Quarterly Report for Quarter Ending October 31, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Special Note Regarding Forward-Looking Statements

We have made statements in this Quarterly Report on Form 10-Q that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements convey our current expectations or forecasts of future events. Forward-looking statements include statements regarding our future financial position, business strategy, pending, threatened, and current litigation, liquidity, budgets, projected revenue and costs, plans and objectives of management for future operations. The words "may," "continue," "estimate," "intend," "plan," "will," "believe," "project," "expect," "anticipate", and similar expressions may identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking.

The forward-looking statements contained in or incorporated by reference are largely based on our expectations, which reflect estimates and assumptions made by management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve several risks and uncertainties that are beyond our control, including:

	●	our ability to improve, market and commercialize our products, and achieve and sustain profitability;
	●	our continued improvement of our proprietary technologies, and expected continued use of cash from operating activities unless or until we achieve positive cash flow from the commercialization of our products and services;
	●	changes in current legislation, regulations and economic conditions regarding Federal governmental tariffs;
	●	our ability to obtain additional funding, as and if needed, which will be subject to several factors, including market conditions, our financial condition and our operating performance;
	●	our ability to comply with the covenants and other obligations under our convertible notes;
	●	our ability to do business with properly qualified customers that have good credit ratings and pay their obligation on a timely basis;
	●	the ability to continue as a going concern;
	●	our history of operating losses, which we expect to continue for at least the short-term and possibly longer;
	●	our ability to manage challenges and expenses associated with communications and disputes with activist shareholders, including litigation;
	●	our ability to manage and mitigate risks associated with our internal cyber security protocols and protection of the data we collect and distribute;
	●	our ability to protect our intellectual property portfolio;
	●	the impact of potential inflation related to the U.S. dollar on our business, operations, customers, suppliers, manufacturers, and personnel;
	●	our ability to meet product enhancement, manufacturing and customer delivery deadlines and the potential impact due to disruptions to our supply chain or our ability to identify vendors that can assist with the prefabrication elements of our products, as a result of, among other things, staff shortages, order delays, and increased pricing from vendors and manufacturers;
	●	our forecasts and estimates regarding future expenses, revenue, gross margin, cash flow and capital requirements;
	●	our ability to identify and penetrate markets for our products, services, and solutions;
	●	our ability to effectively respond to competition in our targeted markets;
	●	our ability to establish relationships with our existing and future strategic partners which may not be successful;
	●	our ability to maintain the listing of our common stock on the NYSE American;
	●	the reliability and continuous improvement of our technology, products and solutions;
	●	our ability to increase or more efficiently utilize the synergies available from our product lines:
	●	our ability to expand markets across geographic boundaries;
	●	our ability to be successful with Federal government work which is complex due to various statutes and regulations applicable to doing business with the Federal government;
	●	our ability to be successful doing business internationally which requires strict compliance with applicable statutes and regulations;
	●	the current geopolitical world uncertainty, including tariffs, Russia's invasion of Ukraine, the Israel/Palestine conflict and previous attacks on merchant ships in the Red Sea;
	●	the potential impact that new foreign country tariffs may have on our ability (i) to source and procure necessary raw materials for the manufacture and provision of our products and services; and (ii) to deliver our products to such foreign countries;
	●	our ability to hire and retain key personnel, including senior management, to achieve our business objectives; and
	●	our ability to establish and maintain consistent commercial profit margins.

Any or all of our forward-looking statements in this report may turn out to be inaccurate. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. They may be affected by inaccurate assumptions we might make or unknown risks and uncertainties, including the risks, uncertainties and assumptions described in Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended April 30, 2025, and in our subsequent reports under the Exchange Act. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this report may not occur as contemplated and actual results could differ materially from those anticipated or implied by the forward-looking statements.

Many of these factors are beyond our ability to control or predict. These factors are not intended to represent a complete list of the general or specific factors that may affect us. You should not unduly rely on these forward-looking statements, which speak only as of the date of this filing. Unless required by law, we undertake no obligation to publicly update or revise any forward-looking statements to reflect new information or future events or otherwise.

The following discussion and analysis should be read in conjunction with the accompanying unaudited consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q. Some of the information contained in this management's discussion and analysis is set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business, pending and threatened litigation and our liquidity, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section of our Annual Report on Form 10-K for the year ended April 30, 2025 for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. References to a fiscal year in this Form 10-Q refer to the year ended April 30 of that year (e.g., fiscal 2025 refers to the year ended April 30, 2025). References to "we," "us," "our", and "OPT" refer to Ocean Power Technologies, Inc. and its subsidiaries, as applicable.

