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Issue Date: December 4, 2025

Report No. 2025-19

Executive Summary

Internal Audit (IA) completed limited procedures related to the Lease and Concession Agreement

(Agreement) between Sun’s, Inc. and the Port of Seattle (Port).

The period reviewed was January 1, 2024, through December 31, 2024.

The review was performed to determine whether concession fees remitted to the Port were complete

and properly calculated.

Glenn Fernandes, CPA

Director, Internal Audit

Responsible Management Team

On June 29, 2016, the Port entered into a lease agreement with Sun’s, Inc. Under this agreement, Sun’s

Inc. operates Manchu Wok. The agreement was amended in 2018, which removed the Minimum Annual

Guarantee, and only required percentage fees, according to the following schedule:

12% of annual gross receipts less than or equal to $2,000,000

13% of annual gross receipts between $2,000,000 and less than or equal to $4,000,000

15% of annual gross receipts greater than $4,000,000

The table below reflects Sun’s, Inc. Gross Sales:

Approach

The period assessed was January 2024, through December 2024 and included the following

procedures:

• Validated that the percentage fees were calculated correctly and in accordance with the lease revenue

• Reviewed the Profit & Loss statements for variances

• Reviewed a random sample of invoices to determine if they were paid on time, and for the full amount