{"url_path":"/sec/slbt/10-k/2026/item-5","section_key":"item-5","section_title":"Item 5 OPERATING AND FINANCIAL REVIEW AND PROSPECTS**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-18","source_url":"https://www.sec.gov/Archives/edgar/data/2070534/0001213900-26-070158-index.html","accession_number":"0001213900-26-070158","cik":"0002070534","ticker":"SLBT","issuer_name":"SL Science Holding Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/2070534/0001213900-26-070158-index.html","primary_entity_key":"0002070534","primary_entity_name":"SL Science Holding Ltd"},"word_count":4017,"has_tables":true,"body_markdown":"** **\n\n**ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS**\n\n** **\n\nThe following discussion and\nanalysis provide information that SL Bio’s management believes is relevant to an assessment and understanding of SL Bio’s\nconsolidated results of operations and financial condition. The discussion should be read together with the historical consolidated financial\nstatements and related notes that are included elsewhere in this Report. Unless the context otherwise requires, references\nin the discussion in this section to “SL Bio”, “we”, “us” and “our” refer to the business\nand operations of SL Bio and its predecessors and consolidated subsidiaries.\n\nThe discussion may contain\ncertain “forward-looking statements” based upon the current expectations of SL Bio’s management, which expectations\ninvolve risks and uncertainties. We do not undertake to update any forward-looking statements to reflect the impact of circumstances or\nevents that arise after the dates they are made. See the section entitled “*Cautionary Note Regarding Forward-Looking Statements.*”\nYou should, however, consult further disclosures and risk factors included elsewhere this Report. See the section\nentitled “*Risk Factors.*”\n\n** **\n\n**Overview**\n\nSL Bio specializes in developing\ninnovative cellular and gene therapies. It began its business in 2023, and serves as a supplier of animal products to customers in Taiwan.\nSince June 2024, SL Bio has engaged in research and development in the biomedical industry, including with CD-19 Armed-T products\nand further extended this research and development to GDT cell therapy products for brain and pancreatic cancers in December 2024.\n\nSL Bio was established\nas the holding company with the intention to perform reorganization of X-Source Future Technology Co., Ltd., a company\nincorporated in Taiwan in July 2022 (the “Reorganization”). On November 4, 2024, X-Source Future\nTechnology Co., Ltd. changed its name to SL Bio Co., Ltd. (“SL Bio Taiwan”). On May 6, 2022, SL Link Co., Ltd.\n(“SL Link”), a company incorporated in Taiwan, commenced the research and development of the Exosome business and then\ndecided to exercise the business reorganization and spin-off such business into a separate legal entity, SL Bio Taiwan. SL Link has\ncontinued its operation in semiconductor equipment design and service; and research and development of biomedical products business\nand referred to as the “OldCo”. SL Bio, through SL Bio Taiwan, manages the research, development and sales of Exosome\nproducts (Exosome Business), which was historically operated by the OldCo and, not as a standalone entity prior to the completion of\nthe Reorganization transactions completed on June 14, 2024.\n\nSL Bio is primarily engaged\nin sales of plant extract products and milk-derived exosome products to the customers in Taiwan. Early in June 2024, SL Bio obtained patents,\ntechnology and global market authorization from CytoArm the research and development of Bi-Specific antibodies for use in producing armed\nimmune cells technology for application in blood cancer therapy. This cooperation leads SL Bio to commence the cancer therapeutics technology\nthat marks a significant expansion of SL Bio’s research and development capabilities. On March 9, 2023, SL Link entered into a global\nexclusive license agreement with CytoArm (the “CytoArm License Agreement”) to license the patent and know-how of CD-19 Armed-T\nproducts (the “CD-19 Armed-T Licensed Patent”). On June 20, 2024, the license was transferred to us from SL Link in accordance\nwith the patent transfer agreement (the “Patent Transfer Agreement”). Upon entering into the Patent Transfer Agreement, SL\nLink transferred the CD-19 Armed-T Licensed Patent, including the cooperation rights with CytoArm and the results generated from the CD-19\nArmed-T products, to SL Bio, for $949,771, which is equivalent to the cost that SL Link incurred for