Overview

Ocean Power Technologies, Inc. ("OPT," "we," "our," or "the Company") is a Maritime Domain Awareness (MDA) company specializing in innovative intelligent maritime solutions. These solutions include a variety of "as a service" systems, including Data as a Service (DaaS), Robotics as a Service (RaaS), and Power as a Service (PaaS). These systems consist of a variety of platforms including the PowerBuoy®, our persistent sensor and power solution, the WAM-V® (Wave Adaptive Modular Vessel), our autonomous unmanned surface vehicle, and Merrows™, our user interface and command and control (C2) system that integrates multiple sensor feeds using software and hardware and enables artificial intelligence and machine learning (AI/ML) integration. We design, manufacture, deploy, and operate these systems for defense, security, subsea infrastructure, offshore oil and gas, offshore energy, marine research, and communication markets. We operate primarily through a combination of direct sales and leases, strategic partnerships, and long-term service agreements. Our business model emphasizes capital-light deployments, recurring revenue from service and maintenance contracts, and high-margin technology sales and leases.

There have been no material changes to the Company's business description from that disclosed in our Annual Report on Form 10-K for the year ended April 30, 2025, filed with the SEC on July 24, 2025, and our Quarterly Report on Form 10-Q for the quarter ended July 31, 2025, filed with the SEC on September 15, 2025, except as noted below.

During the quarter and as described in more detail below, we issued an additional $6.5 million of convertible notes to institutional investors, and increased our backlog from comparable prior year period.

Liquidity

During the six months ended October 31, 2025, the Company incurred a net loss of approximately $18.2 million and used cash in operations of approximately $13.1 million. The Company's future results of operations involve significant risks and uncertainties. Factors that could affect the Company's future operating results and could cause actual results to vary materially from expectations include, but are not limited to, performance of its products, its ability to market and commercialize its products and new products that it may develop, access to capital, technology development, scalability of technology and production, ability to attract and retain key personnel, concentration of customers and suppliers, pending or threatened litigation and deployment risks and integration of acquisitions.

The Company believes cash on hand and forecasted operating results will provide sufficient liquidity to meet its obligation for at least the next 12 months. Convertible debt is expected to be repaid through the issuance of common stock. Subsequent to quarter end and through the date of this filing approximately $0.5 million of the convertible debt has been repaid, entirely through the issuance of common shares. In the event operating results are not sufficient the Company will need to seek additional financing. There can be no assurance that the Company will be able to raise additional capital on favorable terms, or at all, if needed.

At-the-Market Offering Program

On August 8, 2025, we entered into an At Market Issuance Sales Agreement (the "Sales Agreement") with Ladenburg Thalmann & Co. Inc. under which we may offer and sell, from time to time, shares of our common stock having an aggregate gross sales price of up to $40.0 million. We intend to use any net proceeds for general corporate purposes, including sales and marketing, product development, working capital, capital expenditures, repayment or refinancing of indebtedness, repurchases or redemptions of securities, and potential acquisitions.

This facility replaced our prior ATM program, which was terminated effective August 8, 2025.

Convertible Notes

In May 2025, we issued $10.0 million aggregate principal amount of convertible notes with a 24-month maturity, receiving net proceeds of $9.7 million. The notes are convertible into shares of our common stock under specified terms, and conversion could result in dilution to existing shareholders. On October 7, 2025, the Company issued and sold to the investors $6.5 million of additional notes. There are $8.5 million of additional notes available under the purchase agreement with the investors.

Backlog

As of October 31, 2025, backlog was $15.0 million, compared to $3.8 million at October 31, 2024. Backlog represents unfulfilled purchase orders and agreements with commercial and governmental customers. The Company expects to convert all current backlog within the next 12 to 36 months. The amount and timing of backlog conversion to revenue is subject to change.

Critical Accounting Policies and Estimates

There have been no material changes to our critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K for the year ended April 30, 2025.

Recently Issued Accounting Standards

In recent periods, the FASB issued certain Accounting Standards Updates (ASUs) that may be relevant to the Company's operations and financial reporting. We are currently evaluating the potential impact of these ASUs and adopting them when applicable based on their effective dates.

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), which improves the transparency of income tax disclosures by requiring companies to (1) disclose consistent categories and greater disaggregation of information in the effective rate reconciliation and (2) provide information on income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, although early adoption is permitted. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively. We are currently evaluating the impact of adopting this ASU 2023-09 on our consolidated financial statements and disclosures for the annual period ending April 30, 2026.

