes, duties (including stamp duties), fees or other charges
required to be paid under the laws of Barbados in connection with the execution,
issuance or delivery of any Document or the performance or observance of any of
their respective terms.

<PAGE>

                                      -90-

                                                                 SCHEDULE 5(B-2)
                                                                     Page 6 of 6

The above opinion is given upon and subject to the following qualifications and
limitations:

(a)     the enforcement of the Documents may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws affecting
creditor's rights generally;

(b)     [insert other standard limitations]

This opinion is limited to questions arising under the laws of Barbados and we
do not express any opinion as to the laws of any jurisdiction other than those
of Barbados.

This opinion is solely for the benefit of IFC and may not be relied upon in any
manner or for any purpose by any other person.

Very truly yours,

<PAGE>

                                      -91-

                                                                 SCHEDULE 5(B-3)
                                                                     Page 1 of 3

                    FORM OF LOCAL COUNSEL'S LEGAL OPINION(11)
                   (See Section 5.01(f) of the Loan Agreement)

                                                     [Date]

International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
U.S.A.

               Re: PriceSmart, Inc.

Ladies and Gentlemen:

We have acted as legal counsel to International Finance Corporation ("IFC") in
connection with (i) the loan to PriceSmart, Inc. ("PriceSmart"), PSMT Caribe,
Inc. ("PSMT Caribe") and PSMT Trinidad/Tobago Limited ("PSMT Trinidad" and,
collectively with PriceSmart and PSMT Caribe, the "Co-Borrowers"), as joint and
several borrowers, in the principal amount of twenty-two million Dollars
($22,000,000) pursuant to the Loan Agreement dated January 26, 2001 (the "IFC A
Loan Agreement") by and among the Co-Borrowers and IFC, and (ii) the loan to the
Co-Borrowers jointly and severally in the principal amount of ten million
Dollars ($10,000,000) pursuant to the IFC C Loan Agreement dated January 26,
2001 (the "IFC C Loan Agreement") by and among the Co-Borrowers and IFC. Unless
otherwise defined herein, capitalized terms used herein shall have the meaning
set forth in the IFC A Loan Agreement.

This opinion is furnished to you pursuant to Section 5.01(f) of the IFC A Loan
Agreement.

In connection with the opinion set out below, we have examined the following
documents:

        1.     the IFC A Loan Agreement;

        2.     the IFC C Loan Agreement;

        3.     the Share Retention Agreement;

-----------------------------
(11) TO BE USED BY IFC'S COUNSEL IN GUATEMALA, ARUBA, PANAMA AND THE
     PHILIPPINES.

<PAGE>

                                      -92-

                                                                 SCHEDULE 5(B-3)
                                                                     Page 2 of 3

        4.      a certified/conformed copy of] [an executed copy/original of]
                [LIST ALL OTHER DOCUMENTS REVIEWED, E.G ARTICLES OF
                INCORPORATION, ESTATUTOS, ETC.].

In connection with this opinion, we have examined the originals, or certified,
conformed copies, of all records, agreements, instruments and documents as we
have deemed relevant or necessary as the basis for the opinions hereinafter
expressed. In stating my opinion, we have assumed (i) the genuineness of all
signatures on original or certified copies of all copies submitted to us as
certified or reproduction copies, and that the Share Retention Agreement and
each of the other Transaction Documents constitutes a legal, valid, binding and
enforceable obligation of each of the other parties thereto under the laws of
the State of New York, United States of America.

Based upon the foregoing and subject to the qualifications and limitations set
forth herein, we are of the opinion that:

1.      [Philippines, Inc.][PriceSmart (Guatemala), S.A.][Islands Foods and
        Distributors N.V.][PriceCosto de Panama, S.A.] (the "Company") is a
        company duly incorporated, validly existing and in good standing under
        the laws of [the Philippines][Aruba][Guatemala][Panama] and has full
        power and authority required by law to conduct its business in which it
        is engaged and to enter into the Share Retention Agreement and to
        perform its obligations thereunder.

2.      The Company, represented by ________________ in his capacity as Chief
        Executive Officer, has full power and authority to enter into and
        perform its obligations under the Share Retention Agreement and has
        taken all necessary corporate action to authorize the execution,
        delivery and performance by it of the Share Retention Agreement.

3.      The Company has a share capital in the amount of __________ , divided
        into __________ shares of ________ par value each, which share capital
        is duly subscribed and entirely paid-in; to the best of our knowledge
        and on the basis of our review of the Company's [shareholders ledger],
        each of PriceSmart and [NAME OF MINORITY SHAREHOLDER] owns _________%
        and ___%, respectively, of the shares and voting rights constituting the
        share capital of the Company.