research and development prior to\nthe transfer. SL Bio bears the research and development costs of the CD-19 Armed-T products thereafter. CytoArm consented to the transfer\nof the CD-19 Licensed Patent to SL Bio and agreed to continue cooperating with SL Bio for the research and development of the CD-19 Armed-T\nproducts. On November 20, 2024, CytoArm, SL Bio, and SL Link entered into a supplementary agreement to confirm the transfer of the CD-19\nArmed-T Licensed Patent from SL Link to the Group and clarified the transfer of the rights, obligations, and financial arrangements between\nthe parties. Under the CytoArm License Agreement and the supplementary agreement, SL Bio continues to hold a perpetual, irrevocable, royalty-bearing,\nexclusive license to manufacture, use, import, offer to sell, and sell the CD-19 Armed-T products.\n\nOn December 27, 2024,\nSL Bio entered into two license agreements with JY BioMed for proprietary technology and technical data relating to GDT cells technology\nfor pancreatic and brain cancer treatment in the global market. On April 28, 2025, SL Bio amended and restated its agreement with\nJY BioMed to, among other things, combine the two prior agreements into a single agreement, grant SL Bio exclusive licenses for pancreatic\nand brain cancer treatment, and adjust the total consideration.\n\n19\n\nThe total consideration to JY BioMed under the amended and restated\nGDT Cells Licenses Agreement is $38 million and SL Bio is obligated to pay a royalty of 7% and 10% of the sales of the GDT cell therapy\nproducts for pancreatic and brain cancer treatment generated from JY BioMed Licenses, respectively. As of the date of this Report, $1 million of the total consideration was paid to JY BioMed for the initial research and development costs and material costs\nof the GDT cell therapy products for pancreatic and brain cancer treatment with $37 million remaining subject to the satisfaction\nof certain specified conditions and milestones. SL Bio will bear the future research and development costs of GDT cell therapy products\nthereafter. The term of licensed period of the GDT Cells Licenses is 20 years after the GDT cell therapy products are launched, unless\nterminated if there is a mutual recognition of significant delays or impossibility of completion, a material breach not corrected within\nthirty days, certain financial or organizational changes causing damage, delayed payments constituting a material breach, false reporting\nby SL Bio, or an incurable material breach.\n\n** **\n\n**Outlook**\n\nSL Bio’s vision is to\nbe a leading provider of innovative and effective cellular therapies globally, transforming cancer treatment and regenerative medicine.\nThe success of SL Bio will be dependent on an employee base that includes specialists with extensive medical and biological training.\nSL Bio will focus on product development, continuous improvement of its research and development capabilities with the partners, CytoArm\nand JY BioMed. We intend to accomplish this through new product development, acquisitions, licensing, the application of intellectual\nproperty unique to the medical industry, and through investing in research and development capabilities that enable us to compete globally.\nFurther, SL Bio intends to continue increasing the market value of its intellectual property portfolio to support licensure of all its\nproducts globally.\n\n**Key Factors Affecting Our Performance**\n\nSL Bio believes that future\nsuccess will be dependent on several key factors, including those discussed below. While these areas represent opportunities for us, they\nalso represent challenges and risks that we must successfully address in order to continue the growth of our business and improve our\nresults of operations.\n\n** **\n\n**Proven Capabilities Across a Broad Spectrum\nof Solutions**\n\nSL Bio has an extensive suite\nof solutions ranging from human-derived immune cells products for brain and pancreatic cancers treatments to milk-derived exosome skin\ncare and plant extract haircare product sales. SL Bio faces competition from well financed biopharma companies and is working to distinguish\nitself through advancements which distinguish its solutions from the competition.\n\n** **\n\n**Notable Strategic Partnerships, Offering\nValidation and Growth Potential**\n\nSL Bio is an exosome products\nsupplier, as well as having licensing partnerships with CytoArm for CD-19 Armed-T products and JY BioMed to develop GDT cell therapy products\nfor brain and pancreatic cancer treatments. The length of the existing licensing partnerships and the establishment of new licensing partnerships\nwill have a direct impact on SL Bio’s future revenues.