In November 2024, the FASB issued ASU No. 2024-3, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses." This ASU improves the disclosures about a public business entity's expenses and addresses requests from investors for more detailed information about the types of expenses in commonly presented expense captions. The new guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating what the potential impact of adopting this ASU 2024-03 could have on our consolidated financial statements and disclosures

In July 2025, the FASB issued Accounting Standards Update 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"). ASU 2025-05 provides a practical expedient that all entities can use when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers. Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods in those years. Entities that elect the practical expedient and, if applicable, make the accounting policy election are required to apply the amendments prospectively. We are currently evaluating the potential impact of adopting ASU 2025-05 on our consolidated financial statements and disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which clarifies and modernizes certain aspects of the accounting for, and disclosure of, internal-use software costs. The ASU removes all references to software development project stages so that the guidance is neutral to different software development methods and clarifies the threshold entities apply to begin capitalizing costs. The ASU is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods. Early adoption is permitted. The Company is currently evaluating the impact that the adoption of this standard will have on the Company's consolidated financial statements.

Financial Operations Overview

The following describes certain line items in our Statements of Operations and some of the factors that affect our operating results.

We currently focus our sales efforts in key global markets in North America, South America, Europe and Asia. The following table shows the percentage of our revenues by geographical location of our customers for the three and three months ended October 31, 2025 and 2024.

		Three months ended October 31,								Six months ended October 31,
Customer Location*		2025				2024				2025				2024
North America & South America			32	%			73	%			17	%			61	%
EMEA			26	%			26	%			72	%			38	%
Asia & Australia			42	%			1	%			11	%			1	%
			100	%			100	%			100	%			100	%

* For U.S. Government contracts, the revenue is classified as North American however, location of operations may differ.

Cost of revenue

Our cost of revenue consists primarily of subcontracts, incurred materials, labor and manufacturing overhead expenses, such as engineering expenses, equipment depreciation, maintenance, and facility related expenses, and includes the cost of equipment to customize the PowerBuoy®, WAM-V® and our other products supplied by third-party suppliers. Cost of revenue also includes PowerBuoy® and other product system delivery and deployment expenses and may include losses recorded at the time a loss is forecasted to be incurred on a contract.

Operating Expenses

Engineering and product development costs

Our engineering and product enhancement costs consist of salaries and other personnel-related costs and the costs of products, materials and outside services used in our product enhancement and unfunded research activities. Our product enhancement costs relate primarily to our efforts to increase the power output and reliability of our PowerBuoy® system and other products, to enhance and optimize data monitoring and controls systems, and the development of new products, product applications and complementary technologies. We expense all of these costs as incurred.

Selling, general and administrative costs

Our selling, general and administrative costs consist primarily of professional fees, salaries, share-based compensation and other personnel-related costs for employees and consultants engaged in sales and marketing of our products, and costs for executive, accounting and administrative personnel, professional fees and other general corporate expenses.

Interest income, net

Interest income, net consists of interest received on cash, cash equivalents, and short-term investments and interest paid on certain obligations to third parties as well as amortization expense related to the premiums on the purchase of short-term investments.

Foreign exchange gain (loss)

We transact business in various countries and have exposure to fluctuations in foreign currency exchange rates. Since we conduct our business in U.S. dollars and our functional currency is the U.S. dollar, our main foreign exchange exposure, if any, results from changes in the exchange rate between the U.S. dollar and transactions settled in foreign currencies.

The Company completed the process of winding down its Australian subsidiary during fiscal 2024 and its UK subsidiary during fiscal 2025. The unrealized gains or losses resulting from foreign currency balances translation are included in Accumulated Other Comprehensive Loss within Shareholders' Equity. Foreign currency transaction gains and losses are recognized within our Consolidated Statements of Operations.

We currently do not hedge our exchange rate exposure. However, we assess the anticipated foreign currency working capital requirements and capital asset acquisitions of our foreign operations and assess the need and cost to utilize financial instruments to hedge currency exposures on an ongoing basis and may hedge against exchange rate exposure in the future.

Results of Operations

This section should be read in conjunction with the discussion below under "Liquidity and Capital Resources."

Three months ended October 31, 2025 compared to the three months ended October 31, 2024

The following table contains selected statement of operations information, which serves as the basis of the discussion of our results of operations for the three months ended October 31, 2025 and 2024.

		Three months ended October 31,
		2025				2024
Revenues		$	424			$	2,418
Cost of revenues			1,804				1,623
Gross margin			(1,380	)			795
Operating expenses			8,743				4,710
Operating loss			(10,123	)			(3,915	)
Interest (expense) income, net			(564	)			3
Other income (expense), net			(128	)			-
Foreign exchange gain			(10	)			(1	)
Loss before income taxes			(10,825	)			(3,913	)
Income tax benefit			-				-
Net loss		$	(10,825	)			(3,913	)

Revenues

Revenues for the three months ended October 31, 2025 and 2024 were approximately $0.4 million and $2.4 million, respectively. The year-over-year decline in revenue was largely driven by timing impacts associated with the U.S. federal government shutdown. These disruptions shifted a number of OPT deliverables and development activities into subsequent quarters, which reduced our revenue.