4.      The Share Retention Agreement has been authorized, executed and
        delivered by the Company and constitutes a valid and legally binding
        obligation of the Company, enforceable in accordance with its terms.

<PAGE>
                                      -93-

                                                                 SCHEDULE 5(B-3)
                                                                     Page 3 of 3

5.      The execution and delivery of the Share Retention Agreement and
        performance of the obligations thereunder by the Company will not (i)
        violate the charter or other organizational documents of the Company,
        (ii) violate any provisions of the Company, or (iii) to the best of my
        knowledge, after due inquiry, contravene or result in a breach of, or
        constitute a default under, any mortgage, conditional sales contract,
        bank loan, credit agreement or any other agreement or instrument to
        which the Company is a party or by which the Company or any of its
        properties may be bound.

6.      It is not required in order to ensure the validity, effectiveness or
        enforceability of any of the Share Retention Agreement that the same be
        notarized or filed, registered or recorded in a public office or
        elsewhere in [the Philippines][Aruba][Guatemala][Panama], or that any
        other instrument, document or notice relating thereto be executed,
        delivered, filed, registered, recorded or served in the Philippines.

7.      No order, consent, approval, license, authorization or validation of, or
        registration, recording or filing with any governmental or public body
        or authority in [the Philippines][Aruba][Guatemala][Panama] is required
        in connection with (i) the execution or delivery of the Share Retention
        Agreement or the performance by the parties thereto of their respective
        obligations thereunder or (ii) the legality, validity, binding effect or
        enforceability of the Share Retention Agreement.

                                Very truly yours,

<PAGE>

                                      -94-

                                                                   SCHEDULE 5(C)
                                                                     Page 1 of 5

                     FORM OF SPECIAL COUNSEL'S LEGAL OPINION
                   (See Section 5.01(g) of the Loan Agreement)

<PAGE>

                                      -95-

<PAGE>

                                      -96-

<PAGE>

                                      -97-

<PAGE>

                                      -98-

<PAGE>

                                      -99-

                                                                   SCHEDULE 5(D)
                                                                     Page 1 of 5

               FORM OF PRICESMART SPECIAL COUNSEL'S LEGAL OPINION
                   (See Section 5.01(h) of the Loan Agreement)

<PAGE>

                                     -100-

<PAGE>

                                     -101-

<PAGE>

                                     -102-

<PAGE>

                                     -103-

<PAGE>

                                     -104-

                                                                      SCHEDULE 6
                                                                     Page 1 of 2

                      FORM OF LETTER TO BORROWER'S AUDITORS

         (See Section 5.01(l) and Section 6.01(e) of the Loan Agreement)

                             [Borrower's Letterhead]

                                                                          [Date]

[NAME OF AUDITORS]
[ADDRESS]

Ladies and Gentlemen:

        We hereby authorize and request you to give to International Finance
Corporation of 2121 Pennsylvania Avenue, N.W., Washington, D.C. 20433, United
States of America ("IFC"), all such information as IFC may reasonably request
with regard to the Consolidated financial statements of the Co-Borrowers (as
defined below), both audited and unaudited. We have agreed to supply that
information and those statements under the terms of a Loan Agreement among
PriceSmart Inc., PSMT Caribe Inc. and PSMT Trinidad/Tobago Limited (the
"Co-Borrowers") and IFC dated as of January 26, 2001 (the "Loan Agreement"). For
your information we enclose a copy of the Loan Agreement.

        We authorize and request you to send two copies of the audited accounts
of the Co-Borrowers to IFC to enable us to satisfy our obligation to IFC under
Section 6.03(b)(i) of the Loan Agreement. When submitting the same to IFC,
please also send, at the same time, a copy of your full report on such accounts
in a form reasonably acceptable to IFC.

        Please note that under Section 6.03(b)(ii) and (iii) and Section 6.03(c)
of the Loan Agreement, we are obliged to provide IFC with:

<PAGE>

                                     -105-

                                                                      SCHEDULE 6
                                                                     Page 2 of 2

        (a) a copy of the annual and any other management letter or other
communication from you to the Co-Borrowers or their repective management
commenting on, among other things, the adequacy of the Co-Borrowers' financial
control procedures and accounting and management information system; and

        (b) a report by you certifying that, based upon their audited
consolidated financial statements, the Co-Borrowers were in compliance with the
financial covenants contained in Section 6.02 of the Loan Agreement as at the
end of the relevant Financial Year or, as the case may be, detailing any
noncompliance.

        Please also submit each such communication and report to IFC with the
audited accounts.

        For our records, please ensure that you send to us a copy of every
letter which you receive from IFC immediately upon receipt and a copy of each
reply made by you immediately upon the issue of that reply.

                                            Yours truly,

                                            PRICESMART INC.