\n\n** **\n\n**Proprietary Technology Supported by Licensing\nAgreements and IP Portfolio**\n\nMulti-decade, exclusive licensing\nagreements and owned, patented technology provides SL Bio with significant competitive first-mover advantage in each of its clinical markets.\n\n** **\n\n**Large and Underserved Markets for Each Solution\nShowcase Untapped Growth Potential**\n\nMulti-billion-dollar global\nmarket sizes over the next decade provide significant growth potential for SL Bio’s solutions. Entering large and underserved markets\nrequires significant increases in production capacity, business development expenses, IT expenses, marketing expenses, labor costs related\nto employee headcount, and back-office support.\n\n** **\n\n****\n\n20\n\n** **\n\n**Strong Leadership Team with Deep Expertise\nin Biotech and Finance**\n\nSL Bio has a founder-led management\nteam with experience in new drug development, medical-grade health product development, and financial management and accounting. Expansion\nof SL Bio will lead to increased costs to hire skilled labor with the level of expertise required to execute SL Bio’s expansion\nplans. The labor pool for expertise of the caliber required to execute SL Bio’s business plan is limited and will likely require\nsignificant expenditures related to salary and wages to attract qualified talent to the business.\n\n** **\n\n**Production Capacity**\n\nSL Bio may be required to make\nsignificant capital expenditures to execute its business plan. These capital expenditures would be invested in further research and development,\nfacilities, production equipment and other expenses to support increases in production. To the extent SL Bio outsources production, its\ncost of revenue may be higher versus in-house production but may be offset in whole or in part because capital expenditures will be reduced.\n\n** **\n\n**Customer Demand**\n\nFavorable industry\ndynamics for blood, pancreatic and brain cancer therapeutics market present SL Bio with numerous growth opportunities. According to\na report published by Market Research Future in April 2025, the global blood cancer therapeutics market size in 2025 was\nestimated to $42.32 billion and is estimated to grow to $73.66 billion in 2034 with a CAGR of 6.35%. According to Fortune\nBusiness Insights, the global pancreatic cancer treatment market is currently valued at approximately $3.30 billion and is\nprojected to reach $10.69 billion by 2032, reflecting a strong compound annual growth rate. In the U.S., the market alone is\nexpected to grow to about $5.25 billion by 2032, highlighting the country’s significant role in driving demand and\ninnovation in cancer care. Similarly, the global brain tumor treatment market, valued at around $2.07 billion in 2024, is\nanticipated to rise to $4.42 billion by 2032. The U.S. market for brain tumor therapies is projected to reach\n$1.47 billion by 2030, demonstrating parallel momentum and growing commercial potential.\n\nSL Bio’s licensors are\nuniquely positioned to address this growing demand given their modular and portable production design and anticipated high return on invested\ncapital.\n\n** **\n\n**Commitment to Research and Expenses**\n\nAs at December 31, 2025, SL\nBio had following commitment to research and expenses:\n\nAccording to the supplementary\nagreement entered into with CytoArm on November 20, 2024, in respect of the CD-19 Armed-T Licensed Patent, SL Bio is obligated to pay\nup to $4.1 million when certain conditions and milestones are satisfied and completed by CytoArm.\n\nAccording to the amended and\nrestated agreement entered into with JY BioMed on April 28, 2025, in respect of the JY BioMed GDT Cells Licenses, SL Bio is obligated\nto pay up to $37 million when certain conditions and milestones are satisfied and completed by JY BioMed.\n\n** **\n\n****\n\nAccording to the service agreement\nentered into with HeXun Bio-Science Co., Ltd. (\"HeXun \") on December 11, 2025 for the preparation of IRB specimens and the drafting\nof quality documentation relating to GDT cell therapy products, SL Bio is obligated to pay up to NTD25,000,000 equivalents to $825,000\nwhen certain conditions and milestones are satisfied and completed by HeXun.