Cost of revenues

Cost of revenues for the three months ended October 31, 2025 and 2024 increased to $1.8 million from $1.6 million, respectively. The year-over-year increase is related primarily to full recognition of losses associated with contracts in strategically important markets. The expenses associated with these projects are now substantially complete, although they will continue to generate revenue over the next several months. Importantly, our core programs and commercial pipeline continue to demonstrate improving margin quality and operating leverage.

Operating expenses

Operating expenses for the three months ended October 31, 2025 and 2024 were $8.7 million and $4.7 million, respectively. The increase of approximately $4.0 million was primarily the result of the significant increases in share-based compensation of $2.5 million, increases in professional fees of $0.8 million and increases in employee related expenses of $0.4 million compared to prior year.

Interest (expense)/income

Interest (expense)/income for the three months ended October 31, 2025 and 2024 was $(564,000) and $3,000, respectively, with the decrease primarily related to interest expenses associated with the May and October 2025 convertible notes.

Other (expenses) income, net

Other (expense) income, net for the three months ended October 31, 2025 and 2024 was $(128,000) and zero, respectively, with the decrease primarily related to a litigation settlement of $195,000, offset by insurance proceeds of $67,000 in the current year

Six months ended October 31, 2025 compared to the six months ended October 31, 2024

The following table contains selected statement of operations information, which serves as the basis of the discussion of our results of operations for the six months ended October 31, 2025 and 2024.

		Six months ended October 31,
		2025				2024
Revenues		$	1,606			$	3,719
Cost of revenues			3,009				2,477
Gross margin			(1,403	)			1,242
Operating expenses			15,798				9,630
Operating loss			(17,201	)			(8,388	)
Interest (expense) income, net			(873	)			7
Other (expense) Income, net			(128	)			17
Foreign exchange gain			(10	)			(1	)
Loss before income taxes			(18,212	)			(8,365	)
Income tax benefit			-				-
Net loss		$	(18,212	)			(8,365	)

Revenues

Revenues for the six months ended October 31, 2025 and 2024 were approximately $1.6 million and $3.7 million, respectively. The year-over-year decrease is primarily related to the timing of deliveries on current year projects versus the prior year contracts of WAM-Vs.

Cost of revenues

Cost of revenues for the six months ended October 31, 2025 and 2024 increased to $3.0 million from $2.5 million, respectively. The year-over-year increase is related primarily to full recognition of one-time losses associated with contracts in strategically important markets. The expenses associated with these projects are now substantially complete, although they will continue to generate revenue over the next several months.. Importantly, our core programs and commercial pipeline continue to demonstrate improving margin quality and operating leverage

Operating expenses

Operating expenses for the six months ended October 31, 2025 and 2024 were $15.8 million and $9.6 million, respectively. The increase of approximately $6.2 million was primarily the result of the significant increases in share-based compensation of $4.6 million and increases in employee-related expenses of $1.1 million compared to prior year.

Interest (expense)/income

Interest (expense)/income for the six months ended October 31, 2025 and 2024 was $(873,000) and $7,000, respectively, with the decrease primarily related to interest expenses associated with the May and October 2025 convertible notes.

Other (expense) income, net

Other (expense) income, net for the six months ended October 31, 2025 and 2024 was $(128,000) and $17,000, respectively, with the decrease primarily related to a legal settlement of $195,000, offset by insurance proceeds of $67,000 in the current year

Liquidity and Capital Resources

Our cash requirements relate primarily to working capital needed to operate and grow our business including funding operating expenses. We have experienced and continue to experience negative cash flows from operations and net losses. The Company incurred net losses of $18.2 million and $8.4 million for the six months ended October 31, 2025 and 2024, respectively. Refer to "Liquidity Outlook" below for additional information.

Net cash used in operating activities

During the six months ended October 31, 2025, net cash flows used in operating activities was $13.1 million, an increase of cash used in operating activities of $2.2 million compared to net cash used in operating activities during the six months ended October 31, 2024 of $10.9 million. This primarily reflects an increase in net loss, partially offset an increase in accounts payable.

Net cash used in investing activities

Net cash used in investing activities during the six months ended October 31, 2025 was $1.7 million, compared to $0.1 million during the six months ended October 31, 2024, a change of $1.6 million. The net cash used in investing activities during the six months ended October 31, 2025 was due to the purchase of property, plant and equipment.