                                            By ______________________________
                                               Authorized Representative

Enclosure

cc: Director
    Latin America and Caribbean Department
    International Finance Corporation
    2121 Pennsylvania Avenue, N.W.
    Washington, D.C. 20433
    United States of America

<PAGE>

                                     -106-

                                                                      SCHEDULE 7
                                                                     Page 1 of 2

        FORM OF CO-BORROWER'S CERTIFICATION ON DISTRIBUTION OF DIVIDENDS

                   (See Section 6.02(a) of the Loan Agreement)

                           [Co-Borrower's Letterhead]

                                                                          [Date]
International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C.  20433
Attention:  Director, Latin America and Caribbean Department

               Re: [Country/_________]

Dear Sirs:

1. Please refer to the Loan Agreement (the "Loan Agreement") dated as of January
26, 2001, between [Name of Relevant Co-Borrower] (the "Co-Borrower"), [Names of
the other Co-Borrowers] and International Finance Corporation ("IFC"). Terms
defined in the Loan Agreement have their defined meanings whenever used in this
request.

2. This is to inform you that the Co-Borrower plans a distribution of dividends
to its shareholders in the aggregate amount of ______________ (______), such
distribution to commence on or about _________, 20__. Pursuant to Section
6.02(a) of the Loan Agreement, the Co-Borrower hereby certifies that, as at the
date hereof:

        (a)     the proposed distribution will be entirely out of retained
                earnings and such retained earnings do not include any amount
                resulting from the revaluation of the Co-Borrower's assets;

        (b)     no Event of Default or Potential Event of Default has occurred
                and is continuing;

<PAGE>

                                     -107-

                                                                      SCHEDULE 7
                                                                     Page 2 of 2

        (c)     after giving effect to the proposed distribution:

                (i)     the Consolidated Current Ratio would be at least 1.2;

                (ii)    the Consolidated Total Debt to Equity Ratio would be
                        greater than 50:50; and

                (iii)   the Consolidated Long-term Debt Service Coverage Ratio
                        would not be less than 1.5.

3. The Co-Borrower undertakes not to give effect to the proposed distribution or
any part thereof if, at the time of so doing or after giving effect to it, the
Co-Borrower could not certify the matters referred to in Section 2 of this
certification.

                                                   Yours truly,

                                            [NAME OF CO-BORROWER]

                                            By _______________________________
                                                    Authorized Representative

<PAGE>

                                     -108-

                                                                      SCHEDULE 8
                                                                     Page 1 of 1

                   PROGRESS REPORT RE: PROJECT IMPLEMENTATION

                (See Section 6.03(a)(iii) of the Loan Agreement)

The Co-Borrowers shall provide an overview of the Project and highlight the
major events for the reporting period.

<PAGE>

                                     -109-

                                                                      SCHEDULE 9
                                                                     Page 1 of 1

           INFORMATION TO BE INCLUDED IN ANNUAL REVIEW OF OPERATIONS*

                 (See Section 6.03(b)(iv) of the Loan Agreement)

        [(1)   SHAREHOLDINGS. Information on significant changes in share
               ownership of the Co-Borrowers, the reasons for such changes, and
               the identity of major new shareholders.

        (2)    COUNTRY CONDITIONS AND GOVERNMENT POLICY. Report on any material
               changes in local conditions, including government policy changes,
               that directly affect the Co-Borrowers (e.g. changes in government
               economic strategy, taxation, foreign exchange availability, price
               controls, and other areas of regulations.)

        (3)    MANAGEMENT AND TECHNOLOGY. Information on significant changes in
               (i) the Co-Borrowers' senior management or organizational
               structure, and (ii) technology used by the Co-Borrowers,
               including technical assistance arrangements.

        (4)    CORPORATE STRATEGY. Description of any changes to the
               Co-Borrowers' corporate or operational strategy, including
               changes in products, degree of integration, and business
               emphasis.

        (5)    MARKETS. Brief analysis of changes in the Co-Borrowers' market
               conditions (both domestic and export), with emphasis on changes
               in market share and degree of competition.

        (6)    OPERATING PERFORMANCE. Discussion of major factors affecting the
               year's financial results (sales by value and volume, operating
               and financial costs, profit margins, capacity utilization,
               capital expenditure, etc.).

        (7)    FINANCIAL  CONDITION. Key financial ratios for previous year,
               compared with ratios covenanted in the Loan Agreement.]

----------------------------
* The content of this Schedule should be reviewed with the Investment Officer
  to determine any revisions appropriate for a particular transaction.

<PAGE>

                                     -110-

                                                                     SCHEDULE 10
                                                                     Page 1 of 9

                        FORM OF ANNUAL MONITORING REPORT

                   (See Section 6.03(d) of the Loan Agreement)

                            [See the following pages]

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