Company: ARVN
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001628280-25-049527
Chunk: 108

Company: ARVINAS, INC.
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 1
Chunk 108
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-Use Assets and Liabilities.

6. Right-of-Use Assets and Liabilities

Operating lease liabilities and their corresponding right-of-use ("ROU") assets are recorded based on the present value of lease payments over the expected remaining lease term. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rate, which reflects the fixed rate at which it could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term, in a similar economic environment. The Company's weighted average incremental borrowing rate at September 30, 2025 totaled 7.0%. Lease expense is recognized on a straight-line basis over the lease term.In August 2024, the Company entered into a Lease Termination Agreement with 101 College Street LLC (the "Landlord"). Under the terms of the Lease Termination Agreement, the lease, by and between the Company and the Landlord, dated May 4, 2021 (as amended, the "Terminated Lease"), was terminated in full, effective August 15, 2024. In connection with the Lease Termination Agreement and as consideration for the Landlord’s agreement to terminate the lease for its laboratory and office space at 101 College Street in full, the Company agreed to pay to the Landlord a one-time cash termination fee in the amount of $41.5 million and wrote-off $1.9 million of prepaid rent, both of which were recognized in general and administrative expenses on the condensed consolidated statement of operations.The Company has operating leases for its corporate office, laboratories and certain equipment, which expire no later than December 2029. The leases have a weighted average remaining term of approximately 4.2 years.The components of lease expense were as follows: Three Months EndedSeptember 30,Nine Months EndedSeptember 30,(dollars in millions)2025202420252024Operating lease cost$0.7 $0.5 $2.2 $1.5 Supplemental cash flow information related to leases was as follows:Nine Months EndedSeptember 30,(dollars in millions)20252024Cash paid for amounts included in the measurement of lease liabilities:  Operating cash flows from operating leases$1.6 $1.6 Supplemental non-cash information:Right-of-use assets obtained in exchange for new lease obligations$1.5 $— In December 2024, the Company, entered