Net cash provided by financing activities

Net cash provided by financing activities during the six months ended October 31, 2025 and October 31, 2024 was $19.8 million and $10.0 million, respectively. The current year activity was driven by the proceeds raised related to the issuance of the May and October 2025 convertible notes of $16.8 million and ATM proceeds of $3.0 million and the prior year activity was related primarily to the issuance of common stock under the Company's At the Market Offering Program of $7.5 million and proceeds from other capital rases of $2.5 million discussed above under "Liquidity".

Effect of exchange rates on cash and cash equivalents

There was no material effect of exchange rates on cash and cash equivalents during either the three or six months ended October 31, 2025 and October 31, 2024.

Liquidity Outlook

Since our inception, the cash flows from customer revenues have not been sufficient to fund our operations and provide the capital resources for our business. As of October 31, 2025, our year-to-date revenues were $1.6 million, our year-to-date net losses were $18.2 million, and our year-to-date net cash used in operating activities was $13.1 million.

We expect to continue to devote substantial resources to expand our sales, marketing and manufacturing programs associated with the continued commercialization of our products. Our future capital requirements will depend on several factors, including but not limited to:

	●	our ability to improve, market and commercialize our products, and achieve and sustain profitability;
	●	our continued improvement of our proprietary technologies, and expected continued use of cash from operating activities unless or until we achieve positive cash flow from the commercialization of our products and services;
	●	changes in current legislation, regulations and economic conditions regarding Federal governmental tariffs, tand the potential that this affects the demand for, or restrict the use of, our products and services;
	●	our ability to obtain additional funding, as and if needed, which will be subject to several factors, including market conditions, our financial condition and our operating performance;
	●	our ability to comply with the covenants and other obligations under our convertible notes;
	●	our ability to do business with properly qualified customers that have good credit ratings and pay their obligation on a timely basis;
	●	the ability to continue as a going concern;
	●	our history of operating losses, which we expect to continue for at least the short-term and possibly longer;
	●	our ability to manage challenges and expenses associated with communications and disputes with activist shareholders, including litigation;
	●	our ability to manage and mitigate risks associated with our internal cyber security protocols and protection of the data we collect and distribute;
	●	our ability to protect our intellectual property portfolio;
	●	the impact of potential inflation related to the U.S. dollar on our business, operations, customers, suppliers, manufacturers, and personnel;
	●	our ability to meet product enhancement, manufacturing and customer delivery deadlines and the potential impact due to disruptions to our supply chain or our ability to identify vendors that can assist with the prefabrication elements of our products, as a result of, among other things, staff shortages, order delays, and increased pricing from vendors and manufacturers;
	●	our forecasts and estimates regarding future expenses, revenue, gross margin, cash flow and capital requirements;
	●	our ability to identify and penetrate markets for our products, services, and solutions;
	●	our ability to effectively respond to competition in our targeted markets;
	●	our ability to establish relationships with our existing and future strategic partners which may not be successful;
	●	our ability to maintain the listing of our common stock on the NYSE American;
	●	the reliability and continuous improvement of our technology, products and solutions;
	●	our ability to increase or more efficiently utilize the synergies available from our product lines:
	●	our ability to expand markets across geographic boundaries;
	●	our ability to be successful with Federal government work which is complex due to various statutes and regulations applicable to doing business with the Federal government;
	●	our ability to be successful doing business internationally which requires strict compliance with applicable statutes and regulations;
	●	the current geopolitical world uncertainty, including tariffs, Russia's invasion of Ukraine, the Israel/Palestine conflict and previous attacks on merchant ships in the Red Sea;
	●	the potential impact that new foreign country tariffs may have on our ability (i) to source and procure necessary raw materials for the manufacture and provision of our products and services; and (ii) to deliver our products to such foreign countries;
	●	our ability to hire and retain key personnel, including senior management, to achieve our business objectives; and
	●	our ability to establish and maintain consistent commercial profit margins.

Our business is capital intensive, and through October 31, 2025, we have been funding our business principally through sales of our securities. As of October 31, 2025, our cash and cash equivalents and long-term restricted cash balance was $11.8 million and we expect to fund our business with this amount and, to a lesser extent, with our cash flow generated from operations. Management believes the Company's current cash and cash equivalents, and long-term restricted cash, and future financing through facilities such as the August 2025 ATM and convertible note facility will be sufficient to fund its planned expenditures through December 2026.

Off-Balance Sheet Arrangements

Since inception, we have not engaged in any off-balance sheet financing activities.