Company: ADPT
Filing Date: 2025-03-03
Form Type: 10-K
Source: 0000950170-25-030913
Chunk: 182

Company: Adaptive Biotechnologies Corp
Filing Date: 2025-03-03
Form: 10-K
Item: Item 1B
Chunk 182
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 of the asset group to future net undiscounted cash flows projected to be generated over the remaining lease term. These projections include management's estimates of cash inflows from potential sublease income and outflows for operating and maintenance expenses. The carrying amount was found to be unrecoverable, thus we assessed the asset group's fair value. The extent to which the asset group's carrying amount exceeds its fair value represents the impairment cost to be recognized. Fair value was determined using the income approach, whereby we discounted estimated net cash flows using a rate commensurate with our estimated incremental borrowing rate. As a result of this assessment, which included unrecoverable operating and maintenance costs, we determined that the asset group was to be fully impaired. As such, an impairment charge of $25.4 million was recognized during the year ended December 31, 2023, $21.2 million of which related to the right-of-use asset and $4.2 million of which related to the long-lived leasehold improvements, all of which were held for use.In August 2019, we entered into an agreement to rent approximately 100,000 square feet in what was a to-be-constructed, new headquarters building in Seattle, Washington. In connection with the lease, we entered into a $2.1 million letter of credit with one of our existing financial institutions. The lease commenced in December 2020, when the landlord delivered the premises to us for construction of certain tenant improvements. We occupied the new building in 2021, cash payment for rent began in October 2021 and the lease term ends in August 2033, subject to our option to twice extend the lease for five years. In connection with this lease, the landlord agreed to fund $20.0 million in improvements, which was subsequently reduced to $14.8 million as a result of our change requests made during landlord construction of the building, net of an administration fee. We incurred $14.9 million in certain tenant improvement costs, all of which had been reimbursed by the landlord as of December 31, 2022. The lease also requires us to pay additional amounts for operating and maintenance expenses.In April 2018, we entered into a lease agreement to lease approximately 13,400 square feet in South San Francisco, California. The lease term is through March 2026 and provides for one five-year extension option. We are responsible for our share of allocable operating expenses, tax expenses and utilities costs during the duration of the lease term. In connection