\n\n****\n\n**Costs of Revenue**\n\nOur profitability may be affected\nby our ability to effectively manage our purchase costs of the exosome products from the single supplier in Taiwan. If purchase prices\nincrease, we will have to offset these higher costs either through price increases to our customers. Our ability to control our costs\nis also dependent on our ability to negotiate with our supplier for a better price and our ability to source the products from other reliable\nsuppliers in a cost-efficient manner. In addition, we expect that an increase in our sales volume will enable us to lower our purchase\ncosts through economies of scale. Our royalty costs will also increase the costs of revenue in accordance with the increased revenue generated\nfrom the sales of licensed products and rendering of licensed services in future.\n\n** **\n\n**Regulatory Landscape**\n\nThe sale and purchase of SL\nBio’s products are subject to extensive federal, state, local, and foreign government laws. SL Bio is also subject to the rules\nand regulations of the U.S. Federal Drug Administration and various state and international agencies that control the export, import,\ndistribution, and sale of medical products which will be developed from the CD-19 and GDT technologies in future. Such regulations may\nadversely affect demand for our products by imposing limitations that increase the costs or limit the availability of our products.\n\n** **\n\n****\n\n21\n\n** **\n\n**Results of Operations**\n\n** **\n\n**Year Ended December 31, 2025 Compared\nto the Year Ended December 31, 2024**\n\nThe following table presents\nsummarized financial information taken from our consolidated statements of operations for the year ended December 31, 2025 compared\nwith the year ended December 31, 2024 (amounts in thousands):\n\nFor the Year Ended\n\nDecember 31,\n2025\nDecember 31,\n2024\n\nNet revenue\n$2,197\n$3,364\n\nCost of revenue\n(1,422)\n(1,431)\n\nGross profit\n775\n1,933\n\nGeneral and administrative expenses\n2,544\n1,107\n\nResearch and development expenses\n2,069\n2,021\n\nSelling and marketing expenses\n—\n1\n\nTotal operating expenses\n4,613\n3,129\n\nLoss from operations\n(3,838)\n(1,196)\n\nOther income (expenses)\n\nOther income (expenses), net\n(23)\n17\n\nInterest expenses\n40\n45\n\nTotal other income, net\n17\n62\n\nLoss income before income tax\n(3,821)\n(1,134)\n\nIncome taxes\n*—\n(57)\n\nNet loss\n$(3,821)\n$(1,191)\n\n*For the year ended December 31, 2025, the income tax expense\nis less than $1,000.\n\n** **\n\n**Net Revenue**\n\nRevenue for the year ended\nDecember 31, 2025 consists of the following:\n\nCorporate\nCustomers\nRetail\nCustomers\nTotal\n\nExosome concentrate\n$2,086,707\n$70,890\n$2,157,597\n\nSkin care products\n4,091\n9,190\n13,281\n\nHair care products\n3,403\n22,968\n26,371\n\nTotal\n$2,094,201\n$103,048\n$2,197,249\n\nRevenue for the year ended\nDecember 31, 2024 consists of the following:\n\nCorporate\nCustomers\nRetail\nCustomers\nTotal\n\nExosome concentrate\n$1,665,645\n$1,631,121\n$3,296,766\n\nSkin care products\n—\n20,917\n20,917\n\nHair care products\n—\n45,920\n45,920\n\nTotal\n$1,665,645\n$1,697,958\n$3,363,603\n\n22\n\nNet revenue decreased by $1,166,354\nor 35% from $3,363,603 for the year ended December 31, 2024 to $2,197,249 for the year ended December 31, 2025. This\ndecrease was primarily due to SL Bio Taiwan’s ongoing business transformation, under which, starting in the third quarter of 2024,\nthe Company shifted from direct sales of exosome concentrate products to individual end-users and corporate customers to wholesale sales\nto corporate distributors in Taiwan. Under this new model, although the gross margin from wholesale sales is relatively lower, this shift\nallows the Company to focus more resources on research and development projects. In addition, while distributors place larger-volume orders,\nthe frequency of orders is lower, and the elimination of direct sales to individual and corporate customers resulted in lower overall\nrevenue for 2025.\n\n**Cost of Revenue**\n\nCost of revenue decreased by\n$8,655 or 1% from $1,430,842 for the year ended December 31, 2024 to $1,422,187 for the year ended December 31, 2025. Our cost\nof revenue consists primarily of purchase costs on products for resales. The decrease in cost of revenue was higher than the decrease\nof net revenue, which was primarily due to the increase of corporate sales with a lower margin during the year ended December 31,\n2025.\n\n** **\n\n**Gross Profit**\n\nIn accordance with U.S. GAAP,\nSL Bio utilizes the lower of cost or net realizable value for determining its inventory value.