Internal Audit Report 

West Coast Cold, LLC 
d/b/a CityIce Cold Storage, LLC 

Lease and Concession Compliance Audit 


January 1, 2009 to December 31, 2010 


Issue Date: August 02, 2011 
Report No. 2011-14

Internal Audit 
West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC 
Agreement #131, #594, #842 and #1481 

Table of Contents 
Transmittal Letter .............................................................................................................. 3 
Executive Summary .......................................................................................................... 4 
Background ....................................................................................................................... 5 
Audit Objective .................................................................................................................. 5 
Audit Scope and Methodology ......................................................................................... 6 
Conclusion ......................................................................................................................... 6 













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Internal Audit 
West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC 
Agreement #131, #594, #842 and #1481 

Transmittal Letter 

We have completed an audit of the Lease and Concession Agreement, as amended, between 
the Port of Seattle and West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC. 
The purpose of the audit was to determine whether: 
1)  Reported concession was complete and properly calculated. 
2)  The Port and the lessee complied with provisions of the Lease and Concession Agreement. 
We examined information related to a two-year period from January 1, 2009, through December
31, 2010. 
We conducted our audit using due professional care. We planned and performed the audit to
obtain reasonable assurance as to compliance with significant provisions of the agreement,
including complete and timely reporting of concessionable revenues. 
CityIce Cold Storage, LLC materially complied with the terms of the Lease and Concession
agreement. 
We extend our appreciation to the Seaport Industrial, Cruise and Dock Services management
and staff of Real Estate Lease Administration, and Accounting & Financial Reporting for their
assistance and cooperation during the audit. 
Thank you. 


Joyce Kirangi, CPA 
Director, Internal Audit 






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Internal Audit 
West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC 
Agreement #131, #594, #842 and #1481 

Executive Summary 

Audit Scope and Objective The purpose of the audit was to determine the following: 
1)  Reported concession was complete and properly calculated. 
2)  The Port and the lessee complied with provisions of the Lease and Concession Agreement. 
We examined the books and records of CityIce Cold Storage, LLC for a two-year period from
January 1, 2009 through December 31, 2010. Seaport Industrial, Cruise and Dock Services, in
conjunction with Accounting and Financial Reporting (AFR), has the primary responsibility for
administering and monitoring the agreement to ensure compliance with agreed-upon terms. 
Agreement Terms  The agreement requires CityIce Cold Storage, LLC to pay the Port a
quarterly Percentage Rental fee of 3% of its Gross Revenue. The fee is payable only to the
extent that it is greater than the Guaranteed Minimum Rent (GMR) attributable to Building No. 
39 and 390 land area on the agreement # 131. The agreements # 594, #842, and #1481 were
subject to an adjustment annually to reflect changes in the Consumer Price Index (CPI). 
The GMR and monthly rent are payable in advance on or before the first day of each month,
without notice from the Port  and without setoff or deduction. The Percentage Rental, if
applicable, is due on or before the 20th of the month following the end of each calendar quarter. 
For untimely payments, the agreement provides for a one-time late fee of 5% of the overdue
amount and interest to be accrued at the rate of 18% per annum from the due date until paid. 
Audit Result Summary  CityIce Cold Storage, LLC materially complied with the terms of the
Lease and Concession agreement. 







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Internal Audit 
West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC 
Agreement #131, #594, #842 and #1481 

Background 
West Coast Cold, LLC acquired CityIce Cold Storage, LLC Company in 2010 and Seafreeze in 
2008, and combined them into the current Seafreeze/CityIce operations. West Coast Cold LLC 
is a Delaware corporation with many independent operations in the United States, Canada and
around the world. CityIce Cold Storage, LLC provides secondary packaging, onsite processing,
agricultural storage, and industrial Imports. 
The Port currently has five separate agreements with CityIce Cold Storage, LLC for various
locations at Terminal 91 and south end of Terminal 115. All five agreements have a fixed
monthly rent to be adjusted annually based on CPI, but they do not all have a concession as
part of the agreed-upon terms and conditions. Agreement #131 is the only agreement of the five
where a concession of 3% of Gross Revenue is required. If applicable, CityIce Cold Storage, 
LLC pays the Port a quarterly concession percentage fee of 3% of its Gross Revenue in excess
of quarterly Guaranteed Minimum Rent applicable to Building # 39 and 390 land area. 
The concession fee is payable to the Port no later than 20 days after the end of calendar
quarter. For untimely payments, the agreement provides a one-time late fee of 5% of the
overdue amount and interest to be accrued at the rate of 18% per annum from the due date until
paid. 
Below are CityIce Cold Storage, LLC financial highlights for the last three years related to the
building No. 39 and 390 land area: 
Percentage
Year                            Rental 
Reported        (payable if it        Rent 
Gross Revenue     exceeds the        Paid 
rent paid) 
2008            $3,802,705        $114,081        $286,936 
2009            $4,220,211        $126,606        $298,882 
2010                      *               *        $313,824 
Total               $8,022,916         $240,687         $585,818 
Source: PROPWorks and PeopleSoft 
* Effective January 1, 2010, the Percentage Rental fee under lease agreement #131 was no longer applicable. 

Audit Objective 
The purpose of the audit was to determine the following: 
1)  Reported concession was complete and properly calculated. 
2)  The Port and the lessee complied with provisions of the Lease and Concession Agreement. 
The scope of the audit covered the period of January 1, 2009 through December 31, 2010. 

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Internal Audit 
West Coast Cold, LLC d/b/a CityIce Cold Storage, LLC 
Agreement #131, #594, #842 and #1481 

Audit Scope and Methodology 
We conducted the audit to determine whether the parties were in compliance with the lease
agreements including, but not limited to, the percentage rental. Our approach to the audit was
risk-based from planning to test sampling. We applied additional detailed audit procedures to
areas with the highest likelihood of significant negative impact as follows: 
Percentage Rental                           Insurance liability 
The CPI adjustment                          Surety Bond/Security Deposit. 
a.  Percentage Rental 
We evaluated the lessee's 2009 Statement of Operations and the 4th quarter state Business
Occupation (B&O) tax return to determine if reported gross revenues were reasonably
complete. We further calculated the gross revenues at which the 3% Percentage Rental
would have been triggered. We compared the calculated gross revenues to the reported in
order to determine whether the percentage rental fee was applicable, and if so, it was
completely and accurately calculated. 
b.  The CPI (Consumer Price Index) Adjustment 
We individually reviewed the CPI adjustment under each agreement and confirmed 
compliance. 
c.   Insurance Liability 
We individually reviewed insurance requirements under each agreement. The review results
were compared to coverage, as reflected in Insurance Certificate, to ensure compliance. 
d.  Surety Bond/Security Deposit 
We reviewed surety requirements under each agreement. We agreed such requirements to
Surety Bond to ensure compliance. 

Conclusion 
Based on our audit, CityIce Cold Storage, LLC materially complied with the terms of the Lease
and Concession agreement. 



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