Company: RNAC
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001453687-25-000085
Chunk: 47

Company: Cartesian Therapeutics, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 47
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 the Company determined that the right-of-use asset related to the operating lease for approximately 7,216 square feet at 65 Grove Street was partially impaired as of November 30, 2023. As a result, the Company recognized a $0.7 million right-of-use asset impairment charge in the year ended December 31, 2023.As a result of the expiration of the sublease to Sobi in November 2024 and the Company’s decision to cease use of its office and laboratory space at 65 Grove Street, Watertown, Massachusetts, the Company assessed the right-of-use assets and related furniture and fixtures associated with the Watertown Lease Agreement and Watertown Lease Agreement Amendment for impairment. The carrying value of each asset group was compared against the future net undiscounted cash flows projected to be generate over the remaining lease terms. These projections included management’s estimates off cash inflows from potential sublease income. The carrying amount of the asset groups was found to be unrecoverable, thus the Company assessed the fair value of each asset group. The fair value was determined using the income approach, whereby the Company discounted the estimated net cash flows using a rate commensurate with the Company’s estimated incremental borrowing rate. As a result of this assessment, which included unrecoverable operating and maintenance costs, the Company determined that each asset group was fully impaired. As such, an impairment charge of $7.6 million was recognized during the year ended December 31, 2024, $7.4 million of which related to the right-of-use assets and $0.2 million related to property and equipment.704 Quince Orchard Road LeasesIn connection with the Merger, the Company acquired two operating leases for office and laboratory space in Gaithersburg, Maryland. These leases expire in January 2027 and do not contain any renewal rights. The discount rate of 11.5% was determined based on the Company’s incremental borrowing rate adjusted for the lease term.For the three months ended March 31, 2025 and 2024, the components of lease costs were as follows (in thousands):Three Months EndedMarch 31,20252024Operating lease cost$584 $775 Variable lease cost406 397 Short-term lease cost11 3 Less: Sublease income— (510)Total lease cost$1,001 $665 The maturity of the Company’s operating lease liabilities as of March 31, 2025 were as follows