\n\nWe believe that, as we continue\nto grow net revenue through new markets and expanded distribution, our gross profit will also increase. We plan to accomplish this through\nthe following:\n\n●improving the product sources;\n\n●increasing and diversifying our customer base and exploring\nnew distribution channels;\n\n●introducing new product lines that carry higher margins;\n\n●establishing additional licensing agreements;\n\n●reducing purchase costs through greater purchasing power and\nscalability;\n\n●expanding strategic relationships with component providers;\n\n** **\n\n**Operating Expenses**\n\nTotal operating expenses\nincreased by $1,483,678 or 47%, from $3,128,872 for the year ended December 31, 2024 compared to $4,612,550 for the year ended\nDecember 31, 2025. The increase was mainly caused by $1,359,197 or\n123% increase in general and administrative expenses, primarily due to the increase in office salaries by $1,162,394 or,\n529.3%, as SL Bio expanded the senior management team in early 2025. On the other hand, SL Bio incurred $2,069,022 of\nresearch and development expenses of CD-19 Armed-T products and GDT cell therapy products during the year ended December\n31, 2025, which was increased by $48,676 or, 2%, from $2,020,346 for the year ended December 31, 2024.\n\n** **\n\n**Interest and Other Income (Expenses), Net**\n\nFor the year ended December 31,\n2025, interest and other income, net decreased by $44,747 or 72% to $17,666 compared to the year ended December 31, 2024 due\nprimarily to the decrease in operating lease income generated from the lease of system and software owned by SL Bio to a clinic in Taiwan.\nSL Bio generated totaling $42,251 from the operating lease arrangements and early termination of lease arrangement for the year ended\nDecember 31, 2024 and such operating lease arrangements were ceased effective in January 2025 and became nil for the year ended December\n31, 2025.\n\n** **\n\n23\n\n**Net Loss**\n\nFor the year ended December 31,\n2025, SL Bio had net loss of $3,819,818 compared to a net loss of $1,191,333 for the year ended December 31, 2024.\n\n** **\n\n**Liquidity and Capital Resources**\n\nSL Bio has operated primarily\nas a development stage company since its formation. SL Bio recognized a net loss of $3,819,818 for the year ended December 31, 2025,\nnet loss of $1,191,333 for the year ended December 31, 2024 and an accumulated deficit of $5,484,378 as of December 31, 2025.\n\nSL Bio has historically funded\noperations through private equity offerings and related party debt.\n\nPursuant to the Merger Agreement,\nSL Bio is required to use its reasonable best efforts to raise not less than $5.0 million of additional capital in one or more financings.\n\nWe believe that these financing\nactivities will allow SL Bio to meet both its operating and debt obligations over the next year. However, our liquidity assumptions may\nprove to be incorrect, and we could utilize our available financial resources sooner than we currently expect. We also recognize that\nthere can be no assurance that our forecast plan will be met. Our future capital requirements and the adequacy of available funds will\ndepend on many factors, including those set forth in the Form F-4, in the sections titled “Risk Factors ”, which is\nincorporated herein by reference.\n\nWe may need to raise additional funds to finance our operations through\nfurther equity or equity-linked offerings or debt financing arrangements. If we raise additional funds by issuing equity or equity-linked\nsecurities, the ownership of our existing shareholders will be diluted. If we raise additional financing by the incurrence of indebtedness,\nwe will be subject to increased fixed payment obligations and could also be subject to restrictive covenants, such as limitations on our\nability to incur additional debt, and other operating restrictions that could adversely impact our ability to conduct our business. See\nthe section entitled “*Risk Factors — Risks Related to SL Bio — SL Bio will need additional funding\nin order to implement its business plan.*” as set forth in the Form F-4, which is incorporated herein\nby reference, SL Bio recognizes that there is no assurance that any such additional financing will be obtained or that the terms of such\narrangements will be reasonable. If we are unable to obtain additional funds, we would also take other measures to reduce expenses to\noffset any shortfall.\n\n** **\n\n**Cash and Cash Equivalents and restricted\ncash**\n\nCash and cash equivalents\nincluded cash on hand placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original\nmaturity of three months or less. Cash balances that have restrictions as to withdrawal or usage as collateral for credit card service\nprovided by a financial institution are considered restricted cash. As of December 31, 2025, SL Bio’s restricted and unrestricted\ncash was approximately $1.3 million compared to $4.2 million at December 31, 2024. This decrease was primarily due to the net cash used\nin operating activities of approximately $1.9 million, acquisition of property, plant and equipment of approximately $0.3 million, increase\nof deferred offering costs of approximately $0.9 million and the net effect of the exchange difference of approximately $0.2 million for\nthe year ended December 31, 2025.\n\n** **\n\n**Cash Flows**\n\nThe following table summarizes\nSL Bio’s cash flows for the year indicated (in thousands):\n\nYear Ended\nDecember 31,\n\n2025\n2024\n\nNet cash provided by (used in) operating activities\n$(1,910)\n$280\n\nNet cash provided by (used in) investing activities\n(320)\n123\n\nNet cash provided by (used in) financing activities\n(879)\n3,066\n\n24\n\n**Cash Flows Provided by (Used in) Operating\nActivities**\n\nNet cash used in operating activities for the year ended December 31,\n2025 was $1,909,796, primarily related to the net loss for the year ended of $3,819,818, offset by a decrease in inventories\nof $1,350,946.\n\nNet cash provided by operating activities for the year ended December 31,\n2024 was $280,158, primarily related to a decrease in advance to supplier by $1,399,886, offset by the net loss for the year of $1,191,333.\n\n** **\n\n**Cash Flows Provided by (Used in) Investing\nActivities**\n\nNet cash used in investing\nactivities for the year ended December 31, 2025 was $319,685, driven by the acquisition of plant and equipment.\n\nNet cash provided by investing activities for the year ended December 31,\n2024 was $123,283, primarily driven by the proceeds on disposal of plant and equipment.\n\n** **\n\n**Cash Flows (Used in) Provided by Financing\nActivities**\n\nNet cash used in financing\nactivities for the year ended December 31, 2025 was $879,137, consisting of deferred offering costs.\n\nNet cash provided by financing\nactivities for the year ended December 31, 2024 was $3,066,076, consisting primarily of net proceeds from equity financings offset\nby the net change in the Parent’s investment prior to the completion of the Reorganization in June 2024 and deferred offering\ncosts.\n\n** **\n\n**Commitments and Contingencies**\n\nSL Bio’s commitments\ninclude our operating lease liabilities.\n\nThe following table summarize our contractual obligations and other\ncommitments for cash expenditures as of December 31, 2025 and the years in which these obligations are due as follows\n(in thousands):\n\nPayments Due In\n\nLess than\n1 year\n1 – 2\nyears\n2 – 3\nyears\n3 – 4\nyears\n4 – 5\nyears\nThereafter\nTotal\n\nOperating lease liabilities(a)\n$149\n65\n—\n—\n—\n—\n214\n\nTotal commitments\n$149\n65\n—\n—\n—\n—\n214\n\n(a)\nDuring the year ended December 31, 2025 ,\nSL Bio entered into an operating lease agreement with a third party lessor that commenced on January 1, 2025. The term of the operating\nlease agreement runs through May 2027. Under the operating lease, SL Bio pays monthly rent of NTD417,053 ($14,327) through May 2025\nand thereafter the monthly rent will increase to NTD429,145 ($14,742).\n\n25\n\nAs at December 31, 2025, SL\nBio had following commitment to research and expenses:\n\nAccording to the supplementary\nagreement entered into with CytoArm on November 20, 2024, in respect of the CD-19 Armed-T Licensed Patent, SL Bio is obligated to pay\nup to $4.1 million when certain conditions and milestones are satisfied and completed by CytoArm.\n\nAccording to the amended and\nrestated agreement entered into with JY BioMed on April 28, 2025, in respect of the GDT Cells Licenses, SL Bio is obligated to pay\nup to $37 million when certain conditions and milestones are satisfied and completed by JY BioMed.\n\n** **\n\n****\n\nAccording to the service agreement\nentered into with HeXun Bio-Science Co., Ltd. (\"HeXun \") on December 11, 2025 for the preparation of IRB specimens and the drafting\nof quality documentation relating to GDT cell therapy products, SL Bio is obligated to pay up to NTD25,000,000 equivalents to $825,000\nwhen certain conditions and milestones are satisfied and completed by HeXun.\n\n** **\n\n**Off-Balance Sheet Arrangements**\n\nAs of December 31, 2025 and\nDecember 31, 2024, we did not engage in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC."}